Evolus, Inc. Q2 FY2025 Earnings Call

Good afternoon, everyone, and thank you for standing by. Welcome to Evolus' Second Quarter Earnings Conference Call. As a reminder, today's conference is being recorded and webcast live. I would now like to turn the conference over to Nareg Sagherian, Vice President and Head of Global Investor Relations and Corporate Communications. Please go ahead.

Thank you, operator, and welcome to everyone joining us on today's call to review Evolus' second-quarter financial results. Our second-quarter press release is now on our website at evolus.com. With me today are David Moatazedi, President and Chief Executive Officer; and Rui Avelar, Chief Medical Officer and Head of R&D. Today's call will include forward-looking statements. Actual results may differ materially due to risks and uncertainties outlined in our earnings press release and SEC filings. These forward-looking statements are based on current assumptions, and we undertake no obligation to update them. Additionally, we will discuss certain non-GAAP financial measures. These measures should be considered in addition to and not as a substitute for our GAAP results. A reconciliation of GAAP to non-GAAP measures is included in today's earnings release. As a reminder, our earnings release and SEC filings are available on the SEC's website and on our Investor Relations website. Following the conclusion of today's call, a replay will be available on our website at investors.evolus.com. With that, I'll turn the call over to our CEO, David Moatazedi.

Thank you, Nareg, and good afternoon, everyone. Our second quarter results came in below expectations, reflecting one of the most challenging market environments we've seen in recent years. Jeuveau experienced its first-ever year-over-year decrease since launch more than 6 years ago, underscoring a sharp reduction in consumer sentiment resulting in broad softness across the U.S. aesthetic toxin market. Procedural volumes across the U.S. toxin category decelerated further in the second quarter, following a slower-than-expected start to the year. Throughout the majority of the quarter, we were outperforming on the launch of Evolysse and Jeuveau was tracking to our internal forecast. In the final 2 weeks of the quarter, we started to experience lower order volumes compared to the prior quarter closes. This was the first time we felt the effects of the market slowing, which resulted in accounts holding back their order volumes. While procedural volumes across the U.S. toxin market decreased over the past 3 consecutive quarters, the second quarter marked the first time we felt the impact on Jeuveau demand. Despite these domestic headwinds, we continue to gain market share through the first half of the year and are beginning to see early signs of positive momentum entering the third quarter. Given the unusually slow finish to the quarter, we conducted an Evolus-led survey of nearly 200 U.S. customers to better understand their market outlook in the coming 6 months. The results pointed to a meaningful rebound in patient volume in the second half of the year. A majority of practices expect growth of more than 10%, while very few anticipate any decline, a stark contrast to the first half of the year. These findings were further validated by an independent survey of 200 providers, reinforcing our view that demand is expected to improve incrementally in the back half of the year, even as consumer discretionary spending remains under pressure. Given these market challenges, we've taken decisive action to ensure we maintain our commitment to long-term value creation. This includes revising our 2025 outlook to reflect current U.S. market trends while realigning our operating model to preserve profitability and sustain investment and growth. We've reset our 2025 revenue expectations, rebased our spend to align accordingly and maintain our long-term outlook of reaching $700 million by 2028. We've reset our 2025 revenue guidance range to $295 million to $305 million, representing 11% to 15% growth over 2024. This new guide reflects a meaningful increase over the first half performance and benefits from 2 full quarters of Evolysse revenue, which is off to a great start and an incremental improvement in the U.S. toxin market from the front half of the year. We've rebased our non-GAAP operating expense guidance to $208 million to $213 million. This results in more than $25 million in operating expense cost savings with the majority of reductions concentrated in G&A while maintaining investment in our customer-facing activities. We are committed to achieving meaningful profitability in the fourth quarter and annual profitability starting in 2026. We have implemented strategic reductions that are designed to preserve growth and sharpen execution. These were not broad-based cuts. They were intentional, long-term changes that allow us to rebalance resources toward customer-facing areas of the business. Approximately 70% of the reductions were noncustomer-facing and noncommercial in nature, ensuring no disruptions to the team driving top-line growth. We also consolidated functions to reduce overhead while continuing to invest in our commercial infrastructure and further lean into automation, including AI to enhance productivity. These actions reflect our commitment to disciplined execution and position us for sustainable growth. Despite softness in the quarter, Jeuveau remains resilient and has continued to outperform the U.S. market with unit growth in the front half of the year. We've maintained our 14% market share through the first half of the year, which reflects an increase over our full year 2024 share of 13%. In the quarter, we added 565 new purchasing accounts, consistent with our goal of at least 500, indicating strong interest in Evolus in a challenged market. Our unique cash pay model continues to differentiate us in the market, while our co-branded media and digital platform deepen customer engagement even as consumer spending patterns remain cautious. Our consumer loyalty program also delivered strong results. Evolus Rewards redemptions hit a record high of over 224,000 with 65% coming from repeat patients, highlighting the strength of our brand and consumer satisfaction. Importantly, Evolysse is now launched within Evolus Rewards, further enhancing patient retention and adding another lever of growth to our consumer engagement platform. As the market stabilizes, the consistent demand we're seeing through our loyalty program, combined with our advancing market share puts Evolus in a strong position to continue to outperform the market in the near term and as the market recovers. Internationally, the business continues to deliver strong performance and is increasingly contributing to our growth trajectory as we expand our global footprint in key markets. In early July, we introduced Nuceiva in France through our partnership with Symatese. While we view this launch as a strategic step forward, we expect its near-term revenue contribution to be modest. We are now active in 9 markets outside the U.S., representing over 70% of our international total addressable market. This progress not only reflects the increasing demand abroad, but reinforces the rising global relevance of our brand. We remain on track to achieve $100 million in international revenue by 2028. A highlight of the quarter was the U.S. launch of Evolysse, which exceeded our internal expectations. In its first quarter, Evolysse delivered $9.7 million in revenue, making it the strongest first-quarter filler launch in over a decade. This performance was supported by a combination of initial stocking of Evolysse and strong demand following a successful launch. The initial response from customers continues to be overwhelmingly positive with strong feedback on the product's performance. They continue to praise the line's unique natural gel properties, which offer precision and control, key attributes prioritized in daily practice. Our focused launch strategy, backed by Evolus Academy and the science of Cold-X Technology has been very successful. Since launch, we have trained over 4,000 health care providers and over 1,000 accounts have already ordered Evolysse with several thousand trialing. We're in the early stages of penetrating the filler market and see a meaningful runway for continued growth and account expansion. Based on this early momentum, we are raising Evolysse's full-year revenue contribution to 10% to 12%. The strong early adoption and enthusiasm confirm our confidence in Evolysse as a long-term growth pillar. We're applying the same disciplined approach to Estyme in Europe, prioritizing education, market preparation, and launch excellence to ensure long-term success. Our experience program is well underway with a broader launch expected in early 2026. Based on these key business drivers, the continued share gains in our toxin business, the record-setting launch of Evolysse, and strong performance internationally, we have confidence in our ability to deliver sustainable growth. The fundamentals of our business remain intact and our recalibrated cost structure positions us to scale profitably as market conditions improve. With that, I'll turn it over to Rui to walk through the results of the first-ever head-to-head study of 4 U.S. FDA-approved neurotoxins that was recently published in JAMA Dermatology, along with a few additional updates.

Thank you, David. In 2019, during the initial stages of our approval process for Jeuveau, we ran the largest Phase III trial against BOTOX, which was published in the Aesthetic Surgery Journal. In that study, the primary endpoint responder rates were 82.8% for BOTOX and 87.2% for Jeuveau. Thirty additional endpoints were also measured. Although not reaching the level of statistical significance, it was interesting to note that Jeuveau outperformed BOTOX numerically 26 out of 30 times. In the August edition of JAMA Dermatology, a new independent study was published that looked at the 4 neurotoxins approved at the time—Jeuveau, BOTOX, Dysport, and XEOMIN. The study was conducted at the University of Pennsylvania and the senior author was Dr. Ivona Percec, a world-renowned plastic surgeon and researcher. The trial was double-blind, randomized, and enrolled 143 patients evenly across the 4 neurotoxins. To measure effectiveness, instead of using the standard 4-point scale traditionally used in clinical trials, the investigators used a sensitive imaging system from Canfield, capable of precisely measuring the amount of strain when crowning, eliminating the bias that can be introduced by human evaluations. The results demonstrated that Jeuveau and Dysport had the fastest onset. At day 30, which is generally described as the timing of peak effect, Jeuveau demonstrated the greatest effect. And at day 180, Jeuveau demonstrated the longest duration, maintaining a statistical difference as compared to its baseline and as compared to BOTOX. In summary, this independent study conducted by independent investigators demonstrated that Jeuveau numerically had a fast onset, the highest peak effect, and the longest duration, further validating its performance. On the Evolysse injectable side, we continue to receive feedback that's consistent with what we observed in the clinical trials and heard from clinicians during diligence. The gel is different, and it feels different. It's described as very efficient in providing corrections when injected and results in a natural look. We also continue to hear from injectors that it's very forgiving. The low inflammatory profile of these gels allows them to be placed more superficially than you'd expect without having an inflammatory reaction. And that form is being described as a very versatile HA injectable as we had expected. On the pipeline front, Sculpt, which will be targeting the premium MI-based volume market, remains on track. We're targeting the PMA filing this quarter and estimating an approval in the second half of 2026. The lips product also remains on track. The trial was fully enrolled in February of this year, and we continue to estimate approval in 2027. Now let me turn it back to David to take you through the financial details of our second quarter.

Thank you, Rui. Global net revenue for the second quarter was $69.4 million, a 4% increase over the second quarter of 2024. Sales growth in the second quarter was driven by the successful launch of Evolysse and international revenue growth. Net revenue for the second quarter of 2025 included $59.7 million of toxin revenue and $9.7 million of HA gels revenue. Our reported gross margin for the second quarter was 65.3% and adjusted gross margin was 66.5%, which excludes the amortization of intangibles. Gross margin for this quarter was impacted by a higher mix of international sales and an introductory pricing offer for Evolysse. The impact to margins was unique to the quarter. And going forward, we expect margins to improve in the back half of the year. On the topic of tariffs, our exposure is limited to the transfer price of our products, which is accounted for in the cost of goods sold and included in both our reported and adjusted gross margin. Evolysse is sourced from France and will be subject to a 15% tariff, which is scheduled to go into effect on August 7. The impact of this tariff is minimal and has been fully incorporated into our guidance. Jeuveau remains unaffected by tariffs as pharmaceuticals are currently exempt. We continue to closely monitor developments and take prudent and proactive measures to manage toxin and HA gel inventory levels to mitigate any potential exposure moving forward. GAAP operating expenses for the second quarter were $55.5 million, down from $61.8 million in the first quarter. Non-GAAP operating expenses for the second quarter were $54 million compared to $52.9 million in the first quarter. As a reminder, non-GAAP operating expenses exclude stock-based compensation expense, revaluation of the contingent royalty obligation, and depreciation and amortization. Within operating expenses, selling, general, and administrative expenses for the second quarter were $56.7 million, consistent with the first quarter, reflecting investments in growth and commercial expansion in support of Evolysse. This included $4.3 million of non-cash stock-based compensation compared to $5.7 million in the prior quarter. Non-GAAP operating loss in the second quarter was $7.9 million compared to non-GAAP operating income of $1.1 million in the second quarter of 2024. Both non-GAAP operating expenses and non-GAAP operating income exclude stock-based compensation expense, revaluation of the contingent royalty obligation, and depreciation and amortization. Non-GAAP operating income also excludes amortization of intangible assets. Turning to the balance sheet. We ended the second quarter with $61.7 million in cash compared with $67.9 million at the end of the first quarter. The decrease in cash during the quarter was primarily driven by our decision to pull forward inventory purchases ahead of increased tariffs on the European Union and threatened tariffs on pharmaceuticals. After factoring for the reset in this year's guidance, we continue to see a clear pathway to achieving our long-term outlook of $700 million by 2028. As we outlined in prior calls, we saw many ways to outperform the $700 million target, and our internal projections were meaningfully above our long-term guidance. We also reaffirm our goal of delivering a non-GAAP operating income margin of 20% by 2028. Our revenue growth will be driven by continued performance in our neurotoxin business, both in the U.S. and internationally, along with an increasing contribution from our novel line of injectable hyaluronic acid gels. With that context in mind, our outlook for 2025 and beyond includes the following: Total net revenues for the full year 2025 to be between $295 million and $305 million, representing 11% to 15% growth over 2024 results. We've increased our revenue expectations for Evolysse and now expect revenue contribution to be 10% to 12% of total revenue for the full year 2025. Full-year non-GAAP operating expense for 2025 to be between $208 million and $213 million, reflecting strategic cost structure optimization that is expected to yield at least $25 million in non-GAAP annualized operating expense savings for 2025 to achieve positive non-GAAP operating income beginning in Q4 '25 and annual profitability beginning in 2026. And lastly, total net revenue of $700 million and non-GAAP operating income margins of 20% by 2028. With that, I'll now turn the call back to the operator to begin Q&A.

Our first question comes from Annabel Samimy with Stifel.

I'm curious about the dynamics you're experiencing. To what extent are you seeing reduced demand as a result of consumer sentiment compared to increased competition? What was specific about the last two weeks of the quarter that led to such a significant drop in demand? Additionally, could you quantify the inventory buy-in related to the $9.7 million that you reported for Evolysse?

Annabel, thanks for the questions. I'll take those 3. So just starting with the question around the reduced demand, consumer versus competitive. The way we look at it from a first-half standpoint, we believe that procedural demand declined high single digits. When we look at our business in units, as we talked about, we gained a few percent. So relative performance, we don't believe that it was a share or competitive-driven dynamic. But of course, the demand overall in the market was down in the first half of the year. It has been down starting the fourth quarter of last year, and this was the first quarter that we felt it. And what was interesting was that in May, as we were entering the last month of the quarter, we had many strong signals. Evolysse had exceeded our full quarter expectations in its first month on the market. We had Jeuveau, our lead metrics as we looked at our Evolus Rewards redemptions as well as our own forecast internally, they appear to be right on track. So there were some unique dynamics there at the end of the quarter where we generally see accounts purchasing to meet their tier threshold levels to maintain their pricing status for the following quarter. And essentially, what we saw were a number of accounts in that top tier, especially where they froze. They saw the broader impact of the macro environment. That's a combination of slowing demand in their practice as well as some of the things that were happening broader in the economy and their interest level and purchasing at the same level they had historically just weren't there. And we saw that significant pullback acute to the final several weeks. And then lastly, on the Evolysse, what we'd say is that we do believe that the initial portion of revenue had a stocking element as well as a pull-through. Of course, it's hard to quantify early on. But I think if you're thinking of it as sort of like a relatively even mix of those 2, that's probably a relatively safe way to think about the business. That's not precise math, but it's just based on what we're seeing in reorder patterns, etc. And then the last thing that I would point out, Annabel, which was interesting to us, here we sit in August is that we saw a pretty significant shift in the business as we entered the third quarter and that July, we saw a meaningful improvement in our business that correlated with some of the research that we saw, both our internal research and third party that we referenced earlier in our script.

Our next question comes from the line of Marc Goodman with Leerink Partners.

Just to clarify your previous question, July showed a significant improvement, but there was no follow-through in June during the last two weeks. How would you explain that? Are your customers focused on quarterly performance like a publicly traded company?

Yes, that's a good question, Marc. I don't think we can directly link our fiscal quarter to customer purchasing patterns. What I can say is that our pricing program requires customers to purchase at a certain level to achieve specific status, and this level is determined by full-quarter purchasing. We usually find that towards the end of the quarter, accounts place larger orders to maintain their status, working down their inventory to make large purchases at that time. However, we noticed that those accounts did not place orders at the historical levels we expected. While they were still making purchases, the average volume was significantly lower than what we anticipated at the end of the quarter. This situation is separate from the year-on-year starts we are observing for the third quarter. I want to clarify that we expect challenges related to consumer spending as the macroeconomic environment will likely continue to make it difficult for consumers to afford these treatments, which is impacting our business. However, in the latter half of the year, we expect to build off a relatively low base, which we believe will create a favorable backdrop. We also think that the slowdown we are seeing in the first half should benefit us in the second half sequentially, though not to the extent that we see a full market recovery.

Yes. Did Hugel have any impact at all on anything as far as just giving away free product?

Yes, it's a good question. And Annabel was asking about the competition. We look at a number of third-party data for competitive dynamics to understand if there's any significant share shifts. And there really wasn't. Of course, there's Hugel now a couple of quarters into their launch in the market. They do sample heavily, and we have a good sense for what that impact is, but it's a very small part of the overall picture for the toxin market as you think about the second quarter, not a key driver.

Our next question comes from Navann Ty with BNP Paribas.

Can you clarify the toxin demand trends, which was not highlighted by competitors, Galderma and AbbVie? So was the impact more pronounced on the low end of the market? And second, how do you expect reaching about $140 million Jeuveau revenue in H2 and market stimulation or promotional activity in Q4?

Yes. All very good questions. I think there's a lot of noise in the market in terms of what's really occurring. I can tell you that we look at third-party data, including transactional data that supports the overall transactional volume across different specialties of dermatology, plastic surgery, and med spa combined pointed to a front half that had a high single-digit decline. I think that was supported when you look at, as an example, the market leader in the space, their overall toxin business declined in the high teens in the front half of the year. And so you see that reflected there. Some other competitors did not comment on some of these trends. And of course, there may be reasons for that, which I'm not going to be able to get into in this call. But I think you're getting mixed signals on that. But the third-party data that we get on transactions confirms that it's consistent with what we're seeing in the market that overall procedural volume did slow in the front half of the year.

And then maybe on the second half, if you have any market stimulation or promotional activity coming in Q4?

Yes. As we observed that slowdown in the back half of the second quarter, the back couple of weeks, we did adjust our promotional strategy, specifically around Jeuveau to help practices with the pull-through. As we've spoken with a number of clinics and I spent time in the field, what I've heard consistently is that consumers are stretching their intervals between treatments or they're reducing the number of units that they're getting when they're coming in, whether that's syringes of hyaluronic acid or units of neurotoxin. And we've done a number of things through our Evolus Rewards program to help subsidize a portion of that cost for the consumer. Of course, you see some of that reflected lightly in our gross margins in the second quarter, but we do believe that helps with the pull-through. We've also collaborated with a beauty magazine to coordinate a gift with purchase that we're doing in the third quarter. Those types of activities help differentiate our clinics in their local markets and provide more value to that consumer to come back in and get treated. And we do believe these types of pull-through activities help our accounts that remain committed to us that we believe will continue to drive our growth in the future. It helps them pull through that product and build their business over time. And we're seeing some good response to those activities that we just initiated in the third quarter.

Our next question comes from the line of Uy Ear with Mizuho.

Can you help us understand more about the consumers? You mentioned some surveys indicating a rebound. What specifically is driving this rebound? What has changed financially for consumers? That's my first question. My second question relates to your guidance, which suggests either sequential growth from the second to the third quarter or a significant increase in the fourth quarter. Could you clarify how we should interpret the progression for the second half of the year?

Good. First, Uy, I think I was really choiceful with my words, especially in the press release. I do believe, as you think about the front half versus back half, we see an incremental improvement sequentially in the toxin market. We do believe there remain a number of consumer headwinds. And of course, as these tariffs now factor through into price across different categories, we do think the consumers that are a sweet spot, they earn $150,000 or less per year, they'll feel that pinch. And so that incremental improvement is based on the survey that I referenced in addition to the fact that we wrap around in the back half of the year on a more depressed base. And when you put those 2 together, we feel that it makes for an incremental improvement in the back half of the year. As it relates to our forecast, when you look at the front half of the year, the business grew about 9%. And our implied forecast is, of course, that we'll grow at a faster rate in the back half, depending on where you are in the range, it's anywhere from roughly, call it, 14% to 18%. And really, the logic behind that is when you think about the back half of benefits from the first half having a number of one-timers, right? In the first half of the year, we had just 1 quarter of Evolysse. In the back half, you get 2 quarters. We do believe that the onetime sort of drawdown that occurred in the last 2 weeks is unique to the second quarter, and that does provide a benefit in the back half of the year in addition to the base comparator period. And when you put that together, we do believe it sets up for a stronger back half relative to the front half and puts us within the guidance range that we provided.

Our next question comes from the line of Serge Belanger with Needham & Company.

I guess another question on overall trends. David, we've seen this market be pretty resilient over the years. I think the only time we've seen negative growth has been a pretty severe recessionary environment, and I don't think we are in that kind of environment. So just curious, what do you think is driving kind of this different consumer sentiment at this time? And then secondly, you talked about the competitive environment. Just curious if you've seen any changes to price levels at this point, either via tariffs or again, to deal with depressed consumer sentiment, a decrease in price to encourage an increase in procedures and purchases?

Sure. Serge articulated the point effectively. This time is indeed different from previous recessions. When you examine the overall economy, it appears to be relatively stable. However, in categories like neurotoxins, you would generally expect to see similar stability, which hasn't occurred. For instance, the market leader, which constitutes about half of the category, has experienced negative growth for three consecutive quarters, and the earlier part of the year has shown a consistent decline. What's particularly noteworthy is that consumers earning $150,000 or less are significantly impacted by rising prices and the uncertainty created by tariffs. This trend is evident in the earnings reports from companies catering to this demographic. In contrast, consumers in higher income brackets seem to have handled the situation better. This discrepancy illustrates a divide, leading to challenges in this specific segment. However, we believe the strategies we implemented for the latter half of the year position us well, as we've been gaining market share for several years now. It's important to note that our brand is in its sixth year and has achieved over 30% growth for five consecutive years. This is the first instance of a notable disruption like this. While we see some positive trends for the second half of the year, they don't alleviate overall concerns for the full year. On the competitive front, we haven't noticed any price increases connected to tariffs yet. In the neurotoxin sector, drugs haven't been affected by tariffs thus far. There's always an influx of new products and various promotional strategies, but nothing significant enough to alter market perceptions.

Our next question comes from the line of Douglas Tsao with H.C. Wainwright.

David, thank you for your insights. As I listen, I find it challenging to reconcile the reduced guidance, which feels appropriate and quite substantial, with your earlier comments suggesting that the first few weeks of July indicated some recovery or bounce back. Could you help clarify this? Did we see a recovery in July, but not enough to reach previous levels? It seems things picked up a bit but did not return to the trajectory we had before.

Yes, Doug, I've had a couple of questions on this, so I'll try to answer it a little differently. What we observed in the last two weeks of the quarter was entirely unexpected, with a significant slowdown in ordering from these accounts. However, what we're seeing at the start of July isn't reflecting that trend. We're noticing an incremental improvement. I wouldn't go so far as to say we expect a rebound in the third quarter, as that would suggest the markets have returned to normal. Our guidance, as well as the adjustments to our expenses, is based on the assumption that we won't see a return to the levels we initially anticipated. We expect a gradual improvement in the third quarter compared to what we experienced at the end of the second quarter.

That’s really helpful. You mentioned regarding Annabel's question that about half of the sales for Evolysse this quarter were likely due to stocking. Given the significant inventory in the channel, do you expect the third quarter to be relatively flat or even decrease before a possible increase in the fourth quarter? I’m trying to understand the timing, especially since the feedback on the product and its performance has been very positive. I’d like to know how we should anticipate this trajectory, considering it was such a strong launch, and I want to ensure we manage our expectations appropriately.

Yes, it's a great question on Evolysse. And really, that idea of the 50-50 mix of the revenue was really based on, one, just to appreciate sort of how we ended up there, we sampled very heavily our top customers in the second quarter right after we launched. A number of those customers then placed an initial order and then a number of those reordered as well. So we worked through sort of the flow of the product by customer type and came up with a thoughtful view on what the pull-through was. I think the answer on the third quarter rather than just focusing on that, what I would say is really focusing on the back half of the year, based on the guide we gave you, I think you can back into a view that the third quarter is generally going to be softer in terms of demand than the fourth quarter. And so naturally, we'd always expect the fourth quarter to be stronger. And so from there, you'd want to back into what your assumption is for the third quarter without giving you specific guidance.

Our last question comes from the line of Sam Eiber with BTIG.

Maybe I can start on the filler side and how the go-to-market strategy is being received by customers thus far? And I guess as a follow-up, if the current environment within the toxin market is making you rethink potential bundling opportunities with Jeuveau?

Sure. Well, first, the Evolysse launch, as I mentioned earlier, it exceeded all expectations that we had. The Drop the F Word campaign immediately set us apart in the category, especially at a time when the overall category for fillers has been in a constant decline. And I think that approach opened many accounts up to be receptive to our messaging, which is very differentiated from the competitive set with the Cold-X Technology creating a more natural gel and our differentiated label, which talks about weight loss, combined with our head-to-head data versus one of the market-leading hyaluronic acids. When we couple that with our Evolus Academy, our initial training webcast, we had over 3,000 doctors that joined that initial call to hear from key opinion leaders in the space. And since then, we've trained a number of key opinion leaders to be trainers as part of our Evolus Academy, and they're out training throughout the country on this new technology. From a consumer standpoint, we've had really strong media coverage. When we compare back to historical product launches, this really stands out. We've had the major media outlets independently cover us in exclusives. We did receive a number of best-in-class awards from journals like Shape magazine and Allure. And I think those types of things lend further credibility in the consumer's eyes around how the product performed. And so overall, we feel that the metrics around this launch are incredibly strong despite a backdrop that, as we talked about, has been challenged. And so we feel good about the trajectory we're on there. As it relates to Jeuveau, look, I think Jeuveau's performance in its sixth year in the market continues to be strong. As we entered this year, there's a question around whether we could, coming out of the fourth first quarter, maintain sort of this 14% share. And through the front half of the year, we have, despite the fact that we recognize the backdrop of overall procedural volume declining does create a mask that overperformance in the market. We do think Jeuveau is very well-positioned in this market. We referenced the data that Rui talked about, which is the first independent head-to-head study. And I can tell you, we've shared that with many clinicians, and it does resonate with them. And coupling that with our ability to do consumer marketing differently as a beauty company, we're leaning further into that here in the third quarter in helping pull through the business. And I do believe once you step back from the macro environment, what you would say is the fundamentals of our business are intact. The launch is off to an incredibly strong start. Jeuveau is performing within the market of neurotoxins, and our international expansion is right on track. So we feel there's a number of bright spots despite the overall top line coming down. And then, of course, the expense base that we now operate under creates a meaningful opportunity as you think about the back half of the year and into next year to overperform on our goals of profitability.

Okay. Okay. That's helpful. And then coming to the reiterated 2028 targets, can you just maybe help me think about the levers to get there with the deceleration now in the toxin market? Is it assuming a faster rebound and reacceleration in '26? Is it market share gains beyond the 14% you have now? Is it Evolysse going beyond initial expectations? Just walk me through the levers to get to the 2028 targets.

Yes. Rather than getting the levers, I think I'll keep it pretty simple for you. We had an internal forecast that was well above the $700 million and revising down our guidance, here we effectively flowed that revision down into our forecast out to 2028, and we continue to remain at or above that $700 million mark. I think as we close out the year, we'll give you an update in terms of a combination of our views on the rebound as well as what this means as you go out to 2028. But for now, I think it's clear that we continue to remain on track to get there based on the original models that we had designed. And what we've done here in the reduction in guidance doesn't change that outlook.

There are no further questions at this time. I'd like to pass the call back over to David for any closing remarks.

Thank you. As we close out the first half of 2025, we remain strongly positioned in our category with multiple growth engines driving our momentum. We gained toxin share in the front half of the year, outperforming a category that continues to face headwinds from softer consumer sentiment and lower procedural volumes. At the same time, we executed the most successful U.S. filler launch in over a decade with Evolysse, which is establishing itself as a contributor to our growth and a cornerstone of our long-term strategy. Internationally, we continue to scale our footprint across key markets, further validating the strength and global relevance of the Evolus brand. We are well-capitalized and operating with a leaner, more efficient cost structure that supports our path to profitability in the fourth quarter and sets the foundation for sustained growth in 2026 and beyond while maintaining our focus on long-term value creation. Thank you.

We reached the end of our call. You may now disconnect your lines. Thank you for your participation.