SKIN - Earnings call transcript Q1 2022 | The Beauty Health Company

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Operator

Good afternoon, and welcome to the Beauty Health First Quarter 2022 Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Eduardo Rodriguez, Senior Director of M&A and Investor Relations. Please go ahead.

Eduardo Rodriguez

everyone. afternoon, Good our joining discuss for which Health conference found Company's released Thank Company's the first to on be can the afternoon results, at quarter call beautyhealth.com. this you and Beauty website XXXX we financial is on that will investor available during Also an call. referenced this presentation website our be Liyuan today Company. Officer Financial of Beauty Health With call Stanleick, and Chief is me on Chief Woo, President Andrew the Executive Officer; and the

harbor you Before Management we underlying would I forward-looking the including may language. get safe statements, like to make of assumptions. Company's remind started, guidance and

Forward-looking statements results risks could are to based uncertainties actual involve on expectations cause and that differ materially. that

measures as over related comparable with the and I in EBITDA gross to call EBITDA the For SEC GAAP Stanleick, a Beauty of Health available call margin, margin. Company. non-GAAP This The adjusted risks non-GAAP these earnings to Reconciliation will business, on such see contain and the to the are of our measures adjusted website. SEC. our filings further President adjusted and to release will turn discussion of furnished CEO included measures, most Andrew our now the financial

Andrew Stanleick

making call. quarter. you the you the last Thank afternoon, Good everyone, quarter and on strategic and update to presented through quarter first masterplan I progress excited joining you, are our the first thank earnings we our outstanding Eduardo. in that I'm walk for performance on you

hard Health passion, topics, I and and to those begin their thanking global Before to work, team turning by the community for want Beauty commitment.

the talented of fourth employees CEO, meeting our of the world. my had as privilege enter I month As and providers throughout many I've

revolutionary as growth quarter with community was our Health, with remain the achievements company sales to with X in I we warm deliberate year-over-year. you about in our experience-led nearly me, against a door XX% future the are proud we and Slide offers are and the your momentum and to system strong significant confident connected system during the initiatives. and as quarter of strong to a support, the experience mid-March. all the this approach which quarter's past field, U.S. deliver we net to and improvements by from February partnered we turn receiving personal our and and few in very This product Growth the the combined we the thrilled community. increasing make With months, and of the Beauty launch now delivery grew digitally consumers. these continued Having development. report the next-generation carry feedback You and new for highlights. as is. and our innovation to early providers promotions U.S. SYNDEO driven in SYNDEO cocreated planned January connection and saw the strategic unveiled I'm discuss Brent closely team's by with ever strategic count dedication I'll have pleased first overseas is we extended to such validates incredible for am forward. it welcome

three phases, detail launch plan which of Our will SYNDEO shortly. you consists for I

form typically liken new Providers that sales expectations buy were from would within it with first of planned our trade-up the consumers surrounds exceeded industry Our Early the phone forecast systems. the rollout our an surpassing far on nearly system amazing same have driving scrambling along of executing delivery trends did phase volume team strong a adoption continued launch. major new trade-ups job hype our to to threefold. I sales.

million to in million. last our pleased to of USD a for XXX million system outlook XXX and year USD SYNDEO to trade-ups, I XXX we the range EBITDA a to raise of I to result sales of XX to the As early the full million demand also quarter million, like am of would made USD up from net USD XXXX. reaffirm success that delivering our XXX USD guidance commitment previous higher-than-anticipated

X. to Slide Turning

We relationships which each our in macroeconomic ability continue built pillars. like we category in to are creator, strategic a as climate self-confidence. reinventing skin, perform our growth five spend of plan the their bodies, current those This to execute masterplan. few now I'd to as moments key on on our confident true mission is and on support pillars, a consumers with

insights increased and transforms personalization, the engagement discussed with providers and we connected innovation last Beauty needs. drive driving throughout both experience SYNDEO experiences our will better data quarter, and Health our community. key supplying consumer is understand for consumers the meet As leverages to and for to providers SYNDEO data community. SYNDEO's and

As mentioned, out SYNDEO in I three phases. is rolling

unveiling As delighted we we Orlando X, team from intentionally under wraps you to SYNDEO kick our sales force, of our know, the SYNDEO. and kept off Phase global sales in our meeting with during

system. to system. champions who The and recently accounts SYNDEO ecstatic their clear and our our Our profitable yet our drive reward buzz of engaged To providers March promotion the ran we trade-up attractive with excitement intentional was new most offer force to an driving immediately XX-day was sales excitement, providers loyal in convert into within and purchased an help community. enthusiasm, this targeted them Elite

entire expected. progressing promotion install stated The than have we platform. our is the goal incredible greater demand an that base far As towards drove we was and SYNDEO success on previously, have to our aim in

the placements. start our both a second reception our locations and products demand for network, focused utilizing to start through new delighted entire and continued providing and market new see sales proof into a to huge placements. system the The second to providers force all at our off and engaging experience. these for are superior accelerate latest We seen connected, We technology consumer of strong untapped QX system of on we've the kicked as X in quarter, serves opportunity We expand services. QX the point have of Phase the

international on the in will expand an Finally, incredible launching in we see where to opportunity brand. Phase X, we HydraFacial markets focus

We off towards the to expect this phase or of XXXX early year. kick end next

in flavor quarter. to and in how This providers, in growth, continue their consumable we invest our our growth a system purchase sales X we our critical invest the we to of Slide will double-digit been see faster. because is pillar second when in give Next, XX% providers have you

as beautiful merits Dr. & countries. World doctors, to from events Medicine opinion the of event, to just This our discuss At look London, of products is attendees make system. Aesthetic met providers, the renowned part XX,XXX at providing space and March, the in and New for efforts over Monaco, a the support These network. to and we Nassif, brand-building of delivery the partner part in total plastic a platform a as in in Xth in our our centers our estheticians, interactive At these the events, and key one attendees. At of Congress HydraFacial with we of of Anti-Aging XX% with leaders, Serum critical As surgeon to HydraFacial host XXX events showcased world, a around we a XXth showcase expand world's the many Experience we of users the provider York opened our HydraFacial Centers esthetic providers our HydraFacial typically we one participated educational Paul end respectively. serve setting. where up the events new largest installation Booster QX,

Serum brand to HydraFacial consumers. a undertake bringing JLo the with to by iconic I JLo continue a initiatives also market. and to Jennifer Beauty her To We thrilled am amongst accelerate partnership to end, the Booster awareness that Lopez brand announce

not to We help consumers. ideal our expect a HydraFacial to by an and booster partner us rollout more in fall by her interest accelerate to broaden to could key the appeal, activation awareness swagger, of seek that With and as is an Google of JLo and events dedication works, up the data very the in investments awareness points, with broad confidence, brand constantly support measured effectiveness consumer We by this to mass partner with Search We validate with measuring level skincare launch. icon. be in Trends. along of I'm encouraged consumer the excited influential such

an you on XX, see for is search As high. can at all-time brand our Slide volume

XX QX strong diverse are to gaining a consumers continued Additionally, younger consumer treatments data that we we increasingly and measured confidence base. Interest we to Survey that continue first. our demonstrating for value to and conviction our product have shows that robust face latest face consumer more and in is a with affinity. them Net growing, the life will with empower Promoter increased Score traction illustrates XX, from data

Next, we support to our a out infrastructure, ambitions Page building with remain focused on few our XX. growth highlights demonstrated global on

will value center the continue up in to chain efficiencies are logistics EMEA optimize engineering and and supply QX such region, business efforts within third-party through creating we process. a as We projects. for the Frankfurt logistics seek This includes in setting our

to acquisitions. continued increase plans We as approach to facet also strategic will our future hiring strategy. communications, to out prudent We in the abroad, lastly China create path and periods. a support targeted operating to remains accelerating overall build of our profitability this disciplined in scale, our with And investments leverage expansion marketing, market. at key bench we very technology, talent and including and M&A home These maintain quarter our a

focused are capture highly quarter, wellness. on we In and we three will the whitespace between aesthetics, last targeted discussed a us there and to opportunities in so, continue criteria strategic examine to manner. As are allow will that doing key beauty,

it Net a Score. to Promoter product First, or high differentiated service needs be with truly

drive quarter, further complementary And making and am incredibly masterplan throughout it In financially and call momentum success. business. has progress across infrastructure. point ideally to SYNDEO's of launch esthetician of year. rest positive our both top lines. am we we community, costs the U.S. should with proud opportunities, to excited bottom are synergies fulfilling accomplished with the we are am in I that I is in existing the these be the and team an summary, the with existing focused overwhelming the and I first the on Second, and outstanding leveraging seeing to accretive third, the thrilled our been initiatives what platform advance

in are in detailed the in acceleration seen upsides investment reemergence and fueled will we've has strength for confident our be dividends, Liyuan our paying bench of first rapid This consumer call momentum other the will world. a in stronger, business, further as these we will now reopen, of we over a performance. the what product around locked the more by providers that, proud I Once in such our we've down interest of are cities never to China. been markets With we're our discussion similar reopening cities to see Our turn built. quarter

Liyuan Woo

and touch and our first balance you through Andrew, Thank you walk discuss results, I'll us. sheet, everyone year quarter our full Today our thank you, for guidance. joining on

I to want results, the to take into minutes Before business XX. model a our on jumping Page few revisit

recall razor-razorblade our I the consumables We system explained quarter. and razorblades. as You'll model delivery as our last razor associate the view

model, providers. Looking we our revenue first at sell Systems Delivery to HydraFacial the

to As a a will a the typically a the or one supply HydraFacial looking system sales It historically previous delivery including perform in treatments they model. in represent options, practice, booster trade-up are generation providers of of purchase A our system their exhaust to low-single-digit segment. Trade-ups of year. consumables current increase provider system three is treatments, their of and revenue growth system consumables, driving reorder they various delivery their HydraFacial for a first perform to can reasons. the of or HydraFacial they are they serum for either purchase volume percentage delivery adding system

crisis a successful will higher-than-expected for on model. their demand new will is I to delivery very turn in accomplished what inflation, Page QX trade-ups persistent XX. trade-up and to supply China, moments. already touch as providers have in summary on upgrade now the in the I quarter, few to despite SYNDEO more look deeply chain revolutionary our troubling the in disruption. performance we global this first However, We're driving dynamics proud launch Ukraine, of lockdowns systems

approximately as in the record of of driven net you by headwinds the strong XX% by and at trade-ups. can drove in up as for APAC, with delivery quarter SYNDEO global supported deliver XX% we We year-over-year. nearly XX.X well top launch SYNDEO the demand This slide, see delivery systems growth sales sales our delivered was USD both system million, system the system first the of by despite left quarter. Looking consumables of successful sales

QX SYNDEO as weeks final of the deal on are new to the in of shipping the strength we quarter, As out orders launched was take the trade-up from in addition March. continue in seeing we end orders

year-over-year. We which sales also with saw strong consumables increased growth XX%

first in China, particularly approximately monthly in region, the regions. medical USD In to saw year-over-year colleagues colleagues could APAC, fresh conversion and year-over-year This way the our in their the sales XX.X year to sequential the parts I'm year-over-year in our by fruits by particularly which our increased proud resilient, XX.X so the throughout net homes, They increased softness in vegetables strict continued together we're leave their take been XX% support arranging trends driven Shanghai. across and are team acknowledge Importantly, million, the saw marketing-driven of moment come Americas we to utilization and improvements to China. channel. sales quarter, raising full would team to driven in to front Despite sales guidance, quarter Globally we Shanghai offset growth all doors. I not of confident productivity of SYNDEO In lockdowns delivery net our in have still USD today. million. has in China, strength strong by by while continued due like of leads. for sales to was a our Australia, those nearly XX% based certain partly we in

remain measures. lockdown thoughts with by those the Our impacted all

million, increased net approximately USD the to region. strength EMEA, sales across at broad-based year-over-year with Looking XXX% XX.X

Andrew fueled year. last our region marketing discussed, in also of and activation tradeshows of comp against COVID-impacted the As the QX growth

starts promotions you seasonality, was trends lower sequentially industries. versus prior to builds of in you any first aesthetics wellness typically throughout historical sales year-end which and consistent QX also As beauty and across quarter the QX in given I'd of higher with the our drive year. see the mentioned the remind past, like of year, year, with the

we strategic margins make to investments year. We this boost and the the support productivity seen the second Importantly early these year sales and seasonality in half. the our in continue anticipate stronger trends

expansion. including to quarter marketing efforts strong support was and hiring planned performance international by investments, Our first supported activations our

impacted in we associated the quarter, SYNDEO. cost for the on with launching adjusted which the by chart can You EBITDA of right, was see million X.X saw USD the

to expect year. ramp as We the see we adjusted our up EBITDA progress through

lower the in our The XX.X%. the point gross a well lift in to chain trade-up of chart GAAP and continued in where logistics leverage This quarter year-over-year and margin partially costs, slide, and acquired the gross was we XX with sold the our regions to higher units center our by was cost reported adjusted basis Moving of margin margin pickup distributors. a the by as supply fixed offset we as XX.X% during improvement driven ASP. their

a we We expect global offset supply initiatives chain and inflationary headwinds in to continue the accretion through value throughout XXXX, and of will second half continued from year. which margin the efforts of realization our pricing engineering

you the Finally, bottom our like to key on slide, turning the update I'd performance indicators. of to

an trade-up It our system resulted from existing our is record delivery base install a that trade-up the including X,XXX sold as install note trade-ups. an a XX,XXX activity has of the new base removed base in systems impact we system the This of in at end QX. sold. First, on quarter, install when zero important XXX net to is is

selling ASP, average price system, was of XX,XXX the in quarter. delivery the or Lastly, USD a

the was demand by existing ASP the Our launch. phase during the from impacted provider SYNDEO of activity trade-up our first for

promotional end offers was offer Before We're only less we year at We released like take The than systems enticingly trade-up of and most selling to the one loyal trade-up SYNDEO systems profitable in customers. would expired moment old, cost unit our reward our this trade-up of all and our in not move March. economics. I a below the to of for result aggressive on, connection launch to pricing promotions our dynamic. with discuss discounted strategically

reception to community This a and exceeded system. the expectations. loyal have and an is of promotions our following increasingly our new desirability trade-up our testament in the our We to provider strong revolutionary delivery

captive gross gross result, trade-ups we view ASP over we margin from transitory, to these margin and sales as trade-up as will a and QX initial impact year said, the an we'll with the wave decrease throughout our sales All to with demand It expect additional of on we business captive force new sales force handing progress these impact management the with selling in bifurcated process of delivery closing managers. As on our the sales in focus orders. impact and over X,XXX a our Further, is team new is on as ASP account as that system business development managers trade-up occurring bulk the focused QX. that sales our development systems.

trade-up our previous conviction a in into higher blended delivery to XXXX, due in margin despite I volume activity. will the I we of quarter first drives impacts. not XX. a being As new carries a neutral achieve deterioration dive our system. SYNDEO remind result, And will to gross increase system high-single-digit the on in ASP, trade-up a expect do you sales new a that cost Slide sales ASP This than our details able system now

USD as XXXX. talent launch; up first compared COVID-impacted higher fuel higher or mentioned we to delightfully with the planned growth. and basis where personnel-related the to meeting force quarter our to global we last quarter said of by first was in last pressures, spend and continue XXXX, points, X,XXX particularly future over the Selling selling impact sales and sales of disruption marketing quarter expenses in were our increased to marketing global the XX.X This first margins compared our we to XX.X of driven quarter, XX inflationary to of million to Breaking quarter to globally the expenses the this XXXX. for SYNDEO; points of support launch compared expand supply increase we down, USD our headwinds As chain freight, expect up the year. from and in basis to million, sales, XX.X% marketing fourth cost

marketing spend. our initiatives of to evaluate order maximize ROI As Andrew the our earlier, mentioned in we constantly

continued We invest hosted our those have our program. and training Experience HydraFacial at as our programs, also to Centers CONNECT such in

SOX includes million USDX.X stock-based cases. Our executive million transition compensation costs million pursue expenses, USD G&A expense non-cash of public of Investments ongoing in USD D&O which as additional increase XXXX we million million as infringement of audit the G&A company costs costs, Public of drove company increased infrastructure USD XX in to personnel-related XX.X million totaled this fourth expenses transaction quarter XX.X higher due to the in the and well trademark USD or and insurance, quarter, and costs million headcount. and $X in and in litigation compared X.X first expenses quarter tax-related and patent one-time hiring, of as XXXX. compliance, services, USD buildout, X.X include

We expect near the term. costs continue such public company to in

in During out we the quarter building international our infrastructure. investment continued

As which on The the and includes BXC a technology. by ERP BXB X, productivity platform previously new successfully rolled shared, phase platforms. agility global leveraging out increases of and improves November platform we first ERP global CRM and our

with product expansion Over the year compared platform as is build these platform, and million investments dividends pay major a X.X was and invested progress Touching to over ramp our inform for efficiencies QX. for business. time make that our on quarter USD milestone million development. R&D. in to of USD technology which within digitally-connected will sundew USD up we by the continue business technology million we X.X ecosystem future digitally-connected This next in we to expect in few the driven spend We We the expect forward. going to the integration X.X first globally quarters efforts prior operating and yield the

health to and our earlier, a the rapid create as us expansion outlined key USD M&A it remain beauty while sheet drive with With innovation strategic remains our experience-led tenet million in We positioned our actionable. now products highlights to that to of market. Andrew balance XXX.X balance, initiatives keeping on on equivalents. move and As XX. in the execute quarter I'll well opportunities differentiated share enables hyper-growth masterplan cash Page this we cash ended

convertible recall XXXX other uses. the increase sheet, We the third among million in continue of balance flexibility our to raised acquisitions, you'll to carry in for strategic quarter approximately USD which were XXX notes on

supply supplies We invested to impact launch to components bought blunt disruptions. have the and as also the chain ahead ensure inventory we adequate in of global of SYNDEO

are our XXX shares million. Finally, approximately current outstanding

our outlook to now Turning XX. Slide on full year

continued As up raising demand Andrew success million, our XXX for driven by detailed, XXX we previous net million, around to million USD guidance XXX sales the USD are of a strong for for from the USD our XXX early to of systems USD million world. SYNDEO to range guide and

to We As previously, XXXX. have reserve previously XX stated we our conditions the to right EBITDA thus continue back into the reinvest confirm should stated USD for adjusted business guidance investments. we of profits such million warrant

investment confident recall our buildout. that historical conclusion, back final investments be masterplan. continue we execute in focus initiatives the will drive out levels. carrying will our to margins complete operational to ability our our leveraging next elevated infrastructure will as EBITDA Starting to and of executing our XXXX year year we In we You our shift against by to are towards

to the continued very expect bolstered during launch. We considers year, guidance China. further see including the quarter disruption, the typical in that by of sequential our in year the full demand lockdowns Note macro successful pickup second SYNDEO

front we're the mentioned, about with continued XXXX should excited throughout to opportunity as of performance the about optimistic and guidance momentum for We're across ever quarter year. as the the in our pleased Andrew upside us remain conditions As first of extremely and potential macro business. our the improve very

questions. We your take will gladly now

Operator

with [Operator Steph Instructions] question Jefferies. Wissink first from Our comes

Steph Schiller

to you Andrew, ask marketing a I question strategy. about wanted your

us into users also So but partnership. SYNDEO, peek JLo and super on you've sneak your the given a updates their

little complementary that then talk range about you're developing a already just might any are you're about bit could partnership? and you or there be techniques to strategies the marketing using other the of a super and celebrity both users If thinking implementing that

Andrew Stanleick

high think quarter, on last joined of LOWvolution spoke in The whilst reach. first which the is one my think limited a observations terms I successful number on-ground very I they the much that tour, Company ROI, activations I very Health Steph, Beauty focused had very was when of we with as marketing

months together build approach around invest we've balanced around world is our last tours complemented still in recall what of do that's our I opening digital to I'm I of part by a the influencers of Experience which social is that, I to marketing we've in time world, there And, the last months on-ground think think marketing. JLo. celebrity, where another to one need So and course, ago. to been the in been a really the developed working, something three -- why to what is few that mentioning and feel and Centers, we've which was over role complement social, a the investing York up part across that's budget the and the we the more excited with proud addition New been visited with we've announce the And you I partnership paid

I an awareness. and she'll our think I brand help icon, a great be in amplifying think she's

Steph Schiller

a essentially filled Liyuan, like had walk It the could question. throw timing sounds in of trade-ups? end getting requests on one question. if recognition we're I technical hadn't one, quarter. revenue you this great. It's you through the at some That's trade-up just but more the Could you that the of

So just the the revenue how through walk perspective? as costs a well P&L how us through then and flow recognition works trade-up timing from

Liyuan Woo

Absolutely. Steph, question. great

about to as March, of and the delighted of and now half second also we know, the shared days. we've previously we from have know, towards SYNDEO you demo new And close our in surprised sales people. for So, machine month launched XX as you

send to as they to demo Now the unit units. we have them new us timing allow the sell to

thousand units you as part speaking, that essentially month a over we after which, -- of were trade-up that we us had of heard all after the shipping end. So

once these So, and usually based the unit take upon trade-up with that's the we we that's the in the new order the based as from on the associated units the and take accounting cash trade-up the ship up how value when when revenue we the front point and we treatment on they put accounting new point -- there of well. works the really And as recognize so then we treatment view, we all back ship price units then

Operator

from Chen is Cowen. Next question Oliver with

Oliver Chen

SYNDEO models just next progress And How is the line, The quarters? pricing on the gross do the to in you initiatives, on evolve very mix trade-up mentioned margin expect encouraging. few you also new would love thoughts international, of on follow-up incorporate your in our terms markets? international included in take in on your what's and your should guidance we there? the what A

Andrew Stanleick

and I'll the to To your on then of Liyuan. pass question. start part address first

and the growth. earlier, market ultimate We especially our we've had the in launch drove the get purchased gradual on as mid-March as today, will finished QX it's launched about system, see if to get that elite out go the which talk providers promotion of you'll promotion where certainly encourage more because to is those everyone I drive which consumer So, SYNDEO the the over then of which data U.S. many system, but, about a talked planned the we've that and rest and March SYNDEO of at SYNDEO our end also who've and year into course, to demand, will we planned stated we goal system. on recently stops short-term we roll intentionally further very ultimately the of of the knowledge before and

and the there and margin your comment question on over to return who can later. to we pause hand Liyuan can I'll So international

Liyuan Woo

on to the what Andrew has bifurcated. said, down you trend, look Oliver, when add filled is at yes, team already, so as essentially the we

and side focusing machines observing, --kind the really on on of trend of exactly anticipated. new as the are So, it's we the team [indiscernible] based the we're hunter

the March we're build essentially starting starting to slowdown is on the new side. because done purchased the of trade-up on You're see system and right best end the newly by see the the for see gradual slowdown deal the more to side and

new Oliver, and really the that essentially the to to machine margin's goes in remarks, back we see haven't at it we volume of as a because optimization engineering up doing, from and quite point start these front the the of quarter when prepare to half since been then come actually a gross alluded actually we second comes this and of we've bought components. and So trade-up in the you started when for and bit anticipate margin hand-in-hand that brand anticipate is capture value view, to impact up even we work second with big ASP we margin a all that's network, kind

appreciate that of being friction end can putting the towards anticipate to you as So see really effort that to in, XXXX. we the start

Andrew Stanleick

we've the markets, had and seen other we've like saw the a Indeed strong Australia, of a in EMEA we've lot of strong. China, the locked the Shanghai of we up and and seen, the be accelerate. QX, had with the down open terms gives very that quarter. in of uplift exception particularly market seen Oliver, Demand in international been where and which lockdown, consumables, what of Likewise sales encouraging I even Shanghai think we've will year. in due specifically very, a when upside when outside very rest have for we've very remains markets And the cities encouragement encouraging us seen really business systems both of is Shanghai really which

the For as the given guidance, year. though, for in and the we of our we've the moment confirmed Liyuan built rest lockdown have in to, which spoke

Liyuan Woo

clear true to the down we precisely fact APAC Oliver, the only indication is lockdowns. at such the lockdown growth wasn't deal, see slowing guys actually add testament but big grow same that the Yes, XXX%, there, team, When a you you the can growing was thing XXX%, the that of time business the give the at to of trend XX% a because is right.

Operator

with Gong JPMorgan. is The next from question Allen

Allen Gong

some good were quick the that had I the asked. I a already guess of questions quarter. on to follow-up Congratulations just

there still omicron and a it you the confident driving very guide start still strong impacts to off, tailing out some but that you saw you obviously like some BA.X seems You in enough able the beat felt were the fact despite had the year there with with above that hopefully is to uncertainty quarter.

we we strong beyond SYNDEO such when really you with So in what's raise when gave the the a just think year? stronger about what guidance come stronger to launch, confidence early the at consumables, this driving that? And out really look

Andrew Stanleick

are even we doors to think just actually didn't globally in start consumables I a actually think mid-March. and SYNDEO to caveat important sales, system the And I launch existing is launched question to a We testament had until U.S. tremendous new the it's your January February before and HydraFacial by health we earlier SYNDEO and the care I the And and heard fact got levels increases confident. on google trends. that invest search to ultimately choosing the to skin and think awareness for our their of speak record in we've you strong as demand consumers and still me brand care

to the what extremely why, really high seen we're XX, which a brand. is really score because XX much felt set why on increase You've so And increasing to we're NPS the growing versus team shows to beauty. brand previous that and in this our affinity I'm best of the measure we kept awareness is doing as that's doing of secret the

more Because more trial people awareness and it, get So with we coming back talks JLo to to to get really it to QX. we'll and really them they you we brand. and we've trialed, to get this experienced unlock that in the in brand when keep have lock success on

Liyuan Woo

X-folds, actually that add about I'll that thing very to we one as marketing. you make other consumable we on is of downtrend, exciting improvement us power of we're China the especially with only the the in is happy sense. The see Allen, thing the terms only sequential one see that the side What's APAC, and a Yes talked to lot really that's for market. of

growth worth I'll we remind can especially thing if clear a That's marketing when increasing we on side. mentioned that are then a EMEA, see engaging, that consumables the we the systems. of that EMEA, return. the these observe awareness it And we last when all for and QX coming you we because As impact that machine, brand usually of comes as to we months indication consumable we would out in actually increasing so QX with up that sell see earlier, trade-ups rolled of, significant sold more consumables, fact in three two new we with

kind So we're this monitor share with closely the of observe. guys continue to you very we to trend going and

Allen Gong

the when you a when then like that contribution there are a in the XXXX? Are and one flex fact partial that might quarter, in might some generate there's assuming is SYNDEO see given you you little have And launch It really so we bit of of range What guidance you Or slip into international we trade-up the there? those you of upside really all quick your volumes to much about only that today sounds saw think on that so follow-up. start, in that and as for that were some SYNDEO. able guidance? leaving launches interest of

Liyuan Woo

Allen, the on to data, to connection. Andrew's globally, internationally, the point, we I think wanted sure that very launch be preparing mentioned remark had making wanted we thoughtful,

could that potential depends took depends of this actually we the we're the our to point There on on conditions going period and if we forward. it that so from launching be be guidance view, upside pull consideration, experiencing. into So

Operator

Margaret from is William question next The with Kaczor Blair.

Malgorzata Kaczor

Jennifer to perhaps I'm little partnership. multi-faceted detail put to it around one and going a one bit Lopez a it's the more leave --

guys So, at what to or is And right brand Beauty's made in the what relation over going push to her her drive how partnership. for to like there herself search you of her to role you has do? the partner lot role looks set it they XXX a you on interaction they then you JLo How What engagement? and partner the up year are Because of quick look a JLo follower and course, obviously, followers, depending be guys? going course Beauty engagement? and of going to million that are that awareness do JLo as potential got and

Andrew Stanleick

HydraFacial delivers with Instagram so glow. which And really of to I fall. a question, behind team is -- our with and your as -- launch also launch on partnership with she mean, in you I'm me Glow you that the iconic followed obviously, premise with awareness. product her to part and serum. There's of most know skincare something one you amount activation, strong on help when her that's in We're line drive building the to million with Jennifer which felt significant our alone. The readily very and of We we're it that's with the excited really followers we're fact booster a the plus us very built a logical fact feel consumer brand answer. of with excited In the fall. we that people JLo gave as on planet XXX somebody partner the

see across out the marketing play that during period. you'll So, that

Malgorzata Kaczor

will to ends just as this you that in meaning JLo continue be guys of herself actually be partnership. clear kind and Okay this actively up involved that

Andrew Stanleick

support Yes, will I this won't go into course, with serum the be details, of yes, around from booster JLo. exclusive launching HydraFacial it but

Operator

The Hazan with next question Goldman from is Sachs. Amit

Unidentified Analyst

on Amit. [Phil] is This for

a chain chain earlier provider commenting front, equipment supply environment aesthetics supply had for input an componentry. on today adjacent the acquiring we challenging On

in being Just from wondering inflationary pressure equipment standpoint, seeing if the demand disruption the satisfy you equation? to gross incredibly strong obviously standpoint. side able can comment. an margin I for kind thus you saw what's any cost terms of a of from far Are of

Andrew Stanleick

kick it the all spoke over to job SYNDEO, Liyuan it to did Liyuan. forward significantly. bought hand off and buying fantastic in I'll mean, as I launch components of I I team on a last the here and think first call, we of for

does components, Liyuan? out the and be -- the so and the next back been the more but or during quarter and through catching during the up last to deliveries. We completely were them extreme fully time, So quite because week we've by in just on adequately to not up was working quarter we'll satisfy relate -- able just and in to door overwhelmed on it get date the we've that componentry. demand call to in orders of week demand, been demand those last the

Liyuan Woo

forward is Yes and bought that's our and were really very proud the from by we team hard it as always so has "back the production same have line. We that to actually This ship coming to been fulfill. comes the orders" components, we March in working demand right, the it why we the time, point probably anticipating order when there fact also out. we're reiterate extended same trade-ups that day to we X:XX, high the on the first

emphasize kind happy that a we initial merger's to very demand were out value impact clear fact engineering QX So, that the view, through that flow lot again of will the we that by wanted the we're terms in the working able of is increase. very combat just cost on point big of chunk ASP to volumes trade-up be hard of speak. because crimping But margin as and growth we From and shipping satisfy to of that. a team these really

Unidentified Analyst

satisfy demand good job of pre-buying in of ahead summary about feel that in be to moving very still and forward? the you're this so to And good position significant demand able

Liyuan Woo

Absolutely.

Andrew Stanleick

even add product value yet. we started Just to to this haven't engineer

to future work and upside be all done that's ultimately. So

Operator

question Genuity. next Kyle The from with Rose is Canaccord

Unidentified Analyst

here the To on Kyle. This start, for the all is appreciate trade-ups around call. Gibran I on detail

users? legacy trade-ins could those the the promotional types the power customer of with users we the bit or in if Maybe targets? they into understood multiple was I promotional there in just had the system Are doing Maybe hoping on they color system? any here, participating aforementioned maybe trade-ups. systems single a the dig how profile outside of dynamics With early in stages long accounts

Andrew Stanleick

though circa had typically And -- would That's all customers from our small We've a average above. I they from had say to XX the we've X trading value it's five is of independents years our Indeed great years. anything old. up. the question. systems last can and

really to to the fleet of drove data the as get SYNDEO, so as enormous possible, which or though one as where them really I new fast we really the think can entire have SYNDEO see when time, think they buy I fantastic everyone I they interesting and was that chains to at fleet an access having that so really direct that's consumer. do on but upside to was the that to they took very struck because what think of this we facts us during expected identical what we're want advantage the unlock trade-up, and all two really same power March they decide keen

Unidentified Analyst

around more to launch? a just Glow then on formalized And that? launch tracking? been and limited still you Or little that's coming & maybe what looking are When to what data can helpful, expect something actively maybe bit out Go you has are soft an gather update understand? Andrew. that that maybe and underway Is we Understood looking of how that

Andrew Stanleick

question. Great Yes.

team So, new in I ensure form device, terms this confident brought our and new, to new but for is time innovation and will we for of we're some take-home market in of there remain people some different. launching is take a the technology what quarter we just during better

So Frankly, phase. all We the Go. this of guidance last for as this give included Glow Go in I you ensuring testing though, more that I'll year, QX. product & any second haven't review SYNDEO we've so the of process And quarter quarter our detailed it quarter. fourth another the -- launch started Glow been of still want year. the on during is That & update to of especially flawless and we any in in in a you focused know,

Operator

from with The Block next question comes Jon Stifel.

Jon Block

I show driving one, Juggling an a and the you're a the the going? supply revs still where's costs, things, at just XXXX talk margin weren't XX call where it next just at million 'XX, maybe but couple first you is -- so up to and hopefully awareness, level, accelerating investment maybe extra it just high earlier. committed dollars does just expansions heightened alluded year? there? EBITDA can unchanged, to the Maybe asked it sounds like just I to which comment leverage these those Is Maybe to. us through are inflation going, mean, chain the walk what's us you've think

Andrew Stanleick

question. Great

in new of even we've we've encouraged doors driving the continue terms consumer SYNDEO. to were the to what opening I turn and the all willingness think, launched to robust been so consumers their I by winning said been and continued we first for So, just as we And guidance, demand before earlier, of and new doors, enhanced HydraFacial. seeing

prioritize to anecdotal consumers guidance the that still just was the just demand remains exceptional the and providers continuing to as self-care. from market from confidence response from us gave feedback SYNDEO strong the what think really very continue I raise

That's the upside growth of that as virtuous is to quarter, driving and we've turning to it driving on profit. awareness now of revenue $XX majority EBITDA. keep In it brand the goals, marketing take to that our our million that commitment to talked keep file terms last reinvest why we in want for we ultimately our of and reaffirmed

fueling delivery growth into So, of we to invest any brand. reserved really have the over right the that

Liyuan Woo

and John, I'll sales of shared to trying the investment where and point we as we're is allocation constantly from triangle So, marketing with thing you training right. an view, between that golden to only that optimize before add

folks. some market, it's for folks just and newer marketing hiring essentially of So, sales training matter the of and people

to So, we're disciplined line the point, managing mind there's that's sure top pretty number a that have Andrew's be the both make going very, then maniacal just it when and we learn and to the really one, people and addition tasks obviously bottom lot to of at we're very of line this to for in in and top business, us. to comes

Jon Block

the their was to reaching the uptick SYNDEO it Got it. did free you LED Liyuan, accounts. a utilization? bit does Are re-engage door guys get practices consumable didn't the can question, would and new of I throttle is Very we you if these so help that pulling them the the out set SYNDEO, adopter re-engage reached help last of the consumables a get the laying out systems it you helpful go decent little these time a revitalize surprisingly, from revs but driving in forget and out practice account thing? ahead? We make economics -- through by complete and earlier the that up, us SYNDEO sort down maybe of full the back where you talked rep but a going attack this every or sure maybe about is have type are with you and on it check maybe roof, the does process go to Does a it standpoint? actually talk of period? road up at a to about follow-up And some consumables machine, their for it help know

Andrew Stanleick

consumables the once into the -- new and in launch. last in I during that's new it's since a really the of whole with re-engaging and the And interest HydraFacial. it's absolutely, training, the providers the machines, a really aestheticians machine time Yes, back really weeks driving lot few spent field also with the

exciting of a giving year. forward again as it's moment So, the confidence for we to and us really the rest look us

Liyuan Woo

Yes, John effort our to and is of and lot say, and our but had doing the we just with the really to of focus trade-ups on two-folds, that with along absolutely reiterate, really we're of just a suffice customers. end to actually to lot there's key lot continue educating of to point, field -- I our feel area with is the a customer, we're to element say speaking one would obviously launching fact way going your training utilization happening, that the a

Operator

question [Operator James. with Olivia is Instructions] next Tong Raymond The from

Olivia Tong

to I'll try stick question. one and

sales. on just the So, EBITDA, EBITDA guide guys you maintained better despite on

costs, love just of you that a the and year? drivers that? more levels more through we're the about a selling and Obviously, promotion? desire talk key a it bit external progress just a little some promotional view little could Was So detail more there all so to marketing about higher grappling bit your as is do with on factor and would we

Andrew Stanleick

keep and trends robust Well, opportunities JLo the virtuous will with it's the ensure just we've seeing, with we're that keep maximize QX, want in that have where to of the deployment and until and turning. the the of we the investment those to vast seen social, upcoming growth first just the education. Really, into That's marketing in of virtuous we with as really going keen global right spiral event, training all, with paid into reinvested very and spiral QX be see most to majority and going. we the

where So, the investment predominantly that's is.

Liyuan Woo

to the but top in growth. and to go we're going a be line our drive to to and future I there's so if back fuel process wanted up we've thoughtful, dollar Olivia, hybrid that's allocate further that's just to always sense want going and very because and that will always are fuel point, a no company, training along emphasize been dollar always reiterate Yes the forward, growth just to the growth all we sure ample in speeding make want other planned there's areas marketing -- to to to we we

Olivia Tong

lines partnership, now. And you Got quick is obviously, the guys? With for JLo with follow-up. there's one right no exclusivities celebrities is to to it she partner of skincare of with respect any just others then allowed there shortage or and kind

potential legs? on with further? that Just Could either angle to So social view platform potentially kind is your you're you some -- others, cetera? influencers, of on media an could that et you thinking ability partner leverage this has curious celebrity,

Andrew Stanleick

skin about in look of really of brand first partner of and at excited JLo, exclusive, brand I that proven of already, beauty And fall. forward -- the the Serum just if million celebrity. for a the pyramid XXX wellness, as but role partnership Glow with course, Booster before around us. as how And, That's and a ideal has was of But drive of Instagram following brand we us. Sure consumers we're partnership absolute someone we this all over the activating we built think I iconic of on partner look also physicians, influence influences, and has the what course, so spoke we for awareness, influencers, the skin role see with is the who for. the a she premise and to with in HydraFacial to JLo care

Liyuan Woo

Olivia, talking in is that about. I so make sure but us pyramid that Andrew end truly sense a we want like with exclusivity multiple just allow it players we're to partner don't company, do pure the essentially to to Yes,

Operator

Jackson from Benchmark Next question Bruce The is Company. with

Bruce Jackson

quarterly rest usually how the to in up Can revenue revenue help a get model regard pacing, QX. the With trajectory the year? you in just you the to guidance and pretty the of step for big us

Liyuan Woo

quarter we quarter. these and right? QX Like sequentially always start that of as low slight quarter. so come have to the for we yes, then the QX sort trade-ups this have a a we're growth of to give backlogs for you that Is you through business, build that's helpful? for a boost going Bruce, mentioned, fact after kind -- The

Operator

The KorinneWolfmeyer. next is from question

Korinne Wolfmeyer

there one quick role get providing up ask but system older to over just systems the where and in But supporting stop one making SYNDEO consumables those SYNDEO? anymore, not systems? to you since maybe or getting on older the point we're expand you'll order I converted systems will kind So any time. HydraFacial of of at like at stop U.S. your what everyone is older that in point fit older know for maybe here selling here maintenance you're I'll that

Andrew Stanleick

will globally. keep older Just customers SYNDEO elite which those honor the course, intention and manufacturing Clearly get in everyone of visited, to course, continue U.S. the facility, our which as those when unlock on get to know, have goal [indiscernible] is reiterate, and you that ultimate get have then system, those on who the SYNDEO the of needed our data ultimately warranties warranties, to but you on with that to starting to relationship we is consumer. direct valued everyone

Operator

question Linda is from Davidson. DA The with Bolton-Weiser next

Linda Bolton-Weiser

Or first lower pretty up, this run on business bit what of expenditure normal this know rate some of a as just was for higher a the basis of just ramping the the in somewhere it kind wondering I'm system little selling normalized give I term launch back quarter, new looks than long marketing in business XX%? type you XXXX probably what marketing a of a that was world and was business? is basis? sense and it like XX% high can is between because like to -- us kind I It curious XX% is the just on but was but ratio

Andrew Stanleick

experience. leverage rightly to we of profitability. for in of mind. guide lean aiming the on marketing based which, of would leaned this that exceptional virtuous will we It's year, somewhere in of the That's And of obviously probably be my will but SYNDEO, a in a in there. the in XX% benchmark investment we'd investment to XX% spiral range which we, give keep the what growing on good brand dividends, forward as I you launch growth have the in what quarter later the noted, of course, course, pay of

Liyuan Woo

Yes, Linda, in the only of leverage. we're APAC for thing Obviously, the I'll pandemic emphasize still is the power market. the time

we're Andrew range So, This to it's is year. you a what grow. this be might should term quickly come your we thinking point really mentioned, has of range that That as about. longer see kind not

Operator

I remarks. back for to our concludes and answer turn Stanleick any over the question Andrews to This would session. closing like conference

Andrew Stanleick

this rest build to excited I operator. mean, the the throughout we're with business. the momentum seeing year. pleased to We're of you summarize, the first Thank results extremely we're across on our trends and quarter

boosting best that you deliver to soon. confidence connecting thank to continue that's for I you we all in kept the As But forward glow again us secret beauty. with joining again look today.

Operator

you conference The attending for has concluded. now presentation. Thank today's

may You disconnect. now

The Beauty Health Company (SKIN) 14 May 222022 Q1 Earnings call transcript