Ivan Tornos
Director, President & Chief Executive Officer at Zimmer Biomet
Thank you, Zach. Thank you, everyone, for joining today's call. Good morning.
I would like to start the way that I usually do, by taking a quick moment to show my sincere gratitude to the north of 18,000 Zimmer Biomet team members across the world, who each and every day go above and beyond in delivering on our mission, alleviating pain and improving the quality of life for people around the world. That's what you and I get to do each and every day, and you're doing an unreal job in bringing this mission into action. Thank you for your commitment to Zimmer Biomet, thank you for your tireless work, and thank you for the very strong performance so far in this year 2024.
We are now past the midpoint in the year and we're growing 5% after having delivered strong performances in 2023, 2022, and 2021. So the trend is real, the performance is there, and I'm deeply proud of the work that you're doing daily. As I've said countless times, the Zimmer Biomet workforce and our culture here is truly one of our key competitive advantages. In today's call, I'm going to give some opening remarks and then Suky will cover financials. And then, as always, we will leave ample time to answer your questions.
The agenda for today, first, I'll cover some perspective on the quarter. Secondly, I'll discuss the drivers of our performance and why we are even more confident than ever in our updated full year guidance for 2024 and why, already looking into 2025 and beyond, we're also very confident that we'll continue to deliver on the long-range plan commitments that we outlined at the end of May at our first ever Zimmer Biomet Investor Day. Recall, those commitments were driving revenue growth at least at mid-single digit growth rates, driving EPS at 1.5 revenue growth, and driving free cash flow growth at least 100 basis points above our EPS commitments. The third thing in the agenda, we'll close with our strategic priorities, those being people and culture, operational excellence, and innovation and diversification.
Starting with our Q2 results, we continue to be very encouraged by our global performance. In the second quarter of this year 2024, we grew 5.6% on a constant currency basis. And with that, we have now closed the first half of 2024, growing 5%. Worth noting that this 5% is versus very tough comps in the first half of 2023. The second quarter of 2024 now marks the 10th consecutive quarter in which Zimmer Biomet has grown mid-single digit or above. So again, a trend in the making that is real, and we're very confident that this performance will continue, if not will accelerate as we continue to move our business forward. Against the backdrop, in the quarter, we did see some weakness early in the first half of the quarter in the US. It's worth noting that May and June here in the US were better than April. And in July, the US Recon business actually delivered mid-single digit growth.
So choppiness through the first half of the quarter and then an improvement through the second half, which has continued with very strong performance through the month of July. Our OUS international business, outside the US business, has delivered above expectations. We saw a strong demand in the key markets across both Recon and the S.E.T. categories. So overall, very diversified, solid performance coming out of these markets. I love the fact that in Q2, in our second quarter, we continued to deliver excellent performance in our other category. This category is primarily focused on enabling technologies, primarily ROSA. We saw a strong demand for ROSA, growing double digit in that business and we also saw strong demand in enabling technologies and navigation systems.
As we have been saying for quite some time, we want to be more than just a leading reconstructive knees and hips company in key geographies, where we have a really high market share, as an example, the US or key countries of Europe and Asia Pacific. One example of this diversification journey has been S.E.T. We've been committing to growing S.E.T. at least mid-single digit and Q2 of 2024 is now the third quarter in a row in where we are growing mid-single digit or above, a trend that we expect to continue towards the end of 2024 and moving into 2025 and 2026. So nice growth in other, nice growth in international, and nice growth in S.E.T. One area that I'll tell you we've made significant strides is within our hips portfolio. We did lose some market share in hips in the US and OUS markets over the last three years to five years.
And as I said over and over, this was due to lacking three key product items, direct anterior stems -- what we call triple taper stems, elegant navigation, and surgical impactors. As we sit here today, we have remediated those gaps. We have 510(k) approval for Z1 or triple taper stem. We are regaining market share already with HAMMR, or surgical impactor. And today, we have the most comprehensive navigation in hip arthroplasty. Not only do we have ROSA Hip, we also have the only 510(K) FDA-cleared augmented/mixed reality hip navigation platform via a partnership with our colleagues at Hip Insights.
And now, we have also signed and announced an agreement to acquire OrthoGrid that is going to give us a leading position in navigation using artificial intelligence devices. So we have the most comprehensive suite of solutions in navigation, in direct anterior stems, and in surgical impactors, not to mention having the best core implant technology with products like G7 and Avenir Complete. So the expectation is to grow again above market when it comes to hips and regain some of the market share that we lost over the last three years or five years.
Moving from hips, we have developed and we are today the first and only robotic-assisted shoulder replacement platform in the world. The feedback on the cases we've done with ROSA Shoulder continues to be very compelling, and as we enter late Q3 and early Q4, we expect to see an acceleration of those cases. And in 2025, we expect ROSA Shoulder to be a very meaningful growth driver for Zimmer Biomet. We recently announced the partnership with THINK Surgical. This is going to provide our surgeon customers optionality across the robotic landscape. We have conducted extensive training with one voice on customer and the feedback on this partnership with THINK remains superb.
With this partnership, Zimmer Biomet is the only orthopedic company in the world that will offer both a handheld CT scan-based system in the TMINI, exclusive for Zimmer Biomet platform, as well as a simplified, CT scan-less robotic system in our current form factor of ROSA for total knee arthroplasty. We're excited about the optionality and we're also excited about the fact that we continue to innovate at a very fast pace when it comes to ROSA and we're expecting to launch at least three new ROSA modalities in the next three quarters to eight quarters. From an earnings standpoint, we generated $2.01 of adjusted earnings per share in the quarter or a growth of 10%. This is in line with our long-range plan targets I outlined at our Investor Day in May.
Inside of the strong performance through the first half of the year, the team continues to execute on the three strategic priorities that I keep outlining in each and every earnings call and at every Zimmer Biomet meeting around the world. The three priorities of people and culture, foundational to everything that we do; operational excellence; and innovation and diversification. As I said in my opening, people and culture continues to be a key competitive advantage for Zimmer Biomet. I'm proud to share that Zimmer Biomet was recently named one of America's Best Midsize Companies to work for by TIME magazine. This reflects the strength in team member satisfaction and engagement, our revenue growth profile, and the turnaround of the organization now behind us.
On the second imperative, operational excellence, we continue to expect to grow constant currency revenue at least at mid-single digit level, with adjusted earnings per share growing at least 1.5 times revenue, and free cash flow growing at least 100 basis points faster than earnings. It's a commitment that we're making not just for 2024, but also for the long-range plan 2025, 2026, and beyond. This is a mindset that continues to proliferate throughout the organization. We pay people on delivering towards such commitments. We have trained people to deliver on those commitments and the trend, as I've repeated a few times in my opening remarks, is in the making.
In the past, when it comes to innovation and diversification, it's been very much portfolio-centric, moving from lower-growth markets to higher-growth markets, point in case, the super performance in S.E.T. But today, we're also thinking diversification from a geographic mix standpoint. We want to continue to invest in key markets outside of the US where we see an opportunity to deliver sustainable revenue and profit growth. We're encouraged by the sound performance that we've seen in our OUS business and we expect to continue to accelerate growth in these markets without compromising our margin performance.
In conclusion, we are very proud of how far we have come as an organization in terms of the financial progress, the innovation progress, and the commercial execution. Our second quarter results are another proof point that we make commitments and deliver on those commitments, and we fully expect that the trend is going to continue for the balance of the year and beyond. We're confident in our guidance for the year and we love the fact that we're impacting the lives of millions of people, and I'm deeply inspired every day in knowing that my teammates and I are living the Zimmer Biomet mission of alleviating pain and improving the quality of life for people around the world.
With that, I'll turn the call over to Suky. Thank you.
