Key Highlights

  • Net sales for the quarter ended October 2, 2026 were USD 83.4 million against USD 94.7 million, a 12.0% decline that reflects USD 25.9 million of delayed China shipment Revenue booked a year earlier.
  • Excluding that prior-year shipment, net sales would have increased 21.1% against a base of USD 68.8 million, according to the filing, with EMEA up 31% and the Americas up 14%.
  • STAAR Surgical (NASDAQ:STAA) earned USD 5.6 million, or USD 0.11 per diluted share, versus USD 8.9 million, or USD 0.18, while gross Margin fell to 70.9% from 82.2%.
  • Cash and investments available for sale rose to USD 206.4 million from USD 181.5 million at July 3, 2026, and a USD 50.0 million repurchase authorization was announced in September.

A Distorted Comparison Explains the Decline

STAAR Surgical (NASDAQ:STAA) filed its fiscal third quarter report on November 4, 2026. The company makes Implantable Collamer Lenses, soft lenses placed in the eye without removing its natural lens, for vision correction. Third quarter 2025 included USD 25.9 million recognized for the December China Shipment, an order placed and shipped in 2024 whose revenue was delayed. Asia Pacific sales fell 20%, driven by China, and Japan sales fell 8% on currency but were essentially flat excluding it. Nine-month net sales rose 48.9% to USD 270.5 million, or 75.5% excluding the shipment. EMEA sales rose 31%, or 51% excluding the Middle East, where sales fell 2%, and Americas sales rose 14% on growth in the United States and Latin America. Currency reduced net sales by USD 1.0 million.

Gross Margin Falls Short of the 75% Target

Gross margin was 70.9% against 82.2%, which included a 6.7 point lift from the shipment in the prior year. Excluding it, the prior-year margin would have been 75.5%. Management blamed higher Manufacturing costs from low second quarter output during an enterprise software rollout, higher freight, tariffs on US goods made for China, and provisions for expiring inventory. It does not expect to reach its 75% target gross margin in 2026, though it expects improvement in the fourth quarter. Selling, general and administrative expense was USD 53.7 million versus USD 59.4 million, selling and Marketing was 29.2% of sales versus 24.8%, and Research and Development was 12.5% of sales.

Software Remediation, Switzerland Supply and Cash Build

All new lenses for China were made in Switzerland starting in the third quarter of 2026, which management expects to lower Tariff costs. The enterprise software implementation required extensive manual intervention, and the company expects to resolve the most significant issues by the end of 2026. Without the shipment, the prior-year quarter would have shown a net loss of USD 6.3 million, or USD 0.13 per share, so the comparison with a profit-making prior year is distorted. Risks include dependence on Asian demand, distributor reliance, tariffs and the Chinese economy. No shares were repurchased in the quarter, and the filing gave no price information or numeric outlook.

Where Things Stand

Sales fell 12% only because last year contained a one-off USD 25.9 million China shipment; the underlying trend was up 21.1%. STAAR Surgical (NASDAQ:STAA) still earned less than a year ago and margin slipped, which management attributes to temporary factors. Next markers are the fourth quarter margin improvement, resolution of software issues by year end, tariff relief from Swiss production and any use of the USD 50.0 million repurchase authorization.