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Conformis reported 2Q21 orthopedic revenue of $56.3 million, +184.4% vs. 2Q20. The company expects royalty revenue to comprise roughly 1% of its quarterly revenue, but in the second quarter, it accounted for 73% or $41 million. Virtually the entire amount came from one-time payments including the final milestone payment from Stryker for patient-specific instruments, a favorable settlement of litigation with Wright Medical and a license agreement with Paragon 28.
Conformis views the protection of its intellectual property as a key strategic pillar, but it is trying to find some stability through an expanded product portfolio and international presence. The company’s “surgery in a box” hip replacement model is gaining traction in both hospitals and ASCs. The Identity Imprint, or ASC knee, should complete its first procedures near the end of 3Q. While international markets remain a small contributor, Conformis expanded its footprint in China with a new exclusive distribution agreement.
Although the entire market for large joint replacement remains depressed compared to its pre-pandemic volume, Conformis consistently experiences greater declines than peers. Compared to 2Q19, the company’s product revenue declined -22%. Conformis opted to not give formal revenue guidance for 2021, but believes it could return to pre-pandemic product sales by the fourth quarter.
Revenue Data
All revenue data is provided in USD millions unless otherwise noted. Sales and growth rates are estimated on an as-reported basis.
Segment Sales
| 2Q21 | 2Q20 | $ Chg | % Chg | |
|---|---|---|---|---|
| Joint Replacement Knees | $55.4 | $18.9 | $36.5 | 193.2% |
| Joint Replacement Hips | $0.9 | $0.6 | $0.3 | 62.2% |
| Total | $56.3 | $19.5 | $36.9 | 189.4% |
| 1H21 | 1H20 | $ Chg | % Chg | |
|---|---|---|---|---|
| Joint Replacement Knees | $68.6 | $34.9 | $33.7 | 96.4% |
| Joint Replacement Hips | $1.6 | $1.0 | $0.6 | 56.3% |
| Total | $70.2 | $35.9 | $34.2 | 95.3% |
Geographic Sales
| 2Q21 | 2Q20 | $ Chg | % Chg | |
|---|---|---|---|---|
| US | $54.6 | $18.1 | $36.5 | 202.2% |
| OUS | $1.8 | $1.4 | $0.4 | 25.7% |
| Total | $56.3 | $19.5 | $36.9 | 189.4% |
| 1H21 | 1H20 | $ Chg | % Chg | |
|---|---|---|---|---|
| US | $66.3 | $32.1 | $34.2 | 106.8% |
| OUS | $3.9 | $3.9 | $0.0 | 0.2% |
| Total | $70.2 | $35.9 | $34.2 | 95.3% |
Earnings
| Amt | % of Sales | |
|---|---|---|
| Sales | $56.3 | |
| Cost of Sales | $8.8 | 15.6% |
| Selling and Marketing | $6.3 | 11.2% |
| General and Admin | $6.7 | 11.9% |
| R & D | $3.5 | 6.3% |
| Other | ($7.0) | (12.5%) |
| Net Earnings | $38.0 | 67.5% |
Mike Evers is ORTHOWORLD’s Digital Content Strategist. He can be reached by email.
Conformis reported 2Q21 orthopedic revenue of $56.3 million, +184.4% vs. 2Q20. The company expects royalty revenue to comprise roughly 1% of its quarterly revenue, but in the second quarter, it accounted for 73% or $41 million. Virtually the entire amount came from one-time payments including the final milestone payment from Stryker for...
Conformis reported 2Q21 orthopedic revenue of $56.3 million, +184.4% vs. 2Q20. The company expects royalty revenue to comprise roughly 1% of its quarterly revenue, but in the second quarter, it accounted for 73% or $41 million. Virtually the entire amount came from one-time payments including the final milestone payment from Stryker for patient-specific instruments, a favorable settlement of litigation with Wright Medical and a license agreement with Paragon 28.
Conformis views the protection of its intellectual property as a key strategic pillar, but it is trying to find some stability through an expanded product portfolio and international presence. The company’s “surgery in a box” hip replacement model is gaining traction in both hospitals and ASCs. The Identity Imprint, or ASC knee, should complete its first procedures near the end of 3Q. While international markets remain a small contributor, Conformis expanded its footprint in China with a new exclusive distribution agreement.
Although the entire market for large joint replacement remains depressed compared to its pre-pandemic volume, Conformis consistently experiences greater declines than peers. Compared to 2Q19, the company’s product revenue declined -22%. Conformis opted to not give formal revenue guidance for 2021, but believes it could return to pre-pandemic product sales by the fourth quarter.
Revenue Data
All revenue data is provided in USD millions unless otherwise noted. Sales and growth rates are estimated on an as-reported basis.
Segment Sales
| 2Q21 | 2Q20 | $ Chg | % Chg | |
|---|---|---|---|---|
| Joint Replacement Knees | $55.4 | $18.9 | $36.5 | 193.2% |
| Joint Replacement Hips | $0.9 | $0.6 | $0.3 | 62.2% |
| Total | $56.3 | $19.5 | $36.9 | 189.4% |
| 1H21 | 1H20 | $ Chg | % Chg | |
|---|---|---|---|---|
| Joint Replacement Knees | $68.6 | $34.9 | $33.7 | 96.4% |
| Joint Replacement Hips | $1.6 | $1.0 | $0.6 | 56.3% |
| Total | $70.2 | $35.9 | $34.2 | 95.3% |
Geographic Sales
| 2Q21 | 2Q20 | $ Chg | % Chg | |
|---|---|---|---|---|
| US | $54.6 | $18.1 | $36.5 | 202.2% |
| OUS | $1.8 | $1.4 | $0.4 | 25.7% |
| Total | $56.3 | $19.5 | $36.9 | 189.4% |
| 1H21 | 1H20 | $ Chg | % Chg | |
|---|---|---|---|---|
| US | $66.3 | $32.1 | $34.2 | 106.8% |
| OUS | $3.9 | $3.9 | $0.0 | 0.2% |
| Total | $70.2 | $35.9 | $34.2 | 95.3% |
Earnings
| Amt | % of Sales | |
|---|---|---|
| Sales | $56.3 | |
| Cost of Sales | $8.8 | 15.6% |
| Selling and Marketing | $6.3 | 11.2% |
| General and Admin | $6.7 | 11.9% |
| R & D | $3.5 | 6.3% |
| Other | ($7.0) | (12.5%) |
| Net Earnings | $38.0 | 67.5% |
Mike Evers is ORTHOWORLD’s Digital Content Strategist. He can be reached by email.
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ME
Mike Evers is a Senior Market Analyst and writer with over 15 years of experience in the medical industry, spanning cardiac rhythm management, ER coding and billing, and orthopedics. He joined ORTHOWORLD in 2018, where he provides market analysis and editorial coverage.
