Good day, everyone, and welcome to Sight Sciences Fourth Quarter 2025 Earnings Results. [Operator Instructions] Please note, this conference is being recorded. Now it's my pleasure to turn the call over to Trip Taylor with Investor Relations. Please proceed.

Thank you for participating in today's call. Presenting today are Sight Sciences Co-Founder and Chief Executive Officer, Paul Badawi; and Chief Financial Officer, Jim Rodberg. Also in attendance is Sight Sciences' Chief Operating Officer, Ali Bauerlein. Earlier today, Sight Sciences released its financial results for the fourth quarter ended December 31, 2025, and initiated its revenue guidance and adjusted operating expense guidance for full year 2026. A copy of the press release is available on our website at investors.sightsciences.com. I would like to remind everyone that comments made by management today and answers to questions will include forward-looking statements, including statements about material business considerations, 2026 outlook and financial guidance. These statements are based on plans and expectations as of today, which may change over time. In addition, actual results could differ materially from projected results due to a number of risks and uncertainties. For a discussion of factors that may affect the company's future financial results and business, please refer to the earnings release issued prior to this call and the company's most recent SEC filings. We undertake no obligation to publicly update or revise any forward-looking statements, except as required by law. Also on this call, management refers to certain financial measures that were not prepared in accordance with generally accepted accounting principles in the United States, including adjusted operating expenses. We believe that these non-GAAP financial measures are important indicators of the company's operating performance because they exclude items that are unrelated to and may not be indicative of its core operating results. See our earnings release for a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures as well as additional information about our reliance on non-GAAP financial measures. I will now turn the call over to Paul.

Thanks, Trip. We ended 2025 with solid execution across our business, highlighted by fourth quarter revenue growth in both segments, strong gross margins and continued operating expense discipline and cash management. In 2026, we're building on this momentum with a clear strategy to return to double-digit growth while maintaining our operational rigor and financial discipline. Before reviewing the quarter, I want to frame our discussion around the size and significance of the markets we serve and why we're confident in our long-term opportunity. Our flagship interventional technologies, OMNI and TearCare, address 2 of the most prevalent anterior segment diseases, glaucoma and dry eye disease. Glaucoma remains the leading cause of irreversible blindness globally and dry eye disease continues to be one of the most common reasons patients seek care from eye care providers. With proprietary minimally invasive technologies designed to comprehensively address the root underlying causes of disease, we are expanding both the role of interventional solutions in the markets we serve and the markets themselves. Together, these 2 increasingly interventional categories offer substantial runway for continued growth in the years ahead. Consistent with that strategy, we've updated the way we describe our businesses. What we previously referred to as surgical glaucoma and dry eye, we now call Interventional Glaucoma and Interventional Dry Eye, reflecting our focus on elevating the standards of care with earlier procedure-based interventions. We believe this interventional focus positions us to participate in an important part of the treatment continuum and over time, creates multiple durable growth drivers across both glaucoma and dry eye. We believe there is significant customer and patient overlap in these 2 categories that can unlock synergistic commercial value. Many patients who suffer from glaucoma also suffer from dry eye disease and meibomian gland dysfunction, which can be exacerbated by continued use…

Thanks, Paul. Before I turn to the results, I want to emphasize that we're entering 2026 and from a position of strength. With the operating discipline and cost structure we need to support growth, and over time, we believe this positions us to achieve cash flow breakeven without the need to raise additional equity capital. Unless otherwise noted, my comments reflect results for the fourth quarter of 2025 and comparisons are to the same period in the prior year. In the fourth quarter, total revenue was $20.4 million, a 7% increase. Interventional Glaucoma revenue was $19.7 million, an increase of 5%, driven by increases in ordering accounts and average selling prices. Interventional Dry Eye revenue was $0.7 million up from $0.3 million, reflecting positive traction in our reimbursed Interventional Dry Eye business model. Gross margin was 87%, consistent with the prior year. Interventional Glaucoma gross margin remained strong at 88% compared to 87% with the increase primarily due to higher average selling prices and product mix, slightly offset by tariff costs. Interventional Dry Eye gross margin improved to 68% compared to 51%, primarily due to higher average selling prices. Total operating expenses were $21.5 million, a decrease of 25% compared to $28.5 million primarily due to lower personnel-related expenses and stock-based compensation. As a reminder, we conducted a reduction in force in August 2025 and the fourth quarter was the first full quarter of our lower cost structure. Adjusted operating expenses were $18.9 million, a decrease of 23% compared to $24.4 million. Net loss was $4.2 million or $0.08 per share compared to a net loss of $11.8 million or $0.23 per share. We ended the quarter with $92 million of cash and cash equivalents compared to $120.4 million at the end of 2024. Cash usage was $0.4 million in…

[Operator Instructions] Our first question comes from the line of Frank Takkinen with Lake Street Capital Markets.

Great. Congrats on a strong finish to the year. I was hoping to start with one on guidance. Just curious if you could provide some color on kind of low-end versus high-end assumptions and it'd be helpful to talk about Interventional Glaucoma and Interventional Dry Eye disease separately.

Yes. Thanks, Frank. I can take that one. On Interventional Glaucoma, we're in a much more stable market and reimbursement environment than we saw a year ago. And we've got a couple of areas that we talked about in the prepared remarks, where we're focused on there, expanding the combo cataract segment as well as taking share there and expanding the stand-alone market opportunity. So on the guidance there in a much more stable market and stable environment. It's an area where we've been a leader in implant-free MIGS and we've got a team that's had a proven track record of execution. And in a one MIGS world, OMNI performs quite well. So we feel good about getting back to growth here in 2026. On IDE, baked into that guidance, we're early. Q4 was a really critical milestone for us with the MAC fee schedules established. And you saw $0.7 million of revenue in the fourth quarter. As we look ahead to 2026, our initial guidance here we want to step prudent guidance. And then really within that, we haven't assumed additional market access wins within our guidance, but the team is certainly heavily focused on market access initiatives and moving that forward here in 2026. So overall, I think we're excited about getting back to growth with both of our segments here getting to growth in 2026 and looking forward to executing here in 2026.

Perfect. And then a follow-up on kind of both of those factors. What are you assuming for underlying market growth in Interventional Glaucoma? And then saw the ASP a little bit over 1,000 for dry eye. Does that feel like a sustainable ASP rate? Or is that maybe a little bit high for how we should be thinking about it?

Yes. On the glaucoma market, Frank, we think it's in the low to mid-single-digit market growth there. And then Ali?

Yes. Happy to take the ASP question. So remember, when you look at the IDE revenue, that includes a mix of Smart Lids sold as well as Smart Hub sold. So that the ASP would be reflective of that mix within those segments. And we don't provide specific ASP information of our products but that is certainly a factor that you should think about when you're building out your IDE model and considering the different components of revenue.

Our next question is from Danielle Antalffy with UBS.

Sorry for my voice. I'm a little sick. Just a question on the standalone glaucoma market. I'm just curious what you see or how you see this evolving in the near term. I was at AO back in October, it seems to be very much a focus. And I'm a big believer in the standalone glaucoma market. But from a percentage penetration perspective, like how quickly can this ramp? And the second part of the question, what are the obstacles to getting there? And what are you guys doing to help break down some of those obstacles?

Danielle, this is Paul. Happy to take that one. Yes, it's an exciting time in Interventional Glaucoma for the past several years, Sight Science, as well as a handful of other industry players, have been spending a lot of time working with our eye care provider partners in educating the field on the benefits of earlier intervention with minimally invasive procedural-based solutions for glaucoma. I think we're moving, we're excited to be making some targeted investments in activating the stand-alone market so moving beyond an interventional mindset, moving beyond education. I think most glaucoma surgeons today do genuinely believe that intervening earlier with proven procedural interventions, whether that's pharmaceutical or medical device, pure procedure is better for patients over the long term. And now the goal is how to activate, how to turn that understanding of interventions being better earlier into actual cases. And we spent the last year at Sight Sciences really trying to understand how to activate the stand-alone opportunity. I talked about it a bit in the prepared remarks. We're modeling our stand-alone activation after something that's so well understood in ophthalmology, that's cataract surgery. Cataract surgery is a wonderful procedure. It's the #1 procedure by volume in all of medicine. And there's a well understood patient workflow for cataract surgery. So a patient understands that they need to get cataract surgery, what happens next, they come back to their eye care provider for a dedicated visit to really understand what are the available cataract options. And then from there, they get a surgery schedule. And we're finding in 2025 when we do that with a handful of accounts when we bring, when we work with our providers to help them follow this workflow where they bring back an Interventional Glaucoma patient candidate for an Interventional Glaucoma…

Our next question comes from the line of Steve Lichtman with William Blair.

Apologies for any background noise, I'm in the car. Congrats on the progress. I wanted to ask first actually on the operating expenses. 4Q performance and the 2026 outlook were both better than our thinking. So as you think about this year, how are you balancing the opportunity you see on both sides of your business, but in particular, on dry eye with keeping the level of spend in check. Are you focusing really on the 2 MAC areas for now in dry eye? Any color there would be helpful.

Yes. Thanks, Steve. It's Jim. So as we look at investments in 2026, yes, the bulk of them are on commercial infrastructure, and you nailed it on our Interventional Dry Eye we're going to be placing investments in that space and both on the market access side and driving market access progress and then also on the commercial infrastructure side. So if and when we get additional market access wins, we're ready on the commercial side to drive traction. Our thinking is we want to have a mind -- we have an eye on breakeven and financial discipline, like we've done over the past couple of years, we've proven we can really manage OpEx and manage spend. And now we're in a position with a strong balance sheet to go fuel that growth. And we're going to invest -- we're going to learn a lot and invest and potentially pivot quickly, but invest where it makes sense to go fuel that growth. in both dry eye as well as on the Interventional Glaucoma, particularly the stand-alone opportunity.

Yes. Just to add to that, I mean we see the Interventional Dry Eye opportunity as such a compelling large market opportunity and the early traction that we're seeing with accounts has validated that with us. So the investments that we already have in commercial infrastructure appear to be seeing good returns on those investments. and we do expect to grow that team as we move forward, both in the areas where we already have fee schedules established and then also over time as we have additional reimbursement wins. So we are very excited about that, and that was something that we wanted to make sure we accounted for when putting out our operating expenses guidance.

Great. And then just double-clicking on that. In terms of the dry eye revenue for this year, it sounds like you're really laying out guidance essentially in those 2 MACs predominantly. And can you remind us, obviously, you're looking to get more wins, but just in those 2 MACs alone, what you see the revenue opportunity is for dry eye?

Yes, sure. So it's still an incredible opportunity just with those 2 MACs. They have 10.4 million covered lives our estimate because there is a higher prevalence of dry eye disease in a Medicare age population that there's about 700,000 patients in those markets with moderate to severe MGE. So still a very large market opportunity when you think about in Q4, we sold 700-ish smart lids, we're still at 0.1% of the market. So very early in terms of adoption curve here. And when we think about guidance, even the revenue opportunity in those areas is quite significant. Our bigger constraint is our own commercial infrastructure and resources to go activate those accounts and work with customers to set up their Interventional Dry Eye practices. So we do have a small team that is growing, but we also wanted to be careful to that prudent guidance, even taking into account the 2 states. So we won't be providing today kind of what's the full revenue opportunity of those markets, but it is quite compelling, and we think we've put guidance in a very prudent and reasonable place to start the year. And as we learn more and as we expand the team, we will provide updates as we go.

Our next question is from Tom Stephan with Stifel.

Great. First one on TearCare. I know it's early and this may be a difficult question. But as coverage and reimbursement starts to take hold, can you talk to us a bit about sort of how you think about the peak sales potential of TearCare, the inputs, the framework, et cetera, and as a figure, I'll take a stab here, is the figure of at least $100 million a reasonable starting point as we think about TearCare peak sales? And then I have a follow-up.

Yes. Thanks, Tom. I'll take that. So first of all, obviously, dry eye disease is a prevalent problem here in the United States. And if you look at the people who have moderate to severe MGD, there are 7 million to 8 million people who suffer from dry eye disease. Obviously, TearCare Care is a procedure that has been proven through the Hera data to show real benefits to signs and symptoms of those patients with dry eye disease. And so we think it's a compelling opportunity for patients who need procedural intervention and want procedural intervention versus regular daily or multiple times a day drop. And so in terms of the opportunity from a market potential, it's obviously very large. What is critical in that is our ability to gain market access to patients being able to get interventional procedures using their insurance benefits. And obviously, we are still very early in the curve of adoption there with $10.4 million covered lives, and we do look to expand that over time to be able to really make procedural intervention a standard of care. In terms of your question of peak sales, we see this as a very large market opportunity. We aren't going to quantify that today. But you can very quickly do some math that shows this is an incredible opportunity for us from a revenue perspective. But more importantly, this is also an opportunity that is better for patients in terms of having a procedural intervention versus regular eye drops with proven clinical results. It's also better for the eye care providers because the eye care providers get to participate in the economics since they are doing a procedural intervention versus drops where there's no incremental reimbursement for them. And we've also proven that it's better for the payers with our budget impact and cost utility analysis that shows that this is a better economic outcome for the payers as well. So we really think that this is a win for all we're very, very early in terms of market adoption and penetration. So we aren't going to get out ahead of that today. But to us, this is one of the most compelling opportunities in eye care today.

And Tom, I would just add to that. Obviously, we've spent a lot of time together in the MIGS category where you've got several thousand MIGS trained surgeons, several thousand surgeons who are trained on OMNI, in particular, when you think about procedural dry eye opportunity, not only are there more patients suffering from dry eye disease but there's also many more eye care providers and customers that will be our customers for TearCare across the country. That includes, obviously, in surgery, it's just ophthalmology. In Interventional Dry Eye, we have both the ophthalmic customers as well as the optometric customers. So there's thousands of ophthalmologists who can be customers for TearCare and there's many, many more optometrists who can be and will be customers for TearCare. So that's another way to think about the TAM. We'll obviously prove it as we go. We're excited to prove it commercially and generate the traction and deliver the results quarter after quarter. But I think you're going to see a different kind of business model, one, because there's so many more patients. Two, there are so many more eye care providers. And lastly, the model the model becomes more interesting over time because unlike surgery and unlike MIGS, where the goal is a single treatment and hopefully, that treatment keeps pressure under control. for as many years as humanly possible. We know that's not the case with dry eye treatments drop or procedure and in this model patients should stay in the model, getting 1 to 2 treatments per year. So we think that the TAM is super interesting for all of those reasons.

Got it. Really appreciate the color. And then maybe to pivot to glaucoma, and just on the first quarter outlook, up low single digit year-over-year. I would presume maybe is a bit below market and it's against an easy comp. So can you talk a bit about just what you're seeing in the first quarter that supports that near-term view, anything we should be cognizant of from maybe a headwind standpoint that's driving that outlook?

Tom, it's Jim. I'll take that one. I would say the only thing to really call out that's impacted us here in the first quarter as well as many others are the storms across the U.S. in January and February. So that's one piece. Otherwise, we don't see any other meaningful things to call out here in the first quarter.

Our next question comes from Adam Maeder with Piper Sandler.

Two for me, one on dry eye and one on international glaucoma. On dry eye, I was hoping just to get some additional color around your conversations that you're having with the other MACs as well as commercial payers. Just trying to get a sense for when we could start to see some of those other payer domino's fall and would love just to better understand what exactly is -- are they pushing back on anything? Maybe it's just a matter of time and bureaucracy, but you have 24-month randomized controlled trial data. So what do we kind of need to get those additional payers over the goal line? And then I had an additional question.

Yes, I'll take that one. And we've continued to be very active engaging with the other MACs having great conversations discussing their own review processes of the clinical and economic data as well as establishing pricing. And I will say that those conversations are continuing to progress. We do expect to have more MACs join and have more MACs established fee seals, and we would expect that to happen this year. So that's kind of our expectation. More granularity, it's always hard to predict exact timing with MACs. But I will say that, as you pointed out, there is very strong clinical evidence and economic data and we are showing demand and interest from constituents in their market. They are ECPs and patients are wanting access to this technology. And because we do have fee schedules already established in First Coast and Novitas, that is creating tightened pressure on other MACs to also allow access to their Medicare beneficiaries to have a fee schedule established. So we are happy with the progress there. Again, we won't speculate on exact exactly who will be the next one to establish a fee schedule or when that will be. But I will say that those conversations have continued to move forward, and that's really what we expected at this point.

Okay. Fantastic. And for the follow-up, I actually wanted to ask a reimbursement question on the glaucoma side. And I saw recently that AMA elected to move forward with the new goniotomy codes with an effective date of January 2028. So I guess what is Sight's expectation for kind of where reimbursement ultimately shakes out with those new codes. Can you level set us on the percentage of revenue tied to goniotomy for your business? And how are you thinking about any potential impact either positive or negative?

Adam, yes, we are aware of the potential read rock of goniotomy. We believe it's going to be -- the code will be split into an adult goniotomy code and a pediatric goniotomy code. Pediatric goniotomy, as you might expect, is more intensive procedurally and has more follow-up requirements. And so we would expect that the pediatric goniotomy economics might be maintained, but the adult goniotomy when it's revalued everyone, all experts in this area are saying they would expect it to be unfortunately reduced. If and when that happens, it would be in effect January 2028. A fee reduction would obviously put pressure on the utilization of that procedure. OMNI, our flagship Interventional Glaucoma technology, it performs canaloplasty followed by trabeculotomy, or AKA goniotomy. It's built either 2 canaloplasty or 2 goniotomy. We would expect if there's pressure on goniotomy alone as a procedure from an OMNI perspective as the leader in implant-free Mig, and the leader in ab interno canaloplasty that, that could actually be a tailwind at that time. Obviously, we believe, hopefully, the valuation of goniotomy is fair and reasonable. It's an important procedure in glaucoma. We hope that the assessment is acceptable to all stakeholders, mainly eye care providers.

Our next question comes from the line of David Saxon with Needham & Company.

Two for me, one on both of the businesses. First, just on Interventional Dry Eye I think you talked about in the script, you're selling to some omni customers. And I think in the past, you've talked about something like 200 OMNI accounts in those 2 MAC regions. So just wanted to get an understanding, like is the selling approach to ophthalmologists, any different than what you would do with optometrists either in terms of the length of the sales cycle or clinical education or any other dynamics like that?

Yes, I'll take that. So first of all, I'd say we're still very much in early days with this. So the accounts that we're engaging with now truly are the early visionaries. They're the ones that are seeing procedural dry eye as real opportunity for them, an important part of their procedure practices and are looking to be leaders in this area. And so I do think that, that profile of account is already different than what we'll see kind of at scale, especially with coverage density. Obviously, right now, it's a very targeted density associated with those accounts that have traditional fee-for-service Medicare beneficiaries. And so that also influences the accounts that are primary targets right now. So right now, we are seeing a lot of synergies with ophthalmology practices that are existing Interventional Glaucoma accounts because they do have a high mix of Medicare beneficiaries already, and they have a lot of experience with parts with Sights Sciences. That said, when we look at kind of our revenue mix, we are continuing to see new -- both a mix of new accounts and existing accounts order. So both accounts that already believed in the benefits of procedural dry eye and had adopted the product without reimbursement and then those that are now coming on board. So I think it's too early for us to call out specific trends or dynamics here just because it is a unique market environment, but we are very encouraged that our OMNI customers also have a serious problem with dry eye within their patient population, and they're looking for options to treat those. So that has been a great synergy for us and one that we expect to continue to grow on in 2026.

Okay. And then on the IG business, it looks like ordering facility count was down sequentially. Any color there? And then since you rolled out on the edge, you've been seeing a benefit from some pricing. I think you have Ultra the next iteration coming out shortly. So like anything baked into the guide around kind of additional pricing up a fair?

Thanks, David. On the utilization or account question, utilization has been fairly strong and from Q3 to Q4, relatively flat. On the account side, we did have year-over-year growth Q3 to Q4 down slightly, but Q3 was particularly strong in 2025. So as we look ahead, we continue to have a balance of reengaging accounts as well as adding new accounts. So our growth will come from a balance of accounts and adding new accounts as well as reengaging existing accounts and utilization at those. In terms of pricing, we did have some favorable pricing from Edge in 2025. And as we look ahead to launching Ultra here at some time in 2 we don't have specific uplift baked in for ultra ASPs into the guidance.

And this concludes our Q&A session. I will pass it back to Paul Badawi for his closing comments.

Thank you for attending today's call. We appreciate your interest in Sight Sciences, and we look forward to updating you on our progress in the future. Thank you.

And with that, we conclude our conference. Thank you for participating, and you may now disconnect.