James Clemmer: Thanks, operator. Good morning, everybody, and thanks for becoming a member of us for AngioDynamics’ Fiscal 2026 First Quarter Earnings Name. Becoming a member of me right now is Steve Trowbridge, AngioDynamics’ Government Vice President and Chief Monetary Officer. We had an important first quarter. We proceed to develop throughout all areas of our enterprise and carried out particularly effectively within the med tech markets which might be vital to our future. Not solely did we ship glorious high line outcomes, we demonstrated how that income interprets into profitability. Our groups have struck the correct stability between rising revenue and investing in our future, which incorporates creating and launching new merchandise in addition to regulatory growth alternatives deliberate for the long run.
This mixture of strong income development with rising profitability is an important consequence of our strategic transformation. As lots of you recognize, we now have advanced our product portfolio from what AngioDynamics was traditionally recognized for to at least one that now competes in giant, fast-growing markets. We’re confirmed that our distinctive applied sciences can win and drive accelerated development. In Q1, we grew our income by 12%, led by the continued power of our Med Tech section, which grew 26%, marking our fourth consecutive quarter with over 20% development. We additionally achieved sturdy gross margins due to our income combine and our operations crew driving strong efficiency even whereas managing the affect of tariffs that raised some prices through the quarter.
Our Auryon enterprise has delivered one other distinctive quarter, which continues to develop effectively above market charges as we imagine, we now have the most effective expertise to ship higher outcomes for sufferers with peripheral arterial illness. We’re rising by taking share from all opponents on this house. And we’re seeing our transfer into the hospital market proceed to excel, permitting us to drive each high line development and better margins. We’re bullish on Auryon as a long-term development driver for our firm, and we’ll proceed to take a position to unlock new alternatives as demonstrated by our AMBITION BTK examine and our plans for Auryon to compete within the coronary market sooner or later.
We intend to proceed proving why we imagine our machine is the best answer out there. We wish to broaden entry the brand new alternatives that broaden the TAM that we compete in. These research will assist obtain each targets. Auryon exemplifies how our firm can take an revolutionary product, construct an important crew round it and execute with focus, which ends up in sturdy development and an important enterprise. Our Mechanical Thrombectomy enterprise grew by over 40% versus the earlier 12 months. Each AlphaVac and AngioVac noticed sturdy buyer development, and we’re happy with the variety of new customers selecting our merchandise.
We’re persevering with to see new hospitals approve our merchandise via their worth evaluation committees, and produce us into stock as permitted units, which is able to drive elevated utilization shifting ahead. The suggestions we proceed to listen to from prospects constantly highlights how just a few of the distinctive design components that we constructed into AlphaVac, present substantial benefits and make it each protected and efficient. The truth that a doctor can use AlphaVac to deal with PE with out the necessity to reinsert a guidewire to soundly navigate to the specified location is seen as an revolutionary design characteristic that saves time and simplifies use even in complicated interventional procedures.
We are going to proceed so as to add new options and broaden the potential customers for AlphaVac because the interventional remedy of PE sufferers can be a development driver for our firm for a few years. Our NanoKnife crew is delivering nice outcomes as we skilled development of over 25%. Our expanded prostate indication permits us to teach and prepare urologists on our machine and has an elevated curiosity from docs who’re looking for an efficient focal remedy choice for his or her sufferers. We’re working in the direction of the January 1 date when our CPT I code turns into efficient, which is able to assist get our sufferers handled and our prospects paid for the remedy.
Physicians are excited to make use of NanoKnife due to its extremely compelling the affected person consequence advantages in addition to the assigned cost aligning effectively with their expectations. The truth that our machine can deal with a affected person in lower than 1 hour makes it each a clinically and economically efficient answer to supply their sufferers. As a part of our effort to extend consciousness with males, who could also be looking for remedy choices, we’re launching a brand new AARP advert marketing campaign this month to teach males and their households about how our machine works and why the affected person outcomes are terrific.
We’re excited to drive elevated consciousness and schooling for sufferers and physicians as we imagine that NanoKnife can grow to be the market-leading product to deal with intermediate-risk prostate most cancers, and we’ll do every part potential to assist that chance. Our Medical System section reported very sturdy outcomes. We grew income over 2% year-over-year, led by power in most of our classes. This enterprise not solely has glorious merchandise that provide us enticing monetary returns, however can be managed and run by an important crew of people that know easy methods to compete in a couple of market on the identical time. General, Q1 was an important begin to our 12 months. We’re hitting on all cylinders. Our Med Tech enterprise is accelerating.
We’re taking share with our superior expertise, and we’re driving sustained profitability. With our sturdy pipeline of scientific catalysts, increasing market alternatives and the operational leverage we’re constructing, we’re positioned to ship vital worth creation for our shareholders. Now let me flip the decision over to Steve Trowbridge, who will present extra element on our monetary outcomes.
Stephen Trowbridge: Thanks, Jim, and good morning, all people. And as all the time, earlier than I start, I would wish to direct everybody to the presentation on our Investor Relations web site summarizing the important thing gadgets from our quarterly outcomes. Until in any other case famous, all metrics and development charges talked about throughout right now’s name are on a professional forma foundation, which exclude the outcomes of the dialysis and BioSentry companies we divested in June 2023, the PICC and midline merchandise that we divested in February 2024 and the radio frequency and Syntrax assist catheter merchandise that we discontinued additionally in February ’24. Moreover, except in any other case famous, all comparisons would be the first fiscal quarter of 2026 versus the primary fiscal quarter of 2025.
Prime line income efficiency was sturdy within the quarter. Income elevated 12.2% to $75.7 million, pushed by development throughout each our Med Tech and Med System segments. Med Tech income was $35.3 million, a 26.1% improve, and our Med System income was $40.4 million, a rise of two.3% As we talked about in our This autumn name in July, this quarter supplied a barely simpler comparability for year-over-year development than we are going to see throughout the remainder of FY ’26. Now that being mentioned, we’re actually happy with the income development we achieved throughout our first quarter.
For the primary fiscal quarter, our Med Tech platforms comprised 47% of our whole income in comparison with 41% of whole income a 12 months in the past, is illustrating the sustained execution of our technique to extend the proportion of our general income base coming from our Med Tech section. As well as, within the slides accompanying our earnings launch this morning, we illustrate the sustained development of our Med Tech section over the previous 5 years. Throughout this time, the annual income of our Med Tech section has grown from $41 million in 2020 to $127 million in 2025, representing a compound annual development fee of 25%.
Digging into our Med Tech section, our Auryon platform contributed $16.5 million in income, rising 20.1% in comparison with final 12 months. Auryon has now delivered double-digit year-over-year development for 17 consecutive quarters. As Jim talked about, this development is supported by our technique to extend the proportion of our atherectomy enterprise within the hospital facet of care. Along with this combine shift, we proceed to develop our buyer base in each the hospital and OBL settings. We additionally benefited from continued adoption internationally following CE Mark approval in September of final 12 months, which drove roughly $500,000 of income within the quarter. Mechanical thrombectomy income, which incorporates AngioVac and AlphaVac gross sales, elevated 41.2% year-over-year with income of $11.3 million.
Within the quarter, AngioVac income was $8 million, a 37.1% year-over-year improve, and AlphaVac income was $3.3 million, a 52.3% year-over-year improve. Whole NanoKnife income was $6.4 million, a rise of 26.7% with pro-growth of 31.3%. We view every of our Mechanical Thrombectomy and NanoKnife companies as strategically necessary, each within the close to and long run and are very proud of their current efficiency. We count on each to proceed to ship sturdy year-over-year development and contribute meaningfully to our margin profile and profitability shifting ahead. As I beforehand talked about, within the first quarter, our Med System section grew 2.3% year-over-year.
We have said that we imagine that our Med System section will develop within the low single digits all through the approaching years, and we’re happy with the sustained efficiency. Now shifting down the earnings assertion. Our gross margin for the primary quarter of FY ’26 was 55.3%, a 90-basis-point improve from the primary quarter of FY ’25. Main drivers of the gross margin enchancment are pricing initiatives in each our Med Tech and Med System segments, the gross sales combine shift to our higher-margin Med Tech merchandise and working efficiencies. We beforehand mentioned our technique to rightsize our manufacturing footprint to handle labor constraints at our Queensbury facility and make the most of third-party manufacturing companions.
Our operations crew has carried out a improbable job executing on our technique and has accelerated among the gross margin initiatives driving gross margin enchancment within the first half of our fiscal 12 months, forward of the scheduled completion date of January 2026. As well as, gross margin in Q1 included $1.7 million of tariff expense or roughly 220-basis-point affect. Touching briefly on tariffs. The expense in Q1 was according to our expectations. And as we mentioned final quarter, we proceed to count on to incur between $4 million and $6 million of tariff bills for the total fiscal 12 months 2026.
Whole working bills within the quarter had been $52.5 million, down to only 69.4% of gross sales in comparison with $50 million or 74% of gross sales final 12 months, as we proceed to drive working leverage within the enterprise. Turning to R&D. Our analysis and growth expense was $6.4 million or 8.5% of gross sales in comparison with $6.3 million or 9.3% of gross sales a 12 months in the past. As we beforehand said, we stay dedicated to investing in R&D initiatives to assist the long-term development of our Med Tech section, and we’re focusing on roughly 10% of gross sales going ahead. SG&A expense for the primary quarter of FY ’26 was $40.7 million, representing 53.7% of gross sales in comparison with $36.6 million or 54.2% of gross sales a 12 months in the past.
This improve in spend is basically pushed by the investments we now have highlighted in an expanded Mechanical Thrombectomy gross sales drive to assist the expansion of our Med Tech section. Our adjusted web loss for the primary quarter of FY ’26 was $4.2 million or an adjusted loss per share of $0.10 in comparison with an adjusted web lack of $4.4 million or an adjusted loss per share of $0.11 within the first quarter of final 12 months. This year-over-year enchancment is basically attributable to our Med Tech income development and the success of our expense administration initiatives.
Adjusted EBITDA within the first quarter of FY ’26 was $2.2 million in comparison with an adjusted EBITDA lack of $152,000 within the first quarter of 2025. At August 31, 2025, we had $38.8 million in money in comparison with $55.9 million in money at Could 31, 2025. As we talked about in July, money utilization is all the time highest in our first fiscal quarter. This 12 months, money utilization was a bit higher than we anticipated. We proceed to count on to be money move optimistic for the present full fiscal 12 months, and according to historic quarterly patterns, we count on to make use of roughly $3 million of money in Q2.
For Q3, we count on to make use of zero money or generate some, and we count on vital money technology in This autumn. We maintained zero debt and have the flexibleness to faucet into our revolving credit score facility, if wanted. Turning now to steerage for fiscal ’26. Based mostly on our first quarter efficiency and our expectations for the stability of the 12 months, we now count on web gross sales to be within the vary of $308 million to $313 million, raised from our beforehand issued vary of $305 million to $310 million. This elevated vary now represents development of between 5% and seven% over fiscal ’25 income of $292.7 million.
On a section foundation, we now count on Med Tech web gross sales to develop 14% to 16%, a rise from prior steerage of 12% to fifteen%, and we proceed to count on Med System gross sales to be roughly flat. For fiscal 2026, we proceed to count on gross margin to be within the vary of 53.5% to 55.5%. That is inclusive of our reiterated estimate of $4 million to $6 million of tariff affect for the total fiscal 12 months. Let me give just a little extra shade on gross margin. We do not count on to see a major step-up in margin through the stability of the 12 months.
As mentioned above, we have accelerated a few of our gross margin enchancment initiatives through the first half, and we’re seeing that right here in our first quarter outcomes. We now count on adjusted EBITDA to be within the vary of $6 million to $10 million, up from prior steerage of $3 million to $8 million, once more, inclusive of our estimated tariff affect. And at last, we now count on adjusted loss per share within the vary of $0.33 to $0.23, bettering from our prior steerage of a lack of $0.35 to $0.25. As you have simply heard, we had a improbable quarter, pushed by the continued execution of our strategic transformation. We’ve a compelling portfolio of world-class merchandise competing in enticing markets.
We’ve an important international crew, industrial, R&D, scientific, regulatory market entry, all working collectively to convey revolutionary options to our prospects, and we now have the infrastructure in place to fabricate and ship these applied sciences to our prospects effectively. Lastly, we now have a robust stability sheet, which is able to enable us to proceed to put money into development. We’re excited in regards to the momentum we have constructed and the alternatives forward of us. We stay centered on executing throughout our companies to drive sustained worthwhile development and worth creation through the stability of fiscal ’26 and past. With that, I am going to open the road for questions.
Operator: [Operator Instructions] Our first query right now comes from the road of John Younger with Canaccord Genuity.
John Younger: Jim, Steve, it is John. Congratulations on the good progress we’re seeing right here. I first needed to begin on simply steerage, if I can. If I am studying between the traces, proper, out of your feedback, Steve, it sounds just like the increase in Med Tech and the go-forward would largely be predicated on the Mechanical Thrombectomy and NanoKnife segments. Am I proper on that? And simply any shade on how we must always consider the expansion cadence between these two, particularly with reimbursement for prostate coming on-line in fiscal Q3?
Stephen Trowbridge: Thanks for the query. Sure, you are right. If you consider the elevating steerage going ahead, it’s primarily being pushed by what we’re seeing within the Mechanical Thrombectomy and NanoKnife areas. As we talked about, we’re more than happy with Auryon and the efficiency that we have seen in Auryon and the 17 consecutive quarters of development in that enterprise, had a extremely good first quarter. We count on that to proceed to be a strong contributor to our development going ahead. However we’re actually happy with what we’re seeing in Mechanical Thrombectomy and the sustained development that we have seen in each AngioVac and AlphaVac during the last handful of quarters. We count on that to proceed.
It is one of many issues that we pointed to on the finish of This autumn. We actually just like the portfolio that we now have right here in Mechanical Thrombectomy and the efficiency that we’re getting out of that crew, each right here within the U.S. in addition to globally and seeing some worldwide contribution to development. On NanoKnife, as we have mentioned, we count on NanoKnife to be a grower for us and within the brief, medium and long run. That is going to be one of many main drivers of our development. We’re enthusiastic about what we noticed right here within the first quarter. We do have that code coming into impact on January 1.
However as we mentioned, we do not count on that to be a light-weight change that is going to right away drive the hockey stick. However we’re actually happy with the continued improve in curiosity coming from the urology neighborhood, the adoption for this expertise to deal with the intermediate threat prostate most cancers affected person. We expect it is absolutely the proper answer. We will proceed to see development there.
John Younger: I respect that. After which simply as a double click on on the NanoKnife disposable income this quarter was simply actually sturdy. Any shade on how a lot of prostate was in that disposable quantity? Is there any stocking? And simply any KPIs that you might share can be nice round that.
Stephen Trowbridge: Certain. And the disposable numbers that we’re seeing in NanoKnife in addition to the capital that we’re seeing in NanoKnife, that’s being pushed by our prostate initiative. By and huge, the expansion that we’re seeing there may be all coming from prostate and the elevated consciousness that we’re speaking about with the urology neighborhood. Along with your query on stocking, it is a product that we all the time count on that prospects are going to be shopping for probes to have them on the shelf to have the ability to deal with their sufferers. So I do not assume I’d level to something as a major onetime or unnatural development that we’re seeing right here in our quarter.
We count on prospects to proceed to undertake NanoKnife as a expertise for his or her remedy choices. They are going to proceed to be shopping for probes, and we count on to see that development proceed.
Operator: The subsequent query comes from the road of Frank Takkinen with Lake Avenue Capital.
Frank Takkinen: Nice. Congrats on the quarter. I hoped I might begin in Mechanical Thrombectomy. Possibly an replace round type of hospital penetration can be useful. After which how we must always take into consideration that trending going ahead?
James Clemmer: Frank, it is Jim. So we have seen actually good uptake in curiosity on the hospital and that interprets into our gross sales crew then changing accounts into the worth evaluation committee approvals that we search. It is all the time good to have a health care provider purchase one and check out one, achieve the arrogance within the machine itself. Then to go and put it via the Vac course of, which is our final purpose to get on the shelf there. And there is a few different good merchandise in that house, as you recognize. So we’re actually happy with the adoption of the house. It is actually necessary to us. We measure it each month. We watch the adoption. We watch our procedures develop each month.
So it offers us extra confidence within the machine. After which simply listening to doctor suggestions. I spent a few days final week on the Perth convention speaking to a variety of the customers who’ve tried our machine not too long ago, who know the opposite merchandise available on the market and are actually assured in our machine and a few of these design aspect options we in-built. So Frank, we’ll watch this, measure it effectively, make investments on this house. As you recognize, we have added new gross sales reps into this fiscal 12 months based mostly upon our confidence. And we’ll hold measuring it for you. However we now have a variety of KPIs we observe internally.
Stephen Trowbridge: Sure. And Frank, simply so as to add to what Jim mentioned, I imply we’re bringing on new prospects in each the AngioVac and AlphaVac facet of the home each quarter. We’re actually happy with the trajectory that we’re seeing there. We’re nonetheless within the very early phases right here. I would not say that we’re considerably penetrated. We have a variety of alternatives to proceed to develop each AngioVac and AlphaVac within the quarters forward.
Frank Takkinen: Good. That is useful. After which possibly because it pertains to among the gross sales drive hiring you probably did in Mechanical Thrombectomy, are you able to replace us on the place that gross sales drive stands? After which, extra broadly talking, how ought to we take into consideration different industrial investments throughout the Med Tech enterprise?
James Clemmer: Sure. Good query, Frank. I do know on the final name, we talked about we ended our type of fiscal 2025 with about 40 devoted gross sales reps promoting Mechanical Thrombectomy. And we talked about we’ll make investments a few 25% improve this 12 months. So we now have now 50 folks, 50 territories recognized who’re simply solely centered on AlphaVac and AngioVac. And based mostly upon the suggestions we obtained, we expect that is the correct cadence. So you may see us proceed to develop. If an investor appears again on the success we have had with Auryon, for instance, we launched Auryon 5 years in the past. And on the time, there have been no gross sales reps so after we purchased the product, launched it.
Now we now have about 40 reps devoted to Auryon, and we added and expanded over time promoting ahead with the chance that we noticed. So we’ll do an identical mannequin with our AngioVac and AlphaVac crew, who’s carried out a extremely good job getting buyer consciousness to the extent we like. So you may see that occur over time, not simply investments in Auryon and the AlphaVac crew, however subsequent 12 months, after we get the CPT I code up and working, you may see funding in all probability over the following 3 years coming into that NanoKnife urology gross sales drive to assist service what we expect can be a variety of elevated demand.
Operator: The subsequent query is from the road of Yi Chen with H.C. Wainwright.
Eduardo Martinez-Montes: That is Eduardo on for Yi. Simply to observe up just a little bit on the combo of development and penetration versus utilization. For — I assume to begin with the thrombectomy. Is there any sense of income development attributable to the worth improve? I do know that you simply guys have been taking part in round with that given the rise in worth versus quantity. Simply to get a really feel for a way a lot is being pushed by every of these components.
Stephen Trowbridge: Sure, it is an important query. We’re seeing the flexibility to take some worth in Mechanical Thrombectomy and we’re doing that. However we’re additionally bringing on new prospects and we’re seeing development when it comes to unit gross sales in addition to utilization at our buyer base. So it is a mixture of all three. And I feel that may be a testomony to the merchandise that we now have the portfolio and the way effectively they’re actually being adopted by prospects once they get their arms on them.
Eduardo Martinez-Montes: Nice. And I assume simply any replace on the continuing scientific trials, BTK and the way you are seeing time line for development on these trials? And what in the end findings you anticipate might unlock for the markets?
Stephen Trowbridge: Sure. As we have mentioned, we expect it is a crucial scientific trial each to our product line, but in addition to the market generally for atherectomy. And we expect that Auryon has a singular place and a singular position to play in that. There’s been some publications of some IITs of physicians who’ve used Auryon to deal with below-the-knee calcifications and lesions with nice outcomes. So we’re very assured with what we’ll see. The construction of the AMBITION BTK examine, we expect, is necessary to have each the RCT section in addition to the Registry to show that you need to use Auryon, notably and atherectomy beneath the knee and get good outcomes in your sufferers.
We’re more than happy with the tempo that we’re seeing, the place we’re seeing enrollment in each the — each side of that trial within the RCT and the Registry. They’re fairly complete. So it is going to be — it is not going to be over instantly. However we’re actually happy with the tempo that we’re seeing, the uptick, the curiosity in moving into this examine with the scientific and scientific rigor that it has. And we expect it is going to be a really massive a part of our Auryon enterprise going ahead.
Operator: Right now, I am going to hand the ground again to Mr. Jim Clemmer for closing remarks.
James Clemmer: Thanks, Rob. Thanks guys for becoming a member of us right now on the decision. What you may see from us is what you have seen this quarter. Sooner or later, we imagine that we now have an organization set as much as win within the markets that we all know are sturdy. They’re tough to compete in, however we have vital expertise benefits, and we’re taking part in in the correct areas. Our crew is supported by actually good individuals who’ve helped us obtain these nice outcomes. Our groups right here, throughout the board, have come above and past. We’re an organization with a couple of shifting half, and we ask folks to do rather a lot they usually ship.
We’re additionally actually inspired by new folks becoming a member of our firm, who’re additionally thrilled to affix us based mostly upon the path we have modified this firm in the direction of, they usually wish to be part of our journey. So of us, we’re actually excited with the outcomes we simply delivered, and we’re actually bullish on our future. We expect we have modified this firm. We have set it up effectively to win. We have the correct folks to ship. So thanks once more for becoming a member of us. We’ll speak to you quickly.
Operator: This can conclude right now’s teleconference. You could disconnect your traces right now. Thanks in your participation.
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AngioDynamics (ANGO) Q1 2026 Earnings Transcript was initially printed by The Motley Idiot
