LENSAR (LNSR) 9 May 242024 Q1 Earnings call transcript

Good morning, and thank you for your participation. [Operator Instructions] As a reminder, this conference call will be recorded. I would now like to turn the call over to Lee Roth of Burns McClellan. Mr. Roth, please go ahead.

Kevin. Thanks, and Call. LENSAR everyone, Financial Quarter to Conference Results welcome morning, First the XXXX Good we a quarter today, company's XXXX. Earlier issued financial of an results the overview for the ended XX, press March release providing copy section our Relations A the www.lensar.com. of this available website release on of Investor at is

Joining recent Chief operational business Officer, me progress. today will who Curtis, the Nick call and review on is Executive the company's

Officer for of the his first LENSAR, provide Q&A Following Chief comments, turn of highlights Staab, session. an over operator we company's before Financial financial back to the Tom quarter overview call for will the the the

as expressed statements actual materially These cause from Before will as anticipated results our and/or like may contain unknown to future subject to information I'd and achievements. call. we be including achievements performance statements, performance you information known implied statements are uncertainties, regarding future begin, different forward-looking that risks well call forward-looking which and and results, to on or today's conference results, unaudited any during remind or this financial and performance our or

You should undue not forward-looking on place statements. these any reliance

Exchange documents For with risk factors, our including the the of company's our additional refer be to Securities a information, please accessed can detailed discussion Commission, and on which filed website.

statements call. time-sensitive In to the obligation reflect no of of the update addition, revise broadcast, live date after only to accurate XXXX. circumstances or contains this undertakes forward-looking LENSAR date any May call this as information events of X, the this otherwise or live

Nick to Curtis. LENSAR's now over Executive it's Officer, to pleasure my call the that, With turn Nick? Chief

ALLY increased to quarter great conference months us first to productivity revenue quarter XXXX. ALLY of systems the everyone. quarter. having start in XXXX, performance call. and systems we adoption continued realized the XX growth to on and This end XX of We've good as X our of approximately you a first Thank Thank of compared a procedure morning X for placed XX% of market. you, growth the was year, installed the with XX% Through base to of had fueled the by ALLY joining increasing XXXX first the and backlog U.S. the the Lee,

as been on emphasize analogy equipment system a placements with To been To this the success describe characterized revenue quarter. and of has number the of point our measured has to borrowing the timing. a game inches. recurring the business our model point, Footfall by criticality capital in of

clear the record systems. it mind, that signed the pleased a into than sales QX. additional contracts an few moved days whereby momentum first start quarter positive was Given the ALLY With to with we cycle, a is that the as achieved the have never QX, accelerated for to long XX difference can in we we in report more have very I'm

expect this proud We're later is not procedure build will installations placements accomplished and growth do by in in the what do systems we've completed to we compound date, we all begin these procedures the expect growth revenue believe these be to year quarter and While of placed third recurring in to quarterly quarter, the beyond. I the and extremely this strong second be start a and revenue. of and

and forward compelling other to single line U.S. Heretofore, marketed only U.S. approvals. ALLY and to proposition market, achieve we growth as a selling ALLY Despite top the gained been activity based value of especially Europe. into has has look strong steadily LENSAR in await significant sales regulatory in we system market able on share pipeline have offering utilization additional and the been markets, increased, ALLY.

are their Europe, the preparing home U.S., to commercial are Kong awaiting our ALLY Hong and not available South Although widely Korea, in regulatory quickly distributors authorizations. after clearance and receipt marketing outside of ALLY make surgeons availability is in countries, available Taiwan and

additional before the we nearly had annual in end ASCRS surgeon XXX recent our Boston, clearances highest history, the meeting ALLY We XXXX. regulatory engagement demos. At of completing in the company's expect level of

to ALLY laser was session, presentations in and continuing X is the with increased the surgeons, presented total session and as LENSAR presentations X were of astigmatism papers outcomes presentation clinical the of at surgery. we In best efficiency-related technology the as X including benefits voted in Many the from toward highlighted counteract innovation the femtosecond refractive cataract managing the leader session. XX the grow. in We continue of overall be of to which recognized conference laser enthusiasm associated

is As much past, delivering enables on the higher enhancing we've ALLY. aspects surgeons, and their staff outcomes efficiencies, and delivery the delivering We're By for these of the objectives, the in experience described on in refractive key that patients better technology LENSAR LENSAR improving in next staff cataract focused X is in on our and profitability procedures. practices is satisfaction. same of reimbursement coming reevaluation pressure, significant the empowering surgeons given CMS to costs, or overhead while either patient XXXX. reduction and cataract surgery the the under and significantly EBITDA in decrease increase At revenue standard cataract focused opportunity

in data physician. to ALLY time to revenue annual additional the annual staff approximate maximize paying of superb and an resulting throughput is demonstrating up million surgery patients. in as we important and the time more patients, productivity than and also significant continually a of demand out ASC portion studies while and published for increase for pocket, expect well outcomes an increasingly better service savings Recently, and from patients the The opportunity happy ability becoming increase in producing outcomes. With $X.X to they ever, revenue to patient physicians, several motion as to $XXX,XXX potential

in surgical number patient's surgeons a are the of financial increasing integrate their their the benefit in ALLY happier hour the the choosing have armamentarium. the patients both that surgical and provides facilities. practices to cataract time and to [ and for realized improved generates by spent potential to to for accompany addition, outcomes proposition The almost value surgery into ALLY In win-win time the the ASC patient ] savings total

increased first For System competitive that procedure average femtosecond data practices surgery X prior for surgeon cataract femtosecond months market charges more example, scope during to revenue using at our than Xx. just versus cataract around device laser-assisted older ALLY rates patient, X $X.X approximately for months of their their the conversion Based an in that contributed using surgery conversions X laser-assisted in months. practice on one forecast ALLY additional the this practice of reported comparing we million

higher and practice. the the Better experience yielding revenue improving outcomes more for patients and satisfied efficiencies, are

utilization X.X% gain and ALLY an release, share the additional morning's As laser-assisted led to quarter. this of we Market in disclosed and procedure press Scope, U.S. surgery LENSAR femtosecond according in the first market to adoption cataract

launch picking We the up of have a U.S. X.X% share share market in quarter share of the total gained ALLY. each since procedure ALLY, since launching

quarter market QX our highest Our single ever increase. gain marked XXXX in share

million capturing objective procedures rates, larger clearly femto the laser-assisted the Ally market percentage cataract and the overall While cataract in a piece successful longer-range our market laser-assisted femtosecond to performed much we from more larger also procedures grow XX of surgery our femtosecond naive increasing a been and cataract competitors by surgical have taking conversion of annual share representing by performed. practices converting

influential and the large expect contributing and the most associated end-of-life stigmatism cataract specifically to systems factors, is legacy the market, time. designed a to yet committed the these inefficiencies total As The competitive be continues in we outcomes in of several the small over account are with compelling older cataract market we was but limiting ALLY replace laser femtosecond undeniably surgery in technology are surgery percentage company, inherent with see to a is factors. procedures. to factors phenomena to mind. continue There technology data laser-assisted for grow of these lack managing continue surgeon-centric the LENSAR

and practices other of speak surgical demonstrated is increased next-generation our of discussions technologies. laser-assisted or to they've many I confidence practices as with As had to femtosecond have a ALLY compared you concerns that approval with issues addressing previously utilization are clearly and nod using deep with procedures continue indeed to first-generation I cataract we first-generation technologies. previous LENSAR receiving has today, surgeons, mitigate system with in LENSAR their

further is the creating a introducing cataract increasing anticipated market as ever-evolving abandoned a successfully in We share had surgeons growth femtasecond that lost surgery to total and in share believe as cataract technology. surgery back the bringing and gains in parallel its positioned cataract users conditions drive in will market who loyal system this or accelerate optimally growth. also procedures are surgery competitive perfect laser-assisted market interest for surgeons with validation. is broader naive laser-assisted well We're first-generation in due LENSAR percentage of limitations previously femto ALLY Our storm converting market as to femtosecond

Tom to to Tom? turn Now highlights call the our let over quarter. for me the cover financial

Thank you, Nick.

make reflecting our strong financial certain results quarter release first Revenue $X.X brief this the but million press XX% in issued of like additional in in first earlier Our XXXX to provide in a the million remarks morning was items first some clarity. to detail on XXXX of quarter $XX.X compared on growth. to included are I'd increase quarter XXXX,

United strong regions. ALLY XX% were This growth we do our are we until of was States our greater foundation in in we volume you procedure saw are the operating of a marketing worldwide EU system growth placements remind I Systems the and ALLY X solid to lines. want than and contributors increase clearance. generated all revenue off increases largest of revenue in but that ALLY procedure only sales granted all to

Gross compared representing receive quarter in receive to regulatory gross Europe. since quarter been a trajectory inherently XXXX. million margin uncertain, will in increase numbers has the margin first year. we is expect growth placement gross Though launch $X.X ALLY of million our $X.X we to authorization continue significantly realized we impressive, the believe marketing the margin any XX% was for rapidly and of XX% While process once this to and approval we

strong this Our gross margin quarter. was

to a expect our future decrease ALLY of quarters. mix margin higher product sales in gross percentage we concentration However, in

our margin expect For decrease million continue quarter administrative to R&D operating attributable expenses partially percentage million the the for XXXX. expansion gross costs, approximately was higher Total of first lower in expenses in the with XXXX to expenses The team. commercial offset $X.X of associated first and were operating of primarily of $X.X XX%. the year, we compared to a quarter by

to per recent ALLY and improvement accelerate commercial of significant expand $X.X share, to successes. quarter the per our quarter XXXX. continue million share or team $X.XX $X.XX market reflecting will the a for $X.X placement million gains share Net over first was in and a our loss a loss loss We loss

quarter dollars Our net first loss of and in XX% decreased per from share both XXXX. the

breakeven continue into and year expect to this late trend this expect We XXXX. and quarters see to operating

December at XX, XXXX, of As of $XX.X cash XX, March we cash as XXXX. and million equivalents to compared had million $XX.X

was used quarter Cash in the first million. $X.X

As the other lower a business a reminder, quarter seasonal cash the are represents quarters and first higher a year. revenue use of and usually we of than a level of

to like to look answering I'd operator, your turn the call over the forward and to Now questions. we

Lake We will . Frank take from Instructions] [Operator first Takkinen Street Capital Markets. question our today with

year. ] in the [indiscernible] related XX orders to can strategy? any start naive to orders the competitive these QX? anything you jump you about these a solid wins? color you just out can seems significant any wins? Maybe the XX Just already. on around like, start Congrats change give they to QX Great. new up. commentary us obviously, already the [ additional Are I in on with wanted called touch Are

the appreciate I question. a Frank, Yes.

XX other by these X, new represents A And a suites, of for of represent a and in So the these are question XX them all systems business good those in couple which -- competitive mix. surgery because LENSAR. a the systems. way, replacing is are in-office XX

So previous these we done people are not business have XX with the systems. that on

And I said, office with competitive will Several penetration well. replacing we're in much a XX will competitive the we had be those will had be getting not So be suites. XXth going those previously one And that as actually, devices. like into of some device into either. replacing of surgery regions

different to see we opportunities really covered. hadn't starting where in heretofore So areas

number, big revenue. new a competitive Not business for it's us all only it recurring on the systems, but is

about really now. right excited we where we're So are

Got of transitioning it. And maybe utilization. That's over to helpful. then kind

systems. could that a gone the competitive scale Your to see are through than new the we process from how these standpoint? maybe to kick typically from quite more sites, placements talk XXXX start systems revenue in being used with bit and when placements has the really a up new recurring But

Yes.

whether whatever So on depending they're between providing days the Femto again, And many the current another account staff account how and depending going before to they're actually would procedures. or and technology starts good how and surgeons. with it the are providing on purchasing physicians question because is take be really naive. familiar typically, the the system XX XX using Typically,

If have to days and longer you or that's people can you surgeon you and the before have surgeons it's takes X get XX trained, if more start fewer producing surgeons, or procedures. folks get it they facility, the between let's X trained, a say, XX difference up

generally And on device, a the a was using results usually terms in started see of after the quickly lot that depending example, we competitive doctor if patient. people lot But to the had the XX-day of able ramp period, then about confidence with talked they one they've very convert seeing patients. because to come of the the I been more They outcomes back start like growth, up. see we

utilization in presenting we manage a we not a we efficient do than comes see And unique devices. in the that any lot increased from astigmatism. so fashion, the the much confidence a the staff and And gives competitive of of way more lot in that the but that more a only it way

people all you cataract XX% may that visually see basis. small they prevalent. in of as so they're XX% more more. and all aware stigmatism significant to therefore, great as only XX% patients, out global results. that, get And treated that there percentage on that surgeries that be confidence they're and being is represents a And And a . getting is presenting to are yet It's XX% of quickly

last the us what it. this That's of U.S. just standpoint, potential manufacturing about you clearance, systems maybe have European a half From capacity manufacturing second And inflecting one. obviously helpful. talk Got right capacity year, now? to kind

an single to. now, been to things a we have not I shift a win, capacity. running start if, say get we it's always Again, it's We've right that happening. would we're and So anticipating start

any our We've inventory. ordering backorders. don't parts. some capacity. bought been We're issues we've enough And I so now, anticipate And got right forecasting builds. we've or

parts some are we parts of there assemble, all We delays se. the per between machine with manufacture receiving So this. associated don't

state-of-the-art of got So build We've We build some together systems. our but to our we're systems. We've so. prepared for is here. systems got got parts. manufacturing do what's we've suppliers There and we can capability staff terms with putting lag, can coming the in

BTIG. Our next question Zimmerman Ryan comes with from

guys me okay? hear you Can

Yes.

of of to put want comments installed some metrics on how more Nick, system you little for the can around that. view that's the quickly years that how coming kind over in Congrats the older a the if worth guys Any turn made you over of I and opportunity? noting I'm state or bit the in of just kind mean, I ALLY. that you out in base laser about there progress. to talk you quantitative are those curious opportunities presenting bring about kind market. could you color think

question. Nice Yes.

And including say this current LENSAR that in installed. just installed are of systems X,XXX globally States that systems date. systems to all there's X,XXX XXX is which over United to about systems, there's So are about and globally close the systems,

systems the that XXXX are So the field X,XXX, into X,XXX companies companies latter the the And then time into field of you've Those competitive marketplace XXXX. in devices. first devices got other part the competing came came the frame. in in

old. systems XX years are getting those So XX,

as what in few the you in the Some field you They been LLS very on will. they what, even few that, that less quite has got capability technology XX-year-old LENSAR systems moving ALLY. of field they field the XX- upgrading lasers several And that have or now is and over the long, they've consider their like weren't that years have. the adding long. been been now came the a when them than systems have and have were first-generation if fact and in develop They're takes technology upgrades, essentially with that software-based same the base into we years to into our the

the by and we're There much doctor the years like feel great them that's isn't their lot So doing doctors use practices to position of with is into generates revenue and that getting XX -- we in XX, like changing economic rooms win. faster for and that paradigm operating that much old, in a XX, device here. is and and smaller more kind it's be a procedures the fully a efficient. not it's Again, a highly much an sterile this allows if, a

the units curious, No, are opportunity certainly, before the U.S. are And that's And good perspective. quarter, Yes. missed I'm in I kind great of XX this. color, that might in coming those all the the second have Nick. you. a

correct. That's

Yes.

right. Okay. All

that is could year. not with anything come later [indiscernible] this accounting this potentially for So in

Okay. I Flax share in you as think mean then the you're market. And environment, there. procedure That's about very the taking

put of the headwinds. think the Korean growth of as You up about XX% comp the the fairly of to negative we because market remainder of How just do a kind you out look year? on health the procedure

never X/X we're at market of looking we is got forbid example, XX% astigmatism. us cylinder patients diopter LASIK, of for PRK the really significant XX% patient the at Smile market doctors because visually or of simply of view procedure, leave a of wouldn't opportunity remaining would the a about this for of in as allow X/X diopter to have the or to be So optimistic the happy. part procedure to patient even diopter And X/X procedures, just cylinder with cylinder that

patient managing and they great in stemitism. cases, the better choosing is [indiscernible] much So our utilization can the vision they're because the of for -- we're in traced the matter to doctor really patient be the management, provide a it what to can opportunity higher most higher utilization lens if no presents

potential that expansion. view as we So

why consideration of we doctors took Vente We it and ALLY identify they at reasons don't we do designed into are with at stopped laser the evaluate doing why or reasons do whether it heretofore it. of should all doing these they it or not other XX% The that not. started had when chose all point is thing to or the that to trying still looked this

utility those doctors to value features build not femtosecond only try it. it But doing that we at into time, so would currently lasers And same it. of we're that those Ally and were doctors and found offering that not to the appeal in

but to with And or so you can the market we penetrating there stopped done for feel that you're surgeons and today out opportunity start had devices, like not it. providing only replace not ultimately, we older we these that's doing had that it

then And if I it. kind Got putting think that not you're with we're guidance of any kind where comfortable about top commentary expectation? line just on talked sustain know XX% and the past. to we've your ability to in growth the about of plus still out, still but

that expectation. with comfortable We're

We for further floor have this turn questions back closing I over Curtis to any no will at time. remarks. Nick the now .

everybody continue stay for of appreciate joining forward thank in progress. looking I remainder make tuned. to to to you interest . we your LENSAR. and So exciting further call XXXX. continued an you look Please updating We're as our forward today, really We

Thank you, everyone. We This concludes today's your participation. appreciate teleconference.

at may any You disconnect time.