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Axonics Reports Fourth Quarter and Fiscal Year 2022 Financial Results

Generated record quarterly revenue of $86 million, an increase of 62% y/y

Reported fiscal year 2022 revenue of $274 million, an increase of 52% y/y

Reiterated fiscal year 2023 revenue guidance of $342 million, an increase of 25% y/y

Axonics, Inc. (Nasdaq: AXNX), a global medical technology company that is developing and commercializing novel products for the treatment of bladder and bowel dysfunction, today reported financial results for the three months and fiscal year ended December 31, 2022.

“This quarter’s record results reflect the growing demand for our best-in-class incontinence products,” said Raymond W. Cohen, chief executive officer of Axonics. “Our U.S. commercial team is continuing to take advantage of increased patient awareness and the overwhelmingly positive physician response to the Axonics F15™ recharge-free sacral neuromodulation system while leveraging cross selling opportunities with Bulkamid®. Our unique hydrogel generated another record revenue quarter and during 2022, Bulkamid was used to treat over 50,000 women with stress urinary incontinence.”

Cohen continued, “In addition to strong commercial execution, we are encouraged by the measurable operating leverage in our business which produced adjusted EBITDA of $10 million in the quarter. We continue to make progress on several key initiatives, including our direct-to-consumer advertising campaign, expansion of our in-house manufacturing capabilities that has benefited gross margin, and the recent FDA approval of the Axonics R20™, our fourth-generation rechargeable sacral neuromodulation system. We remain confident that our commitment to innovation, quality and providing physicians and patients strong clinical support will continue to drive market expansion and advance Axonics on its path to incontinence market leadership.”

Fourth Quarter 2022 Financial Results

  • Net revenue was $85.9 million in fourth quarter 2022, an increase of 62% compared to the prior year period.
    • Sacral neuromodulation revenue was $70.3 million, of which $69.1 million was generated in the U.S. and the remainder in international markets.
    • Bulkamid revenue was $15.6 million, of which $12.3 million was generated in the U.S. and the remainder in international markets.
  • Gross margin was 73.3% in fourth quarter 2022 compared to 66.6% in the prior year period.
  • Operating expenses were $66.6 million in fourth quarter 2022 and included a $2.1 million non-cash charge for the change in fair value of contingent consideration related to the Bulkamid acquisition. Operating expenses were $53.1 million in the prior year period.
    • Excluding acquisition-related charges, adjusted operating expenses were $64.5 million in fourth quarter 2022 and $51.6 million in the prior year period.
  • Adjusted EBITDA was $10.1 million in fourth quarter 2022 compared to an adjusted EBITDA loss of $6.7 million in the prior year period.
  • Net income was $0.7 million in fourth quarter 2022 compared to a net loss of $15.2 million in the prior year period.
    • Net income in fourth quarter 2022 benefited from $3.8 million of interest and other income, net.
  • Cash, cash equivalents and short-term investments were $357 million as of December 31, 2022.

Fiscal Year 2022 Financial Results

  • Net revenue was $273.7 million in fiscal year 2022, an increase of 52% compared to the prior year.
    • SNM revenue was $222.0 million, of which $216.9 million was generated in the U.S. and the remainder in international markets.
    • Bulkamid revenue was $51.7 million, of which $40.2 million was generated in the U.S. and the remainder in international markets.
  • Gross margin was 72.2% in fiscal year 2022 compared to 64.2% in the prior year.
  • Operating expenses were $262.6 million in fiscal year 2022 and included $22.6 million of non-cash charges for the change in fair value of contingent consideration related to the Bulkamid acquisition. Operating expenses were $187.5 million in the prior year.
    • Excluding acquisition-related charges, adjusted operating expenses were $240.1 million in fiscal year 2022 and $180.4 million in the prior year.
  • Adjusted EBITDA was $1.6 million in fiscal year 2022 compared to an adjusted EBITDA loss of $30.4 million in the prior year.
  • Net loss was $59.7 million in fiscal year 2022 compared to net loss of $80.1 million in the prior year.

Fiscal Year 2023 Revenue Guidance

Axonics is reiterating its previously announced fiscal year 2023 revenue guidance of $342 million, which is based on sacral neuromodulation and Bulkamid revenue each growing 25% compared to fiscal year 2022.

  • Sacral neuromodulation revenue of $277.5 million.
  • Bulkamid revenue of $64.5 million.

Webcast and Conference Call

Axonics will host a conference call today at 4:30 p.m. Eastern Time to discuss financial results and recent business developments. Interested parties may join the conference call by telephone by registering at the following link: Axonics 4Q22 registration. After registering, a confirmation email will be sent that includes the dial-in number and unique access code required to join the conference call by telephone.

For those not planning to ask a question on the conference call, the company recommends joining the live webcast, which can be accessed by visiting the following link: Axonics 4Q22 webcast. A replay of the webcast will be archived in the Events section of the Axonics investor relations website.

About Axonics®

Axonics is a global medical technology company that is developing and commercializing novel products for adults with bladder and bowel dysfunction. Axonics recently ranked No. 1 on the 2022 Financial Times ranking of the 500 fastest growing companies in the Americas and No. 4 on the 2022 Deloitte Technology Fast 500™ following its No. 1 ranking in 2021.

Axonics sacral neuromodulation systems provide adults with overactive bladder and/or fecal incontinence with long-lived, easy to use, safe, clinically effective therapy. In addition, the company’s best-in-class urethral bulking hydrogel, Bulkamid®, provides safe and durable symptom relief to women with stress urinary incontinence. In the U.S., moderate to severe urinary incontinence affects an estimated 28 million women and fecal incontinence affects an estimated 19 million adults. Axonics’ clinically proven products are offered at hundreds of medical centers across the U.S. and abroad. Reimbursement coverage is well established in the U.S. and is a covered service in most European countries. For more information, visit www.axonics.com.

Forward-Looking Statements

Statements made in this press release that relate to future plans, events, prospects or performance are forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995. Words such as “plans,” “expects,” “believes,” “anticipates,” “designs,” and similar words are intended to identify forward-looking statements. While these forward-looking statements are based on the current expectations and beliefs of management, such forward-looking statements are subject to a number of risks, uncertainties, assumptions and other factors that could cause actual results to differ materially from the expectations expressed in this press release, including the risks and uncertainties disclosed in Axonics filings with the Securities and Exchange Commission, all of which are available online at www.sec.gov. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Except as required by law, Axonics undertakes no obligation to update or revise any forward-looking statements to reflect new information, changed circumstances or unanticipated events.

Use of Non-GAAP Financial Measures

To supplement Axonics’ consolidated financial statements prepared in accordance with generally accepted accounting principles (GAAP), Axonics provides certain non-GAAP financial measures in this release as supplemental financial metrics.

Adjusted EBITDA is calculated as net income (loss) before other income/expense (including interest), income tax expense (benefit), depreciation and amortization expense, stock-based compensation expense, acquisition-related costs, loss on disposal of property and equipment, and expense related to impairment of intangible assets. Management believes that in order to properly understand short-term and long-term financial trends, investors may want to consider the impact of these excluded items in addition to GAAP measures. The excluded items vary in frequency and/or impact on our results of operations and management believes that the excluded items are typically not reflective of our ongoing core business operations and financial condition. Further, management uses adjusted EBITDA for both strategic and annual operating planning. A reconciliation of adjusted EBITDA reported in this release to the most comparable GAAP measure for the respective periods appears in the table captioned “Reconciliation of GAAP Net Income (Loss) to Adjusted EBITDA” later in this release.

The non-GAAP financial measures used by Axonics may not be the same or calculated in the same manner as those used and calculated by other companies. Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as a substitute for Axonics’ financial results prepared and reported in accordance with GAAP. We urge investors to review the reconciliation of these non-GAAP financial measures to the comparable GAAP financial measures included in this press release, and not to rely on any single financial measure to evaluate our business.

Axonics, Inc.

Consolidated Balance Sheets

(in thousands, except share and per share data)

 

 

December 31,

 

 

2022

 

 

 

2021

 

 

(unaudited)

 

 

ASSETS

 

 

 

Current assets

 

 

 

Cash and cash equivalents

$

238,846

 

 

$

220,878

 

Short-term investments

 

118,365

 

 

 

 

Accounts receivable, net of allowance for credit losses of $321 and $355 at December 31, 2022 and 2021, respectively

 

44,817

 

 

 

29,044

 

Inventory, net

 

55,765

 

 

 

64,946

 

Prepaid expenses and other current assets

 

7,282

 

 

 

6,449

 

Total current assets

 

465,075

 

 

 

321,317

 

Property and equipment, net

 

6,798

 

 

 

6,915

 

Intangible assets, net

 

86,253

 

 

 

106,469

 

Other assets

 

6,813

 

 

 

7,734

 

Goodwill

 

94,414

 

 

 

105,510

 

Total assets

$

659,353

 

 

$

547,945

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

Current liabilities

 

 

 

Accounts payable

$

9,070

 

 

$

7,654

 

Accrued liabilities

 

6,520

 

 

 

5,435

 

Accrued compensation and benefits

 

15,495

 

 

 

12,413

 

Operating lease liability, current portion

 

1,562

 

 

 

1,366

 

Other current liabilities

 

32,600

 

 

 

 

Total current liabilities

 

65,247

 

 

 

26,868

 

Operating lease liability, net of current portion

 

7,555

 

 

 

9,052

 

Deferred tax liabilities, net

 

16,412

 

 

 

19,217

 

Other long-term liabilities

 

 

 

 

10,370

 

Total liabilities

 

89,214

 

 

 

65,507

 

Stockholders’ equity

 

 

 

Preferred stock, par value $0.0001 per share; 10,000,000 shares authorized, no shares issued and outstanding at December 31, 2022 and 2021

 

 

 

 

 

Common stock, par value $0.0001 per share, 75,000,000 and 50,000,000 shares authorized at December 31, 2022 and 2021, respectively; 49,546,727 and 46,330,167 shares issued and outstanding at December 31, 2022 and 2021, respectively

 

5

 

 

 

5

 

Additional paid-in capital

 

969,545

 

 

 

803,559

 

Accumulated deficit

 

(374,264

)

 

 

(314,566

)

Accumulated other comprehensive loss

 

(25,147

)

 

 

(6,560

)

Total stockholders’ equity

 

570,139

 

 

 

482,438

 

Total liabilities and stockholders’ equity

$

659,353

 

 

$

547,945

 

Axonics, Inc.

Consolidated Statements of Comprehensive Income (Loss)

(in thousands, except share and per share data)

 

 

Three Months Ended December 31,

 

Years Ended December 31,

 

 

2022

 

 

 

2021

 

 

 

2022

 

 

 

2021

 

 

(unaudited)

 

(unaudited)

 

(unaudited)

 

 

Net revenue

$

85,918

 

 

$

53,135

 

 

$

273,702

 

 

$

180,290

 

Cost of goods sold

 

22,951

 

 

 

17,744

 

 

 

76,037

 

 

 

64,572

 

Gross profit

 

62,967

 

 

 

35,391

 

 

 

197,665

 

 

 

115,718

 

Operating expenses

 

 

 

 

 

 

 

Research and development

 

8,103

 

 

 

10,182

 

 

 

34,410

 

 

 

37,297

 

General and administrative

 

10,264

 

 

 

7,937

 

 

 

40,238

 

 

 

30,041

 

Sales and marketing

 

43,824

 

 

 

31,338

 

 

 

156,019

 

 

 

105,789

 

Amortization of intangible assets

 

2,271

 

 

 

2,147

 

 

 

9,383

 

 

 

7,241

 

Acquisition-related costs

 

2,114

 

 

 

1,467

 

 

 

22,561

 

 

 

7,158

 

Total operating expenses

 

66,576

 

 

 

53,071

 

 

 

262,611

 

 

 

187,526

 

Loss from operations

 

(3,609

)

 

 

(17,680

)

 

 

(64,946

)

 

 

(71,808

)

Other income (expense)

 

 

 

 

 

 

 

Interest and other income

 

3,229

 

 

 

16

 

 

 

5,133

 

 

 

40

 

Loss on disposal of property and equipment

 

(69

)

 

 

(91

)

 

 

(69

)

 

 

(91

)

Interest and other expense

 

592

 

 

 

102

 

 

 

(2,434

)

 

 

(7,426

)

Other income (expense), net

 

3,752

 

 

 

27

 

 

 

2,630

 

 

 

(7,477

)

Income (loss) before income tax (benefit) expense

 

143

 

 

 

(17,653

)

 

 

(62,316

)

 

 

(79,285

)

Income tax (benefit) expense

 

(522

)

 

 

(2,487

)

 

 

(2,618

)

 

 

782

 

Net income (loss)

 

665

 

 

 

(15,166

)

 

 

(59,698

)

 

 

(80,067

)

Foreign currency translation adjustment

 

11,038

 

 

 

352

 

 

 

(18,587

)

 

 

(6,129

)

Comprehensive income (loss)

$

11,703

 

 

$

(14,814

)

 

$

(78,285

)

 

$

(86,196

)

 

 

 

 

 

 

 

 

Net income (loss) per share, basic

$

0.01

 

 

$

(0.29

)

 

$

(1.28

)

 

$

(1.86

)

Weighted-average shares used to compute basic net income (loss) per share

 

48,166,003

 

 

 

38,971,859

 

 

 

46,684,478

 

 

 

43,072,298

 

Net income (loss) per share, diluted

$

0.01

 

 

$

(0.29

)

 

$

(1.28

)

 

$

(1.86

)

Weighted-average shares used to compute basic net income (loss) per share

 

50,460,039

 

 

 

38,971,859

 

 

 

46,684,478

 

 

 

43,072,298

 

Axonics, Inc.

Net Revenue by Product and Region

(in thousands)

 

 

Three Months Ended December 31,

 

Years Ended December 31,

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

(unaudited)

 

(unaudited)

 

(unaudited)

 

 

SNM

 

 

 

 

 

 

 

United States

$

69,068

 

$

43,702

 

$

216,861

 

$

153,837

International

 

1,236

 

 

722

 

 

5,130

 

 

3,753

SNM total

$

70,304

 

$

44,424

 

$

221,991

 

$

157,590

 

 

 

 

 

 

 

 

Bulkamid

 

 

 

 

 

 

 

United States

$

12,341

 

$

5,790

 

$

40,178

 

$

12,660

International

 

3,273

 

 

2,921

 

 

11,533

 

 

10,040

Bulkamid total

$

15,614

 

$

8,711

 

$

51,711

 

$

22,700

Total net revenue

$

85,918

 

$

53,135

 

$

273,702

 

$

180,290

Axonics, Inc.

Reconciliation of GAAP Net Income (Loss) to Adjusted EBITDA

(unaudited)

(in thousands)

 

 

Three Months Ended December 31,

 

Years Ended December 31,

 

 

2022

 

 

 

2021

 

 

 

2022

 

 

 

2021

 

GAAP Net income (loss)

$

665

 

 

$

(15,166

)

 

$

(59,698

)

 

$

(80,067

)

Non-GAAP Adjustments:

 

 

 

 

 

 

 

Interest and other income

 

(3,229

)

 

 

(16

)

 

 

(5,133

)

 

 

(40

)

Interest and other expense

 

(592

)

 

 

(102

)

 

 

2,434

 

 

 

7,426

 

Income tax (benefit) expense

 

(522

)

 

 

(2,487

)

 

 

(2,618

)

 

 

782

 

Depreciation and amortization expense

 

2,880

 

 

 

2,643

 

 

 

11,721

 

 

 

9,126

 

Stock-based compensation expense

 

8,757

 

 

 

6,844

 

 

 

32,018

 

 

 

25,164

 

Acquisition-related costs

 

2,114

 

 

 

1,467

 

 

 

22,561

 

 

 

7,158

 

Loss on disposal of property and equipment

 

69

 

 

 

91

 

 

 

69

 

 

 

91

 

Impairment expense

 

 

 

 

 

 

 

287

 

 

 

 

Adjusted EBITDA

$

10,142

 

 

$

(6,726

)

 

$

1,641

 

 

$

(30,360

)

 

"We remain confident that our commitment to innovation, quality and providing physicians and patients strong clinical support will continue to drive market expansion and advance Axonics on its path to incontinence market leadership."

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