Shockwave Medical Reports Third Quarter 2023 Financial Results
SANTA CLARA, Calif., Nov. 06, 2023 (GLOBE NEWSWIRE) -- Shockwave Medical, Inc. (NASDAQ:SWAV), a pioneer in the development and commercialization of transformational technologies for the treatment of cardiovascular disease, today reported financial results for the three months ended September 30, 2023.
Recent Highlights
- Recognized revenue of $186.0 million for the third quarter of 2023, representing an increase of 42% from the same period in 2022
- Announced, priced and closed an offering for convertible debt, with net proceeds of $634.4 million
- Introduced the Shockwave C2+ Coronary Intravascular Lithotripsy (IVL) catheter at the 35th Transcatheter Cardiovascular Therapeutics (TCT) annual scientific symposium of the Cardiovascular Research Foundation
- Granted a Category I Current Procedural Terminology (CPT®) add-on code for procedures involving coronary Intravascular Lithotripsy (IVL) by the U.S. Centers for Medicare & Medicaid Services (CMS) as part of the Calendar Year 2024 Physician Fee Schedule (PFS) final rule, which will provide physicians with a 20-30% increase in remuneration (RVUs and/or fees) for the additional work associated with performing coronary IVL
"We had a strong quarter with solid performance from our businesses and significant progress operationally across the globe," said Doug Godshall, President and Chief Executive Officer of Shockwave Medical. "We were excited to share more about some of the exciting happenings at Shockwave during our recent Investor Innovation Day, and we look forward to bringing a continuous pipeline of novel products to our customers to improve outcomes for patients suffering from cardiovascular disease."
Third Quarter 2023 Financial Results
Revenue for the third quarter ended September 30, 2023, was $186.0 million, a 42% increase from $131.3 million in the same period of 2022. The growth was primarily driven by an increase in the purchase volume of our products in both the United States and internationally.
Gross profit for the third quarter of 2023 was $161.5 million compared to $113.5 million for the third quarter of 2022. Gross margin percentage was 87% for the three months ended September 30, 2023, compared to 86% for the three months ended September 30, 2022.
Total operating expenses for the third quarter of 2023 were $117.9 million, a 54% increase from $76.7 million in the third quarter of 2022. The increase was primarily driven by sales force expansion and higher headcount to support the growth of the business.
Net income for the third quarter of 2023 was $35.0 million, which was consistent with net income in the same period of 2022. Basic and diluted net income per share for the third quarter of 2023 was $0.95 and $0.92 respectively.
Adjusted EBITDA improved by approximately 31% to $65.0 million, in the third quarter of 2023, compared to adjusted EBITDA of $49.8 million in the third quarter of 2022. Adjusted EBITDA is a non-GAAP measure.
Cash, cash equivalents and short-term investments totaled $917.3 million as of September 30, 2023, which is inclusive of net proceeds of $634.4 million from our convertible debt offering in August of 2023.
2023 Financial Guidance
Shockwave Medical projects revenue for the full year 2023 to range from $725 million to $730 million, which represents 48% to 49% growth over the Company's prior year revenue.
Conference Call
Shockwave Medical will host a conference call at 1:30 p.m. Pacific Time / 4:30 p.m. Eastern Time on Monday, November 6, 2023, to discuss its third quarter 2023 financial results. The call may be accessed by dialing 877-704-4453 for domestic callers or 201-389-0920 for international callers, using conference ID: 13737257. A live and archived webcast of the event will be available at https://ir.shockwavemedical.com/.
About Shockwave Medical, Inc.
Shockwave Medical is a leader in the development and commercialization of innovative products that are transforming the treatment of cardiovascular disease. Its first-of-its-kind Intravascular Lithotripsy (IVL) technology has transformed the treatment of atherosclerotic cardiovascular disease by safely using sonic pressure waves to disrupt challenging calcified plaque, resulting in significantly improved patient outcomes. Shockwave Medical has also recently acquired the Neovasc Reducer, which is under clinical investigation in the United States and is CE Marked in the European Union and the United Kingdom. By redistributing blood flow within the heart, the Reducer is designed to provide relief to the millions of patients worldwide suffering from refractory angina. Learn more at www.shockwavemedical.com and www.neovasc.com.
Forward-Looking Statements
This press release contains statements relating to our expectations, projections, beliefs, and prospects, which are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, you can identify these statements by forward-looking words such as "may," "might," "will," "should," "expects," "plans," "anticipates," "believes," "estimates," "predicts," "potential" or "continue," and similar expressions, and the negative of these terms. Forward-looking statements in this press release include, but are not limited to, statements regarding our anticipated future operating results and financial position, including for the full year ending December 31, 2023, our business strategy and plans, our objectives for future operations and financial performance and other matters. You are cautioned not to place undue reliance on these forward-looking statements. Forward-looking statements are only predictions based on our current expectations, estimates, and assumptions, valid only as of the date they are made, and subject to risks and uncertainties, some of which we are not currently aware.
Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others: the impact of global business, political, and macroeconomic conditions, including inflation, rising interest rates, uncertainty with respect to the federal budget, instability in the global banking system, volatile market conditions, supply chain disruptions, cybersecurity events and global events, including regional conflicts around the world, on our operations, financial results, liquidity, capital resources, expenses, supply chain, manufacturing, research and development activities, clinical trials, and employees; our ability to successfully execute our business and growth strategies; our ability to develop, manufacture, obtain and maintain regulatory approvals for, and market and sell, our products; our expected future growth, including the size and growth potential of the markets for our products; our ability to obtain coverage and reimbursement for procedures performed using our products; our ability to scale our organizational culture; the impact of the development, regulatory approval, efficacy and commercialization of competing products; the loss of key scientific or management personnel; our ability to develop and maintain our corporate infrastructure, including our internal controls; our financial performance and capital requirements; the success of any acquisitions that we make; and our ability to obtain and maintain intellectual property protection for our products, as well as our ability to operate our business without infringing the intellectual property rights of others. These factors, as well as others, are discussed in our filings with the Securities and Exchange Commission (SEC), including in the sections titled "Risk Factors" in our most recent Annual Report on Form 10-K and subsequently filed Quarterly Reports on Form 10-Q, and in our other reports filed with the SEC. Except to the extent required by law, we do not undertake to update any of these forward-looking statements after the date hereof to conform these statements to actual results or revised expectations.
Use of Non-GAAP Financial Measures
This press release contains supplemental financial information determined by methods other than in accordance with accounting principles generally accepted in the United States (GAAP), including references to adjusted EBITDA, a non-GAAP financial measure that excludes from net income the effects of income tax provision, other income (expense), interest expense, (loss) income from equity method investment, depreciation and amortization, and stock-based compensation. We believe the presentation of adjusted EBITDA is useful as it provides visibility to our underlying continuing operating performance by excluding the impact of certain items that are non-cash in nature or not related to our core business operations.
Our definition of adjusted EBITDA may differ from similarly titled measures used by others. Adjusted EBITDA should be considered supplemental to, and not a substitute for, financial information prepared in accordance with GAAP. Because adjusted EBITDA excludes the effect of items that increase or decrease our reported results of operations, management strongly encourages investors to review, when they become available, our consolidated financial statements and publicly filed reports in their entirety. A reconciliation of adjusted EBITDA to net income has been provided in the financial statement tables included in this press release, and investors are encouraged to review the reconciliation.
Media Contact:
Scott Shadiow
+1.317.432.9210
[email protected]
Investor Contact:
Debbie Kaster
[email protected]
| SHOCKWAVE MEDICAL, INC. | |||||||||||
| Balance Sheet Data | |||||||||||
| (in thousands) | |||||||||||
| September 30, 2023 | December 31, 2022 | ||||||||||
| (Unaudited) | |||||||||||
| ASSETS | |||||||||||
| CURRENT ASSETS: | |||||||||||
| Cash and cash equivalents | $ | 498,108 | $ | 156,586 | |||||||
| Short-term investments | 419,225 | 147,907 | |||||||||
| Accounts receivable, net | 98,819 | 71,366 | |||||||||
| Inventory | 97,180 | 75,112 | |||||||||
| Prepaid expenses and other current assets | 15,210 | 8,292 | |||||||||
| Total current assets | 1,128,542 | 459,263 | |||||||||
| Operating lease right-of-use assets | 30,360 | 32,365 | |||||||||
| Property and equipment, net | 62,017 | 48,152 | |||||||||
| Equity method investment | 1,810 | 3,512 | |||||||||
| Intangible assets, net | 93,775 | — | |||||||||
| Goodwill | 39,789 | — | |||||||||
| Deferred tax assets | 109,432 | 97,568 | |||||||||
| Other assets | 8,234 | 5,229 | |||||||||
| TOTAL ASSETS | $ | 1,473,959 | $ | 646,089 | |||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||
| CURRENT LIABILITIES: | |||||||||||
| Accounts payable | $ | 6,870 | $ | 6,721 | |||||||
| Accrued liabilities | 69,764 | 55,375 | |||||||||
| Lease liability, current portion | 1,569 | 1,278 | |||||||||
| Total current liabilities | 78,203 | 63,374 | |||||||||
| Lease liability, noncurrent portion | 32,358 | 34,928 | |||||||||
| Convertible debt, noncurrent portion | 730,926 | — | |||||||||
| Debt, noncurrent portion | — | 24,198 | |||||||||
| Related party contract liability, noncurrent portion | 12,273 | 12,273 | |||||||||
| Deferred tax liabilities | 9,647 | — | |||||||||
| Other liabilities | 9,307 | — | |||||||||
| TOTAL LIABILITIES | 872,714 | 134,773 | |||||||||
| STOCKHOLDERS' EQUITY: | |||||||||||
| Preferred stock | — | — | |||||||||
| Common stock | 37 | 36 | |||||||||
| Additional paid-in capital | 535,197 | 548,960 | |||||||||
| Accumulated other comprehensive loss | (149 | ) | (867 | ) | |||||||
| Retained earnings (accumulated deficit) | 66,160 | (36,813 | ) | ||||||||
| TOTAL STOCKHOLDERS' EQUITY | 601,245 | 511,316 | |||||||||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 1,473,959 | $ | 646,089 | |||||||
| SHOCKWAVE MEDICAL, INC. | ||||||||||||||||
| Statement of Operations Data | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
| (in thousands, except share and per share data) | ||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||||||
| Revenue: | ||||||||||||||||
| Product revenue | $ | 186,020 | $ | 131,330 | $ | 527,251 | $ | 345,707 | ||||||||
| Cost of revenue: | ||||||||||||||||
| Cost of product revenue | 24,513 | 17,874 | 70,072 | 47,494 | ||||||||||||
| Gross profit | 161,507 | 113,456 | 457,179 | 298,213 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Research and development | 39,526 | 20,177 | 103,326 | 57,956 | ||||||||||||
| Sales and marketing | 56,907 | 42,082 | 167,656 | 118,558 | ||||||||||||
| General and administrative | 21,451 | 14,434 | 70,386 | 39,988 | ||||||||||||
| Total operating expenses | 117,884 | 76,693 | 341,368 | 216,502 | ||||||||||||
| Income from operations | 43,623 | 36,763 | 115,811 | 81,711 | ||||||||||||
| (Loss) income from equity method investment | (733 | ) | 97 | (1,702 | ) | (1,414 | ) | |||||||||
| Interest expense | (2,509 | ) | (316 | ) | (3,955 | ) | (917 | ) | ||||||||
| Other income (expense), net | 4,699 | (1,423 | ) | 8,667 | (3,206 | ) | ||||||||||
| Net income before taxes | 45,080 | 35,121 | 118,821 | 76,174 | ||||||||||||
| Income tax provision | 10,094 | 118 | 15,848 | 1,089 | ||||||||||||
| Net income | $ | 34,986 | $ | 35,003 | $ | 102,973 | $ | 75,085 | ||||||||
| Net income per share, basic | $ | 0.95 | $ | 0.97 | $ | 2.81 | $ | 2.10 | ||||||||
| Net income per share, diluted | $ | 0.92 | $ | 0.92 | $ | 2.70 | $ | 1.99 | ||||||||
| Shares used in computing net income per share, basic | 36,797,072 | 36,003,931 | 36,630,575 | 35,807,264 | ||||||||||||
| Shares used in computing net income per share, diluted | 38,196,780 | 37,948,049 | 38,184,299 | 37,813,107 | ||||||||||||
| SHOCKWAVE MEDICAL, INC. | |||||||||||||||
| Reconciliation of GAAP Net Income to Adjusted EBITDA | |||||||||||||||
| (Unaudited) | |||||||||||||||
| (in thousands) | |||||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||
| September 30, | September 30, | ||||||||||||||
| 2023 | 2022 | 2023 | 2022 | ||||||||||||
| GAAP Net Income | $ | 34,986 | $ | 35,003 | $ | 102,973 | $ | 75,085 | |||||||
| Non-GAAP Adjustments | |||||||||||||||
| Income tax provision | 10,094 | 118 | 15,848 | 1,089 | |||||||||||
| Other (income) expense | (4,699 | ) | 1,423 | (8,667 | ) | 3,206 | |||||||||
| Interest expense | 2,509 | 316 | 3,955 | 917 | |||||||||||
| Loss (income) from equity method investment | 733 | (97 | ) | 1,702 | 1,414 | ||||||||||
| Depreciation and amortization | 3,009 | 1,258 | 7,283 | 3,318 | |||||||||||
| Stock-based compensation expense | 18,410 | 11,732 | 51,423 | 32,247 | |||||||||||
| Adjusted EBITDA | $ | 65,042 | $ | 49,753 | $ | 174,517 | $ | 117,276 | |||||||
