Good afternoon, everyone, and welcome to the webcast of ATEC's Second Quarter 2021 Financial Results. We would like to remind everyone that participants on the call will make forward-looking statements. These statements are based on current expectations and are subject to uncertainties that could cause actual results to differ materially. These uncertainties are detailed in documents filed regularly with the SEC. During this call, you may hear the Company refer to reported amounts, which are in accordance with U.S. GAAP as well as non-GAAP or pro forma measures. Reconciliations of non-GAAP measures to U.S. GAAP can be found in the supplemental financial table included in the press release, which identify and quantify all excluded items and provide management's view of why this information is useful to investors. Leading today's call will be ATEC's Chairman and CEO, Pat Miles; and CFO, Todd Koning. Now, I will turn the call over to Pat Miles.

Thank you much, Pete, and welcome everybody, to the Q2 2021 financial results and update. Clearly, we will be making some forward-looking statements. And just to jump right in, I know where we're positioned. I'd say that we are uniquely positioned for continued industry-leading growth. And I think when you start looking at the tailwinds, you have to think from a PTP perspective, we're -- I'd say we're penetrating the current market, and we're really expanding the MIS market. Now I'll go through further explanation of that later in the prepared remarks, I would say that our U.S. distribution is also improving and expanding. And so that's another tailwind. Love what's going on with regard to EOS from just our ability to have academic influence and so many of the other benefits of the type of information that comes out of a machine. And I think a lot of that is providing a halo effect with regard to more kind of conventional procedures. And so I think we're earning our way in with some of our unique stuff and then getting rewarded additionally by the halo effect of other procedures. And then you'll love the building of a foundation for the international marketplace with EOS. If you look at the scorecard, year-over-year revenue growth of 93%, up 28% sequentially, which is good, 46% 2-year CAGR, which I think is good. It's our eleventh consecutive quarter of double-digit year-over-year revenue growth, another I think, driver is there's real acceptance of our new products. And I think that, that's reflected in the 84% new product revenue, 30% year-over-year growth in revenue per surgeon. I would tell you that's a phenomenon due to PTP clearly, complexity of the type of surgery. So we're earning confidence and then the halo effect of the type…

Well, thank you, Pat, and good afternoon, everyone. It's a pleasure to share the results and our strong quarter review. I'll begin with revenue. Second quarter consolidated revenue was $62.2 million, reflecting 110% growth over the prior year. This includes organic revenue of $56 million, reflecting 93% growth compared to the prior year period and growth of 28% compared to the prior sequential quarter. Impressively, the organic growth demonstrated in Q2 was not simply attributable to an easy pandemic comparison, as our 2-year CAGR accelerated to 46%. Both the strong 2-year CAGR and sequential improvements speak volumes about the powerful momentum our business is driving. The strength of our organic sales results in the second quarter of this year are driven by a significant increase in procedural volume and continued growth in case ASP. With the close of the EOS Imaging transaction, we recognized $6.1 million in EOS related revenue in the second quarter, reflecting sales from the date of the transaction closed on May 13 through June 30. Finally, revenue from our international supply agreement totaled approximately $400,000 in the quarter. So to summarize, the total revenue result of $62 million represents growth of 110% and is comprised of organic revenue of $56 million, the EOS acquisition, which contributed $6.1 million in revenue and $400,000 in revenue from the international supply agreement. Continuing through the remainder of the P&L, the non-GAAP gross margin was 73% in the second quarter, down 430 basis points compared to the prior year. Pressure on gross margins was due primarily to the consolidation of EOS Imaging, which had an unfavorable 390 basis point impact in the period. Historically, EOS's business generates gross margins in the mid-to-high 30s range after we adjust for GAAP to IFRS differences at internal accounting policy alignment. That is compared…

Thanks much, Todd. I think in conclusion, I think the reality is we still have a lot of work to do, but there are some great tailwinds. PTP is the real deal and excited about the years of continuing to advance that procedure. Clearly, our ability to continue to improve our U.S. distribution, make it exclusive and expand it is standing in front of us. I think reflecting EOS is our next foundation and such an opportunity to make for better surgery and further academic investments. And so I think the halo effect of some of these things will be tailwinds, as well as literally just the -- we've been a U.S. company only. And now the opportunity to march in the international space is something that we hold very exciting. So our transformation requires strong execution against our commitments. We remain totally committed to advancing the clinical experience in spine. We feel like when value gets created than dollars chase it. And so we're just getting started and can't be more excited about the route forward. So with that, we will take questions.

[Operator Instructions]. Your first question is from Brooks O'Neil from Lake Street Capital.

Congratulations and all of you have a confidence. One of the things that I'm particularly curious about is I have a sense that with the SafeOp informatics platform, now on the cusp of being integrated with EOS, that there's a significant opportunity for pull-through product sales and product utilization in spine surgery. Can you just talk a little bit about where you're at in terms of integrating or linking those 3 elements, such that you can really begin to drive the product sales going forward over time.

I got to tell you, like it's great fun to be able to pull stuff into the operating limit, ultimately makes for a real effect. And so the ability to drive that information into the operating room. And even into the preoperative planning phase, what we'll do is we will inform the preoperative plan with our products. And you start to think about all of the opportunities to do that, and that will reflect a pull-through that is abundantly clear. And so there are some very tactical ones, I think, are going to happen sooner, and that's going to be and how do we start to place more and more EOS units across the world. And how do we ultimately tie implant utility to the EOC unit. And I think that there's been such a widespread acceptance, I very much like the combination of our currency, which becomes the implants to ultimately serve the interest of better information. And so I think when you start to think about pull-through, I think you initially start to talk about just the effect of a current population of EOS out there that can be upgraded and upgraded through a currency, and then we start to think about the acquisition and more units through our currency. And all of those have an effect on the volume of implants utilized. And then I think really where we want to go is, candidly, the sophistication of a very small interoperative footprint and being able to deliver information that becomes actionable in the operating room. And that's going to take a little work in a longer period of time, but that's where it's all going, and that will completely affect what type of implants are used. One, based upon bone quality and demand matching the type of fixation elements that stabilizes spine. And then secondarily, making sure that cash, things like how do you make sure that the patient is aligned in the way that I prescribed based upon my surgical plan. And so I think those things are the real interest and they're doable things. And the things that we've done before. And so I love where we're going on that standpoint. But I think the earlier phase may be a great one with regard to seeing impacts still reflected through the utility or value of EOS

Second question I had was -- I'm excited about international. Obviously, your international agreement with Globus ends this month, end this month. Can you just talk a little bit about how you foresee expanding and enlarging the ATEC presence and take advantage of international opportunities, let's say, over the next year or so?

Yes. I think -- I'll speak broadly about the international opportunity. And again, it's something that we're very enthusiastic about. We're also very realistic about how we get contribution out of respective areas of the world. And so I think that we will be very well served by being very narrow and very narrow and deep. As you appreciate, I think the clinical distinction that we're driving requires engagement at a deeper level. And so for us to lay a foundation for depth through a narrow focus is what's in our interest. And I think that anybody who's been around the spine space knows the really the great 5 or 6 markets that are very apparent. And so I think that it's going to be a very apparent walk toward markets that have kind of a good paying environment, have a very kind of clinically sophisticated environment. And we're not -- we're going to go into these markets with the best of the best, which is such an advantage. A lot of people dump in markets, and that's not our way. Our opportunity is to go in there and really go with out of the gate, first generation products that are the best and the best.

And Brook, I think as Pat said, kind of this narrow and deep allows us to be fully committed to a geography, and ultimately drive penetration. And then we believe that, that will ultimately throw off returns sooner and give us a better overall margin profile in the long run in our international footprint.

Your next question is from Kyle Rose from Canaccord.

So just really two for me. One, I wondered if you could just talk a little bit more about the case mix you're seeing in the United States. And obviously, with the growth from new products and the average product per case, the whole scorecard is moving in the right direction. But maybe you could give us just a little more color. I mean, I think we've talked in the past, PTP has got a pretty high training burden. It seems like training is happening a lot more now than it was previously. So are you seeing more of those PTP cases come in? Or just when you're bringing on the new reps, are they going towards one side of the product portfolio versus another? And then I'll ask my next one in a minute.

I'll start off and then I'm going to turn it over to Todd, because he's going to be more precise than me and all things. I think the people that come through here are super excited about PTP. But the beauty is that there's an underlying sophistication to what we've done from a product development perspective. It's funny if people come here and they say, gosh, I want to come and learn PTP. And then they'll see things like SingleStep, and they'll see things like SafeOp, and they'll see things like Identity. And the different things that we're doing, we'll say, what -- this is truly next-generation of stuff. And so the great part is I think that people are compelled by the PTP thing. And to your point, is there's a training requirement to there, and there's going to be a long walk on that, and it's going to be a good long walk. But I think that what's earning utility becomes some of the sophistication associated with the type of design prowess that we have from an engineering and marketing perspective and just the whole team, honestly. So anyway.

And overall, Kyle, I mean, when we kind of look at our portfolio, our product portfolio clearly was a strong contributor to our growth, very much in line with our overall growth profile. We saw a strong contribution from our Alpha InformatiX line, as well as Biologics in the quarter, kind of above our corporate growth rates. And then when you kind of look into it, obviously, the PTP driving a lot of the procedural volume, and then that pull through, we're seeing strong contributions from both Invictus and Identity, which you would expect, and I think is reflected in the fact that 84% of our total revenues are from new products. So I think when you kind of dig in that layer or two deeper, it all really hangs together quite nicely.

And then you talked about the strength of the exclusive team. Maybe just any more gaps that you see in the portfolio that you think you will need to address in order to really capture, I guess, the remaining portion that might not be exclusive? And then secondarily, just on EOS. On the exit velocity, I mean I appreciate the guidance for this year, $25 million. Is that the kind of the run rate we should think about moving forward when we think about the second half of this year in the mid teens growth? Just trying to understand longer-term modeling implications of EOS as well, just particularly given you're going to take some of the earn-out opportunities as well.

That was really three questions. Let me answer the one that's got a hole in the portfolio, and I'll let Todd answer the one on EOS and exit velocity. If you look across our portfolio, there are still holes in our portfolio. And I think the ones that are most specific, candidly, you're going to see in the short-term are things like corpectomy devices. And so one of the real great opportunities with PTP is the different types of surgery. So it's candidly simialr to an experience that we're very familiar with that we had previously, which becomes as you teach someone how to ultimately do a procedure and then they walk up the sophistication curve. And so you'll see the applications of say, PTP and things like a single level 4, 5 spinal thesis or a 3, 4 adjacent level. And then you'll see it start to walk up. And so what we're doing is we're running forward to catch the corpectomy because it's ultimately going to get there. And so I would say, when you start to think about holes, currently, an expandable corpectomy device is what I would consider up all. But again, we're running up the sophistication ladder and what we want to do is, beat through corpectomy, and I think we will. The other elements becomes, as we get more sophisticated about the utility of PTP in longer contract surgery, our ability to start to go to the back first and release the facets to make sure that we completely control the angulation of a specific level and then to be able to do that through an expandable device is super exciting. I get a hard time for not loving expandable devices. What I don't like is introducing more variability into an environment that doesn't require it. I would tell you the level of sophistication that we will get to in terms of insulating a segment is very, very high. We'll take the EOS information integrated in and make sure that we were able to ultimately architect an alignment that is completely what we intended. And so things like expandable devices are going to enable us to do that, and things like corpectomy are still what I would consider a hold. But again, we're walking up a sophistication ladder that I think is kind of what we love to do and why we're here. And so I'll let Todd jump out at EOS.

Yes. Kyle, I think when you look at our guidance, it implies $19 million in the second half and kind of mid-teens growth, as I said earlier. And when you look at the revenue, a good chunk of that revenue was maintenance-related recurring revenue which then we add to that placements and the revenue associated with delivering the actual equipment. And so certainly, we've got a strong order book here. Pat talked about our focus on reducing the amount of time from order to delivery. And I don't know how much we talk, but I think there's a tremendous amount of excitement and interest from our existing surgeons. People come in here, they see the EOS machine. And so we got a lot of interest in the technology. And so I think that bodes well for our ability to continue to drive growth and placements as we go into 2022. And ultimately, as Pat said, the reflection of the value of yields won't just be in the EOS revenue line itself, it will also be in our ability to translate that in to implants and the utilization of our products.

Our next question is from Josh Jennings from Cowen.

Congratulation on the first half of the year. Wanted to ask about the surgeon education visits. I'm just looking at the chart you guys provided in the presentation looks at least a doubling in Q2 versus even Q4 of '20 in terms of the number of education visits. I wanted to just understand better the conversion rate of new customers, the percentage of, if you can break it down, get this granular. The percentage of visits from new customers, surgeon customers? And is the growth and resurgent customer adds kind of correlating with these new growth in the education visits? And then within the new customer surgeon customer bucket, are you seeing more better in MIS surgeons coming to get educated? Or are these open surgeon -- historically open surgeons that are migrating to MIS. I just have one follow-up.

Yes, Josh. I think I'll talk a little bit about our conversion and then pass it over to Pat to kind of dive into maybe the -- who's coming through and what kind of folks are participating. But we pay a lot of attention to conversion. We haven't really been public about the conversion rate. But I think what I would say is we're very pleased with the level of conversion, and we do pay attention to it. And certainly, there's an incredible amount of demand for access to the training and our sales organization understands that. And it's a commitment on their part. It's a commitment on the surgeons' part, commitment on our part. And I think what's really need is that when you sit there and oftentimes on a Friday, I'll pop in and kind of listen to some of the wrap-up and you get a chance to talk to different people, what's nice to know is everybody understands the level of commitment that it takes from all parties to make that learning experience happen. And so I think that's why we see the strength of adoption post training that we do. And Pat, maybe you want to talk about kind of who's coming through?

Yes. As I listen to Todd, and I thought about the history over the last few years, mathematically speaking, they have to be new, because there's so many more people coming and they're coming for the reason to learn something new. And so it's a demographic element, but I think that we're most excited about. The fascination for us is where these lateral guys that are coming to in essence, refine a new skill set in the same type of an approach from a prone position or is it guys who are more conventionally minded who have done more posterior approach. And candidly, it's been both. I would tell you that probably the familiarity with the person who is laterally trained has been likely the guys who are most early interested, because I think they understand the effect of being able to address the back of the spine, the front of the spine and back to the back of the spine. It's been fun also to see a lot of conventional guys, guys who would be open TLIF or open PLIF come through here and really be, say, I have been waiting to do lateral surgery until there is a solution that may be will need to decompress directly the back of the spine. And so it's been kind of a fun thing to see. But I would tell you that we're still in such kind of a bit of the early adopter phase. There's a lot of new surgeons to ATEC, which is, I think, the most exciting part of it because I think that we blow them away with regard to our new facility. Our facility is state-of-the-art, and it was designed specifically for this very utility. And so the opportunity to create confidence in a group of people that ultimately come here to learn something and walk away with a renewed view of our company is just such a great opportunity. And so independent of providing specific rates of closure with regard to those, they walk away with great enthusiasm.

And just a question on EOS. And just I know it's a short time since you closed the deal, but just any updated thoughts on cross-selling opportunities of ATEC implants and instruments into the EOS customer base and the other way around EOS systems into your ATEC customer base would be helpful just to understand.

Yes. Josh, I appreciate the questions very much. And I can't tell you, like we've had several prominent EOS surgeons here. And the type of language that they use in terms of the importance of this acquisition can't be understated. And I think that our interest in terms of selling through that is clearly high. But I think, what's more important is to further the field fund we experience, and that's going to really drive real value. If you start to look at like -- so you look at, say, a large multi-special orthopedic group, and you say, gosh, how is EOS relevant to them? And there's been papers published that talk about an 8% to 10% dislocation rate in total hip surgery when someone fixes a construct to the pelvis in a total hip patient. And there's very clear reasons why that happens and it helps people retrofit or publish when they sit. But the beauty of our mitigating some of that, I think, is, one, the proper things for a company like us to do. But two, there's great financial value in knowing that information and being able to do something about it. And so as I look at the landscape, I start to say, Gosh, what's still reflective. It's not that we're going to sell a few more pedicle screws based upon some alignment thesis, but it's more a matter of understanding the richness of the information coming from that unit and translating into a better care profile.

Your next question is from Matthew O'Brien from Piper Sandler.

Pat, can you talk a little bit about the U.S. distribution group that you have, where that needs to go in terms of getting them more exclusive, the opportunities that are there? And then you mentioned that 1/3 of the group that's still kind of underrepresented at the moment. If I do the math, it seems like the 2/3 that are doing well are about 5% market share in the U.S. because overall, you're about 4%. So I'm just wondering if you have a couple of geographies that are in the upper single digits. And then when can you get the whole group up to that 5% level, and then think it even beyond that, does it take a couple of years to get the whole group to 6% or 7% of the U.S. market? Or can you do it or you will be taking longer than that?

So the beauty of the question is, is one who doesn't do that math well and so you're going to angulate me into a converting. And so let me just speak generally, and Todd will give you the math, the beauty of him here. I look at the places where we have very effectual salespeople that literally -- and I'm still going to surgery, and I was in surgery recently, and I watch these guys make surgery better. And so I love the company to talk about replace models and everything else. I hope they further that deal, because we're not and so where we have effectual salespeople we prosper. And there's multiple marketplaces around the country that we have very affectionate guys, who are exclusive to us that are doing the very thing that you're describing, which is marching up the market share ladder. And candidly, they are bigger and bigger pockets as we will for. They're about 2/3 of our -- as a population just because some of the larger cities are places that we haven't had much effect. But if I look at New York City, candidly, Chicago and Los Angeles, but we're big players. I think we're well below the numbers that you're counting. But actually, you look at other geographies, and we're making significant hay. So it's kind of one of those things where it's like we're taking in some markets, we're taking a C player to B. In other markets, we have D players, we're moving to A. And Todd, why don't you provide a little...

Yes, we did have the national sales maybe a couple of weeks ago, and it was really my first opportunity to meet a lot of the sales force. And then I'd say the quality of the individuals that show up and not just to the meeting, but to show up every day, the surgery is great and really encouraging to me, and I just want to give a shout out to the team, because I think they're fantastic. And once we do get I think full coverage, we've got really sky the limit based on what I've seen. But to kind of get to your question, I think what we've seen is we've seen and ultimately, our guidance here implies 50% year-over-year growth. And ultimately, I think Pat did a great job of laying out the drivers we have in front of us, PTP penetration, ability to expand that MIS market into TLIF and PLIF, reflecting the power of EOS, the halo effect of all of that. And I think all of that should continue to help us drive strong growth north of 20% into the next number of years. And so ultimately, how that gets reflected in market share will depend on our performance and our ability to deliver. But I think we've got all of the makings of a strong run here in front of us.

But switching over to just a couple of things maybe for you, Todd. Just did I hear the instrument set deployment number right? Did you say $37 million this year? And then just on top of that, it may be helpful for investors, given where the cash level went from with the EOS acquisition and then some of the onetime transaction costs, just to give us a sense for the cash burn back half of this year and then into '22.

Yes. So our total operating cash was $37 million, Matt. Of that $37 million, $24 million was deployed in instruments and inventory. And so I think that's ultimately there to drive the level of growth and to support the growth that we foresee in the future. Again, if you kind of walk back our cash position, we landed at $77 million. We were at $191 million, going from $191 million to 77 and $73 million of that was used on the EOS transaction. That's about $90 million of cash out in both shares purchased on EOS as well as OCEANE's acquired. And then we added about $17 million of cash in the transaction. And so that's how you get $73 million in terms of a net use of cash associated with yields in the quarter. Then you take the $37 million, and of that $37 million, $24 million is for instruments and inventory, as I said, supporting our sales growth. And then the balance of the operating cash is at about $13 million from there. We had about $5 million of contribution from EOS, of which a good chunk of that was some transaction expenses, and we had some transaction expenses in our operating as well. And so as you kind of think about the cash use in the second half, we've certainly made additional investments in instruments, in inventory, and we're going to continue to do that to drive the support or drive the growth and to support the growth that we're seeing, and we continue to expect. So our estimate is somewhere in the $45 million to million $50 million of cash used in the second half of the year is our expectation. And then just to, I guess, make the point, with $77 million on hand, we've got excess to another $40 million with Squadron. And so that would give us about $117 million of cash, which I think is planning our way into the future.

Your next question is from Jason Wittes from Northland.

Couple of follow-ups. First of you mentioned international expansion. Do we see it for this year or is that something more for next year in terms of when we can see that starting to contributing to the top line?

Yes. That's a good question. I would tell you that we're in the foundation lane phase and not ready to give specific timing with regard to our participation in the space.

Okay. That's fair. And then related to EOS, it looks like this year, you're kind of tracking for the second half. I think you mentioned mid-teens growth year-over-year. Does that include any kind of assumptions on pull-through or synergies? Or how should we think about that number? And also going forward, and maybe this is asked, is that the right kind of growth rate to expect for EOS? I want to know how we should be thinking about this part of the business?

Yes, Jason. So in the second half, our EOS guidance is implied at $19 million, which is mid-teens growth. And that reflects really kind of core EOS revenue. So kind of think about the maintenance revenue, as well as the revenue that we gain when we sell a unit and deliver it and transfer the title. And so that is really very EO specific. As I mentioned earlier, the ultimate economic reflection of the EOS transaction is going to come both in the form of EOS related revenue as well as the pull-through of our products and services kind of on the core ATEC side of the business. And so ultimately, that will be the reflection of the value of the transaction, and it will come both in our hardware products and services as well as EOS placements. In terms of how to think about the EOS revenue in 2022 and beyond, the second half really reflects the order book that we've seen. And so ultimately, that order book is there. We're working to do those placements and deliver on our commitments. And our ability to drive growth there is, of course, dependent to our ability to drive interest in yields. And I'll tell you, I like our chances there. I think we've got great interest from the ATEC friends and family, and I'm quite excited about what the future holds as it relates to the EOS business, both kind of core EOS revenue, as well as the broader reflection of the transaction as it relates to implants.

Maybe push a little bit harder, though. In terms of how you're selling EOS right now, is it still going to be traditional capital equipment sale with service? Or are you starting to bundle in with or offer some kind of bundling or something to take advantage of the Alphatec platform?

Jason, let me jump in. So I would say really there's 3 ways we're going to sell EOS. We are going to sell outright capital, we're going to lease it, and there's going to be an earned purchase type of an agreement. And so the things that I think created a headwind for EOS without ATEC is the inability to have a currency by which people can appreciate all the value of that technology without multiple ways to ultimately offset the financial requirements. And so I think what we're seeing is a lot of enthusiasm to say, hey, listen, how do I partner with you guys? There's already an interest based upon all 10 that they're learning about ATEC, and then it's like, gosh, how do we elevate that with regard to in EOS. And so I think our building infrastructure to support that demand is of high interest to us.

Okay. And then just last question on Alpha InformatiX. Now that you've added EOS, it's a pretty impressive offering. How do you think about this developing? I mean, obviously, there's more to go on EOS. Are there other pieces that you think you need to add to this platform, so they get even more compelling?

Yes. I think it's a great question. I think one of the great things that I think that this company does is we apply our learnings. And you couldn't have convinced me that I would be in the patient positioning business years ago. And so I think whatever the requirement is to further the improvement in surgery is the business that we will be in. And so it's a tough one because the one problem I'm super excited about is so there's great internal confidence in terms of creating -- realigning the spine and doing patient-specific stuff, I think another great outlier because the whole bone quality dynamics and just the opportunity to elevate the sophistication and demand to match an implant based upon the specific requirement of a patient's bone. And so I think we have a great runway in terms of deciphering all of those things. And so in the near -- I guess in the near view, those are the things that I think that are a super opportunity. Like imagine going in the operating room and having an objective measure associated with how you're trying to realize a patient versus someone just guessing maybe too strong, but we relying upon gesture and Alpha does an objective measure. And that's where we're heading. And I think that's a great opportunity in the most immediate term.

Your last question is from Sean Lee of H.C. Wainwright.

So I just have a couple of higher level questions for you. So in terms of EOS, because we know that it has a different sales cycle and even more somewhat certain customer base than your traditional offering. So I was wondering whether you keep the sales team separate, but are operating on a one big team and then you try to integrate everyone and then have all the reps cross-selling both products on both sides.

Yes. I think it's a good question. And I think that in EOS's case, I think the EOS was an imaging company, we sell imaging to a radiologist. And but what you need is you need someone who's going to utilize the type of image, and that's going to be most often in a spine surgeon or an orthopedic surgeon. And so I think what's important is that what we do is we overlap the selling forces. And if the main driver is going to be the spine surgeon that's going to drive the demand for the imaging. I think that it's important that that's the person that ultimately drives the acquisition of the capital. And so we've already reconfigured our forces to overlie them. They all report up through a single channel, and we believe that EOS is an informatic company. And so our ability to knock down the barriers associated with the financial headwinds to acquire a unit is what we believe to be most important. But I think that your comment is a sound one in that there's going to be some interaction with radiology, but it's something that the capital for us is well used to doing and very verse in terms of those kind of selling cycles and selling dynamics.

And Sean, I think when you look at the 2 sales, it's really 1 sales force, but we've added some resources specific to the capital sales process. And so ultimately, we're making sure that very much aligned with the objectives of our Spine, a shared company of our spine team. But the reality is it takes a very specific kind of know-how and understanding in specific institutions, on how to move a piece of capital equipment through the process and to get the deal done. And that's really what this team is all about, because they have that expertise. They know how to do it. They're going to work very closely with the implant team as we look at leads and understanding who we're going to target and how we're going to go forward here. But there's definitely a different skill set, and we want our implant team focused on implants.

My second question is on the -- how you will develop yields going forward. So looking back at the success of SafeOp, a lot of success comes from how SafeOp is driving the portal sales of your other products. So I was wondering whether you try to recuperate that with yields and whether in the future you develop spine related products that work specifically with yields?

Yes. I think you're right on it with regard to the intention. And so there's little love. We try to not be coy and say ATEC informed by EOS and really be informed to by means what are things that we can do to improve spine care through the understanding of our learnings of EOS. And I think in the near-term, what you're going to see is you're going to see a surgical planning platform that ultimately is informed with the ATEC product. And then what you're going to see is you're going to see the evolution of ATEC product being evolved based upon the findings of the types of information that EOS provides. And that's where like, it's like, for instance, if you think of OsseoScrew, we have a screw that expands. And you start to think about, hey, someone may not have great bone quality at a specific level. Our ability to take an OsseoScrew and apply it to that level based about a surgical plan is very apparent. And so that would be kind of the least sophisticated thing one could expect from the type of information through EOS. And so the excitement that we have in terms of really tailoring people's surgery, and people always talk about patient-specific stuff. I got to tell you that there's a real walk toward a much more patient specificity associated with the findings through this tool.

I will turn the call over to our ATEC's Chairman and CEO, Pat Miles.

Thanks very much. And I just wanted to thank everybody for their interest in ATEC. We have a heck of a long run in front of us and super excited about moving the field of spine surgery forward. And I just appreciate everybody's interest in what we're done. Thanks very much.

This concludes today's conference call. Thank you for participating. You may now disconnect.