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01/10 16:57
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call shows strong financial performance with a 37% increase in net revenue and improved gross profit margins. Despite a net loss, the company reduced R&D expenses and increased cash position through public offerings. The Q&A section highlights positive retention rates and potential growth from the consignment program and Eon Care. However, there are uncertainties in retention data for the 365 version and revenue impact from Eon Care. Overall, the financial results and strategic initiatives suggest a positive stock price movement in the short term.
Net Revenue $6.6 million in Q2 2025, a 37% increase from $4.9 million in Q2 2024, driven by new Eversense 365 insertions.
Gross Profit $3.1 million in Q2 2025, an increase of $2.8 million from the prior year, due to increased margins on the 365-day product, sales channel mix, and a one-time gain of $0.7 million from VAT recoveries.
Research and Development Expenses $7.7 million in Q2 2025, a decrease of $3.1 million from the prior year, primarily due to reduced clinical study spend and consulting costs after completing the 365-day product trials.
Selling, General and Administrative Expenses $9.7 million in Q2 2025, an increase of $0.7 million from the prior year, driven by sales commission expenses for Ascensia's commercial support.
Net Loss $14.5 million in Q2 2025, a decrease of $5.8 million from $20.3 million in Q2 2024, attributed to improved gross profit margins and reduced R&D costs.
Cash Position $126.7 million as of June 30, 2025, supported by $77.8 million in gross proceeds from a public offering and Abbott investment.
Debt and Accrued Interest $35.3 million as of June 30, 2025.
Eversense 365: The company is focusing on driving awareness and adoption of Eversense 365, a 1-year continuous glucose monitor (CGM). New patient starts increased by 79% year-over-year and 37% from Q1. Leads doubled compared to the prior year, with June leads up 50% over the prior 3-month average. Ascensia hired 12 new inside sales reps to support increased volume.
Gemini and Freedom Systems: Development of Gemini, a self-powered CGM with swipe functionality, is on track for a pivotal study later this year, with a U.S. launch expected by late 2026. Freedom, a CGM with no on-body component, is targeted for launch a year after Gemini.
European Market Expansion: The company expects CE Mark approval for Eversense 365 in Europe and plans to launch later this year. Training of the OUS Ascensia sales team has begun.
Partnerships: Collaborating with Sequel for integration of Eversense 365 with the twiist pump, expected later this year. Plans for additional partnerships with pump manufacturers are underway.
Insertion Network Expansion: Transitioned inserters to the Eon Care network, which now handles 20% of insertions. The network grew by 30% in Q2 and aims to expand to 50 practitioners by year-end and 100 by the end of next year.
Reimbursement Improvements: CMS updated Medicare physician fee schedule to cover a full year of Eversense, leading to increased consignment program business. Some commercial payers are transitioning to bundled payment reimbursement.
Direct-to-Consumer Marketing: Doubling DTC marketing spend to over $10 million in the next two quarters to boost leads and patient growth.
Reverse Stock Split: Plans to seek shareholder approval for a reverse stock split to attract institutional investors and reduce administrative costs.
Regulatory Approval Delays: The company is awaiting CE Mark approval for Eversense 365 in Europe, which could delay the planned commercial launch and impact revenue growth.
Revenue Dependency on Reorders: The transition from a 6-month to a 1-year product has led to reduced reorder volumes in Q2 and Q3, impacting short-term revenue.
Stock Price and Investor Limitations: The company's low stock price has limited participation from institutional investors and may require a reverse stock split to attract broader investment.
Supply Chain and Tariff Risks: The company is monitoring the impact of tariffs and supply chain issues, which could negatively affect gross profit margins.
High Cash Utilization: Projected cash utilization of $60 million in 2025 could strain financial resources, especially if revenue targets are not met.
Competitive Pressures: The company faces competition in the continuous glucose monitoring (CGM) market, which could impact market share and pricing.
Product Development Risks: Delays or issues in the development and approval of new products like Gemini and Freedom could hinder long-term growth.
Reimbursement Challenges: While Medicare and some commercial payers have adopted bundled payment reimbursement, any changes in reimbursement policies could impact revenue.
Revenue Expectations: The company expects full-year 2025 global net revenue to be approximately $34 million to $38 million, with the majority of revenue anticipated in the fourth quarter due to new patient starts and reorders from the first U.S. Eversense 365 patients.
Market Expansion: The company plans to launch Eversense 365 in Europe later this year, pending CE Mark approval, and has begun training the European sales team for readiness.
Product Development: The company is on schedule to start an IDE pivotal study for the Gemini system later this year, targeting a U.S. submission mid-2026 and a commercial launch near the end of 2026. The Freedom program, aiming to deliver a truly invisible CGM, is expected to launch about a year after Gemini.
Marketing and Sales: The company plans to more than double direct-to-consumer (DTC) marketing spend to over $10 million in the next two quarters to boost patient leads and sales conversions. Ascensia has hired additional inside sales reps to support increased volume.
Patient Growth: The company aims to double its global patient base in 2025 compared to 2024, supported by increased DTC marketing and sales efforts.
Reimbursement and Access: Medicare has updated its physician fee schedule to provide payment for a full year of Eversense, and some commercial payers are transitioning to bundled payment reimbursement. The company is expanding its Eon Care network to approximately 50 practitioners by the end of 2025 and 100 by the end of 2026 to improve patient access.
Financial Projections: The company expects full-year gross profit margins between 32.5% and 37.5% and cash utilization of approximately $60 million in 2025.
The selected topic was not discussed during the call.
The earnings call highlights strong financial performance with improved gross margins and reduced net loss. The company is expanding its market presence with product launches in Europe and increased DTC marketing spend. Despite some uncertainties in timelines and payer transitions, the guidance is optimistic with expected patient growth and revenue. Positive trends in patient acquisition and competitive dynamics further support a positive outlook. The Q&A section indicates management's confidence in growth opportunities, although some details were vague. Overall, the sentiment is positive, likely leading to a stock price increase of 2% to 8%.
The earnings call shows strong financial performance with a 37% increase in net revenue and improved gross profit margins. Despite a net loss, the company reduced R&D expenses and increased cash position through public offerings. The Q&A section highlights positive retention rates and potential growth from the consignment program and Eon Care. However, there are uncertainties in retention data for the 365 version and revenue impact from Eon Care. Overall, the financial results and strategic initiatives suggest a positive stock price movement in the short term.
The earnings call presents mixed signals. Strong points include the launch of Eversense 365, increased net revenue, and improved gross profit. However, concerns about regulatory issues, supply chain challenges, and competitive pressures balance these positives. The Q&A section reveals uncertainties about partnerships and integration timelines, further tempering optimism. Financial health is stable, but the lack of clear guidance and ongoing risks suggest a neutral outlook for the stock price over the next two weeks.
The earnings call presents a mixed outlook. Positive aspects include a 24% increase in net revenue and improved gross profit margins, alongside optimistic guidance for 2025. However, risks such as potential delays in CE Mark approval, competitive pressures, and partnership uncertainties with Mercy Health temper the overall sentiment. The Q&A reveals a lack of clarity on certain strategic integrations and commercial plans, adding to uncertainty. Given these factors, the stock is likely to experience a neutral movement in the next two weeks.
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