Pulmonx Corp (LUNG) Q4 2024 Earnings Call Highlights: Strong Revenue Growth Amid Financial ...

GuruFocus.com
20 Feb
  • Worldwide Revenue (Q4 2024): $23.8 million, a 23% increase year-over-year.
  • Full Year 2024 Revenue: $83.8 million, a 22% increase over 2023.
  • US Revenue (Q4 2024): $15.9 million, a 16% increase year-over-year.
  • International Revenue (Q4 2024): $7.9 million, a 42% increase year-over-year.
  • Gross Margin (Q4 2024): 74%, compared to 75% in the prior year period.
  • Total Operating Expenses (Q4 2024): $31 million, a 9% increase year-over-year.
  • Net Loss (Q4 2024): $13.2 million, or $0.33 per share.
  • Adjusted EBITDA Loss (Q4 2024): $7.5 million, a 10% improvement year-over-year.
  • Cash Equivalents and Marketable Securities (End of 2024): $101.5 million.
  • 2025 Revenue Guidance: Expected between $96 million and $98 million.
  • 2025 Gross Margin Guidance: Approximately 74%.
  • 2025 Operating Expenses Guidance: Between $133 million and $135 million.
  • Warning! GuruFocus has detected 5 Warning Signs with LUNG.

Release Date: February 19, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • Pulmonx Corp (NASDAQ:LUNG) reported a 23% increase in worldwide sales for Q4 2024, reaching $23.8 million, driven by strong US and international sales growth.
  • The company added 52 new centers in the US in 2024, ending the year with 283 active accounts, indicating successful expansion of its US account base.
  • Pulmonx Corp (NASDAQ:LUNG) launched the Lung Tracks platform to streamline customer workflows and identify eligible patients, showing innovation in patient management.
  • The company reported successful clinical trial results, with 77.6% of patients showing successful conversion of collateral ventilation status after treatment.
  • Pulmonx Corp (NASDAQ:LUNG) achieved a 22% growth in full-year 2024 worldwide revenue, reflecting substantial progress in commercial initiatives and market expansion.

Negative Points

  • Despite strong revenue growth, Pulmonx Corp (NASDAQ:LUNG) reported a net loss of $13.2 million for Q4 2024, indicating ongoing financial challenges.
  • The company's gross margin for Q4 2024 was 74%, slightly down from 75% in the prior year period, suggesting pressure on profitability.
  • Operating expenses increased by 9% in Q4 2024, driven by higher clinical expenses and commercial investments, impacting overall financial performance.
  • Pulmonx Corp (NASDAQ:LUNG) anticipates a negative impact of approximately 100 basis points on 2025 reported revenue due to foreign exchange fluctuations.
  • The company expects 2025 revenue growth to be below its long-term target of 20%, with guidance set at 16-18% constant currency growth, indicating potential challenges in achieving its growth objectives.

Q & A Highlights

Q: Can you provide more details on the expected growth rate for 2025, particularly the difference between the first and second halves of the year? A: Mehul Joshi, Chief Financial Officer, explained that while they do not provide specific guidance for the first versus the second half, they expect strong international growth in the first half due to initiatives from 2024. In the U.S., growth is expected to accelerate in the second half as pilot initiatives are fully implemented.

Q: What feedback have you received from the Lung Tracks pilot, and how is it impacting utilization at centers? A: Steven Williamson, President and CEO, noted that customers appreciate the ability to passively find new patients. The integration and interface have been positively received, and initial data aligns with expectations. The pilot's success has led to plans for broader rollout in the second quarter.

Q: Can you elaborate on the significant international growth in Q4 and whether it included any one-time orders? A: Mehul Joshi stated that the growth was broad-based across European and Chinese markets, with no significant one-time stocking orders. The growth was driven by recurring business and strategic initiatives in these regions.

Q: Why is the 2025 growth guidance below the long-term target of 20%, and when do you expect to reach that target? A: Steven Williamson explained that the 17% midpoint guidance for 2025 is conservative, considering the time needed to implement new initiatives. They expect growth to accelerate in the latter half of 2025 and continue into 2026 with additional drivers like the Japanese post-approval study and Aeroseal launch.

Q: How are you measuring the effectiveness of your investments in new centers, salespeople, and direct-to-consumer campaigns? A: Steven Williamson mentioned that they track patient acquisition through their website and measure the efficiency of therapy awareness specialists by the number of referrals from COPD community physicians. They continuously assess these metrics to ensure effective investment.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

This article first appeared on GuruFocus.

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