Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2023 | Oct. 27, 2023 | |
Cover [Abstract] | ||
Entity Registrant Name | ALPHATEC HOLDINGS, INC. | |
Entity Central Index Key | 0001350653 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Document Type | 10-Q | |
Trading Symbol | ATEC | |
Document Period End Date | Sep. 30, 2023 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus (Q1,Q2,Q3,FY) | Q3 | |
Entity Current Reporting Status | Yes | |
Amendment Flag | false | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 136,300,664 | |
Entity Shell Company | false | |
Entity File Number | 000-52024 | |
Entity Tax Identification Number | 20-2463898 | |
Entity Address, Address Line One | 1950 Camino Vida Roble | |
Entity Address, City or Town | Carlsbad | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 92008 | |
City Area Code | 760 | |
Local Phone Number | 431-9286 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Incorporation, State or Country Code | DE | |
Entity Interactive Data Current | Yes | |
Title of 12(b) Security | Common stock, par value $.0001 per share | |
Security Exchange Name | NASDAQ |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 122,526 | $ 84,696 |
Accounts receivable, net of allowances of $850 and $679, respectively | 64,519 | 60,060 |
Inventories | 130,672 | 101,521 |
Prepaid expenses and other current assets | 15,841 | 9,357 |
Total current assets | 333,558 | 255,634 |
Property and equipment, net | 133,785 | 101,952 |
Right-of-use assets | 27,086 | 28,360 |
Goodwill | 71,555 | 47,367 |
Intangible assets, net | 102,196 | 82,781 |
Other assets | 2,041 | 4,874 |
Total assets | 670,221 | 520,968 |
Current liabilities: | ||
Accounts payable | 50,104 | 34,742 |
Accrued expenses and other current liabilities | 77,251 | 72,382 |
Contract liabilities | 13,833 | 11,956 |
Short-term debt | 1,766 | 14,948 |
Current portion of operating lease liabilities | 5,090 | 4,842 |
Total current liabilities | 148,044 | 138,870 |
Long-term debt | 506,613 | 349,511 |
Operating lease liabilities, less current portion | 24,496 | 26,562 |
Other long-term liabilities | 11,626 | 17,089 |
Commitments and contingencies (Note 9) | ||
Redeemable preferred stock, $0.0001 par value; 20,000 shares authorized at September 30, 2023 and December 31, 2022; 3,319 shares issued and outstanding at September 30, 2023 and December 31, 2022 | 23,603 | 23,603 |
Stockholders' Deficit: | ||
Common stock, $0.0001 par value; 200,000 authorized; 123,324 shares issued and 123,311 shares outstanding at September 30, 2023; and 106,673 shares issued and 106,640 shares outstanding at December 31, 2022 | 12 | 11 |
Treasury stock, 1,808 shares, at cost | (25,097) | (25,097) |
Additional paid-in capital | 1,062,919 | 933,537 |
Accumulated other comprehensive loss | (12,111) | (10,794) |
Accumulated deficit | (1,069,884) | (932,324) |
Total stockholders' deficit | (44,161) | (34,667) |
Total liabilities and stockholders' deficit | $ 670,221 | $ 520,968 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, net of allowances | $ 850 | $ 679 |
Redeemable preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Redeemable preferred stock, par value (dollars per share) | $ 0.0001 | $ 0.0001 |
Redeemable preferred stock, shares issued | 3,319,000 | 3,319,000 |
Redeemable preferred stock, shares outstanding | 3,319,000 | 3,319,000 |
Common stock, par value (dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, shares issued | 123,324,000 | 106,673,000 |
Common stock, shares outstanding | 123,311,000 | 106,640,000 |
Treasury stock, shares | 1,808,000 | 1,808,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Revenue: | ||||
Revenue | $ 118,262 | $ 89,839 | $ 344,292 | $ 244,923 |
Cost of sales | 38,215 | 30,323 | 129,279 | 80,715 |
Gross profit | 80,047 | 59,516 | 215,013 | 164,208 |
Operating expenses: | ||||
Research and development | 20,000 | 12,111 | 47,831 | 32,429 |
Sales, general and administrative | 91,411 | 75,954 | 269,960 | 218,093 |
Litigation-related expenses | 2,715 | 3,602 | 12,815 | 16,629 |
Amortization of acquired intangible assets | 3,873 | 2,774 | 10,461 | 7,181 |
Transaction-related expenses | 278 | 2,178 | 120 | |
Restructuring expenses | 129 | 45 | 333 | 1,704 |
Total operating expenses | 118,406 | 94,486 | 343,578 | 276,156 |
Operating loss | (38,359) | (34,970) | (128,565) | (111,948) |
Interest expense and other expense, net: | ||||
Interest expense, net | (4,459) | (1,285) | (12,225) | (4,176) |
Other income (expense), net | 47 | (615) | 3,077 | (578) |
Total interest expense and other expense, net | (4,412) | (1,900) | (9,148) | (4,754) |
Net loss before taxes | (42,771) | (36,870) | (137,713) | (116,702) |
Income tax benefit | (117) | (77) | (153) | (192) |
Net loss | $ (42,654) | $ (36,793) | $ (137,560) | $ (116,510) |
Net loss per share, basic | $ (0.35) | $ (0.35) | $ (1.18) | $ (1.14) |
Net loss per share, diluted | $ (0.35) | $ (0.35) | $ (1.18) | $ (1.14) |
Weighted average shares outstanding, basic | 122,468 | 104,804 | 117,026 | 102,561 |
Weighted average shares outstanding, diluted | 122,468 | 104,804 | 117,026 | 102,561 |
Products and Services | ||||
Revenue: | ||||
Revenue | $ 118,262 | $ 89,839 | $ 344,292 | $ 244,908 |
International Supply Agreement | ||||
Revenue: | ||||
Revenue | $ 15 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Statement of Comprehensive Income [Abstract] | ||||||||
Net loss | $ (42,654) | $ (51,377) | $ (43,529) | $ (36,793) | $ (37,101) | $ (42,616) | $ (137,560) | $ (116,510) |
Foreign currency translation adjustments | (2,600) | $ 178 | $ 1,105 | (4,958) | $ (5,388) | $ (1,204) | (1,317) | (11,550) |
Comprehensive loss | $ (45,254) | $ (41,751) | $ (138,877) | $ (128,060) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT (Unaudited) - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional paid-in capital | Treasury stock | Accumulated other comprehensive loss | Accumulated deficit | Public Offering |
Balance at Dec. 31, 2021 | $ 80,674 | $ 10 | $ 892,828 | $ (25,097) | $ (6,036) | $ (781,031) | |
Balance, shares at Dec. 31, 2021 | 99,537 | ||||||
Stock-based compensation | 7,730 | 7,730 | |||||
Sales agent equity incentives | 2,178 | 2,178 | |||||
Sales agent equity incentives, shares | 199 | ||||||
Common stock issued for warrant exercises | 1,289 | 1,289 | |||||
Common stock issued for warrant exercises, shares | 551 | ||||||
Common stock issued for stock option exercises | 140 | 140 | |||||
Common stock issued for stock option exercises, shares | 39 | ||||||
Common stock issued for vesting of restricted stock units, net of shares withheld for tax liability | (4,751) | (4,751) | |||||
Common stock issued for vesting of restricted stock units, net of shares withheld for tax liability, shares | 852 | ||||||
Foreign currency translation adjustments | (1,204) | (1,204) | |||||
Net loss | (42,616) | (42,616) | |||||
Balance at Mar. 31, 2022 | 43,440 | $ 10 | 899,414 | (25,097) | (7,240) | (823,647) | |
Balance, shares at Mar. 31, 2022 | 101,178 | ||||||
Balance at Dec. 31, 2021 | 80,674 | $ 10 | 892,828 | (25,097) | (6,036) | (781,031) | |
Balance, shares at Dec. 31, 2021 | 99,537 | ||||||
Foreign currency translation adjustments | (11,550) | ||||||
Net loss | (116,510) | ||||||
Balance at Sep. 30, 2022 | (20,894) | $ 11 | 919,319 | (25,097) | (17,586) | (897,541) | |
Balance, shares at Sep. 30, 2022 | 104,984 | ||||||
Balance at Mar. 31, 2022 | 43,440 | $ 10 | 899,414 | (25,097) | (7,240) | (823,647) | |
Balance, shares at Mar. 31, 2022 | 101,178 | ||||||
Stock-based compensation | 10,109 | 10,109 | |||||
Sales agent equity incentives | 361 | 361 | |||||
Sales agent equity incentives, shares | 20 | ||||||
Common stock issued for conversion of Series A preferred stock | 29 | ||||||
Common stock issued for warrant exercises | 2,675 | $ 1 | 2,674 | ||||
Common stock issued for warrant exercises, shares | 1,914 | ||||||
Common stock issued for employee stock purchase plan and stock option exercises, shares | 535 | ||||||
Common stock issued for employee stock purchase plan and stock option exercises | 2,331 | 2,331 | |||||
Common stock issued for vesting of restricted stock units, net of shares withheld for tax liability | (4,562) | (4,562) | |||||
Common stock issued for vesting of restricted stock units, net of shares withheld for tax liability, shares | 819 | ||||||
Common stock issued for asset acquisition | 250 | 250 | |||||
Common stock issued for asset acquisition, shares | 23 | ||||||
Foreign currency translation adjustments | (5,388) | (5,388) | |||||
Net loss | (37,101) | (37,101) | |||||
Balance at Jun. 30, 2022 | 12,115 | $ 11 | 910,577 | (25,097) | (12,628) | (860,748) | |
Balance, shares at Jun. 30, 2022 | 104,518 | ||||||
Stock-based compensation | 10,011 | 10,011 | |||||
Sales agent equity incentives | 178 | 178 | |||||
Common stock issued for warrant exercises | 196 | 196 | |||||
Common stock issued for warrant exercises, shares | 49 | ||||||
Common stock issued for employee stock purchase plan and stock option exercises, shares | 11 | ||||||
Common stock issued for employee stock purchase plan and stock option exercises | 47 | 47 | |||||
Common stock issued for vesting of restricted stock units, net of shares withheld for tax liability | (1,690) | (1,690) | |||||
Common stock issued for vesting of restricted stock units, net of shares withheld for tax liability, shares | 406 | ||||||
Foreign currency translation adjustments | (4,958) | (4,958) | |||||
Net loss | (36,793) | (36,793) | |||||
Balance at Sep. 30, 2022 | (20,894) | $ 11 | 919,319 | (25,097) | (17,586) | (897,541) | |
Balance, shares at Sep. 30, 2022 | 104,984 | ||||||
Balance at Dec. 31, 2022 | (34,667) | $ 11 | 933,537 | (25,097) | (10,794) | (932,324) | |
Balance, shares at Dec. 31, 2022 | 106,640 | ||||||
Stock-based compensation | 16,462 | 16,462 | |||||
Common stock issued for warrant exercises | 457 | $ 1 | 456 | ||||
Common stock issued for warrant exercises, shares | 4,443 | ||||||
Common stock issued for stock option exercises | 768 | 768 | |||||
Common stock issued for stock option exercises, shares | 349 | ||||||
Common stock issued for vesting of restricted stock units, net of shares withheld for tax liability | (2,331) | (2,331) | |||||
Common stock issued for vesting of restricted stock units, net of shares withheld for tax liability, shares | 2,027 | ||||||
Reclassification of equity-based liability | 3,373 | 3,373 | |||||
Foreign currency translation adjustments | 1,105 | 1,105 | |||||
Net loss | (43,529) | (43,529) | |||||
Balance at Mar. 31, 2023 | (58,362) | $ 12 | 952,265 | (25,097) | (9,689) | (975,853) | |
Balance, shares at Mar. 31, 2023 | 113,459 | ||||||
Balance at Dec. 31, 2022 | (34,667) | $ 11 | 933,537 | (25,097) | (10,794) | (932,324) | |
Balance, shares at Dec. 31, 2022 | 106,640 | ||||||
Foreign currency translation adjustments | (1,317) | ||||||
Net loss | (137,560) | ||||||
Balance at Sep. 30, 2023 | (44,161) | $ 12 | 1,062,919 | (25,097) | (12,111) | (1,069,884) | |
Balance, shares at Sep. 30, 2023 | 123,311 | ||||||
Balance at Mar. 31, 2023 | (58,362) | $ 12 | 952,265 | (25,097) | (9,689) | (975,853) | |
Balance, shares at Mar. 31, 2023 | 113,459 | ||||||
Stock-based compensation | 24,194 | 24,194 | |||||
Common stock issued for warrant exercises | 172 | $ 172 | |||||
Common stock issued for warrant exercises, shares | 1,121 | ||||||
Common stock issued for employee stock purchase plan and stock option exercises, shares | 274 | 2,277 | |||||
Common stock issued for employee stock purchase plan and stock option exercises | $ 2,277 | ||||||
Common stock issued for vesting of restricted stock units, net of shares withheld for tax liability, shares | (2,934) | 2,711 | (2,934) | ||||
Common stock offering, net of offering costs | $ 57,511 | $ 57,511 | |||||
Common stock offering, net of offering costs, shares | 4,286 | ||||||
Reclassification of equity-based liability | $ 188 | 188 | |||||
Foreign currency translation adjustments | 178 | 178 | |||||
Net loss | (51,377) | (51,377) | |||||
Balance at Jun. 30, 2023 | (28,153) | $ 12 | 1,033,673 | (25,097) | (9,511) | (1,027,230) | |
Balance, shares at Jun. 30, 2023 | 121,851 | ||||||
Stock-based compensation | 20,073 | 20,073 | |||||
Common stock issued for stock option exercises | 38 | 38 | |||||
Common stock issued for stock option exercises, shares | 8 | ||||||
Common stock issued for vesting of restricted stock units, net of shares withheld for tax liability | (782) | (782) | |||||
Common stock issued for vesting of restricted stock units, net of shares withheld for tax liability, shares | 784 | ||||||
Common stock offering, net of offering costs | 9,917 | 9,917 | |||||
Common stock offering, net of offering costs, shares | 668 | ||||||
Foreign currency translation adjustments | (2,600) | (2,600) | |||||
Net loss | (42,654) | (42,654) | |||||
Balance at Sep. 30, 2023 | $ (44,161) | $ 12 | $ 1,062,919 | $ (25,097) | $ (12,111) | $ (1,069,884) | |
Balance, shares at Sep. 30, 2023 | 123,311 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT (Unaudited) (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2023 | Jun. 30, 2023 | |
Common stock, offering costs | $ 307 | $ 2,489 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Operating activities: | ||
Net loss | $ (137,560) | $ (116,510) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 40,120 | 29,819 |
Stock-based compensation | 60,729 | 30,464 |
Amortization of debt discount and debt issuance costs | 2,586 | 1,470 |
Amortization of right-of-use assets | 2,598 | 1,927 |
Write-down for excess and obsolete inventories | 9,188 | 7,023 |
Loss on disposal of assets | 2,209 | 1,739 |
Other | 1,717 | 573 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (4,938) | (10,133) |
Inventories | (36,087) | (20,131) |
Prepaid expenses and other current assets | (6,499) | 19 |
Other assets | (52) | (840) |
Accounts payable | 10,290 | 7,437 |
Accrued expenses | 7,984 | 4,144 |
Lease liabilities | (2,677) | (1,905) |
Contract liabilities | 1,906 | (1,133) |
Other long-term liabilities | (4,995) | (694) |
Net cash used in operating activities | (53,481) | (66,731) |
Investing activities: | ||
Purchase of property and equipment | (54,791) | (35,984) |
Purchase of intangible assets | (3,971) | (7,461) |
Acquisition of business | (55,000) | |
Net cash used in investing activities | (113,762) | (43,445) |
Financing activities: | ||
Proceeds from term loan, net of debt discount | 148,473 | |
Payment of debt issuance costs | (3,321) | (968) |
Proceeds from common stock offering, net of offering costs | 67,428 | |
Net cash paid for common stock exercises | (2,334) | (4,179) |
Proceeds from revolving credit facility | 92,000 | 35,000 |
Repayment of OCEANEs | (13,315) | |
Repayment of revolving credit facility | (82,500) | |
Proceeds from financed insurance | 1,328 | 1,801 |
Other | (2,411) | (1,439) |
Net cash provided by financing activities | 205,348 | 30,215 |
Effect of exchange rate changes on cash | (275) | (1,175) |
Net increase (decrease) in cash and cash equivalents | 37,830 | (81,136) |
Cash and cash equivalents at beginning of period | 84,696 | 187,248 |
Cash and cash equivalents at end of period | 122,526 | 106,112 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | 11,202 | 2,723 |
Cash paid for income taxes | 247 | 272 |
Supplemental disclosure of noncash activities: | ||
Financed insurance | 1,328 | 1,801 |
Debt issuance costs | 347 | |
Purchases of property and equipment in accounts payable and accrued expenses | 7,156 | 2,019 |
Purchase of intangible assets | 171 | 750 |
Recognition of lease liability | $ 424 | 180 |
Modification of lease liability for lease amendment | 4,288 | |
Common stock issued for asset acquisition | $ 250 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Pay vs Performance Disclosure | ||||||||
Net Income (Loss) | $ (42,654) | $ (51,377) | $ (43,529) | $ (36,793) | $ (37,101) | $ (42,616) | $ (137,560) | $ (116,510) |
Insider Trading Arrangements
Insider Trading Arrangements | 9 Months Ended |
Sep. 30, 2023 shares | |
Trading Arrangements, by Individual | |
Material Terms of Trading Arrangement | A written plan entered into by Evan Bakst , a Director of the Company, on May 23, 2023 for the sale of an aggregate 8,700 shares of common stock terminated in accordance with the plan term on September 15, 2023 . The plan was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act. On September 14, 2023 , David P. Sponsel , the Company's Executive Vice President , Sales, entered into a written plan for the sale of up to 104,680 shares of common stock. The number of shares of common stock to potentially be sold pursuant to this written plan will depend on the terms of current unvested equity compensation awards granted to Mr. Sponsel and the Company’s achievement relative to applicable performance measures for such current unvested equity compensation awards. In addition, the actual number of shares that will be released to Mr. Sponsel in connection with these awards and sold under Rule 10b5-1(c) will be net of the number of shares withheld to satisfy tax withholding obligations arising from the vesting of such shares and is not yet determinable. The plan is intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act, and is scheduled to terminate no later than November 29, 2024 . On September 11, 2023 , Craig E. Hunsaker , the Company's Executive Vice President , People and Culture, entered into a written plan for the sale of shares of common stock. The number of shares of common stock to potentially be sold pursuant to this written plan is intended to satisfy tax withholding obligations arising from the vesting of such shares and is not yet determinable. The plan is intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act, and is scheduled to terminate no later than March 28, 2024 . On August 10, 2023 , Scott Lish , the Company's Senior Vice President , Research & Development, modified a written plan for the sale of up to 97,585 shares of common stock. The number of shares of common stock to potentially be sold pursuant to this written plan will depend on the terms of current unvested equity compensation awards granted to Mr. Lish and the Company’s achievement relative to applicable performance measures for such current unvested equity compensation awards. In addition, the actual number of shares that will be released to Mr. Lish in connection with these awards and sold under Rule 10b5-1(c) will be net of the number of shares withheld to satisfy tax withholding obligations arising from the vesting of such shares and is not yet determinable. The plan is intended to satisfy the affirmative defense conditions of Rule 10b5-1 (c) under the Exchange Act, and is scheduled to terminate no later than March 7, 2025 . On August 10, 2023 , Beth Altman , a Director of the Company, terminated a written plan for the sale of an aggregate 12,742 shares of common stock. The plan was intended to satisfy the affirmative defense conditions of Rule 10b5-1 (c) under the Exchange Act. |
Evan Bakst | |
Trading Arrangements, by Individual | |
Name | Evan Bakst |
Title | Director |
Rule 10b5-1 Arrangement Adopted | true |
Adoption Date | May 23, 2023 |
Termination Date | September 15, 2023 |
Aggregate Available | 8,700 |
David P. Sponsel | |
Trading Arrangements, by Individual | |
Name | David P. Sponsel |
Title | Executive Vice President |
Rule 10b5-1 Arrangement Adopted | true |
Adoption Date | September 14, 2023 |
Termination Date | November 29, 2024 |
Aggregate Available | 104,680 |
Craig E. Hunsaker | |
Trading Arrangements, by Individual | |
Name | Craig E. Hunsaker |
Title | Executive Vice President |
Rule 10b5-1 Arrangement Adopted | true |
Adoption Date | September 11, 2023 |
Termination Date | March 28, 2024 |
Scott Lish | |
Trading Arrangements, by Individual | |
Name | Scott Lish |
Title | Senior Vice President |
Rule 10b5-1 Arrangement Adopted | true |
Adoption Date | August 10, 2023 |
Termination Date | March 7, 2025 |
Aggregate Available | 97,585 |
Beth Altman | |
Trading Arrangements, by Individual | |
Name | Beth Altman |
Title | Director |
Rule 10b5-1 Arrangement Adopted | true |
Termination Date | August 10, 2023 |
Aggregate Available | 12,742 |
Organization and Significant Ac
Organization and Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Organization and Significant Accounting Policies | 1. Organization and Significant Accounting Policies The Company Alphatec Holdings, Inc. (the “Company”), through its wholly owned subsidiaries, Alphatec Spine, Inc. (“Alphatec Spine”), SafeOp Surgical, Inc. (“SafeOp”), and EOS imaging S.A.S. (“EOS”), is a medical technology company that designs, develops, and markets technology for the treatment of spinal disorders associated with disease and degeneration, congenital deformities, and trauma. The Company markets its products in the United States of America and internationally via a network of independent sales agents and direct sales representatives. Basis of Presentation and Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. The Company translates the financial statements of its foreign subsidiaries using end-of-period exchange rates for assets and liabilities and average exchange rates during each reporting period for results of operations. All intercompany balances and transactions have been eliminated during consolidation. The accompanying condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Pursuant to these rules and regulations, the Company has condensed or omitted certain information and footnotes it normally includes in its annual consolidated financial statements prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”). The unaudited interim condensed consolidated financial statements reflect all adjustments, including normal recurring adjustments which, in the opinion of management, are necessary for a fair statement of the financial position and results of operations for the periods presented. These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, 2022, which are included in the Company’s Annual Report on Form 10-K that was filed with the SEC. Operating results for the nine months ended September 30, 2023 are not necessarily indicative of the results that may be expected for the year ending December 31, 2023, or any other future periods. Prior-period Adjustment Subsequent to the issuance of the Company’s consolidated financial statements as of and for the year ended December 31, 2022, the Company identified that a deferred tax liability and additional goodwill related to the acquisition of EOS should have been recorded at the time of the acquisition. The Company corrected the errors in the accompanying condensed consolidated financial statements as of the earliest period presented and has concluded that the correction of these errors is not material to the previously issued financial statements. The correction to the accompanying unaudited condensed consolidated balance sheets, condensed consolidated statements of operations, condensed consolidated statements of comprehensive loss, condensed consolidated statements of stockholders' equity, and condensed consolidated statements of cash flows are as follows (in thousands): At December 31, 2021 Condensed Consolidated Statements of Stockholders' Equity As Reported Adjustment As Corrected Accumulated other comprehensive loss $ ( 5,994 ) ( 42 ) $ ( 6,036 ) Accumulated deficit $ ( 782,325 ) 1,294 $ ( 781,031 ) Total stockholders' equity $ 79,422 1,252 $ 80,674 At December 31, 2022 Condensed Consolidated Balance Sheets As Reported Adjustment As Corrected Goodwill $ 39,775 7,592 $ 47,367 Total assets $ 513,376 7,592 $ 520,968 Other long-term liabilities $ 11,543 5,546 $ 17,089 Accumulated other comprehensive loss $ ( 10,690 ) ( 104 ) $ ( 10,794 ) Accumulated deficit $ ( 934,474 ) 2,150 $ ( 932,324 ) Total stockholders' deficit $ ( 36,713 ) 2,046 $ ( 34,667 ) Total liabilities and stockholders' deficit $ 513,376 7,592 $ 520,968 Three Months Ended September 30, 2022 Nine Months Ended September 30, 2022 Condensed Consolidated Statements of Operations As Reported Adjustment As Corrected As Reported Adjustment As Corrected Income tax provision (benefit) $ 129 ( 206 ) $ ( 77 ) $ 461 ( 653 ) $ ( 192 ) Net loss $ ( 36,999 ) 206 $ ( 36,793 ) $ ( 117,163 ) 653 $ ( 116,510 ) Three Months Ended September 30, 2022 Nine Months Ended September 30, 2022 Condensed Consolidated Statements of Comprehensive Loss As Reported Adjustment As Corrected As Reported Adjustment As Corrected Net loss $ ( 36,999 ) 206 $ ( 36,793 ) $ ( 117,163 ) 653 $ ( 116,510 ) Foreign currency translation adjustments $ ( 4,851 ) ( 107 ) $ ( 4,958 ) $ ( 11,320 ) ( 230 ) $ ( 11,550 ) Comprehensive loss $ ( 41,850 ) 99 $ ( 41,751 ) $ ( 128,483 ) 423 $ ( 128,060 ) Three Months Ended March 31, 2022 Three Months Ended June 30, 2022 Three Months Ended September 30, 2022 Condensed Consolidated Statements of Stockholders' Equity (Deficit) As Reported Adjustment As Corrected As Reported Adjustment As Corrected As Reported Adjustment As Corrected Foreign currency translation adjustments $ ( 1,180 ) ( 24 ) $ ( 1,204 ) $ ( 5,289 ) ( 99 ) $ ( 5,388 ) $ ( 4,851 ) ( 107 ) $ ( 4,958 ) Net loss $ ( 42,844 ) 228 $ ( 42,616 ) $ ( 37,320 ) 219 $ ( 37,101 ) $ ( 36,999 ) 206 $ ( 36,793 ) Accumulated other comprehensive loss $ ( 7,174 ) ( 66 ) $ ( 7,240 ) $ ( 12,463 ) ( 165 ) $ ( 12,628 ) $ ( 17,314 ) ( 272 ) $ ( 17,586 ) Accumulated deficit $ ( 825,169 ) 1,522 $ ( 823,647 ) $ ( 862,489 ) 1,741 $ ( 860,748 ) $ ( 899,488 ) 1,947 $ ( 897,541 ) Total stockholders' equity (deficit) $ 41,984 1,456 $ 43,440 $ 10,539 1,576 $ 12,115 $ ( 22,569 ) 1,675 $ ( 20,894 ) Nine Months Ended September 30, 2022 Condensed Consolidated Statements of Cash Flows As Reported Adjustment As Corrected Net loss $ ( 117,163 ) 653 $ ( 116,510 ) Other long-term liabilities $ ( 50 ) ( 644 ) $ ( 694 ) Net cash used for operating activities $ ( 66,740 ) 9 $ ( 66,731 ) Effect of exchange rate changes on cash $ ( 1,166 ) ( 9 ) $ ( 1,175 ) Reclassification Certain financial statement line items in the condensed consolidated financial statements for the nine months ended September 30, 2022 have been aggregated to conform to the current year’s presentation. Use of Estimates The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported amounts of revenues and expenses. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include the useful lives of property and equipment, goodwill, intangible assets, allowances for doubtful accounts, deferred tax assets, inventory, stock-based compensation, revenues, income tax uncertainties, and other contingencies. Fair Value Measurements The carrying amount of financial instruments consisting of cash and cash equivalents, accounts receivable, prepaid expenses and other current assets, accounts payable, accrued expenses, and short-term debt included in the Company’s condensed consolidated financial statements are reasonable estimates of fair value due to their short maturities. Authoritative guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: Level 1: Quoted prices in active markets for identical assets or liabilities. Level 2: Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active; or other inputs that can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Excess and Obsolete Inventory Most of the Company’s inventory is comprised of finished goods, which is primarily produced by third-party suppliers. Specialized implants, fixation products, biologics, and disposables are determined by utilizing a standard cost method that includes capitalized variances which approximates the weighted average cost. Imaging equipment and related parts are valued at weighted average cost. Inventories are stated at the lower of cost or net realizable value. The Company reviews the components of its inventory on a periodic basis for excess and obsolescence and adjusts inventory to its net realizable value as necessary. The Company records a lower of cost or net realizable value (“LCNRV”) inventory reserve for estimated excess and obsolete inventory based upon its expected use of inventory on hand. The Company’s inventory, which consists primarily of specialized implants, fixation products, biologics, and disposables is at risk of obsolescence due to the need to maintain substantial levels of inventory. In order to market its products effectively and meet the demands of interoperative product placement, the Company maintains and provides surgeons and hospitals with a variety of inventory products and sizes. For each surgery, fewer than all components will be consumed. The need to maintain and provide a wide variety of inventory causes inventory to be held that is not likely to be used. The Company’s estimates and assumptions for excess and obsolete inventory are reviewed and updated on a quarterly basis. The estimates and assumptions are determined primarily based on current usage of inventory and the age of inventory quantities on hand. Additionally, the Company considers recent sales experience to develop assumptions about future demand for its products, while considering product life cycles and new product launches. Increases in the LCNRV reserve for excess and obsolete inventory result in a corresponding charge to cost of sales. Revenue Recognition The Company recognizes revenue from product sales in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Revenue from Contracts with Customers (“Topic 606”). This standard applies to all contracts with customers, except for contracts that are within the scope of other standards, such as leases, insurance, collaboration arrangements, and financial instruments. Under Topic 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration that the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of Topic 606, the entity performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. Sales are derived primarily from the sale of spinal implant products, imaging equipment, and related services to hospitals and medical centers through direct sales representatives and independent sales agents. Revenue is recognized when obligations under the terms of a contract with customers are satisfied, which occurs with the transfer of control of products to customers, either upon shipment of the product or delivery of the product to the customer depending on the shipping terms, or when the products are used in a surgical procedure (implanted in a patient). Revenue from the sale of imaging equipment is recognized as each distinct performance obligation is fulfilled and control transfers to the customer, beginning with shipment or delivery, depending on the terms. Revenue from other distinct performance obligations, such as maintenance on imaging equipment and other imaging-related services, is recognized in the period the service is performed, and makes up less than 10 % of the Company’s total revenue. Revenue is measured based on the amount of consideration expected to be received in exchange for the transfer of the goods or services specified in the contract with each customer. In certain cases, the Company does offer the ability for customers to lease its imaging equipment primarily on a non-sales type basis, but such arrangements are immaterial to total revenue in the periods presented. The Company generally does not allow returns of products that have been delivered. Costs incurred by the Company associated with sales contracts with customers are deferred over the performance obligation period and recognized in the same period as the related revenue, except for contracts that complete within one year or less, in which case the associated costs are expensed as incurred. Payment terms for sales to customers may vary but are commensurate with the general business practices in the country of sale. To the extent that the transaction price includes variable consideration, such as discounts, rebates, and customer payment penalties, the Company estimates the amount of variable consideration that should be included in the transaction price utilizing either the expected value method or the most likely amount method depending on the nature of the variable consideration. Variable consideration is included in the transaction price if, in the Company's judgment, it is probable that a significant future reversal of cumulative revenue under the contract will not occur. Estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on an assessment of the Company’s anticipated performance and all information that is reasonably available, including historical, current, and forecasted information. The Company records a contract asset when one or more performance obligations have been completed by the Company and revenue has been recognized, but the customer's payment is contingent on the satisfaction of additional performance obligations. The Company records a contract liability, or deferred revenue, when it has an obligation to provide a product or service to the customer and payment is received in advance of its performance. When the Company sells a product or service with a future performance obligation, revenue is deferred on the unfulfilled performance obligation and recognized over the related performance period. Generally, the Company does not have observable evidence of the standalone selling price related to its future service obligations; therefore, the Company estimates the selling price using an expected cost plus a margin approach. The transaction price is allocated using the relative standalone selling price method. The use of alternative estimates could result in a different amount of revenue deferral. Recently Adopted and Issued Accounting Pronouncements In August 2021, the FASB issued Accounting Standards Update ("ASU") No. 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers . The guidance requires application of Topic 606, Revenue from Contracts with Customers to recognize and measure contract assets and contract liabilities acquired in a business combination. ASU No. 2021-08 adds an exception to the general recognition and measurement principle in Topic 805 where assets acquired and liabilities assumed in a business combination, including contract assets and contract liabilities arising from contracts with customers, are measured at fair value on the acquisition date. Under the new guidance, the acquirer will recognize acquired contract assets and contract liabilities as if the acquirer had originated the contract. The standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022, with early adoption permitted. The Company adopted ASU No. 2021-08 as of January 1, 2023, on a prospective basis. The adoption of ASU No. 2021-08 did not have a material impact on the Company's condensed consolidated financial statements and related disclosures. In October 2023, the FASB issued ASU No. 2023-06, Disclosure Improvements - Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative. The guidance amends the ASC to incorporate certain disclosure requirements from SEC Release No. 33-10532 Disclosure Update and Simplification issued in 2018. The effective date for each amendment will be the date on which the SEC’s removal of that related disclosure from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited. ASU No. 2023-06 is not expected to have a material impact on the Company's financial statements. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 2. Fair Value Measurements Assets and liabilities measured at fair value on a recurring basis include the following as of September 30, 2023, and December 31, 2022 (in thousands): September 30, 2023 Level 1 Level 2 Level 3 Total Cash equivalents: Money market funds $ 62,949 — — $ 62,949 Total cash equivalents $ 62,949 — — $ 62,949 December 31, 2022 Level 1 Level 2 Level 3 Total Cash equivalents: Money market funds $ 62,956 — — $ 62,956 Total cash equivalents $ 62,956 — — $ 62,956 The Company did not have any transfers of assets and liabilities between the levels of the fair value measurement hierarchy during the periods presented. Fair Value of Long-term Debt The fair value, based on a quoted market price (Level 1), of the Company’s outstanding Senior Convertible Notes due 2026 (the "2026 Notes") was approximately $ 304.6 million at September 30, 2023 and approximately $ 288.8 million at December 31, 2022 . |
Business Combination
Business Combination | 9 Months Ended |
Sep. 30, 2023 | |
Business Combinations [Abstract] | |
Business Combination | 3. Business Combination The Company recognizes assets acquired, liabilities assumed, and any noncontrolling interest at fair value at the date of acquisition. On April 19, 2023, the Company entered into an Asset Purchase Agreement with Integrity Implants Inc. and Fusion Robotics, LLC (collectively, the “Sellers”), whereby the Company acquired certain assets, liabilities, employees, and contracts in connection with the Sellers’ navigation-enabled robotics platform (the “Navigation-enabled Robotics Platform”). The Company paid the Sellers cash consideration of $ 55.0 million at closing, which represented the total purchase consideration. The acquisition was accounted for as a business combination in accordance with ASC 805 and the Company did not acquire any material assets or assume any material liabilities in connection with the acquisition, excluding intangible assets and goodwill. The acquisition is treated as an asset purchase for income tax purposes; therefore the goodwill recorded is considered deductible for income tax purposes. Refer to Note 6 for further details on intangible assets and goodwill acquired. The Company is in the process of finalizing the purchase price allocation. While the Company does not expect material changes in the valuation outcome, certain assumptions and findings that were in place at the date of acquisition could result in changes in the purchase price allocation. |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2023 | |
Inventory Disclosure [Abstract] | |
Inventories | 4. Inventories Inventories reported at the lower of cost or net realizable value consist of the following (in thousands): September 30, December 31, Raw materials $ 21,449 $ 13,928 Work-in-process 4,680 3,032 Finished goods 104,543 84,561 Inventories $ 130,672 $ 101,521 |
Property and Equipment, net
Property and Equipment, net | 9 Months Ended |
Sep. 30, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, net | 5. Property and Equipment, net Property and equipment, net consist of the following (in thousands, except as indicated): Useful lives September 30, December 31, Surgical instruments 4 $ 206,748 $ 158,906 Machinery and equipment 7 11,421 9,502 Computer equipment 3 5,388 4,753 Office furniture and equipment 5 5,547 4,760 Leasehold improvements various 3,797 2,965 Construction in progress n/a 20,280 15,360 253,181 196,246 Less: accumulated depreciation ( 119,396 ) ( 94,294 ) Property and equipment, net $ 133,785 $ 101,952 Total depreciation expense was $ 10.7 million and $ 29.0 million for the three and nine months ended September 30, 2023 , respectively. Total depreciation expense was $ 8.0 million and $ 22.6 million for the three and nine months ended September 30, 2022 , respectively. Construction in progress includes costs associated with internal-use software. Construction in progress is not depreciated until placed in service. Property and equipment includes assets under financing leases and the related amortization of assets under financing leases is included in depreciation expense. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 9 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | 6. Goodwill and Intangible Assets Goodwill The change in the carrying amount of goodwill during the period ended September 30, 2023 includes the following (in thousands): December 31, 2022 $ 47,367 Additions 24,582 Foreign currency fluctuation ( 394 ) September 30, 2023 $ 71,555 Intangible assets, net Intangible assets, net consist of the following (in thousands, except as indicated): Remaining Avg. Gross Accumulated Intangible September 30, 2023: (in years) Amount Amortization Assets, net Developed product technology 6 $ 102,211 $ ( 22,512 ) $ 79,699 Trademarks and trade names 7 5,359 ( 1,370 ) 3,989 Customer relationships 3 14,141 ( 8,150 ) 5,991 Distribution network 1 2,413 ( 2,192 ) 221 Total amortized intangible assets 124,124 ( 34,224 ) 89,900 Software in development n/a 5,659 5,659 In-process research and development n/a 6,637 6,637 Total intangible assets $ 136,420 $ ( 34,224 ) $ 102,196 . Remaining Avg. Gross Accumulated Intangible December 31, 2022: (in years) Amount Amortization Assets, net Developed product technology 7 $ 75,896 $ ( 13,420 ) $ 62,476 Trademarks and trade names 8 5,421 ( 987 ) 4,434 Customer relationships 4 14,240 ( 6,906 ) 7,334 Distribution network 2 2,413 ( 2,041 ) 372 Total amortized intangible assets 97,970 ( 23,354 ) 74,616 Software in development n/a 2,503 2,503 In-process research and development n/a 5,662 5,662 Total intangible assets $ 106,135 $ ( 23,354 ) $ 82,781 During the nine months ended September 30, 2023 , in connection with the Company's acquisition of the Robotic-enabled Navigation Platform, as further described in Note 3, the Company recorded additions to definite-lived intangible assets and goodwill in the amount of $ 26.9 million and $ 24.6 million, respectively. The intangible asset acquired will be amortized on a straight-line basis over a useful life of seven years . Total amortization expense attributed to intangible assets was $ 4.1 million and $ 11.1 million for the three and nine months ended September 30, 2023 , respectively. Total amortization expense attributed to intangible assets was $ 2.8 million and $ 7.2 million for the three and nine months ended September 30, 2022, respectively. Software in development is amortized when the projects are completed and the assets are ready for their intended use. In-process research and development assets begin amortizing when the relevant products reach full commercial launch. Future amortization expense related to intangible assets is as follows (in thousands): Remainder of 2023 $ 5,691 2024 16,064 2025 14,575 2026 14,575 2027 12,703 Thereafter 26,292 $ 89,900 |
Contract Assets and Contract Li
Contract Assets and Contract Liabilities | 9 Months Ended |
Sep. 30, 2023 | |
Contract with Customer, Contract Asset, Contract Liability, and Receivable [Abstract] | |
Contract Assets and Contract Liabilities | 7. Contract Assets and Contract Liabilities Contract assets are included within prepaid expenses and other current assets in the condensed consolidated balance sheets. Contract assets relate to contracts with customers for which one or more performance obligations have been completed and revenue has been recognized, but the customer's payment is contingent on the satisfaction of additional performance obligations. The opening and closing balances of the Company's contract assets are as follows (in thousands): September 30, December 31, Contract assets $ 1,868 $ — The Company's current and non-current contract liabilities are $ 13.8 million and $ 3.5 million, respectively, as of September 30, 2023 . The Company's current and non-current contract liabilities were $ 12.0 million and $ 3.0 million, respectively, as of December 31, 2022. The non-current contract liabilities balance is included in other long-term liabilities on the condensed consolidated balance sheets. Contract liabilities relates to contracts with customers for which partial or complete payment of the transaction price has been received from the customer and the related obligations must be completed before revenue can be recognized. These amounts primarily relate to undelivered equipment, services, or maintenance agreements. The Company recognized $ 5.9 million and $ 17.0 million of revenue from its contract liabilities during the three and nine months ended September 30, 2023 , respectively, of which $ 2.4 million and $ 9.3 million was recognized from the opening contract liabilities balance, respectively. The Company recognized $ 6.4 million and $ 16.5 million of revenue from its contract liabilities during the three and nine months ended September 30, 2022 , respectively, of which $ 3.4 million and $ 10.3 million was recognized from the opening contract liabilities balance, respectively. The opening and closing balances of the Company’s contract liabilities are as follows (in thousands): Balance at December 31, 2022 $ 15,003 Payments received 19,367 Revenue recognized ( 16,998 ) Foreign currency fluctuation ( 67 ) Balance at September 30, 2023 $ 17,305 |
Debt
Debt | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Debt | 8. Debt Term Loan On January 6, 2023, the Company entered into a $ 150.0 million term loan credit facility with Braidwell Transaction Holdings, LLC (the “Braidwell Term Loan”). The Braidwell Term Loan provides for an initial term loan of $ 100.0 million which was funded on the closing date. On September 28, 2023, the Company drew an additional $ 50.0 million (the “delayed draw term loan(s)” or the “DDTL”). The Braidwell Term Loan matures on January 6, 2028 . As of September 30, 2023, the outstanding balance under the Braidwell Term Loan was $ 150.0 million. In conjunction with the issuance of the Braidwell Term Loan, the Company incurred $ 3.4 million in debt issuance costs and $ 1.5 million in commitment fees. Commitment fees paid to the lender were accounted for as a debt discount. The debt issuance costs and debt discount were recorded as a direct reduction of the carrying amount of the loan on the condensed consolidated balance sheets and are being amortized over the life of the loan. As of September 30, 2023 , debt issuance costs and debt discount, net of accumulated amortization, associated with the Braidwell Term Loan were $ 3.1 million and $ 1.4 million, respectively. Borrowings under the Braidwell Term Loan bear interest at a rate per annum equal to the Term Secured Overnight Financing Rate for such SOFR business day ("SOFR") subject to a 3 % floor, plus 5.75 %. The applicable interest rate as of September 30, 2023 was 11.2 % . The loan agreement includes an undrawn commitment fee, which is calculated as 1 % per annum of the average daily undrawn portion of the DDTL. Interest and undrawn commitment fees incurred are due quarterly. The Company is also required to pay fees on any prepayment of the Braidwell Term Loan, ranging from 3.0 % to 1.0 % depending on the date of prepayment, and a final payment fee equal to 3.25 % of the principal amount of the loans drawn. The effective interest rate as of September 30, 2023 was 12.2 %. During the three months ended September 30, 2023 , the Company recognized interest expense on the Braidwell Term Loan of $ 3.1 million, which includes $ 0.1 m illion for the amortization of debt issuance costs and $ 0.1 million for the debt discount. During the nine months ended September 30, 2023 , the Company recognized interest expense on the Braidwell Term Loan of $ 8.8 million, which includes $ 0.3 million for the amortization of debt issuance costs and $ 0.2 million for the debt discount. Upon the Braidwell Term Loan’s maturity, any outstanding principal balance, unpaid accrued interest, and all other obligations under the Braidwell Term Loan will be due and payable. The Braidwell Term Loan is secured by substantially all of the Company’s assets with the priority interest of the lenders in the Braidwell Term Loan and the Revolving Credit Facility, as defined below, subject to terms of a customary intercreditor agreement, which provides that the lenders under the Revolving Credit Facility have a priority with respect to the Company's accounts receivable, inventory, medical instruments, and items related to the foregoing, and the lenders under the Braidwell Term Loan have priority with respect to the remainder of the Company's assets. The loan agreement contains customary representations and warranties and affirmative and negative covenants. Under the loan agreement, the Company is required to maintain a minimum level of liquidity. The loan agreement also includes certain events of default, and upon the occurrence of such events of default, all outstanding loans under the Braidwell Term Loan may be accelerated and/or the lenders’ commitments terminated. The Company is in compliance with all required financial covenants as of September 30, 2023. Revolving Credit Facility In September 2022, the Company entered into a revolving credit facility (the “Revolving Credit Facility”) with entities affiliated with MidCap Financial Trust (“MidCap”). The Revolving Credit Facility provides up to $ 50.0 million in borrowing capacity to the Company based on a borrowing base. The borrowing base is calculated based on certain accounts receivable and inventory assets. The Company may request a $ 25.0 million increase in the Revolving Credit Facility for a total commitment of up to $ 75.0 million. The Revolving Credit Facility matures on the earlier of September 29, 2027 , or 90 days prior to the final maturity date of the Company’s 2026 Notes. As of September 30, 2023 , the outstanding balance under the Revolving Credit Facility was $ 46.0 million. In conjunction with obtaining the Revolving Credit Facility, the Company incurred $ 1.4 million in debt issuance costs. These costs were capitalized to other assets on the condensed consolidated balance sheets and are being amortized over the life of the Revolving Credit Facility. As of September 30, 2023, debt issuance costs, net of accumulated amortization, associated with the Revolving Credit Facility were $ 1.1 million. The outstanding loans under the Revolving Credit Facility bear interest at the sum of Term SOFR plus 3.5 % per annum. The applicable interest rate as of September 30, 2023 was 8.9 %. The loan agreements include an unused line fee, which is calculated as 0.5 % per annum of either the unused Revolving Credit Facility or a minimum balance. Interest and unused line fees incurred are due and capitalized to the outstanding principal balance monthly. The Company recognized interest expense on the Revolving Credit Facility of $ 0.6 million and $ 1.5 million, which includes approximately $ 0.1 million and $ 0.2 million for the amortization of debt issuance costs, during the three and nine months ended September 30, 2023, respectively. Upon the Revolving Credit Facility’s maturity, any outstanding principal balance, unpaid accrued interest, and all other obligations under the Revolving Credit Facility will be due and payable. The Revolving Credit Facility contains a lockbox arrangement clause requiring the Company to maintain a lockbox bank account. If the revolving loan availability is less than 30 % of the revolving loan limit for five consecutive business days, or the Company is in default, MidCap will apply funds collected from the Company's lockbox account to reduce the outstanding balance of the Revolving Credit Facility. As of September 30, 2023, the Company's loan availability level has not activated lockbox deductions, nor is it expected to for the next 12 months; therefore, the Company has determined that the outstanding balance under the Revolving Credit Facility is long-term debt on the condensed consolidated balance sheets. The Revolving Credit Facility is secured by substantially all of the Company’s assets with the priority interest of the lenders subject to terms of a customary intercreditor agreement in connection with the Braidwell Term Loan, as described above. The loan agreements and other ancillary documents contain customary representations and warranties and affirmative and negative covenants. Under the loan agreements, the Company is required to maintain a minimum level of liquidity. The loan agreements also include certain events of default, and upon the occurrence of such events of default, all outstanding loans under the Revolving Credit Facility may be accelerated and/or the lenders’ commitments terminated. The Company is in compliance with all required financial covenants as of September 30, 2023. 0.75% Convertible Senior Notes due 2026 In August 2021, the Company issued $ 316.3 million aggregate principal amount of unsecured 2026 Notes with a stated interest rate of 0.75 % and a maturity date of August 1, 2026 . Interest on the 2026 Notes is payable semi-annually in arrears on February 1 and August 1 of each year, beginning on February 1, 2022 . The net proceeds from the sale of the 2026 Notes were approximately $ 306.2 million after deducting the initial purchasers’ offering expenses and before cash used for the privately negotiated capped call transactions (the “Capped Call Transactions”), as described below, the repurchase of stock, and the repayment of the outstanding term loan with Squadron Medical Finance Solutions, LLC, and outstanding obligations under an inventory financing agreement. The 2026 Notes do not contain any financial covenants. The 2026 Notes are convertible into shares of the Company’s common stock based upon an initial conversion rate of 54.5316 shares of the Company’s common stock per $ 1,000 principal amount of 2026 Notes (equivalent to an initial conversion price of approximately $ 18.34 per share). The conversion rate will be subject to adjustment upon the occurrence of certain specified events, including certain distributions and dividends to all or substantially all of the holders of the Company’s common stock. Based on the terms of the 2026 Notes, when a conversion notice is received, the Company has the option to pay or deliver cash, shares of the Company’s common stock, or a combination thereof. Holders of the 2026 Notes have the right to convert their notes in certain circumstances and during specified periods. Prior to the close of business on the business day immediately preceding February 2, 2026, holders may convert all or a portion of their 2026 Notes only under the following circumstances: (1) during any calendar quarter (and only during such calendar quarter) if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130 % of the conversion price on each applicable trading day; (2) during the 5 consecutive business days immediately after any 10 consecutive trading day period (the “measurement period”) in which the trading price per $ 1,000 principal amount of 2026 Notes for each trading day of the measurement period was less than 98 % of the product of the last reported sale price of the Company’s common stock and the conversion rate on each such trading day; or (3) upon the occurrence of specified corporate events. From and after February 2, 2026 , holders of the 2026 Notes may convert their notes at any time at their election until the close of business on the second scheduled trading day immediately before the maturity date. As of September 30, 2023, none of the conditions permitting the holders of the 2026 Notes to convert have been met. The 2026 Notes are classified as long-term debt on the condensed consolidated balances sheet as of September 30, 2023. The 2026 Notes are redeemable, in whole or in part, at the Company’s option at any time, and from time to time, on or after August 6, 2024 and on or before the 40th scheduled trading day immediately before the maturity date, at a cash redemption price equal to the principal amount of the 2026 Notes to be redeemed, plus accrued and unpaid interest, if any, but only if the last reported sale price per share of the Company’s common stock exceeds 130 % of the conversion price for a specified period of time. In addition, calling any of the 2026 Notes for redemption will constitute a “make-whole fundamental change” with respect to the redeemable note, in which case the conversion rate applicable to the conversion of the redeemed note will be increased in certain circumstances if such note is converted after it is called for redemption. If a fundamental change occurs prior to the maturity date, holders may require the Company to repurchase all or a portion of their 2026 Notes for cash at a price equal to 100 % of the principal amount of the 2026 Notes plus accrued and unpaid interest. No principal payments are otherwise due on the 2026 Notes prior to maturity. The Company recorded the full principal amount of the 2026 Notes as a long-term liability net of deferred issuance costs. The annual effective interest rate for the 2026 Notes is 1.4 %. The Company recognized interest expense on the 2026 Notes of $ 1.1 million and $ 3.3 million, which includes $ 0.5 million and $ 1.5 million for the amortization of debt issuance costs, during the three and nine months ended September 30, 2023 , respectively. The Company recognized interest expense on the 2026 Notes of $ 1.1 million and $ 3.3 million, which includes $ 0.5 million and $ 1.5 million for the amortization of debt issuance costs, during the three and nine months ended September 30, 2022, respectively. The Company uses the if-converted method for assumed conversion of the 2026 Notes to compute the weighted-average shares of common stock outstanding for diluted earnings per share, if applicable. The outstanding principal amount and carrying value of the 2026 Notes consists of the following (in thousands): September 30, December 31, Principal $ 316,250 $ 316,250 Unamortized debt issuance costs ( 5,799 ) ( 7,290 ) Net carrying value $ 310,451 $ 308,960 Capped Call Transactions In connection with the offering of the 2026 Notes, the Company entered into the Capped Call Transactions with certain financial institutions. The Capped Call Transactions are expected generally to reduce the potential dilution and/or offset the cash payments the Company is required to make in excess of the principal amount of the 2026 Notes upon conversion of the 2026 Notes in the event that the market price per share of the Company’s common stock is greater than the strike price of the Capped Call Transactions with such reduction and/or offset subject to a cap. The Capped Call Transactions have an initial cap price of $ 27.68 per share of the Company’s common stock, which represents a premium of 100 % over the last reported sale price of the Company’s common stock on August 5, 2021, and is subject to certain adjustments under the terms of the Capped Call Transactions. Collectively, the Capped Call Transactions cover, initially, the number of shares of the Company’s common stock underlying the 2026 Notes, subject to anti-dilution adjustments substantially similar to those applicable to the 2026 Notes. The cost of the Capped Call Transactions was approximately $ 39.9 million. The Capped Call Transactions are separate transactions and are not part of the terms of the 2026 Notes and will not affect any holder’s rights under the notes. Holders of the 2026 Notes will not have any rights with respect to the Capped Call Transactions. OCEANE Convertible Bonds On May 31, 2018, EOS issued 4,344,651 OCEANEs denominated in Euros, due May 2023 for aggregate gross proceeds of $ 34.3 million (€ 29.5 million). The OCEANEs were unsecured obligations of EOS, ranked equally with all other unsecured and unsubordinated obligations of EOS, and paid interest at a rate equal to 6 % per year, payable semiannually in arrears on May 31 and November 30 of each year, beginning November 30, 2018 . The OCEANEs matured on May 31, 2023 . The outstanding OCEANEs and accrued interest were paid in full on May 31, 2023. As of September 30, 2023 , no OCEANEs remained outstanding. Interest expense was $ 0.3 million for the nine months ended September 30, 2023. Interest expense w as $ 0.2 million and $ 0.6 million for the three and nine months ended September 30, 2022, respectively. Other Debt Agreements In January and April 2021, prior to the acquisition, EOS obtained two loan agreements, denominated in Euros, under French government sponsored COVID-19 relief initiatives (pret garanti par l’etat or “PGE” loans). Each PGE loan contains a 12 -month term and 90 % of the principal balance of each loan is state guaranteed. The cost of the state guaranty is 0.25 % of the loan amounts. The loans carry an interest-free rate from the commercial banks (€ 3.3 million) and a 1.75 % interest rate from the lender (€ 1.5 million). The loan capital and loan guaranty costs are payable in full at the end of the 12-month term or the loan may be extended up to 5 additional years. If the Company chooses to extend the debt, the election must be made by the Company between months 8 and 11 of the 12-month term. The extension will carry an interest rate at the banks’ refinancing cost, to be applied from year 2 to year 6 and an increased state guaranty cost (50 to 200 bps, as per a scale with company size and extension year). In February 2022, the Company extended the maturity for each loan agreement to 2027 . Each loan has a 12 -month period from the applicable extension date where interest only payments will occur (the “Interest Only Period”). Following the Interest Only Period, monthly and quarterly installments of principal and interest under each loan agreement will be due until the original principal amounts and applicable interest is fully repaid in 2027. The outstanding obligation under each loan as of September 30, 2023 was $ 3.2 million and $ 1.4 million (€ 3.0 million and € 1.4 million) at weighted average interest rates of 0.98 % and 1.25 %, respectively, and weighted average costs of the state guaranty of 0.69 % and 1.00 %, respectively. Total Indebtedness Principal payments remaining on the Company's debt are as follows as of September 30, 2023 (in thousands): Remainder of 2023 $ 676 2024 1,466 2025 1,678 2026 317,748 2027 46,629 Thereafter 154,875 Total 523,072 Less: unamortized debt discount and debt issuance costs ( 14,693 ) Total 508,379 Less: current portion of long-term debt ( 1,766 ) Long-term debt $ 506,613 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 9. Commitments and Contingencies Leases The Company determines if an arrangement is a lease at inception by assessing whether there is an identified asset and whether the contract conveys the right to control the use of the identified asset in exchange for consideration over a period of time. If both criteria are met, the Company records the associated lease liability and corresponding right-of-use asset (“ROU asset”) upon commencement of the lease using a discount rate based on the incremental borrowing rate of interest that the Company would borrow on a collateralized basis for an amount equal to the lease payments in a similar economic environment. Any short-term leases defined as twelve months or less or month-to-month leases are excluded and are expensed each month. Total costs associated with these short-term leases are immaterial to all periods presented. The Company leases office and storage facilities and equipment under various operating and financing lease agreements. The initial terms of these leases range from 1 to 10 years and generally provide for periodic rent increases. The Company’s lease agreements do not contain any material variable lease payments, residual value guarantees or material restrictive covenants. The Company aggregates all lease and non-lease components for each class of underlying assets into a single lease component and variable charges for common area maintenance and other variable costs are recognized as expense as incurred. Total variable costs associated with leases for the three and nine months ended September 30, 2023 were immaterial. The Company had an immaterial amount of financing leases as of September 30, 2023, which is included in property and equipment, net, accrued expenses and other current liabilities, and other long-term liabilities, on the condensed consolidated balance sheets. The Company occupies 121,541 square feet of office space as its headquarters in Carlsbad, California. On December 4, 2019, the Company entered into a 10 -year operating lease that commenced on February 1, 2021 and will terminate on January 31, 2031 , subject to two sixty-month options to renew which are not reasonably certain to be exercised. Base rent under the building lease increases annually by 3 % throughout the remainder of the lease. On May 11, 2022, the Company entered into a lease amendment for the buildout of additional space within the building which resulted in a lease modification increasing the ROU asset and lease liability. Future minimum annual lease payments for all operating leases of the Company are as follows as of September 30, 2023 (in thousands): Remainder of 2023 $ 1,348 2024 5,455 2025 5,209 2026 5,152 2027 5,144 Thereafter 13,080 Total undiscounted lease payments 35,388 Less: imputed interest ( 5,802 ) Operating lease liabilities 29,586 Less: current portion of operating lease liabilities ( 5,090 ) Operating lease liabilities, less current portion $ 24,496 The Company’s weighted average remaining lease term and weighted average discount rate as of September 30, 2023 and December 31, 2022 are as follows: September 30, December 31, Weighted-average remaining lease term (years) 6.8 7.7 Weighted-average discount rate 5.5 % 5.5 % Information related to the Company’s operating leases is as follows (in thousands): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Rent expense $ 1,597 $ 1,210 $ 4,156 $ 3,457 Cash paid for amounts included in measurement of lease liabilities $ 1,317 $ 1,032 $ 3,767 $ 3,183 Purchase Commitments The Company is obligated to meet certain minimum purchase commitment requirements with a third-party supplier through December 2026. As of September 30, 2023, the remaining minimum purchase commitment required by the Company under the agreement is $ 14.3 million. Litigation The Company is and may become involved in various legal proceedings arising from its business activities. While management is not aware of any litigation matter that in and of itself would have a material adverse impact on the Company’s condensed consolidated results of operations, cash flows or financial position, litigation is inherently unpredictable, and depending on the nature and timing of a proceeding, an unfavorable resolution could materially affect the Company’s future consolidated results of operations, cash flows or financial position in a particular period. The Company assesses contingencies to determine the degree of probability and range of possible loss for potential accrual or disclosure in the Company’s condensed consolidated financial statements. An estimated loss contingency is accrued in the Company’s condensed consolidated financial statements if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Because litigation is inherently unpredictable and unfavorable resolutions could occur, assessing contingencies is highly subjective and requires judgments about future events. When evaluating contingencies, the Company may be unable to provide a meaningful estimate due to a number of factors, including the procedural status of the matter in question, the presence of complex or novel legal theories, and/or the ongoing discovery and development of information important to the matters. In addition, damage amounts claimed in litigation against the Company may be unsupported, exaggerated or unrelated to reasonably possible outcomes, and as such are not meaningful indicators of the Company’s potential liability. Indemnifications In the normal course of business, the Company enters into agreements under which it occasionally indemnifies third-parties for intellectual property infringement claims or claims arising from breaches of representations or warranties. In addition, from time to time, the Company provides indemnity protection to third-parties for claims relating to past performance arising from undisclosed liabilities, product liabilities, environmental obligations, representations and warranties, and other claims. In these agreements, the scope and amount of remedy, or the period in which claims can be made, may be limited. It is not possible to determine the maximum potential amount of future payments, if any, due under these indemnities due to the conditional nature of the obligations and the unique facts and circumstances involved in each agreement. In October 2017, NuVasive filed a lawsuit in Delaware Chancery Court against Mr. Miles, the Company’s Chairman and CEO, who was a former officer and board member of NuVasive. The Company itself was not initially a named defendant in this lawsuit; however, in June 2018, NuVasive amended its complaint to add the Company as a defendant. In October 2018, the Delaware Court ordered that NuVasive advance legal fees for Mr. Miles’ defense in the lawsuit, as well as Mr. Miles’ legal fees incurred in pursuing advancement of his fees, pursuant to an indemnification agreement between NuVasive and Mr. Miles. As of September 30, 2023, the Company has not recorded any liability on the condensed consolidated balance sheet related to this matter. Royalties The Company has entered into various intellectual property agreements requiring the payment of royalties based on the sale of products that utilize such intellectual property. These royalties primarily relate to products sold by Alphatec Spine and are based on fixed fees or calculated either as a percentage of net sales or on a per-unit sold basis. Royalties are included on the accompanying condensed consolidated statements of operations as a component of cost of sales. |
Stock-Benefit Plans and Equity
Stock-Benefit Plans and Equity Transactions | 9 Months Ended |
Sep. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Benefit Plans and Equity Transactions | 10. Stock-Benefit Plans and Equity Transactions Stock-Based Compensation The Company has stock-based compensation plans under which it grants stock options, restricted stock units ("RSUs"), and performance restricted stock units ("PRSUs") to officers, directors and third parties. Total stock-based compensation for the periods presented are as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2023 2022 2023 2022 Cost of sales $ 2,369 $ 735 $ 24,601 $ 1,440 Research and development 6,790 1,653 9,587 3,987 Sales, general and administrative 10,914 8,689 26,541 25,037 Total $ 20,073 $ 11,077 $ 60,729 $ 30,464 As of September 30, 2023 , there was $ 70.5 million of unrecognized compensation expense for RSUs and PRSUs to be recognized over a weighted average period of 1.69 years. The Company has entered into Development Service Agreements for the development of a wide variety of potential products and intellectual property. Under these agreements, future royalty payments for product and/or intellectual property rights may be paid in either cash or restricted shares of the Company’s common stock at the election of the developer, depending on the terms of the agreement. Certain of these agreements were amended to remove the cash royalty option and require settlement in restricted shares of the Company’s common stock. During the three and nine months ended September 30, 2023, the vesting conditions of certain of these awards were deemed probable. Stock-based compensation associated with these awards is included in cost of sales and research and development on the condensed consolidated statements of operations. Restricted Stock Units and Performance Based Restricted Stock Units Awards The Company issued approximately 789,000 and 5,714,000 shares of common stock, before net share settlement, upon vesting of RSUs and PRSUs during the three and nine months ended September 30, 2023, respectively. The Company issued approximately 563,000 and 3,103,000 shares of common stock, before net share settlement, upon vesting of RSUs and PRSUs during the three and nine months ended September 30, 2022, respectively. Employee Stock Purchase Plan Employees are eligible to participate in the Employee Stock Purchase Plan ("ESPP") approved by its shareholders. During the three months ended September 30, 2023, there were no shares issued under the ESPP. During the nine months ended September 30, 2023, there were approximately 247,000 shares issued under the ESPP. During the three months ended September 30, 2022, there were no shares issued under the ESPP. During the nine months ended September 30, 2022, there were approximately 222,000 shares issued under the ESPP. The Company estimates the fair value of shares issued to employees under the ESPP using the Black-Scholes option-pricing model. The assumptions used to estimate the fair value of stock options granted and stock purchase rights under the ESPP are as follows: Three and Nine Months Ended September 30, 2023 2022 Risk-free interest rate 4.54 % - 5.41 % 0.07 % - 1.54 % Expected dividend yield — — Expected term (years) 0.41 - 0.60 0.50 Volatility 40.87 % - 62.77 % 50.29 % - 64.53 % At the Market Offering On August 11, 2023, the Company completed an at the market offering of 668,484 shares of the Company’s common stock, $ 0.0001 par value per share, pursuant to the sales agreement between the Company and Cowen and Company, LLC. The net proceeds from the offering were approximately $ 9.9 million, including the underwriting discounts and commissions and offering expenses paid by the Company. Registered Securities Offering On April 19, 2023, the Company completed a registered securities offering (the “Offering”) of 4,285,715 shares of the Company’s common stock, $ 0.0001 par value per share, pursuant to the Underwriting Agreement between the Company and Cowen and Company, LLC, at a price of $ 14.00 per share. The net proceeds from the Offering were approximately $ 57.5 million, including the underwriting discounts and commissions and offering expenses paid by the Company. Warrants Outstanding 2018 PIPE Warrants The 2018 common stock warrants (the “2018 PIPE Warrants”) had a five-year life and were exercisable by cash or cashless exercise. T he 2018 PIPE Warrants expired in May 2023, and no 2018 PIPE warrants remained outstanding as of September 30, 2023. During the nine months ended September 30, 2023, there were approximately 6,311,000 2018 PIPE Warrant exercises for total cash proceeds of $ 0.4 million. During the three months ended September 30, 2022, there were approximately 14,000 2018 PIPE Warrant cashless exercises. During the nine months ended September 30, 2022, there were approximately 140,000 2018 PIPE Warrant exercises for total cash proceeds of $ 0.4 million. SafeOp Surgical Merger Warrants The SafeOp common stock warrants (the “SafeOp Warrants”), had a five-year life and were exercisable by cash or cashless exercise . T he SafeOp Warrants expired in May 2023, and no SafeOp warrants remained outstanding as of September 30, 2023. During the nine months ended September 30, 2023, there were 937,000 cashless SafeOp Warrant exercises. During the three months ended September 30, 2022, there were no SafeOp Warrant exercises. During the nine months ended September 30, 2022, there were approximately 257,000 SafeOp Warrant cashless exercises. Squadron Medical Warrants In connection with debt financing entered into with Squadron Medical in 2018, and amended in 2019 and 2020, the Company issued common stock warrants to Squadron Medical and a participant lender (the “Squadron Medical Warrants”). The Squadron Medical Warrants expire in May 2027 and are exercisable by cash exercise. No Squadron Medical Warrants have been exercised as of September 30, 2023. Executive Warrants The Company issued warrants to Mr. Patrick S. Miles, the Company’s Chairman and Chief Executive Officer (the “Executive Warrants”). The Executive Warrants had a five-year term and are exercisable by cash or cashless exercise. In October 2022, the term was extended to seven years . No Executive Warrants have been exercised as of September 30, 2023. A summary of all outstanding warrants for common stock as of September 30, 2023, are as follows (in thousands, except for strike price data): Number of Strike Price Expiration 2018 Squadron Medical Warrants 845 $ 3.15 May 2027 2019 Squadron Medical Warrants 4,839 $ 2.17 May 2027 2020 Squadron Medical Warrants 1,076 $ 4.88 May 2027 Executive Warrants 1,327 $ 5.00 December 2024 Other (1) 139 $ 7.41 Various through February 2026 Total 8,226 (1) Weighted-average strike price. All outstanding warrants were deemed to qualify for equity classification under authoritative accounting guidance. |
Business Segment and Geographic
Business Segment and Geographic Information | 9 Months Ended |
Sep. 30, 2023 | |
Segment Reporting [Abstract] | |
Business Segment and Geographic Information | 11. Business Segment and Geographic Information The Company operates in one segment based upon the Company’s organizational structure, the way in which the operations and investments are managed and evaluated by the chief operating decision maker (“CODM”) as well as the lack of available discrete financial information at a level lower than the consolidated level. The Company shares common, centralized support functions which report directly to the CODM and decision-making regarding the Company’s overall operating performance and allocation of Company resources is assessed on a consolidated basis. Net revenue and property and equipment, net, by geographic region are as follows (in thousands): Revenue Property and equipment, net Three Months Ended Nine Months Ended September 30, December 31, (in thousands) 2023 2022 2023 2022 2023 2022 United States $ 110,096 $ 84,801 $ 317,728 $ 229,720 $ 132,371 $ 99,050 International 8,166 5,038 26,564 15,203 1,414 2,902 Total $ 118,262 $ 89,839 $ 344,292 $ 244,923 $ 133,785 $ 101,952 |
Net Loss Per Share
Net Loss Per Share | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | 12. Net Loss Per Share Basic net loss per share is calculated by dividing the net loss available to common stockholders by the weighted-average number of common shares outstanding for the period. If applicable, diluted net loss per share attributable to common stockholders is calculated by dividing net loss available to common stockholders by the diluted weighted-average number of common shares outstanding for the period, determined using the treasury-stock method and the if-converted method for convertible debt. For purposes of this calculation, common stock subject to repurchase by the Company, common stock issuable upon conversion or exercise of convertible notes, preferred shares, options, and warrants are considered to be common stock equivalents and are only included in the calculation of diluted earnings per share when their effect is dilutive. Due to the Company’s net loss position, the effect of including common stock equivalents in the earnings per share calculation is anti-dilutive, and therefore not included. The following table presents the computation of basic and diluted net loss per share (in thousands, except per share amounts): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Numerator: Net loss $ ( 42,654 ) $ ( 36,793 ) $ ( 137,560 ) $ ( 116,510 ) Denominator: Weighted average common shares outstanding 122,468 104,804 117,026 102,561 Net loss per share, basic and diluted: $ ( 0.35 ) $ ( 0.35 ) $ ( 1.18 ) $ ( 1.14 ) The following potentially dilutive shares of common stock were excluded from the calculation of diluted net loss per share because their effect would have been anti-dilutive for the periods presented (in thousands): As of 2023 2022 Options to purchase common stock and employee stock purchase plan 2,567 3,142 Unvested restricted stock unit awards 7,606 8,744 Warrants to purchase common stock 8,226 17,486 Senior convertible notes 17,246 17,246 Total 35,645 46,618 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 13. Income Taxes To calculate its interim tax provision, at the end of each interim period the Company estimates the annual effective tax rate, adjusted for discrete items arising in that quarter. The computation of the annual estimated effective tax rate at each interim period requires certain estimates and significant judgment including, but not limited to, the estimated annual taxable income or loss for the year and projections of the proportion of income earned and taxed in foreign jurisdictions. The accounting estimates used to compute the provision for income taxes may change as new events occur, additional information is obtained, or the tax environment changes. The Company’s effective tax rate from operations wa s a benefit of 0.27 % and 0.11 % for the three and nine months ended September 30, 2023, respectively. The Company’s effective tax rate from operations wa s a benefit of 0.21 % and 0.16 % for the three and nine months ended September 30, 2022 , respectively. The Company’s effective tax rate differs from the federal statutory rate of 21 % in each period primarily due to the Company’s net loss position and valuation allowance. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2023 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 14. Related Party Transactions The Company purchases inventory from an affiliate of Squadron Capital, LLC (the “Squadron Supplier Affiliate”). David Pelizzon, President and Director of Squadron Capital, LLC, currently serves on the Company’s Board of Directors. For the three and nine months ended September 30, 2023, the Company purchased inventory in the amounts of $ 5.8 million and $ 14.1 million, r espectively, from the Squadron Supplier Affiliate. For the three and nine months ended September 30, 2022, the Company purchased inventory in the amounts of $ 2.7 million and $ 7.7 million, r espectively, from the Squadron Supplier Affiliate. As of September 30, 2023, and December 31, 2022 , the Company had $ 4.5 million and $ 2.4 million, respectively, due to the Squadron Supplier Affiliate, for inventory purchases. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | 15. Subsequent Events On October 27, 2023, the Company completed an underwritten public offering (the “Public Offering”) of 14,300,000 shares of the Company’s common stock, $ 0.0001 par value per share, at a price of $ 10.50 per share. The gross proceeds from the Public Offering, before deducting the underwriting discounts and commissions and other estimated offering expenses payable by the Company, were approximately $ 150.1 million. In connection with the Public Offering, the Company has granted the underwriters a 30-day option to purchase an additional 2,145,000 shares of common stock in the offering at the public offering price, less underwriting discounts and commissions. The Company expects to use the net proceeds from the Public Offering to fund general corporate purposes, including working capital, capital expenditures, acquisitions, or research and development. |
Organization and Significant _2
Organization and Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
The Company | The Company Alphatec Holdings, Inc. (the “Company”), through its wholly owned subsidiaries, Alphatec Spine, Inc. (“Alphatec Spine”), SafeOp Surgical, Inc. (“SafeOp”), and EOS imaging S.A.S. (“EOS”), is a medical technology company that designs, develops, and markets technology for the treatment of spinal disorders associated with disease and degeneration, congenital deformities, and trauma. The Company markets its products in the United States of America and internationally via a network of independent sales agents and direct sales representatives. |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. The Company translates the financial statements of its foreign subsidiaries using end-of-period exchange rates for assets and liabilities and average exchange rates during each reporting period for results of operations. All intercompany balances and transactions have been eliminated during consolidation. The accompanying condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Pursuant to these rules and regulations, the Company has condensed or omitted certain information and footnotes it normally includes in its annual consolidated financial statements prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”). The unaudited interim condensed consolidated financial statements reflect all adjustments, including normal recurring adjustments which, in the opinion of management, are necessary for a fair statement of the financial position and results of operations for the periods presented. These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, 2022, which are included in the Company’s Annual Report on Form 10-K that was filed with the SEC. Operating results for the nine months ended September 30, 2023 are not necessarily indicative of the results that may be expected for the year ending December 31, 2023, or any other future periods. |
Prior-period Adjustment | Prior-period Adjustment Subsequent to the issuance of the Company’s consolidated financial statements as of and for the year ended December 31, 2022, the Company identified that a deferred tax liability and additional goodwill related to the acquisition of EOS should have been recorded at the time of the acquisition. The Company corrected the errors in the accompanying condensed consolidated financial statements as of the earliest period presented and has concluded that the correction of these errors is not material to the previously issued financial statements. The correction to the accompanying unaudited condensed consolidated balance sheets, condensed consolidated statements of operations, condensed consolidated statements of comprehensive loss, condensed consolidated statements of stockholders' equity, and condensed consolidated statements of cash flows are as follows (in thousands): At December 31, 2021 Condensed Consolidated Statements of Stockholders' Equity As Reported Adjustment As Corrected Accumulated other comprehensive loss $ ( 5,994 ) ( 42 ) $ ( 6,036 ) Accumulated deficit $ ( 782,325 ) 1,294 $ ( 781,031 ) Total stockholders' equity $ 79,422 1,252 $ 80,674 At December 31, 2022 Condensed Consolidated Balance Sheets As Reported Adjustment As Corrected Goodwill $ 39,775 7,592 $ 47,367 Total assets $ 513,376 7,592 $ 520,968 Other long-term liabilities $ 11,543 5,546 $ 17,089 Accumulated other comprehensive loss $ ( 10,690 ) ( 104 ) $ ( 10,794 ) Accumulated deficit $ ( 934,474 ) 2,150 $ ( 932,324 ) Total stockholders' deficit $ ( 36,713 ) 2,046 $ ( 34,667 ) Total liabilities and stockholders' deficit $ 513,376 7,592 $ 520,968 Three Months Ended September 30, 2022 Nine Months Ended September 30, 2022 Condensed Consolidated Statements of Operations As Reported Adjustment As Corrected As Reported Adjustment As Corrected Income tax provision (benefit) $ 129 ( 206 ) $ ( 77 ) $ 461 ( 653 ) $ ( 192 ) Net loss $ ( 36,999 ) 206 $ ( 36,793 ) $ ( 117,163 ) 653 $ ( 116,510 ) Three Months Ended September 30, 2022 Nine Months Ended September 30, 2022 Condensed Consolidated Statements of Comprehensive Loss As Reported Adjustment As Corrected As Reported Adjustment As Corrected Net loss $ ( 36,999 ) 206 $ ( 36,793 ) $ ( 117,163 ) 653 $ ( 116,510 ) Foreign currency translation adjustments $ ( 4,851 ) ( 107 ) $ ( 4,958 ) $ ( 11,320 ) ( 230 ) $ ( 11,550 ) Comprehensive loss $ ( 41,850 ) 99 $ ( 41,751 ) $ ( 128,483 ) 423 $ ( 128,060 ) Three Months Ended March 31, 2022 Three Months Ended June 30, 2022 Three Months Ended September 30, 2022 Condensed Consolidated Statements of Stockholders' Equity (Deficit) As Reported Adjustment As Corrected As Reported Adjustment As Corrected As Reported Adjustment As Corrected Foreign currency translation adjustments $ ( 1,180 ) ( 24 ) $ ( 1,204 ) $ ( 5,289 ) ( 99 ) $ ( 5,388 ) $ ( 4,851 ) ( 107 ) $ ( 4,958 ) Net loss $ ( 42,844 ) 228 $ ( 42,616 ) $ ( 37,320 ) 219 $ ( 37,101 ) $ ( 36,999 ) 206 $ ( 36,793 ) Accumulated other comprehensive loss $ ( 7,174 ) ( 66 ) $ ( 7,240 ) $ ( 12,463 ) ( 165 ) $ ( 12,628 ) $ ( 17,314 ) ( 272 ) $ ( 17,586 ) Accumulated deficit $ ( 825,169 ) 1,522 $ ( 823,647 ) $ ( 862,489 ) 1,741 $ ( 860,748 ) $ ( 899,488 ) 1,947 $ ( 897,541 ) Total stockholders' equity (deficit) $ 41,984 1,456 $ 43,440 $ 10,539 1,576 $ 12,115 $ ( 22,569 ) 1,675 $ ( 20,894 ) Nine Months Ended September 30, 2022 Condensed Consolidated Statements of Cash Flows As Reported Adjustment As Corrected Net loss $ ( 117,163 ) 653 $ ( 116,510 ) Other long-term liabilities $ ( 50 ) ( 644 ) $ ( 694 ) Net cash used for operating activities $ ( 66,740 ) 9 $ ( 66,731 ) Effect of exchange rate changes on cash $ ( 1,166 ) ( 9 ) $ ( 1,175 ) |
Reclassification | Reclassification Certain financial statement line items in the condensed consolidated financial statements for the nine months ended September 30, 2022 have been aggregated to conform to the current year’s presentation. |
Use of Estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported amounts of revenues and expenses. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include the useful lives of property and equipment, goodwill, intangible assets, allowances for doubtful accounts, deferred tax assets, inventory, stock-based compensation, revenues, income tax uncertainties, and other contingencies. |
Fair Value Measurements | Fair Value Measurements The carrying amount of financial instruments consisting of cash and cash equivalents, accounts receivable, prepaid expenses and other current assets, accounts payable, accrued expenses, and short-term debt included in the Company’s condensed consolidated financial statements are reasonable estimates of fair value due to their short maturities. Authoritative guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: Level 1: Quoted prices in active markets for identical assets or liabilities. Level 2: Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active; or other inputs that can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. |
Excess and Obsolete Inventory | Excess and Obsolete Inventory Most of the Company’s inventory is comprised of finished goods, which is primarily produced by third-party suppliers. Specialized implants, fixation products, biologics, and disposables are determined by utilizing a standard cost method that includes capitalized variances which approximates the weighted average cost. Imaging equipment and related parts are valued at weighted average cost. Inventories are stated at the lower of cost or net realizable value. The Company reviews the components of its inventory on a periodic basis for excess and obsolescence and adjusts inventory to its net realizable value as necessary. The Company records a lower of cost or net realizable value (“LCNRV”) inventory reserve for estimated excess and obsolete inventory based upon its expected use of inventory on hand. The Company’s inventory, which consists primarily of specialized implants, fixation products, biologics, and disposables is at risk of obsolescence due to the need to maintain substantial levels of inventory. In order to market its products effectively and meet the demands of interoperative product placement, the Company maintains and provides surgeons and hospitals with a variety of inventory products and sizes. For each surgery, fewer than all components will be consumed. The need to maintain and provide a wide variety of inventory causes inventory to be held that is not likely to be used. The Company’s estimates and assumptions for excess and obsolete inventory are reviewed and updated on a quarterly basis. The estimates and assumptions are determined primarily based on current usage of inventory and the age of inventory quantities on hand. Additionally, the Company considers recent sales experience to develop assumptions about future demand for its products, while considering product life cycles and new product launches. Increases in the LCNRV reserve for excess and obsolete inventory result in a corresponding charge to cost of sales. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue from product sales in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Revenue from Contracts with Customers (“Topic 606”). This standard applies to all contracts with customers, except for contracts that are within the scope of other standards, such as leases, insurance, collaboration arrangements, and financial instruments. Under Topic 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration that the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of Topic 606, the entity performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. Sales are derived primarily from the sale of spinal implant products, imaging equipment, and related services to hospitals and medical centers through direct sales representatives and independent sales agents. Revenue is recognized when obligations under the terms of a contract with customers are satisfied, which occurs with the transfer of control of products to customers, either upon shipment of the product or delivery of the product to the customer depending on the shipping terms, or when the products are used in a surgical procedure (implanted in a patient). Revenue from the sale of imaging equipment is recognized as each distinct performance obligation is fulfilled and control transfers to the customer, beginning with shipment or delivery, depending on the terms. Revenue from other distinct performance obligations, such as maintenance on imaging equipment and other imaging-related services, is recognized in the period the service is performed, and makes up less than 10 % of the Company’s total revenue. Revenue is measured based on the amount of consideration expected to be received in exchange for the transfer of the goods or services specified in the contract with each customer. In certain cases, the Company does offer the ability for customers to lease its imaging equipment primarily on a non-sales type basis, but such arrangements are immaterial to total revenue in the periods presented. The Company generally does not allow returns of products that have been delivered. Costs incurred by the Company associated with sales contracts with customers are deferred over the performance obligation period and recognized in the same period as the related revenue, except for contracts that complete within one year or less, in which case the associated costs are expensed as incurred. Payment terms for sales to customers may vary but are commensurate with the general business practices in the country of sale. To the extent that the transaction price includes variable consideration, such as discounts, rebates, and customer payment penalties, the Company estimates the amount of variable consideration that should be included in the transaction price utilizing either the expected value method or the most likely amount method depending on the nature of the variable consideration. Variable consideration is included in the transaction price if, in the Company's judgment, it is probable that a significant future reversal of cumulative revenue under the contract will not occur. Estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on an assessment of the Company’s anticipated performance and all information that is reasonably available, including historical, current, and forecasted information. The Company records a contract asset when one or more performance obligations have been completed by the Company and revenue has been recognized, but the customer's payment is contingent on the satisfaction of additional performance obligations. The Company records a contract liability, or deferred revenue, when it has an obligation to provide a product or service to the customer and payment is received in advance of its performance. When the Company sells a product or service with a future performance obligation, revenue is deferred on the unfulfilled performance obligation and recognized over the related performance period. Generally, the Company does not have observable evidence of the standalone selling price related to its future service obligations; therefore, the Company estimates the selling price using an expected cost plus a margin approach. The transaction price is allocated using the relative standalone selling price method. The use of alternative estimates could result in a different amount of revenue deferral. |
Recently Adopted and Issued Accounting Pronouncements | Recently Adopted and Issued Accounting Pronouncements In August 2021, the FASB issued Accounting Standards Update ("ASU") No. 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers . The guidance requires application of Topic 606, Revenue from Contracts with Customers to recognize and measure contract assets and contract liabilities acquired in a business combination. ASU No. 2021-08 adds an exception to the general recognition and measurement principle in Topic 805 where assets acquired and liabilities assumed in a business combination, including contract assets and contract liabilities arising from contracts with customers, are measured at fair value on the acquisition date. Under the new guidance, the acquirer will recognize acquired contract assets and contract liabilities as if the acquirer had originated the contract. The standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022, with early adoption permitted. The Company adopted ASU No. 2021-08 as of January 1, 2023, on a prospective basis. The adoption of ASU No. 2021-08 did not have a material impact on the Company's condensed consolidated financial statements and related disclosures. In October 2023, the FASB issued ASU No. 2023-06, Disclosure Improvements - Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative. The guidance amends the ASC to incorporate certain disclosure requirements from SEC Release No. 33-10532 Disclosure Update and Simplification issued in 2018. The effective date for each amendment will be the date on which the SEC’s removal of that related disclosure from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited. ASU No. 2023-06 is not expected to have a material impact on the Company's financial statements. |
Organization and Significant _3
Organization and Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Schedule of Prior-period Adjustment | The correction to the accompanying unaudited condensed consolidated balance sheets, condensed consolidated statements of operations, condensed consolidated statements of comprehensive loss, condensed consolidated statements of stockholders' equity, and condensed consolidated statements of cash flows are as follows (in thousands): At December 31, 2021 Condensed Consolidated Statements of Stockholders' Equity As Reported Adjustment As Corrected Accumulated other comprehensive loss $ ( 5,994 ) ( 42 ) $ ( 6,036 ) Accumulated deficit $ ( 782,325 ) 1,294 $ ( 781,031 ) Total stockholders' equity $ 79,422 1,252 $ 80,674 At December 31, 2022 Condensed Consolidated Balance Sheets As Reported Adjustment As Corrected Goodwill $ 39,775 7,592 $ 47,367 Total assets $ 513,376 7,592 $ 520,968 Other long-term liabilities $ 11,543 5,546 $ 17,089 Accumulated other comprehensive loss $ ( 10,690 ) ( 104 ) $ ( 10,794 ) Accumulated deficit $ ( 934,474 ) 2,150 $ ( 932,324 ) Total stockholders' deficit $ ( 36,713 ) 2,046 $ ( 34,667 ) Total liabilities and stockholders' deficit $ 513,376 7,592 $ 520,968 Three Months Ended September 30, 2022 Nine Months Ended September 30, 2022 Condensed Consolidated Statements of Operations As Reported Adjustment As Corrected As Reported Adjustment As Corrected Income tax provision (benefit) $ 129 ( 206 ) $ ( 77 ) $ 461 ( 653 ) $ ( 192 ) Net loss $ ( 36,999 ) 206 $ ( 36,793 ) $ ( 117,163 ) 653 $ ( 116,510 ) Three Months Ended September 30, 2022 Nine Months Ended September 30, 2022 Condensed Consolidated Statements of Comprehensive Loss As Reported Adjustment As Corrected As Reported Adjustment As Corrected Net loss $ ( 36,999 ) 206 $ ( 36,793 ) $ ( 117,163 ) 653 $ ( 116,510 ) Foreign currency translation adjustments $ ( 4,851 ) ( 107 ) $ ( 4,958 ) $ ( 11,320 ) ( 230 ) $ ( 11,550 ) Comprehensive loss $ ( 41,850 ) 99 $ ( 41,751 ) $ ( 128,483 ) 423 $ ( 128,060 ) Three Months Ended March 31, 2022 Three Months Ended June 30, 2022 Three Months Ended September 30, 2022 Condensed Consolidated Statements of Stockholders' Equity (Deficit) As Reported Adjustment As Corrected As Reported Adjustment As Corrected As Reported Adjustment As Corrected Foreign currency translation adjustments $ ( 1,180 ) ( 24 ) $ ( 1,204 ) $ ( 5,289 ) ( 99 ) $ ( 5,388 ) $ ( 4,851 ) ( 107 ) $ ( 4,958 ) Net loss $ ( 42,844 ) 228 $ ( 42,616 ) $ ( 37,320 ) 219 $ ( 37,101 ) $ ( 36,999 ) 206 $ ( 36,793 ) Accumulated other comprehensive loss $ ( 7,174 ) ( 66 ) $ ( 7,240 ) $ ( 12,463 ) ( 165 ) $ ( 12,628 ) $ ( 17,314 ) ( 272 ) $ ( 17,586 ) Accumulated deficit $ ( 825,169 ) 1,522 $ ( 823,647 ) $ ( 862,489 ) 1,741 $ ( 860,748 ) $ ( 899,488 ) 1,947 $ ( 897,541 ) Total stockholders' equity (deficit) $ 41,984 1,456 $ 43,440 $ 10,539 1,576 $ 12,115 $ ( 22,569 ) 1,675 $ ( 20,894 ) Nine Months Ended September 30, 2022 Condensed Consolidated Statements of Cash Flows As Reported Adjustment As Corrected Net loss $ ( 117,163 ) 653 $ ( 116,510 ) Other long-term liabilities $ ( 50 ) ( 644 ) $ ( 694 ) Net cash used for operating activities $ ( 66,740 ) 9 $ ( 66,731 ) Effect of exchange rate changes on cash $ ( 1,166 ) ( 9 ) $ ( 1,175 ) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Assets and Liabilities Measured at Fair Value on Recurring Basis | Assets and liabilities measured at fair value on a recurring basis include the following as of September 30, 2023, and December 31, 2022 (in thousands): September 30, 2023 Level 1 Level 2 Level 3 Total Cash equivalents: Money market funds $ 62,949 — — $ 62,949 Total cash equivalents $ 62,949 — — $ 62,949 December 31, 2022 Level 1 Level 2 Level 3 Total Cash equivalents: Money market funds $ 62,956 — — $ 62,956 Total cash equivalents $ 62,956 — — $ 62,956 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | Inventories reported at the lower of cost or net realizable value consist of the following (in thousands): September 30, December 31, Raw materials $ 21,449 $ 13,928 Work-in-process 4,680 3,032 Finished goods 104,543 84,561 Inventories $ 130,672 $ 101,521 |
Property and Equipment, net (Ta
Property and Equipment, net (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property and equipment, net | Property and equipment, net consist of the following (in thousands, except as indicated): Useful lives September 30, December 31, Surgical instruments 4 $ 206,748 $ 158,906 Machinery and equipment 7 11,421 9,502 Computer equipment 3 5,388 4,753 Office furniture and equipment 5 5,547 4,760 Leasehold improvements various 3,797 2,965 Construction in progress n/a 20,280 15,360 253,181 196,246 Less: accumulated depreciation ( 119,396 ) ( 94,294 ) Property and equipment, net $ 133,785 $ 101,952 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The change in the carrying amount of goodwill during the period ended September 30, 2023 includes the following (in thousands): December 31, 2022 $ 47,367 Additions 24,582 Foreign currency fluctuation ( 394 ) September 30, 2023 $ 71,555 |
Intangible Assets, Net | Intangible assets, net consist of the following (in thousands, except as indicated): Remaining Avg. Gross Accumulated Intangible September 30, 2023: (in years) Amount Amortization Assets, net Developed product technology 6 $ 102,211 $ ( 22,512 ) $ 79,699 Trademarks and trade names 7 5,359 ( 1,370 ) 3,989 Customer relationships 3 14,141 ( 8,150 ) 5,991 Distribution network 1 2,413 ( 2,192 ) 221 Total amortized intangible assets 124,124 ( 34,224 ) 89,900 Software in development n/a 5,659 5,659 In-process research and development n/a 6,637 6,637 Total intangible assets $ 136,420 $ ( 34,224 ) $ 102,196 . Remaining Avg. Gross Accumulated Intangible December 31, 2022: (in years) Amount Amortization Assets, net Developed product technology 7 $ 75,896 $ ( 13,420 ) $ 62,476 Trademarks and trade names 8 5,421 ( 987 ) 4,434 Customer relationships 4 14,240 ( 6,906 ) 7,334 Distribution network 2 2,413 ( 2,041 ) 372 Total amortized intangible assets 97,970 ( 23,354 ) 74,616 Software in development n/a 2,503 2,503 In-process research and development n/a 5,662 5,662 Total intangible assets $ 106,135 $ ( 23,354 ) $ 82,781 |
Schedule of Intangible Assets, Future Expected Amortization Expense | Future amortization expense related to intangible assets is as follows (in thousands): Remainder of 2023 $ 5,691 2024 16,064 2025 14,575 2026 14,575 2027 12,703 Thereafter 26,292 $ 89,900 |
Contract Assets and Contract _2
Contract Assets and Contract Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Contract with Customer, Contract Asset, Contract Liability, and Receivable [Abstract] | |
Opening and Closing Balances of Company's Contract Assets and Liabilities | The opening and closing balances of the Company's contract assets are as follows (in thousands): September 30, December 31, Contract assets $ 1,868 $ — The opening and closing balances of the Company’s contract liabilities are as follows (in thousands): Balance at December 31, 2022 $ 15,003 Payments received 19,367 Revenue recognized ( 16,998 ) Foreign currency fluctuation ( 67 ) Balance at September 30, 2023 $ 17,305 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Outstanding Principal Amount and Carrying Value of Notes | The outstanding principal amount and carrying value of the 2026 Notes consists of the following (in thousands): September 30, December 31, Principal $ 316,250 $ 316,250 Unamortized debt issuance costs ( 5,799 ) ( 7,290 ) Net carrying value $ 310,451 $ 308,960 |
Principal Payments Remaining on Debt | Principal payments remaining on the Company's debt are as follows as of September 30, 2023 (in thousands): Remainder of 2023 $ 676 2024 1,466 2025 1,678 2026 317,748 2027 46,629 Thereafter 154,875 Total 523,072 Less: unamortized debt discount and debt issuance costs ( 14,693 ) Total 508,379 Less: current portion of long-term debt ( 1,766 ) Long-term debt $ 506,613 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Future minimum annual lease payments | Future minimum annual lease payments for all operating leases of the Company are as follows as of September 30, 2023 (in thousands): Remainder of 2023 $ 1,348 2024 5,455 2025 5,209 2026 5,152 2027 5,144 Thereafter 13,080 Total undiscounted lease payments 35,388 Less: imputed interest ( 5,802 ) Operating lease liabilities 29,586 Less: current portion of operating lease liabilities ( 5,090 ) Operating lease liabilities, less current portion $ 24,496 |
Summary of Weighted-Average Remaining Lease Term and Discount Rate | The Company’s weighted average remaining lease term and weighted average discount rate as of September 30, 2023 and December 31, 2022 are as follows: September 30, December 31, Weighted-average remaining lease term (years) 6.8 7.7 Weighted-average discount rate 5.5 % 5.5 % |
Summary of Operating Leases | Information related to the Company’s operating leases is as follows (in thousands): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Rent expense $ 1,597 $ 1,210 $ 4,156 $ 3,457 Cash paid for amounts included in measurement of lease liabilities $ 1,317 $ 1,032 $ 3,767 $ 3,183 |
Stock-Benefit Plans and Equit_2
Stock-Benefit Plans and Equity Transactions (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Summary of Total Stock Based Compensation | The Company has stock-based compensation plans under which it grants stock options, restricted stock units ("RSUs"), and performance restricted stock units ("PRSUs") to officers, directors and third parties. Total stock-based compensation for the periods presented are as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2023 2022 2023 2022 Cost of sales $ 2,369 $ 735 $ 24,601 $ 1,440 Research and development 6,790 1,653 9,587 3,987 Sales, general and administrative 10,914 8,689 26,541 25,037 Total $ 20,073 $ 11,077 $ 60,729 $ 30,464 |
Schedule of Assumptions used to Estimate Fair Value of Stock Options Granted and Stock Purchase Rights under ESPP | The Company estimates the fair value of shares issued to employees under the ESPP using the Black-Scholes option-pricing model. The assumptions used to estimate the fair value of stock options granted and stock purchase rights under the ESPP are as follows: Three and Nine Months Ended September 30, 2023 2022 Risk-free interest rate 4.54 % - 5.41 % 0.07 % - 1.54 % Expected dividend yield — — Expected term (years) 0.41 - 0.60 0.50 Volatility 40.87 % - 62.77 % 50.29 % - 64.53 % |
Summary of All Outstanding Warrants for Common Stock | A summary of all outstanding warrants for common stock as of September 30, 2023, are as follows (in thousands, except for strike price data): Number of Strike Price Expiration 2018 Squadron Medical Warrants 845 $ 3.15 May 2027 2019 Squadron Medical Warrants 4,839 $ 2.17 May 2027 2020 Squadron Medical Warrants 1,076 $ 4.88 May 2027 Executive Warrants 1,327 $ 5.00 December 2024 Other (1) 139 $ 7.41 Various through February 2026 Total 8,226 (1) Weighted-average strike price. |
Business Segment and Geograph_2
Business Segment and Geographic Information (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Net Revenue and Property, and Equipment, Net, by Geographic Region | Net revenue and property and equipment, net, by geographic region are as follows (in thousands): Revenue Property and equipment, net Three Months Ended Nine Months Ended September 30, December 31, (in thousands) 2023 2022 2023 2022 2023 2022 United States $ 110,096 $ 84,801 $ 317,728 $ 229,720 $ 132,371 $ 99,050 International 8,166 5,038 26,564 15,203 1,414 2,902 Total $ 118,262 $ 89,839 $ 344,292 $ 244,923 $ 133,785 $ 101,952 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Net Loss Per Share | The following table presents the computation of basic and diluted net loss per share (in thousands, except per share amounts): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Numerator: Net loss $ ( 42,654 ) $ ( 36,793 ) $ ( 137,560 ) $ ( 116,510 ) Denominator: Weighted average common shares outstanding 122,468 104,804 117,026 102,561 Net loss per share, basic and diluted: $ ( 0.35 ) $ ( 0.35 ) $ ( 1.18 ) $ ( 1.14 ) |
Anti-Dilutive Securities of Common Stock Excluded from Calculation of Diluted Net Loss Per Share | The following potentially dilutive shares of common stock were excluded from the calculation of diluted net loss per share because their effect would have been anti-dilutive for the periods presented (in thousands): As of 2023 2022 Options to purchase common stock and employee stock purchase plan 2,567 3,142 Unvested restricted stock unit awards 7,606 8,744 Warrants to purchase common stock 8,226 17,486 Senior convertible notes 17,246 17,246 Total 35,645 46,618 |
Organization and Significant _4
Organization and Significant Accounting Policies - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2023 | |
Maximum | |
Significant Accounting Policies [Line Items] | |
Percentage of revenue from other distinct performance obligations of total revenue | 10% |
Organization and Significant _5
Organization and Significant Accounting Policies - Schedule of Prior-period Adjustment - Condensed Consolidated Balance Sheets (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||
Goodwill | $ 71,555 | $ 47,367 | ||||||
Total Assets | 670,221 | 520,968 | ||||||
Other long-term liabilities | 11,626 | 17,089 | ||||||
Accumulated other comprehensive loss | (12,111) | (10,794) | $ (17,586) | $ (12,628) | $ (7,240) | $ (6,036) | ||
Accumulated deficit | (1,069,884) | (932,324) | (897,541) | (860,748) | (823,647) | (781,031) | ||
Total stockholder's deficit | (44,161) | $ (28,153) | $ (58,362) | (34,667) | (20,894) | 12,115 | 43,440 | 80,674 |
Total liabilities and stockholders' deficit | $ 670,221 | 520,968 | ||||||
As Reported | ||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||
Goodwill | 39,775 | |||||||
Total Assets | 513,376 | |||||||
Other long-term liabilities | 11,543 | |||||||
Accumulated other comprehensive loss | (10,690) | (17,314) | (12,463) | (7,174) | (5,994) | |||
Accumulated deficit | (934,474) | (899,488) | (862,489) | (825,169) | (782,325) | |||
Total stockholder's deficit | (36,713) | (22,569) | 10,539 | 41,984 | 79,422 | |||
Total liabilities and stockholders' deficit | 513,376 | |||||||
Adjustment | ||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||
Goodwill | 7,592 | |||||||
Total Assets | 7,592 | |||||||
Other long-term liabilities | 5,546 | |||||||
Accumulated other comprehensive loss | (104) | (272) | (165) | (66) | (42) | |||
Accumulated deficit | 2,150 | 1,947 | 1,741 | 1,522 | 1,294 | |||
Total stockholder's deficit | 2,046 | $ 1,675 | $ 1,576 | $ 1,456 | $ 1,252 | |||
Total liabilities and stockholders' deficit | $ 7,592 |
Organization and Significant _6
Organization and Significant Accounting Policies - Schedule of Prior-period Adjustment - Condensed Consolidated Statements of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||
Income tax provision (benefit) | $ (117) | $ (77) | $ (153) | $ (192) | ||||
Net loss | $ (42,654) | $ (51,377) | $ (43,529) | (36,793) | $ (37,101) | $ (42,616) | $ (137,560) | (116,510) |
As Reported | ||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||
Income tax provision (benefit) | 129 | 461 | ||||||
Net loss | (36,999) | (37,320) | (42,844) | (117,163) | ||||
Adjustment | ||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||
Income tax provision (benefit) | (206) | (653) | ||||||
Net loss | $ 206 | $ 219 | $ 228 | $ 653 |
Organization and Significant _7
Organization and Significant Accounting Policies - Schedule of Prior-period Adjustment - Condensed Consolidated Statements of Comprehensive Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||
Net loss | $ (42,654) | $ (51,377) | $ (43,529) | $ (36,793) | $ (37,101) | $ (42,616) | $ (137,560) | $ (116,510) |
Foreign currency translation adjustments | (2,600) | $ 178 | $ 1,105 | (4,958) | (5,388) | (1,204) | (1,317) | (11,550) |
Comprehensive loss | $ (45,254) | (41,751) | $ (138,877) | (128,060) | ||||
As Reported | ||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||
Net loss | (36,999) | (37,320) | (42,844) | (117,163) | ||||
Foreign currency translation adjustments | (4,851) | (5,289) | (1,180) | (11,320) | ||||
Comprehensive loss | (41,850) | (128,483) | ||||||
Adjustment | ||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||
Net loss | 206 | 219 | 228 | 653 | ||||
Foreign currency translation adjustments | (107) | $ (99) | $ (24) | (230) | ||||
Comprehensive loss | $ 99 | $ 423 |
Organization and Significant _8
Organization and Significant Accounting Policies - Schedule of Prior-period Adjustment - Condensed Consolidated Statements of Stockholders' Equity (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||||
Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||
Foreign currency translation adjustments | $ (2,600) | $ 178 | $ 1,105 | $ (4,958) | $ (5,388) | $ (1,204) | $ (1,317) | $ (11,550) | ||
Net loss | (42,654) | (51,377) | (43,529) | (36,793) | (37,101) | (42,616) | (137,560) | (116,510) | ||
Accumulated other comprehensive loss | (12,111) | (17,586) | (12,628) | (7,240) | (12,111) | (17,586) | $ (10,794) | $ (6,036) | ||
Accumulated deficit | (1,069,884) | (897,541) | (860,748) | (823,647) | (1,069,884) | (897,541) | (932,324) | (781,031) | ||
Total stockholders' equity (deficit) | $ (44,161) | $ (28,153) | $ (58,362) | (20,894) | 12,115 | 43,440 | $ (44,161) | (20,894) | (34,667) | 80,674 |
As Reported | ||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||
Foreign currency translation adjustments | (4,851) | (5,289) | (1,180) | (11,320) | ||||||
Net loss | (36,999) | (37,320) | (42,844) | (117,163) | ||||||
Accumulated other comprehensive loss | (17,314) | (12,463) | (7,174) | (17,314) | (10,690) | (5,994) | ||||
Accumulated deficit | (899,488) | (862,489) | (825,169) | (899,488) | (934,474) | (782,325) | ||||
Total stockholders' equity (deficit) | (22,569) | 10,539 | 41,984 | (22,569) | (36,713) | 79,422 | ||||
Adjustment | ||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||
Foreign currency translation adjustments | (107) | (99) | (24) | (230) | ||||||
Net loss | 206 | 219 | 228 | 653 | ||||||
Accumulated other comprehensive loss | (272) | (165) | (66) | (272) | (104) | (42) | ||||
Accumulated deficit | 1,947 | 1,741 | 1,522 | 1,947 | 2,150 | 1,294 | ||||
Total stockholders' equity (deficit) | $ 1,675 | $ 1,576 | $ 1,456 | $ 1,675 | $ 2,046 | $ 1,252 |
Organization and Significant _9
Organization and Significant Accounting Policies - Schedule of Prior-period Adjustment - Condensed Consolidated Statements of Cash Flows (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||
Net loss | $ (42,654) | $ (51,377) | $ (43,529) | $ (36,793) | $ (37,101) | $ (42,616) | $ (137,560) | $ (116,510) |
Other long-term liabilities | (4,995) | (694) | ||||||
Net cash used for operating activities | (53,481) | (66,731) | ||||||
Effect of exchange rate changes on cash | $ (275) | (1,175) | ||||||
As Reported | ||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||
Net loss | (36,999) | (37,320) | (42,844) | (117,163) | ||||
Other long-term liabilities | (50) | |||||||
Net cash used for operating activities | (66,740) | |||||||
Effect of exchange rate changes on cash | (1,166) | |||||||
Adjustment | ||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||
Net loss | $ 206 | $ 219 | $ 228 | 653 | ||||
Other long-term liabilities | (644) | |||||||
Net cash used for operating activities | 9 | |||||||
Effect of exchange rate changes on cash | $ (9) |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - Recurring - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value on a recurring basis | $ 62,949 | $ 62,956 |
Money Market Funds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value on a recurring basis | 62,949 | 62,956 |
Fair Value, Inputs, Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value on a recurring basis | 62,949 | 62,956 |
Fair Value, Inputs, Level 1 | Money Market Funds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets measured at fair value on a recurring basis | $ 62,949 | $ 62,956 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - Fair Value, Inputs, Level 1 - 2026 Notes - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Fair value of long-term debt | $ 304.6 | $ 288.8 |
Debt maturity year | 2026 |
Business Combination - Addition
Business Combination - Additional Information (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Apr. 19, 2023 | Sep. 30, 2023 | |
Business Acquisition [Line Items] | ||
Purchase price in cash | $ 55,000 | |
Navigation-enabled Robotics Platform | Asset Purchase Agreement | ||
Business Acquisition [Line Items] | ||
Purchase price in cash | $ 55,000 |
Inventories - Schedule of Inven
Inventories - Schedule of Inventories (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 21,449 | $ 13,928 |
Work-in-process | 4,680 | 3,032 |
Finished goods | 104,543 | 84,561 |
Inventories | $ 130,672 | $ 101,521 |
Property and Equipment, net - P
Property and Equipment, net - Property and Equipment, Net (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | |
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | $ 253,181 | $ 196,246 |
Less: accumulated depreciation and amortization | (119,396) | (94,294) |
Property and equipment, net | $ 133,785 | 101,952 |
Surgical instruments | ||
Property Plant And Equipment [Line Items] | ||
Useful life (in years) | 4 years | |
Property and equipment, gross | $ 206,748 | 158,906 |
Machinery and equipment | ||
Property Plant And Equipment [Line Items] | ||
Useful life (in years) | 7 years | |
Property and equipment, gross | $ 11,421 | 9,502 |
Computer equipment | ||
Property Plant And Equipment [Line Items] | ||
Useful life (in years) | 3 years | |
Property and equipment, gross | $ 5,388 | 4,753 |
Office furniture and equipment | ||
Property Plant And Equipment [Line Items] | ||
Useful life (in years) | 5 years | |
Property and equipment, gross | $ 5,547 | 4,760 |
Leasehold improvements | ||
Property Plant And Equipment [Line Items] | ||
Useful lives | various | |
Property and equipment, gross | $ 3,797 | 2,965 |
Construction in progress | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | $ 20,280 | $ 15,360 |
Property and Equipment, net - A
Property and Equipment, net - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation | $ 10.7 | $ 8 | $ 29 | $ 22.6 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Schedule of Goodwill (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2023 USD ($) | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
December 31, 2022 | $ 47,367 |
Additions | 24,582 |
Foreign currency fluctuation | (394) |
September 30, 2023 | $ 71,555 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Intangible Assets, Net (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Intangible Assets [Line Items] | ||
Total amortized intangible assets, Gross Amount | $ 124,124 | $ 97,970 |
Total amortized intangible assets, Accumulated Amortization | (34,224) | (23,354) |
Total amortized intangible assets, net | 89,900 | 74,616 |
Total Intangible assets, Gross Amount | 136,420 | 106,135 |
Total intangible assets, net | $ 102,196 | $ 82,781 |
Developed product technology | ||
Intangible Assets [Line Items] | ||
Intangible assets acquired amortized on a straight-line basis over useful lives | 6 years | 7 years |
Total amortized intangible assets, Gross Amount | $ 102,211 | $ 75,896 |
Total amortized intangible assets, Accumulated Amortization | (22,512) | (13,420) |
Total amortized intangible assets, net | $ 79,699 | $ 62,476 |
Trademarks and trade names | ||
Intangible Assets [Line Items] | ||
Intangible assets acquired amortized on a straight-line basis over useful lives | 7 years | 8 years |
Total amortized intangible assets, Gross Amount | $ 5,359 | $ 5,421 |
Total amortized intangible assets, Accumulated Amortization | (1,370) | (987) |
Total amortized intangible assets, net | $ 3,989 | $ 4,434 |
Customer Relationships | ||
Intangible Assets [Line Items] | ||
Intangible assets acquired amortized on a straight-line basis over useful lives | 3 years | 4 years |
Total amortized intangible assets, Gross Amount | $ 14,141 | $ 14,240 |
Total amortized intangible assets, Accumulated Amortization | (8,150) | (6,906) |
Total amortized intangible assets, net | $ 5,991 | $ 7,334 |
Distribution network | ||
Intangible Assets [Line Items] | ||
Intangible assets acquired amortized on a straight-line basis over useful lives | 1 year | 2 years |
Total amortized intangible assets, Gross Amount | $ 2,413 | $ 2,413 |
Total amortized intangible assets, Accumulated Amortization | (2,192) | (2,041) |
Total amortized intangible assets, net | 221 | 372 |
Software in development | ||
Intangible Assets [Line Items] | ||
Indefinite-Lived Intangible Assets, Gross Amount | 5,659 | 2,503 |
Indefinite-Lived Intangible Assets, net | 5,659 | 2,503 |
In process research and development | ||
Intangible Assets [Line Items] | ||
Indefinite-Lived Intangible Assets, Gross Amount | 6,637 | 5,662 |
Indefinite-Lived Intangible Assets, net | $ 6,637 | $ 5,662 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Additions to definite-lived intangible assets | $ 26,900 | |||
Additions to goodwill | $ 24,582 | |||
Additions to definite-lived intangible assets, useful life | 7 years | |||
Amortization of intangible assets | $ 4,100 | $ 2,800 | $ 11,100 | $ 7,200 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Schedule of Intangible Assets, Future Expected Amortization Expense (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Remainder of 2023 | $ 5,691 | |
2024 | 16,064 | |
2025 | 14,575 | |
2026 | 14,575 | |
2027 | 12,703 | |
Thereafter | 26,292 | |
Total amortized intangible assets, net | $ 89,900 | $ 74,616 |
Contract Assets and Contract _3
Contract Assets and Contract Liabilities - Opening and Closing Balances of Company's Contract Assets (Details) $ in Thousands | Sep. 30, 2023 USD ($) |
Contract with Customer, Contract Asset, Contract Liability, and Receivable [Abstract] | |
Contract assets | $ 1,868 |
Contract Assets and Contract _4
Contract Assets and Contract Liabilities - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Contract with Customer, Contract Asset, Contract Liability, and Receivable [Abstract] | |||||
Contract liabilities | $ 13,833 | $ 13,833 | $ 11,956 | ||
Contract liabilities, non-current | 3,500 | 3,500 | $ 3,000 | ||
Revenue from contract liabilities | 2,400 | $ 3,400 | 9,300 | $ 10,300 | |
Revenue recognized from contract liabilities | $ 5,900 | $ 6,400 | $ 16,998 | $ 16,500 |
Contract Assets and Contract _5
Contract Assets and Contract Liabilities - Opening and Closing Balances of Company's Contract Liability (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Contract with Customer, Contract Asset, Contract Liability, and Receivable [Abstract] | ||||
Balance at December 31, 2022 | $ 15,003 | |||
Payments received | 19,367 | |||
Revenue recognized | $ (5,900) | $ (6,400) | (16,998) | $ (16,500) |
Foreign currency fluctuation | 67 | |||
Balance at September 30, 2023 | $ 17,305 | $ 17,305 |
Debt - Term Loan (Details)
Debt - Term Loan (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jan. 06, 2023 | Sep. 30, 2023 | Sep. 30, 2023 | Sep. 28, 2023 | |
Debt Instrument [Line Items] | ||||
Initial term loan facility | $ 508,379 | $ 508,379 | ||
Braidwell Term Loan | Braidwell Transaction Holdings, LLC | ||||
Debt Instrument [Line Items] | ||||
Long term debt | $ 150,000 | |||
Initial term loan facility | $ 100,000 | |||
Debt instrument drew | $ 50,000 | |||
Credit facility outstanding balance | $ 150,000 | $ 150,000 | ||
Effective interest rate | 12.20% | 12.20% | ||
Debt instrument, maturity date | Jan. 06, 2028 | |||
Interest rate | 11.20% | 11.20% | ||
Interest expenses | $ 3,100 | $ 8,800 | ||
Amortization of debt issuance costs | 100 | 300 | ||
Amortization of debt discount | 100 | 200 | ||
Debt discount | 1,400 | 1,400 | ||
Debt issuance costs incurred | $ 3,400 | $ 3,100 | $ 3,100 | |
Commitment fees incurred | $ 1,500 | |||
Undrawn commitment fee | 1% | |||
Final payment fee percentage | 3.25% | |||
Interest rate terms | Borrowings under the Braidwell Term Loan bear interest at a rate per annum equal to the Term Secured Overnight Financing Rate for such SOFR business day ("SOFR") subject to a 3% floor, plus 5.75%. | |||
Braidwell Term Loan | Braidwell Transaction Holdings, LLC | Minimum | ||||
Debt Instrument [Line Items] | ||||
Fee amount percentage | 3% | |||
Braidwell Term Loan | Braidwell Transaction Holdings, LLC | Maximum | ||||
Debt Instrument [Line Items] | ||||
Fee amount percentage | 1% | |||
Braidwell Term Loan | Braidwell Transaction Holdings, LLC | Secured Overnight Financing Rate (SOFR) | ||||
Debt Instrument [Line Items] | ||||
Interest rate per annum | 5.75% | |||
Braidwell Term Loan | Braidwell Transaction Holdings, LLC | Secured Overnight Financing Rate (SOFR) | Minimum | ||||
Debt Instrument [Line Items] | ||||
Interest rate per annum | 3% |
Debt - Revolving Credit Facilit
Debt - Revolving Credit Facility (Details) - Revolving Credit Facility - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2023 | Dec. 31, 2022 | |
Line of Credit Facility [Line Items] | ||||
Maximum borrowing capacity | $ 50,000,000 | |||
Increase in borrowing capacity | 25,000,000 | |||
Maximum commitment amount | $ 75,000,000 | |||
Credit facility matures date | Sep. 29, 2027 | |||
Credit facility, matures period prior to final maturity date of 2026 notes | 90 days | |||
Interest expenses | $ 600,000 | $ 1,500,000 | ||
Amortization of debt issuance costs | 100,000 | 200,000 | ||
Credit facility outstanding balance | 46,000,000 | 46,000,000 | ||
Debt issuance costs incurred | $ 1,400,000 | |||
Debt issuance costs, net of accumulated amortization | $ 1,100,000 | $ 1,100,000 | ||
Interest rate | 8.90% | 8.90% | ||
Unused line fee percentage per annum | 0.50% | |||
Lockbox arrangement, percentage of revolving loan limit maximum availability | 30% | |||
Lockbox arrangement, revolving loan limit number of consecutive business day | 5 days | |||
Secured Overnight Financing Rate (SOFR) | ||||
Line of Credit Facility [Line Items] | ||||
Interest rate per annum | 3.50% |
Debt - 0.75% Senior Convertible
Debt - 0.75% Senior Convertible Notes due 2026 (Details) - 0.75% Senior Convertible Notes due 2026 | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||
Aug. 31, 2021 USD ($) $ / shares shares | Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2023 USD ($) Days | Sep. 30, 2022 USD ($) | |
Line Of Credit Facility [Line Items] | |||||
Aggregate principal amount of debt | $ 316,300,000 | ||||
Interest rate | 0.75% | ||||
Debt instrument, maturity date | Aug. 01, 2026 | ||||
Debt instrument, frequency of periodic payment | semi-annually | ||||
Debt instrument, Date of first payment | Feb. 01, 2022 | ||||
Net proceeds | $ 306,200,000 | ||||
Payment terms | Interest on the 2026 Notes is payable semi-annually in arrears on February 1 and August 1 of each year, beginning on February 1, 2022. | ||||
Debt instrument covenant description | The 2026 Notes do not contain any financial covenants. | ||||
Initial conversion rate | shares | 54.5316 | ||||
Debt instrument converted principal amount | $ 1,000 | ||||
Conversion price per share | $ / shares | $ 18.34 | ||||
Consecutive trading days | Days | 30 | ||||
Threshold percentage of par value trigger | 130% | 98% | |||
Number of conversion price, consecutive business days | Days | 5 | ||||
Number of conversion price, consecutive trading days | Days | 10 | ||||
Debt instrument converted principal amount | $ 1,000,000 | ||||
Debt conversion start date | Feb. 02, 2026 | ||||
Convertible notes redemption start date | Aug. 06, 2024 | ||||
Convertible notes, redemption price percentage | 100% | ||||
Principal payments due | $ 0 | ||||
Effective interest rate | 1.40% | 1.40% | |||
Interest expenses | $ 1,100,000 | $ 1,100,000 | $ 3,300,000 | $ 3,300,000 | |
Amortization of debt issuance costs | $ 500,000 | $ 500,000 | $ 1,500,000 | $ 1,500,000 | |
Minimum [Member] | |||||
Line Of Credit Facility [Line Items] | |||||
Threshold trading days | Days | 20 | ||||
Maximum | |||||
Line Of Credit Facility [Line Items] | |||||
Threshold percentage of par value trigger | 130% |
Debt - Outstanding Principal Am
Debt - Outstanding Principal Amount and Carrying Value of Notes (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
Principal | $ 523,072 | |
Net carrying value | 508,379 | |
2026 Notes | ||
Debt Instrument [Line Items] | ||
Principal | 316,250 | $ 316,250 |
Unamortized debt issuance costs | (5,799) | (7,290) |
Net carrying value | $ 310,451 | $ 308,960 |
Debt - Capped Call Transactions
Debt - Capped Call Transactions (Details) - 0.75% Senior Convertible Notes due 2026 - Capped Call Transactions $ in Millions | Aug. 05, 2021 USD ($) $ / shares |
Debt Instrument [Line Items] | |
Initial cap price | $ / shares | 27.68 |
Percentage of premium over last reported sale price of common stock | 100% |
Cost of capped call transactions | $ | $ 39.9 |
Debt - OCEANE Convertible Bonds
Debt - OCEANE Convertible Bonds (Details) € in Millions | 3 Months Ended | 9 Months Ended | |||
May 31, 2018 USD ($) ConvertibleBond | May 31, 2018 EUR (€) ConvertibleBond | Sep. 30, 2022 USD ($) | Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | |
Debt Instrument [Line Items] | |||||
OCEANEs remained outstanding | $ 508,379,000 | ||||
OCEANE Convertible Bonds | EOS Imaging S.A. | |||||
Debt Instrument [Line Items] | |||||
Number of OCEANE convertible bonds issued | ConvertibleBond | 4,344,651 | 4,344,651 | |||
Aggregate gross proceeds | $ 34,300,000 | € 29.5 | |||
Interest rate | 6% | 6% | |||
Payment terms | The OCEANEs were unsecured obligations of EOS, ranked equally with all other unsecured and unsubordinated obligations of EOS, and paid interest at a rate equal to 6% per year, payable semiannually in arrears on May 31 and November 30 of each year, beginning November 30, 2018 | ||||
Debt instrument, frequency of periodic payment | semiannually | semiannually | |||
Debt instrument, Date of first payment | Nov. 30, 2018 | Nov. 30, 2018 | |||
Debt instrument, maturity date | May 31, 2023 | May 31, 2023 | |||
Interest expense | $ 200,000 | $ 300,000 | $ 600,000 | ||
OCEANEs remained outstanding | $ 0 |
Debt - Other Debt Agreements (D
Debt - Other Debt Agreements (Details) - EOS Imaging S.A. $ in Millions | 1 Months Ended | 4 Months Ended | 9 Months Ended | |
Feb. 28, 2022 | Apr. 30, 2021 EUR (€) Agreement | Sep. 30, 2023 EUR (€) | Sep. 30, 2023 USD ($) | |
Line Of Credit Facility [Line Items] | ||||
Number of loan agreements | Agreement | 2 | |||
Debt instrument term | 12 months | 12 months | ||
Percentage of principal state guaranteed | 90% | |||
Percentage of cost of state guaranty | 0.25% | |||
Debt instrument interest-free rate amount | € 3,300,000 | |||
Effective interest rate | 1.75% | |||
Debt instrument interest rate amount | € 1,500,000 | |||
Line of credit facility description | The loan capital and loan guaranty costs are payable in full at the end of the 12-month term or the loan may be extended up to 5 additional years. If the Company chooses to extend the debt, the election must be made by the Company between months 8 and 11 of the 12-month term. | |||
Line of credit facility extension description | The extension will carry an interest rate at the banks’ refinancing cost, to be applied from year 2 to year 6 and an increased state guaranty cost (50 to 200 bps, as per a scale with company size and extension year). | |||
Debt instrument, extended maturity year | 2027 | |||
Loan One | ||||
Line Of Credit Facility [Line Items] | ||||
Outstanding loan obligation | € 3,000,000 | $ 3.2 | ||
Weighted average interest rate on loan | 0.98% | 0.98% | ||
Percentage of weighted average cost of state guaranty | 0.69% | |||
Loan Two | ||||
Line Of Credit Facility [Line Items] | ||||
Outstanding loan obligation | € 1,400,000 | $ 1.4 | ||
Weighted average interest rate on loan | 1.25% | 1.25% | ||
Percentage of weighted average cost of state guaranty | 1% | |||
Maximum | ||||
Line Of Credit Facility [Line Items] | ||||
Debt instrument loan extended additional period | 5 years |
Debt - Principal Payments Remai
Debt - Principal Payments Remaining on Debt (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Debt Disclosure [Abstract] | ||
Remainder of 2023 | $ 676 | |
2024 | 1,466 | |
2025 | 1,678 | |
2026 | 317,748 | |
2027 | 46,629 | |
Thereafter | 154,875 | |
Total | 523,072 | |
Less: unamortized debt discount and debt issuance costs | (14,693) | |
Net carrying value | 508,379 | |
Less: current portion of long-term debt | (1,766) | |
Long-term debt | $ 506,613 | $ 349,511 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) $ in Millions | 9 Months Ended | |
Dec. 04, 2019 ft² | Sep. 30, 2023 USD ($) | |
Loss Contingencies [Line Items] | ||
Lessee operating lease, description | Any short-term leases defined as twelve months or less or month-to-month leases are excluded and are expensed each month. Total costs associated with these short-term leases are immaterial to all periods presented. | |
Remaining minimum purchase commitment required | $ | $ 14.3 | |
Building Lease | ||
Loss Contingencies [Line Items] | ||
Operating lease term | 10 years | |
Area for facility of office, engineering and research and development space | ft² | 121,541 | |
Lease agreement commencement date | Feb. 01, 2021 | |
Lease agreement expiry date | Jan. 31, 2031 | |
Lease renewal term | 260 months | |
Annual increase in base rent | 3% | |
Minimum | ||
Loss Contingencies [Line Items] | ||
Operating lease term | 1 year | |
Maximum | ||
Loss Contingencies [Line Items] | ||
Operating lease term | 10 years |
Commitments and Contingencies_2
Commitments and Contingencies - Future Minimum Annual Lease Payments (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Commitments and Contingencies Disclosure [Abstract] | ||
Remainder of 2023 | $ 1,348 | |
2024 | 5,455 | |
2025 | 5,209 | |
2026 | 5,152 | |
2027 | 5,144 | |
Thereafter | 13,080 | |
Total undiscounted lease payments | 35,388 | |
Less: imputed interest | (5,802) | |
Operating lease liabilities | 29,586 | |
Less: current portion of operating lease liabilities | (5,090) | $ (4,842) |
Operating lease liabilities, less current portion | $ 24,496 | $ 26,562 |
Commitments and Contingencies_3
Commitments and Contingencies - Summary of Weighted-Average Remaining Lease Term and Discount Rate (Details) | Sep. 30, 2023 | Dec. 31, 2022 |
Commitments and Contingencies Disclosure [Abstract] | ||
Weighted-average remaining lease term (years) | 6 years 9 months 18 days | 7 years 8 months 12 days |
Weighted-average discount rate | 5.50% | 5.50% |
Commitments and Contingencies_4
Commitments and Contingencies - Summary of Operating Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | ||||
Rent expense | $ 1,597 | $ 1,210 | $ 4,156 | $ 3,457 |
Cash paid for amounts included in measurement of lease liabilities | $ 1,317 | $ 1,032 | $ 3,767 | $ 3,183 |
Stock-Benefit Plans and Equit_3
Stock-Benefit Plans and Equity Transactions - Summary of Total Stock Based Compensation (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation | $ 20,073 | $ 11,077 | $ 60,729 | $ 30,464 |
Cost of Sales | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation | 2,369 | 735 | 24,601 | 1,440 |
Research and development | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation | 6,790 | 1,653 | 9,587 | 3,987 |
Sales, general and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation | $ 10,914 | $ 8,689 | $ 26,541 | $ 25,037 |
Stock-Benefit Plans and Equit_4
Stock-Benefit Plans and Equity Transactions - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | |||||
Aug. 11, 2023 | Apr. 19, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Warrants outstanding | 8,226,000 | 8,226,000 | |||||
Common stock, par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||
Proceeds from common stock offering | $ 67,428 | ||||||
At the Market Offering | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of shares issued in transaction | 668,484 | ||||||
Common stock, par value | $ 0.0001 | ||||||
Proceeds from common stock offering | $ 9,900 | ||||||
Registered Securities Offering | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Common stock, par value | $ 0.0001 | ||||||
Proceeds from common stock offering | $ 57,500 | ||||||
Registered Securities Offering | Common Stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of shares issued in transaction | 4,285,715 | ||||||
Shares offering price per share | $ 14 | ||||||
Mr. Miles | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Warrant expiration period | 5 years | ||||||
Warrant extended term | 7 years | ||||||
Number of warrants exercised | 0 | ||||||
Safe Op Surgical Inc | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Warrant expiration period | 5 years | ||||||
Number of warrants exercised | 0 | 937,000 | 257,000 | ||||
Warrants outstanding | 0 | 0 | |||||
2018 Common Stock Warrants | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Warrant expiration period | 5 years | ||||||
Proceeds from exercise of warrant | $ 400 | $ 400 | |||||
Number of warrants exercised | 14,000,000 | 6,311,000,000 | 140,000,000 | ||||
Warrants outstanding | 0 | 0 | |||||
Squadron Medical | Participant Lender | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of warrants exercised | 0 | ||||||
RSU's and PRSUs | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Unamortized compensation expense | $ 70,500 | $ 70,500 | |||||
Unamortized compensation expense to be recognized over weighted average period | 1 year 8 months 8 days | ||||||
Shares of common stock issued before net settlement | 789,000 | 563,000 | 5,714,000 | 3,103,000 | |||
ESPP | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares issued under ESPP | 0 | 0 | 247,000,000 | 222,000,000 |
Stock-Benefit Plans and Equit_5
Stock-Benefit Plans and Equity Transactions - Schedule of Assumptions used to Estimate Fair Value of Stock Options Granted and Stock Purchase Rights under ESPP (Details) - ESPP | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Risk-free interest rate, minimum | 4.54% | 0.07% | 4.54% | 0.07% |
Risk-free interest rate, maximum | 5.41% | 1.54% | 5.41% | 1.54% |
Expected term (years) | 6 months | 6 months | ||
Volatility, minimum | 40.87% | 50.29% | 40.87% | 50.29% |
Volatility, maximum | 62.77% | 64.53% | 62.77% | 64.53% |
Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected term (years) | 4 months 28 days | 4 months 28 days | ||
Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected term (years) | 7 months 6 days | 7 months 6 days |
Stock-Benefit Plans and Equit_6
Stock-Benefit Plans and Equity Transactions - Summary of All Outstanding Warrants for Common Stock (Details) shares in Thousands | 9 Months Ended | |
Sep. 30, 2023 $ / shares shares | ||
Class Of Warrant Or Right [Line Items] | ||
Number of Warrants | 8,226 | |
2018 Squadron Medical Warrants | ||
Class Of Warrant Or Right [Line Items] | ||
Number of Warrants | 845 | |
Strike Price | $ / shares | $ 3.15 | |
Expiration | May 2027 | |
2019 Squadron Medical Warrants | ||
Class Of Warrant Or Right [Line Items] | ||
Number of Warrants | 4,839 | |
Strike Price | $ / shares | $ 2.17 | |
Expiration | May 2027 | |
2020 Squadron Medical Warrants | ||
Class Of Warrant Or Right [Line Items] | ||
Number of Warrants | 1,076 | |
Strike Price | $ / shares | $ 4.88 | |
Expiration | May 2027 | |
Executive Warrants | ||
Class Of Warrant Or Right [Line Items] | ||
Number of Warrants | 1,327 | |
Strike Price | $ / shares | $ 5 | |
Expiration | December 2024 | |
Other Warrants | ||
Class Of Warrant Or Right [Line Items] | ||
Number of Warrants | 139 | [1] |
Strike Price | $ / shares | $ 7.41 | [1] |
Expiration | Various through February 2026 | [1] |
[1] Weighted-average strike price. |
Business Segment and Geograph_3
Business Segment and Geographic Information - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2023 Segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 1 |
Business Segment and Geograph_4
Business Segment and Geographic Information - Schedule of Net Revenue and Property, and Equipment, Net, by Geographic Region (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Revenues From External Customers And Long Lived Assets [Line Items] | |||||
Revenue | $ 118,262 | $ 89,839 | $ 344,292 | $ 244,923 | |
Property and equipment, net | 133,785 | 133,785 | $ 101,952 | ||
United States | |||||
Revenues From External Customers And Long Lived Assets [Line Items] | |||||
Revenue | 110,096 | 84,801 | 317,728 | 229,720 | |
Property and equipment, net | 132,371 | 132,371 | 99,050 | ||
International | |||||
Revenues From External Customers And Long Lived Assets [Line Items] | |||||
Revenue | 8,166 | $ 5,038 | 26,564 | $ 15,203 | |
Property and equipment, net | $ 1,414 | $ 1,414 | $ 2,902 |
Net Loss Per Share - Computatio
Net Loss Per Share - Computation of Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Numerator: | ||||
Net loss | $ (42,654) | $ (36,793) | $ (137,560) | $ (116,510) |
Denominator: | ||||
Weighted average shares outstanding, basic | 122,468 | 104,804 | 117,026 | 102,561 |
Weighted average shares outstanding, diluted | 122,468 | 104,804 | 117,026 | 102,561 |
Net loss per share, basic: | $ (0.35) | $ (0.35) | $ (1.18) | $ (1.14) |
Net loss per share, diluted: | $ (0.35) | $ (0.35) | $ (1.18) | $ (1.14) |
Net Loss Per Share - Anti-Dilut
Net Loss Per Share - Anti-Dilutive Securities of Common Stock Excluded from Calculation of Diluted Net Loss Per Share (Details) - shares shares in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities not included in diluted net loss per share (in shares) | 35,645 | 46,618 |
Options to purchase common stock and employee stock purchase plan | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities not included in diluted net loss per share (in shares) | 2,567 | 3,142 |
Unvested restricted stock unit awards | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities not included in diluted net loss per share (in shares) | 7,606 | 8,744 |
Warrants to purchase common stock | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities not included in diluted net loss per share (in shares) | 8,226 | 17,486 |
Senior Convertible Notes | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities not included in diluted net loss per share (in shares) | 17,246 | 17,246 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | ||||
Effective income tax rate from operations | 0.27% | 0.21% | 0.11% | 0.16% |
Federal statutory income tax rate | 21% | 21% |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - Squadron Supplier Affiliate - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Related Party Transaction [Line Items] | |||||
Purchased inventory from related party | $ 5.8 | $ 2.7 | $ 14.1 | $ 7.7 | |
Due to Affiliate | $ 4.5 | $ 4.5 | $ 2.4 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Oct. 27, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Sep. 30, 2023 | Dec. 31, 2022 | |
Subsequent Event [Line Items] | |||||
Common stock, par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||
Proceeds from common stock offering | $ 67,428 | ||||
Common Stock | |||||
Subsequent Event [Line Items] | |||||
Common stock shares issued | 668,000 | 4,286,000 | |||
Subsequent Event | Underwritten Public Offering | |||||
Subsequent Event [Line Items] | |||||
Common stock, par value | $ 0.0001 | ||||
Additional common stock shares granted to purchase, optional | 2,145,000 | ||||
Additional common stock shares purchase period | 30 days | ||||
Subsequent Event | Underwritten Public Offering | Common Stock | |||||
Subsequent Event [Line Items] | |||||
Common stock shares issued | 14,300,000 | ||||
Shares offering price per share | $ 10.5 | ||||
Subsequent Event | Public Offering | |||||
Subsequent Event [Line Items] | |||||
Proceeds from common stock offering | $ 150,100 |