RxSight, Inc.

Previous wording

Our commercial efforts began in 2019 and have been primarily focused in the United States, where we are building a “razor and razor blade” business model to drive new customer adoption and ongoing LAL volume growth. Our United States commercial organization includes a direct sales team of LDD sales personnel and LAL account managers, as well as clinical specialists, field service engineers and marketing personnel. Our sales efforts are concentrated on the roughly 4,000 U.S. cataract surgeons that perform 70%-80% of all premium IOL procedures. As of September 30, 2024, we had established an installed base of 888 LDDs in ophthalmology practices and, since our inception through September 30, 2024, surgeons have implanted over 165,000 LALs.

Current wording

Our commercial efforts began in 2019 and have been primarily focused in the United States, where we are building a “razor and razor blade” business model to drive new customer adoption and ongoing LAL volume growth. Our United States commercial organization includes a direct sales team of LDD sales personnel and LAL account managers, as well as clinical specialists, field service engineers and marketing personnel. Our sales efforts are concentrated on the roughly 3,500 U.S. cataract surgeons that perform 70%-80% of all premium IOL procedures. As of March 31, 2025, we had established an installed base of 1,044 LDDs in ophthalmology practices and, since our inception through March 31, 2025, surgeons have implanted approximately 223,000 LALs.

Previous wording

During the quarter ended September 30, 2024, we had increased LDD sales of 12 and increased LAL sales of 10,897 when compared to the quarter ended September 30, 2023 from strong adoption of our RxSight technology by practices and doctors combined with an increased LDD installed base.

Current wording

During the quarter ended March 31, 2025, we had increased LDD sales of 7 and increased LAL sales of 7,361 when compared to the quarter ended March 31, 2024 from strong adoption of our RxSight technology by practices and doctors combined with an increased LDD installed base.

Previous wording

Our quarterly and annual financial results may fluctuate as a result of a variety of factors many of which are outside our control. We may not yet be able to accurately assess seasonality and other trends, and we will continue to evaluate our business in the future using these and other financial metrics as we observe trends in our business.

Current wording

Our quarterly and annual financial results may fluctuate as a result of a variety of factors many of which are outside our control. We may be affected by other seasonal trends in the future, including severe weather (which can impact the number of elective procedures performed), particularly as our business matures. We may not yet be able to accurately assess seasonality and other trends, and we will continue to evaluate our business in the future using these and other financial metrics as we observe trends in our business. To the extent we experience this seasonality, it may cause fluctuations in our operating results and financial metrics and make forecasting our future operating results and financial metrics more difficult.

Previous wording

For the three and nine months ended September 30, 2024 and 2023, revenue from contracts with customers consisted of the following (in thousands):

Current wording

For the three months ended March 31, 2025 and 2024, revenue from contracts with customers consisted of the following (in thousands):

Previous wording

For the three and nine months ended September 30, 2024 and 2023 we did not have any one customer who individually accounted for more than 10% of revenue.

Current wording

For the three months ended March 31, 2025 and 2024 we did not have any one customer who individually accounted for more than 10% of revenue.

Previous wording

Cost of sales consist of materials, labor and manufacturing overhead internally to produce our products as well as the cost of shipping and handling. Overhead costs include the cost of quality assurance, material procurement, inventory control, facilities, equipment and operations supervision and management and stock-based compensation. Cost of sales also includes depreciation expense for production equipment and certain direct costs such as shipping costs and royalty and license fee expense. Shipping costs billed to customers are included in sales. We expect cost of sales to increase in absolute dollars as our revenue grows and more of our products are sold.

Current wording

Cost of sales consist of materials, labor and manufacturing overhead internally to produce our products as well as the cost of shipping and handling. Overhead costs include the cost of quality assurance, material procurement, inventory control, facilities, equipment and operations management and stock-based compensation. Cost of sales also includes depreciation expense for production equipment and certain direct costs such as shipping costs and royalty and license fee expense. Shipping costs billed to customers are included in sales. We expect cost of sales to increase in absolute dollars as our revenue grows and more of our products are sold.

Previous wording

We calculate gross margin as gross profit/(loss) divided by sales. Our gross margin has been and will continue to be affected by a variety of factors, including average selling prices, product sales mix, production and ordering volumes, manufacturing costs, product yields, headcount and cost-reduction strategies. Our gross margin could fluctuate from quarter to quarter as we introduce new products, and as we adopt new manufacturing processes and technologies.

Current wording

We calculate gross margin as gross profit divided by sales. Our gross margin has been and will continue to be affected by a variety of factors, including average selling prices, product sales mix, production and ordering volumes, manufacturing costs, product yields, headcount and cost-reduction strategies. Our gross margin could fluctuate from quarter to quarter as we introduce new products, and as we adopt new manufacturing processes and technologies.

Previous wording

Our LDD, as is typical of many medical device capital equipment products, has a low gross margin, as the material cost of the LDD is significant, representing greater than 50% of the total cost to manufacture. In addition, we do not mark up our LDD substantially because LDDs, once sold, generate LAL procedures. Our LAL gross margin is higher, with low material cost but high fixed overhead costs. As our manufacturing volume of the LAL increases, we expect gross margin may improve significantly.

Current wording

Our LDD, as is typical of many medical device capital equipment products, has a low gross margin, as the material cost of the LDD is a significant portion of the total cost to manufacture. In addition, we do not mark up our LDD substantially because LDDs, once sold, can generate LAL procedures. Our LAL gross margin is higher, with low material cost but high fixed overhead costs. As our manufacturing volume of the LAL increases, we expect gross margin may improve significantly.

Previous wording

Interest expense consists primarily of interest incurred on our outstanding indebtedness and non-cash interest related to the amortization of debt discount and issuance costs associated with our indebtedness and interest on leases.

Current wording

Interest expense consists primarily of interest incurred on leases.

Previous wording

Sales increased by $13.1 million, or 59.1%, to $35.4 million for the three months ended September 30, 2024, from $22.2 million for the three months ended September 30, 2023. The increase in total sales was primarily due to the incremental sales of 10,897 LALs and 12 LDDs from strong adoption of our RxSight system by practices and doctors.

Current wording

Sales increased by $8.4 million, or 28.4%, to $37.9 million for the three months ended March 31, 2025, from $29.5 million for the three months ended March 31, 2024. The increase in total sales was primarily due to the incremental sales of 7,361 LALs and 7 LDDs from increased adoption of our RxSight system by practices and doctors.

Previous wording

Cost of sales increased by $1.6 million, or 19.2%, to $10.1 million for the three months ended September 30, 2024, from $8.5 million for the three months ended September 30, 2023, primarily due to the increase in the number of LALs and LDDs sold during the period. Gross margin increased to 71.4% in the three months ended September 30, 2024, from 61.8% for the three months ended September 30, 2023, primarily due to improved operating leverage, favorable product mix from a greater percentage of revenue from LAL sales, and increased margins on our LDD due to lower material costs.

Current wording

Cost of sales increased by $0.7 million, or 8.4%, to $9.5 million for the three months ended March 31, 2025, from $8.8 million for the three months ended March 31, 2024, primarily due to the increase in the number of LALs and LDDs sold during the period. Gross margin increased to 74.8% in the three months ended March 31, 2025, from 70.1% for the three months ended March 31, 2024, primarily due to improved operating leverage, favorable product mix from a greater percentage of revenue from LAL sales, and increased margins on our LDD due to lower material costs.

Previous wording

SG&A expenses increased by $6.5 million, or 33.8%, to $25.6 million for the three months ended September 30, 2024, from $19.1 million for the three months ended September 30, 2023. This increase was primarily attributable to an increase in selling and marketing costs of $5.1 million (mainly due to increased salaries from increased headcount of 36), increased sales commissions, incentive bonuses and employee benefits of $2.7 million, $0.9 million of increased stock-based compensation expense, $0.8 million primarily due to additional post market study, in each case when compared to the three months ended September 30, 2023. General and administrative expenses increased $1.3 million due to increased personnel expenses of $0.8 million, and increased stock-based compensation of $0.8 million partially offset by $0.5 million of lower audit and audit related expenses in each case when compared to the three months ended September 30, 2023.

Current wording

SG&A expenses increased by $5.3 million, or 22.8%, to $28.6 million for the three months ended March 31, 2025, from $23.3 million for the three months ended March 31, 2024. This increase was primarily attributable to an increase in selling and marketing costs of $4.7 million mainly due to $1.7 million from increased salaries from increased headcount of 51, $1.7 million due to additional post market study costs and $0.9 million of increased stock-based compensation expense, in each case when compared to the three months ended March 31, 2024. General and administrative expenses increased $0.6 million primarily due to increased stock-based compensation expenses of $0.6 million, when compared to the three months ended March 31, 2024.

Previous wording

Research and development expenses increased by $1.7 million, or 24.5%, to $8.8 million for the three months ended September 30, 2024, from $7.1 million for the three months ended September 30, 2023. This increase was primarily attributable to $1.0 million due to increased facility costs and $0.5 million from increased stock-based compensation and $0.6 million in increased personnel costs when compared to the three months ended September 30, 2023.

Current wording

Research and development expenses increased by $2.3 million, or 29.1%, to $10.4 million for the three months ended March 31, 2025, from $8.0 million for the three months ended March 31, 2024. This increase was primarily attributable to $1.4 million due to increased facility costs, $0.7 million from increased stock-based compensation and $0.9 million in increased personnel costs which were partially offset by $0.6 million in lower post-market study costs when compared to the three months ended March 31, 2024.

Previous wording

Other income (expense), net, increased $2.8 million to income of $2.9 million for the three months ended September 30, 2024, compared to income of $0.1 million for the three months ended September 30, 2023. The increase was primarily due to (i) increased interest income of $1.2 million, as compared to the prior year period, from higher interest rates earned on higher short term investment balances and (ii) lower loss on extinguishment of debt of $1.4 million due to the repayment of the Oxford term loan, as compared to the prior year period.

Current wording

Other income (expense), net, increased $0.9 million to income of $2.5 million for the three months ended March 31, 2025, compared to income of $1.5 million for the three months ended March 31, 2024. The increase was primarily due to increased interest income of $0.9 million from increased cash and short-term investment balances.

Previous wording

As of September 30, 2024, we had cash, cash equivalents and short-term investments of $237.1 million. For the nine months ended September 30, 2024, and 2023, our loss from operations were $28.2 million and $39.2 million, respectively. We had an accumulated deficit of $616.2 million as of September 30, 2024.

Current wording

As of March 31, 2025, we had cash, cash equivalents and short-term investments of $229.3 million. Our losses from operations were $10.7 million for the three months ended March 31, 2025, and March 31, 2024, respectively. We had an accumulated deficit of $630.3 million as of March 31, 2025.

Previous wording

We believe that our current cash, cash equivalents and short-term investments through the date of filing of this report will be sufficient to fund our operations for at least the next 12 months. Although, based on our current planned operations, we do not anticipate the need to raise additional capital or incur additional debt in order to reach profit from operations, as the same may be disclosed in the Company’s future Annual Reports on Form 10-K or Quarterly Reports on Form 10-Q filed with the SEC, we may be required to raise additional capital through public or private equity offerings or debt financings, credit or loan facilities or by entering into partnerships or a combination of one or more of these funding sources in order to meet our liquidity requirements. We may also opportunistically raise capital under advantageous circumstances from time to time, such as the Public Offering, in order to support the expansion of our sales and operations in the U.S. and internationally and to pursue other business opportunities. If we determine that we need to raise additional funds, which may not be available to us when needed or on terms that we deem to be favorable. To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interests of our stockholders will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of common stockholders. Debt financing and preferred equity financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making acquisitions or capital expenditures or declaring dividends. If we are unable to maintain sufficient financial resources, our business, financial condition and results of operations will be materially and adversely affected, including potentially requiring us to delay, limit, reduce or terminate certain of our product discovery and development activities or future commercialization efforts. If we raise additional funds by issuing equity securities, our stockholders may experience dilution.

Current wording

We believe that our current cash, cash equivalents and short-term investments through the date of filing of this report will be sufficient to fund our operations for at least the next 12 months. Although, based on our current planned operations, we do not anticipate the need to raise additional capital or incur additional debt in order to reach profit from operations, as the same may be disclosed in the Company’s future Annual Reports on Form 10-K or Quarterly Reports on Form 10-Q filed with the SEC, we may be required to raise additional capital through public or private equity offerings or debt financings, credit or loan facilities or by entering into partnerships or a combination of one or more of these funding sources in order to meet our liquidity requirements. If we determine that we need to raise additional funds, which may not be available to us when needed or on terms that we deem to be favorable. To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interests of our stockholders will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of common stockholders. Debt financing and preferred equity financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making acquisitions or capital expenditures or declaring dividends. If we are unable to maintain sufficient financial resources, our business, financial condition and results of operations will be materially and adversely affected, including potentially requiring us to delay, limit, reduce or terminate certain of our product discovery and development activities or future commercialization efforts. If we raise additional funds by issuing equity securities, our stockholders may experience dilution.

Previous wording

Net cash used in operating activities for the nine months ended September 30, 2023, was $33.3 million, consisting primarily of a net loss of $39.4 million and a change in operating assets and liabilities of $5.9 million, partially offset by non-cash stock-based compensation of $11.3 million and depreciation and amortization of $3.0 million.

Current wording

Net cash used in operating activities for the three months ended March 31, 2025, was $8.8 million, consisting primarily of a net loss of $8.2 million and a change in operating assets and liabilities of $6.2 million and amortization of discount on short-term investments of $2.4 million, partially offset by non-cash stock-based compensation of $7.1 million and depreciation and amortization of $0.8 million.

Previous wording

Net cash used in operating activities for the nine months ended September 30, 2024, was $12.7 million, consisting primarily of a net loss of $21.5 million and a change in operating assets and liabilities of $5.6 million, partially offset by non-cash stock-based compensation of $17.4 million and depreciation and amortization of $3.1 million.

Current wording

Net cash used in operating activities for the three months ended March 31, 2024, was $9.3 million, consisting primarily of a net loss of $9.1 million and a change in operating assets and liabilities of $4.7 million, partially offset by non-cash stock-based compensation of $4.7 million and depreciation and amortization of $1.1 million.

Previous wording

Net cash used in investing activities for the nine months ended September 30, 2023, was $26.7 million, consisting of net maturities of short-term investments of $23.5 million and purchases of property and equipment of $3.2 million.

Current wording

Net cash provided by investing activities for the three months ended March 31, 2025, was $20.9 million, consisting of net maturities of short-term investments of $21.4 million, partially offset by purchases of property and equipment of $0.6 million.

Previous wording

Net cash used in investing activities for the nine months ended September 30, 2024, was $100.6 million, consisting of net purchases of short-term investments of $96.0 million and purchases of property and equipment of $4.6 million.

Current wording

Net cash provided by investing activities for the three months ended March 31, 2024, was $24.3 million, consisting of net maturities of short-term investments of $26.2 million, partially offset by purchases of property and equipment of $2.0 million.

Previous wording

Net cash provided by financing activities for the nine months ended September 30, 2024, was $120.3 million consisting primarily of proceeds from issuances of common stock from the Public Offering of $108.1 million and, proceeds from issuance of common stock from stock option exercises of $17.8 million, partially offset by tax payments for employee stock compensation of $4.8 million.

Current wording

Net cash provided by financing activities for the three months ended March 31, 2024, was $8.0 million consisting primarily of proceeds from issuances of common stock of $10.2 million partially offset by payments for employee taxes related to stock compensation of $2.1 million.

Previous wording

We rely on third parties, including single and sole source suppliers, to manufacture certain components and subcomponents of our products and to provide raw materials, primarily chemicals for our LAL. We do not have long-term supply agreements with, or guaranteed commitments from our suppliers, including single and sole source suppliers. We utilize purchase orders or blanket orders covering the medium term of 18–24 months for the majority of our supplier base. While we depend on our suppliers to provide us and our customers with materials in a timely manner that meet our and their quality, quantity and cost requirements, vendors will miss delivery dates, extend delivery dates or in some circumstances cancel purchase orders because these suppliers may encounter problems during manufacturing for a variety of reasons, any of which could delay or impede their ability to meet our demand. The expansion of global lead times has resulted in the lack of availability of raw materials, including semiconductors, computers, monitors electronic parts, metals, packaging, adhesives, chemicals, resins and subcontract painted components. Certain suppliers have passed on higher prices, surcharges and expedited shipping fees to defray the higher commodity prices they are paying due to short supply and pushed out delivery dates. Additionally, we identify and qualify new suppliers to mitigate risk due to single and sole source suppliers and to alleviate supply chain constraints we will identify and qualify new vendors or substitute components which requires testing, validations and documentation adding to internal costs and diverting engineering resources from other projects. While we have taken measures to mitigate business continuity risk, including increasing standard lead times, payment of expedite fees, issuance of a limited number of non-cancelable purchase orders, advance delivery of critical components ahead of normal delivery dates and second sourcing, our suppliers may cease producing the components we purchase from them or otherwise decide to cease doing business with us. Any supply interruption from our suppliers or failure to obtain additional suppliers for any of the components or subcomponents used in our products would limit our ability to manufacture our current and new products and could have a material adverse effect on our business, financial condition and results of operations.

Current wording

We rely on third parties, including single and sole source suppliers, to manufacture certain components and subcomponents of our products and to provide raw materials, primarily chemicals for our LAL. We do not have long-term supply agreements with, or guaranteed commitments from our suppliers, including single and sole source suppliers. We utilize purchase orders or blanket orders covering the medium term of 18–24 months for the majority of our supplier base. While we depend on our suppliers to provide us and our customers with materials in a timely manner that meet our and their quality, quantity and cost requirements, vendors will miss delivery dates, extend delivery dates or in some circumstances cancel purchase orders because these suppliers may encounter problems during manufacturing for a variety of reasons, any of which could delay or impede their ability to meet our demand. The expansion of global lead times has resulted in the lack of availability of raw materials, including semiconductors, computers, monitors electronic parts, metals, packaging, adhesives, chemicals, resins and subcontract painted components. Certain suppliers have passed on higher prices, surcharges and expedited shipping fees to defray the higher commodity prices they are paying due to short supply and pushed out delivery dates.