STAAR's Two China Distributors Now Hold 61% Of Its Trade Receivables, Up From 33%
Receivables owed by China jumped to $86.5 million even as STAAR posted a profit and a $50.0 million buyback sat untouched.
STAAR Surgical, which makes implantable lenses for the eye, says its two China distributors accounted for 61% of trade receivables at October 2, up from 33% at January 2. The figure comes from the company's quarterly report, filed Wednesday alongside third-quarter results, and it sits beside a profitable quarter and a share buyback the company has not yet used.
Receivables climb, but off their peak
Accounts receivable, net of an allowance for credit losses, rose to $86.5 million from $50.1 million at the start of the year, the 10-Q shows. The China share of 61% compares with 65% in the prior quarter's filing, where receivables stood at $98.5 million.
The allowance for credit losses is $720 thousand, against $83 thousand at January 2.
Collections helped the quarter. Operating cash flow was $27.3 million in the third quarter, versus $2.7 million a year earlier, as receivables fell by $12.1 million. For the first nine months, receivables still absorbed $37.1 million of cash.
A China-heavy business
Nearly all of STAAR's sales come from its Implantable Collamer Lenses, and 91% of revenue in the fiscal year ended January 2 came from outside the United States. China distributors accounted for 47% of third-quarter net sales and 51% of the first nine months, down from 56% and 53% in the periods ended July 3.
Third-quarter net sales fell 12.0% to $83.4 million because the year-earlier quarter included $25.9 million from a 2024 China shipment whose revenue was recognized late. Excluding that, sales rose 21%. Net income was $5.6 million, or $0.11 a share, against $8.9 million.
Gross margin was 70.9% against 82.2%. The company said it does not expect to reach its 75% target in 2026 but expects improvement in the fourth quarter. It cited all new China lenses being made in Switzerland since the third quarter to cut tariff costs, though U.S.-made inventory sold to China remains subject to tariffs.
Cash and an unused buyback
Cash and investments reached $206.4 million, up from $181.5 million at July 3, and the company reports no debt. A $50.0 million repurchase authorization approved in September went unused in the third quarter.
In April 2025, the company moved its two China distributors to consignment arrangements to limit tariff exposure. China consignment sales were $5.5 million in the quarter.
Management says all new China lenses now come from Switzerland, and the company expects fourth-quarter gross margin to improve.
Sources
- 10-Q Filing — STAAR Surgical (STAA) — SEC EDGAR
- 10-Q Filing — STAAR Surgical (STAA), Q2 FY2026 filed 2026-08-12 (comparison basis) — SEC EDGAR
- Earnings release (8-K Item 2.02, staa-ex99_1.htm) — STAAR Surgical, filed 2026-11-04 — SEC EDGAR
- STAAR Surgical Company (STAA) Stock Price, News, Quote & History - Yahoo Finance — Yahoo Finance
- Is STAAR Surgical (STAA) Trading At A Discount After The Investigation? — Yahoo Finance
- STAAR Surgical Non-GAAP EPS of $0.28 beats by $0.11, revenue of $83.4M beats by $4.67M (STAA:NASDAQ) | Seeking Alpha — seekingalpha.com
- STAAR Surgical Reports Third Quarter 2026 Results — businesswire.com
