Sonendo, Inc. (“Sonendo”), a leading dental technology company
and developer of the GentleWave® System, today reported financial
results for the quarter ended September 30, 2022.
Recent Highlights
- Total revenue of $9.8 million for the third quarter of 2022,
representing growth of 25%, compared to prior year period
- Consumable revenue of $4.8 million for the third quarter of
2022, representing growth of approximately 30% compared to prior
year period
- GentleWave's ending install base as of September 30, 2022, was
approximately 935 units
- Completed a private financing resulting in $63 million of gross
proceeds
- In mid-October, announced release of the next generation
GentleWave G4 console
"The third quarter of 2022 was a strong period for Sonendo and
we achieved significant milestones despite sector-wide headwinds as
we continue our journey to capitalize on the huge opportunity that
exists in this segment of dentistry. Accomplishments included a
notable financing that resulted in proceeds of $63 million, record
procedure instruments sales of $4.8 million, and preparation for
the launch of our next generation GentleWave G4 console," said
Bjarne Bergheim, Chief Executive Officer of Sonendo. "We believe
that these milestones show clearly that there is strong
acknowledgement of the opportunity by investors, our investment in
new technology and continued adoption by doctors. We are pleased by
our operating performance this quarter, and we look forward to
steady growth in future periods."
Third Quarter 2022 Financial Results
Total revenue was $9.8 million in the third quarter of 2022, an
increase from $7.9 million in the third quarter of 2021. GentleWave
console revenue was $2.1 million in the third quarter of 2022, an
increase from $1.8 million in the third quarter of 2021. Procedure
instrument revenue was $4.8 million, an increase from $3.7 million
in the third quarter of 2021. Software revenue was $2.1 million, an
increase from $1.7 million in the third quarter of 2021.
As of September 30, 2022, GentleWave ending install base was
approximately 935 units, compared to approximately 750 in the prior
year period.
Gross margin for third quarter of 2022 was 24%, in line with the
first half of 2022, but a decrease from 26% in the third quarter of
2021.
Total operating expenses in the third quarter of 2022 were $16.9
million, compared to $13.1 million in the third quarter of
2021.
GAAP loss from operations was $14.6 million in the third quarter
of 2022, compared to $11.1 million in the third quarter of
2021.
Non-GAAP loss from operations was $12.4 million in the third
quarter of 2022 compared to $10.0 million in the third quarter of
2021. Non-GAAP loss from operations excludes revaluation of
contingent consideration, stock-based compensation expense, and
depreciation and amortization expense.
Net loss was $15.5 million for the third quarter of 2022,
compared to $12.7 million in the third quarter of 2021.
As of September 30, 2022, cash and cash equivalents and
short-term investments totaled $105.6 million, while long-term
borrowings totaled $40.0 million.
2022 Financial Guidance
The Company expects full year 2022 total revenue to be in the
range of $40.5 million to $42.5 million, representing annual growth
between 22% and 28%.
Webcast and Conference Call Information
Sonendo will host a conference call to discuss the third quarter
2022 financial results after the market close on Wednesday,
November 9th, 2022, at 1:30 p.m. Pacific Time / 4:30 p.m. Eastern
Time. Investors interested in listening to the conference call may
do so by dialing (844) 200-6205 for domestic callers or (929)
526-1599 for international callers, using access code: 579984. Live
audio of the webcast will be available on the "Investors" section
of the company's website at: https://investor.sonendo.com. The
webcast will be archived and available for replay for at least 90
days after the event.
About Sonendo
Sonendo is a commercial-stage medical technology company focused
on saving teeth from tooth decay, the most prevalent chronic
disease globally. Sonendo develops and manufactures the GentleWave®
System, an innovative technology platform designed to treat tooth
decay by cleaning and disinfecting the microscopic spaces within
teeth without the need to remove tooth structure. The system
utilizes a proprietary mechanism of action, which combines
procedure fluid optimization, broad-spectrum acoustic energy and
advanced fluid dynamics, to debride and disinfect deep regions of
the complex root canal system in a less invasive procedure that
preserves tooth structure. The clinical benefits of the GentleWave
System when compared to conventional methods of root canal therapy
include improved clinical outcomes, such as superior cleaning that
is independent of root canal complexity and tooth anatomy, high and
rapid rates of healing and minimal to no post-operative pain. In
addition, the GentleWave System can improve the workflow and
economics of dental practices. Sonendo is also the parent company
of TDO® Software, the developer of widely used endodontic practice
management software solutions, designed to simplify practice
workflow. TDO Software integrates practice management, imaging,
referral reporting and CBCT imaging, and offers built-in
communication with the GentleWave System.
For more information about Sonendo and the GentleWave System,
please visit www.sonendo.com. To find a GentleWave doctor in your
area, please visit www.gentlewave.com.
Forward Looking Statements
In addition to background and historical information, this press
release contains "forward-looking statements" based on Sonendo's
current expectations, forecasts and beliefs including statements
related to Sonendo's 2022 financial guidance. These forward-looking
statements are subject to inherent uncertainties, risks, and
assumptions that are difficult to predict. Actual outcomes and
results could differ materially due to a number of factors,
including the ongoing uncertainty of the impact of the COVID-19
pandemic, as well as COVID recovery impact, on its business. These
and other risks and uncertainties include those described more
fully in the company's Annual Report on Form 10-K for the year
ended December 31, 2021 filed with the U.S. Securities and Exchange
Commission (SEC) on March 23, 2022 under the sections titled "Risk
Factors" and "Management’s Discussion and Analysis of Financial
Condition and Results of Operation”, as well as any reports that we
may file with the SEC in the future. Forward-looking statements
contained in this announcement are based on information available
to Sonendo as of the date hereof. Sonendo undertakes no obligation
to update such information except as required under applicable law.
These forward-looking statements should not be relied upon as
representing Sonendo’s views as of any date subsequent to the date
of this press release and should not be relied upon as prediction
of future events. In light of the foregoing, investors are urged
not to rely on any forward-looking statement in reaching any
conclusion or making any investment decision about any securities
of Sonendo.
Use of Non-GAAP Financial Measures
Sonendo’s financial results are prepared in accordance with
accounting principles generally accepted in the United States of
America (“GAAP”). This press release and the reconciliation tables
included in the financial schedules below include non-GAAP loss
from operations. Non-GAAP loss from operations exclude, as
applicable, (i) revaluation of contingent consideration, (iii)
stock-based compensation expense, and (iii) depreciation and
amortization. Management believes that non-GAAP loss from
operations are useful in helping identify the company’s core
operating performance and enables management to consistently
analyze the period-to-period financial performance of the core
business operations. Management also believes that non-GAAP loss
from operations, will enable investors to assess the company in the
same way that management has historically assessed the company’s
operating results against comparable companies with conventional
accounting methodologies. The company’s definitions of non-GAAP
loss from operations have limitations as analytical tools and may
differ from other companies reporting similarly named measures.
Non-GAAP measures should not be considered measures of financial
performance under GAAP, and the items excluded from such non-GAAP
measures should not be considered in isolation or as alternatives
to financial statement data presented in the financial statements
as an indicator of financial performance or liquidity. Non-GAAP
measures should be considered in addition to results prepared in
accordance with GAAP but should not be considered a substitute for
or superior to GAAP results.
For a reconciliation of our non-GAAP loss from operations
presented herein to GAAP loss from operations, the most directly
comparable GAAP financial measures, please see “Reconciliation of
GAAP to Non-GAAP Loss from Operations” in the financial schedules
below.
SONENDO, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(in thousands, except share
data)
As of
September 30,
December 31,
2022
2021
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents
$
68,512
$
84,641
Short-term investments
37,074
—
Accounts receivable, net
3,349
2,516
Inventory
15,185
8,150
Prepaid expenses and other current
assets
2,911
3,552
Total current assets
127,031
98,859
Property and equipment, net
2,739
2,366
Operating lease right-of-use assets
2,140
2,746
Intangible assets, net
2,458
2,956
Goodwill
8,454
8,454
Other assets
118
118
Total assets
$
142,940
$
115,499
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities:
Accounts payable
$
2,057
$
3,061
Accrued expenses
5,098
4,758
Accrued compensation
3,959
3,376
Operating lease liabilities
982
975
Other current liabilities
2,249
2,482
Total current liabilities
14,345
14,652
Operating lease liabilities, net of
current
1,121
1,730
Term loan, net of current
36,599
26,496
Other liabilities
519
558
Total liabilities
52,584
43,436
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.001 par value;
authorized —10,000,000 shares; issued and outstanding - none
—
—
Common stock, $0.001 par value; authorized
— 500,000,000 shares; issued — 49,803,355 shares as of September
30, 2022 and 26,383,225 shares as of December 31, 2021; outstanding
— 49,756,666 shares as of September 30, 2022 and 26,336,536 shares
as of December 31, 2021
50
26
Additional paid-in-capital
448,648
384,132
Accumulated other comprehensive loss
(49
)
—
Accumulated deficit
(358,242
)
(312,044
)
90,407
72,114
Less: Treasury stock
(51
)
(51
)
Total stockholders’ equity
90,356
72,063
Total liabilities and stockholders’
equity
$
142,940
$
115,499
SONENDO, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF
OPERATIONS AND COMPREHENSIVE
LOSS
(unaudited)
(In thousands, except share
and per share data)
Three Months Ended
Nine Months Ended
September 30,
September 30,
September 30,
September 30,
2022
2021
2022
2021
Product revenue
$
7,795
$
6,186
$
23,440
$
18,166
Software revenue
2,051
1,701
5,986
5,140
Total revenue
9,846
7,887
29,426
23,306
Cost of sales
7,528
5,838
22,276
17,422
Gross profit
2,318
2,049
7,150
5,884
Operating expenses:
Selling, general and administrative
12,586
8,495
37,393
22,400
Research and development
4,328
4,633
13,196
14,310
Change in fair value of contingent
earnout
—
19
—
12
Total operating expenses
16,914
13,147
50,589
36,722
Loss from operations
(14,596
)
(11,098
)
(43,439
)
(30,838
)
Other expense, net:
Interest and financing costs, net
(943
)
(1,076
)
(2,759
)
(3,224
)
Change in fair value of warrant
liabilities
—
(159
)
—
(176
)
Change in fair value of forward
obligation
—
(400
)
—
(550
)
Loss before income tax expense
(15,539
)
(12,733
)
(46,198
)
(34,788
)
Income tax expense
—
—
—
—
Net loss
$
(15,539
)
$
(12,733
)
$
(46,198
)
$
(34,788
)
Other comprehensive loss (net of tax):
Unrealized loss on marketable
securities
(7
)
—
(49
)
—
Net comprehensive loss
$
(15,546
)
$
(12,733
)
$
(46,247
)
$
(34,788
)
Net loss per share attributable to common
stock – basic and diluted
$
(0.47
)
$
(10.33
)
$
(1.61
)
$
(28.54
)
Weighted-average shares outstanding –
basic and diluted
33,116,536
1,232,921
28,688,018
1,218,815
SONENDO, INC.
RECONCILIATION OF GAAP TO
NON-GAAP
LOSS FROM OPERATIONS
(In thousands;
unaudited)
Three Months Ended
Nine Months Ended
September 30,
September 30,
September 30,
September 30,
2022
2021
2022
2021
GAAP loss from operations
$
14,596
$
11,098
$
43,439
$
30,838
Adjustments:
Revaluation of contingent
consideration
—
(19
)
—
(12
)
Stock based compensation:
Included in cost of sales
(123
)
(50
)
(364
)
(157
)
Included in selling, general and
administrative
(1,435
)
(368
)
(3,820
)
(909
)
Included in research and development
(165
)
(123
)
(887
)
(382
)
Depreciation and amortization
Included in cost of sales
(168
)
(164
)
(507
)
(464
)
Included in selling, general and
administrative
(232
)
(270
)
(613
)
(818
)
Included in research and development
(33
)
(69
)
(122
)
(247
)
Non-GAAP loss from operations
$
12,440
$
10,035
$
37,126
$
27,849
View source
version on businesswire.com: https://www.businesswire.com/news/home/20221109005811/en/
Investor Contact: Gilmartin Group Greg Chodaczek
IR@Sonendo.com
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