STAAR Surgical Reports 55% Decline in Net Sales Amid Restructuring Efforts

STAAR Surgical Company reported significant financial challenges in its latest quarterly filing, with net sales for the three months ended June 27, 2025, totaling $44.3 million, a decrease of 55% compared to $99.0 million for the same period in 2024. The decline was primarily attributed to reduced sales in China, where distributor purchases fell sharply as they relied on existing inventory to meet demand. The company’s gross profit also suffered, dropping to $32.8 million from $78.4 million year-over-year, resulting in a gross margin of 74%, down from 79.2%. For the six-month period, net sales decreased by 50.7% to $86.9 million, with similar trends observed in gross profit.

In response to these financial pressures, STAAR Surgical undertook a restructuring initiative that included leadership changes and cost-cutting measures. The company recognized restructuring and impairment charges totaling $27.9 million for the first half of 2025, which included severance costs and asset impairments. General and administrative expenses decreased by 11.3% to $21.0 million for the quarter, while selling and marketing expenses also fell by 15.2% to $26.3 million, reflecting the company's efforts to streamline operations.

Operationally, STAAR Surgical's inventory management has been a focal point, with total inventories increasing to $53.1 million from $43.3 million as of December 27, 2024. The company has also implemented consignment agreements with distributors in China to mitigate risks associated with tariffs and to better align inventory levels with actual demand. This strategic shift aims to stabilize sales in the region, which is expected to normalize in the latter half of 2025.

The company’s cash position improved, with cash and cash equivalents rising to $167.1 million from $144.2 million at the end of 2024. However, total current assets decreased significantly, reflecting the challenges in sales and inventory management. STAAR Surgical's outlook remains cautious, with management indicating that future performance will depend on the recovery of sales in China and the successful execution of its restructuring efforts. The company is also preparing for a proposed merger with Alcon, which could further impact its strategic direction and financial stability.