Si-Bone ((SIBN)) has held its Q1 earnings call. Read on for the main highlights of the call.
The recent earnings call for SI-BONE reflected a cautiously optimistic sentiment, underscored by strong revenue growth and increased physician engagement. While the company showcased impressive operational performance, challenges such as ongoing net losses, slow international revenue growth, and pending regulatory decisions were acknowledged. The overall tone was one of confidence in their strategic direction, tempered by an awareness of external conditions.
Strong Revenue Growth
SI-BONE reported worldwide revenue for the quarter reaching $47.3 million, marking an approximate 25% growth. U.S. revenue was particularly robust at $44.8 million, reflecting a 27% increase. This growth underscores the company’s successful expansion efforts and market penetration.
Positive Adjusted EBITDA
The company achieved a positive adjusted EBITDA of approximately $0.5 million, a significant turnaround from an adjusted EBITDA loss of $4 million in the first quarter of 2024. This improvement highlights SI-BONE’s effective cost management and operational efficiency.
Significant Increase in Physician Engagement
Over 1,400 U.S. physicians performed procedures using SI-BONE’s products, marking a 27% increase in the physician base. This growth in engagement is indicative of the company’s successful outreach and product acceptance among medical professionals.
New Product Launch and Development
SI-BONE is set to launch a new SI joint fusion solution in Q1 2026 and is developing a third breakthrough device targeting a pressing need in spine surgery. These innovations are expected to further strengthen the company’s product portfolio and market position.
Improved Gross Margins
The gross margin rate for the quarter was 79.7%, an improvement of nearly 80 basis points. This enhancement in margins reflects the company’s ability to optimize its cost structure and enhance profitability.
Increased Product Adoption
There was notable adoption of the iFuse Bedrock Granite 9.5, with a 69% growth in four implant Granite cases compared to the prior year. This indicates strong market acceptance and the effectiveness of SI-BONE’s product offerings.
Net Loss Narrowed but Still Present
The net loss narrowed to $6.5 million, or $0.15 per diluted share, compared to a net loss of $10.9 million, or $0.27 per diluted share. While the reduction in net loss is a positive sign, the company continues to face challenges in achieving profitability.
International Revenue Lagging
International revenue in the first quarter was only $2.5 million, indicating slower growth compared to the U.S. market. This highlights the need for SI-BONE to enhance its international strategy to capture more global market share.
Potential Impact of Macroeconomic Conditions
SI-BONE is mindful of macroeconomic conditions and has taken a prudent approach in their outlook for the year. This cautious stance reflects the company’s awareness of external economic factors that could impact its operations.
Pending Regulatory and Reimbursement Decisions
The company is awaiting decisions from CMS regarding the reassignment of Granite procedures to a higher severity reimbursement category. This pending decision could have significant implications for SI-BONE’s future revenue streams.
Forward-Looking Guidance
SI-BONE provided an optimistic outlook for the future, with updated full-year revenue guidance in the range of $193.5 million to $197.5 million, reflecting anticipated growth of 16% to 18%. The company expects an improvement in full-year gross margin expectations to 78% and is optimistic about reaching free cash flow by 2026. These projections underscore SI-BONE’s confidence in its strategic initiatives and growth potential.
In summary, SI-BONE’s earnings call conveyed a cautiously optimistic outlook, driven by strong revenue growth and increased physician engagement. While the company faces challenges such as ongoing net losses and slow international growth, its strategic initiatives and product innovations position it well for future success. Investors will be keenly watching how SI-BONE navigates external conditions and regulatory decisions in the coming quarters.