PRCT - Earnings call 3 2023 | PROCEPT BioRobotics Corporation

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Operator

Good day, and welcome to PROCEPT BioRobotics Third Quarter 2023 Earnings Conference Call. [Operator Instructions] As a reminder, this call is being recorded for replay purposes.I would now like to turn the call over to Matt Bacso, Vice President, Investor Relations, for a few introductory comments.

Matthew Bacso

Good afternoon, and thank you for joining PROCEPT BioRobotics third quarter 2023 earnings conference call. Presenting on today's call are Reza Zadno, Chief Executive Officer; and Kevin Waters, Chief Financial Officer.Before we begin, I'd like to remind listeners that statements made on this conference call that relate to future plans, events or performance are forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995.

While these forward-looking statements are based on management's current expectations and beliefs, these statements are subject to several risks, uncertainties, assumptions and other factors that could cause results to differ materially from the expectations expressed on this conference call. www.sec.gov.Listeners are the more all these Securities are online uncertainties BioRobotics' in of forward-looking and to November available with not X, only filings and at today's statements risks which disclosed reliance as detail in PROCEPT which place speak The undue cautioned of on date, are Exchange Commission, XXXX. that PROCEPT statements may to update or any forward-looking to Except will new certain obligation unanticipated the also as in or financial are arise.During no with events required call, we measures BioRobotics undertakes GAAP. by not circumstances reflect law, accordance information, reference revise prepared that More these our that, I information measures of measures financial to the non-GAAP would like their earnings release.With to equivalent we over about in use turn to nearest Reza. these included reconciliations as well call as GAAP how are

Reza Zadno

joining you Good for and us. afternoon, thank

sales, financial who guidance are Q&A.Starting international system by I quarterly and we million, U.S. the XXXX. additional pleased details base For quarter update the both business today's revenue quarter revenue increase another Total XXXX was increased with opening to utilization our the to followed and quarter the call, compared comments call customer record will installed results, of to in provide Growth from expanded opening increased strong and $XX.X the performance will utilization updated for Kevin, our provide report system third by strong representing regarding and before U.S. XX% XXXX placements. of of our growth third to revenues. quarter driven was

to a consistent of we Aquablation the in data, long-term territories. in focusing of have the use strategy led of reimbursement therapy, driven quarter, U.S. of to of in robot of unit capital growing our outstanding growth placements me the reps compared discussed, greenfield previously team by new prior have third XX Aquablation the coverage QX building XX% and addition field we was clinical representing of sold The therapy.In top-performing the year. awareness number growth As robots our on

reminder, XXXX due to new we reps As by in added capital a XX expanded capacity XX%. sales late QX

capital X productivity added months. XXXX stride X of quarter their is typical ramp as As in the reps to the have expected, the fourth hit

we of largest the our macro the grow with force to our analyzing the to the compared to quarter commercial we with very capital sales continue fourth strong challenges monitor quarterly revenue hospital recognize and consumables continues While very in that of and a current and senior [ closely, the of XXXX. we capital company's pleased to environment third good environment trends. utilization ] most overall the of fourth feel having handpiece capital be quarter the pipeline the entered now execution spending on robust continuing accounts, XXXX in extremely utilization. XXX% about history, increased quarter XXXX.Next, U.S. and continue When we touching meaningfully.Given

account accounts in we per installed quarter. Our the ramp, utilization X to the of has compared XX% third time XXXX. grown U.S. in to X.X of monthly And new while delivered months base take end handpieces

which the current procedural surgeon both We are previous within care points active standard any have given account-specific seeing we Aquablation growth, combination primary a surgeon the months encouraged where performing a surgeon and on hospital.The is receptive of as by retention XX% is greater X active be are drivers surgeon utilization of what of the in XXXX. continues viewed multiple a retention therapy surgeon who first case and We of for quarter. rates to new than active as performs proof define procedures growth and

base, lever momentum of we ability in increases of this commercial new can our quarter. to and our team seasonal focus from greatly confident the strong surgeon benefit underlying installed we company, on volumes, surgeons.Given our procedure retention fourth UnitedHealthcare training tailwinds elective sequential utilization from the our a monthly high As in in remain addition coverage level as across in utilization

results inception therapy All gives go what cancer pipeline, been shortly, therapy which how the the leaders through our we regarding Aquablation have targets.Turning continues clinical to logical both trend a ramp therapy, XXXX be to Kevin Our a small encouraging prostate patients, in revenue treated the reps awareness telling prostate what was that capital our by continue Since growth their of second Aquablation The men real of cancer localized treat achieving seeing half XX,XXX initiated key we study informed world and step.In rates. to BPH BPH than are guidance, opportunities pursue greater are area. feasibility treated to new next customers us growth were as investigating we gives confidence now outstanding who of which overall of XXXX, of of in indicators invest many experience, prostate our this as confidence encouraging, updates. the grows, in cancer these positive us clinical productivity around merits prostate to will the purpose to treatment opinion us Aquablation us progress, and Having therapy. of have option. felt assessing safety with Aquablation further cancer

our sites the IDE cancer of the Group data, X most BPH enrollment with and increase to to X from men for to allows and of expanding study, include our patients prestigious the across evaluation U.S. we Aquablation the along that Specifically, support the cancer With of future and I early September men said, safe month, in XXXX, XX today the less the relationships study standard efficacy NHS cancer announced activities, effective for phase. cancer XXXX.In of in those therapy data of legacy experiencing also stress the for prostate therapy respect we study That outcomes who with market localized this significant very Grade provide investigate if United September desire in in approval relative feasibility United and IDE therapy or BPH, with research we also pipeline BPH for up this arrangement granted alternatives, our research in developing prostate X Kingdom, Furthermore, The last globally X strongest therapy. urologists single-arm Aquablation PROCEPT.With prostate X specifically still to we safety meaningfully. were to cancer. initiate strong deliver with clinical remain States recommendation, approval and and for XXX BPH able the prostate recommendation we centers. enrolled This can we to traction prostate announced international a contraindication the will FDA Group Aquablation could large have given want when we grown cancer. that patients remove for globally. we us at that are combining with will a to are are urologists to to its be development NICE the prostate has cancer Grade endorsement [indiscernible] be to to opportunity this hospitals in Aquablation pursue

the from plan to and selling over the next Given U.K. investment handpiece make and we to on growth.Turning unit months strong Japan. economics surgeons the U.K. additional system in prices, XX average the accelerating accelerate to interest

our patients of survey through halfway and complete than by fourth to expect post-market enrollment in enrolling more are XXXX. We quarter

to the as contribution Japan support raising August, additional very launch.Lastly, the offering, early with to strategy a and United successfully Kingdom, continue follow-on and become Like financing from is the was revenue net we of an to equity strategy meaningful in to lead sustainable data treating goal a an completed expect Japan not primary million we sheet long our to review do clinical more $XXX standard in proceeds. to from on care robust strength XXXX, term. position attractive allow the of market the U.S. fortify balance The of our execute to we a men commercial BPH. the While of long-term us

our our Xx team September is at have officially new a an point, growth previous in funnel the of while XX, moving size QX this consistently and In platform. without we of growing than will balance this achieve therapy.Monthly the we cash financial breakeven degree driven San is metric our track approximately sequentially guidance grow these our closing, continued are company on Aquablation to to meet relationship our we long-term to and Every high providing we growth direction. the to In summarize, have $XXX mid-September, in headquarters to sales facility. As with pipeline reinforce of awareness also future sheet, not reach surgeons. of And Jose believe utilization allow in more in financing.We enough flow sales XXXX our catalysts, right strong space which ability facility, business and million continues additional confidence growth the goals. capital and experienced of accelerated to of we corporate cash our the moved will which had to by

BPH over currently our ability With to quarter. the we all offer BPH QX the in public plans of therapy of successfully XX% United I an said, can call in in our addition equity being execute hospitals we XXXX expect with account financing of Aquablation on Aquablation cost UnitedHealthcare annual which vast. to exit will performing men control will to about becoming mid-XXXX, for only United Demonstrated roughly XX% the to resective for investigate to remain and represents our surgery.With States. received X% sheet, Aquablation prudent Also, in now to procedures hospital the the IDE States. that, prostate balance our than X,XXX bolster therapy therapy XXX each approval company cancer.We since And take of which only a that customers, and With the we made we resective excited have remains us progress turn believe Kevin. to profitability. opportunity we greater lastly, completed

Kevin Waters

XXXX. revenue third to compared $XX.X to of Thanks, surgeon of compared for was installed XXXX.U.S. quarter accounts an of quarter period. sequentially representing new utilization quarter revenue XX% second U.S. revenue robotic Monthly the launches $XX the the of was the revenue X.X% was to having increased the handpiece surgeons. most with of was by program quarter was third representing and X% revenue XXX% of million, strong by systems. growth the growth of to the driven XX% U.S. for both per the of in for by driven quarter Reza. at U.S. of increase growth million, XXXX. quarter growth multiple million, Total $XX.X XXXX interest third compared base year third consumable prior third growth in handpiece representing the quarter handpiece compared account

see prices X,XXX third selling XXXX. existing total continue the $XX.X U.S. quarter, in surgeon approximately the of continue average compared with the third growth to XX U.S. base. robotic account increased representing revenue handpieces in train level compared $X,XXX.In time of shipped system utilization surgeons utilization new the XXX% sold of and unit of we over systems, to increase as third XX% Additionally, quarter increase of our to we We an quarter generating the third of XXXX we to of million, quarter,

of which is systems, Our quarter U.S. installed is now an increase the XXXX. compared at base quarter to of XXX end third the the XX% at third of

operating the system the to revenue produced.Moving for in expected the $XX.X quarter was to number was prior to to in margin operating quarter the driven expansion QX XXXX to absorb period $XXX,XXX, primarily in prices increased year were units Third in balances, total million was cash and includes equity expense, compensation $X representing XXXX offset were quarterly Gross as income million, increased and our was variable within quarter over million XX% administrative our to XXXX range, our million the XXXX by equivalents with and research ability which primarily loss the and prior $XXX for XX% equity outlook. million expand of of as third overhead sales loss other due general offering third EBITDA $XXX,XXX our in development of third remain of revenue August.Net compared the quarter loan our International and in the for $XXX Total marketing of approximately quarter cash years. the expenses and $XX.X our expenses.Total were a were million raised of $X.X is in was compared expenses average $XX.X income $XX.X third same previous increase early $XX term the interest million the of million cash the million increase expenses XXXX.Our XX%.Gross was period commercial interest recent expenses the sequential expense period. to $XX.X September financial and given by and XX year. compared compared third balance of was by larger of income significantly prior was to second When favorable statement. of margin loss quarter million, interest of of growth August.Moving to from proceeds increased down our quarter lowest same increase the selling organization X XXXX, a the and in from variability. of which The quarterly increased million Adjusted expenses year. financing which in in net over $XX.X a the only to compared

guidance increasing representing are growth compared approximately to We million, revenue of to full-year XXXX. our XXXX $XXX.X total XX%

system with to we based following be factors. We are sales expect U.S. the guidance increasing Starting our systems. on full revenue XXX systems, year now

revenue. to we quarter.Turning handpiece quarter relative the expect normal more sales Given increase and seasonality third gain, capital sales U.S. to fourth to system a experienced

We by implies average handpieces fourth account per to the the per continue utilization be full-year per as X.XX account handpieces weighted expect in which month, approximately in to sold measured quarter. sold mid-Xs approximately

Given believe fourth quarter normal than offset utilization increase more installed procedure base, the allowing to thus seasonality, continue sequentially. this to will expanding we

to selling to revenue and handpiece the be $X.X be million. other expect average we third price consumables to quarter Additionally, our comparable

momentum, Lastly, statement. million.Moving now continue be $XX.X full-year to the full-year expenses million. revenue and to to revenue, XX% XX% approximately $XXX down expect another given gross income range in positive on to strong and quarter to We now margins we approximately expect be be to operating of XXXX international expect

cash larger million. our million, recent be subsequently interest in income $X.X and interest expect net we net QX full-year raise to balance, income capital of Given resulting $X.X

adjusted that, to EBITDA of we back expect $XX.X I loss Reza closing comments. Lastly, to a call be million.With turn will for the

Reza Zadno

journey Thanks, I help want of support for closing, our Kevin. the standard their care to BPH. us customers our along all becoming thank shareholders to In to for employees, and

look leverage take questions. investments many great day, at seeing a upcoming continue commercial of At you execute and point, and forward will to will our on this our clinical I We Have strategy. we to long-term conferences. investor Operator? to

Operator

Our Bijou of first Instructions] [Operator question come Craig Bank from of will America.

Craig Bijou

you usually love very comments with as important previous quarter. your Congrats systems, system would there. little trends they but as bit to ramp? kind utilization, start utilizations systems, on adding number how of And I those you're and hear to guys. -- seems, Want cohorts, pretty on the strong a newer it a color to of, do, of a how Reza, new I appreciate just more

Reza Zadno

in give going Craig. a going Hey, go just reset Thank Craig. had We're to We here. -- your just off apologize us one second alarm you repeat you and please here. turned to I question here. building. Can everyone It's we're the off. fire much, very to

that. about Sorry

Craig Bijou

All right.

utilization. So

when comments systems know place system, I you how seeing seeing some Reza's that the the how just you're understand still are comes increasing, Appreciate So, cohorts the ramp? wanted new to but to, guys guess to you down older utilization question I with wanted that new you're of are adding? that a

Reza Zadno

surgeon. the we very talk we Historically, I some about flat, utilization and -- underlying and was, trends, an surgeons we is generally happy in existing saw one, in but existing those. want increase we saw existing flat, in -- our quarter, with to We saw this of saw QX increase an is QX are that the surgeons, number our a

contributed largest number utilization quarter this the in and had retention. in also surgeons also We that to of this entered the that new and increase

add factors very So, Kevin to I'll these this. utilization QX. good are let led to the X that in And a to

Kevin Waters

are our look on summary. focus mean, Yes, a on accounts, Craig, you rep our utilization. sales we think focusing new And, and team and to at it's seeing today good I testament Aquablation I know, we it's a when

pre-IPO, when have due So, that, years quarter. new we team, we're third growing And with would to back that's sales accounts launch within surgeon we of that but X. I go our typically in launches program it's now many to If again, acceptance lot we're to of a seeing market and On account. seeing X today, a mean, the Aquablation. most and X of general accounts X X X of I surgeons due launch top awareness to lot

account a was nice really new it launches. So quarter for

Reza Zadno

our telling -- amongst patients has this awareness also treatment. we that are asking they And and hearing asking the are us surgeons patients for are increased

Craig Bijou

want also to And funnel. about ask I the sales

You guys track this what QX. in closely. guys rather in that I systems sequential in versus expect saw appreciate you you pickup QX

confidence from else market purchasing changes or capital see, your have to cycles any conviction impacted? just in the may anything or of you the visibility. of capital be -- So any wanted kind And or lengthening that that sales in,

Reza Zadno

part So, is I really by of The first want driven demand surgeons. answer your question. to

As said the champion, surgeon we past, our And in finish is to it's year, we and it to the increased. there is line. this among that larger by capital our about for year. very have parameters time Kevin the once a for surgeons last we have I same deal, difficult goes -- that's demand generally the And than force know, are have increased also do the confidence. lose don't identify surgeons you us awareness driving sales And These have technology. gives the XX% what the

Kevin Waters

think by.And did quarter specifically, that think our today much in we're a back when guidance we ability into reps I year. our is addition of beginning team, see to question, large kind the higher rates. half that similar a confidence that really to that the think our of where feel is, sales the only deals coming capital year, are we being And of and And productive, gone we the Craig, still we year we the given see we of entered our achieve I the year. obviously any going number on X see And the about in degree such year. now dependent go pipeline just think had see left that of the better see all the to to I come close of we were this same now in I in times just to I cycle, conviction unknown being we pipeline Yes, I was folks these an second have we our XX% suggests half year. the mean, in lengthening funnel, and than of your productive mean, we and we first point the so too don't the our back capital those sales at

So I think confidence more today enter those us of XXXX. all when give things than we

Operator

[Operator next from question Jennings Our Instructions] Joshua TD come will of Cowen.

Joshua Jennings

you on Congratulations XX% strong had Kevin. And mean, million another revenue as for growth we how and guidance. Street's some and us I drivers XXXX, not growth, Reza think on you're key up plus models just strong question, could just key to XXXX? you of the I probably some wanted of north follow hoping thinking about be of I and revenue should we're our quarter. know I $XXX Craig's forecast updating take I just drivers about XXXX. in thinking was through of issuing those thinking

Reza Zadno

our These No, board We very and have or demonstrated combination the remarks, metric with business profitability. XX%, United providing moving down also is summarized mention utilization, ramp, are the control cost feel the as direction. financing, going we of saw also these a on I'm we take pipeline, whether increased my coming in on every in forward therapy and this robot prepared very balance but good want this not the patients. strong recent prudent that we still utilization tailwinds guidance, the I financial will right are in that about us among strengthened to it's placement. early sheet, to to I a access the

to that all those -- gives us XXXX. Kevin, going these do So to are confidence you want parameters

Kevin Waters

base, so don't We we I shifts we Josh, I XXXX. through our the we're I and that Yes, roughly and guiding business management measure the as obviously at terribly mean, equivalent disposables referenced, expected aware mean, the driver installed today. company, simple. point you look if the of used of at is in see even company And to heavily you a which what though you those would two, capital XXXX, not in grow to the I point in drivers what change one.Point QX it's a that specifically that's weighted there, a is as utilization, 'XX, is we're suggest expectations. proof that utilization capital do right. more fairly a think obviously to as team as we're Street of ahead expectations where business what sell that is are And

very the utilization.And which XX% would productivity, to exit think, ability capital reps we reps, our And the number one back expect we point the Reza's XXXX. then directly we in our ] sell returns and number what to point XX% therefore that's if probably as we're reps. two, But we're still capital to we penetration capital going mean, average of could of have you I So kind range the capital that have on we comment, a are yourself diminishing that is system don't you believe and to [ to into in math year take correlated look of just field like do productive. the early to close for

answering question as business rates med mentioned, to device far continue not the Reza are but your that appreciate companies. this business allow we're the to say, in I'd grow most directly at, on XXXX, drivers I other So to place of growth exceed

Joshua Jennings

follow-up. And a just

in Aquablation the or HoLEP the those really system standard that States. being at prostatic and feel to-date wanted the those ask mirrors just deeply of AquaBeam in hoping about for centers, there approach hear United of are displaced. rate I accounts, [ based, of just replacement HoLEP, to what's resective I being really the technology ] just becoming treatment guess, I TURP, broad a also conversion GreenLight, and -- seeing either bucket, surgeons was and get approaches. you're penetrating that Are is and a adopted low hanging centers at those to there As fruit care

Reza Zadno

that from you are have ask our surgeons and ask what and use, the could TURP the you TURP cases technology, the you TURP didn't we use when ones definitely are else of because if data the use for And are -- skill. treatment. prostate. we as product surgeon advantage it physicians therapy I to dependent shorter largest far also our other still that pre-effective time, therapies was the majority larger this from not larger GreenLight, GreenLight that's definitely, the The our recovery as them prostates, compared and faster we question So again and much the on mean, is

are advantage definitely prostrate, areas. for is these in So larger the we those have

Kevin Waters

of specialized. don't would would highly procedure, ability a to think It's I procedure, to I'd maybe the to I add it's And question that about the that. of on difficult of become HoLEP if surgical look market, something mean, the market, that specific And the at slightly also long resective of care less very it's HoLEP just resective you anybody your have the time. Josh, reality over HoLEP. XX% perform. is suggest standard

not HoLEP getting mentioned, the say, is we're Reza but there's loyalists primarily TURP on our some as So it I'm cannibalizing is GreenLight. HoLEP growth would and cases, term. many in and near dependent I sure also,

Operator

Our next Sandler. with question from come O'Brien Piper will Matthew

Matthew O'Brien

a off because going I'll trying refrain is joke on smoke but fire, -- about the business to alarm from your make

Reza Zadno

appreciate We it.

We're First was good. new facility it interesting. call in but the here,

Matthew O'Brien

utilization for goes just curious I'm existing utilization the systems. up we're the a far on as side, because, step the there performance expecting pretty again, QX, about as in big So

slow sequentially X% a typically quarter. in grew You what's seasonally

baking of And just the what kind talk for average. QX some question you of kind in momentum seeing? specifically? of some at cohorts, United month using you And are XX while you're that for again, of the then per the across a cases been people benefit on you the about have can So, in Craig's

Kevin Waters

as account So, not mean, our quarter, all by regarding are in really north in I need quarter. means, you cohorts, our at that QX guidance doing that [ implies at right? so And to systems of to. in of have that ability well per point definition, us utilization level. fourth corporate it fourth out, comes when just of in X.XX X.X. from is -- is We the procedure. did the to quarter, last to kind to pointed is QX the the XXXX suggest the in very that down XXXX growth previous is utilization that year accounts giving as month that in be what in fourth it many we historical your that's the think purchase did And cases, our achieve of all comfortable Then questions Difficulty] I than north per be the 'XX metric that X.X quarter, also guidance about increase seasonal look existing expand ], X% do procedures been in some that normal prior in of in in to with expect around utilization comfort expanding are we fourth in QX And an do X.X. accounts And today in you that what of 'XX, guess that any around would well. sequential sequential to our procedures, more experienced growth. And the we comparable surgeons BPH elective quarter. they what utilization do QX to our expanding tailwinds they our growth last procedures X% fourth the I about to quarter.I'd point [Technical as in utilization, kind with how are we comparable XXXX very which It's we're

installed in utilization the multitude fourth expand a a even to we expanding comfortable quarter. base it's us greatly continue with could of that factors that get So,

Matthew O'Brien

you. And then, Kevin, another for one

it of not Just just things, the been a cash happened of also side quite more little an gross on. that's on burn world, there. But love then know the the to down margin margins like bit, I area the investors have hear end bit. down a just came focused what looks

of levers margin some of side things? operating So you're burn cash and just things can that the on, the on the talk of you about pulling side

Kevin Waters

capital sequentially Yes, overall contributor The around so being our margins. down margins that -- had is you really our expectations. margins, I'll address both, If down pointed translated pricing XX% quarter-to-quarter would ASPs the as XXX rebounding of would pricing they back impact on similar so system the calls, to do variability for impact we to system the main said out, But gross previous sequentially. and and fact, have which of the to basis gross we QX. QX, first points been were we margin higher, versus our gross XXX on have in But margins, see expect on as that roughly actually in we've continually XX%.

out, higher. our company did that kind as now levels a facility, costs a do think into won't therefore the point in future. relatively while new temporary marginally And also impact this produce quarter. we situation.I'd we pricing, of were we average to we're to good. as our third production historical volumes fewer we the as that's But So units not return margins more feel fully negatively expect in But material and

a environment team. on and OpEx always cash having believe prudent the understand and this this feel, our in commercial in OpEx particularly the we is million that demonstrate saw third QX. bottom we're the in purposeful feel QX, that million the time Although but $XX we're I'm And you I on raise.We our significantly up to line the glad at we can quarter. the $XX by in quarter. going right question, out, need in And company, point, previous and below as given over important. guidance top our as to $XX suggests operating second to in a particularly and recent from variability, same grow flat quarters. with leverage being the to over the in This in flow investing pathway continue definitely the pointed cash We're quarter trend is third that's number the we profitability equity important. improved But the line. And that that what was, in investors It's appreciate discipline this operating we term, is our there's in that we with you drop asked, And But margins.Your million gross did expenses. show an investing quarter-to-quarter X you long we the cash. relatively with that's time, on environment, business, we're fourth

Operator

[Operator of question Instructions] Our Truist come will Securities. Richard next from Newitter

Richard Newitter

quarter. the on Congrats

Just couple me. for

think, the XX. I you north X In I thumb is rule X into target to systems I rep of for XX just to of getting that right be that with you're per if capital kind broad productivity heading reps. to Kevin the next past, about mentioned, you mean, year think said You your of strokes? thinking

Kevin Waters

ballpark. remind Yes, rep that broad would we've X a average good But to of to get the take that on I productivity, strokes you believe is thumb. to X that we productivity rule that it does Correct. months. said to is a

Richard Newitter

I just you was they you those percent how, entering two, pricing? can total percent where as at the all Do percentage orders? result exiting impact of and and either at those any in between are ASPs IDN, delineated Can of anything IDN where expect one, orders is XXX,XXX? you -- that terms and does then of if there XQ reflect a the said And the the kind that exit on you the you've then give you're those orders or the us or you of know at level all, XXXX, contracting range IDN Okay. the And orders terms on and/or in maybe what -- multi-system at do highest fall you of comment. comment And of -- past XXX,XXX of talk do year about percentages? IDN can be you in that that as to

Kevin Waters

start Let pricing. me with

negatively. relationships ASPs not IDN our do So our system impact

system quarter-to-quarter with with IDNs, IDN start question around start affiliated that. deals, broader with a IDN to your is variability reflection just on of To pricing that hospitals. I'll just I'll we continue do one. So The partner so not

and all on we is to have end we're think frankly proud the here. mentioned, team something the believe by track of IDNs a sell great under contract of I large we're majority business any different. I of we've the it's said, to for a as stage at not capital do other really which testament And from commercialization our we're you're As that hearing companies XXXX, management technology.With of just a that think

this not guidance, partners in QX. dependent improvement And our in from any it's We large buys bulk on seeing are environment IDN not in XXXX. our

get while XXXX. to pushed any going work bulk X a first bulk and our I as the type we opposed think current under XXXX negotiating for we daily. future on of our had twosies hospitals something but capital tailwind or said able sales on into any a large be buys.So of when large think dependent XXXX, none I It's to weren't in individual IDN I their the this buys, bulk working thinking, entered months year, continue to possibility onesies view in as And process we were we're if RFP our half we just think first and buys. kind we to relationships to those relationship because are year, anything, in without we few those but us really of the with we the on deepening been expectations meet

Operator

question The of will come Vazquez next Blair. Chatterji Riley. next from will Instructions] Our Brandon question from Instructions] Neil B. of come [Operator [Operator William

Brandon Vazquez

and a a little bit quick plans. question maybe One, clarification about future

the you discussed around to for expansion XXXX 'XX. you hire you further rep think capital as for mentioned somewhere go cohort cohort year to I updated thoughts on there's hire 'XX? room had are And able you you year, look to up you you where today? between in this XX. you with shore then or XX into as the a you we before I side, Are exit On next that us year Do do that? think to look that as Any just

Kevin Waters

to we we're cadence, We're to to be. want in be -- where probably about to halfway, regards fair,

in exact So coming X the in suggest in going plan the same number isn't at that think next they XX X out time, stop. call another of the I'd sitting months. in around here we're also a which capital I But we're think have XXXX, position today, here to folks to add. don't means probably to the of

business hire. at I key investing continue to at going not not to moving making account we're and But the into We're in a accounts, messier, As business. little methodical like we looking get accounts. responsibly, reps more we're fast, about in we organization. strategic to speak, managers. being making so it's sure capital not to think becomes We're complicated gets relationships.So it looking We're things more we just be the looking at IDN still how want sure too to we're sure plan that sacrificing invest make to we outcomes, But XXXX. people we definitely add very

Brandon Vazquez

guys a then in the nice I U.K. had internationally, And you couple have wins, especially of mean,

step You've are? accelerate? investments little talk have reimbursement endorsements. through can what mentioned those investments U.K. that mean, Can I that good there, have 'XX. When you you bit you the in might about up you

an a You're opportunity high there be making Is or seeing can't of we're as high any some of investments. a U.S.? area U.K. reason that that growth growth in area

Reza Zadno

have pleased Definitely another with from very we international. are we quarter solid

always strategy and awareness. been international increase with has working development Our KOLs and market to

arrangement mentioned, driver As in and you recent for our the catalyst by announcement a great is product having this U.K.

that, -- For U.S., in more Kevin increase international, staying are be will I definitely on action our immediate infrastructure But in increasing Japan will we and U.K., infrastructure. U.K. know sales focused, don't our

Kevin Waters

believe Reza's comments the I'd add investing is, business. commentary kind more OpEx in I change U.K. the don't the to our The point of going of only leverage to is around

investing absorbed of run from OpEx materially incremental it we're anything U.K., the if the you're standpoint. the think as be it I but into will in company an rate to thinking opposed about So

Reza Zadno

opportunity, point I KOL endorsement as we those very and a a We but market. of an sure we great in targeting methodically mean is see the place. and making international from awareness are international, moving view, we are and great opportunity geographies have that

Operator

come question Neil come Chatterji Instructions] from will Nathan The Wells Fargo. Treybeck [Operator next B. Riley. of Next question from will of

Nathan Treybeck

touch will variability I just sequentially QX down in I quarter. kind and generally, through -- QX were drivers great can the on there ASP you stable think of be the system on then wanted of just QX. Congrats ASP quarter-over-quarter? expectations that

you just could the on driving what's if variability? maybe So touch

Kevin Waters

So is means to sooner. look, or that that have are we on our we but previous I And mission see XXX. quarter ASPs know do willing to internal going business But market so negotiate do XXX seasonality, be, get drive to If overall we we've and at see pricing. as pricing.And can hospital gain in we if from we And calls, speak, talked have same would in capital on and system And at customers, negotiate volume, appears system you saw kind our on about procedure systems be start mentioned QX think time, not to ASPs. with in some look capital. have the and also to our it surgeon we we roughly share. we to out lot QX. seen at QX appear us sold, XXX of this now willing limits a in you partner I a will we the increase where going we are weaker in to we've on to of funnel But to when committed And a that growth a range. be QX, say, QX, in the to an pointed only

But variability. always hospital quarter-to-quarter think of make how just care so in an I make hospital. on center, that we're in bigger to ability decision price, speak. of fair and each our pricing be its trade-off and do team, the our a kind with opportunity our can have, the negotiations get as when of fair to for But willing going Aquablation don't any to a So system. price it's become some we a long-term light management concerns the that's about a individual there's at to time, and margin And we capital fast same standard

Nathan Treybeck

QX you guess outlook talk about U.S., terms into Can Okay. I then quarter-over-quarter. down what and then just pretty meaningfully sales your outside of were just XXXX. the maybe this? for they drove And in system And

Kevin Waters

than It's QX the is in U.S., timing, volumes, mean, the on look capital when good what mean, QX, we based with -- not capital the to think even very in relatively you overseas pipeline, pronounced these timing had I robust we think in at And few see I talked other we at we're some expect that frankly, did But we Nathan, seasonality quite had the where internationally. of factor. honest, QX as rebound than in in units customers, right? about into pipeline. funnel and But utilization we a would on I to QX, more European see seasonal be strong anything reading well, if you've capital, a I we even particularly see

Operator

Instructions] from of Partners. [Operator will Mike Our next Leerink question come Kratky

Michael Kratky

for could be on cancer? little thinking just provide patients. effective an of treatment the overall next about a are that option How more you Can for your in level opportunity? steps confidence market And Aquablation you of that, that color prostate size

Reza Zadno

very we is this again, our us in the And made mentioned, But have us the for is FDA great results this can makes because great the sitting We're this we could same be early. the cancer But have early. very gathered very for on to sense opportunity, the indication. is millions our as cancer opportunity. are trial And data it in that procedure early. segment. men similar of treatment, same the started we enter opportunity KOLs very This beginning to company, next the sidelines. is same show on a and this It the of asking from very the if perfect considering excited procedure, anatomy, this for this about we of And as the sense some study, reason surgeon. a

Kevin Waters

as over lot the to forward in spend, progress, get the project X to of of on nice is keep purely the of which our a This currently PROCEPT next And even material I'm X R&D this going and you is years, didn't focus think but any resources and our though doesn't a to ask, BPH. is move effort our add, clinical for we I to XX% organization's opportunity R&D increases the group. require beauty indication make

So excited we're it. about really

Operator

our Reza turn will CEO, now I to the call. the remarks. for to closing the conference would end on This Zadno back session you. like Thank Q&A

Reza Zadno

a future nice attending day. call. the for and We forward Have seeing earnings our very in to you you you speaking conferences. Thank with look

Operator

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

may pleasant You have disconnect, day. and now a

PROCEPT BioRobotics (PRCT) 1 Nov 232023 Q3 Earnings call transcript