Earnings Call Transcript - COO Q3 2021

Operator, Operator

Thank you for standing by, and welcome to the Third Quarter 2021 Cooper Companies Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. As a reminder, today's program is being recorded. I'd now like to introduce your host for today's program, Kim Duncan, Vice President, Investor Relations and Risk Management. Please go ahead.

Kim Duncan, Vice President, Investor Relations and Risk Management

Good afternoon, and welcome to the Cooper Companies third quarter 2021 earnings conference call. During today's call, we will discuss the results and guidance included in the earnings release and then use the remaining time for Q&A. Our presenters on today's call are Al White, President and Chief Executive Officer; and Brian Andrews, Chief Financial Officer and Treasurer. Before we begin, I'd like to remind you that this conference call contains forward-looking statements, including all revenue and earnings per share guidance and other statements regarding anticipated results of operations, market or regulatory conditions and integration of any acquisitions or their failure to achieve anticipated benefits. Forward-looking statements depend on assumptions, data or methods that may be incorrect or imprecise and are subject to risks and uncertainties. Events that could cause our actual results and future actions of the company to differ materially from those described in forward-looking statements are set forth under the caption forward-looking statements in today's earnings release and are described in our SEC filings, including Cooper's 10-K and Form 10-Q filings, all of which are available on our website at coopercos.com. Should you have any additional questions following the call, please call our investor line at 925-460-3663 or e-mail ir@cooperco.com. And now, I'll turn the call over to Al for his opening remarks.

Al White, President and Chief Executive Officer

Thank you, Kim, and welcome everyone to Cooper Companies fiscal third quarter conference call and pleased to report another very strong quarter with record revenues at CooperVision and CooperSurgical driving record earnings and robust free cash flow. CooperVision's growth was broad based and led by our daily silicone hydrogel portfolio of lenses and a solid rebound in EMEA. While our myopia management products also performed really well. And of course, we received the exciting news about regulatory approvals for MiSight in China. CooperSurgical continued posting great results led by fertility and a nice bump in PARAGARD, helped by buying activity from a price increase. Moving forward, we expect core operational strength to continue driving strong performance even with challenges from COVID and currency. With this expectation and the opportunities we're seeing in myopia management, daily silicones and fertility, we've increased our constant currency revenue guidance for both CooperVision and CooperSurgical and we'll maintain our investment activity to capitalize on the potential for incremental share gains as we move towards fiscal 2022. Moving to third quarter results and reporting all percentages on a constant currency basis, consolidated revenues were 763 million with CooperVision at 558 million up 20% and CooperSurgical at 206 million up 58%. Non-GAAP earnings per share were $3.41. For CooperVision, our daily silicone hydrogel portfolio led the way with all three regions posting strong growth, particular strength was noted in our daily toric franchises, the daily spheres and multifocal also performed well. And in a great sign, we've seen a nice uptick in Fits Data for MyDay and clariti, which bodes well for share gains and future growth. Within the regions, the Americas grew 16% led by MyDay and clariti and continued improvement in patient flow. EMEA grew a healthy 24% as consumer activity returned in the region and we took share. We're number one in EMEA and we're seeing the benefits of increasing patient flow. So we'll continue investing to support the reopening activity happening in many of the European markets. Asia Pac grew 18% led by a slow but steady improvement in consumer activity. For us a significant portion of Asia Pac is driven by Japan. And although consumer activity remains somewhat muted, we're performing well and taking share and we're well positioned to capitalize on future opportunities given our recent product launches. Moving to category details, silicone hydrogel dailies grew 31% with MyDay and clariti both performing well. MyDay in particular continues taking share lead by strength in MyDay toric in all regions. For our FRP portfolio, Biofinity continued its solid performance led by Biofinity Energys and Biofinity toric multifocal. Regarding product expansions and launches, we remain very active. We're finishing the launch of clariti Sphere and the MyDay second base curve sphere in Japan. We're rolling out Biofinity toric multifocal in additional markets. We're rolling out an expanded torque range for MyDay giving it the broadest range of any daily toric in the world. And we're also completing the rollouts of extended toric ranges for clariti and Biofinity. We've also started pre-launch activity for MyDay multifocal with the full launch on target for the U.S. and other select markets in November. Feedback on this lens remains extremely positive, including from fitters, commenting that our OptiExpert fitting app has the highest fit success rate of any multifocal on the market. Recent data shows that over 90% of contact lens wearers over the age of 40 expect to continue wearing lenses, with the biggest challenge being finding a good multifocal. Given the feedback we've been receiving, we believe MyDay will be the best multifocal on the market. And combined with the fact that joining an already highly successful MyDay sphere and toric, we're very optimistic about its success. Moving to myopia management, our portfolio grew a robust 90% this quarter to 18 million, with MiSight up 187% to 5 million, and Ortho-K products up 68%. As a global leader in the myopia management space, our portfolio is the broadest in the industry comprised of MiSight, the only FDA approved myopia control product, our broad range of market leading Ortho-K lenses and our innovative SightGlass Vision glasses. We continue targeting 65 million in myopia management sales this year, including MiSight reaching 20 million. Regarding MiSight, there was a lot of positive activity this quarter as we continue capitalizing on our first mover advantage. We received regulatory approval in China and we're extremely excited about that opportunity. The approval requires lenses to be manufactured post approval, so we could quickly initiate production and packaging and plant a seed in the market starting in early fiscal Q1 with a full launch in fiscal Q2 of next year. As part of this, we're immediately ramping up marketing efforts and working quickly to ensure the product is positioned for success. Myopia rates are very high in China, so the market potential is significant. As an example, it's estimated that over 80% of high school kids are myopic. So treating children at a younger age is of high importance in the country. Outside of China, we continue making great progress with our large retailers and buying groups. Our pilot programs are live and expanding. And we finally have been able to resume in-person training in many markets, including in the U.S. We now have over 40,000 children wearing MiSight worldwide and that number is growing quickly. Additionally, the average age of a new MiSight wearer remains 11, so this treatment is bringing children into contact lenses at a much younger age. Lastly, on MiSight, we did see momentum pick up even more in August, including here in the U.S. So we're bullish for a strong Q4. Regarding our other myopia management products, we had a solid quarter for Ortho-K driven by our broad product portfolio and from the halo effect we're seeing with MiSight. And we continue making progress with our SightGlass myopia management glasses, preparing for several upcoming launches later this calendar year. We've also submitted our application to the FDA for approval for MiSight as a myopia management treatment and expect to receive initial feedback within a couple of months. In the meantime, as the myopia management market continues developing, we're definitely seeing the value of offering multiple options to eye care professionals. So we look forward to expanding our offerings and availability. To wrap up on myopia management, our innovation pipeline is very healthy with eight focused pipeline products. Our sales and marketing efforts are proving successful. And our focus on leading with clinical data and providing the best and broadest portfolio on the market has us in an excellent position for continued success. To conclude on vision, our business is doing really well. The back-to-school season is healthy, new fits are doing well, and we're excited about our existing products and upcoming launches. On a longer-term basis, the macro growth trends remain solid, with roughly 33% of the world being myopic today, and that number expected to increase to 50% by 2050. Given our robust product portfolio, new product launches, myopia management momentum, and strong fit data, we're in great shape for long-term sustainable growth. Moving to CooperSurgical, this was an outstanding quarter with record revenues of 206 million. Fertility in particular continued to perform exceptionally well growing 72% year-over-year to 83 million. Strike was seen around the world and throughout the product portfolio including from consumables, capital equipment, and genetic testing. Some areas of strength included growth in media, pipettes, needles, incubators, and embryo transfer catheters, along with another very strong quarter from RI Witness, our proprietary automated lab-based management system that clinics implement to maximize safety and security by optimizing their lab practices. We're also benefiting from increased utilization of our artificial intelligence-based genetic testing platform, which increases the doctor's ability to select the best embryos for transfer. Similar to last quarter, we're continuing to see COVID impact the market but share gains and improving patient flow in most countries are driving our results. Regarding the broader fertility market, the global landscape remains fragmented with significant geographic diversity and within addressable market opportunity of well over $1 billion and mid-to-upper single-digit growth, this is a great market for us. It's estimated that one in eight couples in the U.S. has trouble getting pregnant due to a variety of factors, including increasing maternal age. And that more than 100 million individuals worldwide suffer from infertility. Given the improving access to fertility treatments, increasing patient awareness, greater comfort discussing IVF, and increasing global disposable income, this industry should grow nicely for many years to come. So overall, in fertility our portfolio and market positioning are excellent. We remain in a great spot for future share gains with improving traction in key accounts. We're seeing continued reopening activity around the world, and the industry has great long-term macro growth drivers. For all these reasons, we remain very bullish on this part of our business. Within our office and surgical unit, we grew 50% with PARAGARD up 51% and office and surgical medical devices up 49%. For PARAGARD, we implemented a roughly 6% price increase towards the end of the quarter, which resulted in a buy-in of roughly $4 million. This will impact our Q4 performance that the price increase is a long-term positive, noting with contracts and reimbursement timing, the price increase rolls in over the next couple of years. Within medical devices, several products performed well including Endosee Advance, our direct visualization system for evaluation of the endometrium, and our portfolio of uterine manipulators. To wrap up on CooperSurgical, this was another excellent quarter, and it was great to exceed 200 million in sales for the first time ever. Similar to CooperVision, we have powerful macro trends supporting our underlying growth and remain confident in our ability to continue delivering strong results. And with that, I'll turn the call over to Brian.

Brian Andrews, Chief Financial Officer and Treasurer

Thank you, Al, and good afternoon everyone. Most of my commentary will be on a non-GAAP basis, so please refer to our earnings release for a reconciliation of GAAP to non-GAAP results. Third quarter consolidated revenues increased 32% year-over-year or 28% in constant currency to 763 million. Consolidated gross margin increased year-over-year to 68.3% up from 66.3%, with CooperVision posting higher margins driven by product mix and currency and CooperSurgical posting higher margins from product mix tied to the significant year-over-year growth in fertility and PARAGARD. OpEx grew 28% as sales increased with a rebound in revenues along with higher sales and marketing expenses associated with investments in areas such as myopia management. Consolidated operating margins were strong at 26.6% up from 23.2% last year. Interest expense was 5.6 million, and the effective tax rate was 13.5%. Non-GAAP EPS was $3.41, with roughly 49.8 million average shares outstanding. Free cash flow was very strong at 180 million comprised of 224 million of operating cash flow offset by 44 million of CapEx. Net debt decreased to 1.5 billion and our adjusted leverage ratio improved to 1.5x. Overall, this was a very strong quarter and we exceeded our financial performance expectations. Moving to guidance, we continue monitoring and evaluating the scope, duration, and impact of COVID-19 and its variants. And while this remains a risk factor, our visibility is sufficient to provide the following update to our guidance. For the full fiscal year, we're increasing our constant currency guidance for both CooperVision and CooperSurgical and maintaining our non-GAAP EPS guidance. Specific to Q4, consolidated revenues are expected to range from 730 to 760 million up 7% to 11% in constant currency with CooperVision revenues between mean 540 and 560 million, up 6% to 10% in constant currency, and CooperSurgical revenues between 190 million and 200 million up 8.5% to 14% in constant currency. Non-GAAP EPS is expected to range from $3.24 to $3.44. To provide color on this guidance, currency moves since last quarter have reduced the benefit of the full year FX tailwind from 3% to 2.5% for revenues and 7% to 5% for EPS. With respect to Q4, this equates to reducing revenues by 10 million in CooperVision and 2 million at CooperSurgical and reducing EPS by $0.14. CooperVision is offsetting some of the impacts with expected strength in daily silicone and myopia management sales, while CooperSurgical is expecting continued strength, although incorporating the Q3 PARAGARD buy-in of $4 million and hopefully some conservatism regarding COVID's impact on elective procedures. Consolidated gross margins for the fiscal year are expected to be around 68% with fiscal Q4 gross margins expected to be around 67.5% driven primarily by currency. Operating expenses are expected to be slightly lower sequentially but similar to fiscal Q3 on a percentage of sales basis, as we continue investing in multiple areas such as myopia management and fertility. Our Q4 tax rate is expected to be around 11%. And lastly, our free cash flow continues to improve and we're now expecting roughly 515 million for the full year. And with that, I'll hand it back to the operator for questions.

Operator, Operator

Our first question comes from Matt Mishan from KeyBanc.

Matt Mishan, Analyst

On prior to COVID, I think you used to give early thoughts on the forward year on this conference call. And I'm just wondering if you would give any kind of thoughts around how we should think about FY 22 at this point, given these really strong quarters you're putting up?

Al White, President and Chief Executive Officer

Hey, Matt, good question. Always we thought about that. And I have certainly done that in the past. And I'd love to be able to do that. But I'm going to refrain from it just because of what's going on with COVID and the Delta variant and so forth. We're still kind of in that quarter-by-quarter phase to some degree. So once we hit December, we'll give full-year guidance and give as much detail as we can at that point. But for now I'll kind of stay away from fiscal 2022.

Matt Mishan, Analyst

Okay. And then, it also looks as if FX is impacting the fourth quarter versus original values, but also seems like your SG&A is running hotter, and you are investing a lot more in your growth or behind your growth drivers, which I think is a positive. But I guess my question is, when do we get to a point where will we see more leverage on the operating line? And then, how do you make sure in this environment you're hiring the right people given how like the tight the labor environment is, and how difficult it is to find people?

Al White, President and Chief Executive Officer

Yes. Some good questions in there. The labor market is tight. You're seeing that around. We are pretty actively hiring right now. When I look at the areas of opportunity for us, we're obviously investing in myopia management. We're hiring around the world, myopia management specialists and so forth and putting dollars behind product launches which we have going on in many markets around the world. It's a struggle in a few markets because of COVID restrictions and so forth, but we're still establishing a presence in a lot of new markets and grow myopia management. I look at areas like fertility as another good example, we're investing around the world. We're doing our best to go out there and recruit top talent who's going to support the business for long-term growth and I feel good about our ability to continue to put up gains. The other area I'd mentioned is single-use silicones. We're doing well there. We're gaining share there. We've got products in the marketplace and new products coming. So we're excited to invest kind of in that. When you look at operating leverage, I'd look at the two businesses a little bit differently. And maybe even you'd have to dig down, operating leverage for something like myopia management next year is when we start getting big enough. We should be in that 100 million range or so for our myopia management portfolio, you start getting to a point where you're starting to be able to leverage some of those investments, and then you do a better job of that right in the next couple of years. If you look at something like fertility as an example, I mean, great global business, nice growth, big opportunities, but still somewhat small. So it's hard to leverage that infrastructure. You're going to see the leverage from that come over the years as we continue to get bigger. But suffice it to say, you are summarizing that correctly, we are continuing to invest in the business. We are seeing share gains and opportunities for incremental share gains. So we're continuing to invest.

Operator, Operator

Thank you. Our next question comes in from wine of Jason Bednar from Piper Sandler.

Jason Bednar, Analyst

Al, if I could start just first on MiSight in China, appreciate the color there. But wondering if you could expand maybe on what the launch in this market looks like, beyond just some of the limited and full launch details, maybe how many doctors you're expecting to or planning to train. And really how you're thinking about servicing them this market. And on that note, you already used SLR for your Ortho-K distribution in China. It would seem like MiSight is just a good natural extension for that relationship. Is that the right way to think about how you plan to tackle that market, at least in the near term? And then, just relatedly, sorry for the series of questions. But can you address MiSight and myopia management revenue targets for fiscal 22? And maybe how China fits into that? Thanks.

Al White, President and Chief Executive Officer

When considering China, it presents a distinct market compared to what many might expect regarding optometry. In the U.S. and Europe, markets are often characterized by independent optometrists or large chains. While that also applies to regular contact lenses in China, products like MiSight treatment products are primarily distributed through hospitals. MiSight is sold in significant hospitals, whether public, government-owned, or private, which differs from traditional contact lens sales. You are right that SLR has a robust distribution network there, and we actually received approval for MiSight sooner than we anticipated. Currently, we are in active negotiations and should have news soon regarding the distribution of that product in the market. However, as I noted earlier, we need to manufacture and package those products post-approval, and we are working on ramping that up now. We expect to launch the product around November or December and will support it with pre-launch activities. A more significant market push will happen in January or February. Regarding our targets for 2022, we've discussed them quite a bit before, and I'm more confident about the projections we’ve made. We mentioned aiming for $50 million in MiSight sales next year and a $100 million target for myopia management. We will finalize these targets in December when we provide guidance. The main challenge I’ve noticed has been currency fluctuations, as many of our sales occur internationally. Overall, I feel optimistic about our growth opportunities in myopia management for 2022.

Jason Bednar, Analyst

Okay, great. That's really helpful and similar to what we discussed previously. As a quick follow-up related to the myopia management discussion, you mentioned a product in the pipeline. Could you provide some insight on the launch schedule? I don't want to go too far ahead, but any additional details on the potential impact of those individual launches would be appreciated. Thank you.

Al White, President and Chief Executive Officer

Yes. I won't, I guess just for competitive reasons, at this point, get into details and what those products are. But there is some exciting stuff that we have. And I thought it was worth mentioning eight individual targeted opportunities that we have in there. You'll be seeing those over the coming years. So the point is that we have an excellent myopia management product portfolio today. We're making advancements in each of the areas within there. We're going to be launching SightGlass. We're doing improvements on some Ortho-K products and launching those. And we have a number of things within the soft contact lens side tied to MiSight rollout that you're going to be seeing in the coming, yes, those eight products probably in the coming three years, something like that.

Operator, Operator

Thank you. Our next question comes from the line of Larry Biegelsen from Wells Fargo.

Larry Biegelsen, Analyst

Just one follow up on China, one on the recovery. So maybe thinking further ahead out on China. I mean, if we look at kind of what S4 is doing with Dallas, 1000 pairs a day, apply the ASP, roughly $500 for MiSight in China. I mean, it's easy to see, $100 million in sales for this product. I guess my question is, could you see this peaking, peak sales at over 100 million in, say, five years, just trying to understand what you think the long-term potential is. And I had one follow-up.

Al White, President and Chief Executive Officer

We need to observe how things unfold because if we proceed with S4, it will become a distributor relationship. We also need to understand how sales will develop. The market in China for MiSight is very promising, especially given the high rates of myopia. Since many children visit hospitals and we're not dealing with numerous different optometrists, the sales process is more focused due to the clinical advantages of the product. It has the potential to be very successful. We've noticed that many optometrists prefer glasses and are keen to promote them, particularly for children under 10. However, it's also common to hear optometrists express a desire to transition kids to treatment with contact lenses as soon as possible, believing it to be more effective. They recognize that treatment should be continuous throughout the day, and with contact lenses, children can engage in various activities without the need for glasses. Therefore, I can definitely envision a market for MiSight that could exceed $100 million.

Larry Biegelsen, Analyst

That's helpful. I have a question about how you approached the Q4 guidance and your observations regarding the Delta variant. It appears that when you compare growth for CVI and CSI to the same period in 2019, the midpoint of your guidance suggests some deceleration. Can you clarify how much of that is due to conservatism versus regional differences you are observing? Any additional insights you could provide would be appreciated. Thank you for taking my questions.

Al White, President and Chief Executive Officer

Sure. I kind of say that we're not seeing too much right now. Having said that, if you look at the Delta variant and we all read the same thing. You talk about deferrals of elective procedures, that kind of activity has hurt us a little bit when it comes to some of the CooperSurgical products as an example in the past. I don't know if it'll hurt us this time or not. I think Brian kind of set in there, hopefully conservative and I would certainly agree with that commentary. On CooperVision, it's somewhat similar. We've been seeing things continue to improve whether you're in Europe, whether you're in Asia Pac, you're seeing things continue to improve. The U.S. kind of came back relatively quickly. But we're still seeing fits improve a little bit in the U.S. So we're not seeing a lot of negativeness coming out of the COVID and Delta variant yet, but I certainly think it's prudent to be a little careful when you're guiding the numbers and what's going on in the marketplace today.

Operator, Operator

Thank you. Our next question comes from the line of Andrew Brackmann from William Blair.

Andrew Brackmann, Analyst

Maybe just the pivot to fertility for a second, another strong quarter there. Al, really appreciate your comments sort of on the macro tailwinds there, but maybe specifically to your business. Can you just sort of talk about maybe some of the initiatives that you're putting at play there to drive that growth? Thanks.

Al White, President and Chief Executive Officer

Yes, absolutely. So one of the things that I love about our fertility business is over the years, we've built kind of the full spectrum of products that a fertility clinic needs. So when we walk into a clinic, we're able to say hey, soups and nuts so to speak from the beginning of the process to the end of the process. Cooper Fertility is here for you and we're able to provide products for you. Now, we don't have pharma, so exclude pharma from that. But when you think about everything else, we have that. So when a new clinic is opening, or when a clinic is getting larger, and they're looking at it from a financial perspective of, hey, how can we maximize our own profits? When you're looking at key accounts, we've been very successful on vision. When you're looking at key accounts within the fertility space and the bigger clinics that are out there standardizing things, taking advantage of their volume purchases, and so forth, it puts us in an excellent position to be able to offer everything. So there is a focus on a variety of things that are geographic expansion because there's new areas out there, we're going into, there are areas around the world where you're seeing additional clinics being built out a focus on key accounts, trying to expand our relationships for those key accounts. And then, being a top service customer service provider, if you will, ensuring that clinics are getting products, I mean, that's one of the things is tough in a lot of industries right now, as demand for products and supply constraints, we've done a fantastic job. The team has really, really killed that in terms of maintaining our manufacturing and distribution network. So there's kind of all kinds of areas, I'd love to be able to narrow that down to one, but the answer is a little bit more complex there. But it's kind of a full-scale sale into fertility clinics.

Andrew Brackmann, Analyst

Great. Yes, I get it. And then, maybe just as a follow up there, obviously, appreciate your comments on sort of the infrastructure that you're building here. But as we think about sort of capital deployment and free cash flow that you're generating. How should we be thinking about M&A in this sort of area moving forward? Thanks.

Al White, President and Chief Executive Officer

Yes. I mean, we still have some debt, we're paying down a little bit of debt, our leverage has been in much better shape than it's been in a long time now and cash flow is pretty strong. When it comes to M&A, we'll look for opportunities. And if we find something, we're happy to do it again, I'd still say the stuff that we're going to look for is going to be strategic. And I don't mean made-up strategic stuff. I mean, stuff that if we happen to find a deal, it's like the deals we've done, you're going to be like, I get that. That's fits in. That's a Ortho-K company. That's an OB-GYN, medical device company, that kind of stuff. So we'll continue to look at those opportunities. But we're also going to model those out. And we're careful about that. We're not going to run around and overpay for stuff. We have a long-term business model here and financial metrics that we need to hit in order to do deals. Otherwise, you get to doing what we're doing paying down debt, and we'll look at buying back stock and so forth if the opportunities arise.

Operator, Operator

Thank you. Our next question comes from the line of Jon Block from Stifel.

Jon Block, Analyst

I guess the first one, Al, I thought I heard you correctly, saying that you were going to pursue or submit MiSight as a treatment to the FDA. And we'd love a little bit more color, in other words, what does that do for you guys? Is it sort of strengthen the marketing message to the parent? Or is that also possibly the first step down the road for reimbursement? If you're able to go that route, as we think about it more in the out years? And then I've got a follow up.

Al White, President and Chief Executive Officer

Yes. Well, MiSight already approved basically as a treatment. So we are there, SightGlass is the one that we're going for right now to get FDA approval for SightGlass. And I think that's really powerful. To me, we get the questions on glasses, rightfully so when it comes to myopia control. If we can get approval for SightGlass, then it becomes the only FDA approved myopia control glass option on the market. I mean, that is pretty exciting to me. So we submitted that right now. Now, to be fair, it took three-year clinical data for the FDA approved MiSight. We have two-year data on SightGlass. SightGlass was clinically developed to meet the FDAs clinical requirements. So the question will end up being them looking at that data, which is good data. Do they need three-year data? Or would they be willing to potentially approve that off two-year data? So it'll be interesting to see how that plays out. But it's really SightGlass that I was referring to when I was talking about new approvals.

Jon Block, Analyst

That's my bad. I misheard you. So I'll sort of try to jam in two questions into one. And so the first one now is, when I think about your numbers on your myopia management portfolio next year, my take on from 20 million to 50 million, it implies if the overall portfolio goes 65 to 100. Really the Ortho-K, it sort of goes from 45 to 50 or only. And so maybe just talk through, why would it de-sell like that? It's growing so rapidly right now, the markets do you think there's some cannibalization there? So that's my sort of one freebie question for screwing up the last one. And then, the other one is just the Americas. I mean, it was really strong results in CVI. But I was a little bit surprised to see the two-year stack stepped down a good amount. America seems to be sort of the best backdrop when we think about Americas, EMEA, and APAC. So maybe just some color, why the de-sell and the two years stack. Is it market share? Is it Delta or is it just lumpy? And thanks for your time, guys.

Al White, President and Chief Executive Officer

On a two-year basis, there are different ways to look at the numbers since everyone calculates them differently. If we consider the growth compared to 2019, in constant currency for the calendar quarter, we saw an 8% increase. That’s a solid figure, but understanding the specifics for the U.S. market is more challenging due to the shifting channel inventory. While I hear discussions about that, we haven’t observed significant impacts personally. To summarize, for calendar Q2 compared to Q2 of 2019, we experienced an 8% growth, while the market grew only 4%. So, we are outperforming the overall market, though I lack complete data for the U.S. Regarding myopia management, the figures indicate MiSight growing from 20 to 50, and the Ortho-K growth from 45 to 50 amounts to approximately 100 million. To clarify, I still believe we’re exceeding 100 million, but I won’t provide more detailed numbers until December. Our Ortho-K business is performing well, gaining momentum, and we have a strong team driving it forward. I’m optimistic about Ortho-K, and there’s no reason to interpret the 100 million figure as negative or indicative of cannibalization, as MiSight is actually supporting our Ortho-K growth. So, please consider the 100 million as a minimum estimate.

Operator, Operator

Thank you. Our next question comes from the line of Jeff Johnson from Baird.

Jeff Johnson, Analyst

Hey, Al, I just wanted to follow up on Jon's question. You were discussing the calendar and fiscal numbers. Based on my calculations, your fiscal two-year growth in America seems to be around 5.6%. You mentioned an 8% growth for the calendar quarter, which suggests we would have to see a significant decline in sales in July for both figures to align, and I can't see that happening. Could you clarify that? More importantly, you mentioned a 4% market growth, but we know Bosch reported 17%, Alcon 16%, and J&J at 6% for the calendar second quarter two-year growth rate in the U.S. I'm struggling to reconcile your 4% market growth. There are many figures being discussed, so could you help us understand how you came to your conclusions?

Al White, President and Chief Executive Officer

Yes. So I'm just doing calendar Q2 growth against 2019. So I'm not quite sure right on a constant currency basis. So I'm not sure all the numbers you're quoting there. But if you go to calendar Q2 against this year against calendar Q2 of 2019 and look at those numbers on a constant currency basis, that's what I'm talking about. When you get down to some of the individual markets, it can get pretty lumpy and get a little bit more difficult right to dig into those details because you do get, how are you going to adjust those numbers? How are you going to adjust for commentary that you hear from some of the competitors about channel inventory, or this that or the other thing? So I've just kind of tried to pull it up, Jeff, you're asking about kind of market share? When I look at it, I'd say okay, well, what did you grow against? 2019 Q2 at? We grew eight and I've got the market growing 4. Yes. Okay. I just struggle on that one. Yes. And just to be clear, like, we didn't see anything strange happen, like going into the one month of July. July was a fine month for us.

Operator, Operator

Thank you. Our final question comes from the line of Steve Lichtman from Oppenheimer.

Steve Lichtman, Analyst

Thank you. Hi, guys. Al, you mentioned your estimated market growth in 2Q '19 at about 4%. Do you think that holds on a unit basis as well? Is net price holding flat in your view?

Al White, President and Chief Executive Officer

It's always challenging to assess units due to the differences between daily and monthly lenses. The essence of your question really pertains to pricing, which is an important issue. We've observed prices trending upward. Earlier this year, we reduced some rebates, and both we and our competitors have slightly increased list prices. As we entered the back-to-school season, which typically sees more competitive pricing, that hasn't been the case this time. Therefore, when considering current pricing, it's a positive sign, albeit modest. We'll have to monitor this in relation to inflation and possible future price increases, but for now, it indicates a positive trend.

Steve Lichtman, Analyst

Got it. Thanks. And then just a couple of quick last ones. Would you be willing to provide us with the approximate discrete investment for myopia management here in FY21 and about how much of the $5 million MiSight was U.S. this quarter? Thanks.

Al White, President and Chief Executive Officer

Yes, we're not going to disclose that number. We provided it for a while, but now we have incorporated it into our guidance. The U.S. revenue was definitely over $1 million this quarter out of the $5 million total.

Operator, Operator

Thank you. This does conclude the question-and-answer session of today's program. I'd now like to hand the program back to President and CEO, Al White.

Al White, President and Chief Executive Officer

Great. Thank you. Thank you, everyone. So I've kind of mentioned this as we went through the call, business is looking pretty good and we're pretty excited about where we are and what the future holds for us. A lot more stuff going on. Hopefully, we'll have some good news as we move through this quarter and look forward to giving you that update and present '22 guidance on our December call. So, thank you everyone for your time and we'll talk soon. Thanks.

Operator, Operator

Thank you, ladies and gentlemen for your participation in today's conference. This does conclude the program. You may now disconnect. Good day.