Glaukos Q2 Earnings In Line, Glaucoma Drives Sales

Glaukos Corporation GKOS reported second-quarter 2024 adjusted loss of 52 cents per share, in line with the Zacks Consensus Estimate. The figure was narrower than the year-ago quarter's adjusted loss of 55 cents per share.

The GAAP loss per share was $1.06 compared with the prior-year quarter's reported loss of 68 cents.

Revenue Details

Glaukos registered revenues of $95.7 million in the second quarter, up 19% year over year on a reported basis and 20% at constant currency (cc). The figure also surpassed the Zacks Consensus Estimate by 8.2%.

Quarter in Detail

The company recorded net sales of $75.9 million and $19.8 million for Glaucoma and Corneal Health, respectively, up 23% and 7% year over year.

Margin Trend

Gross profit increased 21.3% to $73.1 million. The adjusted gross margin was flat year over year at 82%.

Selling, general and administrative expenses rose 25% to $66.2 million. Research and development expenses totaled $34.4 million, up 4% year over year. Total operating expenses were $104.4 million, up 17.6% from that recorded in the prior-year period.

The operating loss amounted to $30 million compared with $32.9 million in the year-ago period. The adjusted operating loss was $23.7 million, wider than the year-ago quarter's reported loss of $22.8 million.

Financial Update

Glaukos exited the second quarter of 2024 with cash and cash equivalents and short-term investments of $266.4 million compared with $278.7 million at the end of the last reported quarter.

2024 Guidance

The company revised its guidance for 2024 revenues. It now expects net sales to be in the range of $370-$376 million compared with the previous guidance of $357-$365 million. The Zacks Consensus Estimate for the same is pegged at $362.8 million.

Our Take

Glaukos' second-quarter 2024 earnings met the Zacks Consensus Estimate, while revenues beat the same. Management remains excited regarding the company's continued top-line growth in the reported quarter.

During the second quarter, GKOS' glaucoma franchise witnessed growth in revenues, driven by its iStent portfolio, coupled with growing contributions from iDose TR. The company commenced the initial phases of the controlled launch plan for iDose TR during the reported quarter. The unique permanent J-code for iDose TR became effective from Jul 1. This is likely to increase patient access, driving sales growth in the upcoming quarters. The franchise also benefited from rapid international expansion.

GKOS continues to invest in its product pipeline. It targets NDA submission for its corneal cross-linking therapy, Epioxa, by the end of 2024, which is currently progressing toward the second Phase 3 pivotal trial completion. The company remains on track to start a pivotal study on its next-generation iDose therapy, iDose TREX, by the end of 2024.

However, GKOS' operating loss in the reported quarter amid rising costs and expenses raised our apprehension. Its operation in a stiff, competitive market is also worrisome.

Zacks Rank & Stocks to Consider

Cencora currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader medical space that have announced quarterly results are Boston Scientific Corporation BSX, Hologic HOLX and Universal Health Services.

Boston Scientific reported second-quarter 2024 adjusted EPS of 62 cents, which beat the Zacks Consensus Estimate by 6.9%. Revenues of $4.12 billion surpassed the Zacks Consensus Estimate by 2.5%. It currently carries a Zacks Rank of 2 (Buy).

Boston Scientific has a long-term growth rate of 12.5%. BSX's earnings surpassed estimates in each of the trailing four quarters, the average surprise being 7.18%.

Hologic, carrying a Zacks Rank of 2 at present, has a long-term growth rate of 7.4%. Its earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 4.50%.

Hologic reported second-quarter 2024 adjusted EPS of $1.06, which beat the Zacks Consensus Estimate by 3.9%. Revenues of $1 billion surpassed the Zacks Consensus Estimate by 1.1%.

Universal Health Services reported second-quarter 2024 adjusted EPS of $4.31, which beat the Zacks Consensus Estimate by 27.9%. Revenues of $3.9 billion surpassed the Zacks Consensus Estimate by 1.5%.

Universal Health Services has a long-term growth rate of 18%. UHS' earnings surpassed estimates in each of the trailing four quarters, the average surprise being 14.58%.

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