Analyst Looks For Improvement Signs For Nevro's Core Market In 2023 After Mixed Q4 Earnings - Nevro (NYSE:NVRO)

Nevro Corp NVRO reported Q4 FY22 sales of $113.8 million, up 11% Y/Y as reported and 12% constant currency, beating the consensus of $113.40 million.
Painful diabetic neuropathy (PDN) indication sales of approximately $17.3 million grew 329%, bringing the first full-year sales to approximately $48.0 million.
Q4 FY22 U.S. trial procedures increased by 9%, while U.S. PDN trial procedures grew to 20% of total U.S. trials in the quarter.
Guidance: Nevro expects Q1 FY23 sales of $94-$96 million vs. the consensus of $97.51 million.
PDN indication Q1 sales are expected to be approximately 15% to 20% below Q4 FY22 and then expected to grow each quarter sequentially for the remainder of 2023.
The company expects a Q1 adjusted EBITDA loss of approximately $(19)-$(20) million.
For FY23, Nevro forecasts sales of $445-$455 million vs. the consensus of $449.24 million, including approximately $75-$85 million in PDN indication sales.
William Blair writes that the ramping-up launch of the company’s next-gen HFX iQ AI system through the year has the potential to compound the benefits of an improving core market.
Investors will wait for more definitive signs of these potential tailwinds, especially as they weigh potential headwinds from macro conditions, competitive systems, lackluster core market growth, and an evolving reimbursement landscape.
Shares trade at 2.6 times on the updated 2023 sales estimate. The analyst reiterates the Market Perform rating.
Price Action: NVRO shares closed higher by 3.08% at $39.51 on Thursday.

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