Allurion Technologies Inc. Q2 FY2025 earnings call

• Vision for obesity care: GLP-1s have challenges with adherence and long-term efficacy. Allurion's new strategy focuses on metabolically healthy weight loss combining Allurion Program with low-dose GLP-1 therapy.
• Strategic pillars:
  • Commercial focus: Shifting towards partners promoting metabolically healthy weight loss, transitioning distributors and resizing sales force with 20% growth in relevant accounts.
  • R&D pipeline: Signed term sheet for manufacturing expansion and joint development of GLP-1 drug-eluting intragastric balloon, and continuing to invest in next-gen Allurion Balloon designs.
  • Clinical pipeline: Prospective multicenter study in Europe on combination therapy submitted to IRBs, and U.S. PMA submission for Allurion Balloon included supportive analyses from AUDACITY Study showing positive weight loss results.
• Second quarter results: Revenue $3.4M, operating expenses down 48% y/y, operating loss improved 26% y/y.

In the second quarter of 2025, Allurion Technologies reported revenue of $3.4 million, which was in line with the preannouncement. This was down from $11.8 million in the same period of 2024. Gross profit for the second quarter was $2.5 million, representing 74% of revenue, compared to $9.0 million or 76% of revenue in the same period of 2024. Sales and marketing expenses were $2.4 million in Q2 2025 vs $6.7 million in Q2 2024. Research and development expenses were $1.8 million vs $4.3 million. General and administrative expenses were $5.2 million vs $7.3 million. Loss from operations was $7.0 million vs $9.3 million in the same period of 2024.

• Reevaluating 2025 guidance due to short-term disruption from new strategy.
• Anticipate $1.5 million charges in Q3 2025 related to aligning operating expenses with new strategy.
• Expect operating expenses to decrease by approximately 50% in 2026 following restructuring.
• Cash and cash equivalents as of June 30, 2025, were $12.7 million.

• Disruption from strategic pivot in the short term.
• Potential delays in FDA approval process for the PMA submission.
• Adherence and cost issues associated with GLP-1 monotherapy that the combination therapy aims to address.

Q: How should we think about low-dose GLP-1s plus Allurion Gastric Balloon impacting overall cost for obesity care in short, medium, and long term?

A: Abroad, GLP-1s are inexpensive, adding low-dose to Allurion Program has minimal cost to patient. In U.S., prices expected to equilibrate. Combo therapy solves adherence, side effect, and muscle mass issues, leading to better health benefits and lower cost over time.

Q: Can you share percentage of total distributors retained and new distributor adds to get back to pre-pivot baseline?

A: Significant shift in strategy with distributors in Latin America and Middle East, process ongoing in second half of 2025, no specific percentage shared yet, expect disruption along the way.

Q: What's the potential FDA approval timing from submission of module #4?

A: Typically 180 days for feedback after last module submission, with modular submission, first three modules already addressed, additional analyses strengthen data, timing could be pulled in but will depend on FDA feedback.

Q: Is $1.8M R&D expense a good go-forward number for near term?

A: Yes, appropriate for second half of 2025, with restructuring, overall operating expenses expected to decrease by ~50% in 2026.

Q: How will the new strategy targeting combination use impact reengagement with accounts in France?

A: Positively, GLP-1 utilization expanding into bariatrics and GI channels in France, surgeons and gastroenterologists interested in using GLP-1s in combination with Allurion Program to avoid side effects and muscle wasting.