STAAR Surgical Company (STAA) Status update summary

Market performance and trends

• Q1 China revenue reached $47.4 million, driven by in-market sales and excitement around EVO+ launch.

• Inventory levels in China are closely monitored, currently at or below six months, supporting healthy channel dynamics.

• Q1 benefited from a pull forward of procedures, likely flattening the usual Q1-Q2 ramp; Q2 is expected to be similar to Q1.

• U.S. sales grew 22% year-over-year in Q1, surpassing $6 million for the first time, driven by new surgeon adoption, higher utilization, and targeted marketing.

• EVO ICL is gaining share as LASIK procedures decline, with double-digit growth in ICLs against a backdrop of LASIK declines.

Strategic initiatives and guidance

• No formal 2026 revenue guidance is provided due to uncertainty; predictability in quarterly trends is needed before issuing guidance.

• Key swing factors for the year include China demand, EVO+ adoption, and macro/geopolitical risks, especially in the Middle East and India.

• Gross margin target is 75% by year-end, with levers including increased Swiss manufacturing, improved overhead absorption, and higher ASPs from EVO+.

• Operating expenses are targeted at $225 million for 2026, with ongoing investments in technology, ERP, and innovation, while non-ROI spend has been reduced.

• Long-term, the company aims for double-digit operating margins, with incremental investments focused on innovation and clinical trials.

Product innovation and market expansion

• EVO+ launch in China is exceeding expectations, with demand outpacing initial supply and plans to scale production.

• FDA expanded EVO's labeled age to 21-60, adding about eight million to the U.S. addressable market.

• Ongoing global strategy to expand labeling and access, including recent approvals in Brazil and Taiwan.

• Innovation focus includes presbyopia solutions, extended depth of focus, multifocality, and manufacturing/process improvements.

• Infrastructure investments, such as ERP and manufacturing, are designed to support long-term growth and operational resilience.