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Good afternoon, everyone, and thank you for standing by. Welcome to Evalyst's second quarter 2026 earnings call. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, today's conference call is being rescheduled and webcast live. All participants are in a listen-only mode. After the speaker's remarks, there will be a question and answer session. I would now like to turn the conference over to Narek Saharian, Vice President and Head of Global Vestor Relations in Corporate Communications.

Please go ahead. Thank you.

Thank you, Operator, and welcome to everyone joining us on today's call to review Ellis' second quarter financial results. Our second quarter press release is now available on the investor relations section of our website at eveless.com. Joining me on today's call are David Morissette, President and Chief Executive Officer, Rui Avalar, Chief Medical Officer and Head of R&D, and Tiana Mitchell, Chief Financial Officer. Today's call will include forward-looking Actual results may differ materially due to risks and uncertainties outlined in our earnings, press release, and SEC filings. forward-looking statements are based on current assumptions and we undertake no obligation to update them. Additionally, we will discuss certain non-GAAP financial measures. These measures should be considered in addition to and not as a substitute for our GAAP results. A reconciliation of GAAP to non-GAAP measures is included in today's earnings release.

As a reminder, our earnings release and SEC filings are available on the SEC's website and on our investor relations website. Following the conclusion of today's call, a replay will be available on our website at investors.evalus.com. With that, I'll turn the call over to our CEO, David Modazzetti. Thank you, Nart. And good afternoon, everyone.

The second quarter represents a meaningful inflection point for Evelus. We delivered 21% revenue growth. generated our third consecutive quarter of positive adjusted EBITDA, expanded our international footprint with the launch of ESTEEM in Europe, and announce two strategic licensing agreements that further strengthen our long-term portfolio. Importantly, Evelis gained significant share across the U.S. injectable aesthetics market during the quarter, underscoring the growing momentum of our portfolio strategy across both neurotoxins and hyaluronic acid gels. Reflecting the strength of our first half performance, we also raised our full year 2026 financial outlook. As we enter the second half of the year, we are well positioned to build on this momentum. Consumer demand continued to strengthen during the quarter. Treatment intervals remained stable and practitioners reported healthy patient traffic and engagement.

We estimate the U.S. neurotoxin market grew at a faster-than-expected mid-single-digit growth rate during the quarter, while the hyaluronic acid gel market returned a positive growth following two consecutive years of declines. Consumers continue to prioritize aesthetic treatments, and practices remain focused on products that deliver predictable clinical outcomes and high patient satisfaction. Against this improving backdrop, we continued to meaningfully outpace the market through disciplined commercial execution, which led to market share gains across our portfolio. That execution is evident through our business performance. Global toxin revenue exceeded $75 million during the quarter, driven by double-digit toxin growth across both the United States and our international markets. As our portfolio continues to expand, we're seeing customers increasingly adopt our products within their practices. Portfolio Focus is delivering particularly strong results among accounts participating in our Avalos Portfolio Growth Bundle.

In the first six months since we debuted the program, approximately 70% of these customers purchased Evelisse, compared with approximately 25% penetration of Evelisse across our overall customer base. Javot continues to strengthen its competitive position through growing customer loyalty and market share gains, while Avalis is following the same disciplined commercialization strategy that made Javot successful. During the quarter, Avalis revenue increased by more than $2 million sequentially, reflecting increased customer penetration, reorder rates, and utilization within existing accounts. Together, these trends reinforce our confidence that our portfolio focus is gaining traction, enabling us to increase share across both neurotoxins and injectable hyaluronic acid gels, while deepening customer relationships and expanding our share of wallet. As a result of the continued strength across our portfolio, we remain on track for both Evelisse and our international business to each contribute more than 10% of total company revenue this year. A key milestone in our evolution is our recent partnership with IFSA to exclusively develop and commercialize Profilo in the United States. Profilo is an asset we've been actively pursuing because it represents a gold standard in the rapidly emerging skin quality category.

With the addition of Profilo, Evelis is expanding into a new third injectable aesthetics vertical of skin quality, further diversifying our differentiated portfolio and reinforcing our strategy of building a comprehensive injectable platform. Profilo defines the skin quality category globally and is widely recognized as a market-leading brand for skin quality in Europe. no directly comparable product currently available in the United States. Similar to Jibo, we will own the US regulatory filings and lead the clinical development and commercialization strategy for Profilo, creating long-term value on the asset, has the potential to generate more than $100 million in peak annual revenue. More broadly, our partnership with companies such as Ipsa, Cimetase, and Daewoong demonstrate that leading global innovators increasingly view Evalys as a partner of choice to develop and commercialize quality aesthetic products. proven execution, deep customer relationships, and expanding global platform position us to continue attracting high-quality assets from world-class partners as we build the next generation of injectable aesthetics. Our international business is also becoming an increasingly important contributor to our long-term strategy. During the quarter, we successfully launched the esteemed collection of injectable hyaluronic acid gels in Europe. where early customer response has been very encouraging. We also announced the expansion of our relationship with Cimetase to include Canada, Australia, and New Zealand.

Strategically, this is an important milestone as we now hold exclusive rights to commercialize our injectable hyaluronic acid gel portfolio in every market where we maintain rights for Nuseva, while expanding our global addressable market by approximately 200 million annually. The combination of a broader portfolio and expanded geographical footprint make our international business an increasingly meaningful contributor to our long-term growth and revenue outlook. While we continue to invest in our long-term growth strategy, we remain disciplined in our financial execution. Our third consecutive quarter of positive adjusted EBITDA demonstrates that we can deliver profitable growth while funding the strategic initiatives that will drive the next phase of our evolution. Through the first six months of the year, we delivered 14% revenue growth ahead of the pace implied in our original guidance, giving us the confidence to raise our full year 2026 financial outlook. Our results this quarter reflect the strength of our expanding portfolio, the effectiveness of our commercial strategy, and the operating discipline of our team in executing against our long-term objectives. With that, I'd like to now turn the call over to Rui.

Thank you, David.

Evans is committed to building a best-in-class aesthetic portfolio. We started with Javeau, a neurotoxin manufactured under the high-pure manufacturing process supported by Phase III data against the industry standard that was subsequently validated by an independent study demonstrating that Javeau had a fast onset, the highest peak effect, and the longest duration among the toxins tested. Then we brought in Nevelis, a hyaluronic acid injectable manufactured with a novel cold X cross-linking technology. The pivotal registration studies demonstrated both non-inferiority and statistical superiority against an established comparator. The first two HA products, I believe Form and Smooth, have launched. Sculpt, our premium mid-face HA injectable, has an anticipated approval in the fourth quarter and is expected to commercially launch in 2027. Evelisse Lips is on track to be submitted to the FDA by the end of this year with an anticipated launch in 2028.

Recently, we further expanded our portfolio and are very excited about the partnership with IPSA, the developer of Profilo. IPSA is a private Swiss multinational pharmaceutical company founded in 1945 and operates across 10 therapeutic areas in over 90 countries worldwide. Profilo is made of a unique blend of high and low molecular weight hyaluronic acid. And instead of the traditional cross-linking, it undergoes a patented thermal production process to create a hybrid matrix designed to address skin quality. age, the components of skin break down and becomes less dynamic. Profilo helps rebuild the quality of the skin. It stimulates extracellular remodeling, improves the elasticity of the skin and its supporting function by stimulating fibroblasts and keratinocytes. Evelis will lead the U.S. clinical and regulatory approval process and then own the PMA.

At this time, we anticipate approval around 2030 and will provide updates as the program progresses. With the addition of Profilo, we continue to expand our portfolio and expect to introduce three new products over the next four years. Lastly, as David mentioned, we have further expanded our geographical reach with esteem and now also have Canada, Australia and New Zealand. the registration timelines we expect to launch in these regions in 2028. With that, I'll turn the call over to Tatjana.

Thank you, Rui. The second quarter represented another strong step forward in the execution of our financial strategy. As I approach one year as CFO, I am proud of the foundation we have set and our proven ability to deliver double-digit revenue growth across the portfolio while driving significant operating leverage and profitability. In the second quarter, we posted revenue growth above 20%, delivered our third consecutive quarter of positive adjusted EBITDA, and strengthened our confidence in Outlook for the remainder of the year. We achieved these results while continuing to invest in customer experience and education, consumer rewards, and the launch of the Esteem portfolio in Europe. Beginning with revenue, our global net revenue for the second quarter was $84.1 million, representing an increase of 21% compared to the prior year. This performance reflects continued strength across our diversified portfolio, with global toxin revenue of $75.2 million and injectable hyaluronic acid gel revenue of $8.9 million. As expected, the recent launch of a steam in Europe contributed modestly during the second quarter.

From a geographic standpoint, we continue to see balanced performance across both our U.S. and international business. Jouveau and Nesteva delivered another quarter of healthy growth, supported by improving procedure volumes and continued market share gains. Idle Evelisse continued to build momentum through increasing customer adoption and reorder behavior. Turning to gross margin, reported gross margin for the second quarter was 68%, while adjusted gross margin, which excludes the amortization of intangibles, was 69%. Gross margin benefited by approximately 120 basis points from a tariff refund recognized during the quarter. Adjusting for the tariff refund, our first half gross margin remained flat year over year. reflecting a modest improvement in U.S. gross margin that was offset by a higher mix of our international business. Moving to operating expenses. GAAP operating expenses for the second quarter were 61.7 million compared to 55.7 million in the first quarter.

Non-GAAP operating expenses for the second quarter were $53.3 million, compared to $49.1 million in the first quarter. As expected, operating expenses increased sequentially from the first quarter as we continued to invest in customer education, marketing programs, and international portfolio expansion. These investments remain very disciplined, allowing us to efficiently scale the business while maintaining our profitability objectives. As a reminder, non-GAAP operating expenses exclude stock-based compensation, revaluation of the contingent's royalty obligation, and depreciation and amortization. Within operating expenses, selling general and administrative expenses for the second quarter were $57.1 million compared to $52 million in the first quarter. This included $5.2 million of non-cash stock-based compensation, similar to the prior quarter. In the second quarter, our adjusted EBITDA improved by $12.6 million compared to the prior year period, resulting in positive adjusted EBITDA of $4.7 million and marking our third consecutive quarter with positive adjusted EBITDA.

As we've discussed, our commercial infrastructure was intentionally built to support a broader portfolio. As additional products contribute to revenue, we expect that scalability to become increasingly evident through improving profitability. Turning to the balance sheet, we ended the quarter with $45.2 million in cash and cash equivalents, compared to $49.8 million at the end of the first quarter. Cash used during the quarter primarily reflected interest expense and planned capital expenditure investments. We believe that our cash position, profitability trajectory, and the capacity under our revolving credit facility ample financial flexibility to support our commercial priorities, invest in portfolio expansion, and execute on our long-term growth strategy. We continue to have access to $100 million of additional liquidity under our Pharmacon debt facility. is intended for potential transformative business investments. As we've said previously, we remain funded to profitability and do not anticipate the need for additional equity financing.

Another important point regarding the balance sheet. While our position on the announced tariffs remains unchanged, as with the prudent measure, we expect to bring approximately one year's worth of Chivot inventory into the U.S. we will effectively be relocating Zhigou safety stock from South Korea to the U.S. This will be reflected as an increase in inventory and an increase in accounts payable on our balance sheet, but will not impact our cash use, given the negotiated payment terms. Turning now to guidance. Our first half performance provides us with increased confidence in the trajectory of the business. As a result, we are updating our full-year 2026 financial outlook. Through the first six months of 2026, we delivered 14% year-over-year growth in revenue, exceeding the pace implied by our original four-year outlook. we are raising the lower end of our revenue guidance to 330 million, while maintaining the upper end of 337 million, effectively raising the midpoint of our guidance range to 333.5 million. We are also raising our full-year adjusted gross profit margin guidance. between 67.0 and 67.5%.

This reflects our first top performance in confidence in the margin trajectory of the business. We are narrowing our non-GAAP operating expense guidance range to between $212 million to $216 million. This reflects our continued disciplined approach to expense management while incorporating incremental strategic investments. including upfront payments for the recently announced expansion of our esteemed partnership into Canada, Australia, and New Zealand. Our previously announced partnership with IPSA reflects the same disciplined, capital-efficient approach to business development, with no upfront or milestone payments. As a result, we are reaffirming our low-to-mid single-digit adjusted EBITDA margin outlook for the full year 2026. Finally, I'd like to emphasize that our long-term financial framework remains unchanged. We continue to believe Evelis is well positioned to achieve $450 million to $500 million in annual revenue and 13% to 15% adjusted EBITDA margin in 2028.

The progress we have demonstrated over the past three quarters reinforces our confidence that we're on track to achieve these long-term objectives.

With that, I'll turn it back to David for closing remarks. Thank you, Tatiana. As you heard today, ELVIS is on track to deliver our seventh consecutive year of above-market performance double-digit top-line growth and we've continued to gain market share for both Javeau and Evelisse I'm particularly pleased with the debut and early success of our portfolio growth bundle, which resulted in customers committing more of their injectable business to Avalos and driving the highest overall growth across our customer base. Over the past 18 months, we have transformed Evalys into a diversified injectable aesthetics company with three distinct growth verticals. We began by establishing Javot as one of the fastest growing neurotoxin brands in the market. We continued that momentum with the launch of Evelisse, the first new injectable hyaluronic acid gel in more than a decade. and most recently entered the skin quality space with Profilo. At the same time, we've built a commercial platform that is increasingly scalable, increasingly diversified, and increasingly attractive to both customers and strategic partners. Before I close, I want to thank our employees for their relentless focus on execution.

I also want to thank our customers for their continued trust in Evalus and our strategic partners for their collaboration. and last, in Evelis. Our progress this quarter reflects what we can accomplish when we work together with a shared commitment to innovation, operational excellence, and delivering long-term value. Operator, you may now begin the Q&A.

Thank you. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. And for participants using speaker equipment, it may be necessary to pick up your handset before you ask a question. for pressing the star keys. Our first question is from Annabel Samimi with Stifo. Please proceed.

Hi, guys. Thanks for taking my question. Congratulations on a good quarter. I'm really interested in your new licensing of Profilo for skin quality. As usual, U.S. is catching up with international markets. I want to understand this product a little better. What is it going to require clinically to get on the market here? Do you still expect to maintain profitability with the additional R&D here? And second, would you – view this maybe I guess a little bit more like a filler light to perhaps expand a category or be a sort of gateway into fillers, or is this a completely different market, different price point, different commitment altogether?.

Great Annabel, thanks for the questions. I'll have Rui comment on the clinical development and then Tatiana comment on the expense associated with Profilo. I'll just open with this last weekend we had an advisory board meeting with a number of key customers from both the US and international markets. Interestingly, the US doctors were all very well aware of Profilo. They've heard of this brand because it's well known as the gold standard for skin quality. And the international doctors made a simple comment. They use toxins to relax muscle.

You use our injectable hyaluronic acid gels like Evalis to replace lost volume in the tissue. And products like Profilo are used as more like a moisturizer on the skin surface. So it's not adding volume, it's changing the overall texture of the skin. So I'll let Rui talk a little bit more about clinical development and what you would see going on. Sure, maybe I'll touch on kind of what you also touched on. It is a different product. When we think about HAs,.

mechanism of action is they take up space. That's why they're regulated as a device. This is a different way of actually creating an HA gel. As I mentioned, it doesn't undergo the traditional cross-linking. It has like a special thermal process and you end up with these light hydrogen bonds. And what it does is it actually hydrates the skin internally. So what you do is you actually put it in.

And if you look at kind of the DFU from Europe, you can actually see where the injection points are correlate where the skin quality is deteriorating. The skin turgurs low, there's kind of more redundancy and looseness in even the skin tone is low. Those are all components of skin quality, and this is what this works on. So, mechanistically, it works effectively by hydrating the skin from within. In terms of the process and how we get it through, this will be a full PMA. It's considered a class three device, and it will go through a full PMA process, which is where we kind of tie in those timelines. So we're talking about 2030 right now.

I think I've captured most of your components, Annabelle. Great. And maybe I will add. All right.

Go ahead. I will just add on the question around, does this impact profitability? And the short answer is no. Roo and his team have a great track record and will be supporting the clinical development and regulatory approval of this product. this is already contemplated in our guidance for just to be adopted 2028 of 13 to 15%. Got it.

And if I could just ask a follow-up, can you talk about, I mean, I heard in your comments how you're feeling about the state of the filler market. It does look like we've got a bit of a tale of two cities here with, you know, I guess one player seeing declines, another player seeing stabilization. What are you seeing as far as interest levels and I guess being a new player on the market, do you feel like you're reframing the conversation around fillers right now and any impact that you're seeing yet from GLP-1s? I know that Galdorma is starting to talk about it, so how are you seeing that play out in the market?.

Yes, this is David. Overall, we're hearing improving conditions from clinicians all around in the HA market specifically. In our cases, you saw the step up in Q2. Part of that was driven by our ability to talk about these weight loss patients, and we've incorporated that into our co-op. We saw a lot of interest from accounts that want to capitalize on what they're seeing, which is the increasing number of patients coming into their clinics and the ability to advertise to that segment with and the mention of weight loss that we currently have in our patient label. So we've been able to capitalize on it. We do have a lot of interest in that segment. believe it's a very early innings of both the market recovery and that GLP patient entering clinics, but that's exactly where these practices are focused, and that's something we'll continue to take advantage of as we get into the back half of the year, as that's a unique differentiation in the Evelisse line from a consumer standpoint.

Great, thank you. Our next question is from Mark Goodman with Learing Partners. Please proceed.

Yes, just one additional question on this profilo. Is it safe to use that product at the same time as a filler and at the same time as Juveau? I'm just wondering if you need studies to kind of show that it's safe, or is it just going to be well understood by the doctors? And then the second question is just on the performance of the toxin model. just throughout the quarter. Was it improving throughout the quarter and like July is a continuation of that improvement? Was it kind of steady throughout the, I'm just trying to get a sense of like, what has been going on this year? I think you said at the first quarter you thought that the market grew low to mid, and now you're saying the second quarter was mid. So it does feel like it's getting better as time goes on. Just wondering if you're seeing that improvement into July as well. Thanks. Thank you.

Well, I mark, I'll start with your question. Yes. When you look at where this is used, they're you simultaneously with the other products. So this product is put into, if you will, more superficially in the skin. If we think about how it works, if you look at a toxin that usually goes into a muscle, so it's a different layer. And generally, when you're using an HA injectable and you're trying to take up space for a wrinkle or fold, that's usually put in a different plane. So we see them used quite similarly. And then if we think about, you know, part of the reason why there was a lot of excitement here in the U.S. as we had our advisory board is they really like the concept of the cadence of the sprays. product.

It brings patients in with another excuse to get a treatment, and then it helps them with kind of managing, you know, the other treatments such as aging injectables and toxins. So, it's a very synergistic treatment for all the stuff that we currently offer.

That's right. As a matter of fact, when we had conversations with the team at Profilo, they did not view hyaluronic acid injectable products as competitors. They very much viewed them as complementary in the European market and had a lot of success with that. And then go to your second question, Mark. We saw a sequential improvement in the market. You see that reflected in both technology. toxin procedures, NHAs turning to positive growth. Underneath that, we're also seeing that segments of the consumer are also strengthening and that younger demographic, which is well into her 40s now, the millennial, the Gen Z, they both show that their spend on beauty and healthcare only rising, and we do believe that contributes. And we expect that to carry forward into the back half of the year.

So we have no reason to believe that the momentum doesn't continue, and that's reflected in the guidance that we've provided.

Thanks. Our next question is from Navantai with BNB Paribas Asset Management. Please proceed.

Hi. Question on your market commentary, which sounded more positive than the market leaders. So can you clarify whether the comments are U.S. or global for toxins and fillers? And if possible, can you let us know? know your current US and global market shares in toxins and figures and what drove the significant share gains. Thank you.

Sure. As far as the two markets, we've seen Europe Over the past several years, we did not see a slowdown. And coming into this year, we continue to see a healthy market environment. Now, HAs, of course, in both US and Europe did see a dip. And in both markets, we're seeing an improvement. hard for us to gauge whether Europe is in positive growth or in some stage of improvement, but it is consistently the same messaging that we hear back from clinicians that they see the HA market strengthening off of several years of the market being depressed. So we feel good that these markets are moving, let's call it roughly in parallel with one another. And then as it relates to shares, you know, we entered the year with roughly mid-teens market share. We expect to continue in that mid-teens range.

It's hard to pin a share on an exact quarter, but clearly our share is strengthening. We see that in the numbers reflected. Year-to-date, our business growing at a healthy double-digit clip in the U.S. and the same is the case on the on the filler side now in Europe on the on the toxin side, we've just reestablished a position in a couple of major markets in Europe. So it's too early for us to be giving a view on share. Although we do say that in the UK, which is our most established market, this year we are getting really close to that double digit market share, which is an important metric for us that we continue to track as they were the lead market to enter inside of Europe and the UK. So that continues to be a strong market lead for us. And we're seeing the markets that followed after UK continue to strengthen in terms of their revenue.

And that's why the international business has been such an important growth driver for us.

Thank you. Our next question is from Doug Sao with HC Wainwright.

Hi, good afternoon. Thanks for taking the questions. Just maybe trying to understand we're seeing, or maybe if you could help us understand how you think the Evelisse line sort of growth should go. We've obviously seen some nice sequential growth on percent basis. It's still off a relatively smaller base. Just given some of the macro dynamics, I know you've sort of guided to 10% to 12% of the total revenues for this year. Do you see 2027 as being a more important year just with the additions of new products to the portfolio? Thank you.

Yes, well, Doug, I think the way we look at that lease line is it's a very important part of building out a portfolio strategy that we've competed as a single product up until the second quarter of last year for six consecutive years and established a meaningful presence in the aesthetic space on that single product. product, Avalis is clearly opening the door for us to go into clinics and have a deeper partnership with them. As a matter of fact, when we look at accounts that purchase both Jibo and Avalis together, they're purchasing two and a half times greater volume year-to-date than accounts that are only purchasing one product. So clearly, Avalis is a an important next stage in us telling the portfolio story, but that's not it. The announcement of Profilo has added another dimension to the conversations we're having with clinicians because that signals even further growth investment into the category and developing new innovation. And then between now and Profilo, as you know, we have the upcoming approval of Sculpt, which we do believe is a flagship product in that line. It puts us in a place where we can compete against the broader portfolios of the larger established players. In addition to that, the following year, expect to improve the lip product.

So when I look at our pipeline over the next four years, we're going to introduce three more new products. So I'm really excited about what we're going to be able to bring customers over the coming years, but more importantly, we've got to execute in the near term. And I think the operating leverage we've been able to demonstrate without compromising growth is the reason why we've been able.

grow double digits in both the U.S. and international. And, David, just as a follow-up on the Profilo question, sort of bringing that into the portfolio. You had spoken for some time about being interested in biostimulators and I guess Porphyllo is kind of a biostimulator. So do you see that as sort of filling that sort of interest that you had, or do you think that you might still be looking at the biostimulator space as something that might be interesting from a product standpoint? Or are there other products that you could see that could be complementary to ProfiOL?.

I'll jump in on that one, Doug. What we've been talking about in particular on the R&D front and business development front are three big categories. One was skin quality, and we put that in its own category. That's Profilo. The other one that we've talked about that we have high interest in is Hair. which of course is a separate category. And then the third one, and we put it in its own category as we think about mechanistically, is biostimulators. So we've really highlighted three of them. One, we just checked that box, and then the other two we continue to work on.

Okay, great. Thank you so much. Our next question is from Sam Eiler with U.S. Bank Corp. BTIG. Please proceed.

Hi, good afternoon, thanks for taking the questions here. Just to start out, it's a little bit of a higher level question, but you're ramping on Evalis in the US. expanding OUS with the new CIMITASE agreement, you signed this Profilo agreement. Maybe just talk about your ability to execute against all of these initiatives and your own bandwidth.

particularly when it comes to still achieving your profitability targets? Yes, so maybe I'll divide that up and let both Tatiana and Rui comment on it. So I think when you talk about our ability to execute, I think about it on three levels. One is our ability to commercially execute. And then the second part is, can we get these drugs through the development program? And then lastly, how do we fund them? all collectively as you think about our long-term outlook. I'll just start with commercial execution before Rui gets in the pipeline. Look, we've got a great commercial team. You've seen the performance on Avalisa in its first year in what's been a challenged HA market, and we've been the fastest share gainer in that space with that product.

And we still have several more to go. But the cadence of these approvals that we expect put us in a really strong position. As I mentioned earlier, as you think about the next four years, you're talking about three product launches over that time window that are all facial injectable products that drop into the same bag that are injected by the same clinicians. So in our view,.

it only strengthens our message in front of the customer to continue to have that cadence of new products to build around our portfolio strategy. Now let Rui talk about the development pathways. Yes, and, you know, your question was really aimed at how to remanage the development pathways and et cetera. And I think David's comments are kind of fitting also for R&D. There's a cadence. If we look at Sculpt, hopefully that's towards the end of its process. Lips is in a different part of the development. Profile is in a different part of the development.

And then if we can execute on some of the other deals, like we were saying, Hair, for instance, they're all in different parts of development. And if we look at our internal capabilities, we have a really skilled group that focuses on late stage. development. That's a lot of our expertise. So all of this really fits in our wheelhouse. So we think looking at the cadence of the things that we're targeting, we're able to maintain kind of our expenses, at least on the R&D side, kind of just as we've suggested and shared with you previously. Yes. And maybe I'll chime in to the.

last part of your question, Sam. So we had talked about 2025 really being an investment year. And in 2025, we really set up our commercial infrastructure, both in the United States and internationally to sell the portfolio, and that's really important. We have great talent in that commercial organization, who we just talked about about his team. Similar comment, right? We have great talent and a great track record there in terms of taking these assets through their development journey. And in terms of our capital efficiency, you just heard us talking about expansion geography with CIMITES. We talked about the IPSA deal, very capital efficient.

So across the board, whether it's balance sheet or we're looking at our OPEX, we feel very confident in being able to deliver on this.

pipeline here and more. Okay, really helpful there. Maybe if I could just squeeze in a follow-up here. on the second half outlook and how we should be thinking about cadence, any seasonality.

in terms of modeling considerations for the toxin business. Thank you. Yes. So we have modeled our outlook really looking at the sequential step ups and step downs that you would see seasonally in the industry. So we grew 14% in the first half. We're giving this guidance right where we're sort of up the midpoint of the revenue a bit. And what you see there is just really our confidence in the second half following through the same approach. If you look at the year over year growth rates, I would just remind you last year in H1, in the first half we grew high single digits. And then in the second half we stabilized, we were 14% growth, right? So just those columns I would consider when you think about our second half guide.

Our next question is from Serge Belander with.

Needham & Company, please proceed. Hi, this is John on for surge today. Congrats on the quarter and thanks for taking our questions. So first I wanted to kind of follow up on the last question and look to the second half of the year. You guys are coming off a solid first half and updating your full year guidance. So for the second half, it kind of applies, over 10% growth there. So curious of any specific initiatives you guys have planned for the seasonally important second half, you know, whether that's through Evelis Rewards or digital marketing, GLP-1 related messaging, and so on, and how we should kind of think about the impact of these programs on revenue growth this year. And then, Tatiana, you touched on the topic of tariffs in your prepared remarks.

If you would just clarify whether toxins still remain exempt at this time, and similarly with the HAs, I believe they had been subject to 10% tariffs previously. So curious if anything has changed there and what your outlook is.

Thanks. Great. I'll just touch on our back half views at a high level. First is the back half is as important as the front half is. As you can imagine, given the scale of the organization, we have heavy investment in marketing, education, and promotional activities every quarter. As a matter of fact, this year we'll train over 14,000 clinicians hands-on, and that continues each and every quarter. And education is a critical part of driving that confidence gap. Our consumer loyalty team has done a really effective job of not just maintaining patients coming back, but recruiting new patients into the category. And our co-branded media is a great complement to helping advertise and recruit some of those patients where our clinics will advertise both our Avalos Rewards Program as well as the brands in a lot of their co-branded media.

So I would say the mix of all of our investment is complementary in order to continue to drive fast growth with the accounts that partner with us. And as you said with Evelisse, that GLP-1 target is a key strategic area of focus for us. It's one that worked very well in the second quarter, and it's one that we're going to focus on in the back half of the year as well. And then lastly, you know, fourth quarter is the heavy promotional season of the year for our category. So we collaborate. with beauty brands. We've done it multiple times in the past, and we'll do that again in the back half of the year. That's something our accounts really look forward to when they can offer a consumer a gift with purchase.

And we also do something unique each year around 11th day that we've supported now for seven consecutive years. So I know our customers get excited about that, want to learn more about it, we'll introduce those as well. But it's part of our overall cadence. There's nothing unique in there that would present any unique dynamics from a financial standpoint. It's just part of our operating model.

Great. And on the tariffs, our position there remains the same. I think you mentioned for Evalis that has been subject to a 10% tariff and continues to be, and Giroux at this time is still exempt. There is a pronouncement regarding patented pharmaceutical tariffs. And as we await clarity on that, we are prudently bringing in some inventory into the US and we have in a mechanism with our partner there so that it is not going to impact our cash use.

There are no further calls at this time. We have reached the end of our call. You may now disconnect your lines, and thank you for your participation.

This live transcript is auto-generated without human intervention or review.

[Call has ended.]

Good afternoon, everyone, and thank you for standing by. Welcome to Evolus First Quarter Earnings Conference Call. [Operator Instructions] As a reminder, today's conference is being recorded and webcast live. [Operator Instructions]

I would now like to turn the conference over to Nareg Sagherian, Vice President, Head of Investor Relations and Corporate Communications. Please go ahead.

Thank you, operator, and welcome to everyone joining us on today's call to review Evolus' first quarter financial results. Our first quarter press release is now on our website at evolus.com. With me today are David Moatazedi, President and Chief Executive Officer; Tatjana Mitchell, Chief Financial Officer; and Rui Avelar, Chief Medical Officer and Head of R&D, is also with us for the Q&A portion of the call.

Today's call will include forward-looking statements. Actual results may differ materially due to risks and uncertainties outlined in our earnings press release and SEC filings. These forward-looking statements are based on current assumptions, and we undertake no obligation to update them. Additionally, we will discuss certain non-GAAP financial measures. These measures should be considered in addition to and not as a substitute for our GAAP results. A reconciliation of GAAP to non-GAAP measures is included in today's earnings release. As a reminder, our earnings release and SEC filings are available on the SEC's website and on our Investor Relations website. Following the conclusion of today's call, a replay will be available on our website at investors.evolus.com.

With that, I'll turn the call over to our CEO, David Moatazedi.

Thank you, Nareg, and good afternoon, everyone. We started 2026 with strong momentum that carried over from the fourth quarter, resulting in our second consecutive quarter of positive adjusted EBITDA. Importantly, we achieved this in what is seasonally our lowest revenue quarter of the year and against our strongest prior year comparison. We view this as a clear validation of both the strength of the business and the benefits from the structural improvements we implemented in 2025. At a market level, we are encouraged by what we are seeing across the category with industry data and commentary signaling a global aesthetics market that remains healthy with continued growth and strong consumer engagement.

We estimate that in the first quarter, the U.S. toxin market grew in the low to mid-single digits, while the filler market demonstrated continued improvement and was flat to slightly down. Against that backdrop, we maintained our Jeuveau U.S. market share at 14% and delivered share gains with Evolysse, reflecting continued strong performance driven by execution and a differentiated commercial model.

This is an important inflection point for Evolus. Over the past year, we took deliberate actions to align our cost structure with the scale of the business and positioned the company for sustained profitability. The results we are delivering today reflect that work. We are now demonstrating that we can drive profitable growth while continuing to invest in our -- in expanding our portfolio.

To start the year, we are tracking ahead of our operating profit assumptions, giving us the optionality to invest into growth-driving initiatives in the back half of the year. As we look ahead, our strategy is consistent and focused on building a scaled multiproduct aesthetics company, supported by a differentiated and increasingly durable business model. Our long-term outlook through 2028 is grounded in executing our playbook each quarter, expanding account coverage, improving field productivity, deepening relationships with practices and consistently converting demand into repeat purchasing across the portfolio.

A key element of our differentiation, which has enabled us to achieve mid-teens market share for Jeuveau is the competitive moat we have established through our performance beauty platform. At the foundation is our cash pay model and ability to deliver a fully integrated experience for both customers and consumers. Unlike traditional models, our leading digital ecosystem connects the entire platform from practice engagement and product ordering to consumer acquisition, loyalty and repeat utilization, creating a level of connectivity and efficiency that is difficult to replicate and continues to drive repeat usage and momentum across the business.

This platform is now powered to drive the portfolio bundle benefits. And with international growth on a steady rise, the upcoming launch of Estyme in Europe this quarter and additional pipeline milestones ahead, we believe this differentiated commercial structure positions us to scale efficiently and execute with greater precision. At the same time, we are increasingly leveraging our digital ecosystem to drive efficiency and scale across the organization.

Over the past year, we have embedded AI into core areas of the business and we are now seeing those actions translate into tangible results. Our unified data platform allows us to connect insights across the commercial organization, enabling more targeted engagement, improved field productivity and faster decision-making. What makes us particularly powerful is how tightly integrated these capabilities are within our operating model.

Our commercial platform, including Evolus Rewards, practice engagement tools and ordering systems create a continuous data loop that feeds directly into our AI capabilities. This allows our field organization to operate with greater precision and effectiveness with real-time insights at their fingertips that support everything from customer targeting to conversion.

Turning to the business. Underlying demand remains healthy and consistent with the momentum we exited 2025. In addition to the customer expansion and strong reorder rates, we are seeing increasing traction from our portfolio bundling strategy. We are encouraged by the progress and momentum we are seeing across our accounts as customers adopt a more integrated approach to our portfolio. Given this is a structured 6-month program, we look forward to providing a more comprehensive update following the second quarter.

Importantly, this is a key driver of both growth and profitability. As a more streamlined organization, these capabilities allow us to scale the business more efficiently, which is a meaningful contributor to the operating leverage and profitability we are now delivering. This is not a trade-off between growth and efficiency. It's a reflection of a more intelligent and scalable model and a clear point of differentiation versus traditional approaches in the category.

Looking at our key performance indicators, they reinforce both the quality and demand scalability of our commercial model. We're continuing to broaden our reach across practices. Total purchasing accounts increased by nearly 500 in the first quarter. And since launch, more than 18,000 customers have purchased from Evolus, including approximately 3,500 for Evolysse. U.S. account penetration is now above 60%. Reorder rates remain approximately 71% and Evolus Rewards continues to expand, approaching 1.5 million members, up 27% year-over-year, with redemptions exceeding 255,000 in the quarter. These metrics reflect strong engagement and support our ability to translate demand into increasingly consistent financial performance.

On Jeuveau, we continue to see a brand that's building. In the first quarter, Jeuveau delivered $66.4 million in global revenue with positive unit growth and pricing stability across both U.S. and international markets. While reported revenue reflects normal seasonality and prior year timing dynamics, underlying demand remains intact. As we move through the first half of 2026, we expect to wrap around those dynamics from early 2025, resulting in high single-digit growth for Jeuveau over that period.

Beyond Jeuveau, our next phase of growth is being driven by portfolio expansion and increasing share of wallet within our accounts. In the U.S., Evolysse is increasing our relevance with customers and contributing to an evolving revenue mix as we apply the same playbook that drove Jeuveau's success, education, training and disciplined scale. Just this past weekend, we hosted 50 customers for a training program on our injectable products and the feedback on Evolysse was incredibly positive.

We are seeing accounts repurchasing at higher volumes as they gain confidence in the uniqueness of the product benefits. The excitement is also building around the upcoming FDA milestone for Sculpt, which further completes our RHA portfolio and puts us in a strengthened competitive position against the RHA market-leading companies. As previously stated, we expect to gain FDA approval for Sculpt in the fourth quarter of this year.

Internationally, we are extending that strategy with the mid-May launch of Estyme in Europe, expanding our addressable market and building on the commercial foundation we've established with Nuceiva. In Europe, we have the opportunity to introduce a full line of Estyme products, including the flagship Sculpt Mid-Face product, along with the U.S. approved Smooth and Form products and the Estyme Lips product, which is currently in U.S. FDA trials. The market learnings from these products in Europe will further support our launch strategy in the U.S.

We also continue to take a disciplined approach to expanding our innovation pipeline. We are continuing to actively evaluate and pursue targeted capital-efficient opportunities that complement our portfolio and leverage our existing commercial infrastructure. This is a natural extension of our strategy, an important component of our long-term growth and positions us well to continue building a differentiated multiproduct platform.

Stepping back, our priorities are clear. We're focused on executing our plan, maintaining discipline across our cost structure and investing in catalysts that will drive our next phase of growth. We are well capitalized to support existing business growth and invest in pipeline opportunities. Based on our performance in the first quarter, we are reiterating our full year outlook and remain confident in our ability to deliver double-digit revenue growth and achieve full year adjusted EBITDA profitability in 2026.

With that, I'll turn the call over to Tatjana to walk through the first quarter financial results and our outlook.

Thank you, David. Our first quarter results reflect meaningful progress towards full year adjusted EBITDA profitability. We are executing against our revenue plan while maintaining the expense discipline we established in 2025, and we are seeing the benefits of that structure flow through and expand our operating leverage over the course of 2026.

For Q1, global net revenue was $73.1 million, representing a 7% increase over the prior year. This included $66.4 million of global Jeuveau revenue and $6.7 million from Evolysse. On Jeuveau, units increased in both the U.S. and international markets, reflecting healthy underlying demand. In the U.S., there were onetime revenue deferral dynamics that benefited the first quarter of 2025 and created a headwind in the first quarter of 2026. We expect second quarter U.S. Jeuveau net revenue growth to more than offset the first quarter decline. For the first half of 2026, our guidance implies high single-digit year-over-year growth for global Jeuveau revenue, supporting our expectation for total company revenue growth of 10% to 13% for the full year.

Turning to gross margin. Reported gross margin in the first quarter was 67% and adjusted gross margin was 68%, which excludes the amortization of intangibles. Regarding tariffs, a recent executive proclamation set a 15% tariff on certain pharmaceutical products in South Korea, including Jeuveau, with an effective date of September 29, 2026. We believe there is a pathway to mitigate or eliminate the impact of this tariff, and we are actively evaluating multiple options.

In the near term, we have a plan to secure significant U.S. inventory, supported by the product's 3-year shelf life, which provides flexibility as we bridge to longer-term solutions. We plan to provide an update by year-end as we gain greater clarity. Importantly, the announced tariffs do not impact or change our confidence in our 2026 outlook or long-term guidance.

Moving to operating expenses. GAAP operating expenses for the first quarter were $55.7 million compared to $55.1 million in the fourth quarter. As a reminder, the fourth quarter of 2025 included a $4.5 million benefit related to the revaluation of the contingent royalty obligation. In Q1 2026, the revaluation impact was immaterial. Non-GAAP operating expenses for the first quarter were $49.1 million compared to $53 million in the fourth quarter, reflecting continued discipline and the impact of structural cost actions we implemented last year. As a reminder, non-GAAP operating expenses exclude stock-based compensation, revaluation of the contingent royalty obligation and depreciation and amortization.

Within operating expenses, selling, general and administrative expenses for the first quarter were $52 million compared to $54.7 million in the fourth quarter. This included $4.8 million of noncash stock-based compensation similar to the prior quarter. From a profitability standpoint, we generated positive adjusted EBITDA of $0.6 million in the first quarter compared to a loss of $5.5 million in the prior year period. This improvement reflects both revenue growth and improved cost efficiency as we continue to scale the business while maintaining disciplined expense management.

Turning to the balance sheet. We ended the first quarter with $49.8 million in cash and cash equivalents compared to $53.8 million at the end of the fourth quarter. The primary uses of cash were interest and bonus payments, which were offset by the net proceeds from the line of credit. As a reminder, in addition to the approximately $50 million in cash, we have access to an additional $120 million in capital, $100 million on our long-term debt facility with Pharmakon and $20 million on the revolving credit facility. Our existing term loan does not mature until mid-2030.

Over the past 2 quarters, cash usage was modest at approximately $3 million in aggregate. Our current cash trajectory supports ongoing operating expenses, while the incremental facilities provide optionality for potential pipeline development opportunities. Overall, we believe this provides sufficient liquidity and flexibility to execute our strategy, invest in growth and progress toward meaningful free cash flow generation over time. Finally, we have recently terminated our at-the-market equity facility, which was never utilized, reinforcing our confidence in our current capital position.

Turning now to guidance. Our full year 2026 outlook remains unchanged. We continue to expect total net revenue of $327 million to $337 million, adjusted gross margin of 65.5% to 67%, non-GAAP operating expenses of $210 million to $216 million and a low to mid-single-digit adjusted EBITDA margin for the full year. The first quarter results strengthen our confidence in delivering full year profitability. Importantly, our long-term outlook through 2028 is unchanged, including our expectations for continued double-digit revenue growth, significant margin expansion and increasing operating leverage as we scale the business.

With that, I'll turn it back to David for closing remarks.

Thank you, Tatjana. We are very pleased with our start to 2026. The first quarter reflects exactly where we want to be as a company, delivering revenue growth while generating profitability. Importantly, this performance validates the operating model we've been building. We are scaling the business through performance above market, making investments to further expand our portfolio while driving improved profitability within a disciplined framework. We're also in a strong financial position. We have the liquidity to execute our strategy and invest in growth.

As it relates to tariffs, we are taking a proactive approach. Our goal is to eliminate any long-term impact, and our strategy is straightforward, create flexibility in the near term while we evaluate structural solutions. We will provide updates as we gain greater clarity. Finally, we are reiterating both our 2026 and long-term financial guidance. We look forward to updating you on our progress throughout the year.

Operator, you may now begin the Q&A.

And with that we will now be conducting a question-and-answer session. [Operator Instructions] And our first question comes from the line of Annabel Samimy with Stifel.

I just had some questions on the Evolysse launch. How do you find the headwinds of the filler market impacting the launch? And is bundling helping with increasing volumes here? Is any of the bundling taking away from net sales? Can you help us understand the dynamics there a little bit? You've talked about how sentiment seems to be turning, but growth in the market doesn't seem to be turning positive. So I'm just trying to sort of reconcile those 2 points.

Great. Annabel, this is David. I'll take the questions on the category for fillers. I'd say, especially coming off this weekend, where we have 50 clinicians here, the sentiment is turning more positive. And when I'm speaking with clinicians now, I'm consistently hearing that the interest in HAs is rising again, that they're seeing their utilization rising. So although we may still be in a market that on a year-on-year basis could be down slightly, it's a market improvement from the category that we were operating in 1 or 2 years ago. And that puts Evolysse in a really favorable position.

That being said, keep in mind, the competitive set has been in the market and well established for a number of years, not just in the U.S., most of these products were launched in Europe over a decade prior to entering this market. So they're well-established brands with a lot of history in terms of how to use the products and a full line of products that they're supporting clinics with. And so that's been the opportunity for Evolysse.

As we're getting in and we're exposing clinicians to the product and they're gaining more experience and trialing it and then getting additional trainings on the product, we're seeing that their confidence is rising and the reorder rates are increasing in terms of the amount that they're purchasing once they get that experience in the education. So we feel very good about the trajectory that Evolysse is on. We also recognize that we're not operating in the Mid-Face segment of the market, which is a sizable part of the HA category. Sculpt will be an important product in there. And we've mentioned many times before that we view the Sculpt product to be the flagship product in this line that will play an important role.

The other part that will play an important role, of course, is the bundling. And we piloted in the fourth quarter of last year a growth rebate that performed very well in a small subset of clinics. We rolled that out in January, and it's a 6-month program, very similar in time line to the competitive set. That's an important part of the conversation because clinics that move more of their business over to our portfolio are making trade-offs against the portfolio bundles of the competitive set. And we'll be in a position to give you more color from a quantitative standpoint coming out of our Q2 earnings call.

But I can tell you that we are tracking those customers that have expressed an interest in participating in our portfolio growth rebate, and we're seeing very good uptake around that group of customers. And so we do feel that we're on the right track with the product, and Evolysse is a very important part of that conversation overall.

Just a follow-up on the rebate. Is your -- the functioning of your rebate different from your competitors? And is it more of a direct cash savings than a rebate that goes towards forward sales? Like is it an easier rebate for them to wrap their economics around?

I think the rebate itself operates in a similar fashion in terms of they earn that amount back on their account, just like they would with the competitive set. Probably the part that makes it easier to execute is it's purely a function of their growth with Evolus. We designed it as a partnership rebate for clinics that want to partner more closely with us. That growth rebate gives them an additional incentive to cover the cost of making that conversion to bring their portfolio business over to us and in those increments of $75,000 and $150,000 incremental purchasing over what they purchased during that same period the year prior. As it relates to the accounting for it, I'll let Tatjana add some color.

Yes. So I think to your question around is the portfolio rebate a drag on net sales, it is not. And we've designed both the pricing tiers and the portfolio rebate to really be able to maintain a healthy margin rate. In terms of the net sales, that really is driven by that dynamic of last year. So as you may know, we deferred revenue for consumer rewards program for CBM and then we also recognize revenue upon delivery. And in any given quarter, this pretty much washes out and doesn't impact year-over-year growth rates. It just so happened in last year, Q1, there was a pretty good pickup, and we did not see that this Q1. And that is really where you've seen the net sales impact this quarter.

And our next question comes from the line of Marc Goodman with Leerink.

David, you gave us a sense that in the U.S., the business seems to be -- the market seems to be improving a little bit. Can you give us a sense of what's going on OUS, both toxins and fillers, what the dynamic is there, maybe just country by country? And then just secondly, Hugel came into the U.S. market last year as a competitor. Anything that they're doing differently today than they were doing 6 months ago? Just curious how well they're kind of breaking in.

Great. Marc, so I'll start with the OUS business. As we talked about in our full year earnings call from last year, our OUS business continues to perform incredibly well. If you double-click into any of those markets, the revenue is nearly doubling. And our most mature market being the U.K. was also on a very fast growth clip. And so we feel that we have a lot of momentum across the markets in Europe and especially considering the U.K. is the first market to be approaching double digits.

Those other markets are several years behind the U.K. in terms of the timing that we entered them directly. So we just see a lot of growth potential going forward. And with that greater scale, we have an increasing presence now in Europe as well. And that infrastructure, we're able to leverage the launch of Estyme. As a matter of fact, in 2 weeks, I'll be back in Europe for the launch of Estyme with over 100 of our top customers across Europe that will be coming in to learn about the entire line. And we think that's a significant advantage because, one, we'll be one of just a handful of companies that have both a neurotoxin and a hyaluronic acid in Europe. But two, because they'll benefit from having our flagship Sculpt product as part of the line.

As a matter of fact, we've been engaged with about 30 or so clinicians throughout Europe in an experience program for the last year. And it's very clear that the Sculpt product is a product that is highly differentiated from even the mature products that are available in Europe and that's a far more competitive market. So as we go across -- I know you asked for country by country, as we go across all the markets, we're seeing really great uptake. There isn't a single market that we're not seeing healthy growth in. And I think the team over there in international is just very focused and we have in-market country heads that are seeing a lot of success. We're excited to see what the team will do overall to that business over the next several years as we aspire to continue to build that business to approach roughly 15% of our overall revenue.

And then as we look to the U.S., look, I'd say the U.S. market, just overall, we continue to gain headwind -- gain market share in the category. We talked about the shares being steady in the first quarter. But even through last year, with the entry of a new competitor, we obviously saw a lot of heavy sampling initially and then you start to see the purchasing that follows from that competitor. And despite that, we continue to gain momentum in the market. And we do believe that this year will be much of the same as we look at that.

We expect another competitive entrant to enter in the back half of the year, once again, sort of rinse and repeat, meaning heavy sampling. And then ultimately, there'll be the need to drive that pull-through into revenue, right, from samples. So I don't have a whole lot to add in terms of anything different that I'm seeing in the field. I'd just say that the shares appear to be relatively stable as you look at them sequentially from the fourth quarter into the first quarter. We're not seeing any major share shift dynamic.

And our next question comes from the line of Uy Ear with Mizuho Securities.

So maybe just help us understand a little bit or whether you think it's fair. You kind of guided to high single digit for the first half of the year for Jeuveau. Is it fair then, I guess, to think about that perhaps there's a rebound or reacceleration sequentially going into Q2? And secondly, if my math is correct, does the high single-digit first half growth for Jeuveau, are you kind of blessing the consensus, which is roughly at $71 million for the second quarter?

Thank you for the question. Yes. So I think as you probably realize, what we're seeing this year in quarter-over-quarter revenue, Q1 versus Q4 and what you can expect for Q2 versus Q1 is really normal seasonality. And what we saw last year was really unusual. So in Q1, we had this dynamic where we had a pickup from the revenue deferral. In Q2, we really took a hit for the market slowing down. We're also launching Evolysse. So all of these things were happening last year that make for kind of an interesting comparison. But then when you just take across the first half of the year, what you will see is what we guided to, which is Global Jeuveau will show high single-digit revenue growth year-over-year.

And our next question comes from the line of Navann Ty with BNP Paribas.

Maybe a follow-up on fillers. If you have seen some further signs of recovery in Europe and in the U.S. and how our fillers are doing versus biostimulators? And then on competition, what are your assumptions on competitive launches maybe after the [indiscernible] FDA, CRL?

Sure. Thanks for the questions, Navann. I think the filler market in Europe certainly has been a bit more resilient than what we've seen in the U.S., and that has more to do with the economic backdrop in Europe, which has just been a bit stronger, and that's reflecting the growth rates, not just on the fillers, but the toxin market as well. In our year-end call, we made the comment that we estimated that the HA market in Europe may have turned to positive by year-end.

And so it's too early for us to give you any visibility to how the first quarter played out specifically in Europe, but we do believe that it's in line with where it ended in Q4, if not potentially improved. And despite the war that's going on and potentially the energy crisis, we haven't seen any meaningful change in terms of demand in Europe associated with potential any economic risk there. So the business overall continues to be strong.

As it relates to our assumptions, we did open the year saying we expected 2 new competitive entrants. We all read the news from AbbVie about the delay to the BoNT/E. In fairness, we had not estimated any impact to the existing market from short-acting products entering the category. So it doesn't change our assumptions as it relates to revenue for the full year. And we do continue to expect that Galderma will introduce their new liquid toxin in the back half of the year. And as you know, they have a final FDA response date expected sometime in the summer.

And our next question comes from the line of Douglas Tsao with H.C. Wainwright.

I guess, David, it sounds like you feel pretty good about the environment in the U.S. market. And obviously, both from your results as well as competitors, things seem strong. I guess just when you step back and think about the macro environment, obviously, we're looking at gas prices seem to be higher every day. And it seems unlikely they're going to come down anytime soon. I'm just curious sort of how we should think about sort of stress testing the macro environment in terms of the broader sort of aesthetics market.

Yes. I think the consumer was really tested last year with all the shifts that took place in the overall environment. And what you're seeing now as we wrap around on what was a really challenging base in the front half of last year that even though there's some puts and takes, if you will, in the news, the media, consumer sentiment, in the end, you're left with a value-conscious consumer that is continuing to come in and seek treatment. I'm spending a lot of time both in the market and talking to clinicians. And what I continue to hear is that business continues to be stable and continues to be strong on a year-on-year basis despite some of what we're reading in the backdrop.

So I think we feel pretty good about the trends we're seeing. We're also getting visibility into the start of the second quarter and we feel really good about the trends that we've started out with that continue to be strong. And so we're not seeing any signs that reflect that slowing. And perhaps the last part of it that is important is we have visibility to transactional data through our Evolus Rewards program and that's to the day.

We get a daily view of that utilization of product at the clinic level and we continue to see strength in overall redemptions in the Evolus Rewards program. So we feel confident that the market continues to be on a strong road to continuing to recover as we saw in the fourth quarter, again in the first quarter, and we're seeing it now as we start the second quarter as well and we're more than a month into it.

And that's really helpful, David. And I guess just as a follow-up, when we think about the filler market, which I think one of your lead competitors reported numbers in the first quarter that were down just a little bit. And I'm just trying to understand because I think there have been a few things going on in the filler market. Some of it has been macro related just because it's a higher price point product. There have also been some product-specific issues, right, in terms of adverse events for that product.

And so within that, do you have a sense whether sort of what we're seeing from some of the other players are related to their particular product portfolios versus just sort of filler picky, which I think we've talked about? And how do you sort of combat that? Or how does that inform your own strategy as the Evolysse launches sort of gain some momentum?

Sure. Yes, we have a lot of data points to reference, right? It's better sense reporting. We look at a lot of third-party data as well and rely heavily on conversations that we have with a number of clinics. And they all point to the same thing, which is the market is in some stage of recovery and rebound. Not clear yet whether we return to positive market growth, but we're getting very close, which is consistent with our views coming into the year. And keep in mind, we're benefiting from a significant tailwind of GLP-1 patients that once they achieve their desired weight, they have an interest in entering aesthetics.

There are a few areas in particular that they're interested in. And one of those is replacing their lost volume that's created from that weight loss in the face and people call it Ozempic face. And that is a tailwind for the category. We know that we're seeing some of those patients starting to come in, hasn't, of course, led to the tailwind that drives the category back to growth just yet. But it's not a question of if, it's a question of when. And I think that's what gives a lot of clinicians optimism is these consumers are new consumers coming into the category, and they will help fuel this HA market back to positive growth.

And we feel very good about where this category is going over time. And it ultimately comes down to continue to strengthen our position within that category set. And that's going to happen by continued focus on the differentiation of Evolysse with the training, the launch of the Sculpt product and then our focus on bringing these products together through a competitive bundle that is effective against the competitive set.

And our next question comes from the line of Sam Eiber with BTIG.

Maybe I can just start on Estyme and with the launch coming up here in May. I guess, should we expect any initial stocking order similar to what we saw with Evolysse in the U.S. in Q2 of last year?

Yes. Sam, that is a good question. And we did expect some, but just consider the size of that market, right, and Estyme launching in the middle of the quarter. So we would see some stocking, but it isn't going to be a meaningful impact to our Q2 growth.

Okay. That's helpful. And maybe I can just use my follow-up here on any feedback or conversations you're having with the FDA on Sculpt. I know you guys have reiterated time lines for the Q4 approval, but curious if you're in communications with them and what you've been hearing.

Yes. I have Rui sitting right next to me, so I'll turn it over to Rui to answer your question.

Sure. It's one of -- it's a PMA. It's going through the regular PMA process where we get questions along the way and can also be interactive. So we continue to say Q4 is -- we're hoping to have approval by the end of the year. And -- but something -- sometimes it will go faster. Sometimes they hopefully go on time lines. Just as a reminder, Form and Smooth, we were also conservative on time lines, but we got lucky there and things -- we got that approval earlier.

And our next question comes from the line of Serge Belanger with Needham & Company.

I guess for David, you talked a little bit about what sounds like an increasing appetite for BD and making additions to your product portfolio. Can you maybe just talk about what kind of products you're interested in and maybe how large of a transaction we could see here?

Yes. We're very active on the pipeline side. Rui sitting next to me has likely more experience than anyone in the aesthetic space and getting drugs through the FDA and devices through as well. And so we have the luxury, although we're still an earlier-stage company commercially, we have the luxury of having a fully staffed organization of clinical development, regulatory and that capability. And I think that's well recognized within the industry, which is why we get a first look at assets, especially those that are more complex to develop. So I'll let Rui talk a little bit about where we spend a lot of our time looking at assets today.

Yes. So as earlier mentioned, biostimulators remain of high interest to us. And there are a number of assets out there. So we look at the various ones and look at strengths and weaknesses, just like what we did with Symatese and that HA. There were a number of HAs we looked at them, and we're glad we landed at there. Skin quality remains something of high interest. In Europe, it's quite popular. There are a number of things, bringing to the United States, higher bar of entry. And as far as we know, there's only one that's been approved thus far. And then things like hair continue to be an unmet need. I think there's a lot of opportunities, and we've seen a very successful story out there right now.

Thank you. And with that, ladies and gentlemen, this does conclude our question-and-answer session as well as today's teleconference. We thank you for your participation and you may disconnect your lines at this time, and have a wonderful rest of your day.

Good afternoon, everyone, and thank you for standing by. Welcome to Evolus' Fourth Quarter and Full Year 2025 Earnings Conference Call. [Operator Instructions] As a reminder, today's conference call is being recorded and webcast live. [Operator Instructions]

I'd like to turn the conference call over to Nareg Sagherian, Vice President and Head of Global Investor Relations and Corporate Communications. Please go ahead.

Thank you, operator, and welcome to everyone joining us on today's call to review Agris' Fourth quarter and full year 2025 financial results. Our fourth quarter and full year 2025 press release is now on our website at evolus.com. With me today are David Moatazedi, President and Chief Executive Officer; and Tatjana Mitchell, Chief Financial Officer. Rui Avelar, Chief Medical Officer and Head of R&D, is also with us for the Q&A portion of the call.

Today's call will include forward-looking statements. Actual results may differ materially due to risks and uncertainties outlined in our earnings press release and SEC filings. These forward-looking statements are based on current assumptions, and we undertake no obligation to update them. Additionally, we will discuss certain non-GAAP financial measures. These measures should be considered in addition to and not as a substitute for our GAAP results. A reconciliation of GAAP to non-GAAP measures is included in today's earnings release. As a reminder, our earnings release and SEC filings are available on the SEC's website and on our Investor Relations website. Following the conclusion of today's call, a replay will be available on our website at investors.evolus.com.

With that, I'll turn the call over to our CEO, David Moatazedi.

Thank you, Nareg. Good afternoon, everyone. Before reviewing our 2025 performance and outlining our objectives for 2026, I would like to take a step back and provide a broader perspective around our performance beauty strategy. As we enter our seventh year as a commercial stage company, I'm proud of the fact that we are redefining the category through a beauty first lens. We are the first company with a neurotoxin dedicated exclusively to cash pay aesthetic and free from reimbursement dynamics. This approach enables deeper alignment with our customers and allows us to build differentiated long-term partnerships with aesthetic practices, partnerships that are increasingly translating into measurable share gains.

The key piece of that strategy is Evolux, the first program in the industry that rewards practices with co-branded media investment tied to purchase volumes. As our customers grow with us, we reinvest to drive awareness for both our products and their practices, strengthening the partnership and reinforcing shared success.

We've also focused on increasing patient retention through Evolus Rewards the first SMS-based loyalty program in aesthetics and the only consumer loyalty program co-branded with clinics. The program is designed to drive repeat visits and build lasting relationships between practices and patients. Over the past 6 years, Evolus Rewards has grown to more than 1.4 million treated patients, reinforcing brand preference and contributing to sustained share expansion.

In the fourth quarter, we successfully piloted our new portfolio growth rebates, which officially launched at our national sales meeting in January. This growth rebate is designed to reward practices for growing with Evolus across our expanding portfolio of products, further increasing our strategic importance within each account and strengthening our competitive position.

Education remains another cornerstone of our model. We have built a world-class medical education platform with broad reach and comprehensive curriculum that includes CME programs, live broadcast to cadaver labs, preceptor ships and small group hands-on trainings. In 2025 alone, we provided hands-on trainings to over 14,000 clinicians directly in their clinics. This year, we are elevating that platform further and we'll be hosting top-tier clinicians with new flagship training events at Evolus' headquarters. These immersive 2-day training will be focused on anatomy, clinical training and business support for high-volume practices.

Most importantly, we continue to build a world-class portfolio of differentiated products. Jeuveau, our flagship neurotoxin remains a strong and growing product. We continue to advance the science, supporting its unique precision profile and differentiation, including an independent study published last year in JAMA demonstrating fast onset, the highest peak effect and the longest duration of the toxin study. It represents the second head-to-head study validating Jeuveau's advantages.

Clinicians who trial the product recognize the differentiation which has supported our capture of over 14% U.S. market share to date. We continued to gain share in 2025, even in a declining procedural environment, demonstrating the resilience and competitiveness of the brand. In 2025, we also introduced the first new HA technology in over a decade with Evolysse. Our first 2 formulations are now in the market, and we expect FDA approval of Evolysse Sculpt, our flagship mid-face volume product in the fourth quarter.

Our proprietary codex technology creates a natural HA formulation, which successfully demonstrated a longer duration of effect against one of the market-leading brands. Customers are reporting strong satisfaction, noting that gels efficiency and forgiving depth of placement, allowing injectors to achieve a more subtle natural-looking results. To date, more than 3,000 customers have purchased Evolysse, expanding our presence within accounts and increasing our overall share of injectable spend. As we enter the second phase of launch in the second quarter of 2026, we will be initiating a large sampling and experience program, which we expect to broaden the adoption of Evolysse.

Internationally, we also continue to make significant progress. Last year, we entered France with our partner, [ Civitas ], transitioned Germany to a direct model in the fourth quarter and delivered strong growth across existing markets. As a result, we now operate in 9 countries outside the United States with international revenue nearly doubling year-over-year. In key markets such as the U.K., we are approaching double-digit market share, reflecting the strength of our positioning outside the U.S.

Turning to operating performance. was a unique year for the aesthetics market and only the third time in 25 years that U.S. injectable procedural volumes decline. Despite that backdrop, Evolus delivered 12% full year revenue growth marking our sixth consecutive year of double-digit growth. We exited the year on an accelerating growth rate of 14% in the fourth quarter, supported by top line growth across all product lines in the U.S. with Jeuveau and Evolysse as well as our international business.

Midyear, we made the right decision to rebase our trend structure and align the organization for durable, profitable growth. The benefits of these actions were evident in the second half of the year where we achieved meaningful operating leverage. That structural reset and expense base positions us for 2026 and where we expect to deliver on our revenue guidance, while growing non-GAAP operating expenses at a modest 0 to 3%, and expanding operating leverage to result in a low to mid-single-digit adjusted EBITDA margin.

Our strategy remains consistent. We are building a global performance beauty company centered on differentiated brands for the [ cash pay ] consumer. In 2026, we look forward to introducing a steam in Europe in the second quarter expect FDA approval heavily sculpt in the fourth quarter and continue actively engaging in pipeline opportunities. We are deeply committed to driving profitable growth going forward and continue to target revenue between $450 million and $500 million, with 13% to 15% adjusted EBITDA margins in 2028.

This outlook is meaningfully supported by the strengthening U.S. Jeuveau share to the mid-teens, scaling U.S. Evolysse share into the high single digits and the international business growing to more than 15% of total revenue.

With that, I'll turn it over to Tatjana to walk through the financial details.

Thank you, David. Before walking through the fourth quarter and full year results, I want to recognize our commercial and operating teams for their execution throughout 2025. It was a year that required flexibility and discipline as we navigated a challenging U.S. aesthetic market. The organization responded with clear prioritization, thoughtful cost management and a focused allocation of resources towards the highest return initiatives. That discipline allowed us to deliver fourth quarter profitability and positioned us well for sustainable annual profitability beginning in 2026.

I will now review the financial results. Global net revenue for the fourth quarter was $90.3 million, representing 14% growth over the fourth quarter of 2024. This included $83.1 million of global Jeuveau revenue and $7.2 million from Evolysse. For the full year, global net revenue was $297.2 million up 12% compared to 2024, marking our sixth consecutive year of double-digit growth.

International revenue represented approximately 8% of 2025 global revenues, increasing from 5% in 2024. This included product revenue from Europe and Australia and service revenue from our distributor relationship in Canada. We are seeing continued momentum in our international markets, including approaching double-digit market share of toxin in the U.K., our most mature markets. International revenue is expected to become a more meaningful contributor over time as we prepare for the European launch of Estyme in the first half of 2026 and continue to grow our toxin share in existing markets.

Turning to gross margin. Reported gross margin for the fourth quarter was approximately 66% and adjusted gross margin, which excludes the amortization of intangibles, was approximately 67%. For the full year, reported gross margin was approximately 66% and adjusted gross margin was approximately 67%.

With respect to tariffs, based on announcements to date, Jeuveau, a biologic is not currently impacted by tariffs. Following the recent U.S. Supreme Court decision and subsequent executive actions, Evolysse, which is classified as a medical device and imported for France is currently subject to a 10% tariff. The administration has also communicated the possibility of an additional 5% tariff, though it has not been formally implemented.

Our fiscal 2025 results reflect the previous 15% tariff and our 2026 guidance also reflects a 15% tariff assumption. We are evaluating the potential recovery of previously paid tariffs. We also continue to monitor policy developments and will evaluate any potential impact pending further guidance from the administration.

Moving now to operating expenses. GAAP operating expenses for the fourth quarter were $55.1 million, down from $57.3 million in the third quarter. As a note on this quarter-over-quarter decrease, we realized the $4.5 million benefit driven by the revaluation of the contingent royalty obligation. Non-GAAP operating expenses for the fourth quarter were $53 million compared to $49.7 million in the third quarter, which includes the timing of costs related to our customer and that shifted from the third quarter to the fourth quarter.

For the full year 2025, GAAP operating expenses were $229.8 million compared to $216.7 million in 2024. Non-GAAP operating expenses were $209.7 million in 2025 and within our guidance range of $208 million to $213 million. Importantly, non-GAAP operating expenses declined 4% in the second half of the year compared to the first half. reflecting the benefits of expense reductions we implemented in Q2. As a reminder, non-GAAP operating expenses exclude stock-based compensation, revaluation of the contingent royalty obligation, depreciation, amortization and restructuring costs.

Within operating expenses, selling, general and administrative expenses for the fourth quarter were $54.7 million compared to $52.8 million in the third quarter. This included $4.8 million of noncash stock-based compensation compared to $5 million in the prior quarter. For the full year 2025, SG&A expenses were $220.8 million, compared to $198 million in 2024, reflecting investments in our evolution into a multiproduct company with the launch of Evolysse in the U.S. as well as investments in scaling existing international markets.

Non-GAAP operating income for the fourth quarter was $7.1 million compared to $6.7 million in the fourth quarter of 2024. As a reminder, both non-GAAP operating expenses and non-GAAP operating income excludes stock-based compensation expense, revaluation of the contingent royalty aggregation, depreciation and amortization and restructuring charges. Non-GAAP operating income also excludes amortization of intangible assets.

Turning now to the balance sheet. We ended the fourth quarter with $53.8 million in cash compared to $43.5 million at the end of the third quarter. The increase was driven by strong sales growth, disciplined expense management and effective working capital execution. As we look ahead to 2026, while we are not providing specific cash guidance, we expect cash usage to be meaningfully lower than in 2025 as operating leverage improves. Our use of cash in 2026 will primarily reflect interest payments and investments ahead of the anticipated launch of Evolysse Sculpt, including inventory build and a milestone payment.

Today, we entered into a revolving credit facility with Eclipse Business Capital, providing up to $30 million of availability with an accordion feature up to $40 million. This facility is supported primarily by our receivables and will be used for working capital needs, including inventory build and preparation for the anticipated launch of Evolysse Sculpt.

As a reminder, under our long-term debt agreement with Pharmakon, we retain access to 2 additional $50 million tranches with no incremental financial covenants or performance conditions and our existing term loan does not mature until mid-2030. Taken together, our approximately $50 million of cash access to up to $40 million under the revolving credit facility and availability of an additional $100 million under our existing long-term debt agreement provides substantial liquidity and flexibility.

Combined with our improving operating leverage and sustained profitability beginning in 2026, we believe we have a clear path to generating meaningful free cash flow in the years ahead. This capital structure gives us the ability to scale the business, proactively manage our debt and continue to invest in growth. We are not planning to raise equity capital and remain highly sensitive to dilution.

Let me now summarize our 2026 guidance. We expect total net revenues to be between $327 million and $337 million, which represents 10% to 13% growth over our 2025 results. Evolysse and Estyme injectable HHL are expected to contribute 10% to 12% of total revenue in 2026. Adjusted gross profit margin for the full year 2026 is expected to be between 65.5% and 67%, reflecting an evolving revenue mix while maintaining the disciplined approach to margin optimization.

Non-GAAP operating expenses for 2026 are expected to be between $210 million and $216 million. representing a mini 0% to 3% increase over 2025. Against our anticipated double-digit revenue growth, this reflects meaningful operating leverage, driven by structural efficiencies implemented over the past year. In 2025, we aligned our commercial organization to support the multiproduct portfolio across U.S. and international markets. and streamlined our support functions, allowing us to scale revenue in 2026 without proportionate increases in field infrastructure.

As previously guided, we expect to achieve full year profitability in 2026, delivering a low to mid-single-digit adjusted EBITDA margin on a consolidated basis. Beginning in fiscal year 2026 we will transition our primary profitability metric from non-GAAP operating income or loss to adjusted EBITDA to improve comparability with industry peers. This change does not impact our reported results as the reconciling items between the 2 metrics are consistent.

As a point of note, other modeling assumptions for 2026 include: annual interest expense between $16 million and $17 million, which includes interest and amortization of financing costs on the long-term debt facility and on the revolving credit facility. Full year diluted weighted average shares outstanding of approximately $68 million.

In summary, our 2026 outlook reflects the structurally improved cost base. disciplined capital allocation and increasing operating leverage, positioning the company for sustained profitability and future free cash flow generation.

With that, I will turn it back to David for closing remarks.

Thank you, Tatjana. As we look ahead, Evolus enters 2026 from a position of strength. We've solidified our operating foundation, expanded our portfolio and demonstrated the discipline required to scale profitably with double-digit growth, a largely flat expense base, and multiple value-creating milestones on the horizon, we are entering a period of accelerating operating leverage and sustained profitability.

Our focus remains clear. We're building a global performance beauty company centered on the customer experience, investing to drive practice growth while maintaining the expense discipline necessary to drive operating profit. We look forward to launching Estyme in Europe next quarter and gaining approval of Evolysse Sculpt in the fourth. These milestones, coupled with the continued momentum across our portfolio, reinforce our confidence in achieving 13% to 15% adjusted EBITDA margins in 2028.

Thank you for your continued support. We look forward to updating you on our progress throughout the year. Operator, you may now begin the Q&A.

[Operator Instructions] Our first question is coming from Annabel Samimy from Stifel.

And I guess good luck into the year. Some questions about Evolysse and just trying to understand qualitatively is the growth of at least been primarily coming from the early adopter population? Are you starting to -- is the new count build starting to come from those injectors who want to start taking advantage of Evolysse in the portfolio? And are you starting to go deeper? Or is it starting to go broader? So maybe you can give some qualitative description around those ordering patterns.

Sure. Annabel, thanks for the question. So what we're seeing with Evolysse is a business that's continuing to diversify in terms of its customer base. As I mentioned on the call, we're now -- we now have over 3,000 purchasing accounts which represents a large portion of the Jeuveau revenue that was generated last year is now placed in order for bales. So we feel very good about our ability to establish Evolysse in some of those clinics. We were also very pleasantly surprised by the portfolio rebate and how important that was in the fourth quarter within some of those accounts to commit a larger portion of their overall filler and toxin business to us, especially recognizing that we're operating with the first 2 formulations, and we plan to introduce more. So the portfolio rebid helps build on that momentum.

What we also see is an opportunity now that we've learned a lot about this product to take it significantly wider. And that's really the initiative that we referenced on the call. In the second quarter, we plan to engage in a heavy sampling and trial program to universe outside of that group of 3,000 to give them the opportunity to trial the product to gain the training required to adopt it and broaden that universe in advance of the approval of Sculpt and subsequent launch. And so we feel that we're on a very good track with the product. You saw the momentum build coming out of the year in the fourth quarter, and we see the momentum continuing to increase.

Feedback from customers, we've done a number of surveys, and this is probably the most important part and we know that others have done channel checks, it's very positive on this product. The more experience that clinicians get with Evolysse, they realize that the advanced technology gives them a number of unique differences from the formulations that are currently available in the market. What's happening in the backdrop is consumers are looking for more natural fillers and a more natural look.

And Evolysse, because of the Cold-X technology it's designed in a way that gives you more effect with less product, creating a more natural look rather than relying on the swelling of the HA to deliver that outcome and we hear that consistently on top of the fact that they have the latitude to inject this product at varying depth -- and I think that gives it also one other clinical advantage that we're hearing in the market as well. So overall, the buzz on this product is great. We're looking to take it wider as we get into the year.

I guess a follow-up question to that. Is this a product that you think turn around the growth in the market that I think was probably impacted not just by macro, but possibly changing trends.

Yes. As you said, there are 2 parts. I think the macro piece mirrors, if you will, the toxin market, we do believe that you're starting to see improvement in the filler market when you look at the overall category year-on-year. But the changing trends is certainly a part of it because of communication that clinicians now have with their consumers is evolving around the use of HAs and we know that they're using less volume in each treatment. I'm going to turn it to Rui because I know Rui spent a lot of time recently with a number of clinicians talking about how the pillars evolving especially with Evolysse.

Yes. And I think you've covered the major points, actually. It is a trend towards going to more natural certainly one thing it's certainly been helpful to punctuate the fact that this is a high uronic acid and distinguish the different opportunities that are within the filler. The thing that seems to be resonating very well is we saw in the clinical data that you don't need a lot of product to get effect. In fact, examples of less products still getting more effect. That's resonating really well, also less product being required.

And then ultimately, from an injector perspective, they really appreciated the fact that you correct to the outcome that you're looking for. You don't have to undercorrect and anticipate swelling, you don't have to overcorrect because you're going to [indiscernible]. So that neutral has been a big thing for the injectors. And finally, our data certainly suggests that the duration is there when we look at the 1-year data for formatting the 2-year data from shop.

Great. And if I can just ask one last quick follow-up. In terms of the accounts that are ordering, are they predictably ordering after that second training now? Have you seen that consistent with what you've said in the past? Or is there still a pause after they first get trained?

Yes, it's a great question. I think coming out of the third quarter, we talked about that second training being an inflection point in utilization of the product. And we continue to see that being a really important indicator getting them sample first and then trialing the product to get trained, followed by a second training, and we continue to emphasize that as well with the field. I talked about all the different training vehicles we have.

I want to just my hats off to the education team across the company because we have a very comprehensive medical education platform, the launch of Evolysse was marked with a very large webcast, several thousand attendees. We've now done several thousand ends on trainings as well and we have more clinics that could go through the second training. So we have our road map mapped out for us with existing clinics to drive meaningful volume increase. as well as those new clinics to get that initial training.

And we feel like we've got a great handle on this product. We are optimistic that the market is showing signs of recovery, although we do forecast a bit of a decline in the filler market continuing this year, and it is an improvement. But we expect that to start to recover towards the latter part of the year. So overall, we feel like we're on the right track. Our guidance reflects that as well. and we're really looking forward to putting this in the hands of more clinicians.

Our next question today is coming from Marc Goodman from Leerink Partners.

This is [ Eliz ] on for Marc. I was wondering if you could provide some more detail on the structure of the rebate program, specifically how rewards are tiered for participating in clinics and what metrics determine their eligibility? And secondly, looking ahead to 2026, how would you describe the overall marketing strategy? Are there active consumer-facing brand campaigns active right now and how the investment split across the fillers versus toxin?

Okay. Why don't I touch on the rebate and briefly on the marketing strategy, and then I'll have Tatjana to touch on the investment overall as you think about really broadly commercial, how you think about that investment. Starting with the rebate, one of the things we've prided ourselves on from the beginning is we value transparency in how we price our products and how we operate. And so when we launch this portfolio rebate, it was designed as a growth rebate in the pilot. And so accounts that purchased 50,000 more in the quarter or 100,000 more in the quarter, they were eligible to receive a growth rebate for committing more of their business to Evolus. And that growth rebate came at the very end of the quarter as a result of directly from their purchases.

And that complemented our Evolux program, which I touched on earlier, which is a volume-based pricing program. That is exactly what we're mirroring in the front half of the year. It was very simple to communicate 2 accounts. As a matter of fact, I had the opportunity to present this to a number of accounts in the fourth quarter during the pilot phase. And I'd tell you it was incredibly well received. I think many investors know that one of the challenges when we're a single product company is we were competing against portfolio bundles.

This growth rebate in the pilot was designed to work through those bundles and it did so very effectively. And we trained our sales force in January on that growth rebate. It is based on 6 months of purchasing volume for those clinics. So it's from January 1 through the summer from the end of June. And we're hearing very good feedback on it. As a matter of fact, it's not just a portfolio rebate. We're hearing the same with our national accounts where we're seeing a very high growth rate in those national account chains as well, but see an opportunity to partner with Evolus in a more meaningful way. And that's really been the focus of the team.

And then lastly, on the marketing strategy. Look, what I love about what we're doing is we're building on these unique capabilities. Our marketing strategy in terms of investing back in the clinics is directly tied to Evolux. And so we're doing unique things like digital advertising, billboards, TV spots, and we're doing them on both Jeuveau and Evolysse. They're all customized around the clinic and they're all targeted within the radius of their practice. And now that we increase our base of users, it's increasing our media spend as well in a very efficient way, and I know Tatjana will touch on that.

And the last thing, we do co-promotions as well with other beauty brands. In the first quarter, we did 1 with Jeuveau and a brand called [ Ipsy ], which creates beauty products and accounts were able to purchase Yueou and earn a number of these gift bags that they in turn were able to market to their patients as a gift with purchase. And we think this is one of the unique elements of being a cash-based company, focused on the B space that enables us to partner with our clinics and give them value-added benefits that help them attract new consumers to their office. That partnership with Ipsy was exclusive to Jeuveau, we're the first beauty company they partnered with, and it became a benefit for those patients.

But I'll let Tatiana talk a little bit about what that spend means.

Yes. Thanks, David. So maybe I think it's important to comment on our commercial spend. So the largest portion of that spend is really on our sales team and all of their activities. The next largest is in training. And then the 2 others are marketing where you would consider traditional media, and that's when we talk about CBM, the co-brand marketing. And then the fourth piece that David mentioned are these partnerships.

We disclosed our advertising costs. So we disclosed this media spend. And for the last 3 years, if you look, it's been in the range of $7.5 million to call it $9 million. And for 2026, it's going to stay in that range. And what we're able to do with that CBM, which is burned through the Evolux program, is really support the practices to drive the client ROI for us and for them, but it's not this traditional just going out right and spending media into advertising the brands.

Our next question is coming from Uy Ear from Mizuho Securities.

I guess, David, just based on your internal data such as your consumer loyalty brands and whatnot. How are you sort of seeing the market, the toxin market trending and how -- I think you perhaps kind of commented as well on improvement in the facial filler market. Maybe just help us understand what you're seeing based on what you're hearing externally as well as what you are seeing internally? And I guess the second question we have is on your portfolio programs. I think you mentioned it was helping adoptions of Evolysse. Just wondering whether it's also helping with Jeuveau's adoption expansion as well in the accounts?

Yes. Thanks for the question, Uy. I think we have a really great handle on both not just our internal data, but some of the third-party external data in terms of what that means for the market. And to boil it down in 2025, we believe that the neurotoxin market declined mid- to upper single digits in terms of overall volume. And you saw that our business for Jeuveau, we gained in units despite the fact that you saw the entrance of a new competitor. So here's a brand in its sixth year that's continuing to demonstrate resilience.

And I do believe we have a large part to do with a differentiated clinical data set as well as a very sophisticated sales organization with a number of unique tools because of our cash pay advantage. And we see that supported in our Evolus Rewards program that consumers are coming back and seeking retreatment with Evolysse -- with Jeuveau rather. And we continue to see that the retreatment rates rising over time.

At the same time, I think we've seen over the course of the year, overall procedural volumes started to show incremental improvements, especially if you compare to the first half of the year to the back half, we saw a meaningful improvement in the overall toxin market, and we do believe that although not all companies have reported yet, then in the fourth quarter, the market returned back to some level of stability, call it flat to low single-digit growth on the neurotoxin market.

And you can mirror that to some degree on fillers, just not back to the same level of recovery and that it reflected that the market was returning to some level of improvement. And we expect that to continue into this year. And that's really what we've modeled is a toxin market with call it, low single-digit growth, a fill a market that we'll start to see a road back to recovery for this year.

And I think our internal data supports that. We're really pleased with what we're seeing in the market to start the year. I talked a little bit about our national account growth is incredibly healthy to start the year. The discussions around the portfolio that our sales force is having have been incredibly positive, and we're continuing to see momentum there. And so we see it as continuity in the right direction on the overall business. At the same time, it's important to recognize that this is all marginal improvement over the prior time period. We haven't yet seen about that. And so our guide doesn't reflect that. But to the extent we do, we'd expect to see a fairly short recovery once that does occur.

And you're absolutely right that there's an interplay between the benefits of adding a new account for Jeuveau and the willingness to trial Evolysse. And also on the inverse, the Evolysse accounts that have brought Jeuveau into the door. And I think given we're just 3 quarters in, you're just starting to see the benefits of those 2 brands cross-pollinating both around the clinic and in front of the consumer because they earn the rewards on both brands.

And so we see a lot of opportunity in 2026, especially with the focus on the portfolio bundle to be able to capitalize on that unique advantage. And of course, the approval of Sculpt only gives us an additional boost as we build on that portfolio benefit.

The next question is coming from Navann Ty from BNP Paribas.

Can you discuss your assumption on the competitive launches into the guidance the BoNT/E and [indiscernible]? And also, if you can discuss your strategy around bundling after when you will be able to leverage scope?

Navann, thanks for the question. As you pointed out, 2026, we're going to see 2 new toxin entrants in the 2 bigger players in this space. And so we expect AbbVie to launch their neurotoxin a shorter-acting BoNT/E in the summer is what we understand. And then in the back half of the year, we expect liquid toxin to be introduced by Galderma. So we'll see the sampling that will come with those just as we did last year with the introduction of a player from Korea with [indiscernible], we expect to see heavy sampling in the market. That is reflected in our guide.

And just keep in mind, sampling doesn't always translate over to adoption. So in the near term, it creates some pressure. But over the long term, you start to see accounts will commit to the brands that they're willing to purchase. Although we haven't seen a short-acting talks in the market, it would be interesting to see their go-to-market strategy, don't have a lot of visibility to that. On the liquid product, we certainly competed with that product in Europe now it's approaching a year. It's been available there.

So we're very familiar with it and understand how both consumers and clinicians see that. And I think as we get closer to commercialization, maybe we'll be in a position to talk a little bit more about that aspect. And I think that answers the second part to your question.

And just on the bundling, how will the strategy will evolve with Sculpt?

Yes. I think for this year, we're focused on the portfolio growth rebate for a full year. This is a pretty significant shift in conversations, you can imagine. Our reps are now going in there and having a conversation about committing an account business to us over a 6-month period in order to gain these benefits. These are strategic conversations for the clinic around who they want to commit their partnership to and the portfolio rebate gives us the rationale in the portfolio itself gives us the support to earn that business.

And so we're seeing very good uptake early on. We expect to continue to do the portfolio rebate through the back half of the year as well. And as we expect scope approval in the fourth quarter. That will be a product we'll talk about in 2027 more meaningfully and we may look to make adjustments to the portfolio growth rebate as we see it play out over the course of this year. We're just a couple of months in, and we're really pleased with how the field is executing against it.

Your next question is coming from Sam Eiber from BTIG.

Maybe just following up on the last question. I guess how should we think about biller growth perhaps accelerating in 2027 with the Sculpt launch? I guess, or accounts waiting for the product? Or does it early just change the conversation you're able to have with providers here?

Yes. Maybe we'll start -- I'll turn it over to Rui ton talk a little bit about clinically why this is meaningful to the accounts? And then I can talk a little bit about how that plays into the broader bundle in partnership with the clinic.

When we think about products like Sculpt, we're now describing the premium sector within the HA and the flagship product there is [ Sovaluma ], for instance, that's the largest, most successful HA has ever been launched. We think Sculpt will represent a competitor to that product. And when we think about what we're doing with that mid face, we're asking these gels to come in and take volume and do something that's really quite structural. And remember, it comes from a minimally invasive form. We are very optimistic about this product when we were doing diligence on the product. The investigators were very happy with the performance.

And subsequent to that, we've actually gone against a product that's in the market well known and we've shown that we showed an inferiority and superior at the primary endpoint. And then more impressively, as you follow it out over time, when you get to the to your mark, we're showing 2 to 3x more responder rates the 2-year mark. So we're optimistic. We're optimistic from that data. And as we're getting feedback from people using it in Europe, that feedback is actually correlating really well with what we saw in the clinical trials.

Yes. And then as it relates to the overall portfolio bundle, look, we see our positioning in this market continuing to strengthen. You look at Jeuveau, 6 years mature, continuing to capture market share. Ables off to an incredibly strong start in a market that has been challenged. But when you back out the underlying market performance -- the actual performance of Evolysse within the market has been very strong, and we're doing that without a full portfolio in the space. And so we do believe that this is going to continue to build on our in-market share gain momentum that we continue to demonstrate as a company.

And I think you couple that product being highly differentiated with our cash-based strategy on top of this large injector base that's purchasing Jeuveau, and we see a lot of opportunities to drive continued momentum over the next several years. And I'm really excited to see what the international team could do with the Estyme products in the U.K., where we're now in our fourth year approaching double-digit market share with New [ CEVA ], which is our tax in there, that stem product is going to be rolled out with all 4 formulations all approved at the same time.

And so that's going to give the team in the U.K. a real boost in terms of our ability to more effectively compete against the portfolio. So we see this as part of the natural evolution of the company, and we're excited to see this unfold.

Okay. That's really helpful. Maybe I can just ask a quick follow-up on some of the inventory dynamics at the provider level. Just is that back at what you would describe as normalized levels at this place? Or is there more room to work through that?

I think what we saw in the middle of last year was a drawdown in inventories, and we continue to believe that accounts are measured in how they take on inventory in this environment. They're seeing an improvement, which means they're a little more open than maybe they were coming out of the second quarter. At the same time, we haven't seen a rebound, where they're back to the inventory levels that they were in before. So that could potentially be something that could be a net positive if we see the market return more strongly as we get into the year.

Your next question is coming from Doug Tsao so from HC Wainwright.

David, you touched on it a little bit. But obviously, last year, you had the competitive entrant from the Korean manufacturer, which with a, what I would sort of characterize as sort of a differentiated neuromodulator. I guess when you think about both the derma as well as Allergan expected launches of real fades as well as BoNT/E. They're coming at it with sort of this fast onset talk, 1 is going with short duration and one is making longer duration claims. I guess I'm just curious if you have a perspective on how those will shape up or influence the market?

Sure. Yes. I mean look, never take any competitor lightly, let's start there, and never take a moment like a new entrant coming in to capitalize on an opportunity, and I'm really proud of what the team did last year with the entrance of a new toxin player in the space we maintain our focus and you saw us continue to gain share despite the market declining. And I attribute a lot of that to the intensity that we bring to the way that we think around any new competitors. It starts with a heavy review of the science and clinical data. As you said, there are claims that are made around onset or claims that are made on longevity.

And in the end, the question is, does the data support some of those plants. And I think that's our job to make sure that we provide a counter to some of the claims that are made in the space, but also to ensure that clinics are focused on the long game. You want to deliver high-quality products that deliver high patient satisfaction in a profitable way to grow your practice. And we believe that's what we're incredibly well positioned in this space. We're the only company that's reinvesting back into these clinics to help drive that growth. we're reinvesting back and retaining those patients to continue to build on those practices and we're doing it with a broad portfolio.

So it will be up to the new players to establish their value proposition in this space vis-a-vis the current products they have, but we think this creates an opportunity for us. And I know the team is very excited for it, and it's something we won't be talking too much about until we get to the middle of the year, but we'll certainly be prepared.

Your next question is coming from Serge Belanger from Needham & Company.

I guess the first one, David, can you just talk about maybe the seasonality trends for what we've seen so far in I know some other companies have talked about the winter storms affecting volumes for the early part of the year. Just curious if that's also been an issue in aesthetics. And then secondly, regarding the European market, just curious if they've experienced the same kind of macro headwinds that we've seen in the U.S. on the toxins and especially on the fillers if they've seen that same -- those same headwinds that have affected the U.S. market?

I want to turn it over to Tatjana to talk a little bit about the seasonality, and then I'll take the comments around this.

Yes, yes. So what we're seeing in Q1 really is similar to what we saw exiting Q4, which is the toxin market is showing solid demand, right? We do not believe this market is declining. And then the filler market is still pressured, but not seeing those double-digit declines that we solve for most of 2025, and that is consistent with our guidance. also consistent with our plan. We rolled out these plans at the national sales meeting, similarly at the international sales meeting. And we feel good about these and we're executing on them. I can't necessarily say we've seen issues related to the weather.

David, maybe you can comment on the European markets.

That's right. And in Europe, the overall economic environment has been stronger in Europe relative to the U.S. So when you think about the toxin space as an example, we don't believe that the toxin market declined in Europe last year. And at the same time, we do believe that there are signs that the HA market did recover towards the end of the year. And we do believe that it could have been flattish to exit the year in the HA market. And it's been a pretty sharp reversal from what was a decline in Europe in procedure line for HA products as well.

So that gives us some level of optimism that we're trailing about 6 to 12 months behind Europe in terms of our recovery of the HA market. And that's something we're going to watch closely. But as it relates to our guide for this year, just to reiterate, we assumed that the filler market would decline low single digits over the course of this year.

Thank you, and thank you for all your questions. At this time, I'd like to turn the call back to Nareg Sagherian for details on upcoming IR events. Nareg?

Thank you. We look forward to continuing the conversation at the Leerink Global Healthcare Conference in Miami on Wednesday, March 11. We hope to see many of you there. Thank you for joining us today.

Thank you. We end up our call. You may now disconnect your lines.

Good afternoon, everyone, and thank you for standing by. Welcome to Evolus' Third Quarter Earnings Conference Call. [Operator Instructions] As a reminder, today's conference is being recorded and webcast live. [Operator Instructions]

I would now like to turn the conference over to Nareg Sagherian, Vice President and Head of Global Investor Relations and Corporate Communications. Please go ahead.

Thank you, operator, and welcome to everyone joining us on today's call to review Evolus' third quarter financial results. Our third quarter press release is now on our website at evolus.com. With me today are David Moatazedi, President and Chief Executive Officer; Tatjana Mitchell, Chief Financial Officer; and Rui Avelar, Chief Medical Officer and Head of R&D.

Today's call will include forward-looking statements. Actual results may differ materially due to risks and uncertainties outlined in our earnings press release and SEC filings. These forward-looking statements are based on current assumptions, and we undertake no obligation to update them. Additionally, we will discuss certain non-GAAP financial measures. These measures should be considered in addition to and not as a substitute for our GAAP results. A reconciliation of GAAP to non-GAAP measures is included in today's earnings release. As a reminder, our earnings release and SEC filings are available on the SEC's website and on our Investor Relations website. Following the conclusion of today's call, a replay will be available on our website at investors.evolus.com.

With that, I'll turn the call over to our CEO, David Moatazedi.

Thank you, Nareg, and good afternoon, everyone. Before we begin, I'd like to take a moment to welcome Tatjana Mitchell as our new Chief Financial Officer. Tatjana brings deep financial and operational expertise to Evolus, and she's made an immediate impact as we strengthen our focus on efficiency and long-term growth.

The third quarter marks an important transition for Evolus. And before I discuss the results, I want to take a moment to recognize the outstanding efforts of our team. Over the past year, we successfully created or expanded a number of capabilities, solidifying the foundation for long-term growth. Most notably, our medical education platform has evolved into a comprehensive training ecosystem, working with world-renowned experts in the field of aesthetics to engage more than 17,000 injectors year-to-date through cadaver labs, in-office hands-on sessions, mobile training with our Evolus bots across 100 events and digital webcasts.

Our Evolus consumer loyalty program has now grown to more than 1.3 million members, up 34% year-on-year, with nearly 70% returning customers, underscoring the strength of our consumer engagement. Our first-in-class Evolux co-branded media program has reached over 1,400 accounts year-to-date and generated over 300 million media impressions to digital, billboard and streaming campaigns, further amplifying awareness of the Evolus brand.

Our Evolysse launch is off to an incredible start. To date, more than 4,000 customers have completed hands-on training and the majority have purchased Evolysse. One of the key insights we've learned is that first training builds familiarity and comfort with the product, while the second training is what drives meaningful adoption. In fact, 75% of Evolysse revenue comes from accounts that have participated in hands-on training, and we've seen a 100% increase in purchasing volume when an account is trained the second time. This clearly underscores the value of continued education in building product confidence and driving consistent use.

Internationally, we entered 2 new markets this year, and our mature markets are continuing to grow at a very high rate. In the U.K., our most mature direct market, we estimate that our market share closely mirrors the share uptake we experienced in the U.S. following launch.

Lastly, despite the headwinds in the U.S. aesthetic market Jeuveau continues to outperform the category with unit volume growing year-to-date and on track to continue that trajectory in a market that remains down single digits this year.

Our above-market performance and disciplined expense management have positioned us to enter the next phase of our growth trajectory. Achieving profitability in the fourth quarter of 2025 and positioning us for sustainable annual profitability beginning in 2026. We've rebased our expenses with the benefits reflected in our third quarter results and remain well positioned to deliver sustainable profitability.

While the aesthetic market continues to face near-term challenges related to consumer spending, we're encouraged by early signs of stabilization and expect demand for injectables to continue to improve sequentially. Against this backdrop, Evolus continues to deliver results that demonstrate the strength of our strategy and the resilience of our brand. In the third quarter, our revenue increased 13% due to strong global Jeuveau demand and meaningful early contribution from Evolysse in the U.S.

Following a challenging second quarter, global Jeuveau performance in the third quarter reflected healthy demand as the business experienced sequential revenue growth in what is typically a seasonally lower quarter. Jeuveau sales benefited from positive unit growth, both in the U.S. and internationally, supported by record consumer demand through our Evolus Rewards program. As the market strengthens and the overall toxin category returns to growth, Jeuveau is poised to regain healthy momentum. We strengthened our 14% share of the U.S. market year-to-date, reinforcing the synergy within our portfolio and our differentiated positioning as a leader in performance beauty.

With Evolysse, we continue to lay the foundation for adoption and scale, delivering $5.7 million revenue in the third quarter and $15.5 million since launch, marking the strongest HA filler debut in over a decade. Demand for Evolysse increased sequentially over the run rate of approximately $5 million after factoring for initial stocking by accounts in our launch quarter. We're particularly excited about the performance of Evolysse as feedback from customers has been exceptional, highlighting the product handling, results and seamless integration in their practice. This further validates our Beauty First strategy to build a full facial aesthetics portfolio under a single trusted brand.

Through this launch, we targeted our highest volume Jeuveau accounts and gained valuable insights that will aid us as we now expand our focus to a broader customer base in the fourth quarter. Our launch-to-date strategy was focused on establishing Evolysse as a differentiated product independent from Jeuveau. And we intentionally avoided bundling during this initial phase. As we approach 6 months of experience with Evolysse on the market and as practices are now planning for the new year, the fourth quarter is the right time to bring the value of our 2 portfolio products together.

This quarter, we have introduced our first Evolus portfolio bundle designed to reward practices that grow across both Jeuveau and Evolysse. This initiative enables us to compete more directly against competitive bundles and drive market share gains across the portfolio.

In the third quarter, we expanded our customer base by adding nearly 500 new purchasing accounts, bringing our total to more than 17,000, 2,000 of which are now also purchasing Evolysse. Our Evolus Rewards consumer loyalty program remains a central growth driver, fueling both repeat use and brand engagement. Total redemptions grew 34% compared to the prior year quarter. New redemptions for the quarter were a record 244,000, of which approximately 68% came from existing consumers. Jeuveau and Evolysse are building lasting consumer loyalty, which fuels a sustainable growth and profitability of our portfolio.

In parallel with our commercial execution, we achieved a key regulatory milestone with the submission of our PMA to the U.S. FDA for Evolysse Sculpt, our advanced injectable HA sculpt for mid-face volume restoration. We expect the FDA review to follow the standard PMA pathway with potential approval anticipated in the second half of 2026.

We also remain on track for a broader launch of a steam in Europe in the first half of 2026.

Before I close, I'd like to address the recent developments related to tariffs. We've taken proactive measures to mitigate potential tariff impact on pharmaceuticals, including Jeuveau. We will provide additional clarity once the trade agreement with South Korea and pharmaceutical tariffs are finalized. But the current time line gives us a valuable window to strategically plan and prepare for any changes. We remain confident in our ability to navigate these dynamics effectively without disruption to our customers or our financial performance.

In summary, our third quarter results reflect above-market growth, financial discipline and the early benefits of our expanding portfolio. With Jeuveau performing steadily, Evolysse building scale, as team on track for launch in 2026 and the resetting of our expense base, Evolus remains well positioned to achieve sustainable profitability and long-term growth.

With that, I'll turn it over to Rui for an update on Evolysse and our recent Sculpt submission.

Thank you, David. Since the launch of Form and Smooth here in the U.S., the feedback continues to be consistent. This line of gels are described as being efficient in that a given amount of product goes a long way. They have a low inflammatory profile and are very versatile.

On the development side, Evolysse Sculpt is our HA injectable that targets the premium mid-face volume market and is currently making its way through the FDA process. In August, the first disclosure of the data was presented. The study compared Sculpt to Restylane Lyft in a prospective double-blind randomized trial and enrolled 304 patients in a 3:1 ratio. Using a validated 5-point scale, patients with moderate, severe or extreme mid-face volume deficit were eligible for treatment, then followed for 24 months.

The primary endpoint was non-inferiority design measured at 6 months and looked at the difference in mean change in mid-face volume deficit scores after treatment. Patients were treated in the cheek area and the mean volume of HA product used was 1.8 mls per cheek or 3.7 mls per patient. The primary endpoint of non-inferiority was met with the difference in favor of Evolysse Sculpt. The confidence intervals demonstrated both non-inferiority and statistical superiority. The corresponding p-value also demonstrated statistical superiority at less than 0.001.

The secondary endpoint looked at responder rates of each treated cheek, defined as at least a 1-point improvement on the scale. At 6 months, 83% of cheeks treated with Restylane Lyft were responders compared to 91% in the Evolysse Sculpt Group, with the p value that reached the level of statistical significance at 0.015. Following the patients over the course of 2 years, there was a pattern of increasing separation across the efficacy metrics over time between the 2 groups, favoring Evolysse Sculpt over the control. A 1 point change on the validated volume deficit scale represents a clinically meaningful improvement.

Looking at patients with at least a 1-point change as assessed by the blinded evaluator at 24 months or the study's end, 8% of Lyft patients were responders compared to 29% of Sculpt patients over a threefold difference at the end of 2 years. The pattern was similar when looking at the global aesthetic improvement scale as assessed by the patients themselves. At 24 months, 13% of Lyft patients were responders compared to 29% of Sculpt patients. Treatment-related adverse events between the 2 groups were similar, 18.7% for Lyft and 19.7% for Sculpt, and there were no treatment-related serious adverse events in either of the groups during the trial. As mentioned, the PMA for Sculpt was submitted in the third quarter of this year, and we anticipate FDA approval in the second half of 2026.

Lastly, the Lyft HA injectable trial is fully enrolled, ongoing, and we anticipate its approval and launch in 2027.

With that, I'll turn it over to Tatjana to walk you through the financial details.

Thank you, Rui, and thank you, David, for the warm welcome. Over the past 60 days, I have had the opportunity to get to know the Evolus team and spend time with some of our customers. It's been energizing to see firsthand what makes this company unique. And I wanted to share a few observations before we move into the results.

First, Evolus has a highly differentiated business model. As a cash pay-focused company in a multibillion dollar aesthetics market, we have built meaningful relationships with both customers and consumers. Our ability to connect with both groups driving customer growth and retention while deepening consumer loyalty gives us a multitude of levers to drive performance. Based on my experience and scale consumer businesses, Evolus is still in the early stages of realizing our full potential.

Second, the fundamentals of our business are strong. We have built productive long-term partnerships with Daewoong and Symatese, and our expense base has been successfully rebased following the second quarter, all while continuing to deliver on our revenue targets. This positions us well to drive operating leverage and profitability going forward.

Third, we operate in a high-growth category with long-term secular tailwinds. Our strategy of building a facial aesthetics portfolio under one trusted brand provides a strong foundation for continued expansion and innovation. We are confident in delivering profitability with our current portfolio while actively pursuing strategic business development opportunities to expand our pipeline.

And finally, I've been impressed by the strength of the Evolus culture. The grit and focus on impact that I've seen across the organization are what makes me confident in our ability to deliver on our long-term goals.

I'm joining Evolus at a pivotal moment, one where the foundation is strong, the opportunity is clear and the team is focused on execution. I look forward to partnering with David and the leadership team to drive profitable growth and long-term value for our shareholders.

With that, I'm pleased to share our third quarter financial results. Global net revenue for the third quarter was $69 million, a 13% increase over the third quarter of 2024.

Sales growth in the third quarter was driven by a combination of the introduction of Evolysse and growth in global Jeuveau. And on a sequential basis, sales growth in the third quarter was driven by accelerating demand for Jeuveau, increasing underlying demand for Evolysse and continued strength in the international business.

Net revenue for the third quarter of 2025 included $63.2 million of global Jeuveau revenue and $5.7 million of Evolysse revenue.

Our reported gross margin for the third quarter was 66.5% and adjusted gross margin was 67.6%, which excludes the amortization of intangibles.

Earlier, we touched on the topic of tariffs. There have been recent announcements related to potential tariffs on pharmaceutical products. At this time, the impact on Jeuveau is still being evaluated, pending additional guidance by the administration. Current inventory levels will sustain us through the first quarter of 2026, and therefore, Jeuveau will not be subject to any near-term tariff impact.

Separately, under the recently announced trade agreement with the European Union, Evolysse is subject to a 15% tariff that began August 7. This star has been fully incorporated into our outlook and has a minimal impact on our financials. We continue to actively monitor global trade agreements and remain focused on mitigating any potential future exposure while ensuring stable supply for our customers.

Moving now to operating expenses. GAAP operating expenses for the third quarter were $57.3 million, up from $55.5 million in the second quarter. As a note, on the sequential comparison, Q2 2025 GAAP operating expenses benefited from a $3.9 million reduction related to the revaluation of the contingent royalty obligation.

Non-GAAP operating expenses for the third quarter were $49.7 million compared to $54 million in the second quarter. As a reminder, non-GAAP operating expenses exclude stock-based compensation, revaluation of the contingent royalty obligation and depreciation and amortization. This quarter, non-GAAP operating expenses also exclude $1.4 million in restructuring charges, primarily consisting of onetime severance benefits for inactive employees. These restructuring expenses are related to the strategic cost structure optimization announced in August.

Within operating expenses, selling, general and administrative expenses for the third quarter were $52.8 million compared to $56.7 million in the second quarter. This included $5 million of noncash stock-based compensation compared to $4.3 million in the prior quarter.

Non-GAAP operating loss in the third quarter was $3.1 million compared to non-GAAP operating loss of $6.7 million in Q3 of 2024.

The better-than-expected third quarter results was due to operating expense reduction and in part to the timing of our largest customer event of the year, which moves from Q3 to Q4. As a result of this timing shift, the associated costs of the customer rent will be recognized in the fourth quarter rather than the third while the full year impact remains unchanged.

Lowest non-GAAP operating expenses and non-GAAP operating income excludes stock-based compensation expense, revaluation of the contingent royalty obligation, depreciation and amortization and restructuring charges. Non-GAAP operating income also excludes amortization of intangible assets.

Turning to the balance sheet. We ended the third quarter with $43.5 million in cash as compared with $61.7 million at the end of the second quarter. The decrease in cash during the quarter was primarily driven by our decision to pull forward inventory purchases ahead of potential tariffs on pharmaceuticals.

Looking ahead, underpinned by our strong third quarter performance, our outlook for 2025 remains unchanged and includes the following. Reiterating total net revenue between $295 million and $305 million, representing 11% to 15% growth over 2024 results. We continue to expect Evolysse revenue contribution to be between 10% and 12% of total revenue for the full year 2025.

Full year non-GAAP operating expenses to remain between $208 million and $213 million. Non-GAAP operating income between $5 million and $7 million in Q4 2025, which includes the timing of costs related to our customer events that shifted from the third quarter to the fourth quarter. In addition to our continued expectation to achieve profitability in the fourth quarter of 2025, we also remain on track to achieve sustainable annual profitability beginning in 2026.

With that, I will now turn the call back to David for closing comments.

Thank you, Tatjana. Amid a challenging macro backdrop, our double-digit growth reflects the strength of our business fundamentals and the consistency of our execution. We're a company operating with focus and efficiency, maintaining financial discipline while advancing on one of the most differentiated injectable pipeline in aesthetics. As we move into the fourth quarter, we're deepening customer engagement with the introduction of our Evolysse portfolio bundle, which aligns incentives and drives growth across our injectable portfolio.

With Jeuveau in the #3 share position and gaming on the market leader, Evolysse in the early stages of scaling and a theme set to launch in Europe in the first half of 2026, we are well positioned to deliver sustainable growth, profitability and long-term shareholder value.

Operator, you may now begin the Q&A.

[Operator Instructions] Our first question comes from the line of Annabel Samimy with Stifel.

A great recovery on the quarter. I just wanted to ask you some questions about, I guess, the solar dynamic on Evolysse, how much of what you're seeing for Evolysse includes a headwind for stocking versus seasonality versus, say, market sentiment? I guess maybe some macro commentary could be useful here. Like, for example, has sentiment shifted? Is sentiment still poor for fillers? Or are you seeing meaningful headwind from free product for injectors to trial? And could you potentially quantify any of this?

And I guess from here, can you sort of give us a better sense of what we can expect of the cadence? And then just -- that was a lot of questions, but one more on this. I guess you mentioned there were about 4,000 trained and 2,000 have adopted Evolysse. Do you have any metrics for the time that it takes to go from like, say, first training to second training into adoption? How should we think about the conversion of those patients -- those physicians who have initially trained?

Great. All really good questions, Annabel, around Evolysse. And I'll try to maybe dimensionalize for you for just a minute. If we take a couple of steps back, the one thing I'd say is when we launched, we focused initially on our core Evolus customers. And I'm really proud that in our first 6 months, when we look at our Jeuveau revenue, half of our revenue for Jeuveau has purchased Evolysse. So I think our focus on that, Evolysse customer set has been very productive for us. To your point, the recipe that we've uncovered, that has been effective, is to expose them to the product through our sales force, bring them in for training. One live hands-on training is very useful for them to have enough confidence to start trialing the product in their patients. But it really is consistently that second training that changes from trialing the product or dabbling with it to turning into an adopter. And that is really the key insight that we gained over the last couple of quarters with this product.

We see a significant inflection point in those clinics when they get through that second training. As you can imagine, the first quarter that we launched, we had very few that actually had the opportunity to get trained 2 times. And so we started to see that more in the third quarter. And you could expect a number of those trainings. Second trainings are booked in the fourth quarter. That's a very significant part of the uptick within our core group.

The second is in the fourth quarter, now that we've learned this product, and keep in mind, the U.S. is the first market that's launched Evolysse. So we're relying on our learnings here in the U.S. to continue to adapt our launch. We've now opened the door for Evolysse to go wider beyond our current Evolus customer base. And so you'll see the results from us being able to replicate what we've done over the first 6 months with our core customer group to a broader audience of customers. That's the second.

And then lastly, as you pointed out, on the full year, the HA market, as we've read reports from our peers in the space, the market is down double digits. It continues to be relatively challenged, partly due to the macro environment. At the same time, Q3 is the seasonally low period for injectables as well. So you sort of have a compounding effect, if you will, and that's unique to the third quarter. Whereas in contrast, the fourth quarter, we expect will be the strongest quarter of the year, and will be now 3 quarters into our launch. So as we think about our guide for the full year, it reflects those market dynamics of those -- the fourth quarter being sort of the culmination now of 6 months of experience, our key learnings on the product and the benefit of the seasonality working favorably for us.

Our next question comes from the line of Marc Goodman with Leerink Partners.

This is Alyssa Larios on for Marc Goodman. Just a few questions from us. Could you comment on the usage trends between Evolysse Smooth and Form and how those 2 different product lines are being used across the consumer base? And then can you give us an update on the advertising campaign and remind us exactly what channels you're using, whether it's DTC or going directly to the clinics themselves? And then finally, you mentioned that you intentionally avoided bundling the filler and toxin in the initial phase. Just curious what the rationale was for doing that. If you can walk us through your thought process? That's it.

Great. Why don't I start with bundling the advertising, and then I'll comment on the usage of Smooth and Form. I'd like to Rui to add his color. Both Rui and I spent a lot of time with customers, trying to understand how they do position it, and there are some interesting insights there. So just on the bundling piece, it became very clear to us as we're preparing for the launch of Evolysse that customers weren't looking for us to bring in new product to market and sort of force it on them because there are customers that use our primary product, Jeuveau. And instead, following a number of advisory board meetings and looking at prior product launches, we chose to take a different route, which has let the product stand on its own and allow these customers a period of multiple quarters to learn through the product before we start to think about bringing our portfolio together.

So it was very deliberate in the first quarter that we launched. The product was entirely independent. In the second quarter, we introduced consumer loyalty. We didn't want to introduce that too early. We wanted accounts to get comfort with the usage of the product before we expose consumers to the loyalty benefit. And now in our third quarter following launch, it's not the right time where customers are asking us about what the future of our portfolio is. As you can imagine, they are currently partnered with the larger companies, and they commit to these larger portfolio of purchases as part of their ongoing commitment to gain better pricing. Today, by keeping them independent, there's no advantage to bringing the full portfolio under Evolus.

And so we provided this growth portfolio bundle offering in the fourth quarter as our first test of how we'll bring the portfolios together. And this will carry through into next year. And so this is our first attempt of doing that. And I can tell you that we tested it in one of our larger customer meetings that Tatiana mentioned, that was a result of the phasing of spend in and it was very, very successful in terms of the reception we got to it.

On the DTC side, look, our strategy is more focused around co-branded media. So all of the advertising we do is surrounding each clinic individually. And we've been able to build a model with Evolus where we do personalization at scale. And part of that personalization is around our co-branded media in the form of streaming TV spots, billboards within local markets. And the heaviest portion of it is digital media. That could be social, it could be search and it does vary by market. And as I said, there are over 1,400 accounts that have participated in our co-branded media benefits. So it's not an insignificant portion of our customer base, but they have to meet certain purchasing criteria to gain those benefits.

And so -- and then lastly, on the usage of Smooth and Form, both products have the same indication, which is the nasolabial fold, but the properties of the gels are very different. And we're learning more and more about their personalities as injectors are generally purchasing both. We have very few that are entirely using one or the other, mainly because the property is a smoother, that's a softer gel, whereas the Form product provides more structure. And so our label may be limited nasolabial fold, but of course, the usage expands beyond that. And so what we're hearing consistently is whether looking for a product to fill in areas more -- to create more of a smoothing effect, that's where they're leaning towards smooth. And when they're looking for greater structure in a product, that's where they're reaching for the Form. But I'll ask to share his part, Rui?

Sure. I'm going to paraphrase a little bit. The indication is actually broader. The indication is medium to deep wrinkles and folds. And the nasolabial fold is one example of that. You can also go into the marionette lines. And if you look under that lower lip, sometimes there's a deep fold in there, it's called the submental fold. And there's a lot of versatility with these products. And when a clinician looks at a wrinkle or a fold, for example, nasolabial fold is one example, they can look at it strategically and think I'm taking all the attributes of this patient. Are they thin? Are they heavy? Skin quality, all these different things. And if their strategy is to try to use something more superficially, then they'll reach for Smooth. It's got a rheological profile that's very soft and you can bring it up very superficial.

If the strategy is different and you want to create a little bit more lift and you need some more lifting power, your strategy is going to be deeper. So you go into Form. And sometimes you combine the 2, you layer them. You want something with more lift underneath and you want to smooth that out. So that's one group.

And then in Europe, Smooth is actually approved for perioral fine lines and off-label here in the United States. But we're living in a global environment and people understand that, that product can be used so superficially that it will be used in parallel lines.

And the other thing that's come in that's been very interesting is a recurrent comment that these gels are incredibly efficient. And what they typically say is I reach for a gel and I may go for something that needs more lift such as a Form. And I get done, and I still have product left over. And this product is so forgiving that I can continue through different parts of the area or even go superficial in the area that typically couldn't with the gel that has these properties. So that's been the feedback so far. For us, that was kind of reassuring because it was very consistent with the feedback we got before we brought the product on, and that's always nice to see that confirmation.

Our next question comes from the line of Navann Ty with BNP Paribas.

First, can you discuss in more detail the Q3 action underlying the sequential growth for Jeuveau despite the seasonality, including that Evolus Day event and practices support and potential promotional activities and whether you expect similar actions in Q4 such as the 11th day?

And then second, we know that AbbVie commented on the Q3 call that their middle income customers for BOTOX are on the sidelines. So can you discuss the early signs of consumer stabilization that you are seeing?

Sure. Thanks for the question, Navann. I think what we saw in the second quarter, as we commented before, was a unique point at the end of the quarter where we saw a pullback in customer purchasing that was really unique to the second quarter that we hadn't observed before. We did not see that dynamic in the third. We maintained a consistent promotional effort and we always do, both on the consumer side, through our loyalty platform where we did engage consumers that we saw stretching their intervals between treatment with a way to bring them back into their normal routine.

We also were able to do some things in the market around the clinics with partnerships. We did have a partnership with consumer magazine, Allure, where there was a gift with purchase that consumers were able to partner with us on that did drive a lot of interest in our product. And then, of course, now as we enter the fourth quarter, as you pointed out, this is our annual 11th day, which kicked off towards the end of October. And it's we're in the middle of it now, and it's a very important phase for us as our customers look at that annually.

Our next question comes from the line of Uy Ear with Mizuho Securities.

Congrats on the positive quarter here. So maybe a question on, well, could you maybe just tell us the split between U.S. and ex U.S. sales for Jeuveau? And maybe you can also kind of help us understand, I think you indicated that you strengthened your 14% market share. Maybe just help us understand what you mean by that as well as what are you kind of seeing, I guess, in terms of your customer base who are -- who could be different from what AbbVie -- the customer base that AbbVie or Galderma have?

Yes. Let's start with what we're seeing in terms of just overall in the market. Obviously, the only 2 companies that report down the revenue and break out that level of detail is both us and AbbVie. So through that, what we see is a market that in the third quarter, likely decline by some small degree and we continue to outpace when you look at our year-to-date Jeuveau in the declining market, we've grown in terms of units.

What's probably most promising is you see our consumer rewards data where the overall redemption, that's consumers going in, getting treated and earning their $40 off, it's up over 30% year-on-year. So we continue to see very healthy demand for the product in these clinics and we're continuing to, we believe, improve our presence there. Now that all at the same time, we're establishing Evolysse in these clinics. So overall, we feel very good about how Jeuveau has performed out of the third quarter. And we hope to see that momentum continue.

The second part was, yes, that was the 14%. Yes. As far as the -- we don't do segment reporting on the toxin business, Uy. So unfortunately, we won't be able to give you that color. But we did in the script make the comment that both the U.S. and the international business are growing positive in terms of units year-to-date. So I think it gives you some color around there is growth happening on both sides on top of that, Uy.

Okay. Can I sneak in another question. You're now going to bundle the product. Maybe just help us understand the potential synergies that you could get from this? Do you expect in some of the accounts, I think you're heavily penetrated. In terms of Jeuveau, do you expect greater -- significantly greater penetration there? Or do you think the synergies will work -- sort of will be greater synergies in terms of Evolysse? Just help us understand the dynamic and the potential and the magnitude.

Yes. I think my view is the portfolio bundle is a long play for us. This is a very early innings. We've been operating as a single product company and without a bundle for 7 years, and you've seen us establish. Jeuveau is the fastest-growing brand for the majority of those years since we entered the market. And we're the first company to break through the double-digit mark outside of the initial 2 players to enter the space. We do believe this is a meaningful opportunity for Jeuveau.

There are countless conversations that we've had with clinics where their Jeuveau usage is limited by the downside risk they have by moving over more of their share to us on their total purchasing with some of the competitive products. The idea of a bundle unlocks and alleviate some of that pressure. And I think the reason I say it's a longer-term endeavor is because Sculpt further unlocks it because it further expands our portfolio within the HA space, which is an important part of continuing to move more of their business over. So I view the fourth quarter as the first of many quarters to come where we'll start talking a little bit more about the advantage of the portfolio.

Our next question comes from the line of Douglas Tsao with H.C. Wainwright.

Congrats on the progress. David, I guess, I'm just curious, have you seen that effect yet in the marketplace, meaning sort of accounts that were perhaps not purchasing Jeuveau because they were very defensive around sort of the bundle with Allergan or AbbVie and now are beginning to be able to purchase Jeuveau as well as Evolysse? Or is that more of the sort of a conversation that you're starting to have?

Yes. We have had a combination of both inbound interest from accounts that weren't working with us on Jeuveau and they're interested in Evolysse and that opens the door for us to begin partnering with them. Now keep in mind, Evolysse is still early. So I think some of those could be dabblers that will continue to expand their presence. And as a result of that, they've started to dabble with Jeuveau. So that's one group of customers.

Another group are customers that have been somewhat moderate users of Jeuveau. And now with Evolysse, they're looking at us differently. And consistently in the conversation is the idea of having a mid-face product, that bringing in a differentiated mid-face product, which is a big gap in a lot of portfolios in our industry is going to be a significant point in time to do that. So we've used this, if you will, in 3 stages, right? The first 6 months was establishing Evolysse. The next 6 months is starting to establish our portfolio value proposition and then opening the doors to follow as Sculpt gets to approval, and then we can really use that entire bundle to start to take advantage of it. So we've been deliberate about how we've tried to roll these out, especially to support our customers who've helped us get here.

And as a follow-up, David, I'm just curious, on the co-branded marketing side, is Jeuveau remaining the focal point? Or have you had accounts inquire or begin to actually do co-branded marketing where Evolysse is the focus?

Yes. So the third quarter, we started to put out co-branded media on Evolysse. Some of those co-branded media ads had mentioned the weight loss. As you know, we're the only hyaluronic acid that has mention of weight loss in our label. There's a lot of interest. Some of those in our billboards now sitting around the U.S., some of them are digital media. And that was one that many [Technical Difficulty].

Hello?

Yes. We're back, Doug.

I think, David, we lost you midstream about the co-branded marketing.

Yes. My only comment there was, we are seeing co-branded marketing on Evolysse in the form of billboards as well as digital with a number of them having the mention of weight loss, which is unique to our product. And as we mentioned on the prior call, the more you purchase from Evolysse, the more co-branded media dollars you earn. And then our team works with those clinics to choose which products they want to highlight between the 2, Jeuveau and Evolysse. And we started to introduce it in the third quarter in the market, and it's going to continue to rise as we enter the fourth quarter.

Our next question comes from the line of Serge Belanger with Needham & Company.

David, first question is on ordering patterns. Like you mentioned earlier, volumes and size of orders kind of dropped off at the end of the second quarter. Just curious what impact that had on inventory levels and the overall ordering pattern throughout 3Q? And maybe what you've seen in the early part of 4Q right now?

Secondly, I think Tatjana mentioned that the customer event was moved from 3Q to 4Q. I imagine that's the 11-day promotion. What impact did that have on OpEx? And could that be another tailwind for 4Q Jeuveau sales?

Apologies. The speakers are experiencing more technical difficulties.

Serge, can you let me know where we cut off? Can you let me know where my response cut off?

I don't think we heard your response at all.

Okay. Apologies. We are dealing with some technical difficulties, but we are back on. So the question was around the customer event that moved from Q3 to Q4. That was the summit that we have for our largest customers. It was not the 11th-day promotion. So the 11th-day promotion, as David said, kicked off at the end of October and is currently underway. And so there's no change in promotional cadence or any impact on revenue.

Okay. And to your -- second part of your question around purchasing pattern, Serge. A couple of things that we pointed out coming out of the Q2 earnings call. One is that accounts were drawing down their inventory. We expected that to continue through the third quarter. And so what we're seeing were accounts that are carrying less inventory and purchasing more on an on-demand basis versus placing sort of the larger volume orders that they had been placing before. But collectively, we saw them coming through strong just with over the course of more orders rather than the bigger volume ones.

Now the fourth quarter is at the busiest season. So we do expect that the purchase volumes are generally higher. They will be higher than they have been over the past 2 quarters. But we do expect that inventory levels will continue to be managed carefully in the space as the overall volumes year-on-year. We expect the fourth quarter hopefully to be relatively flat coming off of a depressed base. So we expect it to be relatively stable.

Our next question comes from the line of Sam Eiber with BTIG.

Maybe I can move to the tariff mitigation strategies that you called out in the prepared remarks. So I'd love to hear any more details. I guess you could provide on potential offsets if we do get tariffs. I know it's a fluid situation, but would love your thoughts there. And maybe as a follow-up, if we do get potentially material rates, what's your ability to, I guess, build in the U.S., manufacture in the U.S.? How long something like that could take to build out? Any thoughts there would be great.

Yes, Sam, it's a great question on tariffs. Like you, we've also been watching this very closely. And I want to be careful not to get into too much detail here because it's harder to lay out plans when it's not entirely clear yet. The Korean trade agreement is nearing a close. So we're looking forward to seeing that agreement finalized, but the pharmaceutical tariffs and whether those continue to hold are still not yet clear.

I can tell you that we have an incredible partnership with our partner, Daewoong in Korea. They're very well aware of the impact of tariffs, the conversations we've had with them. And they've also been very supportive. As you see, on one hand, there's been a higher impact on our cash burn as a result of pulling forward inventory into the U.S. That allows us and affords us the luxury of time to be able to get more clarity on some of these unknown items. But as you can imagine, we're working through it in scenario planning. So rather than going through each of those scenarios, I can tell you that we have a partner that's committed. We have the luxury of time to work through this. And it's still unclear within that range of options, I would just say that we are open to exploring...

Apologies. Looks like we lost him again. There are no further questions at this time. I'd like to pass the call back over to Nareg Sagherian for details on an upcoming IR event. Nareg?

We hope to see many of you there. Thank you for joining us today.

This concludes today's teleconference. You may now disconnect your lines.