About Non-GAAP Gross Margin and Non-GAAP Operating Margin As part of our Investor Day on Tuesday
Tuesday, May 6, 2025 1 min read
Key Takeaway: ALIGN Technology shared its financial outlook during the Investor Day scheduled for May 6, 2025. The updated projections include non-GAAP gross margins of 71.0-73.0% for 2026-2028 and 73% for 2029 and beyond. Additionally, the non-GAAP operating margins are anticipated to increase from 22.5% in 2025 to 25.0% by 2029. The figures exclude stock-based compensation and amortization of intangibles, providing a clearer view of the company's operational performance.
Market Sentiment Analysis
POSITIVE FACTORS
The non-GAAP gross margin is projected to be high, indicating strong performance.
The operating margin outlook shows an increase over the years, suggesting growth.
Exclusion of stock-based compensation presents a clearer picture of operational efficiency.
Full Press Release Details
About Non-GAAP Gross Margin and Non-GAAP Operating Margin
As part of our Investor Day on Tuesday, May 6, 2025 we provided a financial model that included our outlook for non-GAAP gross margin and non-GAAP operating margin. These non-GAAP financial measures exclude the effects of stock-based compensation and the amortization of intangibles related to certain acquisitions that are included in the most directly comparable GAAP financial measure as these items may not be indicative of our fundamental operating performance.
ALIGN TECHNOLOGY, INC.
UNAUDITED GAAP TO NON-GAAP RECONCILIATION
GROSS MARGIN OUTLOOK
2026 - 2028
2029+
GAAP gross margin
70.5-72.5%
72.5%
Stock-based compensation
0.2%
0.2%
Amortization of intangibles (1)
0.3%
0.3%
Non-GAAP gross margin
71.0-73.0%
73%
OPERATING MARGIN OUTLOOK
2025
2026 - 2028
2029+
GAAP operating margin
17.0%
17.5-19.5%
19.5%
Stock-based compensation
5.0%
5.0%
5.0%
Amortization of intangibles (1)
0.5%
0.5%
0.5%
Non-GAAP operating margin
22.5%
23.0-25.0%
25.0%
(1) Amortization of intangible assets related to certain acquisitions.
Frequently Asked Questions
What is non-GAAP gross margin?
Non-GAAP gross margin reflects financial performance excluding stock-based compensation and amortization of intangibles.
What are the GAAP and non-GAAP gross margins for 2026?
The GAAP gross margin for 2026 is 70.5-72.5%, while the non-GAAP gross margin is 71.0-73.0%.
How does stock-based compensation affect margins?
Stock-based compensation impacts both non-GAAP gross and operating margin calculations.
What does the operating margin outlook indicate?
The operating margin outlook forecasts GAAP margins to improve from 17.0% to 19.5% by 2029.
What is the non-GAAP operating margin for 2025?
The non-GAAP operating margin for 2025 is projected to be 22.5%.