Establishment Labs Posts First Positive Free Cash Flow

The Tip Desk · November 1, 2026 · 3 min read

Third-quarter revenue reached $72.0 million, up 33.9%, as the company lifted full-year 2026 guidance to more than $274 million.

Establishment Labs Holdings Inc. (ESTA), a global medical technology company focused on breast aesthetics and reconstruction, reported third-quarter revenue of $72.0 million, up 33.9% from $53.8 million a year earlier. The company said the quarter marked the first period in its history with positive operating cash flow and free cash flow.

U.S. sales were the primary growth engine. U.S. revenue increased 119.0% to $26.0 million. Outside-U.S. revenue rose 9.7% to $46.0 million. Minimally invasive revenue increased 124.0% year over year to approximately $9 million. The company expanded its U.S. commercial footprint to more than 2,100 accounts, with more than 400 plastic surgeons trained on Preservé, and received FDA approval for additional smaller Motiva implant sizes. It also announced larger implant sizes for the minimally invasive platform and a new supply agreement with NuSil.

GAAP gross profit was $49.7 million, or 69.1% of revenue, compared with a GAAP gross margin of 70.1% in the prior-year period. GAAP gross profit included $1.3 million of inventory charges associated with restructuring. Excluding those charges, adjusted gross margin was 70.8%, up 70 basis points year over year. The company said the mix also reflected stronger-than-anticipated OUS distributor sales, which contributed incremental revenue and gross profit dollars at lower margins.

GAAP operating expenses were $52.3 million, compared with $41.7 million in the prior-year period. Excluding litigation-related costs and restructuring and transition charges, adjusted operating expenses were $49.6 million, or 68.8% of revenue, compared with 77.6% a year earlier. GAAP net loss was $10.7 million, or $(0.35) a share, compared with a net loss of $11.1 million, or $(0.38) a share, in the prior-year period. Adjusted EBITDA increased to $6.4 million, or 8.9% of revenue, from $1.2 million, or 2.2% of revenue, a year ago.

Net cash provided by operating activities was approximately $7.7 million for the quarter, and free cash flow was $5.1 million. Cash and cash equivalents totaled $75.8 million at September 30, 2026. Chief Executive Officer Peter Caldini said third-quarter results reflected strong global revenue growth, increasing operating leverage and an important milestone in cash generation.

Based on third-quarter performance and its current outlook, Establishment Labs raised full-year 2026 revenue guidance to more than $274 million, from the previous range of $269 million to $271 million. The company set adjusted gross margin for the full year at approximately 70.7%, reflecting a higher-than-anticipated mix of OUS distributor sales. Adjusted operating expenses remained $195 million to $200 million. The company expects positive adjusted EBITDA for the full year.

Caldini said the company expects fiscal 2027 to deliver growth of 25% and positive cash flow, with opportunities in minimally invasive and reconstruction. FDA review of Motiva for breast reconstruction was described as progressing in line with expectations.