Yahoo Finance Stereotaxis Inc (STXS) Q1 2024 Earnings Call Transcript Highlights: Navigating Growth and Challenges
Revenue: Q1 2024 totaled $6.9 million, up 5% from $6.5 million in Q1 2023.
System Revenue: $2.6 million in Q1 2024, up from $1.8 million in Q1 2023.
Recurring Revenue: $4.3 million in Q1 2024, down from $4.7 million in Q1 2023.
Gross Margin: 58% in Q1 2024; Recurring revenue gross margin at 76%, system gross margin at 27%.
Operating Expenses: $8.7 million in Q1 2024, including $2.6 million in non-cash stock compensation.
Net Loss: $4.5 million in Q1 2024, improved from $5.3 million in Q1 2023.
Free Cash Flow: Negative $2.3 million in Q1 2024.
Cash and Cash Equivalents: $18.2 million as of March 31, 2024, with no debt.
System Backlog: Increased to $16 million due to new Genesis robot orders.
Expected Revenue Growth: Modest double-digit growth anticipated for full-year 2024, excluding APT contributions.
Release Date: May 13, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
Revenue in the first quarter grew 5% over the previous year, driven by increased robotic system sales.
Stereotaxis Inc (STXS) successfully increased its system backlog with the receipt of two additional orders for Genesis robots from existing customers in Europe.
Significant regulatory progress with the proprietary ablation catheter submitted to the EU Notified Body and FDA, receiving responsive and collaborative feedback.
Development of a smaller cell-shielding robot is on track, with regulatory submissions expected soon, enhancing the accessibility of Stereotaxis Inc (STXS)'s technology.
The acquisition of APT is expected to bring in-house catheter development and manufacturing expertise, enhancing Stereotaxis Inc (STXS)'s innovation capabilities and potentially contributing approximately $5 million in annual revenue post-acquisition.
Negative Points
Recurring revenue remains impacted by Johnson & Johnson's catheter shortages, affecting procedure volumes and availability in various geographies.
The net impact of system revenue recognition in the first quarter has increased current backlog, indicating potential delays in revenue realization.
Operating loss and net loss for the first quarter of 2024 were $4.7 million and $4.5 million respectively, although improved from the previous year.
Negative free cash flow for the first quarter was $2.3 million, highlighting ongoing financial challenges.
The ramp-up in manufacturing of the guidewire is slightly slower than expected, potentially delaying regulatory submissions and commercial availability.
Q & A Highlights
Q: Can you discuss any immediate synergistic help APT can provide with current products in development like MAGiC and the guidewire? A: David Fischel, CEO of Stereotaxis, clarified that the acquisition of APT is not directly relevant for the MAGiC catheter or the guidewire at this stage. The focus is more on future developments, including the diagnostic EP catheter and other interventional devices.
Q: Could you provide more details on the switch from a PMA supplement to a full PMA for the MAGiC catheter? A: David Fischel explained that the FDA internally converted the submission from a PMA supplement to a traditional PMA to allow a more comprehensive review, including auditing manufacturing facilities. This conversion aligns with the FDA's requirements and does not significantly alter the timeline for submission.
Q: What updates can you provide on the capital equipment environment, particularly regarding installation timelines and ordering patterns? A: David Fischel noted that there are both challenges and tailwinds in the current environment. While there are macroeconomic and product ecosystem challenges, there is also strong interest and demand for Stereotaxis's technology. The company is balancing these factors as it progresses with its innovation strategy.
Q: How does the APT acquisition fit into Stereotaxis's technology platform, particularly regarding the integration of APT's catheters with existing systems? A: David Fischel mentioned that APT's catheters are compatible with a range of mapping systems and do not require full integration to be functional. This compatibility allows for flexibility in how their catheters can be used across different systems.
Q: Can you elaborate on the expected revenue contributions from APT and the timeline for these contributions? A: David Fischel projected that APT would contribute approximately $5 million in annual revenue during the first year post-acquisition. This figure is based on the initial months following the expected closure in the third quarter.
Q: Are there any pipeline initiatives from APT targeting pulsed field ablation (PFA), and how does Stereotaxis view the importance of adding PFA to its portfolio? A: David Fischel acknowledged that APT has engaged in some PFA work and holds relevant intellectual property. Stereotaxis is also exploring PFA with other companies and has planned animal studies to advance this initiative. The addition of PFA capabilities is seen as a significant enhancement to Stereotaxis's portfolio.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
