Q1 2023 Globus Medical Inc Earnings Call
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Welcome to Globus Medicals first quarter 2023 earnings call.
At this time, all participants are in listen only mode.
After the Speakers' presentation, there will be a Q&A session to ask a question. During this session you will need to press star one one on your telephone you would be in here an automated message advising your hand is raised.
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Please be advised that today's conference is being recorded.
I'd now like to hand, the conference over to your Speaker today, Brian Kearns.
So your vice President of business development and Investor Relations. Please.
Please go ahead.
Thank you Antoine and thank you everyone for being with us today joining.
Joining todays call from Globus medical will be dance, Cabello, President and Chief Executive Officer, and Keith Pfeil, Chief Financial Officer.
This review is being made available via webcast accessible through the Investor Relations section of the Globus medical website at Www Dot Guac Globus medical Dot com.
Before we begin let me remind you that some of the statements made during this review are or maybe considered forward looking statements.
Our Form 10-K for the 2022 fiscal year and our subsequent filings with the Securities and Exchange Commission.
Certain factors that could cause our actual results to differ materially from those projected in any forward looking statements made today are.
Our SEC filings, including the 10-K are available on our website.
We do not undertake to update any forward looking statements as a result of new information or future events or developments. Our discussion. Today will also include certain financial measures that are not calculated in accordance with generally accepted accounting principles or GAAP. We believe these non-GAAP financial measures provide additional information pertinent to our business.
Performance. These non-GAAP financial measures should not be considered replacements for and should be read together with the most directly comparable GAAP financial measures reconciliations to the most directly comparable GAAP measures are available in the schedules accompanying the press release and on the Investor Relations section of the Globus medical website.
I'll now turn the call over to Dan <unk>, our president and CEO .
Thanks, Brian and good afternoon, everyone.
Globus achieved strong results in Q1, delivering record sales of $277 million.
A 21% increase in constant currency or $46 million in growth versus Q1 'twenty two.
non-GAAP EPS was <unk> 53 cents, increasing 25% and free cash flow was $37 million up 51% versus Q1 'twenty two.
Adjusted EBITDA for the quarter was 31%.
Keith will speak more about these items in his section.
2023 is starting out to be a strong year for globus standalone business that should deliver record sales and strong cash flows mid thirties, EBITA and gains in E. P. S.
Looking deeper into Q1 performance.
Your spine grew 14% in the quarter with notable gains across our product portfolio and expandable bylaw.
Biologics M. I S screws, three D printed implants and cervical offerings. This above market growth is driven by competitive rep recruiting from prior quarters robotic pull through and a normalization of post COVID-19 procedures versus prior year.
In Q1, we launched our Mars T lift pedicle based retractor as part of our focus on procedural efficiency to offer specialized options to meet surgeon preferences.
We also continue to make significant progress in launching our pro lateral patient positioning system.
It is an interactive adjustable bed milk that enables a single position single stage lateral surgical approach for direct and indirect decompression designed to maximize operational efficiency.
Increased ease of implant placement.
And minimize surging fatigue.
It integrates seamlessly with our Celsis GPS and <unk> solutions and also enables significant capabilities in non robotic procedures.
When combined with our <unk> platform and a range of expandable interbody offerings, we can provide unique and customized well lateral solutions for our surgeons.
Enabling technology sales were $25 million up 91% on a constant currency basis versus prior year, driven by robotic and imaging system sales. This represents our highest Q1 robot sales to date we.
We continue to see increased interest in sales with significant international gains of Excelsior GPS in EMEA and Asia Pac that will lead to future implant pull through and strong market share gains.
As we enter Q2, we have one of the strongest robot pipeline since launching the system.
For about our procedures continued to accelerate growing 51% versus prior year and exceeding 49000 robotic procedures performed to date.
We continue to make positive inroads with our Chelsea is three D imaging system.
Surgeons, who said this is a game changer as they experience the benefits of integrated imaging.
<unk> is a three in one imaging platform offering three image modalities in a single cart with high Manoeuvrability, a large field of view and seamless integration with our Chelsea is GPS robotic navigation system.
It is a key component of the Globus ecosystem designed and built from the ground up to communicate with access GPS in the operating room.
Market interest remains high for the state of the art technology and customer orders continue to grow <unk> three D is positioned to be a major growth driver for 2023.
Our international spinal implant business, excluding Japan delivered record sales in Q1 growing 30% on a constant currency basis compared to prior year.
We delivered double digit growth in most markets and continue to see strong growth in key markets.
Japan delivered 17% constant currency growth for Q1.
We expect to see gains in Japan throughout the year as we focus on recapturing market share.
Our trauma business delivered its 13th consecutive quarter of sequential growth delivering 53% growth for Q1 and 16% sequentially.
<unk> performance was driven by sales force expansion and strong uptake in all product lines delivering strong growth throughout our portfolio, including the Autobahn Evo femoral nail system launched last quarter.
It continues to take and make inroads to for market share gains.
To update you on the merger status, both Globus medical and invasive class a shareholders voted overwhelmingly in support of the merger with over 99% of proving the transaction.
This is a major milestone and the support of the combined shareholders moves us closer to realizing the deal.
Earlier. This week, we received notification from the Federal Trade Commission for a second request and we're working with the FTC to address their open questions.
The second request will impact the anticipated deal closure timing moving from mid 2023 to Q3 2023. However, it does not alter our commitment to the deal.
Our belief that this combination will benefit to surgeons and patients in the markets, where we compete.
We're replacing all resources required to quickly address the FTC questions and drive to a successful outcome.
In closing.
We remain focused on the core elements for long term sustained growth.
<unk> innovative new product introductions.
<unk> robot and imaging system sales three competitive rep recruiting and for merger integration planning.
2023 is all about focus and execution to deliver value to our customers and drive growth.
I know, we are well positioned to achieve our mission of becoming the preeminent muscular skeletal company in the World I will now turn the call over to Keith.
Thanks, Dan and good afternoon, everyone.
We are extremely pleased with our first quarter results they demonstrate our growing position in the market.
Strong sales growth was seen across our portfolio and geographies as we've continued to take share while also not experiencing the procedural softness seen in last year's first quarter.
Our Q1 revenue was $276 7 million growing 20% as reported and 21% on a constant currency basis.
Net income was $49 $1 million, resulting in fully diluted GAAP earnings per share of <unk> 48.
non-GAAP net income was $53 $8 million delivering 53 of fully diluted non-GAAP earnings per share representing 25, 1% growth over the prior year quarter.
Turning our attention to sales Q1, musculoskeletal revenue was $251 6 million growing 15, 7% as reported when compared to the prior year quarter.
Growth was led primarily by our spine business driven by strong procedural volumes both in the U S and international driven by continued share taking as well as softer comps when compared to the prior year quarter.
First quarter 2023, enabling technologies revenue grew 98% as compared to the prior year quarter, driven by ongoing demand for our robotics and imaging system technologies.
Specifically note that a robotic pipeline and its development was strong coming out of Q4 and remained so heading into our first quarter of 2023, both in the U S as well as internationally.
First quarter U S revenue was $234 1 million growing 19, 2% as reported led by our spine and INR businesses as well as our biologics and trauma businesses as Dan mentioned earlier.
International revenue was $42 6 million growing 24, 7% as reported and 31, 5% on a constant currency basis.
Growth was again led by our international spinal implant businesses, mainly in Australia.
Brazil, Poland, the UK, Spain, and Germany, our strategy.
<unk> remains consistent as we seek to drive greater share in our focused countries across our international markets.
Gross profit in the first quarter of 2023 was 74, 4% essentially flat to the 74, 3% in the prior year quarter increased.
Increased product costs as a result of product and geographic mix were partially offset by lower inventory write offs related to scrap as well as improved manufacturing and supply chain efficiencies.
Research and development expenses for the quarter were $21 1 million or seven 6% of sales consistent with the prior year.
The increased dollar spend remains consistent with our strategy of growth around procedural solutions is reflected in higher spend mainly in our spine and enabling technologies businesses, which will help sustain sales growth as we move ahead.
SG&A expenses in the first quarter of 2023, or $122 4 million or <unk> 44, 2% of sales compared to $100 7 million or 43, 7% of sales in the prior year quarter.
The increased spending is primarily reflective of higher personnel related expenses, primarily driven by sales compensation as well as higher meetings travel and training expenses.
Sales compensation increases are primarily the result of achieving growth targets, while travel as a result of the timing of our annual global sales meeting.
The effective income tax rate for the quarter was 22, 3% up slightly to the 22, 1% noted in the prior year and in line with expectations.
Adjusted EBITDA was 38% in the quarter as reflected in my earlier comments on gross profit and SG&A impacts and is largely in line with our Q1 'twenty three expectations.
non-GAAP EPS in the first quarter of 2023 was <unk> 53 compared.
Compared to <unk> 42 in the prior year quarter, the 11% growth includes <unk> <unk> of non operating items, namely higher interest income and a lower share count partially offset by higher depreciation expense.
Free cash flow was $37 3 million in Q1, $12 $6 million higher versus the prior year quarter, driven by higher cash profits and lower capex, partially offset by working capital investments in inventory and accounts receivable.
We ended the first quarter with $984 $4 million of cash cash equivalents and marketable securities the company remains debt free.
Our Standalone 2023 guidance remains unchanged at $1 1 million billion net sales and $2 30, and fully diluted non-GAAP EPS.
In closing I want to reiterate a few brief comments and a dash. In addition to Dan's earlier comments as it relates to globus invasive merger.
Once regulatory approvals are obtained in the transaction closes we expect to deliver 20% non-GAAP EPS accretion by the completion of the first full year following deal closure.
We expect near term sales dis synergies to be partially offset by revenue synergies around complementary product offerings at both companies. In addition, we expect to deliver on $170 million of cost synergies of which we expect to achieve 50% by the end of the year. One following deal closure, 75% by the end of year, two and 100% by the end of the third year.
We remain confident in the strength of our global business and remain steadfast in driving organic growth, while seeking to close and integrate our merger with invasive.
Post close we will continue to seek both organic and inorganic growth opportunities as we continue to develop new and exciting technologies internally, while also deploying cash for complementary M&A opportunities.
We seek to achieve on our long term objectives I want to thank our global team members as we continue to improve the lives of patients with muscular skeletal disorders.
Operator, we will now open the call for questions.
Thank you.
This time, we will conduct a Q&A session. As a reminder to ask a question you would need to press star one one on your telephone and wait for your name to be announced to.
To withdraw your question. Please press star one again.
Please standby, while we compile the Q&A roster.
Alright, and our first question comes from Mike <unk> from Barclays. Please go ahead.
Yes.
Hey, good evening. Thanks, so much for taking the questions and congrats on a really strong quarter guys.
Thanks.
So.
One question about the <unk>.
Sort of pending merger and one on the operations if I could so.
So on the on the <unk>.
Merger.
Just wondering if you have.
I know that you were spending a fair amount of time together to.
To the extent that you're allowed at this stage.
And I'm wondering if there's anything that you've learned or seen that's either strengthen some of the some of the areas of synergy and opportunity that you saw before and it knocked about.
Before you before you guys do quite theater or anything.
Anything that sort of.
Incrementals in terms of your insights and those meetings and again planning sessions to the extent that you can at this stage and then one follow up.
Thanks, Matt This is Dan I'll answer that.
We continue to work together for planning and organization and learning with this and I would tell you that throughout the value streams and the work streams that we've set up.
It's really been more positive the more we work together and I know Theres a lot of talk about culture out there and I'll admit that there are differences in culture, but what I've learned is that to over exaggerate. It I think we are more similar than folks who had realized when you get down to the core of it they've got an incredibly strong leadership team I've found that every person there is top quality and.
The willingness and the thought process of how to move forward is very aligned so I'll be honest the more I worked in more encouraged I am to see that.
As I learned about their strength says we've talked about before whether it be the surgeon experience or even marketing or how they do training.
Seeing how that could further globus.
Going forward as well to me remains enticing to do.
Great and then just on.
On the strength in the quarter.
<unk> quite a bit.
With a stronger certainly than we were expecting quite a bit stronger than I.
I think most folks were expecting.
Could you talk a little bit about im sure Youre going to get this question in Marysville tackle it upfront is the strength in the quarter and then that sort of.
Tempering aspects of holding back on a race so sources of the strain.
If there were surprises to you and then why not take up something here.
For the remainder of the year.
This is Keith.
I'll take that and Dan can add anything he wants at the end, but I think the first quarter was extremely strong I.
I talked a little bit about the robotic pipeline remaining strong coming into the quarter that was definitely a benefit but I think as I as I look at the year and look at the quarter, specifically, we had a very very strong international quarter.
And some of our international markets, we do have some distributors and there could be some stocking orders in there that may have kind of pushed that up a little bit and quite honestly when I step back and look at the year, we still feel extremely good about the business. We still think it's too early to give a raised the full year lock it will happen in the year, but we're really happy with how the quarter landed.
Matt I'll build on that we don't plan on exiting the year as a Standalone company, we are expecting to execute on this and so any standalone guidance for the year, while directional for you isn't really meaningful as we get into the rest of the year.
Sure that's fair thanks, so much.
<unk>.
Thank you Matt.
One moment for our next question.
Our next question comes from <unk> <unk> from RBC. Please go ahead.
Great. Thank you so much for taking my question and congratulations on the shareholder support for the deal.
So I understand a big focus right now is to get through the FTC process and they have made a second request.
Some additional price do you are there any specific areas or products that.
Have been identified.
Buddy cages biologics I know one of your filings mentioned neuro monitoring and enabling that Craig you guys have leading positions.
Wondering if there's anything you can share on the.
The FTC process and potential divestitures.
And then I have a follow up.
Thanks sure John This is Dan.
I would tell you that as you know second requests are not unusual and I would say that from what I've seen certainly no need for alarm with this we remain committed to the deal or it doesn't do anything to change where we are what we want to do with this shifts the timing a little bit.
I can't go into the specifics of it there is nothing out there that felt alarming and what was given to US I will tell you that and everything and I had seen so far has been fairly general nothing focused in specifically that I think right. Now we are aware of or that I could share. So to me I think it's an overall data search we have to <unk>.
Step up and give them what they need we will do that as fast as we can so that we can progress forward and realize the potential that's in front of us.
Got it and can you talk about the sales force morale as the deal was announced but it is still pending closing.
Driving any amount of uncertainty among your sales rep. What steps are you taking to ensure that competitors don't push on your sales reps and then also maybe you can talk a little bit about the trends you're seeing in some better does that preclude Glenn versus recent quarters. Thank you for taking the questions.
Hey, you got it so I would tell you all of US are really looking forward to consummating this and moving forward. So any delay is certainly not a welcomed thing, but I would tell you that as I talked directly with the sales leadership of both companies and down to the rep level.
Exciting remains there and it's it's incumbent upon us to work through this and push it forward, our field and <unk> field realize that bringing together our teams and looking at those technologies and combining them can really drive incredible benefits for surgeons and patients. They know that this is the place to be and they know that this <unk>.
<unk> is stronger than all others. So I think we just have to remind any of those who might be a little weary that this is the place to be and it's incumbent upon us to work through it and get it done that way.
As far as recruiting goes what we've mentioned in the past is this deal while it certainly is consuming a lot of our time as it ought to.
It's creating a lot of competitive rep interest folks who want to join this team and look at what the future is and so it feels to be a bit more proactive competitive rep recruiting coming to us versus us going to seek it out right now as we realized us.
Thank you for the color.
Thank you Scott.
One moment for our next question.
Okay.
Our next question comes from David Saxon from Needham and co.
Please go ahead.
Great.
Dan Thanks, so much for taking the questions and congrats on a really strong quarter here.
Maybe first on yes may be first on enabling tech I mean, you called out.
Good robotics demand trends.
Sounds like those remained strong so I just wanted to kind of get your thoughts on where we are in terms of robotics penetration in spine.
Kind of where does that shake out longer term.
Like a steady grind or is there something that Ken.
In fact that at some point.
As Keith Thanks for the call I would say that we're still.
A trend with the robotic market that the capital is still being accepted the market is growing I think that when you think about penetration of the market I still think theres plenty of market for us to grow I think adopters are still continuing to come on that's still our belief that as time passes robots will be part of the future from that from a surgical perspective for <unk>.
<unk> procedures.
I would add to it too.
I think it's more of a steady grind its about creating awareness and certainly people's willingness to test and therefore adopt and so given the new technology that it is for everybody. It's just a matter of working through that versus a large explosion that may occur instantly.
Okay got it.
And then maybe on international specifically on Japan.
Group or that team grew rich I mean, I can't remember the last time.
Bandwidth Mcqueen so.
How is that going as the team fully right sized there or is there still wood to chop.
And then I think you called out some stocking orders.
Through international distributors any way to quantify the benefit you saw there and thanks so much.
Thanks, So I'll start it and then Keith can kind of finish it up so we've been investing in first often in international outside of Japan.
Giving them the tools to penetrate and it's great to see the traction there and I think that team is motivated and driven with every country I speak to are feeling really good about their mindset and the potential that's there Japan as you know we've done some rightsize some reorganization some adjusting of vendors and things like that are customers excuse me.
And I feel as we've been calling out that that would be bottoming out.
Seen that occur really starting in the fourth quarter and with the team. That's in place now regaining traction when you say more wood to chop I don't think we're looking to downsize that team I think we have to enhance its size. When we continue to recruit and look as a method to penetrate and grow even more.
And as it relates to stocking orders and my earlier comment.
When I look at internationally places, where we see some stocking orders would be Spain and Brazil.
From the standpoint of the growth rate it definitely would have slowed the growth rate down a little bit, but I would not say materially we came out of the quarter finished.
Finished very strong and as we look ahead, we feel confident that we're going to grow high teens.
As we look at it internationally the rest of the year.
Great Thanks, and congrats again on the quarter.
Thank you.
Thank you David.
One moment for our next question.
Our next question comes from Sam Darnel from BTG. Please go ahead.
Actually I think this is Ryan on for.
Yes.
Sorry, we got our lines crossed.
So.
Couple of things there for me.
Couple of questions. So number one.
You guys had a great quarter.
Competitively, where do you think youre, taking share from and is there any concern that youre taking from the.
The asset that you may be buying and just.
How can you reassure investors that you are not kind of.
Just spin any and in your wheels, I guess from a share perspective there.
Hey, Ryan it's Dan.
It's a great question and that would certainly be ironic. So I would tell you that while we don't share that level of detail, especially right now through the planning phase I would say that our share gains really come again in a market appropriate way. So you look at kind of how you ticked down with the big guys being in Medtronic J&J Stryker I still feel like Thats, where most of that.
That will come from certainly to the best of my knowledge, we've never been.
Our strong at taking share from new base of we've always tended to kind of go after the market and run in parallel versus really heavily compete against each other happens occasionally, but I would say, it's more rarely than a fact.
Okay, and then Keith SG&A was a bit higher than we expected this quarter.
And I just want to understand kind of where you are.
One why is it up so much and kind of how you think about it for the balance of the year.
Yes, so SG&A definitely was up a little bit more than we expected in the quarter as well I commented on sales training being higher as well as some travel we had our global sales meeting in Q1. This year last year, we had it later in the year because of Covid. So there is a little bit of timing slip year over year and then just generally speaking we're out there pounding the street with from our meetings perspective, but most importantly.
<unk> sales comp was up really driven by.
Achieving quota as well as the.
The growth of the sales force from competitive recruiting in the past as we look as we look ahead this should balance out a bit but on a full year basis, I would say that it feels a little bit it feels like it will be a little bit higher but it doesn't change. The fact that we still think of our mid Thirty's EBITDA company.
Okay I'll hop back in queue. Thanks, Ben Garner thanks. Thanks.
Thank you Ryan.
Well remember for our next question.
Our next question comes from Richard newer to <unk>.
From <unk> Securities. Please go ahead.
Hi, This is Sam on for rich Thanks for taking our question.
The first one I'll ask.
On robotics did you see any greater mix of competitive accounts.
This quarter than <unk> seen with placements in the past.
Yes, we have we've seen that we're making inroads beyond just the globus friendly's and I think that's a trend we've seen for a while but certainly in this past quarter.
Great. Thanks, and then can you parse out at all in the hanging versus robotics, how are you.
Think about the mix of that through this year that'd be great. Thanks.
No. Thanks, Sam but now we're not parsing out imaging versus robotics that we look at our enabling tech we're going to continue to bring a suite of products to the market.
It's another SKU within that portfolio.
Okay.
Got it thank you.
Thank you.
One moment for our next question.
Our next question comes from Kyle Rose from Canaccord. Please go ahead.
Great. Thank you for taking the questions.
Just wonder if you could talk a little bit more about the trauma business I mean, it seems like it's kind of hitting.
A bit of an inflection point here.
You clearly have the manufacturing and scale to be able to probably flex inventory a little bit higher there. So just wondering what realistically we should expect to see some sort of hockey stick or a larger step up from a.
From a growth perspective, if thats building out additional territories and things of that sort of is there any expectation to kind of push the gas pedal down so to speak here.
Thanks, Kyle it's Dan I was kind of thinking 57% was putting my foot down on the gas, but I kind of get it. We can certainly go deeper what I would tell you. It's a factor of right now is the recruiting and the continuation of adding set so I think we've got a bag very capable of level, one level, two trauma centers and going through and.
I think we're seeing that growth come from there so.
I would tell you I'm not overly concerned we are investing in it there's nothing related to the pending new.
Acquisition or merger that would actually impact trauma as you know we fund it and run it completely separately so.
I'll tell you what I will take that back and see if I can beat it for Q2 as we continue to drive into the market.
Great.
It's our job to ask what's next.
On the competitive rep hiring I guess, just maybe from a high level I mean, how have those discussions changed.
The non <unk> non G med type of reps now that you are.
And the public you were talking about this this future marriage.
Is there any difference in the type of reps that might be interested in a broader combined portfolio just help us understand how those conversations are trending.
Yes, it's a great question I would say that the conversation is slightly different but you still have obviously a mix of folks I wouldn't say I'm able to categorize them as a particular type.
I do know that as people, including Wall Street really understand the potential of this deal and what this company can do long term, you're really looking at individuals who want to grow and who want to make a difference and thats really who is coming to the door and saying how do I become part of this they know we're going to invest in these portfolios, but we're going to drive this forward.
And we're going to continue to invest and expand in and so those folks interested in being part of that story and actually realizing that are the ones from all different levels coming to us and asking to help join the team.
Okay.
Thank you.
One moment for our next question and Ed.
As a reminder, if you want to ask a question. Please press star one one on your telephone.
One moment.
Our next question comes from Matt Taylor from Jefferies.
Please go ahead.
Hi, Dan and Keith This is Mike on for Matt Tonight, Thanks for taking my questions.
Just first.
You talked about a robust.
The robot pipeline entering <unk>. So it doesn't seem like you're seeing any any capital spend hesitancy among customers, but just can you talk about how youre thinking about potential macro headwinds and the potential impact on customer capital spending.
I'd say the Max this is Keith I'll take this and Dan you can fill in but.
The market is definitely dynamic last year, we were talking about a robotic pipeline that didn't mature in the U S and coming into Q4 and into Q1. It was anything but that we had a really strong pipeline lots of demand lots of really opportunity chasing for the for the sales team.
As we look towards the rest of the year I still think we have to continue to sell the technology I mentioned earlier that where we are at a place where more and more robots are being adopted and I think as time passes.
Call It an inflection point you see that.
Other facilities, one would want to get on it.
Dr Robotic technology.
I think we have to continue to sell those benefits as we walk into the macroeconomic headwinds and I think and as we do that we again have multiple ways to sell the robot the majority of our sales or outright purchases, but there's other ways that we can we can sell robots and meet competition with volume based arrangements.
And things of that nature. So I think that we are ready to respond to the market depending.
Depending on what happens Macroeconomically.
And I'll just build on that Mike certainly the last three years have been more than a training ground for difficult times, whether you get into COVID-19 or post COVID-19 without staffing or nurses on and on so again I think like anything putting this technology into the hands of surgeons to make a difference will remain top priority and as Keith said multiple approaches.
That work with the customer in a way to get that out there something we'll keep in mind, especially if we're about to walk into a recession, we have to be mindful of what that can do but not deny technology to people, who can really change lives.
Got it that's helpful. And then just the follow up there you mentioned U S kind of coming out of 2022 can you talk about any differences that you see U S versus O U S. Just in terms of robotic demand in customer purchasing behavior, and how youre thinking about that trajectory through 2023.
Yeah.
Yes, I would say it really just depends market by market right again, youre still nascent in the U S with a lot of ways to penetrate and grow again, depending on where you are through the world. There's different uptake that we're starting to see I wouldn't necessarily say there is an over focus of where to go or how to do it differently right. Now, it's just about an education and awareness hands on training.
<unk> and then working with folks to get the technology into their or.
Okay. Thank you.
Thank you.
Thank you.
One moment for our next question.
Our next question comes from Vik Chopra from Wells Fargo Wells Fargo. Please go ahead.
Hey, good afternoon, and thanks for taking the questions and I'll Echo my congratulations as well. So two for me first one can you provide an update on the recon robotics.
Programming with the latest timelines are.
Hey, Vic its Dan, yes, I'll be glad to do that we're still progressing through we have not yet filed we're in testing for a lot of things when it comes into electronic equipment. We're working through those now actually just had a meeting today about how you scale up and get ready for the launch so I don't have a date to give you.
Just yet because we need to get through the testing in order to do the filing to get this approved not seeing anything that is a concern just a matter of working through it certainly a goal if all went well with the potential to see this by year end.
And that's what we're going to push towards for right now.
Great and then just one more follow up I mean, obviously very strong.
Trends in your robotics business, one of the larger orthopedic competitors has talked about coming out with the spine robot in 2024 and I'm. Just curious if you have seen anything change in the competitive landscape and whether you expect any impact in 2023 to your ability to continue to sell <unk>.
<unk> systems.
Yeah. Thanks, So I would say, we're not really as you remember when we came out with this we always knew that we were one of the first and that the market will continue to have entrance and get eventually more crowded so theres nothing of concern of shock.
We're not talking to customers, who are thinking about what could happen in 24 months right now they're understanding what the technology as they recognize ours as the best and so we will continue to go ahead and push with that and continue to look and add options and offerings to our platform that's going to even create more value for our customers.
Okay.
Alright, thank you.
With no further questions. This concludes the Globus medical first first quarter earnings call. Thank you for joining us today and have a nice evening, we will now disconnect.
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