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RxSight, Inc. (RXST)·Q4 2024 Earnings Summary

Executive Summary

  • Q4 2024 revenue was $40.2M, up 41% year over year; gross margin expanded to 71.6%, and adjusted EPS turned positive at $0.03 while GAAP EPS was $(0.15) as OpEx grew to support commercial scale-up .
  • Mix shift toward LAL (71% of revenue) and lower-cost/higher-ASP LDDs drove margin expansion; LAL procedures reached 29,069 and LDD sales were 83, lifting the installed base to 971 (+46% YoY) .
  • FY25 guidance reiterated: revenue $185–$197M, gross margin 71–73%, OpEx $165–$170M with $22–$25M of non‑cash SBC, signaling confidence in durable growth and continued margin progress .
  • Strategic catalysts: FDA post-approval outcomes supporting superior refractive precision, planned LDD functionality to customize lens asphericity in 2H25, and international expansion efforts (Asia/Europe); these reinforce adoption momentum and narrative strength .
  • Street consensus via S&P Global was unavailable at the time of drafting due to request limits; therefore estimate beat/miss comparisons are not provided (attempted via S&P Global and failed).

What Went Well and What Went Wrong

What Went Well

  • Record operational momentum: Q4 revenue $40.2M (+41% YoY), LAL units 29,069 (+61% YoY), LDD units 83; installed base reached 971 (+46% YoY) .
  • Margin expansion and positive adjusted earnings: gross margin 71.6% (vs. 61.8% LY), adjusted net income $1.3M ($0.03/share) on strong LAL mix and cost improvements; “expanded our gross margin to 71.6%...up from 61.8%” .
  • CEO framing of category leadership and growth runway: “adjustability has the potential to transform the premium cataract market…we are still in the early stages” and post-approval data showed >14x odds of low residual sphere/cylinder vs monofocal IOLs .

What Went Wrong

  • GAAP profitability remains a headwind: Q4 GAAP net loss $(5.9)M and $(0.15) per share despite adjusted profitability, reflecting investment in SG&A and R&D to scale .
  • Operating expenses up 31% YoY to $37.4M in Q4; management reiterated ongoing spend to expand commercial footprint and education, pressuring near-term GAAP profit .
  • Seasonality and limited international revenue contribution in 2025: management expects Q1 and Q3 to be weaker and revenue outside North America to remain nominal in 2025 (more meaningful in 2026+), tempering near-term growth cadence .

Financial Results

MetricQ4 2023Q3 2024Q4 2024
Revenue ($USD Millions)$28.6 $35.3 $40.2
Gross Profit ($USD Millions)$17.7 $25.2 $28.8
Gross Margin %61.8% 71.4% 71.6%
Total Operating Expenses ($USD Millions)$28.5 $34.4 $37.4
Net Loss ($USD Millions)$(9.2) $(6.3) $(5.9)
GAAP EPS ($)$(0.26) $(0.16) $(0.15)
Adjusted EPS ($)$(0.13) $0.00 (diluted) $0.03

Segment and mix (Q4 2024):

  • LAL revenue $28.5M (71% of total), +60% YoY; LDD revenue $10.7M, +7% YoY .
  • LAL units 29,069; LDD units 83; LDD installed base 971 (+46% YoY from 666) .

KPIs

KPIQ2 2024Q3 2024Q4 2024
LAL Units (procedures)24,214 24,554 29,069
LDD Units Sold78 78 83
LDD Installed Base (units)810 888 971
LAL Revenue Mix (%)——71%
LAL per LDD (utilization)11.0 (Q2) ~8.7 (Q3) 10.9 (Q4)

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Revenue ($USD Millions)FY 2025$185–$197 $185–$197 Maintained
Gross Margin %FY 202571–73% 71–73% Maintained
Operating Expenses ($USD Millions)FY 2025$165–$170 $165–$170 Maintained
Non‑cash SBC ($USD Millions)FY 2025$22–$25 $22–$25 Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q2/Q3 2024)Current Period (Q4 2024)Trend
Adoption & LAL+ product performanceQ2: Strong LAL growth (+92% YoY), LAL+ reception; Q3: LAL revenue +79% YoY, installed base 888 LAL mix 71%; LAL units 29,069; continued enthusiasm for adjustability Improving
Margin trajectoryQ2 GM 69.5%; FY24 GM guide 68–70%; Q3 GM 71.4%; guide raised to 70–71 GM 71.6%; CFO sees consistent expansion; long-term potential “80%+” GM as mix skews to LAL Improving
Commercial investments & educationQ2/Q3: expanding commercial org; HCP education emphasized Commercial team >200; expanded optometrist education; drive deeper account penetration Ongoing build
International expansionLimited specifics in Q2/Q3 2025 outside NA nominal; more meaningful in 2026+; progress toward Asia/Europe approvals Building for 2026+
Regulatory/clinical dataQ2/Q3: LAL+ launch; margin on new LDD; guidance updates FDA post-approval results (superior refractive precision vs monofocal); extended diopter powers; planned LDD asphericity customization 2H25 Strengthening evidence
Seasonality/cadenceNoted seasonality; Q3/Q4 stronger Reiterated Q1/Q3 weaker; Q2/Q4 stronger Consistent seasonality
Competitive dynamics—Expect some industry impact; less direct to LAL; presbyopia tech competition Manageable

Management Commentary

  • CEO: “Adjustability has the potential to transform the premium cataract market…we are still in the early stages of realizing this vision.”
  • CEO on clinical outcomes: FDA post‑approval study showed >14x odds of achieving very low residual sphere and cylinder versus monofocal IOLs; >4x odds of UDVA 20/20 or better in LAL eyes .
  • CFO on margins: “You should see a consistent cadence in margin improvements…at real maturity, I could see at 80% plus.” .
  • Product roadmap: FDA‑approved extension of LAL+ diopter powers and upcoming LDD functionality to customize asphericity, opening the door to higher customization akin to refractive surgery advances .
  • Commercial expansion: Organization grew from ~10 to >200 since IPO; focus on sales, education, installation, training, and clinical support .

Q&A Highlights

  • Utilization per LDD: Cohorts converge to similar LALs/LDD over ~1 year; Q4 metric was 10.9, with variability from seasonality and new installs; focus remains absolute LAL volume growth .
  • Aspheric customization: LAL/LAL+ are already aspheric; new LDD functionality will allow doctors to modify asphericity based on clinical need, with broader customization potential over time .
  • Guidance cadence: Expect typical seasonality (Q1/Q3 weaker; Q2/Q4 stronger); international revenue minimal in 2025; mix shift to higher‑margin LAL drives GM within 71–73% .
  • OpEx priorities: Continued investment in commercial team and optometrist education to deepen adoption; field upgrades and training as value‑adds to expand account penetration .
  • Competitive landscape: Some industry impact likely as RXST approaches ~10% of premium IOL procedures, but competition expected to be more focused on other presbyopia‑correcting technologies .

Estimates Context

  • S&P Global consensus data for EPS/revenue and target price was attempted but unavailable due to request limits at time of drafting; therefore, estimate comparisons (beat/miss) are not provided. Management reiterated FY25 guidance, which can serve as an anchor for expectations .
  • Investors should monitor near-term Street revisions for mix-driven margin expansion and adjusted profitability inflection, particularly given LAL mix and utilization trends .

Key Takeaways for Investors

  • Mix‑led margin expansion continues; LAL at 71% of revenue and cost/ASP improvements on LDDs support gross margin in low‑70s with runway toward higher long‑term levels .
  • Adjusted profitability inflected in Q4; GAAP losses persist due to scale investments, but operating leverage is improving with revenue growth and mix .
  • Durable growth thesis: FY25 revenue $185–$197M (+32–41% YoY) maintained; narrative strengthened by clinical validation and upcoming customization features (LDD asphericity) .
  • Adoption runway substantial: Installed base 971 (~15% of cataract surgeons trained), with treatment-center models enabling broader access and utilization over time .
  • Near-term cadence: Expect seasonal softness in Q1/Q3 and nominal international contribution in 2025; positioning for more meaningful OUS impact in 2026+ .
  • Monitor competitive updates in presbyopia-correcting IOLs; RXST’s differentiated adjustability and clinical outcomes help defend share and drive category growth .
  • Tactical: With estimates unavailable, trade on company guidance, margin trajectory, utilization metrics (LAL per LDD), and product/regulatory milestones (aspheric functionality release timing) .