RxSight at Morgan Stanley Conference: Navigating Market Challenges

On Monday, 08 September 2025, RxSight (NASDAQ:RXST) presented at the Morgan Stanley 23rd Annual Global Healthcare Conference, offering a strategic overview of its position in the cataract and premium intraocular lens (IOL) markets. While the company acknowledged a dip in cataract surgeries earlier this year, it remains optimistic about its growth potential, driven by the unique Light Adjustable Lens (LAL) and strategic international expansion.

Key Takeaways

• RxSight experienced a decline in Q1 2024 volumes but anticipates a return to normal trends.
• The company is restructuring its sales and clinical teams to better support LAL adoption.
• International expansion is underway, with regulatory approvals in Europe and South Korea.
• Private equity-backed practices are seen as potential growth drivers for premium IOL adoption.
• RxSight is committed to product innovation and customer support to maintain its competitive edge.

Financial Results

• Q1 2024 saw a drop in volumes due to macroeconomic factors and patient hesitancy.
• Q2 2024 indicated a potential return to normal trends, aligning with industry commentary.
• The company maintained a 10-11% share of the premium IOL market up until the last quarter.
• In 2024, 305 Light Delivery Devices were sold, nearing one-third of the installed base.
• LAL sales constitute a significant portion of RxSight’s revenue.

Operational Updates

• In July 2024, RxSight combined its LAL sales and clinical teams to enhance customer support.
• The company is investing in clinical and customer-facing teams to optimize LAL utilization.
• Regulatory approvals in Europe and South Korea are paving the way for early commercialization.
• Continuous product development aims to refine LAL technology and improve patient outcomes.
• Training initiatives are in place for optometrists, doctors, and technicians.

Future Outlook

• RxSight expects to grow within the market, supported by Medicare incentives for patient-pay procedures.
• The company plans to apply U.S. market insights to international expansion efforts.
• Focus remains on differentiating the LAL with superior clinical outcomes and personalized vision correction.
• 2025 will be a year of learning to optimize sales structures for LAL growth.

Q&A Highlights

• Macroeconomic factors were acknowledged as influencing patient decisions in early 2024.
• Private equity-backed practices are recognized as potential drivers for premium IOL growth.
• Increased competition in the multifocal IOL market is noted, with 25-30% of patients coming from multifocal options.
• International markets present significant growth opportunities, being the fastest-growing area for premium offerings.

Readers are encouraged to refer to the full transcript for a comprehensive understanding of RxSight’s strategic insights and market positioning.

Full transcript - Morgan Stanley 23rd Annual Global Healthcare Conference:

Unidentified speaker, Host, Morgan Stanley: I love happy as the next person. I think it’s probably time to kick off. Welcome. Thanks, everyone, for coming to the Morgan Stanley Healthcare Conference. Disclosures, MorganStanley.com/researchdisclosures. Very excited. What’s much more exciting for me is to have Ron and Shelley here from RxSight as the CEO and CFO respectively. Thank you so much for joining, guys.

Ron, CEO, RxSight: Thank you for having us.

Unidentified speaker, Host, Morgan Stanley: Why don’t we start high level with the market in total? Maybe, what do you think you’re seeing in the total, not specifically for you, but the total cataract market in terms of patient volumes, in terms of consumer spend? Any big picture commentary would be great as well.

Ron, CEO, RxSight: As I think everybody knows, the cataract market overall is the largest surgical market. As a U.S.-focused company, we’re focused on the U.S. portion of that market. At the beginning of this year, we saw something that we hadn’t seen for quite a while, which was an actual decrease in the overall cataract surgeries, even though the demographic trends would suggest that they should continue to grow kind of in the low single-digit numbers. I think it’s still, you know, why that happened is still open to interpretation. When you extend that over to premium, premium’s been a little bit more stable. I think that one interpretation would be that the demographic of cataract surgery, which is generally 60 and above, some portion of that was impacted either in a real sense by the macro environment or psychologically, perhaps by the change in administration that occurred during that timeframe.

In any case, we saw that downturn. We also saw a drop in our volumes in Q1. When we asked our doctors about that, they did report some patients either putting off surgery or trading down from premium to monofocal. I think that was definitely an effect continuing through Q2. As you’ve seen and as we’ve heard some of the bigger players in the market comment, maybe there’s some returning to what would be a normal trend from here on out. Do you want to add anything?

Unidentified speaker, Host, Morgan Stanley: Yeah. I mean, if you’d given me in Q1 $1 million to guess, I would never have guessed it would be monofocal, but was soft originally rather than premium. It was a bit of, at least to me, that was a bit of a surprise.

Ron, CEO, RxSight: I think that, I mean, of course, it’s always hard to come up with a reason why. You can always come up with a reason to explain something. It doesn’t tell you that it’s right. In the U.S., when you have a monofocal procedure, those patients are still paying some money out of pocket, about 20%, which turns out to be $400 or $500. For a large percentage of the population, that’s a meaningful amount. I think that certainly, and that would be consistent with potentially premium being less affected since that demographic is less affected. Certainly, over the last year or more, we’ve seen the LASIK market very significantly impacted by the macroeconomic headwinds. That, of course, is a younger demographic, which is much more susceptible to those effects. It doesn’t mean that the cataract or premium markets are impenetrable.

They can also be affected, especially when you have that level of impact in the other demographics.

Unidentified speaker, Host, Morgan Stanley: I never know how exactly accurate a picture the market scope data provides. We saw in Q2, we saw monofocal toric pick way back up again, and premium was actually okay. I mean, to your mind, you know, that monofocal toric, is that people on premium downgrading, or is that just the delayed procedures from Q1 in monofocal coming into Q2? That’s a very specific question.

Ron, CEO, RxSight: I think, of course, we love the folks at Marcus Scope. I think they do a good job. It is very difficult to make quarter to quarter, and sometimes we see those numbers change over time. I think I’d be cautious. If I were to step back, one thing that we’ve seen over a longer period of time is that toric has been a strong offering. I think that is consistent with other long-term trends in premium, which have been towards higher quality of vision. A toric lens, unlike a multifocal lens, provides the same overall level of quality of vision, lack of dysphotopsias, lack of glare and halo than a traditional monofocal. There is very little downside. There’s not that much upside, but there’s very little downside. That’s been an area that physicians have gravitated to.

I would say it mirrors their interest in LAL, which also obviously has very high quality. It also mirrors the effects in the multifocal world, which have moved from high levels of multifocality, which are associated with higher levels of visual phenomenon, negative visual phenomenon, towards lower levels of multifocality. We’ve seen that even in the most recent iterations of multifocal lenses, where all the three major players have all moved in that direction again. I think that just speaks to the level of importance that quality of vision plays for patients, especially as cataract surgery moves into a younger demographic, as patients increasingly decide to have cataract surgery at an earlier age. We’ve seen that over the last 10 years, drop about three or four years as the mean age of cataract surgery.

Those patients are going to be more susceptible to quality of vision issues because they’re starting with less of a cataract and therefore more quality of vision. They will notice a drop in quality more.

Unidentified speaker, Host, Morgan Stanley: That’s really interesting. I mean, the other dynamic that’s been happening for a long time, but it’s happening again in 2026, is Medicare’s relentless battering of monofocal reimbursement to the point where the nerdy forums that I follow, you know, the docs are just like, this is getting ridiculous. Do you think that has encouraged people to switch a little bit, have that little extra conversation of getting their patients into toric, but also for you guys, because you get a decent amount of patients who would have been monofocal flipping into an LAL? How helpful is it that the economics of that barometer just dropped down even more?

Ron, CEO, RxSight: I mean, I think it’s an absolute driver of premium. Practices simply cannot survive. Physicians cannot maintain their income levels unless they’re converting patients. The good thing about, you know, especially, you know, obviously we feel with our technology is they’re delivering such a better outcome. A toric lens does deliver a better outcome for patients who have moderate to higher levels of astigmatism. That’s a relatively small % of the market. The % that the bulk of patients who are having a monofocal lens are not going to be, you know, significantly impacted.

Whereas by offering the Light Adjustable Lens, which offers not only a higher degree of distance vision uncorrected, that’s, you know, significantly superior than what you can achieve with a monofocal lens, it also allows the patient and the doctor to titrate the vision in both eyes, a process called blended vision, which is still the most common and we believe the most efficacious way to address presbyopia.

Unidentified speaker, Host, Morgan Stanley: When you’re thinking about earlier this year, when we discussed some of the macroeconomic headwinds and that side of things, do you think it sounds like consumer commentary went towards the back end of that, maybe that there were fears around tariffs that were scaring people, but the confidence has returned? Is that something that you feel in the base business? Do you feel like the consumer is getting a little less skittish?

Ron, CEO, RxSight: I don’t know that we, you know, I don’t think we can per se comment on the entire market. We follow obviously what the big players like Alcon say, and that certainly seems to be their sentiment. As a person who’s in that age demographic, I mean, certainly when you’re faced with a lot of change, it’s natural to kind of pull back. Over time, people are adaptable and they will normalize situations. I think we’re probably in that phase.

Unidentified speaker, Host, Morgan Stanley: You know, one of the other trends that’s happened in this industry for a while has been like the private equity-backed ophthalmology practices have been hoovering up a lot of clinics pretty aggressively over time. You know, again, as a customer base, they’re pretty heavily incentivized towards patient mix. Do you see a discernible difference in the customers that you have that are private equity-backed and the proportion of premium intraocular lenses there versus not? When they take over a practice, do you find that they’re pushing that mix in a favor that’s useful for you, or is it just agnostic between?

Ron, CEO, RxSight: Ophthalmology premium is, I haven’t looked specifically at that. Maybe Shelley, you have, but the premium, I’m sorry, the private equity represents roughly 20% or 30% of ophthalmic practices. The traditional argument for private equity where they can ring out costs and make things more efficient, it’s hard to make that argument in an ophthalmic practice. I always say that there’s nothing more efficient than a single, you know, an ophthalmologist-run practice because they don’t have a salary. They’re doing their own management. It’s very hard to be more efficient. I think that that’s what the private equity firms have identified is that for them to really improve profitability at these practices, they have to do the things that make sense, like converting as many patients as possible to premium.

I think increasingly, those private equity-driven practices recognize that the Light Adjustable Lens is a great way to do that because it’s a way to deemphasize the individual surgeon, although the surgeon is obviously still very important, but to disseminate the responsibility for that premium growth to a wider group of people, not only the surgeon, but also their optometric colleagues, the technicians, and refractive surgery, and refractive counselors within a practice, which you can argue that a private equity-run practice is, you know, perhaps more focused on than not.

Unidentified speaker, Host, Morgan Stanley: That makes sense. One of the things that came up in the Q2 was the newer docs on the platform for, you know, the Light Adjustable Lens. The utilization curves were looking a little bit different from some of the original docs. Maybe just to sort of level set the room, it’d be helpful if you could kind of give people a sense of what’s going on there, what the pathway forward is, and how that looks to you guys.

Ron, CEO, RxSight: Do you want to give the overall picture?

Shelley, CFO, RxSight: Yeah. We’ve talked about this before. Even though this is an output number, what we saw among our classes of 2023, 2022, and then 2021 and prior, while they are a very small M as a class, they grew at about the same rate, 2023, you know, faster than the earlier classes. That kind of made sense to us. What we saw in the class of 2024, we saw it more in the first and second quarters of 2025 because you have to have enough time in grade to really see a trend. What we saw in that trend is, one, they weren’t adopting as quickly, not nearly as quickly as, say, the class of 2023, which was pretty good. When they went down, they went down a bit more than the other cohorts.

If you think about it, the other cohorts kind of flattened out, with all the things Ron has talked about, just the macro environment, and then they started to drift down. If you think about our procedure growth, the class or the number of Light Adjustable Lenses for Light Delivery Device, we sold 305 Light Delivery Devices in 2024. That’s approaching a third of our install base. They have an outsized impact on the business overall. Let Ron talk about this, but we think they’re a slightly different customer, right? We did so many installs in 2024. If you look at what we had and where we’re going, and Ron can certainly talk about that, the focus of the company was selling Light Delivery Devices. We had a Light Delivery Device sales force, and we had a Light Adjustable Lens sales force, right? They reported under the same structure.

We have a clinical group, which is about a half, almost a half of the 200 people we have that are field-facing. They’re focused on getting new customers up and running, right? From a clinical viewpoint, training in the OR, everybody’s got a little bit different injector. Then training the practice, the ODs, and the doctors on the use of the Light Delivery Device, right? Proctoring for cases. That focus was really on the newer customers. What we’re seeing is that the newer customers needed something different. A lot more from our Light Adjustable Lens salespeople in terms of practice conversion or practice flow, and more from our clinical people, right?

Even though that was our focus, getting the new customers up, what we have decided, and we’ll talk about that hopefully in another bit, is by combining our LAL salespeople with the exact same accounts and territories as our clinical people in our test cases that we ran in the first and second quarter. What we did see is we could grow accounts by doing that. We made the entire change in the organization in July to do that. We think it’s a positive move, but it’ll take some time for that, hence our guidance as well. Do you want to add to that, Ron?

Ron, CEO, RxSight: No, yeah, and I think it applies not only to, you know, our more recent customers, but it also applies to historical customers as well. Because, you know, it’s been four or five years that they’ve had our system, and there’s always change that goes on in a practice. Doctors retire, staff leave, they need to be newly trained. As Shelley mentioned, we were certainly over the last few years, definitely got into a mode of install, onboard, go to the next one, install, onboard, go to the next one. Now, we certainly recognize the need to make sure that that practice is well-versed and continues to be supported as they continue to adopt the technology, which occurs over a longer period of time.

Unidentified speaker, Host, Morgan Stanley: To your point, you know, I remember when we were talking about the LED originally, and the whole reason you don’t lease it is that you want emotional buy-in from having bought a system. To your point, if you then have churn in that customer, the new person may not have that emotional buy-in. They need the clinical support to kind of encourage. Is that what we’re talking about?

Ron, CEO, RxSight: Absolutely. The number one thing that we do is to demonstrate and optimize the clinical value of the product. That requires, you know, it’s not a difficult skill set. We’re not teaching them how to do a different surgery, but it is a clinical expertise. It’s an expertise that’s distributed throughout the practice. The post-operative adjustments or post-operative optimization of vision is not something that people did in cataract surgery. It didn’t exist five years ago. There is an expertise that’s associated with that. Many of our initial customers came from the refractive surgery world; they picked that up very quickly. As their practice develops, as we get into new practices, there are different levels of pre-existing knowledge. We’ve learned a lot on how to optimize the process, make it efficient, make it more successful, consistently.

That’s something that, you know, they’re not huge clinical techniques, but they’re pearls of wisdom that have been picked up over the last four or five years that needed to be systematized and brought to the attention of a larger customer base.

Unidentified speaker, Host, Morgan Stanley: How should we think about, therefore, the incremental investment that goes into supporting those customers? Is it just like, you know, is it a question of allocating, to a point, the reps more effectively, or do you think you need, per account on average if you like, a broader sales force?

Ron, CEO, RxSight: We certainly add to what I would call our clinical or our customer-facing team as our install base grows, and that will continue. Now, you know, what that number, you know, what those metrics ultimately turn out to be, obviously, as you continue to penetrate the market, a lot of the skills that I’ve been talking about become part of the just broader clinical expertise of the field. While we’re still growing, which we still have this very significant potential for, we’ll continue to add. I don’t know if you want to add.

Shelley, CFO, RxSight: No, we’re always adding clinical people. I think the organization is different as well. If you go back to the beginning of time, we had to sell LEDs, and we had those sales forces combined because the focus was on selling LEDs. We were very successful at it. Now LALs are a larger percentage of our revenue by quite a bit. It is a change in structure, and it’s more nuanced, but it also allows for a better closed feedback system because you’ve got your salespeople for LAL matched with a clinical force that’s the same, right? They’re not being pulled into other territories or to other accounts. You’re going to be able to see, you know, we’re leaving time in our guidance for that to happen through 2025. What programs and tactics work best for each customer?

How do we select those customers that we’re going to go after first, right? We’re not going to hit all 1,100+ accounts this year, right? I think that we can discern what works best in this structure for us and learn something, you know, throughout 2025 about what’s going to be most effective to grow LAL growth. Also, since LED absolute number of installs fell in the second quarter, that’s related to their peers, right? They’re not going to go get a reference from somebody who was installed three or four years ago. They’re going to go to a reference that was installed last year and say, "How are your patients doing clinically?

How are you doing economically?" We think that as those customers did not ramp as quickly, it did not give potential customers the same level of confidence to invest in the LED because you can always wait, right? We think it’s a circular argument on LED sales.

Unidentified speaker, Host, Morgan Stanley: Yeah, that was like a mouthless.

Shelley, CFO, RxSight: Right. You need to get our LAL sales up in absolute numbers. That’s what I look at. Some people look at the number of LALs per LED. Going out into the future, we’ve said it’s nominal this year and probably pretty nominal next year is international because we’ve gotten a number of approvals this year as well. That’ll give us an expansion base, but we’re also careful about providing that guidance because just like the U.S., people want to see their KOLs perform well. Of course, we’ve got a lot of clinical data here in the U.S., but they want to see their own KOLs get the same results both clinically and economically.

Unidentified speaker, Host, Morgan Stanley: Makes sense.

Shelley, CFO, RxSight: That is another growth factor for us out in the future.

Unidentified speaker, Host, Morgan Stanley: I definitely want to hit on that. I mean, as we’ve sat here, I’m looking at the EKG little symbol behind you guys on the screen, and it sort of reminds me of the premium IOL market because a lot of the time, the new shiny, exciting keys come in and people trial it and then they flip back and things like that. How for you guys, how disruptive or not do you think it’s been having, you know, there was Odyssey and then there’s Envy and then BDI has got Finder, like all these little different extra distractions, whereas I think there was a window where it was, apart from maybe Symfony, there was a window where it was really just PanOptix and Vivity, if you know what I mean. It was quite, there was just less noise.

Is that noise really affecting you or am I on the wrong track?

Ron, CEO, RxSight: No, I think that’s a correct observation. There was this kind of tax alcana for the last four or five years, which kind of tamped down competition. As Bausch + Lomb and Johnson & Johnson, primarily in the U.S., have introduced competitive products, I think now the products are quite similar. They’ve all kind of gone in that same direction that I mentioned earlier. That has made the overall space more competitive, which, you know, it’s mainly between those players, and you see share changes between those players primarily. It has an impact on us. About 25-30% of our patients come from multifocal patients who otherwise would have gotten multifocal IOLs. If you have more competition in that space, there’s going to be more competition with us as well. I think that runs a course, and we’ll see how things, you know, you can only incentivize things for so long.

At some point, you have to make money.

Unidentified speaker, Host, Morgan Stanley: Yeah, people will try stuff and then eject after a while. I do want to hit on our U.S., because obviously you guys are an extremely U.S.-focused business. I know you’ve done work on Canada and that side of things, but how are you thinking about that kind of midterm, the opportunity set, the investment? You know, because to your point, there needs to be some support. People, you want them to have a good experience for that word of mouth. You know, conceptually, I think I’m sure that they understand that the lens, you get a lot of the positive feedback in the U.S. that probably helps quite a bit. How do you see that those markets being different? Where would you focus? What are the, how do you see that opportunity long-term?

Ron, CEO, RxSight: We’re fortunate again that we’re following in the path of premium overall. About 80% of premium lenses are OUS, primarily. The U.S. is the largest market, but four out of five lenses that are premium are outside the U.S., primarily in about 20 countries, the major economies of Europe and Asia. That’s where we have focused our resources for regulatory approval, as Shelley mentioned. We had to go through the EU MDR process, which we completed, and have started early commercialization in Europe. We similarly got our approval in South Korea in the spring and have started there as well. Some of the Southeast Asian countries, the Asian countries where there’s a relatively quick approval. We’re in the process in the other major economies. I think there’s a big opportunity. It’s been the fastest growing area of premium for the other companies. Ophthalmology ultimately is a global field.

I can walk into an ophthalmology office or an OR anywhere in the world, anywhere in the developed world, and it’s essentially very similar. As Shelley said, it’s important for each country to have success. We will certainly leverage the learnings that we’ve had in the U.S. to support customers and develop the clinical data in those markets, and develop the clinical expertise both amongst physicians as well as our own staff so that can be done successfully and sustainably.

Unidentified speaker, Host, Morgan Stanley: I remember when premium IOLs were all trialed in Europe first because the CE market was so easy before they put MDR in and blew it all up themselves in Europe. That actually created a very fragmented market in some ways in Europe. Is that a little bit easier to then tackle? I know the countries are fragmented, but even within them, the positioning is a little rather than the kind of initial monolith on the U.S. side where you had one peer that had like 70%, 80% of the share. I’m just, that’s obviously just the premium side. Is it a little easier when it’s fragmented on the competition or no different?

Ron, CEO, RxSight: I don’t think it’s easier. It’ll be different, but I think that, you know, Europe in particular, they have a lot more choices of different IOLs. It’s, you know, we’re definitely a differentiated product, but there’s a lot more just other products out there. I think that, you know, that’ll be an, you know, we’ll need to make that case as we did in the U.S., focusing on, you know, KOLs in an individual market, building up a set of data that they can reference both economically and clinically. I think that, you know, we’re well positioned to do that.

Unidentified speaker, Host, Morgan Stanley: Is the OUS a little less litigious, to make a stereotype? You know, is there a difference in risk tolerance of dysphotopsias, U.S. versus OUS, or ultimately you just don’t ever want your patient to be unhappy and so it doesn’t really make a difference?

Ron, CEO, RxSight: I think that, you know, globally, we’ve seen different levels of success of multifocal lenses. The same trends, you know, there’s been this movement to less multifocality, actually led OUS. I think that that bodes well for us. Again, we’re going to, you know, we’re going to need to establish ourselves in each market.

Unidentified speaker, Host, Morgan Stanley: Shelley, you have an unenviable job of providing guidance in a challenging market, challenging a lot, volatile, which makes things tricky. When we were updating our numbers, I remember looking at 2026 and just being like, "I have no idea what to put in here. I want to do this." That’s not your fault. I have no idea. Do you guys feel like we should think about this business as base intraocular lens market growth and then RxSight can continue to take share and work on Greenfield OUS and should be structurally above that, maybe to be specific in terms of Light Adjustable Lenses? Is that a fair just starting benchmark to think about the business? Just even just conceptually, I know you don’t want to guide the way through.

Shelley, CFO, RxSight: I think that when we look at market share, up until last quarter where we stayed about equal at 10%, 11%, if you look at the premium market defined by the premium IOLs, the toric IOLs, and our cell, right? Toric, as Ron mentioned, has been 50% or greater of that overall premium market. They have done a good job in studying it. If you pull us out, the market has been flat to a little bit shrinking, right? We have been the growth factor in the market. We think in the long term, we should be, right? There is an opportunity for doctors who are not doing premium or not a lot of premium to get into the market and be able to say to their patients, "We have a reliable way of getting you to the vision I’m promising you," rather than predicting it, right?

Your choice, if you do not get what you want, is to wear glasses. In some instances, the patients opt for another procedure, which is LASIK, but that doctor also has to have LASIK in the practice in order to do that. We think that the market, we are a grower in the market because 40% of the patients come from patients who would have otherwise gotten a monofocal. We think that we have some wind at our back, right? Medicare provides the wind at the back for all of us, right? Unfortunately. For doctors, they really do have to go to a patient-pay procedure. LASIK, as Ron mentioned, has just plummeted, right? That is the demographic and the fact that you can put it off pretty much forever, right? We have seen some effects, but not as much. Demographics work for us.

That is definitely a wind in our back as well. Just the fact that people get 92%, 94% of patients get to 20/20 at distance and comparable at near. That is a tremendous opportunity for the company. Also, doctors make more money with that, and they can more reliably sell to their patients and also sell quality of vision. Ultimately, the market should grow, and ultimately we should be a factor in that growth.

Unidentified speaker, Host, Morgan Stanley: 40 years on, and I’m still dodging LASIK. Let’s see if I can keep it going. Ron, Shelley, thank you so much. Perfect timing. I really appreciate it.

Shelley, CFO, RxSight: Thank you so much.

Ron, CEO, RxSight: Thank you.

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