Company: ALGN
Filing Date: 2025-02-28
Form Type: 10-K
Source: 0001097149-25-000012
Chunk: 105

Company: ALIGN TECHNOLOGY INC
Filing Date: 2025-02-28
Form: 10-K
Item: Item 7
Chunk 105
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 in 2024 as compared to 2023 primarily due to lower ASPs and higher restructuring expense.

45

Systems and Services

The gross margin percentage increased in 2024 as compared to 2023 primarily due to higher ASPs and lower cost of net revenues leverage, partially offset by lower service revenue mix.

Selling, general and administrative (in millions):

 Year Ended December 31,Year Ended December 31, 20242023Change20232022ChangeSelling, general and administrative$1,763.2 $1,703.4 $59.8 $1,703.4 $1,674.5 $28.9 % of net revenues44.1 %44.1 %44.1 %44.8 %

Changes and percentages are based on actual values. Certain tables may not sum or recalculate due to rounding.

Selling, general and administrative expense generally includes personnel-related costs, including payroll, stock-based compensation and commissions for our sales force, marketing and advertising expenses including media, market research, marketing materials, clinical education, trade shows and industry events, legal and outside service costs, equipment, software and maintenance costs, depreciation and amortization expense and allocations of corporate overhead expenses including facilities and Information Technology (“IT”).

Selling, general and administrative expense increased in 2024 compared to 2023 primarily due to higher employee costs, including salaries, fringe benefits, stock-based compensation and bonus partially offset by lower outside services expense. 

Research and development (in millions):

 Year Ended December 31,Year Ended December 31, 20242023Change20232022ChangeResearch and development$364.2 $346.8 $17.4 $346.8 $305.3 $41.6 % of net revenues9.1 %9.0 %9.0 %8.2 %

Changes and percentages are based on actual values. Certain tables may not sum or recalculate due to rounding.

Research and development expense generally includes personnel-related costs, including payroll and stock-based compensation, outside service costs associated with the research and development of new products and enhancements to existing products, software, equipment, material and maintenance costs, depreciation and amortization expense and allocations of corporate overhead expenses including facilities and IT.

Research and development expense increased in 2024 compared to 2023 primarily due to higher employee costs, including salaries, fringe benefits, stock-based compensation, net of capitalized labor