(Reuters) – Align Technology missed Wall Street estimates for third-quarter revenue on Wednesday, on lower-than-expected demand for its clear teeth aligners among younger patients.
Shares of the company were down about 3.9% after the bell.
The Arizona-based company posted third-quarter revenue of $977.9 million, down 4.9% sequentially, missing estimates of $987.34 million, according to data complied by LSEG.
The company also announced a global restructuring plan which would lead to job cuts or transfers for certain identified positions to other locations.
Align expects to spend about $30 million on severance payments in the fourth-quarter.
The company had said in July that it expects clear teeth aligner volume to be down sequentially as a result of third-quarter seasonality. Volumes were down 4% during the quarter.
Leerink Partners analyst Michael Cherny, earlier this month, had said in a note that sentiment towards the dental industry remains largely poor, heading into the third quarter, “driven by both industry pressures and company-specific variables that are limiting any meaningful enthusiasm”.
“As recently reported by many analysts and third-party research firms, the underlying dental market in the U.S. remains sluggish and our doctor customers cite similar trends,” Align CEO Joe Hogan said in a statement.
In July, the company reduced its annual growth forecast due to weak demand. The demand for dental products and surgeries has decreased, as consumers concerned about inflation choose to limit their discretionary spending and prioritize purchase of essential products.
The Invisalign maker expects fourth-quarter global revenue to be in the range of $995 million to $1.02 billion, compared to analysts’ estimates of $1.01 billion.
On an adjusted basis, the company posted a profit of $2.35 per share, compared to estimates of $2.31 per share, according to data compiled by LSEG.
(Reporting by Sneha S K in Bengaluru; Editing by Mohammed Safi Shamsi)
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