LUNG - Earnings call transcript Q1 2022

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Thank you for standing by, and welcome to the Pulmonx Q1 2022 Earnings Conference Call. At this time, all participants are in a listen-only. After the speakers there will be a question-and-answer session. [Operator Instructions] As a reminder, today's call is being recorded. I would now like to turn the call over to your host, Mr. Gilmartin the at Johnston, Group. Brian begin. Sir, you may

Brian Johnston

all Thanks, today's in you operator. afternoon, and Good for call. participating thank

Joining me release Earlier from Executive Pulmonx copy quarter are Glendon French, XXXX. XX, on Derrick financial for A Chief the ended released website. March Officer; the President Sung, Financial available Pulmonx Officer. press today, of results the is and and Chief company's

of on prospects and could events are operating organization, our anticipated expansion material our for These reliance upon these actual assumptions. and should place these margin market you statements, XXXX. during statements uncertainties to not of without to relating implied of gross estimates operating future Act begin, relate you to statements. or that the our safe impact product results limitation, to meaning statements I'd undue within pipeline forward-looking revenue, trends and business opportunity, make on various forward-looking in include in like the or remind our current expense securities are financial performance, of this risks for by management, expenses, for growth and Any we Reform the which forward-looking this events, and and call that Before results forward-looking materially that based or will that including COVID-XX statements differ contained statements call are to Litigation laws, those or made guidance involve hiring, expectations federal those of cause the development predictions performance future recovery, management Private from pursuant Securities provisions expectations All statements. harbor Accordingly, statements. commercial

with call time associated business, SEC intention XX-K description except Report and XXXX. Securities This with the conference as required risks the projections X, the over on Annual on obligation, and new refer sensitive with filings Form and revise I'll contains of section law, otherwise. or For a to of statements, our of Commission, Exchange March the that, the to public XXXX. list by including broadcast our and the May Risk whether because financial disclaims Factors of only filed please information uncertainties or accurate turn live future today, or as With call events any X, forward-looking or update is Glen. any Pulmonx Corporation information, to the

Glendon French

Good welcome Brian. to XXXX first call. and afternoon, everyone, our quarter earnings Thanks,

at to Here We year-end Valve. the trends, achieve end first progress Zephyr the objective patient extended achieve US the saw to officer. recovery in have hospital and treating in as of track and treatment, continued indicators to above trends, year only with XX footprint the me Zephyr recovery to and these team. States. centers StratX of $XX The such our Valves uploads awareness Omicron offering Derrick to full were commercial $XX.X Despite on to from our upticks, procedure in the not of COVID, million our observed us of impact million. calls global our ability enabled increased high clinician the worldwide momentum eager during to our patient in centers reschedule remain reimbursement to least and to centers We remain United total we progress treating centers meet bringing timing offering the of business recovery begin expectations. Overall, quarter, US XXX. Based our make into encouraged as chief conduct Centers to we procedures. also our followed million widespread confidence financial previously of revenue impact support $XX wave sales new but which leading guidance physicians by our our addition We to and on of began to of strength treatment quarter. the is first Sung, XXX steady by drive gained a in expand our initiatives we treating and communicated also this resulting the to that in our on

we inquiries. As number training call product-related respond US clinical center launched we are infrastructure to the opened in increased to of we sales, levels patient significant center accelerate demand. we patient physician second our To growing interested investing physician education performing procedures. for technology, our in and to support interest Zephyr of help in have recently field provide our clinicians to Further, Valve the patient a

the hyperinflation. to to significantly demonstrating severe an in pleased April study that patients a valves and Shield endobronchial Journal And found front, to million Zephyr another reimbursement payer their valves positive patients patients, Valves, may have third COPD over the of key Great now US emphysema. Pennsylvania front, we plan coverage largest of was severe a with in lung that reduction, all endorsed all those adds treatment not implant. lives. and Medicine lung severe Cross Reflecting evidence to the nearly be of adding lung in predictor survived and those volume win, clinical commercially Zephyr Cardiothoracic with life independent this post policy an the Valves. Independence improve with positive The Independence study observational region. survival. the published progress Ireland and outcomes than the streamlined We XXth yet of over study access longer our on receive Cross in Britain extend and Cross Blue Zephyr patients Blue Cross, the reduction Blue covered we with valves On with volume its which of Blue for Mid-Atlantic clinical expectancy benefits were lives the Society of who Respiratory did lung X In body of of XXXX finding Blue in is treatment Shield also of Surgery to reduce use for the treated additional to with to ever-growing volume released bronchoscopic Blue over Valves COPD XX% secured the the covered lives covered XX% payer standards

We also American San the from International XX May in Conference through forward Francisco. attending look Thoracic the to XXth Society

have major remains posters pulmonary commercial our to reflected at treatment the topic central presence, the look will across Zephyr since and in-person the of presentations this pulmonary Valve driving year. that will booth as will ATS clinical we and pandemic awareness reduction scientific of we numerous discussion bronchoscopic by first volume forward space therapy. medical the a be medicine Our the feature start congress This where lung and an of

a to Zephyr with our initiatives. expand development our market clinical fissure development severe due under good an ventilation. collateral which presenting between not emphysema progress which clinical our patients about AeriSeal We're some addressable program, excited continue half our currently lobes, opportunity patients We be to We to level for Valves make estimate in also just incomplete eligible AeriSeal ventilation to stands to therapy. Zephyr complement of of for allows collateral present tremendous to Valve

multinational studied are to will running from the fall. is seal treatment on in Valves patients Our of Zephyr program Information application IDE multi-center, of is we be trial, a development subset being a patients This now AeriSeal many This look in later we to these learn for which with focused CONVERT first a this candidates hope feasibility preliminary used of our study. CONVERT our provide from today. a Europe. not We that at are to U.S. CONVERT who design study, will present data the inform using fissure to path AeriSeal gaps.

Japan Lastly, the geographic treatment by year. of from a expansion end approval Valve we the of to continue in expect perspective, regulatory our Zephyr

to to a business with the the of of the need pandemic. when of XXX,XXX Following to long-term looking back business treatment. a the summary, Derrick significant absence $X half year, quarter billion achieve mentioned market. the I'm we opportunity estimate results. of trajectory our to in the milestones we as I'm In in commercial optimistic approximately out expect patients detailed reimbursement, over establishment half hope headwinds. in With to grow forward to some be now provide year our to our our review of launch ability addressable growth I'll next more the accelerate expand Zephyr turn we demonstrate particular, about previously we of efforts we to And what that, of first the entering this our to Valve of call of expect COVID In back when

Derrick Sung

million quarter period. expenses margin of of the through. start same The million on the constant million million, quarter XX% increase of in remainder swept XX% the first the XXXX the the quarter expansion $XX.X decrease during prior year-over-year increase on the Thank the quarter for $X.X an period of the quarter first back XXXX, of the you, $X.X as was XX%, to $X a revenue period the and of the Stock-based variant operating in impacted XXXX. Gross revenue a Glen. Total range to worldwide $X increase margin was and quarter XX% affected expense nearly in increase Omicron COVID our And good US for were for basis. million afternoon, three business first compared in procedures. of COVID we everyone. a an XX% XX% for wave basis. efficiencies, to from year the at $X.X Total of the XX, same XXXX $XX.X across ability remain the months margin March year increasing year million, $XX.X first from $X.X restarted to constant gross half expect prior million, driven of increase passed compensation hospitals was last year. the was from X% of of a procedures all of currency first a in production schedule and million, X% the that in and quarter year International was period. in the by the prior revenue year gross the first in a from the Global XXXX in XX% million Hospitals continue regions XXXX. of to currency a XX% during revenue by ended was was

and decrease expect were continue scale compensation $XXX stock-based approximately research expenses of programs the million expense, loss quarter XXXX, or team we first to for of quarter XXXX marketable expenses increase was in compared million the quarter per to the of We million, to $XXX.X per further of our was marketing non-cash to quarter cash for as Net prior of prior to commercial activities March operations, from in million XXXX fall ended of expenses $XX.X the the $XXX increase first sales $X.X loss first continue compared for XX.X the attributable million per increase an between quarter determine to of a XXXX. of year share needed administrative operating first build first $XX in invest product year. XXXX period December $XX.X expanded share development business. to to same in million expenses as commercial and and scaling we and in the inclusive with our a a our of XX, of public million, full and loss in weighted million R&D increase equivalents out and XXXX. development-related of and loss and the clinical average commercial for million study, Sales, for or as million personnel, securities, to in $X due share, $XX.X $XX.X company cash, our year. and increased The to XX, the expenses an $X.XX was administrative regulatory XXXX of of the shares to XXXX. support count was compared a We million, general The loss share and activities. were of of infrastructure. our general primarily related our development increase period research An for an clinical of expenses to $X.XX same net $XX.X million the used

to our outlook turning for XXXX. Finally,

of remain that $XX revenue million ability confident seeing million. achieve we to our XXXX in $XX the full recovery in year range our in With to are business, we the

volumes back will near for seen questions. end procedure levels growth thank sequential attention, We and second with through your open I'd expect last of normalize. you in to to by quarter sales as to that, up the we recover And Operator? remainder see the now for call the of year, like the followed XXXX

Operator

[Operator Bank question Steed you. first Our comes from Travis America. Instructions] of Thank of

open. Your line is

Travis Steed

ago, indicators. is thanks and three quarter, leading looks more March And basically to the on you love QX Congrats QX. recovery a still of versus But in Hi. unchanged versus mentioned I'd the or the April the little and on questions. like color early for for kind Derrick, you months get guidance with QX. it noticed line

So I'd QX point. guidance updating the to this you're not at see love why

Derrick Sung

Sure, we provide on into question. part the the that Travis. and of saw latter the Thanks can some through quarter I'll for guidance Glen take QX. commentary that

a our we're we on confidence half back Travis, very the million does us the a underway. we're the recovery be our months previously we the in QX said, changing pretty laid of ability That based an say million coming right. off that So feeling strength recovery that All would ago, give at laid saw the lot this early year, seeing based couple business that relative early to and just indicators only premature just good the I our on guidance a point achieve it feels suggest about at of we of the hit that into to momentum of haven't for half to enduring out The out. that bottom of going our $XX a in deep guidance QX, guidance in beginning us months is year. $XX initial two

that of last impact from pandemic we've have. underestimate worst us. year, it's the not one the is certainly But to expect and thing we continuing might if So behind the COVID that learned hope

still some variants, want impact into get possible play and skis and out. uncertainties the of we there might of in these more staffing around uncertainty So hospital we future point don't this some before front at to just how some visibility of our get remains

very feel want comment seeing and you this do the out we're want the into don't in quarter, of cadence quarter? point momentum on monthly but our seeing to into the what good we're we we in the going about to again, recovery just to skis. and front So Glen, what the get

Glendon French

I Sorry about on mute. was that.

quarter, January significantly time, always had, accelerated is the last by the done first was those half impacted case, the are was In reported rescheduled. that half are the - we we quarter mean, the out. back We As COVID. first of the I of that cases as are

January through pull ones the those first cases as back out. so And scheduled that halfway well to and February were were

contained a and most of, the some of you if we got guess, part people out will, that what backlog, how call explains and consumed, into And bit think So of that came good across of the latter I March backlog we of quarter. kind that February March.

Travis Steed

QX for the all pretty about year? a No, course the improve makes expecting still sense When the that and to what guidance. just you're - the you now staffing ground. of think thanks the big Is it on and in curious color, over how constraints, that constraint the you're that seeing

Derrick Sung

Yeah.

of things that they're lot staffing in probably the of Omicron definitely of to Physicians sort we before hear the come that long back to I think say The of centers we're do the procedures short. spread is is it mean, different coming would happening virtually you staffing the the sure we around. now. and is I rebound in in, it actually. able relatively But that theme The seen ways, are And are believe I'm hospitals, right? of us the the how centers, And trying they sort hits you're So many some we delayed are issue, in not some in ways XXXs hospitals way lot. what's things. we're right a getting have talking terms impacted. continue multiple folks - that the I that in see I which way about out in the about a of and treating we're all of the wave. broader at of is out that, So turnaround it in has that the impacts to impacted docs low probably

than to have So uncommon do that come patients asked of it's stresses not along be we might out. as fewer that in sort staffing clipping say, on certain the per to prior hospitals to month back at, been four

our issues that some think to to this, take through As time are through. working some there it are going way broader get relates to I

folks are year. who about end I to staffing when the the are running think of carrying issues through listen hospitals I talking

and to it think think the or two, with because having patients associated I staffing kinds treating execution will those procedures away staffed. a quarter of the the as just relates properly I of of the that largely procedures, we're and revenue of generation wash those

Travis Steed

for Thanks again, good and the the color, to start year.

Glendon French

Thanks.

Operator

Thank you.

Stanley. next comes Cecilia Our Furlong from of Morgan question

is open. line Your

Cecilia Furlong

wave to seen what the I from acceleration. Good an really ask up afternoon, you've a taking and wanted greater a on in potentially for just out coming productivity you're bit from question. ways. And again, on just prior seen this what thank of the standpoint, staffing you issue, standpoint ground versus limiting you've account staffing seeing the factoring follow in but what

Derrick Sung

really and impacted first we quarter, on significantly Well, report Yeah. a as on imagine. basis quarterly productivity productivity was you in might the

a down I through waves, where by no really So it that same of was from everywhere wave time. entirely we been had just the hit explained, prior is think, quite the sort which at other the fact bit running

it shutting Omicron. engines impacted getting other And United down, was But case. crushed regions literally us. consequence, the as which at to the wasn't quarter, extent, were procedures there whether really talking you were we nearly imagine, if case with about the full speed, always talking in regions, running mean about the while not And a a you're business whether can I effectively that's within our half during it large so global you're that States, were or

impacted Our well. got as productivity

looked forth, so and we've the I to and the got in the not is the - how the time particularly in the think as most - How accounts. the we're has was way at particularly activity, it that I imagine, - probably might has, think, much down think where into account similar and past, quarter. I that The frame. of account metric of measure is shutdown this you for of is to even it's impacted, actual that another ways XXs by interesting more staffing, So that which a January impacted February really out due in it pulling also

of of - significant because in yet impacted bed still vaccinated. XX-fold probability the business there ICU - a continued of about was occupying the proportion that had population person. increase the the half be to be the the There in were think who they an number a was versus first I a our to unvaccinated vaccinated people quarter

I population, in difference think We've out environment in the had the XX% vaccinated, vaccinated of considered has nearly is the we're in people twice, once. depending to everyone CDC, population in the on think want least States is week, that XX% at, And source which the coming right reports of got of two last now United longer multiple to US that was vaccinated States to naive of that's look been United no thirds the fully COVID at been COVID. XX% indicated that which already. new I data the of there you have

mean, just population of if ago, very less - people, you two population, there's is few So where was the European I race the COVID. XX% XX% naive the less to human naive, US than years than of

year. of the is going relatively little issue for move this that waning to think is probably of ahead, an of before pull certainly we be and anticipate see us issue we for continue bit to COVID but be us. a ahead, the we near think as out going staffing end So we term, the an We in that to as we look

Cecilia Furlong

as place as pulling physician initiatives on if well, and would point. back, up Okay, drive you continue look specifically referring forward, that quantify awareness how you really is could in this at COVID the have to as great. to And physician just you higher? I And follow referring awareness

Glendon French

physicians. been And that XX% and At on sales question the for are where through XX% really is And referring productivity haven't that to this treated you've today, have on question, that we've long account don't activity to really referring the and least over we business Thank of and is important patients this treating up the we and from, very as right It's get of coming a and you really through sites focused patients we as Cecilia. our - are both probably and coming coming point, increasing this believe going grow we the question. awareness. getting insightful I Obviously, to based is central sufficient support the think our us, move heard awareness physicians of ahead. marketing running. is from haul,

more execution reoriented for really sites. talking the in to opening centers. training, the we've our new than only the continue physicians about We're case on are of best really So focus shifted the but we've the sales past referring up to up going do fundamentally on that. was where opening practices process But we're also to not focus sales these sales what new

of starting at Now this has effectively become the area a focus primary year. this beginning of

we it seen how referring as That's I going in expect our physicians. numbers So to we faced Omicron gathering to move as best as through good of the the have we're headwind we're of that as a we mean from and insult data results. move revenue impact consequence, the the metric forward it experienced. direct clearly a crosswind we be probably ahead. bit still And will

with patients and thing we're about well. as before, can other talked mentioned really Often think focusing on that introduction is the The that we've to engaging I provide the the I doctors. patients script, in the referring

to Doe doctor, information come seeing engage. my to very program sense, opt We a contact for treating us needs can their to with and and actually and to back where have their there's in in lead go ask from in with we us to willingness their some doctors a We're than journey where it from going the with no to and toward give them also direct authorization information. nurture them talk say up the requests hotter their those to way they follow And you're can is to physician. and that to specifically for indicated. to a us forth compliant go their than us has Jane patients, those get help going patient in seeing doctor We're provide up a

- often with providing will to as deliver the So and that physician to well. referring involve information them

only own physicians referring of So their sales being the to surrogate with be not physician, that program. patients activity, advocates sort talk we're through to doctor or but equipping attacking activity, a also with marketing the my

Cecilia Furlong

the Thank you taking Great. for questions.

Operator

Thank you. comes next Our [Operator of instructions] question Sandler. Bednar Jason from Piper

Your line is open.

Unidentified Analyst

is taking Hey, good Thanks guys. afternoon, my Jason. Joe on for questions. for This

make or So penetration interaction post in have any a previous Has entries? up far? the should I there dynamics just thus for off pre the different authorities that market we we've then from for any terms those question market or on the would thinking Japanese Japanese And about regulatory what any been in launches with that that structural seen feedback submission. or of factory be when the in anything

Glendon French

The remarkably Japanese regulatory process and has been interactive. consistently

directly we we I say interacting weekly. say haven't involved, I but would been - had would I don't So - I are - have

So one way another. or

had addressed questions. questions. meetings gotten So We've scheduled and than actually have shorter it's we've been we great. And better those We've and gone anticipated. those meetings

to already. and any it be would that major that this have frequent and if well were moving going and interactions there along So have frankly point be have popped to expected I been substantive, seems the would issues to

general With past. great process to that a trying of confident this as regard we and identify in the to get feel we've the So end structural before manager of requirements, for year, we in comfortable are that the stated multiple approval that marketplace. regulatory times we'll

about either in I in the so think our Japan. added we that quarter we last or employee first talked had

So going be a of small tagged are we're got we're as market ready an of And that when process. place. and there feet again, organization ensure framework we've reimbursement through reimbursement on bunch out is in working move that the building to sort consultants in that got end We're to there. to of relatively well, of a we've to

ourselves So that late year. we next see in market

in So or to, with other the that of launching in any as was important to markets had the first we that in were relatively guidelines, recently that relates the for entered of we global place. expect the how we example, to that all was when the we behave entered in world is US the we've it market market enter because the US the where published, we market data reimbursement regard

And so Japan, markets Having means handful hierarchical physicians entered that we've we expect be since to anybody a like the will very that we that, and US, tone that. market, doesn't to like be from woes to of there's it's two handfuls will that a which the said would to the first. or we They setting US and entered go going them first. who benefit

know who So we they are.

with We they cases were have relationships already, ones sure first the to that they way. make the most will the of them and will we do lead and

States or a United maybe see around say, one entered relate markets United year slope, entered these the much like other we up on that we the So States is quite very but we and steep time see we year basis. and maybe two the looking as not sloping in a contrast to, being capita France, the it market per maybe

Unidentified Analyst

Great. for just super And then helpful. one me. more That's

as roles the an like just mentioned update moving but give actually the plan And through past in the on to Japan on new tire roles? been and today whether any over US adds, as notable outside you what's touching calls, of tours these have there in guess, then terms in mentioned. months? these And filling I few other you've Japan, new Just in could you Europe, of

Glendon French

it you question. part Derrick, missed all? did of that I get

Derrick Sung

I did.

US. new asking, add either So within or any you think US territories were outside and In outside territory about we of the I did the new adds Joe, not within QX, US the the US.

the US. we So active still XX and have XX the outside US in territories

in XX-ish end handful, we to as And year. and we five as the in by well both the internationally a plan add of so now the continue, mentioned geographies. US year last throughout add to to near expect the this to We be selectively we'll in call, three or

QX. we specifically none adding but So continue to in plan

Unidentified Analyst

Great. Thanks a lot.

Operator

you. Thank

Plovanic question comes of Canaccord. Our from next Bill

Your line is open.

Unidentified Analyst

Plovanic. Bill for wanted to All Hello. questions David the is were ask on answered. that we This

you thank on and congrats great much, quarter. So a very

Derrick Sung

Thank you, David.

Glendon French

Thank you.

Operator

you. Thank

of comes from Wuensch next Our Citi. question Joanne

line Your open. is

Unidentified Analyst

afternoon. on for about commentary has like you physician Good give is any on pipeline the and just training Thanks Anthony early just question. talk taking demand maybe what actually This been then our for Joanne. Can like? general what new Thanks. the is training facility at

Glendon French

Demand.

been up. have great, it's things We been it I think. - opened So

I think think, the training facility new today, I class at we're doing Midwest. that a in

up. that think since done it far second we is so that I opened our we've have

who's The a first that has all the the first running elements, the program ranging spectacular to to very all returns doing from is it the been very, the job presenters was guy training that and positive. from program hotel

doubles So, effectively capacity. it our

I will - that we twice many we have training a was second think happen through people well what run center. likely won't now as

we'll order. think going order the something classes is what of bit little other a on probably be smaller, on just we'll make every and we'll the I do that to week, something happening

job. be So clipping the capacity I spectacular along and a said, to new sky, is have center doing we'll it's like this in great this new

Unidentified Analyst

Great. Thanks.

Glendon French

Sure.

Operator

Glen to any you. at back remarks. showing Thank call the turn closing time. like French questions for further this no I'm I'd over to

Glendon French

very Wonderful. Thank you much.

in with pleased of first of the in the the effectively of light for difficult very performance In was half quarter. first same Omicron the at about, quarter every sort was I first us market talked we've very time. just our As very, this, with hitting

things we we summarize we to with we of don't about those give technology, scaling great look in get faced Having that, Number increasing. the steep some anticipate a be But the the that past of treating given ahead ourselves. ahead. we a I'd optimism is some As challenges very medical want of to centers talk we new revenue that along quickly us that slope. deal of look as just go that ahead, like or sure very said of and

We centers. looked fourth practices social in activity. up best you patient have XXXX number treating trained of were of of fourth of you sharing into at an interest, it focus increasing didn't the shut the quarter, treatment across down of compare roughly XXXX, process up, awareness concept where COVID place down with to quarter doctors for a first then and patient connections central quarter, of the marketing as our inbound media this treating option We've a our first first And us our to we're were in quarter got When relative referring physicians, quarter. finally, shut calls but half and sales our interest. it centers

more We of two-way have And opted of than have opportunity for center, now single allow in, treating physicians. XXX,XXX a which and gives patients forth. off go to we've patient-centric call-in exchange that back with this point consistent kicked us which information will contact our that

right the and great in have toward place deal that's we believe in experience a a with a team working plans we those great place of reality. So plans making

Pulmonx for I for to in time your want today, all just your interest thank and good So you and afternoon.

Operator

concludes you call. you. gentlemen, this conference Thank all today's and Thank for Ladies participating.

Have disconnect. a now may You great day.

Pulmonx (LUNG) 7 May 222022 Q1 Earnings call transcript