Shares declined 1.2% as investors digested softness in the Systems and Services segment driven by lower scanner ASPs and cautious commentary about near-term revenue headwinds from new lower-cost scanner purchasing options, despite stable Clear Aligner volumes and better-than-expected margins.
- Clear Aligner revenue grew 8.2% year-over-year, with volume reaching a record 692,000 cases, up 7.4%, supporting ongoing global adoption across multiple customer channels and regions.
- Non-GAAP operating margin improved to 22.9%, surpassing internal expectations, helped by mix and efficiency in Clear Aligners.
- Systems and Services revenue declined 11% year-over-year to $185.3 million due to price pressure from a shift to lower-priced scanners and flexible acquisition models, including leasing and rental options.
- While scanner unit placements and active installed base grew double digits, rental and lease programs are creating near-term revenue and profitability headwinds.
- Management underscored the intentional strategic shift to expand longer-term recurring revenue and platform adoption at the cost of short-term sales pressure in capital equipment.
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