Align expects 2026 revenue of $4.110 billion to $4.130 billion despite slower growth
Key Facts
Align Technology forecast global revenue of $4.110 billion to $4.130 billion in fiscal 2026, after posting $1.0148 billion in the third quarter, up 1.9% year over year. The earnings statement showed revenue fell 3.9% from the second quarter, when it was $1,056.2 million, to $1,014.8 million in the third quarter. Chief Financial Officer John Morici said demand in the dental and orthodontics sectors remained affected by weakness in discretionary health care spending and capital equipment investment. He added that these conditions continued through the third quarter and that the fourth-quarter outlook "reflects what we are seeing in the broader market." The annual guidance sets the company’s performance against a mix of limited year-over-year revenue growth and continued demand pressures.
Revenue from clear aligners grew faster than total revenue, but remained below the pace of growth in case shipments. The business generated $839.3 million in third-quarter revenue, up 4.2% from the same period a year earlier. The company shipped 690,635 cases, up 6.6% year over year, compared with 647,750 cases in the year-earlier period. The comparison means shipment volume grew faster than revenue, a divergence consistent with the company’s expectation that average selling price will fall by about 1% in the fourth quarter. Align expects low-single-digit growth in clear aligner volume next quarter, alongside global revenue of $1,000 million to $1,020 million.
Meanwhile, revenue from imaging systems and computer-aided design and manufacturing services fell to $175.5 million in the third quarter, down 7.6% year over year. This highlights weakness in systems and services activity alongside growth in clear aligner revenue, as management said capital equipment investment continues to face a weaker environment. The company expects 2026 systems and services revenue of $715 million to $725 million. By contrast, it is targeting year-over-year growth of about 5% to 6% in clear aligner volume and revenue during the year. The differing outlooks for the two businesses make revenue mix a key factor in assessing the annual guidance.
The company’s profitability rose in the third quarter alongside year-over-year revenue growth. Net income was $135.0 million, up 138.0% from $56.8 million a year earlier. Diluted earnings per share rose to $1.90 from $0.78 in the third quarter of 2025. Operating margin was 16.7%, compared with 9.7% in the year-earlier period. Adjusted operating margin was 24.4%, up 0.5 percentage points year over year.
On expansion, Align announced the launch of a U.S. pilot for a new category of custom sports mouthguards. The guard is printed directly using 3D printing technology, made from a digital scan captured by an iTero scanner, and available through participating orthodontic service providers. The announcement included no revenue estimate for the product, as the current step is limited to a U.S. market pilot. In its scanner business, the number of iTero systems placed globally rose by more than double digits year over year, exceeding 157,000 systems. That figure includes leased, rented and certified refurbished units.
The leadership transition is taking place in two stages: Jennifer Davis will join the company on November 2, 2026, as CEO-elect and a member of the board. Davis will become president and CEO on December 31, 2026, succeeding Joseph Hogan, who has held the role since 2015. Hogan will remain CEO through the end of December, then serve as a strategic adviser to the company. He will also remain on the board until the strategy meeting scheduled to conclude on June 16, 2027, when he will retire from the board. Management said it expects another year of revenue growth and margin expansion in 2027, based on a planning assumption that current operating conditions remain broadly unchanged and without requiring a recovery in consumer spending.
Closing data show Align shares ended the October 27 session at $151.95, then closed at $153.62 on October 28. According to a Reuters report published via Investing.com, the stock rose 1.1% during regular trading on October 28 to $153.62, before falling 0.4% after the close to $153. The report said adjusted earnings were $2.80 per share, above analysts’ expectations of $2.78. Revenue, at about $1.02 billion, also exceeded forecasts of $1.01 billion by about $10 million. Management is scheduled to provide its full 2027 outlook when it reports fourth-quarter results, after completing the strategy and operating model review led by Davis.