STAAR Surgical Company (STAA) Stifel 2026 Healthcare Conference 2026 summary

China demand and mix

• China in-market ICL shipments rose 12.5% YTD, versus 6% growth in 2025 and a 14.5% decline in 2023; channel inventory is now at low, serviceable levels.

• China’s refractive market was described as broadly flat, while higher-priced procedures gained mix; rising V5 and Toric adoption is supporting share gains and average selling prices.

• V5 mix exceeded the 30% level reached at Q2 exit and grew further in Q3; adoption is expected to continue, with a premium maintained as mix expands.

• Q4 China revenue is expected to grow YoY, with positive unit growth also expected; V5 and Toric mix should support pricing, and improved supply is expected to meet demand.

• Q3 demand included growth in public hospitals and lower-diopter patients, which management linked to clinics promoting higher-priced V5 procedures.

Manufacturing and profitability

• Switzerland now manufactures all lenses destined for China; future shipments from Swiss production avoid tariffs, while remaining U.S.-made inventory carries tariffs that should decline in Q4 and benefit margins in 2027.

• Swiss production ramp-up and low early volumes drove high unit costs and weak overhead absorption in H1; the Q2 ERP transition also required a multiweek shutdown.

• Swiss output capacity is planned to reach 300,000–400,000 units by year-end 2026; production mix changes constrained the ramp, but V5 supply is expected to improve in Q4 and V4c output is also being built.

• Lower unit costs and reduced China tariffs are expected to significantly improve gross margins; a 20% adjusted EBITDA margin is a long-term target.

Competition and China policy

• Management views new phakic IOL launches, including Zeiss’s acrylic LUNANA, as potential category builders; near-term lens giveaways may divert procedures, while market expansion is expected to help longer term.

• Management cited Collamer material and Toric manufacturing capability as competitive advantages; it said competitors lacked Toric products, which address more than half of the market.

• Volume-based procurement risk was viewed as limited because ICLs are cash-pay, ~75% of procedures are in the private sector, and competing products are not yet like-for-like; management said risk is not impossible.

• Direct selling in China is a board-level consideration with potential margin benefits; the ERP system supports the option, but no shift is underway or committed.