Apyx Medical (APYX) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue was $11.5 million, down 4–4.1% year-over-year, with Advanced Energy revenue down 6% and OEM revenue up 2.8–3%.

• Net loss attributable to shareholders was $4.7 million ($0.14/share), a slight increase year-over-year; adjusted EBITDA loss improved 20% to $2.4 million.

• Organizational restructuring included a 25% U.S. workforce reduction, board downsizing, and bonus elimination, targeting $4.3 million in annualized savings.

• $7 million direct investment via registered direct offering and amended credit agreement to strengthen liquidity and extend cash runway.

• Launch of Aion Body Contouring System planned, with FDA submission by end of Q1 2025 and launch in H2 2025 pending approval.

Financial highlights

• Gross profit for Q3 2024 was $7 million, with gross margin declining to 60.5% from 66.6% year-over-year due to lower generator prices and sales mix shifts.

• Operating expenses fell 16% to $10.6 million, driven by lower salaries and SG&A.

• Cash and equivalents were $28 million at quarter-end, down from $43.7 million at year start.

• Domestic revenue fell 10% to $7.8 million, while international revenue rose 11% to $3.7 million year-over-year.

• Net cash used in operations for the nine months was $15.1 million, up from $3.0 million in the prior year.

Outlook and guidance

• 2024 revenue expected at $46.6–$47.6 million, down 9–11% year-over-year; Advanced Energy revenue to decline 12–14%, OEM to grow 5%.

• 2024 net loss guidance widened to ~$25 million; gross margin expected at 60%, operating expenses $48–49 million, and cash used in operations ~$20.1 million.

• 2025 revenue guidance of $47.6–$49.5 million (2–6% growth), with Advanced Energy up 5–10% and OEM down 10%; operating expenses capped at $40 million.

• Amended credit agreement sets 2024 Advanced Energy revenue covenant at $34.4 million and 2025 operating expense cap at $40 million.

• The company targets cash-flow breakeven in 2025 through cost reductions and restructuring.