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美国
证券交易委员会
华盛顿特区20549
表格 10-Q
(标记一个)
☒根据1934年证券交易法第13或15(d)条款的季度报告。
截至2024年6月30日季度结束 2024年9月30日
或 
☐根据1934年证券交易法第13或15(d)条款的过渡报告
过渡期从_____ 至 _____         
委员会档案编号： 001-37557
Penumbra, Inc.
（依凭章程所载的完整登记名称）
特拉华州05-0605598
(依据所在地或其他管辖区)
的注册地或组织地点)		(国税局雇主识别号码)
识别号码)

一个半影之所
阿拉米达, 加州 CA 94502
(总办事处地址，包括邮递区号)

(510) 748-3200
（注册人的电话号码，包括区号）
根据法案第12(b)条规定注册的证券：
每种类别的名称交易符号每个注册交易所的名称
普通股，每股面值为$0.001PEN纽约证券交易所
请用勾划标示出是否公司：（1）过去12个月内已提交证券交易法 1934 年第 13条或 15(d)条要求提交的所有报告（或对于公司需要提交该报告的较短期间），以及（2）过去90天公司一直受到该提交要求的影响。是: ☒未找到相关内容☐
请在勾选符号上注明，是否在过去的12个月内（或更短的时间内，如果注册人需提交此类文件），根据Regulation S-t第405条规定向本章第232.405条提交所需提交的每个交互式资料档案。是:  ☒没有：☐
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截至2024年10月16日，申报人持有 38,379,199 普通股$0.001面值每股，流通中。


目录


表格10-Q
目 录
 
页面


目录

第一部分 - 财务信息
第1项。综合缩表
penumbra inc.
缩短的合并财务报表
（未经审计）
（以千为单位）
2024年9月30日2023年12月31日
资产
流动资产:
现金及现金等价物$280,476 $167,486 
有价证券投资10,548 121,701 
应收帐款，扣除信用损失准备金 $3,329 15.13,169 于2024年9月30日和2023年12月31日，分别为　
176,051 201,768 
存货393,413 388,023 
预付费用及其他流动资产31,265 36,424 
全部流动资产891,753 915,402 
物业及设备，扣除折旧后净值59,919 72,691 
营运租赁权使用资产180,923 188,756 
融资租赁使用权资产28,888 31,092 
无形资产，扣除累计摊销6,920 71,056 
商誉166,355 166,270 
递延税105,851 85,158 
其他非流动资产38,514 25,880 
资产总额$1,479,123 $1,556,305 
550,714
流动负债：
应付账款$33,151 $27,155 
应付负债105,550 110,555 
当期营运租赁负债12,068 11,203 
当期融资租赁负债2,416 2,231 
流动负债合计153,185 151,144 
非流动经营租赁负债189,960 197,229 
非流动融资租赁负债22,245 23,680 
其他非流动负债9,453 5,308 
总负债374,843 377,361 
承诺事项和条件（注9）
股东权益：
普通股票38 39 
资本公积额额外增资1,079,193 1,047,198 
累积其他全面亏损 (963)(3,151)
保留收益26,012 134,858 
股东权益总额1,104,280 1,178,944 
负债和股东权益总额$1,479,123 $1,556,305 

详见未经核数之简明合并基本报表注解
2
目录

penumbra inc.
损益综合表简明合并报表
（未经审计）
(以千为单位，股票和每股金额除外)
截至9月30日的三个月截至9月30日的九个月
2024202320242023
营业收入$301,039 $270,946 $879,097 $773,843 
营业成本 100,733 93,228 334,823 278,192 
毛利润200,306 177,718 544,274 495,651 
营业费用：
研发 25,205 20,958 74,773 62,481 
销售、一般和管理费用 139,737 125,920 426,052 376,433 
取得中之研发前期支出— 18,215 — 18,215 
减损费用— — 76,945 — 
总营业费用 164,942 165,093 577,770 457,129 
营业利益（损失）35,364 12,625 (33,496)38,522 
利息收益及其他净收入4,414 679 10,026 2,970 
税前收入（亏损）39,778 13,304 (23,470)41,492 
所得税赋（减）益10,251 4,090 (3,799)4,756 
净利润（损失）$29,527 $9,214 $(19,671)$36,736 
每股净收益：
基础$0.76 $0.24 $(0.51)$0.96 
稀释$0.75 $0.23 $(0.51)$0.94 
加权平均股本数:
基础38,610,805 38,462,463 38,706,809 38,324,279 
稀释39,178,227 39,219,966 38,706,809 39,183,635 

详见未经核数之简明合并基本报表注解
3
目录

penumbra inc.
综合损益简明合并财务报表
（未经审计）
（以千为单位）
截至9月30日的三个月截至9月30日的九个月
2024202320242023
净利润（损失）$29,527 $9,214 $(19,671)$36,736 
其他综合损益（税后净额）：
外币兑换差异金额，净额税后3,185 (2,359)881 (1,302)
可供出售证券未实现收益或损失的净变动，税后900 698 1,307 2,186 
其他综合损益(净额)(税后)4,085 (1,661)2,188 884 
综合收益（损失）$33,612 $7,553 $(17,483)$37,620 

See accompanying notes to the unaudited condensed consolidated financial statements
4
Table of Contents

Penumbra, Inc.
Condensed Consolidated Statements of Stockholders’ Equity
(unaudited)
(in thousands, except share amounts)
Common StockAdditional Paid-in CapitalAccumulated Other Comprehensive LossRetained Earnings Total Stockholders’ Equity
SharesAmount
Balance at December 31, 202338,681,549 $39 $1,047,198 $(3,151)$134,858 $1,178,944 
Issuance of common stock76,597 — 238 — — 238 
Shares held for tax withholdings(1,732)— (421)— — (421)
Stock-based compensation— — 15,455 — — 15,455 
Other comprehensive loss— — — (1,687)— (1,687)
Net income — — — — 11,002 11,002 
Balance at March 31, 202438,756,414 $39 $1,062,470 $(4,838)$145,860 $1,203,531 
Issuance of common stock28,043 — 61 — — 61 
Issuance of common stock under employee stock purchase plan51,752 — 8,861 — — 8,861 
Shares held for tax withholdings(428)— (89)— — (89)
Stock-based compensation— — 9,277 — — 9,277 
Other comprehensive loss— — — (210)— (210)
Net loss— — — — (60,200)(60,200)
Balance at June 30, 202438,835,781 $39 $1,080,580 $(5,048)$85,660 $1,161,231 
Issuance of common stock45,678 — 484 — — 484 
Shares held for tax withholdings(375)— (72)— — (72)
Stock-based compensation— — 9,982 — — 9,982 
Repurchase of common stock(1)
(517,763)(1)(11,781)— (89,175)(100,957)
Other comprehensive income— — — 4,085 — 4,085 
Net income— — — — 29,527 29,527 
Balance at September 30, 202438,363,321 $38 $1,079,193 $(963)$26,012 $1,104,280 
    (1) Refer to Note “11. Share Repurchase Program” for more information on the repurchase of common stock during the quarter ended September 30, 2024.
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Penumbra, Inc.
Condensed Consolidated Statements of Stockholders’ Equity
(unaudited)
(in thousands, except share amounts)
Common StockAdditional Paid-in CapitalAccumulated Other Comprehensive LossRetained Earnings Total Stockholders’ Equity
SharesAmount
Balance at December 31, 202238,107,977 $38 $963,040 $(8,124)$43,904 $998,858 
Issuance of common stock134,936 — 2,209 — — 2,209 
Shares held for tax withholdings(813)— (204)— — (204)
Stock-based compensation— — 13,781 — — 13,781 
Other comprehensive income— — — 1,263 — 1,263 
Net income— — — — 8,562 8,562 
Balance at March 31, 202338,242,100 $38 $978,826 $(6,861)$52,466 $1,024,469 
Issuance of common stock114,930 — 1,614 — — 1,614 
Issuance of common stock under employee stock purchase plan51,264 — 8,385 — — 8,385 
Shares held for tax withholdings(2,689)— (822)— — (822)
Stock-based compensation— — 12,655 — — 12,655 
Other comprehensive income— — — 1,282 — 1,282 
Net income— — — — 18,960 18,960 
Balance at June 30, 202338,405,605 $38 $1,000,658 $(5,579)$71,426 $1,066,543 
Issuance of common stock95,927 — 834 834 
Issuance of common stock in connection with asset acquisition(1)
71,211 — 17,227 — — 17,227 
Shares held for tax withholdings(404)— (123)— — (123)
Stock-based compensation— — 12,104 — — 12,104 
Other comprehensive loss— — — (1,661)— (1,661)
Net income— — — 9,214 9,214 
Balance at September 30, 202338,572,339 $38 $1,030,700 $(7,240)$80,640 $1,104,138 
    (1) Refer to Note “6. Asset Acquisition” for more information on the impact of the asset acquisition during the quarter ended September 30, 2023.
See accompanying notes to the unaudited condensed consolidated financial statements
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Penumbra, Inc.
Condensed Consolidated Statements of Cash Flows
(unaudited)
(in thousands)
 Nine Months Ended September 30,
 20242023
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) income$(19,671)$36,736 
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation and amortization19,314 20,218 
Stock-based compensation34,069 39,725 
Impairment charge76,945 — 
Inventory write-downs40,946 5,250 
Deferred taxes(20,939)(35)
Acquired in-process research and development— 18,215 
Other1,404 2,623 
Changes in operating assets and liabilities:
Accounts receivable23,365 (6,609)
Inventories(45,992)(46,466)
Prepaid expenses and other current and non-current assets1,733 (10,288)
Accounts payable6,035 2,054 
Accrued expenses and other non-current liabilities164 (351)
Net cash provided by operating activities117,373 61,072 
CASH FLOWS FROM INVESTING ACTIVITIES:
Asset acquisition, net of cash acquired— (988)
Purchases of non-marketable investments(10,000)— 
Purchases of marketable investments(13,026)(73,370)
Proceeds from maturities of marketable investments125,816 46,070 
Purchases of property and equipment(15,811)(11,568)
Other1,600 (500)
Net cash provided by (used in) investing activities88,579 (40,356)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from exercises of stock options783 4,657 
Proceeds from issuance of stock under employee stock purchase plan8,861 8,385 
Payment of employee taxes related to vested stock(582)(1,149)
Payments of finance lease obligations(1,687)(1,456)
Repurchase of common stock(100,388)— 
Other(61)(155)
 Net cash (used in) provided by financing activities(93,074)10,282 
Effect of foreign exchange rate changes on cash and cash equivalents112 (99)
NET INCREASE IN CASH AND CASH EQUIVALENTS112,990 30,899 
CASH AND CASH EQUIVALENTS—Beginning of period167,486 69,858 
CASH AND CASH EQUIVALENTS—End of period$280,476 $100,757 
NONCASH INVESTING AND FINANCING ACTIVITIES:
Right-of-use assets obtained in exchange for operating lease obligations$1,941 $1,486 
Right-of-use assets obtained in exchange for finance lease obligations$437 $531 
Purchase of property and equipment funded through accounts payable and accrued liabilities$1,831 $1,275 
Fair value of common stock issued as consideration in connection with an asset acquisition$— $17,227 
Excise tax accrued on repurchase of common stock$566 $— 
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for amounts included in the measurement of operating lease liabilities$16,433 $14,985 
Cash paid for income taxes$14,367 $4,029 
See accompanying notes to the unaudited condensed consolidated financial statements
7
Table of Contents
Penumbra, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)

1. Organization and Description of Business
Penumbra, Inc. (the “Company”), the world’s leading thrombectomy company, is focused on developing the most innovative technologies for challenging medical conditions such as ischemic stroke, venous thromboembolism such as pulmonary embolism, and acute limb ischemia. The Company’s broad portfolio, which includes computer assisted vacuum thrombectomy (CAVT), centers on removing blood clots from head-to-toe with speed, safety and simplicity. The Company focuses on developing, manufacturing and marketing novel products for use by specialist physicians and other healthcare providers to drive improved clinical and health outcomes. The Company believes that the cost-effectiveness of its products is attractive to its customers.
2. Summary of Significant Accounting Policies
Basis of Presentation and Consolidation
The accompanying condensed consolidated balance sheet as of September 30, 2024, the condensed consolidated statements of operations, the condensed consolidated statements of comprehensive income (loss), and the condensed consolidated statements of stockholders’ equity for the three and nine months ended September 30, 2024 and 2023, and the condensed consolidated statements of cash flows for the nine months ended September 30, 2024 and 2023 are unaudited. The unaudited condensed consolidated financial statements included herein have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the applicable rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”) for interim financial information. Accordingly, they do not include all of the information and notes required by U.S. GAAP for complete financial statements. The condensed consolidated balance sheet data as of December 31, 2023 was derived from the audited financial statements as of that date.
The unaudited condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements and, in the opinion of management, reflect all adjustments of a normal recurring nature considered necessary to state fairly the Company’s financial position as of September 30, 2024, the results of its operations for the three and nine months ended September 30, 2024 and 2023, the changes in its comprehensive income (loss) and stockholders’ equity for the three and nine months ended September 30, 2024 and 2023, and its cash flows for the nine months ended September 30, 2024 and 2023. The results for the three and nine months ended September 30, 2024 are not necessarily indicative of the results that may be expected for the year ending December 31, 2024 or for any other future annual or interim period. Certain changes in presentation were made to interest income (expense), net and other income (expense), net in the condensed consolidated statements of operations for the three and nine months ended September 30, 2023 to conform to the presentation for the three and nine months ended September 30, 2024.
The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the audited consolidated financial statements and notes thereto for the fiscal year ended December 31, 2023, included in the Company’s Annual Report on Form 10-K as filed with the SEC on February 22, 2024. There have been no changes to the Company’s significant accounting policies during the nine months ended September 30, 2024, as compared to the significant accounting policies described in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023, other than changes to include the Company’s share repurchase policy in connection with an accelerated repurchase agreement that occurred during the three months ended September 30, 2024.
The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.
Use of Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and equity accounts; disclosure of contingent assets and liabilities at the date of the financial statements; and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, the Company evaluates its estimates, including those related to marketable investments, non-marketable investments, allowances for credit losses, the amount of variable consideration included in the transaction price, warranty reserve, valuation of inventories, useful lives of property and equipment, intangibles, operating and financing lease right-of-use (“ROU”) assets and liabilities, income taxes, the fair value of long-lived assets tested for impairment, and other contingencies, including the probability of achieving performance targets associated with equity awards with performance conditions, among
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Penumbra, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
others. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other data. Actual results could differ from those estimates.
Segments
The Company determined its operating segment on the same basis that it uses to evaluate its performance internally. The Company has one business activity: the design, development, manufacturing and marketing of innovative medical products, and operates as one operating segment. The Company’s chief operating decision-maker, its Chief Executive Officer, reviews its consolidated operating results for the purpose of allocating resources and evaluating financial performance.
Share Repurchases
Shares of our common stock repurchased pursuant to our repurchase program are retired. The par value of repurchased shares is deducted from common stock and the excess repurchase price over par value, as well as the portion due for excise taxes, is allocated to retained earnings on the consolidated balance sheets.
Recently Issued Accounting Standards
In December 2023, the FASB issued Accounting Standards Update (“ASU”) No. 2023-09, Income Taxes— Improvements to Income Tax Disclosures. The standard enhances annual income tax disclosures, by requiring additional disaggregated information about an entity’s effective tax rate reconciliation and income taxes paid. The ASU adds guidance that requires public business entities to disclose additional information in specified categories with respect to the reconciliation of the effective tax rate to the statutory rate (the rate reconciliation) for federal, state, and foreign income taxes. It also requires greater detail about individual reconciling items in the rate reconciliation to the extent the impact of those items exceeds a specified threshold (5%). In addition to new disclosures associated with the rate reconciliation, the ASU requires information pertaining to taxes paid (net of refunds received) to be disaggregated for federal, state, and foreign taxes and further disaggregated for specific jurisdictions to the extent the related amounts exceed the quantitative threshold. For public business entities, the amendments in ASU 2023-09 are effective for annual periods beginning after December 15, 2024. Early adoption is permitted for annual financial statements not yet issued or made available for issuance. The Company is assessing the impact the new guidance will have on the disclosures within its consolidated financial statements and does not elect to early adopt as of September 30, 2024.
In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The ASU expands public entities’ segment disclosures by requiring disclosure of significant segment expenses that are regularly reviewed by the CODM and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items, and interim disclosures of a reportable segment’s profit or loss and assets. The ASU also allows, in addition to the measure that is most consistent with U.S. GAAP, the disclosure of additional measures of segment profit or loss that are used by the CODM in assessing segment performance and deciding how to allocate resources. All disclosure requirements under ASU 2023-07 are also required for public entities with a single reportable segment. The ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, on a retrospective basis, with early adoption permitted. The Company is assessing the impact the new guidance will have on the disclosures within its consolidated financial statements and does not elect to early adopt as of September 30, 2024.
In March 2024, the SEC issued Release Nos. 33-11275; 34-99678 "The Enhancement and Standardization of Climate-Related Disclosures for Investors", which will require registrants to provide certain climate-related information in their registration statements and annual reports, including information about a registrant’s climate-related risks that have materially impacted, or are reasonably likely to have a material impact on, its business strategy, results of operations, or financial condition, as well as certain disclosures related to severe weather events and other natural conditions in a registrant’s audited financial statements. The disclosure requirements follow a phase-in timeline, with initial requirements beginning with the Company's annual report for the year ending December 31, 2025. On April 4, 2024, the SEC voluntarily stayed implementation of this new rule pending judicial review. The Company is currently analyzing the impact that the new climate-related rules will have on the disclosures within its consolidated financial statements and will continue to monitor the status of the rules while legal challenges are pending.
3. Investments and Fair Value of Financial Instruments
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Table of Contents
Penumbra, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
Marketable and Non-Marketable Investments
The Company’s marketable and non-marketable investments have been classified and accounted for as available-for-sale. The Company’s marketable and non-marketable investments as of September 30, 2024 and December 31, 2023 were as follows (in thousands):
September 30, 2024
Securities with net gains or losses in accumulated other comprehensive income (loss)
Amortized CostGross Unrealized GainsGross Unrealized LossesAllowance
 for
 Credit Loss		Fair Value
Marketable investments:
Commercial paper $2,781 $1 $— $— $2,782 
U.S. treasury7,779 — (13)$— 7,766 
Total10,560 1 (13)— 10,548 
Non-marketable investments:
Non-marketable debt securities10,000 1,000 — — 11,000 
Total10,000 1,000 — — 11,000 
Total $20,560 $1,001 $(13)$— $21,548 
December 31, 2023
Securities with net gains or losses in accumulated other comprehensive income (loss)
Amortized CostGross Unrealized GainsGross Unrealized LossesAllowance
 for
 Credit Loss		Fair Value
Marketable investments:
Commercial paper $39,727 $32 $(3)$— $39,756 
Certificate of Deposit6,392 9 — — 6,401 
U.S. treasury10,226 — (160)— 10,066 
U.S. states and municipalities2,950 — (35)— 2,915 
Corporate bonds62,964 29 (430)— 62,563 
Total$122,259 $70 $(628)$— $121,701 
As of September 30, 2024, the total amortized cost basis of the Company’s available-for-sale debt securities, excluding non-marketable debt securities, in an unrealized loss position exceeded its fair value by an immaterial amount. The Company reviewed its available-for-sale securities in an unrealized loss position and concluded that the decline in fair value was not related to credit losses and is recoverable. As of September 30, 2024, the Company’s non-marketable available-for sale debt securities were not in an unrealized loss position. During the three and nine months ended September 30, 2024, no allowance for credit losses was recorded and instead the unrealized losses are reported as a component of accumulated other comprehensive loss.
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Penumbra, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
The following tables present the gross unrealized losses and the fair value for those marketable investments that were in an unrealized loss position for less than and more twelve months as of September 30, 2024 and December 31, 2023 (in thousands):
September 30, 2024
Less than 12 monthsMore than 12 monthsTotal
Fair ValueGross Unrealized LossesFair ValueGross Unrealized LossesFair ValueGross Unrealized Losses
Marketable investments:
U.S. treasury2,804 (4)4,963 (9)7,767 (13)
Total$2,804 $(4)$4,963 $(9)$7,767 $(13)
December 31, 2023
Less than 12 monthsMore than 12 monthsTotal
Fair ValueGross Unrealized LossesFair ValueGross Unrealized LossesFair ValueGross Unrealized Losses
Marketable investments:
Commercial paper$16,241 $(3)$— $— $16,241 $(3)
U.S. treasury5,677 (54)4,389 (106)10,066 (160)
U.S. states and municipalities— — 2,915 (35)2,915 (35)
Corporate bonds15,945 (2)30,912 (428)46,857 (430)
Total$37,863 $(59)$38,216 $(569)$76,079 $(628)
The contractual maturities of the Company’s marketable investments as of September 30, 2024 (in thousands):
September 30, 2024
Marketable investments:Amortized CostFair Value
Due in one year$7,753 $7,744 
Due in one to five years2,807 2,804 
Total$10,560 $10,548 
Non-Marketable Investments
During the three months ended March 31, 2024, the Company completed a strategic investment in a privately held company. Under the terms of the investment, the Company paid $10.0 million in exchange for shares of Series B preferred stock which represented an immaterial investment in the outstanding equity securities of the privately held company. The Company determined that the investment did not meet the criteria to be accounted for as an equity method investment under ASC 323. The investment was accounted for as an available-for-sale debt security in accordance with ASC 320 as the preferred stock contains a contingent redemption feature at the Company’s option. The investment is included in other non-current assets on the condensed consolidated balance sheet and changes in fair value are recorded in total other comprehensive income (loss), net of tax.
Fair Value of Financial Instruments
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. The accounting guidance establishes a three-tiered hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value:
Level 1 - Quoted prices in active markets for identical assets or liabilities.
Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
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Penumbra, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
The categorization of a financial instrument within the valuation hierarchy is based on the lowest level of input that is significant to the fair value measurement.
The Company classifies its cash equivalents and marketable investments within Level 1 and Level 2, as it uses quoted market prices or alternative pricing sources and models utilizing market observable inputs. The Company classifies its non-marketable investments in preferred stock in privately held companies within Level 3, as they do not have a readily determinable fair value.
The Company determined the fair value of its Level 1 financial instruments, which are traded in active markets, using quoted market prices for identical instruments.
Marketable investments classified within Level 2 of the fair value hierarchy are valued based on other observable inputs, including broker or dealer quotations or alternative pricing sources. When quoted prices in active markets for identical assets or liabilities are not available, the Company relies on non-binding quotes from its investment managers, which are based on proprietary valuation models of independent pricing services. These models generally use inputs such as observable market data, quoted market prices for similar instruments, historical pricing trends of a security as relative to its peers. To validate the fair value determination provided by its investment managers, the Company reviews the pricing movement in the context of overall market trends and trading information from its investment managers. In addition, the Company assesses the inputs and methods used in determining the fair value in order to determine the classification of securities in the fair value hierarchy.
Non-marketable investments classified within Level 3 of the fair value hierarchy are valued based on unobservable inputs that are supported by little or no market activity. Current financial information of private companies may not be available and consequently the Company estimates the fair value using inputs that are based on the best available information at the measurement date. Key inputs may include the most recent financial information, financial projections, and financing transactions available for the investee and other quantitative and qualitative factors. Additionally, based on the timing, volume, and other characteristics of the available information, the Company may supplement this information by using one or more valuation techniques, including market and income approaches. The Company did not hold any non-marketable investments classified within Level 3 as of September 30, 2023 or December 31, 2023.
The following table summarizes the changes in fair value of our Level 3 non-marketable debt securities for the three and nine months ended September 30, 2024 (in thousands):
Three Months Ended September 30,Nine Months Ended September 30,
 20242024
Balance, beginning of the period$10,096 $— 
Total gains included in other comprehensive income (loss)904 1,000 
Purchases— 10,000 
Balance, end of the period$11,000 $11,000 
The Company did not hold any Level 3 marketable investments as of September 30, 2024 or December 31, 2023. During the nine months ended September 30, 2024 and 2023, the Company did not have any transfers between Level 1, Level 2 or Level 3 of the fair value hierarchy for marketable or non-marketable investments. Additionally, the Company did not have any financial assets and liabilities measured at fair value on a non-recurring basis as of September 30, 2024 or December 31, 2023.
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Penumbra, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
The following tables set forth the Company’s financial assets and liabilities measured at fair value by level within the fair value hierarchy as of September 30, 2024 and December 31, 2023 (in thousands):
 As of September 30, 2024
 Level 1Level 2Level 3Fair Value
Financial Assets
Cash equivalents:
Commercial paper$— $93,860 $— $93,860 
Certificate of deposit— 22,859 — 22,859 
Money market funds80,349 — — 80,349 
U.S. treasury5,371 — — 5,371 
Marketable investments:
Commercial paper— 2,782 — 2,782 
Certificate of deposit— — — — 
U.S. treasury7,766 — — 7,766 
Non-marketable investments:
Non-marketable investments— — 11,000 11,000 
Total$93,486 $119,501 $11,000 $223,987 
 As of December 31, 2023
 Level 1Level 2Level 3Fair Value
Financial Assets
Cash equivalents:
Money market funds$86,991 $— $— $86,991 
Marketable investments:
Commercial paper— 39,756 — 39,756 
Certificate of Deposit— 6,401 — 6,401 
U.S. treasury10,066 — — 10,066 
U.S. states and municipalities— 2,915 — 2,915 
Corporate bonds— 62,563 — 62,563 
Total$97,057 $111,635 $— $208,692 

4. Impairment and Restructuring Costs of Immersive Healthcare Asset Group
The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. During the three months ended June 30, 2024, the Company made the strategic decision to explore alternative avenues for its Immersive Healthcare business; as a consequence to this decision, the Company tested the Immersive Healthcare asset group’s long-lived assets for impairment. Prior to the three months ended June 30, 2024, there were no events or circumstances that indicated the need to test for impairment.
The Immersive Healthcare asset group included substantially all the assets and liabilities associated with the Immersive Healthcare business, which primarily consisted of finite-lived developed technology intangible assets, inventory, and property and equipment associated with the developed technology. Prior to performing a recoverability test for the asset group, the Company recorded a $33.4 million charge to cost of revenue in the unaudited condensed consolidated statements of operations during the three months ended June 30, 2024 for the write-down of Immersive Healthcare inventory to net realizable value.
The Company then performed a recoverability test for the asset group, comparing the carrying amount of the asset group to the sum of its estimated undiscounted future cash flows. The carrying amount of the asset group was determined to be not recoverable, as it exceeded the undiscounted future cash flows.
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Penumbra, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
Accordingly, the Company measured the impairment loss by calculating the excess of the asset group's carrying amount over its fair value. The fair value of the asset group was determined using a discounted cash flow approach, which is considered a Level 3 measurement within the fair value hierarchy and utilized significant Level 3 inputs such as expected future cash flows, including forecasted sales, gross profit and operating expenses, and the use of an appropriate discount rate. As a result of this assessment, the Company recorded a pre-tax impairment charge of $76.9 million during the three months ended June 30, 2024, which was primarily comprised of $58.9 million in finite-lived intangible assets and $18.0 million in property and equipment.
During the third quarter of 2024, the Company made the decision to wind down and exit its Immersive Healthcare business. As a result, during the three and nine months ended September 30, 2024, the Company incurred $5.0 million in restructuring and related charges for severance and other costs related to the wind down of the Immersive Healthcare business. These costs were included in research and development and sales, general and administrative within the condensed consolidated statements of operations. As of September 30, 2024, unpaid severance of $3.5 million was included in accrued liabilities within the condensed consolidated balance sheets.
The following table details the costs incurred during the three and nine months ended September 30, 2024 associated with the wind down of the Immersive Healthcare business (in thousands):
 Three and Nine Months Ended September 30, 2024
Severance and other associated costs$4,971 
Total$4,971 
The following table details the change in accruals associated with the wind down of the Immersive Healthcare business as of September 30, 2024 (in thousands):
Severance and other associated costs
Balance as of January 1, 2024$— 
Cost incurred and charged to expense4,971 
Costs paid or otherwise settled(1,444)
Balance as of September 30, 2024$3,527 
5. Balance Sheet Components
Inventories
The components of inventories consisted of the following (in thousands):
 September 30, 2024December 31, 2023
Raw materials$126,574 $119,511 
Work in process40,540 34,489 
Finished goods226,299 234,023 
Inventories$393,413 $388,023 
During the three months ended June 30, 2024, the Company recorded a $33.4 million charge to cost of revenue in the unaudited condensed consolidated statements of operations for the write-down of Immersive Healthcare inventory to net realizable value. Refer to Note “4. Impairment and Restructuring Costs of Immersive Healthcare Asset Group” for more details.
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Penumbra, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
Property and Equipment, Net
Property and equipment, net consisted of the following (in thousands):
September 30, 2024December 31, 2023
Machinery and equipment$47,724 $43,152 
Furniture and fixtures18,910 18,049 
Leasehold improvements36,476 29,241 
Software5,648 19,939 
Computers19,416 18,427 
Construction in progress3,683 3,535 
Total property and equipment131,857 132,343 
Less: Accumulated depreciation and amortization(71,938)(59,652)
Property and equipment, net$59,919 $72,691 
During the three months ended June 30, 2024, the Company recorded an impairment of property and equipment charge of $18.0 million, primarily related to software. Refer to Note “4. Impairment and Restructuring Costs of Immersive Healthcare Asset Group” for more details.
Accrued Liabilities
The components of accrued liabilities consisted of the following (in thousands):
 September 30, 2024December 31, 2023
Payroll and employee-related expenses$67,926 $65,395 
Accrued expenses15,181 11,711 
Deferred revenue1,214 6,985 
Other accrued liabilities21,229 26,464 
Total accrued liabilities$105,550 $110,555 
The following table shows the changes in the Company’s estimated product warranty accrual, included in accrued liabilities, for the nine months ended September 30, 2024 and twelve months ended December 31, 2023, respectively (in thousands):
 September 30, 2024December 31, 2023
Balance at the beginning of the period$5,755 $5,370 
Accruals of warranties issued, net(2,406)1,865 
Settlements of warranty claims(1,359)(1,480)
Balance at the end of the period$1,990 $5,755 
6. Asset Acquisition
On September 29, 2023 (the “Closing Date”), the Company acquired an In-Process Research and Development (“IPR&D”) asset in an asset acquisition. On the Closing Date, the Company recorded an $18.2 million charge to acquired IPR&D expense in the condensed consolidated statements of operations as the IPR&D asset had no alternative future use.
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Penumbra, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
IPR&D acquired in an asset acquisition is recorded using the cost accumulation model and is immediately expensed if there is no alternative future use at the time of acquisition.
The total consideration transferred was allocated to the non-monetary assets acquired and liabilities assumed using the cost accumulation model based on their relative fair value. The following table summarizes the Closing Date fair value of the consideration transferred (in thousands):
Fair value of common stock consideration(1)
$17,227 
Payment of certain acquiree transaction costs and other liabilities on behalf of acquiree(2)
1,001 
Total purchase price$18,228 
(1)The fair value of the 71,211 shares of common stock issued as part of consideration transferred was determined based on the Closing Date market price of the Company’s common stock of $241.91.
(2)Transaction costs and other pre-existing liabilities paid on behalf of the acquiree as part of the consideration transferred for the IPR&D are presented in the investing activities section of the condensed consolidated statements of cash flows.
7. Intangible Assets
The following table presents details of the Company’s acquired intangible assets as of September 30, 2024 and December 31, 2023 (in thousands, except weighted-average amortization period):
As of September 30, 2024Weighted-Average Amortization PeriodGross Carrying AmountAccumulated AmortizationNet
Finite-lived intangible assets:
Developed technology(1)
8.8 years$83,289 $(83,289)$— 
Customer relationships15.0 years6,653 (3,215)3,438 
Trade secrets and processes20.0 years5,256 (1,774)3,482 
Total intangible assets 17.5 years$95,198 $(88,278)$6,920 
(1)During the three months ended June 30, 2024, the Company recorded an impairment of developed technology charge of $58.9 million included within accumulated amortization in the table above. Refer to Note “4. Impairment and Restructuring Costs of Immersive Healthcare Asset Group” for more details.
As of December 31, 2023Weighted-Average
Amortization Period		Gross Carrying AmountAccumulated AmortizationNet
Finite-lived intangible assets:
Developed technology8.8 years$83,289 $(19,640)$63,649 
Customer relationships15.0 years6,579 (2,851)3,728 
Trade secrets and processes20.0 years5,256 (1,577)3,679 
Total intangible assets9.6 years$95,124 $(24,068)$71,056 
The gross carrying amount and accumulated amortization of the customer relationships are the only intangible assets subject to foreign currency translation effects. The Company’s $5.3 million trade secrets and processes intangible asset was recognized in connection with a royalty buyout agreement in 2018.
The following table presents the amortization recorded related to the Company’s finite-lived intangible assets for the three and nine months ended September 30, 2024 and 2023 (in thousands):
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Penumbra, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
 Three Months Ended September 30,Nine Months Ended September 30,
 2024202320242023
Cost of revenue$66 $66 $197 $197 
Sales, general and administrative(1)
110 2,487 5,083 7,461 
Total$176 $2,553 $5,280 $7,658 
(1)This does not include the impairment charge of $58.9 million related to the Company’s Immersive Healthcare developed technology during the three months ended June 30, 2024. Refer to Note “4. Impairment and Restructuring Costs of Immersive Healthcare Asset Group” for more information.
8. Goodwill
The following table presents the changes in goodwill during the nine months ended September 30, 2024 (in thousands):
Total Company
Balance as of December 31, 2023$166,270 
Foreign currency translation 85 
Balance as of September 30, 2024$166,355 
Goodwill Impairment Review
The Company reviews goodwill for impairment annually on October 31, or more frequently if events or circumstances indicate that an impairment loss may have occurred. The Company operates as one segment, which is the sole reporting unit of the Company, and therefore goodwill is tested for impairment at the consolidated level. Accordingly, when assessing whether an impairment test is required more frequently than on its annual testing date, the Company considers whether events or circumstances have taken place that indicate it is more likely than not that the Company’s enterprise fair value is less than the carrying amount of its one reporting unit, including goodwill. Due to the impairment of the Immersive Healthcare asset group during the three months ended June 30, 2024, the Company assessed the reporting unit for impairment and determined there was no impairment of goodwill. The Company also determined there were no impairment indicators as of September 30, 2024.
9. Commitments and Contingencies
Royalty Obligations
In March 2005, the Company entered into a license agreement that requires the Company to make minimum royalty payments to the licensor on a quarterly basis. As of December 31, 2018, the license agreement required minimum annual royalty payments of $0.1 million in equal quarterly installments. In July 2019, the Company amended the license agreement to extend its term for an additional ten years and to increase the required minimum annual royalty payments by $0.2 million for a required minimum annual royalty payment of $0.3 million. Unless terminated earlier, the term of the amended license agreement shall expire June 30, 2029.
Royalty expense included in cost of sales for the three months ended September 30, 2024 and 2023 was $0.7 million and $0.7 million, respectively, and for the nine months ended September 30, 2024 and 2023, was $2.0 million and $2.0 million respectively.
Contingencies
From time to time, the Company may have certain contingent liabilities that arise in the ordinary course of business. The Company accrues a liability for such matters when it is probable that future expenditures will be made and such expenditures can be reasonably estimated.
Indemnification
The Company enters into standard indemnification arrangements in the ordinary course of business. In many such arrangements, the Company agrees to indemnify, hold harmless, and reimburse the indemnified parties for losses suffered or incurred by the indemnified parties in connection with any trade secret, copyright, patent or other intellectual property
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Penumbra, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
infringement claim by any third-party with respect to the Company’s technology. The Company also agrees to indemnify many indemnified parties for product defect and similar claims. The term of these indemnification agreements is generally perpetual. The maximum potential amount of future payments the Company could be required to make under these agreements is not determinable because it involves claims that may be made against the Company in the future, but have not yet been made.
The Company has entered into indemnification agreements with its directors and officers that may require the Company to indemnify its directors and officers against liabilities that may arise by reason of their status or service as directors or officers, other than liabilities arising from willful misconduct of the individual.
The Company has not incurred costs to defend lawsuits or settle claims related to these indemnification agreements. No liability associated with any of these indemnification requirements has been recorded to date.
Litigation
From time to time, the Company is subject to certain legal proceedings, as well as demands, claims and threatened litigation that arise in the normal course of our business. The Company reviews the status of each significant matter quarterly and assesses its potential financial exposure. If the potential loss from a claim or legal proceeding is considered probable and the amount can be reasonably estimated, the Company records a liability and an expense for the estimated loss and discloses it in the Company’s financial statements if it is material. If the Company determines that a loss is possible and the range of the loss can be reasonably determined, the Company does not record a liability or an expense but the Company discloses the range of the possible loss. The Company bases its judgments on the best information available at the time. As additional information becomes available, the Company reassesses the potential liability related to its pending claims and litigation and may revise its estimates.
On April 7, 2023, a former contractor who had been retained by the Company through a third party staffing agency filed a putative class action lawsuit as well as a Private Attorney General Act (“PAGA”) representative action complaint against the Company in the Superior Court of the State of California for the County of Alameda, on behalf of the contractor and similarly situated Company contractors and employees in California, alleging various claims pursuant to the California Labor Code related to wages, overtime, meal and rest breaks, reimbursement of business expenses, wage statements and records, and other similar allegations. Additionally, on April 10, 2023, a current employee of the Company filed a PAGA representative action complaint against the Company in the Superior Court of the State of California for the County of Alameda, on behalf of the employee and similarly situated Company employees in California, alleging similar claims. The complaints seek payment of various alleged unpaid wages, penalties, interest and attorneys’ fees in unspecified amounts. Following mediation in April 2024, in May 2024 the parties entered into a formal agreement to settle the claims for an aggregate amount of $4.6 million, subject to approval by the court. The proposed settlement agreement was initially submitted to the court for preliminary approval on June 18, 2024, and the court granted preliminary approval of the settlement agreement on October 14, 2024. The Company recorded an accrual of $4.6 million in its financial statements for the three months ended March 31, 2024 related to these matters. There have been no changes to the accrual as of September 30, 2024.
10. Stockholders’ Equity
Common Stock
On September 29, 2023, the Company issued 71,211 shares of common stock as part of the total consideration transferred in connection with an asset acquisition. Refer to Note “6. Asset Acquisition” for more details.
Stock-based Compensation
Stock-based compensation expense is associated with restricted stock units (“RSUs”), RSUs with performance conditions (“PSUs”), stock options, and the Company’s Employee Stock Purchase Plan (“ESPP”).
Certain PSUs granted to senior management during the nine months ended September 30, 2024, will vest subject to the achievement of pre-established financial performance targets for the year ending December 31, 2024, and continued service. The fair value of these PSUs is based on the closing price of the Company's common stock on the date of grant. Stock-based compensation costs associated with these PSUs are recognized over the requisite service period of 4.25 years using graded vesting which results in more accelerated expense recognition compared to traditional time-based vesting over the same vesting period. Each reporting period, the Company monitors the probability of achieving the performance targets and may adjust periodic stock-based compensation expense based on its determination of the likelihood of achieving these performance targets and the estimated number of shares of common stock that will vest. The actual number of PSUs awarded is based on the actual performance during the performance period compared to the performance targets.
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Penumbra, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
The following table sets forth the stock-based compensation expense included in the Company’s condensed consolidated statements of operations for the three and nine months ended September 30, 2024 and 2023 (in thousands):
 Three Months Ended September 30,Nine Months Ended September 30,
 2024202320242023
Cost of revenue$1,140 $1,428 $3,315 $3,900 
Research and development1,201 2,219 5,115 6,928 
Sales, general and administrative8,599 10,489 25,639 28,897 
Total$10,940 $14,136 $34,069 $39,725 
As of September 30, 2024, total unrecognized compensation cost related to unvested share-based compensation arrangements, excluding PSUs, was $45.8 million, which is expected to be recognized over a weighted average period of 2.5 years.
As of September 30, 2024, total unrecognized compensation cost related to unvested PSU share-based compensation arrangements was $12.9 million, which is expected to be recognized over a weighted average period of 2.9 years.
The total stock-based compensation cost capitalized in inventory was $1.0 million and $1.3 million as of September 30, 2024 and December 31, 2023, respectively.
11. Share Repurchase Program
On August 5, 2024, the Company’s Board of Directors approved a share repurchase authorization in the amount of up to $200.0 million, allowing the Company to repurchase its common stock from time to time at such prices as it deems appropriate through open market purchases, block transactions, privately negotiated transactions, including accelerated share repurchase transactions, or otherwise. The repurchase authorization expires on July 31, 2025.
Under this authorization, the Company entered into an accelerated share repurchase agreement (“ASR”) with JPMorgan Chase Bank, National Association (the “Dealer”) to repurchase $100.0 million of the Company’s common stock during the three months ended September 30, 2024. Under the ASR, the Company made an initial payment of $100.0 million to the Dealer and received an initial delivery of 473,962 shares of common stock. The ASR program concluded on September 16, 2024 and the Company received an additional 43,801 shares, which was determined using a price of 193.14 based on the average of the daily volume-weighted average prices of the Company’s common stock during the term of the ASR, less a discount pursuant to the terms of the ASR. The Company received an aggregate of 517,763 shares of common stock for a total cost of $100.4 million, including legal and financial advisor fees of $0.4 million associated with the repurchase. Additionally, the Company recorded an excise tax of $0.6 million, which has been included in retained earnings as part of the cost basis of the stock repurchased, and accrued liabilities in the condensed consolidated balance sheets.
All shares repurchased were immediately retired and reduced the weighted-average number of shares of common stock outstanding used in the computation of basic and diluted earnings per share. The forward contract upon final settlement did not impact weighted average common shares outstanding used in the computation of diluted earnings per share. As of September 30, 2024, the Company had remaining authority to purchase $100.0 million of its common stock under the share repurchase authorization.
12. Accumulated Other Comprehensive Loss
Other comprehensive income (loss) consists of two components: unrealized gains or losses on the Company’s available-for-sale marketable investments, non-marketable investments, and gains or losses from foreign currency translation adjustments. Until realized and reported as a component of consolidated net income (loss), these comprehensive income (loss) items accumulate and are included within accumulated other comprehensive loss. Unrealized gains and losses on our marketable investments are reclassified from accumulated other comprehensive loss into earnings when realized upon sale, and are determined based on specific identification of securities sold. Gains and losses from the translation of assets and liabilities denominated in non-U.S. dollar functional currencies are included in accumulated other comprehensive loss.
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Penumbra, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
The following table summarizes the changes in the accumulated balances during the period, and includes information regarding the manner in which the reclassifications out of accumulated other comprehensive loss into earnings affect our condensed consolidated statements of comprehensive income (loss) (in thousands):
Three Months Ended September 30, 2024Three Months Ended September 30, 2023
 Marketable
Investments		Non-Marketable Investments Currency Translation
Adjustments		 Total Marketable
Investments		Non-Marketable Investments Currency Translation
Adjustments		 Total
Balance, beginning of the period$(247)$96 $(4,897)$(5,048)$(2,012)$— $(3,567)$(5,579)
Other comprehensive loss before reclassifications:
Unrealized gains — investments234 904 — 1,138 698 — — 698 
Foreign currency translation gains (losses)— — 3,185 3,185 — — (2,359)(2,359)
Income tax effect — expense(238)— — (238)— — — — 
Net of tax(4)904 3,185 4,085 698 — (2,359)(1,661)
Net current-year other comprehensive income (loss)(4)904 3,185 4,085 698 — (2,359)(1,661)
Balance, end of the period$(251)$1,000 $(1,712)$(963)$(1,314)$— $(5,926)$(7,240)
Nine Months Ended September 30, 2024Nine Months Ended September 30, 2023
Marketable
Investments		Non-Marketable InvestmentsCurrency Translation
Adjustments		TotalMarketable
Investments		Non-Marketable InvestmentsCurrency Translation
Adjustments		Total
Balance, beginning of the period$(558)$— $(2,593)$(3,151)$(3,500)$— $(4,624)$(8,124)
Other comprehensive loss before reclassifications:
Unrealized gains — investments545 1,000 — 1,545 2,186 — — 2,186 
Foreign currency translation gains (losses)— — 877 877 — — (1,302)(1,302)
Income tax effect — expense(238)— 4 (234)— — — — 
Net of tax307 1,000 881 2,188 2,186 — (1,302)884 
Net current-year other comprehensive income307 1,000 881 2,188 2,186 — (1,302)884 
Balance, end of the period$(251)$1,000 $(1,712)$(963)$(1,314)$— $(5,926)$(7,240)
13. Income Taxes
The Company’s income tax expense (benefit), deferred tax assets and liabilities, and reserves for unrecognized tax benefits reflect management’s best assessment of estimated current and future taxes to be paid. The Company is subject to income taxes in both the United States and foreign jurisdictions. Significant judgment and estimates are required in determining the consolidated income tax expense (benefit).
During interim periods, the Company generally utilizes the estimated annual effective tax rate (“AETR”) method which involves the use of forecasted information. Under the AETR method, the provision is calculated by applying the estimated AETR for the full fiscal year to “ordinary” income or loss (pretax income or loss excluding unusual or infrequently occurring discrete items) for the reporting period. Jurisdictions with tax assets for which the Company believes a tax benefit cannot be realized are excluded from the computation of its AETR.
During the three months ended June 30, 2024, the Company recorded a pre-tax impairment charge of $76.9 million for finite-lived intangible assets, property and equipment, and another $33.4 million charge to cost of revenue. Refer to Note “4. Impairment and Restructuring Costs of Immersive Healthcare Asset Group” for more information. According to ASC 740-270-30-8 guidance for significant unusual or infrequently occurring items that are separately reported, the $26.5 million income tax benefit as a result of the impairment charge was excluded from the calculation of the Company’s estimated annual effective tax rate.
The Company’s provision for income taxes was $10.3 million for the three months ended September 30, 2024, which was primarily due to tax expenses attributable to its worldwide profits. The Company’s benefit from income taxes was $3.8 million for the nine months ended September 30, 2024, which was primarily due to a discrete tax benefit from the impairment charge related to the Immersive Healthcare asset group, partially offset by tax expenses attributable to its worldwide profits.
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Penumbra, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
The Company’s provision for income taxes was $4.1 million and $4.8 million for the three and nine months ended September 30, 2023, respectively, which was primarily due to tax expenses attributable to its worldwide profits and a discrete tax charge resulting from non-deductible acquired in-process research and development expense associated with the asset acquisition, offset by excess tax benefits from stock-based compensation attributable to its U.S. jurisdiction.
The Company’s effective tax rate decreased to 25.8% for the three months ended September 30, 2024, from 30.7% for the three months ended September 30, 2023, primarily due to a discrete tax charge resulting from the non-deductible acquired in-process research and development expense associated with an asset acquisition in 2023. The effective tax rate increased to 16.2% for the nine months ended September 30, 2024, from 11.5% for the nine months ended September 30, 2023, primarily due to decrease in excess tax benefits from stock-based compensation attributable to the U.S. jurisdiction in 2024.
Significant domestic deferred tax assets (“DTAs”) were generated in recent years, primarily due to excess tax benefits from stock option exercises and vesting of restricted stock units. The Company evaluates all available positive and negative evidence, objective and subjective in nature, in each reporting period to determine if sufficient taxable income will be generated to realize the benefits of its DTAs and, if not, a valuation allowance to reduce the DTAs is recorded. As of September 30, 2024, the Company maintains a valuation allowance primarily against its California R&D tax credit DTAs for which the Company does not believe a tax benefit is more likely than not to be realized due to the computation of California taxes under the single sales factor and non-conformity of the Section 174 capitalization rule.
The Company maintains that all foreign earnings, with the exception of a portion of the earnings of its German subsidiary, are permanently reinvested outside the United States and therefore deferred taxes attributable to such earnings are not provided for in the Company’s condensed consolidated financial statements as of September 30, 2024.
14. Net Income (Loss) per Share
The Company computed basic net income (loss) per share based on the weighted average number of shares of common stock outstanding during the period. The Company computed diluted net income (loss) per share based on the weighted average number of shares of common stock outstanding plus potentially dilutive common stock equivalents outstanding during the period. For the purposes of this calculation, stock options, restricted stock units, performance stock units, and stock sold through the ESPP are considered common stock equivalents.
A reconciliation of the numerator and denominator used in the calculation of the basic and diluted net income (loss) per share is as follows (in thousands, except share and per share amounts):
 Three Months Ended September 30,Nine Months Ended September 30,
 2024202320242023
Numerator:
Net income (loss)$29,527 $9,214 $(19,671)$36,736 
Denominator:
Weighted average shares used to compute net income (loss) attributable to common stockholders:
Basic38,610,805 38,462,463 38,706,809 38,324,279 
Potential dilutive stock-based options and awards567,422 757,503 — 859,356 
Diluted39,178,227 39,219,966 38,706,809 39,183,635 
Net income (loss) per share:
Basic$0.76 $0.24 $(0.51)$0.96 
Diluted$0.75 $0.23 $(0.51)$0.94 
For the three months ended September 30, 2024 and 2023, outstanding stock-based awards of 11 thousand and 13 thousand shares, respectively, and for the nine months ended September 30, 2024 and 2023 outstanding stock-based awards of 1,226 thousand and 11 thousand shares, respectively, were excluded from the computation of diluted net income (loss) per share because their effect would have been anti-dilutive in the relevant periods.
15. Interest and other income (expense), net
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Penumbra, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
The following table shows the components of interest and other income (expense), net for the three and nine months ended September 30, 2024 and 2023 and (in thousands):
 Three Months Ended September 30,Nine Months Ended September 30,
 2024202320242023
Interest income$3,465 $1,565 $10,414 $3,819 
Interest expense(336)(442)(1,081)(1,303)
Other income (expense), net(1)
1,285 (444)693 454 
Interest and other income, net$4,414 $679 $10,026 $2,970 
(1)Consists primarily of the effects of foreign currency gains or losses.
16. Revenues
Revenue Recognition
Revenue is recognized in an amount that reflects the consideration the Company expects to be entitled to in exchange for goods or services. All revenue recognized in the condensed consolidated statements of operations is considered to be revenue from contracts with customers.
Certain changes in presentation were made to the Company’s revenues disaggregated by product categories for the period ended September 30, 2023 to conform to the presentation for the period ended September 30, 2024. During the year ended December 31, 2023, the Company made changes to its product categories to provide investors with more meaningful information to understand the performance of its business and strategic direction.
The Company’s revenues disaggregated by geography, based on the destination to which the Company ships its products, for the three and nine months ended September 30, 2024 and 2023 was as follows (in thousands):
 Three Months Ended September 30,Nine Months Ended September 30,
 2024202320242023
United States$226,326 $194,816 $654,150 $553,467 
International74,713 76,130 224,947 220,376 
Total$301,039 $270,946 $879,097 $773,843 
The Company’s revenues disaggregated by product category for the three and nine months ended September 30, 2024 and 2023 was as follows (in thousands):
 Three Months Ended September 30,Nine Months Ended September 30,
 2024202320242023
Thrombectomy$204,141 $179,080 $595,346 $486,563 
Embolization and Access96,898 91,866 283,751 287,280 
Total$301,039 $270,946 $879,097 $773,843 
Performance Obligations
Delivery of products - The Company’s contracts with customers, other than the China licensing arrangements described below, typically contain a single performance obligation, delivery of the Company’s products. Satisfaction of that performance obligation occurs when control of the promised goods transfers to the customer, which is generally upon shipment or receipt by customer for non-consignment sale agreements and upon utilization for consignment sale agreements.
Payment terms - The Company’s payment terms vary by the type and location of our customer. The timing between fulfillment of performance obligations and when payment is due is not significant and does not give rise to financing transactions. The Company did not have any contracts with significant financing components as of September 30, 2024 and 2023.
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Penumbra, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
Product returns - The Company may allow customers to return products purchased at the Company’s discretion. The Company estimates the amount of its product sales that may be returned by its customers and records this estimate as a reduction of revenue in the period in which the related product revenue is recognized. The Company currently estimates product return liabilities using its own historic sales information, trends, industry data, and other relevant data points.
Warranties - The Company offers its standard warranty to all customers and it is not available for sale on a standalone basis. The Company’s standard warranty represents its guarantee that its products function as intended, are free from defects, and comply with agreed-upon specifications and quality standards. This assurance does not constitute a service and is not a separate performance obligation.
Transaction Price
Revenue is recorded at the net sales price, which includes estimates of variable consideration such as product returns utilizing historical return rates, rebates, discounts, and other adjustments to net revenue. To the extent the transaction price includes variable consideration, the Company estimates the amount of variable consideration that should be included in the transaction price. When determining if variable consideration should be constrained, management considers whether there are factors that could result in a significant reversal of revenue and the likelihood of a potential reversal. Variable consideration is included in revenue only to the extent that it is probable that a significant reversal of the revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. These estimates are reassessed each reporting period as required. During the three and nine months ended September 30, 2024 and 2023, the Company made no material changes in estimates for variable consideration. When the Company performs shipping and handling activities after control of goods is transferred to the customer, they are considered as fulfillment activities, and costs are accrued for when the related revenue is recognized. Taxes collected from customers relating to product sales and remitted to governmental authorities are excluded from revenues.
Contract assets and liabilities
The following information summarizes the Company’s contract assets and liabilities (in thousands):
September 30, 2024December 31, 2023
Contract assets$18,000 $18,000 
Contract liabilities$545 $6,496 
Contract assets for the periods presented primarily represent the difference between the revenue that was recognized based on the relative standalone selling price of the related performance obligations satisfied and the contractual billing terms in the licensing arrangements.
Contract liabilities represents amounts that the Company has already invoiced and are ultimately expected to be recognized as revenue, but for which not all revenue recognition criteria have been met and is recognized as the associated performance obligations are satisfied. Revenue recognized during the three and nine months ended September 30, 2024 relating to contract liabilities as of June 30, 2024 and December 31, 2023 was $3.1 million and $6.0 million, respectively.
China Distribution and Technology Licensing Agreement
In December 2020, the Company entered into a distribution and technology licensing arrangement with its existing distribution partner in China. In addition to modifying the Company’s standard distribution agreement with its partner in China, the Company agreed to license the technology for certain products to its partner in China to permit the manufacturing and commercialization of such products in China as well as provide certain regulatory support. During the three months ended March 31, 2022, the Company further amended the distribution agreement and entered into an additional license arrangement, pursuant to which the Company agreed to license the technology for additional products to its partner in China on substantially the same terms as the existing license arrangement. Apart from the standard distribution agreement, the Company will receive fixed payments upon transferring its distinct licensed technology and providing related regulatory support. During the three months ended September 30, 2023, the Company entered into an additional licensing arrangement, pursuant to which the Company agreed to license the technology for additional products to its partner in China and will receive fixed payments upon transferring its distinct licensed technology and providing related regulatory support and royalty payments on the down-stream sale of the licensed products. During the three months ended March 31, 2024, the Company entered into another licensing
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Penumbra, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)
agreement, pursuant to which the Company agreed to license the technology for additional products to its partner in China and will receive fixed payments upon transferring its distinct licensed technology and providing related regulatory support.
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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the unaudited condensed consolidated financial statements and the related notes thereto included elsewhere in this Quarterly Report on Form 10-Q and the audited consolidated financial statements and notes thereto and management’s discussion and analysis of financial condition and results of operations for the year ended December 31, 2023, included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on February 22, 2024.
This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). In some cases, you can identify these statements by forward-looking words such as “may,” “will,” “expect,” “believe,” “anticipate,” “intend,” “could,” “should,” “estimate,” or “continue,” and similar expressions or variations, but these words are not the exclusive means for identifying such statements. Such forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results and the timing of certain events to differ materially from future results and timing expressed or implied by such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those identified below, and those discussed in the section titled “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2023. The forward-looking statements in this Quarterly Report on Form 10-Q represent our views as of the date of this Quarterly Report on Form 10-Q. Except as may be required by law, we assume no obligation to update these forward-looking statements or the reasons that results could differ from these forward-looking statements. You should, therefore, not rely on these forward-looking statements as representing our views as of any date subsequent to the date of this Quarterly Report on Form 10-Q.
Overview
References herein to “we,” “us,” “our,” the “Company,” and “Penumbra,” refer to Penumbra, Inc. and its consolidated subsidiaries unless expressly indicated or the context requires otherwise.
Penumbra, the world’s leading thrombectomy company, is focused on developing the most innovative technologies for challenging medical conditions such as ischemic stroke, venous thromboembolism such as pulmonary embolism, and acute limb ischemia. Our broad portfolio, which includes computer assisted vacuum thrombectomy (CAVT), centers on removing blood clots from head-to-toe with speed, safety and simplicity. Our team focuses on developing, manufacturing and marketing novel products for use by specialist physicians and healthcare providers to drive improved clinical and health outcomes. We believe that the cost-effectiveness of our products is attractive to our customers.
Since our founding in 2004, we have invested heavily in our product development and commercial expansion that has established the foundation of our global organization. We have successfully developed, obtained regulatory clearance or approval for, and introduced products into the thrombectomy market since 2007, access market since 2008, embolization market since 2011, and neurosurgical market since 2014, and operated in the immersive healthcare market from 2020 until September 2024.
We expect to continue to develop and build our portfolio of products, including our thrombectomy, embolization and access technologies, while iterating on our currently available products. Generally, when we introduce a next generation product or a new product designed to replace a current product, sales of the earlier generation product or the product replaced decline. Our research and development activities are centered around the development of new products and clinical activities designed to support our regulatory submissions and demonstrate the effectiveness of our products.
During the nine months ended September 30, 2024, we made the strategic decision to explore alternative avenues for our Immersive Healthcare business, and as a result we recorded an impairment charge of $110.3 million related to our Immersive Healthcare asset group. Refer to Note “4. Impairment and Restructuring Costs of Immersive Healthcare Asset Group” to our condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q for more details. During the three months ended September 30, 2024, we permanently ceased sales of our Immersive Healthcare products and related commercial operations.
To address the challenging and significant clinical needs of our key markets, we have developed products that fall into the following broad product families:
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Our thrombectomy products fall into two broad product families:
•Peripheral thrombectomy - INDIGO System, including Lightning, Bolt and CAT RX, designed for continuous or modulated aspiration, computer assisted vacuum thrombectomy, including aspiration catheters, microprocessor-controlled software algorithms that orchestrate the interaction of our pump and catheters, separators, aspiration pump and accessories, including delivery catheters used in peripheral thrombectomy procedures
•Neuro thrombectomy - Penumbra System, including Penumbra RED, JET, ACE, BMX, and MAX catheters and the 3D Revascularization Device, Penumbra ENGINE and other components and accessories
Our embolization and access products fall into four broad product families:
•Peripheral embolization - RUBY Coil System, Ruby LP, LANTERN Delivery Microcatheter and the POD System (POD and POD Packing Coil)
•Neuro embolization - Penumbra SMART COIL, Penumbra Coil 400, POD400, PAC400 and SwiftPAC Coil
•Access - delivery catheters, consisting of Neuron, Neuron MAX Select, BENCHMARK, BMX, DDC, PX SLIM, SENDit and MidWay
•Neurosurgical - Artemis Neuro Evacuation Device
By pioneering these innovations, we support healthcare providers, hospitals and clinics in more than 100 countries, working to improve patient outcomes and quality of life. In the nine months ended September 30, 2024 and 2023, 25.6% and 28.5% of our revenue, respectively, was generated from customers located outside of the United States. Our sales outside of the United States are denominated principally in the euro, with some sales being denominated in other currencies. As a result, we have foreign exchange exposure but do not currently engage in hedging.
We generated revenue of $879.1 million and $773.8 million for the nine months ended September 30, 2024 and 2023, respectively, an increase of $105.3 million. We generated a loss from operations of $33.5 million and income from operations of $38.5 million for the nine months ended September 30, 2024 and 2023, respectively.
Factors Affecting Our Performance
There are a number of factors that have impacted, and we believe will continue to impact, our results of operations and growth. These factors include: 
•The rate at which we grow our salesforce and the speed at which newly hired salespeople become fully effective can impact our revenue growth or our costs incurred in anticipation of such growth.
•Our industry is intensely competitive and, in particular, we compete with a number of large, well-capitalized companies. We must continue to successfully compete in light of our competitors’ existing and future products and their resources to successfully market to the specialist physicians who use our products.
•We must continue to successfully introduce new products that gain acceptance with specialist physicians and other healthcare providers and successfully transition from existing products to new products, ensuring adequate supply. In addition, as we introduce new products and expand our production capacity, we anticipate additional personnel will be hired and trained to build our inventory of components and finished goods in advance of sales, which may cause quarterly fluctuations in our operating results and financial condition.
•Publications of clinical results by us, our competitors and other third parties can have a significant influence on whether, and the degree to which, our products are used by specialist physicians and the procedures and treatments those physicians choose to administer for a given condition.
•The specialist physicians who use our interventional products may not perform procedures during certain times of the year, such as those periods when they are at major medical conferences or are away from their practices for other reasons, the timing of which occurs irregularly during the year and from year to year.
•Most of our sales outside of the United States are denominated in the local currency of the country in which we sell our products. As a result, our revenue from international sales can be significantly impacted by fluctuations in foreign currency exchange rates.
•The availability and levels of reimbursement within the relevant healthcare payment system for healthcare providers for procedures in which our products are used.
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In addition, we have experienced and expect to continue to experience meaningful variability in our quarterly revenue, gross profit and gross margin percentage as a result of a number of factors, including, but not limited to: the number of available selling days, which can be impacted by holidays; the mix of products sold; the geographic mix of where products are sold; the demand for our products and the products of our competitors; the timing of or failure to obtain regulatory approvals or clearances for products; increased competition; the timing of customer orders; inventory or other asset write-offs or write-downs; costs, benefits and timing of new product introductions; costs, benefits and timing of the acquisition and integration of businesses and product lines we may acquire; the availability and cost of components and raw materials; and fluctuations in foreign currency exchange rates. We may experience quarters in which we have significant revenue growth sequentially followed by quarters of moderate or no revenue growth. Additionally, we may experience quarters in which operating expenses, in particular research and development expenses, fluctuate depending on the stage and timing of product development.
Components of Results of Operations
Revenue. We sell our interventional products directly to hospitals and other healthcare providers and through distributors for use in procedures performed by specialist physicians to treat patients in two key markets: thrombectomy and embolization and access. We sell our products through purchase orders, and we do not have long term purchase commitments from our customers. Revenue from product sales is recognized either on the date of shipment or the date of receipt by the customer, but is deferred for certain transactions when control has not yet transferred. With respect to products that we consign to hospitals, which primarily consist of coils, we recognize revenue at the time hospitals utilize products in a procedure. Revenue also includes shipping and handling costs that we charge to customers.
Cost of Revenue. Cost of revenue consists primarily of the cost of raw materials and components, personnel costs, including stock-based compensation, inbound freight charges, receiving costs, inspection and testing costs, warehousing costs, royalty expense, shipping and handling costs, and other labor and overhead costs incurred in the manufacturing of products. We manufacture substantially all of our products in our manufacturing facilities in Alameda and Roseville, California.
Operating Expenses
Research and Development (“R&D”). R&D expenses primarily consist of product development, clinical and regulatory expenses, materials, depreciation and other costs associated with the development of our products. R&D expenses also include salaries, benefits and other related costs, including stock-based compensation, for personnel and consultants. We expense R&D costs as they are incurred.
Sales, General and Administrative (“SG&A”). SG&A expenses primarily consist of salaries, benefits and other related costs, including stock-based compensation, for personnel and consultants engaged in sales, marketing, finance, legal, compliance, administrative, facilities and information technology and human resource activities. Our SG&A expenses also include marketing trials, medical education, training, commissions, generally based on sales, to direct sales representatives, amortization of acquired intangible assets and acquisition-related costs.
Income Taxes
We are taxed at the rates applicable within each jurisdiction in which we operate. The composite income tax rate, tax provisions, deferred tax assets (“DTAs”) and deferred tax liabilities will vary according to the jurisdiction in which profits arise. Tax laws are complex and subject to different interpretations by management and the respective governmental taxing authorities, and require us to exercise judgment in determining our income tax provision, our deferred tax assets and deferred tax liabilities and the potential valuation allowance recorded against our net DTAs. Deferred tax assets and liabilities are determined using the enacted tax rates in effect for the years in which those tax assets are expected to be realized. A valuation allowance is established when it is more likely than not that the future realization of all or some of the DTAs will not be achieved.
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Results of Operations
The following table sets forth the components of our condensed consolidated statements of operations in dollars and as a percentage of revenue for the periods presented:
 Three Months Ended September 30,Nine Months Ended September 30,
 2024202320242023
 (in thousands, except for percentages)(in thousands, except for percentages)
Revenue$301,039 100.0 %$270,946 100.0 %$879,097 100.0 %$773,843 100.0 %
Cost of revenue100,733 33.5 93,228 34.4 334,823 38.1 278,192 35.9 
Gross profit200,306 66.5 177,718 65.6 544,274 61.9 495,651 64.1 
Operating expenses:
Research and development25,205 8.4 20,958 7.7 74,773 8.5 62,481 8.1 
Sales, general and administrative139,737 46.4 125,920 46.5 426,052 48.5 376,433 48.6 
Acquired in-process research and development— — 18,215 6.7 — — 18,215 2.4 
Impairment charge— — — — 76,945 8.8 — — 
Total operating expenses164,942 54.8 165,093 60.9 577,770 65.8 457,129 59.1 
Income (loss) from operations35,364 11.7 12,625 4.7 (33,496)(3.8)38,522 5.0 
Interest and other income, net4,414 1.5 679 0.2 10,026 1.1 2,970 0.4 
Income (loss) before income taxes39,778 13.2 13,304 4.9 (23,470)(2.7)41,492 5.4 
Provision for (benefit from) income taxes10,251 3.4 4,090 1.5 (3,799)(0.4)4,756 0.6 
Net income (loss)$29,527 9.8 %$9,214 3.4 %$(19,671)(2.3)%$36,736 4.7 %

Three Months Ended September 30, 2024 Compared to the Three Months Ended September 30, 2023
Certain changes in presentation were made to the Company’s revenues disaggregated by product categories for the period ended September 30, 2023 to conform to the presentation for the period ended September 30, 2024. During the year ended December 31, 2023, the Company made changes to its product categories to provide investors with more meaningful information to understand the performance of its business and strategic direction.
Revenue
 Three Months Ended September 30,Change
 20242023$%
 (in thousands, except for percentages)
Thrombectomy$204,141 $179,080 $25,061 14.0 %
Embolization and Access96,898 91,866 5,032 5.5 %
Total$301,039 $270,946 $30,093 11.1 %
Revenue increased $30.1 million, or 11.1%, to $301.0 million in the three months ended September 30, 2024, from $270.9 million in the three months ended September 30, 2023. Overall revenue growth was primarily due to an increase in sales of our existing thrombectomy products.
Revenue from our global thrombectomy products increased $25.1 million, or 14.0%, to $204.1 million in the three months ended September 30, 2024, from $179.1 million in the three months ended September 30, 2023. The increase in our global thrombectomy products was primarily attributable to higher sales volume in the United States as a result of further market penetration of our existing products. Sales of our U.S. thrombectomy products increased by 21.2% in the three months ended September 30, 2024. Prices for our thrombectomy products remained substantially unchanged during the period.
Revenue from our global embolization and access products increased $5.0 million, or 5.5%, to $96.9 million in the three months ended September 30, 2024, from $91.9 million in the three months ended September 30, 2023. The increase in our global embolization and access products was primarily driven by sales of our U.S. embolization and access products, which increased by 5.3% in the three months ended September 30, 2024. Prices for our embolization and access products remained substantially unchanged during the period.
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Revenue by Geographic Area
The following table presents revenue by geographic area, based on our customers’ shipping destinations, for the three months ended September 30, 2024 and 2023:
Three Months Ended September 30,Change
20242023$%
 (in thousands, except for percentages)
United States$226,326 75.2 %$194,816 71.9 %$31,510 16.2 %
International74,713 24.8 %76,130 28.1 %(1,417)(1.9)%
Total$301,039 100.0 %$270,946 100.0 %$30,093 11.1 %
Revenue from product sales in international markets decreased $1.4 million, or 1.9%, to $74.7 million in the three months ended September 30, 2024, from $76.1 million in the three months ended September 30, 2023. Revenue from international sales represented 24.8% and 28.1% of our total revenue for the three months ended September 30, 2024 and 2023, respectively.
Gross Margin
 Three Months Ended September 30,Change
 20242023$%
 (in thousands, except for percentages)
Cost of revenue$100,733 $93,228 $7,505 8.1 %
Gross profit$200,306 $177,718 $22,588 12.7 %
Gross margin %66.5 %65.6 %
Gross margin increased by 0.9 percentage points to 66.5% in the three months ended September 30, 2024, from 65.6% in the three months ended September 30, 2023. Gross margin is impacted by product mix, regional mix, and production initiatives to support demand and create future efficiencies. As such, with favorable product mix, improvement in productivity, and by leveraging our fixed costs on higher volume of new product sales during the year, our gross margin may be positively impacted in the future. Our manufacturing team will focus on ramping up our volume, while driving our productivity and efficiency for our new product launches expected in the fourth quarter.
Research and Development (“R&D”)
 Three Months Ended September 30,Change
 20242023$%
 (in thousands, except for percentages)
R&D$25,205 $20,958 $4,247 20.3 %
R&D as a percentage of revenue8.4 %7.7 %
R&D expenses increased by $4.2 million, or 20.3%, to $25.2 million in the three months ended September 30, 2024, from $21.0 million in the three months ended September 30, 2023. The increase was primarily due to $2.6 million of one-time expenses in connection with the wind down of the Immersive Healthcare business and a $0.8 million increase in personnel-related expenses.
As a result of the wind down of the Immersive Healthcare business, we expect to create R&D expense savings of approximately $17.0 million per year moving forward. We have continued to make investments, and plan to continue to make investments, in the development of our products. As part of our ongoing investment in the development of our products, we may incur additional expenses related to research and development milestones. In addition, we have experienced in the past, and may continue to experience in the future, variability in expenses incurred due to the timing and costs of clinical trials and product development, which may include additional personnel-related expenses in conjunction with the launch of new products.
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Sales, General and Administrative (“SG&A”)
 Three Months Ended September 30,Change
 20242023$%
 (in thousands, except for percentages)
SG&A$139,737 $125,920 $13,817 11.0 %
SG&A as a percentage of revenue46.4 %46.5 %
SG&A expenses increased by $13.8 million, or 11.0%, to $139.7 million in the three months ended September 30, 2024, from $125.9 million in the three months ended September 30, 2023. The increase was primarily due to a $6.9 million increase in personnel-related expenses driven by an increase in headcount and related expenses to support our growth, $2.3 million of one-time expenses in connection with the wind down of the Immersive Healthcare business, a $2.1 million increase in other professional services, and a $1.9 million increase in costs related to marketing events. This was partially offset by a $2.4 million decrease in amortization expense of finite lived intangible assets acquired in connection with the Sixense acquisition due to the impairment of long-lived assets associated with the Immersive Healthcare business in the second quarter of 2024.
As a result of the wind down of the Immersive Healthcare business, we expect to create SG&A expense savings of approximately $23.0 million per year moving forward. As we continue to invest in our growth, we have expanded and may continue to expand our sales, marketing, and general and administrative teams through the hiring of additional employees in critical roles that support our strategic initiatives. In addition, we have experienced in the past, and may continue to experience in the future, variability in expenses incurred due to the timing and costs of investments to support the business.
Acquired In-Process Research and Development
 Three Months Ended September 30,Change
 20242023$%
 (in thousands, except for percentages)
Acquired in-process research and development$— $18,215 $(18,215)not meaningful
Acquired in-process research and development as a percentage of revenue— %6.7 %
There were no acquired IPR&D charges during the three months ended September 30, 2024. During the third quarter of the prior year, we recorded an $18.2 million acquired IPR&D charge in connection with an asset acquisition. Refer to Note “6. Asset Acquisition” to our condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q for more details.
Provision for income taxes
 Three Months Ended September 30,Change
 20242023$%
 (in thousands, except for percentages)
Provision for income taxes$10,251 $4,090 $6,161 150.6 %
Effective tax rate25.8 %30.7 %
Our provision for income taxes was $10.3 million for the three months ended September 30, 2024, which was primarily due to tax expenses attributable to our worldwide profits. Our provision for income taxes was $4.1 million for the three months ended September 30, 2023, which was primarily due to tax expenses attributable to our worldwide profits and a discrete tax charge resulting from the non-deductible IPR&D charge associated with an asset acquisition, offset by excess tax benefits from stock-based compensation attributable to our U.S. jurisdiction.
Our effective tax rate decreased to 25.8% for the three months ended September 30, 2024, from 30.7% for the three months ended September 30, 2023, primarily due to tax expense associated with the non-deductible acquired in-process research and development expenses in 2023.
Prospectively, our effective tax rate will likely be driven by (1) permanent differences in taxable income for tax and financial reporting purposes, (2) tax expense or benefit attributable to our worldwide financial result, and (3) discrete tax adjustments such as excess tax benefits or deficiencies related to stock-based compensation. Our income tax provision is subject to volatility as the amount of excess tax benefits or deficiencies can fluctuate from period to period based on the price of our stock, the volume of share-based grants settled or vested, and the fair value assigned to equity awards under U.S. GAAP. In
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addition, changes in tax law or our interpretation thereof, and changes to our valuation allowance could result in fluctuations in our effective tax rate.
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Nine Months Ended September 30, 2024 Compared to the Nine Months Ended September 30, 2023
Revenue
 Nine Months Ended September 30,Change
 20242023$%
 (in thousands, except for percentages)
Thrombectomy$595,346 $486,563 $108,783 22.4 %
Embolization and Access283,751 287,280 (3,529)(1.2)%
Total$879,097 $773,843 $105,254 13.6 %
Revenue increased $105.3 million, or 13.6%, to $879.1 million in the nine months ended September 30, 2024, from $773.8 million in the nine months ended September 30, 2023. Overall revenue growth was primarily due to an increase in sales of our new and existing thrombectomy products.
Revenue from our global thrombectomy products increased $108.8 million, or 22.4%, to $595.3 million in the nine months ended September 30, 2024, from $486.6 million in the nine months ended September 30, 2023. The increase in our global thrombectomy products was primarily attributable to higher sales volume in the United States as a result of further market penetration of our existing products. Sales of our U.S. thrombectomy products increased by 26.6% in the nine months ended September 30, 2024. Prices for our thrombectomy products remained substantially unchanged during the period.
Revenue from our global embolization and access products decreased $3.5 million, or 1.2%, to $283.8 million in the nine months ended September 30, 2024, from $287.3 million in the nine months ended September 30, 2023. The decrease in our global embolization and access products was primarily driven by our international embolization and access products, which decreased by 6.0% in the nine months ended September 30, 2024, partially offset by a 1.4% increase in sales of our U.S. embolization and access products. Prices for our embolization and access products remained substantially unchanged during the period.
Revenue by Geographic Area
The following table presents revenue by geographic area, based on our customer’s shipping destination, for the nine months ended September 30, 2024 and 2023:
 Nine Months Ended September 30,Change
20242023$%
 (in thousands, except for percentages)
United States$654,150 74.4 %$553,467 71.5 %$100,683 18.2 %
International224,947 25.6 %220,376 28.5 %4,571 2.1 %
Total$879,097 100.0 %$773,843 100.0 %$105,254 13.6 %
Revenue from sales in international markets increased $4.6 million, or 2.1%, to $224.9 million in the nine months ended September 30, 2024, from $220.4 million in the nine months ended September 30, 2023. Revenue from international sales represented 25.6% and 28.5% of our total revenue for the nine months ended September 30, 2024 and 2023, respectively.
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Gross Margin
 Nine Months Ended September 30,Change
 20242023$%
 (in thousands, except for percentages)
Cost of revenue$334,823 $278,192 $56,631 20.4 %
Gross profit$544,274 $495,651 $48,623 9.8 %
Gross margin %61.9 %64.1 %
Gross margin was 61.9% in the nine months ended September 30, 2024, including a one-time $33.4 million inventory impairment charge to cost of revenue in connection with the impairment of our Immersive Healthcare asset group (refer to Note “4. Impairment and Restructuring Costs of Immersive Healthcare Asset Group” to our condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q for more details), which compares to 64.1% in the nine months ended September 30, 2023. The impact of the one-time $33.4 million charge decreased our gross margin by 3.8 percentage points in the nine months ended September 30, 2024. Gross margin is impacted by product mix, regional mix, and production initiatives to support demand and create future efficiencies. As such, with favorable product mix, improvement in productivity, and by leveraging our fixed costs on higher volume of new product sales during the year, our gross margin may be positively impacted in the future. Our manufacturing team will focus on ramping up our volume, while driving our productivity and efficiency for our new product launches expected in the fourth quarter.
Research and Development (“R&D”)
 Nine Months Ended September 30,Change
 20242023$%
 (in thousands, except for percentages)
R&D$74,773 $62,481 $12,292 19.7 %
R&D as a percentage of revenue8.5 %8.1 %
R&D expenses increased by $12.3 million, or 19.7%, to $74.8 million in the nine months ended September 30, 2024, from $62.5 million in the nine months ended September 30, 2023. The increase was primarily due to a $4.0 million increase in personnel-related expenses, a $2.9 million increase in product development and testing costs, and $2.6 million in one-time expenses in connection with the wind down of the Immersive Healthcare business.
As a result of the wind down of the Immersive Healthcare business, we expect to create R&D expense savings of approximately $17.0 million per year moving forward. We have continued to make investments, and plan to continue to make investments, in the development of our products. As part of our ongoing investment in the development of our products, we may incur additional expenses related to research and development milestones. In addition, we have experienced in the past, and may continue to experience in the future, variability in expenses incurred due to the timing and costs of clinical trials and product development, which may include additional personnel-related expenses in conjunction with the launch of new products.

Sales, General and Administrative (SG&A)
 Nine Months Ended September 30,Change
 20242023$%
 (in thousands, except for percentages)
SG&A$426,052 $376,433 $49,619 13.2 %
SG&A as a percentage of revenue
48.5 %48.6 %
SG&A expenses increased by $49.6 million, or 13.2%, to $426.1 million in the nine months ended September 30, 2024, from $376.4 million in the nine months ended September 30, 2023. The increase was primarily due to a $20.6 million increase in personnel-related expense driven by an increase in headcount and related expenses to support our growth, a $8.0 million increase in costs related to marketing events, and a $7.6 million increase in other professional services.
As a result of the wind down of the Immersive Healthcare business, we expect to create SG&A expense savings of approximately $23.0 million per year moving forward. As we continue to invest in our growth, we have expanded and may continue to expand our sales, marketing, and general and administrative teams through the hiring of additional employees in critical roles that support our strategic initiatives. In addition, we have experienced in the past, and may continue to experience in the future, variability in expenses incurred due to the timing and costs of investments to support the business.
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Acquired In-Process Research and Development
 Nine Months Ended September 30,Change
 20242023$%
 (in thousands, except for percentages)
Acquired in-process research and development$— $18,215 $(18,215)not meaningful
Acquired in-process research and development as a percentage of revenue— %2.4 %
There were no acquired IPR&D charges during the nine months ended September 30, 2024. During the third quarter of the prior year, we recorded an $18.2 million acquired IPR&D charge in connection with an asset acquisition. Refer to Note “6. Asset Acquisition” to our condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q for more details.
Impairment Charge
 Nine Months Ended September 30,Change
 20242023$%
 (in thousands, except for percentages)
Impairment Charge$76,945 $— $76,945 100.0 %
Impairment Charge as a percentage of revenue8.8 %— %
During the nine months ended September 30, 2024, we recorded a $76.9 million impairment charge which was comprised of $58.9 million in finite lived intangible assets and $18.0 million in property and equipment, respectively, in connection with the impairment of our Immersive Healthcare asset group. See Note “4. Impairment and Restructuring Costs of Immersive Healthcare Asset Group” to our condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q for more information.
(Benefit from) provision for income taxes
 Nine Months Ended September 30,Change
 20242023$%
 (in thousands, except for percentages)
(Benefit from) provision for income taxes$(3,799)$4,756 $(8,555)(179.9)%
Effective tax rate16.2 %11.5 %
Our benefit from income taxes was $3.8 million for the nine months ended September 30, 2024, which was primarily due to a discrete tax benefit attributable to the impairment charge related to our Immersive Healthcare asset group, partially offset by tax expenses attributable to our worldwide profits. Our provision for income taxes was $4.8 million for the nine months ended September 30, 2023, which was primarily due to tax expenses attributable to our worldwide profits and a discrete tax charge resulting from the non-deductible IPR&D charge associated with an asset acquisition, offset by excess tax benefits from stock-based compensation attributable to our U.S. jurisdiction.
Our effective tax rate increased to 16.2% for the nine months ended September 30, 2024 from 11.5% for the nine months ended September 30, 2023, primarily due to decrease in excess tax benefits from stock-based compensation attributable to our U.S. jurisdiction in 2024.
Prospectively, our effective tax rate will likely be driven by (1) permanent differences in taxable income for tax and financial reporting purposes, (2) tax expense or benefit attributable to our worldwide financial results, and (3) discrete tax adjustments such as excess tax benefits or deficiencies related to stock-based compensation. Our income tax provision can be volatile as the amount of excess tax benefits or deficiencies can fluctuate from period to period due to the price of our stock, the volume of share-based grants exercised or vested, and the fair value assigned to equity awards under U.S. GAAP. In addition, changes in tax law or our interpretation thereof, and changes to our valuation allowance could result in fluctuations in our effective tax rate.
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Liquidity and Capital Resources
As of September 30, 2024, we had $738.6 million in working capital, which included $280.5 million in cash and cash equivalents and $10.5 million in marketable investments. As of September 30, 2024, we held approximately 8.8% of our cash and cash equivalents in foreign entities.
We believe our current sources of liquidity will be sufficient to meet our liquidity requirements for at least the next 12 months. Our principal liquidity requirements are to fund our operations, expand manufacturing operations which includes, but is not limited to, maintaining sufficient levels of inventory to meet the anticipated demand of our customers, fund research and development activities and fund our capital expenditures. We may also lease or purchase additional facilities to facilitate our growth. We expect to continue to make investments as we launch new products, expand our manufacturing operations and information technology infrastructures and further expand into international markets. We may, however, require or elect to secure additional financing as we continue to execute our business strategy. If we require or elect to raise additional funds, we may do so through equity or debt financing, which may not be available on favorable terms, could result in dilution to our stockholders, and could require us to agree to covenants that limit our operating flexibility.
Share Repurchase Program
On August 5, 2024, the Company’s Board of Directors approved a share repurchase authorization in the amount of up to $200.0 million, allowing the Company to repurchase its common stock from time to time at such prices as it deems appropriate through open market purchases, block transactions, privately negotiated transactions, including accelerated share repurchase transactions, or otherwise. The repurchase authorization expires on July 31, 2025. Under this authorization, the Company entered into an accelerated share repurchase agreement (“ASR”) with JPMorgan Chase Bank, National Association to repurchase $100.0 million of the Company’s common stock during the three months ended September 30, 2024. During the three months ended September 30, 2024, the Company repurchased an aggregate of 517,763 shares under the ASR at an aggregate cost of $100.4 million, including legal and financial advisor fees of $0.4 million associated with the repurchase. As of September 30, 2024, the Company had remaining authority to purchase $100.0 million of its common stock under the share repurchase authorization. See Note “11. Share Repurchase Program” to the condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q and “Issuer Purchases of Equity Securities” in Part II, Item 2 of this Quarterly Report on Form 10-Q for more information.
The following table summarizes our cash and cash equivalents, marketable investments and selected working capital data as of September 30, 2024 and December 31, 2023:
 September 30, 2024December 31, 2023
 (in thousands)
Cash and cash equivalents$280,476 $167,486 
Marketable investments10,548 121,701 
Accounts receivable, net176,051 201,768 
Accounts payable33,151 27,155 
Accrued liabilities105,550 110,555 
Working capital(1)
738,568 764,258 
(1)Working capital consists of total current assets less total current liabilities.
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The following table sets forth, for the periods indicated, our beginning balance of cash and cash equivalents, net cash flows provided by (used in) operating, investing and financing activities and our ending balance of cash and cash equivalents:
 Nine Months Ended September 30,
 20242023
 (in thousands)
Cash and cash equivalents at beginning of period$167,486 $69,858 
Net cash provided by operating activities117,373 61,072 
Net cash provided by (used in) investing activities88,579 (40,356)
Net cash (used in) provided by financing activities(93,074)10,282 
Cash and cash equivalents and at end of period280,476 100,757 
Net Cash Provided By Operating Activities
Net cash provided by operating activities consists primarily of net income adjusted for certain non-cash items (including depreciation and amortization, stock-based compensation expense, acquired in-process research and development, impairment charge, inventory write-offs and write-downs, changes in deferred tax balances, and the effect of changes in working capital and other activities).
Net cash provided by operating activities was $117.4 million during the nine months ended September 30, 2024 and consisted of consolidated net loss of $19.7 million and non-cash items of $151.7 million, offset by net changes in operating assets and liabilities of $14.7 million. The change in operating assets and liabilities primarily relates to an increase in inventories of $46.0 million to support our growth and an increase in accounts payable of $6.0 million, due to timing of payments. This was partially offset by a decrease in accounts receivable of $23.4 million due to timing of invoicing and collections, a decrease in prepaid expenses and other current and non-current assets of $1.7 million, and a decrease in accrued expenses and other non-current liabilities of $0.2 million due to timing of payments.
Net cash provided by operating activities was $61.1 million during the nine months ended September 30, 2023 and consisted of consolidated net income of $36.7 million and non-cash items of $86.0 million, offset by net changes in operating assets and liabilities of $61.7 million. The change in operating assets and liabilities primarily relates to an increase in inventories of $46.5 million to support our growth, an increase in accounts receivable of $6.6 million due to timing of invoicing and collections, and an increase in prepaid expenses and other current and non-current assets of $10.3 million. This was partially offset by an increase in accounts payable of $2.1 million due to timing of payments.
Net Cash Provided By (Used In) Investing Activities
Net cash provided by (used in) investing activities relates primarily to purchases of marketable and non-marketable investments, capital expenditures and payments in connection with asset acquisitions, partially offset by proceeds from maturities of marketable investments.
Net cash provided by investing activities was $88.6 million during the nine months ended September 30, 2024 and primarily consisted of $112.8 million in proceeds from maturities of marketable investments, net of purchases, partially offset by purchases of capital expenditures of $15.8 million and non-marketable investments of $10.0 million.
Net cash used in investing activities was $40.4 million during the nine months ended September 30, 2023 and primarily consisted of $27.3 million in purchases of marketable investments, net of proceeds from maturities, capital expenditures of $11.6 million and $1.0 million in payments in connection with an asset acquisition.
Net Cash (Used In) Provided By Financing Activities
Net cash (used in) provided by financing activities primarily relates to repurchases of our common stock and payments towards the reduction of our finance lease obligations, partially offset by proceeds from exercises of stock options and issuances of common stock under our employee stock purchase plan.
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Net cash used in financing activities was $93.1 million during the nine months ended September 30, 2024 and primarily consisted of repurchases of common stock of $100.4 million, including legal and financial advisor fees, and $1.7 million in payments towards finance leases, partially offset by proceeds from the issuance of common stock under our employee stock purchase plan of $8.9 million.
Net cash provided by financing activities was $10.3 million during the nine months ended September 30, 2023 and primarily consisted of proceeds from the issuance of common stock under our employee stock purchase plan of $8.4 million and proceeds from exercises of stock options of $4.7 million, partially offset by $1.5 million in payments towards finance leases and $1.1 million of payments of employee taxes related to vested restricted stock units.
Contractual Obligations and Commitments
There have been no other material changes to our contractual obligations and commitments as of September 30, 2024 from those disclosed in our Annual Report on Form 10-K for the year ended December 31, 2023.
Critical Accounting Policies and Estimates
We have prepared our financial statements in accordance with U.S. GAAP. Our preparation of these financial statements requires us to make estimates, assumptions, and judgments that affect the reported amounts of assets, liabilities, expenses, and related disclosures at the date of the financial statements, as well as revenue and expenses recorded during the reporting periods. We evaluate our estimates and judgments on an ongoing basis. We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results could therefore differ materially from these estimates under different assumptions or conditions.
There have been no material changes to our critical accounting policies from those described in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K for the year ended December 31, 2023.
Recently Issued Accounting Standards
For information with respect to recently issued accounting standards and the impact of these standards on our consolidated financial statements, refer to Note “2. Summary of Significant Accounting Policies” to our condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q.
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
We are exposed to various market risks, which may result in potential losses arising from adverse changes in market rates, such as interest rates and foreign exchange rates. We do not enter into derivatives or other financial instruments for trading or speculative purposes and do not believe we are exposed to material market risk with respect to our cash and cash equivalents and/or our marketable investments.
Interest Rate Risk. We had cash and cash equivalents of $280.5 million as of September 30, 2024, which consisted of funds held in money market funds, U.S. treasury securities, and general checking and savings accounts. In addition, we had marketable investments of $10.5 million, which consisted primarily of U.S. treasury securities and commercial paper. Our investment policy is focused on the preservation of capital and supporting our liquidity needs. Under the policy, we invest in highly rated securities, while limiting the amount of credit exposure to any one issuer other than the U.S. government. We do not invest in financial instruments for trading or speculative purposes, nor do we use leveraged financial instruments. We utilize external investment managers who adhere to the guidelines of our investment policy. A hypothetical 100 basis point change in interest rates would not have a material impact on the value of our cash and cash equivalents or marketable investments.
Foreign Exchange Risk Management. We operate in countries other than the United States, and, therefore, we are exposed to foreign currency risks. We bill most sales outside of the United States in local currencies, primarily in euros, with some sales being denominated in other currencies. When sales or expenses are not denominated in U.S. dollars, a fluctuation in exchange rates could affect our net income. We do not believe our net income would be materially impacted by an immediate 10% adverse change in foreign exchange rates. We do not currently hedge our exposure to foreign currency exchange rate fluctuations; however, we may choose to hedge our exposure in the future.
While our gross margin for the nine months ended September 30, 2024 was primarily impacted by product mix, regional mix, and production initiatives to support demand and create future efficiencies, changes in prices did not have a significant impact on our results of operations for any periods presented on our consolidated financial statements.

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ITEM 4. CONTROLS AND PROCEDURES.
Evaluation of Disclosure Controls and Procedures
An evaluation as of September 30, 2024 was carried out under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of our “disclosure controls and procedures,” which are defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as controls and other procedures of a company that are designed to ensure that the information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the company’s management, including its principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. Based upon that evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective as of September 30, 2024.
Changes in Internal Control Over Financial Reporting
There was no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the quarterly period ended September 30, 2024 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
Limitations on the Effectiveness of Controls
A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Because of inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, if any, within a company have been detected. Accordingly, our disclosure controls and procedures are designed to provide reasonable, not absolute, assurance that the objectives of our disclosure control system are met.
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PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.
For information with respect to Legal Proceedings, see Note “9. Commitments and Contingencies” to our condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q.

ITEM 1A. RISK FACTORS.
There have been no material changes to our risk factors reported in, or new risk factors identified since the filing of, our Annual Report on Form 10-K for the year ended December 31, 2023, which was filed with the SEC on February 22, 2024.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.
Issuer Purchases of Equity Securities
The following table summarizes the Company’s share repurchase activity for the three months ended September 30, 2024:
PeriodTotal Number of Shares PurchasedAverage Price paid per ShareTotal Number of Shares Purchased as Part of Publicly Announced Plans or Programs
Maximum Number (or Approximate Dollar Value) of Shares that May Yet be Purchased Under the Plans or Programs (in millions)(1)(2)
July 1, 2024 - July 31, 2024—$— —$— 
August 1, 2024 - August 31, 2024473,962$193.14 473,962$108.5 
September 1, 2024 - September 30, 202443,801$193.14 43,801$100.0 
Total517,763517,763
(1)On August 13, 2024, the Company announced that on August 5, 2024, the Board of Directors approved a share repurchase authorization in the amount of up to $200.0 million, allowing the Company to repurchase its common stock from time to time at such prices as it deems appropriate through open market purchases, block transactions, privately negotiated transactions, including accelerated share repurchase transactions, or otherwise. The repurchase authorization expires on July 31, 2025.

(2)On August 12, 2024, the Company entered into an accelerated share repurchase agreement (“ASR”) with JPMorgan Chase Bank, National Association to repurchase $100.0 million of the Company’s common stock. During the three months ended September 30, 2024, the Company repurchased an aggregate of 517,763 shares under the ASR at an aggregate cost of $100.4 million, including legal and financial advisor fees of $0.4 million associated with the repurchase. As of September 30, 2024, the Company had remaining authority to purchase$100.0 million of its common stock under the share repurchase authorization. See Note “11. Share Repurchase Program” to our condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q for more information.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
None.

ITEM 4. MINE SAFETY DISCLOSURE.
None.

ITEM 5. OTHER INFORMATION.
Rule 10b5-1 Trading Plans
During the quarterly period ended September 30, 2024, certain of our directors and officers adopted trading plans, each of which is intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act (the “Rule 10b5-1 Trading Arrangements”). Each Rule 10b5-1 Trading Arrangement was entered into during an open trading window under our Securities Trading Policy. The following table presents the material terms of each Rule 10b5-1 Trading Arrangement adopted by our officers and directors during the three months ended September 30, 2024, other than terms with respect to the price at which the individual executing the Rule 10b5-1 Trading Arrangement is authorized to trade:
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Name and Title of Officer or DirectorPlan ActionPlan Action DatePlan DurationTotal Securities to be Sold
Lambert Shiu, Chief Accounting Officer
Adoption8/29/2024
11/29/2024 - 12/31/2024
2,452
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ITEM 6. EXHIBITS.
Exhibit NumberDescriptionFormFile No.Exhibit(s)Filing Date
Certification of Principal Executive Officer Required Under Rule 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as amended.
Certification of Principal Financial Officer Required Under Rule 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as amended.
Certification of Principal Executive Officer and Principal Financial Officer Required Under Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended, and 18 U.S.C. §1350.
101The following materials from the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2024 formatted in Inline Extensible Business Reporting Language (iXBRL) includes: (i) Condensed Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023, (ii) Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2024 and 2023, (ii) Condensed Consolidated Statements of Comprehensive Income (Loss) for the three and nine months ended September 30, 2024 and 2023, (iii) Condensed Consolidated Statements of Stockholders’ Equity for the three and nine months ended September 30, 2024 and 2023, (iv) Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2024 and 2023, and (v) Notes to Condensed Consolidated Financial Statements.
104Cover Page Interactive Data File (formatted as iXBRL with applicable taxonomy extension information contained in Exhibit 101).
* Furnished herewith.
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SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 PENUMBRA, INC.
Date: October 30, 2024 
 By: /s/ Maggie Yuen
 Maggie Yuen
 Chief Financial Officer
(Principal Financial Officer)

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