Zynex (ZYXI) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue grew 11% year-over-year to $49.9 million, driven by a 20% increase in device orders and a larger customer base, marking the ninth consecutive quarter of record orders.

• Net income for Q2 2024 was $1.2 million ($0.04 per diluted share), down from $3.4 million ($0.09 per share) in Q2 2023, reflecting higher operating expenses and changes in product mix.

• Revenue and order growth remain strong, but full-year 2024 revenue is below initial expectations due to product mix and sales force changes.

• Cash provided by operating activities was $3.2 million for the first half of 2024, up 20% year-over-year.

• Working capital stood at $55.9 million and cash and equivalents at $30.9 million as of June 30, 2024.

Financial highlights

• Device revenue reached $15.9 million (up 16% year-over-year), and supplies revenue was $34 million (up 9%), both increasing year-over-year.

• Gross profit was $39.9 million (80% margin), up from $35.7 million (79% margin) in Q2 2023.

• Adjusted EBITDA was $3.5 million, compared to $4 million in the prior year.

• Sales and marketing expenses for Q2 2024 were $23.2 million (47% of revenue), and general and administrative expenses were $14.5 million (29% of revenue).

• Cost of revenue for Q2 2024 was $10.0 million, representing 20% of revenue, down from 21% in Q2 2023.

Outlook and guidance

• 2024 net revenue expected to be approximately $200 million, a 9% increase over 2023, with diluted EPS projected at approximately $0.20.

• Q3 2024 revenue expected to be at least $50 million, with diluted EPS of at least $0.05.

• Management expects a return to 20% top-line growth in the pain management division in 2025.

• Sales and marketing expenses as a percentage of revenue are expected to decrease in the coming quarters.

• Management expects cash and cash equivalents, along with anticipated cash flow from operations, to be sufficient for at least the next twelve months.