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01/09 22:53
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call highlights several negative factors: reduced revenue guidance, increased dependence on the BARDA contract, rising operating costs, and a net loss increase. Although there are some positive aspects, such as FDA submission progress and positive feedback from international markets, these are overshadowed by the negative financial trends and uncertainties about future revenue and commercialization. The Q&A session further underscores these concerns, with management providing vague responses on critical matters, contributing to a negative sentiment and likely negative stock price reaction.
Cash Balance $10.5 million, remained flat from the second quarter of 2025. This was due to stock option and warrant exercises and efficient operating expense management. Additionally, a registered direct offering in October added $7.6 million to cash reserves.
Research and Development Revenue $3.8 million, decreased from $8.2 million in Q3 2024. The reduction was due to anticipated lower reimbursements under the BARDA Project BioShield contract and reduced direct labor and clinical trial costs after the FDA de novo submission.
Gross Margin 42.7%, decreased from 44.8% in Q3 2024. The decline was attributed to a lower percentage of direct labor as part of total reimbursed costs under the BARDA Project BioShield contract.
General and Administrative Expenses $5 million, increased from $4.6 million in Q3 2024. The rise was due to higher third-party adviser and consulting costs and an increase in non-billable work unrelated to the BARDA Project BioShield contract.
Net Loss $3.6 million, increased from $1.5 million in Q3 2024. The increase was due to reduced research and development revenue and higher general and administrative expenses.
Shares Outstanding 27,251,034 shares as of September 2025.
Cash and Cash Equivalents $10.5 million as of September 30, 2025, up from $5.2 million on December 31, 2024. The increase was due to stock option and warrant exercises and efficient expense management.
DeepView system: The company is preparing for the U.S. launch of the DeepView system next year. The system has broad applications, including burns, and has received support from the burn and wound community. The company is also refining its commercialization strategy.
Market expansion: The company is focusing on the U.S. market for the DeepView system and has not yet included sales contributions from the United Kingdom or Australia in its revenue guidance.
Cash reserves: Cash reserves increased to $10.5 million as of September 30, 2025, up from $5.2 million at the end of 2024. This includes proceeds from stock option exercises and a $7.6 million direct offering in October 2025.
Revenue guidance: Revenue guidance for 2025 was reduced from $21.5 million to $18.5 million due to reduced work on the BARDA Project BioShield contract and timing effects from the U.S. government shutdown.
Net loss: The company reported a net loss of $3.6 million for Q3 2025, compared to $1.5 million in Q3 2024, due to reduced R&D revenue and higher administrative expenses.
FDA submission: The FDA submission for the DeepView system was completed in June 2025. The company is actively engaging with the FDA on the de novo application despite delays caused by the U.S. government shutdown.
Commercialization strategy: The company is working with BARDA partners to bring the DeepView system to market and is refining its commercialization strategy for a planned release next year.
FDA Submission Delays: The U.S. government shutdown has slowed interactions with the FDA on the de novo application, potentially delaying the approval process for the DeepView system.
Reduced R&D Revenue: Research and development revenue decreased significantly from $8.2 million in Q3 2024 to $3.8 million in Q3 2025, reflecting reduced reimbursements under the BARDA Project BioShield contract.
Increased Net Loss: The company reported a net loss of $3.6 million in Q3 2025, up from $1.5 million in Q3 2024, due to reduced R&D revenue and higher general and administrative expenses.
Lower Gross Margin: Gross margin decreased to 42.7% in Q3 2025 from 44.8% in Q3 2024, driven by a lower percentage of direct labor as a portion of reimbursed costs under the BARDA contract.
Revenue Guidance Reduction: Revenue guidance for 2025 was reduced from $21.5 million to $18.5 million, attributed to reduced work on the BARDA contract and timing effects from the U.S. government shutdown.
Dependence on BARDA Contract: The company's financial performance is heavily reliant on the BARDA Project BioShield contract, which has seen reduced activity and reimbursements.
Increased Operating Costs: General and administrative expenses rose to $5 million in Q3 2025 from $4.6 million in Q3 2024, driven by higher third-party adviser and consulting costs and non-billable work.
Revenue Guidance: The company has reduced its revenue guidance for 2025 from $21.5 million to $18.5 million. This reduction is attributed to anticipated reduced work on the BARDA Project BioShield contract following the FDA submission and timing effects from the U.S. government shutdown. The company expects to recover these effects largely within the first half of 2026. The guidance does not include potential sales of the DeepView system for burn indications in the United Kingdom or Australia.
Product Commercialization: The company plans to launch the DeepView system in the U.S. next year, with ongoing preparations for its commercialization strategy. The system is expected to have broad applications beyond burns, supported by the burn and wound care community.
FDA Submission and Approval: The FDA submission for the DeepView system was completed in June 2025. The company is actively engaging with the FDA on the de novo application process, despite some delays caused by the U.S. government shutdown.
Financial Position: The company has over $10 million in cash reserves as of September 2025, with an additional $7.6 million raised through a registered direct offering in October 2025. This funding is deemed sufficient to support operations and product commercialization efforts for the foreseeable future.
The selected topic was not discussed during the call.
The earnings call highlights several negative factors: reduced revenue guidance, increased dependence on the BARDA contract, rising operating costs, and a net loss increase. Although there are some positive aspects, such as FDA submission progress and positive feedback from international markets, these are overshadowed by the negative financial trends and uncertainties about future revenue and commercialization. The Q&A session further underscores these concerns, with management providing vague responses on critical matters, contributing to a negative sentiment and likely negative stock price reaction.
The earnings call reveals several concerning factors: a decreased gross margin, increased net loss, and heavy reliance on FDA approval and BARDA contract. The Q&A section indicates management's uncertainty regarding commercialization timelines and reliance on government contracts. Despite a reduction in G&A expenses, the financial strain from a significant net loss and limited revenue diversification suggests a negative outlook. The lack of immediate sales in international markets further compounds these issues. Consequently, the predicted stock price movement over the next two weeks is negative (-2% to -8%).
The earnings call presents a mixed picture. Positive aspects include improved financial metrics, reduced losses, and a strong cash position. However, concerns arise from reliance on debt financing, competitive pressures, and vague responses in the Q&A about FDA deliverables and DoD contracts. The strong revenue growth and optimistic guidance are offset by uncertainties in operational changes and market competition, leading to a neutral sentiment prediction for stock price movement.
The earnings call presents a mixed picture: strong R&D revenue growth and reduced operating losses are positive, but reliance on debt financing and potential operational challenges pose risks. The Q&A reveals uncertainty around FDA deliverables and DoD contracts, which could concern investors. Despite the optimistic guidance and financial improvements, the lack of clarity and potential risks balance out the positives, resulting in a neutral sentiment.
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