Nevro Reports Fourth-Quarter and Full-Year 2023 Financial Results
Provides Full-Year and First-Quarter 2024 Guidance
"Our fourth quarter performance reflects continued execution of our three-pillar strategy initiated in the second quarter of 2023," said
"I especially want to thank our
Fourth-Quarter 2023 Financial Highlights and Recent Business Developments
- For the fourth quarter of 2023 (as compared with the fourth quarter of 2022):
- Worldwide revenue grew to
$116.2 million , an increase of 2% as reported and on a constant currency basis. - Painful Diabetic Neuropathy (PDN) Indication sales increased 29% to approximately $22.4 million.
U.S. trial procedures decreased approximately 1%, in line with the company's expectations; U.S. PDN trial procedures were 24% of totalU.S. trials.- Reported a fourth quarter 2023 net loss from operations of
$11.8 million ; fourth quarter 2023 adjusted EBITDA was$8.4 million . Refer to the financial table at the end of this release for GAAP to non-GAAP reconciliations, definitions and further information regarding the use of non-GAAP metrics.
- Worldwide revenue grew to
- As previously announced on
November 30, 2023 :- Nevro acquired Vyrsa Technologies™ (Vyrsa), a medical technology company focused on a minimally invasive treatment option for patients suffering from chronic sacroiliac joint (SI joint) pain.
- The company closed a 6-year,
$200 million term loan credit facility, the proceeds of which were used to repurchase the majority of the company's 2025 Convertible Notes, the acquisition of Vyrsa and for working capital and other general corporate purposes.
- Over 115,000 patients now globally treated with HFX 10 kHz Therapy™
- As previously announced on
January 9, 2024 , Nevro implemented a restructuring, including laying off 5% of its workforce, a vast majority of which affected internally focused employees and not customer-facing personnel in the field to support the company's long-term growth and profitability. - For the full-year and first-quarter of 2024, Nevro currently expects the following:
- Full-year 2024 revenue to be in the range of
$435 million to$445 million , or 2% to 5% growth on a reported and constant currency basis over 2023, and adjusted EBITDA to be in the range of negative$8 million to negative$14 million . - First-quarter 2024 revenue to be in the range of
$97 million to$99 million , representing 1% to 3% constant currency growth over 2023, and adjusted EBITDA guidance of negative$15 million to negative$16 million .
- Full-year 2024 revenue to be in the range of
Fourth-Quarter 2023 Financial Results
Worldwide revenue for the fourth quarter of 2023 was
International revenue in the fourth quarter of 2023 was
Gross profit for the fourth quarter of 2023 was
Operating expenses for the fourth quarter of 2023 were
Net loss from operations for the fourth quarter of 2023 was
Cash, cash equivalents, and short-term investments totaled
Full-Year 2023 Financial Results
Net loss from operations for the full year of 2023 was
Full-Year and First-Quarter 2024 Financial Guidance
For the first quarter of 2024, the company currently expects worldwide revenue of approximately
An investor presentation for the Company's fourth-quarter and full-year 2023 financial results is available in the "Investors" section of
Webcast and Conference Call Information
As previously announced,
A live webcast of this event, as well as an archived recording, will be available in the Investors section of
Internet Posting of Information
About
Headquartered in
Senza®, Senza II®, Senza Omnia®, and HFX iQ™ are the only SCS systems that deliver
SENZA, SENZA II, SENZA OMNIA, OMNIA, HF10, the HF10 logo, 10 kHz Therapy, HFX, the HFX logo, HFX iQ, the HFX iQ logo, HFX Algorithm, HFX CONNECT, the HFX Connect logo, HFX ACCESS, the HFX Access logo, HFX COACH, the HFX Coach logo, HFX CLOUD, the HFX Cloud logo, RELIEF MULTIPLIED, the X logo,
To learn more about
Forward-Looking Statements
In addition to historical information, this press release contains forward-looking statements reflecting the current beliefs and expectations of the company's management, made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including: our first quarter and updated full-year 2024 financial guidance; our belief that the actions we have taken further position us for success; and our belief that our focus on our three key strategic pillars will improve our commercial execution and deliver significant long-term shareholder return. These forward-looking statements are based upon information that is currently available to us or our current expectations, speak only as of the date hereof, and are subject to numerous risks and uncertainties, including our ability to successfully commercialize our products; our ability to manufacture our products to meet demand; the level and availability of third-party payor reimbursement for our products; our ability to effectively manage our anticipated growth and the costs and expenses of operating our business; our ability to protect our intellectual property rights and proprietary technologies; our ability to operate our business without infringing the intellectual property rights and proprietary technology of third parties; competition in our industry; additional capital and credit availability; our ability to successfully integrate any additive acquisitions we may make, including our acquisition of Vyrsa Technologies; our ability to attract and retain qualified personnel; our ability to accurately forecast financial and operating results; and product liability claims. These factors, together with those that are described in greater detail in our Annual Report on Form 10-K to be filed shortly after the date hereof, as well as any reports that we may file with the
Investor and Media Contact:
Vice President, Investor Relations & Corporate Communications
angeline.mccabe@nevro.com
Nevro Corp. |
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Three Months Ended |
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Year Ended |
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2023 |
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2022 |
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|
2023 |
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2022 |
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(unaudited) |
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|
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|
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Revenue |
|
$ |
116,176 |
|
|
$ |
113,844 |
|
|
$ |
425,174 |
|
|
$ |
406,365 |
|
Cost of revenue |
|
|
34,699 |
|
|
|
38,605 |
|
|
|
135,114 |
|
|
|
129,998 |
|
Gross profit |
|
|
81,477 |
|
|
|
75,239 |
|
|
|
290,060 |
|
|
|
276,367 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
|
12,420 |
|
|
|
13,947 |
|
|
|
54,418 |
|
|
|
53,065 |
|
Sales, general and administrative |
|
|
80,598 |
|
|
|
80,650 |
|
|
|
334,704 |
|
|
|
322,138 |
|
Amortization of intangibles |
|
|
246 |
|
|
|
— |
|
|
|
246 |
|
|
|
— |
|
Certain litigation charges (credits) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(105,000) |
|
Total operating expenses |
|
|
93,264 |
|
|
|
94,597 |
|
|
|
389,368 |
|
|
|
270,203 |
|
Income (loss) from operations |
|
|
(11,787) |
|
|
|
(19,358) |
|
|
|
(99,308) |
|
|
|
6,164 |
|
Other income (expense): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income (expense), net |
|
|
781 |
|
|
|
855 |
|
|
|
6,152 |
|
|
|
(2,411) |
|
Change in fair market value of |
|
|
(8,051) |
|
|
|
— |
|
|
|
(8,051) |
|
|
|
— |
|
Other income (expense), net |
|
|
(436) |
|
|
|
(333) |
|
|
|
(586) |
|
|
|
511 |
|
Gain on extinguishment of debt |
|
|
3,934 |
|
|
|
— |
|
|
|
3,934 |
|
|
|
— |
|
Income (loss) before income taxes |
|
|
(15,559) |
|
|
|
(18,836) |
|
|
|
(97,859) |
|
|
|
4,264 |
|
Provision for (benefit from) income taxes |
|
|
(6,578) |
|
|
|
356 |
|
|
|
(5,646) |
|
|
|
1,263 |
|
Net income (loss) |
|
|
(8,981) |
|
|
|
(19,192) |
|
|
|
(92,213) |
|
|
|
3,001 |
|
Changes in foreign currency |
|
|
1,087 |
|
|
|
1,626 |
|
|
|
1,164 |
|
|
|
(1,667) |
|
Changes in gains (losses) on short- |
|
|
821 |
|
|
|
321 |
|
|
|
1,687 |
|
|
|
(1,063) |
|
Net change in other comprehensive loss |
|
|
1,908 |
|
|
|
1,947 |
|
|
|
2,851 |
|
|
|
(2,730) |
|
Comprehensive income (loss) |
|
$ |
(7,073) |
|
|
$ |
(17,245) |
|
|
$ |
(89,362) |
|
|
$ |
271 |
|
Net income (loss) per common share |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
(0.25) |
|
|
$ |
(0.54) |
|
|
$ |
(2.56) |
|
|
$ |
0.08 |
|
Diluted |
|
$ |
(0.25) |
|
|
$ |
(0.54) |
|
|
$ |
(2.56) |
|
|
$ |
0.08 |
|
Weighted average shares used to |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Basic |
|
|
36,277,243 |
|
|
|
35,474,998 |
|
|
|
35,981,431 |
|
|
|
35,317,644 |
|
Diluted |
|
|
36,277,243 |
|
|
|
35,474,998 |
|
|
|
35,981,431 |
|
|
|
35,525,255 |
|
|
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2023 |
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|
2022 |
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Assets |
|
|
|
|
|
|
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Current assets |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
104,217 |
|
|
$ |
120,373 |
|
Short-term investments |
|
|
218,506 |
|
|
|
254,012 |
|
Accounts receivable, net |
|
|
79,377 |
|
|
|
78,930 |
|
Inventories, net |
|
|
118,676 |
|
|
|
99,638 |
|
Prepaid expenses and other current assets |
|
|
10,145 |
|
|
|
9,984 |
|
Total current assets |
|
|
530,921 |
|
|
|
562,937 |
|
Property and equipment, net |
|
|
24,568 |
|
|
|
22,271 |
|
Operating lease assets |
|
|
8,944 |
|
|
|
13,430 |
|
|
|
|
38,164 |
|
|
|
— |
|
Intangible assets, net |
|
|
27,354 |
|
|
|
— |
|
Other assets |
|
|
5,156 |
|
|
|
3,164 |
|
Restricted cash |
|
|
606 |
|
|
|
606 |
|
Total assets |
|
$ |
635,713 |
|
|
$ |
602,408 |
|
Liabilities and stockholders' equity |
|
|
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
22,520 |
|
|
$ |
26,849 |
|
Contingent liabilities, current portion |
|
|
9,836 |
|
|
|
— |
|
Accrued liabilities and other |
|
|
51,019 |
|
|
|
52,363 |
|
Total current liabilities |
|
|
83,375 |
|
|
|
79,212 |
|
Long-term debt |
|
|
211,471 |
|
|
|
186,867 |
|
Long-term operating lease liabilities |
|
|
4,634 |
|
|
|
10,296 |
|
Contingent liabilities, non-current portion |
|
|
12,257 |
|
|
|
— |
|
Warrant liability |
|
|
28,739 |
|
|
|
— |
|
Other long-term liabilities |
|
|
2,092 |
|
|
|
2,157 |
|
Total liabilities |
|
|
342,568 |
|
|
|
278,532 |
|
Stockholders' equity |
|
|
|
|
|
|
|
|
Common stock,
37,044,390 and 36,203,423 shares issued at and 2022, respectively; 36,361,474 and 35,520,507 shares
outstanding at |
|
|
36 |
|
|
|
35 |
|
Additional paid-in capital |
|
|
992,762 |
|
|
|
934,132 |
|
Accumulated other comprehensive loss |
|
|
(243) |
|
|
|
(3,094) |
|
Accumulated deficit |
|
|
(699,410) |
|
|
|
(607,197) |
|
Total stockholders' equity |
|
|
293,145 |
|
|
|
323,876 |
|
Total liabilities and stockholders' equity |
|
$ |
635,713 |
|
|
$ |
602,408 |
|
Nevro Corp. |
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The following table presents a reconciliation of GAAP net loss, as prepared in accordance with |
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Reconciliation of actual results: |
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Three Months Ended |
|
|
Year Ended |
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|
2023 |
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2022 |
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|
2023 |
|
|
2022 |
|
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|
|
(unaudited) |
|
|
|
|
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GAAP Net income (loss) |
|
$ |
(8,981) |
|
|
$ |
(19,192) |
|
|
$ |
(92,213) |
|
|
$ |
3,001 |
|
Non-GAAP Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest (income) expense, net |
|
|
(781) |
|
|
|
(855) |
|
|
|
(6,152) |
|
|
|
2,411 |
|
Provision for income taxes |
|
|
(6,578) |
|
|
|
356 |
|
|
|
(5,646) |
|
|
|
1,263 |
|
Depreciation and amortization |
|
|
1,869 |
|
|
|
1,563 |
|
|
|
6,885 |
|
|
|
6,343 |
|
Stock-based compensation expense and other equity |
|
|
15,533 |
|
|
|
14,806 |
|
|
|
58,782 |
|
|
|
56,798 |
|
Certain litigation charges (credits) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(105,000) |
|
Amortization of intangibles |
|
|
246 |
|
|
|
— |
|
|
|
246 |
|
|
|
— |
|
Change in fair market value of warrants |
|
|
8,051 |
|
|
|
— |
|
|
|
8,051 |
|
|
|
— |
|
Gain on extinguishment of debt |
|
|
(3,934) |
|
|
|
— |
|
|
|
(3,934) |
|
|
|
— |
|
Litigation related expenses |
|
|
2,941 |
|
|
|
1,176 |
|
|
|
15,913 |
|
|
|
10,689 |
|
Restructuring charges |
|
|
— |
|
|
|
705 |
|
|
|
373 |
|
|
|
705 |
|
Adjusted EBITDA |
|
$ |
8,366 |
|
|
$ |
(1,441) |
|
|
$ |
(17,695) |
|
|
$ |
(23,790) |
|
Reconciliation of guidance: |
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Three Months Ended |
|
|
Year Ended |
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March 31, 2024 |
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December 31, 2024 |
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|
(Low Case) |
|
|
(High Case) |
|
|
(Low Case) |
|
|
(High Case) |
|
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|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Net Loss |
|
$ |
(41,000) |
|
|
$ |
(40,000) |
|
|
$ |
(107,000) |
|
|
$ |
(101,000) |
|
Non-GAAP Adjustments |
|
|
25,000 |
|
|
|
25,000 |
|
|
|
93,000 |
|
|
|
93,000 |
|
Adjusted EBITDA |
|
$ |
(16,000) |
|
|
$ |
(15,000) |
|
|
$ |
(14,000) |
|
|
$ |
(8,000) |
|
Management uses certain non-GAAP financial measures, most specifically adjusted EBITDA, as a supplement to GAAP financial measures to further evaluate the Company's operating performance period over period, analyze the underlying business trends, assess performance relative to competitors and establish operational objectives.
Management believes it is important to provide investors with the same non-GAAP metrics it uses to evaluate the performance and underlying trends of the Company's business operations to facilitate comparisons to its historical operating results and evaluate the effectiveness of its operating strategies. Disclosure of these non-GAAP financial measures also facilitates comparisons of the Company's underlying operating performance with other companies in the industry that also supplement their GAAP results with non-GAAP financial measures.
EBITDA is a non-GAAP financial measure, which is calculated by adding interest income and expense, net; provision for income taxes; and depreciation and amortization to net income. In calculating non-GAAP adjusted EBITDA, the Company further adjusts for the following items:
- Stock-based compensation expense and other equity-related charges – The company excludes non-cash costs related to the Company's stock-based plans, which include stock options, restricted stock units and performance-based restricted stock units as these expenses do not require cash settlement from the Company. In the period ended
December 31, 2023 , the Company additionally excluded one-time equity-related charges of$1.9 million associated with the Vyrsa acquisition. - Certain litigation charges (credits) – The Company excludes certain non-recurring litigation charges (credits) associated with patent litigation legal judgement and settlement, which management considers not related to the underlying operating performance of the business.
- Amortization of intangibles – The Company excludes amortization of intangibles from the acquisition of businesses.
- Change in fair market value of warrants – The Company excludes the changes in the fair value of its warrant liability.
- Gain from extinguishment of debt – The Company excludes gains and losses from extinguishment of early debt repayment.
- Litigation-related expenses – The Company excludes legal and professional fees as well as charges and credits associated with certain legal matters, which management considers not related to the underlying operating performance of the business.
- Restructuring charges – The Company excludes charges incurred as a direct result of restructuring programs, such as salaries and other compensation-related expenses.
Full-year guidance excludes the impact of foreign currency fluctuations.
The non-GAAP financial measure should not be considered in isolation from, or as a replacement for, the most directly comparable GAAP financial measures, as it is not prepared in accordance with
Amounts may not add due to rounding.
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