LENSAR (NASDAQ:LNSR) executives used the company’s fourth-quarter and full-year 2025 earnings call to outline how the cataract-laser maker plans to reaccelerate growth as a standalone company following the termination of its proposed acquisition by Alcon.
Chief Executive Officer Nick Curtis said 2025 was “a unique and unprecedented year” for the company, marked by the March 2025 joint acquisition announcement and the subsequent decision to end the deal after the Federal Trade Commission indicated it would seek to block the merger. Curtis called the termination “a mutual pragmatic decision,” adding that while the outcome was disappointing, the process publicly validated the company’s ALLY Robotic Cataract Laser System and the value Alcon saw in LENSAR.
Deal termination and balance sheet impacts
Staab also said LENSAR recorded $17.1 million of acquisition-related costs in 2025, with $14 million unpaid as of December 31. With the merger terminated, he said approximately $4.3 million of the unpaid balance will be eliminated or written off via concessions from acquisition advisors, and $5 million of the remaining liability will be deferred until payments begin in May 2027.
Curtis additionally noted that vendors, agents, and suppliers helped LENSAR during the acquisition period by granting fee reductions and extended payment terms, which he said should aid the company’s return to a more typical operating cadence.
2025 operational performance: procedure growth and installed base expansion
Despite disruption tied to the pending acquisition—Curtis cited decision-making delays among U.S. customers and a halt in international distributor activity—management emphasized continued growth in procedures and the ALLY footprint.
- Curtis said the ALLY installed base expanded by “nearly 50%” versus year-end 2024, while procedure volume grew “20%+” year-over-year in both the fourth quarter and full year 2025.
- Staab reported fourth-quarter procedure volume increased about 20% year-over-year and full-year procedures grew 22%, surpassing 206,000 globally.
- Staab said LENSAR placed 15 ALLY systems in Q4, bringing the ALLY installed base to “just over 200” systems, up 48% year-over-year.
- Staab said the company’s combined installed base of ALLY and LLS systems grew to approximately 435, up 13%, and LENSAR exited 2025 with a backlog of 13 systems pending installation.
Curtis framed longer-term trends as particularly strong, noting full-year 2025 procedure volumes were up 50% compared with 2023, which he described as the first full year of ALLY’s commercial availability. He also said LENSAR grew U.S. procedure share from 14% to 23.4% by the end of 2025.
Revenue mix shifts toward recurring revenue
Staab reported fourth-quarter revenue of $16 million, a 4% decline year-over-year, which he attributed primarily to lower system sales. He said U.S. ALLY sales were 12 systems in Q4 2025, up one system from the prior-year quarter, while sales outside the U.S. fell to one system from 10 in Q4 2024.
For the full year, Staab said total 2025 revenue increased 9% versus 2024, while recurring revenue increased 15% year-over-year, helping offset weaker system sales. In Q4, recurring revenue rose 17% to $12.7 million, which Staab said annualizes to over $50 million. He said LENSAR ended 2025 with $46.3 million in recurring revenue, up from $40.1 million in 2024.
Curtis said recurring revenue represented 79% of fourth-quarter revenue and described procedure revenue as stable, predictable after installation, and carrying “significantly higher margin than system revenue.” He added that LENSAR systems in the U.S. perform an average of 27% more procedures annually than the national average per laser, which management described as evidence of both share gains and market expansion.
Margins, profitability, and the expense outlook
Staab said fourth-quarter gross margin was $6.9 million, or 43%, compared with 42% in Q4 2024. For the full year, gross margin was 46% versus 48% in 2024, which Staab attributed to inflationary cost increases and tariffs assessed in 2025. He said the company did not pass tariff costs on to customers and forecast gross margin in the 46% to 49% range for fiscal 2026, noting that stronger system sales could pressure the margin percentage even as they benefit recurring revenue growth over time.
Staab also said LENSAR maintained positive adjusted EBITDA for 2025, including $595,000 in adjusted EBITDA in the fourth quarter, which he said indicated operating cash flow positive performance excluding working capital impacts.
However, merger-related costs weighed heavily on quarterly expenses. Staab said Q4 results included approximately $3.5 million in merger-related costs, driving a 51% increase in SG&A to $10.3 million and a 41% increase in total operating expenses to $11.9 million.
Looking ahead, Staab said the company expects cash-based operating expenses in 2026 to rise by “no more than 10%,” with most of the increase devoted to commercial activities. In response to analyst questions, Staab clarified that guidance refers to operating expenses excluding items like amortization and stock-based compensation and is intended as a near-term approach while LENSAR assesses how quickly international distributors reengage.
International reset and sales model considerations
Management repeatedly pointed to international markets as the area most disrupted by acquisition uncertainty. Curtis said ALLY had been available outside the U.S. for roughly seven months when the transaction was announced and that uncertainty over the future distribution landscape caused “a meaningful slowdown” abroad, effectively stopping distributor activity for much of the last nine months of 2025.
In Q&A, Curtis told analysts it could take “several quarters” to reinvigorate international momentum, noting that tender-based purchasing in some markets introduces longer sales cycles and that distributors had been planning for a future without LENSAR. He also said the company may explore additional markets such as Australia and New Zealand, and potentially parts of Latin America, while describing South Korea as unlikely to rebound soon due to reimbursement dynamics.
On U.S. commercialization, Curtis said LENSAR has historically been “somewhere north of 50%” sold systems versus placed systems, but he expects the mix could shift toward a lower percentage of outright sales in the near term. He also described installation and ramp dynamics, saying it typically takes around 60 days post-installation for training and procedures to normalize.
Curtis emphasized that about 50% of new business in the fourth quarter came from “femto-naive” surgeons, which he said expands the overall market but can involve a longer ramp as practices adopt laser workflows and train staff. He also said more than 65% of procedures involve astigmatism management, positioning the company for refractive cataract demand trends.
Closing the call, Curtis said rebuilding momentum will take time but added that the company is “ready to capitalize” on market opportunities as an independent business. “In closing, I just wanna say once again,” Curtis said, “LENSAR is back.”
About LENSAR (NASDAQ:LNSR)
LENSAR, Inc, headquartered in Orlando, Florida, is a medical technology company specializing in advanced laser systems for ophthalmic surgery. Its flagship product, the LENSAR Laser System, combines proprietary three-dimensional imaging with precision-guided femtosecond laser delivery to perform critical steps in cataract procedures, including capsulotomy creation, lens fragmentation and corneal incisions.
Founded in 2005, LENSAR has concentrated its research and development efforts on enhancing surgical accuracy and patient outcomes in cataract treatment.
