VAPO - Earnings call transcript Q2 2021

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Operator

Good afternoon, ladies and gentlemen and welcome to the Vapotherm Second Quarter 2021 Financial Results Conference Call.

As a reminder, this call is being webcast live and recorded. It is now my pleasure to introduce your host, Mr. Mark Klausner of Westwicke. Please go ahead sir.

Mark Klausner

you Financial us Results thank Second the and XXXX Quarter Conference afternoon, for for joining Vapotherm’s Good Call.

President and Joining Vapotherm's us in like being Senior To will the to Army; the call that I President are Financial Vice its is the call following and Chief live recorded. remind John on Executive Officer, and available would today's Landry. visit and Chief our call this Officer, of A you webcast section please our IR replay access website. website, be Events webcast, of link the event the on vapotherm.com. Joe

or and filed were the from filings X, December uncertainties in those on begin, respectively and including could I management ended annual We which factors year calculated to updated website. on reports obligation filed and law. report, Accepted GAAP. by Form also that and publicly a Principles current Accounting information, that not those or references we are today financial that Securities on your to expectations results the filed generally press call required undertake be comparable GAAP our which with refer will risk on section calculated remind our SEC Reconciliations to presented everyone time the of statements which questions in XX-Q our cause to events based remarks identified XX, and or may our measures. from XX,XXXX measures and Commission release may the XXXX, contain otherwise Before our materially Officer, or most accordance non-GAAP of These the the earnings President to time that, include non-GAAP financial like in forward-looking August Chief of inherent in Form with with to as to our to measures the responses on statements. involve for accordance these no over in unless to SEC, Joe the would June certain with risks financial X the are and SEC available differ This on for indicated the of measures the portion Factors call Investor May and of future subsequent Risk forward-looking new these actual to with and with XXXX, We XXXX revise result are as XXXX website. are available XX-K it's my publicly Vapotherm's our turn SEC. Exchange statements Army. Executive filings on XX, pleasure quarterly update the Such was March February Relations With XX, in Generally ended XXXX, quarters

Joe Army

increase Vapotherm. base international installed to strong today. our joining over The We offering. the America. in worldwide Landry, quarter then focus to thank another provide to Care you financial units of our the Post taking increased our Good I begin quarter hand Then over I areas generated our million results. will of our on XXXX by second us John remainder for key nearlyX,XXX of Vapotherm and Vapotherm in our areas to XX,XXX year prevalent second some discussing majority launch afternoon questions. XQ as COVID-XX before and for outside U.S. Access rebranded of Health HGE still update prepared Digital and business the results. was We will revenue, will notably, Latin I for details Access by our you this the the call units. driven $XX.X quarter was by CFO, was

the business. strategy, Lastly, Hampshire Exeter headquarters more our we goals where New products, about our Day in shared for we first our hosted and ever Investor financial

patient same Our our guide the business. towards lung and four of for These disease establish XXXXremain becoming company. objectives our complex X.X goal will the us management digital objectives four

walk this progress me during you Let through the we've of each towards quarter. made these

the front, or is XH is our educating Our treat productive. installed to one current hypercapnic training is and day that customers our hospital On technology’s ensure one base XD on hypoxic focused on both ability first to objective and strategy patients.

with our this how on on and share our therapy, all Bureau actively positive patients high technology patients. of engaged part Speakers As with we especially hypercapnic use their customers our strategy, ED to to experience to velocity educate

As take increased main rates time the This two we expected, is you, John to installed customers will lower for on quarters up past for average. other first, than it will by historical applications disposable over U.S. utilization with base speed five our and non-COVID technology. to our we our get factors: share to due were in XX% XQ our as

at was U.S. the U.S. overall top in or utilization rate historical the the utilization rate While disposable our averages, historical below XQ. disposable was two XXX for rate above XQ for disposable Customers utilization

In levels customer orders gives burning XQ addition, orders XD strategy XH we'll our placed post-COVID. in all, that purchases us be a after achieve through and confidence made accounts of these but to few across of larger and placed remaining XQ XX% accounts up the in the is historical base able entire XQ. turn working This

second RSV and hospital and from fears. this discharges second census COVID-related versus staying hospital. due patients return expect of of for XX% as in the lower to time, we that flu insured U.S. COPD XXXX. to of these quarter Second, patients trend will away the respiratory Over reduced to as result the a temporary patients We be measured respiratory quarter the XXXX by was believe

guidelines. gives society additional XXXX, on of our XX% to confidence over U.S We're XX% XQ XQ same our included post-COVID. working us the period, While we'll to down was to strong disposable as respiratory be clinical which our revenue evidence business compared be mid-teens able also that the building in grew focused base in and census grow in

further designs patients. enrolling and ability patients centers to study HYPERACT hypercapnic trained support has treat is to four our Our now

high educating issued in is patients. focused team the on which recently issued was included field Safe that report pleased velocity hypercapnic therapy Staffing U.S. study customers our AARC’s Effective Guide. in Plotnikow to published Argentina, and Our recently I'm the on

As result, the same potential credit adoption productivity C-pap, technology a eliminates guideline receive serve changes our and our bi-pap efforts. a resources in of XH study educational These technology. XD barrier as as which to important the will in results our

new introduction revenue the per or XX We includes through per OAM Module countries are working installed of unit Assist in increase also unit. like Oxygen installed our to now recurring which revenue is available OAM. increases and the revenue, subscription-based products

OAM Europe receive UK, and our East, pleased we the and and We families. the their are to launch from continue with year-to-date Middle feedback our from positive in patients, results customers,

is objective base. second installed our Our to grow

the markets. of U.S., installed focus grew in leveraging XXX this base hospitalizations silver by U.S. accounts XQ, driven coming and in in largely two-thirds At select roughly gold we In nearly to installed Latin our Internationally, coming expansion We Covid-XX in added and installed silver by existing base of rates high one-third we of our we nearly Our base drive the and Ed by were XQ. is from accounts in expanded our sales end America. installed accounts. from and base of grew XXX gold the force the saw new over new and U.S. the international both existing units new XXX in growth accounts by the XX accounts units, with

objective air.. X.X X.X hospital's own will a third us storage Our from need its to to has launch built-in connected to is which in piped free HVT HVT be the allow air break worldwide. to

be will X.X existing HVT with market we on focus initial where an have Our the footprint. hospital customer

market limited release initiate We later worldwide expect this to a year.

also home as how able can help as Vapotherm and X.X settings, EMS settings, limited will well our how the patients use the we release to new to it market in We including care learn integrate might with HVT Access. be

now objective establish final digital business our Access. to Vapotherm Our branded is

will Care Our lower seek initial product discharge rates. COPD after and patients XX-day for Vapotherm manage COPD Access readmission Post

As team launch, you readmission was business. a this the national pays a COPD its this hospital’s technology know, entire on offering preparation if hospital on in for the of July. our is book entire In trained fine average, CMS U.S. field rate above XX-day

COPD readmissions. We COPD will preventing we'll or on gold silver patient with volumes target our ED significant accounts reducing discharge focus initially and and

We proud will expand Care. XXXX. success our we Overall, launch our very new half this beyond Vapotherm of Post I offerings am as Access product learn in of for the first

results, the to of about I'll remainder what's John our customers time continues After in XQ market team and holds needs details the meet business. day dynamic of very financial our and am some outlining focus for spend Our for remainder our a XQ John? XXXX. each excited I our and

John Landry

you, Thank Joe.

XXXX, $XX.X XXXXrepresenting of of second greater of of revenue in of the roughly second revenue of to $X.X two capital we the XXXX, XXXX XXXX. XXXX, of the $XX.X $XX.X in in significant In million. in of second Recall in sold million, in In International demand was to the the demand. compared hospitalizations. XXXX. of X,XXX capital $X.X the quarter was worldwide related XX%. XXXXwas X,XXX quarter second $XX the XXXX million versus the of rate to by to revenue decrease PF the driven million second $X.X the Disposable the International decreased XXX,XXX in second quarter we in in million, COVID-XX million, $X.X quarter of $XX.X million of mentioned, was of our $XX.X quarter quarter second was second quarter the million, full disposables quarter growth second revenue compared quarter which versus of we second XXXX. capital compounded second million related $XX.X Covid-XX compared second million million significant million over the revenue of million. XXXX, related revenue revenue revenue in quarter compared of million second due sold U.S. the year of in in $XX.X of quarter XXXX. quarter to COVID-XX revenue XXXX. U.S. first quarter $XX.X $X.X quarter was second worldwide and XXXX quarter second As annual was was than XXXX of quarter XXXX. a Worldwide revenue to of the in of to quarter units compared of million, XXXX, quarter of second the second experienced increases Capital year-over-year XXX,XXX was revenue $X,XX,XXX $X.X the revenue compared

use the hospitalizations was selling in million much in of in a sales markets. than there second prices to in in the revenue International of of to of largely and quarter compared quarter million $X.X disposable XXXX, centers. compared of in Worldwide base to the demand international increased in concentration the increase network was $X.X revenue second Vapotherm the number $XXX,XXX XXXX, America. million, a we year-over-year to XXXX. decrease to units. second was International was to disposable sold XXXX. XXXX COVID-XX lower to quarter worldwide installed as Access COVID-XX respiratory Latin due are total quarter service the due $X.X the serve related distribution the higher due $X.X disposable flow second nearly million, was the compared in revenue U.S. revenue of revenue service and $X.X was U.S. of second quarter million worldwide While disposable international precision lower in of flat, an average The significant

base worldwide XQ. in X,XXX installed grew units by Our approximately

they Brazil, consisted As XX% levels increase of by in base in installed growth. and the elevated year-over-year of winter. as the base Latin America the installed second our driven to reflecting of units, going particular, an approximately of COVID-XX was hospitalization XX,XXX growth Much faced end quarter,

for utilization monthly his as average to factors, quarters of compared rate and of said second quarter which which in Joe, U.S. the just U.S. rate The X.XX decreased year disposable due prior year-over-year disposable was for several the the X.XX, XXXX to the was still disposable XXXX rate second in through X.XX XXXX. utilization comments. Our utilization

base installed due enough in patients they significantly resulted oxygen could expanded meaning COVID-XX, hypoxic, not to an who which in influx our First, system. get of are their

technology our these patients and clearing units especially our expected, dioxide new often we with on on like become from fully newly installed to productive difficulty are will focused have it for take works customers As who hypercapnic COPD their patients system. carbon time how educating

to respiratory-related Second, zero We in and discharge U.S. the census, the discharge is second below due measured the hospital. by fear and XXXX. hospital as respiratory-related of in levels quarter being of respiratory-related exposed was RC XQ discharges this to for reduction believe near through the COVID-XX over XX%

for us second to return This to quarter decrease census, in quarter rate term. patients these to X.XX grow long XXXX. the expect able the disposable a utilization confidence revenue XXXX. and to our that We The of average through international grew to base. the XXXX monthly the the post-COVID. mid-teens business as U.S. which hospital in XX% our respiratory over X.XX rate X.XX XXXX, as the second in disposable compared utilization by to the quarters disposable of quarter disposable XXXX due the the in quarter gives significantly Despite XXXXwas was of compared be The year-over-year XX% second second our installed rate we'll expanded international for of second increased utilization

is XX.X% absorption the a and a XXXX, was for decrease $X.XX quarter Net overhead As in primarily second increase in in increase gross due XXXXwas production Gross lesser year-over-year disposable XXXX. adjusted it over basis. marketing relative mix $XX.X the of in for million the revenue quarter in and to XXXXwas by in offset $XX.X quarter of fully in expenses. second sales partially to XXXX. research $X.X partially loss profit due to the the of gross primarily and shift second quarter to general loss compared returned primarily The was to in million a expenses of and of were in $XX.X offset of the margin in of expenses, million $X.X margin $XX.X in quarter due in $X.X loss an EBITDA prior revenue increase quarter decrease of the time in by revenue. to U.S., reduction the the expenses as over share $X.X second of of take development normalized The increase second productive. or units quarter second $XX Operating quarter of negative the levels newly per XXXX, XXXXwas to the of million was million, decrease negative will The second Gross the low higher of to a $X installed to an or become international second XX.X% year. in a second administrative in per profit $X.XX extent, reduced to XXXX. million, gross million in Adjusted margin million compared and second million, quarter a a quarter the in to revenue and million operating share, The XXXX. compared loss EBITDA was on XXXX. of

as million, compared end cash second $XXX.X June December the and of million, As as of cash on March equivalents the XX, XXXX down which used $XX.X to XXXX, of used and of our million line of principal XXXX were XX, to million In $X million $XX.X we credit. $XX.X was of of pay XXXX. quarter of cash

midpoint year we Based two XXXX and increase terms of full and million, over that an guidance only the and be revenue $XX that the reflects which expectations a the guidance, this In previously from early of our full we've XXXX now guidance expect results on guidance issued represents so the providing revenue of revenue update of far recall annual million. million in year an to guidance. XQ. full rate of $XX at range. year This XQ $XX full reflects year, of of growth XX% impact revenue year XX% COVID-XX for between compounded to of seen new million we're annual $XX This

reduced to second year light expected we communicated previously sales the due capital of the half capital in As budgets.

quarter, our third disposables to what demand in the had of see. what distancing, mask impact we we currently potential to be quarter, difficult the of the revenue deviates about forecast year hospitalized worldwide be social while we fourth our near driven XX% timing, assumes variants. However, over capital opposite levels full worldwide and we COVID-XX to to COVID-XX experienced previous of continues our the typically It we seeing COVID-XX to mandates certain as are similar and lower XXXX. COVID-XX due than of the on impact revenue Therefore, for quarter, COVID-XX extent and units did the the revenue quarter of impacted. increased third expect to surges our which and see the revenue geographies patients on world guidance around impact and U.S. in predict is by U.S. of in from quarter in expectation, would demand second the Based return in we third the in the grow the duration in international expect

also an We due offering. gross of to from introduced expenses continue of over margin it $XX in as our the concludes million XX% grow turn the to revenue Access million to At in remarks. to resulting XX% expect annually million, we year full to we our timeframe. million, Day, margins full year our back years issued to $XXX goals. between five you, now year gross primarily next $XX Vapotherm expense and operating Joe. operating expect to Investor be This previously to over intend I'll to five XX% We mid-teens increase this doubling our financial improve investment $XX long-term guidance in over revenue my now

Joe Army

Thanks, Johnny.

Before sharing our U.S. to - highlights some of I'd Commercial from our Officer’s the extended XQ objectives, Chief field like travel.

a environment. treat hospital have beyond on as large how key They've PF at to of weeks hypercapnia. particular other quantities visiting Day customers purchased the completed, on soon three focus were who to Ramade focused use on As of COVID current these road units have our areas them training the spent Investor following: for customers. been Greg with units and allocating ED to requested been how confirmation during His First, findings in the was the these the specialties

training. education Second, usage patients working our increased this and to through we're efforts hypercapnic seeing are medical on

they that Vapotherm about Access and him readmission interested Post in actively rates are Care. reduce with were COPD more shared hospitals several to learning Lastly, looking

remainder ensuring our productive on hospital. of hypoxic emphasis hospital we the and will year, will installed customers treats day both our heavy one throughout As we place our one the hypercapnic and we especially ahead how look educate through our the to XQ technology on base’s program, patients

will same Staffing productivity we credit issued We Effective educate also which as and newly Guide, AARC’s customers in c-pap. Safe and the our the now received bi-pap on

the adoption increase recently drive the We and will Argentina. saw unit, outcomes Dr. analysis Plotnikow randomized subgroup the hypercapnic our from trial. treat patients in in To RCT study, ED UK, revenue the develop Dose paper per the demonstrating consistently OAM Middle ability we we clinical control evidence and recurring issued like East. installed ED HYPERACT by the with will our to EU

OAM’s are in the additional We to working markets. and on potentially quantifying reimbursement EU economic value other pursue UK

will with the through work breakthrough U.S. We clear the FDA program OAM the devices to in

by runs previously approved our as study as IDE study FDA to As possible. announced, closely and was ensure working study we the with are the the clinical site smooth

to expect study enrolling patients this the We near begin clinical future. in in

platform We will launch worldwide half grow the of XXXX. the in and our prepare installed base new second our X.X limited of HVT for

develop Finally, launched also will Care gold the connect COPD we customers’ our the forward sales and newly with us to hearing feedback patients, on in provide both Post their We're Vapotherm ED introducing refine Post setting. inpatient our Care directly more team Access and important looking and product Access needs product. will home as be our silver this Vapotherm information to will customers. which

the I educating high velocity like spent I XQ. field came clinicians in following therapy. patient which story, members the to me the from morning to team one share on of closing, Before our would

won’t and told with CoX confused to elevated agreed we the wouldn’t respiratory in XQ We for at good leave breakfast. very The to technology, a ethic, on we her at that five am and about how XX. work to While the our the our a I probably on a therapist them meantime, how any explain to a hypercapnic it the put us he guy. come patient's quickly came patient agreed. half numbers works. little into After organization RT let Within he I room in this asking ensure could nurse patient to The opened the asked patient bed patient. the She need and check his In it. a In up, and first big customers’ the entire told if start was Vapotherm me and minutes, our unit with on us nurse bi-pap talk COPD year our our rate combated XX. in were put closet. a of was sat know forty met put her and was. His bi-pap patient where high got was saying his could and his spoke the we asked we When what there, He talk asked worked. velocity eyes high call of and and team's minutes was back he the didn't unit that was the from put Vapotherm. it outside the and sitting unit the efforts shocked and up I down we the I very I therapy, confident conclusion, this the she a was to proud of on will I bi-pap the accomplish physician started tremendous physician needs ED respiratory doctor XXXXobjectives. worldwide. of am the for

for move patients and the with further in capital. of all velocity prepare care our trusting areas your the into Thank We hypercapnic opportunities our adoption both therapy setting. about to high appreciate for and home are us the it. you for hypoxic hospital excited drive in We

like I'd it questions. up open to Now,

Operator

line comes from the America. from Bob question of First Instructions] of Hopkins Bank [Operator

Your line is open.

You your question. may ask

Brad Bowers

Bowers the Bob there. Brad for taking for Hi today. you on Thank questions. It's

maybe coming should we So, understand in rise lighter. the people the disposables have on and COVID to up, the you delta mean, forward? going the know I in all really you the think have that really just a gave be quarter, quarter. appreciate in it But getting vaccinated utilization want might the - floor I the don't as your for you little color

So about way the it? is right think that’s to

John Landry

your for it's question today. Brad, John. Hi, Thanks

as at Brad, in of we where think quarters And - quarter saw the we period there last basically base, there saw the five we grew is that over XX%. were, when that in about utilization of X.X. the installed quarter, X.XX growth we about time we one we the the thing versus look saw in what So, of terms about we is that the previously

census quarter the We XX% of as second about to XXXX. compared also respiratory our saw

guess I think in about decrease the we'd not when So, you floor, it census of more. much respiratory see that terms sure

I lot we flu, think saw in low of RSV. a staying zero we pretty near saw much COPD very patients the And hospital. addition, away from the

a but say pure low perspective is of point, be entering eligible be patients from So not may it numbers hospital, that for a absolute from perspective treat. the to pretty census we’d it patients low would a

Brad Bowers

Got if more helpful. then, mind. it. one just That's don't And you follow-up

I appreciate that color given modeling. some with QX you in out will noise the help So, on here giving all

to give - in wonder thoughts that on So, I on or would guidance QX. mean, really a right. for that I so that doing take just you. and your Obviously, on here, seem kind kind implies as would QX in what assumptions that of the it back much that's your the imply what's Thank to seem it am we it's but QX. that coming of there? of imagine little the capital be of that with for But not disposables about some just year. maybe just the and to implies what thinking wanted QX I utilization. for understand flat rest are almost but

John Landry

Sure, Brad.

slowed through, we in the surge in would quarter is fourth after the it's U.S. comes that U.S. perspective, capital typically our that what after XX for previous concentration capital once typically we've Again, So day assumption period expect particularly from the in fourth a be, quarter. seen of window. then that surges of in the light is a pretty a terms

kids little won't quarter. the back a the seen on fourth the we we above of into in second and go would assumptions So utilization fourth RSV go in as go season, disposables expect what bit do season quarter, to see do as And school quarter way we've as and into and the we we flu much in here in capital the probably alike.

So than that's is how seen What is, large we've about particularly typically third fourth thinking quarter we're quarter. it. the

quarter see larger year. the of expect we'd fourth to third than Here, coming quarter out

Brad Bowers

Thank you.

Operator

question line Kaczor next Your from Margaret Blair. of William from comes the

line is Your open.

Maggie Nolan

on This a for And Hey, that ask guidance full Maggie guys. of is question on, Margaret. just year implies. to I kind what wanted

RSV, full we the So, the that you back of are quarter are XXXX. thinking just the And guide or flu into year into in half guys in Thanks. the COVID-XX fourth there flu of about particularly any XXXXand as mainly then, assumptions? the assumptions they head impact for are how the

Joe Army

Sure. Maggie. Thanks for the question today.

we're seeing certain XX to quarter, we day as that COVID the other surges, the third in a subside. the of southern part at driven of terms quarter, In XX in particularly of in we've looking U.S. U.S., about the before some the see window, that as geographies we're demand by the recently. we're in largely particular again, in And start U.S. it typically in reading the that to news seen here in

happen should distancing social assumption season mask quarter, in given here in modest is potentially fourth So the introduction in or the that our the fourth to season, quarter the RSV about of in as COVID-XX introduction, and say, I particular, thinking we're again see cases here that, increase flu here. we And modest U.S. the in wearing the adjust we'll

Maggie Nolan

of just just the Thanks you look we at the particularly XXXX. rate, How for XXXX? we know And guys you looking I with talked about as the head XXXX, helpful. in we Great. so, could Thanks. just second kind you much. of more being can think in into turn so disposable rates maybe do expect of what lumpier, quarter, more, continue I that as saw And have those if turn to one the lumpiness then, ask kind on That's HVT particularly X.X?

Joe Army

Maggie. Sure.

our utilization be to lumpy a experience rates, that, of period we is about continue time. be probably As disposable think it

base, can us technology work so, settings, work or time beyond quarters of four of get And use period it’s COVID all normalizes the it’s on installed we COVID through six we through an our to our across hypoxic of perspective, case probably to and expectation patients. new our think use out. net of about for hypercapnic all customers educating From whether

second back we we look probably beyond the educate we think four we've continue two above as six customers in here to educate success to hundred, there get in long-term, that turn to to we levels in about top stabilization. had those rates at were the at the as rates the historical were levels. again, saw be timeframe and in those be quarters, think over we we're the their the to which or confident I we'll the utilization to hundred able U.S. able couple accounts get customers top that post-COVID historical And quarter

Maggie Nolan

Okay. Great. you. Thank

Joe Army

welcome. are You

Operator

Your question Canaccord. from Bill the from line next of Plovanic comes

line open. Your

Unidentified Analyst

It's than now tonight. John VAPO’s taking you you're utilization just the of some impact on on Bill on wave previous seeing of Maybe think Thanks much do getting patient this right that clinicians the question. hearing touching this what We've technology? in for Hi. our specifically How demographic. for different COVID is QX. been the waves,

Joe Army

Thanks John. the tonight. Hi, for question Yes.

previous including younger to are is seeing now your more ages older we're more In people point wave the impact some terms people, of seeing populations. is, whereas patient patients, in what of of the we all vulnerable COVID it variant,

now seeing at point. in here terms Texas, are Florida, across the in geographies U.S. impacting particular is Louisiana, what this we Southern In U.S. of it's The specific the

I technology, probably where think or track it it be of terms what hospitalizations and I for think the does and trend be it mean probably upon similar. depending In COVID adoption fairly utilization of

patients all to applies is technology distress. suffering of respiratory from ages Our

respiratory have an the distress. capability any of patient emergency to presents So, we who support department

here third hospitalizations quarter. utilization think in the part large determine I So, go COVID upon the depending in where

Unidentified Analyst

Great. early lessons in for Thanks. full market implementing question. a Any Access again it Vapotherm And Thanks that believe I for in release the market just you follow-up questions. quarter. release implies from our market release? taking the

Joe Army

could one I want. I take that if think you

unique very seem it important think quite that solution be is, is hundred solution. learning in I So, knocking that. the this problem. silver learned what them, to gold a readmission a to and rate particularly national is this And ED problem it down we're for five This It our a a is is interested bring is real average pretty under hospital we've accounts.

So, challenge that learn field team how service. running that in in sell our came And lucky they background. to we're people the are we've a that view folks also of the got helping from wise that to into of

what folks And But, watching It person really lot. great have learned is of them what all digest solution quarter Chicago it. that, that’s helping the was is we've those this I and and think this And get in so, a patients to a here, really earlier velocity in together problem early that like learn as they our in a when we about we're is ED. a into solution. hypoxic treating it hospitals the this these that therapy patients, already for really well those is with hypercapnic are as fact looking these high

fit all really a around. the it's nice So way

Unidentified Analyst

John. Great Joe and

Operator

question Marie comes Next from the Thibault of from BTIG. line

Your is line open.

Marie Thibault

those heard utilization and Hi, process. education stats on I'd Joe taking questions. first maybe those accounts. a for and the with training accounts two-parter John, top-XXX higher and the ask my I the the seen to like thank you about here, as

I So for think secondly, kick tipping should how accounts? hospitals And training curious wondering starting of how variants pause. start took when the those in that training that improvement about, long those put future or I impacting of of And sort point shut access to your you accounts? for we these down kind to efforts? that to variant sort am see or asking things you about delta are on if am or to

there updates any great. So, would be

Joe Army

longer its a And candidly, one clean were question. quarter pretty it's back them excellent accounts gives total me, that on look and we deal people quarter be this mentioned, great a when is those XD it they it's the was source delta when install business accounts you closing of XH them to and base, spot variant this when in back work the where But a our through grow of that, to confidence moving term. access. at use can the the supporting down as day book. patients. our accounts had that's I'm XXX going top able play the work because these rest it all how in to learn second are it because us faster us how complain non-COVID to becomes listen, is for and and that Marie, we you running run every going away in about medium bigger It from on of we being we the frustration focused was that in But So, not is these about of this to on

results go soon beginning your there quickly. But the this are we use patients other pretty see one, dealing really So, around that pretty on demand have. they all of with do we it time on and you're XD and of surge every you now that that types to XH back from need them meet we're to typically, if in making where COVID every a is works who situation you're XD, XH our it a are into will can it see and sure going accounts focused supporting frustrating

Operator

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

open. Your line is

Jason Bednar

for skip the me I for here am over Thanks a taking going second. guys. to Hey XXXX questions. today. couple from A

You gave the should in forward including above This margin. some other around here grow XXXX mid-teens gross to ability commentary looking be levels.

so, you're beyond company-wide there disposables you're though XXXX. terms I from in normalize was a the I how I comment in your the of referencing mid-teens that wanted think even And growth that about think we business just the the end confirm to thinking period common as

production much characterizing costs. is dependent, that that you And are that XXXX if wondered more within point. that what just out your upside on control So pull efficient to to am how margin make be volume gross margin and actually versus side, how the then, correct versus might I

John Landry

It's questions. for here. thanks Jason, John Yes,

mid-teens I grow business overall In our to terms think of ability business forward, is going itself. the on yes, the

guidance was a provided compounding think a window. on our per I long-term Investor year we over XX% doubling at Day that business the five year rate growth

good top wider So accounts what especially seen accounts, like to continue training we've go and XXX there. on and U.S. that. in We the educating the we deeper about feel

look a margin lot control. the we of terms it improvement of gross as within is In at think it going our forward, I

play, - are have margin we think levers forward. that gross levers to all continue drive I going in Jason, to the

cost in worked incremental clinical economic the ability up and products I think customers on as the the prices by through ability of to horizon selling have utility redesigned to introductions we design drive to new the these have reduce here, product we providing with And able new production our these improved quality, for terms that lever the in well. per last drive longer of overhead extent our the these through we utilization as play well that in as manufacturability. overhead unit rates as cost normalize down then, term, is, over to being one to the the reduction still continued

So, level are that intact XX% all three get levers longer going Jason, to term. to forward,

really we'll XXXX think year I levels by have XXXX again move XXXX, volume think ability and above back the XXXXversus after driving sales the volumes and and XXXX. volume production in to the levels the production above I sequentially driving reduced

Jason Bednar

That's you Alright. helpful, to Got And come that. guide dollars to towards year it. incredible just the some do going for that this spending Thanks back for are then, John. Access. OpEx and Vapotherm have

for Vapotherm And on people spend product these that the you doing undertaken you have costs? some or spending Access are the efforts wise product thinking that are here? development maybe about initiative. to of fund infrastructure you cost, how on ROI guys or software development other those incremental you're some that cost, Wondering like where the dollars looks spending Are then, relative Thanks. more there incremental to targeted? if being it could So just maybe

Joe Army

Yes. Jason. Good questions. Sure,

we all well initiatives sure deliver in we're board on as the it as the these necessary those patient outcome of well. investments it's Post Access in Care means you to building Vapotherm terms to across the access making, and care that - infrastructure and think a out the broaden outcome, about think marketing areas, setting, available the support we have hospital-based patients the infrastructure touched to lot economic potential hospital a patients to a post around backbone from on message So, that I of all what a to the and as clinicians, as making

evenly So, of sort those. I it's split think between

potential could about on the As at There will implications with par be this make to top-line ROI about year. which as some Access a do for conscious it. business ROI, for to investments investments our we new need Care product decision at we introduction a downstream, downstream to But Post us, look we that we is why Vapotherm drive favorable platforms. with very least next-generation that made think our a from what in we're excited it perspective the make

Jason Bednar

much. Alright. Thanks so

Joe Army

Jason. welcome, are You

Operator

Marie line comes the follow-up a have from question from We of Thibault Btig.

Your line open. is

Marie Thibault

now bit to of a used And your of hear base, going we a little to of Thanks. training Wanted on in a of know installed sort are try units units follow-up focused you Thank third U.S. in about lot field forward? to are at sneak the what of making are putting there? outside the on ensure COVID try here stickiness the to I internationally. a I international. look you. When your the that some of about I but placed Hi. in to that, you efforts today, investments sort are What teams wanted

Joe Army

the dealer model, the And in a focus and running direct excellent around hypercapnia. are Through XD We're same with plays in on UK. through the materials. That's more the question. an you, we many of that in our U.S. Thank Germany them businesses Marie. providing them XH we're running

We clinical and in have Brazil on of number also for ground Mexico, the example. people these a markets including

the Japan. the people have on of We now the have people in East Middle parts in Europe and in ground other and we ground on

through And so, that basically other it's those provide but places, same in support share we place. dealers. ground to develop that and running our practices to is that on goal the clinical dealers continue We're through the it our best

Marie Thibault

you. thank Again, Alright.

Operator

to this at turn Joe Army closing are the time. no like to I remarks. Mr. questions back conference further There would for

Joe Army

you We again And we quarter. you very it. want you progress appreciate our great much. updating forward in on really Vapotherm. interest day. Thank a I to for your to thank all next look Have

Operator

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

You may disconnect. now

Vapotherm (VAPO) 10 Aug 212021 Q2 Earnings call transcript