Hansen Medical (NASDAQ:HNSN) saw revenue grow 139% year over year during the quarter, but when a company is in the early start-up phase, it's quarter-over-quarter growth that counts. Hansen's stock today is following its quarter-over-quarter revenue growth: down.

The robotic catheter maker's revenue decreased quarter over quarter because it only sold 279 disposable catheters versus 401 in the first quarter. Hansen doesn't think this was because doctors are performing fewer procedures, but just the lumpiness of sales. A few large orders can throw off the quarterly numbers when you've only got 30 or so customers.

Hansen's bigger problem is that the growth of system sales seems to be slowing down a bit -- it sold the same number of systems in the second quarter as it did in the first quarter. That's no way to run a business, especially when system sales will drive catheter sales and service revenue in future quarters.


Q1 2007

Q2 2007

Q3 2007

Q4 2007

Q1 2008

Q2 2008

Number of Sensei systems sold







Source: Company press releases.
*Two systems were shipped in Q1 2007 but were recognized as revenue in Q2 2007.

It's going to have to pick up the pace of system sales if it wants to catch rival Stereotaxis (NASDAQ:STXS).

Hansen is guiding for another 28 to 34 sales in the second half of the year and it's already shipped at least two of them, so systems sales are far from stagnant if the company can hit its goal. It's recently upped its capacity to be able to crank out five systems per month, so if the sales force can sell them, the company should be able to ship them.

Founder Frederic Moll certainly hopes he can repeat his previous success and make Hansen the next Intuitive Surgical (NASDAQ:ISRG), a company he helped co-found, but the company is going to have to convince doctors that its machines will make the procedure to correct cardiac arrhythmia safer or more effective -- as Intuitive Surgical has done with its prostatectomies.

I'm willing to give the Rule Breakers pick a pass this quarter, but investors should keep Hansen on a short leash and cut it loose if it doesn't look like the company is getting it done.

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Fool contributor Brian Orelli, Ph.D., doesn't own shares of any company mentioned in this article. The Fool has a disclosure policy.