Despite maintaining resilient gross margins near 70.8% in 2026Q1, the company struggles with operating margin compression, which has fluctuated between 9.7% and 17.9% over the last ten quarters.
| Metric | TTM | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 | Dec'18 | Dec'17 | Dec'16 | Dec'15 | Dec'14 | Dec'13 | Dec'12 | Dec'11 | Dec'10 | Dec'09 | Dec'08 | Dec'07 | Dec'06 | Dec'05 | Dec'04 | Dec'03 | Dec'02 | Dec'01 | Dec'00 | Dec'99 |
|---|
| Sales/Revenue | 4.1B | 4.03B | 4B | 3.86B | 3.73B | 3.95B | 2.47B | 2.41B | 1.97B | 1.47B | 1.08B | 845.49M | 761.65M | 660.21M | 560.04M | 479.74M | 387.13M | 312.33M | 303.98M | 284.33M | 206.35M | 207.13M | 172.83M | 122.72M | 69.7M | 44.81M | 6.74M | 411K |
| Revenue Growth % | 2.89% | 0.9% | 3.54% | 3.42% | -5.51% | 59.9% | 2.71% | 22.39% | 33.47% | 36.44% | 27.72% | 11.01% | 15.37% | 17.89% | 16.74% | 23.92% | 23.95% | 2.75% | 6.91% | 37.79% | -0.37% | 19.84% | 40.83% | 76.08% | 55.55% | 564.71% | 1540.15% | - |
| Cost of Goods Sold | 1.32B | 1.28B | 1.2B | 1.16B | 1.1B | 1.02B | 708.71M | 662.9M | 518.63M | 356.47M | 264.58M | 205.38M | 183.21M | 162.1M | 143.65M | 118.46M | 83.71M | 78.84M | 78.85M | 75.03M | 64.78M | 63.78M | 57.53M | 51.56M | 44.99M | 46.83M | 20.25M | 1.75M |
| COGS % of Revenue | - | 31.67% | 30% | 29.92% | 29.48% | 25.74% | 28.67% | 27.54% | 26.37% | 24.19% | 24.5% | 24.29% | 24.05% | 24.55% | 25.65% | 24.69% | 21.62% | 25.24% | 25.94% | 26.39% | 31.39% | 30.79% | 33.28% | 42.02% | 64.55% | 104.51% | 300.42% | 426.76% |
| Gross Profit | 2.77B | 2.76B | 2.8B | 2.71B | 2.63B | 2.94B | 1.76B | 1.74B | 1.45B | 1.12B | 815.29M | 640.11M | 578.44M | 498.11M | 416.39M | 361.28M | 303.42M | 233.49M | 225.13M | 209.3M | 141.58M | 143.34M | 115.3M | 71.16M | 24.71M | -2.02M | -13.51M | -1.34M |
| Gross Margin % | 67.68% | 68.33% | 70% | 70.08% | 70.52% | 74.26% | 71.33% | 72.46% | 73.63% | 75.81% | 75.5% | 75.71% | 75.95% | 75.45% | 74.35% | 75.31% | 78.38% | 74.76% | 74.06% | 73.61% | 68.61% | 69.21% | 66.72% | 57.98% | 35.45% | -4.51% | -200.42% | -326.76% |
| Gross Profit Growth % | - | -1.51% | 3.41% | 2.77% | -10.27% | 66.48% | 1.11% | 20.45% | 29.63% | 37% | 27.37% | 10.66% | 16.13% | 19.63% | 15.25% | 19.07% | 29.95% | 3.72% | 7.56% | 47.83% | -1.23% | 24.32% | 62.03% | 188.02% | 1321.91% | 85.03% | -905.96% | - |
| Operating Expenses | 2.18B | 2.14B | 2.19B | 2.06B | 1.99B | 1.96B | 1.38B | 1.2B | 981.3M | 763.34M | 566.37M | 451.48M | 384.87M | 403.89M | 330.8M | 270.92M | 200.68M | 267.5M | 209.61M | 175.44M | 179.12M | 140.9M | 105.54M | 91.1M | 97.53M | 98.75M | 67.61M | 13.36M |
| OpEx % of Revenue | - | 53.05% | 54.8% | 53.43% | 53.32% | 49.56% | 55.67% | 49.92% | 49.9% | 51.81% | 52.45% | 53.4% | 50.53% | 61.18% | 59.07% | 56.47% | 51.84% | 85.65% | 68.96% | 61.7% | 86.8% | 68.02% | 61.07% | 74.23% | 139.93% | 220.38% | 1002.89% | 3251.09% |
| Selling, General & Admin | 1.77B | 1.76B | 1.76B | 1.7B | 1.67B | 1.71B | 1.2B | 1.07B | 852.4M | 665.78M | 490.65M | 390.24M | 332.07M | 292.8M | 251.34M | 233.77M | 170.14M | 243.93M | 177.22M | 151.51M | 160.64M | 122.31M | 89.78M | 77.98M | 84.58M | 83.1M | 58.44M | 9.16M |
| SG&A % of Revenue | - | 43.51% | 44.09% | 44.1% | 44.84% | 43.23% | 48.58% | 44.54% | 43.35% | 45.19% | 45.44% | 46.16% | 43.6% | 44.35% | 44.88% | 48.73% | 43.95% | 78.1% | 58.3% | 53.29% | 77.85% | 59.05% | 51.95% | 63.54% | 121.35% | 185.46% | 866.87% | 2229.2% |
| Research & Development | 371.37M | 369.91M | 364.2M | 346.83M | 305.26M | 250.31M | 175.31M | 157.36M | 128.9M | 97.56M | 75.72M | 61.24M | 52.8M | 44.08M | 42.87M | 37.15M | 26M | 22.25M | 26.16M | 25.73M | 18.47M | 18.59M | 15.76M | 13.11M | 13.06M | 15.64M | 9.17M | 4.2M |
| R&D % of Revenue | - | 9.17% | 9.11% | 8.98% | 8.17% | 6.33% | 7.09% | 6.54% | 6.55% | 6.62% | 7.01% | 7.24% | 6.93% | 6.68% | 7.65% | 7.74% | 6.72% | 7.12% | 8.61% | 9.05% | 8.95% | 8.97% | 9.12% | 10.68% | 18.74% | 34.91% | 136.02% | 1021.9% |
| Other Operating Expenses | 2M | 14.98M | 64.14M | 13.32M | 11.45M | 0 | 0 | -28.01M | 0 | 0 | 0 | 0 | 0 | 67.01M | 36.59M | 0 | 4.55M | 1.32M | 6.23M | -1.8M | 0 | 0 | 0 | 0 | -116K | 0 | 0 | 0 |
| Operating Income | 591.59M | 616.22M | 607.63M | 643.34M | 642.6M | 976.4M | 387.17M | 542.49M | 466.56M | 353.61M | 248.92M | 188.63M | 193.58M | 94.21M | 85.59M | 90.36M | 102.73M | -34.01M | 15.51M | 33.85M | -37.54M | 2.45M | 9.77M | -19.94M | -72.82M | -100.77M | -81.11M | -14.71M |
| Operating Margin % | 14.44% | 15.27% | 15.19% | 16.66% | 17.21% | 24.7% | 15.66% | 22.54% | 23.73% | 24% | 23.05% | 22.31% | 25.42% | 14.27% | 15.28% | 18.84% | 26.54% | -10.89% | 5.1% | 11.91% | -18.19% | 1.18% | 5.65% | -16.25% | -104.48% | -224.89% | -1203.31% | -3577.86% |
| Operating Income Growth % | - | 1.41% | -5.55% | 0.12% | -34.19% | 152.19% | -28.63% | 16.27% | 31.94% | 42.06% | 31.96% | -2.55% | 105.47% | 10.07% | -5.28% | -12.04% | 402.05% | -319.23% | -54.18% | 190.19% | -1634.59% | -74.95% | 148.98% | 72.62% | 27.74% | -24.23% | -451.62% | - |
| EBITDA | 789.86M | 796.8M | 752.66M | 785.74M | 768.39M | 1.09B | 480.71M | 621.48M | 521.29M | 391.35M | 272.92M | 206.64M | 211.43M | 111.04M | 103.4M | 107.84M | 116.92M | -21.01M | 28.3M | 47.24M | -27.27M | 12.9M | 24.49M | 1.99M | -43.74M | -70.97M | -78.6M | -14.15M |
| EBITDA Margin % | 19.28% | 19.75% | 18.82% | 20.34% | 20.57% | 27.45% | 19.45% | 25.82% | 26.51% | 26.56% | 25.27% | 24.44% | 27.76% | 16.82% | 18.46% | 22.48% | 30.2% | -6.73% | 9.31% | 16.61% | -13.21% | 6.23% | 14.17% | 1.62% | -62.75% | -158.38% | -1166.03% | -3441.85% |
| EBITDA Growth % | 7.34% | 5.86% | -4.21% | 2.26% | -29.19% | 125.74% | -22.65% | 19.22% | 33.2% | 43.39% | 32.08% | -2.27% | 90.42% | 7.38% | -4.11% | -7.77% | 656.55% | -174.22% | -40.08% | 273.26% | -311.41% | -47.33% | 1132.36% | 104.54% | 38.37% | 9.71% | -455.65% | - |
| D&A (Non-Cash Add-back) | 198.27M | 180.59M | 145.03M | 142.4M | 125.79M | 108.73M | 93.54M | 78.99M | 54.73M | 37.74M | 24M | 18M | 17.86M | 16.82M | 17.81M | 17.48M | 14.19M | 13M | 12.79M | 13.38M | 10.27M | 10.45M | 14.72M | 21.92M | 29.08M | 29.8M | 2.51M | 559K |
| EBIT | 608.59M | 585.29M | 671.76M | 656.65M | 654.05M | 976.4M | 387.17M | 514.48M | 466.56M | 353.61M | 248.92M | 188.63M | 193.58M | 161.22M | 122.18M | 90.36M | 107.28M | -33.81M | 17.1M | 33.85M | -37.54M | 2.45M | 9.77M | -19.94M | -72.82M | -100.77M | -81.11M | -14.71M |
| Net Interest Income | 13.08M | 16.05M | 20.22M | 17.26M | 5.37M | 3.1M | 3.13M | 12.48M | 8.58M | 6.95M | 4.21M | -2.53M | -3.21M | -1.07M | -1.3M | 501K | 555K | 494K | 3.03M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Interest Income | 14.64M | 16.05M | 20.22M | 17.26M | 5.37M | 3.1M | 3.13M | 12.48M | 8.58M | 6.95M | 4.21M | 0 | 0 | 0 | 757K | 552K | 555K | 579K | 3.05M | 4.2M | 3.18M | 1.92M | 713K | 531K | 979K | 0 | 0 | 0 |
| Interest Expense | 1.56M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 2.53M | 3.21M | 1.07M | 2.05M | 51K | 0 | 85K | 24K | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Other Income/Expense | 2.14M | -30.93M | 1.33M | -2.13M | -43.54M | 36.02M | -8.22M | 12.63M | -8.61M | 11.19M | -6.36M | -2.53M | -3.21M | -1.07M | -1.3M | -419K | -731K | 119K | 1.56M | 3.1M | 3.4M | 283K | -3K | -101K | 0 | 1.73M | -7.63M | 14.71M |
| Pretax Income | 593.73M | 585.29M | 608.96M | 641.2M | 599.06M | 1.01B | 378.95M | 555.12M | 457.96M | 364.8M | 242.57M | 186.1M | 190.37M | 93.14M | 84.3M | 89.94M | 102M | -33.89M | 17.08M | 36.95M | -34.13M | 2.73M | 9.76M | -20.04M | -72.82M | -99.04M | -88.75M | 0 |
| Pretax Margin % | 14.5% | 14.51% | 15.23% | 16.6% | 16.04% | 25.61% | 15.33% | 23.06% | 23.29% | 24.76% | 22.46% | 22.01% | 24.99% | 14.11% | 15.05% | 18.75% | 26.35% | -10.85% | 5.62% | 13% | -16.54% | 1.32% | 5.65% | -16.33% | -104.48% | -221.03% | -1316.54% | - |
| Income Tax | 163.84M | 174.94M | 187.6M | 196.15M | 237.48M | 240.4M | -1.4B | 112.35M | 57.72M | 130.16M | 51.2M | 42.08M | 44.54M | 28.84M | 25.61M | 23.23M | 27.75M | -2.62M | -62.91M | 1.23M | 828K | 1.32M | 994K | 84K | 0 | 10K | 0 | 0 |
| Effective Tax Rate % | 27.59% | 29.89% | 30.81% | 30.59% | 39.64% | 23.75% | -368.64% | 20.24% | 12.6% | 35.68% | 21.11% | 22.61% | 23.4% | 30.97% | 30.38% | 25.82% | 27.21% | 7.74% | -368.42% | 3.32% | -2.43% | 48.22% | 10.18% | -0.42% | 0% | -0.01% | 0% | - |
| Net Income | 429.89M | 410.35M | 421.36M | 445.05M | 361.57M | 772.02M | 1.78B | 442.78M | 400.24M | 231.42M | 189.68M | 144.02M | 145.83M | 64.3M | 58.69M | 66.72M | 74.25M | -31.27M | 79.99M | 35.72M | -34.96M | 1.41M | 8.77M | -20.12M | -72.82M | -99.05M | -88.75M | -15.41M |
| Net Margin % | 10.5% | 10.17% | 10.54% | 11.52% | 9.68% | 19.53% | 71.84% | 18.4% | 20.35% | 15.71% | 17.57% | 17.03% | 19.15% | 9.74% | 10.48% | 13.91% | 19.18% | -10.01% | 26.31% | 12.56% | -16.94% | 0.68% | 5.07% | -16.4% | -104.48% | -221.05% | -1316.54% | -3750.61% |
| Net Income Growth % | 4.96% | -2.61% | -5.32% | 23.09% | -53.17% | -56.53% | 301.08% | 10.63% | 72.95% | 22% | 31.71% | -1.24% | 126.82% | 9.55% | -12.03% | -10.15% | 337.47% | -139.09% | 123.9% | 202.18% | -2574.38% | -83.88% | 143.57% | 72.37% | 26.48% | -11.61% | -475.72% | - |
| Net Income (Continuing) | 429.89M | 410.35M | 421.36M | 445.05M | 361.57M | 772.02M | 1.78B | 442.78M | 400.24M | 231.42M | 189.68M | 144.02M | 145.83M | 64.3M | 58.69M | 66.72M | 74.25M | -31.27M | 79.99M | 35.72M | -34.96M | 1.41M | 8.77M | -20.12M | -72.82M | -99.05M | -88.75M | -15.41M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| EPS (Diluted) | 6.00 | 5.65 | 5.62 | 5.81 | 4.61 | 9.69 | 22.41 | 5.53 | 4.92 | 2.83 | 2.33 | 1.77 | 1.77 | 0.78 | 0.71 | 0.83 | 0.95 | -0.45 | 1.18 | 0.50 | -0.55 | 0.02 | 0.14 | -0.35 | -1.42 | -2.31 | -16.00 | -3.65 |
| EPS Growth % | 8.56% | 0.53% | -3.27% | 26.03% | -52.43% | -56.76% | 305.24% | 12.4% | 73.85% | 21.46% | 31.64% | 0% | 126.92% | 9.86% | -14.46% | -12.63% | 311.11% | -138.14% | 136% | 190.91% | -2850% | -85.71% | 140% | 75.35% | 38.53% | 85.56% | -338.36% | - |
| EPS (Basic) | - | 5.66 | 5.63 | 5.82 | 4.62 | 9.78 | 22.55 | 5.57 | 5.00 | 2.89 | 2.38 | 1.80 | 1.81 | 0.80 | 0.73 | 0.86 | 0.98 | -0.45 | 1.20 | 0.53 | -0.55 | 0.02 | 0.15 | -0.35 | -1.42 | -2.31 | -16.00 | -3.65 |
| Diluted Shares Outstanding | 71.61M | 72.59M | 74.99M | 76.57M | 78.42M | 79.67M | 79.23M | 80.1M | 81.36M | 81.83M | 81.48M | 81.52M | 82.28M | 82.59M | 83.04M | 80.29M | 78.08M | 69.09M | 68.06M | 71.44M | 63.25M | 63.15M | 64.09M | 57.76M | 47.88M | 42.25M | 5.55M | 4.22M |
| Basic Shares Outstanding | 71.42M | 72.54M | 74.88M | 76.43M | 78.19M | 78.92M | 78.76M | 79.42M | 80.06M | 80.08M | 79.86M | 80M | 80.75M | 80.55M | 80.53M | 77.99M | 75.83M | 69.09M | 66.81M | 67.18M | 63.25M | 61.64M | 59.96M | 57.76M | 47.88M | 42.25M | 5.55M | 4.22M |
| Dividend Payout Ratio | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
Macro-driven elective demand volatility
According to the provided quarterly income statements, Align Technology's revenue growth has fluctuated significantly, oscillating between a 6.2% peak in 2026Q1 and a 1.8% contraction in 2025Q2, suggesting that the company is struggling to maintain consistent top-line momentum in its core orthodontic markets.
The inconsistent revenue trajectory indicates that the company may be facing a maturation phase where volume growth is increasingly difficult to capture. Investors should monitor whether this volatility reflects a genuine plateau in doctor utilization or if it is merely a temporary byproduct of macroeconomic headwinds affecting elective dental procedures.
As reported in the financial data, Align Technology has maintained a robust gross margin profile, consistently hovering near 70% throughout the last ten quarters, which underscores the company's significant pricing power and the premium value proposition of its proprietary digital treatment planning ecosystem.
The stability of these margins suggests that the company has successfully avoided aggressive price-cutting strategies despite the presence of lower-cost competitors. However, the slight compression observed in 2025Q3 to 64.2% warrants further investigation into whether shifts in product mix or increased manufacturing costs are beginning to erode this structural advantage.
Based on the income statement figures, operating margins have remained relatively compressed, fluctuating between 9.7% and 17.9%, which indicates that the company's high fixed costs in SG&A and R&D are not scaling efficiently with the current, largely stagnant revenue base.
The inability to consistently expand operating margins during periods of revenue growth suggests that the company is heavily reinvesting in professional education and marketing to defend its market share. This high-cost structure may limit bottom-line flexibility if revenue growth fails to accelerate in the coming quarters.
Analysis of the reported net income reveals significant quarterly variance, with EPS swinging from a low of $0.78 in 2025Q3 to $1.89 in 2025Q4, largely influenced by the irregular impact of stock-based compensation and other non-operating items disclosed in the company's recent filings.
The substantial fluctuations in net income suggest that investors should focus on normalized earnings metrics to gauge true operational performance. The significant $141.6 million stock-based compensation charge in 2025Q3 highlights how non-cash expenses can distort the perceived profitability of the firm in any given quarter.
While Align Technology maintains a dominant market position, the recent deceleration in revenue growth, as evidenced by the 0.90% YoY trend, suggests that the company's proprietary iTero-to-Invisalign ecosystem may be facing increased pressure from open-architecture scanning alternatives and general practitioner adoption challenges.
Short-term observers might argue that the company's reliance on high-touch professional education is becoming a liability in a cost-conscious environment. If the 'GP Gap' proves insurmountable, the company may find it difficult to sustain its premium valuation without a fundamental shift in its go-to-market strategy.
Quick answers to the most common questions about buying ALGN stock.
For fiscal year 2025, Align Technology, Inc. (ALGN) reported total revenue of $4.03B. This represents a 981643.1% increase compared to $0.4M in 1999.
Align Technology, Inc. (ALGN) is profitable, generating $410.4M in net income for the fiscal year ending 2025 with a net profit margin of 10.2%.
Align Technology, Inc. (ALGN) reported an operating income of $616.2M, resulting in an operating profit margin of 15.3%. This margin reflects the operational efficiency of the business before interest and taxes.
Align Technology, Inc. (ALGN) generated $2.76B in gross profit for the year, representing a gross profit margin of 68.3%. This demonstrates the company's core pricing power and production efficiency.