Shoulder Innovations Q2 Earnings Call Highlights

Revenue and outlook increased: Second-quarter revenue rose 56% year over year to $17.2 million, prompting Shoulder Innovations to raise its 2026 revenue guidance to $67 million–$69 million. Growth was driven by surgeon adoption: Implant volume increased approximately 50% to 2,238 units, with gains across all territories and most growth attributed to share wins from larger competitors. Margins and losses improved while investment continued: Gross margin expanded to 78.3%, and net loss narrowed to $10.2 million. The company is continuing to invest in robotics, software and new implants, including plans to submit its InSet NEO robotic platform to the FDA in the first half of 2027.

Shoulder Innovations NYSE: SI reported second-quarter net revenue of $17.2 million, up 56% from $11 million a year earlier, as the company added surgeons, expanded use among existing customers and advanced several product launches. The company raised its full-year 2026 revenue outlook to $67 million to $69 million, from a prior range of $65 million to $68 million. Chief Executive Officer Rob Ball said the updated guidance represents growth of 42% to 46% over 2025. Management said the outlook incorporates typical orthopedic seasonality, including lower sequential procedure volumes in the third quarter and a second-half mix shift that can affect average selling prices.

Surgeon Adds and Procedure Volume Drive Growth Ball said Shoulder Innovations added more new customers in the second quarter than it did in the first quarter, following a first-quarter pace of additions that was more than double the prior-year rate. The company’s commercial organization targets approximately 1,800 high-volume U.S. surgeon specialists. Total implant volume among the company’s core, contender and prospect customers increased about 50% year over year to 2,238 units in the second quarter. Ball said most of that growth came from core surgeons, both in the number of physicians using the company’s products and the number of procedures those surgeons performed. Every company territory grew year over year during the quarter, with a majority posting growth above 80%, according to Ball. Shoulder Innovations also expanded its commercial presence at two hospital systems, gaining full access at both centers. The company held more than 90 surgeon engagement events year to date, reaching hundreds of surgeons. Ball said the company’s April national symposium in Napa was its largest event to date by surgeon attendance and was followed by increased procedure volumes among attendees. During the question-and-answer session, Ball said the company believes a “vast majority” of its growth is coming from share gains against larger incumbent competitors, though it is also capturing some market growth as it expands its presence in centers with fellowship programs.

Margins Improve While Product Investment Continues Second-quarter gross margin rose to 78.3%, compared with 76.2% a year earlier. Chief Financial Officer Jeff Points attributed the improvement to strong average selling prices and negotiated cost-reduction programs across product lines. Selling, general and administrative expense increased to $20.1 million from $12.8 million in the prior-year quarter, driven primarily by commercial headcount additions, higher variable selling expense and public-company costs. Points said that excluding public-company costs, the company generated operating leverage in SG&A compared with the prior year. Research and development expense inc...