Align Technology, Inc.

What they do

Align designs, manufactures, and markets Invisalign clear aligners for orthodontic treatment, iTero intraoral scanners, and exocad CAD/CAM software for dental laboratories and practitioners. The company operates through two segments: Clear Aligner and Imaging Systems and CAD/CAM Services. Clear Aligner represented approximately 80% of 2025 net revenues, with the remaining 20% from Systems and Services.

Revenue drivers

• Clear Aligner segment — Invisalign clear aligner shipments and related doctor/consumer accessories; ~80% of 2025 revenue. Q2 2026 revenue of $870.9M, up 8.2% year-over-year, on shipments of 691.8 thousand cases.
• Imaging Systems and CAD/CAM Services — iTero intraoral scanners and exocad software; ~20% of 2025 revenue. Q2 2026 revenue of $185.3M, down 10.8% year-over-year due to capital equipment market softness and mix shift to lower-priced scanners and leasing/rental models.
• International growth — Double-digit international Clear Aligner volume growth in Q2 2026, led by EMEA and APAC regions, while North America remained stable.
• Customer and patient segment expansion — Growth across orthodontists and GP dentists, and across adult, teen, and kid patient segments.

Recent performance

Q2 2026 total revenues of $1.056 billion, up 4.3% year-over-year, with record quarterly revenue. Clear Aligner revenues grew 8.2% year-over-year, while Systems and Services revenues declined 10.8%. Gross margin was 71.7% (72.3% non-GAAP), and diluted EPS was $1.51 GAAP and $2.64 non-GAAP. Cash and equivalents were $1.10 billion at June 30, 2026.

Strategy

Align's strategy centers on the Align Digital Platform to integrate clear aligners, scanners, and CAD/CAM software for a seamless digital workflow. Key priorities include expanding clear aligner adoption among orthodontists and GPs, driving scanner and software sales, and pursuing international growth. The company plans to open a manufacturing facility in Hyderabad, India in 2027. Management also focuses on controlling spending while investing in R&D and sales and marketing.

Risks

• Macroeconomic pressure on consumer spending — Economic downturns or reduced discretionary income can decrease elective orthodontic case starts and shift patients to less costly treatments.
• Foreign exchange volatility — Q2 2026 revenues were favorably impacted by $12.5M year-over-year but unfavorably by $6.1M sequentially; FX can materially affect margins and EPS.
• Capital equipment market softness — Imaging Systems and CAD/CAM Services revenue fell 10.8% in Q2 2026, reflecting weaker demand and a mix shift to lower-priced scanners and rental models.
• Competition and substitution risk — Doctors may revert to traditional wires and brackets, and competitors may offer lower-cost aligner alternatives, pressuring pricing and volumes.

Outlook

Management expects continued growth in Clear Aligner volumes, driven by international markets and expansion across patient segments. They anticipate continued softness in the capital equipment market for the Imaging Systems segment. The company plans to manage expenses while investing in strategic initiatives, including the India manufacturing facility. Foreign exchange is expected to remain a headwind on a sequential basis, but a tailwind year-over-year.