NeurAxis (NRXS) Q2 2024 earnings summary

Executive summary

• Insurance coverage for IB-Stim expanded to 22.5 million lives, with a major payer adding 12 million more in October 2024, and 15 additional payers under review, supporting future revenue growth and profitability in 2025.

• Academic society NASPGHAN granted IB-Stim the highest grade certainty, expected to drive guideline publication and further insurance adoption.

• Commercialization of the RED device is on track for late 2024, with FDA submission completed and strong reimbursement infrastructure in place.

• Clinical research and real-world studies show significant improvements in pediatric DGBI outcomes with IB-Stim.

• Focused on neuromodulation therapies for pediatric chronic conditions, with IB-Stim as the primary FDA-cleared product.

Financial highlights

• Q2 2024 revenue was $611,500–$612,000, down 5.3%–5% year-over-year, with unit sales up 16% and a smaller decline than prior quarters.

• Gross profit for Q2 2024 was $538,000 with an 88% gross margin, slightly down from 89.5% in Q2 2023 due to discounted financial assistance sales.

• Operating loss for Q2 2024 was $2.2M–$2.21M, up from $1.1M in Q2 2023, driven by higher G&A, public company costs, and $435,000 in nonrecurring severance and consulting.

• Net loss for Q2 2024 was $2.9M–$2.92M, up 30.5% year-over-year, with improved liquidity: $1.8M cash on hand as of June 30, 2024, and $4.2M–$6.1M in committed capital.

• Accumulated deficit reached $5.26M as of June 30, 2024; working capital deficit was $5.48M; short-term borrowings totaled $4.77M–$4.8M.

Outlook and guidance

• Insurance coverage is expected to double to 50 million lives in 2H24, supporting revenue growth in late 2024 and 2025.

• Profitability targeted for Q1 2025, contingent on guideline publication and payer adoption.

• Cash burn rate is $400,000–$500,000 per month, with a 12-month runway based on current liquidity and committed capital; cash is expected to meet needs only through year-end.

• Future capital needs depend on insurance adoption, R&D, and regulatory milestones.