Nevro (NVRO) Q2 2024 earnings summary

Executive summary

• Q2 2024 worldwide revenue was $104.2 million, down 4.3% year-over-year, with U.S. revenue at $90.7 million (down 2.4%) and international revenue at $13.5 million (down 15%).

• Net loss from operations was $25.1 million, improved from $25.6 million last year; net loss narrowed to $19.6 million, and adjusted EBITDA turned positive at $3.0 million versus a $3.1 million loss in Q2 2023.

• Gross margin fell to 64.8% (or 70.5% excluding a $6 million one-time supplier contract charge).

• Strategic review initiated to explore options including partnerships, mergers, or a sale, aiming to accelerate growth and diversify the portfolio.

• Recent acquisition of Vyrsa Technologies expanded presence in the SI joint fusion market.

Financial highlights

• Operating expenses were $92.6 million, down from $100.1 million, including $4.6 million in restructuring and $1.7 million in acquisition-related amortization.

• Cash and investments at quarter-end totaled $273.7 million, down $7.8 million sequentially.

• Interest expense rose to $6.7 million in Q2 2024 due to the Braidwell Term Loan.

• Excluding one-time items, net loss from operations was $16.9 million, a 34% improvement year-over-year.

• Six-month revenue was $206.1 million (up 0.5% year-over-year).

Outlook and guidance

• Full-year 2024 revenue guidance revised to $400–$405 million, down from $435–$445 million, reflecting a 5–6% decrease from 2023.

• Full-year gross margin expected at 66% (or 68% excluding the supplier charge); long-term target remains mid-70s%.

• Operating expenses for 2024 expected at $383 million, including $10.1 million in restructuring and $9.4 million in acquisition-related charges.

• Adjusted EBITDA guidance for 2024 revised to -$20 million to -$18 million.

• Q3 2024 revenue expected at $92–$94 million; Q3 adjusted EBITDA at -$10 million to -$9 million.