Unidentified Analyst: Got it. Thank you.
Operator: Thank you. One moment for our next question. And our next question comes from the line of Yuan Zhi from B. Riley. Your question, please.
Yuan Zhi: Thank you for taking our questions. I think some of those have been addressed, but maybe we can talk about the cash flow. So, the cash flow from operation was negative $42 million in 2023 and then the current 2024 guidance of cash burn is about $40 million while we have increased revenue and potentially lower cost. Brett, can you help us reconcile this? I understand you have completed the reorganization in early 2023.
Brett Hale: Yes, thank you Yuan for the question. So, you’re correct. Our guidance is increased revenue from ’23 to ’24. And as I highlighted in the previous question, we’re improving margin from we posted 43% gross margin in 2023 and our guidance is 45% to 50% for 2024. And then, we will have continued investments in the growth drivers, but we’ll be keeping our spending very laser focused and really tied to our growth initiatives. So, we feel comfortable with the approximately 40% or excuse me or $40 million of net cash burn for the year.
Yuan Zhi: Got it. I’m also curious about the visibility in 2024, given the performance in 4Q of 2023. Maybe another way to ask about this question is regarding the 2024 guidance, how confident are you guys to convert the current lease into revenue in 2024? Any pushback you are hearing from the customer right now?
Maria Sainz: Thank you, Yuan. I feel confident in the guidance we have provided. We are executing 2023 with important accomplishments that feed my confidence. They are our ability to really land deals in flagship institutions and then translate those into very powerful initial successes with their use of our device in patients that otherwise would have had a very different prognosis or outcome or time frame. Some of those have actually been public from the likes of the Weill Cornell accounts that we implemented just a few weeks ago. So, I feel really good about the kind of names that are now potentially reference sites for other sites to follow. I feel very confident in the way our customer success team is implementing programs.
I’m also incredibly enthusiastic by this international expansion that we have mentioned, which is not a peanut butter approach. We are definitely selecting markets to really put in incremental effort to draw commercial success from them. We’re bringing the product that we’re commercializing today in the U.S. and we have a lot of inbound interest from clinicians that I think are going to contribute to the revenue profile for 2024, and that actually allowed me to feel that, that guidance is reasonable, even where we’re tracking on U.S. plus the select international opportunities.
Yuan Zhi: Got it. Maybe on the last point, a follow-up question there, how are you guys standing on the direct-to-consumer approach versus distributor approach in the international footprint, considering the need to preserve the cash and invest on where it matters the most?
Maria Sainz: Excellent question. Thank you, Yuan. I would consider our international expansion to be a light investment as we are primarily going to operate international through third-party distributors. We are very fortunate that we have been in the background working to give ourselves the international optionality as we have made a lot of progress on regulatory clearances with the CE mark under NDR, not the old NDD, and the UKCA certification, which is now of course, required after Brexit. So, that gives us a bit of a readiness point in CE and UK geographies. But again we will operate through third-party distributors. You will see that affects our OpEx very marginally. However, as we go forward, we’ve been very proud of sort of record ASPs. We’re going to be posting more of a blended ASP, where the distributor pricing is, of course, going to be a different price point than direct to the customer sales that we do in the U.S. with the two sort of pricing increases that we’ve had over the last couple of years.
Brett Hale: Yes, I would add to the other point is that going back to the, I guess, confidence in the guidance. So, our international expansion is included in our guidance. So, I think that’s kind of further gives us confidence in the range that we provided here at the beginning of the year.
Yuan Zhi: Got it. Thanks for the additional help and color.
Maria Sainz: Thank you.
Operator: Thank you. This does conclude the question-and-answer session of today’s program. I’d like to hand the program back to Maria Sainz for any further remarks.
Maria Sainz: Thank you, Operator. Thank you, everyone, for listening into our call today. I’ve remained incredibly optimistic about what we’re building and the future of our business. I look forward to providing additional reports and updates to all of you in the coming weeks.
Operator: Thank you, ladies, and gentlemen, for your participation in today’s conference. This does conclude the program. You may now disconnect. Good day.
