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01/10 17:04
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call indicates strong financial performance with revenue growth driven by Med Tech and Med Device segments. Positive developments include improved EBITDA and free cash flow, alongside optimistic guidance for Med Tech growth. Although tariffs impacted gross margin, the company is managing these effects. The Q&A reveals confidence in product approvals and growth, particularly for AlphaVac and AngioVac. Despite some ambiguity in management's responses, the overall sentiment is positive with expectations of continued growth, leading to a likely stock price increase of 2% to 8% over the next two weeks.
Total Revenue $80.2 million, representing growth of over 12% year-over-year, driven by Med Tech growth of over 20% and Med Device growth of more than 6%. The growth was attributed to the company's strategic transformation and focus on high-growth, high-margin Med Tech markets.
Med Tech Revenue $35.8 million, a 22% increase year-over-year. This growth was driven by the success of platforms like Auryon and mechanical thrombectomy products.
Med Device Revenue $44.4 million, an increase of 6.2% year-over-year. The growth was attributed to steady performance in the Med Device segment.
Auryon Platform Revenue $15.6 million, growing 19.7% year-over-year. The growth was driven by its demonstrated safety profile, versatility, and increased adoption in hospital settings and European markets.
Mechanical Thrombectomy Revenue $11.3 million (AngioVac: $8.2 million, AlphaVac: $3.1 million), a 44.7% year-over-year increase. The growth was driven by innovative differentiation, strong clinical data, and synergistic commercialization efforts.
NanoKnife Revenue $7.2 million, a decrease of 2.5% year-over-year. The decline was due to lower capital sales, although disposable sales grew 5.5%.
Gross Margin 52.7% for the quarter, negatively impacted by tariffs (204 basis points). Without tariffs, gross margin would have been 54.7%.
Adjusted EBITDA $3.4 million, compared to $1.5 million in the fourth quarter of 2024. The improvement was due to revenue growth and expense management initiatives.
Free Cash Flow $16.2 million, driven by strong operating cash generation and controlled capital expenditures.
Auryon: Continued to be the largest Med Tech product line with over $185 million in cumulative sales since its 2020 launch. Achieved 16 consecutive quarters of double-digit growth. Expanded into European PAD market with CE mark approval in September 2024, generating over $1 million in revenue from Europe in Q4 2025. Initiated AMBITION BTK trial to evaluate outcomes for critical limb ischemia patients.
Mechanical Thrombectomy Portfolio: Fastest-growing segment with 45% year-over-year growth. Includes AngioVac and AlphaVac. AlphaVac achieved 5 consecutive quarters of sequential revenue growth post-FDA clearance and CE marking in 2024. Initiated RECOVER-AV trial in Europe to strengthen clinical evidence.
NanoKnife: Achieved milestones including CPT Category I code for prostate and liver treatment effective January 2026, and expanded indication for prostate tissue ablation. Strong adoption in prostate cancer care with 81% of procedures in Q4 2025 being prostate-related.
European PAD Market Expansion: Auryon received CE mark approval in September 2024, enabling entry into the European market. Generated over $1 million in revenue from Europe in Q4 2025.
Structural Heart Market: AngioVac positioned to benefit from growth in structural heart sector, enabling engagement with interventional cardiologists and cardiothoracic surgeons.
Operational Efficiency: Generated positive adjusted EBITDA and over $15 million in free cash flow in Q4 2025. On track to achieve $15 million in annualized savings by fiscal 2027 through manufacturing transition.
Tariff Management: Incurred $1.6 million in tariff expenses in Q4 2025 but maintained profitability. Estimated $4-6 million tariff impact for fiscal 2026, with plans to remain cash flow positive.
Strategic Transformation: Shifted focus to high-growth, high-margin Med Tech markets. Med Tech segment now represents 43% of total revenue, doubling its share over five years.
Clinical Trials and R&D: Launched AMBITION BTK and RECOVER-AV trials to support product adoption. Investing in R&D to unlock new market opportunities, including coronary interventions for Auryon.
Tariff Impacts: The company incurred $1.6 million in tariff expenses in Q4 FY '25, with an estimated $4 million to $6 million impact expected in FY '26. This negatively affects gross margins, EBITDA, and EPS results.
Regulatory and Reimbursement Delays: The company is working with the FDA to establish a regulatory pathway for a version of AlphaVac with blood return functionality. Delays in regulatory approvals could hinder product adoption and competitive positioning.
Supply Chain and Manufacturing Transition: The company is undergoing a manufacturing transition process, aiming for $15 million in annualized savings by FY '27. Any disruptions in this transition could impact cost structure and operational efficiency.
Market Competition: The mechanical thrombectomy market is increasingly competitive. While the company has shown growth, maintaining market share against larger competitors remains a challenge.
Economic and Market Uncertainties: The unpredictable tariff environment and potential economic fluctuations could impact the company's financial performance and strategic execution.
Revenue Expectations: For fiscal year 2026, net sales are anticipated to be in the range of $305 million to $310 million, representing growth of 4% to 6% over fiscal 2025 revenue of $292.7 million. Med Tech net sales are expected to grow 12% to 15% year-over-year, while Med Device sales are expected to remain flat.
Gross Margin Projections: Gross margin for fiscal 2026 is expected to be in the range of 53.5% to 55.5%, inclusive of an estimated $4 million to $6 million tariff impact. Excluding tariffs, gross margin would have been 55% to 56%.
Adjusted EBITDA: Adjusted EBITDA for fiscal 2026 is projected to be in the range of $3 million to $8 million, inclusive of tariff impacts. Without tariffs, adjusted EBITDA guidance would have been $7.5 million to $10.5 million.
Cash Flow: The company expects to be cash flow positive for the full fiscal year 2026, despite an anticipated $20 million cash utilization in the first quarter.
Med Tech Growth Drivers: Continued growth is expected from the Auryon platform, mechanical thrombectomy portfolio (AngioVac and AlphaVac), and NanoKnife, supported by regulatory clearances, clinical data, and market expansion.
Operational Efficiency: The company expects to achieve approximately $15 million in annualized savings by fiscal 2027 through manufacturing transition processes.
Market Expansion: The company plans to add additional dedicated sales representatives to support demand for mechanical thrombectomy products in fiscal 2026. NanoKnife adoption is expected to accelerate with new CPT codes effective January 2026 for prostate and liver applications.
The selected topic was not discussed during the call.
The earnings call highlights strong financial performance with revenue growth across multiple segments, improved gross margins, and positive cash flow. The raised guidance for fiscal 2026 and increased adjusted EBITDA outlook further support a positive sentiment. Although some risks were noted, such as competitive pressures and international expansion challenges, the overall outlook and strategic initiatives like the Auryon platform's international traction and positive CPT code changes suggest a favorable stock price movement.
The earnings call revealed strong financial performance, especially in Med Tech, with a 26.1% revenue increase. The company raised guidance for Med Tech, driven by Mechanical Thrombectomy and NanoKnife, indicating confidence in future growth. Despite increased R&D and SG&A expenses, improved operating leverage and profitability were noted. Positive Q&A insights on sales force expansion and clinical trials further support optimism. However, management's reluctance to provide specific metrics for NanoKnife and trial timelines tempers enthusiasm slightly, leading to a positive but not strong positive sentiment.
The earnings call indicates strong financial performance with revenue growth driven by Med Tech and Med Device segments. Positive developments include improved EBITDA and free cash flow, alongside optimistic guidance for Med Tech growth. Although tariffs impacted gross margin, the company is managing these effects. The Q&A reveals confidence in product approvals and growth, particularly for AlphaVac and AngioVac. Despite some ambiguity in management's responses, the overall sentiment is positive with expectations of continued growth, leading to a likely stock price increase of 2% to 8% over the next two weeks.
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