Align Technology, Inc. (NASDAQ:ALGN) Q4 2022 Earnings Call Transcript

Jeffrey Johnson: Joe, I just want to ask a couple of questions here. I guess, one, just on the Clear Aligner volume guidance for 1Q. It sounds like it’s because China, incrementally weaker stability in Americas and the EMEA, you kind of had that in the press release. You got some hedging words in there about primarily due to weakness in China and some stability in the Americas and EMEA. I mean, should we be thinking at this point that your Americas and the EMEA are kind of a baseline here? And I know, obviously, macro can change from here, but assuming that macro change away, are we kind of at a baseline level now in absolute volumes for Americas and the EMEA? And do you think China, could it be a recovery play throughout this year? Are you seeing any early signs of some pickup in some of those big dental hospitals or the new adult standard product there or anything?

Joseph Hogan: Jeff, first of all, on the front end with the Western economies is we just see stability. That’s what we talked about. That’s what we see versus before we saw the market falling away from us. So right now, we see it being stable. And feel better about that point. On China, I mean, uncertainty in China is incredible when you think about billion people being sick there right now or have been sick over the last couple of weeks. And Jeff, I refuse to give a forecast over a number of quarters now because a lot of it has to do with the uncertainty that we see in China and specifically, which our second biggest market in the world. So I don’t want to try to forecast China right now. I can tell you now it’s a blur for us and very difficult, but just we feel good about where we stand with EMEA and the States from a stability standpoint. We try to reflect as much in our words, what we see for the first quarter for you, too.

Jeffrey Johnson: Understood. And I’m sure there’s going to be a lot more questions here on the short-term things. I don’t want to look or ask you about the Desktop Metal deal, though. On that, right now, is it all for kind of milling using iTero to connect to the lab there for milling and/or 3D printing of just restorations. Are you guys doing any early work with them on 3D printing of Clear Aligners? And just kind of again kind of update us maybe with your most recent thoughts on when we might start seeing 3D printing of the aligners in the office and kind of your competitive advantages you think you can — as Align carve out in that kind of setting?

Joseph Hogan: Yes, Jeff, that’s a good question. The Desktop Metals is primarily we think about a restorative play, how labs play a huge role and restore a dentistry with general dentists. I mean, they’re really strong partners in that sense. What Desktop Metal represents is you see a lot of 3D printing going on. There’s some really great resin development around restorative types of things, dentures, different areas the Desktop Metal leads in and our iTero scanner can really help with that, too. Also, we have a vision of ortho restorative where you use our orthodontic procedures in order to reduce the amount of tooth loss mass that often comes with restorative procedures, too, that we’ll work together with Desktop about. The idea of printing aligners and standard types of STL kind of processes from a 3D standpoint.

I don’t see that. And honestly, Jeff, I’m not one to think that doctors should turn their offices into production facilities. 3D printing is hard. The materials are difficult. There’s a lot of doctors actually trying it, but I feel like doctors are much better being physicians and doctors in that sense than trying to run a manufacturing operation.

Jeffrey Johnson: Even in that first case to try to seal the deal and really lock that patient in as a pain customer?