Demant Reports 2025 Revenue Growth but Lower Profits, Forcing Cost Cutting Program

Demant released its Annual Report 2025 alongside a company announcement detailing full-year results and a new profitability initiative that will include organizational staff reductions of about 700 positions—an action designed to reset costs after a year of softer industry-wide market growth and lower-than-normal profits. Demant is the parent company of Oticon, Bernafon, and many of the hearing industry's leading diagnostic and special equipment manufacturers.

In its 2025 financial results announcement, Denmark-based Demant reported 5% revenue growth (2% organic) for 2025, with EBIT before special items of DKK 3.960 billion (≈US$626 million) for a 17.2% operating margin.

Overall, Demant’s year-end financial report painted a ”good news-bad news” picture: organic sales met its twice-revised 2025 forecasts despite a challenging year for the industry (flat or slightly negative growth in U.S. hearing aid sales); however, profits (EBIT) decreased by about 7%. This has prompted a cost-saving program that includes job cuts. However, according to a company spokesperson at Oticon US with knowledge of the situation, the staff reductions will mainly affect administrative positions outside the United States and will not impact activities related to professional services.

Similar to almost all of the recent financial reports from global hearing aid manufacturers, Demant's 2025 year-end report cited “macroeconomic uncertainties” for the “reduced willingness to invest and [resulting] in delayed purchases. In turn, this led to lower-than-normal growth in the hearing healthcare market, especially in the US, and thus intense competition.”

This was echoed in my recent conversation with Demant CEO Søren Nielsen at the Oticon Zeal product launch, who said that even in Denmark, where about half the population gets hearing aids for free, the market is flat due to economic uncertainty. “You don't take the step [toward getting a hearing aid] if you're not comfortable about how the world is going to develop,” said Nielsen. “And we see that worldwide: uncertainty in all parts is causing people to hold back…so they’re just postponing purchases a little bit.”

Demant implements cost-saving plan including job cuts

Demant says it will pursue permanent, long-term cost savings through structural changes implemented over the next two years. The company outlined multiple levers: shifting work to more cost-effective locations, prioritizing activities, increasing efforts to lower production costs, and tightening procurement.

Those changes come with workforce reductions. The company said it currently expects the initiative to affect approximately 700 employees globally in 2026, including 150 in Denmark. The company expects the plan to deliver annual cost savings of around DKK 500 million (US$79 million), with full effect in 2028, and it anticipates achieving DKK 250 million (US$39 million) of savings already in 2026.

What Oticon is telling the U.S. market

A representative from Oticon told HearingTracker that the reductions will not significantly impact the United States and that hearing care providers will not experience cuts to important customer-facing roles such as field representatives, customer service, and related support positions.

Instead, the representative said the cuts are expected to mainly target administrative positions outside the U.S. as Demant streamlines functions and reallocates costs. Although the spokesperson did not mention it, Demant acquired KIND in 2025—one of Germany’s largest dispensing networks with about 650 locations—which may also have led to some overlap in administrative tasks.

Outlook: modest market growth, improving profitability

Looking ahead, Demant said it assumes global hearing aid market value growth of 2-4% in 2026, describing the forecast as conservative and “temporarily below” its medium- to long-term assumptions. Over the past decade-plus, the market has averaged about 4-6% growth.

For 2026, the company is guiding to 3-6% organic growth and EBIT before special items of DKK 4,100–4,500 million (US$648-711 million). Demant also said the profitability initiative is expected to contribute roughly DKK 250 million (US$39 million) to EBIT before special items in 2026, with most of the benefit skewing toward the second half of the year as actions ramp up.

The company further noted that the acquisition of KIND Group is expected to contribute about DKK 300 million (US$47 million) to EBIT before special items in 2026.

Oticon launched the unique Zeal NXT instant-fit in-ear hearing aid at EUHA in Germany in October and its debut two weeks ago in Phoenix was well received by attending hearing care professionals. Market analysts speculate that Oticon may launch a new flagship product line later this year behind the Zeal launch.