Mazor Robotics reported $13.2 million in second quarter revenue, down from the same period last year.
Here are five things to know:
1. Mazor's year-over-year quarterly revenue declined 14.8 percent from $15.5 million last year to $13.2 million this year. In the U.S., revenue hit $11.8 million, down from $14.1 million during the second quarter of 2017. The company attributed its revenue decline to the lower pricing terms under its distribution agreement with Medtronic compared to a year ago, in which the company reported mostly direct sales.
"As we previously disclosed, 2018 is a transition year for the company following the late 2017 move from direct sales of the Mazor X System to a distribution model with Medtronic," said CEO Ori Hadomi. "The expected larger unit volumes, offset by the transfer pricing, is designed to accelerate the adoption of our systems by extending our market reach and expanding our geographical presence. The faster growth of our installed base will also accelerate our recurring revenue business, which represented 48 percent of our Q2 revenues."
2. International revenue was flat at $1.4 million, and recurring revenue from kit sales, services and other was $6.3 million.
3. Operating loss was flat at $3.9 million when compared to the second quarter of 2017, and net loss jumped from $3.7 million to $3.8 million in 2018. Mazor reported gross margin for the quarter at 56.1 percent, down from 69.4 percent a year ago.
4. At the six months end, Mazor reported a 6 percent increase in revenue, which reached $28.7 million, driven by higher recurring revenue but offset by a decrease in revenue from existing sales. Net loss for the six months end was $5.1 million, down from $8.9 million for the first half of 2017.
5. During the quarter, several academic medical centers and hospitals adopted the Mazor X, which Mr. Hadomi mentioned brings the company closer to achieving its objective of placing "hundreds of Mazor X systems" over the next few years.
"Later this year, Mazor and Medtronic are anticipating a market-changing event with the introduction of the Mazor X Stealth Edition system integrating Medtronic's legacy Stealth navigation system with the Mazor X platform," Mr. Hadomi said. "Given the binding purchase commitments received to date, and to ensure rapid system and upgrade delivery, we are implementing production capacity increases at our Israel facilities."
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