So we’re going to be disciplined about it. We sort of have, if you will, the luxury of being disciplined about that because we don’t need every last dollar revenue when we have the growth of CAVT in the U.S. and coming to the rest of the world in out years. So, I think you’ll see more and more focus on that without taking away focus on the growth. And I think that’s an important – you’re seeing the beginning of that in the last couple of quarters. And I think you’ll see that continue pretty strong.
Joanne Wuensch: Thank you.
Adam Elsesser: Thank you.
Operator: And we’ll go next Lei Huang [Wells Fargo Securities, LLC].
Lei Huang: This is Lei calling in for Larry Biegelsen from Wells Fargo. Can you hear me okay?
Adam Elsesser: Yes. Hi Lei.
Lei Huang: Hi, by the way thanks for the question. My question is around the 2024 guidance, the 16% to 20% growth, the mid pointing at 18%. That’s quite a bit of deceleration. And thank you for the color on the breakdown. Can you talk a little bit about how to think about the sales cadence through the year, just given there’s so many different dynamics running through the different segments? And I have a follow-up.
Adam Elsesser: Yes. absolutely, Lei. Let me start by first thing I – we stand by our comment that we made actually at your conference last September when our – and our overall guidance reflects our confidence by projecting that we think 20% growth is achievable. I want to emphasize, though, that we also added a lot more transparency, which you alluded to, by providing guidance of our U.S. thrombectomy business where we project 27% to 30% growth. And that’s probably the most important – the more important number right now since it focuses on our CAVT platform, which is only right now in the U.S. And it also allows us to prepare our international markets in 2024 for our CAVT platform in the future. So we can have similar accelerated growth throughout the world in the following years.
And that’s how we’re thinking about the business. And I acknowledge that there’s a lot to digest, because we’ve given you a lot of different numbers and talked about our business in a slightly different way, but it’s also how we’re managing the business. That’s how we see the growth, that’s where the growth is, that’s what the excitement around the opportunity to finally do what we set out to do 20 years ago, which is with this platform, we have visibility. We have the strategy around making sure we can bring this to everyone who has caught their body from head to toe. We’re hearing that from large hospital systems, we’re hearing that from customers, we’re seeing that in the cases. So we’re trying to focus our energies on that opportunity and it takes some discipline because that hasn’t always been the sole focus of the company.
So you’re seeing that and how we’re thinking about our international business, our coil [ph] and access business with that focus right now. But again, what we’re thinking about is the other parts of our business matter, but the 27% to 30% growth in U.S. thrombectomy is our focus. And Jason, can follow up.
Jason Mills: Yes. Lei, just to follow up on that with respect to the cadence. So a couple of things I just want to repeat and go over again. We commented about that 27% to 30% in U.S. thrombectomy as well as the entire U.S. business at 22% to 25% delivering pretty consistent growth in that range through the year. So the cadence quarterly is primarily based on distributor order timing to which we have very good visibility as well as timing of product launches as well, to which we have, again, really good visibility, we believe. And so as Adam mentioned, we think that the U.S. thrombectomy number is the number to really look at primarily, and we’ve commented also that our international business should accelerate in 2025. We have a high degree of confidence in that as well.
Lei Huang: Thanks. That’s helpful. Just a clarification on what you just said, Jason. So U.S. growth overall is pretty consistent so it’s really the O-U.S. where you’re talking about the distributor timing that’s driving the mid-teens growth in first half versus second half at 20% or higher. Is that the best [ph]?
Jason Mills: That’s correct. And we have very good visibility into the timing. It’s just how they land throughout the year.
Lei Huang: Got it. Thanks. And just for my follow-up, can you talk about your assumptions for the U.S. vascular thrombectomy market growth in terms of what’s assumed in your guidance for both venous and arterial? Thanks.
Adam Elsesser: Yes. We won’t give specific breakdowns between those two, but the assumption – the fundamental basis of that is what I’ve alluded to now for the last month or so or that we saw a notable uptick in our trajectory in late November, and that has been consistent. It didn’t – it wasn’t a onetime event. It went up and it stayed at a different level, which gives us the confidence not only in those projections, but also in the consistency throughout the year. And the reason for that is what we’ve been saying throughout most of 2023, which is we had a lot of new customers, we saw a lot of them come through at the end of the very last days of November and into December, and that’s continued. And I think that momentum is continuing, which is why you hear the confidence we have right now in this platform and in this business.
You add into it, the dialogues we’re having with hospital systems and physicians, which is just nothing we’ve ever been able to have before. It gives us an awful lot of confidence that we’re headed in the right direction.
Jason Mills: Lei, just to add to that a little bit, in referencing again the U.S. thrombectomy growth of 27% to 30%, that includes VTE arterial, coronary and stroke. And while we’re really excited about cataracts and our stroke portfolios, with those, the growth rates implied for those thrombectomy franchise in the U.S. are lower than that range, VTE and arterial are expected to grow well above that range. Part of that strong growth is market growth, which is healthy. Again, market growth is best observed in arrears, I think, but it’s still healthy growth. And in addition to that, we expect, of course, to add to our share throughout the year.
Operator: We’ll go next to Bill Plovanic at Canaccord Genuity.
Bill Plovanic: Hey guys, thanks. Good evening and thanks for taking my question. Just some clarity here. So as we look at the U.S. thrombectomy, you launched flash starting early last year, you launched Bolt soon thereafter. So as we go into the first half of the year, it’s actually pretty easy comps as you keep the growth going. It sounds like you’re going to keep the growth going and then in the back half of 2024 at least in the U.S., it’s the sales force changes that really kind of help that growth continue in terms of the market access and all the work you’ve done on that. Am I thinking about that correctly? And then I have a follow-up.
Jason Mills: Yes. Hey Bill, it’s Jason. I’ll start and maybe Adam can chime in. We had a really strong first quarter last year with Flash, especially early on with our existing customers, and we actually had quite a bit of success with new customers early in that launch as well. Of course, that continued. So, I don’t know if there are any particular comps to point out that one quarter outweighing another. And that’s why we have pretty good confidence in the consistency with which those grow. The other thing I would point out is launching Lightning Flash 2.0 likely full launch later this quarter really won’t impact things until you get into the second quarter. And the other product launches were not factoring in too much through the year, just to sort of be conservative on that as well.
Bill Plovanic: Okay, thanks. And then just on Thunderbolt, I think some comments you made, I think, earlier in the year, is that now pushing into 2026 in terms of contributing to the U.S. thrombectomy business? And thanks for taking my questions.
Adam Elsesser: Yes, Bill, it’s a great question. Obviously, I’m going to be careful to give any kind of specificity on a trial that’s still ongoing. I think I learned my lesson the last time, so I’m going to resist. The trial is going well, we’re enrolling well, the cases are going well. We said during that time when we were resetting expectations around the timing of Thunderbolt that we have not put in our number for 2024 or 2025 any Thunderbolt revenue. And so that was what we said then, that’s still true whether or not it comes or not, we’ll deal with that at the time. But we’re not counting on Thunderbolt revenue until 2026 anyway, and I said that over a year ago or whenever that last month. So that’s stayed consistent.
So this is the growth that we’re talking about is in CAVT, is on – with Flash and Bolt in the new products going forward. And obviously, our stroke growth, which was significant in the fourth quarter, we continue to take share. A lot of that is really just on the extraordinary success continued success of RED 72 with SENDit, which is, as I said, just setting the standard, that is the catheter of choice now. We’ve gained more and more share, and I think it’s setting the table for Thunderbolt because, again, you need that catheter first, and then you can use Thunderbolt afterwards. So again, we remain very optimistic about the sort of one, two punch there with those two products.
Bill Plovanic: Okay. And a point of clarification on international, if I could, are you going to discontinue selling some products in some countries in the first half of this year? Is that what some of the delays and kind of the downdraft in U.S.? And thank for taking my questions.
Adam Elsesser: What we said was that in our embolization and access business, there are certain countries where reimbursement pricing just isn’t commensurate with sort of the value of the product, and we’re not – it’s not a profitable business. So we are using this opportunity, if you will, with the success that we’re having where we don’t need to do that, and they can use products that are more commensurate with what they want to pay for. And so yes, the answer is there are certain areas and countries that, that is true. So, we are going to focus on profitability in those markets.
Operator: We’ll take our next question from Robbie Marcus of JPMorgan.
Robbie Marcus: Great. Thanks for taking the questions. I want to ask, and I don’t want to belittle 29% growth at all because it’s a great growth rate. But this is the first time you’ve missed Street numbers since the IPO. And I would say at our conference in January you didn’t comment on the quarter, but you did sound pretty robust. So what happened during the quarter that you ended up missing the midpoint of your guidance range and the sell-side numbers?
Adam Elsesser: Yes. What you just said is true. But our Q4 revenue number, it was within our guidance. But obviously it fell just shy the consensus number. However, what led to my excitement at your conference, what’s led to excitement every single day since then into now, is the very – sort of fact that and I said it again today, we saw a notable uptick in our trajectory in late November. And that’s continued since then, which gives us the visibility, Robbie, and the confidence to guide our U.S. thrombectomy business to see a 27% to 30% growth in the U.S. this year. What’s not to like about that? That gives us an extraordinary amount of confidence about 2024 and beyond with the success of this. And we were waiting for this moment.
All these new accounts were coming and we saw that sort of moment happen. So what’s not to be like? And yes, I acknowledge without a doubt that there’s a couple of million dollars short from the consensus still within our guide. But I will assure you our entire team here is totally focused on 2024 and succeeding with this CAVT platform.
Robbie Marcus: Great. And maybe to follow up on a question from before about cadence. The U.S. you said should be within the guidance range pretty much throughout the year. O.U.S. lower at the beginning, higher at the end due to stocking. How do we think about the amount of stocking that we’re in the different quarters because when we just look from the outside, we see much more difficult comps in the back part of the year versus the first and higher dollar values. So how do we think about what the amount of stocking is so we could get a sense of underlying volume? Thanks.
Adam Elsesser: Yes, it’s a great question. Let me just make sure our terminology is sort of right, if you will. We don’t really do stocking, as that word is sort of sometimes considered and used. What we’re talking about in most of these international markets, not all because we’re direct in parts of Europe and so on, but is really distributor orders. Distributors tend to order. They all are slightly different. Some have different ordering patterns. We’ve seen this now, they’re not linear. They don’t order every week. They order most of the time quarter-by-quarter, but sometimes even less than that, and then go sell it. We get those order and those forecasted orders from them. We don’t give them numbers. We get those in advance.
And from those projected forecasted orders, we then put it into our number. On the thrombectomy side, all of those folks, I should say the vast majority of those folks know that CAVT is coming. So obviously they’re going to be careful and not order as much product when they know a better generation is coming, because they don’t want to be left with excess inventory. That’s just obvious and common sense. So we’re taking that into account and being thoughtful about it. The other part of it relates to the coil business, the embolization and access business. And I’ve already sort of addressed that. This is an opportunity now with us to focus that business in a way that allows us to retain our growth and profitability without really losing anything in the long, long run.
So some of those are sort of dipping away are negative, and we’re just putting that into a lot of transparency, which again, brings me back to the best measure, is our latest technology and the growth curve that we’re having. Because not only are we going to continue to have that for number of years, we think in the U.S., we think that will be replicated in international markets when those products get there, that’s sort of a good thing. So we’re getting the business ready to go in those international markets where we can have that kind of growth too.
Robbie Marcus: Thanks. And Adam, if I could just sneak in the size of those discontinued country sales. Thanks.
Adam Elsesser: When you add it all, it gets you to the numbers that we were alluding to. I don’t think by calling out each country and the size feels right on a public call. Those are great partners and great countries, and I think we can get to the same number without calling them out country by country. But I appreciate the question.
Robbie Marcus: Thanks a lot.
Adam Elsesser: Thanks.
Jason Mills: Thanks, Robbie.
Operator: We’ll move next to Pito Chickering at Deutsche Bank.
Pito Chickering: Hey, good afternoon. One quick clarification. Just looking at the comments from sort of 3Q of at least 20% growth for 2024. And then guidance today is the only difference between your commentary previously and where we are today is just slower international growth because you’re focused on profitability, or is there anything else?
Adam Elsesser: Yes. I think you’ve got it. That question implies really focusing on both the 27% to 30% growth in U.S. thrombectomy as well as taking that a step further with the entire portfolio of neuro access, embolization, et cetera, at 22% to 25% growth. And yes, the discipline we’ve talked about here with respect to certain international markets and timing is something we’ve been working on now for a little while and we’ve seen a little bit of as well in 2023. So we have pretty good visibility into this. But I think that is the difference that you’ve noted.
Pito Chickering: Okay, great. And then can we talk about the sales force for a minute? How many sales guys have you hired? What was the cadence of that hiring throughout the last 12 months? Where is the sales force for this new reps ramping up versus the demand? And do you have the right sales force today in order to meet your 2024 guidance, or do you need to hire more? And then last question, are you seeing any churn of season salesforce because of the new ads or is it looking pretty good?
