Key Highlights

  • Sales Revenue was A$2,343.4 million, down 1% as reported and up 2% in constant currency.
  • Underlying NPAT fell 22% to A$322.4 million, with underlying EPS of A$4.93.
  • Implant units sold rose 5% to 56,692.
  • FY27 guidance is for underlying NPAT of A$330 million to A$350 million and low single-digit constant-currency sales growth.

In its FY26 results announcement of 18 August 2026, the hearing-implant maker guided to low single-digit constant-currency sales growth and underlying net profit of A$330 million to A$350 million for FY27, while pointing to the rapid uptake of its new Nucleus Nexa implant system and a plan to restore profit margins over the medium term. The company (ASX:COH) operates in this market.

The central development: a reset year

Cochlear makes cochlear implants, bone-conduction hearing devices and acoustic products, and provides services such as upgrades and sound-processor replacements. FY26 was a difficult year. Sales revenue was A$2,343.4 million, down 1% as reported but up 2% in constant currency (the second half grew 6% in constant currency). Underlying net profit was A$322.4 million, down 22% (21% in constant currency), and underlying Earnings Per Share were A$4.93, down 22%. Statutory net profit was A$147.3 million, down 62%, reflecting significant items including a A$109 million non-cash write-down on investments, mainly Epiminder.

underlying profit landed at the top end of the revised guidance.

Revenue drivers

Cochlear sold 56,692 implant units, up 5%, though implant revenue of A$1,435.2 million was flat in constant currency, which indicates that mix and pricing offset higher volume. Services revenue rose 6% to A$634.9 million and acoustics revenue rose 1% to A$273.3 million.

Nucleus Nexa, which the company describes as the first smart cochlear implant with upgradeable firmware, reached more than 95% of implant sales across developed markets by June 2026, with an average 3% price increase achieved. A rapid product transition of this kind supports pricing and future upgrade revenue, but also drives launch costs and production variances.

Geography

In developed markets implant revenue rose 1% in constant currency: the US was up 4%, Western Europe down 8% and Asia Pacific up 7%. Emerging markets fell 2%, with Latin America and Eastern Europe growing while the Middle East and China declined. The US is the largest and most important market, and referral pathways and insurance approvals there are cited by the company as obstacles.

Dividends and cash

The total Dividend was A$3.45 per share (A$2.15 interim and A$1.30 final), down 20%, at a 70% payout ratio. R&D spending rose 15%.

FY27 guidance in detail

Management guided to:

low single-digit constant-currency sales growth;

underlying net profit of A$330 million to A$350 million;

gross Margin of about 70% to 71%;

capital expenditure of A$100 million to A$110 million;

about A$60 million after tax of cloud expense to be reported as a significant item.

The company assumes exchange rates of 70 US cents and 61 euro cents to dollar and says a more encouraging Australian dollar would reduce underlying net profit by about 10% compared with FY26 average rates.

Sector and competitive position

Cochlear is the global leader in cochlear implants, competing with Advanced Bionics (part of Sonova) and MED-EL, among others, with competition focused on technology, surgeon preference and clinical outcomes. Its Leadership is supported by long-term clinical relationships, a large installed base that drives service and upgrade revenue, and regulatory approvals. The structural opportunity is low penetration: only a small proportion of adults who might benefit receive an implant, which is why the company plans to accelerate adult growth through medical engagement and expanded referral pathways.

Risks identified by the company

The announcement lists inconsistent adult referral pathways and insurance approval delays in the US, elective surgery backlogs and industrial action in Western Europe, Middle East conflict affecting market access, volume-based procurement and reimbursement cuts in China lowering average selling prices, foreign exchange movements, and the assumption that Tariff settings remain unchanged.

Developments to monitor

Evidence that Nexa uptake lifts adult implant volumes and services revenue.

Gross margin against the 70% to 71% guide.

dollar against the US dollar and euro.

Progress on the cloud transition and the A$60 million after-tax significant item.

Net cash recovery and a potential restart of the buyback.

US referral and insurance developments, and China pricing.

The first-half FY27 result and any guidance update.