Contact:		Investors:
Kevin C. O’Boyle		Patrick F. Williams
EVP & Chief Financial Officer		Vice President, Finance & Investor Relations
NuVasive, Inc.		NuVasive, Inc.
858-909-1998		858-638-5511
investorrelations@nuvasive.com		investorrelations@nuvasive.com
		Media:
		Jason Rando
		The Ruth Group
		646-536-7025
		jrando@theruthgroup.com

•		Total revenue of $94.9 million; up 41.8% from third quarter 2008 and up 7.3% from second quarter 2009
•		Gross margin of 80.6% compared to 81.8% for third quarter 2008 and to 81.1% for second quarter 2009
•		GAAP earnings of $5.1 million or $0.13 per share; Non-GAAP earnings of $11.0 million or $0.28 per share

SAN DIEGO, October 20, 2009 — NuVasive, Inc. (Nasdaq: NUVA), a medical device company focused on developing products for minimally disruptive surgical treatments for the spine, announced today financial results for the quarter ended September 30, 2009.

NuVasive reported third quarter revenue of $94.9 million, a 41.8% increase over the $66.9 million for the third quarter 2008 and a 7.3% increase over the $88.5 million for the second quarter 2009.

Gross profit for the third quarter 2009 was $76.5 million and gross margin was 80.6%, compared to a gross profit of $54.7 million and a gross margin of 81.8% for the third quarter 2008. For the second quarter 2009, gross profit was $71.8 million and gross margin was 81.1%.

Total operating expenses for the third quarter 2009 were $70.4 million compared to $77.7 million in the third quarter 2008 and $67.3 million in the second quarter 2009. Operating expenses include $0.6 million of acquisition related costs, a $2.0 million reversal of a leasehold termination charge and $0.8 million related to intellectual property litigation.

On a GAAP basis, the Company reported net income of $5.1 million, or $0.13 per share, for the third quarter 2009.

On a Non-GAAP basis, the Company reported net income of $11.0 million, or $0.28 per share, for the third quarter 2009. The Non-GAAP earnings per share calculations for the third quarter exclude (i) stock-based compensation of $5.2 million; (ii) amortization of acquired intangible assets of $1.4 million; (iii) acquisition related costs of $0.6 million; (iv) intellectual property litigation costs of $0.8 million, and (v) the reversal of a leasehold termination charge of $2.0 million.

Cash, cash equivalents and short and long-term marketable securities were $200.2 million at September 30, 2009.

Alex Lukianov, Chairman and Chief Executive Officer, said, “NuVasive is pioneering the lateral approach with our proprietary XLIF^® procedure and MAS^® platform. We continue to take market share and expand our addressable market by broadening the application of our technology throughout the spine. We are the only company with the ability to laterally address a wide range of applications in the lumbar and thoracic spine, from single level procedures to complex multi level deformity corrections. We are pleased with our financial performance in the third quarter of 2009, and are confident in our strategy to become the #4 global spine company.”

Updated 2009 Financial Guidance

NuVasive is updating its full year 2009 financial guidance as follows:

•

$365 million to $367 million; up from previous guidance of $360 million to $365 million

•

Gross Margin of approximately 81%

•

GAAP: earnings per share of $0.11 to $0.14; up from previous guidance of $0.06 to $0.08

•

Earnings per share of $0.27 to $0.30 excluding adjustments per the enclosed table; up from previous guidance of $0.25 to $0.27

Reconciliation of Non-GAAP Information

Management uses certain Non-GAAP financial measures such as Non-GAAP earnings per share, which exclude intellectual property litigation expenses, the reversal of leasehold termination charges, acquisition related costs, stock-based compensation, and the amortization of acquired intangible assets. Management does not consider these costs in evaluating the continuing operations of the Company. Therefore, 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 analyze further, and more consistently, the period-to-period financial performance of its core business operations. Management believes that providing investors with these Non-GAAP measures gives them additional important 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.

(in thousands, except per share amounts)		$				Per Share
GAAP net income		$	5,064			$	0.13
IP litigation costs			780				0.02
Reversal of leasehold termination charge			(1,997	)			(0.05	)
Acquisition related costs			621				0.02
Earnings excluding other adjustments			4,468				0.11
Non-cash stock-based compensation			5,166				0.13
Amortization of acquired intangible assets			1,364				0.04
Non-GAAP earnings		$	10,998			$	0.28
Diluted weighted shares outstanding							39,216

(in thousands, except per share amounts)		$				Per Share
GAAP net income		$	3,527			$	0.09
IP litigation costs			3,408				0.09
Reversal of leasehold termination charge			(1,997	)			(0.05	)
Acquisition related costs			3,096				0.08
Earnings excluding other adjustments			8,034				0.21
Non-cash stock-based compensation			18,165				0.47
Amortization of acquired intangible assets			4,071				0.11
Non-GAAP earnings		$	30,270			$	0.79
Diluted weighted shares outstanding							38,384

		Range for Year Ending
		December 31, 2009
(in thousands, except per share amounts)		Low				High
GAAP net earnings per share		$	0.11			$	0.14
IP litigation costs			0.13				0.13
Reversal of leasehold termination charge			(0.05	)			(0.05	)
Acquisition related costs			0.08				0.08
Earnings per share excluding other adjustments			0.27				0.30
Non-cash stock-based compensation			0.64				0.64
Amortization of acquired intangible assets			0.13				0.13
Non-GAAP earnings per share		$	1.04			$	1.07
Diluted weighted shares outstanding			38,800				38,800

Conference Call

NuVasive will hold a conference call today at 5:30 p.m. ET / 2:30 p.m. PT to discuss the results. The dial-in numbers are 1-877-407-4018 for domestic callers and 1-201-689-8471 for international callers. A live webcast of the conference call will be available online from the investor relations page of the Company’s corporate website at www.nuvasive.com.

After the live webcast, the call will remain available on NuVasive’s website, www.nuvasive.com, through November 20, 2009. In addition, a telephonic replay of the call will be available until November 3, 2009. The replay dial-in numbers are 1-877-660-6853 for domestic callers and 1-201-612-7415 for international callers. Please use account number 3055 and conference ID number 331825.

About NuVasive

NuVasive is a medical device company focused on the design, development, and marketing of products for the surgical treatment of spine disorders. The Company’s product portfolio is focused primarily on the $4.6 billion U.S. spine implant market. Additionally, the Company has expanded into the $1.5 billion global biologics market, the $1.5 billion international market, and is developing products for the emerging motion preservation market.

NuVasive’s principal product offering is based on its Maximum Access Surgery, or MAS^® platform. The MAS platform combines four categories of products that collectively minimize soft tissue disruption during spine surgery with maximum visualization and safe, easy reproducibility for the surgeon: NeuroVision^®, a proprietary software-driven nerve avoidance system; MaXcess^®, a unique split-blade retractor system; a wide variety of specialized implants; and several biologic fusion enhancers. MAS significantly reduces surgery time and returns patients to activities of daily living much faster than conventional approaches. Having redefined spine surgery with the MAS platform’s lateral approach, known as eXtreme Lateral Interbody Fusion, or XLIF^®, NuVasive has built an entire spine franchise. With nearly 50 products today spanning lumbar, thoracic and cervical applications, the Company will continue to expand and evolve its offering predicated on its R&D focus and dedication to outstanding service levels supported by a culture of Absolute Responsiveness^®.

		Three Months Ended September 30,								Nine Months Ended September 30,
		2009				2008				2009				2008
Revenues		$	94,916			$	66,915			$	263,405			$	175,501
Cost of goods sold			18,417				12,195				49,901				30,845
Gross profit			76,499				54,720				213,504				144,656
Operating expenses:
Sales, marketing and administrative			59,761				54,557				176,391				135,975
Research and development			10,654				6,396				30,047				19,797
In-process research and development			—				16,700				—				20,876
Total operating expenses			70,415				77,653				206,438				176,648
Interest income (expense) and other, net			(1,648	)			(146	)			(4,850	)			764
Net loss attributable to noncontrolling interests			628				—				1,311				—
Total other income (expense)			(1,020	)			(146	)			(3,539	)			764
Net income (loss) attributable to NuVasive, Inc.		$	5,064			$	(23,079	)		$	3,527			$	(31,228	)
Net income (loss) per share attributable to NuVasive, Inc.:
Basic net income (loss) per share		$	0.13			$	(0.64	)		$	0.10			$	(0.88	)
Diluted net income (loss) per share		$	0.13			$	(0.64	)		$	0.09			$	(0.88	)
Weighted average shares — basic			37,733				35,931				37,008				35,674
Weighted average shares — diluted			39,216				35,931				38,384				35,674
Stock-based compensation is included in operating expenses in the following categories:
Sales, marketing and administrative		$	4,265			$	4,499			$	14,748			$	13,541
Research and development			901				922				3,417				2,178
		$	5,166			$	5,421			$	18,165			$	15,719

NuVasive, Inc.
Unaudited Condensed Consolidated Balance Sheets
(in thousands)

		September 30,				December 31,
		2009				2008
		(In thousands, except par value)
ASSETS
Current assets:
Cash and cash equivalents		$	134,276			$	132,318
Short-term marketable securities			55,915				45,738
Accounts receivable, net			51,245				51,622
Inventory			85,892				68,834
Prepaid expenses and other current assets			3,925				3,466
Total current assets			331,253				301,978
Property and equipment, net			77,543				73,686
Long-term marketable securities			10,032				45,305
Goodwill			102,264				2,332
Intangible assets, net			104,601				54,767
Other assets			7,337				9,338
Total assets		$	633,030			$	487,406
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued liabilities		$	23,183			$	26,633
Accrued payroll and related expenses			20,568				17,132
Acquisition related liabilities			15,414				—
Royalties payable			2,201				1,722
Total current liabilities			61,366				45,487
Senior convertible notes			230,000				230,000
Long-term acquisition related liabilities			30,318				12,111
Other long-term liabilities			29,099				12,177
Commitments and contingencies
Noncontrolling interests			13,689				—
Stockholders’ equity:
Common stock			38				36
Additional paid-in capital			460,290				383,293
Accumulated other comprehensive income (loss)			211				(190	)
Accumulated deficit			(191,981	)			(195,508	)
Total stockholders’ equity			268,558				187,631
Total liabilities and stockholders’ equity		$	633,030			$	487,406

		Nine Months Ended September 30,
		2009				2008
Operating activities:
Net income (loss)		$	3,527			$	(31,228	)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization			22,005				15,671
In-process research and development			—				20,876
Stock-based compensation			18,165				15,719
Leasehold abandonment			(1,997	)			4,486
Noncontrolling interest			(1,311	)			—
Allowance for doubtful accounts			1,175				410
Allowance for excess and obsolete inventory			2,470				(3	)
Other non-cash adjustments			2,248				1,019
Changes in operating assets and liabilities:
Accounts receivable			(329	)			(18,986	)
Inventory			(19,027	)			(22,136	)
Prepaid expenses and other current assets			788				(941	)
Accounts payable and accrued liabilities			2,410				3,898
Accrued payroll and related expenses			2,742				1,778
Net cash provided by (used in) operating activities			32,866				(9,437	)
Investing activities:
Cash paid for acquisitions			(24,055	)			(41,256	)
Investment in Progentix			(10,000	)			—
Acquisition related milestone payments			(10,000	)			—
Purchases of property and equipment			(21,250	)			(34,161	)
Purchases of short-term marketable securities			(46,678	)			(83,069	)
Sales of short-term marketable securities			56,365				29,842
Purchases of long-term marketable securities			(17,964	)			(51,390	)
Sales of long-term marketable securities			32,971				14,778
Other assets			—				544
Net cash used in investing activities			(40,611	)			(164,712	)
Financing activities:
Payments of long-term liabilities			—				(300	)
Issuance of convertible debt, net of costs			—				222,414
Purchase of convertible note hedges			—				(45,758	)
Sale of warrants			—				31,786
Issuance of common stock			9,618				8,480
Net cash provided by financing activities			9,618				216,622
Effect of exchange rate changes on cash			85				—
Increase in cash and cash equivalents			1,958				42,473
Cash and cash equivalents at beginning of year			132,318				61,915
Cash and cash equivalents at end of year		$	134,276			$	104,388