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Business Wire 31-Jan-2024 4:00 PM
Unveils Next-Generation iTero Lumina™ Intraoral Scanner Featuring a 3X Wider Field of Capture1 in a 50% Smaller Wand2 that Delivers Faster Scanning, Higher Accuracy3, and Superior Visualization4 for Greater Practice Efficiency
Q4 and FY2023 total revenues up 6.1% year over year and up 3.4% year over year, respectively
Major 2023 milestones: 17 million Invisalign® patients, 4 million Vivera™ retainers, and 100 thousand iTero™ scanner units
Align Technology, Inc. (NASDAQ:ALGN), a leading global medical device company that designs, manufactures, and sells the Invisalign® system of clear aligners, iTero™ intraoral scanners, and exocad™ CAD/CAM software for digital orthodontics and restorative dentistry, today reported financial results for the fourth quarter ("Q4'23") and year ended December 31, 2023 ("2023"). Q4'23 total revenues were $956.7 million, down 0.4% sequentially and up 6.1% year-over-year. Q4'23 Clear Aligner revenues were $781.9 million, down 1.6% sequentially and up 6.9% year-over-year. Q4'23 Clear Aligner volume was down 1.6% sequentially and down 0.6% year-over-year. Q4'23 Imaging Systems and CAD/CAM Services revenues were $174.8 million, up 5.8% sequentially and up 2.9% year-over-year. Q4'23 Clear Aligner revenues were unfavorably impacted by foreign exchange of approximately $10.7 million or 1.4% sequentially and favorably impacted by approximately $12.0 million or 1.6% year over year.(5) Q4'23 Imaging Systems and CAD/CAM Services revenues were unfavorably impacted by foreign exchange of approximately $2.1 million or 1.2% sequentially and favorably impacted by approximately $1.9 million or 1.1% year over year.(5) Q4'23 operating income was $171.5 million resulting in an operating margin of 17.9%. Q4'23 operating margin was unfavorably impacted by foreign exchange of approximately 0.6 points sequentially and favorably impacted by approximately 0.6 points year over year.(5) Q4'23 net income was $124.0 million, or $1.64 per diluted share. On a non-GAAP basis, Q4'23 net income was $183.5 million, or $2.42 per diluted share.
2023 Clear Aligner revenues of $3.2 billion were unfavorably impacted by foreign exchange of approximately $29.7 million or 0.9% compared to 2022.(5) 2023 Imaging Systems and CAD/CAM Services revenues of $662.9 million were unfavorably impacted by foreign exchange of approximately $6.6 million or 1.0% compared to 2022.(5) During Q4'23, we incurred a total of $14.0 million of restructuring and other charges, primarily related to post-employment benefits.
Commenting on Align's Q4'23 and 2023 results, Align Technology President and CEO Joe Hogan said, "I am pleased to report fourth quarter results with better-than-expected revenues and earnings, primarily reflecting a sequential increase in clear aligner volume for adults and non-comprehensive cases, growth in Canada and the EMEA region, as well as increased revenues from systems and services. Fourth quarter revenues were up year-over-year primarily reflecting an increase in clear aligner volumes for teens and Invisalign DSP touch-up cases, as well as growth in the EMEA and APAC regions. For fiscal 2023, total revenues were up year over year, and we delivered fiscal 2023 non-GAAP operating margin above 21%, as expected. As of Q4, we achieved 17 million Invisalign® patients—including 4.7 million teens, as well as 4 million Vivera™ retainer cases, and over 100 thousand iTero™ scanners sold."
Hogan continued by announcing the launch of the company's latest iTero Lumina scanner, "Today, I'm excited to unveil a breakthrough technology — the iTero Lumina™ intraoral scanner - with 3X wider field of capture in a 50% smaller wand that delivers faster scanning, higher accuracy, and superior visualization for greater practice efficiency. iTero Lumina quickly, easily, and accurately captures more data while delivering exceptional scan quality and photorealistic visuals that remove the need for intraoral photos altogether. Doctors can now scan at twice the speed with a wide field of capture, multi angled scanning, and a large capture distance, meaning they can capture more dentition in greater detail throughout the scanning process. Align has filed over 30 patent applications covering technology related to the iTero Lumina intraoral scanner. I believe iTero Lumina has the potential to set a new standard of care for dental practices by simplifying the scanning of complex oral regions, while offering superior chair-side visualization and a more comfortable experience for patients, especially kids."
(1) Compared to the field of view of the iTero Element™ 5D imaging system, when the iTero Lumina™ intraoral scanner's scanning distance is 12 mm.* (2) Compared to iTero Element™ 5D imaging system wand, excluding the wand cable.* (3) The iTero Lumina™ intraoral scanner has scientifically proven greater accuracy* for your clinical orthodontic needs. (4) For Invisalign record-taking cases only. Based on a survey in September 2023 of n=22 users who participated in a global limited market release, working with iTero Lumina™ intraoral scanner for an average period of 6 months, representing both Invisalign trained general practitioners and orthodontists in NA, EU and APAC, who were presented with a 4 point level of agreement scale from strongly agree to strongly disagree with the following statements: "iTero Lumina™ intraoral scanner 3D model is comparable to that of an intraoral photo." and "iTero Lumina™ intraoral scanner photorealistic scans enable orthodontic clinical assessment the same way intraoral photos do." and "iTero Lumina™ intraoral scanner 3D model's superior 3D model eliminates the need to take intraoral photos." and "iTero Lumina™ intraoral scanner 3D model's superior 3D model boosts patient engagement."* *Data on file at Align Technology, as of November 15, 2023. (5) For more information, please see the tables captioned "Unaudited GAAP to Non-GAAP Reconciliation."
Financial Summary - Fourth Quarter Fiscal 2023
|
Q4'23 |
|
Q3'23 |
|
Q4'22 |
|
Q/Q Change |
|
Y/Y Change |
Clear Aligner Shipments* |
592,635 |
|
602,335 |
|
596,155 |
|
(1.6)% |
|
(0.6)% |
GAAP |
|
|
|
|
|
|
|
|
|
Net Revenues |
$956.7M |
|
$960.2M |
|
$901.5M |
|
(0.4)% |
|
+6.1% |
Clear Aligner |
$781.9M |
|
$794.9M |
|
$731.7M |
|
(1.6)% |
|
+6.9% |
Imaging Systems and CAD/CAM Services |
$174.8M |
|
$165.3M |
|
$169.9M |
|
+5.8% |
|
+2.9% |
Net Income |
$124.0M |
|
$121.4M |
|
$41.8M |
|
+2.1% |
|
+196.9% |
Diluted EPS |
$1.64 |
|
$1.58 |
|
$0.54 |
|
+$0.06 |
|
+$1.10 |
Non-GAAP |
|
|
|
|
|
|
|
|
|
Net Income(6) |
$183.5M |
|
$164.3M |
|
$134.2M |
|
+11.7% |
|
+36.7% |
Diluted EPS(6) |
$2.42 |
|
$2.14 |
|
$1.73 |
|
+$0.28 |
|
+$0.69 |
Financial Summary - Fiscal 2023
|
2023 |
|
2022 |
|
Y/Y Change |
Clear Aligner Shipments* |
2,408,520 |
|
2,398,370 |
|
+0.4% |
GAAP |
|
|
|
|
|
Net Revenues |
$3,862.3M |
|
$3,734.6M |
|
+3.4% |
Clear Aligner |
$3,199.3M |
|
$3,072.6M |
|
+4.1% |
Imaging Systems and CAD/CAM Services |
$662.9M |
|
$662.1M |
|
+0.1% |
Net Income |
$445.1M |
|
$361.6M |
|
+23.1% |
Diluted EPS |
$5.81 |
|
$4.61 |
|
+$1.20 |
Non-GAAP |
|
|
|
|
|
Net Income(6) |
$659.2M |
|
$608.2M |
|
+8.4% |
Diluted EPS(6) |
$8.61 |
|
$7.76 |
|
+$0.85 |
Changes and percentages are based on actual values. Certain tables may not sum or recalculate due to rounding. *Clear Aligner shipments include Doctor Subscription Program Touch-Up cases.
(6) In Q4'22, we changed our methodology for the computation of the non-GAAP effective tax rate to a long-term projected tax rate and have given effect to the new methodology from January 1, 2022.
As of December 31, 2023, we had $980.8 million in cash, cash equivalents and short-term and long-term marketable securities compared to over $1.3 billion as of September 30, 2023. As of December 31, 2023, we had $300.0 million available under a revolving line of credit.
Commenting on Align's 2023 results, Align Technology CFO and EVP Global Finance, John Morici said, "I am pleased with our fourth quarter and fiscal 2023 results, and I am especially proud of our continued focused execution of our product roadmap and innovation pipeline. We are committed to delivering on our strategic growth drivers of International Expansion, Patient Demand, Orthodontist Utilization, and GP Dentist Treatment to extend our leadership in digital orthodontics and dentistry. I believe that the next wave of innovation that we are introducing into the market will further differentiate Align and allow us to increase our share of the large untapped market opportunity of 22 million annual orthodontic case starts as well as the additional 600 million consumers who could benefit from a healthy beautiful smile using Invisalign® clear aligners."
Q4'23 Announcement Highlights
*Based on a survey in August 2023 in Canada of 10 Invisalign trained orthodontists who participated in the IPE system Technical Design Assessment and have treated at least 1 patient age 6-11 years with IPE. Data on file at Align Technology, Inc. as of October 30, 2023.
Q4'23 Stock Repurchases
In October 2023, we purchased approximately 1.0 million shares of our common stock at an average price of $190.56 per share through a $250.0 million Accelerated Share Repurchase* and, in November and December 2023, we purchased approximately 466 thousand shares of our common stock at an average price of $214.81 per share through $100.0 million open market repurchase, both under Align's current $1.0 billion stock repurchase program.
We have $650.0 million remaining available for repurchase of our common stock under this stock repurchase program.
*Contract was open, as of Dec. 31, 2023.
Fiscal 2024 Business Outlook
Turning to our outlook, assuming no circumstances occur beyond our control, we provide the following framework for Q1 and fiscal 2024:
First quarter 2024 outlook:
Full year 2024 outlook:
Align Web Cast and Conference Call
We will host a conference call today, January 31, 2024, at 4:30 p.m. ET, 2:30 p.m. MT, to review our fourth quarter and full year 2023 results, discuss future operating trends, and our business outlook. The conference call will also be webcast live via the Internet. To access the webcast, go to the "Events & Presentations" section under Company Information on Align's Investor Relations website at http://investor.aligntech.com. To access the conference call, participants may register for the call by clicking here. Once registered, participants will receive an email with dial-in number and unique PIN number to access the live event. An archived audio webcast will be available 2 hours after the call's conclusion and will remain available for one month.
About Non-GAAP Financial Measures
To supplement our condensed consolidated financial statements, which are prepared and presented in accordance with generally accepted accounting principles in the United States ("GAAP"), we may provide investors with certain non-GAAP financial measures which may include constant currency net revenues, constant currency gross profit, constant currency gross margin, constant currency income from operations, constant currency operating margin, gross profit, gross margin, operating expenses, income from operations, operating margin, interest income and other income (expense), net, net income before provision for income taxes, provision for income taxes, effective tax rate, net income and/or diluted net income per share, which excludes certain items that may not be indicative of our fundamental operating performance including, foreign currency exchange rate impacts and discrete cash and non-cash charges or gains that are included in the most directly comparable GAAP measure. In Q4'22, we changed to a long-term non-GAAP effective tax rate in our computation of the non-GAAP income tax provision to provide better consistency across reporting periods. Our previous methodology for calculating our non-GAAP effective tax rate included certain non-recurring and period-specific items, that produced fluctuating effective tax rates that management does not believe are reflective of the Company's long-term effective tax rate. We have given effect to this new methodology effective January 1, 2022. Unless otherwise indicated, when we refer to non-GAAP financial measures they will exclude the effects of stock-based compensation, amortization of certain acquired intangibles, restructuring and other charges, acquisition-related costs, and associated tax impacts.
Our management believes that the use of certain non-GAAP financial measures provides meaningful supplemental information regarding our recurring core operating performance. We believe that both management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when planning, forecasting, and analyzing future periods. We believe these non-GAAP financial measures are useful to investors both because (1) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making and (2) they are used by our institutional investors and the analyst community to help them analyze the performance of our business.
There are limitations to using non-GAAP financial measures as they are not prepared in accordance with GAAP and may be different from non-GAAP financial measures used by other companies. The non-GAAP financial measures are limited in value because they exclude certain items that may have a material impact upon our reported financial results. In addition, they are subject to inherent limitations as they reflect the exercise of judgments by management about which charges are excluded from the non-GAAP financial measures. We compensate for these limitations by analyzing current and future results on a GAAP as well as a non-GAAP basis and also by providing GAAP measures in our public disclosures. The presentation of non-GAAP financial information is meant to be considered in addition to, not as a substitute for or in isolation from, the directly comparable financial measures prepared in accordance with GAAP. We urge investors to review the reconciliation of our GAAP financial measures to the comparable non-GAAP financial measures included herein and not to rely on any single financial measure to evaluate our business. For more information on these non-GAAP financial measures, please see the tables captioned "Unaudited GAAP to Non-GAAP Reconciliation."
About Align Technology, Inc.
Align Technology designs and manufactures the Invisalign® system, the most advanced clear aligner system in the world, iTero™ intraoral scanners and services, and exocad™ CAD/CAM software. These technology building blocks enable enhanced digital orthodontic and restorative workflows to improve patient outcomes and practice efficiencies for over 256 thousand doctor customers and are key to accessing Align's 600 million consumer market opportunity worldwide. Over the past 26 years, Align has helped doctors treat approximately 17 million patients with the Invisalign system and is driving the evolution in digital dentistry through the Align Digital Platform™, our integrated suite of unique, proprietary technologies and services delivered as a seamless, end-to-end solution for patients and consumers, orthodontists and GP dentists, and lab/partners. Visit www.aligntech.com for more information.
For additional information about the Invisalign system or to find an Invisalign doctor in your area, please visit www.invisalign.com. For additional information about the iTero digital scanning system, please visit www.itero.com. For additional information about exocad dental CAD/CAM offerings and a list of exocad reseller partners, please visit www.exocad.com.
Invisalign, iTero, exocad, Align, Align Digital Platform, iTero Element and iTero-exocad Connector are trademarks of Align Technology, Inc.
Forward-Looking Statements
This news release, including the tables below, contains forward-looking statements, including statements of beliefs and expectations regarding anticipated capital expenditures, clear aligner volumes, clear aligner ASPs, iTero scanner and services revenue, total revenues and operating margin, customer and consumer demand trends and market opportunities, our ability to successfully control our business and operations and pursue our strategic growth drivers, our expectations regarding the timing and impact of new products and technologies, our beliefs for the impacts of our stock repurchase programs and our ability to generate cash flow, and our beliefs regarding the trajectory of our business. Forward-looking statements contained in this news release relating to expectations about future events or results are based upon information available to Align as of the date hereof. Readers are cautioned that these forward-looking statements reflect our best judgments based on currently known facts and circumstances and are subject to risks, uncertainties, and assumptions that are difficult to predict. As a result, actual results may differ materially and adversely from those expressed in any forward-looking statement.
Factors that might cause such a difference include, but are not limited to:
The foregoing and other risks are detailed from time to time in our periodic reports filed with the Securities and Exchange Commission, including, but not limited to, our Annual Report on Form 10-K for the year ended December 31, 2022, which was filed with the Securities and Exchange Commission ("SEC") on February 27, 2023 and our latest Quarterly Report on Form 10-Q for the quarter ended September 30, 2023, which was filed with the SEC on November 3, 2023. Align undertakes no obligation to revise or update publicly any forward-looking statements for any reason.
ALIGN TECHNOLOGY, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data)
|
|
Three Months Ended December 31, |
|
Year Ended December 31, |
||||||||||||
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Net revenues |
|
$ |
956,726 |
|
|
$ |
901,515 |
|
|
$ |
3,862,260 |
|
|
$ |
3,734,635 |
|
Cost of net revenues |
|
|
287,202 |
|
|
|
283,814 |
|
|
|
1,155,397 |
|
|
|
1,100,860 |
|
Gross profit |
|
|
669,524 |
|
|
|
617,701 |
|
|
|
2,706,863 |
|
|
|
2,633,775 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
||||||||
Selling, general and administrative |
|
|
402,503 |
|
|
|
410,067 |
|
|
|
1,703,379 |
|
|
|
1,674,469 |
|
Research and development |
|
|
82,160 |
|
|
|
83,520 |
|
|
|
346,830 |
|
|
|
305,258 |
|
Restructuring and other charges |
|
|
13,316 |
|
|
|
11,453 |
|
|
|
13,316 |
|
|
|
11,453 |
|
Total operating expenses |
|
|
497,979 |
|
|
|
505,040 |
|
|
|
2,063,525 |
|
|
|
1,991,180 |
|
Income from operations |
|
|
171,545 |
|
|
|
112,661 |
|
|
|
643,338 |
|
|
|
642,595 |
|
Interest income and other income (expense), net: |
|
|
|
|
|
|
|
|
||||||||
Interest income |
|
|
4,978 |
|
|
|
2,760 |
|
|
|
17,258 |
|
|
|
5,367 |
|
Other income (expense), net |
|
|
(3,643 |
) |
|
|
(100 |
) |
|
|
(19,392 |
) |
|
|
(48,905 |
) |
Total interest income and other income (expense), net |
|
|
1,335 |
|
|
|
2,660 |
|
|
|
(2,134 |
) |
|
|
(43,538 |
) |
Net income before provision for income taxes |
|
|
172,880 |
|
|
|
115,321 |
|
|
|
641,204 |
|
|
|
599,057 |
|
Provision for income taxes |
|
|
48,866 |
|
|
|
73,546 |
|
|
|
196,151 |
|
|
|
237,484 |
|
Net income |
|
$ |
124,014 |
|
|
$ |
41,775 |
|
|
$ |
445,053 |
|
|
$ |
361,573 |
|
|
|
|
|
|
|
|
|
|
||||||||
Net income per share: |
|
|
|
|
|
|
|
|
||||||||
Basic |
|
$ |
1.64 |
|
|
$ |
0.54 |
|
|
$ |
5.82 |
|
|
$ |
4.62 |
|
Diluted |
|
$ |
1.64 |
|
|
$ |
0.54 |
|
|
$ |
5.81 |
|
|
$ |
4.61 |
|
Shares used in computing net income per share: |
|
|
|
|
|
|
|
|
||||||||
Basic |
|
|
75,703 |
|
|
|
77,541 |
|
|
|
76,426 |
|
|
|
78,190 |
|
Diluted |
|
|
75,802 |
|
|
|
77,683 |
|
|
|
76,568 |
|
|
|
78,420 |
|
ALIGN TECHNOLOGY, INC. UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands)
|
|
December 31, 2023 |
|
December 31, 2022 |
||
ASSETS |
|
|
|
|
||
|
|
|
|
|
||
Current assets: |
|
|
|
|
||
Cash and cash equivalents |
|
$ |
937,438 |
|
$ |
942,050 |
Marketable securities, short-term |
|
|
35,304 |
|
|
57,534 |
Accounts receivable, net |
|
|
903,424 |
|
|
859,685 |
Inventories |
|
|
296,902 |
|
|
338,752 |
Prepaid expenses and other current assets |
|
|
273,550 |
|
|
226,370 |
Total current assets |
|
|
2,446,618 |
|
|
2,424,391 |
|
|
|
|
|
||
Marketable securities, long-term |
|
|
8,022 |
|
|
41,978 |
Property, plant and equipment, net |
|
|
1,290,863 |
|
|
1,231,855 |
Operating lease right-of-use assets, net |
|
|
117,999 |
|
|
118,880 |
Goodwill |
|
|
419,530 |
|
|
407,551 |
Intangible assets, net |
|
|
82,118 |
|
|
95,720 |
Deferred tax assets |
|
|
1,590,045 |
|
|
1,571,746 |
Other assets |
|
|
128,682 |
|
|
55,826 |
|
|
|
|
|
||
Total assets |
|
$ |
6,083,877 |
|
$ |
5,947,947 |
|
|
|
|
|
||
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
||
|
|
|
|
|
||
Current liabilities: |
|
|
|
|
||
Accounts payable |
|
$ |
113,125 |
|
$ |
127,870 |
Accrued liabilities |
|
|
525,780 |
|
|
454,374 |
Deferred revenues |
|
|
1,427,706 |
|
|
1,343,643 |
Total current liabilities |
|
|
2,066,611 |
|
|
1,925,887 |
|
|
|
|
|
||
Income tax payable |
|
|
116,744 |
|
|
124,393 |
Operating lease liabilities |
|
|
96,968 |
|
|
100,334 |
Other long-term liabilities |
|
|
173,065 |
|
|
195,975 |
Total liabilities |
|
|
2,453,388 |
|
|
2,346,589 |
|
|
|
|
|
||
Total stockholders' equity |
|
|
3,630,489 |
|
|
3,601,358 |
|
|
|
|
|
||
Total liabilities and stockholders' equity |
|
$ |
6,083,877 |
|
$ |
5,947,947 |
ALIGN TECHNOLOGY, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands)
|
|
Year Ended December 31, |
||||||
|
|
|
2023 |
|
|
|
2022 |
|
CASH FLOWS FROM OPERATING ACTIVITIES |
|
|
|
|
||||
Net cash provided by operating activities |
|
$ |
785,776 |
|
|
$ |
568,732 |
|
|
|
|
|
|
||||
CASH FLOWS FROM INVESTING ACTIVITIES |
|
|
|
|
||||
Net cash used in investing activities |
|
|
(195,943 |
) |
|
|
(213,316 |
) |
|
|
|
|
|
||||
CASH FLOWS FROM FINANCING ACTIVITIES |
|
|
|
|
||||
Net cash used in financing activities |
|
|
(598,340 |
) |
|
|
(501,686 |
) |
|
|
|
|
|
||||
Effect of foreign exchange rate changes on cash, cash equivalents, and restricted cash |
|
|
4,671 |
|
|
|
(11,514 |
) |
Net (decrease) increase in cash, cash equivalents, and restricted cash |
|
|
(3,836 |
) |
|
|
(157,784 |
) |
Cash, cash equivalents, and restricted cash at beginning of the period |
|
|
942,355 |
|
|
|
1,100,139 |
|
Cash, cash equivalents, and restricted cash at end of the period |
|
$ |
938,519 |
|
|
$ |
942,355 |
|
ALIGN TECHNOLOGY, INC. INVISALIGN BUSINESS METRICS
|
|
Q1 |
|
Q2 |
|
Q3 |
|
Q4 |
|
Q1 |
|
Q2 |
|
Q3 |
|
Q4 |
||||||||
|
|
2022 |
|
2022 |
|
2022 |
|
2022 |
|
2023 |
|
2023 |
|
2023 |
|
2023 |
||||||||
Number of Invisalign Trained Doctors Cases Were Shipped To |
|
|
82,445 |
|
|
82,290 |
|
|
84,430 |
|
|
82,895 |
|
|
82,730 |
|
|
83,440 |
|
|
85,195 |
|
|
83,700 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Invisalign Trained Doctor Utilization Rates*: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
North America |
|
|
9.4 |
|
|
9.6 |
|
|
9.2 |
|
|
9.2 |
|
|
9.5 |
|
|
9.8 |
|
|
9.6 |
|
|
9.1 |
North American Orthodontists |
|
|
27.8 |
|
|
28.1 |
|
|
27.6 |
|
|
26.7 |
|
|
28.7 |
|
|
29.2 |
|
|
28.8 |
|
|
25.9 |
North American GP Dentists |
|
|
5.0 |
|
|
5.1 |
|
|
4.8 |
|
|
5.0 |
|
|
4.9 |
|
|
5.2 |
|
|
4.9 |
|
|
5.0 |
International |
|
|
6.4 |
|
|
6.4 |
|
|
6.0 |
|
|
6.5 |
|
|
6.2 |
|
|
6.6 |
|
|
6.1 |
|
|
6.5 |
Total Utilization Rates** |
|
|
7.3 |
|
|
7.4 |
|
|
7.0 |
|
|
7.2 |
|
|
7.1 |
|
|
7.5 |
|
|
7.1 |
|
|
7.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Clear Aligner Revenue Per Case Shipment***: |
|
$ |
1,335 |
|
$ |
1,315 |
|
$ |
1,245 |
|
$ |
1,225 |
|
$ |
1,335 |
|
$ |
1,335 |
|
$ |
1,320 |
|
$ |
1,320 |
* # of cases shipped / # of doctors to whom cases were shipped ** LATAM utilization rate is not separately disclosed but included in the total utilization rates *** Clear Aligner revenues / Case shipments as of Q4'23 Note: During the third quarter of 2023, we began including Touch Up cases revenues that were previously included in Non-Case revenues and have recast business metrics for the periods presented above accordingly.
ALIGN TECHNOLOGY, INC. STOCK-BASED COMPENSATION (in thousands)
|
|
Q1 |
|
Q2 |
|
Q3 |
|
Q4 |
|
Fiscal |
|
Q1 |
|
Q2 |
|
Q3 |
|
Q4 |
|
Fiscal |
||||||||||
|
|
2022 |
|
2022 |
|
2022 |
|
2022 |
|
2022 |
|
2023 |
|
2023 |
|
2023 |
|
2023 |
|
2023 |
||||||||||
Stock-based Compensation (SBC): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
SBC included in Gross Profit |
|
$ |
1,514 |
|
$ |
1,614 |
|
$ |
1,651 |
|
$ |
1,659 |
|
$ |
6,438 |
|
$ |
1,807 |
|
$ |
1,901 |
|
$ |
1,974 |
|
$ |
1,780 |
|
$ |
7,462 |
SBC included in Operating Expenses |
|
|
30,107 |
|
|
32,526 |
|
|
31,267 |
|
|
33,029 |
|
|
126,929 |
|
|
35,928 |
|
|
35,959 |
|
|
37,628 |
|
|
37,049 |
|
$ |
146,564 |
Total SBC |
|
$ |
31,621 |
|
$ |
34,140 |
|
$ |
32,918 |
|
$ |
34,688 |
|
$ |
133,367 |
|
$ |
37,735 |
|
$ |
37,860 |
|
$ |
39,602 |
|
$ |
38,829 |
|
$ |
154,026 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ALIGN TECHNOLOGY, INC. UNAUDITED GAAP TO NON-GAAP RECONCILIATION+ CONSTANT CURRENCY NET REVENUES (in thousands, except percentages)
Sequential constant currency analysis:
|
|
Three Months Ended |
|
|
|||||
|
|
December 31, 2023 |
|
September 30, 2023 |
|
Impact % of Revenue |
|||
GAAP net revenues |
|
$ |
956,726 |
|
$ |
960,214 |
|
|
|
Constant currency impact (1) |
|
|
12,782 |
|
|
|
1.3 |
% |
|
Constant currency net revenues (1) |
|
$ |
969,508 |
|
|
|
|
||
|
|
|
|
|
|
|
|||
GAAP Clear Aligner net revenues |
|
$ |
781,912 |
|
$ |
794,939 |
|
|
|
Clear Aligner constant currency impact (1) |
|
|
10,711 |
|
|
|
1.4 |
% |
|
Clear Aligner constant currency net revenues (1) |
|
$ |
792,623 |
|
|
|
|
||
|
|
|
|
|
|
|
|||
GAAP Imaging Systems and CAD/CAM Services net revenues |
|
$ |
174,814 |
|
$ |
165,275 |
|
|
|
Imaging Systems and CAD/CAM Services constant currency impact (1) |
|
|
2,071 |
|
|
|
1.2 |
% |
|
Imaging Systems and CAD/CAM Services constant currency net revenues (1) |
|
$ |
176,885 |
|
|
|
|
Year-over-year constant currency analysis:
|
|
Three Months Ended December 31, |
|
|
||||||
|
|
|
2023 |
|
|
|
2022 |
|
Impact % of Revenue |
|
GAAP net revenues |
|
$ |
956,726 |
|
|
$ |
901,515 |
|
|
|
Constant currency impact (1) |
|
|
(13,818 |
) |
|
|
|
(1.5 |
) % |
|
Constant currency net revenues (1) |
|
$ |
942,908 |
|
|
|
|
|
||
|
|
|
|
|
|
|
||||
GAAP Clear Aligner net revenues |
|
$ |
781,912 |
|
|
$ |
731,654 |
|
|
|
Clear Aligner constant currency impact (1) |
|
|
(11,957 |
) |
|
|
|
(1.6 |
) % |
|
Clear Aligner constant currency net revenues (1) |
|
$ |
769,955 |
|
|
|
|
|
||
|
|
|
|
|
|
|
||||
GAAP Imaging Systems and CAD/CAM Services net revenues |
|
$ |
174,814 |
|
|
$ |
169,861 |
|
|
|
Imaging Systems and CAD/CAM Services constant currency impact (1) |
|
|
(1,860 |
) |
|
|
|
(1.1 |
) % |
|
Imaging Systems and CAD/CAM Services constant currency net revenues (1) |
|
$ |
172,954 |
|
|
|
|
|
ALIGN TECHNOLOGY, INC. UNAUDITED GAAP TO NON-GAAP RECONCILIATION CONTINUED+ CONSTANT CURRENCY NET REVENUES CONTINUED (in thousands, except percentages)
Current year versus prior year constant currency analysis:
|
|
Year Ended December 31, |
|
|
|||||
|
|
|
2023 |
|
|
2022 |
|
Impact % of Revenue |
|
GAAP net revenues |
|
$ |
3,862,260 |
|
$ |
3,734,635 |
|
|
|
Constant currency impact (1) |
|
|
36,267 |
|
|
|
0.9 |
% |
|
Constant currency net revenues (1) |
|
$ |
3,898,527 |
|
|
|
|
||
|
|
|
|
|
|
|
|||
GAAP Clear Aligner net revenues |
|
$ |
3,199,329 |
|
$ |
3,072,585 |
|
|
|
Clear Aligner constant currency impact (1) |
|
|
29,683 |
|
|
|
0.9 |
% |
|
Clear Aligner constant currency net revenues (1) |
|
$ |
3,229,012 |
|
|
|
|
||
|
|
|
|
|
|
|
|||
GAAP Imaging Systems and CAD/CAM Services net revenues |
|
$ |
662,931 |
|
$ |
662,050 |
|
|
|
Imaging Systems and CAD/CAM Services constant currency impact (1) |
|
|
6,583 |
|
|
|
1.0 |
% |
|
Imaging Systems and CAD/CAM Services constant currency net revenues (1) |
|
$ |
669,514 |
|
|
|
|
Note: (1) We define constant currency net revenues as total net revenues excluding the effect of foreign exchange rate movements and use it to determine the percentage for the constant currency impact on net revenues on a sequential, year-over-year and current year versus prior year basis. Constant currency impact in dollars is calculated by translating the current period GAAP net revenues using the foreign currency exchange rates that were in effect during the previous comparable period and subtracting it by the current period GAAP net revenues. The percentage for the constant currency impact on net revenues is calculated by dividing the constant currency impact in dollars (numerator) by constant currency net revenues in dollars (denominator). (+) Changes and percentages are based on actual values. Certain tables may not sum or recalculate due to rounding. Refer to "About Non-GAAP Financial Measures" section of press release.
ALIGN TECHNOLOGY, INC. UNAUDITED GAAP TO NON-GAAP RECONCILIATION CONTINUED+ CONSTANT CURRENCY GROSS PROFIT AND GROSS MARGIN (in thousands, except percentages)
Sequential constant currency analysis:
|
|
Three Months Ended |
||||
|
|
December 31, 2023 |
|
September 30, 2023 |
||
GAAP gross profit |
|
$ |
669,524 |
|
$ |
663,076 |
Constant currency impact on net revenues |
|
|
12,782 |
|
|
|
Constant currency gross profit |
|
$ |
682,306 |
|
|
|
|
Three Months Ended |
||||
|
|
December 31, 2023 |
|
September 30, 2023 |
||
GAAP gross margin |
|
70.0 |
% |
|
69.1 |
% |
Gross margin constant currency impact (1) |
|
0.4 |
|
|
|
|
Constant currency gross margin (1) |
|
70.4 |
% |
|
|
Year-over-year constant currency analysis:
|
|
Three Months Ended December 31, |
|||||
|
|
|
2023 |
|
|
|
2022 |
GAAP gross profit |
|
$ |
669,524 |
|
|
$ |
617,701 |
Constant currency impact on net revenues |
|
|
(13,805 |
) |
|
|
|
Constant currency gross profit |
|
$ |
655,719 |
|
|
|
|
|
Three Months Ended December 30, |
||||
|
|
2023 |
|
|
2022 |
|
GAAP gross margin |
|
70.0 |
% |
|
68.5 |
% |
Gross margin constant currency impact (1) |
|
(0.4 |
) |
|
|
|
Constant currency gross margin (1) |
|
69.5 |
% |
|
|
ALIGN TECHNOLOGY, INC. UNAUDITED GAAP TO NON-GAAP RECONCILIATION CONTINUED+ CONSTANT CURRENCY GROSS PROFIT AND GROSS MARGIN (in thousands, except percentages)
Current year versus prior year constant currency analysis:
|
|
Year Ended December 31, |
||||
|
|
2023 |
|
2022 |
||
GAAP gross profit |
|
$ |
2,706,863 |
|
$ |
2,633,775 |
Constant currency impact on net revenues |
|
|
36,310 |
|
|
|
Constant currency gross profit |
|
$ |
2,743,174 |
|
|
|
|
Year Ended December 31, |
||||
|
|
2023 |
|
2022 |
||
GAAP gross margin |
|
70.1 |
% |
|
70.5 |
% |
Constant currency impact on net revenues(1) |
|
0.3 |
|
|
|
|
Constant currency gross margin(1) |
|
70.4 |
% |
|
|
Note:
(1) We define constant currency gross margin as constant currency gross profit as a percentage of constant currency net revenues. Gross margin constant currency impact is the increase or decrease in constant currency gross margin compared to the GAAP gross margin. (+) Changes and percentages are based on actual values. Certain tables may not sum or recalculate due to rounding. Refer to "About Non-GAAP Financial Measures" section of press release.
ALIGN TECHNOLOGY, INC. UNAUDITED GAAP TO NON-GAAP RECONCILIATION CONTINUED+ CONSTANT CURRENCY INCOME FROM OPERATIONS AND OPERATING MARGIN (in thousands, except percentages)
Sequential constant currency analysis:
|
|
Three Months Ended |
||||
|
|
December 31, 2023 |
|
September 30, 2023 |
||
GAAP income from operations |
|
$ |
171,545 |
|
$ |
166,346 |
Income from operations constant currency impact (1) |
|
|
8,226 |
|
|
|
Constant currency income from operations (1) |
|
$ |
179,771 |
|
|
|
|
Three Months Ended |
||||
|
|
December 31, 2023 |
|
September 30, 2023 |
||
GAAP operating margin |
|
17.9 |
% |
|
17.3 |
% |
Operating margin constant currency impact (2) |
|
0.6 |
|
|
|
|
Constant currency operating margin (2) |
|
18.5 |
% |
|
|
Year-over-year constant currency analysis:
|
|
Three Months Ended December 31, |
|||||
|
|
|
2023 |
|
|
|
2022 |
GAAP income from operations |
|
$ |
171,545 |
|
|
$ |
112,661 |
Income from operations constant currency impact (1) |
|
|
(8,305 |
) |
|
|
|
Constant currency income from operations (1) |
|
$ |
163,240 |
|
|
|
|
|
Three Months Ended December 31, |
||||
|
|
2023 |
|
|
2022 |
|
GAAP operating margin |
|
17.9 |
% |
|
12.5 |
% |
Operating margin constant currency impact (2) |
|
(0.6 |
) |
|
|
|
Constant currency operating margin (2) |
|
17.3 |
% |
|
|
ALIGN TECHNOLOGY, INC. UNAUDITED GAAP TO NON-GAAP RECONCILIATION CONTINUED+ CONSTANT CURRENCY INCOME FROM OPERATIONS AND OPERATING MARGIN CONTINUED (in thousands, except percentages)
Current year versus prior year constant currency analysis:
|
|
Year Ended December 31, |
||||
|
|
|
2023 |
|
|
2022 |
GAAP income from operations |
|
$ |
643,338 |
|
$ |
642,595 |
Income from operations constant currency impact (1) |
|
|
31,988 |
|
|
|
Constant currency income from operations (1) |
|
$ |
675,326 |
|
|
|
|
Year Ended December 31, |
||||
|
|
2023 |
|
|
2022 |
|
GAAP operating margin |
|
16.7 |
% |
|
17.2 |
% |
Operating margin constant currency impact (2) |
|
0.7 |
|
|
|
|
Constant currency operating margin (2) |
|
17.3 |
% |
|
|
Notes:
(1) We define constant currency income from operations as GAAP income from operations excluding the effect of foreign exchange rate movements for GAAP net revenues and operating expenses on a sequential, year-over-year and current year versus prior year basis. Constant currency impact in dollars is calculated by translating the current period GAAP net revenues and operating expenses using the foreign currency exchange rates that were in effect during the previous comparable period and subtracting it by the current period GAAP net revenues and operating expenses. (2) We define constant currency operating margin as constant currency income from operations as a percentage of constant currency net revenues. Operating margin constant currency impact is the increase or decrease in constant currency operating margin compared to the GAAP operating margin. (+) Changes and percentages are based on actual values. Certain tables may not sum or recalculate due to rounding. Refer to "About Non-GAAP Financial Measures" section of press release.
ALIGN TECHNOLOGY, INC. UNAUDITED GAAP TO NON-GAAP RECONCILIATION CONTINUED+ FINANCIAL MEASURES OTHER THAN CONSTANT CURRENCY (in thousands, except per share data)
|
|
Three Months Ended December 31, |
|
Year Ended December 31, |
||||||||||||
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
GAAP gross profit |
|
$ |
669,524 |
|
|
$ |
617,701 |
|
|
$ |
2,706,863 |
|
|
$ |
2,633,775 |
|
Stock-based compensation |
|
|
1,780 |
|
|
|
1,659 |
|
|
|
7,462 |
|
|
|
6,438 |
|
Amortization of intangibles (1) |
|
|
2,773 |
|
|
|
2,610 |
|
|
|
11,182 |
|
|
|
10,134 |
|
Restructuring charges (2) |
|
|
673 |
|
|
|
2,866 |
|
|
|
673 |
|
|
|
2,866 |
|
Non-GAAP gross profit |
|
$ |
674,750 |
|
|
$ |
624,836 |
|
|
$ |
2,726,180 |
|
|
$ |
2,653,213 |
|
|
|
|
|
|
|
|
|
|
||||||||
GAAP gross margin |
|
|
70.0 |
% |
|
|
68.5 |
% |
|
|
70.1 |
% |
|
|
70.5 |
% |
Non-GAAP gross margin |
|
|
70.5 |
% |
|
|
69.3 |
% |
|
|
70.6 |
% |
|
|
71.0 |
% |
|
|
|
|
|
|
|
|
|
||||||||
GAAP total operating expenses |
|
$ |
497,979 |
|
|
$ |
505,040 |
|
|
$ |
2,063,525 |
|
|
$ |
1,991,180 |
|
Stock-based compensation |
|
|
(37,049 |
) |
|
|
(33,029 |
) |
|
|
(146,564 |
) |
|
|
(126,929 |
) |
Amortization of intangibles (1) |
|
|
(866 |
) |
|
|
(810 |
) |
|
|
(3,497 |
) |
|
|
(3,417 |
) |
Restructuring and other charges (2) |
|
|
(13,316 |
) |
|
|
(11,453 |
) |
|
|
(13,316 |
) |
|
|
(11,453 |
) |
Non-GAAP total operating expenses |
|
$ |
446,748 |
|
|
$ |
459,748 |
|
|
$ |
1,900,148 |
|
|
$ |
1,849,381 |
|
|
|
|
|
|
|
|
|
|
||||||||
GAAP income from operations |
|
$ |
171,545 |
|
|
$ |
112,661 |
|
|
$ |
643,338 |
|
|
$ |
642,595 |
|
Stock-based compensation |
|
|
38,829 |
|
|
|
34,688 |
|
|
|
154,026 |
|
|
|
133,367 |
|
Amortization of intangibles (1) |
|
|
3,639 |
|
|
|
3,420 |
|
|
|
14,679 |
|
|
|
13,551 |
|
Restructuring and other charges (2) |
|
|
13,989 |
|
|
|
14,319 |
|
|
|
13,989 |
|
|
|
14,319 |
|
Non-GAAP income from operations |
|
$ |
228,002 |
|
|
$ |
165,088 |
|
|
$ |
826,032 |
|
|
$ |
803,832 |
|
|
|
|
|
|
|
|
|
|
||||||||
GAAP operating margin |
|
|
17.9 |
% |
|
|
12.5 |
% |
|
|
16.7 |
% |
|
|
17.2 |
% |
Non-GAAP operating margin |
|
|
23.8 |
% |
|
|
18.3 |
% |
|
|
21.4 |
% |
|
|
21.5 |
% |
|
|
|
|
|
|
|
|
|
||||||||
GAAP net income before provision for income taxes |
|
$ |
172,880 |
|
|
$ |
115,321 |
|
|
$ |
641,204 |
|
|
$ |
599,057 |
|
Stock-based compensation |
|
|
38,829 |
|
|
|
34,688 |
|
|
|
154,026 |
|
|
|
133,367 |
|
Amortization of intangibles (1) |
|
|
3,639 |
|
|
|
3,420 |
|
|
|
14,679 |
|
|
|
13,551 |
|
Restructuring and other charges (2) |
|
|
13,989 |
|
|
|
14,319 |
|
|
|
13,989 |
|
|
|
14,319 |
|
Non-GAAP net income before provision for income taxes |
|
$ |
229,337 |
|
|
$ |
167,748 |
|
|
$ |
823,898 |
|
|
$ |
760,294 |
|
ALIGN TECHNOLOGY, INC. UNAUDITED GAAP TO NON-GAAP RECONCILIATION CONTINUED FINANCIAL MEASURES OTHER THAN CONSTANT CURRENCY CONTINUED (in thousands, except per share data)
|
|
Three Months Ended December 31, |
|
Year Ended December 31, |
||||||||||||
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
GAAP provision for income taxes |
|
$ |
48,866 |
|
|
$ |
73,546 |
|
|
$ |
196,151 |
|
|
$ |
237,484 |
|
Tax impact on non-GAAP adjustments (3) |
|
|
(2,998 |
) |
|
|
(39,997 |
) |
|
|
(31,415 |
) |
|
|
(85,426 |
) |
Non-GAAP provision for income taxes (3) |
|
$ |
45,868 |
|
|
$ |
33,549 |
|
|
$ |
164,736 |
|
|
$ |
152,058 |
|
|
|
|
|
|
|
|
|
|
||||||||
GAAP effective tax rate |
|
|
28.3 |
% |
|
|
63.8 |
% |
|
|
30.6 |
% |
|
|
39.6 |
% |
Non-GAAP effective tax rate (3) |
|
|
20.0 |
% |
|
|
20.0 |
% |
|
|
20.0 |
% |
|
|
20.0 |
% |
|
|
|
|
|
|
|
|
|
||||||||
GAAP net income |
|
$ |
124,014 |
|
|
$ |
41,775 |
|
|
$ |
445,053 |
|
|
$ |
361,573 |
|
Stock-based compensation |
|
|
38,829 |
|
|
|
34,688 |
|
|
|
154,026 |
|
|
|
133,367 |
|
Amortization of intangibles (1) |
|
|
3,639 |
|
|
|
3,420 |
|
|
|
14,679 |
|
|
|
13,551 |
|
Restructuring and other charges (2) |
|
|
13,989 |
|
|
|
14,319 |
|
|
|
13,989 |
|
|
|
14,319 |
|
Tax impact on non-GAAP adjustments (3) |
|
|
2,998 |
|
|
|
39,997 |
|
|
|
31,415 |
|
|
|
85,426 |
|
Non-GAAP net income (3) |
|
$ |
183,469 |
|
|
$ |
134,199 |
|
|
$ |
659,162 |
|
|
$ |
608,236 |
|
|
|
|
|
|
|
|
|
|
||||||||
GAAP diluted net income per share |
|
$ |
1.64 |
|
|
$ |
0.54 |
|
|
$ |
5.81 |
|
|
$ |
4.61 |
|
Non-GAAP diluted net income per share (3) |
|
$ |
2.42 |
|
|
$ |
1.73 |
|
|
$ |
8.61 |
|
|
$ |
7.76 |
|
|
|
|
|
|
|
|
|
|
||||||||
Shares used in computing diluted net income per share |
|
|
75,802 |
|
|
|
77,683 |
|
|
|
76,568 |
|
|
|
78,420 |
|
Notes: (1) Amortization of intangible assets related to certain acquisitions (2) During the fourth quarters of 2022 and 2023, we initiated restructuring plans to increase efficiencies across the organization and lower the overall cost structure. Restructuring charges recorded to Cost of net revenues and operating expenses primarily related to post-employment benefits, lease termination charges and asset impairments in 2022 and post-employment benefits in 2023. (3) In Q4'22, we changed our methodology for the computation of the non-GAAP effective tax rate to a long-term projected tax rate and have given effect to the new methodology from January 1, 2022. (+) Changes and percentages are based on actual values. Certain tables may not sum or recalculate due to rounding. Refer to "About Non-GAAP Financial Measures" section of press release.
ALIGN TECHNOLOGY, INC. Q1 2024 OUTLOOK - GAAP TO NON-GAAP RECONCILIATION
GAAP Operating Margin |
|
slightly above 14.2% |
Stock-based compensation |
|
~4.0% |
Amortization of intangibles (1) |
|
~0.4% |
Non-GAAP Operating Margin |
|
slightly above 18.5% |
ALIGN TECHNOLOGY, INC. FISCAL 2024 OUTLOOK - GAAP TO NON-GAAP RECONCILIATION
GAAP Operating Margin |
|
slightly above 16.7% |
Stock-based compensation |
|
~4.4% |
Amortization of intangibles (1) |
|
~0.4% |
Non-GAAP Operating Margin |
|
slightly above 21.4% |
(1) Amortization of intangible assets related to certain acquisitions
Refer to "About Non-GAAP Financial Measures" section of press release.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240131111055/en/