Were the changes in September mainly due to faster demand growth or shifts in market share?

  • Hearing aid sales through the US Department of Veterans Affairs (VA) channel rose 4% year over year in September, compared with 3% in August; neither figure is adjusted for differences in trading days. Bernstein says such monthly fluctuations are not unusual, so its research focuses on brand share and new product performance.
  • In September, Demant’s unit share rose 0.5 percentage points month over month and Sonova’s increased by about 0.1 percentage points; Starkey’s fell 0.4 percentage points, while GN and WSA each lost 0.1 percentage points. Demand grew moderately, while orders continued to shift toward Demant and Sonova.

Why does Demant’s Zeal deserve attention beyond its initial sales gains?

  • Demant’s overall share of VA unit sales rose to 24.4% in September, above 23.9% in August and 19.7% in April. Share gains continued through September after Zeal entered the channel in May; Bernstein says share often falls back after a new product launch, making sustained growth a positive signal for Zeal’s competitiveness.
  • In the combined rechargeable and multi-processor in-the-ear hearing aid category, Zeal’s share rose from about 24% in July to 27% in August and 28% in September. Its average selling price when it entered the VA channel was 695 dollars, 42% higher than Demant’s rechargeable RIC products, suggesting the new product has the potential both to gain volume and improve the sales mix.
  • The shift is also squeezing a former leader: since Sonova’s Virto R and Demant’s Zeal entered the channel, Starkey, which once dominated the rechargeable in-the-ear category, has seen its overall VA unit share decline by a cumulative approximately 9 percentage points.

How can Sonova raise its average selling price after retaining its lead?

  • Sonova’s share of the combined in-the-ear category above rose from 42% in August to 43% in September, remaining above Demant’s approximately 28% and Starkey’s approximately 23%. However, its overall VA share was about 51%, below 54.1% in March; the slight recovery in September followed a decline and subsequent stabilization in share after Zeal entered the channel.
  • A more direct revenue lever is the Sphere product mix: its VA selling price is about 10% above standard Infinio, so a higher share can lift the average selling price. But Sphere accounted for about 51% of Sonova’s rechargeable RIC unit sales in September, down slightly from about 52% in August; that month’s mix shift ran counter to this upside thesis.
  • Bernstein expects the product mix to shift entirely toward Sphere after EON Sphere enters the channel in November. Historical performance also shows that technological advantages must adapt to the channel: early Sphere share gains were limited by receiver durability issues, which have since been resolved.

How strong an industry signal can the VA provide, and what is the next milestone?

  • The VA accounted for 15% of US hearing aid unit sales in 2025 and provides monthly breakdowns of market share. Patients are typically younger, do not personally pay for the devices and are more sensitive to technological features, so Bernstein views the channel as a leading indicator of preferences for new products.
  • Channel performance still differs from the private market: although GN has regained share in the private market, it remains under pressure in the VA. Bernstein estimates the VA average selling price at about 480 dollars, below the 600–1100 dollars in the US private wholesale market; lower sales and marketing costs partly offset the impact of lower prices on operating margins.
  • The key milestone is the November data due in December, which Bernstein sees as an early window for comparing the competitiveness of the latest round of RIC products. The firm maintains an Outperform rating on Sonova with a target price of 285 Swiss francs, and a Market Perform rating on Demant with a target price of 322 Danish kroner.