InMode Reports Fourth Quarter and Full Year 2023 Financial Results; Quarterly Revenue of $126.8M and Record Full Year Revenue of $492M
YOKNEAM, Israel, Feb. 13, 2024 /PRNewswire/ -- InMode Ltd. (Nasdaq: INMD) ("InMode"), a leading global provider of innovative medical technologies, today announced its consolidated financial results for the fourth quarter and full year ended December 31, 2023.
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Fourth Quarter 2023 Highlights:
-- Quarterly revenue of $126.8 million, compared to $133.6 in the fourth
quarter of 2022.
-- Quarterly revenues from consumables and service of $20.5 million, an
increase of 20% compared to the fourth quarter of 2022.
-- Total cash position of $741.6 million as of December 31, 2023, including
cash and cash equivalents, marketable securities, and short-term bank
deposits.
Full Year 2023 Highlights:
-- Record full year revenue of $492 million, a year-over-year increase of
8%.
-- Record GAAP net income of $197.9 million, compared to $161.5 million in
2022; record *non-GAAP net income of $221.5 million, compared to $207.5
million in 2022.
-- 18% increase in international (non-U.S.) revenues as compared to 2022.
U.S. GAAP Results
(U.S. dollars in thousands, except for per share data)
Q4 2023 Q4 2022 FY 2023 FY 2022
Revenues $126,781 $133,571 $492,048 $454,271
Gross Margins 84 % 84 % 84 % 84 %
Net Income $55,165 $37,708 $197,919 $161,520
Earnings per Diluted Share $0.64 $0.44 $2.30 $1.89
*Non-GAAP Results
(U.S. dollars in thousands, except for per share data)
Q4 2023 Q4 2022 FY 2023 FY 2022
Gross Margins 84 % 85 % 84 % 84 %
Net Income $61,487 $66,370 $221,519 $207,486
Earnings per Diluted Share $0.71 $0.78 $2.57 $2.42
*Please refer to "Use of Non-GAAP Financial Measures" below for important information about non-GAAP financial measures. A
reconciliation between U.S. GAAP and non-GAAP Statement of Income
is provided following the financial statements that are
included in this release. Non-GAAP results exclude share-based compensation adjustments.in 2022
The Company applied the
provisions of the amendment to the Investment Law to its exempt profits accrued prior to 2020 and made a one-time payment of
$12.0 million to the Israeli Tax Authority. In addition, the Company reached agreement with the Israeli Tax Authority under which
the Company paid during January 2023 approximately $14.3 million on its undistributed exempt income for the year ended
December 31, 2021. As a result, approximately $313.2 million of the Company's undistributed exempt income for years 2012
through 2021 may be distributed or used by the Company without being subject to additional corporate tax.
Management Comments
"In 2023, particularly the latter half, we saw challenges both for InMode and the aesthetics industry, including the surgical aesthetic sector," said Moshe Mizrahy, Chairman and Chief Executive Officer. "However, we successfully introduced two exciting platforms, Define and Envision, which gained substantial market traction.
"Looking ahead, we plan to launch 2 new platforms this year and believe that our market share will continue to grow as we introduce new and innovative technologies for minimally invasive aesthetics treatments. Our unique technology and continued commitment to bringing new platforms to market are pivotal in establishing InMode as a global leader in the aesthetics medical device industry worldwide," Moshe Mizrahy concluded.
Fourth Quarter and Full Year 2023 Financial Results
Total revenues for the fourth quarter of 2023 reached $126.8 million, compared to $133.6 in the fourth quarter of 2022. Total revenues for 2023 were $492 million, an increase of 8% as compared to 2022. This increase was primarily attributable to the growth in our consumables sales and our expansion in international markets, with international revenues growing 18% year over year.
GAAP gross margin for the fourth quarter of 2023 and 2022 was 84%. *Non-GAAP gross margin for the fourth quarter of 2023 was 84% compared to a gross margin of 85% for the fourth quarter 2022. GAAP and *Non-GAAP gross margin for 2023 and 2022 was 84%.
GAAP operating margin for the fourth quarter of 2023 was 40%, compared to an operating margin of 45% in the fourth quarter of 2022. *Non-GAAP operating margin for the fourth quarter of 2023 was 45% compared to 50% for the fourth quarter of 2022. GAAP operating margin for 2023 was 40%, compared to the operating margin of 44% in 2022. *Non-GAAP operating margin for 2023 was 45%, compared to the operating margin of 49% in the full year of 2022. This decrease was primarily attributable to higher sales and marketing expenses, mainly because of the addition of new sales representatives, higher travel expenses, as well as investment in direct-to-consumer advertising campaigns and hosting in-person events to support the company's growth projections.
InMode reported GAAP net income of $55.2 million, or $0.64 per diluted share, in the fourth quarter of 2023, compared to $37.7 million, or $0.44 per diluted share, in the fourth quarter of 2022. On a *non-GAAP basis, InMode reported net income of $61.5 million, or $0.71 per diluted share, in the fourth quarter of 2023, compared to $66.4 million, or $0.78 per diluted share, in the fourth quarter of 2022. GAAP net income of $197.9 million, or $2.3 per diluted share, in 2023. This is compared with GAAP net income of $161.5 million, or $1.89 per diluted share, in 2022. On a *non-GAAP basis, InMode reported net income of $221.5 million, or $2.57 per diluted share, in the full year of 2023, compared to net income of $207.5 million, or $2.42 per diluted share, in the full year of 2022.
As of December 31, 2023, InMode had cash and cash equivalents, marketable securities, and short-term bank deposits of $741.6 million.
2024 Financial Outlook
Management provided an outlook for the full year of 2024 ending December 31, 2024. Based on current estimates, management expects:
-- Revenue between $495 million and $505 million
-- *Non-GAAP gross margin between 83% and 85%
-- *Non-GAAP income from operations between $217 million and $222 million
-- *Non-GAAP earnings per diluted share between $2.53 and $2.57
This outlook is not a guarantee of future performance and stockholders should not rely on such forward-looking statements. See "Forward-Looking Statements" for additional information.
*Please refer to "Use of Non-GAAP Financial Measures" below for important information about non-GAAP financial measures. A reconciliation between U.S. GAAP and non-GAAP Statement of Income is provided following the financial statements that are included in this release. Non-GAAP results exclude share-based compensation adjustments. in 2022 The Company applied the provisions of the amendment to the Investment Law to its exempt profits accrued prior to 2020 and made a one-time payment of $12.0 million to the Israeli Tax Authority. In addition, the Company reached agreement with the Israeli Tax Authority under which the Company paid during January 2023 approximately $14.3 million on its undistributed exempt income for the year ended December 31, 2021. As a result, approximately $313.2 million of the Company's undistributed exempt income for years 2012 through 2021 may be distributed or used by the Company without being subject to additional corporate tax.
The Current Situation in Israel
Regarding the current situation in Israel, management would like to assure investors that the Company is prioritizing the safety and well-being of its employees, and all its team are safe. InMode doesn't anticipate any significant interruption or delay in production or shipment. InMode's inventory levels globally and in Israel are adequate and include components and subassemblies for at least 6 months.
Use of Non-GAAP Financial Measures
In addition to InMode's operating results presented in accordance with GAAP, this release contains certain non-GAAP financial measures including non-GAAP net income, non-GAAP earnings per diluted share, and non-GAAP operating margin. Because these measures are used in InMode's internal analysis of financial and operating performance, management believes they provide investors with greater transparency of its view of InMode's economic performance. Management also believes the presentation of these measures, when analyzed in conjunction with InMode's GAAP operating results, allows investors to more effectively evaluate and compare InMode's performance to that of its peers, although InMode's presentation of its non-GAAP measures may not be strictly comparable to the similarly titled measures of other companies. Schedules reconciling each of these non-GAAP financial measures are provided as a supplement to this release.
Conference Call Information
Mr. Moshe Mizrahy, Chairman and Chief Executive Officer, Dr. Michael Kreindel, Co-Founder and Chief Technology Officer, Mr. Yair Malca, Chief Financial Officer, Mr. Shakil Lakhani, President of North America, and Dr. Spero Theodorou, Chief Medical Officer, will host a conference call today, February 13, 2024, at 8:30 a.m. Eastern Time to discuss the fourth quarter 2023 financial results.
The Company encourages participants to pre-register for the conference call using the following link: https://dpregister.com/sreg/10185217/fb446e05e4.
Callers will receive a unique dial-in number upon registration, which enables immediate access to the call. Participants may pre-register at any time, including up to and after the call start time.
For callers who opt out of pre-registration, please dial one of the following teleconferencing numbers. Please begin by placing your call 10 minutes before the conference call commences. If you are unable to connect using the toll-free number, please try the international dial-in number.
U.S. Toll-Free Dial-in Number: 1-833-316-0562
Israel Toll- Free Dial-in Number: 1-80-921-2373
International Dial-in Number: 1-412-317-5736
Webcast URL: https://event.choruscall.com/mediaframe/webcast.html?webcastid=6h4ExUgZ
At:
8:30 a.m. Eastern Time
5:30 a.m. Pacific Time
The conference call will also be webcast live from a link on InMode's website at https://inmodemd.com/investors/events-presentations/. A replay of the conference call will be available from February 13, 2024, at 12 p.m. Eastern Time to February 27, 2024, at 11:59 p.m. Eastern Time. To access the replay, please dial one of the following numbers:
Replay Dial-in U.S TOLL-FREE: 1-877-344-7529
Replay Dial-in Canada TOLL-FREE: 855-669-9658
Replay Dial-in TOLL/INTERNATIONAL: 1-412-317-0088
Replay Pin Number: 6723856
To access the replay using an international dial-in number, please select the link below: https://services.choruscall.com/ccforms/replay.html
A replay of the conference call will also be available for 90 days on InMode's website at https://inmodeinvestors.com/.
About InMode
InMode is a leading global provider of innovative medical technologies. InMode develops, manufactures, and markets devices harnessing novel radio frequency ("RF") technology. InMode strives to enable new emerging surgical procedures as well as improve existing treatments. InMode has leveraged its medically accepted minimally invasive RF technologies to offer a comprehensive line of products across several categories for plastic surgery, gynecology, dermatology, otolaryngology, and ophthalmology. For more information about InMode, please visit www.inmodemd.com.
Forward-Looking Statements
The information in this press release includes forward-looking statements within the meaning of the federal securities laws. These statements generally relate to future events or InMode's future financial or operating performance, including the 2024 revenue projection described above. Actual outcomes and results may differ materially from what is expressed or forecast in such forward-looking statements. In some cases, you can identify these statements because they contain words such as "anticipate," "believe," "estimate," "expect," "intend," "may," "plan," "predict," "project," "will," "would" and similar expressions that concern our expectations, strategic plans or intentions. Forward-looking statements are based on management's current expectations and assumptions, and are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Consequently, actual results could differ materially from those indicated in these forward-looking statements. When considering these forward-looking statements, you should keep in mind the risk factors and other cautionary statements included in InMode's Annual Report on Form 20-F filed with the Securities and Exchange Commission on February 14, 2023, and our future public filings. InMode undertakes no obligation and does not intend to update these forward-looking statements to reflect events or circumstances occurring after this press release. You are cautioned not to place undue reliance on these forward-looking statements, which pertain only as of the date of this press release.
Company Contact: Investor Relations
Contact:
Yair Malca
Miri Segal
Chief Financial Officer
MS-IR LLC
Phone: (949) 305-0108 Phone: (917) 607-8654
Email: Yair.Malca@inmodemd.com Email: ir@inmodemd.com
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INMODE LTD.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(U.S. dollars in thousands, except for per share data)
(Unaudited)
Three months ended Year Ended
December 31,
December 31,
2023 2022 2023 2022
REVENUES 126,781 133,571 492,048 454,271
COST OF REVENUES 20,264 21,002 80,708 73,485
GROSS PROFIT 106,517 112,569 411,340 380,786
OPERATING EXPENSES:
Research and development 3,473 3,261 13,410 12,425
Sales and marketing 49,451 47,012 193,042 160,576
General and administrative 2,349 2,398 9,228 9,931
TOTAL OPERATING EXPENSES 55,273 52,671 215,680 182,932
INCOME FROM OPERATIONS 51,244 59,898 195,660 197,854
Finance income, net 8,920 3,962 21,607 3,612
INCOME BEFORE TAXES 60,164 63,860 217,267 201,466
INCOME TAXES 4,999 26,152 19,348 39,946
NET INCOME 55,165 37,708 197,919 161,520
NET INCOME PER SHARE:
Basic 0.66 0.46 2.37 1.96
Diluted 0.64 0.44 2.30 1.89
WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING USED IN COMPUTATION OF NET
INCOME PER SHARE (in thousands)
Basic 83,862 82,449 83,534 82,482
Diluted 85,835 85,288 85,954 85,404
INMODE LTD.
CONDENSED CONSOLIDATED BALANCE SHEETS
(U.S. dollars in thousands, except for per share data)
(Unaudited)
December 31, December 31,
2023 2022
Assets
CURRENT ASSETS:
Cash and cash equivalents 144,411 97,540
Marketable securities
(amortized cost of $375,829 and $384,320, as of 373,647 374,589
December 31, 2023 and 2022, respectively)
Short-term bank deposits 223,547 75,254
Accounts receivable, net of allowance for credit losses of $1,538 and $836, 42,362 26,997
as of December 31, 2023 and 2022, respectively
Other receivables 16,268 15,094
Inventories 45,095 39,897
TOTAL CURRENT ASSETS 845,330 629,371
NON-CURRENT ASSETS:
Accounts receivable, net of allowance for credit losses of $716 and $482 3,670 3,973
as of December 31, 2023 and 2022, respectively
Deferred income tax asset, net 1,506 3,094
Operating lease right-of-use assets 9,698 5,073
Property and equipment, net 2,382 2,298
Other investments 700 600
TOTAL NON-CURRENT ASSETS 17,956 15,038
TOTAL ASSETS 863,286 644,409
Liabilities and shareholders' equity
CURRENT LIABILITIES:
Accounts payable 13,966 16,242
Contract liabilities 10,923 13,798
Other liabilities 39,247 51,980
TOTAL CURRENT LIABILITIES 64,136 82,020
NON-CURRENT LIABILITIES:
Contract liabilities 3,766 3,959
Other liabilities 1,399 303
Operating lease liabilities 6,613 3,509
TOTAL NON-CURRENT LIABILITIES 11,778 7,771
TOTAL LIABILITIES 75,914 89,791
TOTAL SHAREHOLDERS' EQUITY 787,372 554,618
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 863,286 644,409
INMODE LTD.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(U.S. dollars in thousands, except for per share data)
(Unaudited)
Three months ended Year Ended
December 31, December 31,
2023 2022 2023 2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income 55,165 37,708 197,919 161,520
Adjustments required to reconcile net income to net cash provided by operating activities:
Depreciation and amortization 122 218 623 680
Share-based compensation expenses 6,322 7,148 23,600 24,452
Allowance for doubtful accounts 355 47 1,020 449
Loss on marketable securities, net - 22 71
Finance expenses (income), net (1,581) (2,737) (4,714) (1,210)
Deferred income taxes, net (30) (72) (184) 84
Changes in operating assets and liabilities:
Decrease (increase) in accounts receivable 377 805 (16,084) (10,415)
Decrease (increase) in other receivables 3,143 (1,081) (2,224) (1,787)
Increase in inventories (5,106) (4,087) (5,198) (18,871)
Increase (decrease) in accounts payable 1,633 2,946 (2,276) 7,463
Increase (decrease) in other liabilities 204 14,575 (12,588) 17,941
Increase (decrease) in contract liabilities 562 1,660 (3,068) 1,201
Net cash provided by operating activities 61,166 57,152 176,826 181,578
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment in short-term deposits (67,101) (233,241) (93,701)
Proceeds from short-term deposits - 85,090 73,090
Purchase of fixed assets (21) (328) (705) (1,575)
Other investments (100) (100)
Purchase of marketable securities (52,527) (70,944) (245,337) (168,680)
Proceeds from sale of marketable securities 5,000 5,000 2,303
Proceeds from maturity of marketable securities 63,159 32,997 253,229 79,089
Net cash used in investing activities (51,590) (38,275) (136,064) (109,474)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repurchase of ordinary shares - (42,637)
Exercise of options 275 637 5,504 1,552
Net cash provided by (used in) financing activities 275 637 5,504 (41,085)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS 827 978 605 (1,615)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 10,678 20,492 46,871 29,404
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 133,733 77,048 97,540 68,136
CASH AND CASH EQUIVALENTS AT END OF PERIOD 144,411 97,540 144,411 97,540
INMODE LTD.
CONDENSED CONSOLIDATED FINANCIAL HIGHLIGHTS
(U.S. dollars in thousands, except for per share data)
(Unaudited)
Three months ended Year ended
December 31, December 31,
2023 2022 2023 2022
Revenues by Category:
Capital Equipment revenues - United States 69,253 55 % 80,352 60 % 260,801 53 % 260,992 58 %
Capital Equipment revenues - International 37,004 29 % 36,094 27 % 151,288 31 % 133,220 29 %
Total Capital Equipment revenues 106,257 84 % 116,446 87 % 412,089 84 % 394,212 87 %
Consumables and service revenues 20,524 16 % 17,125 13 % 79,959 16 % 60,059 13 %
Total Net Revenue 126,781 100 % 133,571 100 % 492,048 100 % 454,271 100 %
Three months ended December 31, Year ended December 31,
2023 2022 2023 2022
%
%
%
%
United International Total United International Total United International Total United
States States States States International Total
Revenues by Technology:
Minimal-Invasive 84 80 83 86 76 83 86 77 83 85 74 81
Hands-Free 12 4 9 11 4 9 11 5 8 12 6 10
Non-Invasive 4 16 8 3 20 8 3 18 9 3 20 9
100 100 100 100 100 100 100 100 100 100 100 100
INMODE LTD.
RECONCILIATION OF GAAP CONDENSED CONSOLIDATED STATEMENTS OF
INCOME TO NON-GAAP CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(U.S. dollars in thousands, except for per share data)
(Unaudited)
Three months ended
December 31, 2023 Three months ended December 31, 2022
GAAP Share Based Non-GAAP GAAP Share Based Undistributed
Compensation Compensation Exempt Income Non-GAAP
REVENUES 126,781 126,781 133,571 133,571
COST OF REVENUES 20,264 (573) 19,691 21,002 (553) 20,449
GROSS PROFIT 106,517 573 107,090 112,569 553 113,122
OPERATING EXPENSES:
Research and development 3,473 (665) 2,808 3,261 (918) 2,343
Sales and marketing 49,451 (4,611) 44,840 47,012 (5,069) 41,943
General and administrative 2,349 (473) 1,876 2,398 (608) 1,790
TOTAL OPERATING 55,273 (5,749) 49,524 52,671 (6,595) 46,076
EXPENSES
INCOME FROM OPERATIONS 51,244 6,322 57,566 59,898 7,148 67,046
Finance income, net 8,920 3,962 3,962
8,920
INCOME BEFORE TAXES 60,164 6,322 66,486 63,860 7,148 71,008
INCOME TAXES 4,999 4,999 26,152 (21,514) 4,638
NET INCOME 55,165 6,322 61,487 37,708 7,148 21,514 66,370
NET INCOME PER SHARE:
Basic 0.66 0.73 0.46 0.80
Diluted 0.64 0.71 0.44 0.78
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING USED IN COMPUTATION OF NET INCOME PER SHARE (in
thousands)
Basic 83,862 83,862 82,449 82,449
Diluted 85,835 86,196 85,288 85,515
INMODE LTD.
RECONCILIATION OF GAAP CONDENSED CONSOLIDATED STATEMENTS OF
INCOME TO NON-GAAP CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(U.S. dollars in thousands, except for per share data)
(Unaudited)
Year Ended December 31, 2023 Year Ended December 31, 2022
GAAP Share Based Non-GAAP GAAP Share Based Undistributed
Exempt Income Non-GAAP
Compensation Compensation
REVENUES 492,048 492,048 454,271 454,271
COST OF REVENUES 80,708 (2,046) 78,662 73,485 (1,917) 71,568
GROSS PROFIT 411,340 2,046 413,386 380,786 1,917 382,703
OPERATING EXPENSES:
Research and development 13,410 (2,652) 10,758 12,425 (3,166) 9,259
Sales and marketing 193,042 (17,167) 175,875 160,576 (17,302) 143,274
General and administrative 9,228 (1,735) 7,493 9,931 (2,067) 7,864
TOTAL OPERATING 215,680 (21,554) 194,126 182,932 (22,535) 160,397
EXPENSES
INCOME FROM OPERATIONS 195,660 23,600 219,260 197,854 24,452 222,306
Finance income, net 21,607 21,607 3,612 3,612
INCOME BEFORE TAXES 217,267 23,600 240,867 201,466 24,452 225,918
INCOME TAXES (TAX BENEFIT) 19,348 19,348 39,946 (21,514) 18,432
NET INCOME 197,919 23,600 221,519 161,520 24,452 21,514 207,486
NET INCOME PER
SHARE:
Basic 2.37 2.65 1.96 2.52
Diluted 2.30 2.57 1.89 2.42
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING USED IN COMPUTATION OF NET INCOME PER SHARE (in thousands)
Basic 83,534 83,534 82,482 82,482
Diluted 85,954 86,177 85,404 85,628
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SOURCE InMode LTD
