Establishment Labs Q2 Earnings Call Highlights

Key Points

• Strong growth and raised outlook: Second-quarter revenue rose 31.7% year over year to $67.5 million, while adjusted EBITDA improved to positive $3.7 million from a loss of $8.5 million. Establishment Labs raised its full-year revenue forecast to $269 million–$271 million.
• U.S. and Minimally Invasive platforms drive momentum: U.S. revenue surged 140.9% to $24.7 million, with more than 100,000 Motiva implants sold and over 2,000 accounts. Mia and Preservé generated $12.1 million in quarterly revenue, while Preservé exceeded surgeon-training expectations and commands a significant pricing premium.
• Improving financial position and future pipeline: Gross margin increased to 70.6%, cash reached $71.2 million, and management said no future equity raises are needed to execute its strategy. The company expects to become free-cash-flow positive in the second half of 2026, while reconstruction revenue is expected from 2027 and GEM could contribute in the U.S. from 2028 or later.

Establishment Labs NASDAQ: ESTA reported second-quarter revenue growth of 31.7% year over year, driven by continued rapid expansion in the United States, rising adoption of its Minimally Invasive platform and improving operating leverage.

Revenue for the quarter totaled $67.5 million, while adjusted EBITDA was positive $3.7 million, compared with an adjusted EBITDA loss of $8.5 million in the prior-year period. The company raised its full-year revenue outlook to a range of $269 million to $271 million, from prior guidance of $266.5 million to $268.5 million.

CEO Peter Caldini said the company had started the third quarter well despite the period traditionally being the seasonal low point for breast augmentation procedures. Establishment Labs expects to transition to free-cash-flow positive in the second half of 2026 and to remain free-cash-flow positive for fiscal 2027.

U.S. Business Drives Growth

U.S. revenue increased 140.9% from a year earlier to $24.7 million, representing 36.6% of total company revenue, compared with 20% a year earlier. U.S. revenue also rose 26% sequentially from the first quarter, according to Caldini.

The company said it surpassed 100,000 Motiva implants in the U.S. market less than 21 months after launch. It also ended the quarter with more than 2,000 U.S. accounts, with many accounts using Motiva across multiple surgeons.

Caldini said growth is increasingly coming from greater use within existing accounts as surgeons become more familiar with the product’s clinical data, patient outcomes and differentiators. He added that management is seeing growing patient awareness of the Motiva brand, citing company feedback that 75% of surgeons report patients asking for an implant brand and, in 93% of those instances, the requested brand is Motiva.

Outside the U.S., revenue was $42.8 million, up 4.4% year over year. Europe grew 16%, led by Italy, Germany and the U.K., while Argentina continued its positive trajectory and Brazil remained stable, management said. Caldini said demand in most distributor markets remained steady, though Middle East orders were below historical levels amid regional conflict. CFO Sandra Harris said the Middle East accounts for less than 5% of company revenue.

Minimally Invasive Platform Gains Traction

Establishment Labs generated $12.1 million in quarterly revenue from its Minimally Invasive platform, which includes the Mia and Preservé procedures. Management said the platform is approaching 15% of full-year global revenue and is performing above its original expectations.

Mia is currently offered outside the U.S. and is intended for women seeking a more subtle enhancement. Preservé, which is being rolled out in the U.S., is designed to accommodate a broader range of patient needs, including larger augmentations and augmentation mastopexy procedures, while retaining the company’s tissue-preserving approach.

Caldini said Preservé had more than 300 trained and certified surgeons at the end of the quarter, exceeding the company’s original full-year expectation by more than 50%. Establishment Labs now expects to train about 500 surgeons during 2026.

Management said surgeons are generally charging 30% to 50% more for Preservé than for traditional breast augmentations. Caldini also said Preservé commands a premium of more than two times that of a traditional breast augmentation procedure for Establishment Labs in the U.S.

The company said its research indicates that 15% of women undergoing Preservé had not initially been considering breast augmentation. Caldini said Minimally Invasive procedures can address barriers including anesthesia, scarring and recovery time, potentially attracting patients who may not otherwise have pursued augmentation.

Margins, Cash and Outlook

Gross profit was $47.7 million, or 70.6% of revenue, compared with a 68.8% gross margin in the prior-year quarter. Harris attributed the margin improvement to a greater contribution from higher-margin U.S. and direct international markets, favorable product mix and growth in the Minimally Invasive platform.

Operating expenses were reported at $52 million for the quarter, including one-time costs, while management said expenses increased modestly relative to nearly 32% revenue growth. Harris said the company has been able to leverage operating spending and does not anticipate major increases beyond its prior investment levels as it advances its innovation pipeline.

Cash and cash equivalents totaled $71.2 million at quarter-end, up $3.1 million from the first quarter and $16.5 million from a year earlier. Harris said the company generated positive overall cash flow and has sufficient liquidity to execute its strategy without future equity raises.

For the third quarter, management cautioned that the business is subject to normal seasonal softness during summer vacation periods. The fourth quarter is expected to be the company’s strongest quarter of the year.

Pipeline Updates

Establishment Labs continues to advance its U.S. reconstruction submission with the Food and Drug Administration, expand its U.S. implant size matrix and develop GEM, a potential gluteal augmentation procedure. Caldini said the FDA has begun BIMO audits of clinical study sites for the reconstruction submission, while the company is responding to what it considers routine agency questions.

Management does not expect material reconstruction revenue until 2027. The company said it expects revenue growth of around 25% in 2027, though it did not provide more detailed guidance for that year.

For GEM, Caldini said Establishment Labs is conducting a clinical study in Costa Rica and expects an early experience in Latin America during the second half of 2027. The company is still evaluating regulatory pathways in the U.S. and Europe and does not expect GEM to contribute materially in the U.S. until 2028 or later.

About Establishment Labs (NASDAQ:ESTA)

Establishment Labs Holdings Inc is a global medical technology company specializing in the design, development and manufacture of silicone gel breast implants for aesthetic and reconstructive surgery. The company's proprietary portfolio is built around patient-focused safety, customization and innovation, offering solutions intended to enhance surgical outcomes and support clinical traceability.

The company's flagship products fall under the Motiva® brand, which includes a range of ergonomic and round breast implants featuring SilkSurface® texturing and an embedded Q Inside® Safety microtransponder for unique implant identification.

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