Company Announcements

InMode Reports Third Quarter 2024 Financial Results; Quarterly GAAP Revenue of $130.2 Million (which consists of $98.3 million of net sales in Q3 and $31.9 million of pre-orders from the first half of 2024)

YOKNEAM, Israel, Oct. 30, 2024 /PRNewswire/ --InMode Ltd.(Nasdaq: INMD) ("InMode"), a leading global provider of innovative medical technologies, today announced its consolidated financial results for the third quarter ended September 30, 2024.

InMode Logo

Third Quarter 2024 Highlights:

  • Quarterly GAAP revenue of $130.2 million (which consists of $98.3 million of net sales in Q3 and $31.9 million of pre-orders from the first half of 2024).
  • Quarterly revenues from consumables and service of $15.8 million, a decrease of 11% compared to the third quarter of 2023.
  • GAAP operation income of $48.2 million, *non-GAAP operation income of $52.2 million.
  • Total cash position of $684.9 million as of September 30, 2024, including cash and cash equivalents, marketable securities, and short-term bank deposits.
  • Full-year 2024 revenue guidance has been revised to be between $410 million and $420 million, compared to prior guidance of $430 million to $440 million.

 

U.S. GAAP Results

(U.S. dollars in thousands, except for per share data)


Q3 2024

Q3 2023

Q1-Q3 2024

Q1-Q3 2023

Revenues

$130,232

$123,112

296,965

365,267

Gross Margins

82 %

84 %

81 %

83 %

Net Income

$50,990

$46,520

98,504

142,754

Earnings per Diluted Share

$0.65

$0.54

1.19

1.66

*Non-GAAP Results

(U.S. dollars in thousands, except for per share data)


Q3 2024

Q3 2023

Q1-Q3 2024

Q1-Q3 2023

Gross Margins

82 %

84 %

81 %

84 %

Net Income

$54,971

$53,084

111,626

160,032

Earnings per Diluted Share

$0.70

$0.61

1.34

1.86

 

*Please refer to "Use of non-GAAP Financial Measures" below for important information about non-GAAP financial measures. A reconciliation between U.S. GAAP and non-GAAP Statement of Income  is provided following the financial statements that are included in this release. Non-GAAP results exclude share-based compensation adjustments.

Management Comments

"The third quarter presented ongoing challenges for InMode," said Moshe Mizrahy, Chief Executive Officer. "Macroeconomic conditions led to a decrease in demand for our consumables and new platform sales, while the launch of our latest platforms required extended adjustments to our production lines. Nevertheless, we believe our recent management changes will better align our operations with our strategic plan. We also take pride in our dedicated employees, whose hard work has allowed us to make faster-than-expected progress in fulfilling pre-orders."

Third Quarter 2024 Financial Results

Total GAAP revenues for the third quarter of 2024 reached $130.2 million (including $31.9 million in revenue from first half of 2024 pre-orders), an increase of 5.8% compared to $123.1 million in the third quarter of 2023.

"Despite continued headwinds in the third quarter, we are pleased to have fulfilled our pre-orders ahead of schedule, allowing us to focus on execution once market demand recovers," said Yair Malca, Chief Financial Officer.

GAAP and *non-GAAP gross margin for the third quarter of 2024 was 82% compared to a gross margin of 84% for the third quarter of 2023.

GAAP operating margin for the third quarter of 2024 was 37%, compared to an operating margin of 38% in the third quarter of 2023. *Non-GAAP operating margin for the third quarter of 2024 was 40% compared to 43% for the third quarter of 2023. This decrease was primarily attributable to higher sales and marketing expenses, primarily driven by our recent management changes costs, higher commissions, as well as additional investments in trade shows and workshop activities.

InMode reported GAAP net income of $51.0 million, or $0.65 per diluted share, in the third quarter of 2024, compared to $46.5 million, or $0.54 per diluted share, in the third quarter of 2023. On a *non-GAAP basis, InMode reported net income of $55.0 million, or $0.70 per diluted share, in the third quarter of 2024, compared to $53.1 million, or $0.61 per diluted share, in the third quarter of 2023.

2024 Financial Outlook

Management provided an outlook for the full year of 2024 ending December 31, 2024. Based on our current estimates, management expects:

  • Full Year 2024 revenue to be between $410 to $420 million compared to prior guidance of $430 million to $440 million
  • *Non-GAAP gross margin between 81% and 82% compared to prior guidance of 82% - 84%
  • *Non-GAAP income from operations to be between $140 million and $145 million compared to prior guidance of $150 million to $155 million
  • *Non-GAAP earnings per diluted share remains the same as in previous guidance at $1.92 to $1.96 after taking into consideration the estimated shares that will be repurchased as part of the share repurchase programs announced this year

This outlook is not a guarantee of future performance, and stockholders should not rely on such forward-looking statements. See "Forward-Looking Statements" for additional information.

*Please refer to "Use of non-GAAP Financial Measures" below for important information about non-GAAP financial measures. A reconciliation between U.S. GAAP and non-GAAP Statement of Income is provided following the financial statements that are included in this release. Non-GAAP results exclude share-based compensation adjustments.

The Current Situation in Israel

Regarding the current situation in Israel, management would like to assure investors that the Company is prioritizing the safety and well-being of its employees, and all its team are safe. However, an inability to promptly receive needed supplies and materials due to the ongoing and unpredictable nature of the conflict in Israel and the surrounding region may adversely impact our ability to commercialize and manufacture our product candidates and products in a timely manner. This could cause several delays and/or issues for our operations, which in turn would have a material adverse impact on our ability to commercialize our product candidates and our financial condition.

Use of Non-GAAP Financial Measures

In addition to InMode's operating results presented in accordance with GAAP, this release contains certain non-GAAP financial measures including non-GAAP net income, non-GAAP earnings per diluted share, non-GAAP operating margin. Because these measures are used in InMode's internal analysis of financial and operating performance, management believes they provide investors with greater transparency of its view of InMode's economic performance. Management also believes the presentation of these measures, when analyzed in conjunction with InMode's GAAP operating results, allows investors to more effectively evaluate and compare InMode's performance to that of its peers, although InMode's presentation of its non-GAAP measures may not be strictly comparable to the similarly titled measures of other companies. Schedules reconciling each of these non-GAAP financial measures are provided as a supplement to this release.

Conference Call Information

Mr. Moshe Mizrahy, Chief Executive Officer, Dr. Michael Kreindel, Co-Founder and Chief Technology Officer and Mr. Yair Malca, Chief Financial Officer, will host a conference call today, October 30, 2024, at 8:30 a.m. Eastern Time to discuss the third quarter 2024 financial results.

The Company encourages participants to pre-register for the conference call using the following link

https://dpregister.com/sreg/10193479/fdae439271.

Callers will receive a unique dial-in number upon registration, which enables immediate access to the call. Participants may pre-register at any time, including up to and after the call start time.

For callers who opt out of pre-registration, please dial one of the following teleconferencing numbers. Please begin by placing your call 10 minutes before the conference call commences. If you are unable to connect using the toll-free number, please try the international dial-in number.

U.S. Toll-Free Dial-in Number: 1-833-316-0562
Israel Toll- Free Dial-in Number: 1-80-921-2373
International Dial-in Number: 1-412-317-5736

Webcast URL: https://event.choruscall.com/mediaframe/webcast.html?webcastid=X3HVujVC

At:

8:30 a.m. Eastern Time
5:30 a.m. Pacific Time

The conference call will also be webcast live from a link on InMode's website at https://inmodemd.com/investors/events-presentations/. A replay of the conference call will be available from October 30, 2024, at 12 p.m. Eastern Time to November 13, 2024, at 11:59 p.m. Eastern Time. To access the replay, please dial one of the following numbers: 

Replay Dial-in U.S. TOLL-FREE: 1-877-344-7529
Replay Dial-in Canada TOLL-FREE: 855-669-9658
Replay Dial-in TOLL/INTERNATIONAL: 1-412-317-0088
Replay Pin Number: 5305602

To access the replay using an international dial-in number, please select the link below:

https://services.choruscall.com/ccforms/replay.html

A replay of the conference call will also be available for 90 days on InMode's website at https://inmodemd.com/investors/.

About InMode

InMode is a leading global provider of innovative medical technologies. InMode develops, manufactures, and markets devices harnessing novel radio frequency ("RF") technology. InMode strives to enable new emerging surgical procedures as well as improve existing treatments. InMode has leveraged its medically accepted minimally invasive RF technologies to offer a comprehensive line of products across several categories for plastic surgery, gynecology, dermatology, otolaryngology, and ophthalmology. For more information about InMode, please visit www.inmodemd.com.

Forward-Looking Statements 

The information in this press release includes forward-looking statements within the meaning of the federal securities laws. These statements generally relate to future events or InMode's future financial or operating performance, including the 2024 revenue projection described above. Actual outcomes and results may differ materially from what is expressed or forecast in such forward-looking statements. In some cases, you can identify these statements because they contain words such as "anticipate," "believe," "estimate," "expect," "intend," "may," "plan," "predict," "project," "will," "would" and similar expressions that concern our expectations, strategic plans or intentions. Forward-looking statements are based on management's current expectations and assumptions, and are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Consequently, actual results could differ materially from those indicated in these forward-looking statements. When considering these forward-looking statements, you should keep in mind the risk factors and other cautionary statements included in InMode's Annual Report on Form 20-F filed with the Securities and Exchange Commission on February 13, 2024, and our future public filings. InMode undertakes no obligation and does not intend to update these forward-looking statements to reflect events or circumstances occurring after this press release. You are cautioned not to place undue reliance on these forward-looking statements, which pertain only as of the date of this press release.

Company Contact:

Yair Malca

Chief Financial Officer

Phone: (949) 305-0108

Email: Yair.Malca@inmodemd.com

Investor Relations Contact:

Miri Segal

MS-IR LLC

Email: ir@inmodemd.com

 

 

INMODE LTD.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(U.S. dollars in thousands, except for per share data)

(Unaudited)


Three months ended
September 30,

Nine months ended
September 30,


2024

2023

2024

2023


REVENUES

130,232

123,112

296,965

365,267


COST OF REVENUES

24,055

20,136

57,536

60,444


GROSS PROFIT

106,177

102,976

239,429

304,823


OPERATING EXPENSES:






Research and development

3,254

3,268

10,470

9,937


Sales and marketing

51,863

50,819

136,713

143,591


General and administrative

2,799

2,479

7,579

6,879


TOTAL OPERATING EXPENSES

57,916

56,566

154,762

160,407


OPERATIONS INCOME

48,261

46,410

84,667

144,416


Finance income, net

9,918

4,953

26,592

12,687


INCOME BEFORE INCOME TAXES

58,179

51,363

111,259

157,103


INCOME TAXES

7,189

4,843

12,755

14,349


NET INCOME

50,990

46,520

98,504

142,754








EARNINGS PER SHARE:






Basic

0.66

0.56

1.20

1.71


Diluted

0.65

0.54

1.19

1.66


WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING USED IN COMPUTATION OF
EARNINGS PER SHARE (in thousands)






Basic

77,022

83,703

81,795

83,423


Diluted

77,908

85,970

83,016

85,814


 

 

INMODE LTD.

CONDENSED CONSOLIDATED BALANCE SHEETS

(U.S. dollars in thousands, except for per share data)

(Unaudited)





September 30,

2024

December 31,

2023

Assets



CURRENT ASSETS:



Cash and cash equivalents

164,838

144,411

Marketable securities

281,458

373,647

Short-term bank deposits

238,592

223,547

Accounts receivable, net of allowance for credit losses

40,777

42,362

Prepaid expense and other receivables

24,447

16,268

Inventories

58,284

45,095

         TOTAL CURRENT ASSETS

808,396

845,330

    NON-CURRENT ASSETS:



Accounts receivable, net of allowance for credit losses

2,917

3,670

Deferred income tax asset

1,048

1,506

Operating lease right-of-use assets

8,636

9,698

Property and equipment, net

2,336

2,382

Other investments

700

700

TOTAL NON-CURRENT ASSETS

15,637

17,956

TOTAL ASSETS

824,033

863,286

Liabilities and shareholders' equity



CURRENT LIABILITIES:



Accounts payable

14,313

13,966

Contract liabilities

17,230

10,923

Other liabilities

44,155

39,247

TOTAL CURRENT LIABILITIES

75,698

64,136

    NON-CURRENT LIABILITIES:



Contract liabilities

3,318

3,766

Other liabilities

2,808

1,399

Operating lease liabilities

5,317

6,613

TOTAL NON-CURRENT LIABILITIES

11,443

11,778

TOTAL LIABILITIES

87,141

75,914




TOTAL SHAREHOLDERS' EQUITY

736,892

787,372

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY

824,033

863,286

 

 

INMODE LTD.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(U.S. dollars in thousands, except for per share data)

(Unaudited)



Three months ended
September 30,

Nine months ended
September 30,


2024

2023

2024

2023


CASH FLOWS FROM OPERATING ACTIVITIES:






Net income

50,990

46,520

98,504

142,754


Adjustments required to reconcile net income to net cash provided by operating activities:






Depreciation and amortization

138

129

480

501


Share-based compensation expenses

3,981

6,564

13,122

17,278


Change in allowance for credit losses of trade receivable

130

426

414

665


Loss on marketable securities, net

29

-

170

-


Finance expenses (income), net

3,863

(527)

(5,934)

(3,236)


Deferred income taxes

35

(216)

(58)

(154)


Changes in operating assets and liabilities:






Decrease (increase) in accounts receivable

(2,570)

(10,753)

1,924

(16,461)


Increase in other receivables

(860)

(1,347)

(7,577)

(5,367)


Increase in inventories

(5,657)

(1,421)

(13,189)

(92)


Increase (decrease) in accounts payable

(1,235)

(962)

347

(3,909)


Increase (decrease) in other liabilities

11,722

3,040

6,160

(12,792)


Increase (decrease) in contract liabilities (current and non-current)

(26,517)

(9)

5,859

(3,630)


Net cash provided by operating activities

34,049

41,444

100,222

115,557


CASH FLOWS FROM INVESTING ACTIVITIES:






   Investment in short-term deposits

(78,390)

(138,140)

(164,687)

(166,140)


   Proceeds from short-term deposits

138,140

50,590

151,640

85,090


   Purchase of fixed assets

(77)

(149)

(435)

(684)


   Purchase of marketable securities

(90,820)

(60,588)

(276,513)

(192,707)


   Proceeds from sale of marketable securities

22,233

-

69,608

-


   Proceeds from maturity of marketable securities

122,969

78,465

304,777

190,070


Net cash provided by (used in) investing activities

114,055

(69,822)

84,390

(84,371)


CASH FLOWS FROM FINANCING ACTIVITIES:






  Repurchase of ordinary shares

(76,556)

-

(165,536)

-


       Exercise of options

565

2,729

1,194

5,229


Net cash provided by (used in) financing activities

(75,991)

2,729

(164,342)

5,229


EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS

728

(473)

157

(222)


NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

72,841

(26,122)

20,427

36,193








CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD

91,997

159,855

144,411

97,540


CASH AND CASH EQUIVALENTS AT END OF PERIOD

164,838

133,733

164,838

133,733


 

Revision of prior period financial information

The Company revised certain items within the investing activities with no impact on the net cash used in investing activities. The items impacted were "Investment in short-term deposits" and "Proceeds from short-term deposits" which were decreased by $41,000 and $119,000 for the three months and nine months ended September 30,2023 respectively and "Purchase of marketable securities" and "Proceeds from maturity of marketable securities" which were decreased by $0, and $40,423 for the three months and nine months ended September 30, 2023.

These changes have no impact on our previously reported consolidated total cash flows from operating activities, financing activities and investing activities in the periods stated above as well as net income and net change in cash and cash equivalents.

The Company evaluated the materiality of the adjustments, individually and in the aggregate, considering both qualitative and quantitative factors, and concluded that it was immaterial to the Company's prior periods' consolidated financial information. Since the revision was not material to any prior interim period or annual consolidated financial statements, no amendments to previously filed interim or annual periodic financial information was required. Consequently, the Company has revised the historical consolidated financial information presented herein for the impact of the above.

 

INMODE LTD.

CONDENSED CONSOLIDATED FINANCIAL HIGHLIGHTS

(U.S. dollars in thousands, except for per share data)

(Unaudited)

 

 


Three months ended September 30,

Nine months ended September 30,

2024

2023

2024

2023

Revenues by Category:


















Capital Equipment revenues - United States

85,734

66 %

67,969

55 %

151,392

51 %

191,548

53 %

Capital Equipment revenues - International

28,662

22 %

37,276

30 %

86,191

29 %

114,284

31 %

Total Capital Equipment revenues

114,396

88 %

105,245

85 %

237,583

80 %

305,832

84 %

Consumables and service revenues

15,836

12 %

17,867

15 %

59,382

20 %

59,435

16 %

Total Revenue

130,232

100 %

123,112

100 %

296,965

100 %

365,267

100 %













 

 


Three months ended September 30,

Nine months ended September 30,

2024

2023

2024

2023


%

%

%

%


United States

International

Total

United States

International

Total

United States

International

Total

United States

International

Total

Revenues by Technology:













Minimal-Invasive

95

77

90

85

80

83

90

82

88

87

76

83

Hands-Free

4

3

4

11

4

9

7

3

5

10

5

8

Non-Invasive

1

20

6

4

16

8

3

15

7

3

19

9


100

100

100

100

100

100

100

100

100

100

100

100

 

 

INMODE LTD.

RECONCILIATION OF GAAP CONDENSED CONSOLIDATED STATEMENTS OF

 INCOME TO NON-GAAP CONDENSED CONSOLIDATED STATEMENTS OF INCOME 

(U.S. dollars in thousands, except for per share data)

(Unaudited)





 

Three months ended September 30, 2024

 

Three months ended September 30, 2023


 

 

 

GAAP

 

 

Share Based
Compensation

 

 

 

Non-GAAP

 

 

 

GAAP

 

 

Share Based
Compensation

 

 

 

Non-GAAP


REVENUES

130,232

-

130,232

123,112

-

123,112


COST OF REVENUES

24,055

(481)

23,574

20,136

(572)

19,564


GROSS PROFIT

106,177

481

106,658

102,976

572

103,548


OPERATING EXPENSES:








Research and development

3,254

(890)

2,364

3,268

(729)

2,539


Sales and marketing

51,863

(2,300)

49,563

50,819

(4,787)

46,032


General and administrative

2,799

(310)

2,489

2,479

(476)

2,003


TOTAL OPERATING
EXPENSES

 

57,916

 

(3,500)

 

54,416

 

56,566

 

(5,992)

50,574


OPERATIONS INCOME

48,261

3,981

52,242

46,410

6,564

52,974


Finance income, net

 

9,918

 

-

 

9,918

 

4,953

 

-

4,953


INCOME BEFORE INCOME TAXES

58,179

3,981

62,160

51,363

6,564

57,927


INCOME TAXES

7,189

-

7,189

4,843

-

4,843


NET INCOME

50,990

3,981

54,971

46,520

6,564

53,084










EARNINGS PER SHARE:








Basic

 

0.66


 

0.71

 

0.56


0.63


Diluted

0.65


0.70

0.54


0.61


WEIGHTED AVERAGE NUMBER OF
SHARES OUTSTANDING USED IN
COMPUTATION OF EARNINGS PER
SHARE (in thousands)








Basic

77,022


77,022

83,703


83,703


Diluted

77,908


78,548

85,970


86,333


 

 


Nine months ended September 30, 2024

Nine months ended September 30, 2023

GAAP

Share Based
Compensation

Non-GAAP

GAAP

Share Based
Compensation

Non-GAAP

REVENUES

296,965

-

296,965

365,267

-

365,267

COST OF REVENUES

57,536

(1,361)

56,175

60,444

(1,473)

58,971

GROSS PROFIT

239,429

1,361

240,790

304,823

1,473

306,296

OPERATING EXPENSES:







Research and development

10,470

(1,877)

8,593

9,937

(1,987)

7,950

Sales and marketing

136,713

(9,007)

127,706

143,591

(12,556)

131,035

General and administrative

7,579

(877)

6,702

6,879

(1,262)

5,617

TOTAL OPERATING
EXPENSES

154,762

(11,761)

143,001

160,407

(15,805)

 

144,602

OPERATIONS INCOME

84,667

13,122

97,789

144,416

17,278

 

161,694

Finance income, net

26,592

-

26,592

12,687

-

12,687

INCOME BEFORE INCOME TAXES

111,259

13,122

124,381

157,103

17,278

174,381

INCOME TAXES

12,755

-

12,755

14,349

-

14,349

NET INCOME

98,504

13,122

111,626

142,754

17,278

160,032








EARNINGS PER
SHARE:







Basic

1.20


1.36

1.71


1.92

Diluted

1.19


1.34

1.66


1.86

WEIGHTED AVERAGE NUMBER OF
SHARES OUTSTANDING USED IN
COMPUTATION OF EARNINGS PER
SHARE (in thousands)







Basic

81,795


81,795

83,423


83,423

Diluted

83,016


83,536

85,814


86,154

 

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SOURCE InMode Ltd.