Align Technology(US:ALGN)2025-04-30 20:30Financial Data and Key Metrics Changes - Total revenues for Q1 2025 were $979.3 million, down 1.6% sequentially and down 1.8% year over year [18] - Q1 clear aligner revenues were $796.8 million, up 0.3% sequentially but down 2.5% year over year [18][20] - Q1 systems and services revenue was $182.4 million, down 9.2% sequentially but up 1.2% year over year [21] - Overall gross margin for Q1 was 69.5%, down 0.6 points sequentially and down 0.5 points year over year [22] - Q1 net income per diluted share was $1.27, down $0.13 sequentially and year over year [26][27] Business Line Data and Key Metrics Changes - Clear aligner volumes grew 6.2% year over year, with significant growth in the EMEA and APAC regions [6][7] - Systems and services revenues were slightly up year over year due to the adoption of the iTero Lumina scanner platform [6][21] - Q1 clear aligner average per case shipment price was $12.40, down $110 year over year due to product mix shifts and discounts [20] Market Data and Key Metrics Changes - North America saw a year-over-year increase in clear aligner volumes, driven by the adoption of Invisalign First and other products [7][9] - EMEA region volumes reflected strong demand across both orthodontic and GP channels [8] - APAC region growth was led by increased utilization in both ortho and GP channels across various markets [8] Company Strategy and Development Direction - The company is focused on innovation in orthodontics, including the launch of the Invisalign Pallet Expander and the iTero Lumina scanner with restorative capabilities [10][12] - Align Technology aims to enhance clinical outcomes and patient experiences through its digital platform and new product offerings [13][40] - The company is committed to expanding its market presence and improving operational efficiencies to drive growth [39][41] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of the clear aligner business despite global economic uncertainties [39] - The company anticipates Q2 2025 revenues to be in the range of $1.05 billion to $1.07 billion, indicating sequential growth [36] - Management highlighted the importance of digital workflows and the role of dental service organizations (DSOs) in driving growth [13][39] Other Important Information - The company received a favorable ruling regarding VAT applicability in the UK, which could enhance patient access to oral health [30] - Align Technology is actively managing tariff impacts through strategic production locations and supply chain adjustments [33][34] Q&A Session Summary Question: Strength in the quarter despite consumer sentiment decline - Management noted good volume growth across regions, particularly in North America, and highlighted the positive impact of new product launches [46][48] Question: Plans to mitigate tariff impacts - Management indicated confidence in their current production locations and supply chain strategies to mitigate tariff impacts [51][53] Question: Insights for the upcoming investor day - Management plans to provide a comprehensive overview of the company's technology and commercial positioning [55][56] Question: Clarification on 2025 revenue guidance and ASPs - Management confirmed that ASPs are expected to remain under pressure due to product mix shifts, but overall revenue growth is anticipated [58][60] Question: Performance of the teen segment - Management highlighted strong growth in the teen segment, driven by new products and effective distribution strategies [62][64] Question: ASP impacts from VAT and FX - Management discussed the potential for ASP improvements if the VAT situation in the UK is resolved favorably and noted that FX could become a positive contributor going forward [71][75]