Align Technology(ALGN)2024-10-23 20:06Revenue Performance - Q3'24 total revenues were $977.9 million, an increase of 1.8% year-over-year, but a decrease of 4.9% sequentially[1] - Q3'24 Clear Aligner revenues were $786.8 million, down 5.4% sequentially and down 1.0% year-over-year[1] - Q3'24 Imaging Systems and CAD/CAM Services revenues were $191.0 million, an increase of 15.6% year-over-year[1] - Net revenues for Q3 2024 reached $977.872 million, a 1.7% increase from $960.214 million in Q3 2023[25] - GAAP net revenues for Q3 2024 were $977,872, a year-over-year increase of 1.8% from $960,214 in Q3 2023[34] - Clear Aligner net revenues for Q3 2024 were $786,844, down from $794,939 in Q3 2023, reflecting a year-over-year decrease of 1.4%[35] - Imaging Systems and CAD/CAM Services net revenues for Q3 2024 were $191,028, up 15.6% from $165,275 in Q3 2023[35] - Constant currency net revenues for Q3 2024 were $977,747, reflecting no impact from foreign exchange[34] Profitability Metrics - Q3'24 operating income was $162.3 million, resulting in an operating margin of 16.6%, down 0.7 points year-over-year[2] - Q3'24 net income was $116.0 million, or $1.55 per diluted share, with non-GAAP net income of $175.6 million, or $2.35 per diluted share[2] - Gross profit for Q3 2024 was $681.774 million, compared to $663.076 million in Q3 2023, reflecting a gross margin improvement[25] - GAAP gross profit for Q3 2024 was $681,774, compared to $663,076 in Q3 2023, resulting in a gross margin of 69.7%[39] - Non-GAAP gross profit for Q3 2024 was $688,546,000, compared to $667,875,000 in Q3 2023, reflecting a year-over-year increase of 3.1%[43] - GAAP net income for Q3 2024 was $115,963,000, down from $121,427,000 in Q3 2023, a decrease of 4.0%[45] - Non-GAAP net income for Q3 2024 was $175,622,000, up from $164,321,000 in Q3 2023, indicating a growth of 6.5%[45] - GAAP operating margin for Q3 2024 was 16.6%, slightly down from 17.3% in Q3 2023[43] - Non-GAAP operating margin for Q3 2024 was 22.1%, compared to 21.8% in Q3 2023, showing an improvement of 1.4%[45] Operating Expenses and Cash Flow - Operating expenses increased to $519.476 million in Q3 2024 from $496.730 million in Q3 2023, with R&D expenses slightly decreasing to $85.272 million[25] - The company reported a total operating expense of $519,476,000 for Q3 2024, an increase from $496,730,000 in Q3 2023, reflecting a rise of 4.0%[43] - Net cash provided by operating activities for Q3 2024 was $452.153 million, a decrease from $738.878 million in Q3 2023[29] - As of September 30, 2024, cash and cash equivalents were $1.0 billion, up from $761.4 million as of June 30, 2024[1] - Cash and cash equivalents increased to $1.042 billion as of September 30, 2024, up from $937.438 million at the end of 2023[27] Future Outlook - The company plans to repurchase up to $275.0 million of its common stock beginning in Q4'24[1] - For Q4'24, the company expects worldwide revenues to be in the range of $995 million to $1,015 million[11] - Q4'24 GAAP operating margin is expected to be slightly lower than 14.0% due to restructuring charges impacting operating margin by approximately 3 points[11] - The company anticipates incurring restructuring charges of approximately $30 million in Q4'24[6] - Align Technology anticipates continued growth in Clear Aligner volume and ASP, with expectations for Q4 2024 revenues to remain strong[21] - The company expects continued growth in the number of trained doctors and utilization rates in the upcoming quarters[31] Balance Sheet Highlights - Total assets grew to $6.366 billion as of September 30, 2024, compared to $6.084 billion at the end of 2023[27] - Total stockholders' equity increased to $3.944 billion from $3.630 billion at the end of 2023[27] - The company reported a decrease in deferred revenues to $1.380 billion from $1.428 billion at the end of 2023[27] Utilization and Training - The number of Invisalign trained doctors increased to 85,195 in Q3 2023, up from 83,440 in Q2 2023[31] - Total utilization rates for North America in Q3 2024 were 9.6%, with North American orthodontists at 28.8% and GP dentists at 4.9%[31] - Stock-based compensation included in gross profit for Q3 2024 was $1,974, compared to $1,901 in Q2 2023[32] - Stock-based compensation for Q3 2024 was $49,039,000, compared to $39,602,000 in Q3 2023, an increase of 23.0%[45]