iRadimed lowers Q3 non-GAAP EPS view to 11c-12c from 23c-24c
Lowers Q3 revenue view to $7.5M-$7.6M from $9.9M-$10.0M. One estimate for Q3 revenue is $3.81M. "While this news is disappointing, I remain encouraged by the higher volume and dollar value of recent quoting activity. However, it is the combination of underestimating sales cycle times resulting from our new sales strategy and the achievement of our long stated goal of reducing backlog that has led to the reduction of our revenue and earnings estimates," said the company. "Our new sales strategy requires our sales team to directly call upon hospital departments outside of radiology and anesthesiology. Thus far, the sales team has done very well at creating initial interest in our pump from these other hospital departments and this is evident in the opportunity and quoting details. However, not having been previously targeted, these other departments have never budgeted for the purchase of an MRI compatible IV pump, which is resulting in an extended sales cycle. To maintain that momentum and convert quotes into purchase orders, we are focused on the continued development of the abilities of our sales team and implementing better sales techniques aimed at closing deals more quickly. Given these developments in the sales cycle, there may be up to approximately $3.2M of Q3 revenue from backlog and approximately $13M of 2016 revenue from backlog. As we anticipate that backlog will not be significant going forward, we feel it is important to consider the reduction in backlog during 2016 when forecasting 2017 revenue. Consistent with our historical practice, we expect to issue 2017 revenue and earnings guidance during the first half of January 2017," said the company.