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01/10 17:29
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Despite a year-over-year revenue decline, the company demonstrated improved cost management, reducing losses significantly. The AYON product launch has been well-received, with strong presales and positive feedback, leading to raised guidance. The addition of experienced commercial hires and a promising partnership in China further bolster growth prospects. Although financial results were mixed, the optimistic guidance and strategic moves suggest a positive stock price movement over the next two weeks.
Total Revenue $11.4 million, a 6% decrease year-over-year from $12.1 million. The decline was primarily driven by a decrease in sales of OEM products, aligning with the company's strategic shift in focus and resource allocation.
Advanced Energy Product Sales $9.7 million, relatively flat compared to $9.8 million last year. The flattening was due to a decrease in the volume of single-use handpieces sold domestically, attributed to a decline in overall procedures and a strategic focus on presales of the AYON system.
OEM Segment Sales Decreased by 29% or approximately $1.7 million year-over-year. The decline was due to reduced sales volume to existing customers, including Symmetry Surgical under a 10-year generator manufacturing and supply agreement.
Domestic Revenue Decreased by 11% year-over-year to $7.8 million. The decline reflects the overall decrease in sales volume and strategic shifts.
International Revenue Decreased by 4% year-over-year to $3.6 million. The decline reflects the overall decrease in sales volume and strategic shifts.
Gross Profit $7.1 million, a decrease from $7.5 million in the prior year period. Gross profit margin slightly increased to 62.3% from 61.7%.
Operating Expenses Decreased to $9.7 million from $13 million in the prior year period. The reduction was driven by decreases in salaries and related costs ($1.6 million), selling, general and administrative expenses ($0.7 million), research and development expenses ($0.6 million), and professional services expenses ($0.5 million).
Loss from Operations Decreased by $3 million or 54% to $2.6 million year-over-year. This reflects the impact of cost-cutting measures implemented in late 2024.
Net Loss Attributable to Stockholders $3.8 million or $0.09 per share, compared to $6.6 million or $0.19 per share in the prior year period. The improvement reflects reduced operating expenses and cost management.
Adjusted EBITDA Loss Decreased by 54% to $2 million compared to $4.3 million in the prior year period. This reflects improved cost management and operational efficiency.
Cash Used in Operating Activities Decreased to $1.2 million from $4.3 million in the prior year period. This improvement reflects better cash and working capital management.
Cash and Cash Equivalents $29.3 million as of June 30, 2025, compared to $31.7 million as of December 31, 2024. The decrease reflects cash burn related to operations and the AYON launch.
AYON System: The AYON system, an all-in-one platform integrating Renuvion, ultrasound-assisted liposuction, infiltration, aspiration, electrocoagulation, and fat transfer, has been introduced. It has received FDA 510(k) clearance and is in a soft commercial launch phase. Early results from presales have exceeded expectations, and the broader commercial rollout is planned for September 2025.
Renuvion: Renuvion, a minimally invasive surgical solution for skin tightening, is gaining traction among surgeons and is being positioned as a new standard of care for patients with skin laxity, including those using GLP-1 medications. It has been launched in China with strong initial success.
China Market Expansion: Renuvion has been launched in China following market clearance from the National Medical Products Administration. A distribution agreement with GlamMoon Medical Technology has been established, and initial sales have been promising.
Cost Reduction and Restructuring: Cost reduction and restructuring initiatives implemented in November 2024 have resulted in a leaner operating structure, significant cash burn reduction, and improved financial health.
Leadership Appointments: Two senior sales leaders have been appointed: John Featherstone for North America and Simon Davies for Europe and Asia, both bringing extensive experience in the aesthetics industry.
Strategic Shift in Focus: The company is shifting focus and resources towards Advanced Energy products, particularly the AYON system and Renuvion, while reducing emphasis on OEM products.
Revenue Decline: Total revenue decreased by 6% year-over-year in Q2 2025, primarily due to a 29% drop in OEM sales and a slight decline in Advanced Energy product sales. This decline could impact the company's financial stability and growth trajectory.
Market Challenges: The global aesthetic market remains challenging, with subdued capital equipment spending across the industry. This could hinder the adoption of new products like AYON.
Supply Chain and Tariff Risks: Uncertainty around tariffs and trade policies could impact the cost structure and profitability of the company.
Operational Costs: While cost-cutting measures have been implemented, operating expenses remain significant, and any inefficiencies could strain financial resources.
Product Launch Risks: The success of the AYON system is critical to future growth, but its adoption depends on market reception and the ability to scale production and distribution effectively.
Economic Uncertainty: Economic factors, including seasonality and shifts in consumer spending, could affect revenue and operational performance.
Revenue Guidance for 2025: Total revenue is expected to range between $50 million and $52 million, up from the previous guidance of $47.6 million to $49 million. This represents an increase from $48.1 million in 2024.
Advanced Energy Revenue: Revenue is projected to range between $42 million and $44 million, up from the previous guidance of $39.6 million to $41 million. This is an increase from $38.6 million in 2024.
OEM Revenue: Revenue is expected to be approximately $8 million, compared to $9.5 million in 2024.
Gross Margins: Gross margins are anticipated to remain at approximately 60% for the year.
Operating Expenses: Total operating expenses are not expected to exceed $40 million for 2025.
AYON System Launch: The AYON system is expected to drive significant growth, with a broader commercial rollout planned for September 2025. Early interest and preorders have exceeded expectations, indicating strong market demand.
Market Trends and Growth Drivers: The adoption of GLP-1 drugs is creating a new patient population with skin laxity, presenting a significant growth opportunity for the Renuvion system. The company is well-positioned to capitalize on this trend.
International Expansion: Renuvion has been launched in China, with early success reported. The company anticipates this market to be a key growth driver.
Capital Equipment Spending: The AYON system is expected to reverse the subdued capital equipment spending trend in the aesthetics market, with strong enthusiasm from surgeons.
The selected topic was not discussed during the call.
The earnings call highlights a positive outlook with increased revenue guidance and improved financial metrics, such as higher gross margins and reduced net loss. The AYON system launch and international expansion are expected to drive growth. Despite some vague management responses in the Q&A, the overall sentiment is boosted by strong demand and strategic initiatives, leading to a positive stock price prediction.
Despite a year-over-year revenue decline, the company demonstrated improved cost management, reducing losses significantly. The AYON product launch has been well-received, with strong presales and positive feedback, leading to raised guidance. The addition of experienced commercial hires and a promising partnership in China further bolster growth prospects. Although financial results were mixed, the optimistic guidance and strategic moves suggest a positive stock price movement over the next two weeks.
The earnings call reflects a negative sentiment due to several factors: declining revenue guidance for 2024, ongoing net losses, and market challenges, including competitive pressures and regulatory uncertainties. Despite some positive aspects like cost reduction and a slight improvement in gross margins, the lack of clear guidance on key products like AYON and a new secondary offering further weigh down the outlook. The Q&A section did not provide sufficient clarity or optimism to offset these concerns, leading to a negative stock price prediction.
The earnings call reflects a challenging environment for Apyx Medical, with a decline in revenue and international sales, and a net loss despite cost-cutting efforts. The company's restructuring and direct offering indicate financial strain. Although there are plans for new product launches and a direct-to-consumer strategy, the uncertain regulatory approval for AYON and market challenges, such as the impact of GLP-1 drugs, pose significant risks. The sentiment in the Q&A was cautious, with unclear guidance updates, contributing to a negative outlook for the stock.
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