ATRC AtriCure Inc

• Worldwide revenue of $98.3 million – an increase of 18.1% year over year
• U.S. revenue of $81.7 million – an increase of 17.1% year over year
• International revenue of $16.6 million – an increase of 23.2% year over year
• Net loss of $9.1 million – an improvement of $3.2 million year over year
• Positive adjusted EBITDA of $4.7 million – an improvement of $5.4 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 third quarter 2023 financial results.

“We are excited to report another strong quarter at AtriCure, driven by the performance across our business globally. We also made progress against many strategic initiatives in our pillars of innovation, education and clinical science,” said Michael Carrel, President and Chief Executive Officer at AtriCure. “To that end, we continue to prioritize thoughtful investments while demonstrating meaningful operating leverage in our business. As we look to the future, we remain confident in the vast potential of our markets and our ability to deliver profitable growth.”

Third Quarter 2023 Financial Results

Revenue for the third quarter 2023 was $98.3 million, an increase of 18.1% over third quarter 2022 revenue (17.3% on a constant currency basis). Our worldwide revenue growth reflects continuing adoption of our products by physicians for the treatment of patients with Afib, LAA management and post-operative pain management.

U.S. revenue was $81.7 million, an increase of $11.9 million or 17.1%, compared to the third quarter 2022. U.S. revenue growth was driven by sales across 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 $3.1 million or 23.2% (18.7% on a constant currency basis) to $16.6 million, across all franchises and geographic regions. On a sequential basis, worldwide revenue for the third quarter 2023 decreased approximately 2.6% from the second quarter 2023 due to normal seasonality of procedures in summer months.

Gross profit for the third quarter 2023 was $73.9 million compared to $61.7 million for the third quarter 2022. Gross margin was 75.2% for the third quarter 2023, showing improvement of 110 basis points from the third quarter 2022. The current quarter reflects leverage of our operations and production efficiencies, partially offset by pressure from geographic and product mix. Loss from operations for the third quarter 2023 was $8.1 million, compared to $10.7 million for the third quarter 2022, reflecting strong revenue growth, cost efficiencies, and improving operating leverage. Basic and diluted net loss per share was $0.20 for the third quarter 2023, compared to $0.27 for the third quarter 2022.

Adjusted EBITDA was positive for the third quarter 2023 at $4.7 million, compared to negative $0.7 million for third quarter of 2022. Adjusted loss per share for the third quarter 2023 was $0.20, compared to $0.27 for the third 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 $394 million to $396 million, reflecting growth of approximately 19% to 20% over full year 2022. Management now expects full year 2023 positive adjusted EBITDA of approximately $18 million to $20 million, and full year 2023 adjusted loss per share of approximately $0.74 to $0.76.

Conference Call

AtriCure will host a conference call at 4:30 p.m. Eastern Time on Wednesday, November 1, 2023 to discuss third 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 November 1, 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 September 30,

 

Nine Months Ended September 30,

2023

 

2022

 

2023

 

2022

United States Revenue:

 

 

 

 

 

 

 

Open ablation

$

25,844

 

 

$

21,569

 

 

$

77,988

 

 

$

62,613

 

Minimally invasive ablation

 

10,893

 

 

 

10,077

 

 

 

31,900

 

 

 

28,846

 

Pain management

 

12,591

 

 

 

10,510

 

 

 

36,249

 

 

 

28,734

 

Total ablation

 

49,328

 

 

 

42,156

 

 

 

146,137

 

 

 

120,193

 

Appendage management

 

32,364

 

 

 

27,620

 

 

 

98,647

 

 

 

83,120

 

Total United States

 

81,692

 

 

 

69,776

 

 

 

244,784

 

 

 

203,313

 

International Revenue:

 

 

 

 

 

 

 

Open ablation

 

8,007

 

 

 

6,680

 

 

 

23,015

 

 

 

19,385

 

Minimally invasive ablation

 

1,578

 

 

 

1,445

 

 

 

4,820

 

 

 

4,249

 

Pain management

 

547

 

 

 

121

 

 

 

1,214

 

 

 

375

 

Total ablation

 

10,132

 

 

 

8,246

 

 

 

29,049

 

 

 

24,009

 

Appendage management

 

6,466

 

 

 

5,224

 

 

 

18,869

 

 

 

15,029

 

Total International

 

16,598

 

 

 

13,470

 

 

 

47,918

 

 

 

39,038

 

Total revenue

 

98,290

 

 

 

83,246

 

 

 

292,702

 

 

 

242,351

 

Cost of revenue

 

24,421

 

 

 

21,533

 

 

 

72,147

 

 

 

61,524

 

Gross profit

 

73,869

 

 

 

61,713

 

 

 

220,555

 

 

 

180,827

 

Operating expenses:

 

 

 

 

 

 

 

Research and development expenses

 

20,354

 

 

 

15,169

 

 

 

53,119

 

 

 

43,589

 

Selling, general and administrative expenses

 

61,604

 

 

 

57,267

 

 

 

185,451

 

 

 

175,771

 

Total operating expenses

 

81,958

 

 

 

72,436

 

 

 

238,570

 

 

 

219,360

 

Loss from operations

 

(8,089

)

 

 

(10,723

)

 

 

(18,015

)

 

 

(38,533

)

Other expense, net

 

(919

)

 

 

(1,503

)

 

 

(2,416

)

 

 

(3,616

)

Loss before income tax expense

 

(9,008

)

 

 

(12,226

)

 

 

(20,431

)

 

 

(42,149

)

Income tax expense

 

47

 

 

 

46

 

 

 

218

 

 

 

147

 

Net loss

$

(9,055

)

 

$

(12,272

)

 

$

(20,649

)

 

$

(42,296

)

Basic and diluted net loss per share

$

(0.20

)

 

$

(0.27

)

 

$

(0.45

)

 

$

(0.93

)

Weighted average shares used in computing net loss per share:

 

 

 

 

 

 

 

Basic and diluted

 

46,411

 

 

 

45,823

 

 

 

46,262

 

 

 

45,682

 

ATRICURE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In Thousands)

(Unaudited)

 

September 30, 2023

 

December 31, 2022

Assets

 

 

 

Current assets:

 

 

 

Cash, cash equivalents, and short-term investments

$

133,014

 

 

$

121,113

 

Accounts receivable, net

 

51,528

 

 

 

42,693

 

Inventories

 

61,894

 

 

 

45,931

 

Prepaid and other current assets

 

6,283

 

 

 

5,477

 

Total current assets

 

252,719

 

 

 

215,214

 

Long-term investments

 

—

 

 

 

51,509

 

Property and equipment, net

 

41,400

 

 

 

38,833

 

Operating lease right-of-use assets

 

4,043

 

 

 

3,787

 

Goodwill and intangible assets, net

 

300,465

 

 

 

274,120

 

Other noncurrent assets

 

1,644

 

 

 

1,985

 

Total assets

$

600,271

 

 

$

585,448

 

Liabilities and Stockholders' Equity

 

 

 

Current liabilities:

 

 

 

Accounts payable and accrued liabilities

$

61,836

 

 

$

52,920

 

Current maturities of debt and leases

 

20,702

 

 

 

5,472

 

Total current liabilities

 

82,538

 

 

 

58,392

 

Long-term debt

 

42,153

 

 

 

56,834

 

Finance and operating lease liabilities

 

11,520

 

 

 

12,242

 

Other noncurrent liabilities

 

1,227

 

 

 

1,226

 

Total liabilities

 

137,438

 

 

 

128,694

 

Stockholders' equity:

 

 

 

Common stock

 

47

 

 

 

47

 

Additional paid-in capital

 

812,238

 

 

 

787,422

 

Accumulated other comprehensive loss

 

(2,184

)

 

 

(4,096

)

Accumulated deficit

 

(347,268

)

 

 

(326,619

)

Total stockholders' equity

 

462,833

 

 

 

456,754

 

Total liabilities and stockholders' equity

$

600,271

 

 

$

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 September 30,

 

Nine Months Ended September 30,

2023

 

2022

 

2023

 

2022

Net loss, as reported

$

(9,055

)

 

$

(12,272

)

 

$

(20,649

)

 

$

(42,296

)

Income tax expense

 

47

 

 

 

46

 

 

 

218

 

 

 

147

 

Other expense, net

 

919

 

 

 

1,503

 

 

 

2,416

 

 

 

3,616

 

Depreciation and amortization expense

 

4,111

 

 

 

2,987

 

 

 

10,634

 

 

 

8,791

 

Share-based compensation expense

 

8,661

 

 

 

7,001

 

 

 

26,416

 

 

 

21,574

 

Net gain from legal settlements

 

—

 

 

 

—

 

 

 

(4,412

)

 

 

—

 

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

$

4,683

 

 

$

(735

)

 

$

14,623

 

 

$

(8,168

)

Reconciliation of Non-GAAP Adjusted Loss Per Share

 

 

Three Months Ended September 30,

 

Nine Months Ended September 30,

 

2023

 

2022

 

2023

 

2022

Net loss, as reported

$

(9,055

)

 

$

(12,272

)

 

$

(20,649

)

 

$

(42,296

)

Net gain from legal settlements

 

—

 

 

 

—

 

 

 

(4,412

)

 

 

—

 

Non-GAAP adjusted net loss

$

(9,055

)

 

$

(12,272

)

 

$

(25,061

)

 

$

(42,296

)

Basic and diluted adjusted net loss per share

$

(0.20

)

 

$

(0.27

)

 

$

(0.54

)

 

$

(0.93

)

Weighted average shares used in computing adjusted net loss per share

 

 

 

 

 

 

 

Basic and diluted

 

46,411

 

 

 

45,823

 

 

 

46,262

 

 

 

45,682

 

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20231101605552/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