Q3 2025 Allurion Technologies Inc Earnings Call
To prevent any background noise. After the Speakers' remarks, there will be a question and answer session.
If you would like to ask a question. During this time simply press Star then the number one on your telephone keypad.
And so we started a question press star one again, thank you now.
Now I would like to turn the call over to Charlie Brady. Please go ahead.
Good morning, and thank you for joining us.
Earlier today <unk> Technologies, Inc. Issued a press release announcing financial results for the quarter ended September 32025, and provided a business update you.
You can access a copy of the announcement on the company's website at investors <unk>, Larry on Dot com.
Shantanu Gaur: Good morning, and as always, thank you for joining us today. Before discussing our third-quarter results, I would like to begin by sharing what we believe are several exciting updates regarding the FDA approval process for the Allurion Smart Capsule. As you may recall, in June, we submitted the fourth and final module of our PMA submission to the FDA. Since June, we have passed several critical milestones on our way to a potential FDA approval. In July, FDA completed its acceptance and filing reviews, and we entered the substantive review phase. In August, we successfully passed our pre-approval inspection with zero findings. The pre-approval inspection is designed to assess the company's systems, methods, and procedures to ensure that the quality management system is effectively established. The inspection covered compliance with regulatory requirements, process quality, and documentation standards. There were no observations raised, and no Form 483 issued.
With me on the call today is Shawn to Nucor, founder and Chief Executive Officer.
Speaker #1: Hello and thank you for standing by . My name is Mark and I will be your conference operator today . At this time , I would like to welcome everyone to the third quarter earnings call .
Before we begin I would like to inform you that comments mentioned on today's call contain forward looking statements within the meaning of federal Securities laws.
Speaker #1: All lines have been placed on mute to prevent any background noise . After the speakers remarks , there will question and be a answer session .
Actual results may differ materially from those expressed or implied as a result of certain risks and uncertainties.
Speaker #1: If you would like to ask a question during this simply press star . time , Then the number one on your telephone keypad withdraw your .
These risks and uncertainties are described in detail in our Securities and Exchange Commission filings, including our annual report on our Form 10-K filed on March 27, 2025 as amended by Amendment number one there are two filed on August 19 2025.
Speaker #1: question , And to press star one again . Thank you . Now I would the call over to Tara Brady . Please go ahead .
Speaker #2: Good morning and thank
Speaker #2: ALLURION TECHNOLOGIES, INC. issued a press release announcing results for financial quarter ended September 30th , 2025 . provided a business And update . You can copy of access a the announcement on the company's website at .
Our SEC filings can be found through our company website at investors Dot alert you on dot com or the Sec's website.
Investors are cautioned not to place undue reliance on such forward looking statements and hilarious undertakes no obligation to publicly update or release any revisions on these forward looking statements.
Speaker #2: With me on the call today is founder and chief executive Shantanu Gaur we . begin , I would like Before inform you comments mentioned on today's call contain forward looking statements that within the meaning of like to turn officer securities laws .
In addition to the company's GAAP results management will also provide supplementary results on a non-GAAP basis.
Shantanu Gaur: In October, the company underwent a bioresearch monitoring, or BIMO, inspection. The BIMO inspection is designed to assess a company's clinical trial systems, methods, and procedures to ensure data integrity. There were no observations raised, and no Form 483 was issued. In October, we held our Day 100 meeting with FDA, and we were quite pleased with the outcome. After reviewing our PMA submission, FDA did not request any additional human clinical data. We believe this is a very positive sign that we are entering the final stages of the review process. We believe passing these inspections with no observations and completing the Day 100 meeting in this manner are major milestones for Allurion on our path toward FDA approval, are testaments to our commitment to upholding the highest quality standards, and are indicative of our readiness to serve the US market.
Speaker #2: Actual results may differ materially from those expressed or implied as a result of uncertainties certain . These risks and uncertainties are described risks and detail in in our Securities and Commission Exchange filings , including our annual report Form 10-K on filed on March 27th , 2025 , as amended by amendment Number one thereto , filed on August 19th , 2025 .
Please refer to the press release issued today and the accompanying supplementary financial data tables for a detailed reconciliation of GAAP and non-GAAP results, which can be accessed from the Investor Relations section of the company's website.
Please note that this conference call is being recorded and will be available for audio replay on our website under the events and presentations section on our Investor Relations page shortly after the conclusion of this call.
Speaker #2: Our SEC filings can be found through our company website at investor or the SEC's website . Investors are cautioned not to undue reliance on such place statements .
And with that I will turn it over to Sean to now.
Good morning, and as always thank you for joining us today.
Before discussing our third quarter results I would like to begin by sharing what we believe are several exciting updates regarding the FDA approval process for the Hillary on smart capsule.
Speaker #2: In undertakes no obligation to Orion update or release any on these forward looking statements revisions . In addition to the company's GAAP results , management will also provide a supplementary results on a non-GAAP basis .
As you May recall in June we submitted the fourth and final module of our PMA submission to the FDA.
Shantanu Gaur: In light of these developments, we have begun to advance our own launch preparations internally and intend to share further updates on upcoming calls. Shifting now to the third quarter, revenue was $2.7 million, reflecting the restructuring we conducted in the third quarter to refocus our efforts on accounts and distributors who promote metabolically healthy weight loss as part of a comprehensive obesity management strategy that includes combination use of the Allurion Program with low-dose GLP-1s. We were pleased with our performance in the third quarter, despite the restructuring that we conducted in August and the seasonality we often observe due to the summer months. In my recent conversations with our customers, it is becoming clear that GLP-1 discontinuation can be a rich source of new patients for Allurion.
Speaker #2: refer to the Please release press accompanying issued and the supplementary financial data tables for detailed reconciliation of GAAP and results , which non-GAAP can be from the Investor Relations section of the company's website .
Since June we have passed several critical milestones on our way to a potential FDA approval.
In July FDA completed its acceptance in filing with us and we entered the substantive review phase.
Speaker #2: Please note that this conference call is being recorded and will available for audio replay on our website under the be Events and section on our Investor Relations page .
In August we successfully passed our pre approval inspection with zero findings.
Preapproval inspection is designed to assess the company's systems methods and procedures to ensure that the quality management system is effectively established being.
Speaker #2: Shortly after the Presentations this call . And with that , I will turn it over to Shantanu .
The inspection covered compliance with regulatory requirements process quality and documentation standards.
Speaker #3: Good morning . And as always , thank you for joining us
Speaker #3: Before discussing our third quarter results , I would like to begin by sharing what believe are several we updates regarding the FDA process approval Eulerian for the Smart Capsule .
There were no observations raised and no form 483 issue.
In October the company underwent a bio research monitoring or final inspection. The bimodal inspection is designed to assess the company's clinical trial systems methods and procedures to ensure data integrity again, there were no observations raised and no form 483 was issued.
Shantanu Gaur: Some customers have indicated that half of their Allurion patients have previously tried a GLP-1, validating our hypothesis that by focusing on accounts that offer multiple modalities of care, we can have access to a steady supply of patients. Even among clinics that offer exceptional follow-up to their patients who are taking GLP-1s, over half of these patients churn after one year. As a result, we continue to believe that the pivot we executed last quarter will lead to long-term growth and refinement of the strategy that we could utilize out of the gate in the US market, especially if GLP-1 prices continue to drop in the future. Operating expenses were $10.9 million, a decrease in expense of 29% compared to the prior year. Operating loss was $9.6 million and narrowed by 22% compared to prior year.
In October we held our day 100 meeting with FDA and we were quite pleased with the outcome. After reviewing our PMA submission FDA did not request any additional human clinical data we.
Speaker #3: The pre-approval is inspection assess a company's systems conclusion of , methods , and As designed to the quality management system is effectively established .
We believe this is a very positive sign that we are entering the final stages of the review process.
Speaker #3: The inspection covered compliance with regulatory requirements , process quality , and documentation standards . There were no observations raised ensure that no form 483 issued in October , the company underwent a monitoring or Bimo inspection .
We believe passing these inspections with no observations and completing the day 100 meeting this manner are major milestones for <unk> on our path toward FDA approval are testaments to our commitment to upholding the highest quality standards and are indicative of our readiness to serve the U S market.
Speaker #3: The BIMO inspection is designed to assess a company's clinical trial systems, methods, and procedures to ensure data integrity. Again, there were no observations raised and no Form 483 was issued in October.
In light of these developments, we have begun to advance our own launch preparations internally and intend to share further updates on upcoming calls.
Shantanu Gaur: Adjusted operating expenses were $8.4 million, a decrease in expense of 42% compared to the prior year. Adjusted net operating loss was $6.9 million and narrowed by 39% compared to the prior year. These improvements reflect the improved efficiencies we have been able to gain from the restructurings we have conducted over the past year. We expect our new strategy to continue to bear fruit in the fourth quarter as we onboard new distributors who meet our criteria, and we have been encouraged by the results we have already seen in quarter so far. As we announced previously, we also plan to restructure our balance sheet and are on a path to being debt-free. We have entered into a transaction to exchange all outstanding debt for convertible preferred equity, and concurrently announced a private placement financing that strengthens our financial position. As we pursue FDA approval and plan a US.
Shifting now to the third quarter revenue was $2 $7 million, reflecting the restructuring we conducted in the third quarter to refocus our efforts on accounts and distributors, who promote metabolically healthy weight loss as part of a comprehensive obesity management strategy that includes combination use of the ovarian program with low.
Speaker #3: We held our day 100 meeting with , and we FDA were quite pleased with the outcome . After reviewing our PMA FDA did submission .
Speaker #3: Not request any additional human clinical data. We believe this is a very positive sign that we are entering the final stages of the review process.
Does <unk> once we.
We were pleased with our performance in the third quarter. Despite the restructuring that we conducted in August and the seasonality, we often observe due to the summer months.
Speaker #3: We believe passing these inspections with no observations and completing the Day 100 meeting in this manner are major milestones for El-Erian on our path toward FDA approval.
On my recent conversations with our customers. It is becoming clear that GLC, one discontinuation can be a rich source of new patients for <unk>.
Speaker #3: Our testaments to our commitment to upholding the highest quality standards , and are indicative of our readiness to serve the US market in light of these developments , we have begun to advance our own launch intend to share internally and further updates on calls .
Some customers have indicated that half of their <unk> patients have previously tried to GLC, one validating our hypothesis that by focusing on accounts that offer multiple modalities of care. We can have access to a steady supply of patients.
Speaker #3: Shifting now to the third revenue was quarter , restructuring we conducted in the third quarter to refocus our efforts on reflecting the accounts and distributors who metabolically promote weight loss healthy as part of a comprehensive obesity management strategy .
Shantanu Gaur: Launch of the Allurion Smart Capsule, we wanted to have a clear path to being debt-free, and this transaction provides that path. The private placement further strengthens our balance sheet, helping to position us to achieve future catalysts, and we were very pleased to have participation from key existing stockholders and our strategic partner who has deep expertise in obesity. With this stronger balance sheet, I believe Allurion is better positioned to increase value for shareholders in the short and long term. I would like to now turn to the other two aspects of our strategy that we discussed on our last call, namely retooling our R&D pipeline and manufacturing capabilities in collaboration with our strategic partner, and bolstering our clinical pipeline with additional data on combination therapy. We are pleased to report that we are exploring the development of a drug-eluting balloon in collaboration with our strategic partner.
Even among clinics that offer exceptional follow up to their patients who are taking GOP loans over half of these patients churn after one year.
As a result, we continue to believe that the pivot we executed last quarter will lead to long term growth and refinement of the strategy that we could utilize out of the gate in the U S market, especially if <unk> prices continue to drop in the future.
Speaker #3: That includes combination use Illyrian of the program with low dose GLP one . We were pleased with our performance in the third quarter , despite the that we conducted restructuring in August and the we seasonality often observe due to the months .
Operating expenses were $10 9 million a decrease in expense of 29% compared to the prior year operating loss was $9 $6 million and narrowed by 22% compared to prior year.
Speaker #3: In my summer customers , it conversations is becoming with our clear discontinuation that a rich source of new patients for GLP one Olevian can be customers have .
Speaker #3: that half of their patients have previously tried a GLP one , validating our hypothesis that by focusing on accounts that offer modalities of care , we can have access steady to a supply of patients , even among clinics that offer exceptional follow up to their who are taking patients GLP one .
Adjusted operating expenses were $8 4 million.
A decrease in expense of 42% compared to the prior year.
Adjusted net operating loss was $6 $9 million and narrowed by 39% compared to the prior year.
Shantanu Gaur: While this is a long-term project, the potential could be massive. First, eluting GLP-1 medications in a controlled-release manner could be a game-changer for obesity therapy. Delivering GLP-1s through an intragastric balloon directly addresses the adherence challenges of GLP-1 use, which we believe will become even more apparent with once-daily pills, while directly combining two independent mechanisms of action into a single therapy. Such an innovation could be the ideal therapy for the nearly 50% of patients who stop using GLP-1s before achieving any clinical benefit. Second, and perhaps more importantly, the drug-eluting balloon could become a platform to deliver a wide array of medications, supplements, and microbiome enhancers that are important for gut health and the treatment of chronic gastrointestinal diseases. We believe this project also dovetails nicely with our intention to create a longer-lasting device that remains in the stomach beyond four months.
These improvements reflect the improved efficiencies, we have been able to gain from the restructurings, we have conducted over the past year.
Speaker #3: Over these patients churn after one year . a result , we continue to believe that the multiple executed last quarter term growth and refinement of strategy that we could As half of utilize out of the gate US in the market , especially if GLP one prices continue to pivot we drop in the future .
We expect our new strategy to continue to bear fruit in the fourth quarter as we onboard new distributors, who meet our criteria and we have been encouraged by the results we have already seen in quarter. So far.
As we announced previously we also plan to restructure our balance sheet and are on a path to being debt free we have entered into a transaction to exchange all outstanding debt for convertible preferred equity and concurrently announced a private placement financing that strengthens our financial position.
Speaker #3: Operating expenses were $10.9 million , a decrease in of expense 29% compared to the prior year . Operating loss was $9.6 million and narrowed by compared to 22% year adjusted operating expenses $8.4 million , a decrease in expense of 42% compared to the prior year Adjusted .
As we pursue FDA approval and planned U S launch of jewelry on smart capsule, we wanted to have a clear path to being debt free and this transaction provides that path.
Speaker #3: net operating loss was $6.9 million and narrowed by 39% compared to the year . prior improvements reflect the improved efficiencies we have been able to gain from the restructurings we have conducted over the past year .
Private placements further strengthens our balance sheet, helping to position us to achieve future catalysts and we were very pleased to have participation from key existing stockholders and our strategic partner, who has deep expertise in obesity.
Speaker #3: We expect our new strategy to continue to bear fruit in the fourth quarter as we onboard new distributors who meet our criteria , and we have been encouraged by the results .
Shantanu Gaur: We have also now begun process validation of a new R&D and manufacturing line in collaboration with our strategic partner. This line has the potential to expand our current capacity, reduce costs, and accelerate the implementation of design changes in the future. Regarding our clinical pipeline, we have completed submissions of the combination therapy protocol to the institutional review boards, or IRBs, for approval, fielded questions from the IRBs, and made the necessary changes to the protocol. We believe that the protocol we are testing in this study, where patients will receive the Allurion Smart Capsule, start on 0.25mg of semaglutide at the end of balloon therapy, and scale up, if needed, to 1.0mg of semaglutide over the subsequent eight months, directly addresses the issues related to high doses of GLP-1s and provides a compelling future clinical pathway for the US market.
With the stronger balance sheet I believe <unk> is better positioned to increase value for shareholders in the short and long term.
Speaker #3: We have seen in quarter so far . announced previously , we As we also plan to restructure our already balance and are on a path to being debt free .
I would like to now turn to the other two aspects of our strategy that we discussed on our last call, namely retooling, our R&D pipeline and manufacturing capabilities in collaboration with our strategic partner and bolstering our clinical pipeline with additional data on combination therapy.
Speaker #3: We have sheet entered into a transaction to exchange all outstanding debt for convertible preferred equity concurrently announced a private placement financing and strengthens our financial position as we pursue FDA approval and plan a US of the launch Smart Illyrian We wanted to have a clear path to being debt free , and this transaction provides that .
We are pleased to report that we are exploring the development of a drug eluting balloon in collaboration with our strategic partner. While this is a long term project the potential could be massive.
Speaker #3: path private placement further strengthens our balance sheet , helping to position us to achieve future catalysts . And we were very pleased to have from participation existing Capsule .
<unk>, a leading <unk> medications in a controlled release manner.
Be a game changer for obesity therapy.
Delivering GOP ones through an international balloon directly addresses the adherence challenges of <unk>, which we believe will become even more apparent with once daily pills, while directly combining two independent mechanisms of action into a single therapy.
Speaker #3: obesity . With this stronger balance sheet , I believe El-Erian is better positioned to . Increase shareholders in value for the short and long term I would like .
Shantanu Gaur: I will now turn the call over to Tara Brady, our Interim Chief Financial Officer. Tara?
Tara Brady: Thank you, Shantanu. Our revenue for the third quarter of 2025 was $2.7 million compared to $5.4 million for the same period in 2024. The year-over-year decrease in revenue was primarily due to the restructuring that took place in the third quarter. Gross profit for the third quarter was $1.3 million, or 49% of revenue, compared to $3.1 million, or 58% of revenue, for the same period in 2024, and included $0.1 million in restructuring costs. Gross profit for the third quarter was negatively impacted by the reduction in revenue in the period and lower production volumes, which resulted in less manufacturing labor and overhead being absorbed into inventory costs. Sales and marketing expenses for the third quarter were $3.1 million compared to $5.2 million for the same period in 2024, and included $1.1 million in restructuring costs.
Speaker #3: To now, the other two aspects of our strategy that we discussed on our last call, namely retooling our R&D pipeline and manufacturing capabilities in collaboration with our strategic partner, and bolstering our clinical pipeline with additional data on combination therapy.
Such an innovation could be the ideal therapy for the nearly 50% of patients who stopped using GLC ones before achieving any clinical benefit.
Second and perhaps more importantly, the drug eluting balloon could become a platform to deliver a wide array of medications supplements and microbiome enhancers that are important for gut health and the treatment of chronic gastrointestinal diseases. We believe this project also dovetails nicely with our intention to create a longer lasting.
Speaker #3: pleased to report that we are We are the development of a drug eluting balloon in collaboration with our strategic partner . While this is a long term project , the exploring potential could be massive .
Speaker #3: First, eluting GLP-1 medications controlled in a release manner could be a game changer for obesity therapy. Delivering one through an intragastric balloon directly addresses the adherence challenges of GLP-1.
Device that remains in the stomach beyond four months.
We have also now begun process validation of a new R&D and manufacturing line in collaboration with our strategic partner. This line has the potential to expand our current capacity reduce cost and accelerate the implementation of design changes in the future.
Speaker #3: which we Use , even more believe will apparent once daily pills with While directly combining two independent mechanisms of action into a therapy single , such an innovation could be the ideal therapy for nearly 50% of patients who stop using GLP one before achieving any clinical benefit .
Regarding our clinical pipeline, we have completed submission of the combination therapy protocol to the institutional review boards or <unk> for approval fielded questions from the IRB and made the necessary changes to the protocol. We believe that the protocol. We are testing in this study where patients will receive deal very honest smart capsule start on <unk>.
Tara Brady: The reduction in expense was primarily driven by increased operating efficiency in the restructuring initiatives implemented previously. Research and development expenses for the third quarter were $2.0 million compared to $3.2 million for the same period in 2024 and included $0.5 million in restructuring costs. The reduction was primarily driven by reduced costs related to the Audacity trial and restructuring initiatives implemented previously. General and administrative expenses for the third quarter were $5.8 million and included $0.9 million in restructuring costs compared to $7.0 million for the same period in 2024. Adjusted general and administrative expenses for the third quarter of 2025 were $4.9 million compared to $6.1 million for the third quarter of 2024. The reduction year-over-year was primarily driven by previous restructuring initiatives. Loss from operations for the third quarter was $9.6 million compared to $12.3 million for the same period in 2024.
Speaker #3: Second , and perhaps more importantly , eluting balloon could become the drug a platform the deliver a wide array of medications , supplements microbiome and enhancers that are important for gut and health the treatment of chronic gastrointestinal diseases .
Two five milligrams of seminal tied at the end of balloon therapy and scale up if needed to 1.0 milligrams of some of the tide over the subsequent eight months.
Speaker #3: We believe this project dovetails nicely with our intention to create a lasting solution that remains in the stomach beyond four months. We have also begun the process validation of a new R&D and manufacturing line in collaboration with our strategic partner.
<unk> addresses the issues related to high doses of <unk> and provides a compelling future clinical pathway for the U S market.
I will now turn the call over to Tara <unk>, our interim Chief Financial Officer Tara.
Speaker #3: the This line has expand our current capacity , reduce costs and accelerate the implementation of design the changes in clinical pipeline , we have submissions of the Therapy protocol combination to the Institutional review boards or IRBs for approval .
Thank you Charles Moore, our revenue for the third quarter of 2025, with $2 7 million compared to $5 $4 million for the same period in 2024.
The year over year decrease in revenue was primarily due to the restructuring that took place in the third quarter.
Speaker #3: Fielded questions from the completed the necessary changes to the protocol . We believe that the testing we are in this study , where the receive smart capsule start on 0.25mg of semaglutide at the end of the balloon therapy and scale up if to needed , 1.0mg of semaglutide over the subsequent eight months , directly issues addresses the related to high doses of GLP one and provides a compelling future clinical pathway for the US market .
Gross profit for the third quarter was $5 $3 million or 49% of revenue compared to $3 1 million or 58% of revenue for the same period in 2024 and included <unk> $1 million in restructuring costs.
Tara Brady: Adjusted loss from operations for the third quarter of 2025 was $6.9 million, excluding one-time restructuring costs of $2.7 million. Adjusted loss from operations for the third quarter of 2024 was $11.4 million, excluding one-time financing costs of $0.9 million. The reduction was driven by restructuring initiatives implemented previously. As of 30 September 2025, cash and cash equivalents were $6.1 million, not including the private placement financing of $5 million. I will now turn the call back over to Shantanu.
Gross profit for the first quarter was negatively impacted by the reduction in revenue in the period and lower production volume, which resulted in less manufacturing labor and overhead being absorbed into inventory and costs.
Speaker #3: I will now turn the over to Tara our interim chief financial officer . Tara .
Sales and marketing expenses for the third quarter were $3 $1 million compared to $5 2 million for the same period in 2024 and included $1 1 million and restructuring costs.
Speaker #2: Shantanu . Our revenue for the Thank you . third quarter of
The reduction in expenses, primarily driven by increased operating efficiency and our restructuring initiatives implemented previously.
Speaker #2: Gross profit for the third quarter was $1.3 million , or 49% of revenue , compared to $3.1 million , or 58% of revenue for the same period in 2020 .
Shantanu Gaur: Thanks, Tara. We believe the Allurion Program is the only solution for obesity management that has consistently demonstrated significant and immediate weight loss while maintaining or increasing muscle mass. In combination with low-dose GLP-1s, we believe the clinical benefit increases even more with higher levels of adherence to GLP-1s, and we are confident that by pivoting to this approach, we will capitalize on the success of GLP-1s and set Allurion up for long-term success. We are thrilled with the progress we have made in a short period of time with the FDA and remain bullish on the overall US market opportunity. As we onboard new partners outside the US, we believe we can unlock synergies with GLP-1s. In my own travels and conversations with physicians on the front lines of obesity care, even those with outstanding wraparound support have rates of discontinuation of GLP-1s above 50%.
Research and development expenses for the third quarter were $2.01 million compared to $3 2 million for the same period in 2024 and included <unk> $5 million in restructuring costs.
Speaker #2: Four. And call included $0.1 million in restructuring costs. Gross profit for the third quarter was negatively impacted by the reduction in revenue in the period, and lower production volumes, which in turn resulted in manufacturing, labor, and overhead not being absorbed into inventory costs.
The reduction was primarily driven by reduced costs related to the audacity trial and restructuring initiatives implemented previously.
General and administrative expenses for the third quarter were $5 $8 million and included <unk> $9 million in restructuring costs compared to seven point there are a million dollars for the same period in 2024.
Speaker #2: Sales and expenses for marketing the third were $3.1 million , compared to $5.2 million for the period in 2020 . Four , and included same restructuring .
Adjusted General and administrative expenses for the third quarter of 2025, or $4 9 million compared to $6 $1 million for the third quarter of 2024.
Speaker #2: costs reduction in expense was primarily driven by increased operating efficiency in the restructuring initiatives implemented previously Research and development . For the third quarter were $2.0 million , expenses .
The reduction year over year was primarily driven by previous restructuring initiatives.
Loss from operations for the third quarter was $9 $6 million compared to $12 $3 million for the same period in 2024.
Shantanu Gaur: We believe this population of patients represents a substantial opportunity for Allurion. Finally, as we explore next-generation R&D and manufacturing initiatives with our new strategic partner, we have begun to view the Allurion Smart Capsule as more of a platform technology that could deliver drugs of all kinds, not just GLP-1s, to address adherence issues that are inherent to pharmacotherapy. We believe that with this approach, we could build a new standard of care in not only obesity management, but also across several other disease areas, and we are looking forward to proving this out in the future. With that, Operator, please open up the call for questions.
Speaker #2: compared to $3.2 million for the same period in 2024 , and included $0.5 million in restructuring costs . reduction was primarily driven by reduced costs related to the audacity trial and restructuring initiatives previously implemented General .
Adjusted loss from operations for the third quarter of 2025 was $6 $9 million, excluding onetime restructuring costs of $2 $7 million.
Adjusted loss from operations for the third quarter of 2024 was $11 $4 million, excluding onetime financing costs of <unk> $9 million.
Speaker #2: and for the expenses third quarter administrative were $5.8 million , and included restructuring $0.9 million in costs , compared to $7.0 million for the same period in 2020 .
The reduction was driven by restructuring initiatives implemented previously.
Speaker #2: For adjusted general and administrative expenses for the third quarter of 2025 were $4.9 million , compared $6.1 million to third quarter of 2024 .
As of September 30th 2025, cash and cash equivalents were $6 $1 million not including the private placement financing of $5 million.
Operator: We will now begin the question-and-answer session. If you would like to ask a question at this time, just press star, then the number one on your telephone keypad. Our first question comes from the line of Joshua Jennings with DD Cohen. Joshua, please go ahead.
I will now turn the call back over to Sean to now.
Speaker #2: The reduction year over year was primarily driven by restructuring initiatives. The loss from operations in the third quarter was $9.6 million, compared to $12.3 million for the same period in 2020.
Thanks, Tara we believe the ovarian program is the only solution for obesity management that has consistently demonstrated significant and immediate weight loss, while maintaining or increasing muscle mass in combination with low dose <unk>. We believe the clinical benefit increases even more with higher levels of adherence to <unk> and we are key.
Speaker #2: For adjusted loss from operations for the third quarter of 2025 was $6.9 million , excluding one time restructuring costs of $2.7 million , adjusted loss from operations for the third quarter of 2024 was $11.4 million .
Joshua Jennings: Hi. Good morning. Thanks for taking the questions. Shantanu, congrats on the progress with the FDA process. Just thinking about that progress, I wanted to start with how you're taking the learnings from the international strategy to focus on accounts that offer comprehensive obesity care and how that's informing potential US commercial strategy. Any updates just on how Allurion plans to attack the US market once approval's in hand?
<unk> that by pivoting to this approach we will capitalize on the success of <unk> and set <unk> up for long term success.
Speaker #2: Excluding one time financing costs of $0.9 million . The driven by reduction was restructuring initiatives implemented previously . September 30th , 2025 , cash and cash equivalents were $6.1 million , not private placement financing of including the $5 million .
We are thrilled with the progress we have made in a short period of time with the FDA and remain bullish on the overall U S market opportunity as.
As we onboard new partners outside the U S. We believe we can unlock synergies with <unk>.
And my own travels in conversations with physicians on the frontline that obesity care, even those with outstanding wraparound support have rates of discontinuation of <unk> above 50%. We believe this population of patients represents a substantial opportunity further out.
Shantanu Gaur: Thanks for the question, Josh. Certainly, we're learning a lot from what we are doing internationally, especially after we made this most recent pivot in our strategy. What we're seeing in our direct accounts is that as accounts embrace and utilize GLP-1s more and more, they are creating new patients as those GLP-1 patients discontinue and then look for alternative therapies. I was in Ireland a few weeks ago discussing this concept with one of the best GLP-1 clinics in the entire country of Ireland. Even with exceptional care, with multidisciplinary support across nutrition, physical activity, exercise, and psychological support, this particular clinic still had a churn rate over 50% at one year. Half of their patients were churning off of GLP-1s, regaining weight, and then coming back looking for another therapy.
Speaker #2: I will now turn the call to .
Speaker #2: I will now turn the call to . Shantanu Thanks ,
Speaker #3: Tara . We believe the program is the only solution for obesity As of management that has
And finally, as we explore next generation R&D and manufacturing initiatives with our new strategic partner, we have begun to view the old around smart capsule as more of a platform technology that could deliver drugs of all types not just <unk> to address adherence issues that are inherent to pharmacotherapy, we believe that with this approach we could.
Speaker #3: combination with low dose increasing GLP one . We clinical benefit increases even more with higher levels of adherence to GLP one , and we are weight confident that by pivoting to this approach , we will the capitalize on success of one and GLP set a for long term success .
Build a new standard of care and not only obesity management, but also across several other disease areas and we're looking forward to proving this out in the future.
Speaker #3: we can unlock synergies with We GLP one . opportunity my own travels and In conversations with physicians on the front lines of obesity care , even those with outstanding wraparound support have rates of discontinuation of GLP one above 50% .
With that operator, please open up the call for questions.
We will now begin the question and answer session. If you would like to ask a question at this time just press Star then the number one on your telephone keypad.
Speaker #3: We believe this population of patients represents a substantial opportunity for El-Erian finally , . explore as we next generation R&D and initiatives with manufacturing our new strategic partner , we have begun to view the Eulerian Smart Capsule as more of a platform technology that could deliver drugs of all kinds , not just GLP one .
And our first question comes from the line of Joshua Jennings with Cowen Joshua. Please go ahead.
Shantanu Gaur: We're seeing this across the board in all of the international markets that we operate in. That's one learning that we're going to apply in the US market. We've already begun to map out which clinics in the United States fit the bill in terms of utilizing GLP-1s and also being equipped to potentially deploy the Allurion Smart Capsule. In our international markets as well, we're seeing the same uptake in distributor markets where the distributors have access to accounts that are providing comprehensive obesity care. We intend over the next couple of months to strike some new partnerships with distributors in certain regions that clearly have embraced GLP-1s and combination therapy, and are seeing in their own businesses how those patients filter through the funnel and get other therapies down the line.
Hi.
Hey, good morning, Thanks for taking my questions.
So congrats on that.
Progress with the FDA process.
Thinking about the product.
Chris.
Speaker #3: To address adherence issues that inherent to pharmacotherapy . We believe that with this approach , we could build a new standard of care and not only management , but also across several other disease areas .
I wanted to start with just how you are taking the learnings from the international strategy to focus on accounts that can offer comprehensive obesity care and how that's informing the potential U S commercial strategy if any.
Speaker #3: And we are looking forward to proving this out in the future . With that , operator , please open up the call for questions .
Okay system on how.
Good morning, and plan to attack this market once approvals in hand.
Thanks for the question Josh.
Speaker #1: We will now begin the question and answer session . If you would like to ask a question at this time , just press star .
We're learning a lot from what we are doing internationally, especially after we made this most recent pivot in our strategy what we're seeing in our direct accounts is that.
Speaker #1: Then the number one on your telephone keypad first question comes from the line of Joshua Jennings with Cohen . TD Joshua . Please go ahead .
<unk> accounts, and Grace and utilized <unk> more and more they are creating new patients.
Speaker #4: Hi . Good . Good morning . Thanks for taking the . questions . Shantanu Gaur congrats on the progress with the FDA process .
Speaker #4: Hi . Good . Good morning . Thanks for taking the . questions . Shantanu Gaur congrats And our just thinking about that progress .
Joshua Jennings: Thanks for that. Just thinking about the international push and the strategic pivot, the solid third-quarter revenue results, help us just think about the progression from here as we're thinking about modeling Q4 and 2026, just how international revenues could shape up over the next 12 to 24 months.
Those geographies, one patient discontinue and then look for alternative therapies.
In Ireland, a few weeks ago discussing.
This concept with one of the best.
<unk> clinics in the entire country of Ireland.
Even with exceptional care.
With multi disciplinary support across nutrition physical activity exercise even psychological support.
Shantanu Gaur: Yeah, great question. What we're seeing right now in the fourth quarter is continued growth in the direct markets where we are seeing an embrace of combination therapy and GLP-1s. Similarly, in our distributor markets where we have either launched a new distribution partner or refocused our existing distributors on our new strategy, we're seeing some nice momentum there as well. I would expect in the fourth quarter sequentially to grow compared to Q3. Moving into 2026, I do expect that sequentially we should be able to continue to grow the top-line revenue for the business as more and more of these clinics start to embrace GLP-1s and combination therapy.
This particular clinics still had a churn rate over 50% in one year. So half of their patients. We're churning off of <unk> regaining weight and then coming back looking for another therapy and we're seeing this across the board in all of the international markets that we operate in so that's one learning that we're going to apply.
In the U S market and we've already begun to map out.
<unk> clinics in the United States.
The bill in terms of utilizing the <unk> ones and also being equipped to potentially deploy jewelry on smart capsule.
In our international markets as well, we're seeing the same uptake in distributor markets, where the distributors have access to accounts that are providing comprehensive obesity care and we intend over the next couple of months.
Shantanu Gaur: The other thing that we're starting to see is that as new GLP-1 agents come to market or as prices drop, we see that there's more utilization of GLP-1s, and ironically, there is actually more discontinuation because many of these new agents or less expensive agents are being delivered without the appropriate care. I actually expect that this trend that we are seeing now in 2025 should continue into 2026. Coming back to your point on the US market as well, Josh, with some of the new initiatives from the Trump administration that are resulting in a reduction in price in GLP-1s in the US, that should drive more uptake in the US, which in turn should drive a higher churn rate and even more patients who are looking for alternative therapies after they stop their GLP-1 and regain the weight.
To strike some new partnerships with distributors in certain regions that clearly have embraced <unk> ones in combination therapy and are seeing in their own businesses, how those patients filter through the funnel and get other therapies down the line.
Thanks for that and just thinking about the international.
And this strategic pivot.
Solid third quarter revenue results and help them.
Just thinking about the progression from here and just thinking about <unk>.
<unk> <unk> in 2026.
Our international revenues could shape up.
Over the next 12 to 24 months.
Yes, great question, what we're seeing right now in the fourth quarter is continued growth.
The direct markets, where we are.
Shantanu Gaur: These are some of the tailwinds that I see now finally behind our backs as we head into 2026.
And embrace a combination therapy in GOP ones. Similarly in our distributor markets, where we have either launched a new distribution partner or.
Joshua Jennings: Appreciate that. Just lastly, you're talking about Allurion Smart Capsule as potentially transforming into a platform technology with drug delivery. Any other details to share just in terms of timelines of the development program? Any other elements of the pipeline that you want to highlight in terms of development projects for the platform? Thank you.
We focused our existing distributors on our new strategy, we're seeing some nice momentum there as well so I would expect in the fourth quarter sequentially to grow compared to Q3.
Then moving into 2026, I do expect that sequentially, we should be able to continue to grow the top line revenue for the business as more and more of these clinics start to embrace GLC ones in combination therapy. The other thing that we're starting to see is that as <unk>.
Shantanu Gaur: Thank you. When we think about the Smart Capsule as more of a platform, there's actually a whole universe of molecules and even gut microbiome enhancers that could be eluted off of our balloon in a controlled-release manner. What we're finding, especially as GLP-1s proliferate and some of these other pharmaceuticals that are delivered through DTC services where the follow-up is pretty limited, is that adherence has become the number one issue for pharmaceuticals. With a capsule like ours that turns into a balloon that lasts inside the stomach for four months, we can solve that adherence issue for patients over a four-month period. We're also reinitiating the work that we had started a year ago or so on a longer-term balloon that's intended to last in the stomach well beyond four months.
<unk> agents come to market or as prices drop.
We see that there's more utilization of <unk> and ironically.
There is actually more just continuation because many of these new agents or less expensive agents.
Are being delivered without the appropriate care. So I actually expect that this trend that we're seeing now in 2025 should continue into 2026 and coming back to your point on the U S market as well Josh.
With some of the new initiatives from the Trump administration that are resulting in a reduction in price and <unk> in the U S that should drive more uptake in the U S, which in turn should drive a higher churn rate.
Even more patients who are looking for alternative therapies. After they stopped their G. L. P. One and regain the weight. So these are these are some of the tailwind that I see now finally behind our backs as we head into 2026.
Shantanu Gaur: The vision there potentially as a platform could be you swallow, a patient swallows a Smart Capsule of ours. It remains in the stomach for, say, 12 months, and over that 12-month period, drug, therapeutic, or a gut microbiome enhancer is eluted over time. In that scenario, you could imagine a patient being able to swallow a capsule once a year and really not have to worry about taking their medications or managing their obesity since they have an intragastric balloon inside their stomachs. That is a longer-term project, and we're really thrilled to be initiating it right now. When you combine that drug-elution approach with a longer-term intragastric balloon, the opportunities actually become sort of endless in terms of how many different therapeutics or small molecules we could potentially elute in patients with various different chronic diseases.
I appreciate that and then just lastly.
You're talking about.
Around smart capsule potentially transform major platform technology, we can delivery.
And then any other.
Details to share just in terms of timelines of the development program and then any other elements of the pipeline that you want to highlight.
Development projects.
Thank you.
Thank you when we think about the smart capsule is more of a platform.
There is actually a whole universe.
Molecules and even got it.
Microbiome enhancers that could be alluded also our balloon in a controlled release manner and what we're finding especially as <unk> proliferate and some of these other pharmaceuticals that are delivered through <unk>.
<unk> services, where the follow up is pretty limited adherence has become the number one issue for pharmaceuticals, and with a capsule like ours that turned into a balloon that last inside the stomach for four months, we can solve that adherence issue for patients over a four month period. We're also.
Operator: If you would like to ask a question, simply press star followed by the number one on your telephone keypad. There are no further questions at this time, and I will now turn the call back over to Shantanu Gaur for closing remarks. Shantanu?
B initiating the work that we had started.
A year ago or so on the longer term.
That's intended to us in the stomach well beyond four months and the vision there potentially as a platform could be you swallow patients while those.
Shantanu Gaur: Thank you, Operator. As we close our call today, I'd just like to extend my thanks to everyone who joined us today, particularly all of my fellow Allurions who are building this next generation of Allurion. Of course, our loyal shareholders, the collective belief that all of you have in our mission and commitment to our company has really been unwavering. I believe through that commitment, we have set ourselves up for long-term success. We really look forward to updating all of you on our progress in the next quarter. Thank you all. Have a great day.
Heart capsule of ours. It remains in the stomach for say 12 months and over that 12 month period drug.
A few days or a gut microbiome and answer as alluded overtime.
And in that scenario, you could imagine a patient being able to swallow a capsule once a year and really not have to worry about taking their medications or managing their obesity east as they have an intra gastric balloon inside their stomachs. So that is a longer term project.
Operator: That concludes today's call. You may now disconnect.
And we're really thrilled to be initiating it right now, but when you combine that drug elution approach with a longer term intra gastric balloon the opportunities actually become sort of endless in terms of how many different therapeutics or small molecules, we could potentially yogurt.
In patients with various different chronic diseases.
Again, if you would like to ask a question press star followed by the number one on your telephone keypad.
Yeah.
Okay.
Okay.
Okay.
Yeah.
There is no further questions at this time and I will now turn the call back over to <unk> for closing remarks Shannon.
Thank you operator, as we close our call today I'd just like to extend my thanks to everyone, who joined US today, particularly all of my fellow <unk>, who are building. This next generation of ovarian and of course, our loyal shareholders.
The collective belief that all of you have in our mission and commitment to our company has really been unwavering and I believe through that commitment. We have set ourselves up for long term success, we really look forward to updating all of you on our progress in the next quarter and thank you all have a great day.
That concludes today's call you may now disconnect.