AVANOS MEDICAL, INC.AVNS
AVANOS MEDICAL, INC. Segments Disclosure
Segment Information
We define our reportable segments based on the way our CODM manages the operations of the business for purposes of allocating resources and assessing performance. During the first quarter of 2025, our CODM began managing the business at a disaggregated level beyond our previously defined medical devices segment. Accordingly, we conduct our business in two operating and reportable segments.
Prior year amounts have been reclassified to conform with the current year presentation. Our reportable segments include the following:
Specialty Nutrition Systems is a portfolio of products including:
•Enteral feeding, which includes products such as our MIC-KEY enteral feeding tubes and Corpak patient feeding solutions; and
•Neonate solutions, which includes NeoMed neonatal and pediatric feeding solutions and Nexus’ TKO® anti-reflux needleless connectors.
Pain Management and Recovery is a portfolio of products including:
•Surgical pain and recovery products such as ON-Q and ambIT surgical pain pumps and Game Ready cold and compression therapy systems; and
•RFA solutions, which provide minimally invasive pain relief therapies, such as our COOLIEF, Trident and ESENTEC RFA products used to treat chronic pain conditions. The CODM, our Chief Executive Officer, assesses performance for our reportable segments and decides how to allocate resources based on net income from continuing operations, which is also presented in the Consolidated Income Statements. The CODM uses net income from continuing operations for strategic planning, including revenue generation, cost management and investment decisions, as well as in the annual budget and forecasting process. Additionally, the CODM uses net income from continuing operations to evaluate income generated from assets and earnings generated per share.
The CODM, our Chief Executive Officer, evaluates the performance of our two reportable segments and determines how to allocate resources based on Operating Income (Loss), adjusted for goodwill impairment loss, and is regularly provided with segment revenues and expenses. The CODM uses Operating Income (Loss), adjusted for goodwill impairment loss for strategic planning, including revenue generation, cost management and investment decisions, as well as in the annual budget and forecasting process. Additionally, the CODM uses Operating Income (Loss) adjusted for goodwill impairment loss to evaluate income generated from assets and earnings generated per share. The CODM receives and reviews total assets as presented in the Consolidated Balance Sheets, and does not evaluate asset information at the segment level. The significant expenses included in Operating Income (Loss), as regularly provided to the CODM, are as follows (in millions):
| Year Ended December 31, 2025 | |||||||||||||||||
| SNS | PM&R | Total | |||||||||||||||
| Net Sales | $ | 432.9 | $ | 237.8 | $ | 670.7 | |||||||||||
| Reconciliation of consolidated net sales: | |||||||||||||||||
Corporate and other(a) | 30.5 | ||||||||||||||||
| Total consolidated net sales | $ | 701.2 | |||||||||||||||
| Cost of goods sold | (165.1) | (85.6) | |||||||||||||||
| Distribution | (24.9) | (12.6) | |||||||||||||||
| Research and development expenses | (16.7) | (4.8) | |||||||||||||||
| Advertising, promotion and selling expenses | (53.6) | (62.3) | |||||||||||||||
| General expenses | (69.5) | (48.5) | |||||||||||||||
| Depreciation and amortization expense | (20.4) | (14.7) | |||||||||||||||
| Other segment items | (0.1) | (0.1) | |||||||||||||||
| Reportable segment operating income | $ | 82.6 | $ | 9.2 | $ | 91.8 | |||||||||||
Corporate and other(b) | (153.4) | ||||||||||||||||
| Interest expense, net | (4.6) | ||||||||||||||||
| Loss before income taxes | $ | (66.2) | |||||||||||||||
| Year Ended December 31, 2024 | |||||||||||||||||
| SNS | PM&R | Total | |||||||||||||||
| Net Sales | $ | 396.4 | $ | 234.2 | $ | 630.6 | |||||||||||
| Reconciliation of consolidated net sales: | |||||||||||||||||
Corporate and other(a) | 57.2 | ||||||||||||||||
| Total consolidated net sales | $ | 687.8 | |||||||||||||||
| Cost of goods sold | (135.6) | (84.3) | |||||||||||||||
| Distribution | (24.7) | (10.5) | |||||||||||||||
| Research and development expenses | (17.3) | (7.3) | |||||||||||||||
| Advertising, promotion and selling expenses | (67.0) | (78.0) | |||||||||||||||
| General expenses | (54.6) | (38.0) | |||||||||||||||
| Depreciation and amortization expense | (16.4) | (13.4) | |||||||||||||||
| Reportable segment operating income | $ | 80.8 | $ | 2.7 | $ | 83.5 | |||||||||||
Corporate and other(b) | (479.7) | ||||||||||||||||
| Interest expense, net | (7.1) | ||||||||||||||||
| Loss before income taxes | $ | (403.3) | |||||||||||||||
| Year Ended December 31, 2023 | |||||||||||||||||
| SNS | PM&R | Total | |||||||||||||||
| Net Sales | $ | 371.6 | $ | 227.3 | $ | 598.9 | |||||||||||
| Reconciliation of consolidated net sales: | |||||||||||||||||
Corporate and other(a) | 74.4 | ||||||||||||||||
| Total consolidated net sales | $ | 673.3 | |||||||||||||||
| Cost of goods sold | (125.4) | (82.0) | |||||||||||||||
| Distribution | (22.2) | (11.9) | |||||||||||||||
| Research and development expenses | (14.6) | (9.8) | |||||||||||||||
| Advertising, promotion and selling expenses | (60.1) | (75.2) | |||||||||||||||
| General expenses | (51.5) | (38.8) | |||||||||||||||
| Depreciation and amortization expense | (17.8) | (13.3) | |||||||||||||||
| Other segment items | — | — | |||||||||||||||
| Reportable segment operating income | $ | 80.0 | $ | (3.7) | $ | 76.3 | |||||||||||
| Corporate and other | (72.1) | ||||||||||||||||
| Interest expense, net | (12.1) | ||||||||||||||||
| Loss before income taxes | $ | (7.9) | |||||||||||||||
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(a)Corporate and other net sales includes revenue from our Hyaluronic Acid (“HA”) injections and our IV infusion oncology pumps.
(b)Corporate and other expenses includes $77.0 million of goodwill impairment associated with our PM&R reporting unit. See Note 2, “Goodwill and Intangibles Impairment” for further information.
For the years ended December 31, 2025, 2024 and 2023, net sales to external customers in the United States were $523.2 million, $529.1 million and $467.0 million, respectively. Globally, one customer accounted for 10% or more of our consolidated net sales in the year ended December 31, 2025 and two customers accounted for 10% or more of our consolidated net sales in the years ended December 31, 2024 and 2023.
Property, plant and equipment held domestically and in foreign countries is as follows (in millions):
| As of December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| Domestic | $ | 66.1 | $ | 72.7 | |||||||
| Foreign | 47.3 | 38.0 | |||||||||
| Total Property, Plant and Equipment | $ | 113.4 | $ | 110.7 | |||||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 24, 2026 | Showing above |
| 2024 | Feb 26, 2025 | |
| 2023 | Feb 21, 2024 | |
| 2022 | Feb 21, 2023 | |
| 2017 | Feb 27, 2018 | |
| 2016 | Feb 27, 2017 | |
| 2015 | Feb 29, 2016 | |
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.