Nevro Reports Second Quarter 2018 Financial Results

Published: Aug 02, 2018

 

REDWOOD CITY, Calif., Aug. 2, 2018 /PRNewswire/ -- Nevro Corp (NYSE: NVRO), a global medical device company that is providing innovative evidence-based solutions for the treatment of chronic pain, today reported financial results for the three and six months ended June 30, 2018.

Second Quarter Financial Results

Revenue for the three months ended June 30, 2018 was $96.1 million versus $78.0 million during the same period of the prior year, representing 23% growth as reported. U.S. revenue for the three months ended June 30, 2018 was $79.9 million, representing 27% growth as reported. International revenue was $16.2 million, representing growth of 4% in constant currency and 8% on an as-reported basis. The increase in revenue was primarily attributable to the continued adoption of the Senza system.

Gross profit for the three months ended June 30, 2018 was $67.9 million, representing a 71% gross margin, up from $53.9 million, representing a 69% gross margin, in the same period of the prior year.

Operating expenses for the three months ended June 30, 2018 were $76.1 million compared to $63.8 million in the same period of the prior year, representing an increase of 19%. The increase in operating expenses was driven primarily by increased headcount and related personnel costs, as well as legal expenses associated with intellectual property litigations.

Loss from operations for the second quarter of 2018 was $8.2 million compared to $9.9 million for the same period of the prior year.

Revenue Guidance for Full Year 2018

Nevro expects worldwide revenue for 2018 to be in the range of $385 to $390 million.

Webcast and Conference Call Information

Management will host a conference call today beginning at 1:30 p.m. PT / 4:30 p.m. ET. Investors interested in listening to the conference call may do so by dialing (866) 393-4306 for U.S. callers, or (734) 385-2616 for international callers (Conference ID: 9865398), or from the webcast on the "Investors" section of the Company's website at www.nevro.com/investors. Following the call, a replay will be available on the Investor Events and Presentations webpage of the Company's website.

About Nevro

Headquartered in Redwood City, California, Nevro is a global medical device company focused on providing innovative products that improve the quality of life of patients suffering from debilitating chronic pain. Nevro has developed and commercialized the Senza spinal cord stimulation (SCS) system, an evidence-based, non-pharmacologic neuromodulation platform for the treatment of chronic pain. The Senza® System and Senza II™ System are the only SCS systems that deliver Nevro's proprietary HF10® therapy. Senza, Senza II, HF10, Nevro and the Nevro logo are trademarks of Nevro Corp.

Forward-Looking Statements

In addition to historical information, this press release contains forward-looking statements with respect to our business, capital resources, revenue projections, strategic initiatives and growth, reflecting the current beliefs and expectations of management made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including continuing adoption of, and interest in, Senza in the U.S. and international markets and our expectations for worldwide revenue for the full year 2018. These forward-looking statements are based upon information that is currently available to us or our current expectations, speak only as of the date hereof, and are subject to numerous risks and uncertainties, including our ability to successfully commercialize our products; our ability to manufacture our products to meet demand; the level and availability of third-party payor reimbursement for our products; our ability to effectively manage our anticipated growth; our ability to protect our intellectual property rights and proprietary technologies; our ability to operate our business without infringing the intellectual property rights and proprietary technology of third parties; competition in our industry; additional capital and credit availability; our ability to attract and retain qualified personnel; and product liability claims. These factors, together with those that are described in greater detail in our Annual Report on Form 10-K filed on February 22, 2018 and our Quarterly Report on Form 10-Q that we expect to file on August 2, 2018, as well as any reports that we may file with the SEC in the future, may cause our actual results, performance or achievements to differ materially and adversely from those anticipated or implied by our forward-looking statements. We expressly disclaim any obligation, except as required by law, or undertaking to update or revise any such forward-looking statements. Our results for the quarter ended June 30, 2018 are not necessarily indicative of our operating results for any future periods.

Investor Relations Contact:
Nevro Investor Relations
(415) 937-5402
ir@nevro.com

                                                                              Nevro Corp.

                                                     Consolidated Statements of Operations and Comprehensive Loss

                                                            (in thousands, except share and per share data)


                                                               Three Months Ended                                  Six Months Ended

                                                                    June 30,                                           June 30,
                                                                  --------                                       --------

                                                            2018                      2017                         2018             2017
                                                            ----                      ----                         ----             ----

                                                                (unaudited)                                    (unaudited)

    Revenue                                                             $96,080                                $78,016                       $183,715      $146,455

    Cost of revenue                                                    28,159                                 24,143                         53,793        46,214
                                                                       ------                                 ------                         ------        ------

    Gross profit                                                       67,921                                 53,873                        129,922       100,241

    Operating expenses:

    Research and development                                           11,416                                  9,537                         22,501        18,236

    Sales, general and administrative                                  64,706                                 54,274                        131,324       104,994
                                                                       ------                                 ------                        -------       -------

    Total operating expenses                                           76,122                                 63,811                        153,825       123,230
                                                                       ------                                 ------                        -------       -------

    Loss from operations                                              (8,201)                               (9,938)                      (23,903)     (22,989)

    Other income (expense):

    Interest income (expense), net                                    (1,444)                               (1,707)                       (2,989)      (3,433)

    Other income (expense), net                                         (592)                                   416                          (715)          947
                                                                         ----                                    ---                           ----           ---

    Loss before income taxes                                         (10,237)                              (11,229)                      (27,607)     (25,475)

    Provision for income taxes                                            383                                    381                            726           642
                                                                          ---                                    ---                            ---           ---

    Net loss                                                         (10,620)                              (11,610)                      (28,333)     (26,117)

    Changes in foreign currency translation
     adjustment                                                         (318)                                    16                            259         (206)

    Changes in unrealized gains (losses) on short-
     term investments                                                     273                                     50                           (78)           94
                                                                          ---                                    ---                            ---           ---

    Net change in other comprehensive loss                               (45)                                    66                            181         (112)
                                                                          ---                                    ---                            ---          ----

    Comprehensive Loss                                                $(10,665)                             $(11,544)                     $(28,152)    $(26,229)
                                                                       ========                               ========                       ========      ========

    Net loss per share, basic and diluted                               $(0.35)                               $(0.40)                       $(0.95)      $(0.89)
                                                                         ======                                 ======                         ======        ======

    Weighted average shares used to compute net loss
     per share, basic and diluted                                  30,028,985                             29,351,414                     29,933,164    29,255,990
                                                                   ==========                             ==========                     ==========    ==========

 

                                              Nevro Corp.

                                      Consolidated Balance Sheets

                            (in thousands, except share and per share data)


                                                         June 30,                December 31,

                                                               2018                       2017
                                                               ----                       ----

                                                        (unaudited)

    Assets

    Current assets

    Cash and cash
     equivalents                                                         $40,838                    $42,845

    Short-term investments                                             223,018                    226,467

    Accounts receivable, net                                            66,042                     67,287

    Inventories, net                                                    94,994                     98,119

    Prepaid expenses and
     other current assets                                                6,752                      6,463
                                                                         -----                      -----

    Total current assets                                               431,644                    441,181

    Property and equipment,
     net                                                                13,610                      8,819

    Other assets                                                         3,829                      3,250

    Restricted cash                                                        806                        806
                                                                           ---                        ---

    Total assets                                                        $449,889                   $454,056
                                                                        ========                   ========

    Liabilities and
     stockholders' equity

    Current liabilities

    Accounts
     payable                                                             $23,543                    $18,492

    Accrued liabilities and
     other                                                              29,992                     39,512
                                                                        ------                     ------

    Total current
     liabilities                                                        53,535                     58,004

    Long-term debt                                                     148,643                    145,019

    Other long-term
     liabilities                                                         2,122                      1,861
                                                                         -----                      -----

    Total liabilities                                                  204,300                    204,884

    Stockholders' equity

    Common stock, $0.001 par
     value, 290,000,000
     shares authorized,
     30,094,631 and
     29,737,561 shares
     issued and outstanding
     at June 30, 2018 and
     December 31, 2017,
     respectively                                                           30                         30

    Additional paid-in
     capital                                                           531,830                    508,228

    Accumulated other
     comprehensive loss                                                (1,061)                   (1,242)

    Accumulated deficit                                              (285,210)                 (257,844)
                                                                      --------                   --------

    Total stockholders'
     equity                                                            245,589                    249,172
                                                                       -------                    -------

    Total
     liabilities
     and
     stockholders'
     equity                                                             $449,889                   $454,056
                                                                        ========                   ========

 

 

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SOURCE Nevro Corp.

Company Codes: NYSE:NVRO

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