Earnings call transcript Q4 2022

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Operator

Good day and thank you for standing by. Welcome to Pulmonx Q4 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers presentation, there will be a question-and-answer session. [Operator Instructions]. today’s being that advised be conference recorded. is Please the to Gilmartin your would like today, over hand to at I speaker conference Laine Group. Morgan

Laine Morgan

for operator. thank you afternoon participating all in Thank today’s Good call. you and

Pulmonx is from XX, Derrick quarter a release and the the on and press Financial Executive Chief announcing XXXX. its Pulmonx of website. me President financial press and are Joining Sung, Pulmonx today, fourth December A Chief the Earlier copy year Officer. available release ended Officer; French, released for Glen results

revenue, organization, operating of opportunity, timing for the cause impact implied and or trials, various hiring, the actual Before management, and on contained anticipated in will could Litigation I the to the recovery, our which our call forward-looking forward-looking risks results product begin, that I’d laws, like materially of assumptions. to events Securities pursuant within make that expenses, from upon uncertainties Safe are business future remind strategies forward-looking these you those growth Harbor All statements pipeline those and meaning commercial without management securities made our of clinical call this of predictions expansion provisions and or relating federal statements operating of Any performance, development current this statements. These during that and to or are expectations Private including, estimates commercial prospects are for include based material statements Act expectations and that results statements. the performance future and to XXXX. guidance involve events, or our limitation, for of by differ financial gross COVID-XX margin expense statements in forward-looking statements, results relate Reform trends, market to

Accordingly, not undue statements. place reliance you these on should

Risk quarterly on Exchange risks the filed description Form including the our with the our section refer business, our please November uncertainties of report X, to Commission, list with Securities a For and with SEC Factors on associated the of and of filings XX-Q XXXX.

certain discuss financial This financial are the these results. of accurate February events are intended relations most our financial Also posted non-GAAP during and contains today, the comparable which GAAP any measures provided measures to in or Reconciliations These as forward-looking XX, be release of website. broadcast non-GAAP any our future investor to call measures. otherwise. non-GAAP revise measures in or GAAP will not or a substitute XXXX. intention law, disclaims call this new Pulmonx conference to except information, the press is we time-sensitive directly obligation, is information financial live or required projections because whether only by update statements, as of for

Glen. I And with call over will turn the that, to

Glen French

Good call. afternoon, full and everyone, our quarter Thanks XXXX fourth and welcome Laine. earnings year to

a Sung, our year is with full begin me before Here Financial Derrick highlights with Officer. results outlook XXXX our to fourth strategic XXXX. Chief priorities few contextualize and our for to I'll and quarter turning

treatment us after Valve intermittent procedure establish a a to normalized in for sustainable environment growth severe to our resume focus finally foundational standard-of-care with for of more developing of the emerged we allows years the than Pulmonx, accounts our into long-term was XXXX that disruptions Zephyr which as for more COPD. on basis patients building two with a a year

initiatives. commercial progress business growth million, full XX% achieved made we U.S. a delivered we we representing on over XXXX. constant For XX% also of worldwide on XX% basis reported million of XXXX XXXX, revenue currency $XX.X clinical our year and XXXX. full the On top of in over $XX.X and in this, as sales year our growing substantial the Further,

we And this focus footprint thereby increasingly we to base Specifically, as taking our total new development XXX a our commercial XXXX, centers, training account and in on increased and centers. penetration. U.S. solid XX adding provides

saw a successfully to patients on-going our AeriSeal study Europe, the lungs, center with convert encouraging with thereby multinational multicentre between channels in AeriSeal be collateral feasibility We allowing trial close and clinical Zephyr air of in that technology, early treated Valves. our single can signs lobes data on Australia two readouts successfully both revealed ventilation

another of sales XX% growth million, million of our in $XX.X year. $X.X sales we approval year, Valve date, received the off record establish regulatory quarter quarterly lastly, by over Zephyr same with there in for Japan later the performance are to fourth reimbursement the to highest revenue presently ended last global we year. And our driven and procedure working cap this representing To U.S. period

continuing Looking ahead, is in focused our routinely and efficiently are done hospitals. on procedure we to our ensure target

in the some will in year, our high the growth expect half this these potential full substantially headwinds Taking seen efforts, anticipate this these progress, revenue in made XXXX to into that confident we we push continue these translate initial we XXXX headwinds. in be in to increasing ramp of to of the and our to We've into $XX and million to macro through year. our to to maintaining million. efficiency good directly continue ability intend back account, are While this year range of expectation revenue accounts $XX

accounts strong three to based Valve is have criteria be selecting, As believe our first, Zephyr pronged; reminder, assessment we centers. training on launching a that our comprehensive potential the strategy and

procedural our capacity Second, with the and of champions. and physician our efficiency accounts by encouraging practices administrative increasing best

building emphysema benefits volumes both the of a center referral Valves physicians finally, them Zephyr increasing awareness who And with of developing and substantial the manage thereby patients network. local by strong

XX the were quarter, to XXX. total pleased our number new launching and bringing fourth trading new U.S. assessing in centers to we add to Relative accounts,

developing additional expect developing excellence. and new program focus accounts, into clinical Valve These to XXXX year. high remain selectively an and XX While the accounts this committed our will identify a through are establish deliver comprehensive accounts volume will to we that cohort be to on throughout to efficiency Zephyr XX

centers increasing across our a and productivity trained activity of U.S. to that our base account the account treating accounts centers. treating will as activity revenue efficiency be place that progress sales metrics best order believe a given generating in we forward, We define percentage quarter. and the existing Looking and of measure

of the environment. which to account resumption quarter activity in pandemic U.S. level represents In a a was post more activity a of fourth XXXX, XX%, normalized

activity of Valve We in expect that and which Zephyr that continue of treating and wave range conducted the given of range are revenue most our and quarter. as last centers. established active the will the our a We COVID productivity average Valve by from the account recent in COVID quarter. XX% denominator the account active treating established three a quarter XXXX productivity centers, performing emerging Zephyr accounts have remain our cases procedures of as quarters generating grow been average cases those pandemic five the number subject four we least three -- for have placed define at the order to per between After in across quarters in

established most active XXXX. measure metric our half in established expect we in the increase as to specifically, success account account our see of active as accounts critical approximately strategy and by We development fourth this average benefits which our More X.X account the was realize productivity to the cases see the refocus in quarter of the of year, from second initial the the productivity strategy. and

the XX year with Importantly, existing our this and end territories, we can accomplish XX at in of we footprint feel our which of consisted U.S. strongly that commercial year internationally. sales goals

Valve to expect Part this productivity we we resources procedure the continue Zephyr focuses tunistically expand of among target to that and and initiative of While to geographies, sales physicians. and can effectively our are add markets. cover operate select COPD building confident of our on awareness team grow benefits

To on are American this engagement seeing of Zephyr with Valves physician and are to already end, strong and Chest Medscape physician programs pleased College to these -- Physicians have education launch we in we're programs. partnered the

the to of these Zephyr to expect efforts our COPD partnerships Valves substantially with emphysema physicians to collaborations. how We their with awareness opportunities and to advance incremental for these may we improve and continue to increase patients intend facilitate lives look COPD on

believe tap billion be we market expand Beyond ways to to within markets, further $XX a these continuing initiatives to and global existing what into are we pursue opportunity.

last end, we this Japan for treatment regulatory received in our late year. Valve For Zephyr approval

market and patients as who commercial reminder, which toward to our this Also, a be is of approximately benefit late Our team Japan, year. subsequent we XXX,XXX a now stand Japan expect establishment estimate reimbursement from with the working we diligently in introduction opportunity billion the to market dollar treatment.

ventilation. COPD Further, way with number Zephyr we a and Last with market continue collateral today of the with our ventilation treatment large addressable These in patients with year showed no the to AeriSeal regard for expanding were an on not to who candidates successfully as first then having to trial, severe collateral to to AeriSeal multicenter view leverage are Valves. possible on-going multinational interim findings converted Zephyr of XX% successfully little Valves. patients our the study from XX treated patients CONVERT

trial with year. FDA an the year, to enrollment final dialogue We year. presented of initiate contribute expect IDE this with to data CONVERT learnings related we the expect before our and Also protocol from regarding to trial that clinical end complete this next

I'll quarter the call I'll a With to now results. over more turn that, now our Derrick turn of fourth review detailed to provide

Derrick Sung

basis. of prior Total fourth an million, we sales and increase Thank our ended period. environment. million, worldwide the a revenue $XX.X same year XXXX, adoption in U.S. into commercial XX% high $X.X from therapy a million the $XX.X a in of constant prior move quarter growth the reached was from a December $X.X afternoon of in a The three the reflected XX as Glen, everyone. continued XX% currency revenue more the million XX% of stabilized good you, on and momentum new Valve during for Zephyr and a increase months record increase period year, U.S.

constant quarter last fourth as of from negatively rates. currency million X% million, and revenue was International same during impacted sales the year, by X% was decrease basis, $X.X on the exchange currency period in XXXX a growth foreign $X an international of a increase

a margin the compared XX% in was fourth year period, lower rebound for the that our in reflected we international summer capacity certain quarter XXXX Gross fourth from third markets. slightly the Notably, seasonality during prior reflecting quarter performance the more experienced quarter pronounced XX% to utilization. of

were of XXXX In expect fourth the the $XX.X Total and to the year. from near increase the fourth then a a expenses within towards in in range for half half XXXX the of from the the of -- of gross remaining million, year, first to in $XX.X margins fall quarter XX% million XX% XX% we XXXX. XX% XXXX, increase of XX% back operating trending quarter XX%

stock-based Noncash XXXX. in compensation $X.X of expense the fourth million quarter was

total expense, in the period same increased expenses of prior the stock-based the Excluding of fourth from operating XXXX, compensation XX% year. quarter

a to of noncash to disciplined and expenses $XXX million to million the operating $XXX between inclusive to stock-based expect we to take ahead, of as Looking compensation continuing million, expense invest while for $XX fall approach drive year expenses prudent full growth. we managing XXXX approximately

Excluding increase XX% noncash grow stock-based operating expect as X% leverage compensation expense, meaningfully an in our than expenses demonstrating our year, over in operating to rate prior operating XXXX to implies operating guidance cash lower a expect the increase to we revenue. at we of expense expense

expenses an to an activities, compensation increase million, $XX.X million in quarter compensation to R&D to we primarily as of commercial of year. quarter attributable quarter expanded $X.X compared and to in the the our as for the team of the XXXX. was in General XXXX fourth was period compared commercial prior as marketing million, and in for in of stock-based sales were Sales, increase the attributable expense. well expenses The million XXXX increase The stock expense. same were based and administrative $X.X expenses increase fourth an increase increased fourth $XX.X primarily

witness of XXXX $X.XX share to share the fourth compared as determine period same the the per prior was of XX.X shares for million, quarter million of used for loss fourth loss share, loss $XX a count of An of $X.XX year. average was per XXXX. or or the $XX.X loss quarter Net of per net to for million loss share

interest, amortization is we Beginning expense. our of expense, taxes, operating noncash of this before depreciation the net excludes quarter, also reflects we performance compensation Adjusted believe on-going stock-based EBITDA, EBITDA which business. and our adjusted reporting representative on will be and loss

September would XXXX. Adjusted fourth EBITDA of of XXXX quarter the XXXX, ended million, million XX We loss $XXX.X the decrease by the Earlier advantage take flexibility million million. December compared ourselves on strengthened felt million of as balance to our loan, $XXX have financial with greatest total XX, was to our cash, marketable the drawn the $X.X from We the a loan securities, it XXXX. the recent amount drawing cash our down our remaining been in to invest by bringing we sheet week, equivalents approximately the to of provide cash existing XXXX and further this credit provided for million. Including in quarter this $X.X of term $X.X million in fourth $XX end of to favorable $XX business. prudent degree position this at terms drawdown, facility of with

in As rate we attractive with drive that a credit this expect line breakeven confident existing on with date leverage. reminder, our as burn extended reach the to the to of October and X% prime operations years can least that and X of we we interest-only cash our remain additional of X top plus years, hand last facility in current annual we cash capital flow decrease our grow at recently an and have operating refinanced another year payments. out We maturity at continue

revenue to turning Now outlook XXXX. for our

year to full the XXXX in million. to deliver $XX We $XX revenue range million of expect

assumes on an half growth to in then relatively basis, year foreign of guidance of the headwind back currency tailwind the remaining will foreign rates with to half a growth XXXX. exchange a neutral in the and annual exchange Our be to first transitioning

We year, lower seen the we've of sequentially in the past. in than quarter be as last expect the typically XXXX to quarter of sales first fourth

we to for demand The False anti-kickback Justice received and U.S. that I'd information in with request Lastly, request in Claims information Act the the XXXX, like the under mention civil of December in with services. CID the Department a the connection from related sales Claims statute. and We statute and Zephyr applicable connection laws fully to anti-kickback are and compliance Act and investigation. products of this other procedures False the promote Valves with and cooperating regulations policies with maintain marketing and investigative and

or of or I strategy. that cannot, would While matter, commercial we our growth as this time, implementation this we duration outcome the to the to not emphasize reasonably at hindrance this barrier a view time, predict do this a of at

now that, with turn And I closing call comments. back to the will Glen for

Glen French

a strong and efforts summary, new particularly year. in the growth of forward We before look with to build selectively back year selling adding our Japan team delivering product refocused in In remain end we on Derrick. addition half to Thanks, scale to our the as we commercial in while momentum XXXX, start the our accounts, ones confident efforts in in also to the strategy. of

Valves expand who candidates benefits the which target We offers also market an for the look forward possibly to of development opportunity patients to are currently to procedure. significantly by progressing AeriSeal, the offering our not of Zephyr

together, strong expect development Taken to and execute commercial XXXX we on clinical beyond. in growth both objectives and deliver and thereby

to we thank With all for like call attention, open that, your for questions. Operator? I'd now you will and the up

Operator

Our of comes Thank of question Rick Wise from you.[Operator the first Instructions] Stifel. line

is line now Your open.

Rick Wise

big see everybody. Maybe afternoon performance. to quarter Glen, just picture front. Nice good off to Hi solid the in the start fourth

that macro environment fourth strong about and that notion. supports the talked You improving, the idea, quarter

year now going so? to that challenged you're the improvement Just you're that, XXXX? last or to you environment or up help over to confident good do feeling you're able macro obviously another that do or to changed, you why us understand year is able more set in well have what's by good what why weren't And

Glen French

the Appreciate Rick. Thanks, question.

And thing that's that or at I time, changed, the So we I minus about just the year significant all plus week thinking essentially significant of hitting X. markets headwinds, same all impact. mean, a XXXX, with a our was or COVID negative the with basically started had

has at world. rebound progressed -- I ability cleared for different that really the year, rebound parts our the us that, the of had slower than as Outside States. what different we slow And was across United albeit in from the rates United fully in to experienced States, that we was think,

a cleared bit. that's So

The challenges. the other that real we in We those some is talked staffing last call. about had thing

to Some of just into those of were people getting their related back seats. sort normalization and

take the And able not to third some a the to time of for extraordinary to were X those, as being we part in take folks vacation. years talked about related after better quarter, opportunities of

that we so ahead anticipate that types don't impact of extraordinary as regard. felt look quarter. third in We And we the in

talked whereby And we ever the opposed us without really able we identify we around quarter another, COVID procedure or a their first which high-performing as in X we things able were the the all procedure were accounts getting or our appropriate in place in the were we to as in assuming hadn't last to was maybe moving our to being -- efficiently. call, about had, time more set a is accounts. weren't cases, as direction we and knocked our problem. up as classified some stood routine for was able the And about of the then particularly better United the of the our as one that routinely where in to that COVID, in with established months in talked accounts call, a we we that account and finally, and last part and, of one the into we goals made process as offering that States, about fact, to them think revealed of specific And quite when was then more set being execute I hearing consequence,

us faced, just things year. into with plan all place, I are the particularly a year be that coming whether those without last that in or think headwinds first the into better this the we had part So put that of

Rick Wise

that obviously, your If you on accounts XXK correctly your clarify XXXX, X% X.X hear that we you're drive support think better you And the that's Or as top right you. X% your can did well. think range? I in was was I productivity, quarter? about quarter saying I to the there into a Got productivity I think just it. that and is get all am down the it and it could correctly, wrote On fourth for get your doing account account average correctly, Anyway, to about And maybe about way performing? efforts talk But to the if training that. we maybe average. you'll

Glen French

the Yes. year, account -- Well, our across was so XXXX the had across we productivity quarter were -- we first X.X. number

So started first we below the in quarter. X

the sort exited year the are midrange of the X.X. second quarters, range We at and X.X in we X in in the

X the through across to this about expectation that do So yes, is range plans had we exiting to were executing we'll the year you as X it the our X will X about. the talked this And on range, in we And year. that we before. in be talked

is that. training And central to

that on-site So best variable ensuring terms sharing move decrease our so very that a of then be the which patients whether takes, the are sensitive and to will. that the time training centers able sort from you if to practices in sort of to ensure the efficiently door front equation, productivity is the in it doing procedure, themselves of

itself, think we have training but that we of may we modified -- calls, folks on the And bring maybe training. into one also these I have talked way not the

would are then the were in coming we relative bring more data to of to that prior training the to and committed they face-to-face on come couple that immediately say training much physicians talked years ask that about training. X information are patients forward more We engaged. where to are a out and of I So that scans ago, them and much

world by we other good X the and face-to-face somebody aspects physicians patient nearly X front execute a back for going procedure scans virtual and expert we that of various procedure immediately all that the terms with room in them then volume the at training, room experts do is COVID as not And those doing doing through which to recall are as the X is of what and then X, procedures, go going standing times, the the for assess which in may along look of with having to ask to and like or were reviewed a in how You metrics. procedures. day reduction

come getting very a for off of out months to the are days, X And training wave speed, they the sort patients. And would treated they’d very, them physicians doing they their of patients. knock them those conversations it and COVID in before first And quickly. then in looking those and valuable balance, start bringing procedure could up COVID of be

we So that’s we’re to intend getting more folks for quickly, engaged drive the backdrop how essentially and forward. this much

Derrick Sung

this Derrick. And is Rick,

for from Let an to that for account clarify few their It when case. quarters to me a just the takes speed definition get productivity. using up account first they we’re do

we’re and look So when case looking Valve. fourth up implanting their our that at least Zephyr accounts given that we have we’re done in only productivity, quarter. have actually X quarter accounts and looking And for of account those in quarters. measure our a running at They’re been at also at that

So our number isn’t diluted by inactive accounts.

in that active have of least numbers we the active the year established And the in half to for that and number the exit Glen up we X those given refer back the productivity do gave range -- account through to quarter. to up that So running of quarters accounts that to a of X been as move sort X range and or at X X year. indeed expect those into

Rick Wise

Derrick, a yet I you. you little margin lighter And gross me, could. your Could little comment? had lighter and record Got you last for, were on guidance is and looked if your a margins expand than I volumes. Gross from just,

little Just little and a are the it, to gross ditto than XXXX? lower earlier maybe ahead color year for margins why Thank more you. missed a they were in I on look the

Derrick Sung

Rick. Sure, Sure.

be terms that first gross term. current inventory our to and we like a kind in lowered the given margin in of where look levels in safety we we in of of XXXX capacity half slightly near and stock, for reflects outlook output, now production seeing reduction -- as utilization demand we’re or as of slight feel that of we’re coming want that the last quarter year in fourth the year, this So into

will we year. around production year again up And once output the into of stay and to into then our as And as beyond, of we’ll that expecting we’re back to we we up to year over half XX% in land reach next that start we of our production gross range. to -- range half believe next long kind margins as ramping term to meet the continue to as the up our continue XX% we So ramp range scale. and year that high the and first demand, move move that expect and that expect this in in output that XX%

Rick Wise

Thank much you so Derrick.

Operator

wait you. Please while next we Thank stand our by for caller.

comes Our next of of Bill Plovanik line Canaccord. the question from

open. Your line is now

Unidentified Analyst

Hey questions. past, Derrick, of it's Thanks little Glen In for the that as workflow you us bit through on and a today to give do those talk flow bit Where reps you’ve number more Or our more the accounts the to John are [Ph] how on highlighted just for a this Are bit little well. that XX does Bill patient more taking with on a just today? process? accounts you those tonight. you’re Can number going XX with struggling stand do can work year? And going details accounts? Thanks. processes? help just to efficient that you how hire you

GlenFrench

heard of me. It little that I whole you a don't was if you that. know question? Derrick, choppy Did get for all

Derrick Sung

Yes.

high where are percentage be them to are we volume like want where driving So on I to you’re kind John, not as accounts so asking to as think, going be? of we how -- they and -- percentage of sort to, those want to what focus accounts that get John asked what our we are was of

Unidentified Analyst

Yes.

Derrick Sung

Right.

of be they’re an certainly would can where additional would question. we’re your that approximately to and well exiting kind feel by I doing be. consider we And to paraphrase really them get say accounts that of So there’s really doing accounts. focused quarter we roughly I of start I range on. – think of year, group accounts our kind They’re want a the saying we what maybe speaking, to would high-volume that’s that today, are into

product a hospitals. making kind was in prepared new what up Glen site we’re focused is this up had we’re procedure is what routine, setting service his driving And which remarks, line the we’re efficiency, during or these setting mentioned, on the procedure that in exactly of that new which

and a functions we efforts procedure at our really procedure half across is really share And really hospitals on, to focus to efficiency in we’re positions routine the those so first coordinating are of the and adopt kind this going focused multidisciplinary year. kind that through driving mind training and be get the to as of the our of driving site that's what

We expect our to force. be to able existing with do that sales

hospitals So this not It’s going was -- believe share and to this sales which our we’re routine and in your just mind focus part of significant opened. second XXXX, require the increase those really isn’t that making through a force procedure I of of question. kind we've efficiency a that amongst anticipating already driving and

Unidentified Analyst

today? you and to end launch for questions. the to of Thanks, the be hear our Derrick. Thank ready Yes. do infrastructure And still taking team add you year? Japan launch preparation, there what on size for what’s And if you could this question, just this too, need

GlenFrench

Japan shape, pretty I in Sure. Absolutely. as good We're goes. far think, as

for us at a and in has on leading who joined way We have a executive been X -- board been joined the general have about place us Medtronic manager senior months.

of clinical marketing a a person have We type marketing person. sort

offers think a consultants I experienced need a of to be. from where begin perspective. clinical We’ve those we’ve extended deeply representatives they couple of to significantly get regulatory a leveraging been couple sales and to accounts to

with. do partners to that got working have been be identified their personnel have through post-approval clinical own we’ll to going trial. that traveling our You’re We’ve a

we relates we’re or number point. at this -- very as we’re, of have just So functional folks both it shape we’ve and about good -- the in sort frankly, that to expertise bringing on that of the

Unidentified Analyst

Thanks.

Operator

question. our for standby Please our you. Thank next caller, next

Steed comes BofA Securities. next the Our question of of Travis from line

Your now open. line is

Unidentified Analyst

Hi. [ph] Travis. on for This is Ian

February U.S. million a if $XX U.S. guide and It around additional any you And I for implied Just impact. had for growth, little a then the on QX OUS COVID $XX here you expectations possible. think versus bit faster hoping little then almost the OUS. OUS? more had looks to said like in previously a through get to detail What is detail given XX%, QX, was here, slower. XX% year, the million last U.S.; that

$XX.X the here? right I Is around for the is Street think QX ballpark that at million. in

Derrick Sung

Hi Derrick. Yes. I'll and those is this Ian, questions. go take ahead

of about on So at sales is in to to year-over-year guidance guidance. breakdown of I our sales U.S. that to guidance, the at do grow relative XX%-ish midpoint, with think rates last our coming million terms end we're growth XX-XX the does roughly and If in meaningfully XX% OUS, continue communicated the XX% directional international. kind implications XXXX, the of think to $XX the which basis given of same between faster from the for of from million imply than business over We we our U.S. growth the international. kind mix the $XX that of U.S., expect sort remain year of coming we our about high-level a as we'll

U.S., the XX% think, we're in So to I range, to whereas U.S., at range. in that outside XX% XX% grow the will XX% something the looking

So your answers question. of the repeat part question? second first of that the your think you is that -- Can I part

Unidentified Analyst

just detail around additional any Yes, QX.

$XX.X I million. think the Street is around

Derrick Sung

Right.

QX. see do typical sort we expect in to seasonality So sequential of

the folks holidays U.S., oftentimes in using beginning And -- from a a up up XX% the the generally of we’ve year. by there’s That gradual sequential on hospitals lower globally, of U.S., see including end historically, than are sales basis the ramp QX. that that their year. seen QX then are the off driven come the to budget So typically near anywhere XX% -- outside the the we as

time of typically more during was seasonality but the decline. that back the into kind if pronounced pre-COVID see do period, of sort look we COVID, we sequential that Now

-- in see that seasonality that would typically U.S., will see would reflect in range seen more of And see than think level both we’ve QX. expect I sequential to that past. international expect I I as historical something but of the range, So the to in decline a again,

Unidentified Analyst

maybe Okay. Perfect. international. And on then one

there expectations ramp year? in could that is potentially how you? Japan, year? around next Just year? just revenue later this early large for expectations How Any business numbers any a then of of terms around a that fast And this rebound China,

Derrick Sung

Yes.

anticipate we’re of year. that get we going to regard approval the with reimbursement to So -- or we’re later Japan, part

get do after I get it we’re patient. I going to be -- some that our expect to treating and running. first approval, we’ll day takes the up don’t time So things think we

think, So well. patients we’re we’ll if this of year, get doing in a handful I

material So by Japan. contribution year to revenues I expect any don’t this

other clinical is Japan trial. that anticipate thing XXX we through likely to run first are a XXX the The to have patients all to in

So be X probably centers. we’ll specific XX Japan up or opening through

to first knock be I doors they I so they’re of are anticipate not the revenues that, – off this bend year, way that next expect year going in to of dramatically an those and into stronger revenues of terms enroll OUS in the footprint And in move going off taking curve are our the will though the than when opportunity that. to XXXX revenues. patients had don’t we’ve those and see our really I off expand study

top probably -- X that our think into that’s that I certainly getting for we market as way a being Over would the think about I So see us. time, opportunity. that

Glen French

second the right as as was And your China, million less -- China far for now. $X part around us is and and than I question think of

Unidentified Analyst

the Okay, taking questions. thanks for

Operator

for standby question. next our We

Our next of Piper from question Sandler. comes Bednar the Jason of line

Your line is now open.

Jason Bednar

number yes, year Thanks questions new maybe little Hey seen bit we’ve in afternoon. you’re to on-board is below below the years. -- of the Glen here. looking for what past accounts Derrick, or good a this taking

probably that’s of probably, function you’re maybe where of a lot on think a at your target boarding I accounts.

What with take efforts be give return this reps for expecting their as I mean refocus focusing time what on being account the sense. maybe on new lower us look to you Are accounts? the the towards accounts Or like spend existing driving here shifts? your could you turning makes during does day. your time help emphasis with reps and more of and account think your additions in reps productive how higher existing and on productivity, their ton As your the versus a the of like terms shift

Glen French

the we’re with And what reps thing that new in -- asking has been is It’s new we’ve much Yes, to they’re I do. really fairly central that the accounts terms numbers procedure adding new we’ve doing the more exercising revenue accounts never that the where the what shared follow, organization gotten -- never dramatic. and that accounts the a from get opening where place much to need efficiently see what revenues they’re sales of think it’s of these of that organic more to accounts. you to fairly routinely And is point we routinely. that those and and this is to is that that been have

moved not This page us, So They’re that to to the United on That’s around we’re opportunistically. continue sort on. new -- not real is same the telling focused accounts. hospitals into page. are for in But open the same we going do of folks halfway targeting here. we’ve that same-store that’s here everyone’s sales. – as the – is now is opportunity penetrated what on And to we’re we’re past States, everybody really the

do We’re anything. forcing anybody not to

people We’re possible. makes to that’s number the that everyone. make the available to And to technology trying most path greatest the this sense of

are So at this focused that’s folks where time.

Jason Bednar

maybe and seeing dynamic? a may more throughout XXXX those Germany but Okay. a the U.S., we accelerating you’re accounts and markets. there the notably on basis? in proportion sounds there’s in see It those make constraints that in almost you should that about lagged franchise? like That’s XXXX, mind international be you. Germany Thank in are talk Do mimicking Europe, part other still effects helpful. France, and your some this France, recovery have Or particular, And of markets can then of in could for trends capacity you maybe which

Glen French

X in about the to been XX% doing represent our of And with business. ways, two regard big on basis the international the Together a U.K., our the execution X way in U.K. France are of leading global countries the thirds -- is the big strategy some they Well, to international that Yes. Germany, and the we that a rate do grew States. year. to mean, into look to anticipate going the talking continue last They and high they’ve We we’re a they’re they’re great, at United I employing as going year-over-year. grow year this for while.

-- sort year much U.S. soft last that the a after had of with had of France slope was initial adoption year. the of upward a remarkably an adoption, very the slope curve a consistent

to expect curve. steeper on get of back that We them sort

things expecting to us, is France year. this France of I outside And States be the by the out surprised market heels one I’m good wouldn’t if for year. really Germany’s so this be perhaps nipping of number United And at the end

Germany So goes, are got as as good everywhere activity, marketing on commercial. good we like we’re fundamentals executing else. far We’ve the

we contributions of to to U.K. that in are and as a same France year. markets, I Our plan them I grow But I’d the of the ahead expect of Germany. sort predict the well. If sales other percentage all three and we executing make basis, put to across activity, amount significant we’re on expect game the had growth probably

Jason Bednar

Thank you.

Operator

I Okay. to Thank it back French closing turn to would now Glen like you. remarks. for

Glen French

a very procedure. for feel as opportunity everybody remain much executing access seeking there. We like appreciated. to large. your the we’ve that our It’s it. This We clear. the They’re on. opportunity access got questions. you Thank The the very great is procedure. They’re on confident we’re information They’re seeking well clearly very, to as are in ability plan patients

are data They’re compelling. consistent. strong. Our They’re

sorted out guidelines. all our We’re markets. major Reimbursement the included of in global in

enabling care negative reversible our And view are the working we the on our standard population as we’re doctors of the large patients, folks that ventilation treating today our Zephyr Valves the candidates are who expand are procedure. as addressable are not severe with that and expanding indication to total These Japan into and procedures. us collateral treat working procedure through with well patients. emphysema Our a market of expansion geographic for as to doing both AeriSeal

we where optimistic And to future. gotten the the everyone’s call. of any end think questions, about short, appreciate -- additional that remain have people we’ve So in We the I interest. very given unless I think

Operator

Okay. you today’s conference. conclude your Well, in the participation for does This program. thank

You may disconnect. now

Pulmonx (LUNG) 22 Feb 232022 Q4 Earnings call transcript