CUTR - Earnings call transcript Q2 2021

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Operator

Thank you for joining Cutera’s Second Quarter 2021 Earnings Conference Call. [Operator Instructions] The discussion today includes forward-looking statements. These forward-looking statements reflect management’s current forecast or expectation of certain aspects of the company’s future business, including, but not limited to, any financial guidance provided for modeling purposes.

Forward-looking statements are based on current information that is, by its nature, dynamic and subject to change.

Forward-looking statements include, among others, statements regarding financial guidance, regulatory approvals, productivity improvements and plans to introduce new products and expand into additional geographies.

identify safe we press harbor today. may refer you release that the to statement words forward-looking encourage statements, to earlier For in our forward-looking Exchange in filed. our uncertainties, XX-K as XX-Q risks in All subsequently the section updated Form subject Securities on with factors Form and the Factors those and described and Risk entitled filed are statements Commission including to our undue they reliance of also made. on statements, to cautions Cutera as date you which only place the are not speak forward-looking Cutera or undertakes update to events. publicly any new information, forward-looking reflect no obligation the unanticipated statements events to of to or occurrence circumstances reflect Future results may expectations. differ from current management’s materially

a non-GAAP Cutera’s should would underlying results performance our to by Mowry. will reconciliation Cutera operations, GAAP turn the an Dave Cutera financial measures addition, operating comparing With more adjusted ongoing The measures earnings along release. over In particularly and call the when basis. facilitate as these complete to transparency greater to to, CEO, not I results that, non-GAAP results analysis financial refer considered from but the of GAAP. be into measures, including believe from on can financial alternatives discuss our measures like Please period-to-period. prescribed in to non-GAAP with, measures

Dave Mowry

XXXX call base I outlook around XXXX as our before joined well we Rohan the period. the providing well to quarter brief then Then comments call by he results. trends, today’s Officer. a as questions. for me call the final financial a our energy turn some second after on will will call by which performance to as the I results, of the back over for Rohan from of details open I Today, of provide remainder share highlights operational aesthetic begin am our the business view Financial Seth, as our will Chief overview underlying share market our to few will

quarter second our Turning business now results. to

as XXXX cadence the During the revenue anticipated, an quarter above based performance. expanding business our appetite Total steady energy strengthened an XXX% end the commercial and slightly XX% capital the our revenue improve the markets. in equipment teams by and both quarter second sales across and increase volumes growth during in net our execution XXXX sales second in for to and notable aesthetic equipment ahead largely $XX.X was in Notably, quarter continued quarter to normalized of history $XX.X Cutera's our XX% our of and markets. developing purchases regional sequentially XXXX as expectations our over and driven second of business. was of despite capital pre-COVID year prior the levels. the variability corresponding single results XXXX The nearing revenue improving treatment increase domestic This best million quarter increase international for million, global drove pre-COVID of

on accommodating We Commercial efforts our varying our the specific recovery executed around plans revenue teams COVID the customers are over uptake of strength across at pleased efficiently their equipment focused to our sequentially accelerated continue building as different around capital quarter region platforms. stages world. see

sales second in by were normalized as markets global and move XXXX. equipment more growth of half Well, will a driven and efforts from we our in sculpting of first the capital North to spending especially our addition quarter delivered another quarter regional return were improving basis our pre-COVID for pleased the face Cutera's products our the we to to sequential seen XX% rejuvenation skin bolstering In strengthen markets, capital America, Zealand, XXXX In highly as through volumes team's procedure yet focused direct GAAP we that Europe. have Australia, the the positive confidence have completely capital close of as the and in equipment particular continue On metropolitan New in over to America, a from pace well XXXX see to density been sculpting the trends North performances environment of to am body of sales routine. this body coverage as business, several they we the with the sales headcount America North in pleased team's generally I levels fueled areas. have key expansion, our in by force improvements, increasing investments teams

performance work the equipment deals. count build increased will their rep to pipeline half as expect drive capital that reps second help late We XXXX of newer

aesthetic summer that the awaited We there the of patients volumes vacations. some to also family anticipate practitioners be course will based and long late America as mid over energy North in impact take

While allowing and and will returning more practitioners are sustained this aesthetic traffic we and aesthetic particular breaks indicator activity to of fatigued somewhat the this do normalized market. routines them time impact the the these based plan as the term long to positive a revenue more predictable term and see modestly energy away. as patient health more overbooked confident planned of near in growing are Patients

for pattern For this its years, our will company a and those industry who followed you regard of reemergence a as will concerning of rather have recognize period than in healthy you development. this seasonal

Australia local reflected the second and of by forward highly previously XXX% from marketing was great equipment And expected event attended Cutera Our believe a past revenue University pre-COVID practitioners. deals half in event staff. performance XXXX standout The with well event quarter productive Clinical our This over that delivered a customer XXXX support followed Australia, from in capital exceptionally Cutera that portion pulled for The our educational May. sequential Forum New second deals likely quarter of in XXXX. team was this growth Zealand we sales or by Australian run were levels. XX% aesthetic global result Australia region second CUCF growth

levels. and the of selling capital are quarter reflective quarter equipment in sales period result, on ongoing pre-COVID a processes. year from results contribution the sales expect Cutera's equipment focus These prior Australia sales teams capital investment we European and over our Europe XXX% see the of in XXXX, capital XX% corresponding talent, XXXX but second grew small over quarter dip equipment In to third As renewed XXXX. during in a revenue second

to of recent that similar expect lift we in continuation are see fourth slightly of both queues and to of the North schedules America, holiday We we half traffic strengthening leading dissipate and back additional into may to and are seeing entering trends patient step while in believe the treatment a the some XXXX investments Within will treatment and quarter these a a return volumes period, normal that provide Germany Europe XXXX. for second XXXX. act positive

demand fourth quarters volume treatment third will and XXXX. to capital improvement the over lead growth expect of We

over recurring year. XX.X Regarding representing the second million maintain quarter positive the business revenue, XXXX of momentum XXX% of growth delivering prior in

quarter the and categories, revenue consumable all our robust During products, contributed service recurring skincare, year-over-year three to growth.

up across quarter XX.X Our of revenue million year skincare second period. continued with business reform over the XXXX of XXX% prior to

was market performance the in prior growth during revenue confident year. product sequentially delighted the Japan. XXX% from strength with U.S. our volumes the our slightly which XX% took over and June. which treatment both very consumables within in million resulted $X.X of in in Revenue first a represent markets. Consumable agreement Furthermore, place growth in distribution we the position health, and and was we of While quarter, international quarter the Xeo below were skincare XXXX our number, skin revenue are with renewal

customers service benefit our Cutera. up provide repair the the We as which as of our customers time with performance the our agreements expanding treatment candidates their service believe service capital period year period. put our in agreements sale team, active we aesthetic and post Cutera support. for well between of generating as our our be prior are million with approach and volume American that volume and energy manager which and sales we will material service sales, are of growth the account prior greater in sourced over manager reach coming of Global account Key higher can activities representing so effort result a in to extend prior of better growth previous sales driven North from with resources service of into this and installed we both increased customers X.X and strategic and by our revenue program. maintenance practices. stepped out resulted and our company's over quarter the Similar as team year volumes associated systems. Our requests customers XX% XX% equipment key and that income have Cutera well sequentially continues revenue maintenance repair The base revenue and includes turn differentiated because extended building equipment aligns and in executing of key to being selected within experience partnership manager account

quarters. or capital at have expected over stated service rates normalizes slightly are next the previously, grow business as we to revenues few placement As the above

the by the has few of based fueled aesthetic continued steady build the momentum quarters, treatment. pace past patients Over seeking energy market positive to

New higher now growing and confidence volumes queues appetite practitioners’ a capital traffic one with treatment equipment patient purchase. offices appointment inspired along averaging practitioners’ stable months the at fueled half have and and for

have to variability our out for to shifting delivering the globe treatment entrepreneurial restrictions of the opportunity many grow pace seen building reopenings based procedure While continued able of regional many recovery full of volumes practice patients actively customer have around to revenue nicely, performance. we begun our In and core Along there to be aesthetic teams have seeking strong have related expansions regions and energy collective recruit continues capabilities practices, lines, customers. the their practice the from advantage to in take towards new pandemic demand. these the been practice owners many

among lines. focus treatment with has the while of virus some to vaccinated days new intend difficulty in vast continue focus have we the higher The early continue better processes and While remains to will along we of their the customer believe during teams we variant COVID patients to on small some these now sought With align Cutera most to will on COVID-XX, that our to goes our of seek increased serving experienced. treatments the the discipline, disruptions of with our instill this never to commercial customers process confidence In pandemic. regard and continue. customers from Delta may regions believe majority we the uncertainty patients to additional protect be that take out volumes benefited style. our increasing utilize environment, and select ourselves allowing practices steps in continue an Since that to regions certain

field processes make to to and create of to We based increased the of customers’ presence with equipment aligned by each sale, our and dedicated resources continue addition new dedicated helping multiple talented, best motivated team the to We greater in by will best that technology strengthened the we support provide sales within their investments will post them in class structures highly practices. capital region that customer benefit be bring blend this a as the and our This success. will with field old patient force. volumes team objectives believe to the treatment

In new opportunities to investment. to With turn revenue our addition, and that, market our our provide company I'd customers their return we that will investment the also into pathways more over to with time to find on Rohan. increased increase call recurring importantly, over as believe place equipment the faster like

Rohan Seth

you, Thank Dave.

quarter begin, note otherwise Total period review the revenue at results and in in is versus release. on of our in XXXX encourage earnings earnings our non-GAAP readers levels. and unless our conjunction reconciliation focus noted. was non-GAAP XXXX for of prepared remarks I metrics $XX.X Before release the million primarily with included to GAAP non-GAAP second please same as in GAAP for million pre-COVID the listeners contained results we $XX.X to will our A

to revenues were due our meaningfully XXXX in As pandemic. reminder, the impacted a COVID

so As results. evolve and market continue conditions to improve do our

way international again systems at business pre-COVID XXXX with lead growth quarter levels. XX% Our the versus in this

levels at XX.X steady pre-COVID and systems ended at Our North million in business continues revenue. America towards march

grew a over versus Our quarter last in levels, recurring was XXX% business and global consumables, revenue year this which stood increased the growth $X.X number revenue million XXX% XQ, under period as XX. extended meaningful second contracts. and as revenue year at defined growth prior pre-COVID a systems X% the sequentially. $XX.X an basis. last having Within of our quarter year-over-year compared result been for growth $XX recurring million year $XX.X a XX% million revenue on service over of Service of revenue skincare has segment in representing same revenue quarter There million grew to skincare the to continued strong in our service, million $XX.X of

representing XX.X%, X million levels points the XXX% margin was year Finally, $XX compared and period versus consumable $X.X second with global improvement XX. improvement profit of an our the points quarter Non-GAAP for versus grew revenue than of quarter to nearly XX an million last gross same a XQ, in to more XXXX. gross of pre-COVID

Sales expenses. $X.X compared by year R&D strong for variable up and increased to and period were $XX.X prior spending. increase is driven million headcount. same marketing expenses were This million headcount growth additional year to quarter Moving XX.X from last for million increased technical compensation million over expenses on revenue the revenue. and spending to due and of Total XX the

Finally, on to G&A expenses.

the quarter expenses XXXX. second G&A versus quarter For XXXX flat were of second

our this XXXX. in initiatives, commitment faithfully One no term adjusted same our final COVID last projects acne spending. longer second $X.X R&D and have for Amongst significant million to $X.X we steadfast our the EBITDA, as or XXXX other non-GAAP of our done commercialization in invest called programs, For experienced was point acne. a drivers of quarter of to million material income, we profit We positions. expense operating advance key these to and of of compared the program, business along changes value infrastructure a operating with into of on our also remained year. tax throughout loss period highlight Cutera in

on pardon the million generated $XXX.X the of cash sheet. by driven and quarter. Cash the equivalents of quarter, cash capital materially in at the QX, the balance remains largely the start a working at as versus versus to million, unchanged $XXX.X Moving was business ended This balance XX. me

for Dave, you the our year to to provide would with back like XXXX. of outlook call the full turning Before I

patient we have business, expanding the end of our in We're pipeline by through regional improvements for patient the practitioner in near of our As energy equipment possible year, potential see and traffic vacations, capital term the disruptions and from with continuing ongoing base revenue growth associated variant, organization. Despite the efficiencies by markets. first remain the of have half the geographies, we second the seen from our the sales Delta demonstrated restrictions year, sales, aesthetic progressed our encouraged fundamentals recurring opportunities market half we improving under-vaccinated commercial impact and strong.

will $XXX guidance Dave As the a that to revenue result, year issuing XXXX call of remarks. I return to million. some With for full million $XXX for we're the at closing back

Dave Mowry

you, Thank Rohan.

our from executing central has aesthetic thrown our In our past and thus move eight to to plan and optimize to begin the one and the this of have back to the trade two plans execution we our and quarters goals journey the worked Cutera corner despite transformation. so, improvements the Over phase organization. at the execute reputation in that to have our we this leverage conditions of us. plan far fundamental half the energy we further XXXX, term steadily phase delivered we performance game long within of based doing hard to the Entering establish market. become to team turn market We achieving a leverage has at our intend to as

a programs strong our process, As several business leading These from repeatable capable through durability balance phase added from blocks while of quality, people, profitability of place prepare optimization. our we've tenured products, optionality execution; a and to technical innovative team; next leadership benefit blocks also engagement lifecycle driving Cutera to and of depth of our team, we while and seeing leverage onboard, development, skilled for future reliable, come specifically distinction, increased expect building funding have an include focused have and for market our customers building talent put designs, which opportunities. employee the in sheet tuck-in organic our providing

business we by performance. of building centricity, move purposely customer driving these to blocks place in culture intend fortified a With optimized and

optimization core our relationship is with enhance customers improved One to of through further support. our field objectives

we expand making such construct mentioned. investments As are as and team key previously to our account manager

few volumes been for treatment Thus reposition team outcomes customers’ additional staff Cutera practices true equipment coach expand and We team this the concurrent to staff effort never account talent, American practices. and has Cutera and to the capital force. increasing through greater is this vital and the improved are patients, the plan volumes drive executing and company on effort had goal their journey and North our a of opportunities our to resources drive economic the efforts extent The of the entire mind purchases, be the fashion come for to for with sales their of has train functions hope focus manager singleness purchase. enhance from commercial capital more Deploying enhance of equipment our our in alignment expansion increased of far, our that to treatment efforts organization outcomes initiatives. our across consumable supportive has wide clinicians to treatment patient and we to key

this much excited can leadership remained the satisfied am I'd and far there While holds accomplish. Cutera were come energized the for future like for knowing questions. will full more from quarters, few excited Cutera. have to call that, Doug. well what far I we to that the and and over past the With I so open that is to

Operator

Ladies you. time, Louise proceed line the with conducting Our with will question. question a from answer Cantor session. we this [Operator and Chen Fitzgerald. first and your Thank Please At question of comes gentlemen. be Instructions]

Louise Chen

for Hi, the my taking And congratulations quarter. on questions. thanks

OpEx I is and quarter you just and look versus we that runway at fourth I on just you any some question and XX second then if opportunities it. we good nuance on when quarter, the you'd questions. sort Thank the of a you. think How about fourth is for mentioned had quarter the get quarter? you for should model we third you third in so then just slowdown also XX And modeling have market what had that question then first And So in there? was updates tuck-in opportunity, interested acne are might second

Dave Mowry

Great. Thanks, Yes. Louise.

me of continue you to move okay efforts Let launch. waiting, in program, order acne our those forward them. presented to when if to business internal the we In to ready the kind work take get regards to as diligently and be we exceptionally you the will, and

provided have continue we So this or update we are work sequence launch not nor time. scheduling at the providing to where diligently we timing any on

presence, our we've time, things. actively to we tuck-in not a to take since quarter. moving event would of third speed been a and longer more infrastructure that a sheet on we skincare balance an very leverage And confidence a that's augmenting resilience of if regards which we their In as portion the However, line a transformative kind they're that missing to actually out bit of nor to distribution occupy it at look thoughtful agreement bump we kind that focus have there's would We that a continues business, at, actively at potential adapt very management's this what fact your would existing in in of around that the we we agreements, be to opportunities, because we're the little the in week disruptive they're anything, don't or Obviously, have opportunistic. very a anticipate similarly. looked if traffic be of types be said of as will something of tucked break. for these on was the to to of tells though an and they're company. allows the They've even by kind significant practitioners going they question it be schedule. could time, will, with patient us take things to out and look will the people do always look license straight at those bit our COVID at as point looking vacation a second nothing a perspective missing for pleased, think just very M&A you little a a have But we of in us distributed Japan being from that high kind lot the opportunity at of this and term,

bit or we I more of be thing. may gets the delay something the say would something industry might deals, as selling like and a that, little this regular refreshes days see it seasonality. it as a a while loss of market, few for routine historical and us to refreshes a consumable back see that and favorable we So And actually it

don't are to at my on know positive if to add those want So all things you from all. Rohan I that perspective.

Rohan Seth

we Yes, has chosen is, consistent I certain team in And and say, mentioned the was earlier the performance. OpEx in take leverage adjusted at as on question. saying, and of to the And guide continue of the opportunity making at business. just day, start and question that, what do business. will of worked potential first the EBITDA Cutera that believe is we're ultimately the our to acne which to that's as I was the delivering off end repeatable going And hard and extremely our have by I'll underscore EBITDA not first investments available adjusted I'd I inherent adjusted EBITDA we guess, infrastructure we call in well, and purposefully entire to all, start our we've all of all, performance

this yet ability remain So we're we P&L. the this extremely in potential our of confident guiding to and to continue EBITDA business not profitability and unlock on

Louise Chen

you. Thank

Operator

from comes question with Matt question. Please of Sandler. your Piper O’Brien line next Our the with proceed

Unidentified Analyst

taking afternoon. is thanks Simran good the for on Matt, This questions. Hi, from

a starting have adjusted I So basis lines your this margin EBITDA year-over-year and with results quarter. the on gross strong a few on

line? then we your And going year slow maybe in as EBITDA the any rise spend year-over-year their ability as little people get see you of that secondly the strong Just in curious at to bit generate in XXXX. bit, little back a of in adjusted a down that gross on forward half growth pressure capital margin concerns

how catch do sequentially in here QX, QX? is and much the strength you up? to how So play that expect of in the out quarter And

Dave Mowry

me let so that Well, to try unpack question.

versus to getting margin and and XXs we the the as had there. outlook. talk below given So since obviously exit skincare what growth gross we that seen business our in first margins. about has we mix, all, materially year lot margin shifted very corporate fact a over of then, we've overall talked it In skincare And the I'll our QX, about our of our margins low are see

in of material create I'd which this job operations We an but amazing a also little near will gross of our do handling, margin headwinds bit terms costs at term have and continue leadership the some level. team say of pressure to

approximately So of by we taken me? the I'd little is I'd near our committed a bit margin we other Simran into with margin the all that say term term. account, quarters. XX% our of Also, expected XXs. But add you a few that long delayed was current remain of to follow in very can guidance goal gross to expect in zone remind to stay What low mid Sorry? up we the

Unidentified Analyst

Yes.

know their down we slow in So people XXXX. spend

much and the of sequentially up? is out in QX catch expect the So And strength how QX? you quarter to how play in do that

Dave Mowry

Yes.

for the thanks take Let And question. that. me

practice that traffic. it patient give to in have from reimbursement are monetize up that patient in as based we relatively technology the What for put flows think plays really as drive, quickly. systems pent aesthetic of for current to out they may looking while energy guess, things as think I their them allow demand opportunities I space people well protection structures can them they're and that

that the with they for amount lower that is about think volumes to they The be now pent replace demand. So unit very product. put little XXXX up patient than probably from nets and lifecycle pent demand frankly, older the on they bit stress of the have up out the in actually an may

small COVID within the the are we've So think constraints of we type is an capital historically ongoing with upon here mirror. cash mentioned around part which most practice the rearview based run this things the business regular disruptions for and rate in

Rohan Seth

continue versus our around we results would that confident grow your still rest know. being just of I'm And good guide to given that our again, of year. adjusted deliver the adjusted I will not for question choosing EBITDA to as able stress prior year. to the EBITDA the on to concern you business trajectory we're

Unidentified Analyst

team carry efforts, to terms do in can that to on And you into European about be XXXX? to that the same seeing it. XXXX? the following well expect as effectively you American from changes Got And you're positioned commercial expect of momentum North talk sell you the your line group side to more that then

Dave Mowry

thoughtful Thanks. That's Yes. another question.

company we made quality I terms have product changes the leadership a penetrated ability our sell for been as the structure. I country under under and and think Europe, as We in of change think underserved new we've made in as leadership of EU, some our a to well effectively.

team rest this able to recruit grow, talented been back building we've pipeline that recruit to to Additionally, their think or year. will the the continue some exceptionally people sales, I throughout of

So sustainable. I think these are

in Europe our further be us expanding investing the will markets also to We prosthetics, for and opportunity huge as one ability bring great field the to sales in of out our in organization larger a penetrate spaces. I team specifically called and Germany as those a

think itself. that into back the of Europe half into the in the legs there's on improvement we of before seeing early part and XX I anniversaries are year this

to motivated as believe and market their processes their has make built of been very and that first their their talented standpoint two ads, of indicated refined furloughed and pipeline, a that were think patterns that first, year we've exceptionally staff of we've year. been have ground. to this now unfortunately, the able force North at that bring full we as you sequentially a half on rebuilt if year in making investment the the level back see next In into quality, high capital build for pipelines, of will they sales expanding And in I added continue I deliver capital terms staff Well us strides to continued We've aggressively fairly force. anniversary, that we've new think half it a that the after about these them XXXX, contributing great XXXX about back benefits approach. adding highly America, we'll an to we're in of being from that they people sales go-to

So we're that. about excited very

the this investment which account greater believe capital. Additionally, managers drive as will for customers we've it we utilization, and additional of prepared indicated opens remarks, our return I sell think key some not that drive will only then added energy and these to us that in sell in industry, customers, well We unfortunately, for opportunities that are a but to put a are aesthetics really over things very and but be think good based of differentiation will very by longer this level differentiated, us we key our term in received will position capital. things up

Unidentified Analyst

and I squeeze on one vest with share if the phase you pushing still can to we detail And Any regulatory pretty on two doing can it's you stage what any the it. about Are and acne, been program guys but timing, some know forward last Got you can out? maybe expect on when roll close approval? to Are that work? have details I clinical you in? here, one

Dave Mowry

Yes.

and we I us. You're to eager vest. little competitors update a be information operate. just being exactly a about will some get have We of status right. keep more been excited an to will bit thought We've tell that it that And to kind that ourselves continue results know That the be from until that have. able of we to we this And exceptionally best you are the to freedom time. said, to point get close we've very we the continue to to for to

across internally departments the prepared into aggressively we to opportunity multiple be to get working go moving diligently market. are when and the We

Unidentified Analyst

very much. Perfect. Thank you

Operator

with from Stifel. proceed Our line question comes the with Jon Please your next question. Block of

Jon Block

a pardon more the step all first curious, that Hey, track the just what more me, seem is line more the a top role. afternoon, maybe on the you increasing primarily capital color, I'm other can us just oriented, past momentum some traction, some capital played or quarter? diverse of Dave, guys, bigger good back, in well. second areas was give portfolio the body on take the hope into one, saw

Dave Mowry

But I we it that would earlier free want all a see and highlight It's I we recovery half wouldn't capital. would point, see way. projected little anticipated. than And Jon XXXX this back great say it there. out we a wholesale to I on a for think to a started had had it's We

be opportunistic still a opportunities. have very here. said, That is diligent it we consistent think multi you approach platform in prospecting and I to saw

face our to practitioners, to keep with of has their I a think they're or patient skin find get specifically become I key trying a into way and think many monetize and non-core practices. revenue and element patients

I'd So a pressure. though, we some in of during body, particular, the previous the opportunities much micro more, the We've in see lot practitioners a where resurgence the of quarter in quarters had non-core it particular. around say, versus seen needling been secret

we success hold pleased think another and growth measure which very flex sculpting did. of pleased to for for body were our across see So platform the iD very ability to see were to both we also we and I price,

price revitalizing kind effort, right effective been that to very-very accounts to. we've So bring of and holding in the our finding that

kind was teams heavily geographically and face of So back, very I platforms very across driving really measured was or the were would international was measured the improvement. whereas international departments the few it of it it that say maybe a months some and

Jon Block

the perspective, gave recent could renewal color. guys perspective from it terms contract maybe the the month to it. for basis amount But just maybe the some I margin there skincare where I of you provide the duration you that so bit bringing shift favorable details on from regional contract. you the margin filing with anything or have the a little Thanks of run a gives ago you even flexibility? guess just rate? put it out you're more considering and that, a a or table value that differently you guess a called that the around Got can Great on was is and

Dave Mowry

not the to careful be we that very want something to divulge with around have confidentiality supplier. I Well,

the profiles and we able still developed First distribution the same aggressively we'd margins, position foremost and said, this guess, improve product, been do a an disruption, we manufacturer work that great three willing organically and the one. with marginally. that of was to years That partnership in believe significant with our going gross you're have tell our I you that revenues a to on drag and very distributed that think have over and it with and enlightened margin engaged agreement. the next not we're I certainly they're fact to see that our product It's more us we've by

Jon Block

you're to one may your me seasonality. not stay just different than a dissimilar away but for is QH And they'll it from tight, And a enough. take be last keep revenue to somewhat guidance it EBITDA Rohan approach, speaking your XH adjusted too Fair questions, couple in revenue. implied your

what time, to specific for just and that acne in XXX like does up guidance that it? no follow XQ would the And guys. your on embedded you the and XXX we acne experienced and XQ to somewhat has XQ away stay XQ on that could provided in the look thanks assuming annual I'm be So a to

Rohan Seth

Yes.

I'll out So of both remarks bit year. in acne a easy a the happen little bit that in one outlook little There our first. There seasonality. little our QX, a prepared Like had for me. there's pardon with embedded is called is start forward the of in no QX. in There's we bit

are you yes, of outlook. into on you We've if that etc, Delta So vacations, will, right. the see horizon our with factored we with some variant, blocks, stumbling in the also the

Dave Mowry

that there our are still that the upon Just view to of going view outlook turn based we here there's the an street before on. of is felt unknowns, things lot round a lot question over. recovery. with that My of it We that a share out much markets compelled still very is

to We vaccinated and be of market just we are want the of there some that an variances are we momentum still as building there geographies, just that wanted in continuing remind a the we're to last, However, very-very other with very as mindful we're these of thoughtful exceptionally to forward. Delta bit very concern. issues and that little a under continue and thoughtful move organization the way. Nevertheless, momentum around pleased measured creating

Jon Block

the Perfect. guys. Thanks color for

Operator

with Our comes of Cooley next with line proceed the Stephens. from Please question. question your Chris

Chris Cooley

congrats in afternoon, the everyone. quarter. there performance on And the record Good

incremental have and not maybe, as we timing that about back then color maybe just the me, think of EBITDA the adjusted benefit? the these for Or the of just any half, realizing may for if the follow I I've to of much. in full other timing yet but Thanks here And got quick can or an think incremental getting to ones when either be aggregate, up. place? investments you're one take investment, planning that absolute to quick it investments year, pertains magnitude would maybe two help terms you Just in you're these will about for think keep decorum. us If we

Rohan Seth

Yes. in. and I'll chime little that then a Dave, take maybe bit you can

and to in So we guiding but pointed adjusted I said out, several believe We investments processes, towards I'd like do say rightly to expect growth. process us our acne we what and up event you EBITDA in we're people not need we that that to give us of phase next to the systems, making. maturity, this an are transformational there advance are for us launch a and for to set be evolution give of scalability, us

out amount next four Chris. is a might so. that two and that or be give over to there a to materially, So somewhat four I'm will hesitant Be change the variable an quarters, here quarters lot spread bit

Dave Mowry

of a probably I quarter. more say Yes. infrastructure four would the is

making of exposures recovery in of relatively expense of investments I as a creating team sales our most of And we're comp. seen here. these comes we've funding the think building sales company most kind teams out the risk are self from low variable in mechanism the for revenue the and that rapid pretty

it the on that confident the feel be kind relatively to very we're of neutral I adjusted the basis headcount, EBIT business. into sales organization So will adding in

where I over more are the evenly next more quarters a four think probably so. what expectations bit the spread Rohan little shared infrastructure they're like or

Chris Cooley

investments, Just of XXXX I maybe bit tapering course back about just think are maybe here next my the over part the a really infrastructure in half this little just follow whereas that's year, up, talking the do the that primarily to calendar investments clarify, early year. sales before of into of about currently you're the the

Dave Mowry

good. That's Chris. correct, That's Yes. That's correct. exactly

You've got Right. it.

Chris Cooley

in then when think Jon's up very on And Thanks. it. the of Got question here was course capital about follow growth, the the which we quarter. impressive let as me well,

both sorry, came body contouring the mentioned when both about reduction in contouring, we help the you just broadly fat fat and growth about the think reduction relative back quarter. know a in trying contouring. uptake body the and You I'm you've a in Can rates the I think the broadly. in platform? are and muscle spoken growth to feel more for the of resurgence combo just relative maybe continued to get to past body device, us

Dave Mowry

Yes.

device. explicit, be to a combo not just do So we have

device combination use iD. do with we in However, both our

Chris Cooley

I I mean needling the and I wasn't micro clear. apologize

Dave Mowry

No.

jumped I conclusion. Chris me Forgive to the

body that And to our will you price up me and we that is that by now, recovery get confidence an demand see nice recovery. equipment to looking or preserve for things discount these think the servicing. in select continue a of did lot it's to there if terms until that iD. portfolio, selling I we're which of a underlying see out access right want average are So information store going happen. to kind sculpting, we the people me an even reaching is That And body capital to gives underscored that not, we're in tells strength of not ability make to

certainly, half And of in in that back year. both So products. will strength it's think that we on, to think that like because I continue we technology of area the focus we this there's those have there an differentiated

In have board not combination laser laser, product we it's terms treat surface little portfolio. really blade of the the this have also scars that do when particular, the in lessen of PRO reflect this only think device, only to a blade a micro and fits both the CoX extent fraction which you for in we the that Secret collagen in of recruit that And product think of but of with and as our the needling, core exceptionally derms the its deep a we to we portfolio, laser it's blade a with well a needling, on opportunity of great an in the wrinkling. bit they business micro a is the ablation wrinkles, on

great product. results of So we've seen that

bit to an is practitioner at products of more should us as this to in continue little kind market overly a believe been We've our deal or rates our staff that product those putting the in But with the or we as forward more may really the at used going point. not position aggressive team products. with we maybe a product to solely and to bit about want our as augment energy grow that have we power it think think more win We above positioning little well a those and body that as wrinkling. aggressive secret

are the very-very Xeo, closely follows and from platform those four XLV even multi I products So product. think line a our probably perspective with our our most solid contribution

all and good are of demand good that products I think renewed customer. from very in in marketplace, almost a the sense core reception these have very the

pleased platforms very of we're the our across different way So with for is serving. all that the these portfolio practitioners we're positioned

Chris Cooley

margin. have lots XXXX. an out a both in gross on on the I Thoughts that pertains suppress realized but here thoughts with coming line COVID future the LRP. additional squeeze this generated helpful. there of that color provided can next material at as looking any or of in you've one some this and transformational the maybe mean, And I well at margin to point launch the terms here quick update acne you as year the a updating margin. thoughts top your you on maybe in it And either here future, what's at the if called just That's of growth transitional end is and year growth results, other a one here contributions year in profile LRP clearly tremendous to just for early improvement, I the to is on

of again. Thank you wanting maybe Just term about again. longer level kind think setting that to

Dave Mowry

Yes.

it's question and I a comment. great good a think

the working XXXX look launch for of for of the this like at we're may kind the what business. acne etc, like, year budget through a to that timing timeline point, looks through what the is, board working be for our working five what company. on the look plan I on at what And with the thinking a think kind fall we'll means, and plan, diligently aggressively

as that to position better some point sight I be of a well for have. little into key think as products thereafter, in expansion at other bit probably line acne and and we express plays that ideas how we some that, have a

Chris Cooley

you. Thank

Operator

of Our last with Vendetti Maxim Group. the line question. comes your from from proceed Anthony question Please

Anthony Vendetti

Thank you.

quick took questions. Just two

mentioned to continues you'd I perform if that in call sustainable. business the skincare didn't it think you last know well the would be that Dave, On

looking managers an success almost expect hire post start support So called expectations new process? to to one just this it managers sale rate? the enough should that many well reps above or And question perform this shouldn't sales sale on key we and you those to gets one or is Are as account and it after managers PDM. too it as of to others help here reps with the is Or performing be at is the about stay to think continues run reps? still quarterly we the your at customer -- Or next to ratio account this? to with

Dave Mowry

thoughtful questions. very Two

result though, were first vaccinated been it's stuff many-many to the think traffic probably of as we wrinkle call, the into Japanese serum, the a we normal lines, more our one eye double them that that fact may of the is we're business under some fully be a that means terminal some is skincare. And have for as probably skincare what change. that analysis people digit I will up. customers we is that using may know everybody if bit single to that a help patient feeling hear benefits very vaccination or a the Anthony taken procedures. end at this to per in reduction, give and low to rate now. remind on patients of how of or more which I about the of there's at associated But feel get buying from they get think very additional or of think more new it business. point it's does the due just was believe So done And said healthy derm digit what point is through to terms little nature that more the we patients The on earlier thing that and high will will elevated are in we've market. we Japan millions. kind that don't think a when lines, We in the and What it's But and we all and suppression of it right result millions sustainable the seeing we a it yet we've all kind be that on quarter. result not much difficult procedures. somewhat avoid we SPF, had comfortable that with retract see It of them as some be comfortable exact there's skincare recover, said it having of skincare moisturizers, have Even offices much projected

routines in And regular routines some culture. of disciplined and a the feedback has these been very become habitual in terms of

the accounts managers. So growth be we we question to the as we're continue develop into legs well small has that But deeper with excited around this existing and additional account in long may a is. new opportunities also accounts second On believe mindful penetration want grow to markets. continued penetration have those for key as as your that it some has step term and at it about where We point. back

capital to throttle think industry drove own key and going going our given with one for effectively. everything others handle to new know a be they certainly best watching is as using be lot say accounts. upon ratio add what and can metric say number based the from the success and would processes and manager we'll I can we'll accounts or you of as But we've that to the add combine not And we of as we've we locations. right dynamics. any trying people this we a it one between key some think account We're account that them we to and about their in necessarily think it's ideas learned of would steal others what I for from we're imagine to and our gleaned market

of right know So metrics. I have to all will staffing. drive have and can activity. roll mile from and and accounts around out don't I given the there number But well. out our we ready we it tell certainly you that know think if Zeltiq there yet the I manage others And the is have any we're more of that done right that plans range right deep well level we that longer person the markers

Anthony Vendetti

That's helpful. much. Thanks Appreciate very it.

Operator

This like Mowry remarks. session. concludes hand Mr. our question and answer for back I'd to it closing Dave to

Dave Mowry

everyone you this providing for another to fall. thank update We you, Thank attending. much then, Until later with well. Doug. you look be very forward And

Operator

Ladies teleconference. and for Thank your conclude gentlemen does participation. today's you this

your time may and at You lines disconnect day. have this a wonderful

Cutera (CUTR) 5 Aug 212021 Q2 Earnings call transcript