Align Technology (ALGN) Q2 2026 earnings summary

Executive summary

• Q2 2026 delivered record revenues of $1.06 billion, up 4.3% year-over-year, driven by 8.2% Clear Aligner revenue growth and 7.4% increase in case volume, with double-digit international expansion and stable North America performance.

• Systems and Services revenues declined 10.8% year-over-year, reflecting softness in the capital equipment market and a shift to lower-priced scanners and flexible acquisition models.

• Non-GAAP operating margin was 22.9%, up 1.6 points year-over-year; GAAP operating margin was 14.6%, impacted by a $37.5 million UK VAT liability.

• Net income was $108.3 million (GAAP), with diluted EPS of $1.51; non-GAAP net income was $189.1 million, with EPS of $2.64.

• Strategic initiatives included board refreshment, a comprehensive operating model review, and increased share repurchase commitment following discussions with Elliott Management.

Financial highlights

• Q2 2026 total revenues: $1,056.2 million (+4.3% Y/Y); Clear Aligner revenues: $870.9 million (+8.2% Y/Y); Systems & Services revenues: $185.3 million (-10.8% Y/Y).

• Q2 2026 gross margin: 71.7% GAAP (72.3% non-GAAP), up 1.8 points year-over-year.

• Q2 2026 GAAP operating margin: 14.6% (-1.5 pts Y/Y); non-GAAP operating margin: 22.9% (+1.6 pts Y/Y).

• Q2 2026 GAAP EPS: $1.51 (down $0.20 Y/Y); non-GAAP EPS: $2.64 (+6% Y/Y).

• Cash and cash equivalents totaled $1.1 billion as of June 30, 2026; free cash flow was $157.1 million.

Outlook and guidance

• Q3 2026 revenues expected between $1.0–$1.02 billion, down sequentially; Clear Aligner volume up mid-single digits year-over-year, ASPs down sequentially.

• Q3 2026 GAAP gross margin expected at 67.5%-68.5% due to one-time charges; non-GAAP gross margin at ~71%.

• Full-year 2026 revenue growth expected at 3%-4% year-over-year; Clear Aligner volume growth at ~6%, ASP flat to slightly down; Systems & Services revenue down 6%-8%.

• 2026 GAAP operating margin expected at 15.1%-15.6%; non-GAAP operating margin at ~23%, up 100 bps year-over-year.

• $400–$500 million in share repurchases planned for 2026; capital expenditures expected at $125–$150 million.