Joseph Hogan
President & Chief Executive Officer at Align Technology
Thanks, Shirley. Good afternoon and thanks for joining us. On our call today, I'll provide some highlights from the second quarter, then briefly discuss the performance of our two operating segments, Systems and Services and Clear Aligners. John will provide more detail on our financial results and discuss our outlook. Following that, I'll come back and summarize a few key points and open the call to questions.
I'm pleased to report our first $1 billion revenue quarter with record volumes reflecting continued momentum from both Clear Aligners and Systems and Services. For Q2, Systems and Services revenues reflect strong growth across all regions and the strategic value of the iTero business with continued adoption of the iTero Element 5D Plus Series of next-generation scanners and imaging systems which launched in February.
Increasingly, doctors are seeing the strategic impact and value of iTero scanners in their practices. In addition to its role in Invisalign case submissions, it is a true workhorse and digital enabler in every type of practice and across every type of orthodontic and restorative workflow.
Q2 sequential Clear Aligner volumes were primarily driven by strength in both adult and teen market segments and across customer channels and regions, especially from the Americas and EMEA regions, reflecting the expanding opportunity for Invisalign treatment among adults globally, as well as the underlying orthodontic market as we continue to build awareness of the Invisalign brand and drive utilization among teens and younger patients.
For Q2 '21, Invisalign Clear Aligner volumes for teens were up 9.5% sequentially and 156% year-over-year to 181,000 teens, representing one-third of total cases shipped, with strong growth from North America and EMEA orthodontists. During the quarter, we hosted several team-focused, peer-to-peer events designed to build clinical competence in teen treatment and highlight the teen digital treatment journey with Invisalign treatment.
The recent APAC Virtual Symposium featured leading providers focusing on clinical excellence with teen treatment, and North America hosted the Invisalign Teen forum; Virtual Edition for Invisalign doctors bringing together clinical speakers, digital industry experts and teen patient panelists to share their insights.
In May, Align focused on the Align Digital Platform at the 2021 AAO annual session, featuring a dynamic virtual line-up of Invisalign doctors describing how they have grown their practices through adoption of digital technology.
Our Q2 results also reflect the positive impact of our investments in consumer marketing, generating billions of impressions and 33% year-over-year increase in leads for Invisalign doctors. During the quarter, we launched the next phase of our Mom/Teen multi-touch campaign, as well as the new "Invis is a Powerful Thing" campaign designed to engage teens and young adults.
We also deepened our partnership with influencers like Charli D'Amelio with the first limited-edition aligner case as part of our new e-Commerce initiative featuring custom cases, cleaning and oral care products, as well as accessories like Invisalign Stickables, all of which are available on Invisalign.com.
These and other consumer initiatives are important in supporting doctors' practices especially through the busy summer teen season and beyond. They also build on our investments in digital technology and innovation that are the foundation of the Align Digital Platform, including integrated digital workflows and virtual tools designed to improve clinical confidence, treatment efficiency, and patient outcomes.
A year ago, we released Invisalign Virtual Appointment and Invisalign Virtual Care tools within our My Invisalign app, in response to the global pandemic to enable Invisalign doctors to provide continuity of care for their patients. Today, Invisalign Virtual Care is available globally in 60 markets and the My Invisalign app has been downloaded 1 million times with Invisalign patients worldwide.
It was recently recognized as the "Best Virtual Care Platform" by the MedTech Breakthrough Awards program and as "Digital Innovation of the Year" by Healthcare Asia Medtech Awards. As part of Invisalign Virtual Care, patients use My Invisalign app to stay engaged with their treatment and convey progress photos to their doctor, fostering two-way communication with their doctor throughout their Invisalign treatment journey.
Now let's turn to the specifics around our second quarter results, starting with the Americas. For the Americas region, Q2 was another strong quarter with Invisalign case volumes up 11% sequentially and 261% year-over-year, reflecting growth across the region especially in the United States and Canada, from both comprehensive and non-comprehensive products, and increased Invisalign utilization from orthodontic and GP channels. DSO utilization continues to be a strong growth driver as well, led by Heartland and Smile Docs.
For our international business, Q2 Invisalign case volume was up sequentially 12.7% on a year-over-year basis. International shipments were up 149%. For EMEA, Q2 volumes were up sequentially 17% and 265% year-over-year with broad-based growth across all markets, led by Iberia, UK, and Italy along with continued growth in our expansion markets.
In Q2, growth from both channels was strong, with orthodontic channel growth reflecting increased Invisalign utilization, and GP channel growth driven by increased Invisalign submitters. For Q2, EMEA growth also reflects adoption of the Invisalign First product, designed to treat a broad range of teeth straightening issues in growing children, from simple to complex, including crowding, spacing, and narrow dental arches.
Aiding in treatment engagement for those younger patients, Invisalign Stickables are innovative accessories designed exclusively for use with the patented SmartTrack material in Invisalign clear systems. Available in an array of designs, colors, shapes, and themes, Invisalign Stickables are a fun way for patients to show their personal style during Invisalign treatment. During the quarter, we also hosted a successful virtual edition of GP Growth Summit attended by over 1,200 doctors from the EMEA region.
For APAC, Q2 volumes were up sequentially 4.8% and 50% on a year year-over-year basis, reflecting growth across the region, led by Japan, China and ANZ, despite new and extended COVID restrictions in several APAC markets. APAC performance reflects strength in GP Channel with increased Invisalign submitters, especially in Japan which continues to deliver strong growth.
During the quarter, we hosted our China Forum, attended by over 1,500 doctors from private clinics, our APAC Virtual Symposium, attended by 1,400 doctors as well as the China Public Hospital Forum in June.
Our consumer marketing is focused on educating consumers about the Invisalign system and driving that demand to Invisalign doctors' offices, ultimately capitalizing on the massive market opportunity to transform 500 million smiles. We have provided many of our key metrics that show increased activity and engagement with the Invisalign brand in our Q2 quarterly presentation slides available on aligntech.com.
In Q2, we launched the next generation of "Invis Is" multi-touch campaign driving reach and awareness with adult, mom and teen consumers yielding more than 200% growth in visitors globally to our Web sites and more than 82% increase in searches for an Invisalign trained doctor.
Leading with the Invis is Not Your Parents Braces campaign, we connected with teens, utilizing digital media such as YouTube, Twitch, and social media. We also continued with our Invisalign ChangeMakers program that celebrated and recognized teens driving change in their communities which was covered by multiple media outlets such as Elite Daily, Refinery29, Yahoo! Unwind, Hollywood Life, SheKnows, J-14, Yahoo Finance, Parents.com, Glamour and NewBeauty and generated more than 600 million impressions.
In the EMEA region, our new marketing campaign to drive engagement, "Invis is a powerful thing," went live in the UK, Germany, and France during the quarter resulting in more than 170% year-over-year increase in unique visitors and 136% year-over-year increase in doctor locater searches. We will continue to roll out the campaign to additional markets in the region during the third quarter.
We continued to expand our consumer advertising in the APAC region in Australia, Japan, and China and saw more than an 800% increase in consumer engagement and a 55% year-over-year increase in leads.
Lastly, we continue to build strong relationships with global search and social media giants like Google, Snapchat, and TikTok in order to further leverage our best-in-class consumer demand programs more effective globally. These partners recognize the power of the Invisalign brand and are helping us amplify and gain efficiencies from our investments.
For our Systems and Services business, Q2 revenues were up 20% sequentially and up 214% year-over-year reflecting strong scanner shipments and services. This represents the fourth consecutive quarter of sequential revenue growth.
The iTero Element 5D Plus Imaging System continues to gain traction across all regions with strong adoption with new customers in the APAC and EMEA regions and with existing customers in the Americas region.
In APAC, the iTero Element 2 intraoral scanner did well during the quarter, helping to transform digital workflows and chairside consults for doctors. During the quarter, we announced a new iTero Workflow 2.0 software and previewed auto-upload functionality in the iTero Element 5D Imaging System.
The iTero Workflow 2.0 software advanced features, including faster scanning, improved visualization, and enhanced patient communication tools, were rolled out regionally in all markets where the iTero Element Plus imaging systems were sold.
The iTero Element 5D imaging system auto-upload feature will eliminate steps and streamline Invisalign case submissions with intraoral color scan images that can be used in place of traditional intraoral photos. The auto-upload functionality is scheduled for release during the third quarter of 2021.
There is great symmetry between Systems and Services business with Clear Aligner business reflected in the positive correlation between the deployment of scanners and the increased utilization of Invisalign Clear Aligners.
In terms of digital scans used for Invisalign case submissions, total digital scans in Q2 increased to 82.2% from 78.5% in Q2 last year. International scans increased to 76.2%, up from 72% in the same quarter last year. For the Americas, 86.6% of cases were submitted digitally compared to 86% a year ago.
Cumulatively, over 40.1 million orthodontic scans and 8.4 million restorative scans have been performed with iTero scanners. I'm also pleased to share that Align received regulatory approval for the iTero 5D Plus series in Japan on July 1, with a formal launch event planned for August.
Turning to exocad. During the quarter, exocad launched the Creator Center, the new exocad one-stop-shop for online and in-person educational events with a database consisting of 35 educational webinars showcasing the highlights and add-on features of exocad's software solutions, DentalCAD Galway 3.0 and exoplan 3.0 Galway. More than 2,500 users and distributors have been trained on the new software releases worldwide.
Exocad also expanded their market coverage with a new global OEM partner, Ivoclar Vivadent, or we call IV, one of the largest manufacturers in the dental industry. This strategic collaboration will give exocad access to thousands of new IV users worldwide and will also provide exocad users with access to production processes with removable prosthetics in the future.
Earlier this month, exocad has released PartialCAD3.0 Galway, its module for removable partial denture frameworks, which has new and advanced features for the design of high quality partial dentures. This new release enhances digital CAD/CAM possibilities for exocad users and dental technicians by providing simpler design solutions for complex cases. PartialCAD3.0 Galway provides both experts and new users with smooth, improved integration with DentalCAD, exocad's leading software for dental laboratories.
Bringing the iTero and exocad businesses together makes us more viable within the GP segment and more relevant in day-to-day comprehensive dentistry for our customers. The combination of Invisalign Clear Aligners and iTero scanners have long provided a seamless workflow for orthodontic treatment.
The integration of exocad's expertise in restorative dentistry and implantology, guided surgery and smile design takes the Align technology portfolio beyond our established footprint in orthodontics to ortho-restorative and restorative treatment, and paves the way for new, cross-disciplinary workflows that span from visualization and treatment planning to lab production to chairside. exocad also broadens Align's platform reach in digital dentistry with over 200 partners and more than 40,000 licenses installed worldwide.
With that, I'll now turn the call over to John.