SI-BONE(US:SIBN)2022-05-09 23:54Financial Data and Key Metrics Changes - Total revenue for Q1 2022 was $22.4 million, representing a growth of approximately 10% compared to Q1 2021 [16][31] - U.S. revenue was $20.4 million, increasing by 9% year-over-year, while international revenue was $2.1 million, up 24% year-over-year [31] - Gross margin for Q1 2022 was 87%, down from 89% in the prior year period, impacted by a decline in average selling price (ASP) and increased operational costs [32] - Operating expenses increased by 22% to $36.3 million compared to $29.8 million in the prior year [32] - Net loss for Q1 2022 was $17.4 million, or $0.52 per diluted share, compared to a net loss of $12.2 million, or $0.37 per diluted share in the prior year [34] Business Line Data and Key Metrics Changes - The company experienced the highest monthly procedure volumes in its history in March 2022, despite COVID disruptions in January and February [16] - Approximately 160 U.S. procedures were deferred due to Omicron in Q1 2022, impacting revenue by over $1.4 million [17] - The sales team comprised 154 individuals at the end of Q1 2022, including 88 territory managers and 66 clinical support specialists [19] - The number of active surgeons performing at least one procedure in Q1 2022 grew by 17% year-over-year, totaling over 680 active surgeons [22] Market Data and Key Metrics Changes - The company increased its market share of sacropelvic surgical devices into the high 60% range, confirming the effectiveness of its product strategy [25] - The company is targeting a $250 million adjacent adult deformity market with the introduction of the iFuse Bedrock Granite product [15][63] Company Strategy and Development Direction - The company aims to extend its leadership position and drive long-term growth through sales infrastructure expansion and surgeon engagement initiatives [19][24] - The introduction of iFuse Granite is expected to enhance competitive positioning and accelerate growth in the adult deformity market [15][63] - The company is focusing on expanding its academic programs to educate surgical residents and fellows, having held approximately 175 academic programs to date [24] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the recovery in procedure volumes and the potential for continued growth, despite macro uncertainties related to COVID-19 [35][44] - The company is maintaining its 2022 total revenue guidance of approximately $106 million to $108 million, representing growth of 18% to 20% compared to 2021 [35] - Management highlighted the importance of the Breakthrough Device Designation and proposed NTAP for iFuse Granite in driving future growth [12][84] Other Important Information - The company is investing in direct-to-patient marketing initiatives to increase awareness among patients suffering from chronic SI joint pain [28][91] - The company is focused on derisking its supply chain to ensure the availability of instruments and implants to support top-line growth [53] Q&A Session Summary Question: Growth guidance for the year - Management maintained the growth guidance due to macro uncertainties but expressed confidence in sequential growth based on recovery trends and investments made [40][44] Question: Operating expenses and inflationary costs - Management explained that the increase in operating expenses was due to planned investments in sales force expansion and R&D, along with inflationary pressures [45][46] Question: Gross margins and factors affecting them - Management detailed that gross margin compression was due to product mix, site of service mix, and increased operational costs, while maintaining a focus on high industry-leading margins [50][53] Question: Potential impact of iFuse Granite on commercial adoption - Management expressed optimism about the potential for iFuse Granite to accelerate adoption and drive growth in the adult deformity market [63][64] Question: Backlog and deferred cases - Management noted that while there is a backlog of deferred cases, they have not included potential revenue from this backlog in their guidance due to uncertainty [66][68] Question: Active surgeon count and productivity - Management confirmed a slight decrease in active surgeons quarter-over-quarter but noted a year-over-year increase, indicating strong retention and engagement [76][77] Question: Market opportunity for TORQ and trauma applications - Management highlighted the significant market opportunity for TORQ in trauma applications and ongoing investments to educate trauma surgeons [87]