Menlo Park, Calif. — Eyecare technology company Sight Sciences Inc. (SGHT) experienced a sharp decline of 32% in premarket trading on Tuesday following a revenue warning. The company reported a decrease in the number of new accounts for their Surgical Glaucoma products in the third quarter, citing uncertainty surrounding reimbursement.
Sight Sciences now anticipates third-quarter revenue to range between $19.0 million and $20.0 million, falling short of the $22.9 million consensus predicted by FactSet. The revenue setback can be attributed to local coverage determinations (LCDs) published by five out of seven Medicare Administrative Contractors (MACs) in June. These LCDs categorized various non-implantable micro-invasive glaucoma surgery procedures, including Sight Sciences’ own surgical glaucoma technologies, as investigational and non-covered for Medicare beneficiaries in the corresponding states.
The projected revenue decline also extends to the company’s dry eye sector, where slight sequential dip is expected due to both seasonal factors and a strategic approach aimed at increasing utilization by existing customer accounts as part of the reimbursement strategy.
Paul Badawi, Founder and CEO of Sight Sciences, acknowledged the seasonality patterns in the industry, stating, “We typically see a strong second quarter followed by a slower start to the third quarter.” However, he noted that despite a robust second quarter preceding the LCD proposals, new account additions have been less frequent, and utilization rates have remained relatively stagnant. Furthermore, there has been a lack of expected growth in commercial activity throughout August and early September.
Looking ahead to 2023, Sight Sciences foresees a decline in revenue for the entire year, estimating a range of $80.0 million to $82.0 million. This marks a 12% to 15% decrease from 2022 figures and falls below the FactSet consensus of $90.5 million.
So far this year, Sight Sciences Inc.’s stock has plummeted by 47%, in stark contrast to the 17% increase observed in the S&P 500 index.
