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LENSAR, Inc. (LNSR)·Q4 2024 Earnings Summary

Executive Summary

  • Q4 2024 revenue was $16.7M, up 38% year over year, driven by record 31 ALLY placements and strong procedure volumes; recurring revenue was ~$10.8M in the quarter and exceeded $40M for the full year .
  • Adjusted EBITDA turned positive for the second consecutive quarter at $0.478M; GAAP net loss of $18.7M ($1.61 per share) was primarily due to a $17.6M non‑cash increase in warrant liability tied to a 155% stock price rise in 2024 .
  • Management guided to topline revenue growth above 27% in FY2025, expects Q1 2025 revenue growth to approximate 27% with acceleration thereafter, and targets positive full‑year 2025 adjusted EBITDA; gross margin expected to approximate 50% in 2025, highest in Q1 and lowest in Q4 given seasonality .
  • Strategic catalysts: expanding OUS footprint (EU and Taiwan clearances mid‑2024), 16 system backlog exiting 2024, and increasing mix of new‑to‑LENSAR customers (75% of 2024 U.S. placements) supporting recurring revenue growth trajectory .

What Went Well and What Went Wrong

  • What Went Well

    • Record system placements: 31 ALLY systems in Q4; installed base surpassed 135 ALLY systems and ~385 total systems by year end, recurring revenue base now >$40M .
    • Market share gains: U.S. procedure market share reached ~21% according to Market Scope; ~75% of U.S. 2024 placements were new‑to‑LENSAR surgeons—a key driver of future recurring revenue .
    • Profitability progress: second consecutive quarter of positive adjusted EBITDA and cash/investments increased $3.9M in Q4; management expects full‑year 2025 positive adjusted EBITDA .
    • Quote: “We achieved our second consecutive quarter of both positive Adjusted EBITDA results and an increased total cash and investments balance even though we reported a GAAP net loss.” — Nick Curtis, CEO .

  • What Went Wrong

    • GAAP net loss widened to $18.7M due to non‑cash warrant liability increase ($17.6M in Q4) as the stock appreciated ~155% in 2024; diluted loss/share was ($1.61) vs ($0.35) YoY .
    • Recurring revenue mix fell to 64% in Q4 from 73% YoY, reflecting higher system sales contribution; gross margin was 42% vs 43% YoY on mix shift .
    • SG&A rose to $6.8M (+7% YoY) with 16% increase in cash selling & marketing to support growth; management signaled SG&A will tick up in 2025 as admin offsets fade .

Financial Results

MetricQ4 2023Q3 2024Q4 2024
Revenue ($USD Millions)$12.105 $13.539 $16.731
Basic & Diluted EPS ($USD)($0.35) ($0.13) ($1.61)
Gross Margin %43% N/A42%
Recurring Revenue % of Total73% 73% 64%

Segment revenue breakdown

Segment ($USD Millions)Q4 2023Q3 2024Q4 2024
Product/System$9.452 $10.578 $13.520
Lease$1.604 $1.724 $1.909
Service$1.049 $1.237 $1.302
Total Revenue$12.105 $13.539 $16.731

KPIs and operating metrics

KPIQ4 2023Q3 2024Q4 2024
Procedure Volumes (units)37,414 42,231 45,586
ALLY Placements (units)N/A24 31
ALLY Installed Base (units)N/A>100 >135
Total Installed Base (LLS + ALLY) (units)~305 (Dec’23 baseline) ~355 ~385
Backlog (ALLY systems)N/A24 16
Adjusted EBITDA ($USD Millions)($1.221) $0.429 $0.478
Cash, Cash Equivalents & Investments ($USD Millions)$24.6 (Dec’23) $18.6 (Sep’24) $22.5 (Dec’24)

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Revenue GrowthFY2025N/AAbove 27% YoY growth New
Revenue SeasonalityFY2025N/AQ1 lowest, Q4 highest New
Q1 Revenue GrowthQ1 2025N/A~27% YoY, then acceleration New
Adjusted EBITDAFY2025N/APositive adjusted EBITDA full year New
Adjusted EBITDAQ4 2024Operating breakeven with some consistency starting as soon as Q4 2024 Positive adjusted EBITDA ($0.478M) delivered Achieved
Gross Margin %FY2025Approx. 50% for 2024 (context) ~50% in 2025; highest in Q1, lowest in Q4 Maintained directional; added seasonal detail
SG&AFY2025N/AContinued investment; SG&A to tick up as admin offsets fade New

Earnings Call Themes & Trends

TopicPrevious Mentions (Q2 & Q3 2024)Current Period (Q4 2024)Trend
OUS expansion & regulatoryCE Mark & Taiwan/HK approvals; first shipments, distributor model; faster OUS revenue recognition than U.S. Continued placements; 24 systems OUS since mid‑Aug 2024; steady growth expected in 2025; larger in 2026 Building steadily
Product adoption & market shareStrong placements; backlog building; private equity channels; U.S. share gains since ALLY launch Record 31 placements; ~21% U.S. procedure share; 75% new‑to‑LENSAR customers Positive momentum
Mix: sales vs placements~60% sold of Q2 placements Aggregate mix ~60% sales; U.S. to be more aggressive on placements; clarified earlier comment Stable mix; more U.S. placements
Gross margin outlook~50% FY2024 expected; 53–55% longer‑term possible with recurring revenue mix ~50% in FY2025, seasonal peak Q1, trough Q4 Maintained with added seasonality
SG&A and commercializationIncreased selling & marketing; admin savings; ERC benefited prior periods SG&A up 7% YoY in Q4; plan to continue investing; SG&A baseline to rise Investment continues
R&D execution & strategy$3.7M intangible impairment; termination of Oertli collaboration; preserve flexibility Lower R&D YoY; ongoing focus on commercial scaling Refocus on commercial priorities
Supply chain & manufacturingBuilding inventory ahead of approvals; lead times managed No major issues flagged; capacity aligned with backlog Stable operations
Competitive landscapeDisplacing older competitive systems; pent‑up replacement cycle Competitive bundling vs productivity; tech threat minimal near term Favorable positioning

Management Commentary

  • “Worldwide procedure volumes grew 24% in 2024 to nearly 170,000… increased our share of the U.S. procedure market to over 20%… for the first time in the Company’s history.” — Nick Curtis, CEO .
  • “Gross margin for the quarter was $7.1 million and represented a gross margin of 42%… We generally expect our gross margin to approximate 50% in 2025 with the gross margin percentage highest in the first quarter and lowest in the fourth quarter.” — Thomas Staab, CFO .
  • “We anticipate top line 2025 revenue growth to be above the 27% growth achieved in 2024… we expect our first quarter 2025 revenue growth to align with our full year 2024 growth rate of 27%, with additional growth anticipated in the subsequent 3 quarters.” — Thomas Staab, CFO .
  • “We placed 31 ALLY systems in Q4… have 16 additional ALLY systems in backlog at the end of the year… achieved our second consecutive quarter of positive Adjusted EBITDA.” — Nick Curtis, CEO .

Q&A Highlights

  • Placement mix and customer acquisition: ~30% competitive replacements; ~22% femto‑naive sites in 2024; continued targeting of 70–85% new customers to maximize recurring revenue .
  • Sales vs placements clarification: Aggregate annual mix around 60% sales; U.S. expected to prioritize placements; CFO corrected prior misstatement to clarify “60% sales” .
  • OUS trajectory: Steady growth expected through 2025 with larger step‑up in 2026; comfort with distributor model in EU/Asia; potential direct presence evaluated for select markets .
  • SG&A baseline: Commercial investment to continue; SG&A to tick up as administrative offsets diminish .
  • Competitive dynamics: Larger players bundle on price; ALLY positioned on productivity and outcomes; no near‑term tech threats perceived .

Estimates Context

  • Wall Street consensus (S&P Global) for Q4 2024 EPS and revenue was attempted but unavailable due to access limits. As a result, estimate comparisons could not be included. S&P Global consensus data was attempted but not retrievable at this time.
MetricQ4 2024 ConsensusActual
Revenue ($USD Millions)Unavailable (S&P Global)$16.731
EPS ($USD)Unavailable (S&P Global)($1.61)

Key Takeaways for Investors

  • Recurring revenue flywheel strengthening: Record placements and 75% new‑to‑LENSAR U.S. customers underpin procedure growth and recurring revenue scale in 2025–2026 .
  • Profitability path intact: Two straight quarters of positive adjusted EBITDA; management guiding to full‑year 2025 positive adjusted EBITDA; watch mix and seasonality in GM% .
  • Mix shift considerations: Q4 recurring mix dipped on strong system sales; margin will hinge on the balance between system placements/sales and high‑margin procedures, especially with OUS expansion .
  • Non‑GAAP vs GAAP optics: GAAP net loss volatility tied to warrant liability revaluation; focus on adjusted EBITDA and cash trajectory for operational progress .
  • OUS expansion cadence: EU/Taiwan clearances opened new channels; expect steady OUS build in 2025 and more pronounced in 2026; distributor model currently preferred .
  • Operating investment: SG&A will rise with commercial buildout; monitor sales productivity and procedure ramp to ensure opex leverage .
  • Near‑term trading implications: Seasonal strength tends to favor Q4; management expects Q1 2025 to be lowest revenue quarter; gross margin highest in Q1, lowest in Q4—trade around mix/seasonality and placement newsflow .