We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Nevro's (NVRO) Q2 Earnings Beat Estimates, Revenues Down Y/Y
Read MoreHide Full Article
Nevro Corp. (NVRO - Free Report) reported a loss per share of 53 cents in the second quarter of 2024, narrower than the year-ago quarter’s loss of 69 cents. The metric beat the Zacks Consensus Estimate of a loss per share of 63 cents.
Revenues in Detail
Nevro registered worldwide revenues of $104.2 million in the second quarter, down 4.3% year over year on a reported basis and 4.2% on a constant-currency basis. The year-over-year decline was primarily due to the result of competitive pressures in the U.S. spinal cord stimulation (SCS) market and ongoing softness in the core U.S. SCS market. The figure missed the Zacks Consensus Estimate by 2.76%.
Quarterly Highlights
In the quarter under review, international revenues were $13.5 million, down 15% year over year on a reported basis and 14.5% at a constant exchange rate (CER). The year-over-year decline was primarily due to the short-term impact of negative SCS-related media reports in Australia that resulted in the postponement and cancelation of cases, as well as the impact of healthcare reform in Germany that caused a delay in procedures in the second quarter of 2024.
U.S. revenues for the quarter totaled $90.7 million, down 2.4% year over year.
Total U.S. permanent implant procedures declined 6.5% year over year, while U.S. trial procedures decreased 9.5% year over year. The year-over-year decrease in U.S. trials was primarily driven by competitive pressures and ongoing softness in the core U.S. SCS market during the quarter.
During the second quarter, Nevro presented a biomechanical analysis at the American Society of Pain & Neuroscience 2024 Annual Conference, showing that Nevro1, one of the company's sacroiliac joint (SI) fusion products, provides a significantly better opportunity for robust arthrodesis of the SI joint compared to competing devices as it relates to fixation, invasiveness and fusion surface area.
Margin Trend
In the quarter under review, Nevro’s gross profit declined 9.4% year over year to $67.5 million. Gross profit in the second quarter included a $6 million one-time charge related to the renegotiation of a supplier contract as the company works to expedite the move of its manufacturing processes to its Costa Rica manufacturing facility. Excluding this charge, gross profit was $73.5 million in the second quarter of 2024. The gross margin in the second quarter of 2024 was 64.8% (70.5% excluding the supplier contract renegotiation charge) compared with 68.4% in the prior-year quarter.
Sales, general & administrative expenses decreased 12% to $76.8 million. Research and development expenses increased 6% to $14.1 million. Operating expenses for the second quarter of 2024 include a $4.6 million charge related to the company's May 2024 restructuring and $1.7 million in intangible amortization and contingent consideration revaluations associated with Nevro's acquisition of Vyrsa Technologies, offset by a $4.1 million reduction in litigation-related expenses.
The total operating loss in the reported quarter was $25.1 million ($17 million excluding the charge related to the supplier contract renegotiation, the May 2024 restructuring charge, intangible amortization, contingent consideration revaluations, and year-over-year decrease in litigation-related expenses) compared with $25.6 million in the year-ago quarter.
Financial Position
Nevro exited the second quarter of 2024 with cash and cash equivalents and short-term investments of $273.7 million compared with $281.5 million at the end of the first quarter. Long-term debt at the end of second-quarter 2024 was $180.6 million compared with $214.8 million at the first-quarter end.
Guidance
Nevro has provided its financial outlook for full-year and third-quarter 2024.
For the third quarter of 2024, Nevro expects its worldwide revenues to be in the range of $92 million-$94 million, reflecting a decline of 9-11% year over year on a reported basis. The Zacks Consensus Estimate is pegged at $108.4 million.
The company expects its 2024 worldwide revenues in the range of $400 million-$405 million compared with the previous guidance range of $435 million to $445 million. The company's revised guidance assumes that U.S. SCS trialing growth rates are not likely to improve from the second quarter of 2024. The Zacks Consensus Estimate is pegged at $438.9 million.
Nevro exited the second quarter of 2024 with mixed results, where earnings beat, and revenues missed the Zacks Consensus Estimate. The company’s second-quarter revenues were hurt by ongoing softness in the U.S. SCS market and competitive pressures. Total U.S. permanent implant procedures, as well as U.S. trial procedures, declined in the second quarter.
Price Performance
Lower-than-expected revenues raised apprehension among investors, leading to a 32.1% decline in NVRO stock in after-market trading. Shares of the company have lost 59.6% against the industry’s 3.6% growth in the year-to-date period.
Image Source: Zacks Investment Research
Zacks Rank and Key Picks
Nevro currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the broader medical space that have announced quarterly results are Boston Scientific Corporation (BSX - Free Report) , Hologic (HOLX - Free Report) and Universal Health Services (UHS - Free Report) .
Boston Scientific reported second-quarter 2024 adjusted EPS of 62 cents, which beat the Zacks Consensus Estimate by 6.9%. Revenues of $4.12 billion surpassed the Zacks Consensus Estimate by 2.5%. It currently carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Boston Scientific has a long-term growth rate of 12.5%. BSX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 7.18%.
Hologic, carrying a Zacks Rank of 2 at present, has a long-term growth rate of 7.4%. Its earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 4.50%.
Hologic reported second-quarter 2024 adjusted EPS of $1.06, which beat the Zacks Consensus Estimate by 3.9%. Revenues of $1 billion surpassed the Zacks Consensus Estimate by 1.1%.
Universal Health Services reported second-quarter 2024 adjusted EPS of $4.31, which beat the Zacks Consensus Estimate by 27.9%. Revenues of $3.9 billion surpassed the Zacks Consensus Estimate by 1.5%. It currently sports a Zacks Rank of 1.
Universal Health Services has a long-term growth rate of 18%. UHS’ earnings surpassed estimates in each of the trailing four quarters, the average surprise being 14.58%.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Nevro's (NVRO) Q2 Earnings Beat Estimates, Revenues Down Y/Y
Nevro Corp. (NVRO - Free Report) reported a loss per share of 53 cents in the second quarter of 2024, narrower than the year-ago quarter’s loss of 69 cents. The metric beat the Zacks Consensus Estimate of a loss per share of 63 cents.
Revenues in Detail
Nevro registered worldwide revenues of $104.2 million in the second quarter, down 4.3% year over year on a reported basis and 4.2% on a constant-currency basis. The year-over-year decline was primarily due to the result of competitive pressures in the U.S. spinal cord stimulation (SCS) market and ongoing softness in the core U.S. SCS market. The figure missed the Zacks Consensus Estimate by 2.76%.
Quarterly Highlights
In the quarter under review, international revenues were $13.5 million, down 15% year over year on a reported basis and 14.5% at a constant exchange rate (CER). The year-over-year decline was primarily due to the short-term impact of negative SCS-related media reports in Australia that resulted in the postponement and cancelation of cases, as well as the impact of healthcare reform in Germany that caused a delay in procedures in the second quarter of 2024.
U.S. revenues for the quarter totaled $90.7 million, down 2.4% year over year.
Total U.S. permanent implant procedures declined 6.5% year over year, while U.S. trial procedures decreased 9.5% year over year. The year-over-year decrease in U.S. trials was primarily driven by competitive pressures and ongoing softness in the core U.S. SCS market during the quarter.
During the second quarter, Nevro presented a biomechanical analysis at the American Society of Pain & Neuroscience 2024 Annual Conference, showing that Nevro1, one of the company's sacroiliac joint (SI) fusion products, provides a significantly better opportunity for robust arthrodesis of the SI joint compared to competing devices as it relates to fixation, invasiveness and fusion surface area.
Margin Trend
In the quarter under review, Nevro’s gross profit declined 9.4% year over year to $67.5 million. Gross profit in the second quarter included a $6 million one-time charge related to the renegotiation of a supplier contract as the company works to expedite the move of its manufacturing processes to its Costa Rica manufacturing facility. Excluding this charge, gross profit was $73.5 million in the second quarter of 2024. The gross margin in the second quarter of 2024 was 64.8% (70.5% excluding the supplier contract renegotiation charge) compared with 68.4% in the prior-year quarter.
Sales, general & administrative expenses decreased 12% to $76.8 million. Research and development expenses increased 6% to $14.1 million. Operating expenses for the second quarter of 2024 include a $4.6 million charge related to the company's May 2024 restructuring and $1.7 million in intangible amortization and contingent consideration revaluations associated with Nevro's acquisition of Vyrsa Technologies, offset by a $4.1 million reduction in litigation-related expenses.
The total operating loss in the reported quarter was $25.1 million ($17 million excluding the charge related to the supplier contract renegotiation, the May 2024 restructuring charge, intangible amortization, contingent consideration revaluations, and year-over-year decrease in litigation-related expenses) compared with $25.6 million in the year-ago quarter.
Financial Position
Nevro exited the second quarter of 2024 with cash and cash equivalents and short-term investments of $273.7 million compared with $281.5 million at the end of the first quarter. Long-term debt at the end of second-quarter 2024 was $180.6 million compared with $214.8 million at the first-quarter end.
Guidance
Nevro has provided its financial outlook for full-year and third-quarter 2024.
For the third quarter of 2024, Nevro expects its worldwide revenues to be in the range of $92 million-$94 million, reflecting a decline of 9-11% year over year on a reported basis. The Zacks Consensus Estimate is pegged at $108.4 million.
The company expects its 2024 worldwide revenues in the range of $400 million-$405 million compared with the previous guidance range of $435 million to $445 million. The company's revised guidance assumes that U.S. SCS trialing growth rates are not likely to improve from the second quarter of 2024. The Zacks Consensus Estimate is pegged at $438.9 million.
Nevro Corp. Price, Consensus and EPS Surprise
Nevro Corp. price-consensus-eps-surprise-chart | Nevro Corp. Quote
Our Take
Nevro exited the second quarter of 2024 with mixed results, where earnings beat, and revenues missed the Zacks Consensus Estimate. The company’s second-quarter revenues were hurt by ongoing softness in the U.S. SCS market and competitive pressures. Total U.S. permanent implant procedures, as well as U.S. trial procedures, declined in the second quarter.
Price Performance
Lower-than-expected revenues raised apprehension among investors, leading to a 32.1% decline in NVRO stock in after-market trading. Shares of the company have lost 59.6% against the industry’s 3.6% growth in the year-to-date period.
Image Source: Zacks Investment Research
Zacks Rank and Key Picks
Nevro currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the broader medical space that have announced quarterly results are Boston Scientific Corporation (BSX - Free Report) , Hologic (HOLX - Free Report) and Universal Health Services (UHS - Free Report) .
Boston Scientific reported second-quarter 2024 adjusted EPS of 62 cents, which beat the Zacks Consensus Estimate by 6.9%. Revenues of $4.12 billion surpassed the Zacks Consensus Estimate by 2.5%. It currently carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Boston Scientific has a long-term growth rate of 12.5%. BSX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 7.18%.
Hologic, carrying a Zacks Rank of 2 at present, has a long-term growth rate of 7.4%. Its earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 4.50%.
Hologic reported second-quarter 2024 adjusted EPS of $1.06, which beat the Zacks Consensus Estimate by 3.9%. Revenues of $1 billion surpassed the Zacks Consensus Estimate by 1.1%.
Universal Health Services reported second-quarter 2024 adjusted EPS of $4.31, which beat the Zacks Consensus Estimate by 27.9%. Revenues of $3.9 billion surpassed the Zacks Consensus Estimate by 1.5%. It currently sports a Zacks Rank of 1.
Universal Health Services has a long-term growth rate of 18%. UHS’ earnings surpassed estimates in each of the trailing four quarters, the average surprise being 14.58%.