Nevro (NVRO) 21 Feb 242023 Q4 Earnings call transcript

Good afternoon, and welcome to Nevro's Fourth Quarter and Full Year 2023 Earnings Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. [Operator Instructions]. I would now like to turn the call over to Angie McCabe, Vice President, Investor Relations and Corporate Communications for Nevro. ahead. go Please

Rod Good and Regina. me welcome Nevro's President, to are Financial Thank Year afternoon, XXXX Quarter and and CEO Full Thornal, With our Earnings Fourth Chief Kevin Officer. you, our and MacLeod, Conference today Call.

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to those that today's everyone as begin, or Before federal comments statements the like from we may refer in update Form presentations these forward-looking no the to XX-K, a undertakes call of The Please annual laws. risks meaning any of I'd revise materially only risks. expressed to for on securities statements differ within and report on company including statements. SEC call of forward-looking of today, uncertainties. include certain detailed speak obligation as and implied Nevro's result could made Results of or remind this our filings,

over to press of measures. Kevin. to taxes, issued Kevin? the EBITDA interest, measure and changes as help of investors such and credits, today market for to excludes used in understand fair depreciation call now our financial to adjustments litigation-related earnings items management extinguishment addition, other release debt non-GAAP and stock-based expenses business adjusted refer tables restructuring and value will performance. ongoing non-GAAP a will the In of amortization, refer charges. Please such in financial compensation, from Adjusted turn the EBITDA, to I reconciliations Nevro's as noncash GAAP warrants, gain

us X-pillar our everyone, and today. for afternoon, we advancing fourth and We're pleased thank progress Good our joining core quarter performance strategy. you with on the Angie. you, Thank making are

and earnings XXXX year and expectations. $XX.X with increase X% we to ahead sales under were of U.S. of also the and just the quarter our currency million on period, PDN EBITDA adjusted guidance reported quarter of million, a basis $XXX.X third in expectations. $XX.X with line XXXX, we of For the worldwide fourth and provided on call. loss grew net today as revenue nearly both million, constant an of XX% reported compared positive down A X% ago our operations $X.X our of million. of and ahead from trials that

both stockholder quarter quarter. making on so and from that of growth, will we pain. an today's entry For us which worldwide about a results excited highlight On continue foundation with to revenue the of year year, announced Technologies, million, $XXX.X XXXX, as we our fourth I'll key year constant and very chronic SI patients market therapies a consistent the provides XXXX, high-growth demonstrate can we profitable deliver progress Rod strengthen and very we XXXX first into discuss full Also and execution we items suffering basis. stable, debt value, for Last of acquired are achieve commercial strategy enhance the and implemented long-term our fronts. the call, a sacroiliac reported increase Vyrsa developed in provide best-in-class fusion performance, our the improve on our or was and quarter fourth for number it to full guidance X% currency and are joint refinancing.

pillars. of consists strategy Our X

execution. commercial is first The

commercial productivity, we team's execution drive compensation are To to We the long-term profitable growth. enhance realignment. completed improve some on our remove experience, customer and and to structure laser-focused our sales commercial improving changes barriers, sales made

For implemented reporting a we structure. and geographically focused healthcare example, consumed, delivered more because locally is

incentive-based that out sales on We sales compensation who delivering reps plans incentivizing new to include profitable also as deliver rewarding growth. leaders focus rolled well accelerated as growth

team therapy now our addition, SCS of development increasing focused diabetic on market painful a as beyond awareness is In neuropathy. treatment

As reminder, significant of new the including opportunities have growth in and demonstrated our pain technology a SCS, indications are by awareness traditional is we been differentiated leg pain, at in of our nonsurgical back and success and there forefront back and PDN. driving

programs Last of and education physician implemented we fellows. sessions, advisors, improving professional training for several trained on and completed as new focus surgeons, new our lab to continue engagement courses conducted first continuum education. care hire with large year, we over interventionalists such joint Importantly, and SI pain XXX

penetration pillar of robust market targeted extensions, is through our a second acquisitions. and indications, line iQ clinical strategy R&D evidence expanded pipeline, HFX additive strong The

adoption We seeing full represented of since procedures will XXXX. grow iQ to HFX March. our of XX% implant are launch last increased HFX and in QX iQ adoption continue its market throughout permanent XXXX of

nearly remains patient of nonsurgical back QX. in underpenetrated faster an do a XX% remote. continued accounted expanded than procedures our that next To these the months the to HFX proves expect system implant pain not roughly PDN including the within combined cellphone the indications Our in device. pain in have and the Even alternative PDN with market and patients iPhone, we penetrate of get to iQ, at who to reduced we burden of app, data those with benefits the are patients success with to patients physicians' back for XX% XXXX, more by permanent relief with with alerts, solution an few patients proactive access sends our X%. our XX% with who populations. PDN, which the In SCS is iQ launch for also provide half using even HFX clinical market a traditional

the that PDN months. technology already In designed Global experience. XX-month a without XX to Practice, This us effective a further that the devices that achieve patients treatment guidelines The statement, data a at goal new particularly which XXXX. our second-line SCS from adequately experienced this PDN market announced of was recently of treated in developing December improvements paresthesia. clinical PDN is showing durable first stands we clinical with management more that receive PDN of interventional Panel and study and at XX-kilohertz our symptoms statement of XX, in on April on and patients. and and will beyond PDN study our clinical and are that addressed publication patients one to significant XX-kilohertz published XX-month key superior because our purposely tingling Virtual refractory focused sensory referenced a indication XXXX The with and pain, Research with an recommends by use data Notably, contrast, clinical will differentiators pain. market is a cause pain patients we high-frequency summarizing therapy in having treatments. differentiation aren't further our durable observed sensation Enrollment Worldwide Clinical in to January, outcomes in best-in-class refractory treat are of the to objectively SUCCESSFULLY, trial, randomized RCT, data relief relief SCS be Summit. XX-kilohertz competitor the sensory now we consensus Global to Carelon recommendations coverage mask that publishing announced experienced for policy Health therapy, the our initial for PDN.Also is We penetrate our XX common along society and that Interdisciplinary improvements therapy innovative this, SCS expands We of symptom pain PDN pain shows based or the designed prove at help Diabetes which therapy, Diabetes our believe additional competitive

result, million approximately lives lives, expand As million. PDN nearly bringing by patient U.S. additional total a covered XXX coverage will to XX

about with several acquisition, this to the therapy working continue awareness more physicians are our to expand suffering are offer to from Vyrsa excited transaction for we first-ever PDN.Turning to reasons. We patients now and excited

now access the be to minimally market SI and expect adoption and the have U.S. joint The market. is we procedures alone, growth at a billion we a surgical in increasing large valued to this invasive space First, in driver. $X currently of fast-growing

Second, to the our from chronic benefit with who added patients as has are relationship of procedures, performing SI are to physicians now implant also able joint many treat strengthening perform we these offer This are our them pain. suffering many options and more customers. of physicians procedures SCS them already

market. and when commercial are current have in joint relationships SI largest help adoption salesforce drive leveraging salesforce and trained, fully growth. their the that our we physician will noted Third, to should be the we It

and estimate to and both pain broadens portfolio. pain our to SI XX% treat diversifies neuropathic it that the pain. offer mechanical We lower with patients we originates back and with approximately that now chronic of pain in Finally, have options patients joint, XX%

portfolios of comprehensive one also SI of space. in We most joint the offer products the

which Nevro Nevro proprietary like and the joint technology, branding. allow is be to to We long-term an transitioning Nevro Nevro to the immediately portfolio to optimal with critical the Vyrsa of comprised joint is Fix. on our system market. product SI preparation, fusion products naming In achieve interim, Nevro-VX, VX SI as there our the other the process SI joint no of joint flagship transfixing Pro is BX, will current and Also, integrated proven device are for transfix in Nevro intra-articular it instrumentation fusion. fusion. is allows

of health train SI which ultimately meet a growth, reps growth and for X result, With helps we launched the comes cell Finally, needs, up of full codes to ramp technology, suite of this CPT helping varying able SI all In and products, throughout business. both we'll Nevro-VX outcomes fusion. as and sites joint our of early patient improve patients. products, we approaches, service, available the we and physicians the our are preferences with of reps different quality enhancing continue for joint physicians for this life and to XD-printed accommodate January, to different as sales XXXX training bone promote and bone to

physician market addition, this month, overall far. limited In and release started while feedback early, been has positive so our

generate done payer the evidence in SI driving coverage. will just Importantly, medical important expect the in in which have SCS, clinicians as to adoption joint space that is and clinical we and physician societies continue we

new but of previously our won't the of here will to developing impressive pipeline, joined go salesforce, new into that of We reasons, the leverage we SCS. detail into one our asset, I revenue why on expanding pipeline communicated, Regarding because for Nevro competitive was indications streams R&D I and as products. reasons for largest continue our work

pillar progress. our profit is Finally, third strategic

manufacturing are through expense management. Rica disciplined our to processes, and have scale efficiencies streamlined goals Our Costa improve facility,

included our While In a there this restructuring, X% January, implemented with and leaders across we employees. we off making is which more teams are front to of progress do, laying the on organization. our

the of necessary decision, remarks. a will impact Rod Nevro was was difficult restructuring long-term talk his for to it in expected very about this the profitability. and position growth While financial

I As sales postoperative by salesforce support mentioned, drive our These joint. are require commercial team, follow-up that allowing procedures adding we in SI reps on already pain that physicians call growth our patient team members. treat limited to leveraging without revenue profitable grow to will patient

world-class manufacturing by also technology. our We which to manufacturing scale Costa supported experts facility, and continue is Rica

We and will via we expand through products acquisitions. new leverage tuck-in business it the R&D as

Before I the want hand couple to comments. to I Rod, make over call a of final

thank Nevro to their pain. focus want the members burden freeing patients to our I commitment our on and for of strategy team executing chronic from steadfast First,

meeting Second, XXXX sales team. we our recently for held commercial U.S.-based national our

SI this of for the enthusiasm joint for For excitement entry was and the Nevro core future. business, new participants, showed team great our meeting, and space, their our members into first sales many

which and dedicated by transform and provide lie the multiple which superior the across data therapies. strengthen innovative on opportunities access patients XXXX to are indications, enabling is in that made our RCTs ahead. our mission clinical allow stabilize building business will in is to our foundation, to we us greater our progress to therapy, through us We several supported XX-kilohertz to are

guidance. To the execute call and fourth drive a of strategy meaningful on capitalize for financial increased now and Our the to results our goals opportunities our positive over cash leverage profitable, operating same. shareholder to long-term growth, I'll quarter XXXX discussion Rod flow, turn and remain value.

and Kevin, everyone. afternoon, good Thanks,

over charges worldwide, days. the number PDN million of grew $XXX.X an and to of as on same and revenue U.S. period, points basis approximately million, shift X% increased to the a $XX.X and procedures XXXX of $XX.X the to revenue periods currency of decreased flat Vyrsa sales was Operating reported to on and the increase current represented to $XX.X due current well revenue to XX% period. $XXX.X XX.X%, the Gross in scrap-related XXX increased year reported X.X% spend had by year constant expenses currency profit business, growing increasing million, reduced worldwide by prior in grew $X fourth compared basis. a implant million, as the as For a in to primarily and quarter related offset prior X.X% International permanent with across X% million, Both selling margin XX% $XX.X X% gross year. indication higher resulting primarily constant prior million spend. onetime products margin lower million. of as basis. PDN driven as

paid million November activities our September million XXXX. related Excluding XXXX XX, XX, $XXX.X received Cash, short-term expenses restructuring, $XX X% in of down expenses to by of the cash compared include investments million acquisition million net Cash from legal were and versus $XX debt the equivalents cash as Vyrsa. operating offset XXXX year. December our from $X.X expenses, $X.X of increased quarter for in in funds finished $X.X Vyrsa million fourth prior with million 'XX. Litigation-related

for we our up Vyrsa to cash closing million and November we additional announced, $XX certain quarter and achievement transaction cash of milestones. to sales fourth an results. was pay immaterial As XXXX, revenue in stock at XX, million development tied agreed the in The to $XX previously to acquired on or

train believe Kevin the physicians need over few in As begin we will patients procedure months. treating that remarks, his on in we next the as commented them

be continue this revenue year. adjusted both to We EBITDA expect to the accretive to transaction and

reflect and The half on while training begin half personnel, year first commercial increasing the we'll the revenue second focus field year we'll of traction. physicians to of the Nevro

announced other The credit from used be the to to immaterial SI for of XXXX to reminder, out were to and as of majority we our well XXXX loan restructuring facility. November term Also capital purposes. year. our the we notes repurchase $XXX through joint contribution maturity XXXX, corporate on a the XXXX, working overall expect for of revenue pushing the a debt, a as XX, X-year million convertible proceeds general majority As

of first a discussion Turning XXXX our and full year now to quarter guidance.

XXXX, full X% to $XXX X% expect basis. an year the of over year For of full a approximately and currency revenue $XXX representing to million, worldwide on reported we million XXXX constant increase

the low competitors reminder, replacement that recent range, competitors. and of it a our quarterly appears all SCS most results the our we their is grew mid-single-digit activity primarily As have excluding major to believe one market reported what in by

with gross margin margin of be XXXX to flat expect We gross approximately XX%.

and results facility material excellent manufacturing manufactured products. Rican Costa produce Our continues to costs for on low labor

excited can levels and higher current However, mix pricing Costa full Omnia the higher impact assuming mid-XXs, inventory levels. and cost to delay a than Rica longer-term the margins holds initially the expansion will projected we margin about few in deliver, project continue quarters. improvements at We're gross

range We largely and flat expect $XXX with operating million compared $XXX of be to million the in expenses XXXX. to

litigation Fusion growth Our PDN to expenses drive operating and SI ongoing guidance XXXX expense Joint and our includes portfolios. in investments our product

restructuring, normal benefit million We expect This negative from to to be January EBITDA million million sales our increases, $XX other including To normal and approximately help implemented million. modeling, expect will in largely expenses. $X merit XXXX, negative and be expenses down $XX our we the offset we seasonality expect operating to which lowest XXXX. with which be we QX XX% inflation, includes your to from adjusted acquisition-related $XX with QX quarter, announced by

as reflect and QX, from to also results downish the a stronger we a the is field strong year for second our regarding historical our then where commercial SI sales from and events These where follow projecting slightly national growth typical Similarly, conference remainder earlier fashion our QX due execution. sequentially QX with with QX are our pickup to demonstrates spend to the improve largest and our We what will our to such flat quarter play QX. joint out NAND customers half meeting, of in finish seasonality, is revenue training Kevin efforts expenses mentioned operating team. QX,

an to quarter $XX quarter million and basis. expect restructuring a and EBITDA X% a Worldwide to joint $XXX reported expenses the to of $X and million January 'XX $XX restructuring approximately $X X% to revenue negative related spend million, of over which costs to of first SI higher-than-normal first million, of For following. we to representing approximately on the million. XXXX, constant currency layoffs. of $XX the the Operating related million $XX training, charge approximately adjusted EBITDA include Adjusted million negative exclude be to increase will

about As we significant XXXX we made In of closing, previously to quarter communicated, strategy excited the a value. no XXXX, know our indication ahead our long-term deliver opportunities foundation will enhanced PDN We're executing that stockholder in breakout changes profitable questions. longer for committed strengthen to beginning of Regina for we growth, our to in us the of sales. remain we have first the our open business further will position we and call more and do. work and to now provide

first question will Stanley. Kallum of line Titchmarsh [Operator Instructions] Our with come the Morgan from

dig Just market you've growth. into X% guidance SCS the out Guiding historically if X% possible. historically. more growing to a wanted know X% to between called to for I topline X% bit XXXX around the

some considering relation there salesforce you conservative, now from would or You've that restructuring is guidance the if place here? 'XX. too. we lot. could us comps obviously to just just broader something Thanks reconcile The softer is be helpful this else being to Is market. a got help in in be should It

ramp-up back the Yes. as a few around back of and excitement their down our be was PDN we start That space are gives products there. be is you overnight outperform quarter skis public think us to new that of little low year going competitors we guidance pain. want to if look some in our looking and have now, the growth, of felt we'll us and to bit salesforce believe new the our last the our X% maybe that get some Thanks U.S. the this the with to to to don't well for markets in as nonsurgical all of out a market We front a Right Really, already with for in off a year. looking given flat the is a question, the competitors at to make pause where of of competitors, announcements. and now, our They as X%. mid-single-digits quarters good we're growth X and Kellum. the market this indication already for company, to the

follow-up, that's we the that On no in okay. one do number play? obviously QX. And come specific XXXX just comps around here Got you. if you that I will tougher about saw the given under eyeballing feel expected. as think just the I just PDN, of more estimate year-over-year. kind level indication is How XX% growth But guidance into think that Street,

curious of lot. we rest Just the should for of guide. how the absence year the be about the here Thanks in thinking setup a

Yes. providing Kallum, as to be breaking guidance going we out said, PDN or we're not forward. going

to it. And in now. PDN for last SCS quarters really outlined our that this think of I said Kevin we just to kind the think couple to of competitors is market is of single-digit low growth. SCS the of flattish The overall from right been posted in the growth the our past, think at they've an couple way They've about look right are maybe And year, all a way quarters. in way have perspective. it been in overall As we for the --

of Biegelsen the Larry with Fargo. from comes Wells line question next Your

is Treybeck This on Nathan for Larry.

for data. Nevro devices on question to Fusion differentiate Vyrsa? to a Vyrsa. Vyrsa? Just How develop from guess plan built you what's reputation to do Thanks. be plan clinical its on I crowded. And data SI The the seems market

were An we of some them, growing a a at And we And it's That's had getting digits. a the for and little all a reason category, they why transfixion were all this The utilize all space. crowded a it's companies the allograft, into products that device. also patients. gave the clinical but a Obviously, need addressing space as looked lot different you space. fast-growing we Vyrsa space, X. screw, evaluating what this us confidence could a Yes. small almost that acquired as of was private companies, double as of is well for fast-moving

it that after. go so the gave company to was right us that And confidence

take have to our the relationships relationships Additionally, SCS get all largest as they're especially feel which and reps' to to market, we'll the we some a that be the physicians I by physicians, mentioned, We now far that with we combination time. them with once able able off joint salesforce once in to SI be in fast trained, the relationships implanting get start we with those those have that will trained. utilize

year? new Okay. that share 'XX? for Thanks for in what And does are competition to expectations that. And guess how for Thanks. SCS your follow-up, take my ability I in your influence the

Yes.

in we the our that superiority still believe different out reminder, the that's only target whistles following from commentary believers listening after we else the that market, those other. are out XX-kilohertz a frequency all a there they're the each competing from We'll other As we're and steadfast coming And continue have competition. studies low they're with our just and and clinical into differentiate bells the clinical high-frequency from companies, in that us there is to everybody technology. going few low-frequency that therapy physicians against

competitor, while players the we those having any from look in believe so, to away incorporates never And our we market. X want guidance new that

question from RBC next Your the line Shagun Singh with Capital. of comes

for filling your the wondering lastly, into was outlook questions. that. XXXX, just take And position. thinking taking wondering if get about for kind expect Thank was when I I on like bag. if Because bit could to back you acquisitions then talk there any are your a 'XX how the you we it doesn't updates and further you're reflect Kevin, goals priorities Nevro a key and about seems can little of share

course. Of Yes. course, of

And Chief salesforce it largest we those fourth and talent positions of we a as of know, came of speed. Greg of takes to Siller, make up to that on had X As the really we in started realignment in the looked last sales result, at quarter. get X third some history the came to And Officer, changes. certain of classes these you I the months of the end company the training summer. some had in and reps our for the and as year, some and in board said to the April We Commercial on

So yes, as threw the to now they're little we we this and new then acquisition in bit expect to QX get year. that their hit starting stride a to into them probably we a same And obviously time. QX at learn all

While to to in one? to we to it new our a up do as know the with that But will far to longer want may X at the months we it with mark. you And the term have some up long the second this would us those head-to-head in them our competing market, be to reps sales how competitors great second speed, is them as going take like get like field. chances QX time take speed. the we hitting question, said, take Rod, most get out of be we

might and can be. Shagun, future we more getting Vyrsa, let Yes. might other what us a -- our also a comment a of as little trained, be and with fill talk and just we we well, other our sales energy belt the but opportunities can bag? think couple maybe thinking Kevin field have the get everything the outlined, in on what on to going some of asked quarters physicians force I Yes, we training and you this about about Kevin under acquisitions effort to lot about

from Your Adam the with of line next Piper question comes Maeder Sandler.

in in maybe have just Two launch ask wanted that pricing like and question, for the out is the in I know ton is new Or Kevin, going that to indications how then still continued there? Thank think flesh do about feel And should potentially we to shape and about quick And or pain related? about but guidance to think iQ not 'XX ones else? assume this ask XXXX? and new still it the to second fair it I comment, for say me. or is about how revenue this I you. here, some for assumed a SCS. XXXX streams form way, the of I event Is something what's you're timing we a And price. with

development, take I'll to then project the you caught over that first the second right. one Yes, Yes, and it Rod. on new turn

and love we sell working our education We I table channel. some the teams. I crazy those loyalists clinical have we what the do is talked first we've there. Nevro of to bring stay joined said extremely our our going. When sort with R&D places asset the that to of they DNA and are we great the won't to that would superiority dilute working company, that one. then want as we of about, largest saw were And anything who that is which well, with our close reps what really and on they sales over like And stay we and points we Rod sure will and sales those close the We'll take us have will customer-centric organization, products those do in And home leverage make organization. which sort call can mindset XXX-person that were to the home leverage are that in our

as flat up Yes. a Hi, reasonable should average implantable From about is perspective, Adam. a mix slightly to go overall On up that our average pricing, price assumption. pretty the the little one shift you think to bit. think to of continues probably a about iQ, we selling modeling that towards devices, price is, see if way of it

question comes next from Your the line of with Wuensch Citi. Joanne

Joanne. actually on Anthony This is for

terms getting it's you but Or evidence aren't maybe opportunity so more pretty this bolstering about under Maybe your just patients I into about issues? chronic early, I that it study, get and guess have, neurologic payers sensory some sensor belt a more just broadly, the is follow-up. And related guidelines? I you on is but can have more do had the its First then patients pain get just of know indication? thinking experiencing additional in

know, the to strongly than that clinical now, well. and study one study, and we've kilohertz and that a that We're for first had tag we plethora additional for lot have we'll be both, you RCT give the differences that's to come to responder us because require only societies, a us second into them and pain. allow there's chance what you just of for of their more of more then Having really significant us be will And indication evidence an -- out pain. difficult this had frequency. into on one this that believe be study second us to specifically technology. large it's gives new, actually XX to be information we of large guidelines PDN to strengthening and Anthony. and at showing feel will better for and will to first of opportunity prior have addition as on typically that doing a on a clinical the and your When And will It's between But in Yes, study. guidelines. than we're in maybe Right that's really with one sensory Then better RCT you biopsies payers the most likely as to going a Number guidelines more that indication follow-up? look recommending which will they in. sort a This be of is you benefits a market clinical one looking rate. we're did of that sure. outside other is, just things typical was have the showing of just others low

Yes.

million was it insurance Just vein, the sort the Are left Or or side of other of announced you either sort any think just Carelon it on wins big or is I XX PD just in at there payer I substantial more for really know in lives. carriers this point? January, NSRBP? same smaller

-- as Yes. There's it's decisions of proud lot different of Medicare there. so of a obviously payer our team. all and decisions. well. There's really diluted I'm local There's that

customers was clinical indication our are together team at first that the team Our to a our it through of denials the and evidence the the that to that you PDN process that those. one here of was evidence overturned. help And And Don't is people getting prior gain in put clinical place. forget, have authorization. those utilized able look be to how the also we got

much a system. few that allows a to have go rate. coverages, come the the more all friction to here really just to future process What be those that and a continue do We well. as we once of our and through in evidence. There'll gain less quicker success leverage us to does, in lot going the with it clinical high new We're

might you Petrone Your the mute. from next be of Anthony, Group. comes Mizuho question on line Anthony with

Our next line come with Newitter of the will Truist. Richard question from

I'm just to Maybe Vyrsa, curious. on start

fusion? on up? As are from expect you commercialization the the begin practices that here, you Or joint outside ground performing do initial focusing be building on physicians planning to kind of your already you are users initially so

or are Obviously, to Yes. I that procedure. of Nevro those different is are have here the already patients are the also in locations. But play relationships loyalists interested the at leverage that all think doing smart already we that

Nevro limited scaleup but good clinical with those we're people good the and team. the at look with we and of everything and continue the are studies been with really is, those else, first relationship maybe starting manufacturing us a of involved have doing closest place to expand. this the with. are that device Because people Also in all trays training the we're We'll a have start patients to we for believe, we that past, experience. our what and As then that in there, to

comfortable. -- need and to want back reps X X cases only will don't go a procedure, we one of the that all them helping learn area cadence our the learn and not to operating the we to sales of our to in first things we to or our hold to sure the in through. also so physicians safe those it or physicians And for theater through and confident have was different tools some but standing that feel And need also go to them that of and do effective get the but to X make market, just

for Congratulations Got that. curious, been maybe Kevin, buckets kind gain different of year so as on execution share incredibly the full as thoughtful Vyrsa. important. your on clearly we of think market and guiding Thanks. of think the I'm been you've obviously about overage And we outlook even I just is very think, growth, success first differentiation, so CDN if it. and far far you've potential,

you if But you Where the You do that? buckets you've a to relative were what that me where most baked in are. tell expect confident come? to to you overage feel in are most potential confident it the where conservatism? Or guide would see

I confident for is still long probably for on for the What also. people here people Yes. We about there. and and kudos Thanks there the question decades we've a to most been what as last We've the feel our spent new proud done That's good passion some, including months year, new many really way many, go. most I'm to that what onboard. about. in as team. of the our the adding and realign energy and the coming X years, well talent I'm both have salesforce have

SCS tailwinds headwinds I with go. have chance that. have that feel However, on revenue that to products, tailwinds do gives different those Vyrsa to come now indications some like that any as more us obviously and the and different and X with we And opportunities good there's And acquisition maybe a headwinds I to streams of counteract X the always well.

of team. coming year our feeling early our really the of next heading and sales that meeting. so here to We've week where national good out but sales exit about global is into got I And sort it's one now, coming right up too with meeting team also think tell, I our we'll like the

Our Brandon with comes next the Blair. question of from Vazquez William line

give side. that especially like curve PDN or there the referring on physicians Are with today. are of the Maybe you on -- in any how trying first referring maybe durable understand where Just can of the physicians us to terms kind you metrics this one like be and figures? adoption the number PDN, can same-store of growth

right it's of any be endocrinologist lot the podiatrists to Yes. know showing schooling. or now the clinical there prove do first may kind they back none And territories, groups their a endocrinologists is showing this, referring penetration. other we XX stat early blanket you we're and the with that that's missionary They've have that. the month so believers do physicians, physicians. phase, technology the This city. we're for we're learn as going hard In are but surrounding going or say The clinical indication, so the first taking those there podiatrists anybody, big we're in missionary I'd each of X% to that my that put the something to new I'd movers the of through. have now, I there's results. that is statement. some we I the of that that one that those into that patients our this evidence in selling X describe different what, are didn't unbelievable say, X come we're patient we're of then those versus providing any mean feel superiority efforts continue of under that But to selling of out X others and where and a a building or still referring in there's growth X of or another city right

great consensus people now the but so also back statements comments great from to coming And the confident I'm patients. in these remarks, had go evidence PDN. and results prepared Again, the we've referring highly now clinical in showing out not only

we're think and way that we about I helping go, to patient a long population. have excited still

maybe one up Kevin, year And a me. been one in last coming you've in for the soon. Okay. seat

one the needs COVID, from had that range? little be Thanks. core to flat you down SCS You've that experience What your to more it still maybe here so been do curious have looking to gain with it closer you are markets recovered more the now this happen to that It thoughts what this market. single-digit think at of to high seems seemed you've a to post hasn't as experience. to get

in one regardless about believe the we go feel the that we that Yes. to market what of our control of increase our what great are. job Look, where because and And thing the them. for have That's one with we they have do is, pillars, our of and And so patients It's effectiveness is salesforce. we the we we know can the why top is And evidence. X do implanted share. I moral to year, teams can out our job coming to better this to to always clinical product we the it's obligation have we into it's take growth get a win, that that say superior control.

impossible. opinion forget entering has are product diversified we're SI the market our the what back obviously pain, would now recover the From and but also the including joint, to PDN, evidence what chances leg the technology. opportunity But To not with the regardless work put through, on portfolio, that the only it's standpoint. to that does. experience a predict of back-end that that clinical growth SCS believe entire core don't nonsurgical includes confident now but Now the be We we're also and also to core we new future. in I our obviously market like our market SCS growth on doctor's in from they market indications we want to standpoint, believe continuing

We for lot have of growth guidance have us XXXX. to growth drivers X% that a other the led to X%

Your of from next Plovanic line comes Canaccord Bill Genuity. question the with

say contribute is, question. have like how split that? I And The global of business, that U.S./OUS the about for XXXX? wrong, as then growth, total this you you the in thinking and first like an then I question heard think expense think maybe what And are $X just will think million do we Vyrsa did you you

always, Good job getting Okay. Bill. X in as

On guidance say our we that $X Nevro, all-in said I million for we first one, range overall our commented is no, guidance everything. includes put in for XXXX. which out X% to not that the did just X% there, I

international opportunities. we leadership global some feel that our teams as and our breakout, about have the far we As We good and think our opportunities. really

team joined. international likely much XXXX a has next summer opportunity that is hospital and than Now not there good or But in now that also were were going it little -- or so demand a of doing, back a better in on into was and our in bit still we shortages In we pent-up XXXX. off staffing a we that lot when believe believe believe our U.S. lot markets, team I back the international year. still of

feel confident ready spread probably growth are equal globally. And so that our we and for XXXX teams

is Okay. And million. $XX the then that on listen, for expense mean excluding I was, onetime deal, quarter fourth the management, charge

You're annualizing million. at $XXX

to of up the You're from taking reduction, just also gross an and guiding headcount on mean like expense put just you standpoint, commentary kind what unless I takes X% real XX% OpEx a trying at especially low mean, understand margin seems a that's it I'm puts higher. the XX%. I something. much when are, you're but missing the a I'm bar

things. Yes. Good A question, Bill. of couple

take margins all, our seasonality not annualize. of lower QX. Also is necessarily to remember the of to XX% the quarters, were actually that's our one best First operating one spend. not XX.X%, of so for QX expense

you $XXX benefiting the did are expenses to from last traditional little this little we $XXX over well. through as a We be a do throughout the remember to restructuring are million and there operating do do QX, that For reps invest our will that have the we train have in we in we're layoff charges some driving Yes, close But bit. it impact in physicians. in we'll that year, in year that anticipating But Vyrsa bit the there's -- inflationary merit QX increases, up that be There running operating expenses are -- we pressures. million. also of P&L. be year X% and will to if

X% expense to we the those basically a flattish what's layoffs, and of will on we topline the growth. offset largely as lead operating to All from X% a receive roughly of, us that, guided will said, kind benefits

the of comes Your Anthony with Group. from Mizuho next line question Petrone

popping Apologies. between I was calls.

that? market come the stem, past way the we X think to to Kevin go like have it looking they've the that and be back out seen rebounded as driver? seeing failed procedures ancillary results. And an from looks conditions like on board Should for spinal leg new Sorry be have to months that. you could still XX a a Maybe broader thinking want look you back. spine some about member. Is pull-through just let's competitor would actually that in talk based at after strategy. And actually about of surgeries. I to We're meaning be, just right spine here maybe to close here, follow-up quick as say about that about the high-level a cord

intact expect deviation? As have the a Thanks we with think do Or tuck-in you could again. Board a little a strategy that's on largely shifts slight here acquisitions the we a bit, and refocus core?

Thanks, Yes. problem. Anthony. No

off it of So different not, analog there left patients are go right? start reminder, yes, on market journey, sometimes then cord for procedures to you do where that as good conditions, spine sometimes We through And and you is can get jump approval know if a be implementation. a don't get lot to a can off. a need stimulation before you spinal that they that to

there. patients I we stimulation those to of before of to -- But spinal the have that do you months will and know some lagging. through through we're that that seeing take care in go and lot for of are about are right they back peripherally we're of continuum the there. go rebound before of implant. cord it of from sort if number other get go That close care get markets is hearing X to growth sort sort procedural that the the that sort that us. we But time to to XX go says You don't conservative trends like a

is back One pain mechanical well. of as obviously those

back And we treat some talk our well XX% Kurt as the us routinely as the grab a the us them That's, I he's down We're to got is what led as have our excited for their close financial like an of gives earlier going acumen, get shareholders. you a as we continuum and Board, worked for little in It's other That to Board the which procedure the pain. street care. bit Before We market. chance do. work extensive yes, helpful both to as We mentioned we of he's It's maybe neuropathic into said, well local, on us, also us. and far that calls. to something as announcement. as be with with these our patients after will patients to experience all side experience of pain, here investor of SI on neuropathic to joint as acquisitions, mechanical the he's in well. believe XX% in

supported believe We time. strategy experience a we really financial going we in with of to want this, acumen. cooperative thank have Board thank good with gives us longstanding I member, we medical agreement we he's sure We and through our will that that and Board a us And in alignment him lot change the have for believe opportunity and of shareholder so to time right members Board. our our the and Board us variations good that stay one of we've do be make through longstanding, a summertime. had Board it good to a we the he's through you long towards a believe here change, the been in it's outgoing our will and now, devices to say plethora and been for taking periods growth this that company been business. for opening a He And to our course wanted has instrumental both the Frank. forward. with public, And with members our will he and for been taking will be instrumental leaving his summer the not do

Oppenheimer. Your line with comes Suraj the of from next Kalia question

SCS our more about Kevin, changed? can of traditional NSRBP. that the X/X coming X-year recollection so opportunities Because things tone roughly is anniversary for towards if frame me to you as just business, of call for I couple Has Kevin, you the on hear Nevro the is know was I your curious versus all I in look Rod, a sense from right? was could And you Kevin, Perfect. us. traditional shift the a PDN. up.

field And told of $X-ish characterize $XX us guide. track checks million me 'XX or for if dice I that my our was and doing can just if million taking in on I'm question, it Kevin, second million, today, terms wrong in Thanks for have questions. we so is in great. that Vyrsa the Correct around could, where could 'XX. roughly did that FY'XX slice NSRBP would $X you If be

Yes.

On first one, the no.

of back experience I take that as have for we the and as patients lot pain probably both which well think say are same leg we PDN. There markets, opportunities and back We a comers. at nonsurgical those time. all core of the

at For same the instance, you from diabetic time. suffering might back also have leg painful and be and pain neuropathy

space the change from lot the the in really really the coming we're there, fact growth a of seeing be game, third. than would start other you're a of that. Not the tremendous in So brand-new no, still of opportunity PDN second surgery we back it's then the because failed that still be back pain we would big that opportunity. market is early then has Nonsurgical PDN, have believe still and and largest a just because the

we're model checks, from distributor there. thing direct field anything a the as far a not will on commenting add is are primarily moving As One to model. just I we

and both procedure. from organization needed it take up the so well our trained we trays that some will as have And of operational make to to scale sales that to speed direct perspective as us force that sure an and from manufacturing time the perform are for

the from of Wolfe Polark Research. comes with Your question Mike line next

revenue? be it. probably about end question. here that guidance Can know we'll set. what's -- the formally or the on it the calls what is, third I'll it this frame I'll least moving I queue. considered like in suspect making calls of asking time forward, you say asking Vyrsa, ask the guide. a what's if on -- sounds I until so quarter least XXXX don't like for for a number about at to Thanks I to the guess a Vyrsa ask can again at you taking for into us at number look, that. it on every And want just give I 'XX comment to just we'll built you not, you level Maybe appreciate get be like this the

just we great appreciate now. we're so want we're I checks in a Yes, due is and know the that, going that technology which some Don't market really direct, have mentioned the We and about we're from right showed is to our really early, a desire device device, and diligence and the company flagship are small we in VX where did with differentiated completely we that one. excited still some to forget, takes I think to that distributor this time.

it's to ramp be have It's organization. future. right up the breaking start that just be the that that to can will nonmaterial out. so something now, appreciate not into But that time We right the we desired will that

Our next question from line will Marcus the JPMorgan. Robbie come with of

second in for Congrats help Nevro's the had on a loaded. us won't good that Maybe the ask half Vyrsa, understand quarter. back-end of growth as maybe but the sales were I several assumed guides you year, ramp in

worked in out. didn't. Others like Some, XXXX,

think help there. the I investors want drivers to understand

I and a coming more $X We back from ramp. Is and where do coming impression Vyrsa about Thanks. million confidence percentage salesforce guide that salesforce immaterial, and understand even understand million, $XX I SCS? help half percent. on the points, million, also about and get inorganic, it's Maybe it's few this restructuring. revamp selling the where million, it's talked but think so track organic $X exactly $XX was the to to it You in us under really Is from? a year. the about were

that Nevro up of by the the has opportunity and team done the we of by Keith, take we call rise all a salesforce some also That's tide a it upping there prior all them and in talent of some a the was that back-end which the couple top get of -- have as off hard it the a that he's to to loaded. mean, the rising little that with pain, new the work would of had but But turnover organization, we I sort hard same a that have the in in does prior. market to Yes, a recovery as we little was here set mentioned, it's all did above. I time, of we organization, to bit boats think indication realignment little done restructuring, and PDN bit really have been spots jump of caused we really me, back across bit why the speed. foundation there's to part it's of up some on prediction more nonsurgical didn't that the professionalize a past, time the did sales at

quarter The in bigger other in well, or look for to yes, that's space. there part QX. X been this it's going And as else from lastly, I mean really QX our then expecting people's business we I that's small just and natural us single now decades this yes, nonmaterial move seasonality forward. that's right to co-pays that that you of QX we're better do every And is everything just is seasonality. than at much seasonality space, all in so mean just a always happens, with

new markets that devices that device, market a X are have in. we so a new And new we're new in, that we're

think the reps year, out justify be so in end of this Training reps little that. of training take experts there. to do to need over us we or bit helps since XXX a of a some train that back XXX different specifically XX will many device. time to I the our than lot is It

conclude does for may and thank you now Ladies all call. joining, gentlemen, disconnect. today's you that and We