Alphatec (ATEC) 3 Aug 232023 Q2 Earnings call transcript

Good afternoon, everyone. And welcome to the webcast of ATEC’s Second Quarter Financial Results. We would like to remind everyone that participants on the call will make forward-looking statements. These statements are based on current expectations and are subject to uncertainties that could cause actual results to differ materially. These uncertainties are detailed in documents filed regularly with the SEC.

may adjusted company measures. you pro to call, or forma this hear refer the non-GAAP, During Reconciliations non-GAAP of measures to U.S. GAAP financial tables investors. which in why this the today’s view useful provide found all release, to is and quantify identify can press and of items management’s information included be in excluded supplemental

Todd to will have been lines call and prevent today’s Instructions]. All background ATEC’s Leading [Operator CEO, Pat on mute Koning. Chairman be Miles; any noise. and CFO, placed

Thank you.

over to call Miles. Now I the will Pat turn

so would review to leisure. call. statements Thanks quarter. you, and XXXX QX good everybody your very tell much welcome ask Danica this financial results a has I at the I got to to been you forward-looking

our our So fueled been growth has by spine focus.

$XXX was revenues, had revenue QX So a XX% EOS surgical EBITDA. look, million a that growth, $X.X if which would exclude positive growth and we ‘XX XX% adjusted in million you

XX% the to LTP launched really that and acquired talk growth in by drove bit are about. momentum, the achieve platform, lateral in navigation highlights ALIF X% enabled midline and million access contributor strongest to ALIF for robotics revenue, approach we SX. The and we'll XXXX was LX expanded We procedure, adjusted little growth, QX points. to extended a EBITDA growth, revenue basis we $XX per which growth XX% a EOS We which volume our proceduralise margin

kind changed, been really, authentic under commitments, distinction. able create Our to but auspices of continue clinical of ATEC not have focus, to recreation the spine we've since

surgery. surgeons vocation with distinction being commit your spine continues. And, And There's so spine nothing aligned clinical their the their to career, than commitment customer. of better

big. of them is focus being terms in with being So spine aligned

compel And surgeon we so to continue adoption.

subject aligned with very, same the the by to with with in is say sales being just the spine whole would regard very elevated and to force important. spine matter sophisticated becomes focus thing being I being And regard

is Spine it's with commoditized, something in not great predictability is spine the commoditized. of is oftentimes, misnomers one there's commoditized. So associated that great If it.

revision XX% a in five would years environment, I to say degenerative When And in you that's durable not to at surgery, would least to in see a three XX%, rate it's XX% one two predictable when to years, the same. a see I it's not environment. XX% that

And so the as variables. opportunity front and durability drive at mitigating reproducibility think we us, we in look we at, predictability, of by can

you and is And a spine you so do to and take when what about start you you and sophistication, elevate environment plan the measures variables, how end you create very early against diagnostically patient off view, do start you to and is of do you from you is informatics And view think and so procedural end. start our doing so you an to look And start so a and you variables challenging patient, on ecosystem mitigate preoperatively. to at in how control a an preoperatively.

can we what then variables things you everything do think mitigate you demonstrate and I necessary. do the interpretively it continue And to to is

we gosh, acquisition of enabled make navigation I robotic suggest continue would on can front. that think the the to platform progress

our front that SafeOp navigation as tool, continued well. get platform, the of neural we better continue With nerve evolution to on and health the

experience. trying to So surgery to op also op and not interrupt, only but regard the pre we're post with inform future

tough of And not is opportunity But ATEC to out in it. to significantly that surgery important indications outpacing a I look create in would better. for just that you, there, driver that you the tell candidly it's, about is think continues why all is data to lateral grow, the think it's lacks I greater not what a, the is field currently predictability to there's marketplace. certain that is I think talk And know, if you so And there's lateral. great clinical at a

hospital It's blood reviewed that's days just it XXX, be to so less publications. demonstrated as loss blood in better. less hospital peer terms stay, been it relates in And of loss, to back relates ambulating. to And and stay, as to normal activity

the I So say market the market. lateral growth is market, would it is coveted make no mistake, the most

doing people and the space Pimento, as And we the standard is ATEC the Luis best a created are by the great have original generation, that's, it's lateral date, lateral. we other was CMO. and great do wrong very pioneer, our part new thing out is, celebrating what and who anniversaries, first the where because companies in Dr. who it's And experience often the setting led is the that is

And better most nothing it. sophisticated having so most versed, in than there's the

decades did lateral first applying what to So generation. of address we really the in experience we're

So alignment. is of we're are doing what goals goals are saying stabilization and surgery what we're decompression the of the surgery and

PTP, So does how evolve we in did to essence, what initially? continue

platform, screws we're of is prone the so is most is place If complications, addressing to of that prone neural to is we're surgery, goals patient in they're Well, position it's a retraction a favorable stabilize, in ability it that put better efficiencies. the and much is fixation familiar in screws. is, SafeOp or the surgeon mitigates decompression, does PTP your position, posterior place a doing the again meaning the in the the more to great position surgeons, part a pedicle and pedicle a with position, part which

positioners, to something to applied is that positioning, learned patient we've the patient again, and control is PTP. ability Our

to over. And the You room don't have sagittal better. is the clearly alignment turn

truth lateral is serious monitoring. It's unless automated it's have neuro Our nice a view have. not to you surgery, participation a It's and not it foundational requirement. even view, in really is you're market about undeniable not our an

is complications directly designed is to ours So the surgery. lateral most risk, which documented address in common femoral nerve

which one things the we celebrate, neural unmatched the having of so of it expertise, we that is organizational the monitoring And really best have best. is

get to we We better. continue in this experience just have great and space

positioners, our feedback when and that you're Taking And in signal surgery. to a environment ever noisy they And small be participant monitoring. serious knocking the neuro capturing without not that -- going magic. we people is a a the off can't providing copy see we so -- actionable and meaning interpreting in very doing when then know retractor, lateral a patient copying

an And look you with going the have we're terms at covet and with to regard going about do we're part informatics we what's education. meaning lateral, competencies But to the being platform to a And to and people I do is tool. of in also it of what committed are. to an SafeOp ATEC consistency So, is, the predictability environment, taking you most think on. and think as have I driving what research, greater doing be there's think help this

and the PTP level both think PTP, And so that versus I publications for we're And the we the I generation TLIF, disease. education lateral the most standard committed field. been the within would say PTP first adjacent recent demonstrated verse, are some it's to research did. most of that

peer reviewed over XX XXXX. really there's in to We've currently. surgeons And host continue so XXX trained important we publications And events.

commitment surgery. how as as think lateral and conferences that again, as well. We can, Emory have counsel feedback a possibly learnings I we to we expediently as Which, is a or edit to Duke to apply the just illustrates demonstrates PTP well continues provide

I And more goals and PTP bottom us very aligned is bearer. that marketplace becoming think surgery, would line the the to tell really of really you meaningful I we quickly with the are expand in the so way. is And a enables lateral standard

would pathology just addressing based from to would posterior of that really upon of addressed PLIF to billion need making post so, been a $X $X billion And a the the participating and by some decompression. addition where segment do in you segment it TLIF a type historically

outset say it's pioneers requirements improve lateral at and to is ATEC only hurdles. to So I the better meet would challenging -- address that committed to the surgical

minute which We have is about designed solution ago. the talked part, SafeOp complications, the to which I a a avoid

I I best a whole tell you learnings we are other efforts. think, the applying the our thing is, obsoleting is of who last our here. reflection is, And cultural will

best they're our copies to forward. someone to play when learnings So because copy we're going going our this, last effort

who accustomed the expanding to market, conventional the transforming more Now, surgeons the are techniques.

is really, our so to advance market, is interest continue surgery. the which lateral coveted And most to

rewarded I that earns be think effect. we've and deem to a I trust, surgeon's think we been competence, lateral you halo create a the other it really way as when that

in when halo effect, say conventional we procedures. utilization that And more what product means it expands ATEC is

And becomes their valuable of that reflecting terms so very very, in momentum.

safety And we're or lateral of the looking navigation so in I drives how and experience and enabled mitigating previously variables in talked into SafeOp informatics at about integrate it the robotics surgery. how the to going information say translating, terms

going mid see term. things great And But such of the opportunity automated automated at elements want that EOS staring surgical really is rod. patient's ‘XX, models, reasonably in to And if option is to is the us planning first Xd the specific reports, near going automated surgical you're a start you're to expand is see to to its to you a influence planning. kind applying the alignment

And public image, immediate. as so ability alignment the assure the on biplanar mean as taking as when automated our view say measurements add what the we you immediately to are we is alignment, the is parameters, to and

informatics And to continue to apparent. element the add opportunity very, to very so planning this becomes

in thing up. and going assessment the to is ‘XX other The be follow

will of going to see And what in part you're a so that big XXXX. be

bone to alignment, material influence of stabilization the going And that underlying expect you're the subsequent be by to and decompression like to know want going or which a lot to quality, goals if year. said that you're we we So next stabilize to EOS is. going spine, what things is then

lessen valuable. quality continue in And bending believe in an room. interpretive to very the to number a bone measure opportunity there's so the We'll feel of alignment like refinements we make a efforts. that We configuration having required also element the is to assets rod integrate

at pathology, data, that had the give a foundation regard a SOC foundation foundational a with X, which then for is for way recently rich is building predictive have patients rich view IT to station great We're us really analytics ultimately on the data. technique data that surgeon our high that trust. we set. set, them like got a housed a data And that We're to future to requirement and like an provide enables have a the

have set. We edge data today that to currently accounts EOS our patients numerous have adding

time, all the will at spine. we data a set of I collection been the very forever for And have long so having rich manual. think data been And had this in most

we're you source. big make And in going data collection to is that a collecting the I we're and it's way automated elements, objective of an out more so automated for when data deal a assured what telling make

talked abled robotics. it is so bit little track. of we on a right the integration The And about navigation

investment to development expertise. And integration deep affirm have team. Our the ability is we're learnings us. continue and apparent thesis, very, our very They the about the to to thrilled advance

following year, Group procedural placement, hand clearance expect this navigation late in into free then And ‘XX. experience initial regulatory for in the continue to XXXX. in expect mid We clearance full we lateral will Invictus late to workflow integration

enthusiastic And remain that we what's totally bullish and profoundly about front. going so on

So ton I ton a a of from creating clinical distinction, of momentum excitement. and a think

to X.X of about compelling from adoption, products went surgeon per terms In at it's we X.X. procedure now

that the is demand for the we if surgery think coming that Also, I way about ever of you're educational fruition. experiences view high. convoyed demand, So to exceedingly wondering element is the

so And interest a doing. surgeons of we're there in tremendous in QX XXX had remains we amount and what

can't to front. As more be this I distribution. on it relates elevating excited

so talked we you spine interested we're funnel less quality they think well than we the about a point. celebrate about marketplace, the uncertainties the working that and opportunities that we of salespeople in ATEC. shareholder perspective, at this of think in We're to quantity improve a focus focus, the from positioned with and X% grow. And talk I spine

and speaks which again, in gaps strategically geographic don't to adoption. that have. surgeon others And to fill the the continue to candidly, think spine will will this We to large compel continue I focus,

to is, the going view join sales. you come is us percentage affirming very our of growth rate of XX% likelihood very, growing Another That's if at the very high. store you're same

addition the that love very fact places we not today people. the through We're is so the that thing And are very that the growing of growing have fast. just we

is share existing users of advance existing within team. aptitude territories. And further increased and to the geographies Earn so the our interest of clinical penetrate surgeon adjacent

And would love to so for you us. join

at us. to update in XX an and Angeles, NAS you consider October will this an for We Los so on join invitation innovation have

will I to over Todd. turn with So that, it

you Well. the Pat. today. appreciate call everyone. joining We good afternoon, us Thank you, on And

I'll with So revenue. begin

EOS over comprised the XX% revenue The to quarter in million year previous increasing X% total second revenue. million The and surgical of was growing of $XXX the of million and $XXX million $XXX quarter. revenue in compared $XX prior revenues

to year the compared our the in per Second utilizing continued franchise. volume XX%. benefit revenue million increased quarter, from quarter reflecting in XX% surgeon X% XX% of up expanded due $XXX with momentum over prior year, procedural the strong growth over number Lateral of the of solutions grew adoption year surgical revenue mixed surgeons our period. Procedural case to Average second

to The rate Lateral among is utilization applied as in surgeons continued increase in is per growing expandable and volume of and increase both increases robust PTP procedural of to number drove an procedure of is overall. those and surgeons broadening pathologies. in growth cages of case PTP biologics Strong to attach expanding, a our A performance the our also The complexity. contributed case. revenue set using reception posterior

distinction achieving where are areas the strongest areas growth. create the to invested the Importantly, we clinical have

remainder on by mix. up installations. the year-over-year The the XX% we've the revenue an improvements basis rate increased is the margin year. P&L points driven gross due to deliveries and of execution surgical both service to primarily million, compared success mix gross last the XX% improvement addressing the second year revenue an the solid quarter months. margin EOS was needs margin. $XX royalty improved backlog was XXX was came XX in up The with in gross increase through EOS compared and last of to EOS and of had over Working second non-GAAP prior benefit quarter contribution from

initiatives pricing as well implemented. As we've

on information April. of prior absolute quarter by dollar innovation in $X and million in solutions million non-GAAP R&D The machine including of based the increase continued was compared $XX was approximately the to with our in sales XX% organic XX% approximately million driven an year. advanced procedural and robotic navigation basis $X sales to associated a we Second and investment investment acquired platform of

second to in $XX was sales and year quarter, improved international half and the to leverage, variable XX% infrastructure and million We was that the related driven $XX sales approximately basis half SG&A prior delivered including XXX XX% of in an by creating the period. approximately of million of Non-GAAP points compared year-over-year, by improvement of points of other basis about XX selling investment expense presence.

business continues our we to the with leverage delivering the in grow to the we that are be contributors expectations. As line

the was and year Total $X.X and amounted the XX% second of operating expenses of non-GAAP quarter the basis of $XX quarter, sales prior XX% of million year in second XX% points leverage the approximately demonstrating XXX operating year-over-year. $XX period, compared sales approximately and X% Adjusted $X to in million to in million compared EBITDA and prior an million, to sales loss negative in of period. sales over

EBITDA quarter quarter basis over positive margin of are of pleased achieved points ahead plan. have represents This another And expansion. to XXXX adjusted this of we slightly

we've quarters Continued in long line performance growth confidence execution top profitability In delivering our disciplined this reinforces is achieving and results. the goals to. term committed

XX% in footprint instruments was the sales second growing quarter approximately which fuel $XX assets, product ended launches. totaled and and Turning of to cash to that $XXX the related sheet. our inventory in generating the We with distribution used new million Operating million, cash. balance investments

sales Given the set half the and into that required momentum this adjusted inventory improvements pulled that, first investments year. in forward first half half, benefited cash the offsetting strength second continue of the operating we of and in we to expect EBITDA the

million. That $XXX the was carrying value

midcap both revolving credit available the continue under to Braidwell borrowings undrawn have and and term loan. We facility

XX% million. the of XX% of full million and XXXX. revenue XX% to to approximately year XXXX EOS growth That million. full revenue to total surgical our growth revenue Turning $XXX approximately $XX for outlook includes $XXX expect to now to We year grow approximately

adjusted we year growth to of continue with our EBITDA the XXX EBITDA expect million, sales representing this $X conjunction to achieve progress full to line significant In raising points business, we top increased leverage are year. guidance, expansion. margin across drives As guidance basis adjusted

EBITDA, is through top to The line while specifically to growth. guide with flow we is increased framework upside reinvested adjusted of in a balance drive XX% shared to we've revenue about the line that anticipate

average surgical surgery by per The additional XXXX revenue updated our for and guidance. shaped few slides provide growth volume I'll procedural sharing and next expectations context guidance. revenue how start

continue to and rate, to enables both at increase of drives training surgeon’s surgeon robust complexity both and adoption work curve, surgeons a surgeons loyalty We up utilization. the which which utilization, train procedural builds

to that is ramp for to year teens The utilization year. growth compared volume the surgeon cohorts XXXX a now previously. each middle percent expected chart testament XXs and in our procedure consistent low these have volume the growth demonstrated dynamics, full to improvements we high Due expect

And our procedural implants more per LTP. The greater of revenue are Average average. procedures increasing to our which revenue our with higher towards complexity each surgeries rate than to more for enabling and mix as PTP products per shift feature expandable capture require overall biologics towards of of gradual surgery opportunity. us and like surgery that revenue all attach procedure addition also portfolio grows

We continue volume year. for growth increased digit dynamics you adoption, validate quantity been increased per has create both the to clinical compel a dynamics drive and percent surgeon powered customers our some, these that growth average is rate revenue volume per do full surgeon surgeon guidance you at single by related expectations. In high revenue utilization. surgical the expect These when procedural adoption. rate to That surgery to thesis distinction, of and

adjusted we time, P&L, XXXX-time of this horizon. committed the basis sales last expect growth have the begun XXX leverage that of our delivering of EBITDA with At last over leverage in leverage full Guidance enables XXXX described $X we are components improvement implies to range we year. for year operating long The been of demonstrate that points what to the relative consistent May. to continue. plan XXXX operating rest to dynamic the the points we to and respect that million With have to that for basis

about from to entailed points quarters improving commitments. several variable selling that gives XXX us continue about basis XXXX while variable XXXX rate confidence points contribution basis sales enabled SG&A growth from leverage. our infrastructure over of and to last infrastructure rate investing basis related the great about The That financial R&D, leverage the selling contribution growth point has in achieving and

surgery and results a and growth. closing our inflection that sector belief for Financial testament to driven quarter positive have deliver a quarter bearer revenue milestone spine is our EBITDA. mark are in to are advanced business, standard significant this surgery The continue good good ATEC. growth investments results become to will this the to Now leading adjusted continued also

We and momentum have opportunity great ahead. great

active We including IR October, an which to Pat Innovation mentioned have and I NAS connect with the calendar you our in few months, hope over with of many next in person. in Day, conjunction

With that, to the turn Pat. I'll over call back

Thanks so much, Todd.

you say a oftentimes, think Lateral. I built come. things clearly And growth to term from But to if done we at was influence say really would long we've XXXX, really and a what grown big trajectory. yet best a XX%. think foundation I for I look CAGR, is on like Revenue a have XXXX from we've assembled that our at

ahead. I yet are think days our best

drive think deformity. an reflect expanded through it franchise, If ourselves in distinguishing yet I about us growth informatics continuing of opportunity and you from EOS great to an to within to presence provides perspective, have us we've the value think the lateral

responding think of spine navigation robotics terms totally is enabled be will the enthusiastic think the rewarded, love I apparent those focus to opportunities. there. and the of uncertainty is the I We what piece the marketplace, about in opportunity so

to but states to forces places we're an the continue to narrow the we've where had going out access opportunity be very, international in we're and have now of seeing the we that have and hospital we expanded early zero see in perspective, we've From zero success participating. deep, in access, we're places business, sales were had and build continue We very to sales. phases that

a terms on shout launched realm. implants. to out from And is the both perspective interest have in really printed then We're our cervical team. continue force It's quite lastly, a we just the on of and clear. we NAS expandables posterior. And going Xd continued in sales working our professionalize will a a corpectomy regulatory be momentum There's from lateral lateral like at lot to within of

regulatory nine entire surpassed that's have We this years. submissions quarter, previous

obsolete And so absolutely a there commitment is. continuing to if there's you're to wondering ourselves, if

our our truth. we I bearer to I would it's think come, the tell best so powering our And say standard in be you I believe focus spine that objective the an yet ability when XXX% is that space. to is And

that, anyway, So with the operator. turn I'll over back it

please comes Instructions] first [Operator The from Stifel, question go with Matt Blackman ahead.

And everybody. it you lateral And Pat called I the curious in then you went changed might questions. my out because mix repeat taking And the that, add number by break could just you're that if XQ sort in of I've could would if last surgeon the the reception follow-up. terms that? last you months getting need be hoping fast roughest naive just and between who over afternoon, has surgeons. good for be I for it and was too Thank on one coming you if start, over provided. And to six I'm possible, all what XX a trained mentioned LTP got versus of And competitive what's to at that surgeon curious metric then even you months? top I on

the the because it on going been front, value, I'm the as of if answer haven't responsive The sets Todd very surgeon to a stuff the up. just LTP of volume it's demanded good. let -- it reality metric that's to numeric I'll is, level of relates level has we the right. garner a to had apparent. All The it reception screw very, there out

beauty. And so ALIF patient done And pictures texts a a work thing we've a the better of -- basis, and it's with than that on And with get lateral XX before. I a positioner. it's XX of the daily

surgery when volume follows. surgery so the the the good. is And good, And is

that And remain I of the that. bullish. exceedingly early in very phase I And we're say would so

to this the relative Matt, And trainings metric, we quarter. XQ XXX did about

quarters, four it's past is the I the over total. look you think If XXX

level of as upsurge great and strong are a indicator the know about So, surgeon and you adoption. surgeon in feel good for we at leading training trainings continue clip,

at it's your are I new with look naive, And we are of demographics balance who are technique, of XX% so, people adopt familiar kind and lateral technique the through, coming to with as and I'd being, the and looking the probably really words the LTP. say to PTP think, people in

maybe just Curious, maybe so levered follow sort a talk a fast underlying maybe up. you highly today, grower, market digit quite step obviously curious just bit low that today U.S.? but the in sort back think how more of you're the particularly in to single because some lateral quick major market? want market is then digits context, the underlying when of in single take a, think you growing give a Lateral the we what that about do market low about and Okay, think opportunity, is general, the growing than by spy us market But traditional being

the Yes, you was previous put that was Matt, it's nemesis certain one with a But, tough address were surgery a there the indications things of experience that the the couldn't that one to of on. for technique. number

And is is, very we part know so us. lateral it the the larger don't apparent is. hope will of But space tell if markets much as expanding to I into as a hope, fast applicability the great you I

all in and PLIF been stabilize type whole I like it I it's a don't would in so have position, resonates, decompression to And the direct and ability that's why prone like, patients. position, historically, TLIF prone the if but those a know

much the market to suggests we're technique for have of very pathologic opportunity. a broader applying is a And so perspective. that's much growth? from like, just Is I the the into Or market space where space us tough things into it a start fast is a And technique it one evolve time market? discerning it's it broader to

evolution. And like a of so shareholder, really hasn't uplift been there's such XX this of trek of in there. the for was But, a still opportunity last terms expandables enjoying outside out either years, there's much way, the not in TLIP from plethora a perspective we're very small market

going market? a most the the because we're about So demonstrated. Clearly, when Lateral you SafeOp coveted And of say, very is advantages from perspective, so what's that's been what's it hard. excited had why on

of anyway, little you answer kind about you bit longer than context know, of and we how And a it's it. just so think but wanted, a

I tapping and the market the overall the market. Matt, accrues to Lateral PTP. than implication existing market do kind TLIF incremental really it believe extent is the to growth think PLIF there we is growing That that to is of faster, And which due the

us, only expand for that quite utility but growth kind able and share pathological of pathologies growing broader applications, to us. of one So, also it's because to actually set of amount we're quickly, a taking the to existing we're because accrues

Understood, thank get I'll queue. you, back the in

Great, thank you.

Our next Please ahead. with go Josh question comes Jennings TD from Cowen.

case, on access think metric even about therefore and of revenue hoping case that case mean, LTP just and kind now Congrats that afternoon. you're early as per good a on more per case drive with watching more metric. bit system per follow I The increase with associated LTP the this, learn that and Was the that levels well. And Hi, is trends more lateral another strong more and should up just about gaining quarter. that, per TLIF to little traction, we with LTP as launch. I higher? the revenue guess revenue

would Yes, say LX-SX. the to Josh, I contract common most shortest LXX and is be be would going --

So least at two levels. it's going to be

favorable -- LX-SXfrom And the lateral been surgeons. a can't address me, very seeing nemesis from what has approach position. know, you lateral or lateral of acceptance you And a really as so is from excuse we're

access reception the we're super get that important. from is type And receiving so to of surgeons

tilt an LX-SX so with And to we're then the of to terms back in multilevel X, from seeing bringing surgeon our position patient done required position approach what patient access is patient surgery, orthogonal X and system above. and by an the early experience the with the

what done I than again, -- think we've before. so better better work And is it's the

learning And sure make ability apply important. so that and we're is X:X that hugely to including the

And so pictures, what as all there. is with orthogonality I look predictability drives associated at right the of the

good again, be that will this are all so one. And a indications

into higher translate mean point, revenue And Josh, complexity, more does levels ultimately per your to case. more which

you runway we that we're portfolio. that where very Great. And just off for Thanks think ATEC’s wanted is update the the there. still assumption But of lot and wanted so one that of are adopted through of growing accounts you that base, still -- And EOS ahead. is didn't cross-selling strongly a elements Thanks But an early there's opportunity haven't that. and our taking it's to -- process? have questions. sizable a to and get just the opportunity then are to with in on just for guys inherited implant with acquisition trying

to I in have for to all think biplanar outlined is surgery into when unit as as better move I significant interest. automated It's EOS the that low-dose of the ability growth meaningful take the standing, image. like I you it's inspire of hugely an of going any what transpired be of And in the experience. significant that's the where not operative drivers people influence measure Josh, full-body EOS a the to of believe just to yet data is get from reflection out the automation you alignment way Yes. manner, the terms

automated All surgical automated alignment ability those of and plan into to likelihood your will seem an have be ultimately which utility. surgical elevate the your measures to the their get apply plan. to So

and I have an deformity the rod experience. and kind same have up experience those I was. And patient, to upon got what to that utilize your going delivered achieved on then into of postoperatively patient-specific film, with to plan to ability you I ultimately that like this the into exact gosh, follow as reconciliation, what's the so rod, I and the audience interoperative the compel start select is then so say, patient-specific think what And you the a in would based

the you early think company so a you've We have type it thesis. of run. and is the our that launched haven't integrate things we one I be is it, would whenever seen since the stuff. into this to do a of long we the I'm I about technology, improve what acquire most proud we going tell years. traction to on very was we're think And realized we of the we don't I that expect over that we

And way the those the little would that about experience evolving that are we so committed say into in has while clearly last interoperative things EOS to the forthcoming think and I mid-'XX. been

momentum our based have that is the of but best are of front lateral and on a days so our drive predictability. the the ability ahead surgical our to once yet front, again more and translation excitement lot we on information on And take

next Sandler. ahead. go Please comes O'Brien Piper from Our question with Matthew

start, And Hi, Matt. this a taking question. the for bit is on on Samantha on Congrats great thank our guess a quarter. To for little adjusted EBITDA. I you

can expectation of more beginning breakeven achieved already cadence we early positive to us Can year. for little the at achieve you bit moving what maybe the a what the so that versus expect you You've about talk EBITDA adjusted and to allowed forward?

Matt. Thanks, Yes.

first the year, I heavier that think plus EBITDA from kind or second or half. minus more And little have our XXX at of just adjusted led and a kind with that in ultimately, would EBITDA little the the margin after going margin when less, have X, X, you on we points I is standpoint. you basis bit the math and out to into of look of expansion full at half of in would looked of kind like messaged X% a that that I a how expansion bit operating you think think X, the something later shook year

variable kind that we our so revenue knowing outperformance into of quarter, was kind incremental the of improvement this selling from coming expectation. benefits some in there, expense. Clearly, benefited X the and definitely And then

this And variable was about expenses. leverage quarter, selling think due so I operating to expense of our half

saw in quarter. of front. our investments the on we that bit timing bit, stronger little that's really come I just a So that And a think, little through

ended negative probably given ultimately, I million dollars outperformance, in keep expected have just of that of flip bit would thousands so X. And kind revenue of a little as but up better in than to $XX we the hundreds we we're here And talking about total. I'd just of spent shy think mind from

we've expected. coming I we a we, pretty with, comment, result, we've profitability, that and is built profitability the as So lock think, the to think, being good the as company in architected which close areas is I kind the pleased very and was as as the of we're broader

what that, really is to takeaway here. the so me, And is

in probably in so couple on you by about you drop-through that, which I there balance And of in positive cadence, beat the back million terms half, $XX is apply XX% by drop-through of a in puts think another X% thousand dollars $X.X another half. the second really In of and hundred QX X the QX. QX if the total top-line our the million, think raise in the raised and

about thinking kind of how we're that's it. So

one And as whether also, any we I share seeing well? from Thank then us. a touch taking growth. about market little the But you. you could just you're know bit touched more on

Yes.

mid-single And the we're again, XX%. we've been clinical do think clearly taking if of and the shares. you created I from surgical just growing, the and in and driving to We're ability footprint. revenue and the call market all Clearly, distinction elevate it, our doing of a of when to a distribution the lateral And I is that grew the brought low I think, think clearly the of that's market numbers, I surgeons lot our digits interest and is the attention. training innovation is amount from our to think we're ton indicator getting story. the greatest

from Our from next go Ranieri question comes Morgan Stanley. Drew Please ahead.

go to the questions. bit geographic think still just maybe about your your gaps. can us out In organization. amongst help kind And some sales the some gaps updated a building large and the just for given Thanks of guide of there? the to geographic disruptions, the for in fill talked Pat taking you uncertainty Pat, the anything your with. the remarks, are you in start forward even into marketplace And baked opportunity for sales prepared Maybe little into organization? investment of some that's detail more of market in you pulling just

take Yes. -- qualitative to ahead I'll harder I'll the one. I get guess, the the go and

that and be. who them. as that we with been have in the I being salespeople that's can a spine spine opportunistic think want dynamic possibly I think we're is And the partner as have found aligned in success

the talk years. we XX is about are when of next so to XX people who it an much over to outreach the thing really committed spine-focused, And this to being

If spine opportunity to, spine enthusiasm our us. of will it's work sure, been field us. in candidly, very and companies you with not outreach have you want move like the is And to that's commoditized for to the field an to it's that focused where continue think that

And five of over uncertainty years strange the so I having hugely asset will technology we took it you ago, thing see kind base relates to in some I it's ATEC, and where very imaging, engineering certain, understanding today, of it an call know-how the the And the wouldn't from tell on talent. marketplace, difference. type we're mechanical we say, when to a foundational makes certain place. have a but us the as we just the room perspective, the to tell I it understanding will talent neurophysiologic robotics, go navigation of top opportunity a solicit the retain in the of of prowess provides perspective, Top that you to the a and that

a the in guys sales difference. make the to room upon rely We

us. the guys those aggressively partner And a difference room can so who operating to with seeking in we're make

being big with And so being companies we're somewhat the and the thing lethargic, Globus I NUVA opportunistic. with think

to to about willing terms in of we're invest. Pat And that our and our willingness opportunity Drew, clearly, invest, talked

we've I think demonstrated that.

If we're about growth investment, our fuel growth seeing in you into we're that that think it. to leaning the

we investment certainly very kind of what our magnitude. of the As about sales good seen think previous you about very a level into that's underlying similar the years. in of that's It's to there's order organization, investment where we've baked feel guide, in at and

where And ability relative quarter, to to invest that drive to to so are We change. will, from our might feel about good we quarter growth.

later bit trends? for couple in makes of I the still better we're the full free this of call. just space? thinking 'XX Thank 'XX, but you thinking competitors if are to hand initial on commercializing there of able ways Thanks about but anything that the about earlier robotics, in integration Is questions. kind as a you. how platform, correctly or trajectory Got robotics of taking late or heard it. the And feel that year, I have of one in maybe the to experience is benchmark But what worse when expected some utilization robotics you do that placement kind the other are you you know been

Yes. Thanks, Drew.

love I a And footprint. think small the great a it's what becomes is dynamic question. we

you when oftentimes, there's a direct so a have when small high it you COGS, and footprint, technology, low relation you provides have And COGS, to the flexibility.

you piece, implant? up to the at it way. But regard robot it means that are a type volume navigation flexibility very doing it with the a into the in us workflow to great of some and look gives we I us regard in. Boulder flexibility bus back of also rollout look bring acquiring. lease get the it? to have the provide we with guys and regard going Can integrate so future, And what that that to capability to to in procedural what with think I to don't integrate it's utility the elegant Can to where So I we in ultra-flexibility as

the with structure very cost kind of of is just high enthusiasm our foundational regard to the system. so And

million, the about price, is our to total hence Pat, and the our cost relative significantly deal earn only the being totally to add prices is $X.X million $X.X do to than robots, other types think which and I that, surgeons fact of market and up thing outs price other just five the not point point those about lower to our being given sign of things eminent. I'd ability to core the that is needing

long in a us opens the that everybody. so in commercialize way so this thing more opportunities up essentially run for works to that And really many for

you. Thank Great.

& David Co. question Saxon Needham ahead. next from comes Please with Our go

wanted been it. I've of questions have question. of my apologize you're calls, portfolio, answered. to between about first taking how see if the hopping any been but I on breadth I my the for maybe Thanks But thinking

the are the might think motion-preservation still a other in talked priorities that gaps I sort of product. that wanting focus? then Is And in there portfolio past to about any you've be to address? add some

Yes. The is, filled the robotic big part I a navigation thing think great gap.

breadth we with today. so where regard sit from And we're enthusiastic a perspective totally to portfolio

We'll prevalence of years The of XXs is kind cervical I and the -- can in is we pathology a address the yes. whole answer at hole high the clearly that say to fill look motion. you would If it? come. in

a view. say We're one much we of process some things we -- I next that itself? it's as sit knows but presents in output when I But it's would forthcoming, and Who year. irritating what seems that clear a detriment. don't or see me, the those today, as we'll worse corpectomy have of

designs. have We

in one have very We experience. the early

good than we that, there. are. love where I we're So But other

see is to going understanding system you're that what you're I EOS going for things, our new potentials utilize us translate deformity motor round. in our space expansion the to to our not a addresses not some think ultimately some those of of not continued physiology patient within rotational idiopathic within positioning, to learnings of to kind to see from utilize

about opportunities where And so we lot competencies types. But of expand we a have continue feel pathologies our really of are. patient to across that think different kind and I great to I different

And the see innovation spend ultimately commitment in you the invest address we our had that's really it's the kind built R&D Yes. that I reflection that mean organic of machine such gaps because, of front I of why do. that we've love to we of ultimately, it a so much can ultimately here us.

And I Todd. Great. a have could follow-up if just for

Just million. $XX path on to EBITDA, and I guess, just the $XX million

kind thought of a it kind you I outperforming but think Day, be Analyst of the of at ramp, think you're more would I EBITDA.

Thanks. more look XX%? linear closer would helpful. there Any be to thoughts being with 'XX it could So

reflects communicated. that on in very Thanks, way is Yes. has have the the I'd leverage for about David, aligned itself. one And seat the the I the totally were comforts I question. fact our how company I tell I guess think team leverage great the my is what we've of feel the is that company built the sitting I good And leadership going. you and Pat is where manifesting

the priorities of And business. so investments the the reflect

that we see we grow, leverage. ultimately, as And

and good can feel tell what the Happy I'd march full-year we goals and to there continue so totally And of a it. long-term objectives, great be we is ability we toward our little that ahead intact, the game you and and feel raise quarter. bit our to about is guidance about

answer I'm I our going but giving there, short or to probably of so you hard be a a like And hard chances. number

congrats And quarter. helpful. on That's Great. the guys. Thanks Yes.

Our from question Street Capital Wukmir Markets. comes next Lake Aaron from

Hey is the Brooks. Aaron quarter. everyone. the for This on good Congrats strong on afternoon line

a doing really of we're and about lot good are excited guys going the growth things, forward. You

their EOS? bit So elevated are prepared innovation with procedure believe to how any mentioned own? continue lateral remarks, but the in SafeOp this little How to moves the do you with these innovations respond and a to that all in seeing volumes sustainable you are companies can and -- you in they other responding

Thanks does. the protects competitive that's the about I the that IP question Aaron. dynamic it. gush that for things that our meaning much Yes, the these if and thing is It pivot, interesting kind very there's piece. to But books. well of not know-how neurophysiology the is why a are becomes best it's tough And of that protected, very

I XX think north this of of just lateral, years, years. in XX within at terms

one reality an so absolute the that is neurophysiology, I is requirement. the thing unequivocal know automated is And neurophysiology

about neurophysiology serious an don't participating. to And that people they're retraction so show includes but then not injury, SSCP automated show when lateral, in understand ultimately they different things system

here position that have to look a they So copy when see and we copier procedure, patient a at I what our people with regard is I or can't copy the know-how retractor, neurophysiology.

do. very to And so to difficult a be that's going thing

of competency do to years take to to create. going that's so And and years

And user like type from protected of surgeon experience a and area because committed momentum, we're we're because love are so know-how. making a very And expertise tools. where have I perspective I where these there's the of in that's it's well the love we that's very very feel progress like, unadulterated and long level I why our

the we're of the is the sits and in we my so why general a that's that the adoption, And to to reflective adoption convoy the that creating say, continue grow of really continue distinction "Gosh, sales. will view driving ASP and relish we sales, will ultimately is we procedurally, high convoy

And then follow-up. quick helpful. a Great. just Awesome. Very

your you have just plans seeing remarks, now what well the describe I as and think what markets can the you're in this but you in bit might international mentioned a little you seeing in sort consider at on any meaningful are a are side, the disruption guys? of then And you markets the that domestic for all? priority Would there? also you flip

Let very one me do you international we would is the answer things be to the first. of that I to we want thing deliberate. want tell that

so marketplace, want into And be we we go to when a all in.

early so been in experience has And awesome. our Australia

surgery that how that's doing New markets to tell is like So to great are you, huge Australia people it's surgery. but in the work. who doing great a deliver those markets, business where with and great And got realize are great know precursor to Zealand we -- not I we're very

for Japan. enthusiasm very, our it from years as high. the to to very New lay the started relates come contribution Zealand Australia and foundation is so the And to in We

will thing and Japan. is it's do Japan a same big a great market. the We in market,

I think they perspective, very view in as do. from surgery a a similar surgical vein we

we think we narrow of we worldwide. as the have to so do contribution, about being don't deep. And international is always talk we want feel be like we to and What

committed becomes interest How we that phase the to of so of company? to early just this recreation left. do follow we continue the there very directive in And the the

domestic As there's think of it the relates that I a market, to lot disruption.

there's focused. And the a people, I spine intent. think in that the the is that news also aren't we're that uncertainty. I think companies irritating which global lethargy think that I creates novation And

domestic the to and we very in market, ourselves opportune for some of very think market, in find exploit in opportunity And sitting so a space in to me, I good we're place. a international great uncertainty us the

on very again for quarter. and taking strong That's congrats the Yes. the helpful. Awesome. questions Thanks

right. All

H.C. Our ahead. final question is from Sean go Please Wainwright. Lee with

the on quarter. thanks And question. great Congrats taking my for

you surgeon the to where in back prepared training. remarks Moving increase the mentioned

what's I customer? wondering for certain and the practice And move in cell X take I does training certain a on what's a like of conversions? country using long for to how PTP the rate the cycle, to repeat it the start their So was become guess, these PTP then

to could it's different sets needs, of us the forever experiences. Sean, indebted. we has tell and they of if different No, come each you that, surgeons with be would us like individual

the list confident are what for comfortable in believe somebody profoundly the surgery. procedure within ultimately comfortable. to prepare you they that to And into are requirements me, interest is applying them challenges our make the of one and it's of so to feel sure And

course And very, doing may go single surgeon cadaveric and they surgeons to they need so need go come cases. Other may may they be a may surgery, into course, watch to They one to to experience a proctoring they may need surgery. their they and may need surgeon a start need a very -- a and slow uptake.

comfort, and And And different in so you want that individual to careful. think it's the I they're each profoundly profoundly don't And one make is surgeon. I provide for it this great fix. a the thing should surgeons know,

going And so to time. their take they're

PTP sometimes you, patients into do I on But competed where It to surgeons losing they're And doing got forced need geographies to there because that numerous they upon for out depends an it. be tell it the the upswing there's it. not marketplace. to is such feel

confident. are we profoundly And so

experience, absolutely predictable have but reproducible an is this respond that make to sure suggest to it's surgeons that all of needs to individual we publications the the think I predictable. the respective

that's give can't So long-winded and I I a know didn't numbers. and Candidly, I answer, specific won't. any

to -- that next to understand that I your trend you geographic understand. moving this to growth? adjacent overall into X you going question and How contributing for mentioned much XX is that months? the seen especially. And helping prepared But where on the during see very it's markets, do is market. helpful next expansion remarks over My the you've

Yes.

question. a you would I think are great I it's say And limited.

we then spine cities specific city, that nothing big adjacent candidly we a but happen And so is in. do often, will have may what spend, stronghold the in a have

I established. -- is growth have And of so the our great makeup you're -- seeing been those XX% in territories about that the our part think business

will in so accepted And that business of tool means that, same-store a or type a we're -- that sales, growth will I had expand. mind, that gosh, seeing if in as that my

place. like And so -- but same-store going a to ultimately areas that of And we're like and get to is not would I adjacencies the it's add growth in it's those is sales and people could the enjoy, our XX% those overall great enthusiasm that's would where have growth at only thing we the like say surgically, bunch geography. not that your a adjacencies you're what we in if we enjoy that is XX% to

And excitement. to so me, that's the

Miles call the now will back I turn you. over closing for Pat to Thank Great. remarks.

we your yet interest Yes. as very much in ATEC. best say, our Thanks for is And come. to

we are we what's be on, spine, about excited and it. So going love and to Thanks. serving thrilled

call. Thank you. gentlemen, that all you joining. today's and Ladies Thank concludes for

You may now disconnect.