10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: June 30, 2023

Or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number: 0-11634

STAAR Surgical Company

(Exact Name of Registrant as Specified in its Charter)

Delaware	95-3797439
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)
25651 Atlantic Ocean Drive Lake Forest, California	92630
(Address of Principal Executive Offices)	(Zip Code)

(626) 303-7902

(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common	STAA	NASDAQ

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☑	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

The registrant has 48,499,892 shares of common stock, par value $0.01 per share, issued and outstanding as of July 28, 2023.

STAAR SURGICAL COMPANY

INDEX

		PAGE NUMBER
PART I – FINANCIAL INFORMATION		1
ITEM 1	FINANCIAL STATEMENTS	1
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	17
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	23
ITEM 4.	CONTROLS AND PROCEDURES	23
PART II – OTHER INFORMATION		23
ITEM 1.	LEGAL PROCEEDINGS	23
ITEM 1A.	RISK FACTORS	24
ITEM 4.	MINE SAFETY DISCLOSURES	24
ITEM 5.	OTHER INFORMATION	24
ITEM 6.	EXHIBITS	25

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

STAAR SURGICAL COMPANY

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except par value amounts)

(Unaudited)

	June 30, 2023			December 30, 2022
ASSETS
Current assets:
Cash and cash equivalents	$	94,695		$	86,480
Investments available for sale		97,312			125,159
Accounts receivable trade, net of allowance for credit losses of    $31 and $20, respectively		94,442			62,447
Inventories, net		25,482			24,161
Prepayments, deposits and other current assets		16,072			13,476
Total current assets		328,003			311,723
Investments available for sale		17,525			13,902
Property, plant and equipment, net		55,924			50,921
Finance lease right-of-use assets, net		257			342
Operating lease right-of-use assets, net		31,530			30,270
Intangible assets, net		—			173
Goodwill		1,786			1,786
Deferred income taxes		4,672			4,824
Other assets		954			957
Total assets	$	440,651		$	414,898
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	11,441		$	11,576
Obligations under finance leases		162			169
Obligations under operating leases		4,013			3,524
Allowance for sales returns		6,653			5,706
Other current liabilities		31,925			30,741
Total current liabilities		54,194			51,716
Obligations under finance leases		125			210
Obligations under operating leases		28,189			27,136
Deferred income taxes		1,295			1,489
Asset retirement obligations		101			220
Pension liability		3,050			1,935
Total liabilities		86,954			82,706
Commitments and contingencies
Stockholders’ equity:
Common stock, $0.01 par value; 60,000 shares authorized: 48,499 and    48,212 shares issued and outstanding at June 30, 2023 and    December 30, 2022, respectively		485			482
Additional paid-in capital		419,594			404,189
Accumulated other comprehensive gain (loss)		(2,521	)		156
Accumulated deficit		(63,861	)		(72,635	)
Total stockholders’ equity		353,697			332,192
Total liabilities and stockholders’ equity	$	440,651		$	414,898

See accompanying notes to the condensed consolidated financial statements.

1

STAAR SURGICAL COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share amounts)

(Unaudited)

	Three Months Ended						Six Months Ended
	June 30, 2023			July 1, 2022			June 30, 2023			July 1, 2022
Net sales	$	92,306		$	81,101		$	165,834		$	144,301
Cost of sales		21,580			17,229			37,546			31,165
Gross profit		70,726			63,872			128,288			113,136
Selling, general and administrative expenses:
General and administrative		18,097			13,983			36,195			25,923
Selling and marketing		32,277			24,233			58,631			41,503
Research and development		11,755			8,636			22,065			16,577
Total selling, general and administrative expenses		62,129			46,852			116,891			84,003
Operating income		8,597			17,020			11,397			29,133
Other income (expense), net:
Interest income, net		1,775			43			3,597			37
Loss on foreign currency transactions		(1,890	)		(1,860	)		(1,856	)		(2,775	)
Royalty income		—			177			—			450
Other income, net		10			89			73			151
Total other income (expense), net		(105	)		(1,551	)		1,814			(2,137	)
Income before income taxes		8,492			15,469			13,211			26,996
Provision for income taxes		2,428			2,431			4,437			4,356
Net income	$	6,064		$	13,038		$	8,774		$	22,640
Net income per share:
Basic	$	0.13		$	0.27		$	0.18		$	0.47
Diluted	$	0.12		$	0.26		$	0.18		$	0.46
Weighted average shares outstanding:
Basic		48,418			47,889			48,333			47,822
Diluted		49,516			49,223			49,524			49,264

See accompanying notes to the condensed consolidated financial statements.

2

STAAR SURGICAL COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

(Unaudited)

	Three Months Ended						Six Months Ended
	June 30, 2023			July 1, 2022			June 30, 2023			July 1, 2022
Net income	$	6,064		$	13,038		$	8,774		$	22,640
Other comprehensive income (loss):
Defined benefit plans:
Net change in plan assets		(547	)		2,593			(1,724	)		6,661
Reclassification into other income (expense), net		(51	)		33			(103	)		85
Investments available for sale:
Change in unrealized gain (loss)		(142	)		—			(26	)		—
Reclassification into other income (expense), net		—			—			(2	)		—
Foreign currency translation gain (loss)		(1,342	)		(1,502	)		(1,471	)		(2,516	)
Tax effect		498			188			649			67
Other comprehensive income (loss), net of tax		(1,584	)		1,312			(2,677	)		4,297
Comprehensive income	$	4,480		$	14,350		$	6,097		$	26,937

See accompanying notes to the condensed consolidated financial statements.

3

STAAR SURGICAL COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In thousands)

(Unaudited)

	Three Months Ended
	Common Stock Shares			Common Stock Par Value		Additional Paid-In Capital			Accumulated Other Compre- hensive Income (Loss)			Accumulated Deficit			Total
Balance, at March 31, 2023		48,331		$	483	$	409,303		$	(937	)	$	(69,925	)	$	338,924
Net income		—			—		—			—			6,064			6,064
Other comprehensive loss		—			—		—			(1,584	)		—			(1,584	)
Common stock issued upon exercise of options		155			2		1,475			—			—			1,477
Stock-based compensation		—			—		8,951			—			—			8,951
Repurchase of employee common stock for taxes withheld		(3	)		—		(135	)		—			—			(135	)
Unvested restricted stock		10			—		—			—			—			—
Vested restricted and performance stock		6			—		—			—			—			—
Balance, at June 30, 2023		48,499		$	485	$	419,594		$	(2,521	)	$	(63,861	)	$	353,697
Balance, at April 1, 2022		47,810		$	478	$	378,690		$	(1,063	)	$	(101,788	)	$	276,317
Net income		—			—		—			—			13,038			13,038
Other comprehensive income		—			—		—			1,312			—			1,312
Common stock issued upon exercise of options		202			2		2,232			—			—			2,234
Stock-based compensation		—			—		6,406			—			—			6,406
Unvested restricted stock		7			—		—			—			—			—
Vested restricted and performance stock		5			—		—			—			—			—
Balance, at July 1, 2022		48,024		$	480	$	387,328		$	249		$	(88,750	)	$	299,307

See accompanying notes to the condensed consolidated financial statements.

4

STAAR SURGICAL COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In thousands)

(Unaudited)

	Six Months Ended
	Common Stock Shares			Common Stock Par Value		Additional Paid-In Capital			Accumulated Other Compre- hensive Income (Loss)			Accumulated Deficit			Total
Balance, at December 30, 2022		48,212		$	482	$	404,189		$	156		$	(72,635	)	$	332,192
Net income		—			—		—			—			8,774			8,774
Other comprehensive loss		—			—		—			(2,677	)		—			(2,677	)
Common stock issued upon exercise of options		195			2		2,004			—			—			2,006
Stock-based compensation		—			—		15,385			—			—			15,385
Repurchase of employee common stock for taxes withheld		(34	)		—		(1,984	)		—			—			(1,984	)
Unvested restricted stock		10			—		—			—			—			—
Vested restricted and performance stock		116			1		—			—			—			1
Balance, at June 30, 2023		48,499		$	485	$	419,594		$	(2,521	)	$	(63,861	)	$	353,697
Balance, at December 31, 2021		47,716		$	477	$	373,519		$	(4,048	)	$	(111,390	)	$	258,558
Net income		—			—		—			—			22,640			22,640
Other comprehensive income		—			—		—			4,297			—			4,297
Common stock issued upon exercise of options		251			3		3,143			—			—			3,146
Stock-based compensation		—			—		10,666			—			—			10,666
Unvested restricted stock		7			—		—			—			—			—
Vested restricted and performance stock		50			—		—			—			—			—
Balance, at July 1, 2022		48,024		$	480	$	387,328		$	249		$	(88,750	)	$	299,307

See accompanying notes to the condensed consolidated financial statements.

5

STAAR SURGICAL COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

	Six Months Ended
	June 30, 2023			July 1, 2022
Cash flows from operating activities:
Net income	$	8,774		$	22,640
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation of property, plant, and equipment		2,398			2,024
Amortization of intangibles		171			15
Accretion/Amortization of investments available for sale		(1,824	)		—
Deferred income taxes		75			—
Change in net pension liability		(627	)		52
Loss on disposal of property and equipment		24			—
Stock-based compensation expense		14,488			9,648
Change in asset retirement obligation		(107	)		—
Provision for sales returns and bad debts		1,004			800
Inventory provision		3,630			1,428
Changes in working capital:
Accounts receivable		(32,344	)		(20,137	)
Inventories		(4,382	)		(1,825	)
Prepayments, deposits, and other current assets		(2,665	)		(2,260	)
Accounts payable		(1,447	)		3,243
Other current liabilities		1,432			(6,992	)
Net cash provided by (used in) operating activities		(11,400	)		8,636
Cash flows from investing activities:
Acquisition of property and equipment		(5,915	)		(7,810	)
Purchase of investments available for sale		(42,602	)		—
Proceeds from sale or maturity of investments available for sale		68,622			—
Net cash provided by (used in) investing activities		20,105			(7,810	)
Cash flows from financing activities:
Repayment of finance lease obligations		(82	)		(45	)
Repurchase of employee common stock for taxes withheld		(1,984	)		—
Proceeds from the exercise of stock options		2,006			3,146
Proceeds from vested restricted stock		1			—
Net cash provided by (used in) financing activities		(59	)		3,101
Effect of exchange rate changes on cash and cash equivalents		(431	)		(1,143	)
Increase in cash and cash equivalents		8,215			2,784
Cash and cash equivalents, at beginning of the period		86,480			199,706
Cash and cash equivalents, at end of the period	$	94,695		$	202,490

See accompanying notes to the condensed consolidated financial statements.

6

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

Note 1 — Basis of Presentation and Significant Accounting Policies

The Condensed Consolidated Financial Statements of the Company present the financial position, results of operations, and cash flows of STAAR Surgical Company and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X of the Securities Exchange Commission. In accordance with those rules and regulations certain information and footnote disclosures normally included in the Comprehensive Financial Statements have been condensed or omitted pursuant to such rules and regulations. The Consolidated Balance Sheet as of December 30, 2022 was derived from the audited financial statements at that date, but does not include all the information and footnotes required by GAAP. These financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 30, 2022.

The Condensed Consolidated Financial Statements for the three and six months ended June 30, 2023 and July 1, 2022, in the opinion of management, include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the Company’s financial condition and results of operations. The results of operations for the three and six months ended June 30, 2023 and July 1, 2022, are not necessarily indicative of the results to be expected for any other interim period or for the entire year.

Each of the Company’s fiscal reporting periods ends on the Friday nearest to the quarter ending date and generally consists of 13 weeks. Unless the context indicates otherwise “we,” “us,” the “Company,” and “STAAR” refer to STAAR Surgical Company and its consolidated subsidiaries.

Vendor Concentration

There was one vendor that accounted for over 10% of the Company’s consolidated accounts payable as of June 30, 2023. There were no vendors that accounted for over 10% of the Company’s consolidated accounts payable as of December 30, 2022.

Note 2 — Investments Available for Sale

During the second half of 2022, the Company started to invest its cash in slightly higher yielding securities. Investments available for sale (“AFS”) and the related fair value measurement consisted of the following (dollars in thousands):

	June 30, 2023
										Fair Value Measurements
	Amortized Cost		Unrealized Gains		Unrealized Losses			Estimated Fair Value		Level 1		Level 2
Commercial paper	$	28,519	$	—	$	(19	)	$	28,500	$	—	$	28,500
Certificates of deposit		10,774		1		(13	)		10,762		—		10,762
U.S. Treasury securities		30,318		—		(203	)		30,115		30,115		—
U.S. agency securities		11,034		—		(32	)		11,002		—		11,002
Corporate debt securities		34,625		3		(170	)		34,458		—		34,458
Total investments AFS	$	115,270	$	4	$	(437	)	$	114,837	$	30,115	$	84,722
	December 30, 2022
										Fair Value Measurements
	Amortized Cost		Unrealized Gains		Unrealized Losses			Estimated Fair Value		Level 1		Level 2
Commercial paper	$	44,054	$	11	$	(62	)	$	44,003	$	—	$	44,003
Certificates of deposit		17,355		4		(75	)		17,284		—		17,284
U.S. Treasury securities		21,847		3		(15	)		21,835		21,835		—
U.S. agency securities		10,688		16		(3	)		10,701		—		10,701
Corporate debt securities		45,522		4		(288	)		45,238		—		45,238
Total investments AFS	$	139,466	$	38	$	(443	)	$	139,061	$	21,835	$	117,226

7

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

Note 2 — Investments Available for Sale (Continued)

The Company obtains the fair value from third-party pricing services. The pricing services utilize industry standard valuation models, including both income and market-based approaches and observable market inputs to determine value. These observable market inputs include reportable trades, benchmark yields, credit spreads, broker/dealer quotes, bids, offers and other industry and economic events.

The Company assessed each debt security with gross unrealized losses for impairment. As part of that assessment, the Company concluded that it does not intend to sell and it is more-likely-than-not that the Company will not be required to sell, prior to the recovery of the amortized cost basis. The Company did not recognize impairment for the three and six months ended June 30, 2023.

The following table shows the fair value of investments AFS by contractual maturity (dollars in thousands):

	As of June 30, 2023
	Within one year		After one year through five years		Total
Commercial paper	$	28,500	$	—	$	28,500
Certificates of deposit		10,762		—		10,762
U.S. Treasury securities		16,613		13,502		30,115
U.S. agency securities		10,030		972		11,002
Corporate debt securities		31,407		3,051		34,458
Total investments AFS	$	97,312	$	17,525	$	114,837

During the six months ended June 30, 2023, the Company sold $600,000 in securities during the first quarter of 2023 due to a downgraded credit rating. The Company recognized a realized gain upon sale of $2,000 during the six months ended June 30, 2023.

Note 3 — Inventories

Inventories, net are stated at the lower of cost and net realizable value, determined on a first-in, first-out basis and consisted of the following (in thousands):

	June 30, 2023			December 30, 2022
Raw materials and purchased parts	$	7,341		$	6,703
Work in process		5,865			5,499
Finished goods		16,502			13,633
Total inventories, gross		29,708			25,835
Less inventory reserves		(4,226	)		(1,674	)
Total inventories, net	$	25,482		$	24,161

Note 4 — Prepayments, Deposits, and Other Current Assets

Prepayments, deposits, and other current assets consisted of the following (in thousands):

	June 30, 2023		December 30, 2022
Prepayments and deposits	$	4,968	$	3,986
Prepaid insurance		1,190		2,620
Prepaid marketing costs		3,353		2,534
Consumption tax receivable		802		864
Value added tax (VAT) receivable		3,880		2,661
BVG (Swiss Pension) prepayment		1,211		111
Other(1)		668		700
Total prepayments, deposits and other current assets	$	16,072	$	13,476

(1)No individual category in “other current assets” exceeds 5% of the total prepayments, deposits and other current assets.

8

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

Note 5 — Property, Plant and Equipment

Property, plant and equipment, net consisted of the following (in thousands):

	June 30, 2023			December 30, 2022
Machinery and equipment	$	29,836		$	28,026
Computer equipment and software		9,591			9,266
Furniture and fixtures		4,491			4,276
Leasehold improvements		16,840			14,965
Construction in process		35,109			32,269
Total property, plant and equipment, gross		95,867			88,802
Less accumulated depreciation		(39,943	)		(37,881	)
Total property, plant and equipment, net	$	55,924		$	50,921

Note 6 – Intangible Assets

Intangible assets, net consisted of the following (in thousands):

	June 30, 2023							December 30, 2022
Long-lived amortized intangible assets	Gross Carrying Amount		Accumulated Amortization			Net		Gross Carrying Amount		Accumulated Amortization			Net
Patents and licenses	$	9,195	$	(9,195	)	$	—	$	9,240	$	(9,067	)	$	173

During the three and six months ended June 30, 2023, the Company recognized full impairment of $154,000 for its Japan patents and licenses related to cataract IOLs.

Note 7 – Other Current Liabilities

Other current liabilities consisted of the following (in thousands):

	June 30, 2023		December 30, 2022
Accrued salaries and wages	$	11,511	$	10,862
Accrued bonuses		1,707		6,925
Income taxes payable		7,202		3,845
Marketing obligations		1,354		1,374
Other(1)		10,151		7,735
Total other current liabilities	$	31,925	$	30,741

(1)No individual category in “Other” exceeds 5% of the other current liabilities.

Note 8 – Leases

Finance Leases

The Company entered into finance leases primarily related to purchases of equipment used for manufacturing, computer-related equipment or furniture and fixtures. These finance leases are two to five years in length and have fixed payment amounts for the term of the contract and have options to purchase the assets at the end of the lease term. Supplemental balance sheet information related to finance leases consisted of the following (dollars in thousands):

9

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

Note 8 – Leases (Continued)

Finance Leases (Continued)

	June 30, 2023			December 30, 2022
Machinery and equipment	$	—		$	30
Computer equipment and software		6			18
Furniture and fixtures		475			475
Finance lease right-of-use assets, gross		481			523
Less accumulated depreciation		(224	)		(181	)
Finance lease right-of-use assets, net	$	257		$	342
Current finance lease obligations	$	162		$	169
Long-term finance lease obligations		125			210
Total finance lease liability	$	287		$	379
Weighted-average remaining lease term (in years)		1.8			2.2
Weighted-average discount rate		4.23	%		4.10	%

Supplemental cash flow information related to finance leases consisted of the following (dollars in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Amortization of finance lease right-of-use asset	$	38	$	39	$	77	$	82
Interest on finance lease liabilities		3		5		7		8
Cash paid for amounts included in the measurement of finance lease liabilities:
Operating cash flows		3		5		7		8
Financing cash flows		40		27		82		45

Operating Leases

The Company entered into operating leases primarily related to real property (office, manufacturing and warehouse facilities), automobiles and copiers. These operating leases are two to ten years in length with options to extend. The Company does not include any lease extensions in the initial valuation unless the Company was reasonably certain to extend the lease. Depending on the lease, there are those with fixed payment amounts for the entire length of the contract or payments which increase periodically as noted in the contract or increased at an inflation rate indicator. For operating leases that increase using an inflation rate indicator, the Company used the inflation rate at the time the lease was entered into for the length of the lease term. Supplemental balance sheet information related to operating leases consisted of the following (dollars in thousands):

	June 30, 2023			December 30, 2022
Machinery and equipment	$	752		$	789
Computer equipment and software		446			446
Real property		36,756			34,465
Operating lease right-of-use assets, gross		37,954			35,700
Less accumulated depreciation		(6,424	)		(5,430	)
Operating lease right-of-use assets, net	$	31,530		$	30,270
Current operating lease obligations	$	4,013		$	3,524
Long-term operating lease obligations		28,189			27,136
Total operating lease liability	$	32,202		$	30,660
Weighted-average remaining lease term (in years)		7.2			7.5
Weighted-average discount rate		4.44	%		3.87	%

10

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

Note 8 – Leases (Continued)

Operating Leases (Continued)

Supplemental cash flow information related to operating leases was as follows (dollars in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Operating lease cost	$	1,357	$	1,166	$	2,464	$	2,304
Cash paid for amounts included in the measurement of operating lease liabilities:
Operating cash flows		1,152		1,034		2,325		1,966
Right-of-use assets obtained in exchange for new operating lease liabilities		1,511		2,081		3,420		2,756

Future Maturities of Lease Liabilities

Estimated future maturities of lease liabilities under operating and finance leases having initial or remaining non-cancelable lease terms more than one year as of June 30, 2023 is as follows (in thousands):

.

As of June 30, 2023 12 Months Ended	Operating Leases			Finance Leases
June 2024	$	5,990		$	171
June 2025		5,834			127
June 2026		4,463			—
June 2027		4,432			—
June 2028		4,476			—
Thereafter		13,433			—
Total future minimum lease payments	$	38,628		$	298
Less amounts representing interest		(6,426	)		(11	)
Total lease liability	$	32,202		$	287

Note 9 — Income Taxes

The Company recorded an income tax provision as follows (in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Provision for income taxes	$	2,428	$	2,431	$	4,437	$	4,356

The effective tax rates for the three months ended June 30, 2023 and July 1, 2022 were 28.6% and 15.7%, respectively, and were 33.6% and 16.1% for the six months ended June 30, 2023 and July 1, 2022, respectively. The Company’s effective tax rates differ from the U.S. federal statutory rate of 21% for the three and six months ended June 30, 2023 and July 1, 2022, respectively, primarily due to the income tax expense generated in foreign jurisdictions.

11

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

Note 10 – Defined Benefit Pension Plans

The Company has defined benefit plans covering employees of its Switzerland and Japan operations. The following table summarizes the components of net periodic pension cost recorded for the Company’s defined benefit pension plans (in thousands):

	Three Months Ended						Six Months Ended
	June 30, 2023			July 1, 2022			June 30, 2023			July 1, 2022
Service cost(1)	$	254		$	309		$	503		$	635
Interest cost(2)		90			21			177			41
Expected return on plan assets(2)		(91	)		(123	)		(178	)		(241	)
Prior service credit(2),(3)		(45	)		(46	)		(90	)		(91	)
Actuarial loss recognized in current period(2),(3)		(6	)		79			(13	)		176
Net periodic pension cost	$	202		$	240		$	399		$	520

(1)Recognized in selling general and administrative expenses on the Condensed Consolidated Statements of Income.

(2)Recognized in other expense, net on the Condensed Consolidated Statements of Income.

(3)Amounts reclassified from accumulated other comprehensive income (loss).

The Company currently is not required to and does not make contributions to its Japan pension plan. The Company’s contributions to its Swiss pension plan are as follows (in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Employer contribution	$	245	$	220	$	462	$	436

Note 11 — Stockholders’ Equity

Stock-Based Compensation

The cost that has been charged against income for stock-based compensation is set forth below (in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Employee stock options	$	3,479	$	2,457	$	6,456	$	4,784
Restricted stock		79		442		146		551
Restricted stock units		2,148		1,231		3,749		1,993
Performance stock units		2,403		1,310		3,509		1,692
Nonemployee stock options		314		314		628		628
Total stock-based compensation expense	$	8,423	$	5,754	$	14,488	$	9,648

The Company recorded stock-based compensation costs in the following categories (in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Cost of sales	$	223	$	106	$	372	$	176
General and administrative		3,695		2,806		7,058		4,587
Selling and marketing		2,492		1,324		3,349		2,213
Research and development		2,013		1,518		3,709		2,672
Total stock-based compensation expense, net		8,423		5,754		14,488		9,648
Amounts capitalized as part of inventory		528		652		897		1,018
Total stock-based compensation expense, gross	$	8,951	$	6,406	$	15,385	$	10,666

12

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

Note 11 — Stockholders’ Equity (Continued)

Incentive Plan

The Amended and Restated Omnibus Equity Incentive Plan (“the Plan”) provides for various forms of stock-based incentives. To date, of the available forms of awards under the Plan, the Company has granted only stock options, restricted stock, unrestricted share grants, restricted stock units (“RSUs”) and performance stock units (“PSUs”). Options under the Plan are granted at fair market value on the date of grant, become exercisable generally over a three-year period, or as determined by the Board of Directors, and expire over periods not exceeding 10 years from the date of grant. Certain option and share awards provide for accelerated vesting if there is a change in control and pre-established financial metrics are met (as defined in the Plan). Grants of restricted stock outstanding under the Plan generally vest over periods of one to three years. Grants of RSUs and PSUs outstanding under the Plan generally vest based on service, performance, or a combination of both. On June 15, 2023, stockholders approved a proposal to increase the number of shares under the plan by 2,170,000 shares, for a total of 20,205,000 shares. As of June 30, 2023, there were 2,844,500 shares available for grant under the Plan.

Assumptions

The fair value of each option award is estimated on the date of grant using a Black-Scholes option valuation model applying the weighted-average assumptions noted in the following table. Expected volatilities are based on historical volatility of the Company’s stock. The expected term of options granted is derived from the historical exercises and post-vesting cancellations and represents the period of time that options granted are expected to be outstanding. The Company has calculated a 7% estimated forfeiture rate based on historical forfeiture experience. The risk-free rate is based on the U.S. Treasury yield curve corresponding to the expected term at the time of the grant.

	Three Months Ended						Six Months Ended
	June 30, 2023			July 1, 2022			June 30, 2023			July 1, 2022
Expected dividend yield		0	%		0	%		0	%		0	%
Expected volatility		58	%		54	%		59	%		54	%
Risk-free interest rate		3.41	%		3.27	%		3.87	%		1.83	%
Expected term (in years)		4.87			5.10			5.02			5.10

Stock Options

A summary of stock option activity under the Plan for six months ended June 30, 2023 is presented below:

	Stock Options (in 000’s)			Minimum Exercise Price		Maximum Exercise Price
Outstanding at December 30, 2022		2,469
Granted		584
Exercised		(195	)
Forfeited or expired		(31	)
Outstanding at June 30, 2023		2,827		$	5.54	$	154.96
Exercisable at June 30, 2023		1,903

Restricted Stock, Restricted Stock Units and Performance Stock Units

A summary of restricted stock, RSUs and PSUs activity under the Plan for the six months ended June 30, 2023 is presented below (shares in thousands):

	Restricted Stock			RSUs			PSUs
Unvested at December 30, 2022		4			192			118
Granted		10			259			178
Vested		(4	)		(80	)		(36	)
Forfeited or expired		—			(6	)		(11	)
Unvested at June 30, 2023		10			365			249

13

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

Note 12 - Commitments and Contingencies

Severance Payable

As of June 30, 2023 and December 30, 2022 there was severance payable of $508,000 and $410,000, respectively. recognized in other current liabilities on the Consolidated Balance Sheets, which included approximately $341,000 and $300,000, respectively, in one-time employee benefits to be paid to certain employees in STAAR Japan who work primarily in IOL sales. During the three and six months ended June 30, 2023, the Company recognized $159,000 and $1,351,000, respectively, related to this. The Company is expected to incur through the end of 2023, one-time employee benefits of approximately $1,440,000 related to this. These one-time employee benefits are recognized in general and administrative expense on the Consolidated Statements of Income.

Litigation and Claims

From time to time, the Company is involved in various legal proceedings and other matters arising in the normal course of business. These legal proceedings and other matters may relate to, among other things, contractual rights and obligations, employment matters, or claims of product liability. STAAR maintains insurance coverage for various matters, including product liability and certain securities claims. While the Company does not believe that any of the claims known is likely to have a material adverse effect on the Company’s financial condition or results of operations, new claims or unexpected results of existing claims could lead to significant financial harm.

Employment Agreements

The Company’s Chief Executive Officer entered into an employment agreement with the Company, effective January 1, 2023. He and certain officers have as provisions of their agreements certain rights, including continuance of cash compensation and benefits, upon a “change in control,” which may include an acquisition of substantially all its assets, or termination “without cause or for good reason” as defined in the employment agreements.

Note 13 — Basic and Diluted Net Income Per Share

The following table sets forth the computation of basic and diluted net income per share (in thousands except per share amounts):

	Three Months Ended						Six Months Ended
	June 30, 2023			July 1, 2022			June 30, 2023			July 1, 2022
Numerator:
Net income	$	6,064		$	13,038		$	8,774		$	22,640
Denominator:
Weighted average common shares:
Common shares outstanding		48,428			47,893			48,343			47,826
Less: Unvested restricted stock		(10	)		(4	)		(10	)		(4	)
Denominator for basic calculation		48,418			47,889			48,333			47,822
Weighted average effects of potentially diluted common stock:
Stock options		986			1,299			1,050			1,386
Unvested restricted stock		3			3			3			2
RSUs		46			24			77			45
PSUs		63			8			61			9
Denominator for diluted calculation		49,516			49,223			49,524			49,264
Net income per share:
Basic	$	0.13		$	0.27		$	0.18		$	0.47
Diluted	$	0.12		$	0.26		$	0.18		$	0.46

The following table sets forth (in thousands) the weighted average number of options to purchase shares of common stock, restricted stock, RSUs and PSUs with either exercise prices or unrecognized compensation cost per share greater than the average market price per share of the Company’s common stock, which were not included in the calculation of diluted per share amounts because the effects would be anti-dilutive.

14

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

Note 13 — Basic and Diluted Net Income Per Share (Continued)

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Stock options		1,874		1,153		1,625		862
Restricted stock, RSUs and PSUs		127		267		24		122
Total		2,001		1,420		1,649		984

Note 14 — Disaggregation of Sales, Geographic Sales and Product Sales

In the following tables, sales are disaggregated by category, sales by geographic market and sales by product data. The following breaks down sales into the following categories (in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Non-consignment sales	$	88,068	$	76,444	$	155,231	$	134,013
Consignment sales		4,238		4,657		10,603		10,288
Total net sales		92,306		81,101	$	165,834	$	144,301

The Company markets and sells its products in over 75 countries and conducts its manufacturing in the United States. Other than China and Japan, the Company does not conduct business in any country in which its sales exceed 10% of worldwide consolidated net sales. Sales are attributed to countries based on location of customers. The composition of the Company’s net sales to unaffiliated customers was as follows (in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Domestic	$	4,346	$	3,872	$	8,897	$	6,502
Foreign:
China		61,339		46,150		96,429		74,389
Japan		8,415		10,302		19,351		21,935
Other(1)		18,206		20,777		41,157		41,475
Total foreign sales		87,960		77,229		156,937		137,799
Total net sales	$	92,306	$	81,101	$	165,834	$	144,301

(1)No other location individually exceeds 10% of the total sales.

100% of the Company’s sales are generated from the ophthalmic surgical product segment and the chief operating decision maker makes operating decisions and allocates resources based upon the consolidated operating results, and therefore the Company operates as one operating segment for financial reporting purposes. The Company’s principal products are implantable Collamer lenses (“ICLs”) used in refractive surgery and intraocular lenses (“IOLs”) used in cataract surgery. The composition of the Company’s net sales by product line was as follows (in thousands):

	Three Months Ended					Six Months Ended
	June 30, 2023			July 1, 2022		June 30, 2023		July 1, 2022
ICLs	$	93,112		$	77,922	$	163,737	$	136,597
Other product sales:
Cataract IOLs		40			2,547		1,516		5,449
Other surgical products(1)		(846	)		632		581		2,255
Total other product sales		(806	)		3,179		2,097		7,704
Total net sales	$	92,306		$	81,101	$	165,834	$	144,301

(1) Other surgical products include delivery systems and normal recurring sales adjustments such as sales return allowances.

15

STAAR SURGICAL COMPANY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

Note 14 — Disaggregation of Sales, Geographic Sales and Product Sales (Continued)

One customer, the Company’s distributor in China, accounted for 66% and 57% of net sales for the three months ended June 30, 2023 and July 1, 2022, respectively, and the same customer accounted for 58% and 52% for the six months ended June 30, 2023 and July 1, 2022, respectively. As of June 30, 2023 and December 30, 2022, respectively, one customer, the Company’s distributor in China, accounted for 74% and 59% of consolidated trade receivables.

Note 15 — COVID-19 Developments

In December 2019, COVID-19 surfaced and in March 2020, the World Health Organization declared a pandemic related to the rapid spread of COVID-19 around the world. The impact of the COVID-19 outbreak on the businesses and the economy in the U.S. and the rest of the world is, and is expected to continue to be, uncertain and may continue to be significant as COVID-19 variant strains emerge. The Company’s revenues have been adversely impacted, and the Company experienced a substantial slowdown in sales beginning March 20, 2020 in global geographies characterized as “hot spots” for the COVID-19 virus, including parts of Europe, North America, Asia, the Middle East and India. In certain of these markets, sales have paused as elective surgeries are discouraged to support COVID-19 related needs. While COVID-19 restrictions have since eased globally during 2022, a resurgence of the COVID-19 pandemic in global geographies, depending upon its duration and severity, could material adversely impact the global economy and the Company's industry, operations and financial condition and performance. The Company continues to monitor the commercial and operational impact of new variants of COVID-19 in its markets.

16

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The matters addressed in this Item 2 that are not historical information constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Readers can recognize forward-looking statements by the use of words like “anticipate,” “estimate,” “expect,” “intend,” “plan,” “believe,” “will,” “should,” “forecast” and similar expressions in connection with any discussion of future operating or financial performance. In particular, these include statements about any of the following: any projections of or guidance as to earnings, revenue, sales, profit margins, expense rate, cash, effective tax rate, product mix, capital expense or any other financial items; the expected impact of the COVID-19 pandemic and related public health measures (including but not limited to their impact on sales, operations or clinical trials globally), the plans, strategies, and objectives of management for future operations or prospects for achieving such plans; statements regarding new, existing, or improved products, including but not limited to, expectations for success of new, existing, and improved products in the U.S. or international markets or government approval of a new or improved products; commercialization of new or improved products; future economic conditions or size of market opportunities; expected costs of operations; statements of belief, including as to achieving 2023 business plans; expected regulatory activities and approvals, product launches, and any statements of assumptions underlying any of the foregoing.

Although we believe that the expectations reflected in these forward-looking statements are reasonable, such statements are inherently subject to risks and we can give no assurance that our expectations will prove to be correct. Actual results could differ from those described in this report because of numerous factors, many of which are beyond our control. These factors include, without limitation, those described in our Annual Report on Form 10-K in “Item 1A. Risk Factors” filed on February 23, 2023. We undertake no obligation to update these forward-looking statements after the date of this report to reflect future events or circumstances or to reflect actual outcomes.

The following discussion should be read in conjunction with the audited consolidated financial statements of STAAR, including the related notes, provided in this report.

We intend to use our website as a means of disclosing material non-public information and for complying with our disclosure obligations under Regulation FD. Such disclosures will be included on our website in the ‘Investor Relations’ sections. Accordingly, investors should monitor such portions of our website, in addition to following our press releases, SEC filings and public conference calls and webcasts.

Overview

STAAR Surgical Company designs, develops, manufactures, and sells implantable lenses for the eye and companion delivery systems used to deliver the lenses into the eye. We are the world’s leading manufacturer of intraocular lenses for patients seeking refractive vision correction, and we also make lenses for use in surgery to treat cataracts. All the lenses we make are foldable, which allows the surgeon to insert them into the eye through a small incision during minimally invasive surgery. Refractive surgery is performed to treat the type of visual disorders that have traditionally been corrected using eyeglasses or contact lenses. We refer to our lenses used in refractive surgery as “implantable Collamer® lenses” or “ICLs.” The field of refractive surgery includes both lens-based procedures, using products like our ICL family of products, and laser-based procedures like LASIK. Successful refractive surgery can correct common vision disorders such as myopia, hyperopia, and astigmatism. Cataract surgery is a common outpatient procedure where the eye’s natural lens that has become cloudy with age is removed and replaced with an artificial lens called an intraocular lens (“IOL”) to restore the patient’s vision. STAAR employs a commercialization strategy that strives for sustainable profitable growth. Our goal is to position our refractive lenses throughout the world as primary and premium solutions for patients seeking visual freedom from wearing eyeglasses or contact lenses while achieving excellent visual acuity through refractive vision correction. We position our cataract IOL lenses used in surgery that treats cataracts based on quality and value.

Recent Developments

STAAR achieved 19% growth in ICL sales in the second quarter, compared to the second quarter of 2022, with sales growth in the Asia Pacific markets up 26%, EMEA markets down 9%, and the U.S. up 10%. In China, ICL sales were up 33% compared to the second quarter of 2022. Sales in our EMEA markets were impacted by the on-going macroeconomic and geopolitical environment, as well as an inability to ship ICLs into one non-European country as a result of a country-specific product labeling change. We have taken a number of steps and implemented initiatives that we expect will accelerate EVO adoption in the U.S. as we exit 2023 and beyond. Also, we have adjusted the timing of certain marketing investments as we remain committed to prudent spending and return on our investments. Given increased conservatism related to the global

17

environment, and slower than expected growth in the U.S, we updated our fiscal 2023 ICL sales outlook to a range of approximately $320 million to $325 million.

As part of our previously disclosed decision to wind down (i.e., no longer manufacture and reduce support) our Other Products business (i.e., our low margin cataract IOLs and related delivery systems), we decided to take additional sales return and inventory reserves for our remaining Other Products business. This included a $0.7 million sales return reserve for expected returns of our acrylic IOLs; $1.2 million inventory reserve for acrylic IOLs; and $1.6 million inventory reserve for silicone IOLs. As previously disclosed, in March 2023 we issued a Field Safety Notice to affected customers in parts of Europe and Japan to stop using our acrylic cataract IOLs. This was done as a precautionary measure in response to a Field Safety Notice issued by another company regarding a similarly manufactured product. To date, testing of our acrylic cataract IOL and injector system has been inconclusive and has not identified a root cause that would result in a safety issue. Nevertheless, in an abundance of caution, STAAR Japan has asked clinics to no longer use the acrylic IOL system and return them for a credit.

Critical Accounting Estimates

This Management’s Discussion and Analysis of Financial Condition and Results of Income discusses and analyzes data in our unaudited Condensed Consolidated Financial Statements provided in this report, which we have prepared in accordance with U.S. generally accepted accounting principles. Preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosure of contingent assets and liabilities. Management bases its estimates on historical experience and on various other assumptions that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Senior management has discussed the development, selection and disclosure of these estimates with the Audit Committee of our Board of Directors. Actual conditions may differ from our assumptions and actual results may differ from our estimates.

Management believes that there have been no significant changes during the six months ended June 30, 2023 to the items that we disclosed as our critical accounting estimates in Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended December 30, 2022.

Results of Operations

The following table shows the percentage of our total sales represented by certain items reflected in our Condensed Consolidated Statements of Income for the periods indicated.

	Percentage of Net Sales for Three Months						Percentage of Net Sales for Six Months
	June 30, 2023			July 1, 2022			June 30, 2023			July 1, 2022
Net sales		100.0	%		100.0	%		100.0	%		100.0	%
Cost of sales		23.4	%		21.2	%		22.6	%		21.6	%
Gross profit		76.6	%		78.8	%		77.4	%		78.4	%
General and administrative		19.6	%		17.2	%		21.8	%		18.0	%
Selling and marketing		35.0	%		29.9	%		35.4	%		28.8	%
Research and development		12.7	%		10.7	%		13.3	%		11.4	%
Total selling, general and administrative		67.3	%		57.8	%		70.5	%		58.2	%
Operating income		9.3	%		21.0	%		6.9	%		20.2	%
Total other income (expense), net		(0.1	)%		(1.9	)%		1.1	%		(1.5	)%
Income before income taxes		9.2	%		19.1	%		8.0	%		18.7	%
Provision for income taxes		2.6	%		3.0	%		2.7	%		3.0	%
Net income		6.6	%		16.1	%		5.3	%		15.7	%

18

Net Sales

The following table presents our net sales, by product (dollars in thousands):

	Three Months Ended					Percentage Change			Six Months Ended				Percentage Change
	June 30, 2023			July 1, 2022		2023 vs. 2022			June 30, 2023		July 1, 2022		2023 vs. 2022
ICLs	$	93,112		$	77,922		19.5	%	$	163,737	$	136,597		19.9	%
Other product sales:
Cataract IOLs		40			2,547		(98.4	)%		1,516		5,449		(72.2	)%
Other surgical products		(846	)		632		—	*		581		2,255		(74.2	)%
Total other product sales		(806	)		3,179		—	*		2,097		7,704		(72.8	)%
Net sales	$	92,306		$	81,101		13.8	%	$	165,834	$	144,301		14.9	%

* Denotes change is greater than +100%.

Net sales for the three months ended June 30, 2023 increased 14% from the same period of 2022. The increase in net sales was primarily due to increased ICL sales of $15.2 million, slightly offset by decreased other product sales of $4.0 million. Changes in foreign currency unfavorably impacted net sales by $0.4 million.

Net sales for the six months ended June 30, 2023 increased 15% from the same period of 2022. The increase in net sales was primarily due to increased ICL sales of $27.1 million, slightly offset by decreased other product sales of $5.6 million. Changes in foreign currency unfavorably impacted net sales by $2.4 million.

Total ICL sales for the three months ended June 30, 2023 increased 19% from the same period of 2022, with unit increase of 21%. The APAC region sales increased by 26%, with unit growth up 29%, due to sales growth in China up 33%, India up 14% and Japan up 13%, partially offset by sales decreases in Korea down 15%. The Europe, Middle East, Africa and Latin America region sales decreased 9% with unit decrease of 23%, due to sales decreases in our distributor markets down 14% and direct markets down 4%. The North America region sales increased 10%, with unit growth up 10%, primarily due to sales growth in the U.S. up 10%. Changes in foreign currency unfavorably impacted ICL sales by $0.4 million for the three months ended June 30, 2023, which impacted our Japan and Europe, Middle East and Africa markets. ICL sales represented 100.9% and 96.1% of our total sales for the three months ended June 30, 2023 and July 1, 2022, respectively.

Total ICL sales for the six months ended June 30, 2023 increased 20% from the same period of 2022, with unit increase of 21%. The APAC region sales increased by 23%, with unit growth up 25%, due to sales growth in China up 30%, other APAC regions up 13%, India up 11%, Japan up 9% and Korea up 5%. The Europe, Middle East, Africa and Latin America region sales were flat with unit decrease of 7%, due to sales decreases in our distributor markets down 1%, offset by growth in in our direct markets up 1%. The North America region sales increased 29%, with unit growth up 30%, primarily due to sales growth in the U.S. up 34%. In late March 2022, the U.S. started to sell EVO ICLs. Changes in foreign currency unfavorably impacted ICL sales by $2.1 million for the six months ended June 30, 2023, which impacted our Japan and Europe, Middle East and Africa markets. ICL sales represented 98.7% and 94.7% of our total sales for the six months ended June 30, 2023 and July 1, 2022, respectively.

Other product sales, includes cataract IOLs, delivery systems and normal recurring sales adjustments such as sales return allowances. As a result of third-party materials and supply chain challenges that affect our cataract IOLs and associated delivery devices, we will no longer manufacture cataract IOLs, though we will continue to support these products through the end of 2023, as supplies permit. We do not expect this decision to have a significant impact to revenue growth in future years. Other product sales for the three and six months ended June 30, 2023, decreased 125% and 73%, respectively, from the same period of 2022, due to primarily to a reduction in cataract IOL sales, decreased sales of cataract IOL injector parts and sales return reserves related to cataract IOLs. Changes in foreign currency unfavorably impacted other product sales by $0.3 million for the six months ended June 30, 2023. Other product sales represented (0.9%) and 3.9% of our total sales for the three months ended June 30, 2023 and July 1, 2022, respectively, and represented 1.3% and 5.3% of our total sales for the six months ended June 30, 2023 and July 1, 2022, respectively.

19

Gross Profit

The following table presents our gross profit and gross profit margin (dollars in thousands):

	Three Months Ended						Percentage Change			Six Months Ended						Percentage Change
	June 30, 2023			July 1, 2022			2023 vs. 2022			June 30, 2023			July 1, 2022			2023 vs. 2022
Gross profit	$	70,726		$	63,872			10.7	%	$	128,288		$	113,136			13.4	%
Gross margin		76.6	%		78.8	%					77.4	%		78.4	%

Gross profit for the three and six months ended June 30, 2023 increased 10.7% and 13.4%, respectively, from the same periods of 2022. Gross profit margin decreased to 76.6% and 77.4% of revenue for the three and six months ended June 30, 2023, respectively, compared to 78.8% and 78.4% of revenue for the three and six months ended July 1, 2022, respectively, due mainly to reserves related to cataract IOLs.

General and Administrative Expense

The following table presents our general and administrative expenses (dollars in thousands):

	Three Months Ended						Percentage Change			Six Months Ended						Percentage Change
	June 30, 2023			July 1, 2022			2023 vs. 2022			June 30, 2023			July 1, 2022			2023 vs. 2022
General and administrative expense	$	18,097		$	13,983			29.4	%	$	36,195		$	25,923			39.6	%
Percentage of sales		19.6	%		17.2	%					21.8	%		18.0	%

General and administrative expenses for the three months ended June 30, 2023 increased 29.4% from the same period of 2022 due to increased salary-related and payroll tax expenses, outside services and facility costs.

General and administrative expenses for the six months ended June 30, 2023 increased 39.6% from the same period of 2022 due to increased bonus and stock-based compensation expenses, salary-related and payroll tax expenses, Japan one-time employee benefits, outside services, and facility costs.

Selling and Marketing Expense

The following table presents our selling and marketing expenses (dollars in thousands):

	Three Months Ended						Percentage Change			Six Months Ended						Percentage Change
	June 30, 2023			July 1, 2022			2023 vs. 2022			June 30, 2023			July 1, 2022			2023 vs. 2022
Selling and marketing expense	$	32,277		$	24,233			33.2	%	$	58,631		$	41,503			41.3	%
Percentage of sales		35.0	%		29.9	%					35.4	%		28.8	%

Selling and marketing expenses for the three months ended June 30, 2023 increased 33.2% from the same period of 2022 due to increased advertising and promotional activities, especially in the U.S., salary-related and payroll tax expenses, bonus and stock-based compensation expenses, sales commission expenses and trade shows and sales meetings expenses.

Selling and marketing expenses for the six months ended June 30, 2023 increased 41.3% from the same period of 2022 due to increased advertising and promotional activities, especially in the U.S., salary-related and payroll tax expenses, sales commission expenses, trade shows and sales meetings expenses and bonus and stock-based compensation expenses.

20

Research and Development Expense

The following table presents our research and development expenses (dollars in thousands):

	Three Months Ended						Percentage Change			Six Months Ended						Percentage Change
	June 30, 2023			July 1, 2022			2023 vs. 2022			June 30, 2023			July 1, 2022			2023 vs. 2022
Research and development expense	$	11,755		$	8,636			36.1	%	$	22,065		$	16,577			33.1	%
Percentage of sales		12.7	%		10.7	%					13.3	%		11.4	%

Research and development expenses for the three and six months ended June 30, 2023 increased 36.1% and 33.1% from the same period of 2022, respectively, due mainly to increased salary-related and payroll tax expenses and clinical expenses associated with our U.S. post-approval clinical trials, and for the six months ended June 30, 2023, increased bonus and stock-based compensation expenses as compared to the six months ended July 1, 2022.

Other Expense, Net

The following table presents our other expenses, net (dollars in thousands):

	Three Months Ended						Percentage Change			Six Months Ended						Percentage Change
	June 30, 2023			July 1, 2022			2023 vs. 2022			June 30, 2023			July 1, 2022			2023 vs. 2022
Other income (expense), net	$	(105	)	$	(1,551	)		93.2	%	$	1,814		$	(2,137	)		—	*
Percentage of sales		(0.1	)%		(1.9	)%					1.1	%		(1.5	)%

* Denotes change is greater than +100%.

The change in other income (expense), net for the three and six months ended June 30, 2023 and July 1, 2022, respectively, was due to increased interest income mainly due to our investments held available for sale and for the six months ended June 30, 2023 lower foreign exchange losses as compared to the six months ended July 1, 2022.

Income Taxes

The following table presents our income tax provision (dollars in thousands):

	Three Months Ended				Percentage Change			Six Months Ended				Percentage Change
	June 30, 2023		July 1, 2022		2023 vs. 2022			June 30, 2023		July 1, 2022		2023 vs. 2022
Income tax provision	$	2,428	$	2,431		(0.1	)%	$	4,437	$	4,356		1.9	%

The effective tax rates for the three months ended June 30, 2023 and July 1, 2022 were 28.6% and 15.7%, respectively, and were 33.6% and 16.1% for the six months ended June 30, 2023 and July 1, 2022, respectively. Our effective tax rates differ from the U.S. federal statutory rate of 21%, primarily due to the income tax expense generated in foreign jurisdictions.

Our future effective income tax rate depends on various factors, such as changes in tax laws, regulations, accounting principles, or interpretations thereof, and the geographic composition of our pre-tax income. We carefully monitor these factors and adjust our effective income tax rate accordingly.

21

Liquidity and Capital Resources

We believe that current cash and cash equivalents, investments available for sale (“AFS”) and future cash flow from operating activities will be sufficient to meet our anticipated cash needs, including working capital needs, capital expenditures and contractual obligations for at least 12 months from the issuance date of the financial statements included in this quarterly report. Our financial condition at June 30, 2023 and December 30, 2022 included the following (in thousands):

	June 30, 2023		December 30, 2022		2023 vs. 2022
Cash and cash equivalents	$	94,695	$	86,480	$	8,215
Investments available for sale		114,837		139,061		(24,224	)
Total	$	209,532	$	225,541	$	(16,009	)
Current assets	$	328,003	$	311,723	$	16,280
Current liabilities		54,194		51,716		2,478
Working capital	$	273,809	$	260,007	$	13,802

Cash and cash equivalents include cash and balances in deposits and money market accounts held at banks and financial institutions. Our investment policy primary objective is capital preservation while maximizing our return on investment. Investments available for sale may include U.S. government and corporate debt securities, commercial paper, certain certificates deposit and related security types, that are rated by two nationally recognized statistical rating organizations with minimum investment grade ratings of AAA to A-/A-1+ to A-2, or the equivalent. The maturity of individual investments may not extend 24 months from the date of purchase. There are also limits to the amount of credit exposure in any given security type. We do not have any off-balance sheet arrangements.

A summary of cash flows for the six months ended June 30, 2023 and July 1, 2022 was as follows (in thousands):

	Six Months Ended
	June 30, 2023			July 1, 2022
Cash flows from:
Operating activities	$	(11,400	)	$	8,636
Investing activities		20,105			(7,810	)
Financing activities		(59	)		3,101
Effect of exchange rate changes		(431	)		(1,143	)
Net increase in cash and cash equivalents		8,215			2,784
Cash and cash equivalents, at beginning of year		86,480			199,706
Cash and cash equivalents, at end of year	$	94,695		$	202,490

For the six months ended June 30, 2023 net cash used by operating activities consisted of $39.5 million in working-capital changes partially offset by $19.3 million in non-cash items and net income of $8.8 million.

Starting in the second half of 2022, we decided to invest our cash in slightly higher yielding securities. For the six months ended June 30, 2023, net cash provided by investment activities was $20.1 million which consisted of $68.6 million of proceeds from the sale or maturity of investments AFS, partially offset by $42.6 million in purchases of investments AFS and $5.9 million in purchases of property, plant and equipment. For the six months ended July 1, 2022, net cash used in investment activity consisted of $7.8 million in purchases of property, plant and equipment.

Net cash used in financing activities for the six months ended June 30, 2023 was $0.1 million which consisted of $2.0 million to repurchase of employee common stock for taxes withheld and $0.1 million to repay finance lease obligations, offset by $2.0 million of proceeds from the exercise of stock options. For the six months ended July 1, 2022, net cash provided by financing activities consisted of $3.1 million of proceeds from the exercise of stock options.

22

Commitments

Employment Agreements

The Company’s Chief Executive Officer entered into an employment agreement with the Company, effective January 1, 2023. He and certain officers have as provisions of their agreements certain rights, including continuance of cash compensation and benefits, upon a “change in control,” which may include an acquisition of substantially all of its assets, or termination “without cause or for good reason” as defined in the employment agreements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

During the six months ended June 30, 2023, there have been no material changes in the Company’s qualitative and quantitative market risk since the disclosure in the Company’s Annual Report on Form 10-K for the year ended December 30, 2022.

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of our management, including our CEO and CFO, of the effectiveness of the design and operation of the disclosure controls and procedures of the Company. Based on that evaluation, our CEO and CFO concluded, as of the end of the period covered by this quarterly report on Form 10-Q, that our disclosure controls and procedures were effective. For purposes of this statement, the term “disclosure controls and procedures” means controls and other procedures of the Company that are designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Securities Exchange Act (15 U.S.C. 78a et seq.) is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Act is accumulated and communicated to the Company’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Our management, including the CEO and the CFO, do not expect that our disclosure controls and procedures or our internal control over financial reporting will necessarily prevent all fraud or material errors. An internal control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations on all internal control systems, our internal control system can provide only reasonable assurance of achieving its objectives and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any system of internal control is also based in part upon certain assumptions about the likelihood of future events, and can provide only reasonable, not absolute, assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in circumstances, or the degree of compliance with the policies and procedures may deteriorate.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting during the quarter ended June 30, 2023 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

From time to time, the Company is involved in various legal proceedings and other matters arising in the normal course of business. These legal proceedings and other matters may relate to, among other things, contractual rights and obligations, employment matters, or claims of product liability. STAAR maintains insurance coverage for various matters, including product liability and certain securities claims. While the Company does not believe that any of the claims known is likely to have a material adverse effect on the Company’s financial condition or results of operations, new claims or unexpected results of existing claims could lead to significant financial harm.

23

ITEM 1A. RISK FACTORS

Our short and long-term success is subject to many factors that are beyond our control. Investors and prospective investors should consider carefully information contained in this report and the risks and uncertainties described in “Part I—Item 1A—Risk Factors” of the Company’s Form 10-K for the fiscal year ended December 30, 2022. Such risks and uncertainties could materially adversely affect our business, financial condition or operating results.

ITEM 4. MINE SAFETY DISCLOSURES

Not Applicable.

ITEM 5. OTHER INFORMATION

Following our June 15, 2023 Annual Shareholders Meeting, the Board of Directors determined to continue our past practice, supported by the most recent shareholder non-binding advisory vote, to include a shareholder vote on the compensation of executives in our proxy materials every year until the next required vote on the frequency of shareholder votes on the compensation of executives.

(c)Trading Plans

During the quarter ended June 30, 2023, no director or officer adopted or terminated:

(i)Any contract, instruction or written plan for the purchase or sale of securities of the Company intended to satisfy the affirmative defense conditions of Rule 10b51-1(c); and

(ii)Any “non-Rule 10b5-1 trading arrangement” as defined in paragraph (c) of item 408(a) of Regulation S-K.

24

ITEM 6. EXHIBITS

3.1	Amended and Restated Certificate of Incorporation.(1)
3.2	Amended and Restated Bylaws.(2)
4.1	Form of Certificate for Common Stock, par value $0.01 per share.(3)
†4.2	Amended and Restated Omnibus Equity Incentive Plan.(4)
31.1	Certifications Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
31.2	Certifications Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
32.1	Certification Pursuant to 18 U.S.C. Section 1350, Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. **
101	Financial statements from the quarterly report on Form 10-Q of STAAR Surgical Company for the quarter ended June 30, 2023 formatted in Inline Extensible Business Reporting Language (iXBRL), are filed herewith and include: (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of Income, (iii) the Condensed Consolidated Statements of Comprehensive Income, (iv) the Condensed Consolidated Statements of Stockholders’ Equity, (v) the Condensed Consolidated Statements of Cash Flows, and (vi) the Notes to Condensed Consolidated Financial Statements tagged as blocks of text.*
104	The cover page from the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2023, has been formatted in Inline XBRL with applicable taxonomy extension information contained in Exhibit 101.

(1)Incorporated by reference to Appendix 2 of the Company’s Proxy Statement on Form DEF 14A as filed with the Commission on April 13, 2018.

(2)Incorporated by reference to the Company’s Current Report on Form 8-K as filed with the Commission on February 1, 2023.

(3)Incorporated by reference to Exhibit 4.1 to Amendment No. 1 to the Company’s Registration Statement on Form 8‑A/A as filed with the Commission on April 18, 2003.

(4)Incorporated by reference to Exhibit 4.2 to the Company’s Quarterly Report on Form 10-Q, for the period ended July 3, 2020, as filed with the Commission on August 5, 2020.

* Filed herewith.

** Furnished herewith.

† Management contract or compensatory plan.

25

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		STAAR SURGICAL COMPANY
Dated:	August 2, 2023	By:	/s/ PATRICK F. WILLIAMS
			Patrick F. Williams
			Chief Financial Officer
			(on behalf of the Registrant and as its principal financial officer)

26

EX-31.1

Exhibit 31.1

Certifications

I, Thomas G. Frinzi, certify that:

1. I have reviewed this quarterly report on Form 10-Q of STAAR Surgical Company;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated:	August 2, 2023	/s/ THOMAS G. FRINZI
		Thomas G. Frinzi
		President, Chief Executive Officer, and Chair
		of the Board (principal executive officer)

EX-31.2

Exhibit 31.2

Certifications

I, Patrick F. Williams, certify that:

1. I have reviewed this quarterly report on Form 10-Q of STAAR Surgical Company;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated:	August 2, 2023	/s/ PATRICK F. WILLIAMS
		Patrick F. Williams
		Chief Financial Officer
		(principal financial officer)

EX-32.1

Exhibit 32.1

Certification pursuant to 18 U.S.C. Section 1350,

As adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the filing of the Quarterly Report on Form 10-Q for the period ended June 30, 2023 (the “Report”) by STAAR Surgical Company (“Registrant”), each of the undersigned hereby certifies that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Registrant as of and for the periods presented in the Report.

Dated:	August 2, 2023	/s/ THOMAS G. FRINZI
		Thomas G. Frinzi
		President, Chief Executive Officer, Chair
		of the Board (principal executive officer)

Dated:	August 2, 2023	/s/ PATRICK F. WILLIAMS
		Patrick F. Williams
		Chief Financial Officer
		(principal financial officer)

A signed original of this written statement required by 18U.S.C. Section 1350has been provided to STAAR Surgical Company and will be furnished to the Securities and Exchange Commission or its staff upon request.

XML

Document And Entity Information - shares	6 Months Ended
	Jun. 30, 2023	Jul. 28, 2023
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2023
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q1
Entity Registrant Name	STAAR Surgical Company
Entity Central Index Key	0000718937
Current Fiscal Year End Date	--12-29
Entity Filer Category	Large Accelerated Filer
Trading Symbol	STAA
Entity Common Stock, Shares Outstanding		48,499,892
Entity Emerging Growth Company	false
Entity Small Business	false
Entity Current Reporting Status	Yes
Entity Shell Company	false
Entity Interactive Data Current	Yes
Entity File Number	0-11634
Title of 12(b) Security	Common
Security Exchange Name	NASDAQ
Entity Tax Identification Number	95-3797439
Entity Address, Address Line One	25651 Atlantic Ocean Drive
Entity Address, City or Town	Lake Forest
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	92630
City Area Code	626
Local Phone Number	303-7902
Entity Incorporation, State or Country Code	DE
Document Quarterly Report	true
Document Transition Report	false

XML

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 30, 2022
Current assets:
Cash and cash equivalents	$ 94,695	$ 86,480
Investments available for sale	97,312	125,159
Accounts receivable trade, net of allowance for credit losses of $31 and $20, respectively	94,442	62,447
Inventories, net	25,482	24,161
Prepayments, deposits and other current assets	16,072	13,476
Total current assets	328,003	311,723
Investments available for sale	17,525	13,902
Property, plant and equipment, net	55,924	50,921
Finance lease right-of-use assets, net	257	342
Operating lease right-of-use assets, net	31,530	30,270
Intangible assets, net		173
Goodwill	1,786	1,786
Deferred income taxes	4,672	4,824
Other assets	954	957
Total assets	440,651	414,898
Current liabilities:
Accounts payable	11,441	11,576
Obligations under finance leases	162	169
Obligations under operating leases	4,013	3,524
Allowance for sales returns	6,653	5,706
Other current liabilities	31,925	30,741
Total current liabilities	54,194	51,716
Obligations under finance leases	125	210
Obligations under operating leases	28,189	27,136
Deferred income taxes	1,295	1,489
Asset retirement obligations	101	220
Pension liability	3,050	1,935
Total liabilities	86,954	82,706
Commitments and contingencies
Stockholders’ equity:
Common stock, $0.01 par value; 60,000 shares authorized: 48,499 and 48,212 shares issued and outstanding at June 30, 2023 and December 30, 2022, respectively	485	482
Additional paid-in capital	419,594	404,189
Accumulated other comprehensive gain (loss)	(2,521)	156
Accumulated deficit	(63,861)	(72,635)
Total stockholders’ equity	353,697	332,192
Total liabilities and stockholders’ equity	$ 440,651	$ 414,898

XML

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 30, 2022
Statement of Financial Position [Abstract]
Allowance for credit losses, current	$ 31	$ 20
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	60,000,000	60,000,000
Common stock, shares issued	48,499,000	48,212,000
Common stock, shares outstanding	48,499,000	48,212,000

XML

CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jul. 01, 2022	Jun. 30, 2023	Jul. 01, 2022
Income Statement [Abstract]
Net sales	$ 92,306	$ 81,101	$ 165,834	$ 144,301
Cost of sales	21,580	17,229	37,546	31,165
Gross profit	70,726	63,872	128,288	113,136
Selling, general and administrative expenses:
General and administrative	18,097	13,983	36,195	25,923
Selling and marketing	32,277	24,233	58,631	41,503
Research and development	11,755	8,636	22,065	16,577
Total selling, general and administrative expenses	62,129	46,852	116,891	84,003
Operating income	8,597	17,020	11,397	29,133
Other income (expense), net:
Interest income, net	1,775	43	3,597	37
Loss on foreign currency transactions	(1,890)	(1,860)	(1,856)	(2,775)
Royalty income		177		450
Other income, net	10	89	73	151
Total other income (expense), net	(105)	(1,551)	1,814	(2,137)
Income before income taxes	8,492	15,469	13,211	26,996
Provision for income taxes	2,428	2,431	4,437	4,356
Net income	$ 6,064	$ 13,038	$ 8,774	$ 22,640
Net income per share:
Basic	$ 0.13	$ 0.27	$ 0.18	$ 0.47
Diluted	$ 0.12	$ 0.26	$ 0.18	$ 0.46
Weighted average shares outstanding:
Basic	48,418	47,889	48,333	47,822
Diluted	49,516	49,223	49,524	49,264

XML

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jul. 01, 2022	Jun. 30, 2023	Jul. 01, 2022
Statement of Comprehensive Income [Abstract]
Net Income (Loss)	$ 6,064	$ 13,038	$ 8,774	$ 22,640
Defined benefit plans:
Net change in plan assets	(547)	2,593	(1,724)	6,661
Reclassification into other income (expense), net	(51)	33	(103)	85
Investments available for sale:
Change in unrealized gain (loss)	(142)		(26)
Reclassification into other income (expense), net			(2)
Foreign currency translation gain (loss)	(1,342)	(1,502)	(1,471)	(2,516)
Tax effect	498	188	649	67
Other comprehensive income (loss), net of tax	(1,584)	1,312	(2,677)	4,297
Comprehensive income	$ 4,480	$ 14,350	$ 6,097	$ 26,937

XML

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Income (Loss)	Accumulated Deficit
Balance at Dec. 31, 2021	$ 258,558	$ 477	$ 373,519	$ (4,048)	$ (111,390)
Balance (in shares) at Dec. 31, 2021		47,716
Net Income (Loss)	22,640				22,640
Other comprehensive income (loss)	4,297			4,297
Common stock issued upon exercise of options	3,146	$ 3	3,143
Common stock issued upon exercise of options (in shares)		251
Stock-based compensation	$ 10,666		10,666
Unvested restricted stock (in shares)	4	7
Vested restricted and performance stock (in shares)		50
Balance at Jul. 01, 2022	$ 299,307	$ 480	387,328	249	(88,750)
Balance (in shares) at Jul. 01, 2022		48,024
Balance at Apr. 01, 2022	276,317	$ 478	378,690	(1,063)	(101,788)
Balance (in shares) at Apr. 01, 2022		47,810
Net Income (Loss)	13,038				13,038
Other comprehensive income (loss)	1,312			1,312
Common stock issued upon exercise of options	2,234	$ 2	2,232
Common stock issued upon exercise of options (in shares)		202
Stock-based compensation	$ 6,406		6,406
Unvested restricted stock (in shares)	4	7
Vested restricted and performance stock (in shares)		5
Balance at Jul. 01, 2022	$ 299,307	$ 480	387,328	249	(88,750)
Balance (in shares) at Jul. 01, 2022		48,024
Balance at Dec. 30, 2022	332,192	$ 482	404,189	156	(72,635)
Balance (in shares) at Dec. 30, 2022		48,212
Net Income (Loss)	8,774				8,774
Other comprehensive income (loss)	(2,677)			(2,677)
Common stock issued upon exercise of options	$ 2,006	$ 2	2,004
Common stock issued upon exercise of options (in shares)	195	195
Stock-based compensation	$ 15,385		15,385
Repurchase of employee common stock for taxes withheld	$ (1,984)		(1,984)
Repurchase of employee common stock for taxes withheld (in shares)		(34)
Unvested restricted stock (in shares)	10	10
Vested restricted and performance stock	$ 1	$ 1
Vested restricted and performance stock (in shares)		116
Balance at Jun. 30, 2023	353,697	$ 485	419,594	(2,521)	(63,861)
Balance (in shares) at Jun. 30, 2023		48,499
Balance at Mar. 31, 2023	338,924	$ 483	409,303	(937)	(69,925)
Balance (in shares) at Mar. 31, 2023		48,331
Net Income (Loss)	6,064				6,064
Other comprehensive income (loss)	(1,584)			(1,584)
Common stock issued upon exercise of options	1,477	$ 2	1,475
Common stock issued upon exercise of options (in shares)		155
Stock-based compensation	8,951		8,951
Repurchase of employee common stock for taxes withheld	$ (135)		(135)
Repurchase of employee common stock for taxes withheld (in shares)		(3)
Unvested restricted stock (in shares)	10	10
Vested restricted and performance stock (in shares)		6
Balance at Jun. 30, 2023	$ 353,697	$ 485	$ 419,594	$ (2,521)	$ (63,861)
Balance (in shares) at Jun. 30, 2023		48,499

XML

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jul. 01, 2022
Cash flows from operating activities:
Net Income (Loss)	$ 8,774	$ 22,640
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation of property, plant, and equipment	2,398	2,024
Amortization of intangibles	171	15
Accretion/Amortization of investments available for sale	(1,824)
Deferred income taxes	75
Change in net pension liability	(627)	52
Loss on disposal of property and equipment	24
Stock-based compensation expense	14,488	9,648
Change in asset retirement obligation	(107)
Provision for sales returns and bad debts	1,004	800
Inventory provision	3,630	1,428
Changes in working capital:
Accounts receivable	(32,344)	(20,137)
Inventories	(4,382)	(1,825)
Prepayments, deposits, and other current assets	(2,665)	(2,260)
Accounts payable	(1,447)	3,243
Other current liabilities	1,432	(6,992)
Net cash provided by (used in) operating activities	(11,400)	8,636
Cash flows from investing activities:
Acquisition of property and equipment	(5,915)	(7,810)
Purchase of investments available for sale	(42,602)
Proceeds from sale or maturity of investments available for sale	68,622
Net cash provided by (used in) investing activities	20,105	(7,810)
Cash flows from financing activities:
Repayment of finance lease obligations	(82)	(45)
Repurchase of employee common stock for taxes withheld	(1,984)
Proceeds from the exercise of stock options	2,006	3,146
Proceeds from vested restricted stock	1
Net cash provided by (used in) financing activities	(59)	3,101
Effect of exchange rate changes on cash and cash equivalents	(431)	(1,143)
Increase in cash and cash equivalents	8,215	2,784
Cash and cash equivalents, at beginning of the period	86,480	199,706
Cash and cash equivalents, at end of the period	$ 94,695	$ 202,490

XML

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jul. 01, 2022	Jun. 30, 2023	Jul. 01, 2022
Pay vs Performance Disclosure
Net Income (Loss)	$ 6,064	$ 13,038	$ 8,774	$ 22,640

XML

Insider Trading Arrangements	6 Months Ended
	Jun. 30, 2023
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

XML

Basis of Presentation and Significant Accounting Policies

6 Months Ended

Jun. 30, 2023

Accounting Policies [Abstract]

Basis of Presentation and Significant Accounting Policies

Note 1 — Basis of Presentation and Significant Accounting Policies

The Condensed Consolidated Financial Statements of the Company present the financial position, results of operations, and cash flows of STAAR Surgical Company and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X of the Securities Exchange Commission. In accordance with those rules and regulations certain information and footnote disclosures normally included in the Comprehensive Financial Statements have been condensed or omitted pursuant to such rules and regulations. The Consolidated Balance Sheet as of December 30, 2022 was derived from the audited financial statements at that date, but does not include all the information and footnotes required by GAAP. These financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 30, 2022.

The Condensed Consolidated Financial Statements for the three and six months ended June 30, 2023 and July 1, 2022, in the opinion of management, include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the Company’s financial condition and results of operations. The results of operations for the three and six months ended June 30, 2023 and July 1, 2022, are not necessarily indicative of the results to be expected for any other interim period or for the entire year.

Each of the Company’s fiscal reporting periods ends on the Friday nearest to the quarter ending date and generally consists of 13 weeks. Unless the context indicates otherwise “we,” “us,” the “Company,” and “STAAR” refer to STAAR Surgical Company and its consolidated subsidiaries.

Vendor Concentration

There was one vendor that accounted for over 10% of the Company’s consolidated accounts payable as of June 30, 2023. There were no vendors that accounted for over 10% of the Company’s consolidated accounts payable as of December 30, 2022.

XML

Investments Available for Sale

6 Months Ended

Jun. 30, 2023

Investments, Debt and Equity Securities [Abstract]

Investments Available for Sale

Note 2 — Investments Available for Sale

During the second half of 2022, the Company started to invest its cash in slightly higher yielding securities. Investments available for sale (“AFS”) and the related fair value measurement consisted of the following (dollars in thousands):

	June 30, 2023
										Fair Value Measurements
	Amortized Cost		Unrealized Gains		Unrealized Losses			Estimated Fair Value		Level 1		Level 2
Commercial paper	$	28,519	$	—	$	(19	)	$	28,500	$	—	$	28,500
Certificates of deposit		10,774		1		(13	)		10,762		—		10,762
U.S. Treasury securities		30,318		—		(203	)		30,115		30,115		—
U.S. agency securities		11,034		—		(32	)		11,002		—		11,002
Corporate debt securities		34,625		3		(170	)		34,458		—		34,458
Total investments AFS	$	115,270	$	4	$	(437	)	$	114,837	$	30,115	$	84,722
	December 30, 2022
										Fair Value Measurements
	Amortized Cost		Unrealized Gains		Unrealized Losses			Estimated Fair Value		Level 1		Level 2
Commercial paper	$	44,054	$	11	$	(62	)	$	44,003	$	—	$	44,003
Certificates of deposit		17,355		4		(75	)		17,284		—		17,284
U.S. Treasury securities		21,847		3		(15	)		21,835		21,835		—
U.S. agency securities		10,688		16		(3	)		10,701		—		10,701
Corporate debt securities		45,522		4		(288	)		45,238		—		45,238
Total investments AFS	$	139,466	$	38	$	(443	)	$	139,061	$	21,835	$	117,226

Note 2 — Investments Available for Sale (Continued)

The Company obtains the fair value from third-party pricing services. The pricing services utilize industry standard valuation models, including both income and market-based approaches and observable market inputs to determine value. These observable market inputs include reportable trades, benchmark yields, credit spreads, broker/dealer quotes, bids, offers and other industry and economic events.

The Company assessed each debt security with gross unrealized losses for impairment. As part of that assessment, the Company concluded that it does not intend to sell and it is more-likely-than-not that the Company will not be required to sell, prior to the recovery of the amortized cost basis. The Company did not recognize impairment for the three and six months ended June 30, 2023.

The following table shows the fair value of investments AFS by contractual maturity (dollars in thousands):

	As of June 30, 2023
	Within one year		After one year through five years		Total
Commercial paper	$	28,500	$	—	$	28,500
Certificates of deposit		10,762		—		10,762
U.S. Treasury securities		16,613		13,502		30,115
U.S. agency securities		10,030		972		11,002
Corporate debt securities		31,407		3,051		34,458
Total investments AFS	$	97,312	$	17,525	$	114,837

During the six months ended June 30, 2023, the Company sold $600,000 in securities during the first quarter of 2023 due to a downgraded credit rating. The Company recognized a realized gain upon sale of $2,000 during the six months ended June 30, 2023.

XML

Inventories

6 Months Ended

Jun. 30, 2023

Inventory Disclosure [Abstract]

Inventories

Note 3 — Inventories

Inventories, net are stated at the lower of cost and net realizable value, determined on a first-in, first-out basis and consisted of the following (in thousands):

	June 30, 2023			December 30, 2022
Raw materials and purchased parts	$	7,341		$	6,703
Work in process		5,865			5,499
Finished goods		16,502			13,633
Total inventories, gross		29,708			25,835
Less inventory reserves		(4,226	)		(1,674	)
Total inventories, net	$	25,482		$	24,161

XML

Prepayments, Deposits, and Other Current Assets

6 Months Ended

Jun. 30, 2023

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Prepayments, Deposits, and Other Current Assets

Note 4 — Prepayments, Deposits, and Other Current Assets

Prepayments, deposits, and other current assets consisted of the following (in thousands):

	June 30, 2023		December 30, 2022
Prepayments and deposits	$	4,968	$	3,986
Prepaid insurance		1,190		2,620
Prepaid marketing costs		3,353		2,534
Consumption tax receivable		802		864
Value added tax (VAT) receivable		3,880		2,661
BVG (Swiss Pension) prepayment		1,211		111
Other(1)		668		700
Total prepayments, deposits and other current assets	$	16,072	$	13,476

(1)No individual category in “other current assets” exceeds 5% of the total prepayments, deposits and other current assets.

XML

Property, Plant and Equipment

6 Months Ended

Jun. 30, 2023

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment

Note 5 — Property, Plant and Equipment

Property, plant and equipment, net consisted of the following (in thousands):

	June 30, 2023			December 30, 2022
Machinery and equipment	$	29,836		$	28,026
Computer equipment and software		9,591			9,266
Furniture and fixtures		4,491			4,276
Leasehold improvements		16,840			14,965
Construction in process		35,109			32,269
Total property, plant and equipment, gross		95,867			88,802
Less accumulated depreciation		(39,943	)		(37,881	)
Total property, plant and equipment, net	$	55,924		$	50,921

XML

Intangible Assets

6 Months Ended

Jun. 30, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets

Note 6 – Intangible Assets

Intangible assets, net consisted of the following (in thousands):

	June 30, 2023							December 30, 2022
Long-lived amortized intangible assets	Gross Carrying Amount		Accumulated Amortization			Net		Gross Carrying Amount		Accumulated Amortization			Net
Patents and licenses	$	9,195	$	(9,195	)	$	—	$	9,240	$	(9,067	)	$	173

During the three and six months ended June 30, 2023, the Company recognized full impairment of $154,000 for its Japan patents and licenses related to cataract IOLs.

XML

Other Current Liabilities

6 Months Ended

Jun. 30, 2023

Other Liabilities Disclosure [Abstract]

Other Current Liabilities

Note 7 – Other Current Liabilities

Other current liabilities consisted of the following (in thousands):

	June 30, 2023		December 30, 2022
Accrued salaries and wages	$	11,511	$	10,862
Accrued bonuses		1,707		6,925
Income taxes payable		7,202		3,845
Marketing obligations		1,354		1,374
Other(1)		10,151		7,735
Total other current liabilities	$	31,925	$	30,741

(1)No individual category in “Other” exceeds 5% of the other current liabilities.

XML

Leases

6 Months Ended

Jun. 30, 2023

Leases [Abstract]

Leases

Note 8 – Leases

Finance Leases

The Company entered into finance leases primarily related to purchases of equipment used for manufacturing, computer-related equipment or furniture and fixtures. These finance leases are two to five years in length and have fixed payment amounts for the term of the contract and have options to purchase the assets at the end of the lease term. Supplemental balance sheet information related to finance leases consisted of the following (dollars in thousands):

Note 8 – Leases (Continued)

Finance Leases (Continued)

	June 30, 2023			December 30, 2022
Machinery and equipment	$	—		$	30
Computer equipment and software		6			18
Furniture and fixtures		475			475
Finance lease right-of-use assets, gross		481			523
Less accumulated depreciation		(224	)		(181	)
Finance lease right-of-use assets, net	$	257		$	342
Current finance lease obligations	$	162		$	169
Long-term finance lease obligations		125			210
Total finance lease liability	$	287		$	379
Weighted-average remaining lease term (in years)		1.8			2.2
Weighted-average discount rate		4.23	%		4.10	%

Supplemental cash flow information related to finance leases consisted of the following (dollars in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Amortization of finance lease right-of-use asset	$	38	$	39	$	77	$	82
Interest on finance lease liabilities		3		5		7		8
Cash paid for amounts included in the measurement of finance lease liabilities:
Operating cash flows		3		5		7		8
Financing cash flows		40		27		82		45

Operating Leases

The Company entered into operating leases primarily related to real property (office, manufacturing and warehouse facilities), automobiles and copiers. These operating leases are two to ten years in length with options to extend. The Company does not include any lease extensions in the initial valuation unless the Company was reasonably certain to extend the lease. Depending on the lease, there are those with fixed payment amounts for the entire length of the contract or payments which increase periodically as noted in the contract or increased at an inflation rate indicator. For operating leases that increase using an inflation rate indicator, the Company used the inflation rate at the time the lease was entered into for the length of the lease term. Supplemental balance sheet information related to operating leases consisted of the following (dollars in thousands):

	June 30, 2023			December 30, 2022
Machinery and equipment	$	752		$	789
Computer equipment and software		446			446
Real property		36,756			34,465
Operating lease right-of-use assets, gross		37,954			35,700
Less accumulated depreciation		(6,424	)		(5,430	)
Operating lease right-of-use assets, net	$	31,530		$	30,270
Current operating lease obligations	$	4,013		$	3,524
Long-term operating lease obligations		28,189			27,136
Total operating lease liability	$	32,202		$	30,660
Weighted-average remaining lease term (in years)		7.2			7.5
Weighted-average discount rate		4.44	%		3.87	%

Note 8 – Leases (Continued)

Operating Leases (Continued)

Supplemental cash flow information related to operating leases was as follows (dollars in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Operating lease cost	$	1,357	$	1,166	$	2,464	$	2,304
Cash paid for amounts included in the measurement of operating lease liabilities:
Operating cash flows		1,152		1,034		2,325		1,966
Right-of-use assets obtained in exchange for new operating lease liabilities		1,511		2,081		3,420		2,756

Future Maturities of Lease Liabilities

Estimated future maturities of lease liabilities under operating and finance leases having initial or remaining non-cancelable lease terms more than one year as of June 30, 2023 is as follows (in thousands):

.

As of June 30, 2023 12 Months Ended	Operating Leases			Finance Leases
June 2024	$	5,990		$	171
June 2025		5,834			127
June 2026		4,463			—
June 2027		4,432			—
June 2028		4,476			—
Thereafter		13,433			—
Total future minimum lease payments	$	38,628		$	298
Less amounts representing interest		(6,426	)		(11	)
Total lease liability	$	32,202		$	287

XML

Income Taxes

6 Months Ended

Jun. 30, 2023

Income Tax Disclosure [Abstract]

Income Taxes

Note 9 — Income Taxes

The Company recorded an income tax provision as follows (in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Provision for income taxes	$	2,428	$	2,431	$	4,437	$	4,356

The effective tax rates for the three months ended June 30, 2023 and July 1, 2022 were 28.6% and 15.7%, respectively, and were 33.6% and 16.1% for the six months ended June 30, 2023 and July 1, 2022, respectively. The Company’s effective tax rates differ from the U.S. federal statutory rate of 21% for the three and six months ended June 30, 2023 and July 1, 2022, respectively, primarily due to the income tax expense generated in foreign jurisdictions.

XML

Defined Benefit Pension Plans

6 Months Ended

Jun. 30, 2023

Retirement Benefits [Abstract]

Defined Benefit Pension Plans

Note 10 – Defined Benefit Pension Plans

The Company has defined benefit plans covering employees of its Switzerland and Japan operations. The following table summarizes the components of net periodic pension cost recorded for the Company’s defined benefit pension plans (in thousands):

	Three Months Ended						Six Months Ended
	June 30, 2023			July 1, 2022			June 30, 2023			July 1, 2022
Service cost(1)	$	254		$	309		$	503		$	635
Interest cost(2)		90			21			177			41
Expected return on plan assets(2)		(91	)		(123	)		(178	)		(241	)
Prior service credit(2),(3)		(45	)		(46	)		(90	)		(91	)
Actuarial loss recognized in current period(2),(3)		(6	)		79			(13	)		176
Net periodic pension cost	$	202		$	240		$	399		$	520

(1)Recognized in selling general and administrative expenses on the Condensed Consolidated Statements of Income.

(2)Recognized in other expense, net on the Condensed Consolidated Statements of Income.

(3)Amounts reclassified from accumulated other comprehensive income (loss).

The Company currently is not required to and does not make contributions to its Japan pension plan. The Company’s contributions to its Swiss pension plan are as follows (in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Employer contribution	$	245	$	220	$	462	$	436

XML

Stockholders' Equity

6 Months Ended

Jun. 30, 2023

Stockholders' Equity Note [Abstract]

Stockholders' Equity

Note 11 — Stockholders’ Equity

Stock-Based Compensation

The cost that has been charged against income for stock-based compensation is set forth below (in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Employee stock options	$	3,479	$	2,457	$	6,456	$	4,784
Restricted stock		79		442		146		551
Restricted stock units		2,148		1,231		3,749		1,993
Performance stock units		2,403		1,310		3,509		1,692
Nonemployee stock options		314		314		628		628
Total stock-based compensation expense	$	8,423	$	5,754	$	14,488	$	9,648

The Company recorded stock-based compensation costs in the following categories (in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Cost of sales	$	223	$	106	$	372	$	176
General and administrative		3,695		2,806		7,058		4,587
Selling and marketing		2,492		1,324		3,349		2,213
Research and development		2,013		1,518		3,709		2,672
Total stock-based compensation expense, net		8,423		5,754		14,488		9,648
Amounts capitalized as part of inventory		528		652		897		1,018
Total stock-based compensation expense, gross	$	8,951	$	6,406	$	15,385	$	10,666

Note 11 — Stockholders’ Equity (Continued)

Incentive Plan

The Amended and Restated Omnibus Equity Incentive Plan (“the Plan”) provides for various forms of stock-based incentives. To date, of the available forms of awards under the Plan, the Company has granted only stock options, restricted stock, unrestricted share grants, restricted stock units (“RSUs”) and performance stock units (“PSUs”). Options under the Plan are granted at fair market value on the date of grant, become exercisable generally over a three-year period, or as determined by the Board of Directors, and expire over periods not exceeding 10 years from the date of grant. Certain option and share awards provide for accelerated vesting if there is a change in control and pre-established financial metrics are met (as defined in the Plan). Grants of restricted stock outstanding under the Plan generally vest over periods of one to three years. Grants of RSUs and PSUs outstanding under the Plan generally vest based on service, performance, or a combination of both. On June 15, 2023, stockholders approved a proposal to increase the number of shares under the plan by 2,170,000 shares, for a total of 20,205,000 shares. As of June 30, 2023, there were 2,844,500 shares available for grant under the Plan.

Assumptions

The fair value of each option award is estimated on the date of grant using a Black-Scholes option valuation model applying the weighted-average assumptions noted in the following table. Expected volatilities are based on historical volatility of the Company’s stock. The expected term of options granted is derived from the historical exercises and post-vesting cancellations and represents the period of time that options granted are expected to be outstanding. The Company has calculated a 7% estimated forfeiture rate based on historical forfeiture experience. The risk-free rate is based on the U.S. Treasury yield curve corresponding to the expected term at the time of the grant.

	Three Months Ended						Six Months Ended
	June 30, 2023			July 1, 2022			June 30, 2023			July 1, 2022
Expected dividend yield		0	%		0	%		0	%		0	%
Expected volatility		58	%		54	%		59	%		54	%
Risk-free interest rate		3.41	%		3.27	%		3.87	%		1.83	%
Expected term (in years)		4.87			5.10			5.02			5.10

Stock Options

A summary of stock option activity under the Plan for six months ended June 30, 2023 is presented below:

	Stock Options (in 000’s)			Minimum Exercise Price		Maximum Exercise Price
Outstanding at December 30, 2022		2,469
Granted		584
Exercised		(195	)
Forfeited or expired		(31	)
Outstanding at June 30, 2023		2,827		$	5.54	$	154.96
Exercisable at June 30, 2023		1,903

Restricted Stock, Restricted Stock Units and Performance Stock Units

A summary of restricted stock, RSUs and PSUs activity under the Plan for the six months ended June 30, 2023 is presented below (shares in thousands):

	Restricted Stock			RSUs			PSUs
Unvested at December 30, 2022		4			192			118
Granted		10			259			178
Vested		(4	)		(80	)		(36	)
Forfeited or expired		—			(6	)		(11	)
Unvested at June 30, 2023		10			365			249

XML

Commitments and Contingencies

6 Months Ended

Jun. 30, 2023

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Note 12 - Commitments and Contingencies

Severance Payable

As of June 30, 2023 and December 30, 2022 there was severance payable of $508,000 and $410,000, respectively. recognized in other current liabilities on the Consolidated Balance Sheets, which included approximately $341,000 and $300,000, respectively, in one-time employee benefits to be paid to certain employees in STAAR Japan who work primarily in IOL sales. During the three and six months ended June 30, 2023, the Company recognized $159,000 and $1,351,000, respectively, related to this. The Company is expected to incur through the end of 2023, one-time employee benefits of approximately $1,440,000 related to this. These one-time employee benefits are recognized in general and administrative expense on the Consolidated Statements of Income.

Litigation and Claims

From time to time, the Company is involved in various legal proceedings and other matters arising in the normal course of business. These legal proceedings and other matters may relate to, among other things, contractual rights and obligations, employment matters, or claims of product liability. STAAR maintains insurance coverage for various matters, including product liability and certain securities claims. While the Company does not believe that any of the claims known is likely to have a material adverse effect on the Company’s financial condition or results of operations, new claims or unexpected results of existing claims could lead to significant financial harm.

Employment Agreements

The Company’s Chief Executive Officer entered into an employment agreement with the Company, effective January 1, 2023. He and certain officers have as provisions of their agreements certain rights, including continuance of cash compensation and benefits, upon a “change in control,” which may include an acquisition of substantially all its assets, or termination “without cause or for good reason” as defined in the employment agreements.

XML

Basic and Diluted Net Income Per Share

6 Months Ended

Jun. 30, 2023

Earnings Per Share [Abstract]

Basic and Diluted Net Income Per Share

Note 13 — Basic and Diluted Net Income Per Share

The following table sets forth the computation of basic and diluted net income per share (in thousands except per share amounts):

	Three Months Ended						Six Months Ended
	June 30, 2023			July 1, 2022			June 30, 2023			July 1, 2022
Numerator:
Net income	$	6,064		$	13,038		$	8,774		$	22,640
Denominator:
Weighted average common shares:
Common shares outstanding		48,428			47,893			48,343			47,826
Less: Unvested restricted stock		(10	)		(4	)		(10	)		(4	)
Denominator for basic calculation		48,418			47,889			48,333			47,822
Weighted average effects of potentially diluted common stock:
Stock options		986			1,299			1,050			1,386
Unvested restricted stock		3			3			3			2
RSUs		46			24			77			45
PSUs		63			8			61			9
Denominator for diluted calculation		49,516			49,223			49,524			49,264
Net income per share:
Basic	$	0.13		$	0.27		$	0.18		$	0.47
Diluted	$	0.12		$	0.26		$	0.18		$	0.46

The following table sets forth (in thousands) the weighted average number of options to purchase shares of common stock, restricted stock, RSUs and PSUs with either exercise prices or unrecognized compensation cost per share greater than the average market price per share of the Company’s common stock, which were not included in the calculation of diluted per share amounts because the effects would be anti-dilutive.

Note 13 — Basic and Diluted Net Income Per Share (Continued)

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Stock options		1,874		1,153		1,625		862
Restricted stock, RSUs and PSUs		127		267		24		122
Total		2,001		1,420		1,649		984

XML

Disaggregation of Sales, Geographic Sales and Product Sales

6 Months Ended

Jun. 30, 2023

Segment Reporting [Abstract]

Disaggregation of Sales, Geographic Sales and Product Sales

Note 14 — Disaggregation of Sales, Geographic Sales and Product Sales

In the following tables, sales are disaggregated by category, sales by geographic market and sales by product data. The following breaks down sales into the following categories (in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Non-consignment sales	$	88,068	$	76,444	$	155,231	$	134,013
Consignment sales		4,238		4,657		10,603		10,288
Total net sales		92,306		81,101	$	165,834	$	144,301

The Company markets and sells its products in over 75 countries and conducts its manufacturing in the United States. Other than China and Japan, the Company does not conduct business in any country in which its sales exceed 10% of worldwide consolidated net sales. Sales are attributed to countries based on location of customers. The composition of the Company’s net sales to unaffiliated customers was as follows (in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Domestic	$	4,346	$	3,872	$	8,897	$	6,502
Foreign:
China		61,339		46,150		96,429		74,389
Japan		8,415		10,302		19,351		21,935
Other(1)		18,206		20,777		41,157		41,475
Total foreign sales		87,960		77,229		156,937		137,799
Total net sales	$	92,306	$	81,101	$	165,834	$	144,301

(1)No other location individually exceeds 10% of the total sales.

100% of the Company’s sales are generated from the ophthalmic surgical product segment and the chief operating decision maker makes operating decisions and allocates resources based upon the consolidated operating results, and therefore the Company operates as one operating segment for financial reporting purposes. The Company’s principal products are implantable Collamer lenses (“ICLs”) used in refractive surgery and intraocular lenses (“IOLs”) used in cataract surgery. The composition of the Company’s net sales by product line was as follows (in thousands):

	Three Months Ended					Six Months Ended
	June 30, 2023			July 1, 2022		June 30, 2023		July 1, 2022
ICLs	$	93,112		$	77,922	$	163,737	$	136,597
Other product sales:
Cataract IOLs		40			2,547		1,516		5,449
Other surgical products(1)		(846	)		632		581		2,255
Total other product sales		(806	)		3,179		2,097		7,704
Total net sales	$	92,306		$	81,101	$	165,834	$	144,301

(1) Other surgical products include delivery systems and normal recurring sales adjustments such as sales return allowances.

Note 14 — Disaggregation of Sales, Geographic Sales and Product Sales (Continued)

One customer, the Company’s distributor in China, accounted for 66% and 57% of net sales for the three months ended June 30, 2023 and July 1, 2022, respectively, and the same customer accounted for 58% and 52% for the six months ended June 30, 2023 and July 1, 2022, respectively. As of June 30, 2023 and December 30, 2022, respectively, one customer, the Company’s distributor in China, accounted for 74% and 59% of consolidated trade receivables.

XML

COVID-19 Developments

6 Months Ended

Jun. 30, 2023

C O V I D19 Developments [Abstract]

COVID-19 Developments

Note 15 — COVID-19 Developments

In December 2019, COVID-19 surfaced and in March 2020, the World Health Organization declared a pandemic related to the rapid spread of COVID-19 around the world. The impact of the COVID-19 outbreak on the businesses and the economy in the U.S. and the rest of the world is, and is expected to continue to be, uncertain and may continue to be significant as COVID-19 variant strains emerge. The Company’s revenues have been adversely impacted, and the Company experienced a substantial slowdown in sales beginning March 20, 2020 in global geographies characterized as “hot spots” for the COVID-19 virus, including parts of Europe, North America, Asia, the Middle East and India. In certain of these markets, sales have paused as elective surgeries are discouraged to support COVID-19 related needs. While COVID-19 restrictions have since eased globally during 2022, a resurgence of the COVID-19 pandemic in global geographies, depending upon its duration and severity, could material adversely impact the global economy and the Company's industry, operations and financial condition and performance. The Company continues to monitor the commercial and operational impact of new variants of COVID-19 in its markets.

XML

Basis of Presentation and Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2023

Accounting Policies [Abstract]

Basis of Presentation

The Condensed Consolidated Financial Statements of the Company present the financial position, results of operations, and cash flows of STAAR Surgical Company and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X of the Securities Exchange Commission. In accordance with those rules and regulations certain information and footnote disclosures normally included in the Comprehensive Financial Statements have been condensed or omitted pursuant to such rules and regulations. The Consolidated Balance Sheet as of December 30, 2022 was derived from the audited financial statements at that date, but does not include all the information and footnotes required by GAAP. These financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 30, 2022.

The Condensed Consolidated Financial Statements for the three and six months ended June 30, 2023 and July 1, 2022, in the opinion of management, include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the Company’s financial condition and results of operations. The results of operations for the three and six months ended June 30, 2023 and July 1, 2022, are not necessarily indicative of the results to be expected for any other interim period or for the entire year.

Each of the Company’s fiscal reporting periods ends on the Friday nearest to the quarter ending date and generally consists of 13 weeks. Unless the context indicates otherwise “we,” “us,” the “Company,” and “STAAR” refer to STAAR Surgical Company and its consolidated subsidiaries.

Vendor Concentration

There was one vendor that accounted for over 10% of the Company’s consolidated accounts payable as of June 30, 2023. There were no vendors that accounted for over 10% of the Company’s consolidated accounts payable as of December 30, 2022.

XML

Investments Available for Sale (Tables)

6 Months Ended

Jun. 30, 2023

Investments, Debt and Equity Securities [Abstract]

Summary of Investments Available for Sale and Related Fair Value Measurement

Investments available for sale (“AFS”) and the related fair value measurement consisted of the following (dollars in thousands):

	June 30, 2023
										Fair Value Measurements
	Amortized Cost		Unrealized Gains		Unrealized Losses			Estimated Fair Value		Level 1		Level 2
Commercial paper	$	28,519	$	—	$	(19	)	$	28,500	$	—	$	28,500
Certificates of deposit		10,774		1		(13	)		10,762		—		10,762
U.S. Treasury securities		30,318		—		(203	)		30,115		30,115		—
U.S. agency securities		11,034		—		(32	)		11,002		—		11,002
Corporate debt securities		34,625		3		(170	)		34,458		—		34,458
Total investments AFS	$	115,270	$	4	$	(437	)	$	114,837	$	30,115	$	84,722
	December 30, 2022
										Fair Value Measurements
	Amortized Cost		Unrealized Gains		Unrealized Losses			Estimated Fair Value		Level 1		Level 2
Commercial paper	$	44,054	$	11	$	(62	)	$	44,003	$	—	$	44,003
Certificates of deposit		17,355		4		(75	)		17,284		—		17,284
U.S. Treasury securities		21,847		3		(15	)		21,835		21,835		—
U.S. agency securities		10,688		16		(3	)		10,701		—		10,701
Corporate debt securities		45,522		4		(288	)		45,238		—		45,238
Total investments AFS	$	139,466	$	38	$	(443	)	$	139,061	$	21,835	$	117,226

Summary of Fair Value of Investments Available for Sale by Contractual Maturity

The following table shows the fair value of investments AFS by contractual maturity (dollars in thousands):

	As of June 30, 2023
	Within one year		After one year through five years		Total
Commercial paper	$	28,500	$	—	$	28,500
Certificates of deposit		10,762		—		10,762
U.S. Treasury securities		16,613		13,502		30,115
U.S. agency securities		10,030		972		11,002
Corporate debt securities		31,407		3,051		34,458
Total investments AFS	$	97,312	$	17,525	$	114,837

XML

Inventories (Tables)

6 Months Ended

Jun. 30, 2023

Inventory Disclosure [Abstract]

Schedule of Inventory, Current

Inventories, net are stated at the lower of cost and net realizable value, determined on a first-in, first-out basis and consisted of the following (in thousands):

	June 30, 2023			December 30, 2022
Raw materials and purchased parts	$	7,341		$	6,703
Work in process		5,865			5,499
Finished goods		16,502			13,633
Total inventories, gross		29,708			25,835
Less inventory reserves		(4,226	)		(1,674	)
Total inventories, net	$	25,482		$	24,161

XML

Prepayments, Deposits, and Other Current Assets (Tables)

6 Months Ended

Jun. 30, 2023

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Schedule Of Prepayments, Deposits, and Other Current Assets

Prepayments, deposits, and other current assets consisted of the following (in thousands):

	June 30, 2023		December 30, 2022
Prepayments and deposits	$	4,968	$	3,986
Prepaid insurance		1,190		2,620
Prepaid marketing costs		3,353		2,534
Consumption tax receivable		802		864
Value added tax (VAT) receivable		3,880		2,661
BVG (Swiss Pension) prepayment		1,211		111
Other(1)		668		700
Total prepayments, deposits and other current assets	$	16,072	$	13,476

(1)No individual category in “other current assets” exceeds 5% of the total prepayments, deposits and other current assets.

XML

Property, Plant and Equipment (Tables)

6 Months Ended

Jun. 30, 2023

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment, Net

Property, plant and equipment, net consisted of the following (in thousands):

	June 30, 2023			December 30, 2022
Machinery and equipment	$	29,836		$	28,026
Computer equipment and software		9,591			9,266
Furniture and fixtures		4,491			4,276
Leasehold improvements		16,840			14,965
Construction in process		35,109			32,269
Total property, plant and equipment, gross		95,867			88,802
Less accumulated depreciation		(39,943	)		(37,881	)
Total property, plant and equipment, net	$	55,924		$	50,921

XML

Intangible Assets (Tables)

6 Months Ended

Jun. 30, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Finite-Lived Intangible Assets

Intangible assets, net consisted of the following (in thousands):

	June 30, 2023							December 30, 2022
Long-lived amortized intangible assets	Gross Carrying Amount		Accumulated Amortization			Net		Gross Carrying Amount		Accumulated Amortization			Net
Patents and licenses	$	9,195	$	(9,195	)	$	—	$	9,240	$	(9,067	)	$	173

XML

Other Current Liabilities (Tables)

6 Months Ended

Jun. 30, 2023

Other Liabilities Disclosure [Abstract]

Schedule of Other Current Liabilities

Other current liabilities consisted of the following (in thousands):

	June 30, 2023		December 30, 2022
Accrued salaries and wages	$	11,511	$	10,862
Accrued bonuses		1,707		6,925
Income taxes payable		7,202		3,845
Marketing obligations		1,354		1,374
Other(1)		10,151		7,735
Total other current liabilities	$	31,925	$	30,741

(1)No individual category in “Other” exceeds 5% of the other current liabilities.

XML

Leases (Tables)

6 Months Ended

Jun. 30, 2023

Leases [Abstract]

Supplemental Balance Sheet Information Related to Finance Leases

Supplemental balance sheet information related to finance leases consisted of the following (dollars in thousands):

Note 8 – Leases (Continued)

Finance Leases (Continued)

	June 30, 2023			December 30, 2022
Machinery and equipment	$	—		$	30
Computer equipment and software		6			18
Furniture and fixtures		475			475
Finance lease right-of-use assets, gross		481			523
Less accumulated depreciation		(224	)		(181	)
Finance lease right-of-use assets, net	$	257		$	342
Current finance lease obligations	$	162		$	169
Long-term finance lease obligations		125			210
Total finance lease liability	$	287		$	379
Weighted-average remaining lease term (in years)		1.8			2.2
Weighted-average discount rate		4.23	%		4.10	%

Supplemental Cash Flow Information Related to Finance Leases

Supplemental cash flow information related to finance leases consisted of the following (dollars in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Amortization of finance lease right-of-use asset	$	38	$	39	$	77	$	82
Interest on finance lease liabilities		3		5		7		8
Cash paid for amounts included in the measurement of finance lease liabilities:
Operating cash flows		3		5		7		8
Financing cash flows		40		27		82		45

Supplemental Balance Sheet Information Related to Operating Leases

Supplemental balance sheet information related to operating leases consisted of the following (dollars in thousands):

	June 30, 2023			December 30, 2022
Machinery and equipment	$	752		$	789
Computer equipment and software		446			446
Real property		36,756			34,465
Operating lease right-of-use assets, gross		37,954			35,700
Less accumulated depreciation		(6,424	)		(5,430	)
Operating lease right-of-use assets, net	$	31,530		$	30,270
Current operating lease obligations	$	4,013		$	3,524
Long-term operating lease obligations		28,189			27,136
Total operating lease liability	$	32,202		$	30,660
Weighted-average remaining lease term (in years)		7.2			7.5
Weighted-average discount rate		4.44	%		3.87	%

Supplemental Cash Flow Information Related to Operating Leases

Supplemental cash flow information related to operating leases was as follows (dollars in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Operating lease cost	$	1,357	$	1,166	$	2,464	$	2,304
Cash paid for amounts included in the measurement of operating lease liabilities:
Operating cash flows		1,152		1,034		2,325		1,966
Right-of-use assets obtained in exchange for new operating lease liabilities		1,511		2,081		3,420		2,756

Schedule of Estimated Future Maturities of Lease Liabilities under Operating and Finance Leases Having Initial or Remaining Non-Cancelable Lease Terms More Than One Year

Estimated future maturities of lease liabilities under operating and finance leases having initial or remaining non-cancelable lease terms more than one year as of June 30, 2023 is as follows (in thousands):

.

As of June 30, 2023 12 Months Ended	Operating Leases			Finance Leases
June 2024	$	5,990		$	171
June 2025		5,834			127
June 2026		4,463			—
June 2027		4,432			—
June 2028		4,476			—
Thereafter		13,433			—
Total future minimum lease payments	$	38,628		$	298
Less amounts representing interest		(6,426	)		(11	)
Total lease liability	$	32,202		$	287

XML

Income Taxes (Tables)

6 Months Ended

Jun. 30, 2023

Income Tax Disclosure [Abstract]

Schedule of Income Tax Provision

The Company recorded an income tax provision as follows (in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Provision for income taxes	$	2,428	$	2,431	$	4,437	$	4,356

XML

Defined Benefit Pension Plans (Tables)

6 Months Ended

Jun. 30, 2023

Retirement Benefits [Abstract]

Schedule of Net Benefit Costs

The Company has defined benefit plans covering employees of its Switzerland and Japan operations. The following table summarizes the components of net periodic pension cost recorded for the Company’s defined benefit pension plans (in thousands):

	Three Months Ended						Six Months Ended
	June 30, 2023			July 1, 2022			June 30, 2023			July 1, 2022
Service cost(1)	$	254		$	309		$	503		$	635
Interest cost(2)		90			21			177			41
Expected return on plan assets(2)		(91	)		(123	)		(178	)		(241	)
Prior service credit(2),(3)		(45	)		(46	)		(90	)		(91	)
Actuarial loss recognized in current period(2),(3)		(6	)		79			(13	)		176
Net periodic pension cost	$	202		$	240		$	399		$	520

(1)Recognized in selling general and administrative expenses on the Condensed Consolidated Statements of Income.

(2)Recognized in other expense, net on the Condensed Consolidated Statements of Income.

(3)Amounts reclassified from accumulated other comprehensive income (loss).

Schedule of Defined Benefit Plans Disclosures

The Company currently is not required to and does not make contributions to its Japan pension plan. The Company’s contributions to its Swiss pension plan are as follows (in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Employer contribution	$	245	$	220	$	462	$	436

XML

Stockholders' Equity (Tables)

6 Months Ended

Jun. 30, 2023

Stockholders' Equity Note [Abstract]

Schedule of Compensation Cost

The cost that has been charged against income for stock-based compensation is set forth below (in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Employee stock options	$	3,479	$	2,457	$	6,456	$	4,784
Restricted stock		79		442		146		551
Restricted stock units		2,148		1,231		3,749		1,993
Performance stock units		2,403		1,310		3,509		1,692
Nonemployee stock options		314		314		628		628
Total stock-based compensation expense	$	8,423	$	5,754	$	14,488	$	9,648

Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs

The Company recorded stock-based compensation costs in the following categories (in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Cost of sales	$	223	$	106	$	372	$	176
General and administrative		3,695		2,806		7,058		4,587
Selling and marketing		2,492		1,324		3,349		2,213
Research and development		2,013		1,518		3,709		2,672
Total stock-based compensation expense, net		8,423		5,754		14,488		9,648
Amounts capitalized as part of inventory		528		652		897		1,018
Total stock-based compensation expense, gross	$	8,951	$	6,406	$	15,385	$	10,666

Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions

The risk-free rate is based on the U.S. Treasury yield curve corresponding to the expected term at the time of the grant.

	Three Months Ended						Six Months Ended
	June 30, 2023			July 1, 2022			June 30, 2023			July 1, 2022
Expected dividend yield		0	%		0	%		0	%		0	%
Expected volatility		58	%		54	%		59	%		54	%
Risk-free interest rate		3.41	%		3.27	%		3.87	%		1.83	%
Expected term (in years)		4.87			5.10			5.02			5.10

Schedule of Share-based Compensation, Stock Options, Activity

A summary of stock option activity under the Plan for six months ended June 30, 2023 is presented below:

	Stock Options (in 000’s)			Minimum Exercise Price		Maximum Exercise Price
Outstanding at December 30, 2022		2,469
Granted		584
Exercised		(195	)
Forfeited or expired		(31	)
Outstanding at June 30, 2023		2,827		$	5.54	$	154.96
Exercisable at June 30, 2023		1,903

Schedule of Share-based Compensation, Restricted Stock, RSUs and PSUs Activity

A summary of restricted stock, RSUs and PSUs activity under the Plan for the six months ended June 30, 2023 is presented below (shares in thousands):

	Restricted Stock			RSUs			PSUs
Unvested at December 30, 2022		4			192			118
Granted		10			259			178
Vested		(4	)		(80	)		(36	)
Forfeited or expired		—			(6	)		(11	)
Unvested at June 30, 2023		10			365			249

XML

Basic and Diluted Net Income Per Share (Tables)

6 Months Ended

Jun. 30, 2023

Earnings Per Share [Abstract]

Summary of Computation of Basic and Diluted Net Income Per Share

The following table sets forth the computation of basic and diluted net income per share (in thousands except per share amounts):

	Three Months Ended						Six Months Ended
	June 30, 2023			July 1, 2022			June 30, 2023			July 1, 2022
Numerator:
Net income	$	6,064		$	13,038		$	8,774		$	22,640
Denominator:
Weighted average common shares:
Common shares outstanding		48,428			47,893			48,343			47,826
Less: Unvested restricted stock		(10	)		(4	)		(10	)		(4	)
Denominator for basic calculation		48,418			47,889			48,333			47,822
Weighted average effects of potentially diluted common stock:
Stock options		986			1,299			1,050			1,386
Unvested restricted stock		3			3			3			2
RSUs		46			24			77			45
PSUs		63			8			61			9
Denominator for diluted calculation		49,516			49,223			49,524			49,264
Net income per share:
Basic	$	0.13		$	0.27		$	0.18		$	0.47
Diluted	$	0.12		$	0.26		$	0.18		$	0.46

Schedule of Anti-dilutive Securities Excluded from Computation of Earnings Per Share

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Stock options		1,874		1,153		1,625		862
Restricted stock, RSUs and PSUs		127		267		24		122
Total		2,001		1,420		1,649		984

XML

Disaggregation of Sales, Geographic Sales and Product Sales (Tables)

6 Months Ended

Jun. 30, 2023

Segment Reporting [Abstract]

Disaggregation of Sales

In the following tables, sales are disaggregated by category, sales by geographic market and sales by product data. The following breaks down sales into the following categories (in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Non-consignment sales	$	88,068	$	76,444	$	155,231	$	134,013
Consignment sales		4,238		4,657		10,603		10,288
Total net sales		92,306		81,101	$	165,834	$	144,301

Net Sales by Geographic Areas

The composition of the Company’s net sales to unaffiliated customers was as follows (in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2023		July 1, 2022		June 30, 2023		July 1, 2022
Domestic	$	4,346	$	3,872	$	8,897	$	6,502
Foreign:
China		61,339		46,150		96,429		74,389
Japan		8,415		10,302		19,351		21,935
Other(1)		18,206		20,777		41,157		41,475
Total foreign sales		87,960		77,229		156,937		137,799
Total net sales	$	92,306	$	81,101	$	165,834	$	144,301

(1)No other location individually exceeds 10% of the total sales.

Net Sales by Products and Services

The composition of the Company’s net sales by product line was as follows (in thousands):

	Three Months Ended					Six Months Ended
	June 30, 2023			July 1, 2022		June 30, 2023		July 1, 2022
ICLs	$	93,112		$	77,922	$	163,737	$	136,597
Other product sales:
Cataract IOLs		40			2,547		1,516		5,449
Other surgical products(1)		(846	)		632		581		2,255
Total other product sales		(806	)		3,179		2,097		7,704
Total net sales	$	92,306		$	81,101	$	165,834	$	144,301

(1) Other surgical products include delivery systems and normal recurring sales adjustments such as sales return allowances.

XML

Basis of Presentation and Significant Accounting Policies - Additional Information (Details) - Vendor Concentration Risk - Maximum	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 30, 2022
Consolidated Accounts Payable
Organization And Description Of Business And Accounting Policies [Line Items]
Concentration risk, percentage	10.00%
Consolidated Purchases
Organization And Description Of Business And Accounting Policies [Line Items]
Concentration risk, percentage		10.00%

XML

Investments Available for Sale - Summary of Investments Available for Sale and Related Fair Value Measurement (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 30, 2022
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	$ 115,270	$ 139,466
Unrealized Gains	4	38
Unrealized Losses	(437)	(443)
Estimated Fair Value	114,837	139,061
Fair Value, Inputs, Level 1
Schedule Of Available For Sale Securities [Line Items]
Fair Value Measurements	30,115	21,835
Fair Value, Inputs, Level 2
Schedule Of Available For Sale Securities [Line Items]
Fair Value Measurements	84,722	117,226
Commercial Paper
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	28,519	44,054
Unrealized Gains		11
Unrealized Losses	(19)	(62)
Estimated Fair Value	28,500	44,003
Commercial Paper | Fair Value, Inputs, Level 2
Schedule Of Available For Sale Securities [Line Items]
Fair Value Measurements	28,500	44,003
Certificates of Deposit
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	10,774	17,355
Unrealized Gains	1	4
Unrealized Losses	(13)	(75)
Estimated Fair Value	10,762	17,284
Certificates of Deposit | Fair Value, Inputs, Level 2
Schedule Of Available For Sale Securities [Line Items]
Fair Value Measurements	10,762	17,284
U.S. Treasury Securities
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	30,318	21,847
Unrealized Gains		3
Unrealized Losses	(203)	(15)
Estimated Fair Value	30,115	21,835
U.S. Treasury Securities | Fair Value, Inputs, Level 1
Schedule Of Available For Sale Securities [Line Items]
Fair Value Measurements	30,115	21,835
U.S. Agency Securities
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	11,034	10,688
Unrealized Gains		16
Unrealized Losses	(32)	(3)
Estimated Fair Value	11,002	10,701
U.S. Agency Securities | Fair Value, Inputs, Level 2
Schedule Of Available For Sale Securities [Line Items]
Fair Value Measurements	11,002	10,701
Corporate Debt Securities
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	34,625	45,522
Unrealized Gains	3	4
Unrealized Losses	(170)	(288)
Estimated Fair Value	34,458	45,238
Corporate Debt Securities | Fair Value, Inputs, Level 2
Schedule Of Available For Sale Securities [Line Items]
Fair Value Measurements	$ 34,458	$ 45,238

XML

Investments Available for Sale - Additional Information (Details) - USD ($)	3 Months Ended	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2023
Investments, Debt and Equity Securities [Abstract]
Impairment recognized	$ 0	$ 0
Sale of securities		600,000
Realized gain on debt securities available for sale		$ 2,000

XML

Investments Available for Sale - Summary of Fair Value of Investments Available for Sale by Contractual Maturity (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 30, 2022
Schedule Of Available For Sale Securities [Line Items]
Within one year	$ 97,312
After one year through five years	17,525
Total	114,837	$ 139,061
Commercial Paper
Schedule Of Available For Sale Securities [Line Items]
Within one year	28,500
Total	28,500	44,003
Certificates of Deposit
Schedule Of Available For Sale Securities [Line Items]
Within one year	10,762
Total	10,762	17,284
U.S. Treasury Securities
Schedule Of Available For Sale Securities [Line Items]
Within one year	16,613
After one year through five years	13,502
Total	30,115	21,835
U.S. Agency Securities
Schedule Of Available For Sale Securities [Line Items]
Within one year	10,030
After one year through five years	972
Total	11,002	10,701
Corporate Debt Securities
Schedule Of Available For Sale Securities [Line Items]
Within one year	31,407
After one year through five years	3,051
Total	$ 34,458	$ 45,238

XML

Inventories - Schedule of Inventory, Current (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 30, 2022
Inventory Disclosure [Abstract]
Raw materials and purchased parts	$ 7,341	$ 6,703
Work in process	5,865	5,499
Finished goods	16,502	13,633
Total inventories, gross	29,708	25,835
Less inventory reserves	(4,226)	(1,674)
Total inventories, net	$ 25,482	$ 24,161

XML

Prepayments, Deposits, and Other Current Assets - Schedule Of Prepayments, Deposits, and Other Current Assets (Details) - USD ($) $ in Thousands		Jun. 30, 2023	Dec. 30, 2022
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Prepayments and deposits		$ 4,968	$ 3,986
Prepaid insurance		1,190	2,620
Prepaid marketing costs		3,353	2,534
Consumption tax receivable		802	864
Value added tax (VAT) receivable		3,880	2,661
BVG (Swiss Pension) prepayment		1,211	111
Other	[1]	668	700
Total prepayments, deposits and other current assets		$ 16,072	$ 13,476

[1] No individual category in “other current assets” exceeds 5% of the total prepayments, deposits and other current assets.

XML

Prepayments, Deposits, and Other Current Assets - Schedule Of Prepayments, Deposits, and Other Current Assets (Parenthetical) (Details)	Jun. 30, 2023	Dec. 30, 2022
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Percent of prepayments deposits and other current assets included in other current assets	5.00%	5.00%

XML

Property, Plant and Equipment - Property, Plant and Equipment, Net (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 30, 2022
Property, Plant and Equipment [Abstract]
Machinery and equipment	$ 29,836	$ 28,026
Computer equipment and software	9,591	9,266
Furniture and fixtures	4,491	4,276
Leasehold improvements	16,840	14,965
Construction in process	35,109	32,269
Total property, plant and equipment, gross	95,867	88,802
Less accumulated depreciation	(39,943)	(37,881)
Total property, plant and equipment, net	$ 55,924	$ 50,921

XML

Intangible Assets - Schedule of Finite-Lived Intangible Assets (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 30, 2022
Finite Lived Intangible Assets [Line Items]
Long-lived intangible assets, Net		$ 173
Patents and licenses
Finite Lived Intangible Assets [Line Items]
Long-lived intangible assets, Gross Carrying Amount	$ 9,195	9,240
Long-lived intangible assets, Accumulated Amortization	(9,195)	(9,067)
Long-lived intangible assets, Net	$ 0	$ 173

XML

Intangible Assets - Additional Information (Details) - USD ($)	3 Months Ended	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2023
Patents and licenses | Cataract IOLs | Japan
Finite-Lived Intangible Assets [Line Items]
Impairment of intangible assets	$ 154,000	$ 154,000

XML

Other Current Liabilities - Schedule of Other Current Liabilities (Details) - USD ($) $ in Thousands		Jun. 30, 2023	Dec. 30, 2022
Other Liabilities Disclosure [Abstract]
Accrued salaries and wages		$ 11,511	$ 10,862
Accrued bonuses		1,707	6,925
Income taxes payable		7,202	3,845
Marketing obligations		1,354	1,374
Other	[1]	10,151	7,735
Total other current liabilities		$ 31,925	$ 30,741

[1] No individual category in “Other” exceeds 5% of the other current liabilities.

XML

Other Current Liabilities - Schedule of Other Current Liabilities (Parenthetical) (Details)	Jun. 30, 2023	Dec. 30, 2022
Other Liabilities Disclosure [Abstract]
Percent of Other Current Liabilities Included in Other	5.00%	5.00%

XML

Leases - Additional Information (Details)	Jun. 30, 2023
Minimum
Lessee Lease Description [Line Items]
Finance lease, term of contract	2 years
Operating lease, term of contract	2 years
Maximum
Lessee Lease Description [Line Items]
Finance lease, term of contract	5 years
Operating lease, term of contract	10 years

XML

Leases - Supplemental Balance Sheet Information Related to Finance Leases (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 30, 2022
Lessee Lease Description [Line Items]
Finance lease right-of-use assets, gross	$ 481	$ 523
Less accumulated depreciation	(224)	(181)
Finance lease right-of-use assets, net	257	342
Current finance lease obligations	162	169
Long-term finance lease obligations	125	210
Total finance lease liability	$ 287	$ 379
Weighted-average remaining lease term (in years)	1 year 9 months 18 days	2 years 2 months 12 days
Weighted-average discount rate	4.23%	4.10%
Machinery and Equipment
Lessee Lease Description [Line Items]
Finance lease right-of-use assets, gross		$ 30
Computer Equipment and Software
Lessee Lease Description [Line Items]
Finance lease right-of-use assets, gross	$ 6	18
Furniture and Fixtures
Lessee Lease Description [Line Items]
Finance lease right-of-use assets, gross	$ 475	$ 475

XML

Leases - Supplemental Cash Flow Information Related to Finance Leases (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jul. 01, 2022	Jun. 30, 2023	Jul. 01, 2022
Leases [Abstract]
Amortization of finance lease right-of-use asset	$ 38	$ 39	$ 77	$ 82
Interest on finance lease liabilities	3	5	7	8
Cash paid for amounts included in the measurement of finance lease liabilities:
Operating cash flows	3	5	7	8
Financing cash flows	$ 40	$ 27	$ 82	$ 45

XML

Leases - Supplemental Balance Sheet Information Related to Operating Leases (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 30, 2022
Lessee Lease Description [Line Items]
Operating lease right-of-use assets, gross	$ 37,954	$ 35,700
Less accumulated depreciation	(6,424)	(5,430)
Operating lease right-of-use assets, net	31,530	30,270
Current operating lease obligations	4,013	3,524
Long-term operating lease obligations	28,189	27,136
Total operating lease liability	$ 32,202	$ 30,660
Weighted-average remaining lease term (in years)	7 years 2 months 12 days	7 years 6 months
Weighted-average discount rate	4.44%	3.87%
Machinery and Equipment
Lessee Lease Description [Line Items]
Operating lease right-of-use assets, gross	$ 752	$ 789
Computer Equipment and Software
Lessee Lease Description [Line Items]
Operating lease right-of-use assets, gross	446	446
Real Property
Lessee Lease Description [Line Items]
Operating lease right-of-use assets, gross	$ 36,756	$ 34,465

XML

Leases - Supplemental Cash Flow Information Related to Operating Leases (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jul. 01, 2022	Jun. 30, 2023	Jul. 01, 2022
Leases [Abstract]
Operating lease cost	$ 1,357	$ 1,166	$ 2,464	$ 2,304
Cash paid for amounts included in the measurement of operating lease liabilities:
Operating cash flows	1,152	1,034	2,325	1,966
Right-of-use assets obtained in exchange for new operating lease liabilities	$ 1,511	$ 2,081	$ 3,420	$ 2,756

XML

Leases - Schedule of Estimated Future Maturities of Lease Liabilities under Operating and Finance Leases Having Initial or Remaining Non-Cancelable Lease Terms More Than One Year (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 30, 2022
Operating Lease Liabilities, Payments, Due, Rolling Maturity [Abstract]
June 2024	$ 5,990
June 2025	5,834
June 2026	4,432
June 2027	4,463
June 2028	4,476
Thereafter	13,433
Total future minimum lease payments	38,628
Less amounts representing interest	(6,426)
Total lease liability	32,202	$ 30,660
Finance Lease Liabilities, Payments, Rolling Maturity [Abstract]
June 2024	171
June 2025	127
Total future minimum lease payments	298
Less amounts representing interest	(11)
Total lease liability	$ 287	$ 379

XML

Income Taxes - Schedule of Income Tax Provision (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jul. 01, 2022	Jun. 30, 2023	Jul. 01, 2022
Income Tax Disclosure [Abstract]
Provision for income taxes	$ 2,428	$ 2,431	$ 4,437	$ 4,356

XML

Income Taxes - Additional Information (Details)	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jul. 01, 2022	Jun. 30, 2023	Jul. 01, 2022
Income Tax Disclosure [Abstract]
Effective tax rate	28.60%	15.70%	33.60%	16.10%
Effective tax rates differ from U.S. federal statutory rate	21.00%	21.00%	21.00%	21.00%

XML

Defined Benefit Pension Plans - Schedule of Net Benefit Costs (Details) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2023	Jul. 01, 2022	Jun. 30, 2023	Jul. 01, 2022
Retirement Benefits [Abstract]
Service cost	[1]	$ 254	$ 309	$ 503	$ 635
Interest cost	[2]	90	21	177	41
Expected return on plan assets	[2]	(91)	(123)	(178)	(241)
Prior service credit	[2],[3]	(45)	(46)	(90)	(91)
Actuarial loss recognized in current period	[2],[3]	(6)	79	(13)	176
Net periodic pension cost		$ 202	$ 240	$ 399	$ 520

[1] Recognized in selling general and administrative expenses on the Condensed Consolidated Statements of Income.

[2] Recognized in other expense, net on the Condensed Consolidated Statements of Income.

[3] Amounts reclassified from accumulated other comprehensive income (loss).

XML

Defined Benefit Pension Plans - Schedule of Defined Benefit Plans Disclosures (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jul. 01, 2022	Jun. 30, 2023	Jul. 01, 2022
Swiss pension plan
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Employer contribution	$ 245	$ 220	$ 462	$ 436

XML

Stockholders' Equity - Schedule of Compensation Cost (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jul. 01, 2022	Jun. 30, 2023	Jul. 01, 2022
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	$ 8,423	$ 5,754	$ 14,488	$ 9,648
Employee Stock Option
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	3,479	2,457	6,456	4,784
Restricted Stock
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	79	442	146	551
Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	2,148	1,231	3,749	1,993
Performance Stock Units
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	2,403	1,310	3,509	1,692
Non Employee Stock Options
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	$ 314	$ 314	$ 628	$ 628

XML

Stockholders' Equity - Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jul. 01, 2022	Jun. 30, 2023	Jul. 01, 2022
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense, net	$ 8,423	$ 5,754	$ 14,488	$ 9,648
Amounts capitalized as part of inventory	528	652	897	1,018
Total stock-based compensation expense, gross	8,951	6,406	15,385	10,666
Cost of Sales
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense, net	223	106	372	176
General and Administrative
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense, net	3,695	2,806	7,058	4,587
Selling and Marketing
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense, net	2,492	1,324	3,349	2,213
Research and Development Expense
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense, net	$ 2,013	$ 1,518	$ 3,709	$ 2,672

XML

Stockholders' Equity - Additional Information (Details) - shares		6 Months Ended
	Jun. 15, 2023	Jun. 30, 2023
Stockholders Equity Note [Line Items]
Estimated forfeiture rate		7.00%
Omnibus Plan
Stockholders Equity Note [Line Items]
Share-based compensation arrangement by share-based payment award, expiration period		10 years
Share-based compensation arrangement by share-based payment award, number of additional shares authorized	2,170,000
Share-based compensation arrangement by share-based payment award, number of shares authorized	20,205,000
Omnibus Plan | Employee Stock Option
Stockholders Equity Note [Line Items]
Share-based compensation arrangement by share-based payment award, vesting period		3 years
Omnibus Plan | Restricted Stock
Stockholders Equity Note [Line Items]
Share-based compensation arrangement by share-based payment award, number of shares available for grant		2,844,500
Omnibus Plan | Restricted Stock | Minimum
Stockholders Equity Note [Line Items]
Share-based compensation arrangement by share-based payment award, vesting period		1 year
Omnibus Plan | Restricted Stock | Maximum
Stockholders Equity Note [Line Items]
Share-based compensation arrangement by share-based payment award, vesting period		3 years

XML

Stockholders' Equity - Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions (Details)	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jul. 01, 2022	Jun. 30, 2023	Jul. 01, 2022
Stockholders' Equity Note [Abstract]
Expected dividend yield	0.00%	0.00%	0.00%	0.00%
Expected volatility	58.00%	54.00%	59.00%	54.00%
Risk-free interest rate	3.41%	3.27%	3.87%	1.83%
Expected term (in years)	4 years 10 months 13 days	5 years 1 month 6 days	5 years 7 days	5 years 1 month 6 days

XML

Stockholders' Equity - Schedule of Share-based Compensation, Stock Options, Activity (Details) - $ / shares shares in Thousands	6 Months Ended
	Jun. 30, 2023
Stockholders' Equity Note [Abstract]
Options, Outstanding at December 30, 2022	2,469
Options, Granted, Shares	584
Options, Exercised, Shares	(195)
Options, Forfeited or expired, Shares	(31)
Options, Outstanding at June 30, 2023	2,827
Options, Exercisable at June 30, 2023	1,903
Minimum Exercise Price	$ 5.54
Maximum Exercise Price	$ 154.96

XML

Stockholders' Equity - Schedule of Share-based Compensation, Restricted Stock, RSUs and PSUs Activity (Details) shares in Thousands	6 Months Ended
	Jun. 30, 2023 shares
Restricted Stock
Schedule of Restricted Stock Restricted Stock Units and Performance Stock Units [Line Items]
Unvested at December 30, 2022	4
Granted	10
Vested	(4)
Unvested at June 30, 2023	10
RSUs
Schedule of Restricted Stock Restricted Stock Units and Performance Stock Units [Line Items]
Unvested at December 30, 2022	192
Granted	259
Vested	(80)
Forfeited or expired	(6)
Unvested at June 30, 2023	365
PSUs
Schedule of Restricted Stock Restricted Stock Units and Performance Stock Units [Line Items]
Unvested at December 30, 2022	118
Granted	178
Vested	(36)
Forfeited or expired	(11)
Unvested at June 30, 2023	249

XML

Commitments and Contingencies - Additional Information (Details) - USD ($)	3 Months Ended	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Jun. 30, 2023	Dec. 29, 2023	Dec. 30, 2022
Other Current Liabilities
Loss Contingencies [Line Items]
Severance payable	$ 508,000	$ 508,000		$ 410,000
Severance payable includes one-time employee benefits	341,000	341,000		$ 300,000
General and Administrative
Loss Contingencies [Line Items]
One-time employee termination benefits	$ 159,000	$ 1,351,000
General and Administrative | Scenario Forecast
Loss Contingencies [Line Items]
One-time employee termination benefits			$ 1,440,000

XML

Basic and Diluted Net Income Per Share - Summary of Computation of Basic and Diluted Net Income Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jul. 01, 2022	Jun. 30, 2023	Jul. 01, 2022
Numerator:
Net Income (Loss)	$ 6,064	$ 13,038	$ 8,774	$ 22,640
Weighted average common shares:
Common shares outstanding	48,428	47,893	48,343	47,826
Less: Unvested restricted stock	(10)	(4)	(10)	(4)
Denominator for basic calculation	48,418	47,889	48,333	47,822
Weighted average effects of potentially diluted common stock:
Diluted	49,516	49,223	49,524	49,264
Net income per share:
Basic	$ 0.13	$ 0.27	$ 0.18	$ 0.47
Diluted	$ 0.12	$ 0.26	$ 0.18	$ 0.46
Employee Stock Option
Weighted average effects of potentially diluted common stock:
Diluted	986	1,299	1,050	1,386
Unvested Restricted Stock
Weighted average effects of potentially diluted common stock:
Diluted	3	3	3	2
RSUs
Weighted average effects of potentially diluted common stock:
Diluted	46	24	77	45
PSUs
Weighted average effects of potentially diluted common stock:
Diluted	63	8	61	9

XML

Basic and Diluted Net Income Per Share - Schedule of Anti-dilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares shares in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jul. 01, 2022	Jun. 30, 2023	Jul. 01, 2022
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Anti-dilutive securities excluded from computation of earnings per share, Amount	2,001	1,420	1,649	984
Employee Stock Option
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Anti-dilutive securities excluded from computation of earnings per share, Amount	1,874	1,153	1,625	862
Restricted stock, RSUs and PSUs
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Anti-dilutive securities excluded from computation of earnings per share, Amount	127	267	24	122

XML

Disaggregation of Sales, Geographic Sales and Product Sales - Disaggregation of Sales (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jul. 01, 2022	Jun. 30, 2023	Jul. 01, 2022
Total net sales	$ 92,306	$ 81,101	$ 165,834	$ 144,301
Non Consignment Sales [Member]
Total net sales	88,068	76,444	155,231	134,013
Consignment Sales [Member]
Total net sales	$ 4,238	$ 4,657	$ 10,603	$ 10,288

XML

Disaggregation of Sales, Geographic Sales and Product Sales - Additional Information (Details)	3 Months Ended		6 Months Ended			12 Months Ended
	Jun. 30, 2023 Country	Jul. 01, 2022	Jun. 30, 2023 Country	Jun. 30, 2023 Segment Country	Jul. 01, 2022	Dec. 30, 2022
Geographic and Product Data [Line Items]
Number of countries in which Company operates | Country	75		75	75
Number of operating segments | Segment				1
Sales Revenue, Net | Geographic Concentration Risk [Member] | Other than China and Japan [Member] | Maximum
Geographic and Product Data [Line Items]
Concentration risk, percentage			10.00%	10.00%
Sales Revenue, Net | Geographic Concentration Risk [Member] | China [Member] | Customer One [Member]
Geographic and Product Data [Line Items]
Concentration risk, percentage	66.00%	57.00%		58.00%	52.00%
Sales Revenue, Net | Product Concentration Risk [Member] | Ophthalmic Surgical Product [Member]
Geographic and Product Data [Line Items]
Concentration risk, percentage				100.00%
Accounts Receivable [Member] | Geographic Concentration Risk [Member] | China [Member] | Customer One [Member]
Geographic and Product Data [Line Items]
Concentration risk, percentage				74.00%		59.00%

XML

Disaggregation of Sales, Geographic Sales and Product Sales - Net Sales by Geographic Areas (Details) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2023	Jul. 01, 2022	Jun. 30, 2023	Jul. 01, 2022
Geographic And Sales [Line Items]
Total net sales		$ 92,306	$ 81,101	$ 165,834	$ 144,301
Geographic Distribution, Domestic [Member]
Geographic And Sales [Line Items]
Total net sales		4,346	3,872	8,897	6,502
Geographic Distribution, Foreign [Member]
Geographic And Sales [Line Items]
Total net sales		87,960	77,229	156,937	137,799
Geographic Distribution, Foreign [Member] | China [Member]
Geographic And Sales [Line Items]
Total net sales		61,339	46,150	96,429	74,389
Geographic Distribution, Foreign [Member] | JAPAN
Geographic And Sales [Line Items]
Total net sales		8,415	10,302	19,351	21,935
Geographic Distribution, Foreign [Member] | Other [Member]
Geographic And Sales [Line Items]
Total net sales	[1]	$ 18,206	$ 20,777	$ 41,157	$ 41,475

[1] No other location individually exceeds 10% of the total sales.

XML

Disaggregation of Sales, Geographic Sales and Product Sales - Net Sales by Products and Services (Details) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2023	Jul. 01, 2022	Jun. 30, 2023	Jul. 01, 2022
Product Information [Line Items]
Total other product sales		$ (806)	$ 3,179	$ 2,097	$ 7,704
Total net sales		92,306	81,101	165,834	144,301
ICLs [Member]
Product Information [Line Items]
Revenue from contract with customer, excluding assessed tax		93,112	77,922	163,737	136,597
Cataract IOLs [Member]
Product Information [Line Items]
Total other product sales		40	2,547	1,516	5,449
Other surgical products [Member]
Product Information [Line Items]
Total other product sales	[1]	$ (846)	$ 632	$ 581	$ 2,255

[1] Other surgical products include delivery systems and normal recurring sales adjustments such as sales return allowances.