8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): April 26, 2016

NUVASIVE, INC.

(Exact name of registrant as specified in its charter)

Delaware	000-50744	33-0768598
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(I.R.S. Employer Identification Number)

7475 Lusk Boulevard, San Diego, California 92121

(Address of principal executive offices) (Zip Code)

(858) 909-1800

(Registrant’s telephone number, including area code)

n/a

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition.

On April 26, 2016, NuVasive, Inc. (the “Company”) issued a press release announcing its financial results for the quarter ended March 31, 2016. A copy of this press release is furnished as Exhibit 99.1 to this Current Report.

Item 7.01 Regulation FD Disclosure.

During a conference call scheduled to be held at 1:30 p.m. Pacific Time on April 26, 2016, the Company’s Chairman and Chief Executive Officer and Chief Financial Officer will discuss the Company’s results for the quarter ended March 31, 2016 and the Company’s outlook for the year ending December 31, 2016. The slide presentation for the conference call is furnished as Exhibit 99.2 to this Current Report.

The information contained in this Current Report and the Exhibits hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

99.1	Press release issued by NuVasive, Inc. on April 26, 2016
99.2	Slide presentation

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

NUVASIVE, INC.
By:	/s/ Jason D. Hanson
	Jason D. Hanson
	Executive Vice President, Strategy, Corporate Development and General Counsel

Date: April 26, 2016

EXHIBIT INDEX

Exhibit Number	Description
99.1	Press release issued by NuVasive, Inc. on April 26, 2016
99.2	Slide presentation

EX-99.1

Exhibit 99.1

NEWS RELEASE

NUVASIVE REPORTS FIRST QUARTER 2016 FINANCIAL RESULTS

Company Delivers Double-Digit Revenue Growth of 11.8% and

Profitability Expansion of 150 Basis Points

SAN DIEGO, CA – April 26, 2016 - NuVasive, Inc. (Nasdaq: NUVA), a leading medical device company focused on transforming spine surgery with minimally disruptive, procedurally-integrated solutions, announced today financial results for the quarter ended March 31, 2016.

First Quarter 2016 Highlights

• Revenue increased 11.8% to $215.1 million, or 12.3% on a constant currency basis;

• Non-GAAP operating profit margin up 150 basis points to 14.1%; GAAP operating profit margin of 5.7%;

• Non-GAAP diluted earnings per share of $0.31; GAAP diluted loss per share of $0.18;

• Free cash flow generation of $39.1 million;

• Completed acquisitions of Ellipse Technologies and Mega Surgical; and

• Enhanced capital structure with convertible notes issuance.

Gregory T. Lucier, Chairman and Chief Executive Officer of NuVasive, said, “NuVasive is off to a strong start to 2016 as we continue to drive innovation, growth and profitability. Our revenue performance was driven by the fifth consecutive quarter of increasing growth for our U.S. spinal hardware business which reached double-digits during the quarter, improved international growth as our targeted re-acceleration plans take hold, and the benefit of our newly acquired MAGEC^® and PRECICE^® technologies. At the same time, we delivered an impressive operating profit margin expansion of 150 basis points, reflecting our commitment to drive operational excellence.”

A full reconciliation of GAAP to non-GAAP measures can be found in the tables of this news release.

First Quarter 2016 Results

NuVasive’s financial results for the first quarter 2016 are inclusive of the completion of the acquisition of Ellipse Technologies, Inc. on February 11, 2016 and Mega Surgical on March 18, 2016. The Company’s first quarter 2016 financial performance also was impacted by the issuance of $650 million in convertible senior notes on March 16, 2016, which provided enhanced financial flexibility with a more attractive debt structure and extended maturities to 2021. The Company used the net proceeds from the notes offering to put in place a bond hedge to raise the effective conversion price of the convertible notes due 2021 to $80.00 and for repurchases of existing convertible notes due 2017. During the three months ended March 31, 2016, the Company repurchased $277 million principal amount of its convertible notes due 2017.

NuVasive reported first quarter 2016 total revenue of $215.1 million, an 11.8% increase compared to $192.4 million for the first quarter 2015. On a constant currency basis, first quarter 2016 total revenue increased 12.3% compared to the same period last year.

For the first quarter 2016, GAAP and non-GAAP gross profit was $160.9 million and $165.8 million, respectively, while GAAP and non-GAAP gross margin was 74.8% and 77.1%, respectively. These results compared to GAAP and non-GAAP gross profit of $146.7 million and GAAP and non-GAAP gross margin of 76.3% for the first quarter 2015. Total GAAP and non-GAAP operating expenses were $148.6 million and $135.5 million, respectively, for the first quarter of 2016. These results compared to GAAP and non-GAAP operating expenses of $91.2 million and $122.5 million, respectively, for the first quarter 2015.

The Company reported a GAAP net loss of $8.9 million, or $0.18 per share, for the first quarter 2016 compared to a GAAP net income of $31.6 million, or $0.61 per share, for the first quarter 2015. This decrease was primarily the result of the new convertible notes issuance and repurchases of existing convertible notes during the first quarter 2016 and the net litigation gains during the first quarter of 2015.

On a non-GAAP basis, the Company reported net income of $16.0 million, or $0.31 per share, for the first quarter 2016 compared to net income of $15.1 million, or $0.30 per share, for the first quarter 2015.

Cash, cash equivalents and short and long-term marketable securities were approximately $331.0 million at March 31, 2016.

Annual Guidance for 2016

The Company provided the following updated projections to its full year 2016 guidance, which contemplates the impact of the Ellipse Technologies and Mega Surgical acquisitions, its new convertible notes issuance and existing convertible notes repurchases, as well as expected changes in foreign currency rates:

• Revenue of approximately $928.0 million, or approximately 14.4% growth compared to revenue of $811.1 million for 2015, which includes approximately $53 million of revenue contribution from Ellipse Technologies;

• Non-GAAP diluted earnings per share of approximately $1.48, an increase of approximately 12.7% compared to non-GAAP diluted earnings per share of $1.31 for 2015;

• Non-GAAP operating profit margin of approximately 15.8%, an increase of approximately 40 basis points compared to 15.4% for 2015;

• Adjusted EBITDA margin of approximately 25.4%, an increase of approximately 20 basis points compared to 25.2% for 2015; and

• Non-GAAP effective tax expense rate of approximately 41.0%.

Supplementary Financial Information

For additional financial detail, please visit the Investor Relations section of the Company’s website at www.nuvasive.com to access Supplementary Financial Information.

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Reconciliation of Full Year EPS Guidance

				2016 Guidance
	2015
	Actuals			Prior 1, 2			Current 1, 3
GAAP net income per share	$	1.26		$	1.02		$	0.20
Impact of change from basic to diluted share count		0.03			0.05			—
GAAP net income per share, adjusted to diluted Non-GAAP share count	$	1.30		$	1.07		$	0.20
Loss on extinguishment of debt		—			—			0.34
Non-cash interest expense on convertible notes		0.31			0.32			0.38
Amortization of intangible assets		0.24			0.25			0.76
One-time and acquisition related items 4		0.15			0.08			0.19
Non-cash purchase accounting adjustments on acquisitions 5		—			—			0.29
Leasehold related charges		0.07			—			—
CEO transition related costs		0.07			—			—
Litigation liability		(0.82	)		—			—
Tax effect of adjustments 6		(0.01	)		(0.24	)		(0.69	)
Non-GAAP earnings per share	$	1.31		$	1.48		$	1.48
GAAP Weighted shares outstanding - basic		48,687			49,984			49,984
Non-GAAP Weighted shares outstanding - diluted 7		51,110			52,616			51,335

¹  Prior guidance provided February 11, 2016. Current guidance reflects guidance provided April 26, 2016, as updated for the anticipated impact of the Ellipse Technologies and Mega Surgical acquisitions, the convertible notes issuance (and convertible notes repurchases), as well as expected changes in currency

²  Effective tax expense rate of ~42% applied to GAAP earnings and ~41% applied to Non-GAAP earnings

³  Effective tax expense rate of ~63% applied to GAAP earnings and ~41% applied to Non-GAAP earnings

⁴  Acquisition related items include expenses associated with M&A related activity and as incurred

⁵  Purchase accounting related items include items which are GAAP related fair value adjustments which are recognized at the time of acquistion and amortized over a reasonable period of time.

⁶  The impact on results from taxes include tax effecting the adjustments above at the statutory rate as well as taking into account discrete items and including those discrete items in the annual effective tax rate calculation. The Company also includes those adjustments that would have benefited the tax rate in lieu of the above adjustments as part of the Company’s tax filings. The impact of the changes to the tax rate results in an annual estimated rate of ~41% on a non-GAAP basis.

⁷  Excludes the impact of share dilution of the convertible bond for which the Company has a hedge in place but is considered anti-dilutive under US GAAP in weighted average shares outstanding

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Reconciliation of Non-GAAP Operating Margin %

				2016 Guidance
(in thousands, except %)	2015 Actuals			Prior 1			Current 1
Non-GAAP Gross Margin % [A]		76.0	%		76.9	%		77.4	%
Non-cash purchase accounting adjustments on acquisitions 2		0.0	%		0.0	%		(1.6	%)
GAAP Gross Margin [D]		76.0	%		76.9	%		75.8	%
Non-GAAP Sales, Marketing & Administrative Expense [B]		56.4	%		55.5	%		56.0	%
Leasehold related charges		0.5	%		0.0	%		0.0	%
CEO transition related costs		0.4	%		0.0	%		0.0	%
One-time and acquisition related items 3		0.8	%		0.4	%		1.1	%
GAAP Sales, Marketing & Administrative Expense [E]		58.1	%		55.9	%		57.2	%
Non-GAAP Research & Development Expense [C]		4.3	%		5.6	%		5.6	%
One-time and acquisition related items 3		0.1	%		0.0	%		0.0	%
GAAP Research & Development Expense [F]		4.4	%		5.6	%		5.6	%
Litigation liability [G]		(5.2	%)		0.0	%		0.0	%
Intangible asset impairment [H]		0.0	%		0.0	%		0.0	%
Amortization of intangible assets [H]		1.5	%		1.4	%		4.2	%
Non-GAAP Operating Margin % [A-B-C]		15.4	%		15.8	%		15.8	%
GAAP Operating Margin % [D-E-F-G-H]		17.1	%		13.8	%		8.7	%

¹  Prior guidance provided February 11, 2016. Current guidance reflects guidance provided April 26, 2016, as updated for the anticipated impact of the Ellipse Technologies and Mega Surgical acquisitions, the convertible notes issuance (and convertible notes repurchases), as well as expected changes in currency

²  Purchase accounting related items include items which are GAAP related fair value adjustments which are recognized at the time of acquistion and amortized over a reasonable period of time.

³  Acquisition related items include expenses associated with M&A related activity and as incurred

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Reconciliation of EBITDA %

				2016 Guidance
(in thousands, except %)	2015 Actuals			Prior 1			Current 1
Net Income / (Loss)		8.2	%		6.1	%		1.1	%
Interest (income) / expense, net		3.4	%		3.5	%		6.1	%
Provision for income taxes		5.8	%		4.4	%		1.7	%
Depreciation and amortization 2		8.1	%		8.0	%		10.9	%
EBITDA		25.4	%		21.9	%		19.8	%
Non-cash stock based compensation		3.1	%		3.0	%		3.0	%
One-time and acquisition related items 3		0.9	%		0.4	%		1.1	%
Non-cash purchase accounting adjustments on acquisitions 4		0.0	%		0.0	%		1.6	%
Leasehold related charges 2		0.5	%		0.0	%		0.0	%
CEO transition related costs 5		0.4	%		0.0	%		0.0	%
Litigation liability		(5.2	%)		0.0	%		0.0	%
Adjusted EBITDA		25.2	%		25.4	%		25.4	%

¹  Prior guidance provided February 11, 2016. Current guidance reflects guidance provided April 26, 2016, as updated for the anticipated impact of the Ellipse Technologies and Mega Surgical acquisitions, the convertible notes issuance (and convertible notes repurchases), as well as expected changes in currency

²  Included in leasehold related charges are accelerated depreciation as a result of early leasehold terminations, which thereby were excluded from the depreciation line

³  Acquisition related items include expenses associated with M&A related activity and as incurred

⁴  Purchase accounting related items include items which are GAAP related fair value adjustments which are recognized at the time of acquistion and amortized over a reasonable period of time.

⁵  Included in CEO related transition costs are $1.2m of stock based compensation charges, which thereby were excluded from the non-cash stock based compensation line

Reconciliation of Non-GAAP Information

Management uses certain non-GAAP financial measures such as non-GAAP earnings per share, non-GAAP net income, non-GAAP operating expenses and non-GAAP operating profit margin, which exclude amortization of intangible assets, purchase accounting related charges, leasehold related charges, integration related expenses associated with acquired businesses, one-time restructuring and acquisition related items, CEO transition related costs, certain litigation charges, non-cash interest expense and/or losses on convertible notes, and the impact from taxes related to these items, including those taxes that would have occurred in lieu of these items. Management also uses certain non-GAAP measures which are intended to exclude the impact of foreign exchange currency fluctuations. The measure constant currency is the use of an exchange rate that eliminates fluctuations when calculating financial performance numbers.

The Company also uses measures such as free cash flow, which represents cash flow from operations less cash used in the acquisition and disposition of capital. Additionally, the Company uses an adjusted EBITDA measure which represents earnings before interest, taxes, depreciation and amortization and excludes the impact of stock-based compensation, purchase accounting related changes, leasehold related charges, integration related expenses associated with acquired businesses, CEO transition related costs, certain litigation liabilities, acquisition related items and other significant one-time items. Management calculates the non-GAAP financial measures provided in this earnings release excluding these costs and uses these

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non-GAAP financial measures to enable it to further and more consistently analyze the period-to-period financial performance of its core business operations. Management believes that providing investors with these non-GAAP measures gives them additional information to enable them to assess, in the same way management assesses, the Company’s current and future continuing operations. These non-GAAP measures are not in accordance with, or an alternative for, GAAP, and may be different from non-GAAP measures used by other companies. Set forth below are reconciliations of the non-GAAP financial measures to the comparable GAAP financial measure.

Reconciliation of First Quarter 2016 Results

GAAP Net Loss per Share to Non-GAAP Earnings per Share

(in thousands, except per share data)	Adjustments			Earnings Per Share
GAAP net loss	$	(8,886	)	$	(0.18	)
GAAP impact of change from basic to diluted share count					0.01
GAAP net loss, adjusted to diluted Non-GAAP share count				$	(0.17	)
Loss on extinguishment of debt		17,444
Non-cash interest expense on convertible notes		4,310
Amortization of intangible assets		7,549
One-time and acquisition related items 1		5,257
Non-cash purchase accounting adjustments on acquisitions 2		4,916
Leasehold related charges		50
Tax effect of adjustments 3		(14,595	)
Adjustments to GAAP net loss		24,931			0.49
Non-GAAP earnings	$	16,045		$	0.31
GAAP weighted shares outstanding - basic and diluted					49,617
Non-GAAP weighted shares outstanding - diluted 4					50,974

¹  Acquisition related items include expenses associated with M&A related activity which are expensed as incurred.

²  Represents costs associated with non-cash purchase accounting adjustments, such as acquired inventory fair market value adjustments, which are amortized over the period in which underlying products are sold

³  The impact on results from taxes include tax effecting the adjustments above at the statutory rate as well as taking into account discrete items and including those discrete items in the annual effective tax rate calculation. The Company also includes those adjustments that would have benefited the tax rate in lieu of the above adjustments as part of the Company’s tax filings. The impact of the changes to the tax rate results in an annual estimated rate of 40.6% on a non-GAAP basis. The result of these adjustments is a change in the quarterly effective tax rate from 29.8% to 40.6%

⁴  As non-GAAP results are net income, the non-GAAP weighted shares outstanding includes dilution related to the Company’s options, employee stock purchase plan and restricted stock units in the amount of 1,357k shares that are considered non-dilutive for the net loss under US GAAP

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Reconciliation of First Quarter 2016 Results

GAAP net loss to Adjusted EBITDA

	Three months ended
(in thousands, except per share data)	March 31, 2016
GAAP net loss	$	(8,886	)
Interest Expense/(Income), net 1		25,588
Provision for income taxes		(3,962	)
Depreciation and Amortization		20,894
EBITDA	$	33,634
Non-cash stock based compensation		4,492
Leasehold realted charges		50
One-time and acquisition related items		5,257
Non-cash purchase accounting related charges 2		4,916
Adjusted EBITDA	$	48,349
As a percentage of revenue		22.5	%

¹  Included in Interest (income) / expense, net is loss on extinguishment of debt for $17.4 million.

²  Represents costs associated with non-cash purchase accounting adjustments, such as acquired inventory fair market value adjustments, which are amortized over the period in which underlying products are sold

Investor Conference Call

NuVasive will hold a conference call today at 4:30 p.m. ET / 1:30 p.m. PT to discuss the results of its financial performance for the first quarter 2016. The dial-in numbers are 1-877-407-9039 for domestic callers and 1-201-689-8470 for international callers. A live webcast of the conference call will be available online from the Investor Relations page of the Company’s website at www.nuvasive.com. After the live webcast, the call will remain available on NuVasive’s website through May 26, 2016. In addition, a telephone replay of the call will be available until May 3, 2016. The replay dial-in numbers are 1-877-870-5176 for domestic callers and 1-858-384-5517 for international callers. Please use pin number: 13634226.

About NuVasive

NuVasive is a global medical device company focused on transforming spine surgery by empowering surgeons with technology to approach procedures in the least disruptive way possible and restore the vitality of life for those that suffer from debilitating spinal conditions. Through its minimally invasive, procedurally-integrated solutions, the Company is expanding the boundaries of modern healthcare with technologies and surgeon training designed to provide reproducible and clinically-proven surgical outcomes that are redefining the success factors of spine surgery like never before. Addressing a variety of pathologies up and down the spine, from complex spinal deformity to degenerative spinal conditions, NuVasive’s highly differentiated solutions include access instruments, implantable hardware and increasingly expert software systems like its game-changing iGA™ surgical planning and reconciliation technology that centers on achieving the global alignment of the spine. NuVasive believes its integrated approach and expertise can fundamentally evolve spine care by delivering improved patient experiences, and better economics for healthcare systems. With $811 million in revenues as of the end of 2015, NuVasive has an approximate 1,600 person workforce in more than 40 countries around the world. For more information on the Company, please visit www.nuvasive.com.

NuVasive cautions you that statements included in this news release or made on the investor conference call referenced herein that are not a description of historical facts are forward-looking statements that involve risks, uncertainties, assumptions and other factors which, if they do not materialize or prove correct,

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could cause NuVasive’s results to differ materially from historical results or those expressed or implied by such forward-looking statements. In addition, this news release contains selected financial results from the first quarter 2016, as well as projections for 2016 financial guidance and longer-term financial performance goals. The numbers for the first quarter 2016 are prior to the completion of review procedures by the Company’s external auditors and are subject to adjustment. In addition, the Company’s projections for 2016 financial guidance and longer-term financial performance goals represent current estimates, including initial estimates of the potential benefits, synergies and cost savings associated with acquisitions, which are subject to the risk of being inaccurate because of the preliminary nature of the forecasts, the risk of further adjustment, or unanticipated difficulty in selling products or generating expected profitability. The potential risks and uncertainties that could cause actual growth and results to differ materially include, but are not limited to: the risk that NuVasive’s revenue or earnings projections may turn out to be inaccurate because of the preliminary nature of the forecasts; the risk of further adjustment to financial results or future financial expectations; unanticipated difficulty in selling products, generating revenue or producing expected profitability; the risk that acquisitions will not be integrated successfully or that the benefits and synergies from the acquisition may not be fully realized or may take longer to realize than expected; and those other risks and uncertainties more fully described in the Company’s news releases and periodic filings with the Securities and Exchange Commission. NuVasive’s public filings with the Securities and Exchange Commission are available at www.sec.gov. The forward-looking statements contained herein are based on the current expectations and assumptions of NuVasive and not on historical facts. NuVasive assumes no obligation to update any forward-looking statement to reflect events or circumstances arising after the date on which it was made.

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NuVasive, Inc.

Consolidated Statements of Operations

(in thousands, except per share data)

	Three Months Ended March 31,
(unaudited)	2016			2015
Revenue	$	215,104		$	192,383
Cost of goods sold (excluding below amortization of intangible assets)		54,226			45,664
Gross profit		160,878			146,719
Operating expenses:
Sales, marketing and administrative		130,195			116,096
Research and development		10,629			9,264
Amortization of intangible assets		7,871			2,996
Litigation liability (gain)		—			(42,575	)
Business transition costs		(50	)		5,373
Total operating expenses		148,645			91,154
Interest and other expense, net:
Interest income		328			419
Interest expense		(8,472	)		(7,126	)
Loss on repurchase of convertible notes		(17,444	)		—
Other income, net		50			424
Total interest and other expense, net		(25,538	)		(6,283	)
(Loss) income before income taxes		(13,305	)		49,282
Income tax benefit (expense)		3,962			(17,885	)
Consolidated net (loss) income	$	(9,343	)	$	31,397
Add back net loss attributable to non-controlling interests	$	(457	)	$	(163	)
Net (loss) income attributable to NuVasive, Inc.	$	(8,886	)	$	31,560

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NuVasive, Inc.

Consolidated Balance Sheets

(in thousands, except par values and share amounts)

	March 31, 2016			December 31, 2015
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	270,105		$	192,339
Short-term marketable securities		42,495			165,423
Accounts receivable, net of allowances of $5,856 and $5,320, respectively		126,088			127,595
Inventory, net		200,711			168,140
Prepaid income taxes		44,921			40,540
Prepaid expenses and other current assets		7,844			8,790
Total current assets		692,164			702,827
Property and equipment, net		152,988			141,441
Long-term marketable securities		18,381			112,332
Intangible assets, net		266,089			85,076
Goodwill		404,307			154,281
Deferred tax assets		8,176			67,051
Restricted cash and investments		7,316			5,615
Other assets		19,698			17,404
Total assets	$	1,569,119		$	1,286,027
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable and accrued liabilities	$	77,357		$	60,986
Accrued payroll and related expenses		30,276			37,641
Contingent liabilities		19,497			—
Income tax liabilities		930			990
Total current liabilities		128,060			99,617
Senior convertible notes		669,398			372,920
Deferred and income tax liabilities, non-current		11,496			8,602
Non-current litigation liabilities		88,310			88,261
Other long-term liabilities		20,170			14,425
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.001 par value; 5,000,000 shares authorized, none outstanding		—			—
Common stock, $0.001 par value; 120,000,000 shares authorized at March 31, 2016 and December 31, 2015, 53,418,900 and 52,616,471 issued and outstanding at March 31, 2016 and December 31, 2015, respectively		53			53
Additional paid-in capital		961,206			989,387
Accumulated other comprehensive loss		(9,079	)		(12,112	)
Accumulated deficit		(129,533	)		(120,647	)
Treasury stock at cost; 3,647,690 shares and 3,316,794 shares at March 31, 2016 and December 31, 2015, respectively		(177,814	)		(161,788	)
Total NuVasive, Inc. stockholders’ equity		644,833			694,893
Non-controlling interests		6,852			7,309
Total equity	$	651,685		$	702,202
Total liabilities and equity	$	1,569,119		$	1,286,027

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NuVasive, Inc.

Consolidated Statements of Cash Flows

(in thousands)

	Three Months Ended March 31,
(unaudited)	2016			2015
Operating activities:
Consolidated net (loss) income	$	(9,343	)	$	31,397
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation and amortization		21,224			16,051
Loss on repurchases of convertible notes		17,444			—
Amortization of non-cash interest		5,112			4,331
Stock-based compensation		4,492			7,611
Reserves on current assets		4,162			633
Other non-cash adjustments		3,491			6,172
Deferred income taxes		1,794			11,015
Changes in operating assets and liabilities, net of effects from acquisitions:
Accounts receivable		6,939			5,931
Inventory		(9,449	)		(11,367	)
Prepaid expenses and other current assets		1,303			444
Accounts payable and accrued liabilities		10,040			17,428
Accrued royalties		(19	)		(47,459	)
Accrued payroll and related expenses		(9,219	)		(10,163	)
Litigation liability		—			7,730
Income taxes		9,421			(13,731	)
Net cash provided by operating activities		57,392			26,023
Investing activities:
Acquisition of Ellipse Technologies, net of cash acquired		(380,674	)		—
Other acquisitions and investments		(8,079	)		(1,357	)
Purchases of intangible assets		(1,027	)		(27,389	)
Purchases of property and equipment		(18,279	)		(30,694	)
Purchases of marketable securities		(36,096	)		(71,129	)
Proceeds from sales of marketable securities		253,435			105,794
Purchases of restricted investments		—			(32,616	)
Net cash used in investing activities		(190,720	)		(57,391	)
Financing activities:
Incremental tax benefits related to stock-based compensation awards		—			8,092
Proceeds from the issuance of common stock		444			1,403
Payment of contingent consideration		—			(514	)
Purchase of treasury stock		(12,599	)		(30,944	)
Proceeds from issuance of convertible debt, net of issuance costs		634,140			—
Proceeds from sale of warrants		44,850			—
Purchase of convertible note hedge		(111,150	)		—
Repurchases of convertible notes		(343,835	)		—
Proceeds from revolving line of credit		50,000			—
Repayments on revolving line of credit		(50,000	)		—
Other financing activities		(1,442	)		(45	)
Net cash provided by (used in) financing activities		210,408			(22,008	)
Effect of exchange rate changes on cash		686			(517	)
Increase (decrease) in cash and cash equivalents		77,766			(53,893	)
Cash and cash equivalents at beginning of period		192,339			142,387
Cash and cash equivalents at end of period	$	270,105		$	88,494

11

Investor Contact:

Stacy Roughan

NuVasive, Inc.

1-858-909-1812

sroughan@nuvasive.com

Media Contact:

Michael Farrington

NuVasive, Inc.

1-858-909-1940

mfarrington@nuvasive.com

12

EX-99.2

NuVasive, Inc.

First Quarter 2016 Results

April 26, 2016

Exhibit 99.2

©2016 NuVasive®, Inc.

©2016 NuVasive®, Inc.

Forward-Looking Statements

NuVasive

cautions

you

that

statements

included

in

this

presentation

that

are

not

a

description

of

historical

facts

are

forward-looking

statements

that

involve

risks,

uncertainties,

assumptions

and

other

factors

which,

if

they

do

not

materialize

or

prove

correct,

could

cause

NuVasive’s

results

to

differ

materially

from

historical

results

or

those

expressed

or

implied

by

such

forward-looking

statements.

In

addition,

this

presentation

contains

selected

financial

results

from

the

first

quarter

2016,

as

well

as

projections

for

2016

financial

guidance

and

longer-term

financial

performance

goals.

The

numbers

for

the

first

quarter

2016

are

prior

to

the

completion

of

review

procedures

by

the

Company’s

external

auditors

and

are

subject

to

adjustment.

In

addition,

the

Company’s

projections

for

2016

financial

guidance

and

longer-term

financial

performance

goals

represent

current

estimates,

including

initial

estimates

of

the

potential

benefits,

synergies

and

cost

savings

associated

with

acquisitions,

which

are

subject

to

the

risk

of

being

inaccurate

because

of

the

preliminary

nature

of

the

forecasts,

the

risk

of

further

adjustment,

or

unanticipated

difficulty

in

selling

products

or

generating

expected

profitability.

The

potential

risks

and

uncertainties

that

could

cause

actual

growth

and

results

to

differ

materially

include,

but

are

not

limited

to:

the

risk

that

NuVasive’s

revenue

or

earnings

projections

may

turn

out

to

be

inaccurate

because

of

the

preliminary

nature

of

the

forecasts;

the

risk

of

further

adjustment

to

financial

results

or

future

financial

expectations;

unanticipated

difficulty

in

selling

products,

generating

revenue

or

producing

expected

profitability;

the

risk

that

acquisitions

will

not

be

integrated

successfully

or

that

the

benefits

and

synergies

from

the

acquisition

may

not

be

fully

realized

or

may

take

longer

to

realize

than

expected;

and

those

other

risks

and

uncertainties

more

fully

described

in

the

Company’s

news

releases

and

periodic

filings

with

the

Securities

and

Exchange

Commission.

NuVasive’s

public

filings

with

the

Securities

and

Exchange

Commission

are

available

at

www.sec.gov.

The

forward-

looking

statements

contained

herein

are

based

on

the

current

expectations

and

assumptions

of

NuVasive

and

not

on

historical

facts.

NuVasive

assumes

no

obligation

to

update

any

forward-looking

statement

to

reflect

events

or

circumstances

arising

after

the

date

on

which

it

was

made.

2

©2016 NuVasive®, Inc.

©2016 NuVasive®, Inc.

Non-GAAP Financial Measures

Management

uses

certain

non-GAAP

financial

measures

such

as

non-GAAP

earnings

per

share,

non-GAAP

net

income,

non-GAAP

operating

expenses

and

non-GAAP

operating

profit

margin,

which

exclude

amortization

of

intangible

assets,

purchase

accounting

related

charges,

leasehold

related

charges,

integration

related

expenses

associated

with

acquired

businesses,

one-time

restructuring

and

acquisition

related

items,

CEO

transition

related

costs,

certain

litigation

charges,

non-cash

interest

expense

and/or

losses

on

convertible

notes,

and

the

impact

from

taxes

related

to

these

items,

including

those

taxes

that

would

have

occurred

in

lieu

of

these

items.

Management

also

uses

certain

non-GAAP

measures

which

are

intended

to

exclude

the

impact

of

foreign

exchange

currency

fluctuations.

The

measure

constant

currency

is

the

use

of

an

exchange

rate

that

eliminates

fluctuations

when

calculating

financial

performance

numbers.

The

Company

also

uses

measures

such

as

free

cash

flow,

which

represents

cash

flow

from

operations

less

cash

used

in

the

acquisition

and

disposition

of

capital.

Additionally,

the

Company

uses

an

adjusted

EBITDA

measure

which

represents

earnings

before

interest,

taxes,

depreciation

and

amortization

and

excludes

the

impact

of

stock-based

compensation,

purchase

accounting

related

changes,

leasehold

related

charges,

integration

related

expenses

associated

with

acquired

businesses,

CEO

transition

related

costs,

certain

litigation

liabilities,

acquisition

related

items

and

other

significant

one-time

items.

Management

calculates

the

non-GAAP

financial

measures

provided

in

this

earnings

release

excluding

these

costs

and

uses

these

non-GAAP

financial

measures

to

enable

it

to

further

and

more

consistently

analyze

the

period-to-period

financial

performance

of

its

core

business

operations.

Management

believes

that

providing

investors

with

these

non-GAAP

measures

gives

them

additional

information

to

enable

them

to

assess,

in

the

same

way

management

assesses,

the

Company’s

current

and

future

continuing

operations.

These

non-GAAP

measures

are

not

in

accordance

with,

or

an

alternative

for,

GAAP,

and

may

be

different

from

non-GAAP

measures

used

by

other

companies.

For

reconciliations

of

non-GAAP

financial

measures

to

the

comparable

GAAP

financial

measure,

please

visit

the

Investor

Relations

section

of

the

Company’s

corporate

website

at

www.nuvasive.com.

3

©2016 NuVasive®, Inc.

©2016 NuVasive®, Inc.

Double-digit revenue growth and profitability expansion

First Quarter 2016 Performance Highlights

4

Innovation

Growth

Profitability

•

Completed acquisition of Ellipse

Technologies and now focused

on integration

•

Expanded reach into early-onset

scoliosis market with acquisition

of MAGEC® technology

•

Readying launch of several new

innovations at AANS, including

AttraX® Putty Biotextured™

Bone Graft, Reline® Modular

System and Reline Power, MAS®

TLIF 2 and Monolith™

Corpectomy

System

•

Dedicating 5.6% of revenue, or

more than $50 million, to R&D

investments in 2016

•

Returned to double-digit

revenue growth up 12.3%,

constant currency, to $215.1

million

•

Strong Reline posterior fixation

system performance and

ongoing adoption of iGA™ and

NUVA planning technology

•

Performance up in all procedural

categories, lead by posterior

lumbar with strong growth in

cervical and anterior lumbar

•

Localized improvement plans in

Western Europe showing

improved results

•

Acquired Brazilian distributor

•

Delivered 150 basis points of

profitability expansion

•

Non-GAAP operating profit

margin of 14.1%

•

Non-GAAP EPS of $0.31

•

Capturing well-identified

operating efficiencies,

particularly around gross margin

and SM&A leverage

•

Continued focus on optimizing

scale and globalization efforts

•

On track with build out of West

Carrollton, OH manufacturing

facility to support ~100% self-

manufacturing goal

©2016 NuVasive®, Inc.

©2016 NuVasive®, Inc.

Operational excellence

delivering significant

margin expansion

Driving organic growth

with numerous inorganic

opportunities available

Industry disruptor

adding value and

addressing unmet needs

NuVasive’s

Formula

for

Success

Fueling 2016 strategic agenda with proven approach to win

5

Profitability

©2015 NuVasive®, Inc.

©2016 NuVasive®, Inc.

©2016 NuVasive®, Inc.

First Quarter 2016 Revenue Highlights

Strong revenue performance in key growth areas

*Constant currency basis

6

U.S. SPINAL HARDWARE

Includes All Implants, Fixation, MAGEC®

& PRECICE®

Up 15.0% in 1Q16

Key Performance Factors:

Fifth Consecutive Quarter of

Increasing Growth

Driven by ReLine, Increased

Adoption of iGA, Strong MAGEC and

PRECICE Sales

U.S. SURGICAL SUPPORT

Key Performance Factors:

Driven By Increased

Case Volumes

INTERNATIONAL

Up 20.7%

*

in 1Q16

Includes Puerto Rico

Key Performance Factors:

Japan, Italy & ANZ Remain

Strong Performers

Localized XLIF/MIS Focus Driving

Resurgence in Germany & U.K.

Includes Biologics, IOM Services

& Disposables

Up 3.7% in 1Q16

©2016 NuVasive®, Inc.

©2016 NuVasive®, Inc.

7

Driving Improved Financial Profile

Improve Adjusted EBITDA, reduce tax rate and lower depreciation

Driving to ~41% in 2016

Mid to High 30% in 2017

Mid to Low 30% Beyond

Reducing Non-GAAP

Effective Tax Rate*

Reducing CapEx

Burn from

~8% to ~6% of Revenue* Through

Better Set Configuration and

Utilization in Near Term

Improvement Opportunities Such

as 3-D Printing Longer Term

Lower Depreciation

*NuVasive financial performance guidance as of April 26, 2016

*

Increased Focus on Driving Improved

Adjusted EBITDA Through Disciplined

Spending and Improved Efficiencies

$144

$167

$204

~$236

$0

$50

$100

$150

$200

$250

2013

2014

2015

2016E

(In Millions)

Adjusted EBITDA

©2016 NuVasive®, Inc.

©2016 NuVasive®, Inc.

NuVasive Specialized Orthopedics™ (NSO)

Ellipse Technologies Integrates Into Newly Created NUVA Division

8

1Q16

Actuals

1Q16 YoY

Growth

NSO Revenues

•

As Reported –

February 12 to March 31, 2016

$5.8M

N/A

•

Pro

Forma –

January 1 to March 31, 2016

$11.7M

39.3%

NUVA

Core Revenues

•

U.S.

$182.7M

8.9%

•

International

$26.7M

8.5%, or 12.5% excluding currency

•

Total

$209.3M

8.8%, or 9.3% excluding currency

Combined 1Q16 Pro Forma Revenue Grew 10%, or 10.6% Constant Currency –

Outperforming Expectations to Drive High Single-Digit Growth with the Addition of NSO

©2016 NuVasive®, Inc.

©2016 NuVasive®, Inc.

©2016 NuVasive®, Inc.

Non-GAAP Measures

1Q16

Actuals

1Q16 YoY

Performance Factors

Gross Margin

77.1%

80

bps driven

by asset efficiencies,

lower royalties, med device tax repeal

Sales, Marketing

& Admin.

58.0%

80

bps driven by asset efficiencies,

including better instrument utilization

& back-office efficiencies

Research & Development

4.9%

10 bps driven by investments

in NSO

& iGA

platforms, procedural offerings

Operating Profit Margin

14.1%

150 bps driven by COGS and SM&A

leverage

EPS

$0.31

$0.01

Adjusted

EBITDA Margin

22.5%

50 bps due to NSO acquisition

Operating leverage story continues to play out

First Quarter 2016 P&L Performance

9

©2015 NuVasive®, Inc.

©2016 NuVasive®, Inc.

©2016 NuVasive®, Inc.

Provides certainty, extends maturities and addresses potential dilution

Completed 2021 Convertible Notes Issuance

•

Raised $650 million, including a $100 million over-allotment option,

generating net proceeds of ~$634 million

•

Notes have a coupon rate of 2.25%, in addition to callable feature that

provides opportunity to control future dilutive impacts to shareholders

•

Used proceeds to put in place bond hedge at net cost of ~$66 million, taking

effective conversion price from $59.82 to $80.00

•

Used ~$344 million to repurchase ~70% of existing 2017 convertible notes

and intend to make additional repurchases over time

•

Paid down the original $50 million draw on revolver

•

Expect 2016 non-GAAP Other Income & Expense of ~$19 million for the year

•

Expect 2016 non-GAAP weighted average shares outstanding of ~51.3 million

10

©2016 NuVasive®, Inc.

©2016 NuVasive®, Inc.

11

FY16 Guidance

Performance

Drivers

Revenues

•

As reported

•

Full year

pro forma

~$928.0M, ~14%

YoY

growth^

$935M, ~9% growth

~$53M NSO contribution; ~$5M currency impact

$~875 core business revenue; ~$60M NSO revenue

•

U.S. Spinal Hardware

•

U.S. Surgical

Support

•

International

~14% YoY

growth

~3% YoY

growth

~40% YoY

growth

Strong expected lumbar, cervical and NSO product performance

Slower growth expectations for biologics and services

~37% constant currency impact; comprised

of core NuVasive

growth

of ~20%,

NSO product growth of ~17%

Non-GAAP

Gross Margin

~77.4%

~140 bps increase due to 2-year suspension of med device tax,

favorable mix from lumbar and cervical portfolios

Non-GAAP Sales, Marketing

&

Admin.

~56.0%

~40 bps improvement driven

by core NuVasive asset and

sales force

efficiencies,

support function management, International scale

Non-GAAP Research &

Development

~5.6%

~130 bps increase in

organic and inorganic investment in innovation

Non-GAAP Operating Profit

Margin

~15.8%

~140 bps

of core NuVasive margin improvement,

primarily offset by

NSO investment

Non-GAAP Earnings Per Share

~$1.48

~13% YoY

growth

Adjusted

EBITDA Margin

~25.4%

~20 bps

increase

Non-GAAP Effective Tax Rate

~41.0%

~100

bps improvement from 42% in 2015

Non-GAAP

diluted WASO

~51.3M shares

Reduced from ~52.5M shares due to convertible note

issuance and

note

repurchases

Reflects Impact of Acquisitions, Convertible Note Issuance and Note

Repurchases, and Expected Currency Rates

Full Year 2016 Financial Performance Guidance*

*NuVasive financial performance guidance as of April 26, 2016; ^Constant currency as reported

©2016 NuVasive®, Inc.

©2016 NuVasive®, Inc.

Relentless focus on driving shareholder value

Why Invest in NuVasive

12

Industry-leading innovation and

integrated procedural solutions

enables share-taking and

premium pricing

Drive surgeon conversion,

increase service line

partnerships and expand

services integration

Double International revenue

contribution in coming years

Competitively positioned in large and growing global spine market with

favorable transformative dynamics playing to NuVasive strengths

Grow revenues at

multiples of

market in high

single-digit

range*

Achieve ~25%

long-term non-

GAAP operating

profit margin and

~32% adjusted

EBITDA goals*

Optimize tax

structure to help

drive EPS growth

2x the rate of

revenue growth*

Disciplined capital

deployment for

strategic M&A

and partnerships

Set to generate

significant

increases in free

cash flow

*NuVasive financial performance guidance as of April 26, 2016