TransEnterix (NYSE:TRXC) narrowed its losses during its first quarter amid a major strategy shift — but the COVID-19 pandemic is expected to have a negative impact on the robot-assisted surgery developer’s results.
The Research Triangle Park, N.C.-based company said in a news release that it implemented fourth-quarter restructuring that reduced its workforce by approximately two-fifths prior to the impact of the COVID-19 pandemic. According to the company’s annual report filing, it employed 163 total people as of Dec. 31, 2019, with 160 full-time employees.
TransEnterix officials believe that the restructuring and the initiatives implemented in response to COVID-19 have reduced its anticipated cash burn for 2020 by approximately 35% — allowing it to have enough money to meet cash needs into the fourth quarter. However, it believes the pandemic will continue to negatively impact its business and is withdrawing its guidance of $3 million to $3.2 million in revenues for the full year.
TransEnterix posted losses of -$16.6 million, or -59¢ per share, on revenues of $600,000 for the three months ended March 31, 2020, for a bottom-line gain of 26.3% on a sales decline of -72.5%.
Adjusted losses per share came in at -41¢, 12¢ ahead of Wall Street, where analysts were looking for sales of $1.28 million.
The company announced in March that it had received FDA 510(k) clearance to add an artificial intelligence feature to its Senhance robotic surgery system — which boasts haptic feedback, surgeon camera control via eye sensing and improved ergonomics. On top of the push into augmented intelligence, TransEnterix has also been experimenting with robot leasing agreements to get Senhance into the hands of more surgeons.
“During the first two months of 2020, we generated significant momentum with the successful execution of our strategy that we first announced in November 2019. While we have seen some headwinds as a result of COVID, we believe we are well-positioned to continue to deliver on our strategy and bring transformative technology to surgeons, hospitals, and patients globally,” TransEnterix president & CEO Anthony Fernando said in the release.
Shares of TRXC were down -11.2% at 41¢ per share in midday trading today. MassDevice’s MedTech 100 Index — which includes stocks of the world’s largest medical device companies — was down -0.7%.