SmileDirectClub Results Presentation Deck
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Gross margin.
Gross margin for the quarter was 70%, a 16%
increase sequentially
As noted in Q2, the issues experienced were
transitory, and we have seen gross margin
return to Q1 levels
We continue to focus on streamlining our
manufacturing
smile
DIRECT
Still weighing a little bit on gross margins,
initial aligners were 65% of aligners shipped
in Q3, compared to 61% in Q2 and an average
of 77% from 3Q19 to 1Q20
This is because there is a lag from initial
shipment to Touch-up aligners, and we
had higher volume in January and
February
This will correct to historical levels as
volume grows
CLUB
Our long-term gross margin target of 85% of
revenue remains intact
Our second generation of automated
manufacturing ("Gen 2") is now live, and we
are producing approximately 10% of our
aligners on Gen 2. We expect this percentage
to increase meaningfully by year end
73%
82%
Gross margin %
77%
73%
1.
54%
70%
Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020
Q2 2020
70%
Q3 2020
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