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| This is further evidence of the positive impact of our expense reduction initiatives |
| Our current forecast suggests that we should be able to turn cash flow positive in 2024 |
| Our new product line, which we acquired earlier this year is already showing promise of higher growth ahead |
| We believe these new strategic relationships will generate a substantial number of patient referrals for our existing and extensive network of Vivos' trained dentists, which should bring significant new growth and revenue opportunities to Vivos |
| These programs have now been delivered and executed in just a handful of offices, generating close to $400,000 in new case starts and a ton of positive momentum and provider enthusiasm |
| Along with these positive developments, I'll talk about some of our progress in reducing staff and trimming costs, where we achieved a 32% year-over-year reduction in operating expenses |
| Fortunately, since the quarter closed, we have seen strong positive trends in appliance sales, as other revenue growth measures have kicked in |
| So the key takeaway here is that we believe our responsible cost-cutting measures over the past year helps set a financial foundation that will support our revenue growth initiatives, as we seek to improve our operating results going forward |
| New product lines are showing great promise and good growth and the new initiatives, such as our boost and kickoff programs are being well received |
| This includes the recent closing of a $4 million private placement, our reverse stock split and the actions we've taken throughout the past year to increase operational efficiencies, reduce expenses, which position Vivos to capitalize on the growth opportunities available to us |
| We believe this highly successful new program will continue to drive new case starts and rekindle provider enthusiasm in Q4 and throughout 2024 |
| Revenue growth was impacted by new entry levels into our VIP program, ranging from $2,500 to $50,000 and adding an $8,000 pediatric program, which was received positive -- positively by our providers |
| They go in to do a Boost program, and they've got probably between 10 and 20 at [Indiscernible] with patients, and our results are just outstanding |
| But now that we figured out a little bit of how to generate that kind of confidence and competency in the offices, we think that, that portends very good things to come so |
| Together, these relationships have expanded our product line and distribution channels and created new revenue opportunities for our company |
| We also believe these initiatives will help to augment and accelerate our VIP enrollment efforts |
| Now that delay is behind us, we do expect to see the Lincare project contributing positively to Q4 and into 2024 |
| We are especially excited about this relationship because Lincare serves close to 2 million patients nationwide, many of whom are unsatisfied with using CPAP machines and are seeking alternative methods of treatment, something we can certainly advise them with |
| We also -- we have also proven our ability to generate medical referrals into Vivos provider practices and are currently expanding and intensifying those efforts |
| The agreements will expand our current product line and are expected to create near-term additional revenue opportunities that should begin to contribute here in the fourth quarter |
| So if the [Indiscernible] are in the chair and the patients are there, we've demonstrated the ability to close it |
| With all the progress that we've made and what we expect to accomplish, as we move forward, we continue to plan for becoming cash flow positive from operations by the end of 2024 |
| However, we did refocus and redirect our limited marketing spend to only those areas with the potential for the highest near-term returns |
| So clearly, there's a very large sort of penetration opportunity there |
| And here in the fourth quarter, we are seeing appliance sales and Myofunctional Therapy starts rebounding |
| I also want to highlight the steps we've been taking to improve our liquidity, as well as our capital structure |
| I am pleased to report that the situation there has now been resolved and the planned expansion into additional markets has resumed in earnest |
| As Kirk mentioned earlier, our goal remains to become cash flow positive from operations by the end of 2024 |
| We're getting conversion rates very, very high in our office -- in the offices when we're sending our professional teams in there to show these doctors how to do it |
| Average enrollments during the period increased from approximately 28,000 during the three months ended September 30, 2022, to 34,000 during the three months ended September 30, 2023, and VIP enrollment Right to Buy revenue was recognized over a longer period of time, 23 months in 2023 versus 18 months in 2022 |
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| Next, as previously mentioned by Brad, the impact of that negative publicity and news reports regarding the AGGA device went deeper and lasted longer than we expected |
| We've worked hard throughout this process to avoid staffing and other reductions that would impact revenue, but we now believe the new Vivos Integrator -- we now believe new Vivos Integrated Providers or VIP enrollments and appliance sales have been negatively impacted because of those measures |
| Unfortunately, those cost-cutting measures came with some near-term trade-offs, as top line revenue declined on both a quarter-over-quarter and year-over-year basis |
| Gross margin for the nine months ended September 30, 2023, was 60% compared to 63% for the same period last year due to lower revenue |
| Finally, the previously announced Lincare project was temporarily delayed due to some software configuration and development delays by a third-party charge in facilitating merchant banking and payment arrangements to Lincare |
| Now despite the AGGA being a materially different device with virtually no research to back it up and no required regulatory FDA clearances, the mere suggestion that an oral appliance for treating sleep apnea potentially cause patient harm truly impacted our sales and enrollment efforts |
| We attribute the decrease in product sales, in part due to a negative CPS news report that came out in March of 2023 regarding an unrelated oral device called the AGGA that was not cleared for use by the FDA and was being used off label |
| Obviously, the aforementioned delay also impacted our forecasted top line revenue for Q3 |
| As our cash resources declined, we were constrained to cut back on certain marketing expenditures as well |
| The quarter-over-quarter decrease was due to lower revenue generated quarter-over-quarter from appliance sales, revenue from VIP enrollments, as well as the impact from staffing and cost reductions |
| First, why did top line revenue decline when the expectation was that Lincare, and other revenue initiatives were supposed to begin to impact revenue started in Q3? Well, I would point to four primary factors here: first, a reduction in staffing and support personnel; second, a reduction in marketing expenditures; third, lingering effects of the AGGA news reports and related government investigations, Brad mentioned earlier; and fourth, the unavoidable delay -- and an unavoidable delay in the Lincare project getting off the ground after a successful pilot |
| We were keenly aware that curtailing those support functions would tend to decrease case starts and appliance sales, which is exactly what we have experienced |
| We've also cut a number of non-essential vendors and consultants, professional fees have come down substantially |
| Although, Vivos care devices are cleared by the FDA, based on our continuing discussions with our dentist customers, we believe that some practitioners paused purchases until they learn more about the issue |
| Net loss was approximately $2.1 million for the third quarter of 2023, a significant year-over-year reduction of $3.3 million or 61% compared to $5.4 million for the third quarter of 2022 |
| Net loss for the nine months ended September 30 of 2023 was $9.3 million, a reduction of $8.4 million or 47% compared to $17.8 million for the same period in 2022 |
| Operating loss was approximately $3.5 million and $5.4 million for the three and nine months ended September 30, 2023, compared to $13 million and $19 million for the comparable periods last year |
| My first question is on G&A expenses, those have really been coming down pretty dramatically over the last six quarters really |
| You may recall that in March of this year, a CBS News report broke about a non-FDA-cleared oral appliance called the AGGA that made unsubstantiated claims regarding its ability to treat obstructive sleep apnea |
| Government regulators and others set up consumer complaint hotlines and moved aggressively to investigate and curtail any further damage or potential harm to the general public |
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