Avinger Inc (AVGR)·Q4 2023 Earnings Summary

Executive Summary

• Q4 revenue grew 5% sequentially to $1.91M but declined ~5% YoY; gross margin compressed to 20% (from 21% in Q3 and 34% YoY) while operating expenses rose with salesforce expansion and transaction costs, driving a wider net loss of $(5.0)M .
• Announced a strategic partnership with Zylox-Tonbridge: $7.5M initial equity funded in March 2024 (priced at $3.66), up to $15M total; CRG exchanged ~$60M liquidation preference preferred into $10M Series A-1 (no liquidation/dividend preference) and extended debt principal to Q1’27 with PIK interest—materially improving the capital structure .
• Commercial momentum: Tigereye ST revenue up >50% QoQ; continued limited launch of Pantheris LV (≈50 cases by 19 physicians), with full commercial launch targeted mid-2024; sales headcount expanded >25% to 26 .
• Coronary CTO program advanced (Phase 2 design selection complete; multiple animal/cadaver studies); IDE submission anticipated in Q3 2024—an important medium-term catalyst .
• S&P Global consensus estimates for Q4 2023 were unavailable, so beat/miss analysis versus Street cannot be provided; we note this explicitly for estimate context.

What Went Well and What Went Wrong

• What Went Well

  • Strategic financing/partnership with Zylox-Tonbridge provides near-term capital and long-term operating leverage (manufacturing, distribution in Greater China) and new U.S./Germany distribution options; $7.5M initial tranche closed in March 2024 .
  • Product traction: “Tigereye ST revenue increasing by more than 50% in the fourth quarter compared to the prior quarter” and 32 physicians at 25 sites using the device since introduction .
  • R&D progress: “completion of Phase 2 design selection and now three animal studies and two cadaver heart studies… IDE application… in the third quarter of 2024” for the coronary CTO-crossing system .

• What Went Wrong

  • Revenue down YoY and margins compressed: Q4 revenue $1.91M vs $2.00M YoY; gross margin 20% (vs 34% YoY) due to lower production activity and higher non-cash stock comp; net loss widened to $(5.0)M .
  • Operating expenses increased to $5.0M (vs $4.4M in Q3) from sales headcount growth, Zylox transaction costs, and stock comp, pressuring operating loss/EBITDA .
  • Pantheris LV full launch timing pushed to mid-2024 (from a Q4 2023 expectation in prior communications), extending the timeline for broader atherectomy contribution .

Financial Results

Quarterly trends

Note: Share counts and EPS reflect reverse stock splits; cross-period EPS comparability is limited .

Year-over-year (Q4)

KPIs and operating metrics

Segment breakdown: Not applicable; Avinger does not report separate operating segments in these materials.

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “We are excited to begin our strategic partnership with Zylox-Tonbridge… [it] provides strategic equity funding to support our growth initiatives… opens a proven commercial channel for Avinger products to enter the… Greater China market… [and] the opportunity… to develop a more cost-efficient manufacturing structure to support… sales and improve gross margin.” — Jeff Soinski, CEO .
• “Tigereye ST… we are encouraged by the progress… Tigereye ST revenue increasing by more than 50% in the fourth quarter compared to the prior quarter.” — Jeff Soinski .
• “We anticipate filing an IDE application with the FDA in the third quarter of 2024 to allow for the initiation of a clinical study following approval” (coronary CTO device) .
• “CRG… exchanged its Series A preferred stock with an aggregate liquidation preference of approximately $60 million for new Series A-1 preferred stock with a value of $10 million… [and] extended principal payments… to the first quarter of 2027.” .

Q&A Highlights

• China approval timeline: Zylox estimates ~9–15 months; target launch in China market in 2025, subject to regulatory factors .
• Capacity to support China while growing U.S.: Current facility and capability (expandable shifts) seen as sufficient; lease extended to bridge Zylox manufacturing ramp .
• Salesforce productivity ramp: Typically ~6 months; expect contribution in 2H’24 as new hires and Pantheris LV full launch support growth .
• Path to $2.5M/quarter run-rate (for the Zylox milestone): Management aims to deliver that growth through 2H’24 into 2025 via sales ramp and portfolio expansion .

Estimates Context

• Attempts to retrieve S&P Global (Capital IQ) consensus for AVGR Q4 2023 failed due to missing CIQ mapping; as a result, Street consensus for revenue and EPS was unavailable in S&P Global and a beat/miss analysis cannot be provided (we default to noting unavailability) [SpgiEstimatesError from tool].

Key Takeaways for Investors

• Balance sheet and capitalization improved: $7.5M equity funded, preferred recapitalized from ~$60M liquidation preference to $10M Series A-1, and debt principal extended to 2027—reducing overhang and extending runway .
• Near-term growth drivers: Tigereye ST momentum (>50% QoQ growth) and broader launch of Pantheris LV mid-2024, supported by >25% salesforce expansion to 26 heads .
• Medium-term catalyst: Coronary CTO IDE submission in Q3’24—entry into a large market with established reimbursement could re-rate the story if clinical execution is strong .
• Operating leverage potential: Zylox manufacturing option (cost-plus) and distribution in Greater China may support gross margin improvement and incremental revenue over time once regulatory and manufacturing milestones are achieved .
• Near-term watch items: Gross margin recovery (production normalization), OpEx discipline as new hires ramp, and cadence to ~$10M revenue over four quarters to unlock the second Zylox tranche .
• No formal financial guidance provided; trajectory depends on salesforce productivity, LV launch timeline, and macro/clinical adoption dynamics .

Citations:

• Q4 2023 8-K and press release:
• Q4 2023 earnings call transcript:
• Q3 2023 8-K and press release:
• Q2 2023 8-K and press release: