Generated record revenue, gross margin and net income in 2Q24

IRVINE, Calif., August 01, 2024--(BUSINESS WIRE)--Axonics, Inc. (Nasdaq: AXNX), a medical technology company that develops, manufactures and commercializes innovative and minimally invasive products to treat bladder and bowel dysfunction, today reported financial results for the three months ended June 30, 2024.

"Axonics continued to execute at a high level in the second quarter, generating record revenue and setting new high-water marks for gross margin and adjusted EBITDA margin," said Raymond W. Cohen, chief executive officer. "Revenue growth of 23% year over year was driven by higher utilization at existing customers and the onboarding of new accounts. Axonics also generated record net income in the second quarter, a result of gross margin expansion from higher manufacturing yields and continued operating leverage."

Mr. Cohen continued, "We remain confident that our commitment to innovation, quality, direct-to-consumer advertising and providing strong clinical support will continue to expand the sacral neuromodulation market and propel Axonics on its path to market leadership. We look forward to the global impact the Axonics portfolio of life-changing incontinence therapies can make as part of Boston Scientific as we endeavor to treat more patients than ever before."

Second Quarter 2024 Financial Results

Net revenue was $114.6 million, an increase of 23% compared to the prior year period.

Sacral neuromodulation revenue was $91.2 million, an increase of 23% compared to the prior year period. Bulkamid revenue was $23.4 million, an increase of 25% compared to the prior year period. Gross margin was 77.8% compared to 75.6% in the prior year period. Operating expenses were $85.5 million compared to $82.3 million in the prior year period. Net income was $6.9 million compared to a net loss of $7.3 million in the prior year period. Adjusted EBITDA was $23.4 million compared to $18.4 million in the prior year period. Cash, cash equivalents, short-term investments and restricted cash were $362 million as of June 30, 2024.

About Axonics

Axonics is a global medical technology company that is developing and commercializing novel products for adults with bladder and bowel dysfunction. Axonics ranked No. 2 on the 2023 Financial Times ranking of the fastest growing companies in the Americas after being ranked No. 1 in 2022.

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. For more information, visit www.axonics.com.



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 loss before other income/expense (including interest), income tax expense (benefit), depreciation and amortization expense, stock-based compensation expense, acquisition-related costs, cash compensation in lieu of equity compensation due to pending merger, acquired in-process research and development expense, 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 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.

Cautionary Statement Regarding Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words like "may," "will," "likely," "should," "expect," "anticipate," "future," "plan," "believe," "intend," "goal," "seek," "endeavor," "estimate," "project," "continue," and variations of such words and similar expressions. These forward-looking statements are not guarantees of future performance and involve risks, assumptions, and uncertainties, including, but not limited to, risks related to: Axonics’ ability to consummate the transactions contemplated by the Agreement and Plan of Merger, dated January 8, 2024 (the "Merger Agreement"), by and among Axonics, Boston Scientific Corporation ("Boston Scientific"), and Sadie Merger Sub, Inc., a wholly owned subsidiary of Boston Scientific ("Merger Sub"), providing for the merger of Merger Sub with and into Axonics with Axonics continuing as the surviving company and a wholly owned subsidiary of Boston Scientific (the "Merger"), in a timely manner or at all; the risk that the Merger Agreement may be terminated in circumstances requiring the payment by Axonics of a termination fee; the satisfaction (or waiver) of the conditions to the closing of the Merger; potential delays in consummating the Merger; the occurrence of any event, change or other circumstance or condition that could give rise to termination of the Merger Agreement; Axonics’ ability to timely and successfully realize the anticipated benefits of the Merger; the ability to successfully integrate the businesses of Axonics and Boston Scientific; the effect of the announcement or pendency of the Merger on Axonics’ current plans, business relationships, operating results and business generally; the effect of limitations placed on Axonics’ business under the Merger Agreement; significant transaction costs and unknown liabilities; litigation or regulatory actions related to the Merger Agreement or Merger; FDA or other U.S. or foreign regulatory or legal actions or changes affecting Axonics or Axonics’ industry; the results of any ongoing or future legal proceedings, including the litigation with Medtronic, Inc., Medtronic Puerto Rico Operations Co., Medtronic Logistics LLC and Medtronic USA, Inc. (the "Medtronic Litigation"); any termination or loss of intellectual property rights, including as a result of the Medtronic Litigation; introductions and announcements of new technologies by Axonics, any commercialization partners or Axonics’ competitors, and the timing of these introductions and announcements; changes in macroeconomic and market conditions and volatility, including the risk of recession, inflation, supply chain constraints or disruptions and rising interest rates; and economic and market conditions in general and in the medical technology industry specifically, including the size and growth, if any, of Axonics’ markets, and risks related to other factors described under "Risk Factors" in other reports and statements filed with the U.S. Securities and Exchange Commission ("SEC"), including Axonics’ most recent Annual Report on Form 10-K, which is available on the investor relations section of Axonics’ website at www.axonics.com and on the SEC’s website at www.sec.gov. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated or anticipated by these forward-looking statements. Therefore, you should not rely on any of these forward-looking statements.

The forward-looking statements included in this press release are made only as of the date of this press release, and except as otherwise required by federal securities law, Axonics does not assume any obligation nor does it intend to publicly update or revise any forward-looking statements to reflect new information, changed circumstances or unanticipated events.

Axonics, Inc. Consolidated Balance Sheets (in thousands, except share and per share data) June 30, December 31, 2024 2023 (unaudited) ASSETS Current assets Cash and cash equivalents $ 168,619 $ 104,811 Short-term investments 174,792 240,149 Accounts receivable, net of allowance for credit losses of $1,111 and $442 at June 30, 2024 and December 31, 2023, respectively 57,221 57,243 Inventory, net 105,428 79,940 Prepaid expenses and other current assets 6,003 9,279 Total current assets 512,063 491,422 Restricted cash 18,629 12,714 Property and equipment, net 18,382 10,760 Intangible assets, net 76,333 81,375 Other assets 23,183 24,235 Goodwill 98,747 99,417 Total assets $ 747,337 $ 719,923 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities Accounts payable $ 19,316 $ 18,452 Accrued liabilities 11,042 10,527 Accrued compensation and benefits 24,793 15,060 Operating lease liabilities, current portion 2,022 1,777 Total current liabilities 57,173 45,816 Operating lease liabilities, net of current portion 30,431 25,840 Deferred tax liabilities, net 16,417 10,703 Total liabilities 104,021 82,359 Commitments and contingencies Stockholders’ equity Preferred stock, par value $0.0001 per share; 10,000,000 shares authorized, no shares issued and outstanding at June 30, 2024 and December 31, 2023 — — Common stock, par value $0.0001, 75,000,000 shares authorized at June 30, 2024 and December 31, 2023; 51,014,562 and 50,770,520 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively 5 5 Additional paid-in capital 1,052,429 1,033,778 Accumulated deficit (392,565 ) (380,352 ) Accumulated other comprehensive loss (16,553 ) (15,867 ) Total stockholders’ equity 643,316 637,564 Total liabilities and stockholders’ equity $ 747,337 $ 719,923

Axonics, Inc. Consolidated Statements of Comprehensive Income (Loss) (in thousands, except share and per share data) (unaudited) Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Net revenue $ 114,565 $ 92,894 $ 205,974 $ 163,544 Cost of goods sold 25,422 22,704 47,578 40,854 Gross profit 89,143 70,190 158,396 122,690 Operating expenses Research and development 12,792 8,949 23,848 17,005 General and administrative 16,327 10,713 31,431 22,881 Sales and marketing 51,444 44,270 107,635 86,924 Amortization of intangible assets 2,247 2,279 4,501 4,501 Acquisition-related costs 2,652 602 6,479 2,368 Acquired in-process research & development — 15,447 — 15,447 Total operating expenses 85,462 82,260 173,894 149,126 Income (loss) from operations 3,681 (12,070 ) (15,498 ) (26,436 ) Other income (expense) Interest and other income 4,702 4,250 8,675 7,878 Interest and other expense (32 ) 174 (91 ) 857 Other income, net 4,670 4,424 8,584 8,735 Income (loss) before income tax expense (benefit) 8,351 (7,646 ) (6,914 ) (17,701 ) Income tax expense (benefit) 1,452 (304 ) 5,299 (1,111 ) Net income (loss) 6,899 (7,342 ) (12,213 ) (16,590 ) Foreign currency translation adjustment 466 3,750 (686 ) 6,821 Comprehensive income (loss) $ 7,365 $ (3,592 ) $ (12,899 ) $ (9,769 ) Net income (loss) per share, basic $ 0.14 $ (0.15 ) $ (0.24 ) $ (0.34 ) Weighted-average shares used to compute basic net income (loss) per share 50,010,380 49,088,373 50,971,867 48,835,135 Net income (loss) per share, diluted $ 0.13 $ (0.15 ) $ (0.24 ) $ (0.34 ) Weighted-average shares used to compute diluted net income (loss) per share 51,230,849 49,088,373 50,971,867 48,835,135

Axonics, Inc. Net Revenue by Product and Region (in thousands) (unaudited) Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Sacral neuromodulation United States $ 89,076 $ 72,205 $ 158,916 $ 126,058 International 2,139 1,983 3,978 3,288 Sacral neuromodulation total $ 91,215 $ 74,188 $ 162,894 $ 129,346 Bulkamid United States $ 18,306 $ 14,806 $ 33,525 $ 26,419 International 5,044 3,900 9,555 7,779 Bulkamid total $ 23,350 $ 18,706 $ 43,080 $ 34,198 Total net revenue $ 114,565 $ 92,894 $ 205,974 $ 163,544

Axonics, Inc. Reconciliation of GAAP Net Income (Loss) to Adjusted EBITDA (in thousands) (unaudited) Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 GAAP Net income (loss) $ 6,899 $ (7,342 ) $ (12,213 ) $ (16,590 ) Non-GAAP Adjustments: Interest and other income (4,702 ) (4,250 ) (8,675 ) (7,878 ) Interest and other expense 32 (174 ) 91 (857 ) Income tax expense (benefit) 1,452 (304 ) 5,299 (1,111 ) Depreciation and amortization expense 2,901 3,228 6,083 6,041 Stock-based compensation expense 8,611 11,204 18,162 21,918 Acquisition-related costs 2,652 602 6,479 2,368 Cash compensation in lieu of equity compensation due to pending merger 5,591 — 11,182 — Acquired in-process research & development — 15,447 — 15,447 Adjusted EBITDA $ 23,436 $ 18,411 $ 26,408 $ 19,338

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Contacts

Axonics contact:
Neil Bhalodkar
[email protected]