Align Technology reported lower than expected demand in the first half of 2023 in the company’s Q3 financial report.
Align Technology reported financial results for the third quarter of 2023, recording total revenues of $960.2 million, down 4.2% sequentially and up 7.8% year-over-year.
Clear Aligner revenues were $794.9 million, down 4.5% sequentially and up 8.5% year-over-year. Clear Aligner volume was down 3.3% sequentially and up 2.3% year-over-year. Imaging Systems and CAD/CAM Services revenues were $165.3 million, down 2.5% sequentially and up 4.9% year-over-year.
Clear Aligner revenues were unfavorably impacted by foreign exchange of approximately $2.0 million or 0.3% sequentially and favorably impacted by approximately $3.8 million or 0.5% year-over-year.(1) Q3’23 Imaging Systems and CAD/CAM Services revenues were unfavorably impacted by foreign exchange of approximately $0.7 million or 0.4% sequentially and favorably impacted by approximately $0.4 million or 0.3% year-over-year.(1)
“Our third quarter results reflect lower than expected demand and a more difficult macro environment than we experienced in the first half of 2023,” said Joe Hogan, Align Technology president and chief executive officer. “Dental practices and industry research firms have reported deteriorating trends, including decreased patient visits and increased patient appointment cancellations, along with fewer orthodontic case starts overall, especially among adult patients.”
Hogan referenced a September Gaidge report, that showed a deceleration for orthodontic treatment with new orthodontic patient appointments down 8.7% year-over-year and ortho case starts were down 6.9% year-over-year, reflecting the biggest decrease in over a year.
Despite these headwinds, total Q3 worldwide revenues were up 7.8% year-over-year with growth across all regions. The company reported record clear aligner shipments to teenage and younger patients, which increased 9.9% sequentially and 8.4% year over year, driven by strength from Invisalign First.
“We are committed to balancing our investments in near- and long-term growth drivers while delivering improvement in operating margin,” said Hogan. “As we navigate one of the most challenging operating environments in recent history, with increasing macro-economic pressure on doctors and their patients, we have an enormous opportunity to continue driving adoption of digital orthodontics and restorative dentistry, and a responsibility to optimize our investments for the current environment.”