And so when you start to think about effectuating surgery over a long period of time, this foundational standard becomes so important. And so I would say that that’s probably is the best without being overtly verbose, even though I write in verbose. But anyways, it just becomes like when you start to think about informatics, informatics is going to be what rules a day, it’s not going to be the pitch on a pedicle screw, it’s not going to be a specific interbody device. And our foundation of informatics sources is outstanding and that’s why the longevity of our view and the opportunity we see to ultimately make spine surgery better is so great.
Operator: The next question comes from Brooks O’Neil with Lake Street Capital Markets.
Brooks O’Neil: I’m just hoping we kind of beat around the bush a little bit, but maybe you guys can talk about the impact of ongoing consolidation in the spine space and whether you see that as a positive or negative for ATEC?
Pat Miles: So it’s a question that clearly has come our way a fair amount. And my genuine view is what we need to do is create clinical distinction, compel surgeon adoption and expand the sales force. And I would tell you, there’s a lot of people out there that are aligned with our thinking. And so what I would say is we’re going to be opportunistic as we can be. The one thing that we love is chaos. If there’s chaos out there, we’re going to be opportunistic with regard to that chaos. And our interest is long beyond any consolidation. We’re laughing today that we still have 95% of the market to address. 4% to 5% market share holder, we got a long runway. And our enthusiasm as we’ve spoken from the beginning is to be the standard bearer, we want to be the guys that make the rules in this business because we understand the requirements better than anybody.
And so that’s how we think about it. Candidly, you know, we’re indifferent to anybody else. Our focus is on what we’re doing.
Operator: Your next question comes from the line of Kyle Rose with Canaccord.
Kyle Rose: So I just wanted to — I understand the leverage commentary when we think about this year, about 30% drop through on incremental revenues. Maybe just help us zoom out from a big picture perspective, and how we should think about that on a longer term basis. Obviously, as you scale the sales force and make additional investments, whether it’s this year or you get productivity from previous cohorts. How should we think about that drop through on a ratable basis beyond 2023?
Todd Koning: Well, Kyle, I think when we laid out our long range plan and we kind of said, going from 2021 to 2025 and then in 2025 be in a $555 million in revenue and $80 million of adjusted EBITDA, and I think that’s about 12%, 13%, 14% adjusted EBITDA margin in 2025. And so as we did that walk, we said, call it, two thirds of that’s going to come from our leveraging of the infrastructure and the investments that we have made and the balance will come from improvement in our variable selling expenses. And ultimately, I think that’s really where we are headed. And so I think on the margin you can kind of do the math year-over-year on that. But ultimately, that’s the direction we are headed and the plan we’ve laid out relative to profitability profile.
