“Growth of the SP platform will continue to be gated by additional clinical indications and clearances in market beyond the U.S. and Korea.”

In context

“sequential decline primarily reflects lower stocking orders associated with lower system placements, hospital ordering patterns and a small unfavorable impact from FX. We placed 34 Ion systems in the quarter, as compared to 14 Ion placements in the first quarter of last year. The installed base of Ion systems is now 163 systems of which 70 are under operating lease arrangements. First quarter Ion procedures of just over 3,900 are up over 4x compared to the first quarter of 2021. Seven of the systems placed in the first quarter were SP systems, including three systems placed at customers in Korea. Our installed base of SP systems is now 106. First quarter SP procedures grew approximately 36% year-over-year with approximately 50% growth in transoral procedures small but high-value segment. Growth of the SP platform will continue to be gated by additional clinical indications and clearances in market beyond the U.S. and Korea. Moving on to gross margin and operating expenses. Pro forma gross margin for the first quarter of 2022 was 69.8%, compared with 71.8% for the first quarter 2021 and 70.1% last quarter. Pro forma gross margin was lower than last quarter, primarily as a result of higher logistics costs and increased fixed costs relative to revenue, as we invest in our infrastructure and manufacturing capacity to serve our long-term needs. While net inventory grew approximately $66 million quarter-over-quarter, there are still a number of components and products that are below our targeted levels. Pro forma operating expenses increased 26% compared with the first quarter 2021. The increase in first quarter operating expenses from a year ago reflected an, increase in head count increased variable compensation”