Results
5Record Q2'26 revenues of $1.06 billion increased 4.3% year-over-year, reflecting 8.2% growth from Clear Aligner revenues and a 10.8% decrease in Systems and Services revenues
Record Clear Aligner shipments of 691.8 thousand increased 7.4% year-over-year, led by double-digit international growth and stable North America performance
Management commentary
Year-over-year growth continued across key customer channels and patient segments, including orthodontists and GP dentists, as well as adult, teen, and kid patients
Results
Q2'26 total revenues were $1,056.2 million, up 1.5% sequentially and up 4.3% year-over-year
Q2'26 total revenues were unfavorably impacted by foreign exchange by approximately $6.1 million sequentially, and favorably impacted by approximately $12.5 million year-over-year (1)
Q2'26 Clear Aligner revenues of $870.9 million increased 8.2% year-over-year, and Clear Aligner volume increased 7.4% year-over-year to 691.8 thousand cases
Q2'26 Imaging Systems and CAD/CAM Services revenues of $185.3 million, increased 0.7% sequentially and decreased 10.8% year-over-year, reflecting softness in the capital equipment market and a mix shift toward lower-priced scanners and flexible acquisition models, including leasing and rental programs
Q2'26 gross margin of 71.7% was unfavorably impacted by foreign exchange by approximately 0.2 points sequentially and by approximately 0.8 points year-over-year.
(1) On a non-GAAP basis, Q2'26 gross margin was 72.3% (1) , up 1.8 points year-over-year or up approximately 2.6 points at constant currency
Q2'26 operating margin of 14.6% was unfavorably impacted by foreign exchange by approximately 0.6 points sequentially and by approximately 1.4 points year-over-year.
(1) On a non-GAAP basis, Q2'26 operating margin was 22.9% (1) , up 1.6 points year-over-year or up approximately 3.1 points at constant currency.
Q2'26 diluted net income per share was $1.51, non-GAAP diluted net income per share was $2.64.
(1) Both Q2'26 GAAP and non-GAAP EPS were unfavorably impacted by approximately $0.23 on a year-over-year basis due to foreign exchange
Q2'26 cash and cash equivalents were $1,102.6 million compared to approximately $1,059.8 million as of March 31, 2026
Capital return
Repurchased approximately 0.4 million shares, returning approximately $67.0 million to shareholders
Results
TEMPE, Ariz., July 29, 2026 -- Align Technology, Inc. (Nasdaq: ALGN), a leading global medical device company that designs, manufactures, and sells the Invisalign ® System of clear aligners, iTero™ intraoral scanners, and exocad™ CAD/CAM software for digital orthodontics and restorative dentistry, today reported financial results for the second quarter ("Q2'26").
Q2'26 total revenues were $1,056.2 million, up 1.5% sequentially and up 4.3% year-over-year.
Q2'26 total revenues were unfavorably impacted by foreign exchange by approximately $6.1 million, or 0.6% sequentially, and favorably impacted by approximately $12.5 million, or 1.2% year-over-year.
(1) Q2'26 Clear Aligner revenues were $870.9 million, up 1.7% sequentially and up 8.2% year-over-year.
Q2'26 Clear Aligner revenues were unfavorably impacted by foreign exchange by approximately $5.1 million, or 0.6% sequentially, and favorably impacted by approximately $10.6 million, or 1.2% year-over-year.
(1) Q2'26 Clear Aligner volume of 691.8 thousand cases was up 0.9% sequentially and up 7.4% year-over-year.
Q2'26 Imaging Systems and CAD/CAM Services revenues were $185.3 million, up 0.7% sequentially and down 10.8% year-over-year.
Q2'26 Imaging Systems and CAD/CAM Services revenues were unfavorably impacted by foreign exchange by approximately $1.0 million, or 0.5% sequentially, and favorably impacted by approximately $1.9 million, or 1.0% year-over-year.
Q2'26 gross profit was $757.4 million, resulting in a gross margin of 71.7%.
Q2'26 gross margin was unfavorably impacted by foreign exchange by approximately 0.2 points sequentially.
(1) On a constant currency basis, excluding the unfavorable foreign exchange impact, Q2'26 gross margin would have been approximately 72.0%.
On a year-over-year basis, Q2'26 gross profit was unfavorably impacted by foreign exchange by approximately 0.8 points.
(1) On a constant currency basis, excluding the unfavorable foreign exchange impact, Q2'26 gross margin would have been approximately 72.5%.
On a non-GAAP basis, Q2'26 gross profit was $763.1 million, resulting in a gross margin of 72.3%.
Q2'26 operating income was $154.0 million, resulting in an operating margin of 14.6%.
Q2'26 operating income was unfavorably impacted by an estimated $37.5 million liability, inclusive of interest, related to UK VAT.
Q2'26 operating margin was unfavorably impacted by foreign exchange by approximately 0.6 points sequentially.
(1) On a constant currency basis, excluding the unfavorable foreign exchange impact, Q2'26 operating margin would have been approximately 15.2%.
On a year-over-year basis, Q2'26 operating margin was unfavorably impacted by foreign exchange by approximately 1.4 points.
(1) On a constant currency basis, excluding the unfavorable foreign exchange impact, Q2'26 operating margin would have been approximately 16.0%.
(1) Q2'26 net income was $108.3 million, or $1.51 per diluted share.
Foreign exchange unfavorably impacted Q2'26 diluted net income per share by approximately $0.17 sequentially and by approximately $0.23 year-over-year.
On a non-GAAP basis, Q2'26 net income was $189.1 million, or $2.64 per diluted share.
Management commentary
Commenting on Align's Q2'26 results, Align Technology President and CEO Joe Hogan said, “We delivered a solid second quarter with record revenues of $1.06 billion, up 4.3% year-over-year, driven by record Clear Aligner volumes of 691.8 thousand cases and 8.2% Clear Aligner revenue growth.
Q2'26 revenues and Clear Aligner volumes were in line with our outlook, while Clear Aligner ASPs and non-GAAP operating margin of 22.9%
exceeded our expectations.
Q2’26 year-over-year Clear Aligner volume growth of 7.4% was driven by continued double-digit expansion across APAC, EMEA, and Latin America, together with stable performance in North America.
Growth reflected continuing adoption across orthodontist and GP dentist channels and across adult, teen, and growing patient segments, as well as continued double-digit growth from DSOs.
Investments in patient financing, clinical support programs, doctor subscription offerings, and practice productivity solutions supported adoption and utilization across our global Invisalign business.
In Systems and Services, Q2’26 revenue performance reflected persistent softness in the capital equipment market as well as a shift toward lower-priced scanners and flexible acquisition models, including leasing and rental programs, which generate lower upfront revenue than traditional scanner purchases.
By lowering the upfront cost of adoption, we can expand patient access to care, grow recurring revenue, and strengthen the Align™ Digital Platform."
Results
Financial Summary - Second Quarter Fiscal 2026
As of June 30, 2026, we had approximately $1,102.6 million in cash and cash equivalents, compared to approximately $1,059.8 million as of March 31, 2026.
As of June 30, 2026, we had $300.0 million available under our revolving line of credit and a $50.0 million letter of credit sub-limit.
Management commentary
Commenting on Align's Q2'26 results, Align Technology CFO and EVP Global Finance, John Morici said, "Our second quarter results reflect continued execution across the business.
Solid Clear Aligner performance, disciplined expense management, and operational improvements supported revenue growth in-line with our outlook and non-GAAP operating margin above our expectations.
Our growth initiatives continue to drive doctor adoption, utilization, and patient conversion.
While Q2’26 Systems and Services revenue was below our original expectations, underlying scanner adoption remained healthy, and the reported lower revenues reflects lower price scanners and the transition toward lease and rental models that increase access to care by offering a broader range of purchasing options and increasing adoption of our digital scanning technology.
This is a deliberate trade-off on our part.
While this model may impact upfront economics and timing of revenue recognition, it enables us to serve more customers and to drive for higher-margin treatment revenue and durable long-term growth.
Stronger Clear Aligner revenue
growth and ASP performance helped offset the near-term impact.
As more than 23 million patients have now been treated with the Invisalign ® System, we believe our integrated digital platform and disciplined execution position us to support customer growth, expand adoption, and drive long-term profitable growth.
Our strong balance sheet and healthy free cash flow generation continue to provide flexibility to invest in innovation, support our customers, and return capital to shareholders.
During the quarter we repurchased approximately 0.4 million shares, at an average price of $169.45 per share, returning approximately $67 million to shareholders, and ended the quarter with more than $1.1 billion in cash and cash equivalents.
We remain committed to disciplined capital allocation, maintaining financial flexibility, and creating long-term value for shareholders."
Commenting on Align’s fiscal 2026 outlook, Hogan continued, “As we enter the second half of 2026, we believe we are well positioned to build on the momentum we saw in the first half of the year.
We are entering the important teen treatment season with one of the industry's most comprehensive digital treatment portfolios for growing patients and teens.
At the same time, we continue to expand opportunities in adult treatment through innovations that connect oral health, restorative workflows, and digital orthodontics, helping doctors incorporate Invisalign ® treatment into broader patient care discussion.
Our innovation engine remains a key differentiator and central to our growth strategy.
Business model innovation, patient financing, subscription programs such as DSP, no-AA offerings, and digital workflow innovation are helping doctors improve patient conversion, increase utilization, and grow their practices.
Every digital workflow begins with a scan, making scanner adoption important driver to increasing patient access to orthodontic care and long-term platform growth.
As we continue to advance our innovation roadmap and direct fabrication technologies, we are creating more effective and personalized treatment solutions that improve clinical outcomes, enhance operating efficiency, and strengthen the customer experience across orthodontics and restorative dentistry.”
Capital return
Q2'26 Stock Repurchase
During Q2'26, we repurchased approximately 393.4 thousand shares of our common stock at an average price of $169.45 per share.
These purchases were made pursuant to the $200.0 million open market repurchase plan announced on April 29, 2026, which we expect will be completed in October 2026.
As of June 30, 2026, $733.3 million remains available for repurchases of our common stock under our $1.0 billion stock repurchase program announced in April 2025.
Management commentary
Tariff Update as of June 30, 2026
As a result of the Supreme Court's ruling on February 20, 2026, that certain of the tariffs imposed under the International Emergency Economic Powers Act (“IEEPA”) were unlawful, we are no longer subject to IEEPA tariffs, but are subject to new, temporary tariffs on imports under Section 122 of the Trade Act of 1974, effective
Corporate events
February 24, 2026, which was subsequently held unlawful by the U.S. Court of International Trade in a decision that remains subject to appeal.
We do not expect this change to have a material impact on our results.
Following the First-tier Tribunal's 2025 decision that clear aligners qualify as VAT-exempt dental prostheses, we stopped charging VAT to UK customers effective August 1, 2025.
On July 7, 2026, the UK Upper Tribunal overturned that decision, determining that clear aligners do not qualify as VAT-exempt dental prostheses.
We acknowledge the ruling and will comply with applicable law.
Effective September 7, 2026, invoices will include UK VAT at 20% on applicable Invisalign® aligners and Vivera™ retainers — our list prices remain unchanged.
As a result of the ruling, we have recorded an estimated liability of approximately $37.5 million, inclusive of interest.
We intend to appeal, though the ultimate resolution remains subject to uncertainty.
Outlook
Fiscal 2026 Business Outlook
Q3'26:
We expect Q3’26 worldwide revenues to be in the range of $1,000M to $1,020M, down sequentially from Q2’26.
We expect Q3’26 Clear Aligner volume to be up mid-single digits year-over-year and Q3’26 Clear Aligner ASP to be down sequentially from geographic mix and foreign exchange.
We expect Q3'26 Systems & Services revenue to be down sequentially and year-over-year as a result of Q3 seasonality alongside a continued mix shift towards lower-priced scanners and flexible acquisition models, including leasing and rental units, and certified pre-owned offerings.
1We expect Q3’26 worldwide GAAP Gross Margin to be 67.5% to 68.5%, down sequentially approximately by 3 to 4 points, due to the incurrence of one-time charges expected to be approximately $20 to $30 million primarily for accelerated depreciation and restructuring and other charges in Q3'26.
7We expect Q3'26 non-GAAP Gross Margin to be approximately 71.0%, down sequentially from lower ASPs, consistent with typical Q3 quarter-over-quarter trends.
We expect our Q3’26 GAAP Operating Margin to be between 13.5% and 15.0%, due to the incurrence of one-time charges expected to be approximately $35 to $50 million primarily for restructuring and other charges, and accelerated depreciation in Q3'26.
We expect Q3'26 non-GAAP Operating Margin to be approximately 24.0%.
For Fiscal 2026:
We continue to expect 2026 worldwide revenue growth to be up 3% to 4% year-over-year.Guidance reaffirmed
Our full year 2026 revenue guidance continues to assume a benefit from foreign exchange that is consistent with the assumptions underlying our initial full year outlook.Guidance reaffirmed
We expect the impact of foreign exchange to moderate in the remaining quarters, trending toward the full-year assumption of approximately 100 basis points.
We now expect 2026 Clear Aligner volume growth to be up approximately 6% year-over-year and 2026 Clear Aligner ASP to be flat to slightly down from 2025.
Align Technology Announces Second Quarter 2026 Financial Results
2We now expect 2026 Systems & Services revenue growth to be down 6% to 8% year-over-year as we anticipate a continued mix shift towards lower-priced scanners and more flexible acquisition models in 2H’26.
We expect our 2026 iTero scanner shipment growth to be up double-digits year-over-year, reflecting continued customer adoption and scanner placements - and helping to underpin our second half outlook for Invisalign volumes.
8We expect 2026 GAAP Gross Margin to be approximately 70.2% to 70.5%, up year-over-year by approximately 3 points, due to the incurrence of one-time charges expected to be approximately $30 to $40 million primarily for accelerated depreciation and restructuring and other charges, partially offset by gain on assets held for sale.
3We expect 2026 non-GAAP Gross Margin to be up approximately 100 basis points over 2025 non-GAAP Gross Margin.
We expect 2026 GAAP Operating Margin to be approximately 15.1% to 15.6%, up year-over-year by approximately 2 points, due to the incurrence of one-time charges expected to be approximately $90 to $110 million, primarily related to restructuring and other charges, accelerated depreciation, and legal settlements, partially offset by gain on assets held for sale.
In Q2'26 we recorded $38 million for clear aligner UK VAT liability.
We expect 2026 non-GAAP Operating Margin to be approximately 23.7%, a 100-basis point improvement year-over-year consistent with our previous guidance.Guidance reaffirmed
We expect our investments in capital expenditures for fiscal 2026 to be $125 million to $150 million.
Capital expenditures primarily relate to technology upgrades, additional manufacturing capacity as well as maintenance.
Capital return
We now expect to repurchase $400 million to $500 million of our common stock in 2026, reflecting the conviction of the Board and Management in Align's long-term value.
This includes approximately $133 million of our common stock we expect to repurchase through October 2026.
Outlook
Commenting on the Company’s outlook, Morici continued, “I want to take a moment to offer some preliminary, high-level framing for 2027, especially given the work we are doing to drive growth, cost discipline and margin expansion.
To be clear—we are not issuing formal guidance for next year—it’s too early and our strategic and operating model review is still underway.
However, we remain laser focused on executing our strategic plan for profitable revenue growth across our two operating segments.
6Based on our continued progress and the initiatives we outlined in the Strategic Initiatives press release today, we are comfortable targeting at least that same level of improvement in operating margin again in fiscal 2027, on top of the approximately 100 basis points of operating margin improvement we reiterated today for fiscal 2026.
4For fiscal 2027, we currently expect GAAP and non-GAAP operating margins to increase at least approximately 100 basis points year-over-year.
We’ll share more details after our strategic and operating model review is complete and in conjunction with formal 2027 guidance.”
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