Earnings call transcript Q2 2023

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Operator

Good day and thank you for standing by. Welcome to the RxSight Second Quarter 2023 Earnings Conference Call. [Operator Instructions]. Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your first speaker today, Alex Huang. ahead. go Please

Alex Huang

three Presenting release Officer, operator. Shelley RxSight and website. copy for President Earlier June months Thank XXXX. available XX, Ron today on Kurtz; Executive A the results financial Dr. RxSight the Officer, and and Chief six today, ended press you, of released are months is Chief Thunen. company's Financial the

result management's and views like statements, certain responses and I expectations, of forward-looking we would to today's those results inform of Actual call that include during begin, differ other and X, reflect -- to risks including August expressed materially comments as the today, a plans, will XXXX. from uncertainties. questions Before implied you or information. may predictions, And estimates, opinion and as

are These the filings our fully risks and our Commission, SEC. described with today issued press or uncertainties more and release in Securities Exchange and in

found are forward-looking disclaim filings to the SEC and we or or any can to be on statements, on reliance these revise not undue cautioned update our website forward-looking Our Investors statements. obligation website. SEC's place

measures that will be press be certain non-GAAP financial GAAP measures, including replay website. in measures. found We available this note on reconciliations conference with audio also call release. most for comparable regarding Please non-GAAP the the investor Disclosures discuss financial can will our

to Chief Executive and Kurtz. call Officer, President With over that, the will I Ron turn Dr.

Ron Kurtz

higher top-line we operating us. driven another tenth and for joining Good quarterly for period representing Today, report consecutive growth afternoon, thank key quarter-over-quarter and you by metrics. our RxSight, strong of performance

later position. underlying I'll further steps taken trends strengthen in discuss business the favorable the call. we financial our our addition, have In to

and sheet our Shelly financial XXXX recent will first, quarter second But balance transactions. review performance

Shelley Thunen

compared second afternoon, XX%, to XX% you, everyone. of quarter the the million compared the the first of XX% quarter devices units million $XX.X XX generated the $XX.X year-ago XX% quarter in up We to of revenue XX quarter and units in $XX.X sold the delivery in compared quarter in to up compared year-ago to up million RxSight Ron. second XX of up the XXXX XXXX. in Good light XXXX. Thank first XXXX, And period.

LDD and the $X.X of of revenue of XXXX, XXXX, XX% and quarter sales versus first XX% XXXX second up million Second respectively. quarter generated quarter

installed of our As quarter the June second XX% quarter to units, XXXX first XX, and and XXXX, up increased LDD XX% XXX base XXXX, of respectively. of versus

quarter XX% year, LALs the XXXX, to XX,XXX in We in XXX% and XX,XXX the units of same up and sold year-ago quarter the quarter compared first of units and second this X,XXX respectively.

Second of quarter revenue, quarter first sales million and $XX.X million XXX% of XXXX XXXX, respectively. in in and the generated the XXXX XX% unit compared LAL the $X.X to quarter million and $XX.X up second

of the XXXX. in year-ago from revenue and in of first the of margin to first quarter XX% compared XXXX represented of and XX% XX% second quarter quarter in in the quarter second XXXX, XX% in quarter the XX% total of XXXX, Gross was up the revenue LAL XX% quarter second and of same XXXX respectively.

LDD sales. decreases, first margin gross price and LAL Recall by included freight that the favorably cost quarter other impacted in XXXX was of improvements savings, in costs material

G&A. sales year-ago second quarter, versus $XX.X change in expectations. expenses and costs in XX% with marketing, increased personnel is $XX.X reflecting sequential SG&A as XXXX increased and stock-based and compensation expenses the slight the in consistent and were and So, up travel marketing our in of sales, million, million noncash quarter the

quarter year-ago of the the in XXXX. the $X.X quarter to of in to was expenses to and million first increased quarter. $X.X the SG&A sequential due rose due And in up costs personnel a clinical XX% second XX% study to versus million R&D same On increased year-ago basis, XXXX quarter in year compared The costs. primarily marketing headcount. from increased costs and increased the $X.X were expenses million primarily headcount increased change

We a share loss shares. or weighted of basic reported quarter of a GAAP basic compares quarter. of net or on loss net share $XX.X This $XX.X basis in in outstanding diluted using a and per average $X.XX shares of diluted the year-ago per XX.X same loss GAAP of and second XXXX million $X.XX to million million a the

respectively, second resulting Noncash of stock-based of in million and debt on loss $X non-GAAP or diluted extinguishment basic loss of $X.XX of was $X.X a loss quarter share. million in the compensation and a per and XXXX $XXX,XXX,

cash included of today's compared XXXX in The investments program, cash issuances termination from million comparative to operations. for stock the less proceeds XXXX. the change March at the and ATM and includes option cash, the with paydown our balance We used non-GAAP million to $XX reconciliation stock at-the-market in in unaudited and more purchase or employee share cash ended plan press in plus of $XXX.X information. $XXX.X release million refer XX, equivalents, short-term GAAP disclosure quarter Please fees exercises, of second and

and bonus second during activities cash was in accounts XXXX. relative in inventory quarter the and capital from second in quarter cash the debt million. of This of payouts million to the $X.X used XXXX, and compares used higher operating which first the repayments, receivable annual financing in and for capital included quarter in increases principal of Excluding use proceeds to activities $XX.X operating activities

indicated we operations cash On from our XXXX. expect quarterly in used that last in conference reductions sequential call, we

and accounts our a in operations tick payable up receivable accounts primarily may second due lower we was cash However, because the quarter terms accrued improvements than expected from used expenses. quarter higher third see and to in

designed of further sale proceeds quarter sheet the fees used ATM $XX.X to to our shares. implement balance common raising through to program continue We net million our our of we XXXX, strengthen off noted paid of reduce second our by and of to million additional the these debt remaining we fees press under million $XX the million balance. today's term $XX.X million. $XX an as $X.X release, July raised debt loan And in ATM During net in

our prior million $XX increasing guidance. we million are to quarter million, second $XX $XX performance, XXXX million. on XXXX of Turning now Based range guidance guidance our up to to $XX to from

Our new XX% quarter typical third of guidance assumes cataract due XX% the vacation to a seasonality year-over-year a to and schedules. growth lighter pattern summer rate with implies

range we of from gross to The margin also XXXX revising XX% with the XX% fourth the of gross margin to reconfigured XX%. continuing shipping year are this benefit begin versus our reflects quarter. for a improved guidance LDD, in mix increase to with largely to We prior along favorable guidance which expect revenue gross LAL our sales, XX% margin

increase the in top and $XXX million guidance of expanded at operating our the our reflects with of $X fees are February the our December XX, the XXXX with fiscal million We cap increasing an to market SARBANES-OXLEY, additional expense to quarter, The the became fees relating XXXX. bottom increase be XX-K of second the and of filed and subject year-end range. in to we auditor headcount Section $XXX million in XXX(b) XXXX, implementation Act effective increase to SARBANES-OXLEY consulting of

$XX stock-based postoperative OpEx continued guidance represents a compensation infrastructure XX% XX% investments growth. durable, to It includes $XX noncash sustained XXXX to reflects also and support procedure a The to large, long-term million. expense of LAL million our build XXXX treatment rise to light over primarily

of million. have interest debt, in off and interest XXXX, program, paid balances, balance no confidentially balance healthy $X.X and strengthen approximately raised to term our profitability with $XX a leaves combined annual our outstanding with late believe expense We our sheet. our well-positioned cash investment operations achieve sheet through loan debt us net offering ATM $XXX.X million reduced marketed term we million Since by fees and public from

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

Ron Kurtz

Thank to long-term you, week, we position marked today RxSight for progress Shelly. time success. and our my to made the second IPO, like anniversary use the we've I'd highlight to Last of

substantially our of our done scope organization, increased a evidenced growth the business. remarkable trends the we First, as which size commercial in has by two-year job and

revenue to XXX% and second up Compared are sales quarter XXX%. XXXX, unit more quarterly LDD up of by than the was

currently two is installed Canada. accounts size same three and was now into of the LAL almost ago XXX% total the extends for revenue. are Our unit and this sales Over roughly period, our years up majority base it times

investor fivefold execution At foundation As Shelly also we added the a us future strengthen in strategy rise sets new institutional same in and the base for position. sheet provides our a continued daily shareholders summarized, RxSight meaningful which time, we've institutions average can the a just continued increase growth path the increased and base, balance profit. consider stock. trading operating that to our our of volume believe a experienced strong for has and of our substantially on universe have of to with ownership along we market Which, capitalization

and focused experience We across test can The possible premium on unique the that to drive their desired customize since patients. IPO best has our light range two success vision precise and the the past knowledge other patient of results our these adjustability from the to to technology lens base and of our high-quality apart the continually outstanding and the types doctors allows arrive preferences. enable outcome. postoperative today Driving IOL they performance a wide market critical efforts deliver refining patients because to in every at visual LAL LAL for achieve stands years adjustable been

excellent of clinical underscores vast a LAL's with visual The years binocular of superior the lenses. collected uncorrected effects without side to growing over vision. of glare but data as are with or doctors over such majority two real-world prioritized contrast ability patients to achieve A body and and visual acuity deliver halo past the the distances range fixed consistently achieving power by increasingly vision in of increases combination difficult being in that outcomes reductions competing are patients

enables achieve return important additional infrastructure. By standard be leveraged variety into tap established the appealing the that can to premium and a stream of revenue an patients, treatment an existing LDD premium light for further as LAL investment to on rapid practitioners a ongoing IOL and wide practices

In to important collaborating been customers steadily LAL will We past the closing, utilization, which with the a strides growing our believe the in company. team and continue this with rising years. factor are has has be public that made over two pleased in as RxSight we investors an

early value are the the premium on the thoughtful beginning the of occupy continued market, stages of all expansion believe delivering and sustained the market. in can growth Through a the a our focus is fuel customer adoption, long-term landscape strategy, of we needs still execution to this in cataract While LAL and to leading stakeholders. change IOL LAL we position high-growth premium ultimately

ask open for call With questions. the the that, to I'll operator

Operator

[Operator Instructions].

Please from of question first proceed Craig Our Securities. with is BofA question. your Bijou

[Operator Instructions].

comes Our from JPMorgan. proceed question next Robbie with Please your question. of Marcus

Robbie Marcus

the we're utilization row start, really nice a by in in Great. LDD you my Congrats question. lens seeing tick-up know, on quarter. in where a is quarter this the the per quarter. for nice taking third Maybe, Thanks a to math, in

now first pretty significant second, and quarter starting fourth think and it's I in the step up. a

So trends speak you're to the some maybe seeing. just of

How percentage across broad-based Is And across users? in from is well. portfolio? top my top this as question wholesome throw or is the bottom then, I'll second more a driven by it to it

You've where from LAL you had about LDD quarter future is or uptake really broader, going LDD are placements? How the, stand now LDDs Thanks penetration base? in over XXX. growth nice lot. a to thinking of And be another versus The of installed potential of is more you placement. base terms coming

Ron Kurtz

you, Thank add in Shelly start, I'll can Robbie. and anything.

broad-based. to generally, utilization, increase the been in has with respect we utilization So, think

to the continued of to the in established utilization existing technology the as practice benefits those infrastructure as of have some that to who practices. already customers more seen And -- as they've in access their that doctors has been have is the increase attributable

with also light broadly because then adjustable of more characteristics the the new are both known. And customers, lens

in a with team more are larger as our And well And with of team, so, then, starting both starting commitment to doctors clinical technology, which our sales confident consists of trainers. the course, volumes. of our as more

have information to we expand efficiently the for them more start the more years over how to last As efficiently. learned and practices to several give

been those So, the to of I factors have would would LAL that of anything in continue there, all -- we Shelly? growth those anticipate think factors add and utilization,

Shelley Thunen

No.

Ron Kurtz

think still are to several as you that above the U.S. And We There still do With we're thousand minority a noted, of respect those. a in we're the XXX overall fraction that's practices possibility cataract in surgery. of LDD penetration, now.

growth for side room see well. still we LDT as the on So,

Shelley Thunen

add a I would Yes, little just to clarify bit.

the few majority, XX,XXX surgery. thousand, -- clarify of in just LDD that then to to the terms X,XXX today the are well total penetration, nice a what LDD things of for had about number. to discipline we've One Ron as on in X,XXX that's pricing maybe our very sales terms said ASP been are good of remained is there has who surgeons about believe narrow. the and in the pricing. We do XX% U.S. cataract That the changes of And

is obviously, don't fishing market. the also to high-volume those Ron? surgeons the our total in an patients believe fish IOL, market other as allow we results practices. But in else, with fact, today, specifically but mature, get it to we're opportunity the LAL for limited get are, more premium their to and to offers superior we them Because, provide where Anything

Ron Kurtz

follow-up, Robby? Any No.

Robbie Marcus

answered No, a lot. all. appreciate the I it taking question. Thanks you

Operator

[Operator Instructions].

Our next question Lichtman please from question. your proceed Co. Steve Oppenheimer & of comes with

Steven Lichtman

you, Thank everyone.

the Beyond standout margin other side. the to top the gross line, be on looked

the where Or then of you quarter So, underlying system in the One, LDD secondly, a there. couple questions should fourth lower-cost else can level be Is just think exiting there gross afoot? driving Shelley, you A a it on benefit? set And mix? what's place? margin we us with is something

Shelley Thunen

the gross driven mix, substantially LAL see by LDD Steve. few amount is we we One the and of in well. been level, course, you, right, Thank as as LAL margin as increased have a also really things. down gone Okay. the trend. production has Costs we at that Yes, the of we've than -- with continuing more the profitable have margin a is, the something

think We margin, in what in not the but second have that expansion a bear will to first we see expect our the and Due the quarter, will to nice quarter. higher gross fact fourth benefits. that much third margin to we LDD the relative in reconfigured achieved and do some

upon as So, we based well the some only fourth differential but our third as should of and quarters see not LDD. reconfigured introduction between mix the the

Steven Lichtman

the sequential this big coming And of coming and increase Great. talk LDD number? saw ASCRS where expectations. that you that Thanks. And is then did real above presence? just of number, my seeing in that and have LDD nice that you our Can how on here pretty follow-up, guess, to what I Thanks. you tailwinds we're of part any conference out a here out

Ron Kurtz

that in a I has certainly, helped QX. had We agree. very and ASCRS, strong us

I awareness interest awareness and that light think practices. on the increasing parts adjustable it's generally with drives the of about lens consistent

would grown trend has sequentially, that So, would to continue a see we grow. we as that that and hope

Steven Lichtman

Ron. Thanks, Thanks, Shelley.

Operator

Instructions]. [Operator

next Our from with Ryan Please your question of question. Zimmerman proceed BTIG. comes

Ryan Zimmerman

we questions, it and the expanding, market maybe when you've in the ask and question and first. of here, adoption, question Hi, when market, the good feels of afternoon. opportunity And couple clinical -- just be like of done of could Canada, a your congrats kind commercial U.S., aspirations Ron, may the that trial big the beyond I kind strategy in more aperture how what such some guess if does your U.S. to on you see just a widening. not is change I good uptake hints you internationally Mexico of a were see nice quarter. the the picture earlier terms or cases And but that? we of I think just as view aspirations this seen wanted your always are But talked quarter, it as

Ron Kurtz

international you as ophthalmology terms especially So, traditionally in pay Ryan, of terms But U.S. is of an the led has know, field. private really the in markets.

as in well. we're the significant But -- the And so, Canada, on is have initially continue see our with opportunities U.S. and do as And U.S. to we're develop focused -- focus. we we developing primary outside market that we'll time. those started fully we'll

Shelley Thunen

the relative the think you disarray mark I to of approvals. to specifically and kind CE from because their

we of does would for anyway. kind that's that something don't trigger opportunity that, pulled we on so push But think the off European have And any us.

U.S. the Given the opportunity in

Ryan Zimmerman

if And color of what question, that commentary yet cataract to of larger that, ophthalmic then your said appreciate of I'm market, we've of one weak. they've is And of, up been the second health given curious some peers second earnings Shelly. kind good reported market continue market large results. the really the earlier this competitors? I think, Since some premium a from in row, you of seen of quarter the I your health the incremental season the view put the in the has Okay. said

Ron Kurtz

within overall, the the market the for practices market, continued receive. by cataract to overall grow other then premium their grow for relative surgery and main opportunity driven in the continues to services. cataract cataract still market reductions Well, demographics. revenue is And to reimbursement they that -- -- reimbursed

for So, have our being you we And as growth see in we as noted, a the premium primary engine continue numbers to seen market grow. ophthalmology.

Operator

[Operator Instructions].

your next Please Our Biegelsen Fargo. of Larry question. question Wells with from proceed comes

Unidentified Analyst

is okay? on This me you for Can hear Charles Larry.

Shelley Thunen

Yes.

Unidentified Analyst

follow quarter. building start preparing guys Second Is sounded up LDD, was refresh newer that just nice going -- wanted the there approved availability And where inventory of little update approach? you on you for so be are half it I Last the that is there on going Can a of any your and year, a the about? to inventory? year. to lower-cost congrats launch talk at limit at us an like First, bit give second kind to by half to Thanks. phased be launch. the

Ron Kurtz

Thank Charles. you,

towards So, the our as has year. margin. same as its on was reconfigured the the LDD the impact earlier to year. It you And we're the Shelly anticipating noted, -- in the will functionality approved that primarily end noted, as have current LDD be of has primarily

see for there. So changes that year, has really many the been I and our don't plan

Shelley Thunen

stabilized. not reconfigured we question but we're it's goods finished of To Supply to as and that chain chain. strategy until is one our has tough, the stock certain And well still to the the supply is LDD have your continuing supply improve. is chain as introduce

that full our that customers. part and of have we availability ensuring for is so And strategy our

Unidentified Analyst

Okay, great. you. Thank

Operator

[Operator Instructions].

Bijou proceed Craig from Securities. comes your with of BofA question next question. Please Our

Craig Bijou

afternoon. Good

I you're thank -- -- truly results anecdotally, but guess other Is two patient guess awareness? a to that kind level initial docs and you're slot. level premium and price I bit see what questions my the on follow-up I before, seen? potentially what premium on But I the I Is the question was or ground on And the asked the competitive ability it has patient about seeing Sorry it's the wanted a to field it of -- to at doctor that to is the competition. believe had missed the of from hearing IOLs? it earlier. a satisfaction,

And is heard know of have bigger or kind that lenses anything second or just question you the worries then you there. and the some of guys players of the new competition about of development

Ron Kurtz

in So, results I the awareness that lens is more becomes offer factor. think the the you that things all in the the that doctors important to Craig, can doctors, of mentioned, play. the more system patients and are them doctors an available to allows the then with of obtain practice. Once quality patients, it light-adjustable Certainly, to

these And the think the is I have So, in the a all -- doctors results are commensurate to things the well. that and a of play. its pricing produces. obviously really quality factor with ability -- of technology a as are level ROI at strong it

growth. So, all important to those of are

-- be it technology remains to and make be not it's able adjustable the aspects that that. else as projects see when even whether we somebody out competition same the lens, on this some can the of seen don't going and With the the do -- horizon visibility that the are does everybody a to respect all easy far as to only an competition, task there, There anything but is delivers we have again, midterm. in is to we near to the of tell, light

to be slew enters market they'll have in at a even improvements -- somebody a to requirements. entering technology then already when And the they point of response do, when introduced whole we'll if

a going think to to road follow. I it's tough for So, somebody be

Craig Bijou

it. follow-up Got helpful. quick for Thanks, Ron. a That's Shelley. And maybe

margins. how take it where On LDD my about to But peak guess the that bring how of peak about and can gross think question guess new does I you get it's should long is margin. you And longer-term part we to I level?

Shelley Thunen

in LDD company? -- the specifically you're not you about the run think or I the talking about So, for reconfigured are overall long asking margins

Craig Bijou

margins, provide reluctant you more Shelly, Yes, details. overall been have I know to some

margins you're to it, company. but the willing just I'd if So, to give hear overall for detail, love

Shelley Thunen

Yes.

product and this the the able volume LDD, think XX% than so, we've as that towards expect and we've And as lower reconfigured be -- with hopefully, to the been in I've we high I stabilize we got good to and XX% before, margin that more well. that said end to range, because in

the there's we LAL, sales, of razor, if would really, the run, think come market expect term, gross it has our seen. stable, been and in of range companies, of XX%, blade XX% price offers. mid-XX% big but would value as high level, maybe very so we long because be long razor as probably Overall, but the to LDD the remains expect for that typical out revenue I to far even is that margin long from And a be will in

Operator

Instructions]. [Operator

David of next Needham question Please from Co. & your proceed Our Saxon comes question. with

David Saxon

the quarter. Hi, Hi, Yes. Congrats since questions. my years Shelley. taking Thanks follow-up to one of been been Craig's you've on! two to public. Ron. question. Maybe It's for

further been a the You've along launch. in little

and seeing question of has interest So, Or awareness areas also, to color are few pushback -- been the on kind and ask, years has docs the more same a the docs of I were the getting -- and of of And engaging sales it's established? just placing you out with changed? as how and cycle prospective wanted from hearing any ago? a you LDDs

Ron Kurtz

you, Thank Yes. David.

think same I interactions general on. are the going

they can team, and have a might commercial I get too we have point more that not or other and can we new at practices think we only them. to from but like us, from that practices more customers so we can larger looking our that information that experience and refer obviously, technology be more experienced

the ROI we're faster. capital piece last years, of months established Six has months equipment. of on for piece and is obviously to we nine intraocular the pretty And But over have quite average be unlike quick. -- that that lenses, a for example, can several So, other a we've cost that capital it. to

still that comfortable their go And so through on own to coming analysis. they new board makes practices but more need financial

have both similar think I been so, have potential business answers say we customers. But never it we've in gets and -- would I And and for before more models easy. it's seen I Shelly

David Saxon

Got Shelly. it. Maybe a follow-up for

expense guidance. operating the on Just

around XX% back it first in we in half XX% implies growth versus half. growth the think I saw the

So, be what's driving that? -- there What investments anything would making are helpful. you

Shelley Thunen

Thank you much. so

Of well course, I stock. associated the mention audit as did expenses the stock as with fees

impact right the few get we at of You other people And our most and we year. the to those end applications year. that year, OpEx of managers LDD really of quarter, the sales. a and what expand the well third clinical drives course, also, We for year. during our get marketing full up you as pace -- the in fourth need the as with add by account that And you back-end as the additions exit personnel had and of that's

David Saxon

Thank you. Great.

Operator

remarks. would conference to the Ron to time, further this no turn like now at I and for showing back closing I'm Kurtz questions

Ron Kurtz

for thank Well, attention all time and you your today.

As RxSight future and always, to we updating in appreciate you our look forward progress quarters. in Goodbye. your on interest

Operator

today's you conference concludes participating. Thank call. This for

disconnect. You may now

RxSight (RXST) 7 Aug 232023 Q2 Earnings call transcript