Shares in Align Technology (NSDQ:ALGN) rose today after the dental-focused device maker posted Street-beating Q1 earnings alongside a number of other updates, including a clearance from China’s FDA, an update on a legal spat with SmileDirectClub and multiple product launches.
The San Jose, Calif.-based company posted profits of $95.9 million, or $1.17 per share, on sales of $436.9 million for the three months ended March 31, for bottom-line growth of 38.1% while sales grew 40.8% compared with the same period last year.
Align Technology’s earnings per share were ahead of the 98¢ consensus on Wall Street, where analysts expected too see sales of $408.3 million, which the company handily topped.
“I’m pleased to report better than expected first quarter results and a strong start to the year for Align, with revenues, volumes and EPS above our guidance. Record Q1 revenues were up 41% year-over-year reflecting continued strong Invisalign volume across all geographies and customer channels, as well as iTero scanner sales which were up 84% year-over-year. Q1 Invisalign volume growth of 31% year-over-year was driven by increased utilization including strong teen case growth globally, and expansion of our customer base, which included over 4,200 new Invisalign-trained doctors worldwide,” prez & CEO Joe Hogan said in a prepared statement.
Align Tech provided updated guidance for its next quarter, expecting to see sales of between $460 million and $470 million, with EPS of between $1.02 and $1.06.
In a separate release, Align said it won Chinese FDA approval for its iTero Element intraoral scanner.
“The market opportunity in China is huge and it remains the single largest country market for Align outside of the United States. The Chinese intraoral scanner market is less than two percent penetrated today and is expected to grow 6X by 2020. Not only does the iTero Element scanner launch support the growth of our base Invisalign clear aligner business, but it also represents a major milestone for digital dentistry in China. We’re glad to take a leadership role bringing the latest and most advanced intraoral scanning technologies to the region,” Align Asia Pacific managing director Julie Tay said in a press release.
The company updated on a legal spat in which SmileDirectClub alleged that Align Tech’s opening of pilot Invisalign stores breached non-compete provisions in late February.
Align said that this month, SDC and its associated entities now seek to preliminarily and permanently enjoin activities related to the pilot store project, including requiring Align to close all existing stores and prohibit any new stores from opening.
SDC also wishes to be allowed to repurchase all of Align’s SDC Financial membership interests for a purchase price equal to Align’s current capital account balance, the company said in a press release. Align Technology said it is disputing the alligations, and will oppose and vigorously defend itself in the case.
In two other updates, the company announced the launch of a new Invisalign Go product and two new iTero scanners, the iTero Element and iTero Element 2 systems.
“Invisalign Go’s new visualization feature of multiple treatment plans is absolutely invaluable from a clinician’s point of view because it helps to explain different treatment options and choose the treatment plan that best meets the patient’s preferences. It’s a great way to communicate with a patient and it brings so much excitement. It’s one of the best new advances with the product,” Dr. Affan Saghir of Yorkshire, England, who provides Invisalign Go products said in a press release.
“We’re excited to expand the iTero portfolio with two new advanced digital scanners that expand customers’ choices and provide them with the imaging precision, intuitive chairside visualization and patient communication tools that enable efficient workflows for a full range of case assessment and restorative and orthodontic treatment. With iTero Element 2 and iTero Element Flex, we are building on a trusted platform with enhanced features and processing performance, new mobility options and greater portability designed to fit the needs of our customers’ practices and simplify their lives. Doctors can now choose the iTero Element scanner that is best for them with confidence knowing that each solution is going to deliver the precision, power, speed, and full-color imaging they’ve come to expect for their iTero-powered workflows,” Align Tech chief marketing, portfolio and biz dev officer Raphael Pascaud said in a prepared statement.
Shares in Align Technology have risen 2.7% so far today, at $252.15 as of 10:18 a.m. EDT.