Glaukos Corporation (GKOS) reported record fourth-quarter 2024 revenues of $105.5 million, reflecting a 28% year-over-year increase. This growth was driven by strong demand for its innovative glaucoma and corneal health solutions. The company’s success in expanding its iDose TR adoption and international footprint further bolstered its financial performance. As GKOS continues to expand its footprint in the ophthalmology sector, key elements should shape its trajectory this year.The increasing prevalence of ...

Financial Performance - Net sales for 2024 reached $383.481 million, a 21.9% increase from $314.711 million in 2023[354]. - Gross profit for 2024 was $289.454 million, up from $239.136 million in 2023, reflecting a gross margin improvement[354]. - Total operating expenses increased to $411.820 million in 2024, compared to $367.836 million in 2023, primarily driven by higher selling, general and administrative expenses[354]. - The net loss for 2024 was $146.372 million, slightly higher than the net loss of $134.661 million in 2023[354]. - Cash and cash equivalents increased to $169.626 million in 2024, up from $93.467 million in 2023, indicating improved liquidity[353]. - Total assets grew to $974.756 million in 2024, compared to $940.414 million in 2023, reflecting a strong balance sheet[353]. - Stockholders' equity increased significantly to $766.931 million in 2024, up from $461.766 million in 2023, driven by additional paid-in capital[353]. - The company reported a net operating loss (NOL) of $147.8 million for the year ended December 31, 2024, compared to $138.2 million in 2023 and $101.3 million in 2022[512]. Revenue and Sales - The company’s revenue is derived from product sales in the U.S. and internationally, with revenue adjustments for volume-based rebates and other incentives[348]. - Total revenue for glaucoma products increased from $237.0 million in 2023 to $303.3 million in 2024, representing a growth of 27.9%[464]. - The company has faced challenges in auditing net sales, particularly in evaluating discounts and incentives related to customer programs[350]. Cash and Liquidity - The company has significant amounts of cash and cash equivalents at U.S. financial institutions that exceed federally insured limits, posing credit risk[337]. - Cash, cash equivalents, and restricted cash at the end of the period increased to $174.4 million from $99.3 million at the beginning of the period[362]. - The company maintains cash balances exceeding federally insured amounts, indicating a strong liquidity position[376]. Expenses and Costs - Research and development expenses were $136.425 million in 2024, slightly down from $138.768 million in 2023, indicating a focus on cost management[354]. - The company recorded advertising costs of approximately $3.6 million, $3.4 million, and $2.5 million for the years ended December 31, 2024, 2023, and 2022, respectively[413]. - Depreciation and amortization expense related to property and equipment rose to $10.1 million in 2024, up from $7.3 million in 2023, marking an increase of approximately 38.4%[438]. Risks and Challenges - The company reported a significant risk related to the commercial success of its iDose TR product, which could materially impact its business[19]. - The company faces potential supply and manufacturing disruptions that could reduce gross margins and negatively affect operating results[19]. - The company has not yet achieved sustained profitability and may fail to generate sufficient sales of its commercialized products[19]. - The company is exposed to foreign currency exchange risks, particularly as international operations grow, which could increase operational costs[338]. Foreign Currency and Hedging - A hypothetical 10% fluctuation in foreign exchange rates would have an immaterial impact on the company's net loss as of December 31, 2024[340]. - The company has not entered into foreign currency hedging contracts but may consider doing so in the future[339]. Stock and Equity - The weighted-average shares outstanding used to compute basic and diluted net loss per share increased to 52.755 million in 2024 from 48.433 million in 2023[354]. - The company has 5,000,000 authorized preferred stock issuable, with no preferred stock outstanding as of December 31, 2024, and December 31, 2023[428]. - The total stock-based compensation cost for the year ended December 31, 2024, was $50.2 million, an increase of 15.4% from $43.5 million in 2023[510]. Tax and Deferred Assets - Deferred tax assets increased to $269.6 million as of December 31, 2024, from $224.0 million in 2023, primarily due to an increase in net operating loss carryforwards[513]. - The valuation allowance for deferred tax assets increased by $50.7 million in 2024, indicating management's expectation that a portion of these assets may not be realized[514]. - The company had approximately $527.5 million in federal NOL carryforwards as of December 31, 2024, with $322.8 million subject to an 80% limitation on future taxable income[515]. Acquisitions and Investments - The company acquired a clinical stage biopharma company for $5.0 million in stock and $5.1 million in cash, with potential future payments of up to $201.0 million based on development and sales milestones[370]. - The company’s investment portfolio is primarily in marketable securities, with all investments stated at fair value[377]. Lease and Liabilities - Operating lease liabilities increased from $30.4 million in 2023 to $33.9 million in 2024, an increase of approximately 11.5%[455]. - The total lease liabilities rose from $103.2 million in 2023 to $105.9 million in 2024, indicating an increase of approximately 2.6%[455]. - The contingent consideration liability increased from $1.4 million to $1.6 million during 2024, reflecting a change in fair value due to updated assumptions[447].

Core Insights - Glaukos Corporation received FDA notification for the New Drug Application (NDA) of Epioxa, a next-gen corneal cross-linking therapy for keratoconus, allowing for substantive review [1] - The FDA's review completion goal date for Epioxa is set for October 20, 2025 [1] - The acceptance of the NDA is a significant step towards providing the first FDA-approved, non-invasive corneal cross-linking drug therapy for keratoconus patients [2] Clinical Data - The NDA submission includes data from two Phase 3 pivotal trials that met primary efficacy endpoints and showed favorable safety and tolerability profiles [3] - Epioxa employs a proprietary drug formulation designed to penetrate the corneal epithelial layer, along with a stronger UV-A irradiation protocol and supplemental oxygen to enhance cross-linking [4] Market Reaction - Following the news, Glaukos' stock price increased by 25%, reaching $157.36 in premarket trading [4]

Core Insights - Glaukos Corporation reported a narrower adjusted loss of 40 cents per share for Q4 2024, better than the Zacks Consensus Estimate of a 43 cents loss and improved from a 63 cents loss in the same quarter last year [1] - The company achieved revenues of $105.5 million in Q4 2024, reflecting a 28.1% year-over-year increase and surpassing the Zacks Consensus Estimate by 4.7% [2] Revenue Details - Net sales for Glaucoma reached $84.1 million, marking a 39% year-over-year increase, while sales in Corneal Health remained stable [3] Margin Analysis - Gross profit rose by 21.1% year-over-year to $76.9 million, with an adjusted gross margin of 82%, down from 84% in the previous year [4] - Selling, general, and administrative expenses increased by 9.5% year-over-year to $69 million, while research and development expenses decreased by 1.4% to $36.5 million [4] Financial Update - Glaukos ended Q4 2024 with cash and cash equivalents and short-term investments totaling $324 million, up from $267.2 million at the end of Q3 2024 [6] 2025 Guidance - The company expects 2025 revenues to be between $475 million and $485 million, significantly higher than the previous guidance of $370 million to $376 million, with a loss per share estimate of $1.08, indicating a 42.8% improvement year-over-year [7] Operational Highlights - The glaucoma franchise's revenue growth was driven by the iStent portfolio and increasing contributions from iDose TR, with plans to enhance market access for iDose TR in 2025 [9] - Glaukos is advancing its product pipeline, including an NDA submission for Epioxa, with expected approval by the end of 2025, and is conducting a phase 2b/3 clinical trial for iDose TREX [10][11] Market Performance - Following the Q4 results, shares of Glaukos fell by 13.6% in after-market trading, although the stock has gained 6.1% year-to-date, contrasting with a 0.1% decline in the industry [12]

Financial Data and Key Metrics Changes - Glaukos reported record fourth quarter consolidated net sales of $105.5 million, up 28% year-over-year [9] - For the full year 2024, consolidated net sales reached $383.5 million, growing 22% compared to 2023 [10] - The company provided full-year 2025 net sales guidance in the range of $475 million to $485 million [10] Business Line Data and Key Metrics Changes - U.S. glaucoma franchise achieved record fourth quarter net sales of $56.3 million, reflecting a strong year-over-year growth of 45%, primarily driven by iDose TR [13] - International glaucoma franchise delivered record net sales of $27.9 million, with year-over-year growth of 28% on a reported basis and 29% on a constant currency basis [21] - Corneal health franchise reported net sales of $21.4 million, including Photrexa net sales of $18.8 million, benefiting from entry into the Medicaid Drug Rebate Program [23] Market Data and Key Metrics Changes - The U.S. market for glaucoma procedures includes over 20 million eyes with ocular hypertension or glaucoma, with approximately 10 million actively treated [55] - The international growth outlook for 2025 is expected to be high single-digit growth, impacted by foreign exchange headwinds and competitive product trials [82][84] Company Strategy and Development Direction - Glaukos aims to pioneer new marketplaces within ophthalmology, focusing on interventional glaucoma and innovative treatment options [11] - The company is expanding its clinical literature and training programs to support the adoption of iDose TR and enhance market access [14][15] - Plans to build a new research, development, and manufacturing facility in Huntsville, Alabama, to support future expansion [29] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the continued growth of iDose TR, with expectations for increasing adoption as reimbursement confidence improves [39] - The company anticipates that the headwinds from new LCD restrictions will peak in the first half of 2025, with a gradual improvement expected in the second half [51] - Management remains optimistic about the potential of Epioxa, a next-generation corneal cross-linking therapy, with an anticipated FDA approval decision by the end of 2025 [25][27] Other Important Information - The company ended 2024 with cash and equivalents of approximately $324 million and no debt, following the retirement of $287.5 million in convertible senior notes [30] - Glaukos is advancing a Phase 2 clinical program for its third-generation iLink therapy and plans to commence a Phase 2 trial for iLution Blepharitis in 2025 [28] Q&A Session Summary Question: Can you elaborate on the trends seen with iDose in the quarter? - Management noted strong performance with iDose TR revenues doubling compared to the previous quarter, supported by positive clinical outcomes and expanding surgeon training [35][36] Question: Can you break down the components of the 2025 revenue guidance? - Management indicated that the guidance reflects healthy expectations for the iDose franchise, while non-iDose revenues may see flat to low single-digit growth due to LCD headwinds and the expiration of the Hydrus royalty [41][42] Question: How do you expect the impact of LCD headwinds to play out in 2025? - Management expects the headwinds to peak in the first half of the year, with some improvement anticipated in the second half [51][52] Question: What is the status of iDose's market share compared to DURYSTA? - Management characterized the growth as overall market expansion rather than direct share gains from DURYSTA, emphasizing the opportunity for multiple products to grow together [58][59] Question: What is the expected timeline for iDose TRIO? - Management expects to begin a small safety study for iDose TRIO mid-year, with a commercial launch anticipated in 2026 [92] Question: How is the uptake of iDose varying between larger and smaller facilities? - Management noted that smaller facilities tend to adopt iDose more readily, while larger systems face more bureaucratic hurdles [122]

Company Performance - Glaukos reported a quarterly loss of $0.40 per share, better than the Zacks Consensus Estimate of a loss of $0.43, and an improvement from a loss of $0.63 per share a year ago, representing an earnings surprise of 6.98% [1] - The company posted revenues of $105.5 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 4.71%, and showing an increase from year-ago revenues of $82.37 million [2] - Over the last four quarters, Glaukos has surpassed consensus EPS estimates two times and topped consensus revenue estimates four times [2] Stock Outlook - Glaukos shares have increased approximately 7.1% since the beginning of the year, outperforming the S&P 500's gain of 4.5% [3] - The current consensus EPS estimate for the coming quarter is -$0.35 on revenues of $106.44 million, and -$1.08 on revenues of $477.69 million for the current fiscal year [7] - The estimate revisions trend for Glaukos is favorable, leading to a Zacks Rank 2 (Buy) for the stock, indicating expected outperformance in the near future [6] Industry Context - The Medical - Instruments industry, to which Glaukos belongs, is currently in the top 34% of over 250 Zacks industries, suggesting a positive outlook for stocks within this sector [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Financial Performance - Fourth quarter 2024 net revenues reached $105.5 million, a 28% increase compared to Q4 2023, while full year 2024 revenues totaled approximately $383.5 million, up 22% from 2023[6][7] - Total net sales for 2024 reached $383.5 million, a 21.9% increase compared to $314.7 million in 2023[68] - Net sales for Q4 2024 reached $105.5 million, a 28.1% increase from $82.4 million in Q4 2023[60] - International glaucoma sales for 2024 were $103.7 million, reflecting a year-over-year growth of 21.2% from $85.6 million in 2023[68] - U.S. Glaucoma net revenues for Q4 2024 were approximately $56.3 million, reflecting a 45% year-over-year growth, with full year revenues of approximately $199.6 million, a 32% increase from 2023[10][11] - International Glaucoma net revenues for Q4 2024 were approximately $27.9 million, representing a 28% increase year-over-year, while full year revenues were approximately $103.7 million, up 21% from 2023[13][14] - Corneal Health net revenues for Q4 2024 were approximately $21.4 million, a 2% decline year-over-year, with full year revenues of approximately $80.2 million, reflecting a 3% increase from 2023[16][17] Expenses and Losses - Non-GAAP SG&A expenses for 4Q 2024 were $68.6 million, reflecting a 10% increase year-over-year from $62.3 million in 4Q 2023[24] - Non-GAAP R&D expenses for 4Q 2024 were $36.5 million, a 1% decrease year-over-year from $37.1 million in 4Q 2023[24] - The company reported a net loss of $146.4 million for 2024, with a basic and diluted net loss per share of $2.77[65] - Non-GAAP net loss for 4Q 2024 was $22.2 million, compared to a net loss of $30.6 million in 4Q 2023[24] - The company reported a net loss of $33.6 million in Q4 2024, an improvement from a net loss of $36.8 million in Q4 2023[60] - Basic and diluted net loss per share for Q4 2024 was $0.60, compared to $0.75 in Q4 2023[60] - Operating expenses for 2024 totaled $261.2 million, compared to $224.1 million in 2023, indicating a significant increase in costs[65] Margins and Profitability - Fourth quarter 2024 gross margin was 82%, a decrease of 150 basis points year-over-year from 84% in 4Q 2023[24] - Gross profit for Q4 2024 was $76.9 million, compared to $63.5 million in Q4 2023, resulting in a gross margin of 72.9%[60] - Gross margin improved to 82.4% in 2024, up from 83.0% in 2023, despite a cost of sales of $67.5 million after adjustments[65] Future Outlook - The company expects full-year 2025 global consolidated net sales to be between $475 million and $485 million, considering various market dynamics and potential headwinds[19] - The company is preparing for potential FDA approval and commercial launch of Epioxa™ by the end of 2025[21] - In 2025, the company aims to advance enrollment in the PMA pivotal trial for iStent infinite and commence the US IDE trial for PRESERFLO MicroShunt[36] - The company has 14 pipeline programs entering 2025, focusing on glaucoma, corneal disorders, and retinal diseases[37] Research and Development - The company has invested over $700 million into R&D programs since 2018, with recent updates including NDA submission for Epioxa™ and advancements in multiple clinical programs[21][20] - iDose TR, a new glaucoma treatment, is expected to reshape glaucoma management, with positive clinical outcomes and feedback from trained surgeons[11] - The company is advancing commercial launch activities for iDose TR and iStent infinite, with new reimbursement codes expected to enhance patient access and coverage[18] Cash and Assets - Cash position increased by $56.4 million quarter-over-quarter, totaling $323.6 million in 4Q 2024[24] - Cash and cash equivalents increased to $169.6 million as of December 31, 2024, from $93.5 million a year earlier[61] - The company’s total assets as of December 31, 2024, were $974.8 million, compared to $940.4 million at the end of 2023[61] Compliance and Market Dynamics - The company emphasizes the importance of compliance with federal healthcare programs and maintaining adequate reimbursement coverage for its products[56] - The company anticipates potential headwinds in U.S. Glaucoma stent business due to final LCDs and competition from combo-cataract MIGS globally[19] Product Development and Marketing - The Radius XR platform is being marketed to enhance eye disease detection and patient management[49] - The company has received FDA clearance for its Radius XR wearable patient engagement and diagnostic system and the iAccess precision goniotomy[51] - The company is focused on successfully commercializing its iDose TR therapy and expanding its product offerings[56]

Core Insights - Wall Street analysts anticipate Glaukos (GKOS) will report a quarterly loss of $0.43 per share, reflecting a year-over-year increase of 31.8% [1] - Expected revenues for Glaukos are projected at $100.75 million, which represents a 22.3% increase from the same quarter last year [1] - There have been no revisions in the consensus EPS estimate over the last 30 days, indicating analysts' stability in their forecasts [1] Revenue Estimates - Analysts estimate 'Revenues- Corneal Health' to be $21.53 million, showing a decrease of 1.2% from the prior-year quarter [4] - 'Revenues- Glaucoma' is expected to reach $79.53 million, indicating a year-over-year increase of 31.3% [4] - The average prediction for 'Revenues- Glaucoma- United States' stands at $54.32 million, reflecting a significant increase of 40.3% year-over-year [4] Regional Revenue Projections - The consensus estimate for 'Revenues- Corneal Health- United States' is $19.10 million, indicating a year-over-year decline of 3% [5] - 'Revenues- International' are projected to be $27.40 million, suggesting a year-over-year increase of 14.3% [5] - 'Revenues- United States' are expected to reach $73.43 million, reflecting a 25.7% increase from the previous year [5] Additional Revenue Insights - Analysts project 'Revenues- Glaucoma- International' to be $25.05 million, indicating a year-over-year increase of 14.6% [6] Stock Performance - Glaukos shares have experienced a decline of 2% over the past month, contrasting with the Zacks S&P 500 composite's increase of 4.7% [7] - With a Zacks Rank of 3 (Hold), Glaukos is expected to closely follow overall market performance in the near term [7]

iDose TR Clinical Data and Market Impact - iDose TR demonstrated sustained efficacy in a 36-month follow-up analysis, with 70% of patients remaining well-controlled on the same or fewer IOP-lowering medications compared to 58% in the control group [4] - The implant achieved a mean IOP reduction of 11.3 mmHg (44%) at six months post-operation in a Phase 4 study involving 60 open-angle glaucoma patients [6] - iDose TR received FDA approval in December 2023 for reducing intraocular pressure in patients with ocular hypertension or open-angle glaucoma [2] iDose TREX Development - Glaukos initiated Phase 2b/3 clinical trials for iDose TREX, the next-generation sustained-release platform with nearly double the drug capacity of iDose TR [8] - Early-stage clinical updates suggest iDose TREX could extend therapeutic efficacy duration and enhance patient outcomes [8] Financial Performance and Market Position - GKOS shares gained 17.7% in the past six months against the industry's 0.6% decline [3] - The company's glaucoma franchise witnessed revenue growth in Q3, driven by iStent portfolio and growing contributions from iDose TR [11] - Glaukos successfully executed detailed launch plans for iDose TR in Q3, with the unique permanent J-code becoming effective on July 1 [11] Competitive Landscape - The positive clinical data on iDose TR and advancement of iDose TREX provide Glaukos with a significant competitive advantage in the ophthalmic market [9] - iDose positions Glaukos as a leader in procedural pharmaceutical solutions by addressing critical challenges in glaucoma treatment [9]

Stock Performance and Market Position - Glaukos Corporation's stock reached a new 52-week high of $155 76 on Jan 6, closing at $155 20 [1] - The stock has surged 89 3% over the past year, outperforming the industry's 6 4% rise and the S&P 500's 26 8% growth [1] - The company has a market capitalization of $8 56 billion [2] Financial Projections and Growth Drivers - Glaukos projects earnings growth of 16 7% for 2024 and 42 8% for 2025 [2] - Revenue is expected to grow 26 3% in 2025 [2] - The iStent portfolio significantly boosted glaucoma franchise revenues in the first nine months of 2024 [6] - The launch of iDose TR in Q2 2024 is enhancing revenue growth, with a permanent J-code effective July 1 likely to increase patient access and drive future sales [6] Product Portfolio and Pipeline - Glaukos submitted a New Drug Application (NDA) to the FDA for Epioxa (Epi-on), its next-generation corneal cross-linking iLink therapy for keratoconus [5] - The company is advancing its robust pipeline of novel, dropless platform technologies designed to improve outcomes for patients with chronic eye diseases [8][9] - The development of the iLink system using Epioxa therapy was delayed following a pre-NDA submission meeting in 2022 that recommended a second confirmatory study [10] International Market Expansion - Glaukos' international glaucoma franchise recorded 17% growth compared to the same period in 2023 [7] - The company sells products through subsidiaries in 17 countries and independent distributors in other markets [7] - International operations are expected to support long-term growth [7] Competitive Landscape - Glaukos faces stiff competition from medical companies, academic and research institutions, and other entities developing new drugs, therapies, medical devices, or surgical procedures for glaucoma [11] - Competitors include divisions of larger companies with greater resources and smaller companies targeting specific products or geographies [11] Industry Comparison - Cardinal Health, Inc (CAH) has a Zacks Rank 2 (Buy) and an estimated long-term growth rate of 10 2%, with shares gaining 13 8% compared to the industry's 1 2% growth [12][13] - ResMed Inc (RMD) has a Zacks Rank 2 and an estimated long-term growth rate of 14 8%, with shares gaining 36 1% compared to the industry's 8 5% growth [13] - Boston Scientific Corporation (BSX) has a Zacks Rank 2 and an estimated long-term growth rate of 13 8%, with shares rallying 56 3% compared to the industry's 8 5% growth [14]