LENSAR, Inc.

Good morning and thank you for participation. At this time, all participants are in a listen-only mode. Later, we will conduct a question and answer session. As a reminder, this conference call will be recorded. I would now like to turn the call over to Cameron Radinovic of Burns McClellan. Mr. Radinovic, please go ahead.

Thank you, Operator. Good morning and welcome to the LENZAR 3rd Quarter 2024 Financial Results Conference Call. Earlier this morning, the company issued a press release providing an overview of its financial results for the quarter ended September 30, 2024. This press release is available on the investor relations section of the company's website at www.lenzart.com. Joining me on the call today is Nick Curtis, Chief Executive Officer, who will review the company's recent business and operational progress. Following his comments, Tom Staub, Chief Financial Officer, will provide an overview of the company's financial highlights before turning the call back over to the operator to facilitate answering any questions you may have. Today's conference call will contain certain forward-looking statements, including those statements regarding future results, unaudited, and forward-looking financial information, as well as the company's future performance and or achievements. These statements are subject to known and unknown risks and uncertainties, which may cause the company's actual results, performance, or achievements to be materially different from any future results or performance expressed or implied in this presentation. You should not place undue reliance on these forward-looking statements. For additional information, including a detailed discussion of the company's risk factors, please refer to the company's documents filed with the Securities and Exchange Commission which can be accessed on the website. In addition, this conference call contains time-sensitive information that is accurate only as of the date of this live broadcast, November 7, 2024. Lanzar undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this live call. With that, it's my pleasure to turn the call over to Nick Curtis. Nick?

Thank you, Cam, and good morning to everyone. I appreciate you joining us, and I'm excited to report that Lenzar had another record-breaking third quarter. Starting from an ally system placement standpoint, the third quarter was fueled by the recent market expansion to the EU and Taiwan as we placed a total of 24 new ally systems, an outstanding 118% increase over what had been a strong third quarter of 2023 and a 41% increase over the second quarter of 2024. This was driven in part by very solid performance outside of the United States, where we sold 11 Ally systems following mid-third quarter regulatory clearances in Europe, Switzerland, and Taiwan. The rapid trajectory and success of the Ally International launch speaks to several key factors. First, the advanced planning and collaboration between our commercial team, and distributor partners in training, field service, and clinical applications, as well as our onsite assistance with first installs allowed for a rapid response after clearance to ship Ally systems. Second, we properly prepared the market, building interest by supporting our partners in attending multiple conferences, meeting with surgeons and performing demos, shared learnings from U.S. launch and clinic experience. worked with our distributor partners on two of the larger PE groups in securing Ally system commitments. Four, facilitated U.S. KOL surgeons using Ally to network and perform presentations in several of the conference venues. And last, I was fortunate enough to have participated in several panel discussions just prior to receiving clearance and shortly thereafter. The ACOS European meeting in Prague, and recently the ESCRS in Barcelona. I'd like to recognize and thank our distributor partners for their close collaboration and commitment in making the initial Ally launch so successful. The strong global interest in Ally is creating a healthy expansion of new to Lensar customer sites, which will result in the continued growth of our recurring revenues. Our total installed base of Ally systems grew to over 100 on a global basis, reflecting a 170% increase from September 30th of last year. Lensar's overall installed base, including the legacy Lensar laser systems, has grown to 355 systems, representing a 20% increase over Q3 2023 and an 8% increase quarter over quarter. In addition to our strong placement activity, we continue to build our pipeline of executed contracts and pending installations. We finished the quarter with a backlog of 24 systems which we expect to install over the next six months. I think it would be beneficial at this juncture to provide you with a little bit of color around backlog, the time from contract to installation, training and revenue recognition in the US and internationally. In the US on average, it takes approximately 50 days from the time of reaching a signed agreement to installation and first surgeon trained. We schedule and perform a site and surgical visit in advance of shipping the Ally in order to determine the right placement and specifications to install Ally, educate us on their current process and flow, their surgeons and site preferences in performing their cataract surgery as well as what a typical surgical day entails. Then we schedule a convenient ship date, provide initial online training as well as an outline on what to expect after installation. On-site training of staff as well as the surgeon is followed by live surgery. We allocate three surgical days with each surgeon, performing a minimum of five cases each day, utilizing all the features of Ally to certify the staff and surgeon. At this time, we recognize a revenue on the system. Only then, all personnel that work with the device need to be certified for use. All surgeons must perform a minimum of 15 cases. If a system has fully executed contract but is not installed in the quarter the agreement is signed, it becomes a backlog system. This backlog is dependent on the steps I just described, as well as any unique installation requirements, such as an electrical modification, or the room is under construction, or they have a competitive system to be removed, or waiting for a contract expiration, etc. The backlog could take some time, and despite the customer commitment, remains in a state of flow. Outside the U.S., revenue recognition for Lensar is very different. Outside the US, our distributor partners are responsible for the installation and training. However, when the ally leaves Lensar's dock, the system becomes the property of the distributor and we recognize the system revenue. However, it still takes approximately 60 to 90 days after installation for the site and surgeon to begin to get to a normalized run rate. In the bigger picture, it is important to understand the process and thus why there is a rolling or staggered effect on procedure growth and revenue recognition over time. This is a primary driver as to why our quarterly placements can be lumpy and uneven. Timing with the number of activities can be dependent on many factors. Again, previously we discussed a large PE group deal that had been executed just after the close of a quarter. This is a game of inches. and we're gaining each quarter in the important areas of increasing recurring revenues through procedures and market share gains and footprint. We achieved $13.5 million of revenue in the third quarter, an increase of over 38% from the third quarter of last year, which, as I just described, was attributable to robust growth in system placements, including 11 OUS system sales. Turning to procedures, We had another quarter of strong growth with procedure volumes increasing 29% over the third quarter of 2023 and US procedures increasing 22% year over year. We expect this trend to continue moving forward as utilization on newly placed systems ramps up, particularly with users who are new to Lensar having converted to Ally from older competing lasers. On average, we see approximately a 13% increase on a Lensar LLS moving to Ally, and the new to Lensar Allies are net 100% new recurring revenue procedures from the start. The more systems we install, the more procedure revenue will begin to grow. We're really focused on expanding our footprint and placements by first converting competitive systems, followed by transitioning current Lensar LLS users to Ally, Third is adding second or multiple systems with high volume, high conversion rate sites and surgeons, as well as additional site expansions. And finally, what we refer to as cataract laser naive accounts, which continue to grow the overall entire market. According to a recent market scope estimate, our share of the U.S. procedure market increased to approximately 20% as of September 30th. This is a really healthy increase of 1.5% over the second quarter. But more impressively, we have gained 3.5% market share in the past year and nearly 6% since launching Ally in the summer of 2022. The U.S. is the largest premium cataract market in the world, and even though we're competing directly against the largest ophthalmology companies in the world, we have succeeded in achieving significant market share growth and securing 20% of the U.S. procedure market. At LensArt, we're incredibly proud of this achievement, and most importantly, it demonstrates U.S. surgeons' recognition of the technology advancement in providing better patient outcomes, increased efficiencies in throughput and flow, and financial efficiencies the Ally system provides over the aging competitive lasers from our much larger competitors. With recent approvals, we can strive to add market share outside the United States as we continue to receive Ally clearance in additional countries. Procedure volumes directly correlate to our recurring revenue rate, which we believe is a highly effective, very important measure of our growth and longer-term success. In the third quarter, our recurring revenue totaled approximately $9.9 million, with $38 million in recurring revenue on a trailing 12-month basis through the third quarter of 2024. This is an increase of 22% over the 12 months ended September 30, 2023, and with more than 40 systems placed in the last two quarters alone, we expect recurring revenue to grow in a material way on a rolling forward basis as each of these systems passes 90 days from install date and activity continues to ramp on these newly installed lasers. As I mentioned, we attended several US and OUS congresses, including the ESCRS and AAO, where we performed over 100 ally demonstrations and booth meetings that have resulted in a significant number of new prospects for our US sales team, as well as our partner distributors in the EU and Southeast Asia. Differentiating Ally by demonstrating the robotic intelligence, precision and reproducibility, as well as the significantly enhanced efficiency and workflow are driving the interest. And as they say, a picture says a thousand words. And when they see it, the potential benefits become obvious. To that end, I'm incredibly proud of what the Lenzo team has accomplished this quarter and through the first nine months of 2024. We successfully launched Ally in the EU and Taiwan with an overwhelmingly positive response. This is a testament to the transformative power of Ally and its potential to positively impact the future of robotic cataract surgery. We're starting to benefit from the universal appeal on a broader scale with Ally now available in multiple geographies outside the United States. As we look ahead, Lensar is incredibly well positioned heading into the fourth quarter, which is traditionally our strongest period of the year, and we're setting the stage effectively for continued success in 2025 and beyond. We're very excited about the potential of our pipeline and the ability to further innovate and revolutionize the field of robotic cataract laser surgery. Now let me turn the call over to Tom to cover our financial highlights for the quarter. Tom?