Yahoo Finance Hyperfine Inc (HYPR) Q1 2024 Earnings Call Transcript Highlights: Navigating Growth and Challenges
Revenue: $3.3 million for Q1 2024, up 25% year-over-year.
Gross Profit: $1.4 million for Q1 2024, compared to $1.2 million in Q1 2023.
Gross Margin: 41.1% for Q1 2024.
Net Loss: $9.8 million for Q1 2024, improvement from $12.2 million year-over-year.
Earnings Per Share (EPS): Net loss of $0.14 per share for Q1 2024, improved from a net loss of $0.17 per share in Q1 2023.
Cash and Cash Equivalents: $63.2 million as of March 31, 2024.
Cash Burn: $12.0 million for Q1 2024.
2024 Revenue Guidance: Expected to be between $12 million to $15 million.
2024 Gross Margin Guidance: Anticipated to be between 45% to 50%.
2024 Total Cash Burn: Approximately $40 million.
Release Date: May 13, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
Hyperfine Inc reported a revenue of $3.3 million for Q1 2024, marking a 25% increase compared to Q1 2023.
The company successfully launched its latest AI-powered software in January, receiving positive feedback for its image quality improvements, particularly in stroke detection.
Hyperfine Inc has expanded its international presence, establishing distribution infrastructure in key European markets and appointing experienced market development resources.
The company has maintained strong spending discipline while continuing to invest in innovation, clinical evidence, and commercialization to drive future growth.
Hyperfine Inc's Swoop system scans are covered by the same reimbursement codes used for conventional MRI, supporting broader adoption and integration into clinical settings.
Negative Points
Despite revenue growth, Hyperfine Inc reported a net loss of $9.8 million for Q1 2024, although this was an improvement from the previous year's net loss of $12.2 million.
The global average selling price (ASP) for the Swoop systems was lower this quarter, primarily due to a heavier international mix, impacting overall profit margins.
The company's gross margin for Q1 2024 was 41.1%, which is below the full-year target range of 45% to 50%.
Hyperfine Inc's cash burn for Q1 2024 was $12.0 million, with a seasonal expectation that this rate is higher than other quarters.
There is ongoing variability in deal closures and ASP due to the complex hospital buying processes and the new mix of sales channels, which could affect financial stability and forecasting accuracy.
Q & A Highlights
Q: Why not raise the low end of the guidance range given the Q1 performance? A: Maria Sainz, President and CEO of Hyperfine, explained that while Q1 showed a strong start, the company prefers to maintain the current guidance to avoid getting ahead of themselves, especially with new international partnerships just beginning to activate.
Q: What gives you confidence to reaffirm the full year gross margin guide of 45% to 50% despite a softer Q1 margin? A: Brett Hale, CFO, noted that the lower ASP in Q1 was due to a heavier international mix, which impacted margins. However, they expect margins to improve and align with the full-year guidance as the year progresses.
Q: Can you discuss the market opportunity and level of demand for Swoop in the new European markets? A: Maria Sainz highlighted that the European markets, like the US, have a strong demand for MRI technology, particularly as Alzheimer's drugs become available. The company has set up infrastructure and distributor partnerships in key markets like France, the UK, and Italy to capitalize on these opportunities.
Q: Could you provide an update on the enrollment and expected data updates from the Alzheimer's study? A: Maria Sainz mentioned that the enrollment is progressing well, particularly at Washington University, a key site in the study. Data updates are expected possibly by the Alzheimer's Association International Conference in July or the clinical trials meeting in Madrid by October.
Q: How does the introduction of new AI laws in states like Connecticut and Utah impact the adoption of Swoop's AI-powered imaging? A: Maria Sainz responded that the company's technical team has not raised concerns about these laws affecting Swoop's operations, as their AI algorithms are proprietary and used internally for image enhancement, not patient interaction.
Q: What is the visibility for orders and system sales for the rest of the year, especially with the new international distributors? A: Maria Sainz expressed confidence in the growing pipeline and the experience of their US team. She noted that while there is variability in when deals close, the pipeline is expanding, and the company is establishing more flagship institutions both in the US and internationally.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
