Vyome Holdings, Inc. Q1 FY2023 earnings call

• Three growth pillars: disciplined metrics-driven approach, expanding product portfolio/pipeline, and validating evidence-based weight loss solutions.
• Reduced operating expenses by 43% before onetime adjustments in Q1 2023.
• Marketing initiatives: Revamping lead generation, targeted digital campaign for Lap-Band, patient-centric website launch in Q3, and marketing automation with e-mail, text, call, and web retargeting.
• New products: Redesigned calibration tubes with 3 new sizes, and submission of a PMA supplement to the FDA for the next-generation Lap-Band 2.0.
• Scientific Advisory Board: First full meeting in June 2023 to provide insights on growth initiatives.
• IP portfolio: 155 patents, including a recent allowance for the ReShape Obalon Balloon System patent.

In the first quarter of 2023, revenue totaled $2.3 million, a 6.3% ($200,000) contraction from the same period in 2022. Gross profit was $1.2 million, representing 53.5% of total revenue compared to 49.9% in Q1 2022. Operating expenses were significantly reduced: sales and marketing expenses decreased by $2.5 million (53.5%), general and administrative expenses by $1.2 million (30.7%), and research and development expenses by $300,000 (39.2%). The company ended the quarter with $9.1 million in cash and cash equivalents and remains debt-free.

• Anticipate revenues to increase steadily in 2023.
• Continue to control and reduce operating expenses.
• Sufficient cash on hand to fund operations into 2024.

• Market changes and competition from weight loss drugs could impact Lap-Band surgeries.
• Dependence on successful execution of marketing and product development initiatives.
• Uncertainty around FDA approval of Lap-Band 2.0.

Q: What metrics are used to gauge the success of the new marketing campaign and when can we see benefits?

A: Metrics will be shared quarterly as the call center is in-house, allowing detailed tracking of lead generation, nurturing, and conversion. Benefits will be seen as the marketing campaign progresses, with improvements tracked through website launches and lead transfer to surgeons.

Q: Have bariatric surgeons seen hesitation from patients due to popular weight loss drugs, and how is this impacting procedures?

A: Most surgeons haven't seen impact on procedure volume yet, but some anecdotal slowdowns exist. Marketing efforts retain patients, and surgeons are considering combination therapies with weight loss drugs and surgery.

Q: What's the reception of ReShapeCare and is it cross-sold with the Lap-Band?

A: Strong interest from large self-insured employers. ReShapeCare is cross-sold with Lap-Band sales, positioned as a comprehensive weight loss tool during employer annual enrollment periods.