InMode(INMD) - 2025 Q2 - Quarterly Report

Report Summary and Management Insights Second Quarter 2025 Financial Highlights InMode reported Q2 2025 revenues of $95.6 million with 80% gross margins, GAAP net income of $26.7 million ($0.42 EPS), non-GAAP net income of $30.1 million ($0.47 EPS), and a total cash position of $510.7 million as of June 30, 2025 Q2 2025 GAAP & Non-GAAP Financial Results | U.S. GAAP Results | Q2 2025 (USD thousands) | Q2 2024 (USD thousands) | | :---------------------------------------- | :---------------------- | :---------------------- | | Revenues | $95,602 | $86,449 | | Gross Margins | 80% | 80% | | Net Income | $26,742 | $23,818 | | Earnings per Diluted Share | $0.42 | $0.28 | | Non-GAAP Results | | | | Gross Margins | 80% | 81% | | Net Income | $30,139 | $28,976 | | Earnings per Diluted Share | $0.47 | $0.34 | - Quarterly GAAP revenues reached $95.6 million, compared to $86.4 million in the second quarter of 2024[6] - Quarterly revenues from consumables and service decreased by 6% to $19.8 million compared to the second quarter of 2024[6] - Total cash position as of June 30, 2025, was $510.7 million, including cash and cash equivalents, marketable securities, and short-term bank deposits[6] Management Comments Management acknowledged persistent macroeconomic uncertainty and cautious consumer behavior impacting Q2 results, particularly in the U.S., but highlighted record international sales, especially in Europe, emphasizing disciplined execution, investment in growth drivers, and the strength of the balance sheet, while noting a potential 2-3% impact on gross margins from U.S. tariffs - The second quarter reflects broader trends with persistent external headwinds, including ongoing macroeconomic uncertainty and more cautious consumer behavior[3] - Despite economic challenges in the U.S., international business provided an offset, with sales from Europe reaching a record high in Q2 2025[4] - A strong balance sheet provides flexibility to retain top talent, expand globally, and lead the industry with cutting-edge technologies[5] - Assuming U.S. tariffs remain at 10%, gross margins are expected to be impacted by approximately 2% to 3%[5] Detailed Second Quarter 2025 Financial Results Second Quarter 2025 Financial Results Overview InMode reported an increase in total revenues for Q2 2025 to $95.6 million, up from $86.4 million in Q2 2024 (excluding pre-orders), with GAAP gross margin stable at 80%, non-GAAP gross margin slightly decreasing to 80% from 81%, and improvements in operating margins and net income on both GAAP and non-GAAP bases - Total revenues for Q2 2025 were $95.6 million, compared to $86.4 million in Q2 2024 (excluding $16.2 million in pre-orders)[7] GAAP Financial Performance GAAP revenues for Q2 2025 were $95.6 million, an increase from $86.4 million in Q2 2024, with GAAP gross margin holding steady at 80%, GAAP operating margin improving to 24% from 21%, and GAAP net income rising to $26.7 million ($0.42 diluted EPS) from $23.8 million ($0.28 diluted EPS) year-over-year Q2 2025 GAAP Financial Performance vs Q2 2024 | Metric | Q2 2025 (USD thousands) | Q2 2024 (USD thousands) | YoY Change | | :----- | :---------------------- | :---------------------- | :--------- | | Revenues | $95,602 | $86,449 | +10.6% | | Gross Margin | 80% | 80% | 0 pp | | Operating Margin | 24% | 21% | +3 pp | | Net Income | $26,742 | $23,818 | +12.3% | | Diluted EPS | $0.42 | $0.28 | +50.0% | Non-GAAP Financial Performance Non-GAAP gross margin for Q2 2025 was 80%, a slight decrease from 81% in Q2 2024, while non-GAAP operating margin improved to 28% from 27%, and non-GAAP net income increased to $30.1 million ($0.47 diluted EPS) from $29.0 million ($0.34 diluted EPS) year-over-year Q2 2025 Non-GAAP Financial Performance vs Q2 2024 | Metric | Q2 2025 (USD thousands) | Q2 2024 (USD thousands) | YoY Change | | :----- | :---------------------- | :---------------------- | :--------- | | Gross Margin | 80% | 81% | -1 pp | | Operating Margin | 28% | 27% | +1 pp | | Net Income | $30,139 | $28,976 | +4.0% | | Diluted EPS | $0.47 | $0.34 | +38.2% | Cash Position As of June 30, 2025, InMode maintained a strong total cash position of $510.7 million, encompassing cash and cash equivalents, marketable securities, and short-term bank deposits - Total cash and cash equivalents, marketable securities, and short-term bank deposits amounted to $510.7 million as of June 30, 2025[10] Full Year 2025 Financial Outlook 2025 Financial Outlook InMode updated its full-year 2025 financial outlook, revising revenue guidance downwards while maintaining non-GAAP gross margin expectations, with non-GAAP operating income and diluted EPS guidance also lowered Full Year 2025 Financial Outlook (Updated vs. Prior Guidance) | Metric | Updated Guidance | Prior Guidance | Change | | :----- | :--------------- | :------------- | :----- | | Revenues | $365M - $375M | $395M - $405M | Lowered | | Non-GAAP Gross Margin | 78% - 80% | 78% - 80% | Unchanged | | Non-GAAP Income from Operations | $93M - $98M | $101M - $106M | Lowered | | Non-GAAP Diluted EPS | $1.55 - $1.59 | $1.64 - $1.68 | Lowered | Geopolitical Context The Current Situation in Israel The conflict in Israel and the broader region remains volatile, with a ceasefire between Israel and Iran reached on June 23rd, though its durability is uncertain, and despite ongoing conflicts, InMode's operations have not been materially affected to date, but the company continues to monitor developments closely - The conflict in the region remains volatile, with a ceasefire between Israel and Iran reached on June 23rd, though its durability remains uncertain[13] - To date, InMode's operations have not been materially affected by the regional conflict[13] - The company continues to monitor political and military developments closely and examine the consequences for its operations and assets[13] Non-GAAP Financial Measures Explanation Use of Non-GAAP Financial Measures InMode uses non-GAAP financial measures, including non-GAAP net income, diluted EPS, and operating margin, to provide greater transparency into its economic performance and facilitate comparison with peers, with these measures excluding share-based compensation and related tax adjustments - Non-GAAP financial measures are used in InMode's internal analysis and provide investors with greater transparency of its economic performance[15] - Non-GAAP results exclude share-based compensation and related tax adjustments[2][12][15] Investor Conference Call Details Conference Call Information InMode hosted a conference call on July 30, 2025, at 8:30 a.m. Eastern Time to discuss Q2 2025 financial results, with key management participating, and details for pre-registration, dial-in numbers, and webcast access, including replay information, were provided - A conference call was hosted on July 30, 2025, at 8:30 a.m. Eastern Time, featuring CEO Moshe Mizrahy, CTO Dr. Michael Kreindel, and CFO Yair Malca[16] - Participants could pre-register or use provided dial-in numbers for the call, which was also webcast live[17][18][19] - A replay of the conference call was available from July 30, 2025, to August 13, 2025, via dial-in and for 90 days on InMode's website[19] Company Profile About InMode InMode is a leading global provider of innovative medical technologies, specializing in devices harnessing novel radio frequency (RF) technology, developing, manufacturing, and marketing a comprehensive product line for various medical specialties, including plastic surgery, gynecology, dermatology, otolaryngology, and ophthalmology, focusing on minimally invasive RF technologies - InMode is a leading global provider of innovative medical technologies, developing, manufacturing, and marketing devices utilizing novel radio frequency ("RF") technology[20] - The company offers a comprehensive line of products across plastic surgery, gynecology, dermatology, otolaryngology, and ophthalmology, leveraging medically accepted minimally invasive RF technologies[20] Legal Disclosures Forward-Looking Statements This section clarifies that the press release contains forward-looking statements regarding future events or financial performance, which are subject to inherent uncertainties and risks, meaning actual results may differ materially from forecasts, and InMode disclaims any obligation to update these statements, cautioning investors not to place undue reliance on them - The press release includes forward-looking statements related to future events or InMode's future financial or operating performance, including the 2025 revenue projection[21] - These statements are based on management's current expectations and assumptions and are subject to inherent uncertainties, risks, and changes in circumstances, meaning actual outcomes may differ materially[21] - InMode undertakes no obligation to update these forward-looking statements and cautions against undue reliance on them[21] Contact Information Company and Investor Relations Contact Contact information for InMode's Chief Financial Officer, Yair Malca, and Investor Relations representative, Miri Segal of MS-IR LLC, was provided for company and investor inquiries - Contact details are provided for Yair Malca, Chief Financial Officer, and Miri Segal of MS-IR LLC for investor relations[22] Consolidated Financial Statements Condensed Consolidated Statements of Income The condensed consolidated statements of income show InMode's financial performance for the three and six months ended June 30, 2025, compared to the same periods in 2024, detailing revenues, cost of revenues, operating expenses, and net income Condensed Consolidated Statements of Income (Q2 2025 vs Q2 2024) | Metric (USD thousands) | Q2 2025 | Q2 2024 | | :--------------------- | :------ | :------ | | REVENUES | 95,602 | 86,449 | | COST OF REVENUES | 19,152 | 17,116 | | GROSS PROFIT | 76,450 | 69,333 | | TOTAL OPERATING EXPENSES | 53,569 | 51,019 | | OPERATIONS INCOME | 22,881 | 18,314 | | INCOME BEFORE INCOME TAXES | 30,943 | 27,004 | | NET INCOME | 26,742 | 23,818 | | Diluted EPS | 0.42 | 0.28 | Condensed Consolidated Statements of Income (Six Months Ended June 30, 2025 vs 2024) | Metric (USD thousands) | 6M 2025 | 6M 2024 | | :--------------------- | :------ | :------ | | REVENUES | 173,476 | 166,733 | | COST OF REVENUES | 36,115 | 33,481 | | GROSS PROFIT | 137,361 | 133,252 | | TOTAL OPERATING EXPENSES | 98,862 | 96,846 | | OPERATIONS INCOME | 38,499 | 36,406 | | INCOME BEFORE INCOME TAXES | 53,420 | 53,080 | | NET INCOME | 44,943 | 47,514 | | Diluted EPS | 0.68 | 0.55 | Condensed Consolidated Balance Sheets The condensed consolidated balance sheets present InMode's financial position as of June 30, 2025, compared to December 31, 2024, detailing assets, liabilities, and shareholders' equity Condensed Consolidated Balance Sheets (June 30, 2025 vs Dec 31, 2024) | Metric (USD thousands) | June 30, 2025 | Dec 31, 2024 | | :--------------------- | :------------ | :----------- | | TOTAL CURRENT ASSETS | 638,781 | 714,452 | | TOTAL NON-CURRENT ASSETS | 69,567 | 71,215 | | TOTAL ASSETS | 708,348 | 785,667 | | TOTAL CURRENT LIABILITIES | 66,534 | 69,851 | | TOTAL NON-CURRENT LIABILITIES | 13,377 | 12,003 | | TOTAL LIABILITIES | 79,911 | 81,854 | | TOTAL SHAREHOLDERS' EQUITY | 628,437 | 703,813 | Condensed Consolidated Statements of Cash Flows The condensed consolidated statements of cash flows outline the cash generated from or used in operating, investing, and financing activities for the three and six months ended June 30, 2025, compared to the same periods in 2024 Condensed Consolidated Statements of Cash Flows (Q2 2025 vs Q2 2024) | Metric (USD thousands) | Q2 2025 | Q2 2024 | | :--------------------- | :------ | :------ | | Net cash provided by operating activities | 24,072 | 42,059 | | Net cash provided by (used in) investing activities | 71,656 | 17,725 | | Net cash used in financing activities | (26,979) | (88,585) | | NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 70,289 | (28,933) | | CASH AND CASH EQUIVALENTS AT END OF PERIOD | 216,237 | 91,997 | Condensed Consolidated Statements of Cash Flows (Six Months Ended June 30, 2025 vs 2024) | Metric (USD thousands) | 6M 2025 | 6M 2024 | | :--------------------- | :------ | :------ | | Net cash provided by operating activities | 38,116 | 66,173 | | Net cash provided by (used in) investing activities | 147,141 | (29,665) | | Net cash used in financing activities | (126,445) | (88,351) | | NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 60,908 | (52,414) | | CASH AND CASH EQUIVALENTS AT END OF PERIOD | 216,237 | 91,997 | Revenue Breakdown by Category and Technology Revenues by Category In Q2 2025, Capital Equipment revenues constituted 79% of total revenues, increasing to $75.8 million from $65.4 million in Q2 2024, while Consumables and service revenues decreased by 6% to $19.8 million, representing 21% of total revenues Q2 2025 Revenues by Category (USD thousands) | Category | Q2 2025 Revenue | % of Total | Q2 2024 Revenue | % of Total | YoY Change | | :------- | :-------------- | :--------- | :-------------- | :--------- | :--------- | | Capital Equipment revenues - United States | 40,653 | 42% | 34,799 | 41% | +16.8% | | Capital Equipment revenues - International | 35,133 | 37% | 30,606 | 35% | +14.8% | | Total Capital Equipment revenues | 75,786 | 79% | 65,405 | 76% | +15.9% | | Consumables and service revenues | 19,816 | 21% | 21,044 | 24% | -5.8% | | Total Revenue | 95,602 | 100% | 86,449 | 100% | +10.6% | Revenues by Technology For Q2 2025, Minimal Invasive technology accounted for 78% of total revenues, while Hands-Free and Non-Invasive technologies contributed 3% and 19% respectively, with a notable shift in Non-Invasive revenue share, increasing from 6% in Q2 2024 to 19% in Q2 2025 Q2 2025 Revenues by Technology (% of Total) | Technology | Q2 2025 Total % | Q2 2024 Total % | Change (pp) | | :--------- | :-------------- | :-------------- | :---------- | | Minimal Invasive | 78% | 87% | -9 | | Hands-Free | 3% | 7% | -4 | | Non Invasive | 19% | 6% | +13 | GAAP to Non-GAAP Reconciliation Three Months Ended June 30, 2025 and 2024 This section provides a detailed reconciliation of GAAP to non-GAAP condensed consolidated statements of income for the three months ended June 30, 2025 and 2024, primarily adjusting for share-based compensation and related tax effects Q2 2025 GAAP to Non-GAAP Reconciliation (USD thousands) | Metric | GAAP (Q2 2025) | Share Based Compensation | Non-GAAP (Q2 2025) | | :----- | :------------- | :----------------------- | :----------------- | | REVENUES | 95,602 | - | 95,602 | | GROSS PROFIT | 76,450 | 334 | 76,784 | | OPERATIONS INCOME | 22,881 | 3,418 | 26,299 | | NET INCOME | 26,742 | 3,397 | 30,139 | | Diluted EPS | 0.42 | | 0.47 | Q2 2024 GAAP to Non-GAAP Reconciliation (USD thousands) | Metric | GAAP (Q2 2024) | Share Based Compensation | Non-GAAP (Q2 2024) | | :----- | :------------- | :----------------------- | :----------------- | | REVENUES | 86,449 | - | 86,449 | | GROSS PROFIT | 69,333 | 471 | 69,804 | | OPERATIONS INCOME | 18,314 | 5,158 | 23,472 | | NET INCOME | 23,818 | 5,158 | 28,976 | | Diluted EPS | 0.28 | | 0.34 | Six Months Ended June 30, 2025 and 2024 This section details the reconciliation of GAAP to non-GAAP condensed consolidated statements of income for the six months ended June 30, 2025 and 2024, primarily adjusting for share-based compensation and related tax effects 6M 2025 GAAP to Non-GAAP Reconciliation (USD thousands) | Metric | GAAP (6M 2025) | Share Based Compensation | Non-GAAP (6M 2025) | | :----- | :------------- | :----------------------- | :----------------- | | REVENUES | 173,476 | - | 173,476 | | GROSS PROFIT | 137,361 | 644 | 138,005 | | OPERATIONS INCOME | 38,499 | 5,936 | 44,435 | | NET INCOME | 44,943 | 6,591 | 51,534 | | Diluted EPS | 0.68 | | 0.77 | 6M 2024 GAAP to Non-GAAP Reconciliation (USD thousands) | Metric | GAAP (6M 2024) | Share Based Compensation | Non-GAAP (6M 2024) | | :----- | :------------- | :----------------------- | :----------------- | | REVENUES | 166,733 | - | 166,733 | | GROSS PROFIT | 133,252 | 880 | 134,132 | | OPERATIONS INCOME | 36,406 | 9,141 | 45,547 | | NET INCOME | 47,514 | 9,141 | 56,655 | | Diluted EPS | 0.55 | | 0.65 |