Q1 2024 Masimo Corp Earnings Call Transcript
Key Points
- Masimo Corp (MASI) reported healthcare revenues of $340 million, at the high end of their guidance range, driven by strong sensor orders in the U.S. and Europe.
- Record contracting with hospital customers, achieving over $100 million in true incremental contract value in Q1, indicating continued market share gains.
- Successful relocation of manufacturing to Malaysia from Mexico, improving gross margins significantly.
- Increased guidance for healthcare revenues and non-GAAP EPS based on positive Q1 results and a more optimistic outlook for hospital census in 2024.
- Strong cash flow generation in Q1, with $46 million in operating cash helping to pay down $28 million of debt.
- Healthcare revenues showed a 2% decline year-over-year, although this was within the challenging comparison period.
- Non-healthcare revenues declined by 29% on a constant currency basis year-over-year, reflecting ongoing macroeconomic challenges impacting consumer spending.
- The potential separation of the consumer business adds uncertainty, with the structure, timing, and terms still under consideration.
- A decline in rainbow consumable revenues by 11% due to timing of shipments outside the U.S.
- Despite improvements, the non-healthcare gross margin remains low at 29%, indicating ongoing challenges in achieving profitability in this segment.
Good afternoon, ladies and gentlemen, and welcome to Masimo's First Quarter 2024 Earnings Conference Call. The company's press release is available at www.masimo.com. (Operator Instructions)
I'm pleased to introduce Eli Kammerman, Masimo's Vice President of Business Development and Investor Relations. Please go ahead.
Hello, everyone. Joining me today are Chairman and CEO, Joe Kiani; and Executive Vice President and Chief Financial Officer, Micah Young. This call will contain forward-looking statements, which reflect management's current judgment including certain of our expectations regarding fiscal year 2024 financial performance. However, they are subject to risks and uncertainties that could cause actual results to differ materially.
Risk factors that could cause our actual results to differ materially from our projections and forecasts are discussed in detail in our periodic filings with the SEC. You will
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