Staar's China Sales Rise 31% After Deferred-Order Base

The Tip Desk · November 11, 2026 · 4 min read

Third-quarter net sales were $83.4 million, up 21% from a $68.8 million base after stripping $25.9 million of 2025 deferred China revenue.

STAAR Surgical Company (STAA), the maker of EVO Implantable Collamer Lenses, reported third-quarter net sales of $83.4 million for the period ended October 2, 2026, down 12% from $94.7 million a year earlier. The year-ago quarter included $25.9 million of previously deferred China sales tied to an order placed and shipped in 2024. Excluding that revenue, prior-year sales were $68.8 million and the 2026 quarter rose 21%.

China, the company’s largest market, accounted for $39.3 million of the quarter, down 30% from $55.8 million a year earlier. Against the $29.9 million China base after removing the deferred sales, China grew 31%. The company said it was not yet able to meet lens demand in the third quarter, so the entire China sales increase versus the adjusted prior-year period came from higher average selling prices as mix shifted toward EVO+ and toric lenses. Distributor inventory in China ended the quarter below the company’s six-month target, and it said it is adjusting manufacturing capacity to close the gap.

Outside China, net sales were $44.1 million, up 13% from $38.9 million a year earlier. EMEA net sales increased 31% year over year, or 51% excluding the Middle East, after a 1% year-over-year decline in the second quarter. The company cited strong double-digit growth in Spain, Germany, the United Kingdom, and distributor operations, and a smaller Middle East decline than in the first half. Americas net sales rose 14%, led by $6.5 million of U.S. sales, the third consecutive quarter above $6 million.

Gross profit margin was 70.9% of net sales, compared with 82.2% a year earlier. The prior-year quarter’s margin included the $25.9 million of deferred China revenue recognized with no corresponding cost of sales, which lifted year-ago gross margin by 6.7 percentage points; excluding that revenue, prior-year gross margin would have been 75.5%. The company said third-quarter 2026 margin was also pressured by higher manufacturing costs from low second-quarter production volumes after the new ERP system went live, higher freight, tariffs on U.S. goods produced for China, and larger inventory provisions from expiring stock.

Operating income was $5.5 million, compared with $18.5 million a year earlier, a figure that included $25.9 million of gross profit from the deferred China revenue. Net income was $5.6 million, or $0.11 a share, versus $8.9 million, or $0.18 a share, a year earlier. Adjusted EBITDA was $14.4 million, or $0.28 a share; excluding the deferred China revenue, prior-year Adjusted EBITDA would have been $8.9 million, or $0.18 a share.

Total operating expenses were $53.7 million. Excluding $6.0 million of restructuring and merger-related costs in the prior-year quarter, operating expenses were flat. The company said it remains on track for a $225 million operating-expense target set at the start of the year. Research and development expenses were $10.5 million.

By the end of the third quarter, manufacturing of all ICLs destined for China had moved to the company’s Swiss facility, an initiative it said is expected to reduce exposure to tariffs on U.S.-origin products entering China. U.S. product already in inventory and sold to China remains subject to tariffs. Unit costs are likely to stay elevated for the rest of the year as STAAR sells through second-quarter production, but lower tariffs and smaller inventory provisions are expected to lift fourth-quarter 2026 gross margins above third-quarter levels. With both production facilities at full capacity, unit costs are expected to improve further in 2027.

Cash, cash equivalents, and investments totaled $206.4 million as of October 2, 2026, compared with $181.5 million at the end of the second quarter. The company has no outstanding debt. In September, the board authorized a share repurchase program of up to $50 million. First-in-human clinical trials for two next-generation presbyopia products are expected to begin patient enrollment in the next few months, subject to remaining regulatory authorizations.