PEN - Earnings call transcript Q4 2024

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Operator

Good afternoon. My name is Rob, and I will be your conference operator today. At this time, I would like to welcome everyone to Penumbra's Fourth Quarter 2024 Conference Call. [Operator Instructions] I would like to introduce Ms. Cecilia Furlong Business Development and Investor Relations for Penumbra. Ms. your begin may you conference. Furlong,

Cecilia Furlong

year and Thank reconciliation, our financial us the tables www.penumbrainc.com. all of can full joining at which on includes to viewed you today's you, fourth press call non-GAAP and and for be operator, tab on release to for earnings under company copy Investors GAAP thank website discuss release A XXXX. a quarter the Penumbra's the

statements XXXX, forward-looking to call, Securities performance, the regarding status, During harbor trends. and regulatory company of the our quality, the trials, course this provisions business make safe of Litigation conference will Reform including financial pursuant the Private compliance clinical Act commercialization, of statements

our those due uncertainties, December on Actual to risks XXXX. filed and in forward-looking referenced XX, certain scheduled be results the the differ implied with statements XXXX, from could to year including materially XX-K those our SEC for stated is ended XX, which by February or

we our As SEC, including undue you for periodic the that factors the with caution and and of reliance filings discussion price to XX-K stock. or affect review other a previously encourage our complete statements, forward-looking you may a the mentioned, we result, future these these results our on placing more market risks against of

million XXXX operating Italian information, $X.X exclude duty non-GAAP profit, gross year update full a new or operating revenue, any income reserve events, gross future payback statements are pertaining call, legislation. and and margin of or results to result developments QX disclaims On as Non-GAAP Penumbra revise our margin, to XXXX a a forward-looking basis. on otherwise. financial this

expenses operating Immersive financial measures of business expenses operating year and income associated amortization of wind finite impairment of non-GAAP down are tangible release. litigation million our addition, non-GAAP posted $X.X charges Healthcare and GAAP measures reconciliation XXXX margin $X.X full expenses assets expenses million $X in Immersive The million GAAP $XX.X corresponding press ] In nonrecurring with of operating Healthcare of [ of the of to and million. provided exclude

Elsesser, QX, down Penumbra's respectively, our payback for full our our compensation depreciation discuss XXXX will litigation-related income wind Healthcare and XXXX a Yuen, reserve, Immersive care expenses, EBITDA for Adjusted and full the then update. for Chief amortization, year stock our Adam care nonrecurring expenses. and results excludes impairment Chairman CEO, Jason onetime Healthcare expense, taxes President expenses, and interest and provision financial will Italian provide and Executive charges, Immersive guidance. will XXXX, XXXX; Financial Strategy, Officer, Maggie fourth discuss Mills, the of Vice business quarter year income

turn like Adam With that, Elsesser. over would I call to to the

Adam Elsesser

Penumbra excluding Thank quarter, year-over-year when growth revenue of the Good joining XX.X% constant generated you, on Quarter Call. basis. and afternoon. payback for Representing we Cecilia. Fourth Conference fourth XXXX adjusted Italian XX% a the In on currency Thank basis Year and million $XXX.X of adjustment. Full you an underlying

the quarter U.S. our and another growth CAVT throughout $XXX.X exiting VTE year XX%. franchise, strong year-over-year XX.X% performance, thrombectomy growth. and continued U.S. position. to to Fourth our delivering our year-over-year million. Our proprietary gaining thrombectomy lead a portfolio sales quarter revenue With the robust With in delivering dominant U.S. comprehensive increased momentum business of

very our continued with well of in perform to expectations. thrombectomy franchise balance The line U.S. our

increasing versus XX.X% overall billion, revenue $XXX.X full increase of $X.X to year solid revenue year-over-year and and business performance ], capped XX.X% quarter XXXX million XXXX. our delivering thrombectomy U.S. over fourth [ Our with

X Europe continuing to the high-quality products health and support to support Lightning including from presence expanded and in X.X, OUS to optimize value, expanded all our highlight introduced we via invested and Bolt long-term footprint year, evolved commercial the During economic growth new generating Internationally, business and clinical CAVT's commercial further XX. We steps Lightning team, our exit Immersive track geographic enhanced profitability. concentrated our into our while and to and interventional with on new focus additional we Healthcare prioritize market, our innovation. and CAVT's products, the Bolt CAVT to and XX Flash geographies U.S. took data

revenue in XXXX basis At over income period. the In quarter, operating over same cash. the XX.X% the of while the points operating the year million XX.X% prior $XX.X our profile we margin time, basis the of also million strong demonstrated or In prior points of gross period, fourth increased profitability of XXX year quarter, generated business. $XX.X expanded

achieve which is to gross previously track XX% foreseeable outpace time end operating on with line the over and profile are expect communicated, by margin we we the forward, to and the consistent future. for a gross expansion margin margin XXXX, Looking expansion of we

shift, In to operating continue to facility our signed expanding profitability efficiencies and forward. spend capacity. efficiently Costa addition, disciplined we operating contract going a recently mix manufacturing product build and increase a favorable cash we to for manufacturing Rica are well leveraging in flow our positioned Therefore,

deeper Turning versus adoption to fourth Namely growth well & technologies. as X.X expanded quarter our analog the lead continued overall to in VTE as patients, penetration. with driving speed physician and removes interest the Lightning account broader cuts Flash U.S. with peripheral its Flash which blood safety and in business. and X.X competitive benefits

fourth VTE our to the Overall, venous and to generation market VTE performance, Bolt roll acceleration December sizes. representing vessel and procedure latest franchise we in our month commenced vessels, including these provided our knee. our supporting volumes broader commercial of positive, Bolt the commercial arteries smaller a XX to momentum Bolt Initial out introduction to solution U.S. has been continuing in In CAVT technology modulated proprietary on gain feedback strong that larger arterial we fourth the look very offering to the growth quarter expanding Bolt and continued the are portfolio's U.S. Lightning Lightning also anatomy in of CAVT forward below with with tera-focused scale arterial XXXX. introducing ever. the contributions XX, quarter, our reach quarter, for technology franchise. our sequential the initial X aspiration throughout arteries, highest share In another Lightning delivered the rollout business, XX's

early both is the on feedback positive. portfolio increasingly XXXX, arterial from Bolt patients use view treated opportunity to for and of conversion accelerate XX we from comprehensive combination our our And than looking and open XX to of U.S. in December, arterial X or Bolt suffering meaningful in physician any to While the Similar we to a Bolt CAVT prior surgery CAVT. Venous month. our lytics in more business, clot the and

faster we VTE are in technology analog early technology. in said, our of treating mechanism blood U.S. and stages proprietary clot. That than The XXX,XXX CAVT consistently safer arterial reaching who over and from and the annually of the suffer patients clots remove the

analysis we the awareness, greater CAVT's PE analysis retrospective to our Vegas, to resulted by significant the of the session CAVT only to the at to of some in nations systems. As intermediate to patients, benefit November, of Dr. of compared well with mechanical are results as clinical Las of improvement CAVT at anticoagulation. number arterial market during a of either Patel venous hospitals. highlighting and first initiatives. as directed treat in latest reduction the economic Treatment Parag Conference look of and the composite in CAVT's with as reflect forward or also what to patients market forms complications benefits, well benefits the data lytics even intend in risk in CAVT presented initiatives We Patel looked we economics update as for public and outcomes internationally future. ability further refer Catheter a to other our clot late-breaking Veeva but our treatment or focused X.X's Dr. thrombectomy. our burden. generation demonstrated view treated not the presented initiatives. modalities hospital the the on access past greater outcomes Flash The that technologies To increasing reach, The other commenced to expand with continue These access This

arterial our utilization in at conference major DVT business. present next and Shifting focused we ahead, Neurovascular additional sets data are in scheduled a on months. Looking to patients to few CAVT's the medical

Our posted business once U.S. with third results the versus accelerating strong quarter. revenue again stroke thrombectomy

we market-leading bring year, proprietary aspiration FDA-cleared looking grew are growth. Red with underlying XX% versus nearly Red full And alongside to We center of XX, U.S. market XX portfolio, led dominant our our technology RED by XXXX. forward, RED as ahead enter the preparing XX And RED XX leader. market well and Thunderbolt. the For and growth, XXXX stroke XX

Our technology to December, future proprietary completed additional trial in as we expected provide our THUNDER field, will updates neurovascular late the in as appropriate. and follow-up CAVT

and technology the to delivers vascular, clotmorthologies the a of with ] proprietary procedure. peripheral benefits which range can speed our technology We specifically have simple extract seen in safe patients [ the with a Bolt

new to treatment We to a are bring technology thrombectomy. and the position further field chapter excited in this our in in ushering stroke enhancing neurovascular of the of market-leading the stroke field,

entered driving technology are a digital. shift Behind With to we with We from XXXX momentum. our CAVT, significant portfolio. CAVT analog

and organization We focus. position able both to and intensely our CAVT additional access to on thrombectomy meaningful are leadership the augmenting embolization opportunity for be positioning our in also commercial while focus ahead through innovation

strengthen our clinical our demonstrated we data in profitability XXXX, and increasing commercial we gross thrombectomy deliver innovation, while drive company. and investing in to position as and to economic As the expand leading efficiencies expansion team margin continue and and operating will aggressively world's health

I'll our go results full Maggie fourth for year financial over the now over call turn XXXX. the and to to quarter

Maggie Yuen

medical Good full financial XXXX. Italian excludes constitutional on device from of will Italian on a created medical . $X.X the legislation to the and to as Adam. on upheld was afternoon, fourth budget to Financial by including this Cecilia, highlighted government's you, pertaining year recently deficit for XXXX over reserve the adjustment [indiscernible] everyone. by which the spending basis. to discuss any XXXX, non-GAAP requiring I are the which call devices contribute the Thank quarter Today, results Italian results million by companies

have prior Given reconciliation posted related and calculating release. financial normalized GAAP that GAAP anticipated press we our this measures in to are provided when of revenue non-GAAP XXXX. to our a for growth The for corresponding amount this amount measures years, rates

quarter quarter million, XX.X% and adjusted constant XX% the ended of fourth XXXX. XX, an to the $XXX.X XXXX, were total in increase compared currency For revenues fourth December of our

quarter fourth international. XX.X% mix XXXX of the Our for U.S. sales XX.X% and was geographic

reported in region U.S. driven by XX.X% our growth Our growth thrombectomy XX.X% franchise. of

million, currency, due regions. to decreased decline increase China in Our international and X.X% international in adjusted primarily $XX.X an $X.X other X.X% in million revenue regions constant all by of partially offset a of

The an internationally. thrombectomy X.X% was by $XX.X in our growth sequential of increase flat revenue driven in revenue revenue relatively U.S. million primarily total of and

adjusted XX.X% business from million product. XX.X% same currency by An of Revenue last the revenue $XXX.X global in the XXXX. constant to fourth our to Moving of in period thrombectomy and compared grew quarter year. increase to

Our is growth U.S. thrombectomy. growth XX.X% in and of to strong both primarily neuro vascular due

the declined decrease and access as XX.X%, offset business primarily an was other increase same with an X.X% our partially a $XX.X year. of in Our adjusted currency, line in from million X% international revenue U.S.. the to million international of embolization driven China by increase the in of $XX.X is in by expectations business and Revenue in last XXXX, fourth increase regions by quarter in which period all and driven an constant primarily and compared

across XX.X% strong the margin the gross for XXX for had year. new basis mix to XXXX, regional thrombectomy the by our driven compared product quarter XX due represents quarter point point was of compared improvement XX.X% favorable fourth revenue for mix same product to last to a is thrombectomy improvement and quarter quarter revenue expense Sequentially, or $XXX.X which of and of higher which $XXX.X all Total we million favorable basis mix. XX.X% an or fourth in improvements. million margin reflects XX.X%, operating launches product for productivity XXXX of regions Gross the

Our research $XX.X XXXX compared QX, expenses million for revenue XXXX. and X.X% were or million revenue development to QX, for or of $XX of X.X%

We last fourth increase XX.X% revenue or to for recorded compared period posted adjusted operating the of XX.X% revenue income total Compared an XX.X% revenue compared currency adjusted constant QX, $XX.X of revenue of income to for year of which year $XXX.X of QX, full million million XX.X% $X.X our last or We million XX.X% or of revenue. XXXX, for quarter in XX.X% and same or to XXXX. or XXXX XXXX. $XX.X $XX.X of million Full were million compared year. operating full the of $XX.X SG&A an total billion, represents was year, to XX.X% EBITDA in year. million of expenses $XXX.X for revenue or the

geographic international. XX.X% mix were XX.X% sales Our of in the U.S. year and

of business global global the from constant constant to thrombectomy was by by XXXX in was For international $XXX.X of our increase adjusted primarily our from was an vascular for offset growth driven XXXX, full $XX.X our and in year embolization decreased and adjusted regions business, million. constant of growth the for revenue of year Revenue the adjusted business access year XXXX full X.X% and all million, XX.X% a partially from while currency. X.X% Revenue increase of in regions. X.X% our X% and in $XXX.X currency, thrombectomy reduction due full million, an other an increase reported in XX.X% primarily U.S. currency. of international China

full expansion to write-off XXXX. year of XX.X% over full this in to of onetime our a Healthcare launches. the gross of which operating year the point gross in to XXXX. the $XXX.X We margin for income and onetime was XXX which XX% of This In item, impact removing for Immersive $XX.X for and XXXX. for compared which new XXX year margin point product basis basis after million, XXXX, reflects mix, compared million improvements support margin inventory million includes a includes favorable onetime target year had revenue gross $XX.X We productivity continued to to product at Healthcare Immersive XX.X% XXXX. least investment thrombectomy $XXX.X full income operating had write-off inventory million for Our

business, winding GAAP we are And we annualized of create approximately to track $XX operating GAAP still down Healthcare Immersive on and update to impact savings expense of of approximately had expense provide the XXXX for million an on $XX savings million. operating

XXXX million compared in last of was total Our XX.X% revenue $XXX XX.X% year. EBITDA or adjusted to

range of Looking margin soon a XX% will total forward XX% to to Jason to operating we to XXXX, forecast expand discuss as of revenue.

and quarter and balance improvement we is cash We positive and of Which beyond. continue $XXX.X $XX.X ended balance flow increase driven to an and cash the strong sheet. no cash, in securities profitability to XXXX by of equivalents Turning expect million trends working marketable fourth cash flow operating with management. in and sequentially, operating capital million debt.

discuss to the our turn guidance. over like I'd now And to XXXX call to Jason

Jason Mills

Maggie, on you, afternoon, earnings Thank good communicated Consistent second with our guidance XXXX and call. our everyone. philosophy quarter

[ ] of $X.XXX GAAP $X.XXX for which to XXXX is a guidance represents XXXX compared ], revenue range total Our of total XX% revenue. to growth to [ billion XX% billion year-over-year

thrombectomy XX% our range we growth For U.S. expect business, the in of to XX% year-over-year.

income statement. Moving down the

XXXX. We margin and to expand gross expect in both operating margin

gross Maggie earlier, XXXX basis in For the expense after least margin, for than excluding the forecast year. more to XX% described at points of full we expansion onetime XXX

described. XXXX, to expect line, the of in margin XX% for to total revenue expense operating margin operating the year we On to expansion XXXX compared full which XX% excludes previously onetime

with Which expansion expansion achieve we margin Looking gross track gross previously expect to forward, as foreseeable is future. communicated, and for end to by XXXX. Adam the consistent of a on we we outpace profile said operating in time margin the the are margin over XX% his line remarks,

prepared can now remarks. questions. our call the concludes Operator, This open we to

Operator

And question the Instructions] line of Biegelsen your Fargo. from Larry first from [Operator Wells comes

Larry Biegelsen

Congrats on year Thunder. one the here. strong one finish a Adam, had guidance to I and the on on

see we you're you 'XX? XX% So in to And the sales XX.X% delay China. adjusted some I in impact the XXXX. 'XX the given guiding launches, Why revenue headwinds in did an or growth XXXX, onetime in to as in of in shouldn't the XX% Thunderbolt. European think XX.X% Such acceleration

we thinking you those year one getting some a are back headwinds I from the 'XX? had guidance in saw and this follow-up. And of how about standpoint So philosophical

Adam Elsesser

appropriate think I it's And one. question. the for thanks Larry, Yes,

clear tried philosophy of ahead that second be giving think getting sort guidance was quarter, pretty the I that we in in in line this with we about the of to that not ourselves. talked if

are totally there follow-up number Thunderbolt them. we yet one obviously, don't that your So things a of control of being question,

guidance the that. information that to put going So we're we not have more into until around

we we're that and in we year, last through So lot of don't appropriately. that a to, most you're and this going to have of headwinds minds, guide that had our acknowledge year them correct we got

in So last got we don't in year. same we trouble get the

Larry Biegelsen

my it couple and How how -- the should readout That's we for helpful. of ago. just implications should we follow-up and about sounds line see we for negative medium And clearance. follow-up And think is vessel filing Penumbra? Adam, What X like at a time the on are done, Thunder. ISC data weeks the as follow-up, a is did trials digital

Adam Elsesser

Yes.

gets more it of so premature on there. start So on, will you on presentation do put both that just as data in and think you Thunderbolt, to I as to to definitely update appropriate we that. appreciate it when out Obviously, cleared there's you when update to and information guesses

trials, trials it Deja and a relates mechanism vessels stentrievers the distal bit sort it as primarily to was in you to stentrievers opposed as as an vu As of a primary distal little those particularly the know, adjunct. use of used

occlusions, not think part, always particularly and that RED success people For more the of be don't We've really were done about in which I smaller some result. is have not those great should distal talked MX, that large the XX know and using opportunity including distal, vessels. just with something I catheters, most aspiration, vessel XX our primarily, the surprised we had

see as in And I story think part yet. I we'll from it's the that. the in XX the move logical like aspiration studies constant everything, part years written in stroke, watched particularly over primary mechanism And as is not toward we're just like because think

Operator

question Your of from Robbie line comes from Marcus the next JPMorgan.

Robert Marcus

on ask sales minus doing you're my growth it the quarter. I'll seeing there? What a right, business, I and flat XXXX. in of math embolization echo rest X% I'm implies access. to to on the If wanted congratulations good

get to seeing OUS and driving versus sense wanted for what's to think the how what of a just -- there, you're guide about So U.S. XXXX?

Adam Elsesser

Yes.

our when have the access side. we -- coils and incredibly on side access And look embolization We're an of we're really vascular proud market neuro the our part incredibly We're business, So those of the is segments. very strong in at and it. business. leader on you in both an important business that

And prepared gotten we'll we've you think heard that CAVT something And not were interest focus in expanded. my think in those also, the year innovating as done I areas. I that that be our will progresses. on as and in has watch bigger and remarks,

need make we ability that and the focus we particularly. dramatically, have sure to very So to use term I

well. with more markets, there a as a So as the into I opportunities, to demand. expand in By as non-U.S. where where can there's that double markets of successful, sort did lot said Costa is are retrenching, going into markets, the for of definition, a think we're a to go but for There's specifically in facility have short term more basis weren't lot to internationally particularly of see Rica, we last areas that ability appropriate an U.S. markets of be areas manufacturing particularly of the we also we grow. we U.S. cost to these bit little well. on down to successful year, the appropriate, and in opportunity we And our continue and if some

Operator

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

Macauley Kilbane

tonight. This is for Macauley on Margaret

saw the U.S. U.S., we just But comment the VTE guidance, the quarter. follow growth and on So this in the I on Tom wanted appreciate given up to specifically. question around XX%

any include Or [indiscernible] if PE, you does in focusing commentary particular includes versus not and that vascular arterial between and that now help for either can DVT wondering out vascular neuro just parse either launch? Thunderbolt on Just what

Adam Elsesser

we're markets in We that's the focus the is XXXX, guide the outsized of And particularly on driving by feeling you in exited guide. of VTE all out break where a each the businesses. about we But form how guide saw is the XX% for CAVT segment -- the a look, obviously it growth. given don't obviously, Yes. holistic the confident that business. the that number,

the safer. competitor a fairly a of We've kind in still market, the tenacious to bit. that also that we growth able for cloud have out said product because and have gets that faster were and We

same. There, the products are all not

You the and can't that now best that And that CAVT just well have in the as pretty does clear part think market, as one mark. have of current is I be right making it have something that's you to class.

to going ourselves. So growth not of to by much to the more basis, watch guide. -- start year how a we much definition, going we're But be all things update to with as share going careful get is market appropriate. ahead not as be obviously, look we'll want current and And We're how as there, there. we appropriate our on out, them to we those is we're of quarterly

Macauley Kilbane

follow-up, other your the And there XXX(k) was the maybe RED as but just help a XX update or aspect Adam to then Understand. you script. I day, notice -- to status and emphasized wanted in FDA-cleared an saw can the

any of modification should there guess, forward? pipeline made from that was So what to expect there? the bigger I catheter catheters we picture, moving

Adam Elsesser

Yes.

I a I'm that you question. think that fair up. it's picked glad

are we ago, products. the success X of know time. all hallmark of you said our done. think RED of was of never sort I XX lost has We've XX And I've That the launched X, been part years. track constantly years improving what for now we're So better our

update that we've as would developed we've we that that natural it's catheter technology with additional so And CapEx. developed

the is the already got short So We week, making of period in cleared at of our more time. XX trackable. half we've I much just evaluation done, cases RED just the end last this of that roughly think,

it able have business. additional and can this to best-in-class with we're help combine the have that of to impact gets stroke I anything give team, puts in a a we'll opportunity top patients more you maximum the than And add I sales on being us with that faster better our for to market. then And think But cleared, the when number we that Thunderbolt the And clot going contract obviously, to of we catheters you it else go. year having information pretty that, on of as and position a suite help. think good

Operator

Bank. next of comes Deutsche Chickering Pito the from question Your from line

Pito Chickering

obviously rate Looking of they the on at How we XX% to exit your growth year, your the that XX% almost seasonality is fourth was? really talked you which that we U.S. straight should you a seen quarter of we since how was flat guide about comp such growth December high line XX%. and the strong haven't at sequentially number end the about think that the launched

Adam Elsesser

Yes.

me we've Let it's sort to rhythm based There's of can combination little of always Jason mean always stress of seen on and start of sort on. I speak a the seasonality more. a the so maybe and the fourth holidays quarter

the business out. also like again, it various changes, in timing stroke and And That line just talked overlaid obviously, said, for up we that. example, run For XXXX, about to being out goes the but launches things that we've straight things and ability launches. haven't

of pause comes sort can you even come It of then in share for sort more. and taking VTE, you to the answer years. And a it's that many, seen doesn't many to that And in in in baseline, as the or to thing then then take of question many, add stroke With in that in also the some an share, alluded and Jason, way. that add last that. I sort as you are whether color chunks we've

Jason Mills

thanks Peter, for Yes, the question.

which it modeling be sequential fourth therefore probably U.S. or growth year quarter can start was can one at year-over-year a a outstanding sets as quarter of of fastest. which in of As XXXX, in the terms quarter the quarter to beginning biggest that comp, XX% It terms thrombectomy thrombectomy, see, on was you're in business. the up also would you most was you And of from challenging midpoint just see, the in growth within as to can an suggest you U.S. the the that fourth the better. range, the those the XX% perspective,

of fact we don't be the lower from year then more at the loaded the guidance quarter can in of front-end of growth we or standpoint midpoint gave. fourth Thunderbolt sort guidance and so And the have our that a the reflect can

Pito Chickering

the U.S. Okay. volume the Is And should this about volume in terms pricing the just And sticking we on then versus quarter. the color with of there XX% within growth versus think in any pricing what was XXXX quarter? guidance range? thrombectomy

Adam Elsesser

the It's way stage, several ended into At this. in Yes. all not went VTE case and this a And ever to almost we've seen, strongest arterial. both It's it's volume. volume element why year pricing I say with volume. the that's There's this, -- in my we're out years now. of we

Operator

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

William Plovanic

And are asking first just we're wanted to with on process. discussions are any And to additional in Have you Thunder. FDA up have Just yet? you a information, studies? trying any them they Just the One, to submitted I out had to? clarify. clinical three, the I they for then additional figure have including where follow-up.

Adam Elsesser

a Those are it good series of make easy. questions. I'll

conversations. submitted. not any those had yet have of not have we That We for,

trial a a obviously, takes And than got the ago, process little get bit a we finished there's month to the less just and and adjudicated all Again, there. and that plus it time organized data. Okay. of

we ready the obviously you be So step don't were which earlier the fact that it would could way, skipping along a do. obviously now mean

William Plovanic

that of this forward Is and point seen base then should a operating as $XX haven't of a expansion? expect normal the is of use off going leverage R&D, new of X years. we margin most terms point the nominally. we really on almost million this R&D And a the just this low in spend And kind in in terms of

Adam Elsesser

used pretty aggressively innovation. we're term think clear -- I we're to I it Yes. going was think I mean, that in invest the I

testing on this and spend R&D depending or types quarter-by-quarter that. we So what certain changes on the certain docket, have of whether

that's not in sort on so organized work based move spend And artificial to going sort the by of you're of of of or some see around that budget. kind us, front

wouldn't per quarter the I anything read So into se.

to it. has spend read been general pretty Our accurate way a

X I agree, last think And products be everyone year. launching would

of back innovation We team spend. have going But and amount from department ahead. a not that that. a decent to efficient There of a effectively are to and is lot away pretty we at continue R&D a can innovate incredibly

think I continued we're of We ahead while. specifics, going get innovation not innovating won't years into but for the we to quite have a of stop us.

Jason Mills

Bill, remarks those date far mentioned as R&D. And percentage the that only solid a savings to so would that, I of the to with expenses Maggie in add very in Immersive thing Healthcare her exit -- are and the

R&D break continue say, we investments in out side. in investments prepared Adam it suffice were the the to in Healthcare. as invest we we said the interventional So Immersive interventional once his aggressively the to But remarks, on vis-a-vis side on don't making innovation, and obviously,

Operator

line from of question Our comes Truist Richard Newitter Securities. next the from

Richard Newitter

performance product on X add launches thinking 'XX year. of 'XX. in any solid there's you on flows those just remind Can mentioned the can the and in dictate that you you I launches and and ebbs Congrats said you think, performance. Adam, could hit to today? many those the the an unmet direction and where finish new where several be need about when quarterly the had and value How you us are don't have fill Maybe bag

Adam Elsesser

them. specify we year mean year, didn't we -- I'm launches going we're saying didn't don't even to just X the Yes. announce like last going X we I not and no to start have

positive the most other but very think They people as don't X our business focused have the have on. were think the that CAVT-related, on a everyone X, -- I had the I knows, impact overall well.

day possible things get But then going of list. a about about them. we until through we'll that's on products we're wait to going So talk of already talked that that. The times those to go [indiscernible] that obviously we're to . and the be happy We've one only not rest, couple cleared, is course.

Richard Newitter

be range. needed it's other . to hit clear words, is guidance [indiscernible] though, not Okay. to your not And just In Thunderbolt

Adam Elsesser

Thunderbolt not not it's because not confident we reason, is guide product, currently control that think because don't not in don't to we're that, But for the a Revenue simple for because Yes. about be we the our on great going where because careful. And we we're it. of incredibly process. totally stand

on guide we change based So have we to something don't our control. don't

Richard Newitter

are you on thinking press one Do you -- is Just just that? midyear? conference a this last we at can get expect or Okay. have And about how to something released Thunderbolt. this presented one that we

Adam Elsesser

on approval July November. the major Yes. in one timing. conferences, U.S. It U.S. There depends is U.S. and really the one in are X

And time, means to launch -- that it's obviously would the the not product, of to about presentation, it before not a clearance obviously, the so the time happened to one possibility there's the around that present right the hearing no which data. we extent data when formal wait

Operator

Your next Sandler. Piper line from Matthew question from comes the O'Brien of

Samantha Kurtz

in on on Samantha potentially potentially a is of on How clinical of impacting growth There's This about longer term enrollment these near peripheral trials going in and you trials side. kind are devices both helping the thrombectomy neuro the for the for or in sales handful the term? the aspiration-based market thinking Matt. grow

Adam Elsesser

Yes. of there's them. they're a -- not handful

an way. the our it described you really right not It's think I impact obviously. sales, on

quarter. pretty that was this obvious think I

our that. changes actually And that to you I like real of a our think we'll focus story. products, think momentum we that anything using changes when the those speak physicians lot strategy, will sort think it I gives or don't the of -- you

Operator

question line Michael next from comes of Your the Jefferies. Sarcone from

Michael Sarcone

Just from Could just into to headwind Is talk what here? China China you pretty about for kind assumptions How are stabilized was kind points. XXXX, of big XXX maybe in basis it that? of baked guide? you thinking you've about start, a XXXX got

Adam Elsesser

while. market for element isn't deal outlined in sort to U.S.-based about for or that everyone what number mattered question device U.S.-based companies available think it, that of China had we the been at no market medical And There's us. this again, sort is product. we manufactured will have that little of as of more if elements a it And have phase you really beginning Yes. talking the that of we we've different about the of lot, at markets. but and are or said talked what the would that means about think year, headwind a behind have, a a bit and but markets I there There's think than matter the those I the international we've that, and for opportunity

remind XXX,XXX do outlined, taking you're terms to internationally for I the and can growth and I what's of is that the good work selling market to What grow the to everyone, a market we It's Again, to see a think of -- If they XX% market number years. scale and add strong pretty from U.S. doing we XX-plus that and we're really, the why think in we've in continued patients. that growth of patients than more to really scale years, alone, U.S. outsized continue which that together, necessary for us. a international position we markets access treating also through of what the When make been continued of going treat. the matters the we've not. we the changes And available a with in the they're from -- you year. work everyone have share viable and hospitals, year sure just knowledge the can work so in

forward. their ebb flow all that And international economies and of sort then we own as the markets, on and go based

Jason Mills

alone the were add Adam we're XXXX, Yes. as last be half in headwinds, the your answer. of the of to Michael, nothing. The you sort posed headwind actually that right. won't especially headwinds to is in in And mentioned, And but that, you're de just China XXXX headwinds in year, will see to just XXXX, some a quite than going headwinds what from greater of to slightly first as the be of year. minimis XXXX much next in It

international growth. out China, as in growth, So and our an parsing U.S. guidance you acceleration you're if growth looking versus businesses. you're across actually exclude at there's as -- the you're

again, China, land the from headwind in half the of year. will And first the

of in the China. half in you'll terms So first as hit see year-over-year to of the the of growth because that XX% year it relates the guidance, XX% to

Michael Sarcone

maybe & just M&A in We've Got earlier Jason, helpful. year. Adam space for seen the the it. some this follow-up. That's activity Thanks

be on whether there's or to potential capitalize wanted or to that any coming pipe sense for your get Just if disruption the down competitive not able bracing in you change any you're on? may dynamics

Adam Elsesser

things stage. that this but -- on certainly doesn't at in ownership of new going any our the competitively strategy the we momentum change and tactics we welcome believe it into on now. overall, that get generally field I'm to like or have into not sort particular field, really our I right can you tell

Operator

of question from line Your BTIG. comes Ryan Zimmerman the from next

Ryan Zimmerman

for want I ask to bit. about a margins gross

pretty significant margins step-up ahead hit -- doing Just it to is 'XX 'XX that exiting or in to because just Help go Maggie. gross XX% the math, in me imply does a understand, I that mean,

Maggie Yuen

question. majority in came have of this drivers mix bectomy and expansion drivers regional our year. basically, Yes. I for No, product you from the there's ], mix. [ from no fundamental mix also that the underlying mean, margin seen thanks Well, changes product

If you mean, look have back our good sequential quarterly I pretty growth. at seen you 'XX, momentum in

XX% our you in us continue trends if momentum, And at reaching can similar expect I think of continue in XXXX. see XXXX. We can you target that exactly sometime

Ryan Zimmerman

Okay. to margin that a a function get anything is But to clear, Maggie, extra that be that of of you just just strategies effort in is mix not function you're kind of that any contemplating else or product pricing 'XX? in

Maggie Yuen

focused leveraging our It is spend mix. mean, overhead of very nothing. operation been scaling No, course, our And has capacity. and I on product primarily team

So all those altogether [indiscernible] drivers

Adam Elsesser

mix not and price. is manufacturing efficiency It driving is It between it. that is product definitely

Ryan Zimmerman

heads as I And Very scale to the your Okay. up question, you the thrombectomy the amount you've force to business. guess, clear. say then hired additional and sales in Adam, is direct of second grow

attacking question to that coming in into you're understand underappreciated initiatives, and at early what its contributions own market you market from your both felt on of but process? where when to that that so in do How you 'XX. those either market just And similarly, of the of want I how impact efforts? and with And or you're is is expect of arguably the be same access, now access kind dynamics the think kind about its which

Adam Elsesser

the us VTE, felt competed certainly in you Well, think if with obvious. that that's quarter, I fourth pretty you and

started we've in it's is. field think And nothing I not process. always this said I've that linear.

So we want really I it very done this. to hiring said, Right an really, have linear. I not is that team. be being clear a incredible now, job That great mean

best We glad appreciate and Medtech. commercial their lot is assembled of the I team they really and have people true. do. I And know in But it that teams, it, I'm say a ever about

extraordinary. is team Our

opening data and the add have help that to talking directly, eyes hospitals we now doing their more to could they And and more when to you we're patients. about that what and be

CAVT I doing is A have better. that not of been, It You're Again, a worth we It that really we good started but lot in process. a think linear clearly have spot. never that with is process. is has it's that because now for. technology

faster cloud and get out over over and We've shown You the again. that safer.

that's thing. data of have just quantity that clear. same data, We think the I now says large And crystal

because to that market, And effort penetrated get all with I a be all continue. this going going these patients. multi them will multiyear and help keep XX% will we're until and So think again, only it we we're

came do have hit can of she "I was to said, discuss she her will And team you one if request the And vascular -- don't this her a in that this at She story, commercial somebody end ask gets that benefit everyone her technology. we to up stop asked she the the of technology a room. coded, mistaken that. short Massa telling say I'm And happened. this is assembled had was with a that story, entire thing. technology until one didn't We turned weeks her story, her said to received the from a great the didn't our she as who or set from available. of me have heart bottom share several ago. best team, and it We everyone what will not ]. patient from had recovery. If meeting I out [ indulge big she with and entire to And sales national revived

to that's in room, we're going the going many that's motivate us. It to and for certainly And do did what years. many,

Operator

Markets. Singh Your Capital from RBC line the next Shagun of question from comes

Shagun Singh Chadha

business, that incremental quick anything acceptance past we've growth And I'm Just rate that else able talked what to get should How going commercial given just year-over-year Just in a to us. that one you've that? given durability it are quarters. ability seeing you of you may door? me into about sequentially benefits the team wondering seen XX% the is about share thrombectomy expansion, few anything think for on? Is be U.S. greater the your just you to shared your if there growth. with we for accelerate the greater

Adam Elsesser

in growth to rates Yes. where Again, is situation and market I growth no there's a want share shift stress linear.

it's on seen just both being the that not on you so way product more takes is people other people, good. we to impact to can said, want be happening. [indiscernible] can't are and the hear That go the -- move that technology, any have than not. be it the And it analog digital process. through to out about people be clot they market. and have And is a -- that They have direct we So It trained. try technology as blood faster product to from obviously, it, therefore, therefore, much as

that But a while. continue, I will quite think, for

particularly continued in I more and not strong continue. people. think next what You as and more can to going course to growth more that, treat quarter-by-quarter, of do become you're you're number of overlay they strong more to hospitals that the aware the fashion a opportunity years, linear going And information but the to and of growth over see see do

Operator

question line Kratky from from Partners. the And comes your Leerink of final Mike

Michael Kratky

growth, obviously, growth. acceleration U.S. thrombectomy XX% in U.S. VTE So great

different to verticals that another Sorry U.S. to between can on But growth? and frame without where guidance. you providing your stroke bother to VTE, with land XX% help XX% to expecting overall relative one coronary specifics, arterial, you're you

Adam Elsesser

Yes.

you to have of that this think that it's premature those -- be give stage. all kind at to drivers. I of detail Obviously,

attract have market to Flash We customers that's together continuing the X.X lot with more access a work.

significant can't as but if well. a isn't obviously, catheter, have even arterial, not talking which which which Thunderbolt, it, going guide, with to first of our as that's XX so the X well. about cases show ultimately with the impact. new have it's products include continues to Red an going be benefit whatever of do days new to then, it has in course, the happens we And is technically We

So I a drivers. think lot we of have

updates the that, we give you when see, information. we'll have and and wait more within So more exact let's numbers

Michael Kratky

for Flash Understood. launches? Can on one early Europe as recent just comment maybe trends the adoption following some and you follow-up. Lighting And in the of X Bolt

Adam Elsesser

yet aren't There where Yes. they're some limitation again, place reimbursable. -- a there's countries the at is fully that

the so every meet Again, goal. yet is, same country safer. it's but out not is it the seeing faster positive a to where who and big the And taken benefit in that cost a I've way, we're U.S. seeing in And physician not in obviously, a we're that's single says

Operator

concludes today's Thank to back the Q&A you. you. of And call turn over Ms. portion this the conference call. Furlong, I

Cecilia Furlong

to management We team, thank Thank of on you call. you you, interest and operator. for our again look in updating Penumbra. On today our forward behalf quarter all joining your for us first

Operator

This concludes conference call. today's

You disconnect. may now

Penumbra (PEN) 18 Feb 252024 Q4 Earnings call transcript