Shares of TransMedics Group, Inc. surged 5.18% during intraday trading on Friday, following the company's disclosure of a significant one-time tax benefit that dramatically improved its fourth-quarter financial results.
The medical technology company issued additional information regarding the impact of releasing a $103.3 million U.S. tax valuation allowance in the fourth quarter of 2025. This action resulted in a net income tax benefit of $83.8 million for the quarter.
Consequently, TransMedics reported fourth-quarter net income of $105.4 million, with diluted earnings per share of $2.62. The company noted that its full-year 2025 effective tax rate was (77.0)%, but excluding the impact of the valuation allowance release, the rate would have been 19.1%. TransMedics expects future quarterly income tax provisions to align more closely with standard U.S. statutory corporate income tax rates.