Ladies and gentlemen, good afternoon. My name is Abby, I will be your conference operator today. At this time, I would like to welcome everyone to the Eargo first quarter 2023 earnings conference call. Today's conference is being recorded all lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press the star key followed by the number one on your telephone keypad. If you would like to withdraw your question, simply press star one once again. Thank you, I will now turn the conference over to Nick Laudico, Chief Retail Officer. You may begin. Thanks, operator. Good afternoon, everyone, and welcome to the Eargo first quarter 2023 earnings conference call. As a reminder, this call is being broadcast live and a digital replay will be available on our IR website. Joining me on today's call are Christian Gormsen, President and Chief Executive Officer, and Adam Laponis, Chief Financial Officer. Before we begin, I'd like to remind you that some of the matters discussed in the conference call will contain forward-looking statements regarding future events, as outlined in our press release today. We wish to caution you that such statements are based on management's current expectations and beliefs, are forward-looking in nature and are subject to risks and uncertainties, and actual events or results may differ materially. The factors that could cause actual results or events to differ include, but are not limited to, factors referenced in our press release today as well as our filings with the SEC. Before turning the call over to Christian, I wanna make note that we have posted a historical GAAP to non-GAAP reconciliation table on our IR website in the events and presentation section. With that said, I will now turn the call over to Christian. Thank you, Nick, and thank you everyone for joining us today. Through the first quarter of 2023, we continued to make progress on evolving Eargo into a true omnichannel business. Retail once again led the way in our efforts to diversify our business growth. With our direct to consumer cash pay business seeing increased efficiency as we continue to refine our media spend. While still early, we also continue to pursue opportunities to expand our presence in the insurance market. Our first quarter volume growth, combined with our continued capital efficiency initiatives, led to increased gross margins, reduced operating expenses, and a lower net operating loss. We believe the worst of the uncertainty impacting our business is behind us, enabling us to make incremental steps in the right direction each quarter. As such, we believe that quarterly net operating cash burn will continue to see modest sequential improvements in the remaining quarters of 2023. Moving to a summary of our first quarter business performance. First quarter net revenue was $11.8 million, up approximately 29% year-over-year and slightly down on a sequential basis. As a reminder, Q1 is typically a sequentially down quarter following the end of heightened holiday promotional activity in Q4. First quarter gross shipment growth was primarily driven by sales to Victra, our largest retail partner. In the first quarter, Victra submitted an initial stocking order of Eargo 7 hearing aid devices in addition to subsequent replenishment orders. Since announcing our nationwide partnership with Victra last fall, we have been pleased with the early progress in this new channel. Victra reports that Eargo devices continue to sell through Victra's approximately 1,500 retail locations. This positive trend gives us confidence in the future growth potential of the partnership. We continue to support our retail partners by training and educating their sales staff on how to communicate with consumers about the key differentiators of Eargo devices. With respect to our partnership with Victra, our focus for the remainder of 2023 is to continue training and education of the Victra sales force, gathering customer feedback and improving the overall customer experience. From a direct to consumer cash pay perspective, our focus has been on media spend efficiency, and we continue to make incremental improvements to the cost of acquiring a customer as we refine our strategy and continue to optimize our media channel spend. Turning to a brief update on insurance access. As we shared on our last call, we're currently accepting both FEHB and non-FEHB insurance as a method of direct payment in certain limited circumstances. In particular, when customers have undergone additional testing by a licensed healthcare provider to establish medical necessity with supporting clinical documentation. In the meantime, we expect to continue to operate at low insurance volumes and believe meaningful volume lift will take some time. Before turning it to Adam, let me touch on Eargo 7, our seventh generation device and an example of our long-standing commitment to innovation. We were thrilled to announce Eargo 7 earlier this year at CES, followed by a full commercial launch in mid-February. Since then, the device has been available for purchase across all channels. We have been pleased with both the initial device uptake so far, which has tracked well to our expectations and the positive customer feedback. Specifically, Eargo 7 has received better overall customer reviews and reduced connectivity complaints versus prior Eargo devices. Following receipt of 510(k) clearance from the FDA last quarter, Eargo 5, Eargo 6, and Eargo 7 can each be marketed as self-fitting hearing aids with the use of Sound Match via our mobile app. Each is currently marketed as over-the-counter pursuant to the FDA's new OTC regulatory requirements. With our self-fit technology, Eargo 7 does not require traditional in-office visits for fitting or adjustments like other hearing aids. This benefit has really resonated with customers so far in our retail and direct-to-consumer settings, as they're able to get set up and personalize their devices at home quickly and easily. We're incredibly proud of our first quarter results, especially in the context of an evolving hearing aid industry. We believe that the distribution of hearing aids in the U.S. through the physical retail channel will continue to grow, and believe we are one of the leaders in this market evolution. Let me now turn it over to Adam for a more detailed summary of our first quarter financial and operating results. Thanks, Christian. Given Christian's summary of net revenues, I will begin my commentary at the growth shipment line. First quarter growth system shipped were 8,705, up approximately 51% year-over-year and roughly flat sequentially. The year-over-year increase in growth system shipped was primarily driven by sales to Victra. As Christian noted, first quarter net revenue was $11.8 million, up approximately 29% year-over-year, and slightly down on a sequential basis. We derived approximately 22% of our net revenue in Q1 2023 from sales to Victra. It is important to note that our shipment volume in both the fourth quarter of 2022 and the first quarter of 2023 were impacted by large stocking orders from Victra as they made significant purchase to build and maintain inventory levels at their approximately 1,500 retail locations. Going forward, we may not be able to accurately predict the timing or size of any future Victra orders, which may impact our net revenue and the consistency of our results on a sequential basis. The first quarter 2023 sales return rate was 37.4%, up 3.5 percentage points year-over-year and 2.5 percentage points sequentially. The increase in the sales return rate was primarily driven by a sales channel mix shift, given the larger percentage of sales attributed to our retail partner, Victra, where we have only recently implemented sales return reduction initiatives. These initiatives are similar to those implemented in our direct-to-consumer cash pay channels years ago, which ultimately reduced and stabilized our sales return rate into the mid-thirties. We hope to achieve similar benefits from these initiatives in the retail channel over the coming quarters and therefore believe the higher actual sales return rate experience in the first quarter is transient. Moving to non-GAAP gross margin and non-GAAP operating expenses. Our discussion of financial metrics in the gross margin line below will be on a non-GAAP basis, which excludes stock-based compensation expense. Please refer to our GAAP to non-GAAP reconciliation included in today's earnings release and the historical GAAP to non-GAAP reconciliation table on our IR website in the Events and Presentation section. First quarter non-GAAP gross margin was 43.8% compared to 40.5% in the first quarter of 2022. We are pleased with our ability to expand gross margins consistently as we continue to scale volumes. Moving to operating expenses. While we continue to refine our cost structure, we have invested selectively in areas we believe will be the future drivers of our business, including insurance and retail, as well as the supporting compliance infrastructure. First quarter non-GAAP sales and marketing expenses were $12.5 million or 100.5% of net revenues, compared to $12.6 million or 137.9% of revenues in the first quarter of 2022. Non-GAAP research and development expenses, $3.9 million or 33.5% of net revenues, compared to $4.9 million or 53% of net revenues in the first quarter of 2022. The decrease is primarily due to lower personnel-related costs and lower third-party costs. Non-GAAP general and administrative expenses were $8.1 million or 68.5% of net revenues, compared to $13.6 million or 148.1% of net revenues in the first quarter of 2022. This decrease was primarily due to a reduction in professional fees, partially offset by an increase in personnel and personnel-related costs. Non-GAAP net operating loss for the first quarter of 2023 was $19.4 million, compared to a non-GAAP net operating loss of $27.4 million for the first quarter of 2022. Moving to the balance sheet. We had cash and cash equivalents of $79.8 million at March 31st, 2023. This compares to $101.2 million as of December 31st, 2022. Our net operating cash burn, which we define as cash used in operating and investment activities in the first quarter of 2023, was approximately $21.5 million. Now turning to cash burn guidance. The company expects modest sequential improvements in net operating cash burn in the remaining quarters of 2023. We are not providing any further financial guidance at this time. I will now turn it back to Christian for closing commentary. Thanks, Adam. When we last spoke with you in March, we ended on a note of optimism with a belief that we were well-positioned to capitalize on our recent progress in 2023 as we work to return Eargo to growth mode. Standing here today with the first quarter of 2023 now behind us, I'm pleased to report we have even greater confidence in our ability to transform our business and execute our omnichannel strategy. We believe that the first quarter demonstrated momentum in our business, laying the groundwork for further Eargo success. While we clearly have work to do, we do believe the worst of the uncertainty impacting our business is behind us, enabling us to make incremental steps in the right direction each quarter. Most importantly, we remain steadfast in our belief that Eargo is driving a revolutionary change in the hearing industry, backed by innovative technology and robust remote customer care. There remains a very large and unpenetrated market opportunity for us to capitalize on, particular in direct to consumer. We look forward to providing future updates on our progress over the course of 2023. I will now turn the call over to the operator for Q&A. Thank you. At this time, I would like to remind everyone, in order to ask a question, press star and then the number one on your telephone keypad, and we will pause for just a moment to compile the Q&A roster. We will take our first question from Margaret Kaczor with William Blair. Your line is open. Hey, good afternoon, guys. Thanks for taking the question. I wanted to start with Victra, and I apologize, I've got a series of questions. Can you give us a sense of, I guess, how many Victra stores at this point have an Eargo device, given the stocking dynamics? Is that largely behind us? Then, you know, you mentioned that most of the sales were stocking, but you're clearly seeing an increase in return rates, meaning that they seem to be selling some of these devices and re-hopefully replacing some of the sales. I guess, can you give us a sense, at least based on the return rate, how much that may suggest for sell-through, you know, either as a percentage or as a number versus the sell-in? Thanks, Margaret. Let me start here. I'll see if Adam has some more details that you're looking for. At the highest level, we've sold into all Victra stores. All 1,500 have, you know, inventory of Eargo. You can get Eargo 7 at any Victra Verizon store, assuming they haven't just recently sold out. There is also a replenishment system set in place. That is completely behind us in terms of getting that initial stocking there. We've also seen in terms of development, you know, we've clearly seen more sell-through in Q1 than what we saw in Q4. We are seeing, you know, Q-over-Q improvements in the sell-through. Obviously, it's being masked to that level about the actual sell-in of inventory, which is what we're reporting on financially. Adam, anything, any further color? I don't think we have further color to give, right? I think Christian, you said it well, Margaret. We did see sequential improvement in the sell-in and sell-through, but the sell-in still exceeded the sell-through even in Q1. Yeah. Was that true in maybe March. I'd say, well, again, it the orders were don't come in on a week to week. They came in in pretty big months, it's kinda lumpy in that regard. I'd say the average orders in March and the average order of sell-in in Q3, we're getting closer, but we're still not there yet. We're So we're still in that dynamic of building up inventory in Q1, I'd say your question of is it done, at this point, we're at a steady state now, where we've got inventory in every store, and we are seeing continued momentum in sell-through. In terms of RFC dynamics, yes, we are seeing a increase in RFCs, we are seeing that sell-through. We're also now implementing the trainings across the country that, and the other actions that we think, we did back in the, you know, 2018, 2019 that can positively impact that RFC rate over time. Okay. You know, moving to that return rate, can you give us a sense of how quickly those initiatives maybe did help the DTC business? You know, was it a matter of quarters or years? You know, if you could remind us as well, the current generation of Eargo devices. I believe that despite the high return rate, you can still reuse those devices, so the impact on gross margins may be a little bit less than it's been in the past. Is that true? Yep. Let me give you kinda the two-part there, Margaret. The first part is, when we did this back in 2018 to 2019 over the course of four quarters, we saw a 10-point reduction in return rates from the mid-40s to the mid-30s in that time range. I think that's probably a decent proxy for the kind of times we're expecting things to move here. It will take quarters, but it won't take years. In terms of the, we call it refurbishment capabilities of our products, we are able to refurbish all the Eargo 5, Eargo 6, and Eargo 7 lines that get returned to us. It does minimize that impact to gross margin when there is a higher return, but we're still sensitive to it from both the customer experience as well as there is still some cost associated with that rework. Okay. Yeah. Two more questions. You know, number one, on the Victra experience, obviously you're seeing some success there. Does that suggest you may wanna expand these types of partnerships? If so, why? If not, you know, what metrics do you need to see to want to expand any further? Yeah. No, let me grab that. Clearly, we believe that the best way to grow hearing penetration, which is the overall goal and the mission of Eargo, helping more people hear better, is to meet people where they are. I think we're getting strong feedback that those people are in locations like Victra, Verizon stores. That basically is the whole strategy that we're building on. It's also clear that it's a new location. People are not walking into a Verizon store expecting to buy a hearing aid, so it is that journey of educating, you know, consumers that you can actually now get a health product in such a location. I think that's part of, you know, driving obviously the sell through, not the sell-in, and also managing the return rate and managing people's expectations. As we've always said, this is a long-term initiative. It's a long-term strategy for us, but it's something we are as committed to, as Adam also mentioned, it's an area that we are actively investing in our organization's capability to support into. We've continued investing, you know, through the quarter here, and we'll continue to do so through the rest of the year. Absolutely. The KPIs we'll be looking for is ultimately not the sell-in, it's the sell-throughs, you know, combined with the return rates. Ultimately, the most important is the customer experience. So far what we're learning is customers did not expect it, but they appreciate that opportunity. It's a journey that we have literally just embarked on, but we're excited about for the future. Okay. Last question. you know, you mentioned most of the increase in sales, seems to be from Victra, but can you give us a sense around, DTC growth on a year-over-year basis, and then how that might change with the latest Eargo 7 launch, and any potential marketing expense that you may have? Thank you. Yes. Margaret, when you look at the 20% of revenue coming from retail, you can kind of back into it, is that, you know, year-on-year, we're essentially between the repeat business and our existing DTC business. We're roughly flat and even slightly down, depending on how you cut it. To me, there's we are focused on optimizing it, and that's really where you're seeing the improvement in sales and marketing and driving that first and then building off any growth from there. We are seeing, though, that there's cross-pollination effect. You know, a customer goes into Victra and creates a lead that they can convert in online or the phone and vice versa. A customer that goes on the phone can then go into Victra. The two are co-mingling each other as well, and that's a phenomenon we want to see, but we expect to see more of that as we go forward. Great. Thank you guys. Thank you. Ladies and gentlemen, this concludes today's conference call, and we thank you for your participation. You may now disconnect.