Allurion Technologies’ Earnings Call: Growth Amid Challenges

Allurion Technologies, Inc. ((ALUR)) has held its Q4 earnings call. Read on for the main highlights of the call.

The recent earnings call of Allurion Technologies, Inc. presented a balanced perspective, highlighting both achievements and challenges. The company reported significant growth in procedure volumes and successful results from combination therapy trials, alongside operational restructuring that led to reduced expenses. However, these positive developments were tempered by declines in revenue and gross profit margins, as well as a notable loss from operations.

Procedure Volume Growth

In 2024, Allurion Technologies experienced a 4% growth in procedure volumes, surpassing previous guidance. This increase is attributed to patients entering the treatment funnel after discontinuing GLP-1 medications, showcasing the company’s ability to adapt to changing patient needs and market conditions.

Operating Expense Reduction

The company successfully reduced its operating expenses by 39% in Q4 2024 compared to the previous year. This significant decrease is a result of effective restructuring and reorganization initiatives, highlighting Allurion’s commitment to improving operational efficiency.

Successful Combination Therapy

Promising results were reported from studies on the Allurion Balloon combined with low-dose GLP-1s. This combination led to significant weight loss and muscle mass preservation, marking a potential breakthrough in treatment options and enhancing the company’s product offerings.

Commercial Plan Progress

Allurion made significant strides in implementing a new commercial plan, focusing on key geographies and a B2B2C sales model. Procedure volumes in pilot accounts are expected to increase by over 30% in Q1 2025 compared to Q4 2024, indicating positive momentum in the company’s commercial strategy.

Resumption of Sales in France

Following regulatory clearance, sales in France have resumed, with plans to reengage with clinics to better serve patients. This development is expected to contribute positively to the company’s revenue streams moving forward.

Revenue Decline

Despite positive developments, Allurion reported a revenue decline in Q4 2024, with figures dropping to $5.6 million from $8.2 million in Q4 2023. This decrease was primarily due to the temporary suspension of sales in France and broader macroeconomic challenges.

Gross Profit Margin Decrease

The gross profit margin for Q4 2024 was 45% of revenue, down from 78% in Q4 2023. This decline was influenced by reduced revenue and lower production volumes, reflecting the challenges faced by the company in maintaining profitability.

Loss from Operations

Allurion reported a loss from operations of $17.1 million for Q4 2024, an improvement from $25.7 million in Q4 2023. While the loss remains significant, the reduction indicates progress in the company’s efforts to improve its financial health.

Forward-Looking Guidance

Looking ahead, Allurion Technologies is focusing on a new commercial strategy with a B2B2C approach and plans to expand its sales team in 2025. The company expects operating expenses to decrease by approximately 50% in 2025, with targeted revenues of around $30 million. Allurion aims to achieve profitability for its ex-US business by the end of 2025 and is working towards securing FDA approval for its Allurion Balloon. These strategic initiatives are expected to drive growth and efficiency as the company pursues its long-term objectives.

In summary, Allurion Technologies’ earnings call highlighted a mix of achievements and challenges. While the company reported growth in procedure volumes and successful combination therapy results, it also faced revenue declines and operational losses. The forward-looking guidance suggests a strategic focus on commercial expansion and operational efficiency, with the aim of achieving profitability and long-term growth.