TELA Bio (TELA) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue reached $18.5 million, up 12% year-over-year and 5% sequentially, driven by strong demand for OviTex and OviTex PRS products and international growth, partially offset by lower average selling prices due to product mix.

• European business grew 17% year-over-year, highlighting international expansion opportunities.

• Commercial organization restructuring and realignment, including new roles and enhanced training, contributed to improved sales effectiveness, stability, and new account wins.

• Over 69,000 OviTex hernia implantations since inception, with new product launches and expanded surgeon engagement supporting growth.

• Net loss widened to $11.3 million from $5.7 million in Q1 2024, primarily due to the absence of a $7.6 million gain from a prior-year asset sale.

Financial highlights

• OviTex revenue grew 15% and OviTex PRS revenue grew 2% year-over-year; OviTex unit sales up 29%, PRS unit sales down 3% due to a tough prior-year comparison.

• Gross margin was 67.6% in Q1 2025, down from 68.3% in Q1 2024, mainly due to inventory adjustments from new product introductions.

• Sales and marketing expense decreased to $16.6 million from $17.5 million year-over-year, reflecting lower headcount and travel costs.

• Operating expenses totaled $22.9 million, down from $23.7 million, driven by lower compensation costs.

• Cash and cash equivalents totaled $42.8 million at quarter-end, with $53.2 million in working capital.

Outlook and guidance

• Full-year 2025 revenue guidance reaffirmed at $85–88 million, representing 23–27% growth over 2024.

• Operating expenses for 2025 expected to remain flat versus 2024, with operating and net losses projected to decrease over the year.

• Cash resources expected to fund operations for at least the next 12 months.

• Anticipate typical seasonal revenue cadence: larger Q1–Q2 step-up, smaller Q2–Q3 increase, and a strong Q3–Q4 finish.