Cuộc họp công bố kết quả kinh doanh quý 2/2026 của IRIDEX (IRIX): Tăng trưởng G6 và dòng tiền dương

Cuộc họp công bố kết quả kinh doanh quý 2/2026 của IRIDEX đã điểm qua dòng tiền dương trong quý và đà tăng trưởng tiếp tục của dòng sản phẩm Cyclo-G6, trong khi doanh số mảng võng mạc suy yếu đã khiến tổng doanh thu giảm 7%. Ban lãnh đạo tái khẳng định dự báo doanh thu cả năm và kỳ vọng hoạt động thương mại sẽ mạnh mẽ hơn trong nửa cuối năm, đặc biệt là trong quý 4.

Điểm nhấn chính

• Doanh thu quý 2/2026 đạt 12,6 triệu USD, giảm 7% so với 13,6 triệu USD cùng kỳ năm ngoái, chủ yếu do doanh số các sản phẩm võng mạc giảm.
• Doanh thu dòng sản phẩm Cyclo-G6 tăng 19% so với cùng kỳ năm ngoái lên 3,9 triệu USD. Sản lượng đầu dò tăng 35% lên 17.700 đơn vị, nhờ mức độ sử dụng cao hơn và giá bán trung bình tại Mỹ tăng.
• Doanh thu mảng võng mạc giảm xuống 6,5 triệu USD từ mức 8,0 triệu USD trong bối cảnh chuyển đổi thương mại quốc tế, các rào cản pháp lý và thời điểm điều chỉnh hàng tồn kho của nhà phân phối.
• IRIDEX đã tạo ra dòng tiền dương trong quý và kết thúc kỳ với 4,7 triệu USD tiền và các khoản tương đương tiền, tăng 0,1 triệu USD so với ngày 4 tháng 4 năm 2026.
• Ban lãnh đạo tái khẳng định dự báo doanh thu năm 2026 từ 51 triệu USD đến 53 triệu USD, không bao gồm doanh thu từ Trung Đông. Khoảng dự báo này tương ứng với mức tăng trưởng pro forma khoảng 1% đến 5% so với năm 2025.
• Ban lãnh đạo dự kiến việc đầu tư tạm thời vào hàng tồn kho an toàn liên quan đến chuyển trụ sở chính sẽ làm giảm lượng tiền mặt hiện có trong suốt năm 2026 trước khi lượng hàng tồn kho tăng cao được giải phóng vào năm 2027.

Dữ liệu tài chính quan trọng

Kết quả kinh doanh và hoạt động

Tăng trưởng mảng thiên đầu thống vẫn do đầu dò dẫn dắt

Sản lượng đầu dò Cyclo-G6 đạt 17.700 đơn vị, tăng 35% từ mức 13.100 đơn vị của cùng kỳ năm trước. Ban lãnh đạo cho biết sự tăng trưởng tại Mỹ là nhờ tiếp cận bác sĩ mục tiêu thông qua MedScout, hỗ trợ hoàn phí từ Medicare LCDs và giá bán trung bình của đầu dò và hệ thống cao hơn.

Tăng trưởng diễn ra diện rộng tại các khu vực. Tuy nhiên, một số nhà phân phối quốc tế, bao gồm các đối tác ở Nhật Bản và Châu Âu, đã đặt các đơn hàng lớn hơn trước giai đoạn gián đoạn đăng ký liên quan đến việc chuyển trụ sở chính. Ban lãnh đạo cho biết nếu không tính các đơn đặt hàng trước này, tăng trưởng đầu dò vẫn vượt quá 15%.

Số lượng hệ thống Cyclo-G6 được lắp đặt đã giảm xuống 18 đơn vị từ 35 đơn vị. Sự sụt giảm này phản ánh thời điểm đặt hàng ở Châu Âu, Trung Đông và Châu Phi, cũng như áp lực cạnh tranh đối với việc lắp đặt thiết bị điều khiển mới tại các hoạt động của công ty ở Đức và Áo.

Doanh số mảng võng mạc đối mặt với khó khăn tạm thời

Doanh thu mảng võng mạc giảm xuống 6,5 triệu USD do quá trình chuyển đổi thương mại, các rào cản pháp lý và việc quản lý tồn kho của nhà phân phối ảnh hưởng đến các đơn đặt hàng quốc tế. Tại Trung Quốc, nhà phân phối cần bán hết lượng hàng tồn kho hiện có trong khi IRIDEX tiến hành quá trình gia hạn cấp phép.

Tại Mỹ, IRIDEX đã bổ sung thiết bị tay cầm EndoProbe vào danh mục ưu đãi iPRO GPO, mở rộng mức giá ưu đãi cho hơn 4.300 phòng khám, trung tâm phẫu thuật ngoại trú và bệnh viện hội viên. Ban lãnh đạo cũng kỳ vọng PASCAL sẽ nhận được phê duyệt MDR của Châu Âu trong nửa đầu năm 2027.

Cắt giảm chi phí và chuyển đổi sản xuất

Chi phí hoạt động giảm 5%, chủ yếu do chi phí quản lý doanh nghiệp thấp hơn. IRIDEX dự kiến sẽ hoàn tất việc chuyển trụ sở chính vào cuối năm 2026 và tiếp tục chuyển dịch sản xuất sang các nhà sản xuất hợp đồng bên thứ ba có chi phí thấp hơn. Ban lãnh đạo xem cả hai sáng kiến này là động lực tiềm năng thúc đẩy biên lợi nhuận gộp trong năm 2027.

Dự báo của Ban lãnh đạo

IRIDEX tái khẳng định dự báo doanh thu cả năm 2026 từ 51 triệu USD đến 53 triệu USD. Triển vọng này loại trừ doanh thu từ Trung Đông do sự gián đoạn liên quan đến xung đột đang diễn ra, đồng thời tương ứng với mức tăng trưởng pro forma khoảng 1% đến 5% so với năm 2025 sau khi loại bỏ doanh thu Trung Đông của năm trước.

Công ty cũng giữ nguyên dự báo chi phí hoạt động điều chỉnh năm 2026 ở mức 19 triệu USD đến 19,5 triệu USD, bao gồm chi phí khấu hao và chi phí thưởng bằng cổ phiếu.

Trong nửa cuối năm 2026, ban lãnh đạo kỳ vọng mức tăng trưởng ở mức một chữ số thấp ở mảng võng mạc và ở mức hai chữ số thấp ở mảng thiên đầu thống. Công ty dự kiến quý 4 sẽ tiếp tục mạnh hơn đáng kể so với quý 3, phù hợp với quy luật theo quý trước đây của công ty.

Rủi ro và các yếu tố cần theo dõi

• Việc mua hàng tồn kho an toàn trước khi chuyển trụ sở chính dự kiến sẽ yêu cầu thêm vốn lưu động và làm giảm lượng tiền mặt hiện có trong suốt năm 2026.
• Việc đăng ký lại sản phẩm và các giai đoạn gián đoạn liên quan có thể tạo ra biến động về nguồn cung và thời điểm đặt hàng trên các thị trường quốc tế.
• Kết quả kinh doanh mảng võng mạc vẫn chịu rủi ro từ sự chậm trễ gia hạn cấp phép, mức tồn kho của nhà phân phối và việc triển khai không đồng đều tại các thị trường quốc tế.
• Áp lực cạnh tranh tiếp tục ảnh hưởng đến việc lắp đặt thiết bị điều khiển Cyclo-G6 tại một số khu vực ở Châu Âu.
• Các đơn đặt hàng dự trữ lớn hơn của nhà phân phối tại một số thị trường có thể dẫn đến sức mua thấp hơn trong các quý tiếp theo.
• Triển vọng cả năm loại trừ doanh thu từ Trung Đông do sự gián đoạn khu vực đang diễn ra.

Điểm nhấn phần Hỏi & Đáp với chuyên viên phân tích

Ban lãnh đạo kỳ vọng doanh thu mảng võng mạc trong nửa cuối năm sẽ tăng trưởng ở mức một chữ số thấp so với cùng kỳ năm ngoái, nhờ sự tiến triển về mặt pháp lý, các cơ hội từ PASCAL và các hoạt động quảng bá tại Mỹ xung quanh hội nghị của Viện Nhãn khoa Hoa Kỳ.

Về sản phẩm đầu dò thiên đầu thống, ban lãnh đạo thừa nhận rằng các đơn đặt hàng trước từ quốc tế đã làm tăng sản lượng trong quý 2 trước các giai đoạn gián đoạn đăng ký. Dù vậy, ban lãnh đạo chỉ ra rằng mức tăng trưởng cốt lõi vẫn ở trên mức 15% sau khi loại trừ các đơn hàng đó và dự báo mức tăng trưởng ở mức hai chữ số thấp cho nửa cuối năm.

Ban lãnh đạo cũng kỳ vọng doanh số hệ thống Cyclo-G6 sẽ cải thiện vào cuối năm, trong đó quý 4 được dự báo sẽ là quý lớn nhất của công ty với khoảng cách đáng kể.

Toàn văn biên bản cuộc họp báo cáo kết quả kinh doanh

Toàn văn cuộc gọi công bố kết quả kinh doanh

Phần trình bày của ban lãnh đạo

Operator

Thank you for standing by. My name is Tina, and I will be your conference operator today. At this time, I would like to welcome everyone to the Q2 2026 IRIDEX Earnings Conference Call. [Operator Instructions] It is now my pleasure to turn the call over to [ Tripp Taylor ], Investor Relations. Please go ahead.

Unknown Executive

Thank you, Operator, and thank you all for joining us this afternoon. With me on today's call are [ Patrick Mercer ], IRIDEX's Chief Executive Officer, and Romeo Dizon, the company's Chief Financial Officer. Earlier today, IRIDEX issued a press release detailing our financial results for the quarter ended July 4, 2026, to the investor section of our website. Before we begin, I'd like to remind you that management will make statements during this call that include forward-looking statements within the meaning of federal securities laws, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

Any statements made during this call that are not statements of historical fact, including but not limited to statements concerning our strategic goals and priorities, product development matters, sales trends, and the markets in which we operate. All forward-looking statements are based upon our current estimates and various assumptions. These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated or implied by these forward-looking statements. Accordingly, you should not place reliance on these statements.

For a discussion of the risks and uncertainties associated with our business, please see the most recent Form 10-K and Form 10-Q filings with the SEC. IRIDEX disclaims any intention or obligation, except as required by law, to update or revise any financial projections or forward-looking statements, whether because of new information, future events, or otherwise. This conference call contains time-sensitive information and is accurate only as of the live broadcast today, August 18, 2026. With that, I'll pass the call to Patrick.

Patrick Mercer

Good afternoon, everyone, and thank you for joining us for our second quarter call. If there is one message I want to leave you with today, it is that IRIDEX has reached an important inflection point in its financial profile. We generated positive cash flow in the second quarter, demonstrating the meaningful progress we have made over the past two years to fundamentally transform our cost structure, strengthen working capital management, and create a more disciplined and sustainable business. As part of our activity to further improve the efficiency of the business, this month we began the process of relocating our headquarters.

This is a long-anticipated cost-cutting step, and an important part of our broader effort to optimize our cost structure, improve operational efficiency, and align our infrastructure with the business we are building for the future. The headquarters move will require a new registration process and managing global registration blackout periods. In order to secure our international supply chain and protect top-line distributor revenue streams through the transition, we are in the process of building safety stock inventory to maintain supply continuity. This project is being implemented in careful coordination with our vendors and distribution partners, all of whom are familiar with the special demands of medical device manufacturing, and particularly the necessary regulatory approvals.

We anticipate that the temporary working capital investment, which impacted our second quarter cash flow and will further impact our third quarter cash flow, will enable us to achieve our 2026 revenue guidance of $51 million to $53 million. Cash flow from operations should be unaffected, but the increased deployment of working capital will reduce our cash on hand through 2026, without reversing and becoming a cash tailwind in 2027 as we work down the elevated inventory levels and continue to more tightly manage our working capital. We continue to right-size the business with discipline, and the positive cash flow we delivered in the second quarter is a proof point of our success and the growing financial strength of the business.

I am pleased to announce that we have again reduced our operating expenses compared to the prior year period through our various cost savings initiatives. As mentioned previously, the relocation of our headquarters is ongoing, and the multi-year shift of production to lower-cost third-party contract manufacturers continues to advance. We view both as becoming powerful drivers of improving gross margins ahead in 2027. We believe some of the timing-related impacts that affected our first half 2026 performance represent incremental revenue opportunities for the remainder of the year. Our focus in the back half of the year remains on strengthening our supply chain, building inventory ahead of our manufacturing transitions, and advancing our international regulatory submissions.

Now, turning to our commercial performance in the quarter, our glaucoma business once again delivered solid, probe-led growth this quarter. This continued growth in demand and utilization for this higher-margin product is an encouraging indicator of the increasing utilization of our G6 platform, demonstrating the increasing adoption of our technology by physicians. In our retina business, we faced a number of market dynamics and operational execution challenges that affected commercial activity during the quarter. We are actively addressing these factors and remain focused on strengthening execution, improving performance, and positioning the retina business for sustainable, profitable growth.

Total revenue for the quarter was $12.6 million. Cyclo-G6 probe volume rose roughly 35% year-over-year, and G6 product family revenue increased 19%, a direct reflection of expanding physician adoption of our non-incisional approach and increased utilization of the G6 platform. The breadth of this growth is encouraging as it came from every region in which we operate. Year-over-year revenue decline in our overall business was driven entirely by retina and by a set of temporary commercial transition and regulatory-related factors internationally, rather than by any change in the fundamental demand of our products.

Starting with glaucoma for the quarter, Cyclo-G6 probe volume totaled 17,700 units, a 35% increase from 13,100 units sold in the prior year period. In the U.S., three initiatives are driving strong growth: customer targeting with MedScout, LCD tailwinds, and increased ASPs. Our primary growth driver in glaucoma this quarter continued to be increased utilization of the G6 platform with particularly strong momentum in probe volumes. Through MedScout, we have become increasingly targeted in how we identify and engage physicians with the greatest opportunity to expand utilization.

We are focused on two key segments: existing G6 accounts with moderate utilization, where there's an opportunity to increase procedure volume, and high-volume glaucoma practices that have not yet incorporated MicroPulse therapy into their treatment protocols. In both segments, our [ commercial campus ] is focused on the treatment of glaucoma, working directly with physicians through education focused on appropriate patient selection, clinical outcomes, and the efficacy and versatility of the procedure. This targeted approach is helping us move beyond simply placing systems and toward driving greater utilization of the install base.

We're also seeing continued tailwinds from the Medicare LCDs implemented last year, which have supported broader consideration of MicroPulse therapy across the glaucoma treatment continuum. Our commercial organization is using these reimbursement developments as an important educational opportunity, working with physicians to highlight the procedure's ability to lower IOP while providing a non-incisional, repeatable treatment option. We believe this combination of clinical education, reimbursement support, and growing physician experience is helping expand the role of G6 therapy within glaucoma treatment pathways.

The third contributor to glaucoma revenue growth was another increase in U.S. average selling prices for both probes and systems. Continued improvement in ASPs reflects the value physicians place on MicroPulse therapy and the clinical utility of the G6 platform. Importantly, as we increase utilization within the installed base, we believe the combination of higher probe volumes and increased ASPs provides an attractive foundation for continued growth in the glaucoma business. On systems, we placed 18 Cyclo-G6 units during the quarter versus 35 in the prior year period. That step-down was driven largely by order timing in Europe, Middle East, and Africa, together with ongoing competitive pressures on new console placements in our GmbH business.

Moving to the international glaucoma business, in Europe, Middle East, and Africa, our U.K. registry is progressing nicely, and engagement from the clinical community has remained strong. We believe the data generated through the registry will be an important step in supporting broader reimbursement for MicroPulse therapy in the U.K. Expanded reimbursement would improve access for patients, increase physician adoption, and over time drive greater utilization of the installed G6 base and increased probe volumes. We believe this positions us well for continued growth in the U.K. and broader adoption across the region.

In GmbH, Germany and Austria operations again performed well as we continue to reclaim business previously handled by our former distributor. The main soft spot in the region remains G6 console sales, where competition persists for new console placements. In Asia, our distributor partner began stocking inventory ahead of the coming business transition in Japan, which increased purchases of MicroPulse P3 probes, EndoProbes, and PASCAL systems. In Latin America and Canada, G6 probe sales held steady, driven primarily by Brazil, where our distributor increased inventory in preparation for our upcoming business. In Canada, we are seeing the commercial focus and initiatives implemented last quarter deliver stable results.

Taken together, glaucoma growth was broad across our international regions this quarter, which reinforces how durable our value proposition is globally. Now turning to our retina portfolio, our strategy remains focused on three pillars: advancing the PASCAL upgrade cycle domestically, expanding [ PASCAL FGAL's ] international footprint, and securing regulatory clearances for our next-generation platforms that will allow us to leverage our global distribution network. We remain encouraged by the opportunity for our retina business, and customer demand remained strong. That said, during the quarter, we confronted the market and operational execution dynamics that impacted sales during the quarter.

We are actively addressing these factors and are confident we are implementing long-term solutions that will improve our execution and distributor sell-through. Since our last earnings call, we took an important step to broaden access to our retina product portfolio domestically, announcing the addition of our EndoProbe handpieces to our existing product offering with iPRO GPO. That agreement now gives us more than 4,300 member practices, regulatory surgery centers, and hospitals across the country preferred pricing on EndoProbe, building on the PASCAL IQ532, IQ577, OcuLight TX, and Cyclo-G6 platforms already available through that channel.

We see this as a meaningful expansion of the value we offer retina specialists and ophthalmic providers and another lever supporting our U.S. retina business going forward. Turning to international retina, abroad, retina results were inconsistent, and we are taking steps to ensure we are executing commercially and operationally to satisfy the strong demand from our global customer base. In Europe, Middle East, and Africa, we expect PASCAL to secure MDR approval in Europe in the first half of next year. We anticipate meaningful demand once that certification is complete.

In China, sell-through was impacted by regulatory constraints, as well as the need for our distributor to work through existing inventory before placing additional orders. We're actively progressing the regulatory renewal process and expect these factors to normalize over the coming quarters. In Latin America and Canada, PASCAL sales resumed following previous market challenges, and we anticipate continued momentum and growth throughout the remainder of the year. As we turn to the rest of 2026, our priorities remain focused on commercial and operational execution, in conjunction with continued expense management to drive positive cash flow from operations for the year.

In alignment with these priorities, we are reaffirming our full-year revenue guidance of $51 million to $53 million. To reiterate, that range excludes revenue from the Middle East region and on a comparable basis reflects roughly 1% to 5% pro forma growth against 2025. The cadence of international ordering has had a meaningful effect on our results this quarter. In some markets, that sets up incremental opportunity as previously deferred backlog shifts and the product re-registration tied to our relocation are completed. In others where distributors placed larger stocking orders this quarter, we expect a corresponding decline next quarter, representing some continued choppiness in different regions globally. I'll now hand the call over to Romeo to take you through the financials.

Romeo Dizon

Thanks, Patrick, and good afternoon, everyone. As Patrick noted and as detailed in our presentation, press release, total revenue for the second quarter of 2026 was $12.6 million, down 7% from $13.6 million in the second quarter of 2025. The year-over-year decline stemmed mainly from lower retina product sales, which were partly offset by continued growth in glaucoma probe sales. Turning to components, retina product revenue was $6.5 million versus $8.0 million in the prior year period. As Patrick noted, the decline was driven entirely by temporary headwinds, including international commercial transitions and regulatory-related factors. Underlying global demand for our core products remained robust and fundamentally intact.

Total product revenue for the Cyclo-G6 product family was $3.9 million, representing growth of 19% year-over-year, compared to $3.3 million in the prior year quarter. Growth is attributed to both an increase in unit volumes, both in the U.S. and internationally, and an increase in ASP domestically. Other revenue is $2.2 million, essentially flat compared to $2.2 million in the second quarter of 2025. Gross profit in the second quarter was $4.3 million, translating to a gross margin of 34.2%, relatively flat with $4.7 million or 34.5% in the prior year period. Favorable contribution from our higher-margin glaucoma probe was largely offset by softer retina systems margins and by a number of cost pressures in the quarter.

We continue to view our transition to lower-cost third-party contract manufacturers as a meaningful driver of gross margin improvement over the balance of the year and into 2027. Operating expenses were $5.3 million in the second quarter of 2026, down $0.3 million, or 5%, compared to $5.6 million in the second quarter of 2025. That reduction was driven primarily by lower general and administrative expenses, reflecting savings from the administrative function transfer initiative we've highlighted in prior periods. Progress on that initiative continues, and we remain on schedule to complete our headquarters relocation later this year.

Net loss was $1.3 million or $0.07 per share for the second quarter of 2026 compared to a net loss of $1.0 million or $0.06 per share in the same period of the prior year. Non-GAAP adjusted EBITDA for the second quarter of 2026 was a loss of $0.4 million for the quarter, compared to a non-GAAP adjusted EBITDA income of $21,000 in the second quarter of 2025. We ended the quarter with cash and cash equivalents of $4.7 million as of July 4, 2026, an increase of $0.1 million compared to April 4, 2026. As Patrick emphasized, we were pleased to deliver positive cash flow in the quarter, a meaningful marker of the financial discipline now driving the business, achieved through disciplined cost control and improved working capital, even as we build safety stock for certain distributors ahead of our relocation.

Across the remaining quarters, we expect quarterly cash generation to build sequentially as we sell through inventory and collect receivables on higher revenue. However, we anticipate a temporary reinvestment of operating cash flow into advanced inventory procurement. This proactive buffer secures our international supply chain and protects top-line distributed revenue streams while we transition to our new production facility. Turning to guidance, we are reaffirming our 2026 guidance to expect revenue in the range of $51 million to $53 million. As a reminder, given the market [ disruption ] for the ongoing conflict in the Middle East, that outlook excludes revenue from the region.

On a pro forma basis that strips out 2025 Middle East revenue, the guide implies 2026 growth of 1% to 5% over 2025. We are also reiterating our expectation for adjusted operating expenses, which include depreciation and amortization and stock compensation, to be in the range of $19 million to $19.5 million for the full year of 2026. I will now pass the call back to Patrick for his closing remarks.

Patrick Mercer

Thanks, Romeo. Looking back on the second quarter, I'm energized by the continued broad-based strength of our glaucoma franchise, and above all, by our demonstrated ability to manage the business to positive cash flow. Our cost discipline keeps translating into stronger cash generation, and both our manufacturing transition and our headquarters relocation remain firmly on course to deliver meaningful additional margin improvement as the year unfolds. Our priorities for 2026 remain firmly in place: growing G6 utilization and adoption globally, securing international regulatory approvals to open up new geographies for our retina systems, and completing the move to lower-cost contract manufacturers to increase gross margin.

The foundation we built is solid. Our path to sustained profitability is clear, and we're excited about what lies ahead. We appreciate your continued support of IRIDEX, and we look forward to sharing our progress with you again next quarter. I will turn the call over to the operator for questions.

Operator

Our first question comes from the line of Scott Henry. Please go ahead.

Phần hỏi đáp

Scott Henry

First on retina, it sounds like there's a lot of moving parts domestically and international. The question is, do you expect retina to grow year-over-year if I look at the full year, which would require a pretty significant boost in the second half? So even if we forget about the full year, do you expect second half '26 to be higher than second half '25?

Patrick Mercer

Yes. Thank you, Scott, for the question. We expect the second half of the year for retina to show low single-digit growth. We have several important tailwinds as we advance international regulatory approvals. We expect that to broaden our addressable market and improve overall performance, particularly with our flagship product, PASCAL. And in the U.S., on the back half of the year, we expect momentum as we head into the American Academy of Ophthalmology meeting. We plan on implementing our annual promotion programs, which really help us with the sale of the capital equipment and really drive in customer engagement coming out of that meeting.

Those are the tailwinds that we see. We had headwinds due to the continued disruption in the Middle East. We had some sell-through delays in China due to some stocking orders previously for the tariffs, and just managing our relocation and those subsequent inventory management for the blackout periods due to our headquarter relocation. But we do, again, expect the second half to generate low single-digit growth for retina.

Scott Henry

Okay, and would you expect, you know, historically the fourth quarter is a lot stronger than the third quarter. Would you expect that to be the case this year as well?

Patrick Mercer

Yes, most definitely. It's our largest by quite a bit, generally speaking, Q4.

Scott Henry

Okay. And then shifting to glaucoma, 17,700 probes was a lot for Q3, biggest quarter of the last five quarters or six quarters by far. Do you think there was any inventory build there among your customers? I mean, should we expect that to normalize back to more typical levels, or is this a new normal?

Patrick Mercer

No, I wouldn't say it's a new normal. We do expect low double-digit growth for the second half of the year. If you back out, so we did have Japan place some orders, heavier orders to manage the blackout period. And if you, not just Japan, but in Europe, we had some of that too to support the blackout periods. But if you back that out, we still had over 15% growth, which is, if we get that at the back half of the year, we'll be very happy with. So there was some, I'll call it lumpiness due to the pre-orders to cover the blackout period, but with that backed out, we still had really good growth.

Scott Henry

Okay, and also, final question, the system sold 18, on the other hand, was a little bit of a lower number. Would you expect that to jump back higher in the second half of the year? How should we think about that 18 as far as a go-forward?

Patrick Mercer

We believe it's going to be much higher towards the back end of the year. We are, again, Q4 is our largest quarter and that includes system sales as well, so we expect those numbers to be higher as we move forward. We did have some slowness in Europe, Middle East, and Africa that, you know, waiting on approval that U.K. registry will once we get that approval there for reimbursement that will help boost some sales there so that hurt us this quarter but we do expect those numbers to increase over the second half of the year.

Scott Henry

Okay, great. Thank you for taking the questions.

Patrick Mercer

Thank you. And thank you all for joining us.

Operator

Thank you again for joining us today. This does conclude today's conference call. You may now disconnect.