Form 6-K - Report of foreign issuer [Rules 13a-16 and 15d-16]

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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13In a-16 OR 15d-16 OF
THE SECURITIES EXCHANGE ACT OF 1934

For the month of October 2024

INMODE LTD.

(Exact name of registrant as specified in its charter)

Tavor Building, Sha’ar Yokneam

P.O. Box 533

Yokneam 2069206 Israel

 

(Address of Principal Executive Offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Form 20-F ☒ Form 40-F ☐ 

 

Indicate by check mark whether the registrant by furnishing the information contained in this form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934:

Yes ☐ No ☒ 

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Results of Operations and Financial Condition

On October 30, 2024, InMode Ltd. announced its third quarter 2024 financial results. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

Legal Proceedings

From time to time, the Company may be subject to legal proceedings and claims in the ordinary course of business. On February 14, 2024, a purported shareholder of the Company filed a putative shareholder class action (the “Securities Class Action”) in the United States District Court for the Central District of California, captioned Cement Masons and Plasterers Local No. 502 Pension Fund v. InMode Ltd. et al., Case No. 2:24-cv-01219, against the Company and certain of its officers and directors. The lawsuit is purportedly brought on behalf of purchasers of the Company’s common stock between June 4, 2021 and October 12, 2023, inclusive. The complaint alleges claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 based on allegedly false or misleading statements related to the Company’s business, operations, sales practices and financial outlook. The lawsuit seeks unspecified damages and other relief. On April 16, 2024, multiple shareholders moved to be appointed lead plaintiff. The Court has not yet made a final determination as to the lead plaintiff. On October 25, 2024, the Court entered an order finding that a group of shareholder funds are the presumptive lead plaintiff, and establishing a process by which others shall have an opportunity to challenge this presumption. The Securities Class Action is in the preliminary stages, and the Company has not yet responded to the complaint. As of the date of this filing, the Company is unable to estimate a range of loss, if any, that could result were there to be an adverse final decision in the Securities Class Action, and an estimated liability has not been recorded in the Company’s financial statements. The defendants intend to deny the allegations of wrongdoing and vigorously defend against the claims in the Securities Class Action.

Exhibit No.		Description of Exhibit
99.1		Press Release dated October 30, 2024

 

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Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	InMode Ltd.
	By: /s/ Moshe Mizrahy
	Moshe Mizrahy
October 30, 2024	Chief Executive Officer

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Exhibit 99.1

InMode Reports Third Quarter 2024 Financial Results; Quarterly GAAP Revenue of $130.2

Million (which consists of $98.3 million of net sales in Q3 and $31.9 million of pre-orders from the

first half of 2024)

YOKNEAM, Israel, October 30, 2024 - InMode Ltd. (Nasdaq: INMD) (“InMode”), a leading global provider of innovative medical technologies, today announced its consolidated financial results for the third quarter ended September 30, 2024.

 

Third Quarter 2024 Highlights:

	●	Quarterly GAAP revenue of $130.2 million (which consists of $98.3 million of net sales in Q3 and $31.9 million of pre-orders from the first half of 2024).
	●	Quarterly revenues from consumables and service of $15.8 million, a decrease of 11% compared to the third quarter of 2023.
	●	GAAP operation income of $48.2 million, *non-GAAP operation income of $52.2 million.
	●	Total cash position of $684.9 million as of September 30, 2024, including cash and cash equivalents, marketable securities, and short-term bank deposits.
	●	Full-year 2024 revenue guidance has been revised to be between $410 million and $420 million, compared to prior guidance of $430 million to $440 million.

U.S. GAAP Results (U.S. dollars in thousands, except for per share data)
	Q3 2024	Q3 2023	Q1-Q3 2024	Q1-Q3 2023
Revenues	$130,232	$123,112	296,965	365,267
Gross Margins	82%	84%	81%	83%
Net Income	$50,990	$46,520	98,504	142,754
Earnings per Diluted Share	$0.65	$0.54	1.19	1.66
*Non-GAAP Results (U.S. dollars in thousands, except for per share data)
	Q3 2024	Q3 2023	Q1-Q3 2024	Q1-Q3 2023
Gross Margins	82%	84%	81%	84%
Net Income	$54,971	$53,084	111,626	160,032
Earnings per Diluted Share	$0.70	$0.61	1.34	1.86

*Please refer to “Use of non-GAAP Financial Measures” below for important information about non-GAAP financial measures. A reconciliation between U.S. GAAP and non-GAAP Statement of Income is provided following the financial statements that are included in this release. Non-GAAP results exclude share-based compensation adjustments.

 

Management Comments

 

"The third quarter presented ongoing challenges for InMode,” said Moshe Mizrahy, Chief Executive Officer. “Macroeconomic conditions led to a decrease in demand for our consumables and new platform sales, while the launch of our latest platforms required extended adjustments to our production lines. Nevertheless, we believe our recent management changes will better align our operations with our strategic plan. We also take pride in our dedicated employees, whose hard work has allowed us to make faster-than-expected progress in fulfilling pre-orders.”

 

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Third Quarter 2024 Financial Results

Total GAAP revenues for the third quarter of 2024 reached $130.2 million (including $31.9 million in revenue from first half of 2024 pre-orders), an increase of 5.8% compared to $123.1 million in the third quarter of 2023.

“Despite continued headwinds in the third quarter, we are pleased to have fulfilled our pre-orders ahead of schedule, allowing us to focus on execution once market demand recovers,” said Yair Malca, Chief Financial Officer.

GAAP and *non-GAAP gross margin for the third quarter of 2024 was 82% compared to a gross margin of 84% for the third quarter of 2023.

GAAP operating margin for the third quarter of 2024 was 37%, compared to an operating margin of 38% in the third quarter of 2023. *Non-GAAP operating margin for the third quarter of 2024 was 40% compared to 43% for the third quarter of 2023. This decrease was primarily attributable to higher sales and marketing expenses, primarily driven by our recent management changes costs, higher commissions, as well as additional investments in trade shows and workshop activities.

 

InMode reported GAAP net income of $51.0 million, or $0.65 per diluted share, in the third quarter of 2024, compared to $46.5 million, or $0.54 per diluted share, in the third quarter of 2023. On a *non-GAAP basis, InMode reported net income of $55.0 million, or $0.70 per diluted share, in the third quarter of 2024, compared to $53.1 million, or $0.61 per diluted share, in the third quarter of 2023.

 

2024 Financial Outlook

 

Management provided an outlook for the full year of 2024 ending December 31, 2024. Based on our current estimates, management expects:

●

Full Year 2024 revenue to be between $410 to $420 million compared to prior guidance of $430 million to $440 million

 

●	*Non-GAAP gross margin between 81% and 82% compared to prior guidance of 82% - 84%

 

●	*Non-GAAP income from operations to be between $140 million and $145 million compared to prior guidance of $150 million to $155 million

 

●	*Non-GAAP earnings per diluted share remains the same as in previous guidance at $1.92 to $1.96 after taking into consideration the estimated shares that will be repurchased as part of the share repurchase programs announced this year

 

This outlook is not a guarantee of future performance, and stockholders should not rely on such forward-looking statements. See “Forward-Looking Statements” for additional information.

 

*Please refer to “Use of non-GAAP Financial Measures” below for important information about non-GAAP financial measures. A reconciliation between U.S. GAAP and non-GAAP Statement of Income is provided following the financial statements that are included in this release. Non-GAAP results exclude share-based compensation adjustments.

 

The Current Situation in Israel

 

Regarding the current situation in Israel, management would like to assure investors that the Company is prioritizing the safety and well-being of its employees, and all its team are safe. However, an inability to promptly receive needed supplies and materials due to the ongoing and unpredictable nature of the conflict in Israel and the surrounding region may adversely impact our ability to commercialize and manufacture our product candidates and products in a timely manner. This could cause several delays and/or issues for our operations, which in turn would have a material adverse impact on our ability to commercialize our product candidates and our financial condition.

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Use of Non-GAAP Financial Measures

 

In addition to InMode’s operating results presented in accordance with GAAP, this release contains certain non-GAAP financial measures including non-GAAP net income, non-GAAP earnings per diluted share, non-GAAP operating margin. Because these measures are used in InMode’s internal analysis of financial and operating performance, management believes they provide investors with greater transparency of its view of InMode’s economic performance. Management also believes the presentation of these measures, when analyzed in conjunction with InMode’s GAAP operating results, allows investors to more effectively evaluate and compare InMode’s performance to that of its peers, although InMode’s presentation of its non-GAAP measures may not be strictly comparable to the similarly titled measures of other companies. Schedules reconciling each of these non-GAAP financial measures are provided as a supplement to this release.

 

Conference Call Information

 

Mr. Moshe Mizrahy, Chief Executive Officer, Dr. Michael Kreindel, Co-Founder and Chief Technology Officer and Mr. Yair Malca, Chief Financial Officer, will host a conference call today, October 30, 2024, at 8:30 a.m. Eastern Time to discuss the third quarter 2024 financial results.

 

The Company encourages participants to pre-register for the conference call using the following link:  

https://dpregister.com/sreg/10193479/fdae439271.

Callers will receive a unique dial-in number upon registration, which enables immediate access to the call. Participants may pre-register at any time, including up to and after the call start time.

For callers who opt out of pre-registration, please dial one of the following teleconferencing numbers. Please begin by placing your call 10 minutes before the conference call commences. If you are unable to connect using the toll-free number, please try the international dial-in number.

U.S. Toll-Free Dial-in Number: 1-833-316-0562

Israel Toll- Free Dial-in Number: 1-80-921-2373

International Dial-in Number: 1-412-317-5736

Webcast URL: https://event.choruscall.com/mediaframe/webcast.html?webcastid=X3HVujVC

At:

8:30 a.m. Eastern Time

5:30 a.m. Pacific Time

The conference call will also be webcast live from a link on InMode's website at https://inmodemd.com/investors/events-presentations/. A replay of the conference call will be available from October 30, 2024, at 12 p.m. Eastern Time to November 13, 2024, at 11:59 p.m. Eastern Time. To access the replay, please dial one of the following numbers: 

Replay Dial-in U.S TOLL-FREE: 1-877-344-7529

Replay Dial-in Canada TOLL-FREE: 855-669-9658

Replay Dial-in TOLL/INTERNATIONAL: 1-412-317-0088

Replay Pin Number: 5305602

To access the replay using an international dial-in number, please select the link below:

https://services.choruscall.com/ccforms/replay.html

A replay of the conference call will also be available for 90 days on InMode's website at https://inmodemd.com/investors/.

About InMode

InMode is a leading global provider of innovative medical technologies. InMode develops, manufactures, and markets devices harnessing novel radio frequency (“RF”) technology. InMode strives to enable new emerging surgical procedures as well as improve existing treatments. InMode has leveraged its medically accepted minimally invasive RF technologies to offer a comprehensive line of products across several categories for plastic surgery, gynecology, dermatology, otolaryngology, and ophthalmology. For more information about InMode, please visit www.inmodemd.com.

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Forward-Looking Statements

The information in this press release includes forward-looking statements within the meaning of the federal securities laws. These statements generally relate to future events or InMode's future financial or operating performance, including the 2024 revenue projection described above. Actual outcomes and results may differ materially from what is expressed or forecast in such forward-looking statements. In some cases, you can identify these statements because they contain words such as "anticipate," "believe," "estimate," "expect," "intend," "may," "plan," "predict," "project," "will," "would" and similar expressions that concern our expectations, strategic plans or intentions. Forward-looking statements are based on management's current expectations and assumptions, and are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Consequently, actual results could differ materially from those indicated in these forward-looking statements. When considering these forward-looking statements, you should keep in mind the risk factors and other cautionary statements included in InMode's Annual Report on Form 20-F filed with the Securities and Exchange Commission on February 13, 2024, and our future public filings. InMode undertakes no obligation and does not intend to update these forward-looking statements to reflect events or circumstances occurring after this press release. You are cautioned not to place undue reliance on these forward-looking statements, which pertain only as of the date of this press release.

 

Company Contact: Yair Malca Chief Financial Officer Phone: [phone] Email: [e-mail]

Investor Relations Contact: Miri Segal MS-IR LLC Email: [e-mail]

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INMODE LTD.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(U.S. dollars in thousands, except for per share data)

(Unaudited)

		Three months ended September 30,								Nine months ended September 30,
		2024				2023				2024				2023
REVENUES			130,232				123,112				296,965				365,267
COST OF REVENUES			24,055				20,136				57,536				60,444
GROSS PROFIT			106,177				102,976				239,429				304,823
OPERATING EXPENSES:
Research and development			3,254				3,268				10,470				9,937
Sales and marketing			51,863				50,819				136,713				143,591
General and administrative			2,799				2,479				7,579				6,879
TOTAL OPERATING EXPENSES			57,916				56,566				154,762				160,407
OPERATIONS INCOME			48,261				46,410				84,667				144,416
Finance income, net			9,918				4,953				26,592				12,687
INCOME BEFORE INCOME TAXES			58,179				51,363				111,259				157,103
INCOME TAXES			7,189				4,843				12,755				14,349
NET INCOME			50,990				46,520				98,504				142,754
EARNINGS PER SHARE:
Basic			0.66				0.56				1.20				1.71
Diluted			0.65				0.54				1.19				1.66
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING USED IN COMPUTATION OF EARNINGS PER SHARE (in thousands)
Basic			77,022				83,703				81,795				83,423
Diluted			77,908				85,970				83,016				85,814

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INMODE LTD.

CONDENSED CONSOLIDATED BALANCE SHEETS

(U.S. dollars in thousands, except for per share data)

(Unaudited)

		September 30, 2024				December 31, 2023
Assets
CURRENT ASSETS:
Cash and cash equivalents			164,838				144,411
Marketable securities			281,458				373,647
Short-term bank deposits			238,592				223,547
Accounts receivable, net of allowance for credit losses			40,777				42,362
Prepaid expense and other receivables			24,447				16,268
Inventories			58,284				45,095
TOTAL CURRENT ASSETS			808,396				845,330
NON-CURRENT ASSETS:
Accounts receivable, net of allowance for credit losses			2,917				3,670
Deferred income tax asset			1,048				1,506
Operating lease right-of-use assets			8,636				9,698
Property and equipment, net			2,336				2,382
Other investments			700				700
TOTAL NON-CURRENT ASSETS			15,637				17,956
TOTAL ASSETS			824,033				863,286
Liabilities and shareholders’ equity
CURRENT LIABILITIES:
Accounts payable			14,313				13,966
Contract liabilities			17,230				10,923
Other liabilities			44,155				39,247
TOTAL CURRENT LIABILITIES			75,698				64,136
NON-CURRENT LIABILITIES:
Contract liabilities			3,318				3,766
Other liabilities			2,808				1,399
Operating lease liabilities			5,317				6,613
TOTAL NON-CURRENT LIABILITIES			11,443				11,778
TOTAL LIABILITIES			87,141				75,914
TOTAL SHAREHOLDERS’ EQUITY			736,892				787,372
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY			824,033				863,286

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INMODE LTD.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(U.S. dollars in thousands, except for per share data)

(Unaudited)

		Three months ended September 30,								Nine months ended September 30,
		2024				2023				2024				2023
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income			50,990				46,520				98,504				142,754
Adjustments required to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			138				129				480				501
Share-based compensation expenses			3,981				6,564				13,122				17,278
Change in allowance for credit losses of trade receivable			130				426				414				665
Loss on marketable securities, net			29				-				170				-
Finance expenses (income), net			3,863				(527	)			(5,934	)			(3,236	)
Deferred income taxes			35				(216	)			(58	)			(154	)
Changes in operating assets and liabilities:
Decrease (increase) in accounts receivable			(2,570	)			(10,753	)			1,924				(16,461	)
Increase in other receivables			(860	)			(1,347	)			(7,577	)			(5,367	)
Increase in inventories			(5,657	)			(1,421	)			(13,189	)			(92	)
Increase (decrease) in accounts payable			(1,235	)			(962	)			347				(3,909	)
Increase (decrease) in other liabilities			11,722				3,040				6,160				(12,792	)
Increase (decrease) in contract liabilities (current and non-current)			(26,517	)			(9	)			5,859				(3,630	)
Net cash provided by operating activities			34,049				41,444				100,222				115,557
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment in short-term deposits			(78,390	)			(138,140	)			(164,687	)			(166,140	)
Proceeds from short-term deposits			138,140				50,590				151,640				85,090
Purchase of fixed assets			(77	)			(149	)			(435	)			(684	)
Purchase of marketable securities			(90,820	)			(60,588	)			(276,513	)			(192,707	)
Proceeds from sale of marketable securities			22,233				-				69,608				-
Proceeds from maturity of marketable securities			122,969				78,465				304,777				190,070
Net cash provided by (used in) investing activities			114,055				(69,822	)			84,390				(84,371	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repurchase of ordinary shares			(76,556	)			-				(165,536	)			-
Exercise of options			565				2,729				1,194				5,229
Net cash provided by (used in) financing activities			(75,991	)			2,729				(164,342	)			5,229
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS			728				(473	)			157				(222	)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS			72,841				(26,122	)			20,427				36,193
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD			91,997				159,855				144,411				97,540
CASH AND CASH EQUIVALENTS AT END OF PERIOD			164,838				133,733				164,838				133,733

Revision of prior period financial information

The Company revised certain items within the investing activities with no impact on the net cash used in investing activities. The items impacted were “Investment in short-term deposits” and “Proceeds from short-term deposits” which were decreased by $41,000 and $119,000 for the three months and nine months ended September 30,2023 respectively and “Purchase of marketable securities” and “Proceeds from maturity of marketable securities” which were decreased by $0, and $40,423 for the three months and nine months ended September 30, 2023.

These changes have no impact on our previously reported consolidated total cash flows from operating activities, financing activities and investing activities in the periods stated above as well as net income and net change in cash and cash equivalents.

The Company evaluated the materiality of the adjustments, individually and in the aggregate, considering both qualitative and quantitative factors, and concluded that it was immaterial to the Company’s prior periods' consolidated financial information. Since the revision was not material to any prior interim period or annual consolidated financial statements, no amendments to previously filed interim or annual periodic financial information was required. Consequently, the Company has revised the historical consolidated financial information presented herein for the impact of the above.

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INMODE LTD.

CONDENSED CONSOLIDATED FINANCIAL HIGHLIGHTS

(U.S. dollars in thousands, except for per share data)

(Unaudited)

		Three months ended September 30,																Nine months ended September 30,
		2024								2023								2024								2023
Revenues by Category:
Capital Equipment revenues - United States			85,734				66	%			67,969				55	%			151,392				51	%			191,548				53	%
Capital Equipment revenues - International			28,662				22	%			37,276				30	%			86,191				29	%			114,284				31	%
Total Capital Equipment revenues			114,396				88	%			105,245				85	%			237,583				80	%			305,832				84	%
Consumables and service revenues			15,836				12	%			17,867				15	%			59,382				20	%			59,435				16	%
Total Revenue			130,232				100	%			123,112				100	%			296,965				100	%			365,267				100	%

		Three months ended September 30,																								Nine months ended September 30,
		2024												2023												2024												2023
		%												%												%												%
		United States				International				Total				United States				International				Total				United States				International				Total				United States				International				Total
Revenues by Technology:
Minimal-Invasive			95				77				90				85				80				83				90				82				88				87				76				83
Hands-Free			4				3				4				11				4				9				7				3				5				10				5				8
Non-Invasive			1				20				6				4				16				8				3				15				7				3				19				9
			100				100				100				100				100				100				100				100				100				100				100				100

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INMODE LTD.

RECONCILIATION OF GAAP CONDENSED CONSOLIDATED STATEMENTS OF

 INCOME TO NON-GAAP CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(U.S. dollars in thousands, except for per share data)

(Unaudited)

		Three months ended September 30, 2024												Three months ended September 30, 2023
		GAAP				Share Based Compensation				Non-GAAP				GAAP				Share Based Compensation				Non-GAAP
REVENUES			130,232				-				130,232				123,112				-				123,112
COST OF REVENUES			24,055				(481	)			23,574				20,136				(572	)			19,564
GROSS PROFIT			106,177				481				106,658				102,976				572				103,548
OPERATING EXPENSES:
Research and development			3,254				(890	)			2,364				3,268				(729	)			2,539
Sales and marketing			51,863				(2,300	)			49,563				50,819				(4,787	)			46,032
General and administrative			2,799				(310	)			2,489				2,479				(476	)			2,003
TOTAL OPERATING EXPENSES			57,916				(3,500	)			54,416				56,566				(5,992	)			50,574
OPERATIONS INCOME			48,261				3,981				52,242				46,410				6,564				52,974
Finance income, net			9,918				-				9,918				4,953				-				4,953
INCOME BEFORE INCOME TAXES			58,179				3,981				62,160				51,363				6,564				57,927
INCOME TAXES			7,189				-				7,189				4,843				-				4,843
NET INCOME			50,990				3,981				54,971				46,520				6,564				53,084
EARNINGS PER SHARE:
Basic			0.66								0.71				0.56								0.63
Diluted			0.65								0.70				0.54								0.61
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING USED IN COMPUTATION OF EARNINGS PER SHARE (in thousands)
Basic			77,022								77,022				83,703								83,703
Diluted			77,908								78,548				85,970								86,333

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		Nine months ended September 30, 2024												Nine months ended September 30, 2023
		GAAP				Share Based Compensation				Non-GAAP				GAAP				Share Based Compensation				Non-GAAP
REVENUES			296,965				-				296,965				365,267				-				365,267
COST OF REVENUES			57,536				(1,361	)			56,175				60,444				(1,473	)			58,971
GROSS PROFIT			239,429				1,361				240,790				304,823				1,473				306,296
OPERATING EXPENSES:
Research and development			10,470				(1,877	)			8,593				9,937				(1,987	)			7,950
Sales and marketing			136,713				(9,007	)			127,706				143,591				(12,556	)			131,035
General and administrative			7,579				(877	)			6,702				6,879				(1,262	)			5,617
TOTAL OPERATING EXPENSES			154,762				(11,761	)			143,001				160,407				(15,805	)			144,602
OPERATIONS INCOME			84,667				13,122				97,789				144,416				17,278				161,694
Finance income, net			26,592				-				26,592				12,687				-				12,687
INCOME BEFORE INCOME TAXES			111,259				13,122				124,381				157,103				17,278				174,381
INCOME TAXES			12,755				-				12,755				14,349				-				14,349
NET INCOME			98,504				13,122				111,626				142,754				17,278				160,032
EARNINGS PER SHARE:
Basic			1.20								1.36				1.71								1.92
Diluted			1.19								1.34				1.66								1.86
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING USED IN COMPUTATION OF EARNINGS PER SHARE (in thousands)
Basic			81,795								81,795				83,423								83,423
Diluted			83,016								83,536				85,814								86,154

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