Align Technology Announces Second Quarter 2022 Financial Results
Align Technology (NASDAQ: ALGN) reported Q2'22 revenues of $969.6 million, down 0.4% sequentially and 4.1% year-over-year. Clear Aligner sales decreased to $798.4 million, while Imaging Systems revenues rose 4.7% sequentially. The operating income was $188.2 million with a margin of 19.4%. Net income was $112.8 million, translating to $1.44 per diluted share. The company faced significant foreign exchange impacts, totaling approximately $15.3 million sequentially. Align purchased 757,000 shares at an average price of $264.37, demonstrating shareholder return strategy amidst economic challenges.
- Imaging Systems and CAD/CAM Services revenues rose 4.7% sequentially.
- Operational margin maintained at approximately 20% despite economic headwinds.
- Continued investment in strategic initiatives such as new offices and manufacturing facilities.
- Total revenues down 0.4% sequentially and 4.1% year-over-year.
- Clear Aligner revenues down 1.4% sequentially and 5.1% year-over-year.
- Net income decreased by 43.5% year-over-year.
Company operating well through unprecedented global economic headwinds and continued impacts of COVID-19 variants in certain markets
-
Q2'22 total revenues of
were down slightly sequentially and year over year$969.6 million -
Q2’22 revenues were unfavorably impacted by foreign exchange of approximately
sequentially and approximately$15.3 million year over year (1)$39.9 million -
Q2'22 operating income of
and operating margin of$188.2 million 19.4% , which was unfavorably impacted by foreign exchange of approximately 1.1 points sequentially and approximately 2.4 points year over year (1) -
Q2'22 diluted net income per share of
; Q2'22 non-GAAP diluted net income per share of$1.44 $2.00 -
Q2'22 Clear Aligner revenues of
and Clear Aligner volume of 599.0 thousand cases$798.4 million -
Q2'22 Imaging Systems and CAD/CAM Services revenues of
, up$171.2 million 4.7% sequentially and up0.8% year over year -
Purchased approximately 757 thousand shares of Align common stock at an average price of
per share for a total purchase price of$264.37 $200.0 million
Commenting on Align's second quarter results,
Financial Summary
|
Q2'22 |
|
Q1'22 |
|
Q2'21 |
|
Q/Q Change |
|
Y/Y Change |
||
Invisalign Case Shipments |
598,990 |
|
598,835 |
|
665,575 |
|
0.0 |
% |
|
(10.0 |
)% |
GAAP |
|
|
|
|
|
|
|
|
|
||
Net Revenues |
|
|
|
|
|
|
(0.4 |
)% |
|
(4.1 |
)% |
Clear Aligner |
|
|
|
|
|
|
(1.4 |
)% |
|
(5.1 |
)% |
Imaging Systems and CAD/CAM Services |
|
|
|
|
|
|
+4.7 |
% |
|
+0.8 |
% |
Net Income |
|
|
|
|
|
|
(16.0 |
)% |
|
(43.5 |
)% |
Diluted EPS |
|
|
|
|
|
|
( |
) |
|
( |
) |
Non-GAAP |
|
|
|
|
|
|
|
|
|
||
Net Income |
|
|
|
|
|
|
(7.0 |
)% |
|
(35.2 |
)% |
Diluted EPS |
|
|
|
|
|
|
( |
) |
|
( |
) |
As of
As of
Commenting on Align's Q2'22 results, Align Technology CFO and EVP Global Finance,
Q2'22 Announcement Highlights
-
On
May 19, 2022 , we introduced Invisalign Outcome Simulator Pro, the next generation of our advanced patient communication tool, enabling doctors to show patients their potential new smile after Invisalign treatment, using in-face visualization and/or 3D dentition view, all done chairside in minutes. Invisalign Outcome Simulator Pro is currently in limited market release and will be available on all iTero Element™ Plus Series scanners and imaging systems starting in the second half of 2022. -
On
May 20, 2022 , we announced a strategic partnership with Asana to offer Asana Smiles™ for Align®, to Invisalign trained doctors in theU.S. , a new work management solution providing a customizable workflow solution that helps orthodontic and dental practices keep track of tasks connected to the lifecycle of a patient's Invisalign treatment journey. Booking consultations, submitting prescriptions, monitoring ClinCheck® software treatment plans, and preparing for aligner delivery appointments can be easily organized, tracked, and communicated across a practice with Asana Smiles for Align. This solution can be implemented directly or as an additive solution for practices with other software currently in place. -
On
June 22, 2022 , we announced a donation to JA ($250.0 thousand Junior Achievement ) Worldwide through theAlign Foundation , Align’s donor-advised charitable fund throughFidelity Charitable . This donation commemorates Align’s 25th anniversary milestone as a company that has transformed smiles and changed lives for millions of people around the world through Align’s pioneering technology innovations and doctor-driven business model. -
On
June 6, 2022 , we announced the award of eleven research grants totaling to universities under Align's twelfth Annual Research Award Program. The funded research studies cover a wide range of topics for projects seeking to better understand treatment in orthodontics and dentistry including distalization, stability in retention, pre-surgical treatment of cleft palate, maintenance of space in mixed dentition with aligners, consideration of periodontal conditions in treatment, and the demand for education regarding treatment with aligners.$275.0 thousand
Align Web Cast and Conference Call
We will host a conference call today,
About Non-GAAP Financial Measures
To supplement our condensed consolidated financial statements, which are prepared and presented in accordance with generally accepted accounting principles in
We use non-GAAP financial measures for financial and operational decision-making and as a means to evaluate period-to-period comparisons. Our management believes that the use of certain non-GAAP financial measures provide meaningful supplemental information regarding our recurring core operating performance. We believe that both management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when planning, forecasting, and analyzing future periods. These non-GAAP financial measures also facilitate management's internal evaluation of period-to-period comparisons. We believe these non-GAAP financial measures are useful to investors both because (1) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making and (2) they are used by our institutional investors and the analyst community to help them analyze the performance of our business.
There are limitations to using non-GAAP financial measures, though, because they are not prepared in accordance with GAAP and may be different from non-GAAP financial measures used by other companies. The non-GAAP financial measures are limited in value because they exclude certain items that may have a material impact upon our reported financial results. In addition, they are subject to inherent limitations as they reflect the exercise of judgments by management about which charges are excluded from the non-GAAP financial measures. We compensate for these limitations by analyzing current and future results on a GAAP as well as a non-GAAP basis and also by providing GAAP measures in our public disclosures. The presentation of non-GAAP financial information is meant to be considered in addition to, not as a substitute for or in isolation from, the directly comparable financial measures prepared in accordance with GAAP. We urge investors to review the reconciliation of our GAAP financial measures to the comparable non-GAAP financial measures included herein and not to rely on any single financial measure to evaluate our business. For more information on these non-GAAP financial measures, please see the tables captioned "Unaudited GAAP to Non-GAAP Reconciliation."
About
For additional information about the Invisalign system or to find an Invisalign doctor in your area, please visit www.invisalign.com. For additional information about the iTero digital scanning system, please visit www.itero.com. For additional information about exocad dental CAD/CAM offerings and a list of exocad reseller partners, please visit www.exocad.com.
Forward-Looking Statements
This news release, including the tables below, contains forward-looking statements, including statements of beliefs and expectations regarding market opportunities, factors, events and circumstances impacting macro-economic conditions and predictability, the impact of new products and innovations, our positioning and ability to lead the digital revolution of orthodontic treatment, the benefits of our operating model and balance sheet, our ability to manage investments and our areas of focus and commitment. Forward-looking statements contained in this news release relating to expectations about future events or results are based upon information available to Align as of the date hereof. Readers are cautioned that these forward-looking statements reflect our best judgments based on currently known facts and circumstances and are subject to risks, uncertainties, and assumptions that are difficult to predict. As a result, actual results may differ materially and adversely from those expressed in any forward-looking statement.
Factors that might cause such a difference include, but are not limited to:
- macroeconomic conditions, including inflation, fluctuations in currency exchange rates, weakness in general economic conditions and recessions;
-
customer and consumer purchasing behavior and changes in consumer spending habits as a result of, among other things, prevailing economic conditions, levels of employment, salaries and wages, inflationary pressure, declining consumer confidence, the military conflict in
Ukraine , fluctuations in currency exchange rates, and the impact of efforts by central banks to combat inflation and recession; - the impact of the COVID-19 pandemic and its variants on the health and safety of our employees, customers, patients, and our suppliers, as well as the physical and economic impacts of the various recommendations, orders, and protocols issued by local and national governmental agencies in light of continual evolution of the pandemic, including any periodic reimplementation of preventative measures in various global locations;
-
the economic and geopolitical ramifications of the military conflict in
Ukraine , including sanctions, retaliatory sanctions, nationalism, supply chain disruptions and other consequences, any of which may or continue to adversely impact our commercial and research and development activities inside and outside ofRussia ; - the timing and availability and cost of raw materials, components, products and other shipping and supply chain constraints;
- unexpected or rapid changes in the growth or decline of our domestic and/or international markets;
- competition from existing and new competitors;
- rapidly evolving and groundbreaking advances that fundamentally alter the dental industry or the way new and existing customers market and provide products and services to consumers;
- the ability to protect our intellectual property rights;
- continued compliance with regulatory requirements;
- declines in, or the slowing of the growth of, sales of our intraoral scanners domestically and/or internationally and the impact either would have on the adoption of Invisalign products;
- the willingness and ability of our customers to maintain and/or increase product utilization in sufficient numbers;
- the possibility that the development and release of new products or enhancements to existing products do not proceed in accordance with the anticipated timeline or may themselves contain bugs, errors or defects in software or hardware requiring remediation and that the market for the sale of these new or enhanced products may not develop as expected;
-
a tougher consumer demand environment in
China generally, especially for manufacturers and service providers whose headquarters or primary operations are not based inChina ; - the risks relating to our ability to sustain or increase profitability or revenue growth in future periods (or minimize declines) while controlling expenses;
- expansion of our business and products;
- the impact of excess or constrained capacity at our manufacturing and treat operations facilities and pressure on our internal systems and personnel;
- the compromise of our systems or networks, including any customer and/or patient data contained therein, for any reason;
- the timing of case submissions from our doctors within a quarter as well as an increased manufacturing costs per case;
- foreign operational, political, military and other risks relating to our operations; and
- the loss of key personnel, labor shortages or work stoppages for us or our suppliers.
The foregoing and other risks are detailed from time to time in our periodic reports filed with the
|
|||||||||||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||||||||||
(in thousands, except per share data) |
|||||||||||||||
|
|
Three Months Ended
|
|
Six Months Ended
|
|||||||||||
|
|
2022 |
|
2021 |
|
2022 |
|
2021 |
|||||||
Net revenues |
|
$ |
969,553 |
|
|
$ |
1,010,808 |
|
|
$ |
1,942,772 |
|
|
$ |
1,905,579 |
Cost of net revenues |
|
|
281,994 |
|
|
|
252,270 |
|
|
|
545,867 |
|
|
|
469,943 |
Gross profit |
|
|
687,559 |
|
|
|
758,538 |
|
|
|
1,396,905 |
|
|
|
1,435,636 |
Operating expenses: |
|
|
|
|
|
|
|
|
|||||||
Selling, general and administrative |
|
|
426,398 |
|
|
|
431,921 |
|
|
|
865,855 |
|
|
|
829,036 |
Research and development |
|
|
72,965 |
|
|
|
57,715 |
|
|
|
144,772 |
|
|
|
112,252 |
Total operating expenses |
|
|
499,363 |
|
|
|
489,636 |
|
|
|
1,010,627 |
|
|
|
941,288 |
Income from operations |
|
|
188,196 |
|
|
|
268,902 |
|
|
|
386,278 |
|
|
|
494,348 |
Interest income and other income (expense), net: |
|
|
|
|
|
|
|
|
|||||||
Interest income |
|
|
245 |
|
|
|
383 |
|
|
|
922 |
|
|
|
2,026 |
Other income (expense), net |
|
|
(14,832 |
) |
|
|
(483 |
) |
|
|
(26,105 |
) |
|
|
34,049 |
Total interest income and other income (expense), net |
|
|
(14,587 |
) |
|
|
(100 |
) |
|
|
(25,183 |
) |
|
|
36,075 |
Net income before provision for income taxes |
|
|
173,609 |
|
|
|
268,802 |
|
|
|
361,095 |
|
|
|
530,423 |
Provision for income taxes |
|
|
60,809 |
|
|
|
69,088 |
|
|
|
113,997 |
|
|
|
130,333 |
Net income |
|
$ |
112,800 |
|
|
$ |
199,714 |
|
|
$ |
247,098 |
|
|
$ |
400,090 |
|
|
|
|
|
|
|
|
|
|||||||
Net income per share: |
|
|
|
|
|
|
|
|
|||||||
Basic |
|
$ |
1.44 |
|
|
$ |
2.53 |
|
|
$ |
3.15 |
|
|
$ |
5.06 |
Diluted |
|
$ |
1.44 |
|
|
$ |
2.51 |
|
|
$ |
3.13 |
|
|
$ |
5.02 |
Shares used in computing net income per share: |
|
|
|
|
|
|
|
|
|||||||
Basic |
|
|
78,395 |
|
|
|
79,008 |
|
|
|
78,568 |
|
|
|
79,004 |
Diluted |
|
|
78,545 |
|
|
|
79,638 |
|
|
|
78,840 |
|
|
|
79,737 |
|
||||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS |
||||||
(in thousands) |
||||||
|
|
|
|
|
||
ASSETS |
|
|
|
|
||
|
|
|
|
|
||
Current assets: |
|
|
|
|
||
Cash and cash equivalents |
|
$ |
877,501 |
|
$ |
1,099,370 |
Marketable securities, short-term |
|
|
22,138 |
|
|
71,972 |
Accounts receivable, net |
|
|
931,854 |
|
|
897,198 |
Inventories |
|
|
310,046 |
|
|
230,230 |
Prepaid expenses and other current assets |
|
|
235,265 |
|
|
195,305 |
Total current assets |
|
|
2,376,804 |
|
|
2,494,075 |
|
|
|
|
|
||
Marketable securities, long-term |
|
|
77,551 |
|
|
125,320 |
Property, plant and equipment, net |
|
|
1,182,444 |
|
|
1,081,926 |
Operating lease right-of-use assets, net |
|
|
117,912 |
|
|
121,257 |
|
|
|
390,100 |
|
|
418,547 |
Intangible assets, net |
|
|
93,817 |
|
|
109,709 |
Deferred tax assets |
|
|
1,518,648 |
|
|
1,533,767 |
Other assets |
|
|
52,843 |
|
|
57,509 |
|
|
|
|
|
||
Total assets |
|
$ |
5,810,119 |
|
$ |
5,942,110 |
|
|
|
|
|
||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
||
|
|
|
|
|
||
Current liabilities: |
|
|
|
|
||
Accounts payable |
|
$ |
145,607 |
|
$ |
163,886 |
Accrued liabilities |
|
|
416,459 |
|
|
607,315 |
Deferred revenues |
|
|
1,242,348 |
|
|
1,152,870 |
Total current liabilities |
|
|
1,804,414 |
|
|
1,924,071 |
|
|
|
|
|
||
Income tax payable |
|
|
116,414 |
|
|
118,072 |
Operating lease liabilities |
|
|
98,332 |
|
|
102,656 |
Other long-term liabilities |
|
|
191,878 |
|
|
174,597 |
Total liabilities |
|
|
2,211,038 |
|
|
2,319,396 |
|
|
|
|
|
||
Total stockholders’ equity |
|
|
3,599,081 |
|
|
3,622,714 |
|
|
|
|
|
||
Total liabilities and stockholders’ equity |
|
$ |
5,810,119 |
|
$ |
5,942,110 |
|
||||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||||
(in thousands) |
||||||||
|
|
Six Months Ended
|
||||||
|
|
2022 |
|
2021 |
||||
CASH FLOWS FROM OPERATING ACTIVITIES |
|
|
|
|
||||
Net cash provided by operating activities |
|
$ |
157,543 |
|
|
$ |
544,691 |
|
|
|
|
|
|
||||
CASH FLOWS FROM INVESTING ACTIVITIES |
|
|
|
|
||||
Net cash used in investing activities |
|
|
(72,078 |
) |
|
|
(123,920 |
) |
|
|
|
|
|
||||
CASH FLOWS FROM FINANCING ACTIVITIES |
|
|
|
|
||||
Net cash used in financing activities |
|
|
(312,396 |
) |
|
|
(291,756 |
) |
|
|
|
|
|
||||
Effect of foreign exchange rate changes on cash, cash equivalents, and restricted cash |
|
|
4,978 |
|
|
|
(3,511 |
) |
Net (decrease) increase in cash, cash equivalents, and restricted cash |
|
|
(221,953 |
) |
|
|
125,504 |
|
Cash, cash equivalents, and restricted cash at beginning of the period |
|
|
1,100,139 |
|
|
|
961,474 |
|
Cash, cash equivalents, and restricted cash at end of the period |
|
$ |
878,186 |
|
|
$ |
1,086,978 |
|
|
||||||||||||||||||
INVISALIGN BUSINESS METRICS |
||||||||||||||||||
|
|
Q1 |
|
Q2 |
|
Q3 |
|
Q4 |
|
Q1 |
|
Q2 |
||||||
|
|
2021 |
|
2021 |
|
2021 |
|
2021 |
|
2022 |
|
2022 |
||||||
Invisalign Average Selling Price (ASP): |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Comprehensive Products ASP |
|
$ |
1,265 |
|
$ |
1,250 |
|
$ |
1,255 |
|
$ |
1,270 |
|
$ |
1,315 |
|
$ |
1,280 |
Non-Comprehensive Products ASP |
|
$ |
1,030 |
|
$ |
1,040 |
|
$ |
1,050 |
|
$ |
1,040 |
|
$ |
1,080 |
|
$ |
1,085 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Number of Invisalign Doctors Cases Were Shipped To: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
38,975 |
|
|
40,740 |
|
|
41,310 |
|
|
40,460 |
|
|
39,455 |
|
|
39,815 |
International |
|
|
39,630 |
|
|
42,725 |
|
|
44,190 |
|
|
43,080 |
|
|
42,985 |
|
|
42,460 |
Total Doctors Cases Shipped To |
|
|
78,605 |
|
|
83,465 |
|
|
85,500 |
|
|
83,540 |
|
|
82,440 |
|
|
82,275 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Invisalign Doctor Utilization Rates*: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
9.1 |
|
|
9.9 |
|
|
9.8 |
|
|
9.3 |
|
|
9.2 |
|
|
9.3 |
North American Orthodontists |
|
|
26.8 |
|
|
29.4 |
|
|
29.7 |
|
|
26.9 |
|
|
26.8 |
|
|
26.8 |
North American GP Dentists |
|
|
4.8 |
|
|
5.3 |
|
|
5.0 |
|
|
5.1 |
|
|
5.0 |
|
|
5.1 |
International |
|
|
6.8 |
|
|
7.1 |
|
|
6.5 |
|
|
6.8 |
|
|
6.4 |
|
|
6.4 |
Total Utilization Rates** |
|
|
7.6 |
|
|
8.0 |
|
|
7.7 |
|
|
7.6 |
|
|
7.3 |
|
|
7.3 |
* # of cases shipped / # of doctors to whom cases were shipped |
||||||||||||||||||
** LATAM utilization rate is not separately disclosed but included in the total utilization rates |
|
|||||||||||||||||||||
STOCK-BASED COMPENSATION |
|||||||||||||||||||||
(in thousands) |
|||||||||||||||||||||
|
|
Q1 |
|
Q2 |
|
Q3 |
|
Q4 |
|
Fiscal |
|
Q1 |
|
Q2 |
|||||||
|
|
2021 |
|
2021 |
|
2021 |
|
2021 |
|
2021 |
|
2022 |
|
2022 |
|||||||
Stock-based Compensation (SBC): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
SBC included in Gross Profit |
|
$ |
1,306 |
|
$ |
1,418 |
|
$ |
1,451 |
|
$ |
1,458 |
|
$ |
5,633 |
|
$ |
1,514 |
|
$ |
1,614 |
SBC included in Operating Expenses |
|
|
25,935 |
|
|
27,437 |
|
|
26,951 |
|
|
28,380 |
|
|
108,703 |
|
|
30,107 |
|
|
32,526 |
Total SBC |
|
$ |
27,241 |
|
$ |
28,855 |
|
$ |
28,402 |
|
$ |
29,838 |
|
$ |
114,336 |
|
$ |
31,621 |
|
$ |
34,140 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
UNAUDITED GAAP TO NON-GAAP RECONCILIATION |
|||||||||
CONSTANT CURRENCY REVENUES |
|||||||||
(in thousands, except percentages) |
|||||||||
Sequential constant currency analysis: |
|||||||||
|
|
Three Months Ended |
|
|
|||||
|
|
|
|
|
|
Impact % of
|
|||
GAAP net revenues |
|
$ |
969,553 |
|
$ |
973,219 |
|
|
|
Constant currency impact (1) |
|
|
15,268 |
|
|
|
1.6 |
% |
|
Constant currency net revenues (1) |
|
$ |
984,821 |
|
|
|
|
||
|
|
|
|
|
|
|
|||
GAAP Clear Aligner net revenues |
|
$ |
798,398 |
|
$ |
809,696 |
|
|
|
Clear Aligner constant currency impact (1) |
|
|
12,323 |
|
|
|
1.5 |
% |
|
Clear Aligner constant currency net revenues (1) |
|
$ |
810,721 |
|
|
|
|
||
|
|
|
|
|
|
|
|||
GAAP Imaging Systems and CAD/CAM Services net revenues |
|
$ |
171,155 |
|
$ |
163,523 |
|
|
|
Imaging Systems and CAD/CAM Services constant currency impact (1) |
|
|
2,945 |
|
|
|
1.7 |
% |
|
Imaging Systems and CAD/CAM Services constant currency net revenues (1) |
|
$ |
174,100 |
|
|
|
|
Year-over-year constant currency analysis: |
|||||||||
|
|
Three Months Ended |
|
|
|||||
|
|
2022 |
|
2021 |
|
Impact % of
|
|||
GAAP net revenues |
|
$ |
969,553 |
|
$ |
1,010,808 |
|
|
|
Constant currency impact (1) |
|
|
39,888 |
|
|
|
4.0 |
% |
|
Constant currency net revenues (1) |
|
$ |
1,009,441 |
|
|
|
|
||
|
|
|
|
|
|
|
|||
GAAP Clear Aligner net revenues |
|
$ |
798,398 |
|
$ |
840,959 |
|
|
|
Clear Aligner constant currency impact (1) |
|
|
32,935 |
|
|
|
4.0 |
% |
|
Clear Aligner constant currency net revenues (1) |
|
$ |
831,333 |
|
|
|
|
||
|
|
|
|
|
|
|
|||
GAAP Imaging Systems and CAD/CAM Services net revenues |
|
$ |
171,155 |
|
$ |
169,849 |
|
|
|
Imaging Systems and CAD/CAM Services constant currency impact (1) |
|
|
6,953 |
|
|
|
3.9 |
% |
|
Imaging Systems and CAD/CAM Services constant currency net revenues (1) |
|
$ |
178,108 |
|
|
|
|
Note: |
||
(1) |
We define constant currency revenues as total revenues excluding the effect of foreign exchange rate movements and use it to determine the constant currency revenue percentage change on year-on-year and quarter-on-quarter basis. Constant currency impact in dollars is calculated by translating the current period GAAP net revenues using the foreign currency exchange rates that were in effect during the previous comparable period and subtracting it by the current period GAAP net revenues. The percentage for the constant currency impact is calculated by dividing the constant currency impact in dollars (numerator) by constant currency net revenues in dollars (denominator). Refer to "About Non-GAAP Financial Measures" section of press release. |
|
||||||
UNAUDITED GAAP TO NON-GAAP RECONCILIATION CONTINUED |
||||||
CONSTANT CURRENCY INCOME FROM OPERATIONS AND OPERATING MARGIN |
||||||
(in thousands, except percentages) |
||||||
Sequential constant currency analysis: |
||||||
|
|
Three Months Ended |
||||
|
|
|
|
|
||
GAAP income from operations |
|
$ |
188,196 |
|
$ |
198,082 |
Income from operations constant currency impact (1) |
|
|
13,917 |
|
|
|
Constant currency income from operations (1) |
|
$ |
202,113 |
|
|
|
|
Three Months Ended |
||||
|
|
|
|
|
||
GAAP operating margin |
|
19.4 |
% |
|
20.4 |
% |
Operating margin constant currency impact (2) |
|
1.1 |
|
|
|
|
Constant currency operating margin (2) |
|
20.5 |
% |
|
|
Year-over-year constant currency analysis: |
||||||
|
|
Three Months Ended |
||||
|
|
2022 |
|
2021 |
||
GAAP income from operations |
|
$ |
188,196 |
|
$ |
268,902 |
Income from operations constant currency impact (1) |
|
|
31,871 |
|
|
|
Constant currency income from operations (1) |
|
$ |
220,067 |
|
|
|
|
Three Months Ended |
||||
|
|
2022 |
|
2021 |
||
GAAP operating margin |
|
19.4 |
% |
|
26.6 |
% |
Operating margin constant currency impact (2) |
|
2.4 |
|
|
|
|
Constant currency operating margin (2) |
|
21.8 |
% |
|
|
Notes: |
||
(1) |
We define constant currency income from operations as GAAP income from operations excluding the effect of foreign exchange rate movements for GAAP net revenues and operating expenses. Constant currency impact in dollars is calculated by translating the current period GAAP net revenues and operating expenses using the foreign currency exchange rates that were in effect during the previous comparable period and subtracting it by the current period GAAP net revenues and operating expenses. |
|
(2) |
We define constant currency operating margin as constant currency income from operations as a percentage of constant currency net revenues. Operating margin constant currency impact is the increase or decrease in constant currency operating margin compared to the GAAP operating margin. |
Refer to "About Non-GAAP Financial Measures" section of press release.
|
||||||||||||||||
UNAUDITED GAAP TO NON-GAAP RECONCILIATION CONTINUED |
||||||||||||||||
FINANCIAL MEASURES OTHER THAN CONSTANT CURRENCY |
||||||||||||||||
(in thousands, except per share data) |
||||||||||||||||
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
2022 |
|
2021 |
|
2022 |
|
2021 |
||||||||
GAAP gross profit |
|
$ |
687,559 |
|
|
$ |
758,538 |
|
|
$ |
1,396,905 |
|
|
$ |
1,435,636 |
|
Stock-based compensation |
|
|
1,614 |
|
|
|
1,418 |
|
|
|
3,128 |
|
|
|
2,724 |
|
Amortization of intangibles (1) |
|
|
2,393 |
|
|
|
2,175 |
|
|
|
4,880 |
|
|
|
4,350 |
|
Non-GAAP gross profit |
|
$ |
691,566 |
|
|
$ |
762,131 |
|
|
$ |
1,404,913 |
|
|
$ |
1,442,710 |
|
|
|
|
|
|
|
|
|
|
||||||||
GAAP gross margin |
|
|
70.9 |
% |
|
|
75.0 |
% |
|
|
71.9 |
% |
|
|
75.3 |
% |
Non-GAAP gross margin |
|
|
71.3 |
% |
|
|
75.4 |
% |
|
|
72.3 |
% |
|
|
75.7 |
% |
|
|
|
|
|
|
|
|
|
||||||||
GAAP total operating expenses |
|
$ |
499,363 |
|
|
$ |
489,636 |
|
|
$ |
1,010,627 |
|
|
$ |
941,288 |
|
Stock-based compensation |
|
|
(32,526 |
) |
|
|
(27,437 |
) |
|
|
(62,633 |
) |
|
|
(53,372 |
) |
Amortization of intangibles (1) |
|
|
(872 |
) |
|
|
(887 |
) |
|
|
(1,782 |
) |
|
|
(1,775 |
) |
Acquisition-related costs (2) |
|
|
— |
|
|
|
(68 |
) |
|
|
— |
|
|
|
(104 |
) |
Non-GAAP total operating expenses |
|
$ |
465,965 |
|
|
$ |
461,244 |
|
|
$ |
946,212 |
|
|
$ |
886,037 |
|
|
|
|
|
|
|
|
|
|
||||||||
GAAP income from operations |
|
$ |
188,196 |
|
|
$ |
268,902 |
|
|
$ |
386,278 |
|
|
$ |
494,348 |
|
Stock-based compensation |
|
|
34,140 |
|
|
|
28,855 |
|
|
|
65,761 |
|
|
|
56,096 |
|
Amortization of intangibles (1) |
|
|
3,265 |
|
|
|
3,062 |
|
|
|
6,662 |
|
|
|
6,125 |
|
Acquisition-related costs (2) |
|
|
— |
|
|
|
68 |
|
|
|
— |
|
|
|
104 |
|
Non-GAAP income from operations |
|
$ |
225,601 |
|
|
$ |
300,887 |
|
|
$ |
458,701 |
|
|
$ |
556,673 |
|
|
|
|
|
|
|
|
|
|
||||||||
GAAP operating margin |
|
|
19.4 |
% |
|
|
26.6 |
% |
|
|
19.9 |
% |
|
|
25.9 |
% |
Non-GAAP operating margin |
|
|
23.3 |
% |
|
|
29.8 |
% |
|
|
23.6 |
% |
|
|
29.2 |
% |
|
|
|
|
|
|
|
|
|
||||||||
GAAP total interest income and other income (expense), net |
|
$ |
(14,587 |
) |
|
$ |
(100 |
) |
|
$ |
(25,183 |
) |
|
$ |
36,075 |
|
Arbitration award gain (3) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(43,403 |
) |
Non-GAAP total interest income and other income (expense), net |
|
$ |
(14,587 |
) |
|
$ |
(100 |
) |
|
$ |
(25,183 |
) |
|
$ |
(7,328 |
) |
|
|
|
|
|
|
|
|
|
||||||||
GAAP net income before provision for income taxes |
|
$ |
173,609 |
|
|
$ |
268,802 |
|
|
$ |
361,095 |
|
|
$ |
530,423 |
|
Stock-based compensation |
|
|
34,140 |
|
|
|
28,855 |
|
|
|
65,761 |
|
|
|
56,096 |
|
Amortization of intangibles (1) |
|
|
3,265 |
|
|
|
3,062 |
|
|
|
6,662 |
|
|
|
6,125 |
|
Acquisition-related costs (2) |
|
|
— |
|
|
|
68 |
|
|
|
— |
|
|
|
104 |
|
Arbitration award gain (3) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(43,403 |
) |
Non-GAAP net income before provision for income taxes |
|
$ |
211,014 |
|
|
$ |
300,787 |
|
|
$ |
433,518 |
|
|
$ |
549,345 |
|
|
||||||||||||||||
UNAUDITED GAAP TO NON-GAAP RECONCILIATION CONTINUED |
||||||||||||||||
FINANCIAL MEASURES OTHER THAN CONSTANT CURRENCY CONTINUED |
||||||||||||||||
(in thousands, except per share data) |
||||||||||||||||
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
2022 |
|
2021 |
|
2022 |
|
2021 |
||||||||
GAAP provision for income taxes |
|
$ |
60,809 |
|
|
$ |
69,088 |
|
|
$ |
113,997 |
|
|
$ |
130,333 |
|
Tax impact on non-GAAP adjustments |
|
|
4,317 |
|
|
|
6,218 |
|
|
|
15,105 |
|
|
|
13,373 |
|
Tax related non-GAAP items (4) |
|
|
(11,065 |
) |
|
|
(16,651 |
) |
|
|
(21,234 |
) |
|
|
(34,845 |
) |
Non-GAAP provision for income taxes |
|
$ |
54,061 |
|
|
$ |
58,655 |
|
|
$ |
107,868 |
|
|
$ |
108,861 |
|
|
|
|
|
|
|
|
|
|
||||||||
GAAP effective tax rate |
|
|
35.0 |
% |
|
|
25.7 |
% |
|
|
31.6 |
% |
|
|
24.6 |
% |
Non-GAAP effective tax rate |
|
|
25.6 |
% |
|
|
19.5 |
% |
|
|
24.9 |
% |
|
|
19.8 |
% |
|
|
|
|
|
|
|
|
|
||||||||
GAAP net income |
|
$ |
112,800 |
|
|
$ |
199,714 |
|
|
$ |
247,098 |
|
|
$ |
400,090 |
|
Stock-based compensation |
|
|
34,140 |
|
|
|
28,855 |
|
|
|
65,761 |
|
|
|
56,096 |
|
Amortization of intangibles (1) |
|
|
3,265 |
|
|
|
3,062 |
|
|
|
6,662 |
|
|
|
6,125 |
|
Acquisition-related costs (2) |
|
|
— |
|
|
|
68 |
|
|
|
— |
|
|
|
104 |
|
Arbitration award gain (3) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(43,403 |
) |
Tax impact on non-GAAP adjustments |
|
|
(4,317 |
) |
|
|
(6,218 |
) |
|
|
(15,105 |
) |
|
|
(13,373 |
) |
Tax related non-GAAP items (4) |
|
|
11,065 |
|
|
|
16,651 |
|
|
|
21,234 |
|
|
|
34,845 |
|
Non-GAAP net income |
|
$ |
156,953 |
|
|
$ |
242,132 |
|
|
$ |
325,650 |
|
|
$ |
440,484 |
|
|
|
|
|
|
|
|
|
|
||||||||
GAAP diluted net income per share |
|
$ |
1.44 |
|
|
$ |
2.51 |
|
|
$ |
3.13 |
|
|
$ |
5.02 |
|
Non-GAAP diluted net income per share |
|
$ |
2.00 |
|
|
$ |
3.04 |
|
|
$ |
4.13 |
|
|
$ |
5.52 |
|
|
|
|
|
|
|
|
|
|
||||||||
Shares used in computing diluted net income per share |
|
|
78,545 |
|
|
|
79,638 |
|
|
|
78,840 |
|
|
|
79,737 |
|
Notes: |
||
(1) |
Amortization of intangible assets related to certain acquisitions |
|
(2) |
Acquisition-related costs for professional fees related to our 2020 exocad acquisition |
|
(3) |
Gain from the SDC arbitration award regarding the value of Align's capital account balance |
|
(4) |
Amortization and related adjustments to the benefit from the transferred intangible assets of our Swiss entity |
Refer to "About Non-GAAP Financial Measures" section of press release.
View source version on businesswire.com: https://www.businesswire.com/news/home/20220727005363/en/
(909) 833-5839
mvalente@aligntech.com
(828) 551-4201
sarah.johnson@zenogroup.com
Source:
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