Core Insights - Aquablation therapy shows comparable symptom relief to laser enucleation while significantly preserving ejaculatory function and continence in patients with large prostates [1][2][4] Group 1: Study Overview - The WATER III trial is an international, prospective, multicenter study comparing Aquablation therapy to laser enucleation for prostate sizes between 80-180 mL, involving 186 men treated from December 2020 to September 2024 [2] - The study reported three-month primary safety and efficacy endpoints, with plans to follow patients for five years [2] Group 2: Clinical Outcomes - Aquablation therapy resulted in a 14.8% rate of ejaculatory dysfunction compared to 77.1% for laser enucleation, and a 0% rate of stress incontinence compared to 9.1% for laser enucleation [2] - The procedural transfusion rate for Aquablation therapy was 0%, indicating a strong safety profile in managing bleeding risk [3] Group 3: Expert Commentary - The CEO of PROCEPT BioRobotics emphasized that the results of the WATER III trial reinforce the company's commitment to establishing Aquablation therapy as the standard of care for BPH, highlighting its effectiveness in preserving quality of life factors [4] - Dr. Naeem Bhojani noted that the consistent efficacy and lower rates of complications represent a significant advancement for patients seeking BPH treatment [4] Group 4: Technology and Innovation - Aquablation therapy is the first and only ultrasound-guided, robotic-assisted, heat-free waterjet treatment for BPH, allowing for personalized treatment planning based on real-time imaging [5] - The technology enables precise and controlled removal of prostate tissue while preserving critical anatomical structures [5] Group 5: Company Background - PROCEPT BioRobotics is focused on advancing patient care through innovative urology solutions, manufacturing the AQUABEAM and HYDROS Robotic Systems [6] - The company has developed a substantial body of clinical evidence, including over 150 peer-reviewed publications, supporting the benefits of Aquablation therapy [7]

Core Insights - PROCEPT BioRobotics Corporation will host an in-person investor event on April 25, 2025, at the Venetian Hotel in Las Vegas during the American Urological Association Annual Meeting [1] - The company will report its financial results for Q1 2025 on April 24, 2025, before market open, followed by a conference call at 8:00 a.m. Eastern Time [2][3] Company Overview - PROCEPT BioRobotics focuses on advancing patient care through surgical robotics, specifically in urology, with products like the AQUABEAM and HYDROS™ Robotic Systems [4] - The HYDROS Robotic System is noted as the only AI-powered robotic technology delivering Aquablation therapy, which is designed for effective treatment of lower urinary tract symptoms (LUTS) due to benign prostatic hyperplasia (BPH) [4] - BPH affects approximately 40 million men in the United States, highlighting a significant market opportunity for the company's solutions [4] - The company has established a robust clinical foundation with over 150 peer-reviewed publications supporting the efficacy of Aquablation therapy [4]

Group 1 - The mission of Grassroots Trading is to provide objective, unbiased, and balanced research, focusing on small- to mid-cap companies while also identifying opportunities in large- and mega-cap companies [1] - The research is backed by solid data and is free from emotional influences or preferences for specific companies [1] - Grassroots Trading aims to offer compelling points of view on often overlooked investment opportunities for Seeking Alpha investors [1] Group 2 - The article does not provide any specific investment recommendations or advice regarding the suitability of investments for particular investors [2][3] - There is a disclosure stating that the author has no stock, option, or similar derivative positions in any mentioned companies and no plans to initiate such positions within the next 72 hours [2] - The views expressed may not reflect those of Seeking Alpha as a whole, and the analysts are third-party authors who may not be licensed or certified [3]

Market Opportunity - The total addressable market opportunity for the company's products in the United States is estimated to exceed $20 billion, driven by approximately 8.2 million patients[23]. - The global incidence of BPH among men over 50 years old presents a significant incremental market opportunity outside of the United States[23]. - The total addressable market opportunity for BPH in the United States is estimated to exceed $20 billion, with approximately 8.2 million patients in the addressable population[35]. - Approximately 290,000 of the 400,000 annual BPH surgeries in the U.S. are resective procedures performed across about 2,700 hospitals[32]. - The aging demographics in the U.S. are expected to drive future growth, with the number of men over 65 projected to double by 2060[35]. Clinical Evidence and Efficacy - The company has developed a significant body of clinical evidence, including nine clinical studies and over 150 peer-reviewed publications, supporting the efficacy and safety of Aquablation therapy[27]. - In the U.S. pivotal trial, Aquablation therapy demonstrated surgical retreatment rates of only 5.2% and 3.0% at five years in the WATER and WATER II studies, respectively[26]. - Aquablation therapy has shown low rates of irreversible complications, maintaining a significantly higher level of sexual function compared to TURP[29]. - Aquablation therapy demonstrated a transfusion rate of only 0.8% in a study of 2,089 men, significantly lower than the 25% rate associated with traditional procedures[51]. - Clinical studies reported incontinence rates between 0%-2% and ejaculatory dysfunction rates between 6.9%-24.6% for Aquablation therapy[51]. - The WATER study, pivotal for FDA approval, showed superiority in safety and non-inferiority in efficacy compared to TURP, with results published in 2018[65]. - The WATER II study focused on patients with prostate sizes between 80 ml and 150 ml, demonstrating significant efficacy and safety outcomes[65]. - The OPEN WATER study included a diverse patient population with prostate sizes from 20 ml to 150 ml, providing robust data for Aquablation therapy[65]. Regulatory Environment - The company is subject to extensive government regulation and oversight, which could impact its ability to maintain necessary marketing authorizations for its robotic systems[19]. - The company is subject to extensive regulation by the FDA and other authorities, impacting the development and commercialization of its medical devices[99]. - The company's currently marketed robotic systems are classified as Class II devices, initially authorized through a de novo classification[106]. - The FDA requires a 510(k) premarket notification for most Class II devices, demonstrating substantial equivalence to a legally marketed predicate device[110]. - The PMA process for Class III devices is more demanding, requiring extensive data from preclinical studies and human clinical trials[112]. - The FDA has 180 days to complete its review of a PMA application, although the actual review often takes significantly longer[112]. - The European Union's Medical Device Regulation (MDR) requires all medical devices to be certified under the MDR, impacting the marketing of devices previously certified under older directives[128]. - Compliance with the General Safety and Performance Requirements (GSPRs) is mandatory for all medical devices marketed in the EU, which includes undergoing a conformity assessment procedure[130]. Financial Performance - Revenue for the year ended December 31, 2024, was $224.5 million, compared to $136.2 million for 2023, representing a year-over-year increase of 64.7%[31]. - The net loss for the year ended December 31, 2024, was $91.4 million, an improvement from a net loss of $105.9 million in 2023[31]. - For the years ended December 31, 2024 and 2023, the company reported net losses of $91.4 million and $105.9 million, respectively, with an accumulated deficit of $546.0 million as of December 31, 2024[164]. - As of December 31, 2024, the company had $333.7 million in cash and cash equivalents, which is expected to be sufficient to meet capital requirements for at least the next 12 months[174]. Business Strategy and Growth - The company aims to expand its market presence by educating urologists about the clinical benefits of Aquablation therapy and enhancing training programs[30]. - The company plans to expand its install base of robotic systems by increasing its direct sales team and establishing relationships with key surgeons and decision-makers[32]. - The company aims to increase awareness of Aquablation therapy among primary care physicians, targeting approximately 3.9 million men under their care[36]. - The company is committed to broadening private payor coverage and improving patient access to Aquablation therapy in key international markets[32]. - The company plans to expand its direct sales organization to enhance adoption and utilization of Aquablation therapy among urologists[64]. - Marketing initiatives will target primary care physicians to increase awareness and referrals for BPH patients to urologists[65]. - The company plans to significantly expand its commercial infrastructure to increase customer base and awareness, which requires substantial time and resources[185]. Competition and Market Challenges - The company faces intense competition from both resective surgical treatments and non-surgical treatments for BPH, with competitors having greater resources and established market presence[83]. - The company faces competition from larger companies and alternative treatments, which may impact its market penetration and operating results[195]. - The company faces significant hurdles in product adoption due to established treatment patterns, requiring education and supportive clinical data[197]. - The company may face pricing pressure from group purchasing organizations and integrated delivery networks seeking discounts on its robotic systems[187]. - The company must continuously innovate and deliver new product enhancements to maintain its competitive edge in the market[196]. Operational Risks - The company currently operates a sole manufacturing facility in San Jose, California, which poses risks to growth if damaged or affected by unforeseen events[199]. - Manufacturing capabilities are limited by the company's experience and reliance on single-source suppliers, which could lead to supply shortages and impact production capacity[202]. - The company has not qualified alternative suppliers for critical components, which could result in manufacturing delays and increased expenses if current suppliers fail to meet demand[203]. - Warranty claims and service requirements could significantly increase operating expenses, adversely affecting financial results and market reputation[206]. - The company must accurately forecast customer demand to manage inventory effectively; failure to do so could lead to excess inventory or inability to meet customer needs[210]. - The company is vulnerable to cyberattacks and security breaches, which could disrupt operations and result in significant liabilities and reputational damage[212]. Employee and Governance - The company aims to foster a diverse workplace and has a growing employee base of 756 as of December 31, 2024, which is crucial for its success[151]. - The company has published its Environmental, Social, and Governance (ESG) Report annually since 2022, detailing its human capital programs and initiatives[153]. - The company emphasizes employee engagement and retention through comprehensive compensation and benefits programs, including annual bonuses and flexible work arrangements[157]. Funding and Capital Requirements - The company may need additional funding to finance planned operations, and changing circumstances could lead to a faster consumption of capital than currently anticipated[174]. - The company anticipates requiring additional capital in the future to expand its sales and marketing organization, invest in clinical trials, and support research and development efforts[175]. - Future funding requirements will depend on various factors, including market acceptance of products, investment scope in the sales force, and costs associated with clinical trials and regulatory approvals[176]. - The company may seek to raise additional capital through equity offerings or debt financings, which could result in dilution to existing stockholders[177].

Financial Data and Key Metrics Changes - Total revenue for Q4 2024 was $68.2 million, representing a growth of 57% compared to Q4 2023 [7] - Full year total revenue was $224.5 million, indicating a growth of 65% [8] - Gross margin for Q4 2024 reached 64%, marking an all-time high [36] - Net loss for Q4 2024 was $18.9 million, an improvement from $27.5 million in the same period of the prior year [40] - Adjusted EBITDA loss was $10.3 million compared to a loss of $23.3 million in Q4 2023 [40] Business Line Data and Key Metrics Changes - The company sold 60 new robotic systems in Q4 2024, with over 95% being HYDROS systems at an average selling price of approximately $460,000 [20][33] - US handpiece and consumable revenue for Q4 2024 was $29.3 million, representing a growth of 36% compared to Q4 2023 [34] - International revenue in Q4 2024 was $7.8 million, showing a growth of 137% compared to the prior year period [35] Market Data and Key Metrics Changes - The US installed base of robotic systems grew to 505, a 60% increase year-over-year [8] - Approximately 50% of all BPH resective surgeries are Medicare, with the other half being private pay [23] Company Strategy and Development Direction - The company aims to transform the global treatment of BPH and become the standard of care, currently holding about 10% US BPH resective market share [9] - The introduction of the HYDROS Robotic System and FirstAssist AI is expected to enhance procedural accuracy and outcomes [11][12] - The company is pursuing a pivotal randomized clinical study for prostate cancer, which could position Aquablation therapy as a first-line surgical treatment [15][16] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the recovery in procedure volumes following a saline supply shortage that impacted Q4 2024 [28][30] - The company anticipates full year 2025 total revenue to be approximately $320 million, representing growth of about 43% compared to 2024 [41] - Management highlighted the importance of strategic investments to drive long-term growth, particularly in clinical trials [48] Other Important Information - The company experienced a saline supply shortage due to Hurricane Helene, which resulted in a delay or cancellation of 10% to 20% of expected procedures in Q4 [26][28] - The company has a strong cash position with $337 million in cash, cash equivalents, and restricted cash as of December 31 [40] Q&A Session Summary Question: Impact of saline shortage on procedures - Management estimated that the saline shortage resulted in a delay or cancellation of up to 2,000 procedures in Q4, based on customer surveys and internal analysis [67][70] - Accounts not impacted by the saline shortage performed as expected, showing strong sequential growth [76] Question: Q1 utilization growth - Q1 guidance does not fully assume that all lost procedures from Q4 will return, but there is optimism for recovery in February and March [80][81] Question: HYDROS feedback and account mix - Customers are excited about the HYDROS features, with 95% of procedures utilizing the FirstAssist AI [102] - There is a growing demand from medium and low-volume BPH hospitals for Aquablation systems [106] Question: Replacement revenue and ASP - Replacement ASPs for AquaBeam customers are expected to be lower, around $50,000 to $100,000, while future replacements will align more closely with greenfield sales [128][129] - The $3 million in anticipated replacement revenue is separate from the guidance for new systems [135]

PROCEPT BioRobotics February 2025 © 2025 PROCEPT BioRobotics Corporation. All Rights Reserved. Safe Harbor Statement This presentation and accompanying oral presentation contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including the expected financial results of PROCEPT BioRobotics Corporation (the "Company"). Words such as "anticipates," "believes," "expects," "intends," "projects," "anticipates," and "future" or similar expressions are intend ...

Group 1: Financial Performance - PROCEPT BioRobotics reported a quarterly loss of $0.35 per share, which aligns with the Zacks Consensus Estimate, an improvement from a loss of $0.54 per share a year ago [1] - The company posted revenues of $68.24 million for the quarter ended December 2024, exceeding the Zacks Consensus Estimate by 2.40%, compared to $43.58 million in the same quarter last year [2] - Over the last four quarters, PROCEPT BioRobotics has surpassed consensus EPS estimates three times and topped consensus revenue estimates four times [2][3] Group 2: Stock Performance and Outlook - PROCEPT BioRobotics shares have declined approximately 19.1% since the beginning of the year, contrasting with the S&P 500's gain of 1.7% [3] - The current consensus EPS estimate for the upcoming quarter is -$0.32 on revenues of $66.34 million, and for the current fiscal year, it is -$1.27 on revenues of $315.64 million [7] - The estimate revisions trend for PROCEPT BioRobotics is mixed, resulting in a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [6] Group 3: Industry Context - The Medical - Instruments industry, to which PROCEPT BioRobotics belongs, is currently ranked in the top 32% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Revenue Performance - Total revenue for Q4 2024 was $68.2 million, a 57% increase compared to the prior year period[4] - Full year 2024 total revenue reached $224.5 million, a 65% increase from $136.2 million in 2023[11] - Total revenue for the twelve months ended December 31, 2024, was $224.498 million, a 65% increase compared to $136.191 million in 2023[33] - U.S. total revenue for the three months ended December 31, 2024, was $60.389 million, up 50% from $40.269 million in the same period of 2023[33] - U.S. handpiece and consumables revenue for Q4 2024 was $29.3 million, a 36% increase compared to the prior year[10] - Handpieces and other consumables revenue in the U.S. for the twelve months ended December 31, 2024, reached $110.542 million, a significant increase of 73% from $64.051 million in 2023[33] Profitability and Loss - Net loss for Q4 2024 was $18.9 million, an improvement from a loss of $27.5 million in the prior year[7] - PROCEPT BioRobotics Corporation reported a net loss of $80 million for 2025, with an adjusted EBITDA of $(35) million[29] Operating Expenses - Operating expenses for Q4 2024 were $63.4 million, compared to $50.8 million in the prior year, marking a significant increase[6] Gross Margin - Gross margin for Q4 2024 improved to 64%, up from 49% in the prior year period[5] Assets and Liabilities - Total assets increased to $534.017 million in 2024, up from $404.717 million in 2023, representing a growth of approximately 32%[31] - Current assets rose to $481.842 million in 2024, compared to $350.567 million in 2023, marking a 37% increase[31] - Total liabilities increased slightly to $131.797 million in 2024 from $123.965 million in 2023[31] - The company's accumulated deficit increased to $(545.985) million in 2024 from $(454.572) million in 2023[31] - Cash and cash equivalents grew to $333.725 million in 2024, up from $257.222 million in 2023, indicating a 30% increase[31] Future Projections - The company projects total revenue for 2025 to be approximately $320 million, representing a 42% growth over 2024[10] - The company anticipates a depreciation and amortization expense of $6.8 million for 2025[29] Technological Advancements - The company received FDA 510(k) clearance for the HYDROS™ Robotic System in August 2024, marking a significant technological advancement[3] Install Base - The install base of AquaBeam and Hydros Robotic Systems in the U.S. was 505 systems as of December 31, 2024[4]

Core Insights - PROCEPT BioRobotics Corporation reported a total revenue of $68.2 million for Q4 2024, marking a 57% increase year-over-year, driven by higher system and handpiece sales, increased average selling prices, and international revenue growth [4][9] - The company received FDA 510(k) clearance for its HYDROS™ Robotic System and FDA-IDE approval for a pivotal clinical study for prostate cancer, indicating significant advancements in its product offerings and clinical research [3] - For the full year 2024, total revenue reached $224.5 million, a 65% increase from 2023, with a projected revenue of approximately $320 million for 2025, representing a 42% growth [10][9] Financial Performance - Q4 2024 gross margin improved to 64% from 49% in the prior year, attributed to better overhead absorption and increased revenues [5] - Operating expenses for Q4 2024 were $63.4 million, up from $50.8 million in the previous year, primarily due to expansion of the commercial organization and increased compensation expenses [6] - The net loss for Q4 2024 was $18.9 million, an improvement from a loss of $27.5 million in the same period last year, with adjusted EBITDA loss narrowing to $10.3 million from $23.3 million [7][12] Revenue Breakdown - U.S. system revenue for Q4 2024 was $27.6 million, a 67% increase year-over-year, with 60 new robotic systems sold at an average price of approximately $460,000 [4][9] - U.S. handpiece and consumable revenue for the quarter was $29.3 million, reflecting a 36% increase compared to the prior year [4] - International revenue for Q4 2024 was $7.8 million, a significant increase of approximately 137% compared to the previous year [4] Guidance and Projections - The company projects Q1 2025 total revenue to be approximately $65.5 million, with U.S. system revenue expected to be around $18.7 million [16] - For the full year 2025, the company anticipates a gross margin of approximately 64.5% and total operating expenses of about $300 million [16] - The projected adjusted EBITDA loss for 2025 is approximately $35 million [16]

Financial Results Announcement - PROCEPT BioRobotics will report financial results for the fourth quarter of 2024 after market close on February 25, 2025 [1] - A conference call will be hosted by the Company's management at 4:30 p.m. Eastern Time on the same day [1] Conference Presentations - Management will present at the TD Cowen 45th Annual Healthcare Conference on March 4 at 1:10 p.m. Eastern Time [3] - Additionally, management will present at the 2025 Leerink Partners Healthcare Conference on March 11 at 3:00 p.m. Eastern Time [3] Company Overview - PROCEPT BioRobotics focuses on advancing patient care through surgical robotics, specifically in urology [5] - The Company manufactures the AQUABEAM and HYDROS™ Robotic Systems, with the HYDROS system being the only AI-powered technology delivering Aquablation therapy [5] - Aquablation therapy is designed for effective treatment of lower urinary tract symptoms (LUTS) due to benign prostatic hyperplasia (BPH), affecting approximately 40 million men in the U.S. [5] - The Company has over 150 peer-reviewed publications supporting the clinical advantages of Aquablation therapy [5]