InMode Reports Second Quarter 2023 Financial Results; Record Quarterly Revenue of $136.1M Represents 20% Year-Over-Year Growth
YOKNEAM, Israel, July 27, 2023 /PRNewswire/ -- InMode Ltd. (NASDAQ:INMD) ("InMode"), a leading global provider of innovative medical technologies, today announced its consolidated financial results for the second quarter ended June 30, 2023.
Second Quarter 2023 Highlights:
- Record quarterly revenue of $136.1 million, an increase of 20% compared to the second quarter of 2022. InMode's proprietary surgical technology platforms engaged in minimally invasive and subdermal ablative treatments represented 81% of quarterly revenues, while 9% came from InMode's hands-free platforms and 10% from InMode's traditional laser and non-invasive RF platforms.
- Record GAAP net income of $55.7 million, compared to $44.0 million in the second quarter of 2022; *non-GAAP net income of $62.2 million, compared to $50.4 million in the second quarter of 2022.
- Record GAAP diluted earnings per share of $0.65, compared to $0.52 in the second quarter of 2022; *non-GAAP diluted earnings per share of $0.72, compared to $0.59 in the second quarter of 2022.
- Record quarterly revenues from consumables and service of $21.6 million, an increase of 44% compared to the second quarter of 2022.
- Total cash position of $629.4 million as of June 30, 2023, including cash and cash equivalents, marketable securities, and short-term bank deposits.
U.S. GAAP Results (U.S. dollars in thousands, except for per share data) | ||
Q2 2023 | Q2 2022 | |
Revenues | $136,081 | $113,547 |
Gross Margins | 84 % | 83 % |
Net Income | $55,729 | $44,048 |
Earnings per Diluted Share | $0.65 | $0.52 |
*Non-GAAP Results (U.S. dollars in thousands, except for per share data) | ||
Q2 2023 | Q2 2022 | |
Gross Margins | 84 % | 84 % |
Net Income | $62,234 | $50,401 |
Earnings per Diluted Share | $0.72 | $0.59 |
*Please refer to "Use of Non-GAAP Financial Measures" below for important information about non-GAAP financial measures. A reconciliation between U.S. GAAP and non-GAAP Statement of Income is provided following the financial statements that are included in this release. Non-GAAP results exclude share-based compensation adjustments.
Management Comments
"We are pleased to report a record quarter with revenue of $136.1 million, as sales from our platforms and disposables were the strongest they've ever been," said Moshe Mizrahy, Chairman and Chief Executive Officer. "Our commitment to innovation supports our growth and leads to a solid brand recognition within the aesthetics industry."
Shakil Lakhani, President of InMode North America, commented, "Once again, we saw an increase in consumable and platform sales in the second quarter. Revenue from consumables and service for the second quarter grew nearly 44% year-over-year and reached a record level."
"InMode's Envision platform, which offers a full periorbital treatment, continued to perform well in Q2, as we gained market traction stemming from the soft launch in Canada last year," said Dr. Spero Theodorou, Chief Medical Officer.
Second Quarter 2023 Financial Results
Total revenues for the second quarter of 2023 reached $136.1 million, an increase of 20% compared to the second quarter of 2022.
"We are happy to deliver another strong quarter, with record revenue and EPS in Q2," said Yair Malca, Chief Financial Officer. "Our significant international sales growth reached a record level of $49.5 million, and along with the expanded use of InMode's platforms, we were able to increase our full-year guidance."
GAAP gross margin for the second quarter of 2023 was 84% compared to a gross margin of 83% 2022. *Non-GAAP gross margin for the second quarter of 2023 and 2022 was 84%.
GAAP operating margin for the second quarter of 2023 was 42%, compared to an operating margin of 43% in the second quarter of 2022. *Non-GAAP operating margin for the second quarter of 2023 was 47% compared to 49% for the second quarter of 2022. This slight decrease was primarily attributable to higher sales and marketing expenses, mainly because of the addition of new sales representatives, higher travel expenses, as well as investment in direct-to-consumer advertising campaigns and hosting in-person events to support the company's growth projections.
InMode reported GAAP net income of $55.7 million, or $0.65 per diluted share, in the second quarter of 2023, compared to $44.0 million, or $0.52 per diluted share, in the second quarter of 2022. On a *non-GAAP basis, InMode reported net income of $62.2 million, or $0.72 per diluted share, in the second quarter of 2023, compared to $50.4 million, or $0.59 per diluted share, in the second quarter of 2022.
2023 Financial Outlook
Management provided an outlook for the full year of 2023 ending December 31, 2023. Based on current estimates, management expects:
- Revenue between $530 million and $540 million
- *Non-GAAP gross margin between 83% and 85%
- *Non-GAAP income from operations between $238 million and $243 million
- *Non-GAAP earnings per diluted share between $2.62 and $2.66
This outlook is not a guarantee of future performance and stockholders should not rely on such forward-looking statements. See "Forward-Looking Statements" for additional information.
*Please refer to "Use of Non-GAAP Financial Measures" below for important information about non-GAAP financial measures. A reconciliation between U.S. GAAP and non-GAAP Statement of Income is provided following the financial statements that are included in this release. Non-GAAP results exclude share-based compensation adjustments.
Use of Non-GAAP Financial Measures
In addition to InMode's operating results presented in accordance with GAAP, this release contains certain non-GAAP financial measures including non-GAAP net income, non-GAAP earnings per diluted share, and non-GAAP operating margin. Because these measures are used in InMode's internal analysis of financial and operating performance, management believes they provide investors with greater transparency of its view of InMode's economic performance. Management also believes the presentation of these measures, when analyzed in conjunction with InMode's GAAP operating results, allows investors to more effectively evaluate and compare InMode's performance to that of its peers, although InMode's presentation of its non-GAAP measures may not be strictly comparable to the similarly titled measures of other companies. Schedules reconciling each of these non-GAAP financial measures are provided as a supplement to this release.
Conference Call Information
Mr. Moshe Mizrahy, Chairman and Chief Executive Officer, Dr. Michael Kreindel, Co-Founder and Chief Technology Officer, Mr. Yair Malca, Chief Financial Officer, Mr. Shakil Lakhani, President of North America, and Dr. Spero Theodorou, Chief Medical Officer, will host a conference call today, July 27, 2023, at 8:30 a.m. Eastern Time to discuss the second quarter 2023 financial results.
The Company encourages participants to pre-register for the conference call using the following link:
https://dpregister.com/sreg/10180180/f9c680d37c.
Callers will receive a unique dial-in number upon registration, which enables immediate access to the call. Participants may pre-register at any time, including up to and after the call start time.
For callers who opt out of pre-registration, please dial one of the following teleconferencing numbers. Please begin by placing your call 10 minutes before the conference call commences. If you are unable to connect using the toll-free number, please try the international dial-in number.
U.S. Toll-Free Dial-in Number: 1-833-316-0562
Israel Toll- Free Dial-in Number: 1-80-921-2373
International Dial-in Number: 1-412-317-5736
Webcast URL: https://event.choruscall.com/mediaframe/webcast.html?webcastid=hAHIxqyf
At:
8:30 a.m. Eastern Time
5:30 a.m. Pacific Time
3:30 p.m. Israel Time
The conference call will also be webcast live from a link on InMode's website at https://inmodemd.com/investors/events-presentations/. A replay of the conference call will be available from July 27, 2023, at 12 p.m. Eastern Time to Aug 10, 2023, at 11:59 p.m. Eastern Time. To access the replay, please dial one of the following numbers:
Replay Dial-in U.S TOLL-FREE: 1-877-344-7529
Replay Dial-in Canada TOLL-FREE: 855-669-9658
Replay Dial-in TOLL/INTERNATIONAL: 1-412-317-0088
Replay Pin Number: 3384563
To access the replay using an international dial-in number, please select the link below:
https://services.choruscall.com/ccforms/replay.html
A replay of the conference call will also be available for 90 days on InMode's website at https://inmodemd.com/investors/.
About InMode
InMode is a leading global provider of innovative medical technologies. InMode develops, manufactures and markets devices harnessing novel radio frequency ("RF") technology. InMode strives to enable new emerging surgical procedures as well as improve existing treatments. InMode has leveraged its medically accepted minimally invasive RF technologies to offer a comprehensive line of products across several categories for plastic surgery, gynecology, dermatology, otolaryngology, and ophthalmology. For more information about InMode, please visit www.inmodemd.com.
Forward-Looking Statements
The information in this press release includes forward-looking statements within the meaning of the federal securities laws. These statements generally relate to future events or InMode's future financial or operating performance, including the future performance described above under the heading titled "2023 Financial Outlook." Actual outcomes and results may differ materially from what is expressed or forecast in such forward-looking statements. In some cases, you can identify these statements because they contain words such as "anticipate," "believe," "estimate," "expect," "intend," "may," "plan," "predict," "project," "will," "would" and similar expressions that concern our expectations, strategic plans or intentions. Forward-looking statements are based on management's current expectations and assumptions, and are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict, including with respect to the impact of the COVID-19 global outbreak. Consequently, actual results could differ materially from those indicated in these forward-looking statements. When considering these forward-looking statements, you should keep in mind the risk factors and other cautionary statements included in InMode's Annual Report on Form 20-F filed with the Securities and Exchange Commission on February 14, 2023, as well as risk factors relating to the COVID-19 global outbreak and our future public filings. InMode undertakes no obligation and does not intend to update these forward-looking statements to reflect events or circumstances occurring after this press release. You are cautioned not to place undue reliance on these forward-looking statements, which pertain only as of the date of this press release.
Company Contact: Yair Malca Chief Financial Officer Phone: (949) 305-0108 Email: [email protected] | Investor Relations Contact: Miri Segal MS-IR LLC Phone: (917) 607-8654 Email: [email protected] |
INMODE LTD. | |||||
CONDENSED CONSOLIDATED STATEMENTS OF INCOME | |||||
(U.S. dollars in thousands, except for per share data) | |||||
(Unaudited) | |||||
Three months ended | Six months ended | ||||
2023 | 2022 | 2023 | 2022 | ||
REVENUES | 136,081 | 113,547 | 242,155 | 199,468 | |
COST OF REVENUES | 22,054 | 18,946 | 40,308 | 33,718 | |
GROSS PROFIT | 114,027 | 94,601 | 201,847 | 165,750 | |
OPERATING EXPENSES: | |||||
Research and development | 3,567 | 3,183 | 6,669 | 5,998 | |
Sales and marketing | 51,059 | 39,653 | 92,772 | 70,502 | |
General and administrative | 2,392 | 2,562 | 4,400 | 5,039 | |
TOTAL OPERATING EXPENSES | 57,018 | 45,398 | 103,841 | 81,539 | |
INCOME FROM OPERATIONS | 57,009 | 49,203 | 98,006 | 84,211 | |
Finance income (expense), net | 4,445 | (918) | 7,734 | (539) | |
INCOME BEFORE TAXES | 61,454 | 48,285 | 105,740 | 83,672 | |
INCOME TAXES | 5,725 | 4,237 | 9,506 | 8,649 | |
NET INCOME | 55,729 | 44,048 | 96,234 | 75,023 | |
NET INCOME PER SHARE: | |||||
Basic | 0.67 | 0.54 | 1.16 | 0.91 | |
Diluted | 0.65 | 0.52 | 1.12 | 0.88 | |
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING USED IN | |||||
Basic | 83,405 | 82,216 | 83,280 | 82,590 | |
Diluted | 85,650 | 84,663 | 85,579 | 85,236 | |
INMODE LTD. | ||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
(U.S. dollars in thousands, except for per share data) | ||
(Unaudited) | ||
June 30, 2023 | December 31, 2022 | |
Assets | ||
CURRENT ASSETS: | ||
Cash and cash equivalents | 159,855 | 97,540 |
Marketable securities | 400,464 | 374,589 |
Short-term bank deposits | 69,094 | 75,254 |
Accounts receivable, net of allowance for doubtful accounts | 32,568 | 26,997 |
Other receivables | 18,656 | 15,094 |
Inventories | 38,568 | 39,897 |
TOTAL CURRENT ASSETS | 719,205 | 629,371 |
NON-CURRENT ASSETS: | ||
Accounts receivable, net of allowance for doubtful accounts | 3,871 | 3,973 |
Deferred income tax asset, net | 2,350 | 3,094 |
Operating lease right-of-use assets | 5,595 | 5,073 |
Property and equipment, net | 2,463 | 2,298 |
Other investments | 600 | 600 |
TOTAL NON-CURRENT ASSETS | 14,879 | 15,038 |
TOTAL ASSETS | 734,084 | 644,409 |
Liabilities and shareholders' equity | ||
CURRENT LIABILITIES: | ||
Accounts payable | 13,295 | 16,242 |
Contract liabilities | 11,098 | 13,798 |
Other liabilities | 36,340 | 51,980 |
TOTAL CURRENT LIABILITIES | 60,733 | 82,020 |
NON-CURRENT LIABILITIES: | ||
Contract liabilities | 3,038 | 3,959 |
Other liabilities | 533 | 303 |
Operating lease liabilities | 3,622 | 3,509 |
TOTAL NON-CURRENT LIABILITIES | 7,193 | 7,771 |
TOTAL LIABILITIES | 67,926 | 89,791 |
TOTAL SHAREHOLDERS' EQUITY | 666,158 | 554,618 |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | 734,084 | 644,409 |
INMODE LTD. | ||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||
(U.S. dollars in thousands, except for per share data) | ||||||
(Unaudited) | ||||||
Three months ended | Six months ended | |||||
2023 | 2022 | 2023 | 2022 | |||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||
Net income | 55,729 | 44,048 | 96,234 | 75,023 | ||
Adjustments required to reconcile net income to net cash provided by operating activities: | ||||||
Depreciation and amortization | 184 | 155 | 372 | 293 | ||
Share-based compensation expenses | 6,505 | 6,353 | 10,714 | 9,447 | ||
Allowance for doubtful accounts | 261 | 142 | 239 | 352 | ||
Loss on marketable securities, net | - | 23 | - | 37 | ||
Finance expenses (income), net | (1,197) | 851 | (2,709) | 941 | ||
Deferred income taxes, net | 43 | 169 | 62 | 147 | ||
Changes in operating assets and liabilities: | ||||||
Increase in accounts receivable | (7,949) | (8,247) | (5,708) | (4,294) | ||
Increase in other receivables | (3,791) | (398) | (4,020) | (1,593) | ||
Decrease (increase) in inventories | 2,243 | (4,660) | 1,329 | (8,734) | ||
Increase (decrease) in accounts payable | 1,308 | 2,292 | (2,947) | 3,054 | ||
Increase (decrease) in other liabilities | 7,211 | 4,105 | (15,832) | (770) | ||
Increase (decrease) in contract liabilities | (7,547) | 2,148 | (3,621) | 4,931 | ||
Net cash provided by operating activities | 53,000 | 46,981 | 74,113 | 78,834 | ||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||
Investment in short-term deposits | (100,000) | (22,500) | (106,000) | (45,611) | ||
Proceeds from short-term deposits | 106,500 | 23,000 | 112,500 | 43,000 | ||
Purchase of fixed assets | (194) | (561) | (535) | (860) | ||
Purchase of marketable securities | (54,190) | (17,545) | (172,542) | (38,754) | ||
Proceeds from sale of marketable securities | - | 1,008 | - | 2,002 | ||
Proceeds from maturity of marketable securities | 60,891 | 14,224 | 152,028 | 25,157 | ||
Net cash provided by (used in) investing activities | 13,007 | (2,374) | (14,549) | (15,066) | ||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||
Repurchase of ordinary shares | - | - | - | (42,637) | ||
Exercise of options | 827 | 204 | 2,500 | 365 | ||
Net cash provided by (used in) financing activities | 827 | 204 | 2,500 | (42,272) | ||
EFFECT OF EXCHANGE RATE CHANGES ON CASH | 60 | (1,077) | 251 | (1,228) | ||
NET INCREASE IN CASH AND CASH EQUIVALENTS | 66,894 | 43,734 | 62,315 | 20,268 | ||
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 92,961 | 44,670 | 97,540 | 68,136 | ||
CASH AND CASH EQUIVALENTS AT END OF PERIOD | 159,855 | 88,404 | 159,855 | 88,404 | ||
INMODE LTD. | |||||||||||
CONDENSED CONSOLIDATED FINANCIAL HIGHLIGHTS | |||||||||||
(U.S. dollars in thousands, except for per share data) | |||||||||||
(Unaudited) | |||||||||||
Three months ended June 30, | Six months ended June 30, | ||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||
Revenues by Category: | |||||||||||
Capital Equipment revenues - United States | 73,828 | 54 % | 62,960 | 56 % | 123,579 | 51 % | 107,720 | 54 % | |||
Capital Equipment revenues - International | 40,635 | 30 % | 35,560 | 31 % | 77,008 | 32 % | 62,743 | 31 % | |||
Total Capital Equipment revenues | 114,463 | 84 % | 98,520 | 87 % | 200,587 | 83 % | 170,463 | 85 % | |||
Consumables and service revenues | 21,618 | 16 % | 15,027 | 13 % | 41,568 | 17 % | 29,005 | 15 % | |||
Total Net Revenue | 136,081 | 100 % | 113,547 | 100 % | 242,155 | 100 % | 199,468 | 100 % | |||
Three months ended June 30, | Six months ended June 30, | |||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||
% | % | % | % | |||||||||
United States | International | Total | United States | International | Total | United States | International | Total | United States | International | Total | |
Revenues by Technology: | ||||||||||||
Minimal-Invasive | 86 | 73 | 81 | 84 | 74 | 80 | 88 | 74 | 83 | 84 | 72 | 79 |
Hands-Free | 11 | 6 | 9 | 14 | 5 | 11 | 10 | 6 | 8 | 13 | 6 | 11 |
Non-Invasive | 3 | 21 | 10 | 2 | 21 | 9 | 2 | 20 | 9 | 3 | 22 | 10 |
100 | 100 | 100 | 100 | 100 | 100 | 100 | 100 | 100 | 100 | 100 | 100 | |
INMODE LTD. | |||||||||||||||||
RECONCILIATION OF GAAP CONDENSED CONSOLIDATED STATEMENTS OF | |||||||||||||||||
INCOME TO NON-GAAP CONDENSED CONSOLIDATED STATEMENTS OF INCOME | |||||||||||||||||
(U.S. dollars in thousands, except for per share data) | |||||||||||||||||
(Unaudited) | |||||||||||||||||
Three months ended June 30, 2023 | Three months ended June 30, 2022 | ||||||||||||||||
GAAP | Share Based | Non-GAAP | GAAP | Share Based | Non-GAAP | ||||||||||||
REVENUES | 136,081 | - | 136,081 | 113,547 | - | 113,547 | |||||||||||
COST OF REVENUES | 22,054 | (547) | 21,507 | 18,946 | (496) | 18,450 | |||||||||||
GROSS PROFIT | 114,027 | 547 | 114,574 | 94,601 | 496 | 95,097 | |||||||||||
OPERATING EXPENSES: | |||||||||||||||||
Research and development | 3,567 | (757) | 2,810 | 3,183 | (866) | 2,317 | |||||||||||
Sales and marketing | 51,059 | (4,731) | 46,328 | 39,653 | (4,459) | 35,194 | |||||||||||
General and administrative | 2,392 | (470) | 1,922 | 2,562 | (532) | 2,030 | |||||||||||
TOTAL OPERATING | 57,018 | (5,958) | 51,060 | 45,398 | (5,857) | 39,541 | |||||||||||
INCOME FROM OPERATIONS | 57,009 | 6,505 | 63,514 | 49,203 | 6,353 | 55,556 | |||||||||||
Finance income (expense), net | 4,445 | - | 4,445 | (918) | - | (918) | |||||||||||
INCOME BEFORE TAXES | 61,454 | 6,505 | 67,959 | 48,285 | 6,353 | 54,638 | |||||||||||
INCOME TAXES | 5,725 | - | 5,725 | 4,237 | - | 4,237 | |||||||||||
NET INCOME | 55,729 | 6,505 | 62,234 | 44,048 | 6,353 | 50,401 | |||||||||||
NET INCOME PER SHARE: | |||||||||||||||||
Basic | 0.67 | 0.75 | 0.54 | 0.61 | |||||||||||||
Diluted | 0.65 | 0.72 | 0.52 | 0.59 | |||||||||||||
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING USED IN | |||||||||||||||||
Basic | 83,405 | 83,405 | 82,216 | 82,216 | |||||||||||||
Diluted | 85,650 | 86,243 | 84,663 | 85,366 | |||||||||||||
INMODE LTD. | ||||||
RECONCILIATION OF GAAP CONDENSED CONSOLIDATED STATEMENTS OF | ||||||
INCOME TO NON-GAAP CONDENSED CONSOLIDATED STATEMENTS OF INCOME | ||||||
(U.S. dollars in thousands, except for per share data) | ||||||
(Unaudited) | ||||||
Six months ended June 30, 2023 | Six months ended June 30, 2022 | |||||
GAAP | Share Based | Non-GAAP | GAAP | Share Based | Non-GAAP | |
REVENUES | 242,155 | - | 242,155 | 199,468 | - | 199,468 |
COST OF REVENUES | 40,308 | (901) | 39,407 | 33,718 | (810) | 32,908 |
GROSS PROFIT | 201,847 | 901 | 202,748 | 165,750 | 810 | 166,560 |
OPERATING EXPENSES: | ||||||
Research and development | 6,669 | (1,258) | 5,411 | 5,998 | (1,391) | 4,607 |
Sales and marketing | 92,772 | (7,769) | 85,003 | 70,502 | (6,354) | 64,148 |
General and administrative | 4,400 | (786) | 3,614 | 5,039 | (892) | 4,147 |
TOTAL OPERATING | 103,841 | (9,813) | 94,028 | 81,539 | (8,637) | 72,902 |
INCOME FROM OPERATIONS | 98,006 | 10,714 | 108,720 | 84,211 | 9,447 | 93,658 |
Finance income (expense),net | 7,734 | - | 7,734 | (539) | - | (539) |
INCOME BEFORE TAXES | 105,740 | 10,714 | 116,454 | 83,672 | 9,447 | 93,119 |
INCOME TAXES | 9,506 | - | 9,506 | 8,649 | - | 8,649 |
NET INCOME | 96,234 | 10,714 | 106,948 | 75,023 | 9,447 | 84,470 |
NET INCOME PER | ||||||
Basic | 1.16 | 1.28 | 0.91 | 1.02 | ||
Diluted | 1.12 | 1.24 | 0.88 | 0.98 | ||
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING USED IN | ||||||
Basic | 83,280 | 83,280 | 82,590 | 82,590 | ||
Diluted | 85,579 | 86,062 | 85,236 | 85,786 | ||
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SOURCE InMode LTD