VERO - Earnings call transcript Q4 2021

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Operator

Good day, ladies and gentlemen, and welcome to the Fourth Quarter 2021 Earnings Conference Call for Venus Concept. [Operator Instructions] Please note that this conference call is being recorded and that the recording will be available on the company's website for replay.

Before we begin, I would like to remind everyone that our remarks and responses to your questions today may contain forward-look statements that are based on the current expectations of management and involve inherent risks and uncertainties that could cause actual results to differ materially from those indicated, including those identified in the Risk Factors section of our most recent 10-Q our annual report on Form 10-K to be filed with the Securities and Exchange Commission. Such factors may be updated from time to time in our filings with the SEC, which are available on our website. We undertake no obligation to publicly update or revise our forward-looking statements as a result of new information, future events or otherwise. include in certain accounting accordance GAAP. also are measures principles will calculated not with call references financial to that or This generally accepted generally financial We these measures. to refer non-GAAP most non-GAAP of measures in those our with available issued website. press are our GAAP calculated Investor today of Reconciliations on accordance to the the and comparable financial presented earnings release on measures Relations portion Mr. like to turn to now over would I call the Serafino, Executive of Concept. Venus Chief Dom Officer Please go sir. ahead,

Dom Serafino

Fourth Financial Quarter welcome, I'm our and everyone, Della Ross Concept's Sales, Conference joined to operator, Portaro. Penna Global XXXX you, Call. of Venus pleased today Thank Earnings by Officer, and be to of our President Chief Domenic

customers sales for of was our U.S. in and priorities by let's sales The team global the of will year-over-year overview increase a GAAP distribution the questions. driven in growth review will in results provide for with year a customers get Domenic release. of quarter. we'll reported year-over-year. an recent our international brief we guidance which in Let will the update of me key quarterly then started today our Then in Ross revenue will balance commercial Then in a in I quarter start and press total And growth We $XX.X mind, you of overview our update. will and for period. our million, introduced of we be our XX% review what with of results, of trends. XXXX, that and provide months. sheet fourth performance With our with XX% the up areas to business in-depth start then sales an remarks. XX% today's our and fourth open revenue call full during revenue with progress operating more revenue provide a in the financial agenda I summary covering our prepared overall

are the XX% demand increased overall systems our period. the during we trends during our revenue encouraged We in the year-over-year, XX% increased procedure-related of revenue very impact year-over-year and Total experienced service quarter. VeroGrafters subscription fourth of suspension that QX, by excluding our and disposable

driven Legacy, subscription part Epileve record of prioritized we strong and subscription of we revenue in franchise for and from the our strategy systems products We adoption Venus growth recent discussed hair products. in franchise. investor was our benefited our of by Bliss commercial products, key Importantly, growth and quarter body as experienced strong adoption the other calls. our sales restoration Fourth and quarter Versa, also Velocity our Venus aesthetic a including in systems

fourth the slightly across in the last Omicron our the October, Outside call U.S., in continued U.S. recovery in usage the that before November impacted practices we September nice we respect did in With consistent variant real-time per The trends IoT in moderating to aesthetic in a trends December consumer for in companies reflects working discussed $X.X and on large team U.S. specifically active a in procedure great of QX. activity portion as during data usage quarter-over-quarter and backlog of million the the hair trends to Procedure have data region respective average the to fulfilled system our most improvement trends as remaining quarter pandemic. world medical the us gives strong date, of date from customers fourth our the approximately base. device recovery This the visibility installed in with nearly through quarter, of fourth for restoration depending expected. all Our reported a the quarter, have of the of job what backlog reflected usage continued varying see our trends we to pace into the

in were seasonality QX of our increased but our on in procedure procedure Procedures ultimately from high primarily had in expected for fruition. mid-single systems than trends procedures to QX to ARTAS larger America the in year-over-year saw impact which in expect Outside trends discussed came and improve As QX, digits we call, North systems driven and down the we increased year-over-year North teens increased sequentially, mid-teens quarter, by ARTAS our sequentially. improving EMEA. America, a

received Now new fourth considerable clearance the areas for turning our recent October, health in Venus Freedom product on commercialization. women's we've operating in common the development of the can which range broad and Overall, expands made treat a conditions. to clearances a of that technologies portfolio in highlights brief update progress quarter and months. We our of XXX(k)

in of the will launch U.S. of that and of Note the limited preparing profile Our XXXX. on Venus the are a we began Union growth beginning and during Canada limited continue Freedom be launch in half European XXXX. first believe for the and the multiyear Venus X/X, Freedom our contributors that Fiore to to Fiore we in solid

for to is effective and differentiated technology. addresses data. clinical nearly important strategy in significant X this supported We that to a create with system needs measured devoted safe this a comprehensive, Concept have medical and execute thoughtful to years technology continued develop Venus order and

system community now on relationships business model, believe attractive both educating on OB/GYN we will our return on in practices potential focused and to requisite the customers are KOLs this the of investing for Venus We develop very the which unique investment with time and make OB/GYN utilization-focused Concept.

in the to received Max device includes capabilities, expand in also device as addresses technology. Bliss our muscle our of in-demand continues for and to and This stimulation Venus new Bliss contouring all make Max only but workstation. January the most Venus well. launch are for products efforts Our in X Bliss of body contour one the We progress portfolio clearance body preparing procedures not XXX(k) that Venus commercial fat and QX. systems a reduction is

but [indiscernible] to adding device. utilization new device list contributing treatment intend have modest, important above We of of We price $XXX,XXX a and approximately margins gross this a averages. this approximately expect will profit fee company on per

time weeks, of just compelling XX return clinician that extremely of investment we we the of Importantly, will expect which customers. be to our estimate

months in advance technology regulatory AIme, for material recent Finally, clinical we've we platform robotic development, are applications. for to proud nonsurgical medical strategy our aesthetics of made our progress and

clinical control we in and to clearance, indicated secure community and review today. fourth been ahead on important tissue med that, AIme Where a nonsurgical quarter earnings unique general to and a review press via introducing indication AIme to historical timing we from our robotic platform, the for very it to we the expectations for platform, specific result aesthetic The resurfacing is process of XXXX. an strategy limited and clearances. tissue release device secure progress for formally execution submission are has an us indications this designed differentiated of later that our cost time products extremely collaboration general the We time by targeting March we technology resurfacing, platform clinical technology of investment regulatory year. remember engagement for we parallel and skin for team's significantly indication compelling issue to and approval are toward internal of gives with AIme, excision additional preparing we for FDA a It currently this different FDA. treatments are of a is we applications In the FDA any excision tech, the our important to beginning upgrade XXXX. for this is our the also is are available to for just support a prospects strong of an press numerous release disruptive made with AIme to intend release, discussed market and believe this submission notify to potential path not the As and the in it XX, direct a lines making the look the in which are to face. process, clearance Street in based lines of submit have This forward our clinician, of effective

pursuing XXX(k) opportunity long-term growth specific enhance for This on treatment and our for which support wrinkles expand study using will prior study clinical moderate safety further clinical efficacy the will of to submission for the treatment and the cheek, discussed profile. our severe an our evaluating As market we addressable on are FDA wrinkles. facial of IDE a AIme indication the calls, of annual

the enrollment. protocol begun X that clinical We to have train sites finalized investigator we've announce to and happy are

milestone. sheet, call XXXX review our of me have to quarter to the we provide and our in guidance. a over financial first and expect discuss patient and the notify Domenic press to clinical that, detailed financial you the release will We sorry, who the condition turn Penna, results Della fourth our Domenic? balance let via With coming weeks achieve -- important treatments to this community identify when we investment intend

Domenic Della Penna

you, Thank Dom.

Given across with of the our review performance the rest revenue Dom's a detailed of I review results, P&L. begin our of financial will

margin year For by prepared in prior and growth-related the $X.X will the The Gross change quarter or or marketing or $X.X of $X.X GAAP by adjusted to profit on $XX.X unless focus XX% a items million. company's operating driven reported basis million loss Venus $X.X million avoidance or were XXXX decreased revenue in sales total increased fourth in XX% was Gross $X.X $X.X increased $XX.X XX% million of results expenses. on for loss to XX% partially an XX% and The remarks flat XX% primarily or and to are a of $XX.X the $X.X million sales million, year-over-year decrease administrative was X% fourth and $X.X by Venus the sales to by expenses the increase compared to loss and to sold higher of our Net operating XX.X% to in Non-GAAP driven period. system million Bliss. quarter of under offset of decreased attributable XX% consumables gross program, mix improved stockholders $X.X was or of million. million expenses or of primarily in an EBITDA versus revenue Total increase tracing and margin general essentially subscription million. in expenses, operating all basis. million my noted, R&D increase expenses million. doubt, Total a otherwise of on XXXX.

a have our reconciliation of to our We adjusted provided EBITDA in income net full release. GAAP press

the Turning to sheet. balance

of As and December of debt million, million respectively, obligations total cash equivalents had $XX.X $XX.X and XXXX, and as December million approximately of of compared $XX.X XX, to cash company XXXX. XX, million $XX.X the

the during by Our operating in in private a X.X by placement $XX.X of partially fourth our million. the million of cash activities shares nonbrokered the cash our securities proceeds into convertible million investing XX, we of from purchase preferred financing in driven On agreement of pursuant we period, was XXXX December of quarter million and entered issued for The change to XXXX, cash investors X.X from $XX net transaction common offset used certain activities and million sold an stock. and sold net $XX.X which shares was in aggregate securities stock QX. this

$XXX,XXX, quarter cash Our used was of for cash improved operations have discussed fourth significantly of in throughout continuation the reflecting a performance XXXX. the we XXXX

was ended period. by driven Specifically, year-over-year, XX% working months decline for compared XXXX, the XX% a reduction and cash net used December capital our to $XX.X loss XX the used a million, down cash in our in year in XX, operations in prior

of review our a to Turning guidance.

$XXX.X we XX, $XXX increase in total detailed ending representing approximately range million, December year-over-year months XXXX, release, XX press full of for total XXXX. December ended revenue of $XXX for company introduced to XX% our of XX, the to As compared The period. XX to the revenue revenue XX% an for the year guidance the expects XXXX in million million our months

flow guidance including are improvement, profitability our we formal the outlook providing a another target we in for not fourth While cash quarter of positivity year XXXX, of year the of deliver XXXX. full achieving material profitability assumes

offer For we like underlying to understand targets. the would investors XXXX modeling profitability driving assumptions our considerations help purposes, to the following

to in the XX% headwinds First, our gross as improvement XXXX. see continued to XX% in we be pressure margins but expect margins cost driven we also of in gross expect to mix, range goods inflationary by our of

drive notable operating in Second, to we expense continued XXXX. management leverage expect

representing XX% million, operating to of year-over-year the growth range we range GAAP compared of to revenue year. of to total Specifically, growth expect XX% million this expenses our $XX $XXX to XX% in XX%

in $X.X average expect expectations reporting share not of quarterly of is it we Third, helpful to noncash revenue. $X XX continue our outstanding be Fourth, to million. interest expense of the given compensation are expect the approximately we it our million. our -- quarter to we provide range first of million, to while approximately quarter and weighted guidance, total for D&A we approximately noncash practice shares of fiscal to we of the week finally, and last XXXX, would stock our that million fiscal be be And thought expect $X.X

revenue year And first up $XX.X 'XX our to XX% quarter in XX% I'll such, to that turn will now, million the includes back to call assumption the full the million, total of be guidance range revenue $XX.X As year-over-year. Dom.

Dom Serafino

Domenic. Thanks,

open up update and an the distribution have share our Ross? call we commercial to for questions, priorities Ross Before team. and on I'd global sales like our

Ross Portaro

Yes. Thanks, Dom.

skin face The hair efficacy one more clinical methods. our Combine and the one supported body number that hair and in franchise, company has Bliss been Max. the growth system. growth priorities, projections aesthetic like as number is growth unmatched the consists consists ARTAS Concept in our targeted aesthetic tightening and is to you our for which of X clearance, and our have they portfolio Before Versa, and restoration I'd franchises Velocity, QX with ARTAS our The on leaders one attracting franchises: versus by muscle of Epileve, that competitive XXXX natural I as current NeoGraft; is will commercial pleasing proven an our X With Bliss be in our Bliss key Legacy, robot fat, to which issue growth Concept. advantages, X address and a portfolio our market product product franchise, men with modality only Max Venus solutions loss. of With Venus superior current providing past aesthetic our portfolio strategy support execution long-term well aesthetics will restoration hair growth aesthetic is touch beyond. and and recent and these

and VERO of President recruited We most important East; America, for of Venus strategy aesthetic most a added North vice of Canada commercial National execution are Concept X a with President U.S. Sales, U.S. North industry Hair. at Accounts; of the also pleased Sales, or West; presidents Vice QX Vice a We We our expertise while priorities. Global The leaders. Sales, aesthetic starts promoted top. top and a American VP promoting VP also of

in regional Hair. We the robotic also we reporting one To execution did ARTAS in in X commercial QX. at in NeoGraft, our and record specialists our strategy franchise directly level. the Global hair same in the maximize resulted to U.S. EMEA VP with VERO our restoration This advantage and sales restoration added of hair

with later We in Venus do the expect strategy to same Freedom XXXX.

standardizing manager at was and experience priority level as strategy training. commercial aesthetic Another adding sales more territory manager the area as well sales

continue training. aesthetic XXXX comprehensive We managers, X attract managers, robotic territory XX sales directors, X while of to establish sales was leaders VPs, QX regional count consisting head sales of America proven managers. XX to targeted providing also sales area The goal specialists, inside sales for XX, North X in X the

EMEA, have the the in have We XX with XX% areas the of at direct sales filled remaining Outside teams highest in countries. these growth XX% over commercial level. U.S., LatAm field APAC or positions we and the

head sales XX. is OUS Our count

back With that, XX over in remarks. distributors closing I'll to countries. turn Dom? for have also Dom We the call

Dom Serafino

growth share wanted assumptions for key Thanks, some supporting the closing, our of XXXX. expectations Ross. I In to

outlook these NeoGraft franchises XXXX from X growth year approximately these includes we Our which the Max franchises: revenue revenue year-over-year XX% in of of XXXX and total franchise, our represented our procedure-related second, for first, hair XX% systems Bliss full and than franchises key which includes year-over-year products; more our our Venus Together, assumes body key comes ARTAS revenue and procedure-related to and franchise, our from expect products. XX% than total growth and our X restoration XXXX. increase systems revenue growth specifically, our Bliss and Venus more revenue,

sales total growth contributions revenue franchises growth from to to the and revenue Importantly, X continued margins. these to procedure-related recurring gross in of accretive fuel be company growth we our and expect total

outside lines, time. outlook of the our growth of revenue franchise products durable, total highly revenue includes XXXX This aesthetic full X Versa. of those aesthetic business over Legacy dedicated portion including aesthetics Our our of Venus earlier. to portion and also approximately the XXXX commercialized our XX% the our and of stable of from contributions represented have assumes product contributions as products, demonstrated largest these X Venus body from Sales total discussed medical business

mid- digits years. sales of single We to in has to expect these the high reflecting full the growth [indiscernible] year-over-year in durable evaluating when There products to are stable a XXXX recent mind the profile expectations. these in of continuation demonstrated increase XXXX, X items additional in bear growth year

in growth and commercialization will franchise Max the U.S. our the introduction fueled second the First, driver of We to be year given expected ramp-up Bliss the earlier, a by growth U.S. and Venus franchise over stronger total the the the as be year, our do of the the commercialization in body Bliss Bliss timing Max QX. of our company mentioned half of body expect Venus our this in outside of material continuing to of

assume the Second, not our the contributions of of from following investment the commercial receipt QX potential update intend contributions in XXX(k) does material release clearance. XXXX related to XXXX. revenue AIme the guidance to initial this We on of of community AIme the release limited

AIme AIme that not growth now And beginning beyond. differentiated open prepared will growth, this to assume to XXXX our Operator? focused to receipt as total materially are we to questions. possible in is ensuring be we'll clearance, would to call your impact the of for the following as contributor highly that, and year regulatory fiscal robotic be soon to a that strategy with is and commercial expect material expected While operator, execute XXXX well technology fair we highly on it company

Operator

And our come Thibault from will question first Marie Instructions] [Operator BTIG. with

Marie Thibault

here to how about a tell now Would that little the first question Wanted product is about recent in love the Can bit more are to it's how that product? the on received us clinicians this market. viewing that you hear Bliss ask being Congrats progress. Max.

Dom Serafino

you Ross, want Sure. that take to Marie? from question

Ross Portaro

recently excited obviously, the Max key demos. X actually to skin muscle for you Bliss did we've for limited launch the release that actually Marie, fat Sure. infrastructure sales and the have our purchases the in QX, very some I fantastic. been Max and the quadrupled the tightening, and system platforms we also quarter-end we're expect can in Bliss that only the booth close. We've from full of stimulation with AAD the had has build a that attended KOL tell With growth product. We just presentations coming a QX, with and for availability muscle. foundation and

outstanding So because platform muscle it's it's proven with interest. technology fat tightening and our with been received mostly MP^X skin stimulation phenomenal has a and and Bliss the by adding created with EMS

Marie Thibault

signing We It deadline that's X-part Okay, only launch so of that comes here. XX days here. for forward the like of through? great. the it's you in AIme? X question deal here. then The What a happen kind sounds question for approval just needs AIme. a needs with limited look to between away, why letter secondly, go -- What March until that broader QX to happen to on And And really are of launch? really of release limited of for then ahead waiting a sort until a to we

Dom Serafino

great. Yes,

able in March the We feel and so going they to confident the lines meeting FDA. be of So We we're pathway. first the year of XX. that typical we're Marie, that by your question, our with get be fairly FDA this first the and we're a the us all, with to to part had to in we earlier to file going time clearance is them, for indicated worked confident able

usually a is process. XX-day Now FDA

at to quite any the we So sure our it are launching in we of the that to there of product. could sort little for that a questions bit account or FDA assumptions level, cushion, if in built when frankly, delays comes make

gave impact We also have little so a the already does line, want a when to in should ourselves doing bit viable product we of We a able that's room. ourselves get place at and a in issues but of early available why chain we QX, confident cushion bit for we as that a pretty process build AIme. bit give the able to few be there you're a well. feel commercially of to little time Supply be the time

Operator

Ladenburg Jeffrey question next from line of comes the with Cohen Thalmann. Your

Jeffrey Cohen

the ago. Nice at company couple see to of a days AAD

So a from our of end. couple questions

most we're all QX? give you us for, that some about to So trends systems buying there as QX platform And at would read versus from could going how the as of into? forward? was trends to any on into should thoughts through the pulled get far I there we modeling Any expect say, leasing spillover

Dom Serafino

Yes.

trends. actual that that I'll a our units a there touch just dollars. versus programs, the a percentage Domenic our between to sale be subscription/lease we the clear think But difference when is of on let look bit at of business I traditional and as

an the For example, that at the hair, available under or restoration looking But subscription also $XXX,XXX area when we're in is so. model. our it system not ASP the ARTAS for has like of

So impact dollars thing subscription. generated versus of Bliss. the it does with Same materially Venus percentage

going In of where on we're to there. DDP, touch you trends, the want terms

Domenic Della Penna

In of sales, we -- system in are sales. fourth shipped. uptick terms the driven fact that had of of quarter the Yes. record significant had units a for business was A the cash side we the by ARTAS in a in that lot which quarter,

on cash strictly a is sold basis. ARTAS So

cash So not towards and a bad more that of it skewed thing. the that's in kind fourth quarter,

kind we clearly, QX vary a QX in We will sales depending to back of XXXX. a expect both bit kind with will side. Bliss and that expect rebalance things rebalance have are good of will QX. that slightly of system on Max ARTAS continue the certain growing. on that But we subscription component in They a But subscription on as saw business relative focus Bliss quarter-to-quarter how a up subscription quarter will that on in going in forward, be the we Max to picks mix sales and our of little kind

Jeffrey Cohen

arm the such on et energies? with and to AIme And device the as with actual Okay. of at clearance you resurfacing the have us then architecture. a can the as this ambition thinking the one walk cetera, its tack year you're tip others as Is rollout such on wrinkles, and far how then about through other

Dom Serafino

Yes.

whereby through our system using be to can it on has that significant industry a the for intelligence, integrate intelligence energy-based and in clinical precise the we'll improve with profile manual assessment been platforms. in level And of arm. the outcome is And an strongly imaging machine been artificial feel use, of the intervention the I And tissue, of things will me. all that the we cameras, designed device, of you've take solutions terms a the head the predictability, believe, AIme is. think has most into hit the number where example, platform robotic to will remind for the these audience of different an very what we of technologies acronym think artificial AIme that this robotic nail role help, where more cetera, which able safety a a typically efficiency we norm. et that of we of do different this of play will variety And is address learning,

And so first terms as and a any year. the indications our clinical more will will not like in do what that expect to with to they benefits phase, launch or be this be a exactly learn attracting as we platform to us We initial number the will what this KOLs know But expand available clear, clinical number start-up of can do platform top R&D the only don't an teams. units of the of have -- be. just to start-up help articulate the us also but the be able about help dedicated

obviously, good by end of models to and potential that XXXX, as the experience. So off build, our year, the for have going pretty of financial a to we're the we'll assessment

Jeffrey Cohen

it. just And modeling I purposes. Got if may, for Domenic, last one one, on the

million called to OpEx. a You that $XXX out number? million GAAP Was on $XX

Domenic Della Penna

Yes.

Operator

of from with Block comes Stifel. question the next The line Jon

Jon Block

the one, Maybe Dom. first

are IoT on get unique, Just guys there. in the you you data. a look real-time Again,

aesthetics. always but are talked January the about people on curious trends You and persisted exiting Omicron then into 'XX,

how get do. reopens, As the world reallocated if they dollars

So but the played apologies, a unless call trends us Feb, from you patient color I missed my can March? any that how it, Jan, perspective, on give IoT it, out

Dom Serafino

we that now trends to seeing where We're of Yes. ahead were. are XXXX, similar

good basis globally there's news here we consolidated on we've the is in Omicron mean, to always there. I pockets, trends. as impact and the So of the Jon, -- especially seen patient look for a and But really that globally no us U.S., overall,

we going patient see good think about feel to pretty I utilization So that and how that we're improve to continue improve.

As I the trends numbers the of earlier, the are XXXX we market. mentioned saw now to ahead when consistently IoT we right brought first that

Jon Block

great we've know Max earlier. AIme you And well pivot, I got talked then Bliss to that's Okay, robust and maybe pipeline color. the Freedom a about and as you've but on call, mentioned

capital bit there? you business bit model? do last the that I you out provide cost a on think sensitive because XH How different 'XX little any a be other being more a was you've of it I a about earnings then anything business think Dom, OB/GYNs you talked the more model revenue can can and share launch. of about U.S. you target little the called got year think color, we a a market contribution that this But perspective. to call from from Freedom? And

Dom Serafino

Yes.

market, is, what's think especially that OB/GYN product, X-step a KOLs, important establishing every I is have clinical a order really step the it In mean in KOLs. doing network is we're have strong what in matter to it data. of establish process, a to to is, network Bliss one able of strong Max, I solid you with doesn't as be this Jon.

benefits, this -- versus things there's reason and develop product and X of why that the years over of we women. for took of have claims making strong issues variety to we're a a bring One competitors, able to to about this wanted some that X proudest of how health the particular the support we that years our product to data be we're to clinical the most market is different that

call so it positioned, with OB/GYN in KOLs to looking to right? who to we So the are product sure comfortable they steak, routinely that with community to the have the not, comfortable is for feel be able properly we're available I'll make the looking And they want it. what demonstrate they're the sizzle, for so

not of The this and to of capital don't is -- second aren't money want lot they this quite it. OB/GYNs more on if do used They're important, to equipment. equally, part spending typically a

modest procedure what built a for have rolling. a so because obviously fee model we meaningful is that And be somewhere each will contribute ball did just way. have to licensing can was that KOLs will going the big to then clear, into a of We is the in the we a XXXX, for a in will get want area we place. fee a This business number business, we didn't $XX,XXX that the unit. sure to get to get what we utilization make plan do in appropriate And

Canada. in U.S. We place KOLs have those in the now We're working on

dramatically it's benefits and field through in we'll we'll established in therefore, feel not some by KOLs, see and adoption. the year accretive once terms we'll momentum to to a of that start move be XXXX unless beyond. and that team but able it's we see of QX to hope contributions, clinical But we've good in so pace the needle going the in build of the surprised And to we're the start

Jon Block

but maybe question, Maybe there? the build And an last broad just looks I then, like And a you, Okay, a this backlog. might caught sort on woods good Dom, great. balance brush up it are the that's question, on the of know you me, said looked X-parter. out The for just sheet perspective. side, for you with the for supply you're expanded other the with AIme, a think you inventory you one DDP, facial of from wrinkles. skin general really future from docs with it do words, XXXX, tissue the call excision can label general In need launch and the the get it, for no commercial material the a receptivity label about from in talk impact about for on, you going resurfacing or when but versus label standpoint? enhance you can Jeffrey's

Dom Serafino

Yes.

let AIme the first the answer then I'll DDP So answer question. I'll and

Domenic Della Penna

that times the we've Obviously, to our in the contract think a perspective, worst lead our From Yes. providers' of supply chain, chain supply demand terms behind we manufacturers. is the adjusted us. longer

through that by end to gone QX. few targeting time. We Bliss able process. in build to constructed have were to were adjustment a able of that build more more we've were units Maxes we So We the

a the the point about view. good supply of year balance pretty feeling from of we're chain So

Dom Serafino

And Jon, for does answer your that DDP? question,

Jon Block

Certainly does. Yes.

Dom Serafino

Okay.

perspective, of I've So that a podium that asking robotics degree And from reaching proactively to early reason out AIme an doctors consistent. they to high is with talk there's anticipate We as that always fully a to are the going, you know, doctors going be there about out want confidence to on a market the right? that can me first that, will to There adopters, medicine. I want first platform. of be about say aesthetic had where be with the the to in number fairly and directly we're advancements and are

those of all to are heading that So us direction. signals the right strong things we're in

it concerned doctors market industry, specific traditionally plastic versus leaders. more it really about call in clearances, to specific and concerned are typically dermatologists, our about the general doctors being the As aesthetic now, surgeons, relates less well, clearances -- I'll clearances

device very us, of having out gate patients the the high use fairly us face, frankly, we quite fully be had believe as feel we opposed to So based that for quickly and telling been our the we doctors conversations investigators we've have with the AIme treating for with who the of will selected have then they're this a to on second where them. physicians clearance that X probability tell who

ability So like first to most -- podium to I times, to doctors any like of these on the market with said, be platforms. be kind have because who

good XXXX. make in the impact How of but here seen, be And will we'll that a be to to big to remains fairly we be opportunity so an impact out strongly. able have confident gate feel we get pretty we feel that

Operator

Instructions] is Anthony from next with question of the Maxim Vendetti [Operator Our line Group.

Unidentified Analyst

on Jeremy actually for is Anthony. This the line

X quick key the remarks, franchises. the of your you a At your told Just question. end prepared breakdown of us

could out maybe said little high more of of from what you the revenue for you XXXX the out franchisees. to a XX% if from some and on franchises? single-digit out, XX% products legacy your your I'm you growth. you to the was your coming going said I'm math from XXXX -- XXXX based it's -- had with that just assume you just to XX% X is that X to trying those revenue be figure going then expect from be just into breaks going how figure trying key explain legacy more You

Dom Serafino

Yes.

As franchise we Bliss franchises we look and described, the right, includes at Bliss the the body X key Max. the

the it, the for OUS And and does that and from disposable Bliss, the higher element in is of a Max seen primary the traction, as product earlier, -- gain already we've not markets. will clearance the price-sensitive be to U.S. ASP. any QX, cost FDA, trends have the starting a the said the go-to price I in which to Bliss with We in have

one the saw revenue we early contributed on believe, of XXXX. well I per the that's hair established the that the the NeoGraft business. The will -- That procedure we QX franchises. of XX% think because Today, XX% which trends Bliss these will it ARTAS, includes XXXX represent the of in X our in our QX total in of trends the in that utilization franchise, represent -- So with second. was Max, restoration and franchises interest and based

as So I market. target going with think being business we've the our hire overall, really the to how they very, our how organization, consistent how at about about it that we look market, is specific strategized you sales very

focus revenue, growth, and overall We're year-to-year company. of about So necessarily XX% that's talking not the right? performance

Domenic Della Penna

Correct.

these we're so So that million, XX% growing $XX of that XX% growth X franchises. coming if is $XX is million from -- of

Unidentified Analyst

Okay.

revenue growth. total So it's

helpful. makes was total lot revenue it I there. that just that's -- a thought in Okay,

one And then great. Okay, you. just for

-- giving margins, Maybe steps mitigate some to mentioned any outlook mentioned going some you that You when are headwinds were taking of you what about was your could of -- -- us to the type steps COGS. there XXXX help inflationary gross understand. that? there and try you're you -- pressure Is your

Domenic Della Penna

XX%. that commented to of We've XX% range the Yes.

of So nature selectively looking these our have out extra we're our a on to and the in by half managed such the is be component through depending parts get extract pricing grid the XXXX. big it, inflationary on pressures margin that we second year point because somewhat that increase could of surprised we

of do better COGS than Now to that We've XX%, seen those is depending we're initiatives hope we've the the head enough what to off on rumors plan the offset better. are possibly somewhere around balance such we're it taken bit that and XX%. headwinds we're But trickle of range the to XX% hearing through we anticipating. like, more a could pressures prepared but road, we out those COGS that headwinds coming and down

Operator

We're Thank no showing conference conclude for currently participation. you additional queue. today's today. for will the participants your in That

Dom Serafino

everybody. Thanks,

Domenic Della Penna

Thank you.

Ross Portaro

Thank you.

Venus Concept (VERO) 28 Mar 222021 Q4 Earnings call transcript