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 5.6–6% 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.

• Announced a 25% workforce reduction, board downsizing, and bonus elimination, targeting $4.3 million in annualized savings.

• CEO assumed direct responsibility for sales; COO role created; EVP of Sales and Marketing departed.

• Raised $7 million through a direct offering and amended credit agreement to strengthen liquidity and extend runway.

Financial highlights

• Gross profit for Q3 2024 was $7 million, with gross margin declining to 60.5% from 66.6% year-over-year.

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

• Cash and equivalents at quarter-end were $28 million, down from $43.7 million at year-end 2023.

• 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 million in the prior year.

Outlook and guidance

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

• 2024 net loss guidance: ~$25 million; gross margin ~60%; operating expenses $48–49 million; cash used in operations ~$20.1 million.

• 2025 revenue guidance: $47.6–$49.5 million (2–6% growth); Advanced Energy up 5–10%, 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.

• Company targets cash-flow breakeven in 2025 through cost reductions.