LENSAR NASDAQ: LNSR executives told investors on Thursday that the company is moving past a “transaction-related holding pattern” after the termination of its planned merger, and is now refocusing on rebuilding commercial momentum around its ALLY femtosecond laser cataract platform. Management said first-quarter results reflected that period of uncertainty, but highlighted continued growth in recurring revenue and rising procedure volumes.
Management says company is “carving our own path” post-termination
Chief Executive Officer Nick Curtis said LENSAR spent much of the first quarter in “a state of limbo” tied to the pending transaction, which was terminated in mid-March. Curtis framed the deal’s termination as validating LENSAR’s technology position, saying, “the FTC position and deal termination validated we have the best technology in the market.”
Curtis said that, for the next several quarters, the company’s progress should be viewed through the lens of rebuilding the foundation it had before the merger announcement at the end of the first quarter of 2025. “Success won’t be measured by any metric on our P&L, but rather by progress towards reestablishing the solid foundation and momentum for growth,” he said.
He added that LENSAR is returning to “the fundamentals of growing new placements and the resulting recurring revenue in and outside the U.S.” and expects to expand globally now that distributors and customers have clarity on the company’s direction as an independent organization.
Revenue slips on lower system sales, while recurring revenue grows
LENSAR reported first-quarter 2026 total revenue of $13.4 million, down about 5% from $14.2 million in the year-ago period. Curtis attributed the decline to lower capital system sales, partially offset by higher procedure revenue driven by global procedure growth.
Chief Financial Officer Tom Staab said system revenue was approximately $800,000 versus $2.6 million in the prior-year quarter, reflecting lower placement activity during what Curtis described as acquisition-related “malaise.” Recurring revenue rose to $12.6 million, up 9% from $11.5 million a year earlier, and represented 94% of total revenue for the quarter, according to Curtis.
Staab reported gross margin of about $6.4 million, or 48% of revenue, compared with $7.1 million, or 50%, a year ago. He said margin remained within the 46% to 49% range discussed previously and reflected “inflationary increase and tariffs” that the company “chosen not to pass on to our customers.”
Profit driven by non-cash items and acquisition-related accounting
LENSAR posted net income of $36.3 million, or $1.56 per basic share, compared with a net loss of $27.3 million in the first quarter of 2025. Staab cautioned that the quarter’s net income was “largely driven by non-cash items,” including:
- a $23.9 million gain tied to the change in fair value of warrant liabilities; and
- recognition of a $10 million acquisition deposit in other income associated with the transaction termination.
Staab noted that recognition of the deposit “did not increase our cash balance,” because the funds were already in operating accounts but “were not owned by us until the acquisition termination.”
Adjusted EBITDA was negative $311,000, compared with positive $165,000 a year earlier. Staab said the company expects adjusted EBITDA to return to positive territory as placements rebound, which would allow LENSAR to “again generate cash from operations.” LENSAR ended the quarter with $13.5 million in cash, cash equivalents, and investments, and Staab said the company will manage liquidity carefully while rebuilding.
Installed base grows; procedure volumes rise as U.S. activity drives gains
During the quarter, LENSAR placed seven ALLY systems, bringing the ALLY installed base to approximately 205 systems, with an additional 11 systems in backlog pending installation, Curtis said. Total installed base across ALLY and the older LLS platform reached roughly 440 systems, up 12% compared with March 31, 2025. Curtis said ALLY now represents “nearly half” of the global installed base.
LENSAR reported approximately 54,000 procedures in the first quarter, up from about 52,000 a year ago and 39,000 in 2024, according to Curtis. He said U.S. procedure market share ended the quarter at 23.4%, consistent with the level reported at December 31. Curtis said fewer installations in late 2025 and early 2026 limited near-term share gains, but he expects the company to return to “quarter-to-quarter market share gains” as it converts competitive system users and attracts “femto-naive” surgeons.
On the Q&A, Staab emphasized that procedure growth in the quarter was “solely related to U.S. activity,” while procedure volume outside the U.S. was “effectively flat,” reflecting the prior year’s distributor slowdown after the acquisition announcement.
Curtis also discussed the timing dynamics between placements and recurring revenue, noting that newly installed systems typically take “about 30 to 90 days” to ramp to productive procedure levels due to training and workflow integration. He said LENSAR sees higher utilization on ALLY compared with competitors, citing Market Scope data indicating “27% higher procedure numbers on average” than a competitive system, and about an “11% increase” when upgrading from LLS to ALLY.
Distributors re-engaging; product roadmap discussions restart
Curtis said LENSAR’s initial ALLY launch outside the U.S. was successful but stalled during the transaction period due to uncertainty around integration and distribution plans. He said physician interest “never subsided,” and that with clarity restored, he expects international momentum to rebuild over time.
In response to analyst questions, Curtis said he has met individually with each distributor and that the company has received distributor purchase orders after quarter end. “We should ship some systems this quarter outside U.S., which will be the first time in about a year,” he said, adding that additional purchase orders extend “into the fourth quarter.”
Curtis said LENSAR expects a “steady progress of rebuilding and improvement” over the next couple of quarters, and added, “really looking toward 2027 is gonna be really, really good for us.”
On operating expenses, Staab said SG&A will rise organically from a baseline level as LENSAR rebuilds capabilities that were impacted by the pending transaction, including adding service personnel, customer application specialists, and regional sales representatives “to support the growth that we're going to do,” while doing so “judiciously.”
During the call, Curtis also said the company is restarting work on technology enhancements that were “put on hold during the transaction.” He said LENSAR is evaluating additional applications for ALLY, including potential work in corneal procedures, and “continued enhancement” of the platform’s robotic functionality, including making docking more automated and less surgeon-dependent. On possible phaco integration, Curtis said LENSAR has strong intellectual property but is “open-minded,” adding that developing a phaco system itself “is not gonna happen.”
Separately, Curtis confirmed Staab will be leaving the company after the call. Staab said recurring revenue is “annualizing over $50 million” and told investors he believes LENSAR is positioned to “reclaim the success we experienced in 2024.”
About LENSAR NASDAQ: LNSR
LENSAR, Inc, headquartered in Orlando, Florida, is a medical technology company specializing in advanced laser systems for ophthalmic surgery. Its flagship product, the LENSAR Laser System, combines proprietary three-dimensional imaging with precision-guided femtosecond laser delivery to perform critical steps in cataract procedures, including capsulotomy creation, lens fragmentation and corneal incisions.
Founded in 2005, LENSAR has concentrated its research and development efforts on enhancing surgical accuracy and patient outcomes in cataract treatment.
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