Nevro Reports Fourth Quarter and Full-Year 2021 Financial Results and Provides First Quarter and Full-Year 2022 Guidance
Nevro Corp. reported a 4Q 2021 revenue of $102.8 million, down 6% year-over-year and 10% from 2019. The net loss was $26.2 million, with a non-GAAP adjusted EBITDA of - $7.5 million. U.S. revenue decreased 7% to $88.4 million, while international revenue fell 5% to $14.3 million. For 2022, Nevro projects first quarter revenue of $85-$87 million and annual revenue of $415-$430 million, anticipating impacts from COVID-19. Additionally, it received FDA approval for a new therapy and a positive coverage decision from UnitedHealthcare.
- FDA approval for 10 kHz High Frequency Spinal Cord Stimulation therapy for NSRBP.
- Positive UnitedHealthcare coverage decision expanding SCS coverage to PDN patients.
- Projected annual revenue growth of 7% to 11% for 2022.
- Fourth quarter 2021 revenue decreased by 6% compared to the prior year.
- 2021 net loss increased to $26.2 million from $0.9 million in the prior year.
- 2022 first quarter revenue guidance indicates a decline due to COVID-related impacts.
REDWOOD CITY, Calif., Feb. 23, 2022 /PRNewswire/ -- Nevro Corp. (NYSE: NVRO), delivering comprehensive, life-changing solutions for the treatment of chronic pain, today reported its financial results for the fourth quarter and full-year ended December 31, 2021 and provided guidance for the first quarter and full-year of 2022.
Recent Business Highlights and Guidance
- Fourth Quarter 2021 Worldwide Revenue of
$102.8 Million ; Decrease of6% Compared to Prior Year and Decrease of10% Compared to 2019 - Fourth Quarter 2021 Worldwide Revenue Includes Approximately
$4.0 Million of Painful Diabetic Neuropathy (PDN) Revenue - Fourth Quarter 2021 Net Loss from Operations of
$26.2 Million ; Fourth Quarter 2021 Non-GAAP Adjusted EBITDA of Negative$7.5 Million - January FDA Approval of 10 kHz High Frequency Spinal Cord Stimulation Therapy for Non-Surgical Refractory Back Pain (NSRBP)
- 12-month Follow-Up Results for SENZA-NSRBP Randomized Controlled Trial Published in Journal of Neurosurgery: Spine
- 12-month Follow-Up Results for SENZA-PDN Randomized Controlled Trial Published in Diabetes Care
- Positive UnitedHealthcare Coverage Decision for High-Frequency 10 kHz Therapy for Treatment of PDN
- Provides First Quarter 2022 Revenue Guidance of
$85 Million to$87 Million ; Full-Year 2022 Revenue Guidance of$415 Million to$430 Million - Provides First Quarter of 2022 Non-GAAP Adjusted EBITDA Guidance of Negative
$19 Million to Negative$20 Million ; Full-Year 2022 Non-GAAP Adjusted EBITDA Guidance of Negative$8 Million to Negative$18 Million
Fourth Quarter 2021 Financial Overview
Worldwide revenue for the fourth quarter of 2021 was
U.S. revenue in the fourth quarter of 2021 was
International revenue in the fourth quarter of 2021 was
"We were really encouraged by the progress in our core SCS business through most of the fourth quarter, as evidenced by the steady pick-up in trial activity that continued to improve from last quarter, as well as the ongoing improvement in permanent implant volumes," said D. Keith Grossman, Chairman, CEO and President of Nevro. "We saw an increase in the COVID impact on our volumes beginning in mid-December along with the Omicron surge. This impact carried into the current quarter and appears to have peaked in late January. Our PDN launch initiatives are continuing to drive awareness with referring physicians and patients, with trials growing throughout the quarter, and representing approximately seven percent of our total US trial volume. In addition, the recent positive decision by UnitedHealthcare to expand their SCS coverage to include PDN patients is expected to significantly increase patient access to our 10 kHz Therapy. These achievements, coupled with our recent FDA approval for treating NSRBP patients, further differentiate our high-frequency, paresthesia-free SCS technology and uniquely position us to deliver relief to the many patients in need of our HFX solution to free them from the burden of chronic pain. We believe we have laid a very strong foundation for future growth, and that we are very well positioned for when the impact and uncertainties of COVID on our market subsides."
Gross profit for the fourth quarter of 2021 was
Operating expenses for the fourth quarter of 2021 were
Net loss from operations for the fourth quarter of 2021 was
Cash, cash equivalents and short-term investments totaled
Full-Year 2021
Worldwide revenue for the full-year 2021 was
First Quarter and Full-Year 2022 Outlook
Nevro continues to monitor and evaluate the impact the global response to the COVID pandemic has had, and will continue to have, on its operations and financial results. This guidance is highly sensitive to the company's assumptions regarding the pace and sustainability of COVID recovery and its related impacts on patient willingness to seek elective care, healthcare facility restrictions and healthcare facility staffing limitations, all of which are difficult to predict. If these assumptions differ from the actual pace of COVID recovery and its impact on the company's markets, then the company may need to change or withdraw this guidance in the future.
Nevro expects first quarter of 2022 worldwide revenue of approximately
The company expects first quarter of 2022 non-GAAP adjusted EBITDA to be approximately negative
Nevro expects full-year 2022 worldwide revenue of approximately
The company expects full-year 2022 non-GAAP adjusted EBITDA of negative
An investor presentation for the company's fourth quarter 2021 financial results is available in the "Investors" section of Nevro's website at www.nevro.com.
Webcast and Conference Call Information
As previously announced, Nevro management will host a conference call starting at 1:30 pm PT / 4:30 pm ET today. Investors interested in listening to the call may do so by dialing (888) 330-2443 in the U.S. or +1 (240) 789-2728 internationally, using Conference ID: 3583097. A live webcast, as well as an archived recording, will also be available in the "Investors" section of Nevro's website at: www.nevro.com.
Internet Posting of Information
Nevro routinely posts information that may be important to investors in the "Investor Relations" section of its website at www.nevro.com. The company encourages investors and potential investors to consult the Nevro website regularly for important information about Nevro.
About Nevro
Headquartered in Redwood City, California, Nevro is a global medical device company focused on delivering comprehensive, life-changing solutions that continue to set the standard for enduring patient outcomes in chronic pain treatment. The company started with a simple mission to help more patients suffering from debilitating pain and developed its proprietary 10 kHz Therapy, an evidence-based, non-pharmacologic innovation that has impacted the lives of more than 80,000 patients globally.
Nevro's comprehensive HFX™ spinal cord stimulation (SCS) platform includes a Senza SCS system and support services for the treatment of chronic trunk and limb pain and painful diabetic neuropathy. Senza®, Senza II®, and Senza Omnia™ are the only SCS systems that deliver Nevro's proprietary 10 kHz Therapy. Nevro's unique support services provide every patient with an HFX Coach™ throughout their pain relief journey and every physician with HFX Cloud™ insights for enhanced patient and practice management.
Senza, Senza II, Senza Omnia, HFX, HXF Coach, HFX Cloud, HFX Connect, Nevro and the Nevro logo are trademarks of Nevro Corp.
To learn more about Nevro, connect with us on LinkedIn, Twitter, Facebook and Instagram.
Forward-Looking Statements
In addition to historical information, this press release contains forward-looking statements reflecting the company's current beliefs and expectations of management made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including: our first quarter and full-year 2022 financial guidance, including our expectations for PDN revenue in 2022; our expectations that the recent positive decision by UnitedHealthcare to expand their SCS coverage to include PDN patients will significantly increase patient access to our 10 kHz Therapy; our belief that our recent achievements, coupled with our recent FDA approval for treating NSRBP patients, further differentiate our high-frequency, paresthesia-free SCS technology and uniquely position us to deliver relief to the many patients in need of our HFX solution to free them from the burden of chronic pain; and our belief that we have laid a very strong foundation for future growth, and that we are very well positioned for when the impact and uncertainties of COVID on our market subsides. These forward-looking statements are based upon information that is currently available to us or our current expectations, speak only as of the date hereof, and are subject to numerous risks and uncertainties, including our ability to successfully commercialize our products; our ability to manufacture our products to meet demand; the level and availability of third-party payor reimbursement for our products; our ability to effectively manage our anticipated growth and the costs and expenses of operating our business; our ability to protect our intellectual property rights and proprietary technologies; our ability to operate our business without infringing the intellectual property rights and proprietary technology of third parties; competition in our industry; additional capital and credit availability; our ability to attract and retain qualified personnel; and product liability claims. These factors, together with those that are described in greater detail in our Annual Report on Form 10-K to be filed on February 23, 2022, as well as any reports that we may file with the Securities and Exchange Commission in the future, may cause our actual results, performance or achievements to differ materially and adversely from those anticipated or implied by our forward-looking statements. We expressly disclaim any obligation, except as required by law, or undertaking to update or revise any such forward-looking statements. Nevro's operating results for the fourth quarter ended December 31, 2021 are not necessarily indicative of our operating results for any future periods.
Nevro Corp. Condensed Consolidated Statements of Operations and Comprehensive Loss (in thousands, except share and per share data) | ||||||||||||||||
Three Months Ended | Year Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
(unaudited) | ||||||||||||||||
Revenue | $ | 102,760 | $ | 109,731 | $ | 386,905 | $ | 362,048 | ||||||||
Cost of revenue | 33,628 | 31,703 | 120,863 | 112,146 | ||||||||||||
Gross profit | 69,132 | 78,028 | 266,042 | 249,902 | ||||||||||||
Operating expenses: | ||||||||||||||||
Research and development | 12,709 | 11,830 | 47,665 | 45,600 | ||||||||||||
Sales, general and administrative | 82,638 | 67,073 | 309,311 | 267,154 | ||||||||||||
Certain litigation charges | — | — | 20,000 | — | ||||||||||||
Total operating expenses | 95,347 | 78,903 | 376,976 | 312,754 | ||||||||||||
Loss from operations | (26,215) | (875) | (110,934) | (62,852) | ||||||||||||
Other income (expense): | ||||||||||||||||
Interest income (expense), net | (3,698) | (6,094) | (19,078) | (18,850) | ||||||||||||
Other income (expense), net | (299) | 150 | (814) | (495) | ||||||||||||
Loss before income taxes | (30,212) | (6,819) | (130,826) | (82,197) | ||||||||||||
Provision for (benefit from) income taxes | (78) | 310 | 534 | 868 | ||||||||||||
Net loss | (30,134) | (7,129) | (131,360) | (83,065) | ||||||||||||
Changes in foreign currency translation adjustment | 182 | 702 | (469) | 991 | ||||||||||||
Changes in gains (losses) on short-term investments | (366) | (153) | (493) | (80) | ||||||||||||
Net change in other comprehensive loss | (184) | 549 | (962) | 911 | ||||||||||||
Comprehensive Loss | $ | (30,318) | $ | (6,580) | $ | (132,322) | $ | (82,154) | ||||||||
Net loss per share, basic and diluted | $ | (0.86) | $ | (0.21) | $ | (3.77) | $ | (2.47) | ||||||||
Weighted average shares used to compute net loss per share, basic and diluted | 34,968,172 | 34,509,133 | 34,823,258 | 33,677,641 | ||||||||||||
Nevro Corp. Condensed Consolidated Balance Sheets (in thousands, except share and per share data) | ||||||||
December 31, | December 31, | |||||||
2021 | 2020 | |||||||
Assets | ||||||||
Current assets | ||||||||
Cash and cash equivalents | $ | 34,710 | $ | 44,597 | ||||
Short-term investments | 327,317 | 543,373 | ||||||
Accounts receivable, net | 70,475 | 77,667 | ||||||
Inventories, net | 93,517 | 83,296 | ||||||
Prepaid expenses and other current assets | 5,185 | 4,173 | ||||||
Total current assets | 531,204 | 753,106 | ||||||
Property and equipment, net | 20,664 | 13,531 | ||||||
Operating lease assets | 17,577 | 18,142 | ||||||
Other assets | 4,493 | 4,043 | ||||||
Restricted cash | 606 | 606 | ||||||
Total assets | $ | 574,544 | $ | 789,428 | ||||
Liabilities and stockholders' equity | ||||||||
Current liabilities | ||||||||
Accounts payable | $ | 31,999 | $ | 23,109 | ||||
Short-term debt | — | 168,776 | ||||||
Accrued liabilities and other | 50,204 | 47,280 | ||||||
Total current liabilities | 82,203 | 239,165 | ||||||
Long-term debt | 151,310 | 141,771 | ||||||
Long-term operating lease liabilities | 15,402 | 16,689 | ||||||
Other long-term liabilities | 22,013 | 3,343 | ||||||
Total liabilities | 270,928 | 400,968 | ||||||
Stockholders' equity | ||||||||
Common stock, | 35 | 35 | ||||||
Additional paid-in capital | 928,138 | 880,660 | ||||||
Accumulated other comprehensive loss | (364) | 598 | ||||||
Accumulated deficit | (624,193) | (492,833) | ||||||
Total stockholders' equity | 303,616 | 388,460 | ||||||
Total liabilities and stockholders' equity | $ | 574,544 | $ | 789,428 | ||||
Nevro Corp. GAAP to Non-GAAP Adjusted EBITDA Reconciliation (unaudited) (in thousands) | ||||||||||||||||||||||||
The following table presents a reconciliation of GAAP net loss, as prepared in accordance with U.S. Generally Accepted Accounting Principles ("GAAP"), to Adjusted EBITDA, a non-GAAP financial measure. | ||||||||||||||||||||||||
Reconciliation of actual results: | ||||||||||||||||||||||||
Three Months Ended | Year Ended | |||||||||||||||||||||||
December 31, | December 31, | |||||||||||||||||||||||
2021 | 2020 | 2019 | 2021 | 2020 | 2019 | |||||||||||||||||||
(unaudited) | ||||||||||||||||||||||||
GAAP Net loss | $ | (30,134) | $ | (7,129) | $ | (13,742) | $ | (131,360) | $ | (83,065) | $ | (103,686) | ||||||||||||
Non-GAAP Adjustments: | ||||||||||||||||||||||||
Interest (income) expense, net | 3,698 | 6,094 | 1,399 | 19,078 | 18,850 | 4,911 | ||||||||||||||||||
Provision for income taxes | (78) | 310 | 481 | 534 | 868 | 1,599 | ||||||||||||||||||
Depreciation and amortization | 1,453 | 1,182 | 1,298 | 5,044 | 4,958 | 4,726 | ||||||||||||||||||
Stock-based compensation expense | 11,457 | 10,118 | 10,377 | 44,365 | 42,655 | 41,697 | ||||||||||||||||||
Certain litigation charges | — | — | — | 20,000 | — | — | ||||||||||||||||||
Litigation related expenses | 6,091 | 5,090 | 1,701 | 25,152 | 11,877 | 10,432 | ||||||||||||||||||
Adjusted EBITDA | $ | (7,513) | $ | 15,665 | $ | 1,514 | $ | (17,187) | $ | (3,857) | $ | (40,321) | ||||||||||||
Reconciliation of guidance: | ||||||||||||||||
Three Months Ended | Year Ended | |||||||||||||||
March 31, 2022 | December 31, 2022 | |||||||||||||||
(Low Case) | (High Case) | (Low Case) | (High Case) | |||||||||||||
GAAP Net Loss | $ | (41,100) | $ | (40,100) | $ | (109,700) | $ | (99,700) | ||||||||
Non-GAAP Adjustments | 21,100 | 21,100 | 91,700 | 91,700 | ||||||||||||
Adjusted EBITDA | $ | (20,000) | $ | (19,000) | $ | (18,000) | $ | (8,000) | ||||||||
Management uses certain non-GAAP financial measures, most specifically Adjusted EBITDA, as a supplement to GAAP financial measures to further evaluate the company's operating performance period over period, analyze the underlying business trends, assess performance relative to competitors and establish operational objectives.
Management believes it is important to provide investors with the same non-GAAP metrics it uses to evaluate the performance and underlying trends of the company's business operations to facilitate comparisons to its historical operating results and evaluate the effectiveness of its operating strategies. Disclosure of these non-GAAP financial measures also facilitates comparisons of the company's underlying operating performance with other companies in the industry that also supplement their GAAP results with non-GAAP financial measures.
EBITDA is a non-GAAP financial measure, which is calculated by adding interest income and expense, net; provision for income taxes; and depreciation and amortization to net income. In calculating non-GAAP Adjusted EBITDA, the company further adjusts for the following items:
- Stock-based compensation expense – The company excludes non-cash costs related to the company's stock-based plans, which include stock options, restricted stock units and performance-based restricted stock units as these expenses do not require cash settlement from the company.
- Certain litigation charges – The company excludes certain non-recurring litigation charges associated with the November 1, 2021 patent litigation legal judgement, which management considers not related to the underlying operating performance of the business.
- Litigation related expenses – The company excludes legal and professional fees associated with certain legal matters, which management considers not related to the underlying operating performance of the business.
Full-year guidance excludes the impact of foreign currency fluctuations.
The non-GAAP financial measure should not be considered in isolation from, or as a replacement for, the most directly comparable GAAP financial measures, as it is not prepared in accordance with U.S. GAAP.
Amounts may not add due to rounding.
Investors and Media:
Julie Dewey, IRC
Nevro Corp.
Chief Corp Communications & Investor Relations Officer
650-433-3247 | julie.dewey@nevro.com
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SOURCE Nevro Corp.
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