Israeli surgical robotics firm Mazor Robotics yesterday reported promising financial results despite a net loss for second-quarter 2013, which ended June 30. According to CEO Ori Hadomi, “Our strong financial performance, highlighted by the revenue increase and gross margin expansion, demonstrates continued global adoption of our Renaissance systems as we ended the second quarter with 54 systems installed globally.”
Q2 revenue was $6.2 million, up from $2.9 million in Q2 2012, though the company’s year-on-year quarterly net loss increased from $1.1 million in 2012 to $4.4 million this year. Despite the increased losses, however, Mazor beat Wall Street estimates on revenue, which led to an immediate uptick in stock prices.
This revenue expansion, continuing a trend visible in the firm’s Q1 report, is attributed primarily to a year-on-year increase in U.S. revenue of 77 percent thanks to the sale of five systems (following the same sales count in Q1, as compared to three in Q2 2012), a number which includes the firm’s first U.S. follow-on order. These numbers are being interpreted as suggestive of the potential for significant ongoing U.S. growth accompanied by additional signs of “early success in AsiaPacific, including India, Vietnam, Taiwan and Australia,” with international non-U.S. revenues leaping to $1.8 million this quarter from $0.4 million the previous year. Operating losses have been attributed to large investments in sales, marketing resources, and ongoing “net financing expenses … attributed to the revaluation of the fair value of the derivative instruments granted as part of the Company’s investment agreement with Oracle Investment Management Group,” as with the company’s even larger net loss in Q1.
The market leader in surgical robotics remains Intuitive Surgical, maker of the da Vinci surgical system, which in mid-July reported Q2 revenue of $579 million with a net profit of $159 million. While this represented a year-on-year increase of 8 percent revenue, it was only a 4 percent profit jump, and a significant decline from Q1’s revenue of $611 million and net income of $189 million. This dip in Intuitive’s forward progress is likely related to the majority of Q2 occurring under the shadow of a lawsuit over a patient death following prostrate surgery, which was only decided in the robotics firm’s favor on May 23. While Intuitive saw an immediate stock uptick following the verdict, July’s report indicated ongoing investor concern over the company’s fortunes, meaning another fiscal quarter is necessary to assess the longer-term impact of the lawsuit on market confidence, as well as on the surgical robotics industry at large.
[ photo courtesy of Mazor Robotics ]