Q1 2025 Venus Concept Inc Earnings Call
Please standby good.
Operator: Please stand by. Good day, ladies and gentlemen, and welcome to the first quarter 2025 earnings conference call for Venus Concept. At this time, all participants have been placed in a listen-only mode.
Speaker Change: Ladies and gentlemen, and welcome to the first quarter of 2025 earnings Conference call for Venus concept, Inc.
At this time, all participants have been placed in a listen only mode.
Operator: Please note that this conference call is being recorded and that the recording will be available on the company's website for review. Before we begin, I'd like to remind everyone that our remarks and responses to your questions today may contain forward-looking statements that are based on the current expectations of management and involve inherent risks and uncertainties that could cause actual results to differ materially from those indicated, including those identified in the risk factors section of our most recent annual report on Form 10-K filed with the Securities and Exchange Commission. Such factors may be updated from time to time in our filings with the SEC, which are available on our website.
Speaker Change: Please note that this conference call is being recorded and that the recording will be available on the company's website for replay.
Speaker Change: Before we begin I'd like to remind everyone that our remarks and responses to your questions. Today may contain forward looking statements that are based on the current expectations of management and involve inherent risks and uncertainties that could cause actual results to differ materially from those indicated including those identified in the.
Speaker Change: The risk factors section of our most recent annual report on Form 10-K filed with the Securities and Exchange Commission.
Speaker Change: Such factors may be updated from time to time in our filings with the SEC.
Speaker Change: Which are available on our website.
Operator: We undertake no obligation to publicly update or revise our forward-looking statements as a result of new information, future events, or otherwise.
Speaker Change: We undertake no obligation to publicly update or revise our forward looking statements as a result of new information future events or otherwise.
Operator: This call will also include references to certain financial measures that are not calculated in accordance with generally accepted accounting principles or GAAP. We generally refer to these as non-GAAP financial measures. Reconciliations of those non-GAAP financial measures to the most comparable measures calculated and presented in accordance with GAAP are available in our earnings press release issued today on the investor relations portion of our website.
Speaker Change: This call will also include references to certain financial measures that are not calculated in accordance with generally accepted accounting principles or GAAP.
Speaker Change: We generally refer to these as non-GAAP financial measures reconciliations of those non-GAAP financial measures to the most comparable measures calculated and presented in accordance with GAAP are available in our earnings press release issued today on the Investor Relations portion of our website.
Rajiv Da Silva: I would now like to turn the call over to Mr. Rajiv Da Silva, Chief Executive Officer of Venus. Please go ahead.
Speaker Change: I would now like to turn the call over to Mr. Rajiv de Silva Chief Executive Officer of Venus concept. Please go ahead Sir.
Rajiv Da Silva: Thank you, operator, and welcome everyone to Venus Concept's first quarter 2025 earnings conference call.
Speaker Change: Thank you operator, and welcome everyone to Venus Concept's first quarter 2025 earnings conference call.
Rajiv Da Silva: I'm joined on the call today by our Chief Financial Officer, Domenic Della Penna. Let me start with an agenda of what we will cover during our prepared remarks. I will begin with a brief review of our first quarter results and operating developments in the recent months. Following that, Domenic will provide you with an in-depth review of our first quarter financial results, as well as an update on our balance sheet and financial conditions. Then we will open the call for your questions. With that agenda in mind, let's get started. As detailed in our press release issued today, our first quarter revenue results came in modestly softer than expected due to delays in the timing of new system sales expected in late March driven by current market conditions.
Speaker Change: I'm joined on the call today are Chief Financial Officer, Domenic della Penna.
Speaker Change: Let me start with an agenda of what we talked about during our prepared remarks.
Speaker Change: I will begin with a brief review of our first quarter results and operating developments in the recent months.
Speaker Change: Following that Domenic will provide you with an in depth review of our first quarter financial results.
Speaker Change: Well, that's an update on our balance sheet and financial condition.
Speaker Change: Then we will open the call for your questions.
Speaker Change: With that agenda in mind.
Speaker Change: Get started.
Speaker Change: As detailed in our press release issued today.
Speaker Change: Other revenue results came in modestly softer than expected due to delays in the timing of new system sales expected in late March driven by late by current market conditions.
Rajiv Da Silva: Some of these sales were consummated in early April. First quarter revenue declined 22% year-over-year, driven by a 25% decline in systems revenue and, to a lesser extent, a high single-digit decline in procedure-related products and service revenue. Our team delivered solid execution despite the continued challenging environment. The global capital equipment environment continues to present a level of uncertainty as to the timing and pace of new system adoption in both the US and international markets across the aesthetic sector as well. customer financing pressures, economic uncertainty, higher interest rates, tighter credit markets, and uncertainty related to proposed tariffs continue to impact customer system adoption throughout our business.
Speaker Change: Some of these sales were consummated in early April.
Speaker Change: Fourth quarter revenue declined 22% year over year, driven by a 25% decline in systems revenue and to a lesser extent a high single digit decline in procedure related products and service revenue.
Speaker Change: Our team delivered solid execution, despite the continued challenging environment.
Speaker Change: The global capital equipment environment continues to present and know all about it.
Speaker Change: Certainty as to the timing and pace of new system adoption in both the U S and international markets across the aesthetic sector as a whole.
Speaker Change: Customer financing patches economic uncertainty higher interest rate.
Speaker Change: Tighter credit market and uncertainty related to proposed tariffs continue to impact customer system adoption throughout our business.
Rajiv Da Silva: Despite the more challenged operating environment, the team continues to focus on a strategic priority to transition the company to higher quality cash revenue. Cash system sales in the U.S. represented 80% of total U.S. system sales in the first quarter, compared to 75% last year. We continue to believe that our efforts to reposition the business to prioritize cash system sales is the right strategy to enhance the company's long-term profitability profile. While the overall time-to-close deals continues to impact our quarter-to-quarter system's sales results, we are encouraged by the team's continued focus on customer engagement and support, as well as prioritizing co-products in the U.S., including BlitzMax, VistaPro, and VivaMD, to improve sales efficiency.
Speaker Change: Despite the more challenging operating environment. The team continues to focus on strategic priority.
Speaker Change: And the cost the company into a higher quality cash revenues.
Speaker Change: Cash system sales in the U S represented 80% of total U S system sales in the first quarter.
Speaker Change: They had to seven 5% last year.
Speaker Change: We continue to believe that our efforts to reposition the business to prioritize cash system sales is the right strategy to enhance the company's long term profitability profile.
Speaker Change: While the overall time to close deals continues to impact our quarter to quarter systems sales results.
Speaker Change: Courage by the team's continued focus on customer engagement and support that's about that's fire testing co products in the U S, including Bliss Max what's the pro and B M D to improve sales efficiency.
Rajiv Da Silva: Our international results in the first quarter also reflect the impact of disrupted distributor ordering patterns due to the hesitancy on the part of our distributor partners given the uncertainty related to increased global macro headwinds and trade concerns. Wall-E-Way While we expect continued fluctuation in ordering patterns from our distribution partners in key international markets, we are encouraged by the early evidence that our efforts to evolve our OUS commercial strategy to enhance future growth and profitability are on the right track. Our priority now is to ensure that we are as well positioned as possible to return to growth when the overall global capital equipment environment improves.
Speaker Change: How about international yourselves in the first quarter also reflects the impact of disrupted distributor ordering patterns given the hesitancy on the part of our distributor partners given the uncertainty related to increased global macro headwinds.
Speaker Change: Incentives.
Speaker Change: Do we go.
Speaker Change: While we expect continued fluctuations in ordering patterns from our distribution partners and key international markets.
Speaker Change: Courage by the early evidence that our efforts to evolve well all U S commercial strategy will enhance future growth and profitability on the right.
Speaker Change: Okay.
Speaker Change: Our priority now is to ensure that we are as well positioned as possible to return to growth in the overall global capital equipment environment improves.
Rajiv Da Silva: We are actively working on evolving our portfolio and look forward to announcing our next body device in the second half of 2025. We are managing our cash burn through disciplined cost management and making targeted investments to support our long-term growth. We believe that the increase of GLP-1 usage by consumers is an exciting catalyst for the industry and a chance for Venus to highlight complementary benefits of our body technology, specifically skin tightening, to our customers that are on waste lot mitigation.
Speaker Change: The actively working on evolving our portfolio and look forward to announcing our next body device and the <unk>.
Speaker Change: Top of page 25, yes.
Speaker Change: We are managing our cash burn through disciplined cost management, and making targeted investments to support our long term growth.
Speaker Change: We believe that the increase of G. O P. One usage by consumers and exciting catalyst for the industry and the chance of Venus to highlight.
Speaker Change: Elementary benefits about body technology, specifically skin tightening.
Speaker Change: And is that on waste locked medications.
Speaker Change: We enhanced our balance sheet condition in March by converting 11 million of madmen that equity.
Rajiv Da Silva: who enhanced the balance sheet condition in March by converting $11 million of Madrin debt by $10 billion. And in April, we secured a new bridge loan amendment from Madrin and two equity capital transactions which together represent further validation from existing and new investors of the potential value creation opportunity that Venus offers.
Speaker Change: And in April we secured a new bridge loan amendment migraine and two equity capital transactions, which together represent further validation from existing and new investors and potential value creation opportunity that business office.
Domenic Della Penna: With that, let me turn the call over to Domenic for a review of our first quarter financial results and balance sheet. Domenic. Thanks, Rajiv.
Dominic: With that let me turn the call over to Dominic.
Dominic: Our first quarter financial results and balance sheet Dominic.
Dominic: Thanks James for.
Domenic Della Penna: For the avoidance of doubt, unless otherwise noted, my prepared remarks will focus on the company's reported results for the first quarter of 2025 on a gap basis . and all growth-related items are on a year-over-year basis. We've reported total revenue of $13.6 million, down $3.8 million, or 22% year-over-year. As Rajiv mentioned earlier, our revenue results were softer than expected given the timing of system deals closing in the U.S. and distributor ordering patterns. We were encouraged to see some of the deals that were expected to close in late March close in early April. Distributor hesitancy towards placing orders remains a potential headwind given the heightened level of global macro and trade uncertainty in recent months.
Speaker Change: For the avoidance of doubt unless otherwise noted my prepared remarks will focus on the company's reported results for the first quarter of 2025 on a GAAP basis.
Speaker Change: And all growth related items are on a year over year basis.
Speaker Change: We reported total revenue of $13 6 million down $3 8 million or 22% year over year.
Speaker Change: As Rajeev mentioned earlier, our revenue results were softer than expected given the timing of system deals closing in the U S and distributor ordering patterns.
Speaker Change: We were encouraged to see some of the deals that were expected to close in late March closed in early April.
Speaker Change: Distributor hesitancy towards placing orders remains a potential headwind given the heightened level of global macro and trade uncertainty in recent months.
Domenic Della Penna: The year-over-year decrease in total revenue in the first quarter was driven by a 29% decrease in international revenue and a 16.5% decrease in United States.
Speaker Change: The year over year decrease in total revenue in the first quarter was driven by a 29% decrease in international revenue and a $16 five decrease in United States.
Speaker Change: The year over year decrease in total revenue byproduct category.
Domenic Della Penna: the year-over-year decrease in total revenue by product category. a 25% decrease in products systems revenue, a 25% decrease in lease systems revenue. The percentage of total systems revenue derived from the company's internal lease programs, Venus Prime and our legacy subscription model, was approximately 25% in the first quarter of 2025, compared to 25% in the prior year period.
Speaker Change: A 25% decrease in products systems revenue at 25% decrease in lease systems revenue.
Speaker Change: The percentage of total systems revenue derived from the company's internal lease programs Venus Prime and our legacy subscription model was approximately 25% in the first quarter of 2025 compared to 25% in the prior year period.
Speaker Change: Turning to a review of our first quarter financial results across the rest of the P&L.
Domenic Della Penna: Turning to a review of our first quarter financial results across the rest of the P&L. Gross profit decreased $2.9 million, or 25%, to $8.8 million. The decrease in growth profit is primarily due to the effects of tighter third-party lending practices, which negatively impacted capital equipment sales in the U.S., and a decrease in revenue in our international markets driven by the accelerated exit from unprofitable direct markets, combined with distributor uncertainty over economic and trade patterns facing the macro environment. gross margin was at 64.2% of revenue compared to 66.6% of revenue for the first quarter of 2024.
Speaker Change: Gross profit decreased $2 9 million or 25% to $8 8 million.
Speaker Change: The decrease in gross profit is primarily due to the effects of tighter third party lending practices, which negatively impacted capital equipment sales in the U S and a decrease in revenue in our international markets driven by the accelerated exit from unprofitable direct markets combined with distributor uncertainty over.
Speaker Change: Economic and trade patterns facing the macro environment.
Speaker Change: Gross margin was at 64, 2% of revenue compared to 66, 6% of revenue for the first quarter of 2024.
Speaker Change: Total operating expenses decreased $1 1 million or 6% to $18 3 million.
Domenic Della Penna: Total operating expenses decreased $1.1 million, or 6%, to $18.3 million. The reduction in first quarter 2025 operating expenses reflects our continued progress and cost containment and streamlining of our operations. Gap operating loss was $9.5 million compared to $7.8 million in the first quarter of 2024. Net interest and other expenses were $2.5 million, compared to $2 million in the first quarter of 2024. The year-over-year change in net interest and other expenses was driven primarily by a $1 million non-cash loss on debt extinguishment which did not impact prior period results and a non-cash foreign exchange gain of $0.1 million compared to a non-cash loss of $0.3 million last year, offset partially by lower interest expense on outstanding borrowing which totaled $1.6 million in the first quarter compared to $1.7 million last year.
Speaker Change: The reduction in first quarter 2025 operating expenses reflects our continued progress in cost containment and streamlining of our operations.
Speaker Change: GAAP, our GAAP operating loss was $9 5 million compared to $7 8 million in the first quarter of 2024.
Speaker Change: Net interest and other expenses were $2 5 million compared to $2 million in the first quarter of 2024.
Speaker Change: The year over year change in net interest and other expenses was driven primarily by.
Speaker Change: A 1 million noncash loss on debt extinguishment, which did not impact prior period results and a noncash foreign exchange gain of 0.1 million compared to a noncash loss of 0.3 million last year.
Speaker Change: Offsetting partially by lower interest expense on outstanding borrowings, which totaled $1 6 million in the first quarter compared to $1 7 million last year.
Domenic Della Penna: Net loss attributable to stockholders for the first quarter of 2025 was $12.4 million or $17.44 per share, compared to net loss of $9.8 million or $16.91 per share for the first quarter of 2024. Weighted average shares outstanding for the first quarter of 2025 and 2024 gives effect for the company's 1-4-11 reverse stock split effective March 3, 2025. Adjusted EBITDA loss for the first quarter of 2025 was $8.3 million compared to adjusted EBITDA loss of $5.1 million for the first quarter of 2024. As a reminder, we have provided a full reconciliation of our gap net loss to adjusted EBITDA loss in our earnings press release.
Speaker Change: Net loss attributable to stockholders for the first quarter of 2025 was $12 4 million or $17.44 per share compared to net loss of $9 8 million or $16 91 per share for the first quarter of 2024.
Speaker Change: Weighted average shares outstanding for the first quarter of 2025, and 2024 gives effect for the company's one 411 reverse stock split effective March three 2025.
Speaker Change: Adjusted EBITDA loss for the first quarter of 2025 was $8 3 million.
Speaker Change: Compared to adjusted EBITDA loss of $5 1 million for the first quarter of 2024.
Speaker Change: As a reminder, we have provided a full reconciliation of our GAAP net loss to adjusted EBITDA loss in our earnings press release.
Speaker Change: Turning to the balance sheet.
Domenic Della Penna: Turning to the balance sheet, as of March 31st, 2025, the company had cash and cash equivalents of $3.2 million and total debt obligations of approximately $35.5 million compared to $4.3 million and total debt obligations of approximately $39.7 million respectively as of December 31st, 2024. This represents a $4.2 million reduction in total debt obligations in the quarter. As Rajiv mentioned previously, we announced a new bridge loan amendment with our primary lender, Madron Asset Management, which increased our financing capacity by $10 million. We continue to appreciate the support of Madren as we execute on enhancing the financial profile of the business.
Speaker Change: As of March 31, 2025, the company had cash and cash equivalents of $3 2 million and total debt obligations of approximately $35 5 million compared to $4 3 million and total debt obligations of approximately $39 7 million respectively. As of December 31, two.
Speaker Change: Thousand 24.
Speaker Change: This represents a $4 2 million reduction in total debt obligations in the quarter.
Speaker Change: As Rajeev mentioned previously we announced a new bridge loan amendment with our primary lender Madron asset management, which increased our operate our financing capacity by $10 million.
Speaker Change: We continue to appreciate the support of Madron as we execute on enhancing the financial profile of the business.
Speaker Change: We also announced three important items subsequent to quarter end.
Domenic Della Penna: We also announced three important items subsequent to quarter end. On April 1st, 2025, the company exchanged $11 million of its subordinated convertible notes held by affiliates of Madron Asset Management for 379,311 shares of its Series Y preferred stock. This transaction allowed us to maintain NASDAQ compliance through achieving NASDAQ stockholders' equity threshold. On April 10th and 14th, the company announced registered direct offering price at the market for the sale of a combined 715,273 shares of common stock for combined proceeds. of 2.7 million growth. before deducting placement agencies and other offering expenses.
Speaker Change: On April one 2025, the company exchanged $11 million of subordinated convertible notes held by affiliates of <unk> asset management.
Speaker Change: 379311 shares of its series Y preferred stock.
Speaker Change: This transaction allowed us to maintain NASDAQ compliance through achieving NASDAQ stockholders equity thresholds.
Speaker Change: On April 10th and 14th the company announced registered direct offering priced at the market for the sale of a combined 715273 shares of common stock for combined proceeds.
Speaker Change: Of $2 7 million gross.
Speaker Change: Before deducting placement agencies and other offering expenses.
Domenic Della Penna: Lastly, with respect to our financial outlook for 2025, Given the company's active dialogue with existing lenders and investors, the ongoing evaluation of strategic alternatives with various interested parties to maximize shareholder value, and current market conditions impacted by trade disruptions, the company is not providing full year 2025 financial guidance at this time. The company does expect to see sequential revenue growth in the second quarter.
Speaker Change: Lastly, with respect to our financial outlook for 2025.
Speaker Change: Given the company's active dialogue with existing lenders and investors.
Speaker Change: The ongoing evaluation of strategic alternatives with various interested parties to maximize shareholder value.
Speaker Change: And current market conditions impacted by trade disruptions. The company is not providing full year 2025 financial guidance at this time.
Speaker Change: The company does expect to see sequential revenue growth in the second quarter.
Speaker Change: With that I'll turn the call over to the operator to open the call for your questions operator.
Operator: With that, I'll turn the call over to the operator to open the call for your questions. Operator? Thank you. If you'd like to ask a question, please signal by pressing star 1 on your telephone cable. If you're using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment.
Speaker Change: Thank you if you'd like to ask a question. Please signal by pressing star one on your telephone keypad if.
Speaker Change: If you're using a speaker phone. Please make sure your mute function is turned off to allow your signal to reach our equipment.
Speaker Change: Our first question comes from the line of Thomas Mcgovern with Maxim Group. Please proceed with your question.
Thomas Mcgovern: Our first question comes from the line of Thomas McGovern with Maxim Group. Please proceed with your question. Hey guys, thank you for taking my question. So first, I wanted to talk about, you mentioned on the call several times as it relates to the international business, but just curious to have a better understanding as to how you expect recently enacted and proposed tariffs to impact your business as we move throughout 2025. Thanks.
Thomas Mcgovern: Hey, guys. Thank you for taking my question.
Thomas Mcgovern: First I wanted to talk about and then you mentioned on the call several times as it relates to the international business, but just curious to have a better understanding as to how you expect.
Thomas Mcgovern: <unk> recently enacted and proposed tariffs to impact your business as we move throughout 2021st effects.
Dominic: Dominic do you do you want to.
Domenic Della Penna: Domenic, do you want to take that and I'll add to it? Sure, I can take that. So as you know, our business is primarily on the energy-based side. We source our products directly from Israel through a contract manufacturer, and the tariffs that are announced in respect of the Israel relate to about 10% at this stage. Now negotiations are ongoing, but if we assume the 10% tariff told, then that impact on the energy-based side would have in 2025 an impact of between 1 and 1.5% on our gross margins, and that's exiting 2025. As we move into 2026, that impact could be between 2 and 2.5% of gross margins.
Thomas Mcgovern: Take that and I'll I'll add to it sure.
Dominic: Sure I can take that.
Dominic: So as you know our business is primarily on the energy based side, we source our products directly from Israel.
Dominic: Through a U S contracts through a contract manufacturer and the tariffs.
Dominic: That are announced in respect of the Israel.
Dominic: Relate to about 10% at this stage no negotiations are ongoing.
Dominic: But if we assume the 10% sure tolls.
Dominic: Ben.
Dominic: That impact on the energy based side would have in 2025 and.
Dominic: An impact of between one and one 5% on our gross margins and that's exiting 2025 as we move into 2026 that impact could be between two and two 5% of gross margins.
Domenic Della Penna: Now, when we include our robotics business, which represents between 20 and 25% of our business, the impact is somewhat similar. It would be in the sort of 1 to 2% range in 2020 5 in the second half. And in 2026, it would be somewhere in the 2 to 2.5% range as well. So the when you sort of dissect the business, three-quarters of the business is sort of sourced from products from Israel and one-quarter of that relates to products that are manufactured through the robotic side in the U.S. but there are component parts that come from Europe in relation to the robotic side of the business.
Dominic: Now when we include our robotics business, which represents between 20 and 25% of our business the.
Dominic: The impact is.
Dominic: It is somewhat similar it so it would be in the sort of 1% to 2% range in 2020.
Dominic:
Dominic: Five in the second half.
Dominic: And in 2026, it would be somewhere in the two to two 5% range as well.
Dominic: So the when you had sort of dissect the business.
Dominic: Three quarters of the business is sort of source from products from Israel.
Dominic: And one quarter of that relates.
Dominic: It relates to products that are manufactured through robotics side in the U S. But there are component part.
Dominic: That come from Europe in relation to the robotics side of the business. So in both counts are the tariffs. We expect are in the 10% range, but it could be lower depending on how the negotiations pan out with both Israel and in the EU.
Domenic Della Penna: So in both counts, the tariffs we expect are in the 10% range but could be lower depending on how the negotiations pan out with both Israel and the EU. So overall, it would have a slight marginal impact on margins, and that is without any mitigation efforts on our part, right? So we have the opportunities to try to recover some of that margin hit. But assuming there is no pricing recovery, that would be the maximum extent of the impact. Overall, Thomas, the actual impact of the tariffs on us is going to be very modest and likely manageable through pricing.
Dominic: So overall it would have a slight marginal impact on margins and that is without.
Dominic: Any mitigation efforts on our part right. So we have the opportunity is to try to recover some of that margin hit but assuming there is no.
Dominic: Pricing recovery that would be the maximum bankruptcy impact.
Amit: So overall, it's Amit.
Amit: The actual impact with the kind of thing that wouldn't be very modest and likely manageable through through pricing.
Domenic Della Penna: I think the disruptions we're talking about is the fact that generally there's overall economic uncertainty around the world because of the uncertainty of the tariffs, which is causing our distributors to be more hesitant in terms of their purchasing patterns, right? So it's not a direct impact, it's indirect. understood. That makes a lot of sense.
Amit: B the disruptions we are talking about is the fact that.
Amit: Generally does overall economic uncertainty around the world because of the uncertainty of the tariffs, which is causing our distributors to be more hesitant in terms of that purchase a matter right. So it's not a direct impact is the indirect impact.
Amit: Understood that makes a lot of fun.
Domenic Della Penna: You mentioned also that there were, you know, several contracts with several sales that you expected to close at the end of the first quarter that were pushed into the second quarter. Were these mostly related to U.S. sales, or were you seeing some distributor orders that maybe you expected in the first quarter that had been pushed into TOHU? It's a combination of the two. And again, it's generally tied to this issue of hesitancy in light of economic conditions, right, which is relevant to our US customers as well as our international distributors. People have the need for these devices but are being more cautious.
Amit: I mentioned also that there were.
Amit: Several contracts with several sales and you expected to close at the end of the first quarter that were pushed into the second quarter were these mostly related to the U S sales are or where you're seeing some distributor orders that maybe you would expect in the first quarter that had been pushed into tissue.
Amit: The comment it's a combination of the two and again.
Amit: Generally tied to this.
Amit: This issue of hesitancy in light of economic conditions.
Amit: Relevant to our U S customers as well that's about it.
Amit: International distributors people are.
Amit: People, who have the need for these devices, but being more cautious.
Domenic Della Penna: And oftentimes, a lot of our sales happen very much towards the very end of the quarter, literally on the last couple of days. And sometimes when these deal negotiations extend, it just extends beyond the end of the quarter, right, which is the phenomenon that we saw at the end of the first quarter. Yes, Thomas, the lending practices are much more difficult. The protocols that the lenders are taking in terms of validating credit, etc., just take a lot longer. So it's tougher to get some of these deals closed. And we experienced not only on the distributor side, but in the US, that was our direct business.
Amit: And often times in a lot of us sales happened very much towards the very end of the quarter that literally on the last couple of days and sometimes Oh N O N.
Amit: These are doing when it goes into the extended this extends beyond the end of the quarter right, which is the phenomenon that we saw.
Amit: At the end of the first quarter.
Amit: Yeah, Thomas the lending practices are.
Amit: Much more difficult.
Amit: The protocols.
Amit: Lenders are taking in terms of validating credit et cetera, just take a lot longer.
Amit: So it's tougher to get some of these deals closed and we experienced not only.
Amit: On the distributor side, but in the U S. It was our direct business and even in Australia, we had deals that that's almost.
Domenic Della Penna: And even in Australia, we had deals that almost made it through in Q1, but closed shortly after Q1 ended. So it's impacting all markets. Understood. I appreciate the color there.
Amit: <unk> made it through in Q1, but close shortly after.
Amit: Q1, Q1 ended so it's impacting all markets.
Speaker Change: Understood I appreciate the color there and then last thing for me just you mentioned it briefly on the call, but obviously still still planning to launch the Nexgen body contouring device, just curious I mean, given us an update on that.
Rajiv Da Silva: And last thing for me, you mentioned it briefly on the call, but obviously still planning to launch this next-gen body contouring device. Just curious if you could give us an update on that, on the timeline if that remains on track for some time, early second half of 2025, and then just maybe talk high-level on your initial expectations for traction and how you plan to ramp adoption of the next-gen contouring device in the back half of the year. Thanks. Sure. On the first part of your question, yes, we do expect the same timing that we've talked about before, which is approval and launch sometime in the early part of the second half of the year.
Speaker Change: On the timeline of that remains on track for some time you know early second half of 'twenty five and then just maybe talk high level on kind of your initial expectations for traction and how you plan to ramp our adoption of the Nextgen contrary device in the back half of the year. Thanks.
Speaker Change: Sure on your first part of your question, Yes, we do expect.
Speaker Change: The same timing that we've talked about before which is a approval and launch sometime in the early part of the second half of the year.
Rajiv Da Silva: The regulatory process is underway, and as of now, there's no reason to believe that the timing should extend. We have not yet really talked publicly about all aspects of the product, so I'm not going to go into many details, other than to say that this is a device that has been developed based on a lot of customer feedback on some of our best-selling devices that are already on the market. So, we do expect meaningful market uptake when we do have it available. There's already a lot of customer excitement about it, and we expect to make more public commentary about it when the product is approved.
Speaker Change: The regulatory process is underway.
Speaker Change: As of now there is no reason to believe that the timing should extend.
Speaker Change: We have not yet really talked publicly about.
Speaker Change: All aspects of the of the products and we're not going to go into many details other than to say that this is a this is a it device.
Speaker Change: That is.
Speaker Change: Had been developed based on a lot of customer feedback on some of our best selling.
Speaker Change: <unk> devices that are already on the market. So we do expect.
Speaker Change: Meaningful.
Speaker Change: Market uptake when we do have it available there's already a lot of customer excitement about it and.
Speaker Change: And we expect to make more public commentary about it.
Speaker Change: When the product is approved.
Thomas Mcgovern: Understood. I appreciate you taking the time to answer all my questions. Great. Thank you. Thanks, Thomas. Thank you. We are currently showing no additional participants in the queue.
Speaker Change: Understood I appreciate you taking time to answer all my questions.
Speaker Change: Great. Thank you.
Speaker Change: Thanks Thomas.
Speaker Change: Thank you we are currently showing no additional participants in the queue that does conclude our conference for today. Thank you for your participation.
Operator: That does conclude our conference for today. Thank you for your participation. Thank you.
Speaker Change: Great. Thank you.
Speaker Change: Yes.