Yahoo Finance Vicarious Surgical Inc. (NYSE:RBOT) Q1 2024 Earnings Call Transcript
Vicarious Surgical Inc. (NYSE:RBOT) Q1 2024 Earnings Call Transcript April 29, 2024
Vicarious Surgical Inc. beats earnings expectations. Reported EPS is $-0.09, expectations were $-0.1. RBOT isn't one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).
Operator: Hello. And welcome to Vicarious Surgical’s 2024 First Quarter Earnings Call. My name is Elliot, and I’ll be coordinating your call today. [Operator Instructions] I’d now like to hand over to Kaitlyn Brosco, Head of Investor Relations. The floor is yours. Please go ahead.
Kaitlyn Brosco: Thanks Elliot, and thank you all for joining. With me today for prepared remarks are Adam Sachs, Co-Founder and Chief Executive Officer; and Bill Kelly, Chief Financial Officer. Later, Randy Clark, our new company President, will join for the Q&A portion of this call. Today after market closed, Vicarious Surgical released financial results for the three months ended March 31, 2024. A copy of this press release is available on the company website. Before we begin, I’d like to remind you that management will make statements during this call that include forward-looking statements within the meaning of federal securities laws, which are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995.
Any statements contained in this call that relate to expectations or predictions of future events, results or performance are forward-looking statements. All forward-looking statements, including without limitation, those relating to obtaining approval for the Vicarious Surgical system and timing for any such approval, our operating trends and future financial performance, expense management, market opportunity and commercialization are based upon our current estimates and various assumptions. These statements involve material risks and uncertainties that would cause actual results or events to materially differ from those anticipated or implied by these forward-looking statements. Accordingly, you should not place any undue reliance on these statements.
For a list and description of the risks and uncertainties associated with the business, please refer to the risk factors set forth in our Securities and Exchange Commission filings, including our most recent Form 10-K and Form 10-Q. This conference call contains time-sensitive information and is accurate only of this live broadcast today, April 29, 2024. Vicarious Surgical disclaims any intention or obligation, except as required by law, to update or revise any financial projections or forward-looking statements, whether because of new information, future events or otherwise. Now, I’ll hand the call over to Adam for prepared remarks.
Adam Sachs: Thanks, Kate, and thank you, everyone, for joining us. I’m proud to report a strong start to the year as we advance our mission to improve lives by transforming surgical robotics. In the first quarter, we made meaningful progress toward the finalization of our V1.0 system. The collective efforts of our development team culminated in the completion of our spring cadaver lab at the end of March. This lab marked the first use of our integrated V1.0 system in a cadaveric procedural setting, with the primary goal of validating the capabilities and potential of the new system’s feature set. I’m pleased to share that the lab proceeded as we had anticipated, verifying several advancements in development and yielding valuable insights across the system.
During the lab, our V1.0 system showcased the tremendous potential inherent in our novel platform. Underpinned by the new fortified software, electronic and mechanical architecture, and supported by enhanced instrumentation and visualization technology, the V1.0 system exhibited the dynamic motion capabilities of our patient cart, facilitated maneuverability within the abdominal cavity and enabled 360-degree visualization and access to targeted surgical sites. We highlighted many of these specific V1.0 development goals in our remarks last year and I’m happy to report the success of our team’s diligent efforts since. As anticipated, in addition to our development success, the lab offered insight into the additional refinements required for our final system.
Over the next few quarters, our team will focus on leveraging these insights to fine-tune the V1.0 system in preparation for formal verification and validation testing. Taking a step back, I’d like to contextualize the detailed development work we are performing against the broader landscape for surgical robotics to remind our stakeholders why we believe our offering is poised to take a disproportionate share of this market over time. Even with considerable progress over the past few decades, the field of surgical robotics is still in its infancy. Despite substantial growth and varying new market entrants, around 96% of the estimated $150 billion market opportunity remains white space. Recent strategic activity in the space continues to strongly support this notion that robotics is the future of surgery.
And while existing robotic technology has notably augmented surgeons’ capabilities, these multi-port systems have amplified costs to the hospital system without addressing the technology’s fundamental limitations. For example, lack of instrument dexterity and range of motion constrains surgeons to utilizing wrist-on-a-stick instruments that necessitate multiple incisions to the patient and require cumbersome instrument triangulation by the surgeon. This approach introduces complexity both during the procedure and in preoperative steps, contributing to the steep learning curve for new users and the low 4% adoption rate for surgical robotics today. Vicarious Surgical was founded on the recognition of these limitations of multi-port surgical robots.
Instead of building off legacy robotic technology, we reimagined surgical robotics from the ground up. Core to our reimagined architecture is our proprietary decoupled actuator technology, which prevents the force buildup in the joints of each instrument arm, significantly enhancing the dexterity and range of motion of our system, and thereby eliminating the need for multiple incisions required for instrument triangulation. Through a single 18-millimeter incision, our system is designed to achieve full intra-abdominal access with high force exertion for our targeted surgical indication. We believe this streamlined approach will enhance procedural efficiency and remove the training demands on new surgeons for every procedure. With today’s offerings predominantly limited to multi-port wrist-on-a-stick technology, we, along with our hospital system partners, see this as a distinct clinical and commercial advantage.
We are confident that our technology’s unique capabilities will establish a lasting competitive edge for us in the robotic assisted surgery market and with the completion of our spring cadaver lab, we are excited to have taken another step towards finalizing our differentiated system. With that, I will turn it over to Bill to review our financial performance.
Bill Kelly: Thank you, Adam. As expected, our 2023 initiatives to streamline resources, optimize spending and restructure the company for maximum efficiency are yielding a benefit to our 2024 expense profile. As a result, total operating expenses for the first quarter of 2024 were $16.1 million, a 28% decrease, compared to $22.3 million in the first quarter of last year. R&D expenses for the first quarter of 2024 were $10 million, compared to $13.4 million in the first quarter of 2023. General and administrative expenses for the first quarter of 2024 were $5 million, down from $7 million in the first quarter of 2023. In first quarter 2024, sales and marketing expenses were $1.1 million versus $2 million in the first quarter of 2023.
Again, the year-over-year reduction in operating expenses reflects the diligent efforts made throughout last year to optimize our burden and prioritize capital efficiency. Continuing on, adjusted net loss for the first quarter of 2024 was $15.1 million, equating to a net loss of $0.09 per share, as compared to an adjusted net loss of $20.8 million or $0.17 per share, in the first quarter of 2023. GAAP net loss for the first quarter of 2024 was $17 million, equating to a net loss of $0.10 per share and this compares to a net loss of $26.9 million or $0.21 per share, in the first quarter of 2023. For a reconciliation of all non-GAAP measures to GAAP, please review our earnings press release. We ended the first quarter of this year with approximately $84 million of cash, cash equivalents and short-term investments on our balance sheet.
This represents a first quarter cash burn rate of approximately $14 million. Note that while first quarter cash burn was slightly elevated as a result of a few seasonally timed payments, we continue to expect full year 2024 cash burn to be approximately $50 million and remain committed to disciplined capital allocation. 2024 is off to a strong start and our team is executing with the urgency and discipline needed to achieve our development timeline, including the completion of the V1.0 system build and integration this fall. We look forward to updating you as we progress with our business initiatives in the coming quarters. And with that, I’ll turn the call back to Adam for closing remarks. Adam?
Adam Sachs: Thank you, Bill. I’d like to close by reemphasizing the way in which we as a company have differentiated ourselves within the broader robotics market. While many surgical robotics companies continue to iterate on legacy platforms, we are taking a new path forward. While this approach takes careful time and consideration, we remain steadfast in the value of our unique technology. I’d like to thank all of our stakeholders, particularly our employees, for their continued support of our mission and vision. Elliot, we’re now happy to take any questions.
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