Irhythm Holdings, Inc. · NASDAQ:IRTC
Irhythm — Q4 2023 Earnings Presentation
22 slides from Irhythm's earnings presentation, Feb 22, 2024
Slide 1: Fourth Quarter 2023 Results
iRhythm Technologies Fourth Quarter 2023 Results February 22, 2024
Slide 2: Safe harbor statement
Safe harbor statement Certain data in this presentation was obtained from various external sources, and neither “iRhythm” or the You should not rely upon forward-looking statements as predictions of future events. Although we believe that “Company” nor its affiliates or representatives has verified
Slide 3: Key metrics and 2024 revenue estimate
~$575 - $585 ~25 - 30% million iRhythm penetration in core U.S. ambulatory cardiac Estimated full year 2024 revenue monitoring market >22% 5+ million Registration growth in 4Q23 Target market opportunity compared to 4Q22 across prioritized EU and APAC countries a Approaching 100+ Original scientific
Slide 4: A transformational year for iRhythm
A transformational year for iRhythm ACCELERATING PROVIDING A BRINGING GENERATING MOMENTUM IN WINNING INNOVATIVE PEER-REVIEWED EXPANDING OPERATING WITH EHANCING COMMERCIAL CUSTOMER PRODUCTS TO CLINICAL MARKET ACCESS DISCIPLINE FINANCIAL BUSINESS EXPERIENCE MARKET EVIDENCE COVERAGE AND EFFICIENCY SUST
Slide 5: CAMELOT: Cardiac Ambulatory Monitor EvaLuation of Outcomes and Times to events
CAMELOT: The Cardiac Ambulatory Monitor EvaLuation of Outcomes and Times to events Compared with all other monitoring services, Zio XT was associated with: 1. Reynolds et al. American Heart Journal, 2023. https://www.sciencedirect.com/science/article/pii/S0002870323003459?via%3Dihub. 2. Specified ar
Slide 6: Accelerating growth in PCP channels key to capturing U.S. opportunity
Accelerating growth in PCP channels key to capturing U.S. opportunity ~21% of 2023 US Zio XT and Zio monitor registrations written by PCPs PCPs in integrated delivery networks and large national accounts driving penetration & TAM expansion Registrations from PCPs and other physicians additive to tho
Slide 7: Leadership in long-term continuous monitoring with room for upside in MCT
Leadership in long-term continuous monitoring with substantial room for upside in mobile cardiac telemetry market LTCM MARKET SHARE MCT MARKET SHARE (OF 2.5 MILLION ANNUAL TESTS) (OF 900,000 ANNUAL TESTS) Growing 17% Growing 7% annually annually 7% 70% Every 10% gain in market share represents $80-1
Slide 8: International opportunity represents $1+ billion with 5+ million TAM
International opportunity represents $1+ billion with 5+ million TAM in prioritized countries across EMEA and Asia Pacific PRIORITIZED EU COUNTRIES Switzerland, Spain, Sweden, the JAPAN UNITED KINGDOM Netherlands, Germany and France Pursuing regulatory approval via Early commercialization Initiating
Slide 9: Continued innovation a key to our competitive advantage
Continued innovation a key to our continued competitive advantage ZIO MONITOR LAUNCH THE LARGEST IN COMPANY HISTORY MYZIO APP SUPPORTS PATIENTS ON MONITORING JOURNEY iRhythm, Zio, Zio XT, Zio AT, MyZio, and ZioSuite are trademarks of iRhythm Technologies, Inc. © 2023. 1. Data on file. iRhythm Techno
Slide 10: Next generation Zio AT will strengthen competitive positioning in MCT
Next generation Zio AT will strengthen competitive positioning in MCT Zio AT Zio MCT IMPROVED FORM FACTOR • Better adhesion and battery • Same platform as Zio monitor ENHANCED ARRHYTHMIA DETECTION & BETTER REPORTING • Advanced software for enhanced detection parameters • Improved final wear report w
Slide 11: Artificial intelligence and deep learning underpins core capabilities
Artificial intelligence and deep learning underpins core capabilities Prediction of Atrial Fibrillation Curated heartbeat data and other data Insight Prediction of Generation Heart Failure linkages opens opportunities for additional expansion Artificial Intelligence Evolving from diagnosis to diagno
Slide 12: Fourth quarter 2023 financial performance
Fourth quarter 2023 financial performance GLOBAL NET REVENUE GROSS PROFIT MARGIN (USD, MILLIONS) $132.5 69.9% 69.5% $124.1 $124.6 67.9% $112.6 $111.4 66.2% 66.0% 4Q2022 1Q2023 2Q2023 3Q2023 4Q2023 4Q2022 1Q2023 2Q2023 3Q2023 4Q2023 ADJUSTED OPERATING EXPENSES ADJUSTED EBITDA MARGIN (USD, MILLIONS) R
Slide 13: 2024 annual revenue and profitability guidance
2024 annual revenue and profitability guidance NET REVENUE GROSS MARGIN ADJUSTED EBITDA (USD, MILLIONS) MARGIN ~$575 – ~ 68 % – ~ 3%– 4% $585 69% of of million revenues revenues Significant growth in core business with leverage to drive long-term market expansion opportunities Adjusted operating exp
Slide 14: Near-term opportunities can drive significant topline growth
Near-term opportunities can drive significant topline growth Global net revenue (USD millions) U.S. CORE COMMERCIAL BUSINESS • Further expansion into PCP channel • Alternate use cases (e.g., PFA) to expand monitoring $1,000 • MCT market expansion with continued innovation INTERNATIONAL EXPANSION ~$5
Slide 15: Levers for adjusted EBITDA margin expansion
Levers for adjusted EBITDA margin expansion being driven by global scale and operational efficiencies GROSS MARGIN LEVERAGE OPPORTUNITIES OPERATING EFFICIENCY OPPORTUNITIES UNIT COST REDUCTIONS RESEARCH & DEVELOPMENT • Moving to a reduced product footprint and a unified hardware • Anticipate R&D rem
Slide 16: Addressing the future focus of healthcare
Addressing Expanding the future focus existing markets of healthcare while extending into adjacent markets Out-paced Delivering revenue growth meaningful from massive improvements in underpenetrated financial profile markets on a global scale
Slide 17: Appendix
iIRHYTHM Appendix
Slide 18: Reconciliation of Net loss to Adjusted EBITDA
Reconciliation of Net loss to Adjusted EBITDA Adjusted EBITDA is a non-GAAP measurement of net loss or income excluding interest, taxes, depreciation and amortization, stock-based compensation expense, impairment and restructuring charges, and business transformation costs. We believe that adjusted
Slide 19: Reconciliation of GAAP to Non-GAAP financial information
Reconciliation of GAAP to Non-GAAP financial information THREE MONTHS ENDED DECEMBER 31, YEAR ENDED DECEMBER 31, ADJUSTED NET LOSS RECONCILIATION 2023 2022 2023 2022 Net loss, as reported $ (38,699) $ (20,198) $ (123,406) $ (116,155) Impairment and restructuring charges 11,078 — 11,078 26,608 Busine
Slide 20: Sources
Sources SLIDE SOURCES Cardiac arrhythmia burden in the U.S. is immense Morillo CA, Banerjee A, Perel P, Wood D, Jouven X. Atrial fibrillation: the current epidemic. J Geriatr Cardiol. 2017 Mar;14(3):195-203. Weng, Lu-Chen et al. Genetic Predisposition, Clinical Risk Factor Burden, and Lifetime Risk
Slide 21: Sources
Sources SLIDE SOURCES OUS opportunity represents $1+ billion with UK: iRhythm estimate. UK Office for National Statistics; Hospital Episode Statistics, NHS Digital, 2019-2020; UK Healthcare 5+ million TAM in prioritized countries across Market Review 33ed, LaingBuisson, 2021. Accessed 5 January 2022
Slide 22: Sources
Sources SLEEP APNEA MARKET SIZING HYPERTENSION MARKET SIZING: 1. Franklin, K. A., & Lindberg, E. (2015). Obstructive sleep apnea is a common disorder in the 1. Bhalia, S., Pallangyo, P., Dalidali, A., Salum, S., Kawajika, R., Kajuna, E., population—a review on the epidemiology of sleep apnea. Journa