On Oct. 27, Align Technology (ALGN 1.28%) will report its third-quarter earnings, and smart investors will be paying close attention when it does. The maker of the Invisalign tooth straighteners has a lot of different plates spinning with its international expansion plans, and the pandemic is constantly threatening to muck up the works.

If you're considering purchasing Align's stock, the Q3 results just might have the last pieces of information that you need to make a decision. Let's dive in and take a look at which issues prospective investors and current shareholders should care about most.

Patient holding clear aligner while getting a consultation from a professional.

Image Source: Getty Images.

Has the delta variant impacted sales?

The most important thing in Align's earnings report will be its results from sales of its Invisalign tooth straighteners, which it sells by the case to dental clinics worldwide. If the last few years are any indication, the company will report a substantially heartier helping of income in the third quarter than the quarter before. The same goes for increasing its earnings before interest, taxes, depreciation, and amortization (EBITDA), which have also grown steadily in recent years alongside its expanding profit margin.

The exception to the trend was, of course, in the second quarter of last year, when the pandemic's full negative impact on the global economy was registered for the first time. Align's sales and earnings plummeted, and its expenses became a much higher proportion of quarterly revenue as a result. Thankfully, the company returned to growth in the subsequent quarter, and there haven't been any issues since. Until the delta variant came around during the second quarter of 2021, that is. In the most recent quarter, the company was able to generate $1 billion in quarterly revenue for the first time in its history, so watching how the third quarter fares could be key.

ALGN Revenue (Quarterly) Chart

ALGN Revenue (Quarterly) data by YCharts

Given that people need to go into a dental clinic to get fitted for their Invisalign straighteners, the elevated risk of getting sick during the delta surge could have dissuaded many of the business' potential customers from starting the onboarding process. Plus, in the U.S., younger teenagers have only been eligible to be vaccinated against the coronavirus since May. Since teenagers are one of Align's core target customers (roughly 70%), the fact that they may still be in the midst of the vaccination process could be an impediment to growth.  

Per its last earnings report, management expected the third quarter to bring "continuing uncertainty around the pandemic and increasing restrictions related to COVID-19 in certain geographies." The company is "also anticipating more pronounced summer seasonality across all regions" than what has been experienced in recent years. Between the slower sales in summer and the delta variant's rampage across the world, it wouldn't be surprising if Align's performance took another hit. 

Nonetheless, investors should realize that such a hit will be temporary, as shown by consumers flocking back to buy straighteners after the first few months of the pandemic. So, if the stock sinks, consider it as a buying opportunity, as the competitive merits of the company haven't changed. 

How's the supply chain holding up?

The other major issue in the earnings report will be an update on how Align is faring with the ongoing global supply chain disruptions. If supply chain issues are getting in the way of manufacturing its aligners or the dental imaging devices for consultation, there could be a negative impact to its ability to meet demand. 

Particularly, the ongoing semiconductor shortage could threaten the production of its imaging devices. When dental offices can't get the hardware they need to customize the straighteners to work with patients' teeth, the company can't onboard new customers. Likewise, if global shipping problems interfere with the delivery of cases of aligners, it'll slow revenue growth. At the moment, there's no indication that Align is having any problems with its supply chain. If any obstacles to manufacturing or delivering its products arise, it's probable that they'll be temporary. 

Still, investors should take care to see if management drops any hints about the prospects of future disruption, even if there wasn't any impact in the Q3 results. For a company with global ambitions, seemingly minor hiccups in serving demand could be an opportunity for smaller competitors to elbow their way into regional markets. I doubt that the earnings report will have any bombshells that might be a deal-breaker for prospective investors, but it just might show some blunting of the company's momentum.