AtriCure Reports First Quarter 2023 Financial Results

Worldwide revenue of $93.5 million – an increase of 25.4% year over year

U.S. revenue of $78.2 million – an increase of 25.6% year over year

International revenue of $15.3 million – an increase of 24.4% year over year

Net loss of $6.5 million – an improvement of $8.7 million year over year

Positive adjusted EBITDA of $1.9 million – an improvement of $6.2 million year over year

MASON, Ohio–(BUSINESS WIRE)–AtriCure, Inc. (Nasdaq: ATRC), a leading innovator in surgical treatments and therapies for atrial fibrillation (Afib), left atrial appendage (LAA) management and post-operative pain management, today announced first quarter 2023 financial results.

“We had an extraordinary start to 2023 driven by strength across our platforms globally. We are experiencing robust demand from physicians to treat patients and remain excited for the extensive opportunities in our markets,” said Michael Carrel, President and Chief Executive Officer of AtriCure. “As we look forward, we are focused on growing our patient impact, expanding clinical science and innovation, and increasing leverage across our operations.”

First Quarter 2023 Financial Results

Revenue for the first quarter 2023 was $93.5 million, an increase of 25.4% (an increase of 25.9% on a constant currency basis) over first quarter 2022 revenue. U.S. revenue was $78.2 million, an increase of $15.9 million or 25.6%, compared to first quarter 2022. U.S. revenue growth was driven by sales in all key product lines, highlighted by EnCompass® clamp in open ablation, cryoSPHERE® probe for post-operative pain management and AtriClip® Flex·V® in the appendage management franchise. International revenue increased $3.0 million or 24.4% (an increase of 27.7% on a constant currency basis) to $15.3 million, across all franchises and geographic regions. On a sequential basis, worldwide revenue for the first quarter 2023 increased approximately 6.2% from fourth quarter 2022.

Gross profit for the first quarter 2023 was $69.6 million compared to $55.6 million for the first quarter 2022. Gross margin was 74.5% for both the first quarters 2023 and 2022, with the current quarter reflecting leverage of our operations and production efficiencies, offset by continuing supply chain cost increases and shift in product mix. Loss from operations for the first quarter 2023 was $5.8 million, compared to $14.2 million for the first quarter 2022, reflecting strong revenue growth, improving leverage of our operating costs and a gain from legal settlement. Basic and diluted net loss per share was $0.14 for the first quarter 2023, compared to $0.33 for the first quarter 2022.

Adjusted EBITDA was positive for the first quarter 2023 at $1.9 million, compared to negative $4.2 million for first quarter of 2022. Adjusted loss per share for the first quarter 2023 was $0.23, compared to $0.33 for the first quarter 2022.

Constant currency revenue, adjusted EBITDA and adjusted loss per share are non-GAAP measures. We discuss these non-GAAP measures and provide reconciliations to GAAP measures later in this release.

2023 Financial Guidance

Full year 2023 revenue is projected to be $385 million to $392 million, reflecting growth of approximately 17% to 19% over full year 2022. Management now expects full year 2023 positive adjusted EBITDA of approximately $2 million, and full year 2023 adjusted loss per share of approximately $1.10 to $1.15.

Conference Call

AtriCure will host a conference call at 4:30 p.m. Eastern Time on Tuesday, May 2, 2023 to discuss its first quarter 2023 financial results. To access the webcast, please visit the Investors page of AtriCure’s corporate website at https://ir.atricure.com/events-and-presentations/events. Participants are encouraged to register more than 15 minutes before the webcast start time. A replay of the presentation will be available for 90 days following the presentation.

About AtriCure

AtriCure, Inc. provides innovative technologies for the treatment of Afib and related conditions. Afib affects more than 37 million people worldwide. Electrophysiologists and cardiothoracic surgeons around the globe use AtriCure technologies for the treatment of Afib and reduction of Afib related complications. AtriCure’s Isolator® Synergy™ Ablation System is the first medical device to receive FDA approval for the treatment of persistent Afib. AtriCure’s AtriClip® Left Atrial Appendage Exclusion System products are the most widely sold LAA management devices worldwide. AtriCure’s Hybrid AF™ Therapy is a minimally invasive procedure that provides a lasting solution for long-standing persistent Afib patients. AtriCure’s cryoICE cryoSPHERE® probe is cleared for temporary ablation of peripheral nerves to block pain, providing pain relief in cardiac and thoracic procedures. For more information, visit AtriCure.com or follow us on Twitter @AtriCure.

Forward-Looking Statements

This press release contains “forward-looking statements”– that is, statements related to future events that by their nature address matters that are uncertain. This press release also includes forward-looking projected financial information that is based on current estimates and forecasts. Actual results could differ materially. For details on the uncertainties that may cause our actual results to be materially different than those expressed in our forward-looking statements, visit http://www.atricure.com/forward-looking-statements as well as our Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q which contain risk factors. Except where otherwise noted, the information contained in this release is as of May 2, 2023. We assume no obligation to update any forward-looking statements contained in this release as a result of new information or future events or developments, except as may be required by law.

Use of Non-GAAP Financial Measures

To supplement AtriCure’s condensed consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP, AtriCure provides certain non-GAAP financial measures in this release as supplemental financial metrics.

Revenue reported on a constant currency basis is a non-GAAP measure, calculated by applying previous period foreign currency exchange rates to each of the comparable periods. Management analyzes revenue on a constant currency basis to better measure the comparability of results between periods. Because changes in foreign currency exchange rates have a non-operating impact on revenue, the Company believes that evaluating growth in revenue on a constant currency basis provides an additional and meaningful assessment of revenue to both management and investors.

Adjusted EBITDA is calculated as net loss before other income/expense (including interest), income tax expense, depreciation and amortization expense, share-based compensation expense, acquisition costs, legal settlement, impairment of intangible asset and change in fair value of contingent consideration liabilities. Management believes in order to properly understand short-term and long-term financial trends, investors may wish to consider the impact of these excluded items in addition to GAAP measures. The excluded items vary in frequency and/or impact on our continuing results of operations and management believes that the excluded items are typically not reflective of our ongoing core business operations and financial condition. Further, management uses adjusted EBITDA for both strategic and annual operating planning. A reconciliation of adjusted EBITDA reported in this release to the most comparable GAAP measure for the respective periods appears in the table captioned “Reconciliation of Non-GAAP Adjusted Income (Loss) (Adjusted EBITDA)” later in this release.

Adjusted loss per share is a non-GAAP measure which calculates the net loss per share before non-cash adjustments in fair value of contingent consideration liabilities, impairment of intangible asset and legal settlement. A reconciliation of adjusted loss income per share reported in this release to the most comparable GAAP measure for the respective periods appears in the table captioned “Reconciliation of Non-GAAP Adjusted Loss Per Share” later in this release.

The non-GAAP financial measures used by AtriCure may not be the same or calculated in the same manner as those used and calculated by other companies. Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as a substitute for AtriCure’s financial results prepared and reported in accordance with GAAP. We urge investors to review the reconciliation of these non-GAAP financial measures to the comparable GAAP financials measures included in this press release, and not to rely on any single financial measure to evaluate our business.

 

ATRICURE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In Thousands, Except Per Share Amounts)

(Unaudited)

 

 

Three Months Ended
March 31,

 

2023

 

 

 

2022

 

United States Revenue:

 

 

 

Open ablation

$

25,142

 

 

$

18,974

 

Minimally invasive ablation

 

9,637

 

 

 

8,615

 

Pain management

 

11,068

 

 

 

8,014

 

Total ablation

 

45,847

 

 

 

35,603

 

Appendage management

 

32,342

 

 

 

26,669

 

Total United States

 

78,189

 

 

 

62,272

 

International Revenue:

 

 

 

Open ablation

 

7,286

 

 

 

6,492

 

Minimally invasive ablation

 

1,867

 

 

 

1,533

 

Pain management

 

228

 

 

 

140

 

Total ablation

 

9,381

 

 

 

8,165

 

Appendage management

 

5,924

 

 

 

4,139

 

Total International

 

15,305

 

 

 

12,304

 

Total revenue

 

93,494

 

 

 

74,576

 

Cost of revenue

 

23,885

 

 

 

18,981

 

Gross profit

 

69,609

 

 

 

55,595

 

Operating expenses:

 

 

 

Research and development expenses

 

15,327

 

 

 

13,629

 

Selling, general and administrative expenses

 

60,064

 

 

 

56,116

 

Total operating expenses

 

75,391

 

 

 

69,745

 

Loss from operations

 

(5,782

)

 

 

(14,150

)

Other expense, net

 

(616

)

 

 

(977

)

Loss before income tax expense

 

(6,398

)

 

 

(15,127

)

Income tax expense

 

78

 

 

 

56

 

Net loss

$

(6,476

)

 

$

(15,183

)

Basic and diluted net loss per share

$

(0.14

)

 

$

(0.33

)

Weighted average shares used in computing net loss per share:

 

 

 

Basic and diluted

 

46,107

 

 

 

45,528

 

 

ATRICURE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In Thousands)

(Unaudited)

 

 

March 31,
2023

 

December 31,
2022

Assets

 

 

 

Current assets:

 

 

 

Cash, cash equivalents, and short-term investments

$

135,860

 

 

$

121,113

 

Accounts receivable, net

 

45,661

 

 

 

42,693

 

Inventories

 

48,848

 

 

 

45,931

 

Prepaid and other current assets

 

7,956

 

 

 

5,477

 

Total current assets

 

238,325

 

 

 

215,214

 

Long-term investments

 

25,561

 

 

 

51,509

 

Property and equipment, net

 

39,607

 

 

 

38,833

 

Operating lease right-of-use assets

 

4,605

 

 

 

3,787

 

Goodwill and intangible assets, net

 

273,382

 

 

 

274,120

 

Other noncurrent assets

 

1,620

 

 

 

1,985

 

Total assets

$

583,100

 

 

$

585,448

 

Liabilities and Stockholders’ Equity

 

 

 

Current liabilities:

 

 

 

Accounts payable and accrued liabilities

$

51,794

 

 

$

52,920

 

Current maturities of debt and leases

 

10,677

 

 

 

5,472

 

Total current liabilities

 

62,471

 

 

 

58,392

 

Long-term debt

 

51,940

 

 

 

56,834

 

Finance lease liabilities

 

8,883

 

 

 

9,147

 

Operating lease liabilities

 

3,725

 

 

 

3,095

 

Other noncurrent liabilities

 

1,236

 

 

 

1,226

 

Total liabilities

 

128,255

 

 

 

128,694

 

Stockholders’ equity:

 

 

 

Common stock

 

47

 

 

 

47

 

Additional paid-in capital

 

790,965

 

 

 

787,422

 

Accumulated other comprehensive loss

 

(3,072

)

 

 

(4,096

)

Accumulated deficit

 

(333,095

)

 

 

(326,619

)

Total stockholders’ equity

 

454,845

 

 

 

456,754

 

Total liabilities and stockholders’ equity

$

583,100

 

 

$

585,448

 

 

ATRICURE, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP RESULTS TO NON-GAAP RESULTS

(In Thousands)

(Unaudited)

 

Reconciliation of Non-GAAP Adjusted Income (Loss) (Adjusted EBITDA)

 

 

Three Months Ended
March 31,

 

2023

 

 

 

2022

 

Net loss, as reported

$

(6,476

)

 

$

(15,183

)

Income tax expense

 

78

 

 

 

56

 

Other expense, net

 

616

 

 

 

977

 

Depreciation and amortization expense

 

2,943

 

 

 

2,867

 

Share-based compensation expense

 

8,760

 

 

 

7,049

 

Gain from legal settlement

 

(4,000

)

 

 

 

Non-GAAP adjusted income (loss) (adjusted EBITDA)

$

1,921

 

 

$

(4,234

)

 

Reconciliation of Non-GAAP Adjusted Loss Per Share

 

 

Three Months Ended
March 31,

 

 

2023

 

 

 

2022

 

Net loss, as reported

$

(6,476

)

 

$

(15,183

)

Gain from legal settlement

 

(4,000

)

 

 

 

Non-GAAP adjusted net loss

$

(10,476

)

 

$

(15,183

)

Basic and diluted adjusted net loss per share

$

(0.23

)

 

$

(0.33

)

Weighted average shares used in computing adjusted net loss per share

 

 

 

Basic and diluted

 

46,107

 

 

 

45,528

 

 

Contacts

Angie Wirick

AtriCure, Inc.

Chief Financial Officer

(513) 755-5334

[email protected]

Lynn Lewis or Marissa Bych

Gilmartin Group

Investor Relations

[email protected]
[email protected]

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