Keith Pfeil: And Craig, I would just add that I think the market has moved through its curve, it’s adoption curve. And you’ve gone past the early adopters at this point. These technologies are proven. And so there is more willingness for surgeons to actually use this as well as hospitals to bring it in as something that they feel is a benefit to the patients. So I think that we’re moving along that maturity curve for people willing to use it.
Craig Bijou: Great. Thanks for taking the questions, guys.
Keith Pfeil: Thank you.
Operator: Thank you for your question. Please stand by for our next question. Our next question comes from the line of Caitlin Cronin of Canaccord Genuity. Your line is now open.
Caitlin Cronin: Thank you for taking the questions and congrats on a great quarter.
Daniel Scavilla: Thank you.
Caitlin Cronin: Yes, awesome. Just to set off, have you begun to think about discontinuing any redundant product lines and in that vein and kind of towards the enabling texting as well. What about PULSE [ph] any updated color and updated plans for this product as well?
Daniel Scavilla: Caitlin, thanks for the question. So we’ll take it into two pieces. No, we’ve stated openly that we are not going to proactively drive SKU or product rationalization. We’re going to offer everything out to customers. And I think over time, customers will migrate a certain direction that we will follow. I don’t feel like I’m in a position to prescribe to surgeons what products they can use. I think we have to stay focused on what they need for their own goods. So that piece we’ll continue on the path we are, which is no planned rationalizations. Enabling tech over time, always has different purposes that we can look at. So again, we don’t have anything we would state today that we feel like we’re going to obsolete or replace or pull out at this given time.
I think PULSE has a great step forward. There’s a lot of applications globally that we’re looking for it now. We’re fine-tuning some plans. We’ve made it clear that we’re going to integrate it into our enabling technology offerings and use some of those capabilities going forward. And as we build further strategies, we have a feeling that there’s a good place for this long term. I don’t think it will be a major growth driver of us, but I think there are things in it that can help us further penetrate the market.
Caitlin Cronin: Awesome. Thank you. And then just a quick one. Any update on the timing for the augmented reality headset?
Daniel Scavilla: I would say still back half of the year. That’s one where we need to get that filed and approved through. We feel good about it. We’re ready to do it, but it’s in queue right now just to get through our processes.
Operator: Thank you for your question. Please stand by for our next question. Our next question comes from the line of Matthew O’Brien of Piper Sandler. Your line is now open.
Unidentified Analyst: This is Phil on for Matt. Thanks for taking our questions and congrats on the great quarter. Just for starters on the EBITDA and EBITDA margin. One quick clarification point. Does the 1.165 [ph] number include the onetime adjustment of $9.5 million. And I guess just bigger picture. You said in the past that on year 3 post the closing, you’d be back in the kind of mid-30s as far as EBITDA margin goes, a lot of leverage that you’re expecting over the next, I guess, 3 years to get it to just even 33%. So just talk about the confidence in getting back to that mid-30s EBITDA margin.
Keith Pfeil: I want to make sure I understand – I understood the first part of your question. You said the $9.5 million, was that included or excluded?
Unidentified Analyst: Yes, in the EBITDA.
Keith Pfeil: Yes. That was depreciation expense, so that would not be part of EBITDA. So that would not be in the results for EBITDA or adjusted EBITDA. As we think about longer term, getting back to mid-30s, we believe that we can absolutely get back to mid-30s. You’re going to see cost leverage occur with the business as you drive the synergies forward and you’re going to still expect to drive sales growth. I mean our intent here, this year is, as Dan stated earlier, a little bit of a transition from the standpoint of bringing the sales forces together and driving disruption. But as you look ahead, the goal is to get back to the high single-digit growth as a combined organization that will help drive additional cost leverage on top of the cost savings to get you back into that mid-30s range.
Daniel Scavilla: Yes. And Phil, I’ll just add into it. I feel pretty good with this. What we’re saying through our script and through our answers, we’re investing everywhere that we need to invest to bring these to reality. We have the capabilities of doing this, whether it’s machines or in-house manufacturing or renegotiations of some of our services or even third-party activities for some of our instrumentation. Everything is in play that would take us on the path. And I think both Keith and I feel really confident that we have multiple pathways or levers to get us up into the ranges where we want to be.
Unidentified Analyst: That’s helpful. And I guess just my last question. As it pertains to stock purchases in the quarter, curious to get your take if that was more opportunistic given where the stock price is at or more ongoing? And then how that impacts your ability to do any tuck-in M&A, which you’ve called out as a priority in the past.
Daniel Scavilla: Yes, I’m going to answer that one, too. So the answer is a little bit of both. But we’re absolutely taking advantage of what we feel is an undervalued stock, and we’re going to take that back and remove some of the dilution we created and even add more earnings per share power as we go forward in the future. I think that’s one of the strongest things that we’re doing here is using a strong cash flow to take advantage of something that we think has been overdone so that we can actually benefit from it over the long term.
Keith Pfeil: And as it relates to tuck-in acquisitions, as I look at where we’re at right now, the business is generating strong cash. We’re sitting on still a large cash balance. The business is generating profits. And as we look ahead, we’re really not limited by our balance sheet to go do tuck-ins. We have ample cash on hand plus we have an untapped line of credit should we want to do anything. So I don’t see that limiting us as we look at tuck-ins moving ahead.
Unidentified Analyst: Thanks so much.
Keith Pfeil: Thank you.
Operator: Thank you for your question. Please stand by for our next question. Our next question comes from the line of Richard Newitter of Truist Securities. Your line is now open.
Ravi Mishra: Hi, good evening. This is Cin for Rich. So I guess I had questions on the robot, both the current and potential future robot that’s coming to market. Could you maybe – on kind of Excelsius, could you help paint a picture maybe around utilization in terms of what you’re seeing with accounts that have now had this for a few years versus new accounts and where things can go for new placements? And then around the future robot, I believe I heard you say that you’re kind of contemplating inventory build right now ahead of approval. How should we think about the impact to gross margin once sales begin post approval? Thank you.
Daniel Scavilla: So Ravi, I’ll answer that. So let’s start with the latter part of that is the Ortho robot coming out. Again, I think what that will be is in a different marketplace that will allow us to have more volume ramp-up of our implants of knees and hips. And so I think that there’ll be a benefit there to the overall business that we look at that way coming forward. I don’t see it as any type of significant degradation on where we’re going pressure-wise along those lines. If you get back to your first part of the utilization for the Excelsius spine robot, obviously, it’s different in different accounts with different needs. But what we’ve seen is a growing strength and growing usage, there are sites that have multiple robots at this point and not just 1 or 2 sites, but several where they build this in and really integrate it and get enough usage that they need more than 1 or 2 or even 3 in some cases.
So we are really seeing a lot of activity of high usage and sites that are buying multiple robots at this point.
Operator: Okay. Thank you. This does conclude today’s conference, the Globus Medical earnings call. Thank you for participating. You may now disconnect.+
