PROCEPT BioRobotics' Earnings Call: Reported 66% Increase in Revenue

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PROCEPT BioRobotics' Earnings Call: Reported 66% Increase in Revenue

PROCEPT BioRobotics (NASDAQ: PRCT) reported significant revenue growth in the third quarter of 2024. Total revenue reached $58.4 million, marking a 66% year-on-year increase. The company's financial performance was supported by robust demand for robotic systems, particularly with a 64% growth in its U.S.-based installed base. The launch of the HYDROS Robotic System contributed to this success despite initial challenges. PROCEPT also announced a new clinical trial for Aquablation therapy and reported improvements in net losses, indicating a clear path toward strategic growth and profitability.

Key Points

  • PROCEPT BioRobotics reported a 66% increase in total revenue for Q3 2024, reaching $58.4 million.
  • U.S. revenue was $52.2 million, showing a 62% increase.
  • The HYDROS Robotic System contributed to 80% of new sales.
  • International revenue grew by 86%, with significant sales in the UK.
  • The company's gross margins reached a record level of 63.2%.
  • Net loss improved from $24.6 million the previous year to $21 million, with adjusted EBITDA loss also showing improvement.
  • PROCEPT expects full-year revenue for 2024 to be between $222.5 million and $223 million, with gross margins around 61%.

Company Outlook

  • Full-year revenue is projected to grow approximately 63% to 64%.
  • The company anticipates selling around 186 robotic systems by the end of 2024.
  • International revenue is expected to increase by 88% to reach $22.4 million.
  • Operating expenses are forecasted to rise by 29% to $231.5 million.
  • Adjusted EBITDA loss for the full year is expected to be around $60 million.

Negatives

  • Utilization per account showed a decline on a yearly basis.
  • Saline shortages and hurricane interruptions affected transaction volumes, leading to some cancellations.

Positives

  • The HYDROS system has been well received, with most launches planned for late 2024.
  • The company is optimistic about expanding treatment options for prostate cancer and expects to scale up the ASC channel pilot program in 2025.
  • Positive reimbursement dynamics with private payers like Medicare, Humana, and Cigna support growth.

Shortcomings

  • Training of sales representatives for the HYDROS system is expected to temporarily impact transaction volumes in Q4.
  • Some transactions were sacrificed for a careful launch of the HYDROS platform.

Q&A Highlights

Kevin Waters discussed guidance for Q4 and the cost impact of the HYDROS launch, expressing confidence in future cost competitiveness and margin improvements. Reza Zadno emphasized the company's focus on producing Level 1 data to support guidance inclusion and market expansion.

PROCEPT BioRobotics continues to successfully execute its growth strategy. The strong financial performance in Q3 2024 and promising developments in product offerings indicate progress. The company is focused on expanding its market presence in prostate cancer treatment and moving toward profitability in the upcoming fiscal year.

InvestingPro Insights

PROCEPT BioRobotics’ impressive Q3 2024 performance aligns with several key metrics and insights from InvestingPro. The company's revenue, which increased by 66% to $58.4 million, is consistent with InvestingPro data showing a strong 73.74% revenue growth over the last twelve months as of Q2 2024. This robust growth trend is also reflected in stock performance, with InvestingPro reporting an impressive total return of 163.59% over the past year.

Despite showing a negative operating income of $109.64 million over the last twelve months, PROCEPT's gross profit margin of 54.73% aligns with the record gross margin of 63.2% reported in Q3. This indicates effective cost management while scaling operations.

InvestingPro highlights that PROCEPT operates with a moderate level of debt and that its liquid assets exceed short-term liabilities. These factors provide financial flexibility as the company continues its growth phase and moves toward profitability. Additionally, noting that PROCEPT's stock is trading near its 52-week peak (96.56% of the peak), supports the positive sentiment surrounding the stock following strong quarterly results.

For investors seeking a more comprehensive analysis, InvestingPro offers ten additional insights that provide deeper information on PROCEPT BioRobotics' financial health and market position.