AngioDynamics(ANGO) - 2026 Q3 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Revenue increased by 8.9% to $78.4 million, driven by growth in both MedTech and Med Device segments [14] - Adjusted EBITDA improved to $1.8 million from $1.3 million year-over-year, attributed to MedTech revenue growth and operational efficiency initiatives [19] - Gross margin for Q3 FY 2026 was 52.9%, a decrease of 110 basis points from the previous year, primarily due to tariffs and inflation [17] Business Line Data and Key Metrics Changes - MedTech revenue reached $37.3 million, a 19% increase, comprising 48% of total revenue compared to 44% a year ago [14] - Auryon platform generated $16.3 million in revenue, growing 17.9% year-over-year, marking 19 consecutive quarters of double-digit growth [14][15] - Mechanical Thrombectomy revenue, including AngioVac and AlphaVac, increased by 17.9% to $11.5 million, with AlphaVac revenue growing 47.4% year-over-year [15] - NanoKnife revenue was $7.6 million, a 21% increase, driven by strong demand in prostate care [16] Market Data and Key Metrics Changes - The Med Device segment saw a modest increase of 1.1% year-over-year, with a year-to-date growth of 3% [16] - International traction for Auryon continued following CE Mark approval, indicating potential for market expansion [8] Company Strategy and Development Direction - The company is focused on driving profitable growth in high-margin MedTech markets, with a commitment to innovation and product development [5][12] - A strategic shift towards hospital markets is expected to enhance pricing power and customer relationships [41] - Continued investment in R&D is planned, targeting approximately 10% of sales to support long-term growth [18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's resilience despite macroeconomic challenges, including tariffs and inflation [7][20] - The company raised its full-year guidance for net sales and adjusted EBITDA for the third consecutive quarter, reflecting strong performance and market positioning [5][21] - Future cash flow is expected to remain positive, with substantial cash generation anticipated in the fourth fiscal quarter [22][24] Other Important Information - The company is planning to increase inventory levels in anticipation of temporary sterilization shutdowns, which may slightly impact cash flow [23] - The leadership transition process is underway, with a search committee formed to find a successor for the current CEO [26] Q&A Session Summary Question: Insights on AlphaVac's sequential growth and impact from PE guidelines - Management noted that growth is driven by increased hospital approvals and physician comfort with the product, expecting continued sequential growth [30] Question: Guidance considerations regarding energy costs and supplier pricing - Management confirmed that guidance accounts for inflationary pressures and tariffs, with some ability to raise prices based on product quality [33][34] Question: Future expectations for AlphaVac's revenue baseline - Management expects AlphaVac to continue growing sequentially, viewing current revenue as a strong driver for future growth [39] Question: Details on Auryon's performance in different care settings - Management highlighted a strategic shift towards hospital settings, which enhances pricing and volume, while also maintaining growth in outpatient settings [41][42] Question: Supply chain risks related to China and sterilization shutdowns - Management indicated minimal risk from China sourcing and noted that sterilization shutdowns are not expected to be a recurring issue, emphasizing strong cash management [48][50]