Executive Summary

Q2 revenue declined 19% year over year to $11.6M, but gross margin expanded to 40% (from 33% in Q1) on cost reductions; consumables remained a bright spot with the second-highest quarter and >600 recurring subscriptions .
Management cut FY2024 guidance from +6–8% growth with positive adjusted EBITDA to revenue roughly flat with 2023 (~$49.2M) and adjusted EBITDA loss of $6–8M, citing capital equipment softness amid higher interest rates; this is a material guidance reset .
Operating loss improved to $(3.2)M from $(3.9)M a year ago; net loss per share narrowed to $(0.08) from $(26.14) in Q2 2023 (share count effects), with cash at $5.3M at quarter-end .
A June 18, 2024 Nasdaq delisting notice adds listing-risk overhang; together with the guidance cut, this is the likely stock narrative catalyst despite gross margin improvement and consumables traction .

What Went Well and What Went Wrong

What Went Well

Gross margin expansion to 40% (up from 33% in Q1) driven by cost reduction actions implemented earlier in the year; operating expenses fell 22% y/y to $7.8M, improving operating loss by 17% y/y .
Consumables strength: second-highest consumable revenue quarter and >600 recurring subscriptions, translating to >$2M in scheduled shipments over the next 12 months .
Product interest: U.S. launch of Waterlase iPlus Premier (in prior quarter) drew a “positive response,” underscoring demand for core platforms (management commentary) .
- “We experienced another strong quarter in consumable revenue, recording our second-highest mark ever and achieving over 600 recurring subscriptions… Our gross margin increased to 40%… due to cost reduction efforts…” – John Beaver, CEO .

What Went Wrong

Top line contraction: net revenue fell to $11.6M from $14.3M y/y; U.S. laser revenue dropped to $3.6M from $6.3M; international consumables declined 12% y/y; international laser was roughly flat .
Guidance reset: FY2024 revenue now expected to be similar to 2023 (vs prior +6–8% growth), and adjusted EBITDA now guided to a $(6)–$(8)M loss (vs prior positive) .
Capital and listing overhang: cash of $5.3M and a June 18 notice of Nasdaq delisting elevate financing/listing risk into 2H24 (and “going concern” risk referenced in forward-looking statements) .

Financial Results

Summary financials (oldest → newest)

Metric	Q2 2023	Q4 2023	Q1 2024	Q2 2024
Revenue ($USD Millions)	$14.286	$13.490	$10.131	$11.555
Gross Profit ($USD Millions)	$6.118	$3.524	$3.336	$4.609
Gross Margin (%)	43%	26.1% (calc. from $3.524/$13.490)	33%	40%
Operating Income (Loss) ($USD Millions)	$(3.872)	$(5.076)	$(4.526)	$(3.220)
Net Loss per Share (Basic & Diluted)	$(26.14)	$(1.76)	$(0.36)	$(0.08)
Cash & Cash Equivalents ($USD Millions)	—	$6.566	$6.393	$5.272

Note: Q4 2023 gross margin percentage is calculated from reported revenue and gross profit. Citations provided for inputs .

Segment/KPI details

KPI / Segment	Q1 2024	Q2 2024
U.S. Laser Revenue ($USD Millions)	$2.7	$3.6
International Laser Revenue ($USD Millions)	$2.5	$2.4
U.S. Consumables & Other (YoY)	+17% YoY	−5% YoY
International Consumables & Other (YoY)	+8% YoY	−12% YoY
Recurring Subscriptions (units)	“over 600” (running)	“over 600” (running)
Scheduled Shipments (next 12 months)	—	>$2M

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Net Revenue	FY 2024	$52–$53M (+6–8% YoY)	“Similar to 2023” (~$49.2M)	Lowered
Adjusted EBITDA	FY 2024	Positive for FY2024	$(6)M to $(8)M loss	Lowered

Earnings Call Themes & Trends

Note: A Q2 2024 earnings call transcript was not available in our databases; themes below reflect prepared remarks/press releases for Q2 and transcripts/press for Q-1 (Q1 2024) and Q-2 (Q4 2023).

Topic	Previous Mentions (Q4 2023 and Q1 2024)	Current Period (Q2 2024)	Trend
Macro/Interest Rates	“Challenging interest rate environment” in 2023; reiterated going into 2024 . Q1 commentary cited “tougher economic climate” .	“Ongoing revenue challenges due to higher interest rates” .	Persistent headwind
Consumables/Subs	Record consumables in 2023; subscriptions introduced . Q1: third-strongest consumables; >600 subscriptions .	Second-highest consumables; >600 subscriptions; >$2M scheduled shipments .	Strengthening/recurring base building
Product Adoption	Increased adoption/Waterlase trial conversion in 2023 . Q1: 67% of U.S. Waterlase sales from new customers; 42% from specialists .	Positive response to U.S. Waterlase iPlus Premier launch .	Positive adoption
Cost Structure/Margins	2023 cost savings; in-house trunk fiber; FY GM 34% .	GM 33%, +700 bps seq vs Q4; opex −9% y/y .	GM 40%, opex −22% y/y .
Liquidity/Listing Risk	Equity raises, sufficient liquidity outlook for near-term 2024 .	“Strengthened the balance sheet” .	Nasdaq delisting notice (June 18); going concern risks referenced .

Management Commentary

“We experienced another strong quarter in consumable revenue, recording our second-highest mark ever and achieving over 600 recurring subscriptions… Our gross margin increased to 40%, up from 33% in the first quarter of 2024, due to cost reduction efforts implemented earlier in the year.” – John Beaver, President & CEO .
“Despite ongoing revenue challenges due to higher interest rates, I believe our performance shows that we are well-positioned for greater gains once our market returns to normal… The positive response to the U.S. launch of our Waterlase iPlus Premier laser system last quarter underscores the strong interest in our industry-leading products.” – John Beaver .

Q&A Highlights

The Q2 2024 earnings call transcript was not available in our sources; therefore, Q&A themes and guidance clarifications for Q2 cannot be provided at this time. We reviewed and synthesized all available Q2 prepared remarks/press releases and the prior two quarters’ primary documents .

Estimates Context

S&P Global (Capital IQ) Wall Street consensus for Q2 2024 was unavailable due to a mapping issue for BIOL; therefore, we cannot provide S&P Global estimate comparisons for revenue and EPS at this time.
For directional context from third-party sources: InvestorPlace/TradeSmith reported Q2 consensus of $13.49M revenue and $(0.07) EPS; actuals were $11.56M and $(0.08), implying misses vs those third-party figures .

Q2 2024: Actual vs Third-Party Consensus (context only)

Metric	Actual	Third-Party Consensus	Delta
Revenue ($USD Millions)	$11.555	$13.490	−$1.935
EPS (Basic & Diluted)	$(0.08)	$(0.07)	$(0.01)

Note: S&P Global consensus was unavailable; third-party figures are provided only for directional context with explicit source citations.

Key Takeaways for Investors

The story is bifurcated: consumables/subscriptions are resilient and expanding, and gross margin improved to 40%, but capital equipment softness tied to high rates forced a material guidance reset for FY2024 .
Expect near-term estimate cuts and narrative pressure given the reset from prior “growth/positive EBITDA” guide to “flat revenue/EBITDA loss” for FY2024; this likely weighs on sentiment until macro or end-market purchasing power improves .
Focus on recurring revenue durability: >600 subscriptions and scheduled shipments >$2M over 12 months offer visibility and cushion while capital spending cycles remain weak .
Margin trajectory is a positive offset: opex discipline and cost reductions are flowing through; if sales stabilize, incremental margins could further expand gross margin and shrink losses .
Liquidity/listing risk warrants monitoring: $5.3M cash at Q2-end and the June Nasdaq delisting notice elevate financing/execution risk into 2H24; watch for additional capital actions and operating cash flow trends .
Product demand indicators remain constructive (Waterlase iPlus Premier response, new-customer mix in Q1), suggesting cyclical more than structural headwinds; a rate-driven rebound could re-accelerate systems .
Trading setup: near-term bias cautious on guidance reset/listing risk; medium-term optionality if capital equipment demand normalizes and margin discipline persists .

Additional Primary Sources Reviewed (Q2-related and prior quarters)

Q2 2024 8-K and press release with full financials/guidance .
Q1 2024 8-K and press release with segment/KPIs and prior guidance .
Q4/FY2023 8-K and press release (for baseline and initial FY2024 guide) .
Nasdaq delisting notice press (June 18, 2024) .

All citations are from SEC-filed 8-Ks/press releases and noted web sources.

BIOLASE, INC (BIOL)·Q2 2024 Earnings Summary