PRCT - Earnings call transcript Q3 2024 | PROCEPT BioRobotics Corporation

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Operator

Good morning, and welcome to PROCEPT BioRobotics Third Quarter 2024 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 of Investor Relations for introductory comments.

Matthew Bacso

Good morning, and thank you for joining PROCEPT BioRobotics Third Quarter 2024 Earnings Conference Call. Presenting on today's call are Reza Zadno, Chief Executive Officer; Kevin Waters, Chief Financial Officer; and Sham Shiblaq, Chief Commercial Officer.

as like call listeners plans, of that performance, forward-looking I'd on statements events XXXX. begin, Private are conference the this relate statements we to Reform that remind made or Securities Before Litigation under Act defined to future All are and statements forward-looking on management's these expectations current based beliefs. cause to on materially differ from expectations expressed subject several assumptions are to and statements uncertainties, other results and conference call. this These risks factors that could the

no PROCEPT are are these These to with statements events in www.sec.gov. that which disclosed BioRobotics' risks in Commission, information, today's Except which October speak unanticipated required XXXX. to filings reliance forward-looking circumstances Securities detail as or of or arise. XX, Listeners date, uncertainties available Exchange and of on revise any and place undue not to reflect the obligation more at update statements, are BioRobotics new all forward-looking cautioned online by only undertakes may as law, PROCEPT

will release. we non-GAAP financial financial GAAP. reconciliations how in GAAP these use call, equivalent in their measures we to More as earnings information are the well with measures prepared not also our of measures as accordance During nearest are about that certain these included reference

With Reza. turn call that, I'll over to the

Reza Zadno

morning, for Good and joining you thank us.

opening the Robotic HYDROS For update, today's provide Systems will of overview call, commercial I general comments business the who and an will followed by provide launch. Sham,

and financial will XXXX Kevin Lastly, performance updated additional our regarding detail guidance. provide

with revenue Starting our quarterly results.

of of We period. to our of robotic base to the our third strong increased quarter Growth for the third a exited quarter systems, record and prior of average third driven revenues. We international XXXX. expanded representing $XX.X year representing U.S. XXXX of in the selling financial U.S. revenue XX% higher XX% the from of installed demand was to total quarter are strong quarter compared pleased compared by of installed the XXX with growth base and XXXX prices report growth utilization for performance quarter system another of with million,

following PROCEPT our substantial quarter growth represent our in representatives account the the HYDROS training of exceeded for field temporary challenges system. we base that We launching the on new removal given proud going robotic our third utilization HYDROS team system to expectations sales we collective sales the their Additionally, announcement our company quarter unique incredibly for per efforts. began was the we team but our a as installed entire through of the and midway from I'm knew U.S. quarter the for were despite

successfully XX.X%, commercial we during pressure on quarter, training pipeline this manufactures third gross the During procedures sufficient manage converted began margins record reported the of while teams mitigating of field-based transition. the effectively our capital market downside and product quantities

team's we strong delivered result, a the As reflects quarter and a steady that dedication commercial execution. very

momentum in generated Turning to was the of XXXX, million quarter to in the Kingdom. compared the year in international market development primarily revenue once representing activities. by third strong growth driven international $X.X XX% third We sales Growth again quarter prior of period. of United the

Our international we further giving increase pipeline as us continues nicely confidence to enter XXXX.

will I launch. to HYDROS that, on detail With our the to provide call over more turn Sham

Sham Shiblaq

Reza. Thanks,

quarter of the to the part exceptional every comments and reiterate team's performance flawless a want I Reza's First, execution from on in required dedication organization. that

quarter. in transition encouraging. from outstanding the and sales AquaBeam to a the an pipeline we benefits focus to very HYDROS. excitement system Awareness capital Initial for spread which smooth and of immediate shifted Once FDA received team the their favor educating in certainly quickly, on launch played the converting our to Turning customers HYDROS capital allowing the and hospitals around the feedback into and surgeons resulted immediately clearance HYDROS is mid-August, launch fairly itself.

surgeons design, sleek and AI integrated the fully feature. impressed were first HYDROS's with very from assist new Aside

As a our their to and AI treatment for both landmarks to enable an very the interpreting improve all key reminder, has reception plan patients. ultrasound outcomes optimal and urologists image administrators. and precise assist appealing robotic-assisted surgeons potential supports anatomical of surgeon The This to suggest to addition live the the for AI first is each patient. for

facilitates Other setup, feedback and turnover. stage procedure, staff workflow from we received, how and single procedural footprint with integrated Aquablation operating hospital at support surgeon improved therapy is interface, staff the the experiences specifically every the a particularly and efficient power operating improved room user of

scope scope utilizes were CFOs saves piece eliminates hospital and see [ and for single-use time the streamline to digital that need happy which money. further the a processing that stand ] Additionally, new HYDROS setup,

good third seeing the very quarter behind us, average feel particularly are selling trends customer underlying high sentiment. about demand we phase we and and dose With the today, prices, around the user launch system initial

of which has team, translated where a number sales HYDROS Additionally, energized capital certainly XXXX. new we of quarter the in robust sell systems has the fourth record into expect to a pipeline

on briefly Speaking trends. utilization

the respective sales As reminder, began period time. of training in which HYDROS a to territories a September. team for sessions sessions on quarter, continue will training fourth throughout plan reps remove the We system we from their

dynamic, this this to Given the modestly case will reduced due volumes impact coverage.

into critical to transition communicated as and commercial success our we mid-August, teams in properly our As sales training XXXX. procedural we is

system time. much in is bigger a pleased realized both ahead the expanded with and team's third robot execution for quarter, utilization there sales While the opportunity we over

enter believe significant will As widespread milestone profound driving growth, I our difference the journey, in of this and be making lives commercial we our adoption a a the phase launch our patients. in next of

over to the turn will I that, back Reza. With call

Reza Zadno

Thanks, Sham.

our it prostate study discuss technologies breakthrough and with X, improve cancer the granted clinical life-threatening cancer. Aquablation prostate review lives pass irreversibly the we announced that Aquablation pivotal announcement to randomized designation therapy particularly investigational can prostatectomy. of the radical over that a FDA or of of exemption conditions. is considers for expedites as therapy debilitating people device process innovative new want trial Receiving investigate or our On clinical and for it device the designation to to breakthrough to I initiate October diseases I comparing device use FDA recent to approved exciting the that Before Kevin,

The to cancer. in of at which This co-primary morbidity, FDA prostate patients will known prospective enroll to PCA compared efficacy we X-month be clinical incontinence States. based most assessing radical therapy localized multicenter in dysfunction. on centers, a randomized The study the specifically, to XXX safety men X to of the trial of will is study Aquablation up rates prostatectomy up agreed as is great erectile and X to WATER are global endpoint a and XX the IV group with enrolling United

agreed secondary endpoint efficacy rate the XX-month of include great group Additionally, to measuring a progression. the FDA

related potential sponsor comparing prostate If of IDE successful, be we to using followed way will WATER with evaluation, and Patients a both an as focusing therapy reduction To treatment prostate Aquablation localized of therapy in alter to approach is in clinical endpoint to on a the years for standard the a annual to up men. millions PCA cancer IV significantly harm comparison believe ever to radical a reduction events. date, to focus trial when oncological cancer novel first-line care. the harm treatment unique design Aquablation trial secondary will has XX for on that treatment randomized urologists localized only prostatectomy. company receive a is the PROCEPT

step treatment outcomes believe big cancer, opportunity radical men for The indication, exists of localized to quality is to we the randomized in ability and for a prostate Aquablation the first-line therapy has prostatectomy and against safety significant first other life cancer. Initiating treatment become treatment needing no prostate a a a cancer-specific for improve has prostate trial today. which pursuing

Lastly, in strategy. over plan X cancer broader XX next of likely Las more XXXX Vegas. details Urological Furthermore, prostate enrollment to the regarding we XX PRCTXXX data September to Conference in April completed we our and in months Association American the months, commercial at will share share follow-up

to allowing our To start, conclude summary, off launch the us multiple trend execute continue prepared my a customers plan. improved to HYDROS to the and thrilled great In are is positively, with factors strategic features. U.S. long-term remarks,

of that continued at trending Our pipeline than grow selling system. previous nicely are higher our prices HYDROS to sales AquaBeam and average funnel

business momentum international build and Japan. U.K. to Our in continues the

history, most to the lead is organization largest company's will believe the we commercial productivity. Our and which increased tenured in

first receive a to prostate approval randomized IDE against for the from to radical We enroll the FDA are ever prostatectomy trial company cancer. the

that a business no to technology We've gross which margins has that used have continued cancer-specific of around care this neurology believe the as foundation BPH profitability And the the we lastly, prostate other global leading first surgical and will become big indication, fundamentals treatment these step metrics with pursuing is expansion the be underlying in We a laying our company. throughout standard exceed reflect the XXXX. guidance of the primarily today. to

over to call And will with I the turn that, Kevin.

Kevin Waters

Total XX% compared quarter was quarter quarter growth robotic growth million to million, of sold these of XX systems, approximately XX% with In the blended the to was Thanks, systems we the $XX.X XX representing XXXX representing were quarter, $XXX,XXX. year XX% compared for Reza. selling for the approximately XXXX. third of the prior revenue third $XX.X of U.S. Of average prices third HYDROS. revenue of period.

XX a were in few sales did accounts. existing we are the second HYDROS primarily accounts, included systems Our at although sales systems have greenfield that

this view the is Additionally, in do HYDROS system for third few these exchanged previous AquaBeam who $XXX,XXX in executed system recently revenue AquaBeam approximately that a limited we true We were offering replacements customers recorded purchased sales as quarters system. of not our as incremental a for for quarter.

of number these growth To of generated XXXX. When system the compared revenue million, the an did compared representing systems. increase in XX% base total not $XX.X was XXXX sold XXXX. robotic the of not to XX% and third third driven installed variables, to quarter all systems system impact reported exchange quarter these third of quarter the we by in consumable included the revenue of and are the of base. handpiece thus, for was systems U.S. $XX.X accounting million, Handpiece for representing growth be clear, XX of U.S. of revenue growth installed of

X% per of utilization Additionally, XXXX. monthly approximately the compared third to quarter increased account

growth the quarter, U.S. compared approximately in of to shipped X,XXX of handpieces We quarter the representing XXXX. third the XX% in third unit

prices were selling average approximately quarter $X,XXX. Third

We of all-time XX.X%, in approximately for $X.X $X.X also quarter XXX%. third quarter Gross of quarter high. the million, recorded margin growth an revenue the International other third representing approximately representing was third consumable of XXXX. was XXXX the million revenue for of

primarily full operations is costs selling Gross expect was costly It manufacturing following we Over margin scale, our third a our important than more to quarter system it down. material high-growth expansion team the due HYDROS roughly with execution that to higher time, system, to of and XX% note today. strong is significantly AquaBeam quarter in prices. average from new come

by more offset headwind is increased being selling than this prices. average However,

increased to compared the million down $XX.X year same Moving to million the second development income prior of sales operating of million and XXXX. and The the in sequential offset second significant third were general mostly expenses high organization driven XXXX development Total research commercial the following increased $XX.X was primarily the in the year-over-year of of expand and and by in expenses statement. in by growth quarter around and the administrative effort the quarter $XX.X lower increase marketing expenses, quarter XXXX. period expenses

have expense are year-to-date. we We leverage very operating pleased with the demonstrated

to the loss When XX% growth the XXXX million of compared comparing of prior operating months period quarter $XX EBITDA of in to third quarter X increased loss in was a expense $XX.X a was in the operating year. expense XX% Net $XX.X Adjusted compared of million of of growth. $XX.X growth, for XXXX. on million the the million to revenues third same revenue loss XXXX first

Our as quarter September we equivalents and of the million, $XXX a cash of XX million. balances cash cash, reported and cash restricted usage $XX.X in were

XX% XXXX. financial XXXX growth of XXXX in to XX% our guidance. Starting U.S. to total range approximately $XXX.X expect million $XXX to year to of million, systems. with Moving full the revenue to now We be representing compared

to sell in XXX robotic new expect XXXX, XX continue is We systems the which to systems approximately fourth approximately in quarter.

through pipeline. quarter, be the pricing launch system While Thus, our this flexibility want the fourth new work to guidance as pleased quarter updated point new pricing of with in maintain assumes at direction the HYDROS quarter system of $XXX,XXX third we in range $XXX,XXX. pricing the fourth in the our in to we to

handpieces. U.S. to Turning

approximately growth to XX% XX,XXX sell handpieces the which quarter, would unit approximately equate fourth full year to of expect We in handpieces compared representing X,XXX XXXX. to

to expect We comparable prices the selling quarter third handpiece fourth quarter. average

other the expect also $X.X be million approximately revenue for year. consumables We to full

service U.S. $XX for expect Additionally, million we full now be approximately year. revenue to the

representing international quarter annual be international of momentum growth Kingdom the revenue, million, on we strong given XX%. Lastly, and another expect now full United positive $XX.X revenue approximately in to year

now We of full issued statement. guidance year our XX%. be expect the from down XX%, an to XXXX approximately Moving income gross previously margins increase

operating expenses. to Turning

representing expect approximately to full XX%. $XXX.X operating growth be expenses to We million, of year XXXX continue

in Given current expect interest interest of generate net rates, million income to XXXX. $X.X we

with $XX February. million, increase and increase of on expect we the revenue guidance view our full in million EBITDA loss Given now expenses, adjusted gross be approximately XXXX operating year our margin, in which $XX along almost is provided an from to continued initial

I'd closing Reza comments. point, to back to for this like At the turn call

Reza Zadno

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

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

Operator

coming of question of from line Securities. first Now with Instructions] America the Craig Bank Bijou [Operator

Craig Bijou

another HYDROS. start on strong want very I quarter. with Congrats to

just then pretty the like HYDROS. that HYDROS ability or a if see bit And was more of your kind back maybe I you're been customers start. XXX,XXX. you comments So the give ASP get ASP, little sounds with it we to the how conservative And But to have you hesitant there? in think is the new about the come price numbers, wanting I reaction, somewhere you the to or before? seems get guess, now like But on did understand should it on around your specifically, Kevin, color may more could into be, if purchase either strong. reluctant customer pipeline It

Reza Zadno

reaction the give and for are time setup. about screen, digital faster excited I'm about excited going been sterilization. scope, extremely course, saves digital staff has about some hospital to The general positive. of And HYDROS. comments Surgeons ease-of-setup is assist, AI the the the

do anything? So been Sham, you fantastic. add overall, the to has want reaction

Sham Shiblaq

with customers that are surgeons showed the happen. that a make results. a our excitement of administrators capital hospital's just the our from required purchase drive positive our for ability in many immediate in us over I flip think month pipeline reaction to by to The a to perspective that processes shows to

something routinely excited you is surgical So assist nowadays on AI, the about this features. we're that touch first in that think approved not environment. very the When gets a is by something

ease the launch of the really, down these the we're enter the excitement. we've use just so capture to able procedure, And been We're from really the staff, programs a take in OR. of lot excitement to seeing and setup, The from that beginning efficiencies immediate our surgeons.

Kevin Waters

just And Craig. loop ASP on close may I the help your HYDROS question,

pleased is feel good quarter going, we to very that HYDROS the we're are We range we XXX there, in possible. about but quarter XXX. what to which hands hands in Today, current feel number want the flexibility we continue we HYDROS specifically the to saw So why end definitely to ASPs. as the see maintain on not of fourth going day, AquaBeam -- about customer's can of At of comment previous And just this we launch. sales. the with want where kind to as we good given some the we many compared ASPs provided

Craig Bijou

I But if to you -- And be think pretty I did quarter. know in correct year-over-year. even I'm you but strong know ask color on maybe I you're impact if lower if into be step and that and correct. on But know and think little maybe bit QX? if to -- utilization, then during want that's impact the that then think higher if Kevin, when to 'XX that utilization would leads had I might me at or you'd or wrong, in seeing. implied me a more QX if all? be willing utilization a down I quantify Just let about the And if disruption QX, don't that

Kevin Waters

Yes.

Let to those some I'll end dynamics. address it me off here I'll start QX, of with at QX, hand about then and Sham and talk to the

a September dollarize the even quarter, specifically can't the impact what third of will of So reps coming out say was we procedures the field. field. definitely is in the I we move saw our out But reps of strong with taking we what quarter throughout in that

felt headwind, definitely the [ it And now transitioning, us. our strong environment for So strong out the gain September as say first other business do continues to receptive fourth there. quarter procedures procedure results really was believe and ] a that into from we XXXX but itself that head all in I'll reflect very a we underlying momentum share

to your a on is that been guidance that we specifically, the a account we that with implied training be and dynamic fourth way, was that our at in have providing year. procedures. has end. about specifically, reps is have utilization that field the on utilization basis, would have quarter. the be suggest I'm little the the from by fair to a expect going for an continue But for same But in it which, one. QX do down, to impact the full going HYDROS to per been always removed does And year-over-year talk bit Sham

also, the of allow these in the around the guidance things incident for that does some hurricane October of factors Southeast. some about, we're macro all we Craig, particularly Our in hearing saw

maybe have close here. in macro those I'll guide it But factors all considered impacted to salient turn obviously of our the somewhat over are as We Sham by shortages. QX well. been And to

Sham Shiblaq

add on a about The X bit in is I past. part talked the training we've rep the I'll little guess as

approval our them over a ready their felt get HYDROS to and of team, PROCEPT we go. help customers So to convert purchases coming trained HYDROS, prepared as to off the prepared, fully

visibility have it. aspect and and staff ready to end. already then how process So get could We the the quickly could complete at how of surgeons for acquisition training didn't we customers quickly just were our

September in training November in our we're majority now launches. launches begin though become field December these what will process we for going and see to even is the that purchased did So HYDROS team, with QX of were our

So the launch. those trainings those surgeon that before rep in trainings and and not months the before they're trained to staff time so training, you the want launch,

quarter. So November the in we'll and those happening see really that about October here to launches to excited start other as for we're begin pick up

Operator

Our next Brandon Vazquez line William question coming Blair. from with the

Brandon Vazquez

many disclose you sales the different. get how here. the already reps start the of waiting go I'll here. trained that are better we the it QX? piggybacking of a and then for point back on left sense reps to Congrats keeping able that guys rep rep Or guys this perform are just you to to another been nice as lose train on what ask of percent Are your that into on they we when have with be is last so with pulled you trained question quarter to I'll maybe therapy? understanding getting come procedure a procedure slightly that that, And are at Aquablation? can

Sham Shiblaq

Sham. Brandon, it's take question. that I'll

So a of tell Many now scheduled the we're December not of going for you quarter. I percentage to are of majority happen comment vast launches them launches. will reps, fourth the in specific on will to but November and

So can impact the that I force coming of you of the of on do the out the sales field. think math kind

a the thing help that that's thorough with for patients and what very process. will great outcomes and the HYDROS surgeons We will our be and long be We day from going have the a launch, to well. we X as have happier good and great us ensure business our have very that right doing business to happier, term we're feel is

we're quarter. having are, cases practices on We the any out cases, get hospitals their we by having losing don't of rest procedures? leave further Are loss surgeons the the by taking -- of procedures in Regarding field. to put by go trained time believe I delaying

believe So proper them a we delaying sure great We're launch we're losing and to just outcomes. don't make cases. have we

Brandon Vazquez

TAM. systems terms contemplated really or And made maybe second analysis placing is Okay. quarter. this of you the I going of level the know not some market comments little guys had this unit original a guys in opportunity higher in something that about additional your you

and is your you just a it Any the second can guys the mean kind with update -- bit give talk you for unit that about second on kind accounts little what opportunity us might long-term of units that's driving of So here? what can where number systems? of

Kevin Waters

Yes.

and term here, near the long take I'll So term Brandon.

guidance just what QX to So our implies. specific and it

guiding we still greenfield have to driver a think in those of business So our systems, -- but the the XX biggest units handful of are quarter, of we primarily opportunities. fourth is that may less second today the of greenfield we're believe

Although kept see bought their in they've also quarter AquaBeam therefore, third that the And KOLs we system. second key a a system. bought They some system. HYDROS did

So the that's near term.

a to And our 'XX the is we It's the term for market still we greenfield. look of when new in primary of see definitely focused sales that when strategy But systems it's longer And to HYDROS replacement accounts. cycle, believe we is we we how we on, as compensated. there. the we're to think on force remainder huge mid-August, what sell penetrate is a demand communicated have

a it's next only this cycle, months really replacement probably in on XXXX talk will So about come to connection too in guidance our our with few early call. but -- a

Operator

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

Richard Newitter

because And cutoff a with XX third like the replacement purchase. true-up your or to were last their quarter, were did the last sort Kevin, kind Maybe recent had them potentially should what's the months enough ballpark? made what if they for for handful? was And that? how we timing you you on say in cutoff purchases out. of of the swap rolling allowed Are any purchase think a about Was deal enough recent the here, and/or associated they then on basis? thresholds eligible strategy quarter. purchased you trade-in some of aspect in the the for that Congrats how that just many trade-ins and there on there Or

I'll then that's question. And first So a my follow-up. have

Kevin Waters

Yes.

that cycle. So and it's forth important to I true a brought note, between exchanges there difference replacement is today these a

aware we AquaBeam installed X So purchased that been last system where perhaps hadn't think recently of even in in hadn't with always yet, were had account customers launched. launch, the been the quarters the connection our

allowing So revenue a exchanges address had was that those therefore, or a a that replacements. of hundred to we nominal for -- as place and were I mentioned opposed are my in thousand to And the contributed as compare couple to of those always dollars. those script program few amount in

that But could material cycle. of color but 'XX, be than that around a right but the not an will have mid-August, fourth as initiate with ago kind system. And X, HYDROS ASPs about those that initial gotten a persist shouldn't provide we greenfield thinking of today, in launch terribly we into a that wouldn't expect different I on quarter, X going ASPs. view past replacement X a purchased accounts. more for how to to And we we're aspect that or that Again, think those frankly, that years Rich, now we've are And going where of as we lot AquaBeam have do impact the into communicated we're replacement. accounts of the then get to of here said, many overall that we be

Sham Shiblaq

do we everything these a trade and to to now add Rich, remains right to get on a with can new that incentive such massive X we rest has that accounts sales hyper-focused The hospitals talking the are They're greenfield acquire the of opportunity hospitals. adding potential to thousands opportunities hospitals, going. is We're we about of only year I'll system. this we believe this ensure system. that a have thing up to new force

we'll on hyper trade XXXX, comment replacement. going focused But we're hospitals. for in the So and be new on to more launching now,

Richard Newitter

next side. 'XX to any additional the XX% I as have on you're north that you giving to which from right ASP, think the streams consequences going limit for if half adjust guess quarter numbers here, directionally? to fourth models think we takes, back sounds models system happen our all we should ASPs about today, the the Okay. That's you point have puts upside like and don't on revenue And flow-through know we think -- just -- not helpful. can off And particularly be something to of for street replacements but just what ASPs commentary the help If of with there revenue. particularly, information how guidance if even your through some take don't gate. jump us out to updated of to I year we it some system will get it comment about early are

Sham Shiblaq

Yes.

So receptivity you hit good nail we about our Rich, quarter 'XX about to market to that I'll prices. get to but on continue the head our very launch. going to robust good third through the we the really, that about do having the reiterate capture we've ability the not selling the we We feel feel just the very launch guidance, But nail that product want HYDROS average in ASPs quarter. this in first full down before commented, we're out around ASP. we and great comments our we feel give the of a XXXX But directionally, as saw

Operator

the with from line TD And our next question Josh coming Cowen. of Jennings

Joshua Jennings

recombinant quarter. and opportunity. BPH Congrats the prostate cancer about just localized very on strong to wanted ask another I

terms have hoping be some to your U.S., on intervened in cases seen prostate put -- to clearly, it's utilization year and have box, annually. those size also sort are our months on just in it's think over mean, could been warning cancer in -- number that in all upon then was then check where And of uptick update the maybe this understanding there's of the understand citations kind opportunity from I if fill I there any of that that the cancer just of I the currently, on cases of that just And over review was being that outlook need the I'm label. you help procedures. I the XXX,XXX prostate that was guys removed label, mean done X first you reimbursed. since are that

Reza Zadno

Thanks. Yes.

what yes, we the have cancer, with States Level with the is there men previously, really United are we data we study about so and about that there want cases. get our X million in as are And X prostate XXX,XXX So generate a said in accomplish clinical to new guidelines.

the our said we them million the With efficacy we effects prostate the goal future, goal then treatments. more majority And to is provide into market. Our one, show the safety current of of gather study, strategy. of randomized because in sidelines from our X out because market sit is the as those and of more the side information the can beginning to cancer, product of the on expand goal have color vast who we the expand our men and have commercialization

Sham Shiblaq

surgeon's to happening the reason it, with prove that other to their we patients. Josh, with BPH But in that so the using for prostate FDA show to there. treat feel of as confident years on the think patients effective that and removed of very BPH with I safety surgeries We years technologies, the also was meaning the to similar what's decision how know concomitant the localized a many prostate of specifically cancer, cancer. don't safety procedures. BPH been Aquablation safety contraindication is to our treating believe do that been that the patient has I have It's surgeons wanted that also for use receptive

have believe cancer local your that answer specifically, to answer life treating faces always have that that have felt we other an do BPH. cancer we have than don't So safe question surgeons patients

Joshua Jennings

was on call, outlook as any to and on updated hoping to we missed wanted have channel And program. I just the the the pilot may on hear I then XXXX? opportunity I think about an ASC -- And that update it

Sham Shiblaq

Yes.

X So as well. I'll take that

Right ASC patients pilot published, success the ability continue in X opportunity high data, to now, center program and as we an setting. there's that's a that we've the day Canada setting ASC of excited to success So of out great have same rates. showing lot very the get begun about through get with

XXXX a We have sites, been pilot. pilot going XXXX handful and expect kind has our the a deliberate. the in expand in of X sites think minutes I is again, U.S., a do We Once I that center in to few to very which what number of said limited back of that ago. to

that then for opportunity need years hyper-focused therapy. us be that. ASC hospitals expect we to accelerator to a an to still come. of thousands We in Aquablation acquire We'll have remain for the and on system

Operator

next the with Sandler. coming Matthew line question O'Brien our of from Piper And

Unknown Analyst

in start ] Samantha And to I'd later in is seeing a on in quarter. terms for the This churning this on competitive you are What of you share shift? great BPH. like Matt. dynamics are from with Congrats maybe [ QX? accelerate seeing

Reza Zadno

So coming. do on technologies a we new side, receptive not from the see competitive

they turb and light. when the are they And surgeons, do at doing what same doing them see cases question, than we we market had ago. number yes, the the a asking cases we is when come majority of more of expansion, were previously, are they or As to of years talk anecdotally, that green from vast say, majority said are time, the X the we performing year our

Unknown Analyst

next about could year Okay. any on And then in color I term? the you term, guess, wondering and second, our in the if expectations, both were models in longer we thinking also more then short provide profitability maybe

Kevin Waters

jumping ability in XX%. this while now really is guidance revenue to at Kevin. always off is demonstrated quite well in that a year company our to the really We've XXXX going our a what revenue results operating We're growth, here suggest our keeping the expansion dates, the same time, it are nice demonstrated that level to provide which a but gross specificity by quarter to at any And I pathway This control profitability. comes we've we've show very every flat. down raising that our over has kind expenses, said around clear expenses margin we with point of is operating a would we third quarter, record not think

in another improvement does at year Our suggest the XXXX, ending XX%. sequential guidance

business I on show the line think just point, it's a to matter that our that it's think investments we in has we'll this to for still be of and making revenue top growth, to time for prudent But outsized amounts. at profitability. business our continue grow focus a

specificity any around give to going dates. not we're therefore, So

Operator

coming line next question of from Nephron the Pasquale Our with Chris Research.

Christopher Pasquale

piece bit was getting decision actually a the for I Can sure radiation adoption term. prespecified that to to you fence initially know were about there IV component labeling think the here? talk just thought arms? the on of on and about something a the kind how X the balanced long the curious, is that that process WATER study is you Congrats is little you that, to treatment specific approved. make then broad And go between important to regimen just

Reza Zadno

Yes. Thanks.

So expand for FDA guidelines that with goal benefit the high market. the the important and mentioned, because and is you if have dysfunction. reduction into as is so X incidence was incontinence thought get an current study, successful, we that randomized the erectile patients process, treatments to Harm data to of generate Level a sees could clinical

dysfunction. end the months, to as the endpoint, is the course, on So statistically erectile point the significant have cancer. incontinence benefit primary defined as secondary progression and mentioned, the shows that to reduce and And of X we efficacy progression of is

is is how defined. efficacy So that

Sham Shiblaq

restate question radiation? Chris, can your you on

Christopher Pasquale

going there arms? be to sure that Just the sort make are radiation? curious, to patients an of X is there imbalance protocol And getting a between not these prespecified there's

Sham Shiblaq

patients. that with we're patients specific options localized Yes, you and about obviously for that moving this obviously, patients. when We're different a definitive disease radiation other prostatectomy or study a either looking looking randomized so many component, cancer, it's prostate for radiation prostatectomy a Aquablation is at surgery which at prostatectomy to the think be would times to Aquablation

Christopher Pasquale

Okay.

] comprised delayed you comments and like Aquablation itself not what going in saline procedures wanted So they're the hurricanes of And utilization the then seen procedure? is And sailing? fluid you radiation. the that? to and waterjet And impact [ typical you Have a to shortage the just looks are guys the us of because there. getting can any just of remind clinical-grade with around be the seeing clarify

Reza Zadno

So from the use in [indiscernible]. saline of fact, procedure, uses saline during quantity saline than the a less of quantity procedure used, our

hasn't I know, not the So [indiscernible]. I on broadly, has add? accounts, more to yes, it's of some want And But the selling, -- don't no. impact, impacted. but than there depending mentioned on quantity it as been doesn't broadly it Kevin, do you

Kevin Waters

No. Yes.

Just regarding canceled see procedures October. our in guidance, specifically, did guidance we

the doesn't a trajectory our get feel very hundreds, is good the think that environment to obviously, it suggests with worst from very behind we, strong about to the somewhat a September for And right? weather thousands, You assume guidance would could persist coming particular, underlying of think worse, guidance into the does procedure kind the in in and business off also it that we're allow continue I how standpoint. with us, quantify in saline our of saline But current October. helps again, November, that if about the but shortage. the not thinking

Operator

And next coming Ryan question with our of from BTIG. line Zimmerman the

Ryan Zimmerman

Congrats from quarter. the in some the to on reimbursement. number urologists related dynamics of Want been comments field about up we've to a ask, picking

been the about with this audits, think about pushback as but I clawbacks as for more risk covering what there's and cases I've things specifically Medicare on with Cigna as Barry auditors with some AquaBeam previously, such of spoken Humana they're well chatter RAC from and AquaBeam.

I'm speak just small. whether if it's to impactful, that's And wondering so whether you that, can

maybe put Just that you can. bed, if to

Reza Zadno

to started happy care restriction. remove despite common we as some are to last audit, see to in size been surgeons this specific working size that's health this FDA we us. is have was October in is say There done with there RAC restriction and a no XXXX with the to Medicare, know, I'm payers these the in FDA, these are But procedure you when audit way. in to able we that months. for by XX -- approval, execute restriction. related of It So and of about

It's have to something for is matter in with other that This growth. a time. we It there some Medicare that age of just that. remove is carriers resolve. an been not example, able, have were cases, For some restriction to our obstacle we

with are working them. We

Cigna as there means a carrier their September, was of basically, restriction. policy other as can retired what they In Cigna what is no mentioned, words, you when surgeon policy, far that mentioned that Aquablation. recommend a retires As is

definition that retirement. So of is

Kevin Waters

I'll add the a RAC little of audits Ryan. Medicare, bit on

Aquablation, patients on a of we treat RAC Medicare traditional audits outsized with that specifically to and due we the The patients Medicare. a specifically BPH get are demographic treated. has are So know getting focused of proportion

only being ability XXX market of of than And XX% currently less grams, to less is private market, to of patients major number range so when than limitation size Medicare the targets XXX think to payer restriction limitation expand treating. the you restriction the Medicare, XX% size which Also, impact a mentioned the grams. has Humana size minimal had our of our and you procedures achieve we're on have Humana. traditional of due then limit Medicare. This and Aquablation about utilization traditional the a XX% is with a are

at them, So restrictions when again, percentage don't XXX-gram we our a patients of have than of limitation. very look payers, other small once the Humana on and you we major is treat most

Ryan Zimmerman

I macro Very, seasonally, the with just, And appreciate solutions will, field if I in that up, year? quarter if philosophy, quarter ] step training. quarter-to-quarter fourth even similar you terms dynamics case, then particularly it some did Okay. Kevin, very of there's as of a why the the and last out follow maybe were helpful. kind mean, wouldn't for reps the fourth are guidance But of can systems in [ IV

Kevin Waters

It's systems, significantly. are XX I units we up a of and are number significant -- up so PROCEPT will guiding an incremental up to year, represent first. we compared Well, for all-time prior which compared mean XX I'll to is the third systems a address to margin. high by XX% quarter

our in I systems high previously all-time quarter think of XX%. number was any

has time ton installation, that a a platform launching it's new feel completely a what that make When utilization to few way. we it to install do we elongated right somewhat the that when of accounts times we around of from do this we think has systems. So think and dynamic, Sham important, these requires momentum the sure a I it referenced

which XXX be year that we systems XX% base to total roughly of in of almost we exited back as half the our guidance would close June. installed sell suggests And the the

here. procedures very care So us in best the going methodical but about be of that we're it's quarter? we moving feel we launch. for sacrifice become mean fourth the Does opportunity It to our forward to does standard to absolutely set up XXXX just the some

Operator

from line coming Leerink of question Kratky Partners. the next our with Mike And

Brett Gasaway

on the on there been what's going go bit that, we or AquaBeam be Obviously, that's another guide that Congrats be But thinking of just there's rollout. on in is dynamics and I a quarter about to to back little the This for on any ASP how if XQ. the should HYDROS XXXX? driving flexibility legacy into we thinking with a any if Brett successful should Mike. there's rollout. there's with discounting want persist great may about

Kevin Waters

don't I anything Yes. here. unusual see

implied our handful our of a existing of As systems QX greenfield are in sales sales to second the we've majority perhaps mentioned, accounts. guide, they and

we full initially. an for we to are it's again, I a And get launch exchanges sell expecting a there's full So ASPs. getting on trade-ins. or unusual just quarter we greenfield dynamics have through of where better regarding ASP on to quarter prior than HYDROS want to front think no too quarter XXXX the replacements, all primarily or the But These are accounts. guiding now in fourth aggressive

Brett Gasaway

at term? And side. point, level COGS on know guess, going thinking side, higher I profitability the time. about scale I there, But cadence, not follow-up a and just then should XX% overall, how should on over And versus that's on Understood. primarily how the base down this level. legacy we Obviously, of COGS be you're that kind AquaBeam about be we commenting just just the thinking but long to

Kevin Waters

costs. overall HYDROS would I ASP about did we over efficiencies manufacturing cost talk more a kind in the HYDROS to time, margins of mention, really And same. producing manufacturing we're in to time, investment the say, said, single and think cost the think was. in than and misinformation about lever the the offset in being I than biggest have XX% operational would over AquaBeam AquaBeam of greater expand scale. is lot is to of just out product gross to longer some, more the what clarify there With I'll And wanted continue going term. costing we period is we to AquaBeam. for comparable to do becomes community us much was I of that that more increase regarding a We August Maybe it more where HYDROS currently To with update Yes. less margins seeing general. that expect in do in

or on here. third Not we into commenting about the feel profile do not business I quarter very off we good our XXXX. at And margin now jumping our while and is that expand from head XX%, and for profitability seeing we're And as around a margins, should only we point a clear product but improve metrics quality, has a year pathway focusing things production, to talked business again, all us a we and like as in the ton last of these is that continue about yield, conviction scrap quarter fourth we're business that very give that to on profitability. a of this, think

Operator

further for final this I back will I'm the at turn to call questions time. over showing Reza comments. now queue the Zadno in no

Reza Zadno

you I you. Yes, I very happy, conferences, want you for of Thank of a day. to to thank all everyone at our the I upcoming good see wish hope many joining and earnings call. a

Operator

conference disconnect. our conclude today. does and you Thank now that gentlemen, and may for you participation, for Ladies your

PROCEPT BioRobotics (PRCT) 28 Oct 242024 Q3 Earnings call transcript