Align Technology credited global economic headwinds and poor foreign exchange for a decline in revenue in Q3 2022.
Align Technology, a global medical device company that designs, manufactures, and sells the Invisalign system of clear aligners, iTero intraoral scanners, and exocad CAD/CAM software for digital orthodontics and restorative dentistry, today reported financial results for the third quarter of fiscal 2022.
Third quarter total revenues were $890.3 million, down 8.2% sequentially and down 12.4% year-over-year. Clear Aligner revenues were $732.8 million, down 8.2% sequentially and down 12.5% year-over-year and volume was down 3.6% sequentially and down 11.9% year-over-year.
Imaging Systems and CAD/CAM Services revenues were $157.5 million, down 11.7% year-over-year.
Clear Aligner revenues were unfavorably impacted by foreign exchange of approximately $21.0 million or 2.8% sequentially and roughly $47.4 million or 6.1% year over year.
Operating income was $143.7 million resulting in an operating margin of 16.1%. Net income was $72.7 million, or $0.93 per diluted share. On a non-GAAP basis, third-quarter net income was $106.5 million, or $1.36 per diluted share.
Commenting on Align’s third quarter results, Align Technology President and CEO Joe Hogan said,
“Our third quarter results reflect continued macroeconomic uncertainty and weaker consumer confidence, as well as a significant impact from unfavorable foreign exchange rates across all currencies that affect our operations,” said Joe Hogan, Align Technology president, and chief executive officer. “We remain confident in the execution of our strategic growth drivers despite the continuing economic headwinds.”
The company reached its 14 millionth Invisalign patient milestone, which includes nearly 4 million teenagers and kids as young as 6 years old who have been treated with Invisalign clear aligners.
Also in Q3, teen case starts of 200,000 were up 13% sequentially and off slightly compared to the same quarter in 2021 when a record 206,000 teenagers started Invisalign treatment.
The company plans to launch several new products and technologies that enhance the Align Digital Platform. During the quarter, Align began commercializing ClinCheck Live Update software, Invisalign Practice App, Invisalign Personal Plan, Invisalign Smile Architect, the Invisalign Outcome Simulator Pro with in-face visualization, Cone Beam Computed Tomography integration with ClinCheck software, Invisalign Virtual Care AI software, and the iTero-exocad Connector.
“These technology advancements represent an important expansion of our digital platform that we believe will help our doctor customers increase treatment efficiency and deliver superior clinical outcomes and patient experiences positioning us to drive growth when the markets inevitably rebound,” said Hogan.