NeuroPace (NPCE) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue reached $19.3 million, up 17% year-over-year, driven by RNS System and DIXI Medical product sales.

• Gross margin expanded to 73.4% from 72.5% in Q2 2023, reflecting higher RNS volume and manufacturing efficiencies.

• Net loss narrowed to $7.5 million from $9.1 million in Q2 2023, with disciplined expense management and reduced cash burn.

• Operating expenses grew modestly by 3% to $20.4 million, demonstrating strong operating leverage.

• Sufficient capital to support key priorities into 2026, with cash and short-term investments of $55.5 million as of June 30, 2024, and $59 million in long-term borrowings.

Financial highlights

• Q2 2024 revenue: $19.3 million, up 17% year-over-year; six-month revenue: $37.4 million, up 21%.

• Gross profit for Q2 2024: $14.1 million; gross margin: 73.4% (vs. 72.5% prior year).

• Operating expenses for Q2 2024: $20.4 million, up 3% year-over-year.

• Net loss for Q2 2024: $7.5 million ($0.26/share), improved from $9.1 million ($0.36/share) year-over-year.

• Cash used in operations for six months ended June 30, 2024: $11.4 million, improved from $14.1 million prior year.

Outlook and guidance

• 2024 revenue guidance raised to $76–78 million, representing 16%–19% growth, mainly from RNS System sales.

• Gross margin expected in the 72%–74% range for 2024, with minor variability due to DIXI product mix.

• Operating expenses for 2024 projected at $80–$84 million, including ~$12 million in stock-based compensation.

• No significant fluctuations in OpEx expected for the remainder of 2024, except for a potential Q4 increase due to the AES Annual Meeting.

• Current liquidity is expected to fund operations for at least the next 12 months; future funding needs depend on commercialization and R&D.