UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended: July 2, 2021 Or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number: 0-11634 STAAR SURGICAL COMPANY (Exact Name of Registrant as Specified in its Charter) (State or Other Jurisdiction of Incorporation or Organization) 25651 Atlantic Oc ...

Financial Data and Key Metrics Changes - Total net sales for Q1 2021 were $50.8 million, up 44% compared to $35.2 million in Q1 2020 and up 10% sequentially from Q4 2020 [14] - Gross profit for Q1 2021 was $39.1 million or 77.1% of net sales, compared to $24.8 million or 70.4% of net sales in Q1 2020 [16] - Net income in Q1 2021 was $5 million or $0.10 per diluted share, compared to a net loss of $134,000 in Q1 2020 [20] Business Line Data and Key Metrics Changes - ICL sales represented 93% of total company net sales for Q1 2021, with strong growth across various regions [14] - Global ICL unit growth for Q1 2021 was up 54% year-over-year, with significant increases in China (up 63%), Japan (up 72%), and the US (up 46%) [6][14] Market Data and Key Metrics Changes - The company anticipates Q2 2021 net sales to be approximately 50% year-over-year revenue growth compared to Q2 2020 [14] - The US market is expected to see a significant introduction of EVO lenses pending FDA approval, with a planned launch in Q4 2021 [12][21] Company Strategy and Development Direction - The company is focusing on expanding its EVO Visian ICL family of lenses and enhancing direct-to-consumer outreach to build awareness [8][10] - A new advertising campaign featuring a Japanese celebrity aims to increase visibility and patient engagement in Japan [9] Management's Comments on Operating Environment and Future Outlook - Management views the current growth as a continuation of pre-COVID momentum, with expectations for sustained growth in the coming quarters [24][25] - The company anticipates total net sales for fiscal 2021 to be approximately $215 million to $217 million, representing over 30% year-over-year growth [13] Other Important Information - The company plans to participate in several upcoming conferences, including the Oppenheimer Medtech Tools and Diagnostic Summit [21] - The company expects to maintain gross margins in the mid-70% range for Q2 and the fiscal year 2021 [16] Q&A Session Summary Question: Source of growth and awareness - Management does not see the growth as a catch-up but as a continuation of momentum pre-COVID, with strong patient referrals and social media engagement driving awareness [24] Question: US and EU implant numbers - Management noted a significant uptake in Europe and the US, attributing it to prior efforts in building awareness and patient satisfaction [25]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended: April 2, 2021 Or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number: 0-11634 STAAR SURGICAL COMPANY (Exact Name of Registrant as Specified in its Charter) (State or Other Jurisdiction of Incorporation or Organization) 25651 Atlantic O ...

Financial Data and Key Metrics Changes - Total net sales for Q4 2020 were $46 million, an increase of 18% compared to $38.9 million in Q4 2019, but down 2% sequentially from Q3 2020 [29] - Gross profit for Q4 2020 was $34.3 million, or 74.6% of net sales, compared to $28.8 million, or 74.1% of net sales in Q4 2019 [31] - Operating income in Q4 2020 was $4.1 million, or 8.8% of sales, compared to $2.3 million, or 6% of sales for Q4 2019 [39] - Net income for Q4 2020 was $3.3 million, or $0.07 per diluted share, compared to $6.4 million, or $0.14 per share in Q4 2019 [40] - Adjusted net income for Q4 2020 was $6.8 million, or $0.14 per diluted share, compared to $5.5 million, or $0.12 per diluted share in Q4 2019 [41] Business Line Data and Key Metrics Changes - ICL sales represented 87% of total company net sales for Q4 2020, consistent with recent trends [31] - ICL unit growth in Q4 2020 showed strong recovery, with significant growth in markets such as China (up 17%), Japan (up 52%), and Germany (up 28%) compared to the prior year quarter [13] Market Data and Key Metrics Changes - The total refractive industry procedures declined by an estimated 21% in 2020 compared to the prior year, while STAAR's ICL units were up 11% [15] - The Middle East remained the most challenged market due to COVID-19 during Q4 2020 [14] Company Strategy and Development Direction - The strategic imperative is to position the EVO ICL family of lenses as a transformational pathway for visual freedom, aiming to capture a disproportionate share of the projected 5.8 million annual refractive procedures by 2025 [17] - The company is focused on increasing consumer awareness, surgeon commitment, and introducing innovative products to new markets [19][23] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the momentum of the business, with expectations for healthy year-over-year growth in the first half of 2021 [51] - The company plans to increase capital expenditures in 2021 to support manufacturing capacity and infrastructure scalability, with anticipated spending between $15 million to $20 million [43][44] Other Important Information - The company welcomed two new members to the Board of Directors, Dr. Elizabeth Yeu and Dr. Peony Yu [29] Q&A Session Summary Question: Long-term targets for ICL growth - Management is confident in achieving a three-year growth rate of 25% and 35% ICL unit growth by the end of 2022, with strong momentum continuing into 2021 [51] Question: Infrastructure investments for EVO and VIVA - Management indicated that investments in infrastructure are necessary for scaling operations, with expectations for operating expense leverage in the future [60] Question: Update on VIVA and U.S. EVO launch - The rollout of VIVA in Europe is planned with additional surgeon training and a playbook ready by September, while the U.S. EVO launch is expected to have strong consumer outreach and partnerships [72] Question: Distributor trends and inventory management - Management noted that distributor stocking and destocking patterns are normal, with no unusual trends observed [75] Question: Demographics for EVO in the U.S. - The target demographic for EVO in the U.S. is similar to that in Asia, focusing on young professionals seeking visual freedom [82] Question: Cash flow and potential M&A - Management emphasized that the shelf registration is standard corporate governance, and the company is focused on organic growth with a healthy balance sheet [88][90] Question: Product mix and pricing strategy - The shift towards lower diopter lenses is supported by clinical validation and pricing strategies to encourage surgeons and patients to choose ICL over LASIK [96] Question: Market dynamics in China post-New Year - Management expressed optimism about strong growth in China following the New Year, with expectations for robust distribution in Q2 and Q3 [99]

Financial Data and Key Metrics Changes - Total net sales for Q3 2020 were $47.1 million, up 21% compared to $39.1 million in Q3 2019, and up 34% sequentially from Q2 2020 [22] - Gross profit for Q3 2020 was $34.9 million, representing 74.1% of net sales, compared to 74.4% in the prior year quarter [23] - Operating income in Q3 2020 was $4.9 million, or 10.4% of net sales, compared to $3.3 million, or 8.5% of net sales in the year-ago quarter [28] - Net income for Q3 was $4 million, or $0.08 per diluted share, compared to $2.4 million, or $0.05 per share in the prior year [28] - Cash and cash equivalents as of October 2, 2020, totaled $128.3 million, up $12 million from $116.3 million at the end of Q2 2020 [29] Business Line Data and Key Metrics Changes - ICL sales represented 88% of total company net sales for Q3 2020, consistent with recent trends [23] - Research and development expenses increased to $8.8 million in Q3 2020 from $6.2 million in the year-ago quarter, primarily due to increased clinical expenses [27] Market Data and Key Metrics Changes - ICL unit growth in Q3 was 25% globally, with standout markets including China (up 33%), Japan (up 67%), and South Korea (up 21%) [10][11] - Excluding India and the Middle East, global ICL unit growth would have been 32% [11] Company Strategy and Development Direction - The company aims to increase global market share from 10% to 20%-30% in the foreseeable future [21] - The launch of the EVO Viva presbyopia correcting lens in Europe is part of the company's strategy to expand its product offerings [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the demand for EVO lenses, reflecting pre-COVID levels, and reiterated the outlook for Q4 2020 with expected net sales of approximately $43 million [21] - The company is monitoring COVID-19 developments and their potential impact on business operations [12] Other Important Information - The company has made progress on two new products for the U.S. and European markets, with plans for FDA submission in the first half of 2021 [17] - The EVO website saw a 250% increase in unique visitors year-to-date through Q3 2020 [16] Q&A Session Summary Question: Pricing and Demand in China - Management confirmed that pricing in China improved, with a strong quarter for average selling prices globally [34] - The majority of demand observed is new demand rather than deferred procedures [37] Question: Refractive Restart Program - The program has helped surgeons attract patients by offering one lens free of charge for bilateral implant patients, resulting in a 70% sequential increase in units [46] Question: Market Share in Japan - Japan has seen significant growth, with the company achieving over 30% market share, and plans to continue working with key opinion leaders [53] Question: Fourth Quarter Expectations - Management expects double-digit growth in Q4, but will be cautious due to potential COVID-19 impacts [71]

| --- | --- | --- | --- | --- | |--------------------------------------------|-------|-------|-------|-------| | | | | | | | | | | | | | | | | | | | STAAR S URGICAL | | | | | | C OMPANY | | | | | | | | | | | | I NVESTOR PRESENTATION S EPTEMBER 2020 | | | | | ⊙STAARSURGICAL OSTAARSURGICAL™ | --- | --- | |---------|------------| | | | | | | | | | | Forward | | | Looking | Statements | Evolution in Visual Freedom™ All statements in this presentation that are not statements of historical fact are forward-lookin ...

Financial Data and Key Metrics Changes - Total net sales for Q2 2020 were $35.2 million, consistent with Q1 2020 but down from $39.7 million in Q2 2019, attributed to COVID-related market closures [22] - Gross profit for Q2 2020 was $24.4 million, or 69.4% of net sales, down from 70.4% in Q1 2020 and 75.4% in Q2 2019, primarily due to manufacturing pause costs and geographic sales mix [23] - Net loss for Q2 2020 was $1.2 million, or $0.03 per share, compared to a net income of $3.9 million, or $0.08 per share, in Q2 2019 [29] Business Line Data and Key Metrics Changes - ICL sales represented 87% of total company net sales for Q2 2020, consistent with Q2 2019 results [22] - Research and development expense was $7.3 million in Q2 2020, up from $6.1 million in Q2 2019, due to increased clinical expenses associated with EVO clinical trials [27] Market Data and Key Metrics Changes - In June, year-over-year ICLM plan procedures recorded strong growth: 65% in Japan, 24% in the rest of Asia Pacific, 17% in Germany, 15% in distributor markets in Europe, and 11% in Korea [12] - China experienced a 6% increase in units in Q2 2020, with a strong demand for refractive procedures as the peak season began [48] Company Strategy and Development Direction - The company aims to achieve a 20% share of the refractive procedure market in China by year-end, supported by a digital marketing strategy targeting 100 million visitors [14] - Plans to restart manufacturing in Nidau, Switzerland, in 2021, and to prepare the Lake Forest, California facility for EVO Viva lens production [15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in a sequential revenue increase of at least 20% in Q3 2020, driven by recovery in various markets, particularly in Asia [21] - The impact of COVID-19 on sales appears to be lessening, with customers indicating no desire to pause procedures again unless mandated [20] Other Important Information - The company has received CE mark approval for its EVO Viva presbyopia lens, targeting a market of 1.7 billion people globally [17] - Cash and cash equivalents as of July 3, 2020, totaled $116.3 million, up from $110.9 million at the end of Q1 2020 [31] Q&A Session Summary Question: Confidence in expected sequential growth in Q3 - Management's confidence is based on recovery in multiple markets, particularly in Asia, with strong July results and peak season in China [36] Question: Margin structure for EVO Viva - Initial production of EVO Viva will be out of Monrovia, with expected gross margins in line with current EVO lenses [38] Question: Trends in China and market share - The company is seeing share gains from moderate myopes and is currently around 18% market share in China, aiming for 20% by year-end [40] Question: U.S. rollout progression for EVO - The U.S. market is more fragmented, but a "refractive restart" program is expected to facilitate a quick ramp-up in adoption [42] Question: Impact of COVID-19 on China’s busy season - There has been no disruption in business in China, with high demand for refractive procedures and effective consumer outreach strategies [68] Question: Initial interest in EVO in Europe - The EVO family of lenses is expected to expand the target demographic for surgeons, increasing overall volume and specificity in marketing [70]

Financial Data and Key Metrics Changes - STAAR reported net sales of $35.2 million for Q1 2020, an 8% increase from $32.6 million in the prior year [23] - ICL sales represented 83% of total company sales for Q1 2020, with a 6% increase in ICL sales contributing $1.6 million to the top line growth [23] - Gross profit margin for Q1 was 70.4%, down from 74.2% in the prior year, primarily due to a higher mix of lower-margin product sales and increased manufacturing capacity costs [24] - The operating loss for Q1 2020 was approximately $1.1 million compared to an operating profit of $1.6 million in the year-ago quarter [28] - Adjusted net income for Q1 was $1.9 million or $0.04 per diluted share, down from $4.3 million or $0.09 per diluted share in the prior year [29] Business Line Data and Key Metrics Changes - Global ICL unit growth in Q1 2020 was up 9% year-over-year, with significant growth in key Asian markets [11] - ICL unit growth in Japan was up 79%, Korea up 14%, China up 7%, and the rest of Asia-Pacific up 37% [12] - In Canada, ICL unit growth was up 10%, and in Germany, it was up 5% despite procedure discontinuation in March [13] Market Data and Key Metrics Changes - The COVID-19 pandemic caused a pause in elective procedures, impacting various markets differently [10] - China resumed EVO ICL procedures, with significant patient interest and promotional activities noted during the Asia Golden Week [38] - Germany managed to keep some clinics open, contributing to continued patient procedures [48] Company Strategy and Development Direction - The company plans to resume double-digit growth in Q3 and Q4, contingent on the reopening of markets and elective surgeries [22][55] - STAAR is optimistic about the approval and rollout of the EVO EDOF lens for presbyopia, targeting a staged introduction in CE Mark countries [15] - The company is focused on supporting surgeons with promotional tools to encourage patient return as markets reopen [59] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in resuming growth, citing strong demand for ICLs and EVO lenses as elective procedures resume [21] - The company expects Q2 to be negatively impacted by the slow reopening of markets, but anticipates a recovery in Q3 and Q4 [22] - Management highlighted the importance of maintaining safety protocols while ramping up production and patient procedures [37] Other Important Information - The company resumed production at its California facilities on April 27, 2020, implementing COVID-19 safety enhancements [13] - Cash and cash equivalents totaled $110.9 million as of April 3, 2020, with expectations of ending Q2 with more cash than Q1 [30][31] - The company invested $2.2 million in property and equipment during the quarter, enhancing manufacturing capabilities [32] Q&A Session Summary Question: What is the current capacity in China post-reopening? - Management noted that initial safety measures limited patient procedures, but capacity is ramping up as confidence grows [36][37] Question: How are U.S. trial centers engaging with patients during the pause? - Management confirmed that constant contact was maintained with clinical trial sites, allowing for a smooth transition back to patient enrollment [40][41] Question: What is the outlook for double-digit growth in Q3 and Q4? - Management indicated that if conditions normalize, they expect to achieve growth above 20% in key markets [55] Question: Will there be pressure on pricing through the year? - Management does not anticipate pressure on average selling prices and expects positive pricing dynamics [58] Question: What is the expected charge for the second quarter due to the production pause? - A charge of approximately $1.4 million will be recorded due to the six-week production halt [62]

Financial Data and Key Metrics Changes - STAAR reported net sales of $38.9 million in Q4 2019, a 25% increase from $31.2 million in the prior year [21] - Gross profit margin for Q4 was 74.1%, up 40 basis points from 73.7% in the prior-year quarter [22] - Net income for Q4 was $6.4 million or approximately $0.14 per diluted share, compared to $1.1 million or $0.02 per diluted share in the year-ago quarter [25][26] - Cash, cash equivalents, and restricted cash totaled $120 million at January 3, 2020, compared to $104 million at the end of the previous year [27] Business Line Data and Key Metrics Changes - ICL sales represented 86% of total company sales for both Q4 and the fiscal year of 2019, with ICL unit growth of 27% [21][22] - ICL unit growth in Q4 was driven by significant increases in Japan (95%), China (43%), Germany (29%), Spain (20%), India (16%), and the US (10%) compared to the prior-year period [9] Market Data and Key Metrics Changes - The company experienced a fourfold increase in visits to its ICL website Doc Finder, with over 1 million visits in 2019, indicating strong marketing effectiveness [10] - Approximately half of STAAR's customers in China remained closed due to the coronavirus, but engagement with healthcare professionals through online training was high [12] Company Strategy and Development Direction - STAAR plans to increase marketing investment and creativity in 2020, focusing on building awareness around the EVO ICL family of lenses [19] - The company anticipates a phased rollout of its EVO EDOF lens for presbyopia by the end of Q2 2020, targeting early presbyopes aged 45 to 55 [18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence that the current pause in procedures due to the coronavirus is a short-term deferment rather than a loss of sales [13] - The company expects a potential $5 million to $7 million delay in sales orders for Q1 but is maintaining its full-year sales forecast for 2020 [14] Other Important Information - STAAR has initiated a search for a new CFO as Deborah Andrews plans to retire in 2020 after transitioning to a new CFO [20] - The company has no supply chain or manufacturing risk in China or other Asian geographies [13] Q&A Session Summary Question: Impact of coronavirus on sales - Management indicated that they expect to recapture delayed sales as customers are eager to resume procedures once clinics reopen [34] Question: Approval timing for clinical trials - Management provided details on the phased rollout plan for the EVO lens and the expected timeline for data preparation for FDA submission [36][45] Question: Capacity to meet demand post-coronavirus - Management confirmed that they are well-prepared to meet demand as procedures are rescheduled [58] Question: Training surgeons before EVO approval - Management clarified that no commercial training can occur until the EVO lens is approved in the US [59] Question: Strategic cooperation agreements and sales delays - Management reassured that flexibility exists in meeting annual commitments despite the sales delays [64]

Financial Data and Key Metrics Changes - STAAR Surgical reported net sales of $39.1 million in Q3 2019, a 23% increase from $31.8 million in the same period last year [12] - The company achieved a gross profit margin of 74.4%, slightly down from 75.1% in the prior year due to expenses related to new manufacturing facilities [13] - Operating income for the quarter was approximately $3.3 million, compared to $1.6 million in the year-ago quarter, resulting in an operating margin of 8.5% [14] - Net income was $2.4 million or approximately $0.05 per diluted share, up from $1.5 million or $0.03 per diluted share a year ago [15] Business Line Data and Key Metrics Changes - Global ICL unit growth was 35% in Q3 2019, marking the ninth consecutive quarter of double-digit growth [4] - ICL revenue growth was 28%, representing 87% of total company net sales for the quarter [12] - Significant regional growth included Japan (57%), China (48%), South Korea (38%), France (20%), Spain (14%), UK (13%), and Germany (11%) compared to the prior year [7] Market Data and Key Metrics Changes - The global refractive surgery market is growing at approximately 2.6%, while STAAR is growing at rates above 35% [24] - The company anticipates strong demand for its EVO EDOF lens for presbyopia, expected to launch in Q2 2020 in CE Mark countries [9] Company Strategy and Development Direction - STAAR is focusing on expanding its market share in lower diopter ranges, particularly in Asia and Europe, while maintaining a strong growth trajectory [23] - The company plans to implement a hybrid business model in several major markets, combining direct sales and distributor coverage [45] - The strategic vision for 2020 to 2022 will be outlined at the upcoming Investor Day [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in meeting financial targets for 2019, including 30% ICL unit growth and 20% company revenue growth [6] - The company is optimistic about the enrollment of patients for clinical trials in the U.S., with a strong interest from surgeons [20] - Management expects to continue expanding gross margins year-over-year and anticipates a strong finish to the year in key markets [37] Other Important Information - STAAR generated a record $11.8 million in cash from operating activities in Q3 2019 [16] - The company is preparing for significant marketing campaigns in Europe and the U.S. to support ICL growth [8] Q&A Session Summary Question: FDA recommendations and patient enrollment timelines - Management received FDA approval to begin clinical trials and is reviewing recommendations to finalize the study protocol, expecting to enroll patients quickly [20] Question: Trends in lower diopter patients and market opportunities - Management noted substantial market share growth in lower diopter ranges in Asia and Europe, with expectations for continued expansion [23] Question: Gross margin impacts and operating expenses - Management explained that startup expenses and lower-margin product sales impacted gross margins, but they expect margins to improve moving forward [31] Question: Timeline for Nidau facility and CapEx requirements - Management aims to resume shipping from the Nidau facility by Q3 2020, with ongoing investments in advanced manufacturing capabilities [33] Question: U.S. market potential for EVO lenses - Management believes the EVO family of lenses could address 70% to 75% of refractive surgery requirements in the U.S. [50]