ALLURION TECHNOLOGIES, INC. Q2 FY2024 earnings call

Key Points - Second quarter revenue was $11.8M, up 25% sequentially. - Procedure volume grew 12% Y/Y and 4% Q/Q, with over 10,000 balloon placements in Q2. - Achieved operational efficiency improvements; operating expenses and loss from operations reduced in Q2. - AUDACITY trial for FDA approval is on track to complete by end of 2024. - Raised $22M in gross proceeds in July. - French regulatory suspension due to advertising, follow-up, and education concerns, but cooperating on remediation. - Adjusted full-year procedure volume growth to 10%-15% and revenue to $40M-$45M. - Digital platform advancements, including VCS onboarding in US. - Scientific studies show positive weight loss and muscle mass maintenance with Allurion program. - Welcomed new COO Ojas A. Buch.

Second quarter revenue was $11.8 million, a sequential increase of $2.3 million (25%) from the first quarter of 2024. Procedure volume, as estimated by new app users, grew by 12% compared to the same period in 2023 and 4% sequentially from the first quarter of 2024. France represents approximately 15% of the company's business over the past two quarters.

Guidance - Adjusted full-year procedure volume growth forecast to between 10% and 15%. - Expect full-year revenue to range between $40 million and $45 million. - Working towards achieving profitability by the end of 2025.

Risks - French regulatory suspension of Allurion balloon sales pending remediation. - Macroeconomic headwinds in certain markets (Latin America, Asia Pacific) leading to slower procedure growth and more conservative inventory stocking. - Competition with GLP-1 drugs and adherence issues with those drugs.

Q: What prompted the action by the French regulatory authority?

A: The French regulatory authority focused on advertising, patient follow-up, and physician/patient education programs. It's not based on new scientific evidence about the balloon, and complication rates are in line with literature.

Q: How much of the plan to reach profitability by end of next year is predicated on lowering operating expenses?

A: Expense management and extracting more efficiencies from the business are a big part, along with potential growth in direct markets for the Allurion balloon.

Q: Could you quantify the impact of France inventory, macro, and other headwinds on guidance reduction?

A: France was ~15% of business; macro headwinds in Latin America and Asia Pacific led to reduced procedural volume expectations and more conservative inventory restocking assumptions.