Q1 2024 Penumbra Inc Earnings Call

Ellie: Good afternoon. My name is Ellie, and I will be your conference operator for today. At this time, I would like to welcome everyone to Penumbra's first quarter 2024 conference call. All lines have been placed on mute to prevent any background noise.

Good afternoon. My name is Sally and I will be your conference operator for today at this time I would like to welcome everyone to opinion best first quarter 'twenty 'twenty four conference call all lines have been placed on mute to prevent any background noise.

Ellie: After the speaker's remarks, there will be a question and answer session. If you'd like to ask a question during this time, simply press the star followed by the number one on your telephone keypad. If you would like to withdraw your question, press the pound key. Thank you. I would like to introduce Ms. Cecilia Furlong, Business Development and Investor Relations for Penumbra. Ms. Furlong, you may now begin your presentation.

Cecilia Furlong: Speakers remarks, there will be a question and answer session.

Cecilia Furlong: You'd like to ask a question. During this time simply press star followed by the number one on your telephone keypad. If he would like to withdraw your question press the pound. Thank.

Ellie: Thank you I would like to introduce MS. Cecilia furlong business development and Investor Relations for opinion there. Mr. Long you may now begin your conference.

Cecilia Furlong: Thank you, operator, and thank you all for joining us on today's call to discuss Penumbra's earnings release for the first quarter of 2020. A copy of the press release and financial tables, which includes a gap to non-gap reconciliation, can be viewed under the Investors tab on our company website at www.penumbrainc.com. During the course of this conference call, the company will make forward-looking statements pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including statements regarding financial performance, commercialization, clinical trials, regulatory status, quality, compliance, and business trends.

Cecilia Furlong: Thank you operator, and thank you all for joining us on today's call to discuss the numbers earnings release for the first quarter of 'twenty 'twenty four and a copy of the press release and financial tables, which includes a GAAP to non-GAAP reconciliation can be viewed under the investors tab on our company website at Www Dot Penumbra, Inc.

Cecilia Furlong: Dot com.

Cecilia Furlong: During the course of this conference call. The company will make forward looking statements pursuant to the Safe Harbor provisions of the private Securities Litigation Reform Act of 1995, including statements regarding our financial performance commercialization clinical trials regulatory status quality compliance and business trends.

Cecilia Furlong: Actual results could differ materially from those stated or implied by our forward-looking statements due to certain risks and uncertainties, including those referenced in our 10-K for the year ended December 31, 2023, filed with the SEC. As a result, we caution you against placing undue reliance on these forward-looking statements, and we encourage you to review our periodic filings with the SEC, including the 10-K previously mentioned, for a more complete discussion of these factors and other risks that may affect our future results or the market price of our stock.

Cecilia Furlong: Actual results could differ materially from those stated or implied by our forward looking statements due to certain risks and uncertainties, including those referenced in our 10-K for the year ended December 31st 2023 filed with the SEC as a result, we caution you against placing undue reliance on these forward looking.

Cecilia Furlong: Statements and we encourage you to review our periodic filings with SEC, including the 10-K previously mentioned for a more complete discussion of these factors and other risks that may affect our future results or the market price of our stock penumbra disclaims any duty to update or revise our forward looking statements as a result of new.

Cecilia Furlong: Penumbra disclaims any duty to update or revise these forward-looking statements as a result of new information, future events, developments, or otherwise. On this call, financial results for revenue and gross margin are presented on a GAAP basis, while operating expenses, operating income, and adjusted EBITDA are presented on a non-GAAP basis. The corresponding GAAP measures and a reconciliation of GAAP to non-GAAP financial measures are provided in our posted press release. Non-GAAP operating expenses and operating income exclude amortization of acquired intangible assets of $2.4 million in the first quarter of 2024 and 2023 and $4.8 million of non-recurring litigation-related expenses, including settlement costs and legal fees associated with wage and hour complaints filed against the company in 2023 in the first quarter of 2024. An adjusted EBITDA excludes such non-recurring litigation-related expenses and stock compensation expenses.

Cecilia Furlong: New information future events developments or otherwise.

Cecilia Furlong: On this call financial results for revenue and gross margin are presented on a GAAP basis operating expenses operating income and adjusted EBITDA are presented on a non-GAAP basis, the corresponding GAAP measures and a reconciliation of GAAP to non-GAAP financial measures are provided in our posted press release non.

Cecilia Furlong: GAAP operating expenses and operating income exclude amortization of acquired intangible assets of $2 4 million in the first quarter of 2024, and 2023 and $4 8 million nonrecurring litigation related expenses, including settlement costs and legal fees associated with wage and hour complaints filed against.

Cecilia Furlong: The company in 2023 in the first quarter 2024, and adjusted EBITDA excludes such nonrecurring litigation related expenses and stock compensation expense I don't know Fisher numbers, Chairman and CEO will provide a business update Maggie Yuen, our Chief Financial Officer will then discuss our financial results for the for.

Cecilia Furlong: Adam Elsesser, Penumbra's Chairman and CEO, will provide a business update. Maggie Yuen, our Chief Financial Officer, will then discuss our financial results for the first quarter of 2024. And Jason Mills, our Executive Vice President of Strategy, will discuss our 2024 guidance. With that, I would like to turn the call over to Adam Elsesser.

Cecilia Furlong: Quarter of 2024, and Jason knows our executive Vice President of strategy will discuss our 2024 guidance with that I would like to turn the call over to Adam Elsesser.

Adam Elsesser: Thank you, Cecilia. Good afternoon.

Adam Elsesser: Thank you Cecilia good afternoon. Thank you for joining <unk> first quarter 2024 conference call.

Adam Elsesser: Thank you for joining Penumbra's first quarter 2024 conference call. Our total revenues for the first quarter were $278.7 million, a year-over-year increase of 15.4% as reported and 15.2% on a constant currency basis. Our U.S. thrombectomy revenue grew 35.2% compared to the same quarter a year ago to $150.3 million, driven by continued strong market growth and share gains with Lightning Flash and Lightning Bolt 7. International thrombectomy revenue also exceeded our expectations in the first quarter, growing 10.7% year-over-year against a challenging comparison last year.

Maggie S. Yuen: Our total revenues for the first quarter were $278 $7 million a year over year increase of 15, 4% as reported and 15, 2% on a constant currency basis. Our U S. Thrombectomy revenue grew 35, 2% compared to the same quarter a year ago.

Adam Elsesser: $253 million driven by continued strong market growth and share gain with lightning flash and lightning bolt seven.

Adam Elsesser: International Thrombectomy also exceeded our expectations in the first quarter growing 10, 7% year over year against a challenging comparison last year.

Adam Elsesser: Overall, we had a strong start to the year and see positive trends in our core markets and our business with our computer-assisted vacuum thrombectomy products in VTE and arterial and market-leading portfolio in stroke. This reinforces our confidence we can deliver strong growth of 27 to 30 percent in U.S. thrombectomy and 16 to 20 percent overall in 2024. In addition to our commitment to strong revenue growth, we're also focused on margin expansion and increasing profitability.

Adam Elsesser: Overall, we had a strong start to the year and see positive trends in our core markets and our business with our computer assisted vacuum turned back to meat products N V T and arterial and market leading portfolio in stroke. This reinforces our confidence we can deliver strong growth of 27.

Adam Elsesser: 30% in U S thrombectomy, and 16% to 20% overall in 2024.

Adam Elsesser: In addition to our commitment to strong revenue growth. We're also focused on margin expansion and increasing profitability. We are ahead of schedule to deliver 100 to 150 basis points of gross margin margin expansion in 2024 and are confident we can increase our gross margins.

Adam Elsesser: We are ahead of schedule to deliver 100 to 150 basis points of gross margin expansion in 2024 and are confident we can increase our gross margins to more than 70% within the next 24 to 30 months. We are also on track to deliver at least 100 to 200 basis points of operating margin expansion this year, inclusive of investments we are making in our U.S. commercial team and market access initiatives, both of which should help us sustain strong growth into the future. Operating income in the first quarter was $19.3 million, representing 6.9% of revenue, increasing 260 basis points over the same period a year ago.

Adam Elsesser: More than 70% within the next 24 to 30 months.

Adam Elsesser: We're also on track to deliver at least 100 to 200 basis points of operating margin expansion. This year inclusive of investments we are making in our U S commercial team and market access initiatives, both of which should help us sustained strong growth into the future.

Adam Elsesser: Operating income in the first quarter was $19 $3 million, representing six 9% of revenue increasing 260 basis points over the same period a year ago looking forward, we expect our operating margin expansion to outpace gross margin expansion for the <unk>.

Adam Elsesser: Looking forward, we expect our operating margin expansion to outpace gross margin expansion for the foreseeable future. Notwithstanding the strong growth we have seen in U.S. thrombectomy over the past few years, a clinically significant clot burden is still one of the most under-treated acute issues in health care today. We are well positioned to expand access to CABT and make the treatment of these patients safer, simpler, and faster, which we strongly believe and are committed to continually proving accrues to the benefit of patients, physicians, and hospitals.

Adam Elsesser: Our Seattle future.

Adam Elsesser: Notwithstanding the strong growth we've seen in U S. Thrombectomy over the past few years clinically significant clot burden is still one of the most undertreated acute issues in health care today.

Adam Elsesser: We are well positioned to expand access to see a b T and make the treatment of these patients safer simpler and faster.

Adam Elsesser: Which we strongly believe and are committed to continually prove accrues to the benefit of patients physicians and hospital systems.

Adam Elsesser: Over the past several quarters, we have delineated our strategy to deliver outsized revenue growth in thrombectomy over the near, medium, and long term through a combination of continued innovation with our CABT platform, optimizing our commercial team in both the U.S. and international markets, and developing robust clinical and health economics evidence for our CABT products. With this collective work, we are confident we will continue to catalyze adoption of CAVT and drive utilization among the majority of the 1.25 million applicable clot patients in the United States each year across the five vascular beds we address today. We fully launched Lightning Flash 2.0 in late April on the heels of outstanding outcomes from the evaluation cases done in early April. Flash 2.0 is proving in practice what we saw on the bench.

Adam Elsesser: Over the past several quarters, we have delineated our strategy to deliver outsized revenue growth and thrombectomy over the near medium and long term through a combination of continued innovation with our C. A P T platform.

Adam Elsesser: <unk>, our commercial team in both the U S and international markets and developing robust clinical and health economic evidence on our C. A b T products with this collective work. We are confident we will continue to catalyze adoption of C. A T and drive utilization to the majority of the.

Adam Elsesser: 1.25 million applicable clot patients in the United States each year across the five vascular beds, we address today.

Adam Elsesser: We fully launched lightning flashed 2.0 in late April on the heels of outstanding outcomes from the evaluation cases done in early April.

Adam Elsesser: Just to point out is proving in practice, what we saw on the bench the product further optimizes the advantages of C. A T. N V. T. E. We are seeing pent up demand for flash to point out and coupled with the larger commercial team we've developed over the past two quarters, our U S. Thrombectomy business is.

Adam Elsesser: The product further optimizes the advantages of CAVT in VTE. We are seeing pent-up demand for Flash 2.0, and coupled with the larger commercial team we've developed over the past two quarters, our U.S. thrombectomy business is in a strong position to continue to catalyze growth for us in these markets this year and beyond. We're also seeing meaningful progress within our innovation pipeline and are on track to launch three additional CAVT products within the next 12 months, at least one of which we expect before the end of 2024.

Adam Elsesser: In a strong position to continue to catalyze growth for us in these markets this year and beyond.

Adam Elsesser: We're also seeing meaningful progress within our innovation pipeline and are on track to launch three additional C. A b T products within the next 12 months at least one of which we expect before the end of 2024.

Adam Elsesser: Overall, we are committed to continued innovation to augment the utility and reach of CAVT head-to-toe. In addition to VTE and arterial, stroke will be the next vascular bed we address with CABT. Enrollment in our Thunder Study is going very well, and we are very encouraged by outcomes and physician engagement. We now hold nearly 60% market share in the U.S. stroke market and expect to gain more share through 2024, ahead of a breakthrough, which will further extend our leadership position.

Adam Elsesser: Overall, we are committed to continued innovation to augment the utility and reach of C. A b T head to toe.

Adam Elsesser: In addition to V T E and arterial stroke could be the next vascular bed, we address with C. A b T.

Adam Elsesser: Enrollment in our Thunder study is going very well and we are very encouraged by outcomes and physician engagement.

Adam Elsesser: We now hold nearly 60% market share in the U S stroke market and expect to gain more share through 'twenty 'twenty four ahead of a thunderbolt lunch.

Adam Elsesser: Which will further extend our leadership position.

Adam Elsesser: We're also seeing more energy and engagement from large healthcare systems seeking to work with us as the industry leader on ways to further extend interventional stroke care to many more patients within their network. Our proprietary technology portfolio in stroke, our reputation in the field, and our scale give us the unique ability to do this work with healthcare systems going forward. I'll now turn the call over to Maggie to go over our financial results for the first quarter of 2024.

Adam Elsesser: We're also seeing more energy and engagement from large health care systems seeking to work with us as the industry leader on ways to further extend intervention stroke care to many more patients within their networks.

Maggie: Our proprietary technology portfolio and stroke, our reputation in the field.

Maggie: And our scale gives us the unique ability to do this work with health care systems going forward.

Adam Elsesser: I'll now turn the call over to Maggie to go over our financial results for the first quarter of 2024.

Maggie S. Yuen: Thank you, Adam. Good afternoon, everyone.

Maggie: Thank you Adam good afternoon, everyone today, I will discuss the financial results for the first quarter of 2024.

Maggie S. Yuen: Today, I will discuss the financial results for the first quarter of 2024. As a reminder, revenue and gross margin are presented on a gap basis, while operating expenses, operating income, and adjusted EBITDA are presented on a non-gap basis. The corresponding GAAP measures and our reconciliation of GAAP to non-GAAP financial measures are provided in our post-depression release.

Maggie: As a reminder, financial results on this call for revenue and gross margin on a GAAP basis, while operating expenses operating income and adjusted EBITDA, a non-GAAP basis.

Maggie S. Yuen: The corresponding GAAP measures and a reconciliation of GAAP to non-GAAP financial measures are provided in our posted press release.

Maggie S. Yuen: For the first quarter ended March 31st, 2024, our total revenues were $278.7 million, an increase of 15.4% reported and 15.2% in constant currency compared to the first quarter of 2023. Our geographic mix of sales for the first quarter 2024 was 75.2% U.S. and 24.8% international. Our U.S. business reported growth of 22 percent, driven by 35.2 percent growth in our thrombectomy franchise. Our international regions declined a modest 0.7 percent, reflecting a decline in our overall embolization and excess product revenue offset by growth in thrombectomy volume in Europe, APAC, Canada, and Latin America.

Maggie S. Yuen: For the first quarter ended March 31, 2024 hour total revenues were $278 $7 million, an increase of 15, 4% reported and 15, 2% in constant currency compared to the first quarter of 2023 hours.

Maggie S. Yuen: Our geographic mix of sales for the first quarter 2024 was 75, 2% in U S and 24, 8% International.

Maggie S. Yuen: Our U S reported growth of 22% driven by 35, 2% growth in us thrombectomy franchise.

Maggie S. Yuen: Our international regions declined a modest <unk>, 7%, reflecting declines in our overall embolization and access product revenue offset by growth in thrombectomy broadly and in Europe, APAC, Canada and Latin America.

Maggie S. Yuen: Moving to revenue byproducts. Revenue from the global thrombectomy business grew to $187.7 million in the first quarter of 2024, an increase of 29.5% reported and 29.3% in constant currency compared to the same period last year. Our U.S. growth of 35.2% and international growth of 10.7% compared to the same period last year reflects strong momentum in CABT products.

Maggie S. Yuen: Moving to revenue by products revenue from global come back to me business grew to $187 $7 million in the first quarter of 2024, an increase of 29, 5% reported and 29, 3% in constant currency compared to the same period last year.

Maggie S. Yuen: Our U S growth of 35, 2% and international growth of 10, 7% compared to the same period last year reflects strong momentum in CABG products.

Maggie S. Yuen: Revenue from our embolization and access business was $91 million in the first quarter of 2024, a decline of 5.7% reported and 6% in constant currency, primarily driven by an overall decline in the international market. Turning to Gross Margin. Growth margin for the first quarter of 2024 was 65%, compared to 62.6% for the first quarter of 2023. We delivered 240 basis point improvements driven by favorable thrombectomy product mix across all regions and strong productivity, partially offset by material cost increases and investment in direct labor capacity for new product launches and higher demand.

Maggie S. Yuen: Revenue from our embolization and access business was $91 million in the first quarter of 2024.

Maggie S. Yuen: Decline of five 7% reported and 6% in constant currency, primarily driven by an overall decline in international markets.

Maggie S. Yuen: Turning to gross margin.

Maggie S. Yuen: Gross margin for the first quarter of 2024 or 65% compared to 62, 6% for the first quarter of 2023.

Maggie S. Yuen: We delivered 240 basis point improvement driven by favorable thrombectomy product mix across all regions and strong productivity, partially offset by material cost increases and investment in indirect labor capacity for new product launches and higher demand.

Maggie S. Yuen: We are on track to deliver 100 to 150 basis point gross margin expansion in 2024.

Maggie S. Yuen: We are on track to deliver 100 to 150 basis points of gross margin expansion in 2024. Now, on to our non-GAAP operating expenses, non-GAAP operating income, and margin, and adjusted EBITDA. Total operating expense for the quarter was $161.8 million, or 58.1% of revenue compared to $170.7 million or 58.3% of revenue for the same quarter last year. Our research and development expenses for Q1 2024 were $24.6 million compared to $20 million for Q1 2023.

Maggie S. Yuen: Now onto our non-GAAP operating expenses, non-GAAP operating income and margin and adjusted EBITDA.

Maggie S. Yuen: Total operating expense for the quarter was 161 $8 million or 58, 1% of revenue compared to $177 million or 58, 3% of revenue for the same quarter last year.

Maggie S. Yuen: Our research and development expenses for Q1, 2024 or 20.

Maggie S. Yuen: $24 $6 million compared to $20 million from Q1 2023.

Maggie S. Yuen: SG&A expenses for Q1 2024 were $137.2 million, or 49.2% of revenue compared to $120.7 million, or 50% of revenue for Q1 2023. With higher seasonality expenditures in the first quarter, we expect continued leverage in our SG&A expenditures as a percentage of revenue. We recorded operating income of $19.3 million, or 6.9% of revenue, in the first quarter of 2024 compared to an operating income of $10.4 million, or 4.3% of revenue, for the same period last year.

Maggie S. Yuen: SG&A expenses for Q1, 2024, with $137 $2 million or <unk> 49, 2% of revenue compared to $120 $7 million or 50% of revenue for Q1 2023.

Maggie S. Yuen: With higher seasonality expenditures in the first quarter, we expect continued leverage in our SG&A expenditures as a percentage of revenue.

Maggie S. Yuen: We recorded operating income of $19 3 million or six 9% of revenue in the first quarter of 2024 compared to an operating income of $10 4 million or four 3% of revenue for the same period last year.

Maggie S. Yuen: We expect to continue operating margin improvements of 100 to 200 basis points throughout 2024.

Maggie S. Yuen: We posted adjusted EBITDA of $37 $6 million or 13, 5% of total revenue compared to 11, 4% in the first quarter last year.

Maggie S. Yuen: Turning to cash flow and balance sheet.

Maggie S. Yuen: We ended the first quarter with cash cash equivalents and marketable security balance of $313 $5 million and no debt.

Maggie S. Yuen: An increase of $24 $3 million, driven by operating profitability and improvements in working capital turns.

Maggie S. Yuen: We expect positive operating cash flow trends to continue in 2024.

Maggie S. Yuen: We expect to continue operating margin improvements of 100 to 200 basis points throughout 2024. We posted adjusted EBITDA of $37.6 million, or 13.5% of total revenue, compared to 11.4% in the first quarter last year. Turning to cash flow and balance sheets, we ended the first quarter with cash, cash equivalents, and a marketable security balance of $313.5 million and no debt. An increase of $24.3 million, driven by operating profitability and improvements in working capital terms. We expect positive operating cash flow trends to continue in 2024. And now I'd like to turn the call over to Jason to discuss our guidance. Thank you, Maggie, and good afternoon, everybody.

Maggie S. Yuen: And now I'd like to turn the call over to Jason to discuss our guidance.

Jason Richard Mills: We then expect growth to accelerate to the high end of our 16 to 20% guidance range or above in the second half of the year. We continue to expect growth in U.S. thrombectomy to be consistently strong in our guidance range throughout the year, and we now expect growth from our international thrombectomy franchise to be slightly stronger than we conveyed on our last earnings call, in the mid to high single-digit range for full year 2024 compared to flat to modest growth conveyed on our last call.

Jason Richard Mills: Thank you, Maggie, and good afternoon, everybody. Strong trends in our U.S. thrombectomy franchise through the first quarter, the recent launch of Lightning Flash 2.0 in the United States, and continued productivity momentum from our expanded U.S. commercial team reinforce our expectation for strong U.S. thrombectomy and total revenue growth of 27% to 30% and 16% to 20%, respectively, for full year 2024. Consistent with the commentary we provided on our earnings call in February, we expect global revenue growth in the first half of the year to be in the mid-teens range, primarily based on currently forecasted orders from our international distributors and the timing of new product launches.

Jason: Thank you Maggie and good afternoon everybody.

Jason Richard Mills: <unk> trends in our U S thrombectomy franchise through the first quarter. The recent launch of Lightning flashed to <unk> in the United States and continued productivity momentum from our expanded U S. Commercial team reinforce our expectation for strong U S thrombectomy and total revenue growth of 27% to 30.

Jason Richard Mills: <unk> percent and 16% to 20% respectively for full year 2024, consistent with the cadence commentary we provided on our earnings call in February we expect global revenue growth in the first half of the year to be in the mid teens range, primarily based on currently forecasted orders from our <unk>.

Jason Richard Mills: <unk> national distributors and timing of new product launches. We then expect growth to accelerate to the high end of our 16% to 20% guidance range or above in the second half of the year. We continue to expect growth in U S thrombectomy to be consistently strong and our guidance range throughout the year and we now.

Jason Richard Mills: I expect growth from our international Thrombectomy franchise to be slightly stronger than we conveyed on our last earnings call mid to high single digit range for full year 2024, compared to flat to modest growth conveyed on our last call for our embolization and access business for the full year we.

Jason Richard Mills: For our embolization and access business, for the full year, we expect mid-single-digit growth in the U.S. and flat internationally. That said, we expect year-over-year growth rates for both U.S. and international imbolization and access. Lastly, we continue to expect strong expansion in both gross margin and operating margin in 2024. We reiterate our guidance for a 100 to 150 basis points expansion in gross margin and 100 to 200 basis points expansion in operating margin. [inaudible] Operator, we can now open the call to questions.

Jason Richard Mills: <unk> mid single digit growth in the U S and flat internationally that said, we expect year over year growth rates for both U S and international Embolization and access businesses to strengthen throughout the year to the low teens range by the fourth quarter from new product launches and increasing productivity from our larger commercial.

Jason Richard Mills: Actual team.

Jason Richard Mills: Lastly, we continue to expect strong expansion in both gross margin and operating margin in 2024, we reiterate our guidance for 100 to 150 basis points expansion in gross margin and 100 to 200 basis points expansion in operating margins each quarter on a year over year basis.

Jason Richard Mills: As well as for the full year.

Jason Richard Mills: Operator, we can now open the call to questions.

Jason Richard Mills: Okay.

Jason Richard Mills: Sure.

Ellie: We are now opening the floor to questions-and-answers. At this time, I would like to remind everyone, in order to ask a question, press star, then the number 1 on your telephone keypad. We'll pause for a brief moment to compile the Q&A route. Your first question comes from Margaret Hafsord on behalf of William Blair. Your line is now open.

Speaker Change: We are now opening the floor for a question and answer session. At this time I would like to remind everyone in order to ask a question Press Star then the number one on your telephone.

Speaker Change: We will foster a woman to compile the Q&A roster.

Ellie: Yeah.

Malgorzata Maria Kaczor Andrew: Your first question comes from Margaret <unk>.

Malgorzata Maria Kaczor Andrew: <unk> resort.

Malgorzata Maria Kaczor Andrew: William Blair. Your line is now open.

Malgorzata Maria Kaczor Andrew: Hey, good afternoon, folks. Thanks for taking the time to answer the question. Yeah, I maybe wanted to ask first on some of the comments around optimizing the sales team, both the UFs, and no UFs. Obviously, thrombectomy growth in both markets seems like it's picking up nicely and maybe a little bit stronger, frankly, than what we experienced. So how much of it is that? How much of it is around current market growth and some of the continuation of what you saw last year? And specifically, what metrics are you focused on with regard to those investments? Is it geography? Is it guaranteed market access? Where are you focused?

Malgorzata Maria Kaczor Andrew: Hey, good afternoon folks thanks for taking my question.

Speaker Change: Yes, I, just maybe wanted to ask.

Malgorzata Maria Kaczor Andrew: First just on.

Malgorzata Maria Kaczor Andrew: Some of the comments around optimizing sales team both the U S. Now contemplate thrombectomy growth in both market seems like it's picking up nicely.

Malgorzata Maria Kaczor Andrew: And maybe a little bit stronger frankly than what we experienced so how much of it is that.

Malgorzata Maria Kaczor Andrew: How much of it is that around.

Malgorzata Maria Kaczor Andrew: Current market growth in some of the continuation of what you saw last year.

Malgorzata Maria Kaczor Andrew: And specifically what metrics are you focused on.

Malgorzata Maria Kaczor Andrew: With regards to those investments.

Malgorzata Maria Kaczor Andrew: It geographies is it certain market access where are you focused on.

Adam Elsesser: It's a great series of questions, Margaret. Let me try to break it down and remind everyone, philosophically, we typically hire behind our growth, you know, sort of not ahead of our growth, and I think people have known that. And so we were looking last year at a huge demand for the new CAVT platform, and we just didn't have enough people, and we brought them on late in the year, got them up and going, and added some more in the first quarter.

Speaker Change: It's a great series of questions Margaret Let me, let me try to.

Adam Elsesser: Break it down in and remind everyone philosophically, we typically hire behind our growth sort of not ahead of our growth and I think people have known that.

Adam Elsesser: And so we were looking at last year with a huge demand for the new <unk> platform and we just didn't have enough people and we brought them on late in the year got them up and going added some more in the first quarter. So we.

Adam Elsesser: So this quarter wasn't really the product of a lot of the new people. But they're now in place going forward for the second, third, and fourth quarters. And so what really is driving the growth in the first quarter is really just the work that we laid out all of last year around both Lightning Flash and Lightning Bolt and how good they are and how many people are experiencing them and trying them and continuing to do so. Obviously, we talked about April being the quarter that we started to do Flash 2.0 cases, so that's not in the first quarter number. That's obviously yet to come.

Adam Elsesser: The benefit this quarter wasn't really the product of.

Adam Elsesser: A lot of the new people there. They are now in place going forward for the second third and fourth quarter.

Adam Elsesser: And so what really is driving the growth in the first quarter is really just the the work that we laid out all of last year around both lightning flash and lightning bolt in and how good they are and how many people are are.

Adam Elsesser: Experiencing them and trying them and continuing to do it obviously.

Adam Elsesser: We talked about April being the quarter that we started to do flashed two point no cases, so so that's not in the first quarter number.

Adam Elsesser: That's yet to come obviously.

Malgorzata Maria Kaczor Andrew: Okay. And, you know, as it relates to guidance, obviously, a great quarter again. So I'll push on that a little bit more, you know, especially for you at FormVectomy. You're on the high end of the range, obviously an easier comp in the first quarter.

Speaker Change: Okay, and you know as it relates to guidance and obviously, a great quarter again, I'll push on that a little bit more especially for U S and that to me you.

Malgorzata Maria Kaczor Andrew: You are on the high end of the range, obviously, an easier comp in the first quarter.

Speaker Change: So I get that from that perspective, but on the same token you have these commercial.

Jason Richard Mills: So I get that from that perspective. But on the same token, you have these commercial, you know, investments that you're making that should ramp up. And we're also going to see some data that maybe helps the entire market grow a little bit as we go on throughout the year. Why shouldn't we continue to expect things there, if not even accelerate a little bit?

Jason Richard Mills: Investments that youre, making that should ramp up here I'll sell you know we're going to see some data that maybe helps the entire market grow a little bit as we go on throughout the year why shouldn't we.

Jason Richard Mills: Continue to expect things.

Jason Richard Mills: Or if not even accelerating a little bit.

Jason Richard Mills: Yeah, Margaret, it's a great question as our current guidance obviously reflects faster growth as the year progresses. We've taken that into account, and this quarter's strong start reinforces our confidence in our business. And our guidance, in particular, our U.S. thrombectomy guidance for the full year, reflects both that strength and the momentum from our products and our commercial team. So I think we're in pretty good shape as we think about how the year unfolds. The next question comes from Jillian Lynch from Citi. Your line is now open. Good evening, and thank you for taking the question.

Speaker Change: Yes, Margaret it's a great question.

Jason Richard Mills: Our current guidance, obviously reflects already a faster growth as the year progresses, we've taken that into account.

Jillian Lynch: And this quarter's strong start.

Jillian Lynch: Reinforces our confidence in our business and our guidance and particularly our U S. Thrombectomy guidance for the full year reflects both that strength and the momentum from our products and our commercial team. So I think we're in pretty good shape.

Jillian Lynch: As we think about how the year unfolds.

Jason Richard Mills: Yeah.

Jillian Lynch: Okay. Thanks.

Jillian Lynch: The next question comes from Jillian Lynch from Citi. Your line is now open.

Jillian Lynch: Thank you.

Jillian Lynch: The next question comes from Julian Lynch from Citi. Your line is now open.

Jillian Lynch: Good evening and thank you for taking the question.

Jillian Lynch: Two questions really.

Jillian Lynch: Sales.

Jillian Lynch: It looks like they are improving are expected to improve throughout the year could you please sort of.

Jillian Lynch: Remind us why that may be and then my second question has to do with that margin.

Jillian Lynch: It sounds like you have a little bit more of an increased focus on gross and operating margins and can you. Please outline not just gross margin, but throughout the income statement what levers do you have to Paul to get there. Thank you.

Jason Richard Mills: Yeah, Margaret, or Johanna, I'm sorry, it's Jason. I'll take the first one, and then Maggie and Adam can take the second one, if that's okay.

Jillian Lynch: Yes, Margaret Joanne I'm, sorry, it's Jason I'll take the first one and then Maggie and Adam can take the second one if that's okay.

Jason Richard Mills: The international cadence typically does escalate as the year goes on. We also have in Europe, taking that, for example, our newest red stroke products are just being launched there. And so you can imagine the pace of that will, we expect, improve. And then in the second half of the year, we think in Europe, they're going to get the new CAVT portfolio. In addition to that, around the world, the timing of international orders, as we've talked about, we have pretty good visibility into. So that's why the guidance, the comprehensive guidance, sort of reflects that cadence for total revenue throughout the year. Yeah, and in terms of our operating margin focus,

Jillian Lynch: The international cadence typically does escalate as the year goes on we also have.

Jason Richard Mills: In Europe, taking that for example, our newest red stroke products are just being launched there.

Jason Richard Mills: So you can imagine the cadence of that will we expect to improve and then.

Jason Richard Mills: In the second half of the year, we think in Europe, they're going to get the new CVT portfolio.

Jason Richard Mills: In addition to that around the world the timing of international orders as we've talked about we have pretty good visibility into so that's why.

Jason Richard Mills: The guidance the comprehensive guidance sort of reflects that that cadence for total revenue throughout the year Meg yeah and in terms of our operating margin focused I.

Maggie S. Yuen: Yeah, and in terms of our operating margin focus, I mean, in addition to the product mix improvement that you see in gross margin, on the operating side, I mean, a lot of the G&A infrastructure investment that we made in the last couple of years will continue to see scalability and, frankly, across all SG&A areas.

Maggie S. Yuen: I mean in addition to the product mix improvement that you see in gross margin on the operating side I mean, a lot of the G&A infrastructure investment that we made in the last couple of years, we will continue to see.

Maggie S. Yuen: Scalability and frankly across all SG&A area.

Speaker Change: Excellent. Thank you.

Speaker Change: Thank you.

William John Plovanic: Our next question comes from Bill Plovanic of Canaccord Genuity Fund. Your line is now open.

Maggie S. Yuen: Our next question comes from Bill <unk> from Canaccord King Mchugh. Your line is now open.

William John Plovanic: Great, thanks for taking my question. Good evening.

William John Plovanic: Great. Thanks for taking my question good evening.

William John Plovanic: So just on the U S thrombectomy market. It seems we get a lot of questions on this obviously a big driver for you I was wondering if you could help just parse out how much of that growth is BT EE versus arterial and then how much of this is <unk>.

Adam Elsesser: So just on the US thrombectomy market, it seems we get a lot of questions on this, obviously a big driver for you. I was wondering if you could help just parse out how much of that growth is VTE versus arterial? And then how much of this is ASP versus just pure volume driven? Because, you know, my understanding is that you haven't gotten an ASP boost over the last year. And just trying to understand just a little more granularity if we can. Thanks. I appreciate it.

Adam Elsesser: Asps versus just pure volume driven because my understanding is you have been getting an ASP boost over the last year and just trying to understand.

Adam Elsesser: Just a little more granularity if we could thanks I appreciate it.

William John Plovanic: Yeah, I think it's a great question. Let me try to give some color to it.

Adam Elsesser: Yes.

Speaker Change: I think it's a it's a great question.

Speaker Change: Let me try to give some color to it.

Adam Elsesser: Obviously, our CABT products drove most of that growth with flash, continuing to take share and catalyze new adoption. Bolt also continued to perform well on the arterial side. Also, our stroke business had really strong growth sort of within our guidance range that we've given as stroke continues to see significant gains, and we expect that to continue. If I would sort of, you know, think about it, last year there was some mix between price and volume, obviously, but now we're anniversarying that, you know, that happened. We launched Flash at the end of, at the beginning of 2023, so almost all of this is new business, It's really business both as the market continues to grow and we accelerate adoption, and, of course, some shared.

Speaker Change: Obviously, our CBD products drove most of that growth with flash.

Adam Elsesser: You can take share and catalyze new adoption.

Adam Elsesser: <unk> also continued to perform well on the arterial side.

Adam Elsesser: Also our stroke business had really strong growth.

Adam Elsesser: Sort of within our guidance range.

Adam Elsesser: That we've given is stroke continues to see significant gains and we expect that to continue.

Adam Elsesser:

Adam Elsesser: If I would sort of think about it.

Adam Elsesser: Last year, there was some mix between price and volume, obviously, but now we're anniversarying that that happened we launched flash at the end of the beginning of last.

Adam Elsesser: 2023 so.

Adam Elsesser: Most all of this is new business.

Adam Elsesser: And price isn't really reflective in.

Adam Elsesser: The growth number it's really business both as the market continues to grow and we catalyze adoption and of course some share gains.

Adam Elsesser: Great. And if I could just on the litigation expense, $4.8 million. You backed it out. Just kind of curious what that was. Is it one-time in nature, or is that going to occur for a couple more quarters? I don't know if it's ongoing litigation. Any help for us to understand and how we should think about that. Thanks. Sure. It's a great question.

Speaker Change: Great and if I could just on the.

Adam Elsesser: Litigation expense $4 8 million you backed it out just kind of curious what that was is it one time in nature or is that going to occur for a couple more quarters I don't know if it's ongoing litigation just any help for us.

Speaker Change: How we should thinking about that thanks.

Adam Elsesser: Sure, it's a great question. As you know, we manufacture all of our products here in California. California, like every state, has wage and hour laws. However, California has an additional aspect of private attorney general action, which can sometimes make those laws complicated. We believe very strongly that we have run and followed the rules. There were some technical violations, and we settled those claims pretty quickly on a scale. This is a one-time settlement. This covers it all, and we can move on to making our products and doing the things that matter the most.

Adam Elsesser: Sure.

Speaker Change: Great question.

Speaker Change: As you know we manufacture for them.

Adam Elsesser: All of our products here in California, California, like every state has wage and hour laws.

Adam Elsesser: California has an additional aspect of private attorney General action.

Adam Elsesser: Which sometimes can make those complicated.

Adam Elsesser:

Adam Elsesser: We believe very strongly that we have.

Adam Elsesser: Run and follow the rules.

Adam Elsesser: There were some.

Adam Elsesser: Technical violations.

Adam Elsesser: And we settled those claims pretty quickly for a scale. This is a one time.

Adam Elsesser: Settlement this captures it all and.

Adam Elsesser: And we can move on.

Adam Elsesser: Making making our products and doing the things that matter the most.

Adam Elsesser: Thanks.

Adam Elsesser: Yeah.

Speaker Change: Thanks Bill.

Robert Justin Marcus: The next question comes from Robbie Marcus from J.P. Morgan. Your line is now open.

Adam Elsesser: Next question comes from Robbie Marcus from Jpmorgan. Your line is now open.

Robert Justin Marcus: Oh, great. Thanks for taking the question. Maybe just to start, really good growth in thrombectomy in the quarter, although access in EMBO was weaker.

Robert Justin Marcus: Oh, great. Thanks for taking my question.

Robert Justin Marcus: <unk>.

Robert Justin Marcus: Maybe just to start.

Robert Justin Marcus: You know really good growth in thrombectomy in the quarter.

Robert Justin Marcus: <unk> access and ammo was weaker maybe you could just talk to the trends you're seeing how much is stocking destocking versus underlying trends and.

Adam Elsesser: Maybe you could just talk about the trends you're seeing. How much is stocking and destocking versus underlying trends? And how to think about some of the nuances between the different products that are moving forward.

Adam Elsesser: How to think about some of the nuances between.

Adam Elsesser: The different products Theyre moving forward.

Adam Elsesser: Yeah, Robbie, it's Adam. I appreciate the question very much. Obviously, as you know, we broke out the numbers differently so people could sort of accurately view what I think everyone agrees is what's driving our growth and what's valuing the business. Obviously, you know that in the U.S., we have market-leading products in both peripheral EMBO and neuro-access, and that business is something we're particularly proud of. But we've said, obviously, that what's driving our growth is going to be the thrombectomy.

Speaker Change: Yeah Ravi.

Adam Elsesser: Robbie it's Adam.

Speaker Change: Appreciate very much the question.

Adam Elsesser: Obviously as you know.

Adam Elsesser: We broke out the numbers differently, so people could sort of accurately view, what what I think everyone agrees is.

Adam Elsesser: What's driving our growth and whats valuing the business.

Adam Elsesser: Obviously, you know that in the U S. R. We have market leading products in both peripheral m'bow and neuro access in and that business is something we're particularly proud of.

Adam Elsesser: But we've said obviously that what's driving our growth is going to be the thrombectomy, that's where our focus is going to be.

Adam Elsesser: That's where our focus is going to be moving forward. In addition, on the call in Q4, we specifically called out that we would be leaving certain markets with our EMBO and access business in international markets where they weren't financially viable for us as product reimbursements changed and moved down over time. So we sort of said that going forward. That happened.

Adam Elsesser: Moving forward in addition.

Adam Elsesser: On the call in Q4, we specifically called out that.

Adam Elsesser: That we would be.

Adam Elsesser: Leaving certain markets with our.

Adam Elsesser: <unk> and access business in international markets, where they werent.

Adam Elsesser: Financially viable for us is product.

Adam Elsesser: Reimbursement has changed and move down over time.

Adam Elsesser: So we sort of said that going forward.

Adam Elsesser: That's what happened.

Adam Elsesser: We also are particularly proud of.

Adam Elsesser: We are also particularly proud of the way, you know, the thrombectomy business has gone. And remember, in Jason's prepared remarks just today, we did say that we'll expect to see growth in our U.S. EMBO and access business, you know, as the year progresses and we move, you know, with our new larger commercial team on the thrombectomy side, we'll have the scale and the capacity to focus on multiple things, as well as some new launches.

Adam Elsesser: The way.

Adam Elsesser: Thrombectomy business has gone and remember in Jason's prepared remarks.

Adam Elsesser: Just today.

Adam Elsesser: We did say that we will expect to see growth in our U S and bone access business.

Adam Elsesser: The year progresses.

Adam Elsesser: And we move with our new larger commercial teams I'm on the thrombectomy side, we'll have to see.

Adam Elsesser: The scale and the capacity to focus on multiple things as well as some new launches. We just had one with midway which is a neuro access tool.

Adam Elsesser: We just had one with Midway, which is a neuro-access tool, at the beginning of this quarter. So the business is strong. It's just not going to be the thing that drives growth in an outsized way like our thrombectomy business.

Adam Elsesser: At the beginning of this quarter. So the business is strong its just not going to be the thing that drives.

Adam Elsesser: The growth in the outsized way like our thrombectomy business will.

Adam Elsesser: Okay.

Robert Justin Marcus: Great, maybe just one extra. As we think about now U.S. thrombectomy and O.U.S. thrombectomy, which, like I said, had really good quarters, how do we think about some of the underlying trends in neuro versus peripheral, and is there any way to size the two?

Adam Elsesser: Great maybe just one extra as we think about now U S strong back to me and <unk>, which like I said have really good quarters.

Robert Justin Marcus: Do we think about some of the underlying trends in neuro versus peripheral and is there any way to size that too. Thanks a lot.

Robert Justin Marcus: Yeah.

Adam Elsesser: Are you talking about within the various vascular beds in thrombectomy? Correct.

Robert Justin Marcus: Thanks a lot. You don't have to...

Robert Justin Marcus: Youre talking about within.

Robert Justin Marcus: The various vascular beds in thrombectomy so.

Adam Elsesser: So, obviously, yeah, obviously, if you look at our U.S. numbers, the bigger growth came from VTE on the venous side with flash. Obviously, now with the launch of 2.0, that will continue as the market grows and we catalyze adoption and, of course, take share with that. The arterial side is continuing to also do well. And stroke did really, really well. We were pleasantly surprised. I think I answered another question earlier just now that our stroke growth was sort of within our range that we put out there, which is pretty significant now having multiple Quarters where the stroke businesses continue to grow. Some of that is market. A lot of that's still shared, and I think that will continue as a nice setup as people get more and more excited about Thunderbird.

Robert Justin Marcus: Obviously, yes, obviously, if you look at our U S numbers.

Adam Elsesser: The bigger growth came from BTG on the venous side with flash.

Adam Elsesser: Obviously now with lunch at 2.0 that will continue as the market grows and we catalyze adoption and of course take share with that.

Adam Elsesser: <unk>.

Adam Elsesser: The arterial side is continuing to also do well.

Adam Elsesser: And stroke did really really well.

Adam Elsesser: We were pleasantly surprised.

Adam Elsesser: I think I answered. Another question earlier, just now that the our stroke growth was sort of within our range that we put out there.

Adam Elsesser: Which is pretty significant now having multiple quarters.

Adam Elsesser: Where the stroke businesses continue to grow some of that is market a lot of that still share.

Adam Elsesser: And I think that will continue as a nice setup.

Adam Elsesser: As people get more and more excited about thunderbolt.

Speaker Change: Thanks, a lot.

Speaker Change: Thank you.

Lawrence H. Biegelsen: Our next question comes from Larry Biegelsen from Wells Fargo. Your line is now open.

Adam Elsesser: Our next question comes from Larry Nicholson from Wells Fargo. Your line is now open.

Lawrence H. Biegelsen: Good afternoon, thanks for taking the question. So Adam, you're counting on international sales of peripheral devices to drive growth next year. The issue has been international reimbursement. So what proof points can you provide that give us confidence that the reimbursement will be in place next year to drive that revenue?

Lawrence H. Biegelsen: Good afternoon, and thanks for taking the question.

Lawrence H. Biegelsen: So Adam Youre counting on international sales of peripheral devices to drive growth next year and the issue has been the internationally reimbursement. So what proof points can you provide that give us confidence that the reimbursement will be in place next year to drive that revenue.

Adam Elsesser: Yeah, I appreciate the question. Let me, without being inappropriate, tell you we're not counting on international growth to drive our growth. I think I've tried to say over and over that our U.S. thrombectomy business is what is going to drive our growth. I think I even said it just in the last question.

Lawrence H. Biegelsen: Yes.

Adam Elsesser: I appreciate the question let me.

Adam Elsesser: Without being inappropriate.

Adam Elsesser: We're not counting on international to drive our growth.

Adam Elsesser: I think I've tried to say over and over that our U S. Thrombectomy business is what is going to drive our growth I think I, even said it just in the last question. So that is what is going to drive our growth not just this year, but for many many years as we continue to catalyze the adoption of that the conversations we're having the reaction.

Adam Elsesser: So that is what is going to drive our growth, not just this year, but for many, many years as we continue to catalyze the adoption of that. The conversations we're having, the reactions we're having, not just with physicians but in a broader context are very, very encouraging. International adds to that, but it is not the centerpiece of our growth going forward. And obviously, it will be slightly slower. I won't say slower is the wrong term, but it will be less all at once because of what you just said.

Adam Elsesser: Having not just with physicians, but but in a larger context is very very encouraging.

Adam Elsesser: International adds to that.

Adam Elsesser: But it is not the centerpiece of our growth going forward and obviously it will be slightly I won't say slower is the wrong term, but it will be less all at once because of what you've just said certain markets certain countries will have reimbursement already in place.

Adam Elsesser: Certain markets, certain countries will have reimbursement already in place. Some systems have a difference between private and public where we can start to go on the private side, but the public won't come as fast. All of that is taken into account as we look out in the future, but I think we have many, many years of growth ahead of us in our U.S. thrombectomy business.

Adam Elsesser: Some systems have a difference between private and public where we can start to go on.

Adam Elsesser: Private side, but public won't come as fast all of that's taken into account as we look out in the future, but I think we have many many years of growth being driven in our U S thrombectomy business.

Lawrence H. Biegelsen: Okay, that's helpful. Just for my follow-up, Adam, on Thunder, the comments you made on enrollment and encouraging outcomes, I think you said, what's the latest on when you expect to complete enrollment? Is clintrials.gov accurate? Which says, I think, primary endpoint completion is, I think, last time I looked, March 2025. Thank you.

Speaker Change: Okay. That's helpful. Just for my follow up Adam on Thunder. The comments you made on enrollment.

Speaker Change: An encouraging outcomes I think you said.

Lawrence H. Biegelsen: Whats the latest on when you expect to complete enrollment as Clint trials Dot Gov accurate, which says I think primary endpoint completion I think last time I look March 2025. Thank you.

Lawrence H. Biegelsen: Okay.

Adam Elsesser: Well, Larry, I think you know that I've learned my lesson to be too predictive about this trial, so we'll leave where clinicaltrials.gov is right now. Needless to say, obviously, we're excited about it, it's progressing, we've seen a lot of engagement, a lot of discussion, and excitement about it.

Adam Elsesser: Well, Larry I think you know that I've learned my lesson to be too predictive.

Adam Elsesser: And predict on this trial, so so we'll leave.

Adam Elsesser: The the way or clinical trials Dot Gov is right now needless to say, obviously, we're excited about it.

Adam Elsesser: It's progressing we've seen.

Adam Elsesser: A lot of engagement a lot of discussion and excitement about it.

Lawrence H. Biegelsen: And so I think we'll leave the exact timing the way it is for now. Thank you. Thank you. I appreciate it.

Adam Elsesser: And so.

Adam Elsesser: I think we'll leave the exact timing the way it is for now.

Speaker Change: Thank you.

Speaker Change: Thank you I appreciate it.

Matthew O'brien: Our next question comes from Matthew O'Brien from Piper Sandler. Your line is now open.

Lawrence H. Biegelsen: Our next question comes from Matthew O'brien from Piper Sandler Your line is now open.

Matthew O'brien: Good afternoon. Thanks for taking my questions. Just in looking at how the stock's trading in the aftermarket down a little bit, I'm assuming that most people are thinking that the But the guide for the rest of the year might be a little bit at risk, just given tougher comps. But it does look like the thrombectomy business is accelerating on a two-year stack basis. Even the EMBO and AXS in the U.S. seem like it, pretty good too.

Matthew O'brien: Afternoon. Thanks for taking my questions just on looking at how the stocks trading in the aftermarket down a little bit.

Matthew O'brien: Assuming that most people are thinking that the.

Matthew O'brien: But the guide for the rest of the year might be a little bit at risk just given tougher comps, but it does look like the thrombectomy business is accelerating on a two year stack basis, even the <unk> access in the U S seems like it's.

Matthew O'brien: So just the combination of what you're seeing from a new customer perspective going deeper into existing accounts, and then this expanded sales force, you know, those folks don't kick in, you know, right away; it typically takes a little bit of time. Can you just give us a sense for what you're really counting on to see this acceleration in the back half as or, sorry, the last three quarters of the year as comps get tougher in the US business?

Matthew O'brien: It's pretty good.

Matthew O'brien: Just the combination of what Youre seeing from a new customer perspective going deeper in existing accounts and then this.

Matthew O'brien: Expanded sales force those folks don't kick in right away. It typically takes a little bit of time. So just the combination of all those things can you just give us a sense for what you're really counting on to see this acceleration in the back half as well.

Matthew O'brien: The last three quarters of the year as comps get tougher.

Matthew O'brien: In the U S business.

Adam Elsesser: Yeah, I really appreciate that question. Just so we can sort of level the playing field, we address a lot of guidance, a lot more comprehensively both on this call and in the Q4 call where we laid out the very specifics. As you know, we said we had a lot of visibility with our international distributor orders and partners around the timing of their orders. And that's the main difference in those rates, together with the work that we already know and see about how our U.S. thrombectomy business is going to grow.

Matthew O'brien: Yes.

Speaker Change: Really appreciate that question.

Adam Elsesser: So we.

Adam Elsesser: We can sort of level set.

Adam Elsesser: We addressed.

Adam Elsesser: Lot guidance a lot more comprehensively both on this call and in the Q4 call, where we laid out there.

Adam Elsesser: The very specifics as you know, we we said we had a lot of visibility with our international distributor orders.

Adam Elsesser: And partners around the timing of their orders and Thats. The main difference in in those rates together with the work that we already know and see.

Adam Elsesser: How are you S thrombectomy business is going to grow.

Adam Elsesser: We have a lot more predictability around those rates, and they're not dramatically changing those rates throughout the year. We've said that twice. So it really came down, the change in overall company rate was based on something we talked about on last quarter's call, and it turned out to be exactly what we said. And again, the focus on what is happening in the U.S. should be the best confidence guide because the rest of that is relatively secure through what we have obtained from our distributor partners for the rest of the year.

Adam Elsesser: We have a lot more predictability around those rates and theyre not.

Adam Elsesser: Dramatically changing those rates throughout the year, we said that now twice so it really came down.

Adam Elsesser: The change in overall company right.

Adam Elsesser: Was based on something we talked about last quarter's call.

Adam Elsesser: And it turned out to be exactly what we said.

Adam Elsesser: And again the focus on what is happening in the U S should be the best confident guide because the rest of that is relatively secure.

Adam Elsesser: Through what we have obtained from our distributor partners.

Adam Elsesser: For the rest of the year.

Adam Elsesser: Okay, appreciate that. And then, you know, Adam, you mentioned these new products that are coming out with CAVT and at least one by the end of this year. Is that a product that's potentially going to be going into a different part of the anatomy than we're accustomed to with Penumbra? Or, you know, any kind of just general thoughts on what we should expect from that one specifically? Well, as we get closer.

Speaker Change: Okay I appreciate that.

Adam Elsesser: And then Adam you mentioned these new products that are coming in.

Adam Elsesser: And at least one by the end of this year is that a product thats going to be.

Adam Elsesser: Potentially going into a different part of the anatomy than we're accustomed to with the number or any kind of just general thoughts on what we should expect from that one specifically.

Adam Elsesser: Well, as we get closer and you know that we're at this stage of the field, I'm not going to give you more specifics for competitive reasons, but God, I can't wait to tell you. So, please be patient. It's going to be an awful lot of fun.

Adam Elsesser: Well as we get closer.

Adam Elsesser: And.

Adam Elsesser: We are at this stage of the field.

Adam Elsesser: I'm not going to give more specifics for competitive reasons, but.

Adam Elsesser: But god I can't wait to tell you. So please be patient.

Adam Elsesser: It's going to be an awful lot of fun.

Speaker Change: Got it thank you.

Speaker Change: Thank you.

Michael Anthony Sarcone: The next question comes from Mike Sarcone from Jeffries. Your line is now open.

Adam Elsesser: The next question comes from Mike <unk> from Jefferies. Your line is now open.

Michael Anthony Sarcone: Good afternoon, and thanks for taking my questions. Of course. Just to start, do you think you can give us any color on the U.S. VTE market, what you're viewing as kind of market growth for the quarter?

Michael Anthony Sarcone: Good afternoon, and thanks for taking my questions.

Michael Anthony Sarcone: Of course.

Michael Anthony Sarcone: Just to start you think you can.

Michael Anthony Sarcone: Give us any color on in the U S.

Michael Anthony Sarcone: <unk> market, what you're viewing as kind of market growth.

Michael Anthony Sarcone: For the quarter.

Adam Elsesser: You know, it's historically always hard to really piece out market growth, i.e., new patients, other than looking at centers that we have had 100% of their business for and see that they've grown.

Michael Anthony Sarcone: You know, it's historically always hard too.

Adam Elsesser: Really piece out market growth I E new patients.

Adam Elsesser: Other than looking at centers that we have had 100% of their business for and see that they've grown and that's been true.

Adam Elsesser: And that's been true. We have seen continued growth, you know, for several years now. So that growth continues. Obviously, particularly in VTE, that growth we've seen, which was really wonderful this year, this quarter, is also some market share, and that's even before Flash 2.0. So we'll wait to finish next quarter and see the effect of that. But I think it's gonna be a combination, as we said in the prepared remarks, of some significant share shift as well as some real significant catalyzing of adoptions or market growth initiatives.

Adam Elsesser: We have seen continued growth for several years now so that growth continues obviously, particularly in <unk>.

Adam Elsesser: <unk>.

Adam Elsesser: That growth, we've seen which was really wonderful. This year. This quarter is also.

Adam Elsesser: So market share.

Adam Elsesser: That's even before flash to point out so.

Adam Elsesser: So we'll wait to finish next quarter and see the effect of that.

Adam Elsesser: But I think it's going to be a combination as we said in the prepared remarks of some significant share shift as well as some real significant catalyzing, a adoption sort of market growth initiatives.

Michael Anthony Sarcone: Got it, thanks. And just to follow up, you've been talking a lot about market access efforts, and I think you previously mentioned working with some of your hospital customers to kind of, you know, get data and work hand-in-hand with them to elucidate, you know, the benefit of CAVT in different vascular beds. Do you think you can give us any update on how those efforts are progressing? I'm not going to, for obvious reasons...

Speaker Change: Got it thanks and.

Speaker Change: And just a follow up.

Michael Anthony Sarcone: <unk> been talking a lot about market access efforts and I think you've previously mentioned working with some of your hospital customers to China.

Michael Anthony Sarcone: Get data and work hand in hand with them to elucidate the benefit of <unk> and different.

Michael Anthony Sarcone: Vascular beds do you think you can give us any any update on how those efforts are progressing.

Adam Elsesser: I'm not going to, for obvious reasons, go into specific systems and work that we're doing yet. I want to do the work first, and we'll see the benefit of it, and then we can talk about it a little more openly. But I will tell you I'm really optimistic.

Michael Anthony Sarcone: I'm not going to for obvious reasons go into specific.

Adam Elsesser: Systems and.

Adam Elsesser: Work that we're doing yet I want to do the work first and we will see the benefit of it.

Adam Elsesser: We can talk about it little more openly.

Adam Elsesser: But I will tell you.

Adam Elsesser: I'm really.

Adam Elsesser: I am really optimistic.

Adam Elsesser: There's a lot of understanding in the hospital community over what I think is one of the more important topics, which is that clinically significant clot burden is really one of the most under-treated acute issues in healthcare. They understand the effect of not treating it. They understand the cost of not treating it. And, more importantly than anything, the downside to patients for not doing it.

Adam Elsesser: There's a lot of.

Adam Elsesser: Of understanding.

Adam Elsesser: In the hospital community.

Adam Elsesser: Over what I think is one of the more important topics which is people.

Adam Elsesser: People understand that clinically significant clot burden is really one of the most undertreated acute issues in health care. They understand the effect of not treating it they understand the cost of not treating it they understand more importantly, the amazing the.

Adam Elsesser: The downside to patients for not doing it.

Adam Elsesser: And I think that allows these conversations to be as positive as they've been and get started on the work that we're doing. So I'm, you know, more optimistic this quarter. I've been personally involved in another bunch of those conversations, and I'm very, very optimistic.

Adam Elsesser: And I think that allows these conversations to be as positive as they've been.

Adam Elsesser: And get started on the work that we're doing so.

Adam Elsesser: This quarter more optimistic I've been personally involved in another a bunch of those conversations.

Adam Elsesser: And I'm I'm very very optimistic.

Speaker Change: Okay. Thank you.

Speaker Change: Thank you.

Richard Samuel Newitter: The next question comes from Richard Newitter from Truist. Your line is now open.

Adam Elsesser: And our next question comes from Richard You later from tourists. Your line is now open.

Richard Samuel Newitter: Hey guys, thanks for taking the question. It's Sam on for Rich. First one on U.S. thrombectomy, and apologies if I missed this, but I think before you had said you expected 27 to 30 percent, you know, within that range, within U.S. thrombectomy for the year. Can we still think about that holding through 2Q through 4Q, just kind of plug in those numbers, and I get to 29 percent growth for this year in U.S. throm

Richard Samuel Newitter: Hey, guys. Thanks for taking the question, it's Sam on for Rich first one on U S Thrombectomy and apologies if I missed this bank before you had said you expect 27% to 30% within that range within you asked thrombectomy for the year.

Richard Samuel Newitter: Can we can we still think about that holding through to Q3 <unk>.

Sam: Plug in those numbers and I guess from 29% growth for this year you guys come back to me.

Jason Richard Mills: Yeah, thanks for the question. This is Jason.

Richard Samuel Newitter: Yes. Thanks for the question. This is Jason So we said last quarter, we reiterated on this call that we expect growth in U S. Thrombectomy.

Jason: To be within that range, obviously, the first quarter.

Jason: We're slightly above that range. It was a strong quarter, but our guidance still reflects that range each quarter for the remainder of the year and for the year. So.

Jason Richard Mills: So we said last quarter, and we reiterated on this call that we expect growth in U.S. thrombectomy to be within that range. Obviously, the first quarter was slightly above that range. It was a strong quarter. But our guidance still reflects that range each quarter for the remainder of the year and for the year. So that's where we're going to stick for now.

Jason: That's why we're going to stick for now.

Jason Richard Mills: Okay, and then a similar sort of question on margin, you know, a little over 200 basis points of operating margin expansion in 1Q. Just kind of curious what you'd like to see in terms of trends in the business to get confident in increasing that 100 to 200 basis point range for the year. Thanks.

Jason Richard Mills: Okay.

Jason Richard Mills: And then similarly, a similar sort of question on margin.

Jason Richard Mills: A little.

Jason Richard Mills: Well over 200 basis points of operating margin expansion and one can you just kind of curious what what you'd like to see in terms of trends in the business to get confident in increasing that 100 to 200 basis point range for the year. Thanks.

Speaker Change: Yeah no. Thank you obviously with the startup of the year, we are very happy with our margin performance.

Maggie S. Yuen: Yeah, no, thank you. Obviously, with a good start to the year, we are very happy with our margin performance. After Q1, we typically see some normal material price increases and some investment in new product launch productivity. So for the remainder of the year, we will continue to see productivity improvements, and improvement in product mix will continue. So we're pretty confident that we'll continue. Yeah, and I'll just add on to that.

Maggie S. Yuen: Q1, we typically see some normal material price increase and some investment in new product launch productivity so far.

Maggie S. Yuen: For the remainder of the year.

Maggie S. Yuen: We will continue to see productivity improvement and improvement in product mix will continue. So we are pretty confident that we'll continue to see this.

Maggie S. Yuen: Martin's trends expansion.

Maggie S. Yuen: Yeah, and I'll just add on to that. We said when we gave the initial guidance for 2024 on the February call, and we reiterated again this quarter, that given the cadence of expenses that we traditionally see, we expected that operating margin expansion would be sort of in that 100 to 200 basis point range on a year-over-year basis for each quarter, which would obviously translate into that expansion for the full year. So it's important to understand sort of the cadence of our operating margins through the year.

Speaker Change: Yes, and I'll just add on to that.

Speaker Change: <unk> said when we gave the initial guidance for 2024 on the February call. We reiterated again this quarter that given the cadence of expenses that we traditionally see.

Maggie S. Yuen: We expected the operating margin expansion would be sort of in that 100 to 200 basis point range on a year over year basis for each quarter, which would obviously translate into that expansion for the full year. So it's important to understand sort of the cadence of our operating margins through the year.

Ellie: Alright, are we still there?

Maggie S. Yuen: Alright.

Maggie S. Yuen: There.

Maggie S. Yuen: Okay.

David Kenneth Rescott: Our next question comes from David Rescott from Baird. Your line is now open.

Ellie: Our next question comes from David West caused from Baird. Your line is now open.

David Kenneth Rescott: So, great. Thanks for taking the questions here. I wanted to ask, Adam, I heard you mention that Flash 2.0 kind of optimizes some of the advantages of Flash 1.0. So, you know, wondering if you can give us a better understanding maybe about what's different in the system. And I heard some of the comments around pent-up demand for the system already. So, just curious about what's baked into maybe that implied Q2 guide versus the full year relative to those pent-up demand comments, and if, and what, and where, you know, maybe Flash 2.0 could open up new opportunities for the company.

David Kenneth Rescott: Oh, great. Thanks for taking the questions here.

David Kenneth Rescott: I wanted to ask Adam I heard you mentioned that flash to Plano kind of optimized on some of the advantages of a flash at one point I was wondering if you can give us a better understanding maybe about what's different in the system and I heard some of the comments around.

David Kenneth Rescott: Pent up demand as you go system already so just curious on what's baked in maybe that implied to Q2 guide versus the full year relative to those kind of demand comments.

David Kenneth Rescott: And what and where maybe flash to you point out could open up new opportunities for the company.

Adam Elsesser: Yeah, well, let me sort of first describe what we're seeing and hearing a lot of, which is obviously, flash 1.0 did an extraordinary job. It took a great deal of clot out very quickly. What flash 2.0 does, which is simply a change in algorithm, an update in the algorithm, it didn't change the catheter or the catheter size. But 2.0 removes even more clots, even faster, without having to go to a bigger or less appropriate sized catheter.

Adam Elsesser: Yeah, well, let me sort of describe what we're seeing and hearing a lot of which is.

Adam Elsesser: Obviously flash one boy no did an extraordinary job it took.

Adam Elsesser: A great deal of cloud out very quickly.

Adam Elsesser: What flash 2.0 does which is simply a <unk>.

Adam Elsesser: Change in algorithm and update in the algorithm it didn't change the catheter the catheter size.

Adam Elsesser: But 2.0 removes even more cloud even faster.

Adam Elsesser: Without having to go to a bigger or less appropriate sized catheter.

Adam Elsesser: And I think the field is rallying around that. They're seeing the benefit of it. And as you know, word of mouth spreads pretty quick in this field, so we're seeing a lot of interest from folks who might not have wanted to try it in PE. They might have used flash 1.0 in DVT, and that level of sort of interest is what I was alluding to. I think everyone continues to look to optimize treatment for these patients.

Adam Elsesser: And I think the field is rallying around that.

Adam Elsesser: They are seeing the benefit of it.

Adam Elsesser: And as you know word of mouth spreads pretty quick in this field. So we're seeing a lot of interest from from folks who might not have wanted to try it in.

Adam Elsesser: P/e they might have used flash 1.0 and DVT.

Adam Elsesser: And that level of sort of interest is what I was alluding to.

Adam Elsesser: I think everyone continues to look to optimize the treatment for these patients. So that's the key you want to do the three things that matter. The most and we've said it before but its safety speed and simplicity and flashed 2.0 really checks those boxes and that's the reaction that everyone is.

Adam Elsesser: That's the key. You want to do the three things that matter most. And we've said it before, but it's safety, speed, and simplicity. And flash 2.0 really checks those boxes, and that's the reaction that everyone is feeling.

Adam Elsesser: <unk> right now.

David Kenneth Rescott: Okay, great. And then maybe on Thunderbolt and the Thunder trial, you know, I heard the comments, and trying to think maybe a little bit longer term, I believe with SendIt, you've been able to maybe leverage some price already. And you discussed that in the past around getting up in that gain share, you know, when I think about Thunderbolt, I guess, longer term, you know, in the opportunity that's out in the front still, do you still think that there's an ability to maybe command some type of price premium for a premium price product longer term when that comes to market? Thank you.

Speaker Change: Okay, Great and then maybe on.

Adam Elsesser: Thunderbolt and their Thunder trial.

David Kenneth Rescott: I heard the comments and <unk>.

David Kenneth Rescott: Trying to think maybe a little bit longer term I believe with the trend that you had been able to maybe leverage some some price already and you discussed that in the past around Ginnie open that gain share.

David Kenneth Rescott: When I think about Thunder.

David Kenneth Rescott: Paul I guess longer term.

David Kenneth Rescott: And the opportunity that's out in the front store do you still think that there is an ability to maybe command a price premium for a premium price product longer term one that comes to market. Thank you.

Adam Elsesser: Yeah, I think, if you step back and think about stroke, it's not a lot different from clotting in other parts of the body, where the prices of products have risen as technology has developed and become more sophisticated. Right now, in stroke, people use a series of things. They might use aspiration and a stent reaver.

David Kenneth Rescott: Yeah.

David Kenneth Rescott: Zinc.

David Kenneth Rescott: If you step back and think about stroke.

Adam Elsesser: It's not a lot different from caught in the other parts of the body.

Adam Elsesser: The prices of products have risen.

Adam Elsesser: As technology.

Adam Elsesser: It has developed and become more sophisticated.

Adam Elsesser: They might do this and that. So, by the time you're done, we are not going to be more expensive than what a lot of people are already doing. They're just going to be using 100% of the Penumbra products, because you don't need all of those ancillary tools when you have one simple system like Thunderbolt. And that's what we saw already. That's not me hoping and guessing.

Adam Elsesser: Now in stroke people use.

Adam Elsesser: A series of things they might use aspiration and as to entry where they might do this matt so that by the time you're done.

Adam Elsesser: We are not going to be more expensive than what a lot of people are already doing theres, just going to be using 100% of the number of products. Because you don't need all of the ancillary tools. When you have one simple system like Thunderbolt and Thats, what we saw already that's not me, hoping and guessing.

Adam Elsesser: That's what we spent the better part of a year doing with our CABT portfolio. In the rest of the body, particularly the closest example would be Lightning Bolt in the arterial system. The technologies are very, very similar, different-sized catheters. And we've seen, obviously, an extraordinary increase in the usage of that product. I think we'll see something similar with stroke. I think we'll be starting at a little bit different spot than we did with our older technology on the arterial side. Which I think ultimately plays to our benefit because we're starting with a pretty significant dominant position with a lot of competitors. So, I think Thunderbolt just helps us going forward.

Adam Elsesser: That's what we spent the better part of a year with our CBT portfolio.

Adam Elsesser: In the rest of the body, particularly the most sort of.

Adam Elsesser: Closest.

Adam Elsesser: Example, would be lightening bolt in the arterial system.

Adam Elsesser: The technologies are very very similar different sized catheters and.

Adam Elsesser: And we've seen obviously, an extraordinary increase in the usage of that product.

Adam Elsesser: I think we will see something similar with stroke.

Adam Elsesser: I think we'll be starting at a little bit different spot than we did with our older technology in the arterial side.

Adam Elsesser: I think ultimately it plays to our benefit because we're starting with a pretty significant.

Adam Elsesser: <unk>.

Adam Elsesser: The dominant position with a lot of competitors. So I think thunderbolt just helps us going forward.

Adam Elsesser: Yes.

David Kenneth Rescott: All right, very helpful. Thank you.

Speaker Change: Alright Thats helpful. Thank you.

Speaker Change: Thank you.

Michael Stephen Matson: Your next question comes from Mike Matson from Needham and Company. Your line is now open.

David Kenneth Rescott: The next question comes from Mike Matson from Needham and company. Your line is now open.

Michael Stephen Matson: Yeah, thanks. So I want to just ask one: with Lightning Flash 2.0, you know, you've incorporated software into the CAVT product. So, you know, is this sort of an opportunity to iterate on the products faster? In other words, could we expect to see, you know, 3.0, 4.0, et cetera, maybe over a year or something like that as you continue to improve the software?

Michael Stephen Matson: Yeah. Thanks, So wanted to just ask one with lightning flashed 2.0, you've incorporated.

Michael Stephen Matson: Software into the CVT product so.

Michael Stephen Matson: Is this sort of an opportunity to to iterate the product faster or in other words, you know could you could we expect to see a 3.04 point out et cetera.

Michael Stephen Matson: Maybe every year something like that.

Michael Stephen Matson: As you continue to improve the software.

Adam Elsesser: Yeah, it's a great question. The premise is accurate.

Speaker Change: Yes, it's a great question.

Adam Elsesser: The premise.

Adam Elsesser: As accurate obviously.

Adam Elsesser: With software.

Speaker Change: There is the possibility of faster iterations than hardware catheters and all the testing is very thorough but it's a slightly different thing.

Adam Elsesser: Obviously, with software, there's the possibility of faster iterations and hardware catheters and all, you know, the testing is very thorough, but it's a slightly different thing. That being said, so the Can we continue to improve this? Probably. We're, you know..., months, weeks into the launch, and it's going really well.

Adam Elsesser: That being said.

Adam Elsesser: So the.

Adam Elsesser: Can we continue to improve this.

Adam Elsesser: Probably.

Speaker Change: We are.

Adam Elsesser: My weeks into the launch.

Adam Elsesser: And it's going really well, so we havent yet identified.

Adam Elsesser: So we haven't yet identified weaknesses that we have to fix, and I think that's a high-class problem for us to have or to improve. But, you know, over the course of, you know, the sheer volume of work we're going to do over the next year, I'm sure we will continue to make changes and improve. Obviously, the products that I alluded to, the three new CABT products, are not another version of the same one. So, you know, they're newer products that cover different things than just improving lightning flash to a 3.0. But, yes, conceptually, that's...

Adam Elsesser: This is that we have to fix.

Adam Elsesser: And I think that's a high class problem for us to have.

Adam Elsesser: Or to improve but over the course of the.

Adam Elsesser: The sheer volume of work, we're going to do over the next year I'm sure. We will continue to make changes and improve obviously.

Adam Elsesser: The products that I alluded to the three new CVT products or not.

Adam Elsesser: Another version of the same one so.

Adam Elsesser: Are there new products that cover different things than just improving.

Adam Elsesser: Lightning flash to a three point, but yes conceptually that's possible.

Michael Stephen Matson: Okay, got it. And then, Adam, I think it was you that made a comment about optimizing the commercial team and the prepared remarks, so I just wanted to see if you could elaborate on that, what that means, I guess.

Speaker Change: Okay got it and then Adam I think it with you that made a comment about optimizing the commercial team in the prepared remarks. So I just wanted to see if you could elaborate on that what that means I guess.

Adam Elsesser: Yeah, so our philosophy has always been, you know, that we don't want the commercial team to lead the selling. We want the products to be wanted, and then we have to have enough people to do the work and support those products. And we have always had what I consider the best commercial team ever assembled, and we've been extraordinarily proud of our commercial team for many, many years.

Michael Stephen Matson: Yes.

Speaker Change: <unk> has always been that we.

Adam Elsesser: We don't want.

Adam Elsesser: The commercial team to lead the selling we want the products to be wanted and then we have to have enough people to do the work and support those products.

Adam Elsesser: We have always had what what I consider the best commercial team.

Adam Elsesser: Ever assembled and we have been extraordinarily proud of our commercial team for many many years.

Adam Elsesser: We just had so much to do last year, you know, between the launch of both Flash and Bolt at the same time, our peripheral embolization business, which is, again, market-leading technology, and all these new customers that we talked about for a big chunk of last year. So we needed more people to do the work. Those people are now here.

Adam Elsesser: Just had so much to do last year between the launch of both flash and bolt at the same time.

Adam Elsesser: Yes.

Adam Elsesser: Our peripheral embolism embolization business wishes again market leading technology.

Adam Elsesser: And on all these new customers that we talked about for <unk>.

Adam Elsesser: Big chunk of last year, so we need more people to do the work.

Adam Elsesser: They're on board. We were able to hire some of the best folks we could, so I think we have, really, an optimized size team today. You know, as this continues, you know, could we, would we add to it? Sure, it's not impossible, but it's certainly not in our plans anytime soon as we continue to go through this year. I think we've got the team we need to drive the kind of growth we're talking about and serve the patients and physicians that we need to serve this year.

Adam Elsesser: Those people are now ear they are onboard.

Adam Elsesser: We were able to hire some of the best folks.

Adam Elsesser: We could so I think we have really today and optimized size team.

Adam Elsesser: As this continues could could we would we add to it sure it's not impossible, but it's certainly not in our plans anytime soon as we continue to go through this year I think we got the team we need to.

Adam Elsesser: To drive this kind of growth, we're talking about and serve the patients and physicians that we need to serve this year.

Adam Elsesser: Yeah.

Michael Stephen Matson: Okay, I got it. Thank you.

Speaker Change: Okay got it thank you.

Speaker Change: Thank you.

Ellie: Again, if you'd like to ask a question, please press star, then the number 1 on your telephone keypad. Our next question comes from Shagun Singh from RBC Capital. Your line is now open.

Speaker Change: Again, if you'd like to ask a question. Please press Star then the number one on your telephone keypad.

Shagun Singh Chadha: Our next question comes from just Chugging Kim from RBC capital. Your line is now open.

Shagun Singh Chadha: Great, thank you so much. So Adam, you're targeting 16 to 20% growth here in 2024 versus your initial directional outlook of plus 20%. I was just wondering, is there a pathway for you to return to that plus 20% growth, and what could potentially be the drivers of it? Is it Flash 2.0?

Shagun Singh Chadha: Great. Thank you so much so Adam you're targeting 16% to 20% growth here in 'twenty four.

Shagun Singh Chadha: Versus your initial directional outlook of plus 20% I was just wondering is there a pathway for you to return to that plus 20% growth and what could potentially be the drivers of that as it flashed two point, though is that the new product that you alluded to that we could see.

Shagun Singh Chadha: This year.

Shagun Singh Chadha: And really the question is how should we think about growth longer term for penumbra is there a plus 20% base case on the horizon and then just as a follow up on Q2, just wondering if there's any color you can provide prior to today's call consensus was looking at tier two for sales and 61 central EPS any any color would be great.

Shagun Singh Chadha: Is it the new product that you alluded to that we could see, you know, this year? And then, you know, really the question is how should we think about growth over the longer term for Penumbra? Is there a plus 20% base case on the horizon? And then, just as a follow-up on Q2, just wondering if there's any color you can provide. Prior to today's call, consensus was looking at 302 for sales and 61 cents for EPS. Any color would be great.

Adam Elsesser: Thank you for taking the questions.

Speaker Change: Thank you for taking the questions.

Adam Elsesser: Yeah, let me start on the first part. You know, our philosophy around guidance is pretty straightforward. We look at and take into account all the information we have at the time we give our guidance, and that has been our approach for some time. So I'm not going to sort of deviate from that and sort of guess what could happen here or there.

Speaker Change: Yeah, Let me let me start on the first part.

Adam Elsesser: We've always.

Adam Elsesser: Looked sort of.

Adam Elsesser: Our philosophy around guidance is.

Adam Elsesser: It's pretty straightforward, we look and take into account all the information we have at.

Adam Elsesser: At the time, we give our guidance and that has been our approach.

Adam Elsesser: For some time, so I'm not going to sort of deviate from that and sort of guess what could happen here.

Adam Elsesser: Here or there obviously.

Adam Elsesser: Obviously, we are extremely happy with where the business is. We feel an awful lot of excitement and momentum around the products that we've added to this field, and we're very proud of them. I think we'll leave the guessing of guidance for a future time beyond what we've said. That also being said, and this is not meant as a comment about guidance, it's meant as a comment about the work we have ahead, I also said in the prepared remarks that there are 1.25 million people in the U.S. alone who have a clot in their body that we should consider doing something about and are potentially now more able to do something about than we've ever been in the past.

Adam Elsesser: We're extremely happy with where the business is we feel.

Adam Elsesser: Awful lot of excitement and momentum around the products that we've added to this field and we're very proud of it.

Adam Elsesser: <unk>.

Adam Elsesser: I think we'll leave.

Adam Elsesser: The guessing a guidance for a future time.

Adam Elsesser: And what we've said.

Adam Elsesser: That also being said.

Adam Elsesser: And this is not meant as a comment around guidance.

Adam Elsesser: Meant around the comment of the work we have ahead.

Adam Elsesser: I also said in the prepared remarks that there is.

Adam Elsesser: 125 million people in the U S alone who have clot in their body.

Speaker Change: We should.

Adam Elsesser: Consider doing something about potentially now more able to do something about them we've ever been in the past.

Adam Elsesser: And obviously, that lays out the work we have to do, and that will obviously impact our future thoughts around how the business will grow. But it's premature to do that, and we're going to focus on what we're doing right now. Yeah, and Shagun, to your second question.

Adam Elsesser: And obviously.

Adam Elsesser: That <unk>.

Shagun: Ladies out the work we have to do.

Adam Elsesser: And that will obviously impact our future thoughts around how the business will grow but it's premature to do that.

Adam Elsesser: And we're going to focus on what we're doing right now.

Jason Richard Mills: Yeah, and Shagun, to your second question, we reiterated today the sort of cadence of revenue growth we expect through the balance of the year, and we said the same thing on the initial guidance call in February, where the first part of the year was expected to be in the mid-teens range. Today you obviously saw us report growth of a little over 15%, and we said that the second half of the year we would see at the top end of the range or above, and part of that is the visibility we have in the international cycle, and of course, we've talked a lot about our U.S. thrombectomy business and the commercial team in the products, Flash 2.0 among them there. I think you have – I tried to be comprehensive in my prepared remarks to give you the components of the business to set up your models, but I'm happy to take any follow-ups if that's not enough.

Speaker Change: And sugar.

Speaker Change: To your second question.

Jason Richard Mills: We reiterate it today sort of the cadence of revenue growth, we expect through the balance of the year and we said the same thing on the initial guidance call in February where the first part of the year, we expected to be in the mid teens range. Today, you obviously saw us.

Jason Richard Mills: Report growth.

Jason Richard Mills: Over 15%.

Jason Richard Mills: And we said that the second half of the year.

Jason Richard Mills: We would see at the top end of the range or above it.

Jason Richard Mills: Part of that is the visibility we have in the international cadence and.

Jason Richard Mills: Of course, we've talked a lot about our U S thrombectomy business.

Jason Richard Mills: The commercial team and the products to pointed out among them. There. So I think you have we tried to be comprehensive in my prepared remarks to.

Jason Richard Mills: To give you the components of the business to.

Jason Richard Mills: To set up your models.

Jason Richard Mills: But happy to take any follow ups, that's not enough.

Speaker Change: Thank you.

Speaker Change: Thank you.

Cecilia Furlong: There are no further questions at this time. Ms. Furlong, I turn the call back over to you.

Speaker Change: There are no further questions at this time, Mr. <unk> long I turn the call back over to you.

Cecilia Furlong: Thank you, Operator. On behalf of our management team, thank you all again for joining us today and for your interest in Penumbra. We look forward to updating you on our second quarter call.

Speaker Change: Thank you operator on behalf of our management team. Thank you all again for joining us today and for your interest in Penumbra, we look forward to updating you on our second quarter call.

Ellie: This concludes today's conference call. You may now disconnect.

Speaker Change: This concludes today's conference call you may now disconnect.