LeMaitre Vascular’s shares fell 3.7% post-earnings, reflecting investor disappointment despite solid sales and EPS growth, driven primarily by cautious gross margin guidance and deceleration in unit growth within the distribution business.

• Sales grew 11% in Q1, driven by an 8% price increase and 2% unit growth, with direct organic sales growing 12.8%; however, the distribution segment saw lower-than-average unit performance, weighing on growth.
• Gross margin improved 350 basis points year-over-year to 72.7%, but Q2 guidance lowered margins to 72.1% due to new warehouse and tissue processing transfers, signaling near-term margin pressure.
• Operating expenses rose 6% to $30.6 million despite a 3% overall headcount reduction; operating income increased 41% to $17.8 million with a 27% operating margin.
• EPS grew 42% to $0.68, boosted by margin expansion and a structurally lower tax rate due to higher foreign-derived intangible income deductions.
• Full-year revenue guidance affirmed at $280 million for 12% organic growth, but margin guidance only modestly raised, underscoring cautious outlook amid ongoing operational transitions.