InMode (NASDAQ:INMD) CFO Yair Malca said the company believes a multi-year downturn in demand is beginning to stabilize, with management expecting 2026 revenue to be flat after roughly two years of declining business. Speaking at a conference event, Malca emphasized that while pressures remain—particularly around margins—the company’s near-term focus is on building infrastructure to support a recovery, especially in North America.
Outlook: Expecting declines to stop, preparing for a recovery
Malca said InMode’s current message is that the company expects 2026 to be “flat” on the top line and expressed hope that “things will only get better from here.” He cautioned that the business may still see pockets of decline and growth depending on geography, but characterized the primary goal as stopping the decline and positioning the organization for improved demand.
North America reorganization and expanded commercial focus
Malca outlined changes to InMode’s North American organization aimed at strengthening execution. He said the company appointed a new president at the beginning of the fourth quarter and added two new vice presidents, creating what he described as a new “presidential suite” for the region. Malca said the company has provided the team with requested resources and is looking for the new structure to deliver results.
He also said InMode bifurcated part of its salesforce at the beginning of the year to focus on non-aesthetic—or “wellness”—segments. According to Malca, a dedicated team now focuses on the company’s eye care product, while also supporting women’s health and men’s health products in the U.S. The company views this as part of building a foundation in North America for growth when demand improves.
Expansion beyond aesthetics: women’s health, eye care, and potential ENT
Malca said InMode has expanded beyond traditional aesthetics into women’s health and into ophthalmology and optometry, with ENT identified as a likely next area “sometime next year.” In eye care, he said InMode currently has an indication to treat dry eye only in Canada and is conducting studies to pursue a similar indication in the U.S.
Malca said obtaining U.S. clearance for a dry eye indication could make it easier for the sales team to drive adoption and could lead to an uptick in sales, though he framed the timing as more likely “later this year or probably next year,” calling the latter “a more reasonable timeframe.” Until then, he said the company can sell to a degree but is limited without full clearance. He also discussed market structure differences, noting that in Canada dry eye is treated mainly by optometrists, while in the U.S. the ability of optometrists to treat dry eye can vary by state.
In women’s health, Malca said InMode is working on clinical studies around certain procedures and characterized the market opportunity as large—potentially larger than ophthalmology/optometry—while acknowledging these efforts may take more time.
Laser strategy: building a “one-stop shop,” with margin trade-offs
Malca described InMode’s push into lasers as a response to provider demand for combination treatments and competitive pressure. He said physicians often pair Morpheus8 treatments (targeting deeper layers of the skin) with laser procedures (more superficial resurfacing) to create a “3-D effect.” Malca said competitors have been calling on Morpheus8 customers to sell lasers, prompting InMode to broaden its offering.
He characterized laser as “pretty much a commodity nowadays” and said InMode’s goal is to become a “one-stop shop” so customers do not need to go to competitors for energy-based device needs. Malca said InMode introduced a CO2 laser last year, launched a Pico laser in the U.S. about a month before the event, and plans to introduce an Erbium laser later this year.
However, Malca said the strategy comes with gross margin pressure. He attributed this to the commodity nature of lasers, the cost structure of the technology, and competitive average selling prices. He said the impact is mainly on gross margin rather than operating margin, while noting the company prefers selling radiofrequency-based systems given higher profitability. Malca added that bundling RF devices with laser devices in a single transaction can improve the economics for InMode.
Capital allocation and business development approach
Malca said InMode continues to evaluate multiple capital allocation paths, including additional share buybacks, the possibility of a dividend, and M&A. He said M&A could support expansion into new areas such as women’s health, ophthalmology, or ENT, or strengthen the existing business. He also said the company may pursue distribution agreements—potentially exclusive arrangements—as a first step to add products to the portfolio, with the ability to acquire later if it makes sense.
On business model, Malca reiterated that in aesthetics InMode has not adopted a “razor and razor blade” consumables approach and said this has been an important part of the company’s success. In newer segments, he said InMode is currently maintaining the same model, but may consider changes over time as it learns what business models work best in those markets.
Margins, mix, and external factors
Malca said margin performance depends heavily on mix, noting that much of the decline has been driven by North America, which he described as the company’s most profitable region. He suggested margin improvement would be more likely if growth resumes in the U.S. He also said InMode is watching developments around tariffs, adding that if tariffs “go away for good,” margins could see some improvement, while declining to make specific commitments.
He agreed with the characterization that consumables volume improvements in the broader aesthetics market could precede a later recovery in system purchases—where InMode would typically see greater leverage.
Product cadence: Pico launch and new Morpheus8/laser console later in the year
On product cadence, Malca said the company launched the Pico laser in the first quarter and has begun selling it in the U.S., with orders being taken and deliveries expected to begin within weeks. He noted Pico is not a new technology and is commonly used for tattoo removal and skin treatments.
Later in the year, Malca said InMode expects to introduce a new version of Morpheus8 paired with an Erbium laser on the same console, though he said it will arrive toward year-end and he does not expect a significant contribution from that product in the near term. He added that the company typically aims to stay “within two platforms every year,” and indicated no other major RF-side console additions beyond those discussed.
About InMode (NASDAQ:INMD)
InMode Ltd. (NASDAQ:INMD) is a medical technology company headquartered in Israel that develops, manufactures and markets devices for aesthetic and medical treatments. The company specializes in energy-based technologies, primarily radiofrequency platforms, designed to deliver minimally-invasive and non-invasive procedures.
InMode’s product portfolio encompasses a range of modular systems targeting body contouring, facial rejuvenation, skin tightening and other cosmetic applications. Key offerings include devices built on proprietary radiofrequency and radiofrequency-assisted lipolysis, enabling physicians to perform treatments such as tissue coagulation, skin resurfacing and subdermal volumizing with reduced downtime.
The company distributes its technologies through direct sales operations and distribution partners, serving medical professionals across multiple geographies including North America, Europe, Asia Pacific and Latin America.
