スキンヘルス・システムズ（SKIN）2026年第3四半期決算説明会：消耗品の成長とEBITDAガイダンス引き上げ

主なポイント

• 2026年度第3四半期の売上高は前年同期比2.1%減の6,920万ドルとなり、経営陣が示したガイダンスレンジ（6,500万〜7,000万ドル）の上限付近となった。減収率は第2四半期の7.8%減、第1四半期の6.7%減から縮小した。
• 消耗品売上高は1.2%増の5,040万ドルと増収に転じ、総売上高の約73%を占めた。デリバリーシステム売上高は9.9%減の1,880万ドルとなった。
• GAAPベースの売上総利益率は前年同期の64.6%から68.2%に改善した。調整後売上総利益率は、関税還付による約100万ドルの一時的な押し上げ効果を含め、380ベーシスポイント上昇して71.8%となった。
• 調整後EBITDAは約50%増の1,340万ドルとなり、売上高利益率は19.3%に達した。また、SkinHealth Systemsは2四半期連続でGAAPベースの営業黒字を計上した。
• 同社は通期の調整後EBITDAガイダンスを従来の3,900万〜4,600万ドルから4,800万〜5,000万ドルへ引き上げた。売上高ガイダンスは2億8,100万〜2億8,700万ドルへとレンジが絞り込まれた。
• 機器販売とEMEA地域が引き続き主な下押し要因となった。経営陣はこれに対し、リーダーシップの刷新、米国でのレンタルプログラム導入、大口法人顧客への対応強化、新製品への投資などで対応を進めている。

主要財務データ

調整後売上総利益率の改善は、前年同期にあったElite下取り費用の剥落、在庫管理の改善、余剰・滞留在庫評価損の減少、および消耗品構成比の上昇を反映したものである。一時的な関税還付による寄与は約140ベーシスポイントであった。

GAAPベースの営業費用は前年同期の5,190万ドルから約4,220万ドルに減少した。調整後営業費用は、APAC地域における市場展開（GTM）体制の見直しや、専門家報酬・手数料の減少に支えられ、3,910万ドルから約3,630万ドルに減少した。

事業および営業実績の動向

米州地域の売上高は前年同期比1.4%増の4,890万ドルとなり、消耗品は4.3%増となった。経営陣は消耗品の改善要因として、主力（シグネチャー）製品の好調、HydraScalpの再投入、営業活動の着実な実行、および非医療チャネルからの需要を挙げた。

EMEA地域の売上高は前年同期比11.7%減の1,420万ドルとなった。デリバリーシステムが最大の押し下げ要因となり、消耗品も6.6%減少した。経営陣は特にドイツにおける営業実行力の不足を指摘し、同地域のリーダーシップ強化と組織再編を実施したと説明した。減収率は第2四半期の19%減から改善した。

APAC地域の売上高は4.2%減の610万ドルとなった。これは主として、オーストラリアおよびニュージーランドにおける販売代理店（ディストリビューター）モデルへの移行によるものである。

SkinHealth Systemsは当四半期、要件を満たすプロバイダーの初期設備投資負担を軽減するため、米国でレンタルプログラムを導入した。同社は機器を提携ファイナンス会社に売却し、売上を一括計上する。提携先がプログラムの運営を担いデフォルト（債務不履行）リスクを引き受けるため、これらの取引の売上総利益率はやや低くなると経営陣は述べている。

同社はまた、導入済みのHydrafacialの稼働率向上も目指している。最近投入した製品には、角質吸引前用ピーリングの「HydraGlow」、バイオセルロースマスクの「Hydralock HA」、ブースターの「HydraClear」などがある。経営陣によると、一連のHydraClear施術の臨床評価において、肌トラブル全体の平均38%の減少が示された。

「SkinStylus」の消耗品は前年同期比で39%増加した。同社は最近、SkinStylusの展開を欧州6市場に拡大し、2027年に予定されている別の補完的機器の投入に向けて開発を進めている。次世代Hydrafacialプラットフォームの投入目標は引き続き2028年としている。

経営陣のガイダンス

経営陣は、機器の売上構成比が高まる見通しであることや関税還付が一巡することから、第4四半期の調整後売上総利益率は前四半期比で低下すると予想している。

営業費用も第3四半期から増加する見通しである。同社によると、第3四半期に予定されていた支出のうち約130万ドルが第4四半期にずれ込んだとしており、その内訳は約60万ドルのマーケティング費用、約60万ドルの研究開発費、約10万ドルの一般管理費である。

2027年および2028年の機器プログラム、臨床試験、その他のイノベーションプロジェクトが進展するにつれ、研究開発費は大幅に増加する見込みである。なお、経営陣は2027年度の財務ガイダンスを提示しなかった。

リスクおよび注視事項

• 資本コストの上昇、販売サイクルの長期化、競争激化によりプロバイダーの購入判断が先送りされており、機器需要は引き続き下押し圧力を受けている。
• EMEA地域の業績は前四半期比で改善したものの依然として低調であり、特にドイツにおける営業実行力が課題として指摘されている。
• システム1台あたりの消耗品売上高は前年同期の水準を下回ったままであり、導入済みシステムの稼働生産性に引き続き圧力がかかっていることを示唆している。
• 第3四半期の収益性は一時的な関税還付と費用計上時期のズレによる恩恵を受けており、これらはいずれも前四半期比較に影響を与える。
• レンタルプログラムはまだ初期段階にあり、経営陣はリード（見込み顧客）の質、成約率、プロバイダーへの普及状況、施術の実施頻度を検証している。
• 約2億5,000万ドルの転換社債残高があり、2028年第4四半期に満期を迎える。経営陣は2027年に対処を開始し、利用可能な選択肢を検討する方針である。

アナリスト質疑応答の要点

経営陣によると、営業担当者の再教育、顧客セグメンテーション、訴求メッセージの刷新、HydraScalpの再投入が施術の活性化を支え、米国の消耗品トレンドは改善している。また同社は、米州における機器離脱の減少と休眠顧客の利用再開を主因に、ネットチャーン（純増減）がプラス59台となったことも報告した。

消費者需要について経営陣は、消費者は施術結果に関心を持ち続けているものの、支出がより多様な施術やプロバイダーに分散していると述べた。米州におけるシステム1台あたりの売上高は依然として下押し圧力を受けているが、第3四半期の減少率は1%未満に縮小した。

経営陣は、法人および多店舗展開アカウントについて、機器の導入台数、プロバイダーのカバレッジ、継続的な施術における潜在的な規模拡大の源泉であると説明した。同社は人的関係に依存した営業アプローチから、より体系的な需要喚起、価値提案型営業、パイプライン管理へと移行を進めている。

製品開発に関して経営陣は、2027年に予定されている機器はHydrafacialシステムではないことを改めて強調した。2028年を目標とする次世代Hydrafacialプラットフォームは、臨床結果、プロバイダーのワークフロー、施術体験の向上を目的としているが、同社の短期的な業績回復計画には含まれていない。

決算説明会のトランスクリプト全文

決算説明会の完全なトランスクリプト

経営陣による説明

Operator

This call is being recorded on Thursday, November 5, 2026. I would now like to turn the conference over to Norberto Aja, Investor Relations. Thank you.

Norberto Aja

Thank you, operator, and good afternoon, everyone. Thank you for joining SkinHealth Systems' third quarter 2026 conference. We released our results earlier this afternoon, which can be found on our corporate website at skinhealthsystems.com. Joining me on the call today is SkinHealth Systems President and Chief Executive Officer Pedro Malo, along with our Chief Financial Officer, Mike Monahan.

Before we begin, I want to remind everyone of the company's safe harbor language. Management may make forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including guidance and underlying assumptions. Forward-looking statements are based on current expectations and beliefs and involve risks and uncertainties that could cause actual results to differ materially.

Listeners are cautioned not to place undue reliance on any forward-looking statements. For further discussion of risks related to our business, please refer to the Risk Factors contained in the company's filings with the Securities and Exchange Commission. In addition, this call will present non-GAAP financial measures. Management uses adjusted EBITDA and other non-GAAP measures as supplemental measures to evaluate operating performance and to facilitate period-to-period comparisons. These non-GAAP measures should be considered in addition to and not as a substitute for financial information prepared in accordance with GAAP.

A reconciliation of these non-GAAP financial measures to the most comparable GAAP measure is available in the earnings press release, which was furnished to the SEC, as well as available on our website. Following management's prepared remarks, we will open the call for a question-and-answer session. With that, I would now like to turn the call over to our President and CEO, Pedro Malo. Please go ahead, Pedro.

Pedro Malha

Thank you, Norberto, and good afternoon, everybody. Let me start with a central message from this quarter. We are making progress on the things that matter the most: the Hydrafacial business and improving the economics of the company. At the same time, we are developing new opportunities for growth. To be clear, the work isn't done. Equipment sales remain challenging, particularly in EMEA. Utilization in our installed base is still below where it should be, but we are making good progress against our plan, and the third quarter results provide tangible evidence that we are operating from a stronger foundation than 1 year ago.

Our third quarter revenue was $69.2 million, towards the upper end of our $65 million to $70 million guidance range, meaning that our quarterly revenue declined 2.1% year-over-year, which is a meaningful improvement from the declines of 7.8% in the second quarter and 6.7% in the first quarter. Importantly, global consumables returned to growth, up 1.2% on a year-over-year comparison. Equipment remained the primary headwind, but the rate of the overall revenue decline has moderated significantly. At the same time, the earnings profile of the business continues to improve.

On a GAAP basis, gross margin was 68.2%, operating income was approximately $5 million, and net loss was approximately $1 million. We delivered positive GAAP operating income for the second consecutive quarter, and adjusted gross margin was 71.8%, our third consecutive quarter above 70%. Adjusted EBITDA was $13.4 million. Some of our quarterly bottom-line outperformance benefited from 1-time items and expense timing, but we are also seeing the benefits of better margins, tighter cost management, and a more efficient operating model. The priority now is to sustain those improvements while returning revenue to growth.

Looking across our regions, we are seeing encouraging signs in the Americas, which grew 1.4%, with consumables growing 4.3% on a year-over-year comparison. EMEA remained challenging with revenues down approximately 12% on a year-over-year comparison, reflecting pressure in delivery systems, particularly in Germany, where execution has been below expectations. To address this, we have strengthened regional leadership, and we are taking actions to improve field execution and customer engagement. In APAC, revenue declined approximately 4% on a year-over-year comparison, primarily reflecting the transition in Australia and New Zealand to a distributor model. So while our performance varies across markets, we know where the pressure is, and we are taking actions to address it.

Let me turn now to our 3 strategic priorities and the progress we are making in building a stronger, more sustainable growth business. Our first priority is strengthening the core Hydrafacial franchise. We have a fantastic global brand and deep customer relationships, but we need to translate those advantages into better commercial execution. So over the past year, we reorganized our commercial teams, strengthened accountability, and invested in better training, processes, and selling tools. We are also taking a more targeted approach to customers, with a greater emphasis on Hydrafacial clinical differentiation and the economic value it creates for providers. Additionally, we are expanding our relationships with corporate and multi-location accounts, where we see opportunities to broaden our installed base and increase treatment volumes.

During the quarter, we introduced a U.S. rental program to address 1 of the key barriers to equipment adoption: upfront capital investment. It's still early, but the objective is to make Hydrafacial more accessible, bringing more providers into the Hydrafacial ecosystem and supporting long-term relationships with them. We are also advancing our next-generation Hydrafacial platform, currently targeted for 2028, with the goal of improving clinical outcomes, provider workflow, and overall treatment experience. On competition, we haven't seen a meaningful change in intensity from what we discussed last quarter. Our strategy isn't simply to compete on price; it's to strengthen our differentiation, improve commercial execution, and deliver greater value to our providers.

Our second strategic priority is getting more value from the Hydrafacial installed base. Throughout the years, we have built a substantial global network of providers, and that represents 1 of our biggest competitive advantages. But placing a system is only the beginning of the customer relationship. The real opportunity lies in helping providers perform more treatments, increase utilization, and generate more recurring consumables revenue. We saw encouraging progress in the quarter, with global consumables growing 1.2% on a year-over-year comparison, and Americas consumables returning to growth for the first time this year, supported by strong signature consumables performance, plus a Hydrafacial relaunch and other commercial initiatives.

But consumables revenue per system remained below last year, and we believe we can do more to improve productivity across the installed base. That's an important part of our innovation strategy: bringing providers clinically differentiated treatments that address real consumer needs and create more reasons for consumers to come back. So in September, we introduced our treatment enhancers: the HydraGlow pre-extraction peel and the Hydralock HA biocellulose mask. In October, we launched a new booster, HydraClear, for blemish-prone skin, which in clinical evaluation showed that a series of HydraClear treatments produced a 38% mean reduction in total blemishes.

So these launches are a good example of the direction we're taking with innovation: more targeted, clinically supported products that address specific customer needs. Our HydraScalp relaunch is another good example of how we are working to expand how providers can use their existing Hydrafacial system in the scalp and in hair health. Equally important is our work in helping providers turn this innovation into greater treatment volumes, and we are doing this with education programs like Hydrafacial Impact, which was built to help providers attract more customers, increase repeat visits, and improve their treatment economics.

The point isn't simply to launch more products; it's to make the systems already in the market more productive. If we execute well, we can create a meaningful recurring revenue opportunity without relying entirely on new equipment placements. Our third strategic priority is to build a broader skin health business. Our ambition is not to be limited to 1 product or 1 category. We want to participate in attractive, high-growth segments of the aesthetics market, offer providers complementary treatments, and give consumers more reasons to engage with our brands.

SkinStylus is a good example of that strategy in play. Microneedling is an attractive and growing segment that complements Hydrafacial, and SkinStylus gives us a strong platform to compete in that market, offering both microneedling and nano-channeling treatments. SkinStylus consumables grew 39% year-over-year this quarter, and very recently, we expanded SkinStylus into 6 key European markets, leveraging our existing international commercial infrastructure. We are also making good progress towards a planned introduction of another complementary device in 2027, with more details to come.

What's important strategically is that we believe we already have the customer relationships, the commercial infrastructure, and the clinical credibility, so we can leverage those advantages across a broader portfolio. That's how we can build a stronger company, not by moving away from what made it successful, but by building on it. So let me bring all of this together. The revenue decline has narrowed significantly. Overall, consumables have returned to growth, margins are substantially stronger, and we're making progress on the commercial and innovation initiatives that can drive the next phase of our business. We still have work to do on equipment sales, utilization, and EMEA.

When I look at SkinHealth Systems, I see a much bigger opportunity than the one we are capturing today. We have a strong global brand, a substantial installed base, a more efficient operating model, and an expanding portfolio. Our job now is to turn those advantages into sustainable growth through better execution in the core business, greater productivity from our installed base, and a disciplined expansion into new categories. That is exactly what we are focusing on delivering. With that, I'll turn the call over to Mike.

Michael Monahan

Thank you, Pedro. We are pleased with our company's performance this quarter. Our cross-functional teams were able to deliver on our revenue commitments, and we overperformed on driving adjusted EBITDA. The team was able to do this while continuing to invest in future growth initiatives. We're grateful for the hard work that everyone in this organization put into delivering. Thank you to the team.

Total net sales in the third quarter were $69.2 million, down 2.1% compared with the prior year. This was primarily driven by a decline in delivery system units sold year-over-year, partially offset by an increase in consumables revenue. Specifically, at the end of Q3, global active systems grew to [indiscernible]. We continue to grow our footprint and provider reach each quarter. Q3 delivery systems revenue was $18.8 million, down 9.9%. We placed 798 systems during the quarter compared with 875 in the prior year period, a decline of 8.8%. Average selling price was $23,509, down 1.2% year-over-year. Consumables revenue was $50.4 million, up 1.2% year-over-year, representing approximately 73% of total revenue.

On a year-over-year comparison, Americas net sales were $48.9 million, up 1.4%, with consumables up 4.3%, partially offset by continued pressure on equipment. EMEA net sales were $14.2 million, down 11.7%, with delivery systems the largest source of pressure, and consumables down 6.6%. APAC net sales were $6.1 million, down 4.2%, primarily reflecting the Australia and New Zealand distributor transition.

GAAP gross margin was 68.2% compared with 64.6% in the prior year period. Adjusted gross margin was 71.8% compared with 68% in Q3 2025, an improvement of approximately 380 basis points, and our third consecutive quarter above 70%. There were several drivers of the year-over-year improvement. First, the prior year period included higher costs associated with Elite trade-in systems that did not repeat. As a reminder, we sold through our fair market value Elite systems that were acquired prior to 2024, going through the same process. Going forward, this inventory is no longer on our balance sheet.

Second, we recorded approximately $1 million of tariff refunds during the quarter, which contributed approximately 140 basis points to adjusted gross margin. This was a 1-time benefit. Third, we continue to benefit from improved inventory management, including lower excess, obsolete, and scrap charges. And fourth, revenue mix benefited from a higher proportion of consumables as our consolidated consumables revenue reached 73% for the quarter. For the fourth quarter, we expect adjusted gross margin to moderate from third quarter levels as equipment becomes a larger percentage of the mix and the tariff benefit does not repeat.

GAAP operating expenses were approximately $42.2 million compared with $51.9 million in the prior year period. Adjusted operating expenses were approximately $36.3 million compared with $39.1 million. The year-over-year improvement reflects the benefit of our APAC go-to-market changes, lower professional fees, and lower commissions, partially offset by increased marketing and event spending. Approximately $1.3 million of planned third quarter expense also shifted into the fourth quarter: roughly $600,000 of marketing, $600,000 of research and development, and $100,000 of G&A.

As a result, we are projecting the fourth quarter run rate to be higher than the third quarter expense level. Research and development is expected to increase meaningfully in the fourth quarter as our device development programs, clinical studies, and other innovation initiatives advance. On a GAAP basis, income from operations was approximately $5 million compared with an operating loss of $6.2 million in the prior year quarter. This is our second consecutive quarter of positive GAAP operating income. Net loss was approximately $0.9 million. Adjusted EBITDA was $13.4 million, or 19.3% of revenue, compared with $8.9 million, or 12.6% in the prior year period, an increase of approximately 50%.

Cash flow from operations was approximately $11.3 million in the third quarter, and capital expenditures were approximately $1.1 million, resulting in free cash flow of approximately $10.2 million. On September 30, we repaid the remaining $103.2 million principal amount of our 1.25% convertible senior notes due in 2026. Together with approximately $645,000 of accrued and unpaid interest, the related indenture was satisfied and discharged. This completed the retirement of the 2026 notes and delivered on the plan we communicated earlier this year to address the maturity with cash on hand.

Following the repayment, we ended the quarter with approximately $112.4 million in cash and cash equivalents. We believe our liquidity position provides sufficient flexibility to operate and invest in the business. We have approximately $250 million in convertible debt remaining that matures in Q4 of 2028. We expect to address this in 2027 and will evaluate all alternatives thoughtfully as we move forward.

Turning to our outlook. Based on third quarter results and our current expectations for the balance of the year, we are updating our full year 2026 guidance. We now expect net sales of $281 million to $287 million compared with our previous guidance of $280 million to $290 million. We now expect adjusted EBITDA of $48 million to $50 million compared with our previous guidance of $39 million to $46 million.

Our fourth quarter assumptions reflect continued pressure on equipment and further work to improve the EMEA revenue performance. We expect adjusted gross margin to moderate sequentially as equipment represents a greater percentage of the mix and the 1-time tariff benefit does not repeat. Finally, the guidance reflects increased operating expenses quarter-over-quarter. This is primarily driven by increased sales and marketing expenses due to normal seasonal commission increases tied to revenue, along with some timing of marketing expenses that are now expected to impact the fourth quarter.

Research and development expenses are projected to increase meaningfully from the third quarter as a number of our 2027 and 2028 projects are beginning to ramp. Finally, we are projecting increased G&A expenses primarily due to increased professional fees, more normalized bad debt expense, and some timing of legal expenses. With that, I'll turn the call back to Pedro.

Pedro Malha

Thanks, Mike. Let me close with a few thoughts. We are not simply waiting for the equipment market to recover. We are taking action to build a stronger, more profitable business with multiple opportunities for growth. This quarter demonstrates that we are making progress. Revenue is stabilizing, consumables on an overall basis have returned to growth, and the economics of the business continue to improve.

At the same time, we are investing in the things that will drive our future: strengthening our Hydrafacial franchise, getting more value from our installed base, and building a broader portfolio of products and treatments. Like Mike mentioned, we also retired our near-term 2026 notes upon maturity as planned, while maintaining meaningful liquidity to continue investing in our business. So while there's still work ahead, we believe we are operating from a much stronger foundation than we were at the beginning of the year.

We also believe that we have the brand, the infrastructure, the relationships, and the innovation pipeline to build a substantially better and more diversified business. Our focus now is on execution: translating those advantages into consistent revenue growth, sustained profitability, and long-term value for our shareholders. Operator, you can now open the line for questions.

Operator

[Operator Instructions]

We have our first question from Olivia Tong with Raymond James.

質疑応答

Olivia Tong Cheang

First, can you talk about the growth in consumables? Do you think you've turned the corner and we can expect continued growth from here? Or was there anything particularly notable this quarter that doesn't repeat? And then what drove the growth? Was it more treatments, more boosters, pricing, or other factors there? And then secondly, can you give us a sense on the delivery—on the system side—what churn looks like? It's a bit difficult to assess now that you've got the leasing program in place, so would love to understand.

Pedro Malha

Thank you so much. Sure, Olivia. So on the consumables, let me bring you back. Global consumables increased 1.2% in this quarter, and actually the Americas consumables grew 4.3%—so good numbers. These are encouraging signals in terms of performance. To support that, the signature consumables are also performing better, and together with the HydraScalp relaunch, that basically added more treatments. So the Americas, specifically the U.S., is looking good.

This is the direct result of the execution work, the commercial work, the retraining of the sales force, the marketing resegmentation, remessaging—all that work is starting to pay off in the U.S. We feel also encouraged that in the quarter we launched HydraClear, a very promising booster, and also the non-medical channel is supporting that growth. So overall, I think things are starting to shape up on the consumable side, specifically in our most important market, which is the U.S. In terms of the system churn, Mike, do you want to take that one?

Michael Monahan

Sure, I'd love to. So we had positive net churn of 59 units if you roll it forward. This was primarily driven in the Americas, as we saw a lower falloff of devices and some consumers repurchasing that were previously dormant. So we're encouraged by some of the improvements that we've made, specifically around our outreach to past dormant accounts. We're seeing some of them come back.

Olivia Tong Cheang

Got it. Thank you.

Operator

We have our next question from Sydney Wagner with Jefferies.

Sydney Wagner

As wellness becomes a larger part of the med spa offering, are hair health concerns, including those associated just with GLP-1 use and the side effects from that, bringing new consumers to the ecosystem? And then if we think about HydraScalp and the opportunity there, are you primarily seeing deepened engagement with existing consumers or seeing incremental consumers coming in through that offering? And then just on EMEA, last quarter you cited personnel gaps and distributor order timing as temporary pressures, and they were expected to improve in the second half. So just curious how those issues are running now and what needs to change for that region to improve further? Thank you.

Pedro Malha

So in terms of scalp health, this is a segment that is getting a lot of attention and a lot of traction, independently of what's driving it. Obviously, GLP-1s could be a good contributor for that renewed interest in scalp health. HydraScalp for us, and HydraScalp with Keravive, is a particularly good example of the strategy that we put in place of getting more value out of our installed base. And basically, the whole premise of this is that we want to extend the use of our existing Hydrafacial system beyond just the facial treatments and going to the scalp and going to hair health, which, as I mentioned in the beginning, is getting some good traction as a segment overall in the market and getting a lot of growing consumer interest.

Basically, what is so appealing for us in terms of this treatment is that it offers and combines an in-office treatment with a home spray of peptides and basically creates another opportunity for providers. And we saw, and as I kept mentioning in the first answer to the first question, we saw this being a good contributor to the numbers of the consumables that we have seen in the U.S. in terms of the quarter. So now the opportunity is to expand that provider adoption of HydraScalp with Keravive and just build that recurring treatment volume on top of it.

In terms of EMEA, yes, definitely a point of pressure. It has been a point of pressure for our business for some quarters now. We have taken decisive action in terms of leadership and organization design to better address the needs and the dynamics of the EMEA market in the past quarter. I feel very encouraged and very positive with those changes and the tools and processes that we are bringing in place, and I feel optimistic that EMEA will start providing better results in the future.

Michael Monahan

The only thing I would add, Sydney, on the numbers: so we did see some improvement. Even though in EMEA we were down 19% year-over-year, as you might remember in Q2, that improved—still down, but down 11.7% in Q3. So to Pedro's point, even though the changes came throughout the summer, we're starting to see some improvement there.

Sydney Wagner

Great, thank you.

Operator

Our next question comes from Joe Federico with Stifel.

Joseph Federico

Maybe just to start a little high level, delivery systems in the quarter—placements were actually pretty impressive relative to our estimate. So I know it's now early days for the U.S. rental program, but maybe just any early learnings you're seeing from that program, and can you give us a bit of color on the economics of those placements from the system side?

Pedro Malha

Thanks. Yes, Joe, I appreciate the comment. So in terms of delivery systems, yes, the numbers were—I won't call it good, but they were less severe than they were in the last quarter. But definitely, and I can be straightforward with this, we're still below where we need to be. What we're seeing in the market is that capital decisions still remain a barrier, sales cycles are longer, and competition is there. And as I mentioned before, EMEA is the largest source of pressure that we have right now, but we are focused on making the product easier to access and the value proposition easier to sell.

I do believe that devices eventually will return to growth, but we have to improve conversion, bring more discipline to channel coverage, reduce adoption friction, and basically give customers and providers a compelling reason to invest. The rental program—and I will also add to this, the corporate account strategy that we have now in place—addresses today. The next-generation platform that is slated for 2028 will be the long-term innovation driver. So in terms of the U.S. rental program specifically, that program was introduced during the quarter, so it's still too early to attribute a meaningful share of Q3 performance to it.

But it was designed to remove the upfront capital hurdle for qualified providers. So the process that we are going through right now is that we are evaluating the lead quality, evaluating the conversion, evaluating the provider adoption, and importantly, the treatment activity after every placement. Our expectation is that this program will build contribution over time as it scales in the U.S. right now.

Michael Monahan

Joe, I would just add on the economics to follow up on that piece. The way the rental program works is our sales team is able to identify the sale, and if the end provider opts to enter into the rental program, we sell the unit to our financing partner who then administers the program. So for us, the revenue is booked upfront upon sale, very similarly to the way we do it when we go through our normal sale process. For the rental program, it has a slightly lower gross margin, as our financing partner captures some of the economics for administering the program and taking on the default risk. But net-net, it works in the same way as if we sell directly to the end provider.

Joseph Federico

Very helpful. I'll keep it to 1. Thanks for the color.

Operator

Our next question is from Navan Thai with BNP Paribas.

Navann Ty Dietschi

I don't know if you can comment, maybe some early thoughts on how growth and margins could trend next year with different factors like the expansion of corporate and multi-accounts, the rental program, and any other push and pull? Thank you.

Michael Monahan

Yes, I mean, we are not commenting on 2027, Navan, right now. What we can comment in terms of overall expectations is we're launching a number of initiatives next year. So my expectation—and we'll give more color when we get to our next call—is that as we start to roll out these initiatives during kind of the latter part of the first half of the year, you'll start to see the benefits, not just from some of the programs that we started investing in this year, but also from some of the new devices and partnerships Pedro had mentioned earlier that you'll see us start to announce as we get further into 2027.

Operator

Thank you. Our next question is from Jonah Kim with TD Cowen.

Unknown Speaker

First, just curiously, what are your key sales and marketing initiatives that you're implementing to drive better system sales going forward? Any color will be helpful there. And then just on the end consumer itself, how is the health of the consumer looking? Are you seeing any sort of delay in treatments just given where the macro backdrop is? Thank you.

Pedro Malha

Sure, Jonah. So in terms of the changes and the work that we're doing in terms of sales force excellence and corporate accounts within the commercial organization, we have strengthened the leadership and invested in more consistent training. The bigger change is basically moving from a relationship-led model to a more deliberate demand generation and conversion model. That includes better account segmentation, better value-based selling, very disciplined follow-up from the sales force down in the field, and very strong oversight from management over the health and the flow of the pipeline. All of that have been initiatives and a great focus of our commercial team and commercial leadership in the past quarter.

An example of programs that we drove in the quarter was Hydrafacial Impact. The concept of the thesis is that innovation only works when providers know how to sell it, basically, and know how to perform and bring customers back. So the Hydrafacial Impact program is really about helping our providers build better business, improving the treatment protocols, and improving the treatment economics. It's very straightforward: when providers are more successful with Hydrafacial, they perform more treatments, and utilization improves.

Another work that we've been doing—and a lot of organizational changes as well—is around corporate accounts. Here, we are taking a more targeted approach to this type of customer because they can provide scale. They can provide scale in placements, scale in provider coverage, and recurring treatments when implemented well. So a lot of work has been done in that organization, and we are very optimistic about the outcomes of that work.

Michael Monahan

The only thing I would add to that is we're seeing some encouraging signs in the Americas on overall revenue per system that we saw in Q3, where we still have some pressure, but we've seen that decline to less than 1%. So while we're a B2B business, and it doesn't tell us exactly what's happening at the end consumer, that gives us some insight that we're seeing some health in terms of utilization, as Pedro mentioned, for the demand for our consumables, which is encouraging.

Pedro Malha

I will just end by addressing the question around the market and the consumer sentiment in terms of dynamics. So consumers are still interested in outcomes; that's still clear in the market. But as we keep mentioning in prior calls, their dollars are spread across more treatments and providers, and that is why we as an organization have to work harder to be the preferred treatment and help providers monetize it better. This is why utilization, differentiation, and consumer experience matter in our business.

Also, the cost of capital is delaying equipment decisions, and that is why the response from us has to be better provider economics, more flexible access, like we kept discussing here—the rental program—and treatments need to drive repeat visits. That's why we are so focused on having our booster and treatment enhancers and extenders strategy.

Unknown Speaker

Thank you for the call.

Operator

Our next question comes from Bruce Jackson with StoneX.

Bruce Jackson

On new products, you said you're going to be increasing R&D here. Is it going to be going up sequentially and year-over-year? And you mentioned the new platform that you're working on. Is there anything else in the new product development that you're working on?

Pedro Malha

So in terms of the new devices, the program is progressing towards the planned 2027 launch. Again, this is not a Hydrafacial device. We are not going to give product specifics or economics today or commit to a launch date; the commitment is 2027. But the strategic logic here is to add another complementary treatment category through an infrastructure that we already have. Again, we will provide more details when the product and the commercial plans are ready.

In terms of the next-generation Hydrafacial, this is a very important long-term initiative for us, and that is targeted for 2028. But it's not part of the foundation of our near-term recovery plan because that is 2028. But we are designing and investing in a machine that will improve clinical outcomes, improve workflow, and improve treatment experience, and it will create reasons for both existing and prospective providers to invest in a new device. We are not disclosing any product features on this call, and we will release more information as we see fit.

Bruce Jackson

Okay, and then a quick follow-up just in terms of the product portfolio vitality: a rough idea of the percentage of the mix that the new products contribute to sales, and is this something that could be expected to help accelerate revenue at some point in the future?

Pedro Malha

So in terms of the strategy, absolutely. Basically, all these product launches are there to create more occasions to use the same system and serve customers in more ways. The booster addresses specific skin concerns. The enhancer or extender can personalize or broaden an existing treatment protocol. All of this supports premium treatments, repeat visits, and higher consumables per treatment. That is the strategy.

We are not going to give standalone revenue forecasts per product SKU, but the way to assess success is how this is contributing to recurring revenue over time. New consumables require providers to adopt the protocols and consumables to incorporate them into the treatment routines that they have in these practices. If you look at SkinStylus, that is already generating growth, and we're using SkinStylus to expand internationally. The other products are very early—we just launched them in commercialization. So I wouldn't expect everything to show up all at once in 1 quarter, but the benefits of all these launches and the cadence of all these launches should show over time progressively as we see adoption in the markets increase.

I think the most important part of all of this is that we are working as a company to build several complementary growth drivers rather than solely being focused on the recovery of equipment sales. That is the key work that we focus on.

Bruce Jackson

Okay, thank you very much. That's it for me.

Operator

There are no further questions. Ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect.

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