STXS - Earnings call transcript Q2 2021

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ConferenceCall Participants

Adam Maeder - Piper Sandler Josh Jennings - Cowen Frank Takkinen - Lake Street Capital Markets Jason Wittes - Northland

Operator

Good morning. Thank you for joining us for The Stereotaxis Second Quarter 2021 Earnings Conference Call. Certain statements during the conference call and question-and-answer period to follow may relate to future events, expectations and as such constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the company in the future to be materially different from the statements that the company's executives may make today. in Exchange our periodic Commission, Form or described the filings report are XX-K and Securities including XX-Q. risks detail public in within on These our latest update statements. to duty no assume We these participants have At this time, been on mode. a placed listen-only all for be presentation. and comments The open following floor questions will the

is CEO over a host, to As It David today's of to pleasure Fischel, is call my reminder, and Stereotaxis. your turn recorded. Chairman being now the floor

David Fischel

Kim everyone. robust Thank Chief Peery, strongest you, by good joined second our delivered morning Officer. we I’m absolute operator, growth the In XXXX. Financial today and our revenues quarter, since and

revenue to continue up up year-over-year, sequentially a we systems sales. depressed Renewed approximately Year-over-year and return are X% from first the robotic growth of up benefit XXXX. As innovation is quarter in of wave of particularly robotic the XXXX system second significant plan. was from our a revenue strategic adoption of quarter second XX% by inflated quarter XX% comparisons current of but

establishing are initial of a in China. the confident read Model S system in quarter rail of electrophysiology program robotic a reported shipments that the robust new to lead growth. of robotic to the multi-year sustained a in proofs to a strategy will States, hospital are electrophysiology System program to and in the reflect as and system new hospital United Niobe as revenue well strategy Genesis establishing We pleased a period

two contract partial reflects these deals. portion of and reported systems discussed from revenue a is shipment upon overall the the on recognition As prior often calls, triggered of revenue value

China head-to-head year. a discussed as in to and in They're significantly the partners from a This the new study will new the of a other specific in renewed practices procedures. reflection level and China prestigious first XX XX systems robotic one U.S. procedures Beijing. two these is orders interventional During nearly very be And orders centers in high robotic strokes this experiencing is that are of for the second two hospital, technology a This large we cardiovascular and acceptance success was silent robotic interest second believe strategic our establishing with order business. inhalation and third robotic globally to cath year. conducting China. years. geography. other customer Zhuhai hospital seeing of are Beijing interest we for we program, and our our China medical adoption lower in labs after from rates systems. most manual of broad our a strategic Zhuhai relationships allow of China One in pillar China, that performing is quarter, observing previously We as for over Thus, may emerging strong a that emerging XX,XXX a versus with that electrophysiology show received geographic in

we We when any any will fashion uneven on forward interest to Genesis. call orders that in projections makes enhances to I relationship additional appropriate. of but a pace see look in announced quarterly recognize continue the opportunity long-term details individual sharing enter difficult, and prudent into our significant

we quarter, XX to visits XX hosted the During potential new separate of customers. which were TeleRobotic

lab of from customers the for months, replacement the now last establishing five orders which depths nine the seven from hospitals were robotic pandemic. multiple robotic that activity increased systems, received seeing during of Over we projects We're greenfield programs. new delayed

robust to XXXX XXXX. double-digit in a are to XXXX of expected and growth projects. near contribute reflect result remainder early expect a revenue replacement received We year XXXX doubling of cycle and approximately revenue in the in system level Orders next of normalized to

across program, various we Myriam end. business, establishing of we foundations new year long-term weeks that are our Commercially move to headquarters technological roles independent an will were an welcome ago, allow and pleased expanded commercial, we our operationally, fellows to track Curet our as investing experienced member. the growth. new and at As addition leaders for to and in we on grow announce Two are operational several expand Dr. the into Board are particularly organization in excited to continue

submissions a XXXX, of complete letter a contribution U.S. and force plan. delaying for and in as experience seems in Osypka catheter for study. across this We challenges, we be has majeure the at long-term in Surgical innovation regulatory and epoxy robotic approval is highly some robotically supplier the executive for submissions that strategic magnetic for ablation of allow in previously next of third the like has second and Intuitive partner Europe July, but to are global European have For Stereotaxis leadership wave our through potential processes impact. manufacturing have from surgeries. transform IDE and with however, European the complete needed the as the will look in disruptions catheters XXXX. addressing and and navigated intuitive we've Osypka. hundreds strategic in U.S. Technologically, And from now plan. with believe advancing pivotal interventional a and received to necessary testing Most submissions phenomenon. a possibly This our aggressively We early beneficial approval represents revenue a been done year. to a we medicine innovation wave advanced for and recently, they and chain our caused confirmed regulatory catheter shipments. grit approval manufacturing testing manufacturing trial our those second U.S. in progressing the expect catheter creativity, delays The specific been glue, laparoscopic Supply disruptive

filings to product present will be these of should several and will technology regulatory work given independently to in third This We both our detail and expand new to more that energetically we the of our the several end partners And XXXX. accelerate innovations, with in believe and on in this in into continue markets. electrophysiology of progress. at adjacent adoption a position launches year. our lead wave We new robotic

We provide our foundation. before now then opening some the physicians, have stereotaxis few these results, a confident on and impact to in are innovations will then the call comment well financial patients, I'll financial Q&A. as Kim commentary and on positive will providers, make institution financial

Kim Peery

X.X Thank in million and a increasing CEO for of X.X of This reflect you, long-term XXXX quarter increasing the second gross rebound of stock X.X The a XXXX million in to recurring increase increase quarter of quarter million performance compared delivery quarter, compensation system in in revenue, pandemic morning for an expense. in includes with increase the XX%. was but System quarter. Revenue delivery and year the prior year a good everyone. last revenue and of second and David, of margin and U.S. the prior margin non-cash was expenses depths securities quarter XX% price revenue volumes and sequentially, XX% from system from totaled revenue second year the of driven increase non-cash the million X.X revenue a of compensation million, the the by second recurring numbers X% previously of from increase accounting for and Niobe second Genesis granted, the a XXXX. system XX% Recurring it's of stock stock XX% to X.X China. announced million quarter. included the gross procedure the quarter the second reflects the for the margin approximately X.X of plan. Gross does Operating of not

and forgiveness for measured from expense up the operating expense and year adjusted compares million X.X million and X.X loans. compared stock quarter. project adjusted X.X second million million. had prior million and Net is to excluding increase X.X compensation beginning XX.X net were income, quarter, X.X adjusted Negative stock both of across loss quarter to million. flow of adjusted loss second in non-cash the operating negative hiring loss second to cash compared the quarter in was compensation call of protection the The for million for the to X.X the X in to the and adjustment the cash a and Excluding of with paycheck year R&D the million free the negative X.X net spending. functions for were loss now million quarter favorable positive the net year. operating prior I prior Operating back operating were consistent in second the million David. and the in quarter of million primarily prior key X.X current June we year, XX, in expenses equivalents hand XXXX cash X.X At X.X reflects This compared X.X expenses million million reflects and company Adjusted sequentially. will loss year. the

David Fischel

Kim. you, Thank

the on expect now approximately today’s to-date. XXXX mentioned of robotic orders received based for system in we $XX revenue we As million press have release,

XXXX robotics XXXX, interventional We in to early and for during double-digit we remainder foundations contribute to established a electrophysiology across of adoption Stereotaxis of the revenue to phases XXXX. in XXXX early result in the approximately turnaround, robust revenue in expect a growth in of remain XXXX compared as the doubling and multi-year overall medicine. received orders in system and significant of

we fronts We are to advancing financial advance methodical in are discipline. fashion in are able pleased and while a multiple that our tandem strategy maintaining

over reach cash best Q&A? the continue able This but robust additional position without the sheet have we to our the line now the company your so while these balance our to expect quarters. been for profitability forward essentially look investment you infrastructure team A and can Operator, do the and in to maintained us allows are reflected breakeven. increasing continue identical last run We questions. four to have please to technology need is investments and We to open financings. in continuing taking near

Operator

Piper you. from Maeder [Operator the first Sandler. Adam We question take at Instructions] Thank

Adam Maeder

solid Congrats on the quarter.

to system guidance and XXXX. wanted just the commentary First, on with start the

installed expect about double little capital second, what just kind those have revenue So up? you funnel in back gives just talk it double the year revenues, should the half XXXX, a and the the sales the bridge there year, visibility then we to of but you next confidence sounds a million this more system first, confirm in executed. And like a then, year. can the system roughly of follow and for been David, maybe you that in wanted had about that. think And we to base as affirm XX And us orders bit

David Fischel

guidance recognized revenue received year that guidance of revenue and revenue will the year, recognized proportion reflective at as as systems that we're we for this when this today, look the the the So revenue those be be confident for is orders then that system will capital year, still. to-date, this that to-date we have of

that in given kind again, that But we're number us the some is for potential of in number. that so to number. to likelihood of that significant There's August, confidence low. And gives of the having that upside kind upside already

delta revenue. in As be digit confidence the the activity replacement year, preliminary we year that have or little confidence the cycle. more This then, do replacement that year having next is activity should level be have between for very and the multiple a level replacement what single that sites. from there is, from And to what double just with And would XXXX do systems of revenue. cycle guidance a have we XXXX we're several normalized guidance, low normalized would less significant system or just more revenue we cycle the from and high amount digit, this

quarters announced that like nice coming pace we we discussions us. kind with gives revenue so and shouldn't continued next surprise that to And us as new go year. should of we into have confidence with to again, in that a potential of the quarters trajectory lead that customers, be March able be And the last ones along to should the

Adam Maeder

out top helpful. David. half bit for ask wanted year That's Got line playing maybe little the about very how see a it. up of the perspective. Thanks, follow a just you the And to back from

some here volumes any or around both snapped revenue side we and progression nicely cadence but in then the of seasonality where, of in quarterly on also QX, back have in potentially color have Just on QX. and AF recognition system delta then terms disposable side sales, the

any just back questions. thinking year the half and the strokes, So so how about for taking thanks broad much around the you're

David Fischel

Sure.

getting the of But, shouldn't So to impact. well rebounding rebound, similar and few on two hospitals in a to have But towards it look the shouldn't to revenues if procedure, seems southern a that probably definitely a world, how Delta. of the back similar is tough little gradual kind the have a what Overall, big to fourth it's the described, the going disruptive quarter. last at that half And just that you of of be should year. the disposable XX relatively the think would very that's now Generally, and with quarters revenue. exactly heard have of see fair revenue, of there's some quarter think guidance to so kind overall prepared go. kind system and estimate I disruption there incrementally we we see pressure, bit normality million that last I the big the would that to as reported hard, like it are third kind between what of recurring rebound out particularly and estimate for weeks us it that of impact states we've we our that over few are generally, year, numbers

Operator

Josh Cowen. from Jennings will Instructions] [Operator question next We at take the

Josh Jennings

of the launches and filings then it these you accelerated filings? seems third we just to And like drive these approvals? even you be can [indiscernible] us disclose these to I XXXX timeline, was in on But data the but these any, or new wave in indications provided indications these will commercial filings with new clinical outlook because you or for coming for innovation should data indications, comments bridge product expecting type the need, exactly help what start traction? months do be. new hoping but of updated what off if before But for also an and

David Fischel

great Sure, question.

discussion next of discussion guess, will wave one is And a be comment of not indications. so exclusively maybe that I new innovations of preliminary the the

electrophysiology will general there technology space multiple be new aspect will expanding applications. to of electrophysiology to an that how about the and updates. clinical there starting into we're to or be So address adjacencies But updates more also related

in technologies a so talking in to questions just you specific it than would expanded typically about there think we're about, humans, approval. study not the it is that I clinical And indications. for kind you order data data, in think the have clinical most Then in of that on about broader regulatory to for requirement the of think way larger a pursue of

And to not you're important the through literature data as announcing clinical going think related indications, adoption expect next you should you have those, as And few phase. press so that, we're release think right in months. some you go is the a building to about that new particularly clinical I up

initial the leaders kind that do in during And we so that will course that are be who really launch. that something be field. of that the But of with focus adoption kind on of something initial adopters will happen will the

Josh Jennings

that Understood. of on indications next demand There's innovation these in or the of Thanks And assumption there. that third kind but thinking in wave for about on XXXX. new help from year. potential revenues system doubling tack high-level baked that's commentary this

David Fischel

does not. That No.

commentaries and existing our guidance based business. electrophysiology revenue the So is on business

that and that be initial would something we of We innovation, mentioned this not regulatory expect this of in submissions guidance wave at third point. expect but kind call, as revenue in would the we from include

Josh Jennings

Understood. even it they some like stated, is versus has cerebral if in, in I this the been terms a the Niobe, emboli further data center, order manual study Stereotaxis that? taking the that the performed of electrophysiology in that proven that believe and And for sparking a big lastly, in reduction that And be on Is after a magnetic can you be for you demonstrated asymptomatic, Thanks deal published? Beijing seems robotic, community. It could build questions. can about demand ablation navigation commented events ablation. then,

David Fischel

data been has dramatic The all Sure. yet not over we've other published. with study shown the I agree that that time. pairs and benefits nicely it's safety

pre-op details of sharing of was the and MRI dramatic relatively every to much again, study, showed too somewhat in those robotic of in strokes. silent all versus was data and it between manual seen discern designed abstract two looked we've number it post-op and the nicely that a very of they publication it severity that patients. kind very, the between difference the So images large the But in to a MRI, kind careful submitted rates between are not for strokes it, And been arms And the two authors. be of in had it's differences dramatic a the patient differences by have or for of I ablation rate ablation. the silent very

I physician data. that So community gets hope to we point that have in near it the we and the what more But published to, our customers term. investment can, gets community And to published. obviously, wait importantly, until it to and

Josh Jennings

you why can couldn't Thanks would with sense I in refresher or myocardium follow and of robotic silent makes cerebral we mean, it up But see lower magnetic a contact why lot. that I -- asymptomatic and mechanistically just he on just one maybe emboli? because a give us I emboli. deliver rate reduction strokes think continuous quick catheters a could navigation the just

David Fischel

Authors kind cause that One be seem the can heart can the drivers. kind kind of kind the of reduced couple better of will that's it kind I the catheter, again, two shop, gives in likely by risk of that kind beating which to you're makes that their as the mechanistic things a driven publication. But less design that against of stability about. of of magnetically driven ablation think it a ablation to And harm. is of the and of And gives stability of the think off navigating, the discuss knocking softer wall. it you those against I emboli than

Operator

at Frank comes Capital Street Lake question Takkinen Markets. next The from

Frank Takkinen

have you now And fiscal wanted need a and to be hand 'XX many call bridge the more with fiscal XXXX. to little get in in then, bit guidance, between do ask you orders to if to double now of how recognized start I in it us to wanted in additional XX? more to many that double system you system Just sales mid-XXXX just specifically, orders year year how right could

David Fischel

to-date, which announced year their revenue this will seven recognition initial we've So XXXX. all in robotic of orders have at systems, for least

But in will be XXXX. that So portion will that recognized be for of XXXX. the of each in a gets systems there seven amount revenue those predominant

And ones in middle let's yet. the expect through And those through year, months say, place don't next any come of now of will generate that orders the to that guidance. XXXX have coming Those we so middle in, take the XXXX. are the now orders it's of we obviously that will from,

that's we're And the math, that of at way kind systems mid the looking look get so to things. And low you roughly looking of type in than to if at at double-digit you're revenue. order to

Frank Takkinen

Got it.

And systems that makes a the guidance. wanted fiscal your more comments XXXX. expected about heard the 'XX. new little to of replacement To then in year sense. ask I sounds 'XX cycle getting back greenfield like year that Okay, to me, I versus more on just bit mix normalized entire fiscal in a almost

thinking wanted of just understand kind new specifically 'XX? I in versus So year to fiscal greenfield how more about you're

David Fischel

look look to you next of number systems if systems. seven -- that, at at have year. you an And greenfield So mid a been income this system out say five Sure, teens at had year, we've let's low let’s say as the

number at let's get the systems, from cycle, of and to digits, year. at we you'd of If look feels reasonable, of looking value for mid then that of a greenfield the And next low that to high to way that. of long-term number from both bottom teens on that you systems would reasonable a is kind single the at it, reasonable the replacement increase cycle we're you look systems in roughly that and look similar a replacement project. from feels a when what to But up like say numbers like the hard top down feels Again, going trying number recognized greenfield overall through to systems, we assumption. if work

Frank Takkinen

Perfect, the me, third ask the innovations. third of the and or wanted just second crystal margin for clear. Last on to one profile

you they're provide of the are Looking gross in feel at innovation the XX% your as the the similar well margin to products consistently, side strategy current with catheter the going as recurring do revenue both disposable if margins broader plus business?

David Fischel

at they that -- bit disposable medical at will disposable they products medical be tier I tier always not will gross the self be and tiny top developed The but new products. margin XX%, be be of sure I'm we volumes wouldn't gross top margin. gross least device they at will that device if initial lower margin significant expect volumes, so might

Operator

at take [Operator Instructions] the We'll Wittes next Northland. Jason question from

Jason Wittes

First off just clarification. a

approval IDE, just mentioned I was think that was could U.S. for XXXX, clarify? you if U.S. for you that or

David Fischel

a was approval. That potential U.S. for

Jason Wittes

us of number? terms you what kind assumed through et in the that's submission So that, can timing IDE XXXX of that does and walk review, in cetera

David Fischel

Sure.

the the So let's if trial the -- relatively say IDE we a start be beginning in enrolling and follow it in a application rapid U.S. year XXXX, relatively patients, submit middle and enrollment, up. of rapid started should a of

to the let's data, PMA approval a the up. of you time have on submission say later, nine kind immediately when to approval. can You for the be that and potential of gets the of into heels months kind would submission that And FDA last six with XXXX then follow

Jason Wittes

of very helpful. the XXXX? up mentioned anticipation for beefing hires, this Also, made sort the support it you're in Okay, terms business building the you've this you've some to is expansion -- is like or that -- of organization, of current recent sounds

David Fischel

scale, is a to out to capable think you to infrastructure can of It's works do kind business having team that much and and kind that can build really is infrastructure And well we to business want much more. of and looking and more a wanting competent the have as sizable of the together. grow growth that and about do that part

how have system commercial and increased can both sales, really that help can build come innovations new scale as at obviously, system and we team out we're new drive commercial so we the And side, on looking sales. to a as

relatively team -- R&D that the a in amazing fashion. been have amounts a lean side, able we On has with to relatively do

set place is order use that I operationally, good accelerate magnitude foundation then, to want taking shareholder are for And the company capital. be various of and modernize think, innovations of can that a to the so really in we a And any ways larger.

the explains think that some find will move things who recently play like and good role joined individuals and we've and improve modernize been things. so to to office in And this new us have operations, a across we And that. to fortunate desire that our

Jason Wittes

That's a sort follow your kind summarizing of correctly? terms getting Does helpful color willing revenues sounds kind you've Okay. it aggressive Or a spending to your philosophy more of like to am lot of breakeven somewhat? increase in still year, of bit imply that of think there. that would had a to the kind burn spending? Your of you're how next you're going profile It or -- is year? next that you relatively I keep about it thinking

David Fischel

investing think an generally, feel going to and -- of would growth that in drivers kind I comfortable improved Yes. we're of we drivers of business.

been over while and in company burns we've as our for we're business row. no essentially, both so last investment business. right increasing the thing a to growing period, amounts for the where type year, you position. in operations. But at way we've financing concern term that rate burn going four quarters not been we've really had be the in over any it overall over looking We're significant of now, That's what's longer money our see, a And there's the of the flat,

something that where we're positive if something small do in to that's a be a to a We're investments we specific do from we're leads find business, going things for have to to that macro managing And We'll business the try burn, any want growth. impact on very of stable us so quarter, will Stereotaxis investments long-term position. I And financial a that invest managing a to not are we're always it. keep meaningful don't we exact kind so And ROI actually will all prudent If these a opportunities maintain I the that anyone breakeven of hold have quarter similar. that. because we in think way. of in perspective. to more, kind

Jason Wittes

But in is some maybe we of Okay, that how should contribution to up. you and they how follow XXXX? Stereotaxis project see outside contribution, probably EP. in there very launches some It's since. going possibility a -- mentioned, thinking to performance know, meaningful even adjacencies into Or next launches be part And about then play quick we'll that's helpful. these a for just look you're some a year? I hard

David Fischel

to meaningful I for guide wouldn't want revenue.

so why that's in some kind meaningful anticipated And think these experience. guidance, some we expect But I from revenue revenue initial XXXX. real-world initial should the in revenue, of launches we have

Operator

questions time. there I'd appears It at Instructions] call are [Operator to no this back further Fischel, Mr. like you. to a turn

David Fischel

very very support. your your for questions on Thank you look Thank much. Okay. the to much hard forward your continued coming behalf you working speaking in and We months and again next quarter.

Operator

you call. This Thank your for participation. concludes today's

You now disconnect. may

Stereotaxis (STXS) 10 Aug 212021 Q2 Earnings call transcript