HAE Q3 Deep Dive: Margin Expansion and Portfolio Rationalization Drive Outperformance

Blood products company Haemonetics (NYSE:HAE). announced better-than-expected revenue in Q3 CY2025, but sales fell by 5.3% year on year to $327.3 million. Its non-GAAP profit of $1.27 per share was 14.3% above analysts’ consensus estimates.

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StockStory’s Take

Haemonetics’ third quarter results were met with a significant positive market reaction, reflecting both a beat on Wall Street’s revenue and profit expectations and effective execution across its core businesses. Management attributed the outperformance to strong share gains in plasma collection solutions, sustained growth from Blood Management Technologies, and disciplined cost management. CEO Chris Simon emphasized that the company’s results “reflect disciplined execution, delivering strong core product growth, record margin expansion and solid earnings that convert to cash.” The hospital segment also contributed meaningfully to operating margin improvement, supported by continued demand for viscoelastic testing and targeted actions to address underperformance in interventional technologies.

Looking forward, Haemonetics’ updated guidance is anchored by a combination of plasma share gains, new product launches, and continued cost discipline. Management highlighted the ongoing rollout of its heparinase neutralization cartridge in Europe and Japan, as well as targeted commercial investments to revitalize interventional technology growth, particularly in vascular closure. CFO James D’Arecca noted that margin expansion remains a core focus, stating, “The strength of our core portfolio and our ability to drive margin expansion is evident in our results.” Management also pointed to the planned acquisition of Vivasure and further product pipeline expansion as potential drivers of growth beyond this year.

Key Insights from Management’s Remarks

Management cited share gains in plasma, continued expansion of Blood Management Technologies, and cost controls as primary drivers of third quarter margin and earnings growth.

• Plasma share gains: The plasma business saw robust organic growth driven by increased device placements and premium pricing for advanced collection solutions. CEO Chris Simon noted strong U.S. and European collection volumes, supported by technology innovation and rising demand for immunoglobulin therapies.
• Blood Management Technologies momentum: Blood Management Technologies delivered double-digit growth, powered by higher TEG disposable utilization and the successful launch of the heparinase neutralization cartridge in new geographies. Management believes this franchise’s growth is sustainable due to its leading market position and ongoing innovation.
• Hospital segment margin expansion: The hospital business was the largest contributor to overall margin growth, benefiting from improved sales mix, higher volumes, and greater operating leverage. The company’s focus on Blood Management Technologies allowed for targeted investments in turning around underperforming interventional products.
• Interventional Technologies turnaround efforts: Interventional Technologies remained soft, mainly due to esophageal cooling, but management implemented new sales force strategies, upgraded training, and strengthened corporate accounts to reinvigorate growth, particularly for vascular closure devices.
• Portfolio rationalization impact: Divesting non-core whole blood products enabled a sharper focus on high-margin plasma and apheresis businesses, which resulted in better operating margins and improved free cash flow conversion. Management indicated that these changes position the company for more predictable earnings and cash generation.

Drivers of Future Performance

Haemonetics expects future performance to be shaped by plasma market expansion, new product rollouts, and the stabilization of interventional technologies, with ongoing margin focus.

• Plasma market tailwinds: Management anticipates continued growth in plasma, citing strong end-market demand for immunoglobulin therapies and further share gains from expanded device adoption. However, guidance remains prudent, factoring in the cyclical nature of collections and what the company can control, such as technology-driven share gains and pricing.
• Product innovation pipeline: The recent launch of the heparinase neutralization cartridge in Europe and Japan, along with ongoing investment in viscoelastic testing and vascular closure technologies, is expected to sustain double-digit growth in Blood Management Technologies. Management also pointed to upcoming product extensions and new clinical indications as future growth levers.
• Interventional Technologies stabilization: The turnaround in interventional technologies hinges on new commercial leadership, expanded field resources, and targeted competitive responses in the vascular closure market. Management believes that these changes, along with potential regulatory approvals in Japan and the planned Vivasure acquisition, will enable a return to growth and margin expansion in this segment.

Catalysts in Upcoming Quarters

In the quarters ahead, the StockStory team will be monitoring (1) the pace of plasma share gains and collection volume trends, (2) the adoption trajectory of the heparinase neutralization cartridge in new international markets, and (3) early signs of recovery in interventional technologies, particularly vascular closure. Progress on the Vivasure acquisition and updates on product pipeline expansion will also be important indicators of Haemonetics’ ability to achieve its long-term growth objectives.

Haemonetics currently trades at $71.19, up from $50.72 just before the earnings. Is the company at an inflection point that warrants a buy or sell? The answer lies in our full research report (it’s free for active Edge members).

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