Operator: Good day, and thank you for standing by. Welcome to the Q1 2026 DENTSPLY SIRONA Inc. Earnings Conference Call. After the speakers’ presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today’s conference is being recorded. I would now like to hand the conference over to your first speaker today, Wade Moody. Please go ahead.

Wade Moody: Thank you, operator, and good afternoon, everyone. Welcome to the DENTSPLY SIRONA Inc. First Quarter 2026 Earnings Call. Joining me for today’s call are Daniel T. Scavilla and chief executive officer and Michael Pomeroy, interim chief financial officer. I would like to remind you that an earnings press release and slide presentation related to the call are available on the Investors section of our website at www.dentsplysirona.com. Before we begin, please take a moment to read the forward-looking statements in our earnings press release. During today’s call, we may make certain forward-looking statements that reflect our current views about future performance and financial results. We base these statements on certain assumptions and expectations on future events that are subject to risks and uncertainties.

Our most recently filed Form 10-K and any updated information in subsequent Form 10-Q or other SEC filings list some of the most important risk factors that could cause actual results to differ from our predictions. On today’s call, our remarks will be based on non-GAAP financial results. We believe that non-GAAP financial measures offer investors valuable additional insights into our business’ financial performance, enable the comparison of financial results between periods where certain items may vary independently of business performance, and enhance transparency regarding key metrics utilized by management in operating our business. Please refer to our press release for the reconciliation between GAAP and non-GAAP results. Comparisons provided are to the prior year quarter unless otherwise noted.

A webcast replay of today’s call will be available on the Investors section of the company’s website following the call. And with that, I will now turn the call over to Dan.

Daniel T. Scavilla: Thanks, Wade, and good afternoon, everyone. Q1 marked the start of executing the DENTSPLY SIRONA Inc. return to growth action plan. Our results reflect a business in transition, and do not yet capture the actions underway intended to drive sustained profitable growth. We are strengthening execution, investing in key growth areas, positioning the company for improved long-term performance. From my perspective, we are where we expected to be at this early stage. We are executing the plan as intended and remain focused on improving speed and accountability. As I said last quarter, we are going deeper, moving faster, and being bolder to improve our business while placing the customer at the center of all we do.

That mindset is taking hold across the organization. Near-term performance is still being affected by external pressures and the timing of our investments, while the underlying market remains stable. We are monitoring geopolitical and macro factors closely while making strong progress on the areas within our control. Regardless of market conditions, we will remain focused on executing our plan and improving our performance over time. We are engaging with our customers more, accelerating innovation, and optimizing our cost structure. These actions are already gaining momentum and are expected to contribute more meaningfully as the year progresses. During the quarter, we advanced our commercial restructuring in the U.S., expanded clinical education and sales force training, and continued to drive innovation across the portfolio while implementing a restructuring to redirect funds to fuel commercial and innovation growth.

We are also seeing early encouraging traction with our distribution partners and I will share more detail on that shortly. We remain confident in our strategy, and are maintaining our full-year 2026 outlook. On today’s call, Michael will review our first quarter 2026 financial performance and key drivers. I will then provide an update on our strategic progress, including the actions we are taking to support the five pillars of our return to growth action plan. With that, I will turn the call over to Michael.

Michael Pomeroy: Thanks a lot, Dan, and good afternoon, and thank you all for joining us. As Dan noted, first quarter results are in line with what we anticipated at this stage as we execute on our plan to continuously lean down our OpEx structure and drive sustained profitable growth. Before we begin, we announced today a change to external reporting for our regions from U.S., Europe, and Rest of World to Americas, EMEA, and APAC. This update creates a more efficient reporting structure and better reflects how we manage and evaluate the business internally. The results being reported today reflect this change. A recast of prior comparative regional information has been provided along with today’s press release. Let’s move to Q1 results on Slide 4.

Our first quarter revenue was $880 million, representing an as-reported sales increase of 0.1% over the prior quarter. On a constant currency basis, sales declined 6.7%, based in part on the impact from Byte and a strong Q1 2025 treatment center sales comparison not repeated in 2026. Adjusting for these one-time headwinds, Q1 2026 sales on a constant currency basis were down 4.5%. On a constant currency basis, sales highlights in the quarter included double-digit growth for EDS and APAC, favorable SureSmile performance in EMEA, and growth in Wellspect Healthcare. These improvements were offset by declines in EDS outside of APAC, CTS, and OIS. Adjusted EBITDA margins declined 430 basis points, resulting from a 560 basis points decline in gross profit, driven by lower volumes, sales mix, and tariff impacts.

While OpEx experienced a headwind on an as-reported basis, from a constant currency perspective, OpEx was down $20 million, reflecting benefits from our return to growth OpEx restructuring and overall cost control management. In line with what we communicated in our last earnings call, we increased our spend in R&D year over year as we support the return to growth action plan and invest in bringing innovation to market. Adjusted EPS in the quarter was $0.27. In the first quarter, operating cash flow was $40 million compared to $7 million in the prior year quarter. The year-over-year increase is primarily attributable to improvements in working capital with lower accounts receivable. This is an early sign of progress as we focus on improving working capital over the balance of the year.

We finished the quarter with cash and cash equivalents of $190 million. Our Q1 net debt to EBITDA ratio was 3.3x. During the quarter, we retired $79 million of debt. We continue to prioritize debt reduction over time and remain committed to maintaining investment grade credit metrics. Let’s now turn to the first quarter segment performance on Slide 5. Starting with CTS, constant currency sales declined 2.9%. We saw a high single-digit decline in E&I, as declines in imaging equipment and treatment centers were driven by a tougher comparison versus the prior year quarter. When adjusting out the one-time institutional installation, CTS was flat in constant currency. Our global CAD/CAM business was flat year over year, with growth in APAC offset by a decline in EMEA, which was driven by softness in the Middle East and Central Europe, partially offset by double-digit growth in the UK, Spain, Turkey, and Denmark.

We saw increased demand for mills in the U.S., along with bright spots in APAC. Overall, U.S. distributor levels for CAD/CAM and imaging products remain below historical averages. They are a trend we expect to continue. Turning to [inaudible], sales declined 7.2%, driven by lower volumes in Americas and EMEA, partially offset by growth across all three product categories in APAC. Moving to OIS, sales in constant currency declined 13.5%. Adjusting for the year-over-year impact from Byte, OIS declined 7.6%. IPS declined high single digits in the quarter, driven by lower implant volume across all three regions. SureSmile, our clear aligner offering, declined low single digits in the quarter, with a high single-digit decline in the U.S., partially offset by 11% growth in EMEA.

Wrapping up with Wellspect Healthcare, constant currency sales increased 3.4%, led by 4% growth in EMEA and the continued strength of new product and execution of the business. Now let’s move to Slide 6 to discuss our outlook for 2026. As Dan shared earlier, we are maintaining our 2026 outlook for net sales of $3.5 billion to $3.6 billion and an adjusted EPS in the range of $1.40 to $1.50. With the uncertainty and fluidity of the current macro and geopolitical environment, we are applying a thoughtful, risk-aware approach to our guidance while remaining focused on executing initiatives to drive sustainable growth. With that, I will turn the call back to Dan.

Daniel T. Scavilla: Thanks, Michael. As I mentioned in my opening comments, our focus remains on disciplined execution, and we are making progress against our plan. The management team and board are closely aligned. Priorities are clear, and the organization is engaged and motivated. I also want to recognize the strength of our leadership team, particularly our U.S. commercial leaders. Several competitive hires joined recently who bring deep dental experience and are already making meaningful impact. While it is still early, what we are seeing gives me continued confidence that we are on the right path. My leadership team and I have been spending more time in the field and at local customer events, gaining valuable firsthand perspectives.

Customers are noticing a shift in how we show up. Most importantly, we are consistently putting the customer at the center of our decisions and actions with a clear focus on improving both the experience and outcome for the dental practitioners we serve. We are in the early stages of expanding our clinical education and sales force training programs with increasing structure and scalability. Early feedback is encouraging, and the teams are responding well to greater clarity, investments in their development, and increased accountability. This work is strengthening our foundation as we prepare for more consistent execution in the second half of the year. At the same time, we are strengthening our processes to ensure solutions are grounded in real-world customer needs.

As part of this effort, we are establishing a CEO advisory board comprised of dentists to provide direct and ongoing customer insights. Returning the U.S. to growth remains our top priority. The actions we are taking to strengthen talent, execution, expand distribution, and improve customer engagement are beginning to show early traction. At the same time, we are reinforcing the key drivers of our long-term growth. A central priority is sharpening our focus on the implant business. While recent performance in this segment has been challenging, we continue to benefit from strong underlying assets and a deep heritage in the space. To build on this foundation, we initiated a disciplined set of actions to improve performance and position the business for sustainable growth.

I will provide more detailed updates in future earnings calls. Innovation also remains central, supported by increased R&D investment with a clear focus on our highest value opportunities. Let me share a few of our recent launches as seen on Slide 7 in the earnings presentation. We just announced the launch of SmartView Detect, the first FDA-cleared and CE-marked AI-enabled diagnostic aid that automatically identifies potential inflammation at the root tip in 3D scans. Integrated into the DS Core platform, the solution works with both new and existing systems, enabling seamless adoption. In clinical evaluation, SmartView Detect increased detection sensitivity by approximately 46% relative to unaided review, helping reduce the risk of overlooked findings while improving workflow efficiency.

This innovation not only enhances diagnostic confidence, but also supports clearer patient communication, reinforcing our commitment to advancing connected, high-quality dental care. In endodontics, we introduced the Reciproc Minima File System and the X-Smart Go cordless endomotor, both designed to simplify workflows and improve efficiency. Reciproc Minima enables treatment of narrow and complex canals with a one-file approach, while X-Smart Go enhances mobility and performance through cordless operation and integrated intelligence. Together, these solutions reflect our focus on practical, evidence-based innovation. In imaging, we announced FDA clearance of our dental-dedicated MRI, representing an important step forward in expanding our capabilities in soft tissue diagnostics.

The system has been validated in clinical settings, and is expected to support broader collaboration with leading academic and research institutions, consistent with our strategy to build clinical evidence and drive adoption. It also complements our existing imaging portfolio. Beyond dental, Wellspect continues to show solid momentum. Adoption of Sureti for females is expanding, supported by ease of use, discretion, patient comfort, and encouraging feedback from both patients and clinicians. Building on this, the recent launch of the male version extends the portfolio to a broader patient population. Finally, we are making progress in expanding and strengthening our U.S. distribution network. As announced yesterday, we signed an expanded agreement with Atlanta Dental Supply, adding our connected technology solutions portfolio effective August 1.

This marks our fourth new distributor agreement this year and enhances our regional coverage, improving access and service levels in an important market. The other distribution agreements announced in the first quarter are beginning to build traction and expand our commercial reach. Early traction includes Benco installing its first CEREC system under the new agreement, an important milestone achieved ahead of schedule. To lead DENTSPLY SIRONA Inc. into its next phase, we are strengthening our foundation with better tools, more integrated systems, and increased automation. This builds on the strength of our existing teams, while enhancing capabilities in transformation, operations, and financial performance. Our transformation office continues to drive execution of the return to growth action plan, with a focus on embedding lean operating principles, simplifying processes, and improving how work gets done across the organization through the customer’s lens.

In parallel, we are advancing our enterprise AI strategy to drive efficiency and support innovation across both commercial and operational areas. In Q1, we began deploying AI-enabled tools in select workflows to improve productivity, with a broader rollout planned throughout the year. Within finance, we are strengthening capabilities while maintaining continuity as we actively progress on our search for a permanent CFO. Michael continues to be a strong partner in his interim role, ensuring stability and focus on execution. We are simplifying and optimizing the operating model to improve efficiency and scalability. The restructuring program remains on track to deliver $120 million in annual savings, with benefits building through 2026 and becoming more meaningful in the second half of the year.

Key actions include cost optimization, organizational simplification, and supply chain efficiencies, along with reducing complexity across legal entities and IT systems. Through these actions and by driving lean principles further into the organization, we will improve our speed, competitiveness, and the customer experience. Early proof points are visible, including a reduction of approximately $20 million in operating expenses during the first quarter. These savings are being reinvested into growth areas such as R&D, clinical, and commercial capabilities, while we continue to manage external headwinds. A disciplined approach to capital allocation and balance sheet management remains a priority. During the quarter, we reduced debt by approximately $80 million, reflecting our commitment to deleveraging.

Capital allocation priorities remain focused on debt reduction and share repurchases, supported by improving working capital and free cash flow. With the dividend eliminated during the first quarter, we have increased flexibility in how we deploy capital, and as performance improves, we expect to be in a position to evaluate the timing of share repurchases later this year. In closing, progress is encouraging, execution is improving, cost discipline is in place, and we are building the capabilities needed to drive sustainable growth. Early proof points are emerging across the business, and visibility should continue to improve as the year progresses, particularly in the second half. We remain confident in the strategy and focused on delivering long-term value for shareholders.

I believe the potential for DENTSPLY SIRONA Inc. has never been greater, and we have at our fingertips everything we need to achieve this. Thank you. Now let us turn to Q&A.

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Operator: Thank you. At this time, we will conduct a question and answer session. As a reminder, to ask a question, you will need to press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. We kindly ask that all attendees limit their questions to one primary question and one follow-up question. Our first question comes from the line of Allen Charles Lutz of Bank of America. Please go ahead.

Allen Charles Lutz: Thanks for all the details, Dan. On the return to growth action plan, there is a lot of good steps there. You talked about new distribution relationships and expanding ones you have already had, investing in clinical education, and then new product investments. So there is a lot of things on the plate. How do you think about the timing of these benefits? I think at the top of the call, you alluded to maybe some benefits happening toward the second half of the year. As we think about all those things that you are spending time on or that you have done so far, is this something where we should start to expect more material benefits in the back half of this year? Or is this effectively more of a two- or three-year roadmap? We would love if you could just give us a sense of how you are thinking strategically about the timing of some of these investments you are making in that return to growth plan. Thanks.

Daniel T. Scavilla: Thanks, Allen. I appreciate the question. And I think you kind of answered it, right? When we first rolled out the return to growth plan, we called it a 24-month plan, recognizing that you cannot move fast enough, but at the same time, cannot change this in the speed that all of us would wish. Q1 was the beginning where we established the plan, built the teams, and did all the reorganization. This is really us out of the gate in the first quarter. As we begin some of the restructuring that is occurring in the first and second quarter, you will see some of those cost benefits come through more in the fourth quarter than you would in the first half of the year. As you look at the commercial cadence and what we plan to drive, again, I would think we will begin to see some things in the fourth quarter, but I really do believe that more of the improvements will be seen as we get into 2027 and certainly into 2028.

Allen Charles Lutz: Appreciate all the color there. And then we would love to hear an update on some of your early conversations with DSOs. Where within your portfolio is the most interest, and how can X-ray benefit help you at those?

Daniel T. Scavilla: Thanks. Again, great question. There is a lot of great activity currently occurring with DSOs. It is something we had begun into the last quarter of last year. If you look at who we are and what we offer, you have this incredible strength of a broad portfolio. Whether you want to actually build out new dental suites—we can provide all of that—or you want to get into longer plans for consumables and pull-throughs, we can do that as well. We are really talking with several concurrently, and we are looking to have a more active plan again toward the second half of this year and into next year. I think the strength is in the broad offering we can give them as a one-stop shop, and therefore bring all of the leverage bundling together for the best impact for them and ease of doing business with us.

Operator: Our next question comes from the line of Jonathan David Block at Stifel. Please go ahead.

Jonathan David Block: Maybe just the first one. I would say the trends with the consumer are certainly a watch with the geopolitical backdrop, and you guys are so global in nature that I figured I would take the opportunity. When you look across your book of business, anything to call out between Americas and EMEA and APAC when we think about March or April trends, whether that would be weakening or maybe even something to call out in terms of more resilience than maybe you expected considering what is going on in the world?

Daniel T. Scavilla: Great question, Jonathan. There are certainly a lot of moving parts here. We did not really call out the Middle East. We will keep our eyes on that. It is a low single-digit impact for us right now. The continued struggle in Central Europe with Russia certainly has its weight, something that we have built into our forecast. As of now, we stay with what we planned in our initial business plan, and should we see some of these risks changing or shifting, we will take more action after we get through the second quarter.

Jonathan David Block: Fair enough. And maybe the second question—and maybe a half question here—can you talk to us on where you are with the drop-ship model with the distributors? You talked to more distributors coming on board, but what more needs to be done there? Maybe if you want to talk to the receptivity. I mean, I think for them, it is not tying up their cash. And if you feel like it is giving you a greater voice with the distributors. And then admittedly, a completely unrelated question would just be the cadence throughout the year—do we think about the exit EBITDA margin in 4Q, which might help us bridge from 1Q to 4Q? Thanks.

Daniel T. Scavilla: No problem. A couple of things. The transition into the new capital model really applies to some of the existing dealers, not necessarily new ones. We will provide this for everybody, but when we talk about the inventory build or the change in inventory that you were referring to, that is a little more of a Patterson and Shine dynamic than all of the new players who would start at zero anyway. The first quarter did not include any of that burn-through of the inventory. We expect to see that from Q2 through Q4. It is well received. It is built into all of our agreements. It is honestly not a negotiating point with us because the benefits are for both sides and pretty easily accepted that way. I will refrain right now from giving you what we think Q4 guidance is.

It is not something we do. We want to get a couple of quarters under our belt with all of the moving parts we have, and it will really help you determine what is the best way to set up your 2027 model.

Operator: Thank you. One moment for our next question. Our next question comes from the line of Jeffrey D. Johnson with R.W. Baird. Please go ahead.

Jeffrey D. Johnson: Yes, thank you. Good evening, guys. Dan, I wanted to start with Wellspect. That business showed through very consistently and nicely this quarter. OIS and CTS, we know there is a lot of moving parts there. On the EDS side, I think that was probably the biggest surprise to me from a segment performance, just the down 7%. The comp got a little bit tougher, but the switch from plus to minus this quarter—what was driving that shift? The markets seem like they have held in fairly consistently. What was the underlying driver of that fall off? Thanks.

Daniel T. Scavilla: I would tell you we looked at a little bit of softness in the fourth quarter, and we saw that carry into the first quarter. I trace that down to specific markets. I will not call them out right now. While we believe some of it is destocking of dealers, especially those that may have gone into a little more PE-based approaches, we are working through the program for a better understanding of where that is. Right now, it really looks like there was a bigger shift in Europe than we would have anticipated. The U.S. is kind of in line where we thought. Even within Europe, there are probably about five different markets that we are taking a look at to understand what is being driven there. Our current estimates and assumptions are there is some continued destocking that we felt in the fourth quarter and in the first quarter.

As you noticed, we have not called off of our number. We think that this is a timing issue as we stand today, but we will look to see how we can prove that true.

Jeffrey D. Johnson: Understood. And then as my follow-up question, you mentioned again tonight returning the U.S. to growth by maybe later this year. Europe is actually a bigger segment for you guys geographically. Maybe the consumables thing you were just referencing there drove that European number down to down 5.6% this quarter. But as you focus on the U.S., I would assume you also plan or hope or are working towards getting that European number more consistently to growth as well. Help me understand how you are thinking about Europe over the next few quarters and eventually getting that return to growth as well.

Daniel T. Scavilla: Of course we want Europe to get back into growth. It is foundational. The U.S. stays on track; we are happy with that. In Europe, you talked about EDS, which I would agree with. Keep in mind that treatment centers were fairly large last year as well. As Michael called out, that is an academic-type thing where they come in blips, not really something you can easily forecast and see. We want to make sure we do not overstate the change because of that one-time headwind. A strong Europe and APAC are needed as well as continued growth in the Americas, and we are focusing on it. The vast majority of what we are doing to return the U.S. to growth is applicable throughout the world.

Operator: Thank you. One moment for our next question. Our next question comes from the line of Michael Anthony Sarcone of Jefferies. Please go ahead.

Michael Anthony Sarcone: Just wanted to start on gross margin. You talked about 550 basis points of contraction. Maybe you can give us a little more color on what is driving those in 1Q and then how we should think about the cadence of gross margin through the year?

Michael Pomeroy: A big piece of the headwind in gross margin is tariffs. When you are looking year on year, tariffs did not exist to the extent they do now, so that is a pretty big piece. We talked about EDS 2025, which comes off the balance sheet. It is inventoriable, therefore capitalized, and that was a negative hit as well. As far as going forward, everybody knows what is happening with tariffs. We will start seeing the adjustments from the SCOTUS decision and then down to the Trump 10% in Q2. So that piece is going to look a lot better. Dan talked about what we are working on as far as Europe—getting the destocking behind us, which we believe it is. And the third piece is tariffs down the road. But just pure apples to apples, I would think we should be gaining 300 basis points at a minimum back in the Q2–Q3 timeframe.

Michael Anthony Sarcone: Okay. That is helpful. And on macro and geopolitics from an input cost standpoint, what are you seeing in terms of higher oil and freight prices?

Daniel T. Scavilla: You were breaking up a bit, but I think I got it. Yes, we are seeing some headwinds with freight and oil. We will continue to monitor that and understand if it is something we can offset, absorb, change, or have to adjust. I want more than one quarter under the belt before we make that decision.

Operator: Thank you. One moment for our next question. Our next question comes from the line of Analyst from Piper Sandler. Please go ahead.

Analyst: Hey, guys. This is Joe Donahue on for Jason Bednar. Thanks for taking the questions. Starting on consumables more broadly, we are seeing a continued mix shift toward private label. Strategically, how are you thinking about navigating this shift? And do you read the private label trend as still having runway, or is it starting to plateau in the current environment at all?

Daniel T. Scavilla: It is a fair question. Private label is something that has been around and will continue to be around. It is something that we will obviously look at and, where it makes sense, compete against. We have several programs in development to make this a meaningful and worthwhile approach with customers. I am not going to lay those out just yet for competitive reasons. I want to get them launched before we discuss them. But it certainly has our attention and the need for us to penetrate the market with more creative ways to get our products into the hands of dentists.

Analyst: Thanks. And then to push a little more on pricing with input costs here—do you feel you have incremental ability to pass through price to offset these pressures? What is your appetite throughout the year and what might be included in the guide for pricing versus how much more you could possibly take?

Daniel T. Scavilla: We took some minor pricing last year, more on capital than anything. Our intent is not to change that right now, and I do not see anywhere where we would benefit from price increases of any significance. Right now, it is really about us staying focused on return to growth and executing in a way that is beneficial to the customer. I do not think there is a significant price play that would get us where we need to get to.

Operator: Thank you. One moment for our next question. Our next question comes from the line of Elizabeth Hammell Anderson with Evercore ISI. Please go ahead.

Elizabeth Hammell Anderson: Hi, guys. Good afternoon. Given the R&D spending in the quarter and your focus on new products, and at some recent dental shows, can you talk about the new product contribution in the quarter and how you are seeing that progress over the course of the rest of the year and maybe 2027?

Daniel T. Scavilla: Thanks, Elizabeth. We do not disclose that level of detail. We do monitor it, and it is something that we have our eye on. I will hint that we need to see those metrics improve for our investment in R&D, and I think there is an execution plan that should allow us to do that. It is not something I would put out publicly in terms of contributions for this year or next.

Elizabeth Hammell Anderson: But would you agree that it is a ramping contribution as we go into next year, really starting to step up maybe in 2027–2028?

Daniel T. Scavilla: I would agree with that.

Operator: One moment for our next question. Our next question comes from the line of Michael Aaron Cherny with Leerink Partners. Please go ahead.

Michael Aaron Cherny: Afternoon. Thanks for taking the questions. I know we have touched on a lot of the different segments. I just want to dive in a bit on implants. As you think about the next couple of years of go-to-market, where do you think you are in your combination of product reboot, sales reboot, and how to factor that into that component contributing to the return to growth opportunity?

Daniel T. Scavilla: It is a fantastic question. While we talk about geographically focusing on the U.S. as a return to health—which it is—implants are one of the top priorities. I have commissioned a team of dental KOLs to work with us and get the voice of the customer. We are working on several approaches with the team to come back with more holistic programs. I want to get them formed and launched before I speak about them. Implants are an area of focus. We are not happy with our performance to date. We recognize we have some of the best offerings in the market, and we simply need to execute in a better way and utilize those assets more strongly.

Michael Aaron Cherny: And relative to your comments about the buyback, as you think about the evaluation to the end of the year, what are the moving pieces that are going to impact your decision on a go/no-go evaluation?

Daniel T. Scavilla: Not many, to be honest. There was an opportunity by removing the dividend and redeploying it. We had some near-term debt coming due that made sense to retire. I wanted to put the funds there first because it will help us deleverage, especially as EBITDA gets stronger. It did not make sense to carry that forward. In the second half of the year, we will look at the option to remove stock. At this price, I am anxious to do it. I think it is going to be a great one to remove. I am going to get the debt in line first. I want to preserve our credit ratings the way they are, then move into removing shares in a way that makes sense not only in the second half of the year but ongoing thereafter.

Operator: One moment for our next question. Our next question comes from the line of Lilia-Celine Lozada at JPMorgan. Please go ahead.

Lilia-Celine Lozada: Maybe I will start with guidance. You beat by quite a bit on the top line on a reported basis, but reiterated the guide. I appreciate it is still early, but what is the thinking behind that? Why not flow through the beat? And are there any offsetting dynamics in Q2 through Q4 that we should be keeping in mind?

Daniel T. Scavilla: It is a great question. It is my style that I am bringing into DENTSPLY SIRONA Inc. I did the same thing back at Globus. I am not going to make a call after one quarter. I like to see at least two before we do. Regardless of it, I would not have brought it up or down. It is not a concern. It is just more of a style. I would rather be appropriately conservative than anything else right now. That is all it reflects.

Lilia-Celine Lozada: Got it. Makes sense. Then I was hoping you could dig into CTS a little bit more. That came in nicely higher than what we were thinking. Can you talk a bit more about what drove that strength and what you are seeing in terms of appetite for capital in this environment?

Daniel T. Scavilla: There are a lot of moving parts. Having expanded the dealers and working on programs with them—we called out through Michael’s script—we are seeing some strength in the U.S. Again, one quarter does not make a trend. We will continue to execute and, after a couple of quarters, see how that is shaping up. I would attribute the CTS strength more to activity occurring in the U.S. through our partners.

Operator: Thank you. One moment for our next question. Next question comes from the line of Analyst at UBS. Please go ahead.

Analyst: Thanks for taking my question. Dan, I appreciate the lift that you have here operationally and all the things that you have initiated internally. When you think about the growth initiatives, which segments or geographies do you think catch up or get to growing faster than the market? What products do you think you can get to quickest? Can DENTSPLY SIRONA Inc. grow faster than the market, in line with the market, or better than market in implants or something to that effect? What are you most excited about, or where do you think you can return to market growth or better, and what segment is fastest?

Daniel T. Scavilla: I will refrain from giving segment-by-segment growth expectations. We have been working on that, and there will be an investor day probably toward the end of this year or beginning of next, and we will do that along with the strategic plan. I believe that this organization, with the right structure and focus, can grow at or above market over time. We need to work our way through that in 2026 and into 2027, but that is the target. The U.S. has to return because of its size. Within that, through the actions we have taken with dealers, it has to be about the right placement of capital. It has to be, in my mind, implant-focused, EDS-focused, and with our enhanced R&D, we need deeper penetration into the ortho market. All of those are in play. I want to get them functioning first before I commit anything in particular. Among those, we should be at or above market as we get into a healthy cadence.

Analyst: And a quick follow-up. You are talking about capital deployment and share buybacks. Presumably there is not likely a focus on M&A, but if there was, in Wellspect or in dental, is there an area where a tuck-in or something more material might enhance the product portfolio or be more synergistic or needed?

Daniel T. Scavilla: I do not think there is anything needed. I am looking at M&A because even if we decide not to do it over the next few quarters, we are going to go back to that and sustain. We have a plan in place already. We have established an independent board with Wellspect and will announce that as we finalize. It is going to focus on hypergrowth within Wellspect so that we drive way above market and penetrate deeper. Should we find adjacencies there that are bolt-on or can be fast in closing out a gap, that would be one area of interest. In the non-dental area, we have several conversations currently with longer-term potential. Within dental, I want to refrain from specifics right now. I am looking for an accelerated way to differentiate ourselves in certain areas. Some of it would be CTS to help penetration. As far as implantable products themselves, there is nothing we are chasing down at this time or have interest in.

Operator: Thank you. One moment for our next question. Our next question comes from the line of Steven James Valiquette at Mizuho Securities. Please go ahead.

Steven James Valiquette: Great. Thanks. Good afternoon. We heard one of the global dental distributors today talk about some lower industry pricing trends on scanners or other digital equipment, primarily from newer market entrants. I am curious what you are seeing on the competitive landscape front in IOS, and what this might mean for PrimeScan or your other offerings.

Daniel T. Scavilla: I think your data is correct. There are new entrants at low cost. We have to look at our current model versus what could be market appropriate in this changing dynamic, and that is where our size and breadth of portfolio come into play. We are doing a few things. One is looking to become more competitive in that area, probably through more structured programs that not only have a scanner but the pull-through effect of it—things some of the lower-cost entrants will not be able to compete with without bundling up. We are going to use our portfolio in a bundle strategy that will allow us to accelerate some of the penetration we are seeing and be more market appropriate today.

Operator: Our next question comes from the line of Erin Wilson Wright at Morgan Stanley. Please go ahead.

Erin Wilson Wright: Great, thanks. You highlighted in the deck as well as your prepared remarks a lot on innovation in terms of specific products and areas of focus. What could really move the needle? Would you call out a couple that could be significant that we should pay attention to going forward from an innovation perspective?

Daniel T. Scavilla: Only among the ones discussed on the call, I like the AI detection as a way to further enhance the DS Core offering to our current and future customers. That one excites me. I have been a fan of Wellspect, and I see the potential of this business. The Sureti launches into an entirely new area for them and into new geographic markets. Both of those are exciting. I think the MRI is a much longer, more clinical long-term play. I do not see that as a large revenue generator over time, but rather something that will lead to future products or approaches that can be very interesting. Reciproc Minima using one file is a great approach that can reduce cost and speed up time, with what appears to be great outcomes for patients. I like them all. I think they all have potential to move us forward.

Erin Wilson Wright: And on macro and input costs, you did say you are seeing an impact now. Can you quantify that? Is it material right now? And just remind us—do you have anything embedded in your guidance, or do you think you can mitigate it? Why not make any changes on that front just to be conservative?

Daniel T. Scavilla: I will make it simple. We are not going to disclose specifics. I am creating freedom to move if we see escalation or unforeseen things. If something material occurs, we would have to react and share adjustments, whether we can absorb them or not. There is nothing material today; otherwise we would have disclosed it. In a changing world, should that change, we will come back and update your assumptions.

Operator: One moment for our next question. Our next question comes from the line of Analyst at Citi. Please go ahead.

Analyst: I want to go back to implant volume. You mentioned that across all regions, implant volumes were a little bit lower than expected. Curious if you can bifurcate between premium and value demand, realizing that the significant majority of your portfolio is premium. Is there any significant differentiation by region? And you kind of alluded to this in your prepared remarks, but can you provide a little more detail on the strategy to stem some of that lower demand and the timing of those benefits?

Daniel T. Scavilla: We are down in both value and premium for the quarter. For value—MIS in particular—it is simply underutilized. To stem that, we need to position it differently as a brand that can really drive, which I feel has not been fully implemented by the company. We are working on that. Astra is still one of the best products out there. Clinical education and rep education are all parts of that to drive improvements. I feel implants are more of an execution issue than a product issue. We have the right portfolio. We have to improve education to execute better. We will have market-appropriate or competitive programs forming in the second quarter, but I will refrain from details until we get them implemented.

Analyst: As a follow-up, last quarter you guided to a $30 million headwind in the first half of this year due to the inventory sell-through underneath the new drop-ship model. Was much of that realized this quarter? And can you quantify on a basis point basis how it impacted gross margins?

Michael Pomeroy: None of it was realized this quarter. It still is in our line of sight to happen, consistent with our previous guidance, but it is going to be more of a late Q2 and then second-half impact.

Operator: Thank you. One moment for our next question. Our next question comes from the line of Brandon Vazquez at William Blair. Please go ahead.

Brandon Vazquez: Great, thanks for the question. Maybe I can ask a portfolio question from the opposite side. As you are in the seat another quarter here, as you are looking at the portfolio, is there anything you think that maybe DENTSPLY SIRONA Inc. is not the right home for? Anything on the rationalization side that might help improve the P&L?

Daniel T. Scavilla: Great question, Brandon. My answer is no, not yet. I want to see how the market responds to our return to growth plan. I want to look at these from a different light. I do not like the position we are currently in, and I want to stabilize and get them growing. Then we say what makes sense or not. We announced the creation of the Growth and Value Committee. With that, I have the board working with me to look at potential M&A and whether it makes sense for something to be set up as a divestiture. My ask of them—and right now everybody is aligned—is to get through the execution phase before we evaluate where that makes sense. I am not afraid to do it. I just do not have the right facts or positioning to do that in what I think is the best interest of all of us.

Brandon Vazquez: Makes sense. And as a follow-up, within CTS and EDS, APAC was highlighted as an area of strength while there are some other pockets of weakness. Could you spend a minute on APAC and why things are doing relatively well there for this portfolio compared to the other regions?

Daniel T. Scavilla: I would point to the leadership and structure. They are strong and well educated, and they spend well on clinical education. Everything I am saying I am bringing into the U.S. was started there, and I think that is one of the drivers. With APAC as well, we are looking at doing a similar thing. It is more of a long-term investment growth. Again, I would point out the strength really based on the execution of a team with a good plan, and one that we can learn from and spread throughout the world.

Operator: This concludes the question and answer session. Thank you for your participation in today’s conference. This does conclude the program. You may now disconnect.

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DENTSPLY SIRONA INC

Q1 2026

Earnings Transcript

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