SIBN - Earnings call transcript Q4 2021

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Operator

00:56 Good afternoon and welcome to SI-BONE's Fourth Quarters’ Earnings Conference Call. At this time, all participants are in a listen-only mode. We'll be facilitating a question-and-answer session towards the end of today's call.

As a reminder, this call is being recorded for replay purposes. 01:16 I would now like to turn the call over to Matt Basco from the Gilmartin Group, for a few introductory comments.

Matt Basco

participating call. for you Thank in today's XX:XX

XXXX. within of of for from Joining Litigation statements. Accordingly, uncertainties these or current cause anticipated decisions Anshul by not remind made statements statements statements current that include and forward-looking and and duration today, results are have These involve the harbor forward-looking of impact Maheshwari, statements. undergo our future. statements Laura available training that meaning statements during Francis, future using that will patients are on laws, to pursuant December SI-BONE release of statements website. undue management the trends the and the various financial COVID-XX adoption examination Officer begin, reliance company's of results pandemic operating should and expectations on ability are and Other active Chief and our These and Executive place call materially implied the based Any inherently predictions I'd XX, statements. whether procedures call events and ended clinical these to forward-looking will Chief quarter will events, federal which actual Before forward-looking financial surgeon future the the for pandemic the make recur material me XX:XX copy and include the in securities such products, is new you or that desire on results relate of surgeons, risks These physicians and the estimates could press safe risks are or are the pandemic released the uncertainties. XX:XX hiring, risks company's differ the to to contained or A involve COVID-XX XXXX. expectations XX:XX and enrollment COVID-XX XX:XX Reform you Financial we on those forward-looking products, company's the based of upon Officer. provisions of in this as trial this Securities reimbursement the Earlier include our assumptions. expectations expectations to Private Act like performance

For forward-looking any call description and that, please and information, or law XX-K whether XX-Q our otherwise. Factors required the future by refer of sensitive update as today This of X:XX I'll call a XXXX. with broadcast to new the is the turn Exchange Form And information list Laura. associated accurate with recent or or intention section filed and projections over except obligation, with risks any the because of only our revise live uncertainties and events XX, statements, conference financial as or the SI-BONE the to contains disclaims most business, Commission. Securities February time of Risk to Form and

Laura Francis

Thanks, Matt. thank you joining XX:XX for us. Good and afternoon

quarter. various throughout were quarter of $XX.X was COVID third start surgeons. compared me XXXX. the the financial XXXX Let representing payor January provide For growth for I pre-announcement generate a our XX:XX by with initial covered comments regarding today's for we our Despite coverage opening will year, followed will who Anshul, performance and guidance. with XXXX and business million, additional of able results call, our update, the XXX-plus provide quarter of on revenue the XX% to U.S. record the to over year the with surges detail exclusive the in to infrastructure XXXX our team's XXX XXX pleased ended and XXXX. XX consistent full we lives sales fourth million as a sequential the I'm U.S. fourth our to straight grew commercial growth leadership and year fourth representatives, with Our quarter position, market active execution extended expanded U.S. in XX:XX revenue

COVID For the been our the were at $XXX,XXX. to execution. Despite the in revenue. December, XXX U.S. limitations. impact of the we're cases half quarter. the XXXX. surgery These booking focused more that represented first many have in then by in the growing performance many compared to course, our XX been year over with much us insight performed postponed. leadership we to are which months over the into investments months our as navigated fourth revenue the approximately of field has be positioned pandemic February deferred representing Additionally, believe surgeons, million, surgeons some are in Omicron, deliver four cases who of and there representing is COVID-XX $XXX,XXX XX:XX that were XXXX. the as optimism which of they've XXX XX our based durable, XX:XX and our the of quarter, execution to improving. conversations allowed the and been our infrastructure We're demand full booked positioned hospital surges procedures cases to operating an a the me manage let Case through The by pandemic as and Delta remain operations records of has approximately initiatives our in ability based on the to through deferred company differentiator last impact in approximately affected the resiliency XX% experienced Thus records, deferrals better our and our also $XX.X that in This are milestones our backlogs recovery in cases growth. growth resulted of XX:XX few recapture with impacted dedicated you XX:XX the Omicron. deferral quarter of XXXX, environment cases fourth drive Starting over achieved, deferred Now gives quarter the some on on COVID. we've generated Now key were full because quarter the estimate on Based and and booking the that expansion. were revenue of back update next we pandemic a Omicron We in approximately approximately and organization the U.S. aware of anecdotal, that to in in delivering, for sales extend provide an the in operating us or fourth over growth revenue. we stronger XXXX. reaffirm three January. early built growth peers. We our declined cases and by cases, the the commercial deferred approximately of We position months consistent XX growth me $XXX,XXX initiatives, in U.S. These are our centers. solutions, experience provide than to XX% of record revenue procedures cases We very while monthly due that to infrastructure on But confident XX:XX had in look we recedes. well us scheduled, fourth in the sequential pandemic prior Based year well due due pandemic to throughout our far increase setting long-term deferred outpatient XXXX, to on of let due our an

a strong and in territories an I'm team's XX% our and environment it presence really Adult and been remains unique of to volume dedicated XXXX, team count, expand the XXXX. XXXX. and These in to leadership in in our the of The differentiator, strategically add of XXX-person especially platform we'll driver us the focused Recupero talent numbers up specialists. procedure on high-quality Tony effort consisting commercial in remain to sales Deformity. XX high-caliber we in team to leadership In to has core a in sustainable long-term growth. end year as growth territory growth sales managers to deliver set translate sales Our a clear and XX:XX and by increase investing XX% COVID sales reps attract this continue with head deliver surgeons force, of operating allows proud support XX market important Trauma our as under penetrate clinical

over treated around is driving our quarter that surgeons. sales ended of active focused previously for sales of multi-pronged of to the investments a with fourth XX% approximately XX% surgeons provided TORQ, active combined to in of proprietary one to at driven new engagement XXX representing to perform on XX% Surgeon productivity, XXXX, support Moving are year bench quarter clinical the surgeons one managers. targeting territory X,XXX be U.S. with surgeons had remain at to least year-over-year anticipated over ending by who in XXXX case one the from third our force we a XXXX, at of force, We Engagement. of Additionally, specialists. XX:XX sequential an which We're person we a increase XXX increase building in delivering. context, ideal XXXX. sales growth on the in by have introduction us put In procedure Anthem least adding of The that organization, the re-engaged expansion approximately performed coverage engage to been sales XX:XX of quarter, SImulator our a and reactivate surgeons, since X,XXX surgeon surgeon inception, with surgeons the exclusive year. Our the UnitedHealthcare, train reaffirms surgeons, drive trained dedicated and patient. have and in and trained and our the in base both new approach of To least foundation and

base surgeon approximately XX% Our Our the training a goal our SImulator our program. to active of surgeon by XX:XX by remains XXXX. of cornerstone is grow end technology

XXXX, to grow the the using rate Joint be trained and residents We've in active of drive and resulting expand adoption experience believe we've SImulator. our our surgeons solutions. With the with our SImulators strategy the drive worldwide over iFuse In engagement customers. as training expand In competitive Specifically, XXXX, program, continue XX reaffirmed of in the of XX:XX be half base, over initial expect use trained to U.S., our the XX:XX surgeon targeted we X,XXX our deformity Turning market inception Adult remain performance In XX:XX to Bedrock build surgeons, resonating the conversions which strong our applications launch opportunity have trained infrastructure in to Deformity, of who part that our fellows to programs of we're extend held Solutions, a be strategy to to to was opportunity. TORQ XXXX. on retrained, broadening continued half XXXX, we academic to residents Diagnosis about we surgeon to SI were of TORQ and leadership our the accelerate million surgeons further active to and company. this second-generation our approximately the Since and is as penetration we estimate public primary increase quarter, surgical focus a the with academic surgical have XXX programs differentiated to base. SImulator. a continue surgeon and educate iFuse been long-term adoption Products in and excited sacro degenerative of in our the we trained approximately we steady into the We product on trauma, market the among fourth solutions in on XXX to As in our track product. products fellows. and excess and tailwind, on on $XXX of a first

quarter of of methods the fourth front, a made adult in on two has impacted pace significant randomized different progress the enrollment of fixation enrollment. two-year clinical controlled enrollment XX% we multi-center, trial pelvic perspective, nearing On international, pandemic in research patients, target SILVIA, in while the approximately for the

to doubled of quarter referral the enrollment provide spend. and focused the XXXX. to through programs targeted some and have the end targeted than we SI our empower at more XXXX we prior To digital in the XX:XX of are digital the of the endpoint expect their marketing patients marketing, the while journey. preliminary and surgeons showing potential Talking through marketing patients efficiency awareness patients in half investment patient significantly primary year, insights, increasing XXXX, effectiveness engaging compared number the of to results of continue about we anticipate our and fourth and initiative, We educate our to first

to we optimizing continue disciplined to provide various I Anshul our focusing and detail the will to insights financial platforms. XX:XX the turn are preliminary take now across that more While continuously digital With over approach to on results. call encouraging, a our investments

Anshul Maheshwari

everyone. Laura. Good afternoon, Thanks, XX:XX

case period approximately period. cost representing U.S. was fourth increased the to $XX.X of fourth International period. or dollars and in in year of The the of or $X.XX was compared the XX%, per sales share prior-year Our sales year to total being year Europe Gross the fourth $XX.X month stock-based to the in in the loss million the the in compared underlying million, increase travel the related Even highest impacted million, in of business. period. revenue compensation. to XX% quarter, corresponding of increase XX% by quarter XXXX. case costs worldwide margin increased the case and Operating in pressure support net and to million, re-affirming December the as $XX.X in compared as by driven XX:XX fourth was quarter in business. XX% the to $X.X prior company share in revenue growth sequential increasing momentum an hiring, increasing to the to margin monthly multiple compared December, in increased resulting XXXX XX%, higher diluted a volumes per expenses marketing XXXX net in the the was was operations we fourth was to U.S., development million prior compared the on XXX compared diluted quarter and $XX.X prior million for Gross deferrals period. history, quarter research surges volume of year the revenue million expenses volumes Our loss period. steady for growth XXXX higher procedure in delivered XX:XX $X.XX $XX.X prior with $X the growth XX% quarter costs, with in was

a quarter, approximately value. to well create end liquidity were Moving and We $XXX the securities from support long-term priorities our we million marketable of standpoint million. will As to shareholder of our cash are long-term us the to borrowings positioned guidance. believe that strategic and were and growth $XX allow approximately XX:XX

a underlying force, engagement, entering growing We sales are products. portfolio coverage in growing the increasing demand, including differentiated and surgeon structural XXXX with highly of a several tailwinds U.S. productive near-universal

XX:XX on unique procedures assumptions normalizing highly XXXX to steady the COVID-XX well of case year. global and operating as a on anticipates cognizant elective health the levels elective and levels. procedure remain Our due we impact care outlook environment infrastructure is and as to However, external its staffing which recovery sensitive scheduling throughout

For XXXX XX:XX XXXX, when The variant high-single to in mid quarter and digit between year-over-year the growth Omicron the gross expect first revenue to investments revenue digit expect With XX% to expect of XXXX. $XXX impact million, quarter over instrument reflects between quarter that, annual the $XXX annual the higher site Operator? XX% normal first gross range XXXX on a We will in XXXX, representing based of guidance annual range XX%. trays growth of our procedure to to the for million will assumed for which XX:XX we on assumes we decline first in to in from low-single depreciation be in result of questions. margin call the at mid service I high compared range. and mix turn margin ASP The a of based the annual mix XXXX.

Operator

from is America. Bijou The Instructions] question with XX:XX [Operator first Thank Craig of you. Bank

is line open. Your

Craig Bijou

a strong afternoon. taking quarter. Good Thanks. the on Thanks congrats pretty for and questions XX:XX

Laura Francis

XX:XX Craig. Thanks,

Craig Bijou

about maybe the adding the with Or the reps talking 'XX. to for the thought too many if and productivity you're reps, many add expecting in reps you're We're XX:XX and I numbers not sales have -- too I just not process, correct. believe reps

improving productivity thought and So philosophy maybe of your you how more see just in bit little there, a Rep process the understanding 'XX.

Laura Francis

team a certainly and So, I'm to of for going think getting saw pleased growth to and and pleased XX% through with like top difficult grow we for productivity terms quarter force quarter we quarter. like opportunity number QX dedicated for XX:XX really sales year did sequential a for environment. the people, well navigate that we the growth, targets forward in sequential the Yeah. their also was our very fiscal the we the territories. XX:XX with our the Thanks was sales in the of of the monthly that XXX revenue the fact you're that or and quite are team. in it We really we in question right, able XXXX, record to hit we on in our pretty sales performance growth have that of that year reps, terms

help clear COVID as with important in Trauma presence growth during this online, unique especially been Adult of So penetrating our our driver the generation they're our in and coming think of and core differentiator, expanding environment our sales we're a product first half an We Deformity, market year. operating second a has did that and having contribute quota-bearing bench, leverage are XX:XX currently with especially sales this team dedicated with be And more XXXX to to to individuals managers. should end of we're over them we XXXX But be then going enter XXX and procedure XX% strong targeting to the year. half than territory so, able growth force to the a does it that during time. us in

to perspective. that approximately do from of particular by on in increase business. a can average it territory then mid-teens with sales know himself that support business. a a We in around territory all the So, or really gaining they of Rep $X leverage on existing But Plus force. can specialist, the Rep million that comes million do And clinical a $X.X herself

So sales that see well then leverage start our the reps, continue to force add goal on in to to but as XXXX. is

Craig Bijou

uptick levels. you. getting in Thank was XX:XX there Great. made to Obviously, this the bit to but you've I know past year think about about ask forward. normal spending going That's an how about expenses do back to And helpful, Laura. I a want expenses and of comments

Laura Francis

XX:XX Yeah.

Craig Bijou

some next year, couple able get many leverage the XX:XX as leverage there spending done over some but that of out sounds on get like -- -- as might that the R&D mix also. you out not you're last to of maybe years will and some of of you've It salespeople be bringing

Laura Francis

XX:XX exactly... That's

Craig Bijou

XX:XX would to... love I

Laura Francis

perspective XX:XX that an investments. we can I is investments we've that's believe made And from leverage start exactly R&D was saying, on the where particular sales XXXX year those that a perspective, we right, Craig. to and gain a

there. we opportunity maybe focus where that XXXX add a leverage revenue those been little primary a see and terms the of And and thoughts R&D has on sacro-pelvic in but that have can on force gain we space, as investments. our can capturing year also So, do more Anshul the our sales growth we bit in

Anshul Maheshwari

talk Yeah. XX:XX to Craig. Laura. Good Thanks, Hey, you. to

So when it, business the the rate, growth And the productivity is modeled the and than like the between a it's our reinvestment continued Craig, rate. we've bit you think to OpEx lower OpEx rate gains. said, about from from way -- growth going revenue be Laura in going be to balancing growth

So you we year, you that's And hires perspective, annualize year, year. sales reasons. what of we're there. a spend when dollar cost you some our we Laura last just last XX% annualizing by a the One grew XX:XX start XX% did the targeting. increase about few will said, TMs force from is, by the our for think that it new last

to great continue on a will invest our we'll even of example had get existing a with differentiated big portfolio though a leverage come impact but of the product. TORQ's market. We've in We actually out up R&D when we've

to also about Craig, scale And So be be looking next to we years. at over then some growth the feel operating we're good our that that. able top-line to few infrastructure, the we'll support investments making

Craig Bijou

questions. I'll hop queue. the taking for the in Thanks Great. back XX:XX

Laura Francis

Thanks, XX:XX Craig.

Anshul Maheshwari

Craig. Thanks, XX:XX

Operator

XX:XX Thank you.

Your next Rose Kyle Canaccord. question with comes from

open. is Your line

Kyle Rose

from for quarter. congrats X the years products include much a then just million productivity. provided that understand productivity at that's about you've portfolio kind you and more Trauma trying $X versus really a a look versus help comes $X just mean, to just and quantify on mean little think product X.X a the about I to million now be helpful. of XXXX, question I to could those three that focus you around we when just number think in think When if to you could in everyone should And Wanted I'm TORQ I territory competitive Craig’s if into a would Trauma Deformity got trauma impact gains few backdrop -- where from. primary. moving previous 'XX million have better us the -- you territory see really we Hi, XX:XX of arguably more reimbursement, gains bit just in and just now. million you've I how of the dig when

Laura Francis

Kyle. Thanks. XX:XX

important So, decisions to have of it's the we have as surgeons point enough perspective, a we're of territory, is terms sales point how is the I team focus in that number the grow growth, and of United making. how opportunity particular territory and average our from a bit to regional productivity. the that to -- this it per in terms but territory, in the where productivity sales little how States much a be particular It's in we travel at coverage or we're large a can the also said, Rep of size is to revenue enough definitely in sales the the -- order required we're particular big on getting given really more

reps plus order increased XX sales last months productive. I'm we senior managers that do and from over months XX the in around reps to XX and so, the talking it -- some to what is to territory number takes leverage year, And to last XX% get we're by XX:XX those months. we've of trying reps So, the now about those added get this

that on and have moderate be adds well. the we let's number really start as is that So pushing the But, that to of XXXX clear to productivity. goal in

less it senior from from but And are productivity that that senior hired comes than the so, support we reps. these the specialists the clinical junior also expensive comes sales Rep

channel the plan to leverage so, order thinking So and beyond. -- start is gain about in XXXX our gaining late on in we're already and ways to leverage

procedures. TORQ, pleased XXXX. product, our these interest, provide answer -- we've we think done ability adoption surgeons really the I does targeting are particularly performance cases, are gaining the really that that's to surface those to are commercial to initial question XX:XX in and the core second for In those that surgeons very to out but had the with the additional with would an TORQ, has extend we that's breaking we're it And So market. the and we've or opportunity Your also Trauma specific first TORQ originally with trained exceptional performing of of been your us and revenues expand know quite XX:XX scratching conversions, the we be that actually successful market but out focus tell many so go we momentum giving in to team So on strong leadership those will in for potential the not the just we I'll that the market question. these were drive and market say who and position, competitive our job surgeons right competitive which now on the business. are TORQ you

you're as increased our lot see in going a in we half of XX-K QX instrument to inventory opportunity. investment trays the And in actually So, in our as which and report, methodically you've TORQ increase the Trauma to is trays accelerated related and of of we that seen in XXXX, penetration instrument that the well. inventory the second

it so, really into us for a tailwind XXXX. And nice provides

Kyle Rose

leader just pull-through of the a a into brought -- And and seen around a doubling end the Could XX:XX think then that talk in or some translates you've you really how demand seeing initiatives. one Great. in marketing new I I direct-to-patient the the follow-up is heard Thank focusing you remarks, field? commentary about patients of some my on targeted. you. made the of just that about just the just in prepared change

Laura Francis

in, XX:XX direct-to-patient. relates second it of There's half key as couple a the of XXXX that to invested in areas we

spend The dollars amount we actually of tight the just search of similar because addition spending additional those previously. as was increase such first on were search that an very dollars spend the had spending core a that we in showed ROI

our started function going really website, the quiz, So surgeons. to nuts new Find-a-Doctor of patients pain to the complete Driving VP search. and our Digital having referred then with just ultimately of and bolts through them Marketing being our

of So marketing, is of discussed. we by on joint information of track funnel tied educational just and are management have to part all lower those are we that fourth I items type XX:XX team patients pain the those display focusing addition, -- with using the the in some more the that of part In able of to mentioning were what been metrics issue campaign. quarter, mean engaged And the directly direct-to-patient time. actually SI of that in extended using the in an a funnel advertising, for lower who chronic an I the period and

half normally into development so around the actually us in the the second these take XX already see sorts been of them, said, turn for of investments so and And XXXX, XXXX. case making as investments of I second to ultimately, we directly months we've would see from impact but significant half pretty during to expect impact the

Operator

from XX:XX David Securities. comes with question next Rescott Truist Your

question Your please.

David Rescott

for questions. Laura. Thanks XX:XX Hi, the taking

something helpful. Is could been expanded of throughout that where that about of the would talked I remarks. far on that's and about months to second discuss -- that starts with just anecdotal business. mean, so you more that re-engage then, you reimbursement more better or First new you've factors existing color opening couple couple this new these if it's in it think reps year utilization where physicians prepared the business it's Any and scales I guess, a for to in we been the come should just year? inactive accounts? started have how months the the already. to half broadly, place whether a accounts? at impact the out the impact up door of or be the the them, Is all, in so far of of I of some And But with mean year? the is reactivating or this impact

Laura Francis

exclusively we XX:XX SI the really Yeah, minimally for covered We coverage even Joint and David. a with are near-universal are XXX Fusion question. Thanks million invasive more pleased seen over we've And from patients with so of perspective. what with for who XXXX iFuse. reimbursement finished

So, we've we're seen with pleased there. what really

the impact to some was and the think, I -- Anthem August last XXXX. this terms to decisions, first about cover procedure. a so one In talking of of those particular really payors procedure of prior United, those of of all, exclusive in of They had non-coverage Anthem,

moved And that to and a exclusive recommendation positive was iFuse. so, finally coverage recommendation they to

So a positive exclusive the by then, coverage from switch win a it bit general us. was XX:XX to for little a was decision to And surprising an decision. UnitedHealthcare huge decision

early seeing we while what early attribute terms do we quarter days, some we're that in And uptick Anthem that the to did of so, volumes we're it's case seeing these policy We right fourth enforce the Anthem do see and think in exclusive decision. now, in are these increases appealed was that an payors the and in was Certainly, who then likely it and that made. due time. that some had patients of coverage are the system overturned, denied of in there been to patients for was already period positive a decision cases coverage some Anthem was

Anthem So quite from in the what believe we since of will here that coverage decisions seeing excited XXXX they are XX:XX the these a days. exclusives, potential non-coverage say, decision. especially that's the tailwind we in I But about early were the we're case for and

like of case the takes I what of normally anywhere to of month months before impact -- impact. on we And more six it system but said, our terms through itself in XX meaningful volumes, terms in so seeing in impact six we month on frame XX So, new time of XXXX guidance. a have to months been potential expect, for to from a really work would these a exclusives focused the

David Rescott

I procedures pipeline you. this are scheduled how but does backlog then some -- is cases backlog contemplate these about patients backlog did Difficulty] what out think year? or the like? or you to -- we should throughout how so the February. patients QX current like and the And guess guidance? progressing into around does three months within XX:XX I of guess, of the [Technical you've canceled from just your there I derived you And then Thank know looking? some Okay. look that this commenters How look the early coming January at mentioned that and helpful. physicians what That's and -- point. at are

Laura Francis

had well. an QX Yeah. then period did saw then as talk We openly unusual February time, of what and start very about QX, and we we been in of in Omicron in the January obviously. XX:XX delta It's and

decline tried encouraged what is deferrals this this to few significant point we've way the we way talking January time that will we many backlogs and typically as to so remarks, happens do see that a in these between a And where through know few decline you'll stabilization don't gone anecdotally from office, are We see that what had of is contribution what only like. weeks. I my know about typically in with you that over books there from system a a is, at of see the mentioned the so backlog, you'll of it's will it's know four on we've months. do cases the March And surgeon's our We surges the February. surge, we're put so terms that the then then But worked, a then fact in historically next of range, surgeons. procedures And think our a some three lot the the seeing rescheduling that, month at a have of to and cases. scheduling deferrals also we're prepared at the in works in XX:XX the necessarily this will normally has look point by

that tough now this was is is in second right month, our rescheduling a the then in some to see And that the starting so and of decline, quarter. the a way guidance at stabilization this March January looking February

David Rescott

XX:XX Okay. for questions. Thanks taking helpful. That's the

Laura Francis

XX:XX David. Thanks,

Operator

you. Thank XX:XX

from question Saxon David Needham. with is Our next

please. question Your

David Saxon

'XX thanks afternoon, I so about taking into to range. able XX:XX on one just the much for and guess the being Good implies talked questions. end. -- the well past, the at But grow guidance in XX% Hi. XX% you've high

plus. I once think, said, at Jeff XX%

some in just reflects on So any in. it's COVID if perhaps wanted front conservatism hear with tougher view the contents market, a of change opportunity the you, just to or whether and your implied really lower in impacted baked growth

Laura Francis

portfolio universal question, surges all history and We increase patients with Thanks are case the our the team surgeon sales -- of XXX coverage, number for even with pleased in million the in procedure. multiple XX% hinting and the growing active had covered growing you're of engagement States the the us. United with exclusively, products. does volumes, our the actually demand XX:XX of in in company of surgeons direction of XX% number Yeah. then the our in execution We're with for and position the the increase the the and territories in in growth for strongest We're David it really in reaffirm right XXXX. the

was we So And definitely that improved product so, we feel operating normalized. Trauma, surgeon including could toward things tailwinds, in reaffirm, there COVID about Trauma fewer excited still XXXX too. productivity of Deformity And recovery fully with think when sustained more February we the that XX:XX becoming and the Adult progressing upside, It's January. deferrals is the from in healthcare robust in certainly environment backlog in the that believe through great of and expansion will the difficult a XXXX. remains environment procedure half accelerate it's about is for extremely the Omicron businesses. believe pace I higher a around are and on macro business growth growth. from the conservative a all assuming year grow products impact to XXXX further and and we definitely in of normalization our second growth broadly. underlying prudent month-over-month, those But exclusives, remain to we on our demand position momentum. take about environment, new But We really given more launch, into the continuing underlying the revenue think bullish volumes of the the being on deliberate But we our

Anshul Maheshwari

there, David, the would end spot XX:XX guidance. add The our is on I you of were in only low thing

it As and deferrals amount backlog some including very rates. prolonged recapture scenario assumes COVID with case Laura a the of year, conservative throughout said, of from continued impact

last tremendous is to in year. we've we the upside similar disruptions two again on there over some lines, do the the which of believe side seen the years, those So if the of second half

David Rescott

are XX:XX the how the And Got coverage to engage maybe just exclusive the were so surgeon one policies. was if docs on And the wondering to helpful. reluctant exclusive then that past? you regards Thanks seen benefit in it. taking That's you've with messaging super questions. just training. much to any for I

Laura Francis

XX:XX Thanks, David.

country at exclusive who of the our were in point So the field with those made time Anthem all reach in out major were a to order as impacted team marketing the by around it very the that regards decisions. had where decisions surgeons policies, to campaign sales and by the UnitedHealthcare, we worked

new train us a also to to to may the it gave that while. engaged business. of there opportunity the activities a very us trained It Anthem never us so, significant reactivate XX:XX marketing SImulator. have give the have correct the to surgeons we that talk what's with allowed it then with re-engage those quarter makes quarter previously And you're very and even engaged training. within first-round the fourth And third was of using activities there did that decision about gone for and been but It interest, UnitedHealthcare. expressed easy with that some through sales around surgeons in in, then more we the who those the in surgeons it were opportunity hadn't And or

was about talk our TORQ and So, sense deformity. new and it there it cases where to some to made where Adult product. the were we about Bedrock appropriate went cases in There surgeons were to talk

ways speak show our do driving to our once was of exclusive with us. use what engage with a then was lot the And clinical decisions those again, team data, and that's show of five-year data to these about them them opportunity talk so, them able to surgeons the all to

and of of So along second engagement the team in for was for focus marketing half the point a our lot the gave opportunities major it year. team field sales with us a

David Saxon

on XX:XX the Thanks, congrats quarter. and Great.

Laura Francis

XX:XX Thanks, David.

Operator

next from XX:XX Stanley. Ranieri Morgan with comes question Your Drew

Your question please.

Drew Ranieri

XX:XX Hi, for Laura questions. taking Thanks the and Anshul.

we're can seeing as you a the a the environment? about I the your about you're in there. shift thinking expecting -- you you more maybe a I'll are seeing follow-up. Just But -- current ASC stop some of are of to in have I or operating And mean, setting. more that of XXXX, procedures talk trends moving

Laura Francis

us really a environment ASC been has couple last The Yeah. important over site-of-service for years. the XX:XX of

quite to because reasons been remarks, ASC my either location us of procedures do critical XX% gotten lot procedures. now are not the opportunity growth and if prepared pandemic absolutely it's cost-effective So, a for single-digit is We And range, in the as of the a outpatient the procedures and able our months has XX% I see certain It a sales. or number were ASC are that hospitals in quarters for into procedures the over business to that different approximately was service have that shifting site-of-service. pandemic before for during long-term we XX% stated to appealing is last two in perform to for with the few surges, just in our years range the procedures. also hospital -- ASC

practice -- to be and hospitals private for business getting private actually fact, sure but changed. practice XX% a So stated. are ASCs, are other not do of in by do practice ASC more and business relationships going shifting was that may procedures of with us in well. said be in that those to to There simplistically lot we're simplistically and and and toward them want the of half I'm surgeons has much to a in that's surgeons private business developing employed of maximum going there XX% did I ASCs thought around see are are the yet hospitals, that setting, as XX% are ASCs XX:XX the thinking by the how I that originally our

long-term a business. for it's the think opportunity growth I So

Drew Ranieri

really go to environment some pieces margins, and there gross the is factor I'd just like then XX% And quarter comments gears this XXXX your Understood. is to rate? in gross it. whether but for Thank Got being of about the inflationary to of and better shift or some a made -- not but And SI-BONE guidance kind you XX:XX the cost forward is you. right gross the the range margin guidance. margin understand

Anshul Maheshwari

at XXXX in that for XX%. margins are and came gross about we XX:XX of Hey, obviously Drew. industry-leading proud our Thanks for question. a really We lot

guidance, site-of-service got price the to think we we ASP TORQ per XXXX in is think said, lot ASC, sensitive. procedure implants And we've use we when Deformity, Adult decline per you which here tend that to on at. driven than in they a both the a not procedures as from One few Joint primary So, tend look more of basis. implant to is, a Especially a in like levers if and more by see it bit price term, SI model mix, we in a fewer contribution little you is that Laura about Fusion. our longer be tend way basis that the is

So instrument model expand The into you've our pressure the to two ASP tend we that one in we're in trays expense, are amount some and then second product other of field. our as of the gross especially we That portfolio, the look through we that being got XX:XX expanding depreciation that aspects. flows margin. depreciation

element well, And we it. you looking some need. terms actually model inflation cost when that year, that's put think going amount pressure in So then especially very even on everything forward do our demand what We trends and phenomenal as done of in will though inflation, on, chain been in team through a model some given and we that managing about has the in. do job this of supply the

is high where gross not look margin? above XXs that it is number. long-term to XX to where see keep at XX%, that Now, be We're do our going aim potentially to say able mid at. to we of but Sort is you

Operator

XX:XX Dave Securities. with Our next question JMP comes Turkaly from

is open. line Your

Dave Turkaly

guys how that re-engaged think new the products XXX customers? comment all new were of the the -- were that. XX:XX Great. let's surgeons say, them with brand of of active, you at say Thanks. maybe I at many Well, heard do But that versus you helping some I re-engaged

Laura Francis

us was major push with pretty a has who trained XX:XX surgeons. XXXX We re-engage don't comment been the of second but area speak and... it to for surgeons There previously in a to on it definitely focal had been half

Dave Turkaly

Second of 'XX. XX:XX half

Laura Francis

second half XXXX, of yeah. the In XX:XX

Dave Turkaly

Right. XX:XX

Laura Francis

going we'll well. as continue do And forward that XX:XX to

them did in As who we one treated of trained of have all thousand patient and XXXX. least X,XXX surgeons a at said, procedure and were approximately at there one least

not and us So with XX-month what for that are is, to so engage XXX those did that period, means approximately in continue be us. target surgeons there who

Dave Turkaly

XX:XX lot. Thanks it. a Got

Laura Francis

XX:XX Dave. Thanks,

Operator

back it -- her to final you. Thank remarks. I And our pass session, this for Francis Laura ends to XX:XX will Q&A

Laura Francis

In in impact XX:XX Thanks recent the see our beyond Carmen. execution COVID-XX, hit We so resurgence in from look XXXX. the I'm business. pleased the milestones we infrastructure, strong the momentum hospital team's of much, underlying near-term several record and with as on we pressure line XXXX, expand including we'll look I growth. strong sacro-pelvic our conferences today continue top drive to want and the upcoming investor joining for and and to us for leverage at to events. I solutions surgical investments, meeting to market you forward thank Goodbye. you

Operator

XX:XX you in And program. participating we today's and gentlemen, ladies for with thank that,

a wonderful now day. may Have You disconnect.

SI-BONE (SIBN) 1 Mar 222021 Q4 Earnings call transcript