Good afternoon, everyone, and thank you for standing by. Welcome to Evelus' third quarter earnings conference call. As a reminder, today's conference is being recorded and webcast live. All participants are in a listen-only mode. After the speaker's remarks, there will be a question-and-answer session. If you'd like to enter the queue at any time, please press star 1 on your telephone keypad. I would now like to turn the conference over to your host, Nareg Sagherian.

Thank you, Operator, and welcome to everyone joining us on today's call to review Avalos' third quarter financial results. Our third quarter press release is now available on the investor relations section of our website at avalos.com. Joining me on today's call are David Moatazedi, President and Chief Executive Officer, Rui Avelar, Chief Medical Officer and Head of R&D, and Tatjana Mitchell, Chief Financial Officer. 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.avelus.com. With that, I'll turn the call over to our CEO, David Moatazedi.

Thank you, Nareg, and good afternoon, everyone. I'm pleased to report our fourth consecutive quarter of positive adjusted EBITDA and continued above-market growth while continuing to expand our portfolio with differentiated assets. These results reflect our deliberate strategy to build on the strength of our established brand while creating additional opportunities for long-term growth. Avelus is now a more diversified global performance beauty company with a growing international commercial portfolio, an expanding pipeline, and improving financial performance. At the beginning of the year, we outlined three priorities to guide our progress, commercial execution, Financial Discipline, and Pipeline Expansion. Let me update you on each priority. On Commercial Execution, Global Toxin Revenue grew approximately 11% both in the third quarter and year-to-date, while our newly launched HA Business grew nearly 40% in the quarter and more than 50% year-to-date. On Financial Discipline, We delivered our fourth consecutive quarter of positive adjusted EBITDA while continuing to invest in our commercial priorities and portfolio development. Importantly, through the first nine months, revenue grew 14% while we maintained nearly flat non-GAAP operating expenses, demonstrating the outstanding leverage of our portfolio of products. On pipeline expansion, We've added skin quality as a third pillar within our U.S. facial injectable pipeline through our partnership with IFSA for Profilo. We also recently announced an early-stage option agreement in procedure-based injectable hair growth, which adds a longer-term opportunity in a complementary aesthetic category. Turning to the quarter, we are operating in a healthy global aesthetics market. with consumers continuing to prioritize beauty and their appearance despite softer consumer confidence. We believe the category is strengthening in the U.S., supported in part by broader adoption of GLP-1 therapies, which is bringing new patients into aesthetic practices and creating additional treatment needs following weight loss. These strong tailwinds reinforce our confidence in the opportunity ahead. We delivered $78 million in revenue in the third quarter, up 13% year-on-year. Through the first nine months, adjusted EBITDA reached positive $6.4 million compared with a loss of $16.5 million a year ago, an improvement of approximately $23 million. These results demonstrate our progress in translating commercial growth into improved financial performance while continuing to make investments in the business. Javeau remains the foundation of our commercial platform. Its continued growth reflects our focus on customer experience, clinical education, and consumer loyalty, which supports, share gains, and strengthens our relationships with aesthetic practices. As we expand the portfolio, our established relationships and infrastructure have provided an opportunity to introduce complementary bands and become a more meaningful partner for our clinics. We are seeing that opportunity develop with our Evelisse portfolio. More than 4,500 customers have now purchased Evelisse, providing a foundation for continued adoption and increased utilization within practices. Our focus remains on building confidence with the portfolio through education, service, and experience with the product. As we did with Jouveau, we are converting initial adoption into sustained use. increasing the overall value of our partnership within aesthetic practices. Our growth continues to be supported by an expanding customer base and sustained consumer engagement. During the quarter, we added over 500 purchasing accounts, bringing our cumulative customer base to more than 19,000. Avalyst Rewards membership grew 23% year-over-year to more than 1.6 million consumers. with approximately 70% of existing patients returning for repeat treatment. Together, these trends demonstrate our ability to attract new patients to practices and build the loyalty that supports sustained growth as we continue to expand the portfolio. Internationally, we are extending the same portfolio approach. Following the successful launch of Esteem in Europe, we expanded our relationship with Cimetase in August to include Canada, Australia, and New Zealand. We now hold exclusive rights to the Avelis portfolio in every market where we currently offer Jouveau and Nuciva. Strategically, this alignment gives us the opportunity to build a consistent multi-product offering across our global business with a broader set of brands supported by our existing commercial infrastructure. Our financial performance this year demonstrates the operating leverage that makes this portfolio strategy compelling. We are growing revenue and improving profitability through a platform designed to support multiple injectable brands. Additional products can address more treatment needs within the same practices, allowing us to build on existing customer relationships, digital capabilities, and commercial infrastructure. This platform provides a commercial foundation for the next stage of our US portfolio. As we look ahead, we plan to introduce three additional products over the next four years. This expansion builds on Juveau and the first two formulations of Evelisse. Within Evelisse, we expect Sculpt to be our next launch, followed by Lips. Beyond these launches, our partnership with IPSA supports U.S. development and commercialization of Profilo, the market-leading skin-quality injectable in Europe. We are also building opportunities beyond that launch horizon. Our early-stage option agreement in procedure-based injectable hair growth adds a longer-term opportunity that is complementary to the aesthetic practices we serve. This gives us a portfolio spanning established commercial products, products advancing toward anticipated launches, and earlier-stage opportunities that can broaden our growth over time. With that, I'd like to turn the call over to Rui to talk you through the portfolio in more detail, beginning with our commercial products. He will then update you on the products advancing through development and regulatory review, followed by our longer-term opportunities.

Thank you, David. In Europe, we launched our full line of hyaluronic acid injectables under the brand name Esteem, known as Evelis here in the U.S. Our confidence in this HA line continues to build, and the feedback we're receiving remains consistent with our initial assessment. Injectors describe the gels as highly efficient in terms of correction achieved with a given amount of product, having good tissue integration, providing natural-looking results, and very dynamic, particularly in areas of tissue movement. Another consistent theme is predictability, being able to correct to the desired aesthetic outcome without having to adjust technique to account for gel swelling over time. Regarding late-stage development programs, Evely Sculpt remains under FDA review, and we continue to anticipate approval in the fourth quarter of 2026. The Evelisse LIPS program is nearing the final stages, and we anticipate submitting the PMA to the FDA before the year end. As we expand the pipeline, we continue to build on our performance beauty strategy and have consistently expressed interest in skin quality, hair growth, and biostimulators as opportunities to broaden the portfolio. On our last call, we introduced Profilo. establishing skin quality as the third category within our facial injectable portfolio. Since the announcement, we've received substantial inbound interest, particularly from U.S. injectors aware of the product in Europe, where it commands a market-leading share position. Profilo is unlike any other HA on the market and highly complementary to the Avelis injectable line. Evelis is manufactured using a traditional crosslinker and is engineered to soften features, support tissue, and create projection. Profilo is designed to address skin quality and hydrate the skin from within, which requires a different set of performance characteristics. Ipsa, the parent company, developed a unique proprietary manufacturing process to achieve this. Using the thermal process, high molecular weight HA bonds are weakened. Then during cooling, low molecular weight HA is intertwined, forming new hydrogen bonds, creating a novel stabilized hybrid complex, ideally suited to address skin quality. The FDA development program is already underway. And as a reminder, Eblis will own the PMA at the end of this process. Turning to hair growth. We recently announced an agreement that gives Evelis the option to acquire a hair growth asset. We've had clear criteria that would make an opportunity in this category attractive to us. The therapeutic needs to be locally delivered. Oral therapies become systemic, which can increase the potential for adverse events, including hair growth in unwanted parts of the body. Women are especially sensitive to this. A well-characterized therapeutic agent. Our focus is on compounds that have shown efficacy in hair growth, helping to de-risk the program. It needs to be a procedure. Our customers are skilled injectors. They want to perform procedures to deliver therapeutics, making an in-office treatment approach a natural fit with their practices. Finally, we're targeting a quarterly treatment interval. The current formulation under development is aiming for a three-month interval, complementing the cadence that practices like to see their patients. The Hair Growth Program is a longer-term blue sky pipeline opportunity, and the risk is further mitigated by the design of the arrangement. The option to acquire the company will be based on actual human data, which should be more predictive of probability of success than animal data. We will be able to see and assess the results before having to commit to the acquisition and the full development program. In summary, we continue to anticipate Sculpt launch in 2027. A lip submission this year then followed launch in early 2028. Profiler represents a midterm opportunity with approval anticipated around 2030. Together, these programs support our plans for three product launches over the next four years. Hair represents a longer-term opportunity and has the potential to become an Eblis fully owned asset, where we would own it from manufacturing to final sale of the product. On biostimulators, we remain active in discussions with potential assets while maintaining discipline around the terms and the structure of any agreement we pursue. With that, I'll turn the call over to Tatjana.

Thank you, Rui. Our third quarter results reflect continued progress in translating revenue growth into improved operating margins. I'll walk through the quarterly and year-to-date results discussed our capital position and explained how our outlook balances expense discipline with continued investment in commercial priorities and portfolio development. During the quarter, we delivered 13% revenue growth in our fourth consecutive quarter of positive adjusted EBITDA, with a $4 million improvement over the prior year. Through the first nine months, revenue grew 14%, while non-GAAP operating expenses were reduced by 2.5% and adjusted EBITDA improved by $23 million compared with the same prior year period. These year-to-date results demonstrate the cumulative benefit of sustained revenue growth and operating leverage in our model. Taken together, our top-line performance and disciplined approach to investment support our confidence in our full-year outlook and in our progress toward our longer-term financial objectives. Beginning with revenue. Global net revenue for the third quarter was 78 million, representing a 13% increase compared with the prior year period. This included 70.1 million of global stocks and revenue and 7.9 million from injectable HHLs. Through the first nine months, net revenue was $235.2 million, up 14% year-over-year. Turning to gross margin. Reported gross margin for the third quarter was 65%, while adjusted gross margin, which excludes amortization of intangible assets, was 66.1%. Year-to-date, gross margins remained flat with the prior year, and our full year gross margin guidance remains unchanged. Moving to operating expenses. Third quarter GAAP operating expenses were $59.1 million compared with $61.7 million in the second quarter, while non-GAAP operating expenses were $50.3 million compared with $53.3 million in the second quarter. As a reminder, non-GAAP operating expenses exclude stock-based compensation expense, reevaluation of the contingent's royalty obligation, depreciation and amortization, and restructuring costs. Within operating expenses, selling general and administrator expenses for the third quarter were $52.9 million compared to $57.1 million in the second quarter. This included $5.3 million of non-cash stock-based compensation, similar to the prior quarter. Looking ahead, we expect operating expenses to increase sequentially in the fourth quarter. This reflects variable expense associated with seasonally higher revenue, our annual event for top customers held in October, and a $1.5 million option payment for the paired growth program. which we expect to record as IT R&D expense. These planned expenditures are included in our updated full-year non-GAAP operating expense guidance. In the third quarter, our adjusted EBITDA improved by $4.2 million compared to the prior year period, resulting in a positive adjusted EBITDA of $1.2 million. Turning now to the balance sheet. We ended a quarter with $41.7 million in cash and cash equivalents, compared with $45.2 million at the end of the second quarter. We continue to have access to approximately $120 million of additional non-dilutive capacity, providing flexibility to support our pipeline development and strategic priorities. As a reminder on inventory, As noted last quarter, we brought approximately 12 months of Jouveau's safety stock into the U.S. on extended payment terms while awaiting tariff guidance. Following official guidance in September, we did not expect a tariff impact on Jouveau and plan to gradually reduce inventory to normal levels. This increase in inventory and in accounts payable will have no impact from cash flow thanks to the adjusted payment terms. Turning to guidance. Our year-to-date performance reinforces our confidence in the trajectory of the business. We are reaffirming our full-year revenue and margin outlook while updating our non-GAAP operating expense guidance. We continue to expect full-year revenue between $330 million and $337 million. representing 11% to 13% growth over 2025. This annual outlook implies a sequential increase in the fourth quarter, reflecting normal seasonality in planned year-end commercial activity. Keep in mind, we are wrapping on mid-teens growth in the second half versus high single-digit growth in the first half. This comparison is reflected in our outlook. Our full-year adjusted gross profit margin outlook remains unchanged at 67 to 67.5%. We are updating our full-year non-GAAP operating expense guidance range to between $210 million and $213 million from our prior range of $212 million to $216 million. The midpoint is $2.5 million lower. and the revised range represents approximately flat to 2% growth over 2025, all while delivering double-digit top-line growth. We continue to invest in JEVO, the expansion of Evelis and Esteem, and pipeline programs that support our future growth. The revised range incorporates the fourth quarter's sequential step-ups, which I described earlier, demonstrating our ability to improve operating leverage while continuing to invest in the business. We are also reaffirming a low-to-mid single-digit adjusted EBITDA margin for the full year. The modest near-term R&D investment associated with the care option agreement is incorporated within our existing financial outlook. As a reminder, our previously announced partnership with IPSA for Profilo reflect the same disciplined, capital-efficient approach to business development with no upfront or milestone payments. We continue to expect Evelisse and ESTEEM injectable HHLs to contribute 10% to 12% of full-year revenue, reflecting form and smooth in the United States and the ESTEEM collection in Europe. Our outlook assumes no revenue contribution from Emily's sculpt in 2026. Finally, we are reaffirming our 2028 financial objectives. We continue to target annual revenue of $450 million to $500 million and adjusted EBITDA margins of 13% to 15% in 2028. We believe the combination of sustained revenue growth Increasing operating leverage and disciplined capital allocation positioned us to achieve these objectives. As the business grows, the level and timing of investment will reflect our commercial priorities, pipeline development, and regulatory progress. Our long-term objectives provide the framework for balancing our continued investments with improving financial performance. With that, I'll turn the call back to David for closing remarks.

Thank you, Tatjana. As you heard today, Evelus has evolved into a broader global performance beauty company while continuing to execute against our financial commitments. The Evelus we are building has a durable commercial foundation and an increasingly broad set of growth opportunities. GIVO continues to grow above market Avelis is expanding our role within aesthetic practices, and our international business gives us additional opportunities to bring these complementary brands to more customers. Each step builds on the relationships and commercial capabilities we've established, increasing the value of the overall platform as the portfolio expands. Four consecutive quarters of positive adjusted EBITDA provide further tangible evidence that we can expand the business while continually improving our overall financial performance. The next stage builds on that foundation. With the anticipated launch of Sculpt in 2027 and Lips in 2028, we have opportunity to expand the treatment needs we address and drive overall growth over the next several years. Profilo creates a development opportunity in skin quality, while our early-stage hair growth program gives us a disciplined way to evaluate a complementary new category. We now have commercial brands generating growth today, products advancing towards anticipated launches, and longer-term opportunities that can extend our growth horizon. We will continue to measure our progress through commercial performance, financial execution, and meaningful development milestones. Our focus is on closing out a strong 2026 and advancing on our 2028 revenue and adjusted EBITDA margin objectives. What gives us confidence is a combination of execution we've demonstrated and the opportunities we have created. We have strengthened the business, expanded its potential, and established a clear set of commercial and development milestones against which investors can measure our progress. We believe that positions Evelus to deliver sustained growth and create long-term shareholder value. We look forward to engaging with investors over the next several weeks at the Steeple and Jeffries London conferences. Operator, you may now begin the Q&A.

Thank you. At this time, we'll be conducting a question and answer session. If you'd 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'd like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for questions. Our first question comes from Mark Goodman with Lorinc. Your line is now live.

Yeah, hi. Two things. One, can you comment on this FDA untitled letter from the Instagram reel, please? And just second of all, U.S. toxin Gervaux in the United States, did it hit double-digit growth in the quarter? Thanks.

Great. Thanks for the questions, Mark. I'll take both of them. First, let me just start with your question around the FDA letter we received. I do want to clarify it was not a warning letter. As you mentioned, it was an untitled letter, and the comments from the FDA were isolated to a single post. related to GVO. We've since removed that post and we plan to address the FDA's concern. And there's no impact on our ability to continue to promote GVO in the same way we have in the past, so nothing affected from a business standpoint. Moving on to your second question around GVO performance. As you know, we don't report by segment. We report revenue on a global basis. will give you a view on an annual basis on our mix of revenue from U.S. versus international, but we did report double-digit growth for Juveau on a global basis, both in the quarter and year-to-date, and we did make the comment that we believe we're continuing to grow above market in both the U.S. and internationally.

Our next question comes from Annabel Sammy with Stifel. Your line is now live.

Hi. Thanks for taking my questions in good quarter. So thanks for the color on the account growth. I'm curious to know about how much deeper you're able to penetrate the accounts now that you have both Javeau and Avelis. And have you been able to break through that, I guess, I don't know, is the artificial ceiling maybe for Javeau with Avelis on board? And maybe you can talk a little bit more about the – Conversion of trialers of Evelis to adopters and I guess what that sort of conversion rate is, if that's what you want to call it. And then maybe some additional metrics around your bundling program would be great and how that might be affecting more movement into the Evelux loyalty programs. Thanks.

Sure. It's a great question, and I think there's two parts to it. The first is Evelis itself and the adoption of the product, and that is part and parcel to also the adoption of the overall portfolio. And so we're seeing very encouraging signs through mid-year, as you know, in our portfolio growth rebate, which is a six-month program. By mid-year, our fastest-growing accounts were those accounts that participated in that growth rebate. The majority of them were purchasing both GVO as well as Evelis, and that's a really strong early indicator. We're now in the back half of the year in the second part of our portfolio growth rebate, and it's too early to comment because, of course, it's a six-month program and we're only halfway through that period, but we continue to hear very encouraging signs. We were in Santa Barbara just a couple weeks ago for one of our larger customer events and we brought together some of our top customers around the country and shared with them the latest data both on Evelisse as well as some of our thinking going forward on how we'll continue to support the portfolio bundle and overall very encouraging feedback which we believe is a positive read-through to what we'll see play out over the course of this year where we expect Our portfolio growth rebate to have a larger number of participants because we're seeing Evelisse adoption continue to increase in our biggest customers while it's also continuing to bring in new customers into the Evelisse new account phase. At the same time, in the fourth quarter, we introduced a portfolio pilot that's designed to more closely bundle Jouveau and Evelisse and I'll look forward to giving you some feedback coming off of the end of the year results on that new pilot. And as you may recall, we generally do a pilot to inform how we adopt and evolve our portfolio bundle for the following year. We did this last year, we're doing it again this year. And so it'll be an early read into how the portfolio bundle will evolve. And then going back into Evelisse for just a moment, We're really pleased with the progress we're seeing there. Look, the market was somewhere between flat to single-digit growth in the third quarter. Here we are wrapping around just over a year on the market with Evelis, and we have a brand that's growing over 40%. So we're continuing to gain share, and we're seeing that in both adoption within clinics rising as they're gaining confidence with how to use the Smooth & Form product, But we're also seeing some of the sampling initiatives that you referenced in the front half of the year result in more new accounts engaging and purchasing product from us in the third quarter. Now, the third quarter, as you know, it's a seasonally slower period. So on average, accounts purchase less volume in the third quarter. than they do in the other quarters of the year. So what was interesting about the third quarter in particular with Evelis was the number of total accounts we saw purchasing. It was a very encouraging sign that we're seeing broader adoption of the product and we're continuing to see the product integrate further into the practices. And then the last thing I'll leave you with is we did talk a bit in our advisory boards around the Sculpt product. There's a significant amount of interest. in Avalis completing the portfolio with a mid-phase product. And we do know that that's an important part of having a full portfolio of facial injectable fillers. And so we're excited to bring that to the market in the new year to customers. And we think the Avalis line is not only performing well in the market we're in today, but has a lot of potential as we continue to build that confidence with injectors over time.

All right. Thank you.

Our next question comes from Nivon Tai with BNP. Your line is now live.

Hi, good evening. Can you maybe start how are toxins and fitters trending in that seasonally high Q4? and then if you have any initial comments on the toxin and feeders market for 2027 and then if you could also quantify the meaningful share gain in feeders if possible. Thank you.

Sure, Navon. I'll take the question on Q4. So what we've said consistently this year is that when you look at quarterly revenue, it's best to think about the normal seasonal step-ups and step-downs versus looking at year-over-year growth. And that's exactly how we're thinking about Q4. So normally, historically, we'd see a 25% to 30% step-up from Q3, which is seasonally low, to Q4, which is high, as you referenced. And that is effectively what's implied in our guidance. Now, if you think about where toxin and filler are as far as the market, right, we're seeing the filler market quite healthy. We're probably seeing it in the mid-single, high-single-digit growth, and we expect that to continue into 2027. And the filler is flattish, perhaps returning to growth, and I think we expect that to continue as well.

Thank you. And can I ask if you can remind us of the launch activities and the timing before the launch of scopes?

So our assumption is approval in Q4 and launch in Q1 so that you would see those launch activities really happening in the first quarter of 2027. Thank you.

Our next question comes from Douglas Tsai with HC Wainwright. Your line is now live.

Hi, good afternoon. Thanks for the questions. I'm just curious, you know, in terms of the account growth that you've seen, Are you now getting into a different type of account? And do you think that when you do eventually launch Sculpt that you will see sort of another step up or another leg in terms of account growth? Thank you.

Sure. It's a great question around account growth. Let me just start with a view of where we sit today. We're approaching 20,000 total customers that have purchased from Avelis since launch, and we believe that represents somewhere around two-thirds of the total market that's purchasing injectable products in the United States. So we feel that we're continuing to penetrate well through this. Avelis has enabled us to have a more complete offering, and there were a certain target set of accounts that prior to launch We had started to engage with and we're really pleased to see that some of those higher volume, high value customers are working with us. And that is something that's encouraging because they want to have fewer partners and having a portfolio is an important part of initiating those conversations. And beyond that, we do also believe that continuing to add new accounts is a trend you'll see over time. You've watched us over seven years add over 500 accounts each quarter. We think that's the right cadence. As you know, our business model is different. We're a performance beauty company, and when we go into these clinics, we're talking about our product and how to use them, along with how we do business with our clients differently. And that includes the way we partner with them in co-branded media, our tech space consumer loyalty program and the way we do other collaborations and partnerships and that's an important step we believe to establishing a trusted partnership with these customers that becomes the foundation that we build from and that's why when you look at our total account base the reorder rates over 70 percent when you look at our consumer loyalty program roughly 70 percent of consumers returning and seeking repeat treatment We believe those are key foundational elements as we add new accounts to build from to build that terrible business. And, of course, with new products, it allows us to just continue to go deeper within each of those customers.

Okay, great. Thank you very much for the call today.

Our last question comes from Sam Eber with U.S. Bancorp. Your line is now live.

Hi, good afternoon. Thanks for taking the questions here. I wanted to get your thoughts. One of your competitors announced an acquisition of some skincare assets. I'm just curious to get your thoughts on how this may or may not change your ability to compete in the injectables category and if you think you need to respond in some way there.

Yeah, thanks for the question, Sam. First off, I would say that skin care is a great category. It's complementary to injectables. As we look forward, as you know, we're a single product company for six years. and this is our first foray over the last five quarters into a second product in our portfolio and we think that continuing to stay focused on injectables and building out our injectable platform is the right next stage for us to deliver the growth that we've outlined and that's what we'll continue to do and we've done that not just with our commercial products that you see but our entire pipeline is dedicated to these injectable products that go into the same hands inside the clinic that our rep is currently calling on. And we believe that gives us a lot of opportunity to partner with these clinics, both in medical education, the way we advertise, as well as being able to support them in a way that makes it more comprehensive for their patients.

Okay, great. That's it for me. Thanks for taking the question.

We have reached the end of our call. You may now disconnect your lines. We thank you for your participation.