AtriCure Q1 Earnings Call Highlights

Key Points

• $141.2 million in Q1 revenue (+14.3% YoY) with adjusted EBITDA nearly doubling to $17.1 million and net income turning positive (~$100,000); company reiterated full‑year revenue guidance of $600–$610 million.
• Growth was product‑driven: pain management rose ~28% led by broad adoption of the cryoSPHERE MAX (≈70% account penetration), while AtriClip FLEX‑Mini/PRO‑Mini and the EnCompass Clamp lifted appendage management and open ablation even as MIS ablation declined.
• The BoxX‑NoAF randomized trial is enrolling ahead of plan with ~300 of 960 patients enrolled and full enrollment expected around end‑2026, positioning the company for a potential surgical‑congress data presentation (e.g., AATS).

AtriCure NASDAQ: ATRC reported first-quarter 2026 results that management described as an accelerated growth start to the year, highlighted by double-digit revenue gains and improved profitability alongside faster-than-expected enrollment in a key clinical trial.

Revenue rose 14% as U.S. adoption of newer products accelerated

President and CEO Michael Carrel said AtriCure delivered “worldwide revenue of $140 million in the first quarter,” reflecting 14% year-over-year growth, driven largely by U.S. momentum from newer products including AtriClip FLEX-Mini and PRO-Mini devices, the cryoSPHERE MAX Probe, and continued strength from the EnCompass Clamp.

Chief Financial Officer Angela Wirick provided the detailed results, reporting worldwide revenue of $141.2 million, up 14.3% on a reported basis and 12.8% on a constant-currency basis versus the prior-year quarter. Revenue increased about 1% sequentially from the fourth quarter of 2025.

U.S. revenue increased to $116.2 million, up 14.9% year over year. By franchise in the U.S.:

• Open ablation sales rose 17.3% to $39.1 million, fueled by EnCompass Clamp adoption in new and existing accounts.
• Appendage management sales increased 14.9% to $48.4 million, primarily driven by adoption of AtriClip FLEX-Mini and PRO-Mini.
• MIS ablation sales fell about 25% to $6.4 million.
• Pain management sales climbed 29.5% to $22.4 million, led by cryoSPHERE MAX, which contributed about 70% of pain management sales.

Pain management led growth as cryoSPHERE MAX adoption expanded

Carrel said pain management led AtriCure’s portfolio growth, increasing 28% year over year, with the cryoSPHERE MAX Probe as the primary driver. He noted surgeons “recognize the significant time savings and clinical effectiveness it provides,” supporting increased utilization across both new and existing accounts.

During the Q&A, Carrel highlighted growth opportunities in thoracic procedures, emerging traction in sternotomy, and early-stage work in below-the-knee amputation procedures. Wirick added that about 70% of pain management accounts have adopted cryoSPHERE MAX, with cryoSPHERE MAX accounts growing about 10% within the quarter. Carrel attributed recent sternotomy traction to shorter freeze times with the MAX product, saying reduced procedure time has improved willingness to trial the technology and helped drive “sticky” adoption once surgeons see outcomes.

BoxX-NoAF enrollment running ahead of schedule; timing for potential data readout discussed

AtriCure also emphasized progress in its BoxX-NoAF clinical trial. Carrel said the company has enrolled approximately 300 patients to date in the 960-patient randomized controlled trial after initiating enrollment in the fourth quarter of last year. He said AtriCure is “tracking well ahead” of its original timeline and now expects to complete enrollment around the end of 2026, nearly one year ahead of plan.

In response to an analyst question about rapid enrollment potentially reflecting favorable outcomes, Carrel said the study is blinded and the company does not have patient-level trial information. However, he said the company has seen “significant reductions” in preliminary work leading into the trial and noted that “5-plus sites” have chosen to adopt the approach and not participate in the trial because they were seeing strong results using the EnCompass Clamp plus AtriClip.

On potential timing for disclosure, Carrel said full enrollment could occur in late December or early January, with about 30 days of follow-up for the last patient and additional time required for adjudication. He suggested a data presentation is “more likely a surgical congress,” pointing to AATS next year as a potential venue, while noting STS in January/February would be “highly unlikely” based on timing.

Margins improved; adjusted EBITDA nearly doubled and net income turned positive

Wirick said gross margin was 77.4% in the first quarter, up 246 basis points year over year, driven by favorable product and geographic mix, particularly from strong U.S. performance and new product adoption.

Total operating expenses increased $10.2 million to $108.8 million, reflecting a rise in R&D spending tied to rapid BoxX-NoAF enrollment (partially offset by lower LEAPS clinical trial costs) and increased headcount for product development. SG&A expense also increased as the company continued to support growth while seeking leverage.

Adjusted EBITDA was $17.1 million, up from $8.8 million in the prior-year quarter, a 95% increase. The company recorded net income of about $100,000, compared to a net loss of $6.7 million a year earlier. Earnings per share and adjusted EPS were both $0.00, compared with a loss per share of $0.14 in the first quarter of 2025.

AtriCure ended the quarter with approximately $146 million in cash and investments. Wirick said the company expects positive cash flow through the remainder of the year, resulting in full-year cash generation “moderately higher than 2025.”

Guidance reiterated; MIS ablation and certain international markets remain headwinds

AtriCure reiterated full-year 2026 revenue guidance of $600 million to $610 million, representing expected growth of about 12% to 14% over 2025. Wirick said the company expects the remainder of the year to be driven by pain management, appendage management, and open ablation, partially offset by continued headwinds in MIS ablation and certain international markets. For the second quarter, the company anticipates typical seasonality and mid-single-digit sequential growth.

On profitability, AtriCure reiterated expectations for full-year adjusted EBITDA of $80 million to $82 million and full-year net income, translating to EPS of approximately $0.00 to $0.04 and adjusted EPS of approximately $0.09 to $0.15. Wirick said the accelerated enrollment in BoxX-NoAF pulls costs into 2026 and is incremental to the plan, and that gross margin favorability in the first quarter was driven by an “extremely favorable mix” that may not persist at the same level. The company also expects expanded manufacturing facilities to come online in the second half of 2026, increasing manufacturing cost burden and moderating gross margin.

International revenue was $25.0 million, up 11.5% reported and 3.3% in constant currency. Wirick cited ongoing uncertainty in the U.K. and lower distributor sales in Asia as headwinds, while pointing to strength in direct markets in Europe, Australia, and Canada. She said guidance does not assume a recovery in the U.K., while distributor ordering patterns in Asia are expected to be transient. Later in the call, she said the company expects reported international growth “closer in line” with the overall company’s guide for the full year, supported by direct-market strength, new product launches, EnCompass growth in Europe, and a rebound in Asia distributor ordering.

On competition and product mix in appendage management, Carrel said Medtronic is currently the only entrant the company competes with directly in the U.S., and that AtriCure has seen share gains as FLEX-Mini adoption expands. Wirick said FLEX-Mini represented about 40% of U.S. open appendage management revenue exiting the quarter. She also outlined a pricing range in the U.S. for AtriClip products, from about $1,100 for the original AtriClip device up to about $2,250 for FLEX-Mini.

In closing remarks, Carrel said AtriCure is “off to a good start” in 2026 and remains focused on execution, advancing standards of care, and delivering durable growth with improving profitability.

About AtriCure NASDAQ: ATRC

AtriCure, Inc is a medical device company focused on the development, manufacture and marketing of innovative therapies to treat atrial fibrillation (AF) and related conditions. Founded in 2000 and headquartered in Mason, Ohio, AtriCure has established itself as a leader in surgical ablation devices designed to interrupt the errant electrical pathways that cause AF. The company's solutions are used by cardiac surgeons and electrophysiologists to reduce the risk of stroke and improve patient outcomes in the treatment of both paroxysmal and persistent AF.

The company's product portfolio centers on its Synergy Surgical Ablation System, which delivers controlled radiofrequency energy in a minimally invasive format, and the cryoICE Cryoablation System, which offers an alternative ablation modality using precise freezing techniques.

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