Shockwave Medical Reports Fourth Quarter and Full Year 2023 Financial Results

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SANTA CLARA, Calif., Feb. 15, 2024 (GLOBE NEWSWIRE) -- Shockwave Medical, Inc. (Nasdaq: SWAV), a pioneer in the development and commercialization of transformational technologies for the treatment of cardiovascular disease, today reported financial results for the three months and full year ended December 31, 2023.

Recent Highlights

  • Recognized revenue of $203.0 million for the fourth quarter of 2023 and $730.2 million for the full year 2023, representing increases of 41% and 49%, respectively, from the same periods in 2022
  • Initiated the full U.S. commercial launch of the Shockwave C2+ Coronary Intravascular Lithotripsy (IVL) catheter
  • Granted new physician and hospital reimbursement for coronary IVL in the United States. Three newly created MS-DRGs specific to coronary IVL for hospital payment in the inpatient setting became effective October 1, 2023. A new Category I CPT add-on code that provides physicians with remuneration for the additional work associated with performing coronary IVL became effective January 1, 2024

“The team ended 2023 with solid performances across our business and geographies,” said Doug Godshall, President and Chief Executive Officer of Shockwave Medical. “Our record revenue is a testament to the continued clinical need for our innovative products and our ability to grow the Shockwave organization to meet those needs as we pursue our mission to improve outcomes for patients suffering from cardiovascular disease.”

Fourth Quarter 2023 Financial Results

Revenue for the fourth quarter of 2023 was $203.0 million, an increase of $59.0 million, or 41%, compared to the corresponding prior year period. Revenue growth was primarily driven by increased adoption of Shockwave products in both the United States and internationally.

Gross profit for the fourth quarter of 2023 was $177.7 million compared to $126.5 million for the corresponding prior year period. Gross margin for the fourth quarter of 2023 was 88%, consistent with 88% for the corresponding prior year period.  

Operating expenses for the fourth quarter of 2023 were $134.4 million, compared to $84.1 million for the corresponding prior year period, representing a 60% increase, primarily driven by increases in headcount to support the growth of the business and Reducer spend resulting from the Neovasc acquisition that closed in 2023.  

Net income was $44.3 million in the fourth quarter of 2023, as compared to a net income of $140.9 million in the corresponding prior year period. In the fourth quarter of 2022, we released our valuation allowance, which resulted in a tax benefit of $99.0 million in that quarter. Basic net income per share was $1.20 in the fourth quarter of 2023. Diluted net income per share was $1.16 in the fourth quarter of 2023.

Adjusted EBITDA was $68.2 million in the fourth quarter of 2023, a 20% increase compared to adjusted EBITDA of $56.6 million in the fourth quarter of 2022. Adjusted EBITDA is a non-GAAP measure. For additional information regarding non-GAAP financial measures, see “Use of Non-GAAP Financial Measures” and “Reconciliation of GAAP Net Income to Adjusted EBITDA” below.

Full Year 2023 Financial Results

Revenue for the full year 2023 was $730.2 million, an increase of $240.5 million, or 49%, compared to the full year 2022. The growth was primarily driven by an increase in the purchase volume of our products in the United States and increased adoption of our products internationally.

Gross profit for the full year 2023 was $634.8 million compared to $424.7 million for the full year 2022. Gross margin for the full year 2023 was 87%, consistent with 87% for the full year 2022.

Operating expenses were $475.7 million for the full year 2023, compared to $300.6 million for the full year 2022, an increase of 58% primarily driven by increases in headcount to support the growth of the business and Reducer spend resulting from the Neovasc acquisition that closed in 2023.  

Net income was $147.3 million for the full year 2023, compared to $216.0 million for the full year 2022. Net income in 2022 included a $99.0 million tax benefit from the release of our valuation allowance in that year. Basic net income per share was $4.01 for the full year 2023. Diluted net income per share was $3.85 for the full year 2023.

Adjusted EBITDA was $242.7 million for the full year 2023, a 40% increase compared to adjusted EBITDA of $173.9 million for the full year 2022. Adjusted EBITDA is a non-GAAP measure.

Cash, cash equivalents and short-term investments totaled $990.6 million as of December 31, 2023.

2024 Financial Guidance

Shockwave Medical projects revenue for the full year 2024 to range from $910 million to $930 million, which represents 25% to 27% growth over the full year 2023 revenue.

Conference Call

Shockwave Medical will host a conference call at 1:30 p.m. Pacific Time / 4:30 p.m. Eastern Time on Thursday, February 15, 2024, to discuss its fourth quarter and full year 2023 financial results. The call may be accessed by dialing 877-704-4453 for domestic callers or 201-389-0920 for international callers, using conference ID: 13742096. A live and archived webcast of the event will be available at https://ir.shockwavemedical.com/.

About Shockwave Medical, Inc.

Shockwave Medical is a leader in the development and commercialization of innovative products that are transforming the treatment of cardiovascular disease. Its first-of-its-kind Intravascular Lithotripsy (IVL) technology has transformed the treatment of atherosclerotic cardiovascular disease by safely using sonic pressure waves to disrupt challenging calcified plaque, resulting in significantly improved patient outcomes. Shockwave Medical has also recently acquired the Reducer, which is under clinical investigation in the United States and is CE Marked in the European Union and the United Kingdom. By redistributing blood flow within the heart, the Reducer is designed to provide relief to the millions of patients worldwide suffering from refractory angina. Learn more at www.shockwavemedical.com.

Forward-Looking Statements

This press release contains statements relating to our expectations, projections, beliefs, and prospects, which are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, you can identify these statements by forward-looking words such as “may,” “might,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential” or “continue,” and similar expressions, and the negative of these terms. Forward-looking statements in this press release include, but are not limited to, statements regarding our anticipated future operating results and financial position, including for the full year ending December 31, 2024, our business strategy and plans, our objectives for future operations and financial performance and other matters. You are cautioned not to place undue reliance on these forward-looking statements. Forward-looking statements are only predictions based on our current expectations, estimates, and assumptions, valid only as of the date they are made, and subject to risks and uncertainties, some of which we are not currently aware.

Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others: the impact of global business, political, and macroeconomic conditions, including inflation, rising interest rates, uncertainty with respect to the federal budget and the related potential for government shutdowns, instability in the global banking system, volatile market conditions, supply chain disruptions, cybersecurity events and global events, including regional conflicts around the world, on our operations, financial results, liquidity, capital resources, expenses, supply chain, manufacturing, research and development activities, clinical trials, and employees; our ability to successfully execute our business and growth strategies; our ability to develop, manufacture, obtain and maintain regulatory approvals for, and market and sell, our products; our expected future growth, including the size and growth potential of the markets for our products; our ability to obtain coverage and reimbursement for procedures performed using our products; our ability to scale our organizational culture; the impact of the development, regulatory approval, efficacy and commercialization of competing products; the loss of key scientific or management personnel; our ability to develop and maintain our corporate infrastructure, including our internal controls; our financial performance and capital requirements; the success of any acquisitions that we make; and our ability to obtain and maintain intellectual property protection for our products, as well as our ability to operate our business without infringing the intellectual property rights of others. These factors, as well as others, are discussed in our filings with the Securities and Exchange Commission (SEC), including in the sections titled “Risk Factors” in our most recent Annual Report on Form 10-K and subsequently filed Quarterly Reports on Form 10-Q, and in our other reports filed with the SEC. Except to the extent required by law, we do not undertake to update any of these forward-looking statements after the date hereof to conform these statements to actual results or revised expectations.

Use of Non-GAAP Financial Measures

This press release contains supplemental financial information determined by methods other than in accordance with accounting principles generally accepted in the United States (GAAP), including references to adjusted EBITDA, a non-GAAP financial measure that excludes from net income the effects of income tax (benefit) provision, other income, interest expense, loss from equity method investment, depreciation and amortization, and stock-based compensation expense. We believe the presentation of adjusted EBITDA is useful as it provides visibility to our underlying continuing operating performance by excluding the impact of certain items that are non-cash in nature or not related to our core business operations.

Our definition of adjusted EBITDA may differ from similarly titled measures used by others. Adjusted EBITDA should be considered supplemental to, and not a substitute for, financial information prepared in accordance with GAAP. Because adjusted EBITDA excludes the effect of items that increase or decrease our reported results of operations, management strongly encourages investors to review, when they become available, our consolidated financial statements and publicly filed reports in their entirety. A reconciliation of adjusted EBITDA to net income has been provided in the financial statement tables included in this press release, and investors are encouraged to review the reconciliation.

Media Contact: Scott Shadiow+1.317.432.9210sshadiow@shockwavemedical.com

Investor Contact:Debbie Kasterdkaster@shockwavemedical.com

SHOCKWAVE MEDICAL, INC. 
Balance Sheet Data  
(in thousands)  
      
      
  December 31,2023 December 31,2022 
  (Unaudited)   
ASSETS    
CURRENT ASSETS:     
Cash and cash equivalents $328,422 $156,586  
Short-term investments  662,132  147,907  
Accounts receivable, net  114,552  71,366  
Inventory  107,587  75,112  
Prepaid expenses and other current assets  12,567  8,292  
Total current assets  1,225,260  459,263  
Operating lease right-of-use assets  29,707  32,365  
Property and equipment, net  68,923  48,152  
Equity method investment  1,643  3,512  
Intangible assets, net  92,857    
Goodwill  39,568    
Deferred tax assets  99,169  97,568  
Other assets  9,436  5,229  
TOTAL ASSETS $1,566,563 $646,089  
LIABILITIES AND STOCKHOLDERS’ EQUITY      
CURRENT LIABILITIES:     
Accounts payable $8,868 $6,721  
Accrued liabilities  91,696  55,375  
Lease liability, current portion  3,641  1,278  
Total current liabilities  104,205  63,374  
Lease liability, noncurrent portion  35,103  34,928  
Convertible debt, noncurrent portion  731,863    
Debt, noncurrent portion    24,198  
Related party contract liability, noncurrent portion  12,273  12,273  
Deferred tax liabilities  3,609    
Long-term income tax liability  1,526    
Other liabilities  9,307    
TOTAL LIABILITIES  897,886  134,773  
STOCKHOLDERS’ EQUITY:     
Preferred stock      
Common stock  37  36  
Additional paid-in capital  557,882  548,960  
Accumulated other comprehensive income (loss)  293  (867) 
Retained earnings (accumulated deficit)  110,465  (36,813) 
TOTAL STOCKHOLDERS’ EQUITY  668,677  511,316  
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $1,566,563 $646,089  
 

SHOCKWAVE MEDICAL, INC.
Statement of Operations Data
(Unaudited)
(in thousands, except share and per share data)
       
         
  Three Months Ended Year Ended
  December 31, December 31,
   2023   2022   2023   2022 
Revenue:        
Product revenue $202,979  $144,026  $730,230  $489,733 
Cost of revenue:        
Cost of product revenue  25,316   17,502   95,388   64,996 
Gross profit  177,663   126,524   634,842   424,737 
Operating expenses:        
Research and development  42,321   23,723   145,647   81,679 
Sales and marketing  67,181   43,437   234,837   161,995 
General and administrative  24,879   16,941   95,265   56,929 
Total operating expenses  134,381   84,101   475,749   300,603 
Income from operations  43,282   42,423   159,093   124,134 
Loss from equity method investment  (167)  (1,061)  (1,869)  (2,475)
Interest expense  (2,950)  (969)  (6,905)  (1,886)
Other income, net  15,295   4,261   23,962   1,055 
Net income before taxes  55,460   44,654   174,281   120,828 
Income tax (benefit) provision  11,155   (96,257)  27,003   (95,168)
Net income $44,305  $140,911  $147,278  $215,996 
Net income per share, basic $1.20  $3.89  $4.01  $6.02 
Net income per share, diluted $1.16  $3.71  $3.85  $5.70 
Shares used in computing net income per share, basic  36,930,055   36,178,112   36,706,060   35,900,738 
Shares used in computing net income per share, diluted  38,158,637   37,994,698   38,206,269   37,881,590 
                 

SHOCKWAVE MEDICAL, INC.
Reconciliation of GAAP Net Income to Adjusted EBITDA
(Unaudited)
(in thousands)

  Three Months Ended Year Ended
  December 31, December 31,
   2023   2022   2023   2022 
GAAP Net Income $44,305  $140,911  $147,278  $215,996 
Non-GAAP Adjustments        
Income tax (benefit) provision  11,155   (96,257)  27,003   (95,168)
Other income  (15,295)  (4,261)  (23,962)  (1,055)
Interest expense  2,950   969   6,905   1,886 
Loss from equity method investment  167   1,061   1,869   2,475 
Depreciation and amortization  3,075   1,538   10,358   4,856 
Stock-based compensation expense  21,811   12,643   73,234   44,890 
Adjusted EBITDA $68,168  $56,604  $242,685  $173,880 

 

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Source: Shockwave Medical, Inc.

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