Dental technology company Align Technology (NASDAQ: ALGN) reported Q1 CY2026 results beating Wall Street’s revenue expectations, with sales up 6.2% year on year to $1.04 billion. The company expects next quarter’s revenue to be around $1.05 billion, close to analysts’ estimates. Its non-GAAP profit of $2.58 per share was 12.8% above analysts’ consensus estimates.
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Align Technology (ALGN) Q1 CY2026 Highlights:
- Revenue: $1.04 billion vs analyst estimates of $1.02 billion (6.2% year-on-year growth, 1.8% beat)
- Adjusted EPS: $2.58 vs analyst estimates of $2.29 (12.8% beat)
- Adjusted Operating Income: $223.8 million vs analyst estimates of $201.5 million (21.5% margin, 11.1% beat)
- Revenue Guidance for Q2 CY2026 is $1.05 billion at the midpoint, roughly in line with what analysts were expecting
- Operating Margin: 13.6%, in line with the same quarter last year
- Sales Volumes were up 6.7% year on year
- Market Capitalization: $12.7 billion
Company Overview
Pioneering an alternative to traditional metal braces with nearly invisible plastic aligners, Align Technology (NASDAQ: ALGN) designs and manufactures Invisalign clear aligners, iTero intraoral scanners, and dental CAD/CAM software for orthodontic and restorative treatments.
Revenue Growth
A company’s long-term sales performance is one signal of its overall quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul. Thankfully, Align Technology’s 7.8% annualized revenue growth over the last five years was decent. Its growth was slightly above the average healthcare company and shows its offerings resonate with customers.
Long-term growth is the most important, but within healthcare, a half-decade historical view may miss new innovations or demand cycles. Align Technology’s recent performance shows its demand has slowed as its annualized revenue growth of 2.3% over the last two years was below its five-year trend. We’re wary when companies in the sector see decelerations in revenue growth, as it could signal changing consumer tastes aided by low switching costs. 
This quarter, Align Technology reported year-on-year revenue growth of 6.2%, and its $1.04 billion of revenue exceeded Wall Street’s estimates by 1.8%. Company management is currently guiding for a 3.7% year-on-year increase in sales next quarter.
Looking further ahead, sell-side analysts expect revenue to grow 3.1% over the next 12 months, similar to its two-year rate. This projection doesn't excite us and implies its newer products and services will not lead to better top-line performance yet.
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Adjusted Operating Margin
Adjusted operating margin is an important measure of profitability as it shows the portion of revenue left after accounting for all core expenses – everything from the cost of goods sold to advertising and wages. It’s also useful for comparing profitability across companies because it excludes non-recurring expenses, interest on debt, and taxes.
Align Technology has been an efficient company over the last five years. It was one of the more profitable businesses in the healthcare sector, boasting an average adjusted operating margin of 22.8%.
Analyzing the trend in its profitability, Align Technology’s adjusted operating margin decreased by 3.6 percentage points over the last five years, but it rose by 1.6 percentage points on a two-year basis. Still, shareholders will want to see Align Technology become more profitable in the future.
In Q1, Align Technology generated an adjusted operating margin profit margin of 21.5%, up 2.5 percentage points year on year. This increase was a welcome development and shows it was more efficient.
Earnings Per Share
We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.
Align Technology’s remarkable 9.4% annual EPS growth over the last five years aligns with its revenue performance. This tells us it maintained its per-share profitability as it expanded.
In Q1, Align Technology reported adjusted EPS of $2.58, up from $2.13 in the same quarter last year. This print easily cleared analysts’ estimates, and shareholders should be content with the results. Over the next 12 months, Wall Street expects Align Technology’s full-year EPS of $10.97 to grow 5.1%.
Key Takeaways from Align Technology’s Q1 Results
It was good to see Align Technology beat analysts’ EPS expectations this quarter. We were also happy its revenue outperformed Wall Street’s estimates. On the other hand, its revenue guidance for next quarter was in line. Overall, this print had some key positives. The stock remained flat at $179 immediately after reporting.
Indeed, Align Technology had a rock-solid quarterly earnings result, but is this stock a good investment here? What happened in the latest quarter matters, but not as much as longer-term business quality and valuation, when deciding whether to invest in this stock. We cover that in our actionable full research report which you can read here (it’s free).
