NASDAQ$ALGN

Align Technology Inc · Q3 2023 earnings

Q3 2023 earnings · · Investor relations

Briefing

Announced third quarter results with revenue increase and strategic investments.

Align Technology reported a 7.8% year-over-year increase in total revenues, reaching $960.2 million. The company's diluted net income per share was $1.58, with a non-GAAP diluted net income per share of $2.14. Record clear aligner shipments to teenage patients drove growth.

  • Total revenues increased 7.8% year-over-year to $960.2 million.
  • Diluted net income per share was $1.58, and non-GAAP diluted net income per share was $2.14.
  • Clear Aligner revenues increased 8.5% year-over-year, totaling $794.9 million.
  • Imaging Systems and CAD/CAM Services revenues increased 4.9% year-over-year, reaching $165.3 million.

Headline financials

Total Revenue

$960M

Previous: $890M+7.8%
EPS (adj)

$2.14

Previous: $1.36+57.4%
Clear Aligner Shipments

602.3K

Previous: 577.2K+4.4%
Capital Expenditures

-$144M

Previous: -$239M+39.5%
Free Cash Flow

-$22.9M

Previous: -$166M+86.2%
Net Income

$121M

Previous: $72.7M+67.0%
Operating Income

$166M

Previous: $144M+15.8%
Gross Profit

$663M

Previous: $619M+7.1%
Cash & Equivalents

$1.28B

Previous: $1.04B+22.9%
Total Assets

$6.32B

Previous: $5.91B+6.9%
Stock-Based Comp

$39.6M

Previous: $32.9M+20.3%

Revenue & EPS history

Align · Revenue · Quarterly

$960M

Q3 2023+7.8%vs Q3 2022
Beat estimate in 7 of 15 quarters(47%)
ActualEstimate

Revenue by segment

Align · $960M total across 2 segments · Q3 2023

  • Clear Aligner
    $795M
  • Imaging Systems and CAD/CAM Services
    $165M+5.0%

Forward guidance

For Q4 2023, Align anticipates worldwide revenue to be in the range of $920M to $940M, down sequentially from Q3 2023. GAAP operating margin is expected to be down sequentially, while Non-GAAP operating margin is anticipated to be up sequentially.

Tailwinds

  • Non-GAAP operating margin is anticipated to be up sequentially from Q3 2023.
  • The company expects to repurchase up to $250.0 million of its common stock in Q4 2023.
  • Continued innovation in digital treatment planning for orthodontics and restorative dentistry.
  • New digital tools gaining adoption and helping doctors gain efficiencies.
  • Planned launch of the Invisalign Palatal Expander (IPE) System in Canada this quarter.

Headwinds

  • Worldwide revenue is expected to be down sequentially from Q3 2023, in the range of $920M to $940M.
  • Both Clear Aligner and Systems and Services Revenues are expected to be down sequentially.
  • Clear aligner teen volume is expected to be seasonally lower in Q4 2023, with no anticipated improvement in adult volumes.
  • Clear aligner ASPs are expected to be down sequentially due to the strengthening US dollar.
  • Increasing headwinds from macro uncertainty and potential supply issues related to the war in the Middle East are anticipated for the Systems and Services business.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2023

Historical avgQ3 2023

+2.5%

Avg return

Earnings day

+2.0%

Avg return

5 days after

+2.3%

Avg return

30 days after

66%

45 / 68 earnings

Positive

+35.5%

Q3 2020

Best reaction

-28.2%

Q3 2023

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-1.5%-5.4%-2.0%
Q4 2025+8.9%+21.7%+7.9%
Q3 2025+5.0%+2.9%+11.6%
Q1 2025+2.0%-0.1%+4.4%
Q4 2024+0.9%-2.7%-19.7%
Q3 2024+2.7%+2.4%+7.2%
Q2 2024-9.8%-10.6%-6.7%
Q1 2024-0.4%-2.3%-18.0%
Q4 2023+3.3%+4.1%+13.3%
Q3 2023-28.2%-29.7%-17.3%
Q2 2023+16.0%+13.8%+7.3%
Q1 2023-9.6%-9.7%-18.8%
Q4 2022+33.4%+27.0%+24.0%
Q3 2022-16.7%-10.9%-10.7%
Q2 2022+12.1%+12.3%+0.2%
Q1 2022-15.7%-14.5%-21.2%
Q4 2021-1.0%-1.6%-8.7%
Q3 2021+6.5%+11.5%+6.9%
Q2 2021+8.2%+11.9%+12.2%
Q1 2021-2.8%-3.5%-5.1%
Q4 2020+10.3%+8.0%-3.8%
Q3 2020+35.5%+35.8%+33.4%
Q2 2020-5.2%-2.1%-6.7%
Q1 2020+5.6%+3.3%+20.7%
Q4 2019-1.8%-5.5%-18.5%
Q3 2019+16.8%+17.2%+28.5%
Q2 2019-26.4%-28.2%-35.9%
Q1 2019+0.2%+7.2%+5.2%
Q4 2018+5.1%+10.2%+16.9%
Q3 2018-25.5%-30.1%-29.8%
Q2 2018-2.6%-6.4%-1.3%
Q1 2018+8.4%+4.3%+32.9%
Q4 2017-5.3%-7.0%-11.3%
Q3 2017+16.9%+18.5%+26.3%
Q2 2017+9.1%+6.8%+8.7%
Q1 2017+12.4%+12.0%+18.7%
Q4 2016+8.1%+6.5%+15.7%
Q3 2016+3.6%+6.8%+14.5%
Q2 2016+4.7%+6.1%+8.8%
Q1 2016-3.5%
Q4 2015+7.7%
Q3 2015+10.4%
Q2 2015-7.4%
Q1 2015+5.8%
Q4 2014-9.4%
Q3 2014+7.3%
Q2 2014+6.1%
Q1 2014-2.4%
Q4 2013+2.9%
Q3 2013+32.6%
Q2 2013+10.4%
Q1 2013+2.3%
Q4 2012+9.0%
Q3 2012-26.4%
Q2 2012+10.8%
Q1 2012+13.7%
Q4 2011-2.1%
Q3 2011+2.9%
Q2 2011-4.3%
Q1 2010-2.0%
Q1 2011+1.6%
Q4 2010+5.1%
Q4 2008+5.1%
Q3 2009+6.3%
Q3 2010+6.3%
Q4 2009+0.4%
Q2 2010+0.4%
Q2 2009+0.4%

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