Shockwave Medical, Inc. (Nasdaq: SWAV), a pioneer in the
development and commercialization of transformational technologies
for the treatment of cardiovascular disease, today reported
financial results for the three months ended March 31, 2024.
“The solid growth in the first quarter across
geographies and products is a testament to the continued demand for
our innovative solutions, driven by the unrelenting and
extraordinary performance of our global Shockwave teams,” said Doug
Godshall, President and Chief Executive Officer of Shockwave
Medical. “Our team is looking forward to continuing our mission as
part of Johnson & Johnson and to working together to bring our
life-changing therapies to even more patients across the
globe.”
First Quarter 2024 Financial Results
Revenue for the first quarter ended March 31, 2024, was $218.8
million, a 36% increase from $161.1 million in the same period of
2023. The growth in revenue was primarily driven by increased
adoption of Shockwave products in both the United States and
internationally.
Gross profit for the first quarter of 2024 was $190.6 million
compared to $140.0 million for the first quarter of 2023. Gross
margin percentage was 87% for the three months ended March 31,
2024, consistent with gross margin for the three months ended March
31, 2023.
Total operating expenses for the first quarter of 2024 were
$148.2 million, a 48% increase from $100.2 million in the first
quarter of 2023. The increase was primarily driven by sales force
expansion and higher headcount to support the growth of the
business.
Net income for the first quarter of 2024 was $55.3 million,
compared to net income of $39.1 million in the same period of 2023.
Basic and diluted net income per share for the first quarter of
2024 was $1.48 and $1.44, respectively.
Adjusted EBITDA improved by approximately 19% to $68.5 million,
in the first quarter of 2024, compared to adjusted EBITDA of $57.5
million in the first quarter of 2023. Adjusted EBITDA is a non-GAAP
measure.
Cash, cash equivalents and short-term investments totaled
$1,029.2 million as of March 31, 2024.
2024 Financial Guidance
Given the proposed acquisition of Shockwave Medical by Johnson
& Johnson (NYSE: JNJ), Shockwave Medical is withdrawing its
full year 2024 guidance, previously issued on February 15,
2024.
Conference Call
Given the proposed acquisition of Shockwave Medical by Johnson
& Johnson (NYSE: JNJ), Shockwave Medical will not be hosting
the previously scheduled earnings conference call today.
About Shockwave Medical, Inc.
Shockwave Medical is a leader in the development and
commercialization of innovative products that are transforming the
treatment of cardiovascular disease. Its first-of-its-kind
Intravascular Lithotripsy (IVL) technology has transformed the
treatment of atherosclerotic cardiovascular disease by safely using
sonic pressure waves to disrupt challenging calcified plaque,
resulting in significantly improved patient outcomes. Shockwave
Medical has also recently acquired the Reducer, which is under
clinical investigation in the United States and is CE Marked in the
European Union and the United Kingdom. By redistributing blood flow
within the heart, the Reducer is designed to provide relief to the
millions of patients worldwide suffering from refractory angina.
Learn more at www.shockwavemedical.com.
Forward-Looking Statements
This press release contains statements relating to our
expectations, projections, beliefs, and prospects, which are
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. In some cases, you can
identify these statements by forward-looking words such as “may,”
“might,” “will,” “should,” “expects,” “plans,” “anticipates,”
“believes,” “estimates,” “predicts,” “potential” or “continue,” and
similar expressions, and the negative of these terms.
Forward-looking statements in this press release include, but are
not limited to, statements regarding our pending acquisition by
Johnson & Johnson, our business strategy and plans, our
objectives for future operations and financial performance and
other matters. You are cautioned not to place undue reliance on
these forward-looking statements. Forward-looking statements are
only predictions based on our current expectations, estimates, and
assumptions, valid only as of the date they are made, and subject
to risks and uncertainties, some of which we are not currently
aware.
If underlying assumptions prove inaccurate or known or unknown
risks or uncertainties materialize, actual results could vary
materially from our expectations and projections. Risks and
uncertainties include, but are not limited to: the risk that the
closing conditions for the pending acquisition will not be
satisfied, including the risk that clearance under the
Hart-Scott-Rodino Antitrust Improvements Act or other applicable
antitrust laws will not be obtained; uncertainty as to the
percentage of our stockholders that will vote to approve the
proposed transaction; the possibility that the transaction will not
be completed in the expected timeframe or at all; potential adverse
effects to our business or the business of Johnson & Johnson
during the pendency of the transaction, such as employee departures
or distraction of management from business operations; the risk of
stockholder litigation relating to the transaction, including
resulting expense or delay; the potential that the expected
benefits and opportunities of the acquisition, if completed, may
not be realized or may take longer to realize than expected;
challenges inherent in product research and development, including
uncertainty of clinical success and obtaining regulatory approvals;
uncertainty of commercial success for new products; manufacturing
difficulties and delays; product efficacy or safety concerns
resulting in product recalls or regulatory action; economic
conditions, including currency exchange and interest rate
fluctuations; the risks associated with global operations;
competition, including technological advances, new products and
patents attained by competitors; challenges to patents; changes to
applicable laws and regulations, including tax laws and global
health care reforms; adverse litigation or government action;
changes in behavior and spending patterns or financial distress of
purchasers of health care services and products; and trends toward
health care cost containment. These factors, as well as others, are
discussed in our filings with the Securities and Exchange
Commission (SEC), including in the sections titled “Risk Factors”
in our most recent Annual Report on Form 10-K and subsequently
filed Quarterly Reports on Form 10-Q, and in our other reports
filed with the SEC. Except to the extent required by law, we do not
undertake to update any of these forward-looking statements after
the date hereof to conform these statements to actual results or
revised expectations.
Use of Non-GAAP Financial Measures
This press release contains supplemental financial information
determined by methods other than in accordance with accounting
principles generally accepted in the United States (GAAP),
including references to adjusted EBITDA, a non-GAAP financial
measure that excludes from net income the effects of income tax
(benefit) provision, other (expense) income, net, interest expense,
interest income, income (loss) from equity method investment,
depreciation and amortization, and stock-based compensation. We
believe the presentation of adjusted EBITDA is useful as it
provides visibility to our underlying continuing operating
performance by excluding the impact of certain items that are
non-cash in nature or not related to our core business
operations.
Our definition of adjusted EBITDA may differ from similarly
titled measures used by others. Adjusted EBITDA should be
considered supplemental to, and not a substitute for, financial
information prepared in accordance with GAAP. Because adjusted
EBITDA excludes the effect of items that increase or decrease our
reported results of operations, management strongly encourages
investors to review, when they become available, our consolidated
financial statements and publicly filed reports in their entirety.
A reconciliation of adjusted EBITDA to net income has been provided
in the financial statement tables included in this press release,
and investors are encouraged to review the reconciliation.
Media Contact: Scott
Shadiow+1.317.432.9210sshadiow@shockwavemedical.com
Investor Contact:Debbie Kasterdkaster@shockwavemedical.com
SHOCKWAVE MEDICAL, INC. |
Balance Sheet Data |
(in thousands) |
|
|
|
|
|
|
|
|
March 31,2024 |
|
December 31,2023 |
|
|
(Unaudited) |
|
|
|
ASSETS |
|
|
|
|
CURRENT ASSETS: |
|
|
|
|
|
Cash and cash equivalents |
|
$ |
281,674 |
|
|
$ |
328,422 |
Short-term investments |
|
|
747,559 |
|
|
|
662,132 |
Accounts receivable, net |
|
|
124,440 |
|
|
|
114,552 |
Inventory |
|
|
111,215 |
|
|
|
107,587 |
Prepaid expenses and other current assets |
|
|
10,462 |
|
|
|
12,567 |
Total current assets |
|
|
1,275,350 |
|
|
|
1,225,260 |
Operating lease right-of-use
assets |
|
|
34,919 |
|
|
|
29,707 |
Property and equipment,
net |
|
|
78,693 |
|
|
|
68,923 |
Equity method investment |
|
|
2,356 |
|
|
|
1,643 |
Intangible assets, net |
|
|
91,960 |
|
|
|
92,857 |
Goodwill |
|
|
39,568 |
|
|
|
39,568 |
Deferred tax assets |
|
|
111,900 |
|
|
|
99,169 |
Other assets |
|
|
9,001 |
|
|
|
9,436 |
TOTAL ASSETS |
|
$ |
1,643,747 |
|
|
$ |
1,566,563 |
LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
|
|
CURRENT LIABILITIES: |
|
|
|
|
Accounts payable |
|
$ |
9,843 |
|
|
$ |
8,868 |
Accrued liabilities |
|
|
78,838 |
|
|
|
91,696 |
Lease liability, current portion |
|
|
3,653 |
|
|
|
3,641 |
Total current liabilities |
|
|
92,334 |
|
|
|
104,205 |
Lease liability, noncurrent
portion |
|
|
40,336 |
|
|
|
35,103 |
Convertible debt, noncurrent
portion |
|
|
732,810 |
|
|
|
731,863 |
Related party contract
liability, noncurrent portion |
|
|
12,273 |
|
|
|
12,273 |
Deferred tax liabilities |
|
|
3,609 |
|
|
|
3,609 |
Long-term income tax
liability |
|
|
2,969 |
|
|
|
1,526 |
Other liabilities |
|
|
7,659 |
|
|
|
9,307 |
TOTAL LIABILITIES |
|
|
891,990 |
|
|
|
897,886 |
STOCKHOLDERS’ EQUITY: |
|
|
|
|
Common stock |
|
|
38 |
|
|
|
37 |
Additional paid-in
capital |
|
|
586,017 |
|
|
|
557,882 |
Accumulated other
comprehensive (loss) income |
|
|
(109 |
) |
|
|
293 |
Retained earnings |
|
|
165,811 |
|
|
|
110,465 |
TOTAL STOCKHOLDERS’
EQUITY |
|
|
751,757 |
|
|
|
668,677 |
TOTAL LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
$ |
1,643,747 |
|
|
$ |
1,566,563 |
SHOCKWAVE MEDICAL, INC. |
Statement of Operations Data |
(Unaudited) |
(in thousands, except share and per share
data) |
|
|
|
Three Months Ended |
|
|
March 31, |
|
|
|
2024 |
|
|
|
2023 |
|
Revenue: |
|
|
|
|
Product revenue |
|
$ |
218,805 |
|
|
$ |
161,066 |
|
Cost of revenue: |
|
|
|
|
Cost of product revenue |
|
|
28,207 |
|
|
|
21,066 |
|
Gross profit |
|
|
190,598 |
|
|
|
140,000 |
|
Operating expenses: |
|
|
|
|
Research and development |
|
|
44,466 |
|
|
|
26,971 |
|
Sales and marketing |
|
|
74,492 |
|
|
|
54,011 |
|
General and administrative |
|
|
29,233 |
|
|
|
19,204 |
|
Total operating expenses |
|
|
148,191 |
|
|
|
100,186 |
|
Income from operations |
|
|
42,407 |
|
|
|
39,814 |
|
Income (loss) from equity
method investment |
|
|
713 |
|
|
|
(823 |
) |
Interest income |
|
|
12,318 |
|
|
|
1,740 |
|
Interest expense |
|
|
(2,943 |
) |
|
|
(636 |
) |
Other (expense) income,
net |
|
|
(2,496 |
) |
|
|
642 |
|
Net income before taxes |
|
|
49,999 |
|
|
|
40,737 |
|
Income tax (benefit)
provision |
|
|
(5,347 |
) |
|
|
1,612 |
|
Net income |
|
$ |
55,346 |
|
|
$ |
39,125 |
|
Net income per share,
basic |
|
$ |
1.48 |
|
|
$ |
1.07 |
|
Net income per share,
diluted |
|
$ |
1.44 |
|
|
$ |
1.03 |
|
Shares used in computing net
income per share, basic |
|
|
37,284,946 |
|
|
|
36,427,263 |
|
Shares used in computing net
income per share, diluted |
|
|
38,472,013 |
|
|
|
37,979,448 |
|
SHOCKWAVE MEDICAL, INC. |
Reconciliation of GAAP Net Income to Adjusted
EBITDA |
(Unaudited) |
(in thousands) |
|
|
|
Three Months Ended |
|
|
March 31, |
|
|
|
2024 |
|
|
|
2023 |
|
GAAP Net Income |
|
$ |
55,346 |
|
|
$ |
39,125 |
|
Non-GAAP Adjustments |
|
|
|
|
Income tax (benefit) provision |
|
|
(5,347 |
) |
|
|
1,612 |
|
Other expense (income), net |
|
|
2,496 |
|
|
|
(642 |
) |
Interest expense |
|
|
2,943 |
|
|
|
636 |
|
Interest income |
|
|
(12,318 |
) |
|
|
(1,740 |
) |
(Income) loss from equity method investment |
|
|
(713 |
) |
|
|
823 |
|
Depreciation and amortization |
|
|
3,109 |
|
|
|
1,708 |
|
Stock-based compensation expense |
|
|
22,937 |
|
|
|
15,967 |
|
Adjusted EBITDA |
|
$ |
68,453 |
|
|
$ |
57,489 |
|
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