What happened
Shares of Align Technology (ALGN -1.04%) were down more than 10% late Thursday afternoon after the healthcare company announced first-quarter earnings. Align is the maker of the Invisalign clear teeth aligners, as well as the hardware, services, and software that go into straightening crooked teeth. Invisalign teeth aligners have the advantage of being more comfortable and discreet compared to traditional metal braces. The company's shares are still up more than 51% so far this year.
So what
The report was a mixed bag, as the company did better than it did last quarter, but its numbers were down compared to the same period last year. It was also the second consecutive quarter that the company had better numbers sequentially. Align reported first-quarter revenue of $943.1 million, down 3.1% year over year but up 4.6% sequentially. The company's net income was $140.6 million, up 4.8% sequentially but down 21%, over the same period last year.
Align did complete its $1 billion stock repurchase program, buying 942,000 shares for a price tag of $290 million during the quarter.
Now what
Perhaps the most positive news in the report was the company's guidance, which predicts the second quarter will also show growth over the first quarter. Invisalign said it expects second-quarter revenues to be between $980 million to $1 billion and full-year operating margin of slightly above 16%. Align credited the company's doctor subscription program and its Vivera retainers for driving revenue.
The company had more than 21 million annual orthodontic case starts, and the largest portion of that were teens and children, with 182,000 starts, an improvement sequentially and year over year. One area that lagged, though, was service revenue, which was down 9.7% year over year to $153.3 million.
