InMode Reports Third Quarter 2022 Financial Results; Record Quarterly Revenue of $121.2 M, Represents 29% Year-Over-Year Growth

YOKNEAM, Israel, Oct. 27, 2022 /PRNewswire/ -- InMode Ltd. (Nasdaq: INMD) ("InMode"), a leading global provider of innovative medical technologies, today announced its consolidated financial results for the third quarter ended September 30, 2022.

Third Quarter 2022 Highlights:

• Record quarterly revenue of $121.2 million, an increase of 29% compared to the third quarter of 2021: InMode's proprietary surgical technology platforms engaged in minimally invasive and subdermal ablative treatments represented 82% of quarterly revenues, while 11% came from InMode's hands-free platforms and 7% from InMode's traditional laser and non-invasive RF platforms.
• GAAP net income of $48.8 million, compared to $44.7 million in the third quarter of 2021; Record *non-GAAP net income of $56.6 million, compared to $47.9 million in the third quarter of 2021.
• GAAP diluted earnings per share of $0.58, compared to $0.52 in the third quarter of 2021; Record *non-GAAP diluted earnings per share of $0.66, compared to $0.55 in the third quarter of 2021.
• Quarterly revenues from consumables and service of $13.9 million, an increase of 53% compared to the third quarter of 2021.
• Total cash position of $486.4 million as of September 30, 2022, including cash and cash equivalents, marketable securities, and short-term bank deposits.

*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 financial results exclude share-based compensation adjustments.

Management Comments

"Once again, we reported a record quarter with 29% top line growth and high profitability. Demand has remained strong despite the anticipated seasonality and the return of summer travel, and this positive momentum continues into Q4. We're very happy with the successful market endorsement of our strategy as we expand from aesthetics into wellness and improved quality of life categories. We started with the EmpowerRF and we will continue with other categories such as ophthalmology, ENT and others. The EmpowerRF platform for women's health has exceeded our optimistic expectations, which leads us to increase its revenue target yet again by 33% to $40 million for this year. In addition, we will continue to expand globally and plan on opening two new subsidiaries in Asia and Europe by mid 2023," said Moshe, Mizrahy, Chairman and Chief Executive Officer.

Shakil Lakhani, President of InMode North America, commented on the financial results: "Our performance in North America continues to be the major growth engine for the company, with an emphasis on the Morpheus 8 becoming one of the most popular minimally invasive procedures. We've continued to invest in increasing our brand awareness, including adding Eva Longoria as our new brand ambassador, which is another sign of our commitment to customers and to positive consumer perception." 

"We've seen growing adoption of our EmpowerRF platform by an increased number of women's health and wellness physicians across the U.S. and Canada. The success in improving women's quality of life is meaningful to InMode, and we intend building on its momentum as we capture more share in this important market", said Dr. Spero Theodorou, Chief Medical Officer.

Third Quarter 2022 Financial Results

Total revenues for the third quarter of 2022 reached $121.2 million, an increase of 29% compared to the third quarter of 2021.

"Sales of disposables continued to grow year over year and contributed more to the revenue mix, as our platforms are being used more frequently by our customers. Additionally, we successfully increased our gross margins back to the 85% target range," said Yair Malca, Chief Financial Officer.

GAAP gross margin for the third quarter of 2022 was 85%, like in the third quarter of 2021. *Non-GAAP gross margin for the third quarter of 2022 was 85% and 86% for the third quarter of 2021.

GAAP operating margin for the third quarter of 2022 was 44%, compared to a gross operating margin of 48% in the third quarter of 2021. *Non-GAAP operating margin for the third quarter of 2022 and for the third quarter of 2021 was 51%. The decrease in GAAP operating margin is primarily attributable to change in share-based compensation expense.

InMode reported GAAP net income of $48.8 million, or $0.58 per diluted share, in the third quarter of 2022, compared to $44.7 million, or $0.52 per diluted share, in the third quarter of 2021. On a *non-GAAP basis, InMode reported net income of $56.6 million, or $0.66 per diluted share, in the third quarter of 2022, compared to $47.9 million, or $0.55 per diluted share, in the third quarter of 2021.

2022 Financial Outlook

Management provided an outlook for the full year of 2022, ending Dec. 31, 2022. Based on current estimates, management expects:

• Revenue between $445 million and $450 million
• *Non-GAAP gross margin between 83% and 85%
• *Non-GAAP income from operations between $214 million and $217 million
• *Non-GAAP earnings per diluted share between $2.28 and $2.30

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 financial results exclude share-based compensation adjustments.

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, Oct. 27, 2022, at 8:30 a.m. Eastern Time to discuss the third quarter 2022 financial results.

The Company encourages participants to pre-register for the conference call using the following link: 

https://dpregister.com/sreg/10171927/f4b117e67a

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 that 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=pOSyfnXi

At:
8:30 a.m. Eastern Time
5:30 a.m. Pacific Time
3:30 p.m. Israel 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 October 27, 2022, at 12 p.m. Eastern Time to November 02, 2022, 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: 8851334

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://inmodemd.com/investors/.

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 future performance described above under the heading titled "2021 Financial Outlook." 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, including with respect to the impact of the COVID-19 global outbreak. 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 10, 2022, as well as risk factors relating to the COVID-19 global outbreak 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.

INMODE LTD.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(U.S. dollars in thousands, except for per share data)
(Unaudited)

INMODE LTD.
CONDENSED CONSOLIDATED BALANCE SHEETS
(U.S. dollars in thousands, except for per share data)
(Unaudited)

INMODE LTD.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(U.S. dollars in thousands, except for per share data)
(Unaudited)

INMODE LTD.
CONDENSED CONSOLIDATED FINANCIAL HIGHLIGHTS
(U.S. dollars in thousands, except for per share data)
(Unaudited)

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)

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)

Company Contact:
Yair MalcaChief
Financial Officer
Phone: (949) 305-0108
Email: [email protected]

Investor Relations Contact:
Miri Segal
MS-IR LLC
Phone: (917) 607-8654
Email: [email protected]

SOURCE InMode Ltd.

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