Shares of Zimmer Biomet Holdings (ZBH) dropped sharply by 9% after the orthopedic products manufacturer warned of the negative impact of transitioning to a new enterprise resource planning (ERP) system on its 2024 financial results.

During the Wells Fargo 2024 Healthcare Conference, Zimmer Biomet’s management stated that the company is transitioning from an outdated ERP system to a new platform from SAP, but the switch has proven difficult. The company expects this to cause a 1% decline in revenue this year, with the issues expected to ease by the end of the fourth quarter.

Analysts predict that the ERP implementation challenges will pressure sales, particularly in the sports medicine and trauma segments. Stifel analysts forecast a 210-basis-point drop in third-quarter sales, while Evercore ISI experts estimate that earnings per share will decrease by 15 cents.

Previously, Zimmer Biomet shares had been rising following the publication of second-quarter results and the announcement of a deal to acquire OrthoGrid Systems. However, Thursday’s losses led to a 14% year-to-date decline in stock prices.