PROCEPT BioRobotics (PRCT) Status Update summary

Hydros system launch and product innovation

• Hydros, a next-generation robotic system with integrated AI, received FDA 510(k) clearance and is designed for mass-market adoption, featuring advanced imaging, a digital cystoscope, and a streamlined workflow for improved efficiency and usability.

• The FirstAssist AI feature assists surgeons in identifying anatomical landmarks and treatment planning, improving accuracy across experience levels, and the handpiece now comes preassembled with a single-use digital scope, streamlining setup and eliminating reprocessing.

• Hydros leverages insights from over 50,000 procedures and is the only AI-powered platform delivering Aquablation therapy, enabling personalized, precise, and controlled prostate tissue resection while preserving sexual and urinary function.

• Aquablation therapy is supported by two 5-year clinical trials showing durable symptom relief and preservation of function across all prostate sizes.

• The system is built as a platform for future software and hardware upgrades, with initial focus on BPH and potential expansion into cancer indications.

Commercial strategy and market transition

• Hydros will be immediately available in the US, with a transition strategy to convert existing AquaBeam pipeline deals to Hydros purchases; Q3 will see a mix of both systems, and full market release is planned within the current quarter.

• Sales team training on Hydros may temporarily impact procedure volumes in late Q3 and early Q4, but is considered essential for long-term success.

• The company is prioritizing greenfield opportunities for Hydros in 2024, with replacement cycles for existing customers expected to begin in 2025.

• Over 400 robotic systems are now installed across the United States, reflecting strong commercial momentum.

• International expansion will follow US rollout, with regulatory processes underway in other regions.

Financial guidance and outlook

• Full-year 2024 guidance is reaffirmed: 33,350 handpieces and approximately 185 US systems, with Q3 system sales expected in the low forties and Q4 as the strongest quarter.

• Average selling price (ASP) guidance for systems remains at $380,000 for the second half of 2024, with expectations for higher Hydros pricing in the long term.

• Handpiece ASP guidance for H2 2024 is $3,200, with Hydros handpieces expected to command a premium over time.

• No material difference in manufacturing cost between Hydros and the first-generation system; gross margin expansion is expected to continue.

• Forward-looking statements include expectations for financial performance, market opportunity, and commercial expansion, subject to risks and uncertainties as detailed in SEC filings.