PROCEPT BioRobotics Q1 2025 Earnings Report

PROCEPT BioRobotics EPS Results

• Actual EPS: -$0.45
• Consensus EPS: -$0.49
• Beat/Miss: Beat by +$0.04
• One Year Ago EPS: -$0.51

PROCEPT BioRobotics Revenue Results

• Actual Revenue: $69.16 million
• Expected Revenue: $65.39 million
• Beat/Miss: Beat by +$3.77 million
• YoY Revenue Growth: +55.50%

PROCEPT BioRobotics Announcement Details

• Quarter: Q1 2025
• Date: 4/24/2025
• Time: Before Market Opens
• Conference Call Date: Thursday, April 24, 2025
• Conference Call Time: 8:00AM ET

PROCEPT BioRobotics (NASDAQ:PRCT), a surgical robotics company, focuses on developing transformative solutions in urology in the United States and internationally. The company develops, manufactures, and sells AquaBeam Robotic System, an image-guided, surgical robotic system for use in minimally invasive urologic surgery with a focus on treating benign prostatic hyperplasia (BPH). It also designs Aquablation therapy for males suffering from lower urinary tract symptoms due to BPH. PROCEPT BioRobotics Corporation was incorporated in 2007 and is headquartered in San Jose, California.

PROCEPT BioRobotics Q1 2025 Earnings Call Transcript

Presentation

[Operator]

Good morning, and welcome to Procept BioRobotics First Quarter twenty twenty five Earnings Conference Call. At this time, all participants are in a listen only mode. We will be facilitating a question and answer session towards the end of today's call. As a reminder, this call is being recorded for replay purposes. I would now like to turn the call over to Matt Bakso, Vice President, Investor Relations for a few introductory comments.

[Matt Bacso, VP - Investor Relations and Business Operations at PROCEPT BioRobotics]

Good morning and thank you for joining Procept BioRobotics first quarter twenty twenty five earnings conference call. Presenting on today's call are Reza Zadno, Chief Executive Officer Kevin Waters, Chief Financial Officer and Sham Shiblak, Chief Commercial Officer. Before we begin, I'd like to remind listeners that statements made on this conference call that relate to future plans, events or performance are forward looking statements as defined under the Private Securities Litigation Reform Act of 1995. While these forward looking statements are based on management's current expectations and beliefs, these statements are subject to several risks, uncertainties, assumptions and other factors that could cause results to differ materially from the expectations expressed on this conference call. These risks and uncertainties are disclosed in more detail in Procept Biorobotics' filings with the Securities and Exchange Commission, all of which are available online at www.sec.gov.

[Matt Bacso, VP - Investor Relations and Business Operations at PROCEPT BioRobotics]

Listeners are cautioned not to place undue reliance on these forward looking statements, which speak only as of today's date, 04/24/2025. Except as required by law, Presset BioRobotics undertakes no obligation to update or revise any forward looking statements to reflect new information, circumstances or unanticipated events that may arise. During the call, we will also reference certain financial measures that are not prepared in accordance with GAAP. More information about how we use these non GAAP financial measures as well as reconciliations of these measures to their nearest GAAP equivalent are included in our earnings release. With that, I'd like to turn the call over to Reza.

[Reza Zadno, President & CEO at PROCEPT BioRobotics]

Good morning, and thank you for joining us. For today's call, I will provide opening comments and a general business update followed by Sham, who will provide a commercial overview. Lastly, Kevin will provide additional detail regarding our financial performance and updated 2025 financial guidance. Beginning with our quarterly revenue results. Total revenue for the first quarter of twenty twenty five was $69,200,000 representing growth of 55% compared to the first quarter of twenty twenty four.

[Reza Zadno, President & CEO at PROCEPT BioRobotics]

Growth in the quarter was driven by increased US systems and handpieces sold as well as record international revenues. We exited the first quarter of twenty twenty five with a US installed base of 547 systems, representing growth of 55% compared to the prior year period. We sold a total of 43 robotic system in the first quarter of twenty twenty five. Turning to the global macro environment, specifically our exposure to tariffs. As a reminder, following the establishment of full Medicare coverage in 2021, we initiated US commercial operations in earnest at a time when the pandemic has exposed significant vulnerabilities in the global supply chain.

[Reza Zadno, President & CEO at PROCEPT BioRobotics]

In response, we took proactive steps to derisk our supply chain by sourcing the majority of our strategic components in The US. For components that could not be sourced within The US, we took deliberate steps to maintain significant inventory levels. This approach not only mitigated the risk of supply disruption, but also helped reduce our exposure to potential tariff escalations. For example, greater than 95% of the direct material cost of our single use handpiece is sourced in The United States. Regarding our robotic system, our primary exposure to China lies in the ultrasound system.

[Reza Zadno, President & CEO at PROCEPT BioRobotics]

However, we have typically maintained a robust supply of inventory for this critical component. Kevin will provide additional detail in the guidance section. However, given our strong inventory position of ultrasound units and the fact that all products are assembled in California, we currently anticipate only a modest impact to twenty twenty five gross margin. That said, we have taken a conservative approach to our 2025 gross margin outlook and will continue to closely monitor potential headwinds that could affect fiscal twenty twenty six. Turning to clinical updates.

[Reza Zadno, President & CEO at PROCEPT BioRobotics]

In March, at the fortieth Annual European Association of Urology Congress in Madrid, primary endpoint results from the WATER three randomized controlled trial were presented. WATER three is an international prospective, multicentiled study comparing aquablation therapy for laser enucleation in prostate sizes 80 to 180 milliliters. This study treated one hundred and eighty six men and reported three months primary safety and efficacy endpoints. WATER three will also follow patients up to five years. At three months, coagulation therapy delivers similar symptom relief to laser enucleation while demonstrating a zero percent transfusion rate and significantly lower rates of ejaculatory dysfunction and incontinence.

[Reza Zadno, President & CEO at PROCEPT BioRobotics]

Notably, the rate of stress incontinence was zero percent among aquablation patients. These results add to our growing body of clinical evidence and support that aquablation therapy is highly reproducible in treating prostates of all sizes with a low learning curve. Aside from the clinical outcomes, we believe the WATER three results will be instrumental in helping modify global urology guidelines in the future for larger prostates. Next, I want to provide a positive update regarding US Medicare coverage. Effective 04/06/2025, First Coast and Novitas, '2 of the largest regional Medicare administrative contractors, positively updated two key local coverage determinations or LCDs.

[Reza Zadno, President & CEO at PROCEPT BioRobotics]

We estimate First Coast and Novitas account for approximately thirty percent of all Medicare patients in The United States. Regarding the LCD changes, First Coast and Novitas removed three key limitations, age based restrictions for men 80, voided volume thresholds that impacted patient in retention, and the requirement to measure prostate size via transtrectal ultrasound. These changes significantly streamlined the pre procedure workup and should expand access to our population therapy for a broader patient population. With that, I will turn the call over to Sham to provide more detail on first quarter commercial performance.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

Thanks, Reza. Starting with US procedures, in the first quarter we sold 11,235 handpieces, handpieces representing year over year unit growth of 65%. As we noted during our fourth quarter earnings call, we experienced some residual impact from the saline shortage in January. However, volumes returned to more normalized levels in February, with March demonstrating strong growth compared to the prior month. As of the March, we believe the failing issue is behind us.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

The first quarter of twenty twenty five was an incredibly important quarter for the company to execute our plan, given the macro factors from the fourth quarter. In addition to a strong handpiece quarter, we saw a greater number of accounts launch their off ablation program in the first quarter compared to any previous quarter. As I look back over the last quarter, there are three key takeaways regarding the high dose account launches. First, internally we proved we can execute supporting a large number of new accounts on accelerated timelines. Second, hospital customers are very motivated to launch and promote their hydro system.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

And finally, given the number of accounts that were launched in the first quarter and the daily procedure normalization post saline, we have a high degree of confidence we will continue our procedural and system momentum as we progress through 2025. Turning to hydros with the launch of hydros last year, we've seen a noticeable increase in engagement with large strategic IDMs and based on the feedback we have received, we believe momentum is being enhanced by a few key factors. First, with the size of our installed base and the growth across hospitals and procedures, many of these new hospitals now view Procept as being on par with the most well established med tech companies in The US. Second, they see hydro as a potentially game changing technology, bringing advanced capabilities to a large established surgical category that has been stagnant for years. And third, we're hearing a strong desire to standardize off ablation therapy across their hospital networks, driven by the consistent reproducible outcomes and the operational efficiency that brings.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

Many of these IDNs have also expressed a strong interest in growing patient volumes and view hydros as an enabling technology to support that goal. Of the 43 systems sold in the first quarter, approximately 45% were associated with IDM Bulk Vies executed at the corporate level. Furthermore, approximately half of hydros placements went to high volume hospitals, with the other half being low or medium volume hospitals. Given this dynamic, we believe hydro is resonating with large strategic IDN and hospital and all hospitals, regardless of historical volume. Regarding the broader capital equipment environment, while market uncertainties present challenges, we have demonstrated a strong track record of selling capital and incrementally higher prices driven by the underlying value of off ablation therapy to the patient and hospital customers.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

Based on daily conversations with prospective customers in our pipeline, we do not sense any material shift in overall sentiment. We believe Prozep is in a strong position to continue to grow the installed base for the foreseeable future. Many hospitals associate robotic surgery as a long term strategic priority to grow revenue and market share, and thus are less likely to cut investment in this area, even if macro conditions moderately worsen. Second, we are

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

in the early innings of

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

a new product launch that is gaining traction. The number of low and medium volume BPH hospitals acquiring hydro systems continues to increase, giving us confidence in our ability to expand into these hospital segments and continue on our path to becoming the BPH standard of care. Lastly, want to touch briefly on our international performance. International revenue in the first quarter of twenty twenty five was $8,900,000 representing growth of 104% compared to the prior year period. While our international business remains primarily driven by capital sales, we are beginning to see meaningful revenue tailwinds from procedural volumes, particularly in The United Kingdom, where increasing utilization is becoming a meaningful driver of the overall business.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

This is very encouraging as we now have many examples across The UK of launching robust and durable population programs in both the NHS and private sector. These real world examples are critical as we continue to sell throughout The UK. With that, I will turn the call over to Kevin.

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

Thanks, Sham. Total revenue for the first quarter of twenty twenty five was $69,200,000 representing growth 55% compared to the first quarter of twenty twenty four. U. S. Revenue for the first quarter was $60,300,000 representing growth of 50% compared to the prior year period.

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

We generated total U. S. System revenue of $18,700,000 representing system revenue growth of 32% compared to the first quarter of twenty twenty four. In the first quarter, we sold 43 robotic systems at a blended average selling price of approximately $435,000 Looking ahead, we expect a small percentage of Hydro's placements to come from legacy AquaBeam system replacement. In these cases, particularly with established customers, we anticipate pricing to be largely consistent with that of a new system.

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

Notably, during the quarter, one customer replaced our AquaBeam for hydros. As a result, while 43 systems were sold, The U. Installed base grew by 42 units, reaching a total of five forty seven systems. This reflects continued momentum in system adoption and the value customers place on our next generation technology. Turning to U.

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

S. Handpiece and consumable revenue. Revenue for the first quarter of twenty twenty five was $38,000,000 representing growth of 61% compared to the first quarter of twenty twenty four. The 11,235 handpieces sold in The United States were at average selling prices of approximately $3,200 representing unit growth of 65% compared to the first quarter of twenty twenty four. We also recorded approximately $2,100,000 of other consumable revenue in the first quarter of twenty twenty five.

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

International revenue in the first quarter of twenty twenty five was $8,900,000 representing growth of 104% compared to the prior year period. Growth in the first quarter was once again driven primarily by strong sales momentum in The United Kingdom. Gross margin for the first quarter of twenty twenty five was 63.9% consistent with the fourth quarter of twenty twenty four and up seven fifty basis points year over year. The year over year margin expansion was driven primarily by improved operational efficiencies and higher average selling prices compared to the first quarter of twenty twenty four. Moving down the income statement.

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

Total operating expenses for the first quarter of twenty twenty five amounted to $71,600,000 compared to $52,700,000 during the same period in the prior year. We believe our path to profitability is becoming increasingly clear as reflected in our recent performance. This clarity is driven by our gross margin expansion into the mid 60% range, which is a direct result of our ability to leverage existing overhead at higher revenue levels along with increased average selling prices for systems and handpieces. Net loss was $24,700,000 for the first quarter of twenty twenty five compared to $26,000,000 in the same period of the prior year. Adjusted EBITDA was a loss of $15,800,000 compared to a loss of $20,400,000 in the first quarter of twenty twenty four.

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

Our cash, cash equivalents and restricted cash balances as of March 31 were approximately $319,000,000 Moving to our 2025 financial guidance. We now expect full year 2025 total revenue to be approximately $323,000,000 representing growth of approximately 44% compared to 2024. We continue to expect to sell approximately two ten new robotic systems in The United States with pricing in the range of $430,000 to $440,000 Our primary focus in 2025 remains on the substantial opportunity to sell hydros and greenfield accounts. However, we are also seeing interest from existing customers who are looking to either replace their current AquaBeam system or acquire a second system, which would be hydros. Therefore, we are guiding the total full year US system revenue of approximately $95,000,000 which includes greenfield sales and to a lesser extent replacement system.

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

We continue to believe that the replacement opportunity will serve as a significant long term driver for the business, although we are still in the early stages of the adoption curve. Turning to US handpieces. For the full year, we continue to expect sales of approximately 52,500 handpieces, representing a 63% increase in unit volume compared to 2024. We remain confident in our visibility into new account launches and quarterly procedure volumes, which contributed to our outperformance in the first quarter. We are maintaining handpiece average selling prices to be approximately $3,200 and are increasing other consumable revenue expectations to be approximately $9,000,000 for the full year.

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

Additionally, we expect U. S. Service revenue to now be approximately $16,000,000 for the full year. Lastly, on international revenue, given strong positive momentum in The United Kingdom, we now expect full year international revenue to be approximately $34,500,000 representing annual growth of 44%. Turning to gross margins, the current tariff landscape remains highly fluid.

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

That said, we believe we are well positioned to manage both gross margins and overall profitability in this environment. To clarify our exposure, tariffs primarily impact our ultrasound system and associated component source from China. Should current rates remain elevated at 145%, we estimate a potential gross margin headwind of approximately $5,000,000 in 2025, which would equate to a 150 basis point reduction from our guidance of 64.5%, with the majority of the impact expected in the second half of the year. While we believe there's a reasonable likelihood that tariffs could moderate over time, we felt it important to outline the potential downside scenario could rates remain unchanged. Although we are not yet providing guidance for 2026, we are actively evaluating operational mitigation strategies that could reduce future exposure.

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

Importantly, we remain confident that the current tariff environment does not compromise our path to achieving our long term profitability objectives. We will continue to closely monitor developments and provide timely updates as needed. Turning to operating expenses, we continue to expect full year 2025 operating expenses to be approximately $300,000,000 representing growth of 28% over 2024. In the second quarter of twenty twenty five, our operating expense guidance assumes spend of approximately $75,000,000 Additionally, given current interest rates and cash balances, we expect full year interest and other income of approximately $9,400,000 Taking all relevant factors into account, we continue to anticipate a full year 2025 adjusted EBITDA loss of approximately $35,000,000 We believe potential tariff related headwinds can be largely mitigated through operational efficiencies identified across the organization. At this point, I'd like to turn the call back to Reza for closing comments.

[Reza Zadno, President & CEO at PROCEPT BioRobotics]

Thanks, Kevin. In closing, I want to provide a brief preview of AUA. We are currently in Las Vegas for the twenty twenty five AUA conference, and it is also Procept's fourth consecutive AUA Analyst Day. Tomorrow, we will be video webcasting the event live starting at 8AM Pacific, eleven AM eastern. From a logistics point of view, it is very important to note that the location of our event has been moved to the Aria Hotel in Conference Room Joshua 9 And 10.

[Reza Zadno, President & CEO at PROCEPT BioRobotics]

If you are planning to attend in person, please update your meeting location to the ARIA hotel. Tomorrow will be an exciting event for Procept as this will be the first year we present prostate cancer results for aquablation from a combination of both of our trials, PRCT zero zero one and PRCT zero zero two. The data we plan to present will include procedural anatomical capabilities and safety functional outcomes with respect to the incontinence and erectile function and oncologic control. Given the reproducible nature of our procedure and its safety profile seen during the treatment of BPH, we believe tomorrow's Analyst Day will provide a glimpse into the future as to how low and intermediate risk prostate cancer patients could be treated. Furthermore, we are the first company ever to receive IDEA approval from the FDA to enroll a randomized trial comparing surgical therapy against radical prostatectomy for prostate cancer.

[Reza Zadno, President & CEO at PROCEPT BioRobotics]

We view this as the first crucial step in pursuing a specific prostate cancer treatment indication, which no other treatment has today. Given the amount of level one clinical evidence we will be gathering over the next few years, along with our breakthrough device designation to fast track approval, we believe we will be in an advantageous position to drive rapid change in a massively underserved market. To conclude my prepared remarks, we are seeing multiple factors continue to trend positively, allowing us to execute our long term strategic plan. In summary, The US Hydros launch is gaining momentum with our pipeline and sales funnel growing nicely. We launched significantly more greenfield accounts in the first quarter compared to any other quarter.

[Reza Zadno, President & CEO at PROCEPT BioRobotics]

We exited March with very strong procedural momentum and view the sailing disruption to be behind us. We feel very confident in delivering another year of strong procedure growth. Our international business continues to build momentum in The UK. We are the first company ever to receive ID approval from the FDA to enroll a randomized trial comparing a surgical therapy against radical prostatectomy for prostate cancer. Lastly, based on current inventory levels and limited exposure to foreign suppliers, we believe the impact of tariffs on 2025 gross margins to be very manageable, and we have reiterated our adjusted EBITDA guidance for fiscal twenty twenty five.

[Reza Zadno, President & CEO at PROCEPT BioRobotics]

We believe these underlying fundamentals reflect the technology that is laying the foundation to become the BPH surgical standard of care and a business that will be a leading global urology company. In closing, I want to thank our employees, customers, and shareholders for all their support to help us along our journey to becoming the standard of care for BPH. At this point, we will take questions. Operator?

[Operator]

Thank you. To ask a question, you will need to press 11 on your telephone and wait for a name to be announced. To withdraw your question, please press 11 again. Please stand by while we compile the q and a roster. One moment for our first question.

[Operator]

Our first question will come from the line of Matthew O'Brien from Piper Sandler. Your line is open.

[Matt O'Brien, Analyst at Piper Sandler Companies]

Good morning. Can you guys hear me okay?

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

Good, Matt.

[Matt O'Brien, Analyst at Piper Sandler Companies]

Excellent. Thanks for the questions.

[Matt O'Brien, Analyst at Piper Sandler Companies]

For starters, just would love to hear and I think Shem kind of started to address it a little bit, but just love to hear a little bit more about the CapEx environment. It's coming up in every conversation I everybody is having at this point in terms of the environment potentially slowing with Medicaid cuts, etcetera. But you just had your best greenfield quarter ever. So maybe just talk a little bit about what you're seeing in the market in terms of buyer interest in the system and then conversion rates versus what you were kind of expecting if anybody is kind of slowing things down just given the environment or even canceling converting over? Just a bigger discussion on what you're seeing on the CapEx side because, again, I think it's getting quite a bit of attention.

[Matt O'Brien, Analyst at Piper Sandler Companies]

And then I do have one follow-up.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

Hey. Hi, Matt. It's Sham. Thanks for the question. So I would start by saying, we haven't seen, an impact when it comes to our capital interest in the hospital interest in acquiring hydros.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

We have, you know, daily conversations. Our pipeline is at an all time high when we look at opportunities that have now, entered the buying process for hydros. So we haven't seen any material shift in the sentiment as far as the, excitement around acquiring our technology. But one thing I think we are different, I mean, we're in a unique position. We're still early innings when it comes to the opportunity we have with the number of hospitals that still remain.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

And we're talking about thousands of hospitals that still haven't acquired, AquaBeam, or Hydrus at this point. And, and we're we're continuing to build the pipeline. The other thing is, due to the disruptive nature of this technology, due to the adoption with procedures, we now have patients demanding the technology. Surgeons, hospitals don't want to lose those patients. And, we're in a unique position right now to continue to grow that pipeline and the reimbursement supports the procedure as well.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

So there's a lot of things going in our favor even in this environment. And last thing I mentioned is the relationship with IDNs continues to strengthen. We talk about this routinely. We're at a point now where we're being invited to corporate environments where we have, key executives at large IDNs talking to us about long term strategy. All those things play into our favor, over the course of this year and the future.

[Matt O'Brien, Analyst at Piper Sandler Companies]

Got it. Appreciate that feedback. And then the second one is really on the handpiece side. That was really strong in the quarter. And I know there was probably some deferral of cases in Q4.

[Matt O'Brien, Analyst at Piper Sandler Companies]

I know that's been difficult to figure this out. But how many of those may have gotten pushed from Q4 into Q1? Or are there other dynamics underlying this that are just even stronger in terms of maybe market share in certain geographies that are looking above what you had initially anticipated, again, given how strong the hemp piece number was Thanks.

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

Yes, thanks, Matt. This is Kevin. So you're correct. We did see some impact from deferrals in the fourth quarter, but those were largely offset by the sailing impact that still lingered into January and February. So I would characterize that dynamic as net neutral for procedures in Q1, which really means the Q1 procedures are just driven by the strength of the business as opposed to backlog coming into Q1, which was offset by the continued weakness into January and lingering into February.

[Matt O'Brien, Analyst at Piper Sandler Companies]

Thank you.

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

Thanks.

[Operator]

Thank you. One moment for our next question. Our next question will come from the line of Craig Bijou from Bank of America Securities. Your line is open.

[Craig Bijou, Equity Research Analyst at Bank of America Securities]

Good morning, guys. Thanks for taking the questions and congrats on the strong start to the year. I wanted to follow-up on Matt's question on handpieces and maybe ask in a slightly different way, but I know you called out March as kind of getting back to normal. And I wanted to see if maybe you could provide a little bit more color on what the procedure volume growth was in March, at least directionally versus some of the other quarters and maybe how we should think about utilization in March and how that carries forward for the rest of the year?

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

Yeah, I'll start and maybe I'll let Sam come in. But we were really pleased with kind of return to normalcy in March coming out of the January and February lingering impacts from saline. Moving forward, our guidance in Q2 and Q3, it assumed very similar utilization rates to the first quarter. And then you get into the fourth quarter and you're looking at utilization that would be up over 20%, which would imply a full year 10% utilization growth, which we think is fairly healthy, keeping in mind how many new accounts that we're adding to the business in 2025, which we've consistently said it's a natural headwind to utilization and it takes about two to three quarters, excuse me, for our accounts to get up to the corporate average. But we're really pleased directionally with where utilization is trending.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

I would just add Matt, I'm sorry, Craig, it's Sham that, you know, we continue to have, you know, great insight into daily procedures, number of new surgeons, surgeon retention rates and exiting March into April, we were on track to where we want to be as far as launching new accounts and hitting the surgeon retention rates and adding new surgeons at the rate we need to be to hit our forecast. Sailing is behind us. I think March is the first month where we felt confident that the dynamic that's now gone, and we're now back in full swing as far as daily procedure rates.

[Craig Bijou, Equity Research Analyst at Bank of America Securities]

Great. That's helpful. And, I know you guys have talked a lot on this call about the multi system orders for the IDNs, and you you have been talking about it for a number of years now and it seems like maybe there was an acceleration. And I know you guys, I heard you guys mention hydros as one of the drivers, but I mean anything else that's changed there? Like it's great to see And I'm just curious as to what those discussions look like now versus where you guys were a year ago.

[Craig Bijou, Equity Research Analyst at Bank of America Securities]

And how should we think about that impact in years going forward?

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

Yeah, Shyam, I'll start by just really mentioning the current environment has adjusted or changed to your question, simply because hospital systems now can look back at existing programs they've had for years, and versus it being kind of a vision of establishing an occupation program, they can go back and look at the data and say, is this working? And so the fact that they can now look at their own hospitals, they can see what the reimbursement looks like, they can see how patient, volumes are growing at the hospital, they can see that they're adding new surgeons because of this technology, all of those reasons are the reasons why they want to now have more strategic or corporate conversations. I will tell you that, you know, we've been having IDN purchases all along. This is now just becoming more of a partnership versus just taking one hospital at a time through the IDN. So the ability now to have those conversations will serve us, you know, really well over the coming years.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

That's the partnership I think we have with IDNs. You know, whether it's a bulk buy or one purchase at a time, this is more about the corporate level supporting their local hospitals, and that's kind of the evolution of the conversation that's happened.

[Craig Bijou, Equity Research Analyst at Bank of America Securities]

Great. Thanks, guys.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

Thanks, Craig.

[Operator]

Thank you. One moment for our next question. Our next question will come from the line of Patrick Wood from Morgan Stanley. Your line is open.

[Patrick Wood, Managing Director at Morgan Stanley]

Beautiful. Thanks, guys. I'd love to start actually this time on OUS. Obviously, NICE supported technology being the most stingy organization of all time, it always gets a lot of attention that way. And so great result there.

[Patrick Wood, Managing Director at Morgan Stanley]

I'm really curious how you're thinking about resourcing OUS growing there because obviously it's a massive opportunity and it's still incredibly early stage. So I'm just trying to work out, there's a lot to go in The US as well, but how do you balance those? How should we think about the OUS ramp over the next, three, five years, whatever?

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

Hey, Patrick. It's Sam. Thanks for the question. You know, we are very excited about the international opportunity, globally. The one thing that we've spoken about in the past, and and I'll just reiterate is is we want to do things the right way.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

And when we go to a market, we wanna make sure we win in a big way. And, and we're early as a company. We've got a lot of opportunity, and we wanna be very disciplined in making sure that when we go to the country that all the boxes are checked. There's a lot of boxes that need to be checked to have winning technology, in many of these markets. So we've made the decision, via a lot of efforts we've made on getting good reimbursement, good support from NICE, as you mentioned, to focus on The UK as the next big market of ours.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

We've now continued to build a team there, and we seen some great growth. We also believe the formula we're using in The US can be reproducible. And so we're following a very similar structure and growth format that we had in The US. We've now taken that to The UK. The next market we'll go to is Japan.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

And outside of those three markets, we continue to do a lot of market development activities. We've got interest from well over 20 countries, significantly more than 20 countries that we decided not to go into right now, because we want to support the markets we're in and win in those markets. But that does serve very well for us in the years to come.

[Patrick Wood, Managing Director at Morgan Stanley]

Beautiful. And then very quickly as a follow-up, The U. S. Side of things, we're obviously moving to a permanent code. We've got there was some noise in the quarter around the physician fee.

[Patrick Wood, Managing Director at Morgan Stanley]

Any sort of updated thoughts on how you're thinking about the pro fee and then the cat change on the code side

[Patrick Wood, Managing Director at Morgan Stanley]

of things for this year?

[Reza Zadno, President & CEO at PROCEPT BioRobotics]

Yes, so the rough process for the category one is complete, so the proposed ruling, we expect to come out this summer. We feel very good about the physician payment, because this procedure is very similar to other receptive procedures, so we anticipate this to be similar to other receptive procedures. What's important is this does not impact APC level six, which is ultimately the ROI to the hospital, that remains at 90 to 100.

[Patrick Wood, Managing Director at Morgan Stanley]

Love it. Thank you so much.

[Operator]

Thank you. One moment for our next question. Our next question comes from the line of Richard Newitter from Truist. Your line is open.

[Richard Newitter, Managing Director at Truist Securities]

Hi, thanks for taking the questions.

[Richard Newitter, Managing Director at Truist Securities]

I just want talk about

[Richard Newitter, Managing Director at Truist Securities]

the content of high volume, low volume, or low to mid volume hospitals. You mentioned, I think, that the proportion going into low to mid was about 50% and going into high volume was about 50%. Can you just remind us kind of what that ratio has looked like over the last one to two years so we can get a sense for whether you're at a point where maybe you're more reliant on medium to low volume accounts to drive higher utilization? And if that's a consideration that we should be thinking about, is it harder to get incremental utilization per account from here on, or just kind of steady she goes is what you've been doing?

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

Yeah. Hey, Rich, it's Sham. You know, I think we think very differently, when you think about utilization and when you think about the size of hospitals. The one thing we've proven up to this point is if a hospital has a low or medium volume BPH volume, when they acquire AquaBlation technology, we've seen significant increases in utilization, in fact, in many cases turning them into high volume BPH hospitals. And so, we're going talk more about this tomorrow, on our Investor Day, but this is something that actually has been very supportive for our hospitals to show they can move surgeons, they can move market share.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

This is what, you know, when you look back historically over the last twenty five years and you see the most successful robotic surgery companies, this is what they've done. The most successful companies have been able to move market share by hospitals establishing robotic programs. This has been a great success of ours and we have over 2,000 hospitals that are low and medium volume VPH hospitals that we're just getting started in. As far as your question on the shift, you know, we've used to be about 70% of our hospitals were high volume hospitals And now we are starting to see a shift down in that because of the addition of low and medium volume hospitals. So very exciting times for us and we continue to validate that this technology is adopted by all.

[Richard Newitter, Managing Director at Truist Securities]

Great. And maybe just for Kevin on the tariff, a follow-up here. Is the message that you could potentially see up to 150 basis point gross margin headwind, obviously, if everything stays the way it is right now, but you offset that in the P and L further down the P and L such that the message is you absorb tariff headwind should it approach 150 basis points? Or there is a potential 150 basis points risk to your reiterated EBITDA guide?

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

Yes, I'll go through that, Rich, in detail here. So the impact we discussed today, it does assume that the tariff rate for imports from China stay at the 145 level and this expense of $5,000,000 max exposure would be weighted towards the second half of the year. Obviously, is a very dynamic situation. I mean, heard recent commentary yesterday that would be positive around this rate. But specific to your question, the $5,000,000 impact would be 150 basis point reduction to our 64.5% margin guidance if nothing else changed here moving forward.

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

With that said, to the second part of your question, even with this headwind, we are affirming our EBITDA guidance if margins trend even towards the low end. But the reason being is we have identified offsets in our operating expenses to mitigate a $5,000,000 impact. So margins would be reduced, but the overall profitability of the company would be unchanged. At the end of the day, 5,000,000 impact is approximately 2% of our operating expenses. And we think as a management team, we could go find that to support continued EBITDA.

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

And then lastly, I think, and it's important, we don't believe the current tariff environment would materially impact our pathway to profitability the future here. We're working on a lot of things as we head into 2026.

[Richard Newitter, Managing Director at Truist Securities]

Okay, thank you.

[Operator]

Thank you. One moment for our next question. Our next question will come from the line of Brandon Vasquez from William Blair. Your line is open.

[Brandon Vazquez, Research Analyst at William Blair & Company, L.L.C]

Hi everyone. Thanks for taking the question. I wanted to go back to the IDNs first and maybe ask the question a slightly different way. I'm kinda curious, what does, the utilization in these accounts look like? And in part, I'm asking because it sounds like this is an effort that you historically used to go in, find one KOL, put put yourself in the account and expand from there.

[Brandon Vazquez, Research Analyst at William Blair & Company, L.L.C]

But now you're having from the top, the corporate, organization push this. Is there a difference in the rate of utilization? Is there a difference in the in the peak utilization or or the just raw, number of procedures that are coming out of these accounts? Curious on any dynamics you can talk about there.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

Yep. Hey, Brandon. It's Sham. So I think that this is something that over time we'll be able to to hopefully give a lot more detail on. But I'll tell you that initially it's still driven the same way, and I'll tell you why we think that there could be, favorability to it in the future.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

Right now it's driven by surgeons. Surgeons drive this technology, they get excited about it, and they come in from the physician office level finding patients and bringing them to the hospital. And patients find those surgeons that are doing aquablation. However, we do have IDNs that have patient navigation programs. These are employees of the hospital network that work to educate the referring physicians on new technologies the hospitals offer, and that helps to drive this funnel of patients to drive more patients for aquablation.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

We have IDNs currently that are very interested in Procept educating those nurse navigators, educating that pathway, and those are opportunities that exist from the corporate level. Exactly. That's an example of something I think can help utilization will. There are other areas that we're talking to strategically also. But at the end the day, you know, these decisions are surgeon decisions, but anything that IDNs can do to educate and raise awareness is also always helpful for utilization.

[Brandon Vazquez, Research Analyst at William Blair & Company, L.L.C]

Okay. And as a maybe as a follow-up to that, I'll throw two here because one's a follow-up to that question is basically maybe the more blunt way to ask the question I was trying to ask is it looks like the goal of robotics often sharing from your experience and intuitive and then now what you wanna do in Procept is standardize. Right? You wanna standardize to a certain, care pathway. Do the IDNs, the increasing adoption of IDNs, to ask you more bluntly, may give you a clearer pathway to standardizing on Procept?

[Brandon Vazquez, Research Analyst at William Blair & Company, L.L.C]

And then separate unrelated question. Now that you guys have a second randomized controlled trial with WATER three, can you just spend a couple of minutes on what's the game plan here in terms of using this potentially for societies, change guidelines, and then, maybe open some new international markets? Thanks, guys.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

Sure. Yeah. Hey, Brandon. I'll I'll take the utilization question, and I'll pass it over to Reza. So, you know, I I think that, you know, what we're seeing on the IDN level is absolutely, you know, an interest in in doing more on the utilization front.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

So, you know, I'll tell you that, you know, tomorrow we'll talk more about it at our Investor Day, but these are all things that I believe ultimately will help the population become the standard of care. They do want to standardize. At the end of the day, these are certain decisions, but anything that the hospitals can do to help with training, to help with education is going to help standardize the procedure. And those are the conversations we're having right now. We're making a big investment in the strategic accounts team to be able to support the hospitals.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

And that is definitely something that's on their mind, is how do they get more op ablation procedures in their hospitals.

[Reza Zadno, President & CEO at PROCEPT BioRobotics]

Related to your second part of the question, what are three data were presented a few weeks ago in Madrid? As early as it is, but the initial response has been very positive. This was a randomized study against enucleation, and multicenter, multicountry net was shown with a zero percent transfusion with similar efficacy results, but better safety outcomes. So this will definitely, will be in the future, into the international guidelines, and this further strengthens our clinical benefit clinical benefits of our population. So definitely, as you said, it will get the goal is to get into the guidelines.

[Operator]

Thank you. One moment for our next question. Our next question will come from the line of Josh Jennings from TD Cowen. Your line is open.

[Joshua Jennings, Managing Director at TD Cowen]

Hi, good morning. Thanks for taking the questions. I was hoping to just ask about PRCT001, two, those results coming out. I think you'll have twelve month results on two and maybe one as well. But help us understand the plan just in terms of filing and what are four is going to generate level one evidence.

[Joshua Jennings, Managing Director at TD Cowen]

But in front of level one evidence will Procept move forward with filing for a general use tools claim for localized prostate cancer?

[Reza Zadno, President & CEO at PROCEPT BioRobotics]

Yeah, thanks Josh. This is Reza. So we are very excited about the event tomorrow. I think more importantly is hopefully tomorrow, we will answer recently questions about, do we spread cancer? Can we treat the lesion in different locations of the prostate?

[Reza Zadno, President & CEO at PROCEPT BioRobotics]

Can we treat in the peripheral zone, or the transitional zone? And why is this randomized against prostatectomy? So tomorrow, data, 70 patients, PRCT001, two with three months, and six months data, and 50 patients will be presented. Yes, we can potentially obtain a tool claim, but we know ultimately, in order to, our goal is to expand the market of prostate cancer. And that's why we have started WATER-four randomized study against prostatectomy, so that we can generate level one data in order to get to guidelines.

[Operator]

Thank you. One moment for our next question. Our next question will come from the line of Chris Pasquale from Nephron Research. Your line is open.

[Chris Pasquale, Partner - Medical Devices & Supplies at Nephron Research LLC]

Thanks. Wanted to follow-up on tomorrow first and a follow-up on reimbursement. You talked previously about some potential investment options you're evaluating to try and speed up the timeline for Water four, not to get ahead of ourselves and what we're gonna see tomorrow, but what are your latest thoughts on the enrollment timeline for that study?

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

We'll provide a lot more detail tomorrow, but we've been consistent in stating that, you know, kind of unencumbered, this would be approximately a twenty four month enrollment. Think we think a good result is to try and shorten that by six months, and that's the additional investments we're talking about, but we're gonna give an update tomorrow kind of on timeline, but you should think of this as an eighteen to twenty four month enrollment.

[Chris Pasquale, Partner - Medical Devices & Supplies at Nephron Research LLC]

Okay, that's helpful. And then could you just talk about the practical implications of the LCD changes and what you think that does to your market opportunity within geographies represented by First Coast and Novitas?

[Reza Zadno, President & CEO at PROCEPT BioRobotics]

So

[Reza Zadno, President & CEO at PROCEPT BioRobotics]

the, as I mentioned in the prepared remarks, you know, removing some of those obstacles definitely streamlines the patient pre workup, you know, the age removal, the minimum void impacting patients with retention, and the measurement of their prostate site, these are all the obstacles that are removed. And definitely age is now removed on all MACs, but the other two, we believe this could be a precedent for the other MACs to remove the way they have to measure the prostate, using transrectal ultrasound. All of this will facilitate using the technology on patients.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

Chris, I'd just add that I'm not sure everybody understands that not every urologist owns a transrectal ultrasound in their office setting. And so their ability to use transrectal ultrasound is not in question, but their ability to have access to it can be a challenge. So that's a big one. And then Reza touched on the other one. This is, you know, the more these are all smaller wins in the sense of like one at a time, but when you add all these small wins together becomes a big win because then these surgeons don't think of this as a workup nightmare, so to speak, it becomes way easier to schedule patients.

[Chris Pasquale, Partner - Medical Devices & Supplies at Nephron Research LLC]

That's helpful, thanks.

[Operator]

Thank you. One moment for our next question. The next question will come from the line of Mike Crackley from Leerink Partners. Your line is open.

[Mike Kratky, Senior Managing Director - Medical Devices & Technology at Leerink Partners]

Hi, everyone. Thanks for taking our questions. Have you seen any shift in the typical prostate size where ocular ablation is being used as physicians get more and more familiar with the system or as they've incorporated it into their practice broadly, whereas Pygros has started to roll out? And then maybe just a follow-up, can you share any feedback that you hear from your customers on surgeons perceived value proposition

[Mike Kratky, Senior Managing Director - Medical Devices & Technology at Leerink Partners]

of aquablation across different prostate sizes in BPH?

[Reza Zadno, President & CEO at PROCEPT BioRobotics]

Yes, so the distribution curve that we have been showing in the last couple of years remains similar. So it's, and the majority of their prostate that are treated are below 100 milliliters. So that distribution curve has not changed. Shyam, do you want to talk about the value proposition?

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

Yeah, think one of the, you know, big benefits of aquablation is, you know, you don't always know what size the prostate is going to be when go into surgery. I think that surgeons are consistently doing their best to gauge what they're dealing with, but you get in the operating room and many times they're surprised by what they're dealing with. And the aqua ablation therapy technology allows you to treat prostates of all sizes consistently, efficiently, and with consistent outcomes that we just saw with a randomized study with WATER-three. And so I think what you're going to see now is many surgeons who felt like they needed to refer out large prostates, many surgeons who felt like they maybe needed to go get trained on a technique for large prostate surgeons that were doing prostatectomies, etc. Those are patients that I believe they now have the data, they now have the support to show consistent results with with aquablation therapy.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

We've had this data, for a long time, there's over 150 peer reviewed journals, but this WATER-three study continues to validate that the randomized data we're investing in is, is very consistent across the board. So I think we'll see this continue to be a big benefit for us long term.

[Mike Kratky, Senior Managing Director - Medical Devices & Technology at Leerink Partners]

Super helpful. Thanks very much.

[Operator]

Thank you. One moment for our next question. Next question will come from the line of Nathan Trebek from Wells Fargo. Your line is open.

[Nathan Treybeck, Equity Research Vice President at Wells Fargo]

Hi, thanks for taking the question. Hey, Kevin, I just wanted to clarify something you said earlier on the ASP. I mean, I think going into the year, you expected about $3,000,000 from system replacements. Can you just clarify like the ASP differential between replacements and greenfield? Thanks.

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

Yeah. So it's an interesting dynamic and it's going to vary based on the age of the system. So for example, we did have one replacement in the first quarter, but given the age of that AquaBeam system, the pricing wasn't terribly different than to a new greenfield account in the quarter, which is why we didn't separately call it out. And that dynamic, I think, is fair if your AquaBeam is, I'll call it three plus years old, and then we obviously are offering some type of trade in discount, but we haven't been specific on what that is. This is going to vary from customer to customer.

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

It's also why we incorporated a full year system revenue number into guidance to kind of help everyone back into what a replacement could look like.

[Nathan Treybeck, Equity Research Vice President at Wells Fargo]

Okay, that's helpful. And then on the prior just deferred procedures, exiting, I think in Q4, you had 2,000 procedures that were deferred. You talked about some lingering impact in January and February. I guess where does the deferral stand today and over what timeframe can you recapture these procedures?

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

It's really difficult to say with absolute certainty. At the end of the day, the 2,000 that 2,000 procedure maximum that we felt were deferred in the fourth quarter, they're a small part of the 52,500 procedures we're going to do here in 2025. But we would expect these to kind of be coming back throughout the year. I mean, BPH is an elective procedure, and therefore backlog procedures are probably just likely to filter in evenly throughout the year.

[Nathan Treybeck, Equity Research Vice President at Wells Fargo]

Thanks.

[Operator]

Thank you. One moment for our next question. Our next question will come from the line of Michael Sarkone from Jefferies. Your line is open.

[Michael Sarcone, Analyst at Jefferies]

Good morning all and thanks for taking the questions.

[Michael Sarcone, Analyst at Jefferies]

Just a

[Michael Sarcone, Analyst at Jefferies]

follow-up on the capital equipment environment. Can you maybe give us an update on where you stand in terms of duration of a typical sales cycle these days? It doesn't sound like you're seeing any changes, but would love an update there. And then maybe comment on what kind of visibility you have into the funnel?

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

Hey, Michael, it's Shyam. So to answer your question, changes as far as the sales cycle. Six to nine months continues to be a typical sales cycle. You will see some things move faster, you'll see some things go a little bit longer depending on budgetary kind of constraints. But six to nine months is a fair kind of thought as far as when you think about our pipeline and how quickly we can move through.

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

I apologize, what was

[Sham Shiblaq, Executive VP & Chief Commercial Officer at PROCEPT BioRobotics]

the second part of your question?

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

I could take it. Just kind of visibility into the funnel. And I mean, specifically, we haven't seen any change in conversion rates. We haven't seen any change in fallout.

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

And it's been very consistent over the last twelve to twenty four months.

[Michael Sarcone, Analyst at Jefferies]

Got it. Thank you. And then just for the follow-up, maybe just give us an update on the competitive environment in BPH and what you're seeing, where are you taking share? Maybe any commentary on what your the latest and greatest on the prostate artery embolization front.

[Reza Zadno, President & CEO at PROCEPT BioRobotics]

Yes, so I addressed the PAE first, you know, PAE has been around for more than twenty five years, and it's probably done by radiologists. Efficacy is similar to non resective, but the issue over there mostly on durability, and the data show that they have about twenty percent retreatment at one year. So these are obvious barriers, so we don't see that as a competition. As far as where we take market share, when we ask the question, the answer we typically get is definitely, we have said in the past, is TURP, GreenLight, and for larger prostates, definitely enucleation. New technologies that are coming on board, what we see mostly they are various forms of nonresective procedures, so this is what we are seeing.

[Reza Zadno, President & CEO at PROCEPT BioRobotics]

On the resective side, we are not aware of anybody coming up with a technology or running a clinical study on the receptive side.

[Michael Sarcone, Analyst at Jefferies]

Great, thank you.

[Operator]

One

[Operator]

moment for our next question. Our next question will come from the line of Ryan Zimmerman from BTIG. Your line is open.

[Ryan Zimmerman, Managing Director & Medical Technology Analyst at BTIG]

Good morning. Thanks for taking the questions. Just a clarification on capital sales, Kevin. I think last quarter, and correct me if I'm wrong, the two ten unit guide was separate, the $95,000,000 specifically was separate from the $3,000,000 replacements. And is the $3,000,000 now included in the $95,000,000 I just want to be clear because at $210,000,000 at $435,000,000 apiece, I mean, you're coming in at like $91,000,000 and change.

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

Yeah. So it's correct. And so the 3,000,000 would be incremental to the 210 to get you to the the $95,000,000 system guide.

[Ryan Zimmerman, Managing Director & Medical Technology Analyst at BTIG]

But but was that the case last quarter, Kevin? Because I don't as I interpreted it, it wasn't. I may be mistaken.

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

Yeah, sorry. It was same last quarter, but we did not guide a total revenue number. And we just we wanted to clarify that on this call, but nothing has changed in terms of our expectations.

[Ryan Zimmerman, Managing Director & Medical Technology Analyst at BTIG]

Okay. And then just to be clear, I think this was asked, but again, I apologize. I'm just trying to get some clarification questions. The 2,000 procedures that were deferred, you're not assuming or you are assuming that those were fully recouped in the first quarter?

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

No, we are not assuming that. What we're saying is we would suggest that any deferrals from Q4 into Q1 were largely offset by the sailing impact that we saw in January and February. So we would consider that impact negligible in the first quarter. And if they were to come back, we feel that they're going to come back throughout the year, not in any one given quarter.

[Ryan Zimmerman, Managing Director & Medical Technology Analyst at BTIG]

Okay. Very clear. Thank you for the clarification.

[Kevin Waters, Executive VP & CFO at PROCEPT BioRobotics]

Thanks, Ryan.

[Operator]

Thank you. I'm not showing any further questions at this time. I would now like to turn the call back over to Reza Sadno, CEO, for any closing remarks.

[Reza Zadno, President & CEO at PROCEPT BioRobotics]

Yeah. Thanks for attending this meeting. Hope to see you tomorrow at our event and see you in the future conferences. Thank you very much. Have a nice day.

[Operator]

Thank you for your participation in today's conference. This does conclude the program. You may now disconnect. Everyone, have a great day.

Participants

Executives

• Matt Bacso, VP - Investor Relations and Business Operations
• Reza Zadno, President & CEO
• Sham Shiblaq, Executive VP & Chief Commercial Officer
• Kevin Waters, Executive VP & CFO

Analysts

• Matt O'Brien, Analyst at Piper Sandler Companies
• Craig Bijou, Equity Research Analyst at Bank of America Securities
• Patrick Wood, Managing Director at Morgan Stanley
• Richard Newitter, Managing Director at Truist Securities
• Brandon Vazquez, Research Analyst at William Blair & Company, L.L.C
• Joshua Jennings, Managing Director at TD Cowen
• Chris Pasquale, Partner - Medical Devices & Supplies at Nephron Research LLC
• Mike Kratky, Senior Managing Director - Medical Devices & Technology at Leerink Partners
• Nathan Treybeck, Equity Research Vice President at Wells Fargo
• Michael Sarcone, Analyst at Jefferies
• Ryan Zimmerman, Managing Director & Medical Technology Analyst at BTIG