ATRC AtriCure Inc

• Worldwide revenue of $100.9 million – an increase of 19.4% year over year
• U.S. revenue of $84.9 million – an increase of 19.1% year over year
• International revenue of $16.0 million – an increase of 20.7% year over year
• Net loss of $5.1 million – an improvement of $9.7 million year over year
• Positive adjusted EBITDA of $8.0 million – an improvement of $11.2 million year over year

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 second quarter 2023 financial results.

“We are proud to report an exceptional quarter at AtriCure, highlighted by robust worldwide growth and meaningful operating leverage. Our performance showcases the breadth of opportunities that exist in our business and an unwavering commitment from our team to raise patient impact,” said Michael Carrel, President, and Chief Executive Officer at AtriCure. “As we execute the second half of 2023, we remain focused on the expansion of our markets and continued advancement of clinical science and innovation.”

Second Quarter 2023 Financial Results

Revenue for the second quarter 2023 was $100.9 million, an increase of 19.4% (an increase of 19.3% on a constant currency basis) over second quarter 2022 revenue. U.S. revenue was $84.9 million, an increase of $13.6 million or 19.1%, compared to the second quarter 2022. U.S. revenue growth was driven by sales in all key product lines, highlighted by sales of the EnCompass® clamp in open ablation, cryoSPHERE® probe for post-operative pain management and the AtriClip® Flex·V® device in appendage management. International revenue increased $2.8 million or 20.7% (an increase of 19.9% on a constant currency basis) to $16.0 million, across all franchises and geographic regions. On a sequential basis, worldwide revenue for the second quarter 2023 increased approximately 7.9% from first quarter 2023.

Gross profit for the second quarter 2023 was $77.1 million compared to $63.5 million for the second quarter 2022. Gross margin was 76.4% for the second quarter 2023, showing improvement of 130 basis points from the second quarter 2022, with the current quarter reflecting leverage of our operations and production efficiencies, partially offset by pressure from geographic and product mix. Loss from operations for the second quarter 2023 was $4.1 million, compared to $13.7 million for the second quarter 2022, reflecting strong revenue growth, cost efficiencies, and improving operating leverage. Basic and diluted net loss per share was $0.11 for the second quarter 2023, compared to $0.32 for the second quarter 2022.

Adjusted EBITDA was positive for the second quarter 2023 at $8.0 million, compared to negative $3.2 million for second quarter of 2022. Adjusted loss per share for the second quarter 2023 was $0.12, compared to $0.32 for the second 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 $392 million to $395 million, reflecting growth of approximately 19% to 20% over full year 2022. Management now expects full year 2023 positive adjusted EBITDA of approximately $12 million, and full year 2023 adjusted loss per share of approximately $0.92 to $0.94.

Conference Call

AtriCure will host a conference call at 4:30 p.m. Eastern Time on Tuesday, July 25, 2023 to discuss second 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 July 25, 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 settlements, impairment of intangible assets 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 assets and legal settlements. 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 June 30,

 

Six Months Ended June 30,

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

United States Revenue:

 

 

 

 

 

 

 

Open ablation

$

27,002

 

 

$

22,070

 

 

$

52,144

 

 

$

41,044

 

Minimally invasive ablation

 

11,370

 

 

 

10,154

 

 

 

21,007

 

 

 

18,769

 

Pain management

 

12,590

 

 

 

10,210

 

 

 

23,658

 

 

 

18,224

 

Total ablation

 

50,962

 

 

 

42,434

 

 

 

96,809

 

 

 

78,037

 

Appendage management

 

33,941

 

 

 

28,831

 

 

 

66,283

 

 

 

55,500

 

Total United States

 

84,903

 

 

 

71,265

 

 

 

163,092

 

 

 

133,537

 

International Revenue:

 

 

 

 

 

 

 

Open ablation

 

7,722

 

 

 

6,213

 

 

 

15,008

 

 

 

12,705

 

Minimally invasive ablation

 

1,375

 

 

 

1,271

 

 

 

3,242

 

 

 

2,804

 

Pain management

 

439

 

 

 

114

 

 

 

667

 

 

 

254

 

Total ablation

 

9,536

 

 

 

7,598

 

 

 

18,917

 

 

 

15,763

 

Appendage management

 

6,479

 

 

 

5,666

 

 

 

12,403

 

 

 

9,805

 

Total International

 

16,015

 

 

 

13,264

 

 

 

31,320

 

 

 

25,568

 

Total revenue

 

100,918

 

 

 

84,529

 

 

 

194,412

 

 

 

159,105

 

Cost of revenue

 

23,841

 

 

 

21,010

 

 

 

47,726

 

 

 

39,991

 

Gross profit

 

77,077

 

 

 

63,519

 

 

 

146,686

 

 

 

119,114

 

Operating expenses:

 

 

 

 

 

 

 

Research and development expenses

 

17,438

 

 

 

14,791

 

 

 

32,765

 

 

 

28,420

 

Selling, general and administrative expenses

 

63,783

 

 

 

62,388

 

 

 

123,847

 

 

 

118,504

 

Total operating expenses

 

81,221

 

 

 

77,179

 

 

 

156,612

 

 

 

146,924

 

Loss from operations

 

(4,144

)

 

 

(13,660

)

 

 

(9,926

)

 

 

(27,810

)

Other expense, net

 

(881

)

 

 

(1,136

)

 

 

(1,497

)

 

 

(2,113

)

Loss before income tax expense

 

(5,025

)

 

 

(14,796

)

 

 

(11,423

)

 

 

(29,923

)

Income tax expense

 

93

 

 

 

45

 

 

 

171

 

 

 

101

 

Net loss

$

(5,118

)

 

$

(14,841

)

 

$

(11,594

)

 

$

(30,024

)

Basic and diluted net loss per share

$

(0.11

)

 

$

(0.32

)

 

$

(0.25

)

 

$

(0.66

)

Weighted average shares used in computing net loss per share:

 

 

 

 

 

 

 

Basic and diluted

 

46,266

 

 

 

45,692

 

 

 

46,187

 

 

 

45,610

 

ATRICURE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In Thousands)

(Unaudited)

June 30, 2023

 

December 31, 2022

Assets

 

 

 

Current assets:

 

 

 

Cash, cash equivalents, and short-term investments

$

127,025

 

 

$

121,113

 

Accounts receivable, net

 

48,362

 

 

 

42,693

 

Inventories

 

55,409

 

 

 

45,931

 

Prepaid and other current assets

 

7,179

 

 

 

5,477

 

Total current assets

 

237,975

 

 

 

215,214

 

Long-term investments

 

7,598

 

 

 

51,509

 

Property and equipment, net

 

40,540

 

 

 

38,833

 

Operating lease right-of-use assets

 

4,353

 

 

 

3,787

 

Goodwill and intangible assets, net

 

302,164

 

 

 

274,120

 

Other noncurrent assets

 

1,541

 

 

 

1,985

 

Total assets

$

594,171

 

 

$

585,448

 

Liabilities and Stockholders' Equity

 

 

 

Current liabilities:

 

 

 

Accounts payable and accrued liabilities

$

55,695

 

 

$

52,920

 

Current maturities of debt and leases

 

15,715

 

 

 

5,472

 

Total current liabilities

 

71,410

 

 

 

58,392

 

Long-term debt

 

47,047

 

 

 

56,834

 

Finance lease liabilities

 

8,614

 

 

 

9,147

 

Operating lease liabilities

 

3,458

 

 

 

3,095

 

Other noncurrent liabilities

 

1,220

 

 

 

1,226

 

Total liabilities

 

131,749

 

 

 

128,694

 

Stockholders' equity:

 

 

 

Common stock

 

47

 

 

 

47

 

Additional paid-in capital

 

803,197

 

 

 

787,422

 

Accumulated other comprehensive loss

 

(2,609

)

 

 

(4,096

)

Accumulated deficit

 

(338,213

)

 

 

(326,619

)

Total stockholders' equity

 

462,422

 

 

 

456,754

 

Total liabilities and stockholders' equity

$

594,171

 

 

$

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 June 30,

 

Six Months Ended June 30,

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

Net loss, as reported

$

(5,118

)

 

$

(14,841

)

 

$

(11,594

)

 

$

(30,024

)

Income tax expense

 

93

 

 

 

45

 

 

 

171

 

 

 

101

 

Other expense, net

 

881

 

 

 

1,136

 

 

 

1,497

 

 

 

2,113

 

Depreciation and amortization expense

 

3,580

 

 

 

2,937

 

 

 

6,523

 

 

 

5,804

 

Share-based compensation expense

 

8,995

 

 

 

7,524

 

 

 

17,755

 

 

 

14,573

 

Gain from legal settlement

 

(412

)

 

 

—

 

 

 

(4,412

)

 

 

—

 

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

$

8,019

 

 

$

(3,199

)

 

$

9,940

 

 

$

(7,433

)

Reconciliation of Non-GAAP Adjusted Loss Per Share

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

Net loss, as reported

$

(5,118

)

 

$

(14,841

)

 

$

(11,594

)

 

$

(30,024

)

Gain from legal settlement

 

(412

)

 

 

—

 

 

 

(4,412

)

 

 

—

 

Non-GAAP adjusted net loss

$

(5,530

)

 

$

(14,841

)

 

$

(16,006

)

 

$

(30,024

)

Basic and diluted adjusted net loss per share

$

(0.12

)

 

$

(0.32

)

 

$

(0.35

)

 

$

(0.66

)

Weighted average shares used in computing adjusted net loss per share

 

 

 

 

 

 

 

Basic and diluted

 

46,266

 

 

 

45,692

 

 

 

46,187

 

 

 

45,610

 

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20230725346350/en/

Angie Wirick AtriCure, Inc. Chief Financial Officer (513) 755-5334 awirick@atricure.com

Lynn Lewis or Marissa Bych Gilmartin Group Investor Relations lynn@gilmartinir.com marissa@gilmartinir.com