Executive Summary

Q4 revenue was $132.1M (+22.6% YoY), with GAAP operating loss of $9.3M and non-GAAP operating loss of $0.3M as acquisition-related costs and amortization were excluded; gross margin dipped to 87.1% from 87.8% YoY, largely due to LimFlow mix, international growth, and emerging therapies mix .
2024 revenue guidance was set/maintained at $580–$595M (+17.5% to +20.5% YoY), and management reiterated the target to reach sustained operating profitability in 1H25 (pulled forward from prior 2H25 on Jan 9) .
Strategic milestones: closed LimFlow (11/15/23), completed enrollment in PEERLESS RCT (with data targeted in 2H24), and began reporting revenue by growth pillars (VTE vs. Emerging Therapies) .
Risk watch: DOJ Civil Investigative Demand received in Dec 2023 re meals and consulting payments to HCPs; company is cooperating and expects no impact to commercial execution; legal expenses to flow through SG&A .
Street estimates: S&P Global consensus could not be retrieved via tool for NARI this quarter; we cannot benchmark the results to consensus in this report. Values retrieved from S&P Global were unavailable via our tool.

What Went Well and What Went Wrong

What Went Well

“We are thrilled with our Q4 and full year 2023 performance. In the fourth quarter, we achieved record revenue of more than $132 million, driven by strength in our core VTE business, strong growth from our Emerging Therapies portfolio and continued traction from International expansion.” — CEO Drew Hykes .
Enrollment completed in PEERLESS (FlowTriever vs. CDT), with data aimed for 2H24; execution across three RCTs (PEERLESS, PEERLESS II, DEFIANCE) continues; management expects this evidence to help establish standard of care in VTE .
International momentum: “International revenue was nearly $8 million in Q4, up more than 130% versus the prior year,” with Europe leading and favorable reimbursement in France; first patients in China and Japan expected in 2024 .

What Went Wrong

Gross margin compression: 87.1% in Q4 vs. 87.8% prior-year quarter, pressured by early LimFlow contribution, international mix, and lower GM in emerging therapies; management expects low 87% in near term, with pickup in 2H24; longer term mid-80s% .
GAAP operating loss widened YoY to $9.3M (vs. $5.9M), driven by LimFlow transaction costs, personnel-related expenses, and acquired intangible amortization; non-GAAP operating loss narrowed to $0.3M excluding $7.7M acquisition costs and $1.3M amortization .
DOJ Civil Investigative Demand (Dec 2023) regarding HCP meals and consulting payments; investigation may take “years,” with related legal/expert costs recorded in SG&A .

Financial Results

Headline P&L and Margins (USD Millions, except per-share; quarters shown oldest → newest)

Metric	Q2 2023	Q3 2023	Q4 2023
Revenue	$119.0	$126.4	$132.1
YoY Revenue Growth	28.3%	31.4%	22.6%
Gross Profit	$105.2	$111.9	$115.1
Gross Margin %	88.4%	88.5%	87.1%
GAAP Operating Income (Loss)	$(1.5)	$2.1	$(9.3)
Non-GAAP Operating Income (Loss)	N/A	N/A	$(0.3)
Net Income (Loss)	$2.1	$3.2	$(4.7)
Diluted EPS	$0.04	$0.05	$(0.08)
Operating Expenses	$106.7	$109.8	$124.4

Notes: Q4 non-GAAP excludes $7.7M acquisition-related costs and $1.3M acquired intangible amortization .

Revenue by Growth Pillar (USD Millions, unaudited; company-disclosed split)

Segment	Q2 2023	Q3 2023	Q4 2023
VTE	$114.086	$121.460	$126.671
Emerging Therapies	$4.919	$4.906	$5.423
Total Revenue	$119.005	$126.366	$132.094

Balance Sheet / Cash Flow (selected)

Cash and investments at Q4-end: $116.1M ; Cash and cash equivalents: $38.6M; Short-term investments: $76.9M .
FY23 Operating cash flow: $35.9M (vs. $(14.0)M in 2022) .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue	FY 2024	$580–$595M (initiated Jan 9, 2024)	$580–$595M (Feb 28 reiteration)	Maintained
Sustained Operating Profitability	Company-level	2H 2025 (post-LimFlow, Nov 1, 2023)	1H 2025 (pulled forward Jan 9; maintained Feb 28)	Pulled forward
Sequential Revenue (Q1)	Q1 2024 vs. Q4 2023	N/A	~+4% sequential growth expected	New detail

Management also guided gross margin to remain in low ~87% in near term with improvement in 2H24; LT target mid-80s% .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q2 2023, Q3 2023)	Current Period (Q4 2023)	Trend
Competition/trialing	Trialing persisted; confident in leadership; 31% growth 1H despite trialing	Competitive dynamics incorporated in 2024 outlook; leadership reiterated	Stable/managed
Gross Margin	High-80s% with stable pricing; LT mid-80s view	87.1% with LimFlow/international/emerging mix; near-term low 87%, 2H24 pickup; LT mid-80s	Slight near-term headwind; improving 2H24
Emerging Therapies	RevCore/InThrill launched; early traction	Emerging rose to $5.4M in Q4; growth expected but lumpy (VAC timing, launches)	Building, lumpy
International	Record quarters; runway to 20% over time	“Nearly $8M” Q4; favorable France reimbursement; first patients in China/Japan expected in 2024	Improving
Clinical Evidence	FLAME published; RCTs advancing	PEERLESS enrollment completed; 2H24 data targeted; PEERLESS II and DEFIANCE on track	Strengthening
LimFlow/CLTI	Deal announced (Nov 1) with NTAP/APC paths	Integration underway; foundational 2024 launch; applied for NTAP (Oct effective)	Scaling
DOJ/CID	—	CID received Dec 2023; cooperating; no impact expected; SG&A to include legal/expert costs	New headwind (monitor)

Management Commentary

CEO on Q4/FY: “record revenue of more than $132 million… driven by… core VTE, strong growth from Emerging Therapies… and International expansion,” adding that the company is “positioning Inari for sustained operating profitability in the first half of 2025” .
CEO on clinical: “completion of enrollment in PEERLESS… an important step… We look forward to the data readout in the second half of 2024” .
CFO on gross margin dynamics: “impact from the LimFlow acquisition… internationalization… emerging therapy products have a lower gross margin… likely another quarter… low 87% range, then… pickup in the second half of the year… longer term… mid-80s” .
CFO on 2024 cadence: “sequential revenue growth of approximately 4% for Q1 2024… expect strong revenue growth momentum in the back half of the year” .
CEO on competition: “We exited 2023 as the clear market leader… expect to continue to be the market leader in 2024” .

Q&A Highlights

DOJ CID: Received in Dec 2023; scope relates to HCP relationships; company cooperating; timing likely measured in years; management expects no impact on commercial execution .
2024 Outlook drivers: Guidance philosophy remains conservative; growth expected across all three pillars with VTE majority, modest LimFlow contribution, and international strength .
Gross margin path: Q4 below Street; drivers include LimFlow, international mix, emerging therapies; expect low ~87% near term and improvement 2H24; LT mid-80s% .
LimFlow economics/reimbursement: Inpatient DRG supports positive contribution margin today; NTAP application submitted and expected to add ~$16k per case starting October; non-emergent, concentrated center strategy with dedicated sales force .
Cadence/seasonality: Q1 sequential +~4% vs Q4; expect accelerating growth in 2H24; Q2 seasonality historically soft but uncertain .

Estimates Context

We attempted to retrieve S&P Global (Capital IQ) consensus for revenue and EPS for Q4 2023 and the prior two quarters, but estimates were unavailable via our tool for NARI this quarter. As a result, we cannot provide a vs-consensus beat/miss assessment. Values retrieved from S&P Global were unavailable via our tool.

Key Takeaways for Investors

Core VTE engine remains healthy with record Q4 revenue and continued market development; management reiterates leadership despite competitive trialing .
Mix headwinds (LimFlow, international, emerging therapies) compressed gross margin near term; expect stabilization in low ~87% then improvement in 2H24; longer-term mid-80s% GM remains credible .
2024 revenue guide (+17.5%–20.5%) and Q1 +~4% sequential target suggest steady growth ramp with back-half acceleration; LimFlow contribution remains modest in 2024 as the team focuses on foundational launch .
Clinical catalysts: PEERLESS RCT readout in 2H24 may support share gains vs. lytic therapy in PE; continued progress in PEERLESS II and DEFIANCE supports multi-year evidence-led TAM expansion .
Watch DOJ CID trajectory (multi-year typical timelines) and any incremental legal expense drag in SG&A; management does not expect commercial impact .
International is scaling from a small base (“nearly $8M” in Q4) with favorable reimbursement in France and first cases targeted in China/Japan in 2024—potential multi-year mix and growth driver .
Non-GAAP operating loss was nearly breakeven in Q4, excluding acquisition and amortization costs; sustained operating profitability pulled forward to 1H25 and reiterated .

Inari Medical, Inc. (NARI)·Q4 2023 Earnings Summary