Slide 1: Q1 2024 Financial Results
Q1 2024 Financial Results Align Technology, Inc. April 24, 2024 ©2024 Align Technology Inc. All rights reserved. 1
Slide 2: Q1 2024 Conference Call Details
Q1 2024 Conference Call Details Conference call Speakers: Joe Hogan, President and CEO John Morici, CFO Shirley Stacy, VP, Finance, Investor Relations and Corporate Communications Webcast Archive: Audio webcast archive will be available at http://investor.aligntech.com for one month Contacts Website
Slide 3: Safe Harbor and Forward-Looking Statements
Safe Harbor and Forward-Looking Statements This presentation, including the tables below, contains forward-looking statements, including statements of beliefs and expectations regarding our ability to successfully control our business and operations and pursue our strategic growth drivers, our expec
Slide 4: About Non-GAAP Financial Measures
About Non-GAAP Financial Measures • To supplement our condensed consolidated financial statements, which are prepared and presented in accordance with generally accepted accounting principles in the United States ("GAAP"), we may provide investors with certain non-GAAP financial measures which may i
Slide 5: 17.6M total Invisalign patients treated to date
17.6M total Invisalign® patients treated to date, including 4.9M teens. ©2024,Align ©2024 Align Technology Technology Inc.Inc. All rights All rights reserved. reserved. 5
Slide 6: Making clear aligner treatment available for everyone through doctors
Making clear aligner treatment available for EVERYONE through DOCTORS
Slide 7: 600M potential patients through 2M doctors
600M POTENTIAL PATIENTS through +2M DOCTORS with an iTero™ scanner at EVERY CHAIR
Slide 8: From appliance to platform
2024 From appliance to platform iTero Lumina™ intraoral scanner iTero Multi-Direct Capture™ technology 2017 – 2023 ClinCheck® Smile Video Revenue Y/Y% 2001–2023 Invisalign First™ My Invisalign™ app LTM 20% - 30% +22.5% iTero Element™ 5D imaging system NIRI ClinCheck® Pro 6 2013 – 2016 exocad™ lab so
Slide 9: ©2024 Align Technology Inc. All rights reserved.
©2024 Align Technology Inc. All rights reserved.
Slide 10: Enormous Opportunity 600M
ENORMOUS OPPORTUNITY 600M Consumer Opportunity 15M teens 22M Annual ortho starts 7M adults ©2024, Align Technology Inc. All rights reserved.
Slide 11: Focused Execution: Strategic Growth Drivers
INTERNATIONAL PATIENT ORTHODONTIST GP DENTIST EXPANSION DEMAND UTILIZATION TREATMENT Focused Execution STRATEGIC GROWTH DRIVERS
Slide 12: Align's unique position and multivariable equation
Align's unique position and multivariable equation that is very difficult to replicate RELIABLE FINANCIAL RESULTS MANUFACTURING EXCELLENCE • • Excellent Top-line & profit growth • > 1M unique clear aligner parts / day • Strong Balance Sheet • > 59K treatment plans / day Proven & Scalable Technology
Slide 13: Q1 2024 CEO Opening Comments
Q1 2024 CEO Opening Comments • We’re pleased to report better than expected revenue and earnings for the first quarter and a solid start to the year. For Q1, total worldwide revenues were up 5.8% year-over-year, reflecting 3.5% growth from our Clear Aligner segment and 17.5% growth from Systems and
Slide 14: Q1 2024 Highlights
Q1 2024 Highlights ©2024,Align ©2024 Align Technology Technology Inc.Inc. All rights All rights reserved. reserved. 14
Slide 15: Q1 2024 Revenues and Operating Margin
Q1 2024 Revenues and Operating Margin TOTAL REVENUES TOTAL SYSTEMS AND SERVICES REVENUES TOTAL CLEAR ALIGNER REVENUES GAAP OP PROFIT MARGIN Q1'24 Q1'24 Q1'24 Q1'24 $997.4M $180.2M $817.3M $154.1M | 15.5% Q/Q +4.3% Y/Y +5.8% Q/Q +3.1% Y/Y +17.5% Q/Q +4.5% Y/Y +3.5% Q/Q (2.5)% pts Y/Y +1.3% pts Q1’23
Slide 16: Q1 2024 Clear Aligner segment
Q1 2024 Clear Aligner segment Americas International Non-Case Clear Aligner Metrics Clear Aligner Metrics Clear Aligner Metrics Americas Clear Aligner Shipments International Clear Aligner Shipments Non-Case Clear Aligner Revenues 0.0% Y/Y +5.3% Y/Y +7.5% Y/Y +6.4% Q/Q (2.3)% Q/Q ($M) +3.7% Q/Q $71.
Slide 17: Q1 2024 Invisalign DSP Touch-Up Cases
Q1 2024 Invisalign® Doctor Subscription Program (“DSP”) Touch-Up Cases 623 605 608 604 605 599 599 602 596 593 589 591 584 583 582 577 575 573 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Q2'23 Q3'23 Q4'23 Q1'24 Clear Aligner Shipments w/o Touch-up (K) Clear Aligner Shipments (K) Q1’22 Q2’22 Q3’22 Q4’22 Q1’23 Q2’2
Slide 18: 4.9M Teens and Kids treated with the Invisalign System
4.9M Teens and Kids treated with the Invisalign® System, to date • In the teen market, nearly 200K teens and younger patients started treatment with Invisalign clear aligners in Q1, up 5.8% Y/Y. This represents a record number of teen cases shipped as compared to prior first quarters, reflecting str
Slide 19: Invisalign Palatal Expander System
Invisalign® Palatal Expander System • We believe the Invisalign® Palatal Expander System is one of the most exciting innovations we have developed in our 27-year history and is a better option for expanding a growing patient’s narrow palate. The initial response from doctors and their patients for t
Slide 20: Dental Service Organization (DSO) Customers
Dental Service Organization (“DSO”) Customers • Q1’24 Clear Aligner volume from DSO customers increased sequentially, reflecting growth from the Americas and EMEA regions, and increased year-over-year, reflecting growth across international regions • DSOs represents a large and growing opportunity t
Slide 21: Q1 2024 connecting consumers with Invisalign doctors
Q1 2024 connecting consumers with Invisalign® doctors Delivering a best-in-class experience to achieve a happy and healthy smile through doctors The Invisalign® Brand Consumer Concierge service teams have connected tens of thousands of potential consumers with Invisalign doctors and reached millions
Slide 22: Invisalign is the Most Trusted Brand in Orthodontics
Invisalign® is the Most Trusted Brand in Orthodontics Q1 2024 Consumer Demand Creation and Digital Tools • Today, Invisalign is the most recognized orthodontic brand globally and Invisalign clear aligner treatment is faster and more effective than traditional metal braces, yet the underlying market
Slide 23: iTero intraoral scanners
iTero™ intraoral scanners Accelerating digital practice transformation The iTero scanner is at the front end of digital dentistry. Today, we have over 100K iTero scanners sold or roughly half of the intraoral scanning market globally. We have a scanner portfolio that consists of value to premium pro
Slide 24: iTero Lumina intraoral scanner
iTero Lumina™ intraoral scanner Our latest breakthrough technology in intraoral scanning We believe the iTero Lumina™ intraoral scanner has the potential to set a new standard of care for dental practices by simplifying the scanning of complex oral regions, while offering superior chair-side visuali
Slide 25: Q1 2024 Systems and Services segment
Q1 2024 Systems and Services segment Imaging Systems and CAD/CAM Services Systems and Services Revenues +17.5% Y/Y ($M) +3.1% Q/Q Intraoral digital scans for Invisalign® case submission $174.8 $180.2 95.6% 93.4% $153.3 90.6% 85.5% 86.9% 88.9% 82.8% 75.1% Q1'21 Q1'22 Q1'23 Q1'24 Q1'23 Q4'23 Q1'24* Am
Slide 26: Q1 2024 exocad Highlights
Q1 2024 exocad Highlights exocad announces more than 60K licenses sold • The total number of exocad licenses sold has reached more than 60,000 • More than 60,000 valued customers plan implants and create functional and refined restorations with exocad’s DentalCAD, ChairsideCAD and exoplan software w
Slide 27: Q1 2024 Financial Review
Q1 2024 Financial Review ©2024,Align ©2024 Align Technology Technology Inc.Inc. All rights All rights reserved. reserved. 27
Slide 28: Trended Revenues and Volumes
Trended Revenues and Volumes Q1’24 highlights +5.8% Y/Y Q1’24 Clear Aligner Case Volume +4.3% Q/Q +2.4% Y/Y $M $1,002.2 $997.4 +2.1% Q/Q $943.1 $960.2 $956.7 (#K) $169.5 $180.2 $153.3 $165.3 $174.8 590.9 622.6 602.3 592.6 605.1 $789.8 $832.7 $794.9 $781.9 $817.3 Q1'23 Q2'23 Q3'23 Q4'23 Q1'24 Q1'23*
Slide 29: Q1 2024 Financial Summary Commentary
Q1 2024 Financial Summary Commentary • Q1'24 Total revenues of $997.4M, +4.3% Q/Q and +5.8% Y/Y • Q/Q, Q1'24 revenues were favorably impacted by FX of ~$10.0M* • Y/Y, Q1'24 revenues were unfavorably impacted by FX of ~$4.8M* • Q1'24 Clear Aligners revenues of $817.3M, +4.5% Q/Q and +3.5% Y/Y • Q/Q,
Slide 30: Trended GAAP Gross Margins
Trended GAAP Gross Margins Q1’24 highlights 0.0% Y/Y 0.0% Q/Q • Overall Q1'24 gross margin was 70.0%, approximately flat Q/Q and Y/Y Q/Q, overall gross margin was favorably impacted by FX of ~0.3 pt Y/Y, overall gross margin was unfavorably impacted by FX of ~0.1 pt • Q1'24 non-GAAP gross margin was
Slide 31: Trended GAAP Operating Expense
Trended GAAP Operating Expense Q1’24 highlights +3.1% Y/Y +9.2% Q/Q $M • Q1'24 Operating expenses were $543.7M, +9.2% Q/Q and +3.1% Y/Y Q/Q, Q1'24 operating expenses +$45.7M, from higher incentive $527.1 $541.7 $543.7 compensation and consumer marketing spend, partially offset by $496.7 $498.0 restr
Slide 32: GAAP Operating Margin and Earnings Per Share Trends
GAAP Operating Margin and Earnings Per Share Trends Q1’24 highlights +1.3% pts Y/Y • Q1’24 Operating income of $154.1M resulted in an Q1’24 operating margin of 15.5%, (2.5) pts Q/Q and (2.5)% pts Q/Q +1.3 pts Y/Y Q1'24 Q/Q decrease in operating margin is primarily attributable to investments in our
Slide 33: Trended Quarterly Financials
Trended Quarterly Financials GAAP Gross Margin % Operating Expense ($M) Operating Margin % & EPS $527.1 $541.7 $496.7 $498.0 $543.7 70.0% 71.2% 70.0% 70.0% 69.1% 17.2% 17.3% 17.9% 15.5% 14.2% Q1'23 Q2'23 Q3'23 Q4'23 Q1'24 Q1'23 Q2'23 Q3'23 Q4'23 Q1'24 Q1'23 Q2'23 Q3'23 Q4'23 Q1'24 Diluted Earnings $
Slide 34: Q1 2024 Clear Aligner Revenue Per Case Shipment
Q1 2024 Clear Aligner Revenue Per Case Shipment Clear Aligner Revenue Per Case Shipment $1,400 $1,300 $1,200 $1,100 $1,000 $900 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Q2'23 Q3'23 Q4'23 Q1'24 Worldwide ASP $1,335 $1,315 $1,245 $1,225 $1,335 $1,335 $1,320 $1,320 $1,350 • Average Selling Price (“ASP”): Clear al
Slide 35: Balance Sheet, Cash Flow, & Stock
Balance Sheet, Cash Flow, & Stock • Of our $902.5M balance, $217.5M was held in the U.S. and Q1’23 Q4’23 Q1’24 $685.0M was held by our international entities ($ in millions except for DSO) • In January 2024, we received ~37K shares of our common stock Accounts Receivables, net $884.4 $903.4 $950.7 u
Slide 36: Closing Comments
Closing Comments ©2024,Align ©2024 Align Technology Technology Inc.Inc. All rights All rights reserved. reserved. 36
Slide 37: Fiscal 2024 business outlook
Fiscal 2024 business outlook Fiscal 2024 business outlook Now, turning to our outlook -- assuming no circumstances occur beyond our control we provide the following framework for Q2 and fiscal 2024: Second quarter 2024 outlook: For Q2’24, we provide the following business outlook: • We expect worldw
Slide 38: Q1 2024 Earnings Call CEO Closing commentary
Q1 2024 Earnings Call CEO Closing commentary • In summary, Q1 was a good start to the year. While we are pleased with our results, we are even more excited about Align innovation in 2024 and our next wave of growth drivers that we believe will continue to revolutionize the orthodontic and dental ind
Slide 39: ©2024 Align Technology Inc. All rights reserved.
©2024 Align Technology Inc. All rights reserved. 39
Slide 40: Appendix
Appendix ©2024,Align ©2024 Align Technology Technology Inc.Inc. All rights All rights reserved. reserved. 40
Slide 41: GAAP to Non-GAAP Reconciliation: Constant Currency Net Revenues
Unaudited GAAP to Non- GAAP Reconciliation Constant Currency Net Revenues Note: 1) We define constant currency net revenues as total net revenues excluding the effect of foreign exchange rate movements and use it to determine the percentage for the constant currency impact on net revenues on a seque
Slide 42: GAAP to Non-GAAP: Constant Currency Gross Profit and Gross Margin
Unaudited GAAP to Non- GAAP Reconciliation Constant Currency Gross Profit and Gross Margin Note: 1) We define constant currency gross margin as constant currency gross profit as a percentage of constant currency net revenues. Gross margin constant currency impact is the increase or decrease in const
Slide 43: GAAP to Non-GAAP: Constant Currency Income from Operations
Unaudited GAAP to Non- GAAP Reconciliation Constant Currency Income from Operations and Operating Margin Notes: 1) We define constant currency income from operations as GAAP income from operations excluding the effect of foreign exchange rate movements for GAAP net revenues and operating expenses on
Slide 44: GAAP to Non-GAAP: Financial Measures Other Than Constant Currency
Unaudited GAAP to Non- GAAP Reconciliation Financial Measures Other Than Constant Currency Notes: (1) Amortization of intangible assets related to certain acquisitions. (2) Restructuring and other charges recorded in Gross Profit and Operating expenses primarily relate to severance costs, lease term
Slide 45: Q2 2024 and Fiscal 2024 Outlook – GAAP to Non-GAAP Reconciliation
Q2 2024 and Fiscal 2024 Outlook – GAAP to Non-GAAP Reconciliation Notes: 1) Amortization of intangible assets related to certain acquisitions. ©2024 Align Technology Inc. All rights reserved.