PART I. Financial Information Presents unaudited consolidated financial statements and management's discussion of financial condition and operations [ITEM 1. Condensed Consolidated Financial Statements (Unaudited)](index=4&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20(Unaudited)) This section presents the unaudited condensed consolidated financial statements of Apyx Medical Corporation for the periods ended June 30, 2025, and December 31, 2024, including balance sheets, statements of operations, changes in equity, and cash flows, along with detailed notes explaining the basis of presentation, recent accounting pronouncements, and specific financial line items [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section provides a snapshot of the company's financial position, detailing assets, liabilities, and equity at specific reporting dates Condensed Consolidated Balance Sheets (in thousands) | Metric (in thousands) | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Total current assets | $49,915 | $56,440 | | Total assets | $58,188 | $64,842 | | Total current liabilities | $10,566 | $10,721 | | Total liabilities | $50,732 | $50,507 | | Total stockholders' equity | $7,253 | $14,210 | | Total equity | $7,456 | $14,335 | - Total assets decreased by approximately **$6.65 million** from December 31, 2024, to June 30, 2025, primarily driven by a reduction in current assets, including cash and cash equivalents and trade accounts receivable[8](index=8&type=chunk) - Total equity significantly decreased from **$14.335 million** at December 31, 2024, to **$7.456 million** at June 30, 2025, largely due to an accumulated deficit[8](index=8&type=chunk) [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This section details the company's financial performance over specific periods, including sales, gross profit, and net loss Condensed Consolidated Statements of Operations (in thousands, except per share) | Metric (in thousands, except per share) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Sales | $11,373 | $12,149 | $20,803 | $22,393 | | Gross profit | $7,083 | $7,493 | $12,748 | $13,442 | | Loss from operations | $(2,574) | $(5,547) | $(5,625) | $(12,162) | | Net loss attributable to stockholders | $(3,778) | $(6,556) | $(7,928) | $(14,132) | | Basic and diluted loss per share | $(0.09) | $(0.19) | $(0.19) | $(0.41) | - Sales decreased by **6.4%** for the three months ended June 30, 2025, and by **7.1%** for the six months ended June 30, 2025, compared to the prior year periods[11](index=11&type=chunk) - Net loss attributable to stockholders significantly improved, decreasing from **$(6,556) thousand** to **$(3,778) thousand** for the three months ended June 30, 2025, and from **$(14,132) thousand** to **$(7,928) thousand** for the six months ended June 30, 2025, primarily due to reduced operating expenses[11](index=11&type=chunk) [Condensed Consolidated Statements of Changes in Equity](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Equity) This section outlines the changes in the company's equity components, including common stock, additional paid-in capital, and accumulated deficit Condensed Consolidated Statements of Changes in Equity (in thousands) | Metric (in thousands) | Balance at Dec 31, 2024 | Balance at June 30, 2025 | | :-------------------- | :---------------------- | :----------------------- | | Common Stock Par Value | $38 | $38 | | Additional Paid-In Capital | $92,083 | $93,054 | | Accumulated Deficit | $(77,911) | $(85,839) | | Non-controlling Interest | $125 | $203 | | Total Equity | $14,335 | $7,456 | - Total equity decreased by **$6,879 thousand** from December 31, 2024, to June 30, 2025, primarily due to net losses, partially offset by stock-based compensation and contributions from non-controlling interest[13](index=13&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section presents the cash inflows and outflows from operating, investing, and financing activities, reflecting the company's liquidity Condensed Consolidated Statements of Cash Flows (in thousands) | Metric (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------- | :----------------------------- | :----------------------------- | | Net cash used in operating activities | $(1,935) | $(10,670) | | Net cash used in investing activities | $(320) | $(324) | | Net cash provided by (used in) financing activities | $50 | $(10) | | Net change in cash and cash equivalents | $(2,440) | $(10,974) | | Cash and cash equivalents, end of period | $29,301 | $32,678 | - Net cash used in operating activities significantly decreased from **$(10.67) million** in H1 2024 to **$(1.935) million** in H1 2025, driven by improved accounts receivable and reduced operating losses[16](index=16&type=chunk)[95](index=95&type=chunk) - Cash and cash equivalents decreased by **$2.44 million** in H1 2025, ending the period at **$29.301 million**[16](index=16&type=chunk)[94](index=94&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations and disclosures for the financial statements, covering accounting policies and specific line items [NOTE 1. BASIS OF PRESENTATION](index=8&type=section&id=NOTE%201.%20BASIS%20OF%20PRESENTATION) Apyx Medical Corporation, incorporated in 1982, is an advanced energy technology company specializing in Helium Plasma Platform Technology products (Renuvion® and J-Plasma®) for cosmetic and hospital surgical markets, and OEM agreements. The company received 510(k) clearance for its AYON Body Contouring System™ in May 2025, with a commercial launch planned for H2 2025. Despite recurring net losses and cash outflows, the company plans to fund operations through existing cash, product sales, and potential additional financing. A cost-saving restructuring in November 2024, including a 25% workforce reduction, is expected to yield $4.3 million in annualized savings and reduce annual operating expenses below $40 million in fiscal 2025 - Apyx Medical Corporation received 510(k) clearance from the FDA for its AYON Body Contouring System™ on May 13, 2025, with commercial launch anticipated in the second half of 2025[21](index=21&type=chunk)[68](index=68&type=chunk) - The company implemented a cost-saving restructuring in November 2024, reducing its US workforce by nearly **25%**, with estimated annualized future cost savings of approximately **$4.3 million**[24](index=24&type=chunk)[71](index=71&type=chunk) - Total annual operating expenses are projected to be reduced below **$40 million** in fiscal 2025 due to identified cost savings, including reductions in professional fees, R&D, credit card fees, and stock-based compensation[24](index=24&type=chunk)[71](index=71&type=chunk) [NOTE 2. RECENT ACCOUNTING PRONOUNCEMENTS](index=9&type=section&id=NOTE%202.%20RECENT%20ACCOUNTING%20PRONOUNCEMENTS) The company adopted ASU 2023-09, Income Taxes (Topic 740), on January 1, 2025, expecting incremental disclosures in its 2025 Annual Report. It is currently evaluating the impact of ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40), effective for fiscal years beginning after December 15, 2026 - The Company adopted ASU 2023-09, Income Taxes (Topic 740), on January 1, 2025, which will lead to incremental disclosures in its 2025 Annual Report on Form 10-K[25](index=25&type=chunk) - The Company is evaluating the impact of ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40), effective for fiscal years beginning after December 15, 2026[26](index=

Core Points - Apyx Medical Corporation granted a nonstatutory stock option to John Featherstone, Vice President of North American Sales, for 100,000 shares as an inducement for employment [1][2] - The stock option has an exercise price of $1.85, which is the closing price of Apyx Medical's common stock on the grant date [2] - The stock option vests over a four-year period, with 25% vesting on the first anniversary and the remainder vesting annually, contingent on continued employment [2] Company Overview - Apyx Medical Corporation specializes in advanced energy technology, focusing on innovative products such as the Helium Plasma Platform Technology, marketed as Renuvion and AYON Body Contouring System in the cosmetic surgery market, and J-Plasma in the hospital surgical market [3] - Renuvion and J-Plasma provide surgeons with the ability to deliver controlled heat to tissue, supported by over 90 clinical documents [3] - The company also engages in OEM agreements with other medical device manufacturers, leveraging its expertise in unique waveforms [3]

[Second Quarter 2025 Earnings Report Overview](index=1&type=section&id=Second%20Quarter%202025%20Earnings%20Report%20Overview) Apyx Medical reported Q2 2025 financial results, including $11.4 million revenue, reduced net loss, and launched AYON Body Contouring System and Renuvion in China, raising full-year guidance [Recent Financial and Operating Highlights](index=1&type=section&id=Recent%20Financial%20and%20Operating%20Highlights) Apyx Medical achieved key operational milestones with the AYON Body Contouring System™ launch and Renuvion® sales in China, alongside improved Q2 2025 financial metrics - Apyx Medical successfully launched the AYON Body Contouring System™ to key surgeons in critical geographies and initiated commercial sales of Renuvion® in China with strong clinical interest, leading to an increased full-year 2025 revenue guidance[3](index=3&type=chunk)[4](index=4&type=chunk) Second Quarter 2025 Key Financial Highlights: | Metric | Q2 2025 | Q2 2024 | Change ($) | Change (%) | | :-------------------------------- | :-------- | :-------- | :--------- | :--------- | | Total Revenue | $11.4M | $12.1M | $(0.7M) | (6.4)% | | Advanced Energy Revenue | $9.7M | $9.8M | $(0.1M) | (1.0)% | | OEM Revenue | $1.7M | $2.4M | $(0.7M) | (28.5)% | | Net Loss Attributable to Stockholders | $(3.8M) | $(6.6M) | $2.8M | (42)% | | Adjusted EBITDA Loss | $(2.0M) | $(4.3M) | $2.3M | (54)% | - The AYON Body Contouring System™ received 510(k) clearance from the U.S. Food and Drug Administration (FDA) and is an all-in-one system integrating advanced modalities for fat removal, tissue contraction, and aesthetic enhancement[4](index=4&type=chunk) - The company strengthened its management team with the appointments of John Featherstone as Vice President of North American Sales and Simon Davies as Director of International Sales, Europe and Asia-Pacific, to drive sustained sales growth worldwide[4](index=4&type=chunk) [Second Quarter 2025 Financial Performance Analysis](index=2&type=section&id=Second%20Quarter%202025%20Financial%20Performance%20Analysis) Apyx Medical's Q2 2025 financial performance showed decreased revenue, improved gross margin, reduced operating expenses, and a significant reduction in net and Adjusted EBITDA losses [Revenue Analysis](index=2&type=section&id=Revenue%20Analysis) Total revenue for Q2 2025 decreased by 6.4% year-over-year to $11.4 million. Advanced Energy revenue remained relatively flat, while OEM revenue saw a significant decline of 28.5% due to decreased sales volume to existing customers. Domestic sales decreased, while international sales showed a slight increase Revenue by Segment (Three Months Ended June 30): | Segment | 2025 (in thousands) | 2024 (in thousands) | $ Change | % Change | | :---------------- | :------------------ | :------------------ | :------- | :------- | | Advanced Energy | $9,670 | $9,766 | $(96) | (1.0)% | | OEM | $1,703 | $2,383 | $(680) | (28.5)% | | **Total** | **$11,373** | **$12,149** | **$(776)** | **(6.4)%** | Revenue by Geography (Three Months Ended June 30): | Geography | 2025 (in thousands) | 2024 (in thousands) | $ Change | % Change | | :---------------- | :------------------ | :------------------ | :------- | :------- | | Domestic | $7,776 | $8,687 | $(911) | (10.5)% | | International | $3,597 | $3,462 | $135 | 3.9% | | **Total** | **$11,373** | **$12,149** | **$(776)** | **(6.4)%** | - The decrease in OEM sales was primarily due to decreases in sales volume to existing customers, including Symmetry Surgical under the Company's 10-year generator manufacturing and supply agreement[6](index=6&type=chunk) [Gross Profit and Margin](index=2&type=section&id=Gross%20Profit%20and%20Margin) Gross profit decreased to $7.1 million in Q2 2025 from $7.5 million in the prior year, but gross margin improved to 62.3% from 61.7%. This margin improvement was primarily driven by a favorable product mix, with Advanced Energy comprising a higher percentage of total sales Gross Profit and Margin (Three Months Ended June 30): | Metric | 2025 (in thousands) | 2024 (in thousands) | | :---------- | :------------------ | :------------------ | | Gross Profit | $7,083 | $7,493 | | Gross Margin | 62.3% | 61.7% | - The increase in gross margin is primarily attributable to changes in product mix between segments, with Advanced Energy comprising a higher percentage of total sales, as well as product mix within the Advanced Energy segment[7](index=7&type=chunk) [Operating Expenses](index=3&type=section&id=Operating%20Expenses) Operating expenses significantly decreased by $3.4 million to $9.7 million for the three months ended June 30, 2025, primarily due to reductions in salaries and related costs, selling, general and administrative expenses, research and development expenses, and professional services expenses - Operating expenses decreased **$3.4 million** to **$9.7 million** for Q2 2025, driven by[9](index=9&type=chunk)[22](index=22&type=chunk) * **$1.6 million** decrease in salaries and related costs * **$0.7 million** decrease in selling, general and administrative expenses * **$0.6 million** decrease in research and development expenses * **$0.5 million** decrease in professional services expenses [Other Income/Expense and Income Tax](index=3&type=section&id=Other%20Income%2FExpense%20and%20Income%20Tax) Other expense, net, slightly increased to $1.1 million in Q2 2025, mainly due to a decrease in interest income. Income tax expense remained stable at $49,000 Other Expense, Net and Income Tax (Three Months Ended June 30): | Metric | 2025 (in thousands) | 2024 (in thousands) | | :---------------- | :------------------ | :------------------ | | Other expense, net | $1,115 | $989 | | Income tax expense | $49 | $50 | - The increase in other expense, net, was primarily due to a **$0.2 million** decrease in interest income[10](index=10&type=chunk) [Net Loss and EPS](index=3&type=section&id=Net%20Loss%20and%20EPS) Net loss attributable to stockholders decreased substantially by 42% to $3.8 million, or $0.09 per share, for the three months ended June 30, 2025, compared with $6.6 million, or $0.19 per share, in the prior year period Net Loss and EPS (Three Months Ended June 30): | Metric | 2025 | 2024 | Change ($) | Change (%) | | :-------------------------------- | :----- | :----- | :--------- | :--------- | | Net loss attributable to stockholders | $(3.8M) | $(6.6M) | $2.8M | (42)% | | Loss per share (Basic and diluted) | $(0.09) | $(0.19) | $0.10 | (52.6)% | [Adjusted EBITDA](index=3&type=section&id=Adjusted%20EBITDA) Adjusted EBITDA loss improved by 54% to $2.0 million for the three months ended June 30, 2025, down from $4.3 million in the comparable prior year period, reflecting improved operational efficiency Adjusted EBITDA Loss (Three Months Ended June 30): | Metric | 2025 (in thousands) | 2024 (in thousands) | $ Change | % Change | | :---------------- | :------------------ | :------------------ | :------- | :------- | | Adjusted EBITDA Loss | $(1,962) | $(4,312) | $2,350 | (54.5)% | [Full Year 2025 Financial Guidance](index=3&type=section&id=Financial%20Guidance%20for%20Full%20Year%202025) Apyx Medical revised its full-year 2025 financial guidance upwards, projecting total revenue between $50.0 million and $52.0 million, an increase from previous guidance. This revision is driven by increased expectations for Advanced Energy revenue, while OEM revenue is expected to decrease. Operating expenses are projected to be less than $40.0 million Revised Full Year 2025 Revenue Guidance: | Metric | Previous Guidance | Revised Guidance | FY 2024 Actual | | :---------------------- | :------------------ | :--------------- | :------------- | | Total Revenue | $47.6M - $49.0M | $50.0M - $52.0M | $48.1M | | Advanced Energy Revenue | $39.6M - $41.0M | $42.0M - $44.0M | $38.6M | | OEM Revenue | ~$8.0M (implied) | ~$8.0M | $9.5M | - The Company expects total operating expenses of less than **$40.0 million** for the year ended December 31, 2025[13](index=13&type=chunk) [Company and Product Information](index=4&type=section&id=Company%20and%20Product%20Information) This section provides details on the Q2 2025 conference call, introduces the AYON Body Contouring System, outlines Apyx Medical's core business, and includes a cautionary statement on forward-looking information [Conference Call Details](index=4&type=section&id=Conference%20Call%20Details) Management hosted a conference call on August 7, 2025, at 4:30 p.m. Eastern Time to discuss the second quarter 2025 results, with details provided for phone access and a live webcast - A conference call was hosted on August 7, 2025, at 4:30 p.m. Eastern Time to discuss the second quarter 2025 results and host a question and answer session[14](index=14&type=chunk) - Interested parties could listen to the call by phone (800-717-1738 or 646-307-1865 for international callers, access code 35370) or via a live webcast accessible through the Investor Relations section of the Company's website[14](index=14&type=chunk) [About AYON Body Contouring System™](index=4&type=section&id=About%20AYON%20Body%20Contouring%20System%E2%84%A2) AYON is a groundbreaking, surgeon-designed all-in-one body contouring system that combines precision, versatility, and innovation, integrating fat removal, closed-loop contouring, tissue contraction, and electrosurgical capabilities to deliver comprehensive treatments - AYON is a surgeon-designed body contouring system that integrates fat removal, closed loop contouring, tissue contraction, and electrosurgical capabilities in an all-in-one platform[15](index=15&type=chunk) - The system features LIFT Technology for real-time adjustments and Renuvion for enhanced tissue contraction, aiming to streamline procedures and maximize patient outcomes[15](index=15&type=chunk) [About Apyx Medical Corporation](index=4&type=section&id=About%20Apyx%20Medical%20Corporation) Apyx Medical Corporation is an advanced energy technology company specializing in Helium Plasma Platform Technology products like Renuvion, J-Plasma, and the new AYON Body Contouring System for cosmetic and hospital surgical markets, supported by extensive clinical documentation and OEM agreements - Apyx Medical Corporation is an advanced energy technology company focused on its proprietary Helium Plasma Platform Technology products, marketed as Renuvion® and the AYON Body Contouring System™ in cosmetic surgery, and J-Plasma® in the hospital surgical market[16](index=16&type=chunk) - The company also leverages its expertise in unique waveforms through OEM agreements with other medical device manufacturers[16](index=16&type=chunk) [Cautionary Statement on Forward-Looking Statements](index=4&type=section&id=Cautionary%20Statement%20on%20Forward-Looking%20Statements) This section advises that certain discussions and oral statements may contain forward-looking information, which is subject to inherent risks, trends, and uncertainties that could cause actual results to differ materially from projections. The company claims the protection of the safe harbor provisions and assumes no obligation to update these statements - Forward-looking statements are subject to certain risks, trends, and uncertainties that could cause actual results to differ materially from those projected, including regulatory approvals, supply chain disruptions, and macroeconomic or geopolitical matters[19](index=19&type=chunk)[20](index=20&type=chunk) - The Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and assumes no obligation to update or supplement any forward-looking statements[20](index=20&type=chunk) [Financial Statements](index=6&type=section&id=Financial%20Statements) This section presents the condensed consolidated statements of operations and balance sheets, providing a detailed overview of the company's financial performance and position [Condensed Consolidated Statements of Operations](index=6&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) The condensed consolidated statements of operations provide a detailed breakdown of revenues, cost of sales, gross profit, operating expenses, and net loss for the three and six months ended June 30, 2025, and 2024 Condensed Consolidated Statements of Operations (Unaudited, In thousands, except per share data): | (In thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Sales | $11,373 | $12,149 | $20,803 | $22,393 | | Cost of sales | 4,290 | 4,656 | 8,055 | 8,951 | | Gross profit | 7,083 | 7,493 | 12,748 | 13,442 | | Total other costs and expenses | 9,657 | 13,040 | 18,373 | 25,604 | | Loss from operations | (2,574) | (5,547) | (5,625) | (12,162) | | Total other expense, net | (1,115) | (989) | (2,187) | (1,911) | | Loss before income taxes | (3,689) | (6,536) | (7,812) | (14,073) | | Income tax expense | 49 | 50 | 98 | 103 | | Net loss | (3,738) | (6,586) | (7,910) | (14,176) | | Net loss attributable to stockholders | $(3,778) | $(6,556) | $(7,928) | $(14,132) | | Loss per share: Basic and diluted | $(0.09) | $(0.19) | $(0.19) | $(0.41) | [Condensed Consolidated Balance Sheets](index=7&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) The condensed consolidated balance sheets present the company's financial position as of June 30, 2025, and December 31, 2024, detailing assets, liabilities, and equity Condensed Consolidated Balance Sheets (In thousands, except share and per share data): | (In thousands) | June 30, 2025 (Unaudited) | December 31, 2024 | | :-------------------------------- | :-------------------------- | :------------------ | | **ASSETS** | | | | Cash and cash equivalents | $29,301 | $31,741 | | Total current assets | 49,915 | 56,440 | | Total assets | $58,188 | $64,842 | | **LIABILITIES AND EQUITY** | | | | Total current liabilities | $10,566 | $10,721 | | Long-term debt, net | 34,365 | 33,893 | | Total liabilities | 50,732 | 50,507 | | Total stockholders' equity | 7,253 | 14,210 | | Total equity | 7,456 | 14,335 | | Total liabilities and equity | $58,188 | $64,842 | [Reconciliation of GAAP Net Loss to Non-GAAP Adjusted EBITDA](index=8&type=section&id=RECONCILIATION%20OF%20GAAP%20NET%20LOSS%20TO%20NON-GAAP%20ADJUSTED%20EBITDA) This section provides a reconciliation of GAAP net loss to non-GAAP Adjusted EBITDA, defining Adjusted EBITDA as net income (loss) attributable to stockholders adjusted for income tax, interest, depreciation, amortization, stock-based compensation, and other non-recurring items, used by management and investors as a measure of operating performance - Adjusted EBITDA is defined as the reported net income (loss) attributable to stockholders (GAAP) plus income tax expense (benefit), interest, depreciation and amortization, stock-based compensation expense, and other significant non-recurring items[26](index=26&type=chunk) Reconciliation of GAAP Net Loss to Non-GAAP Adjusted EBITDA (Unaudited, In thousands): | (In thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net loss attributable to stockholders | $(3,778) | $(6,556) | $(7,928) | $(14,132) | | Interest income | (278) | (439) | (582) | (934) | | Interest expense | 1,393 | 1,427 | 2,769 | 2,823 | | Income tax expense | 49 | 50 | 98 | 103 | | Depreciation and amortization | 132 | 156 | 270 | 313 | | Stock-based compensation | 520 | 1,050 | 971 | 2,178 | | **Adjusted EBITDA** | **$(1,962)** | **$(4,312)** | **$(4,402)** | **$(9,649)** |

Company Overview - Apyx Medical Corporation specializes in advanced energy technology, focusing on innovative products such as Renuvion® and the AYON Body Contouring System™ for the cosmetic surgery market, as well as J-Plasma® for the hospital surgical market [3] - The company's technologies provide surgeons with the ability to deliver controlled heat to tissue, supported by over 90 clinical publications [3] Upcoming Events - Management will participate in the Canaccord Genuity 45th Annual Growth Conference on August 12, 2025, in Boston, MA [1] - The President and CEO, Charlie Goodwin, along with CFO, Matt Hill, will engage in a fireside chat at 4:00 PM ET and will hold one-on-one meetings with investors throughout the day [2] Investor Relations - For further inquiries, the investor relations contact is Jeremy Feffer, Managing Director at LifeSci Advisors, reachable at 212-915-2568 or via email [4]

Core Insights - Apyx Medical Corporation has launched Renuvion in China, marking a significant step in its global expansion strategy [2][3] - The company has entered into a distribution agreement with GlamMoon Medical Technology, a division of BeauCare Clinics Investment Co., Ltd., to facilitate the sales and marketing of Renuvion in the Chinese market [1][2] - Initial market clearance has been received from the National Medical Products Administration of China, indicating regulatory approval for the product [1] Company Overview - Apyx Medical Corporation specializes in advanced energy technology, focusing on innovative products such as Renuvion and J-Plasma, which provide controlled heat to tissue for surgical applications [3] - The effectiveness of Renuvion and J-Plasma is supported by over 90 clinical documents, showcasing the company's commitment to clinical validation [3] Partner Overview - BeauCare Clinics Investment Co., Ltd. (BCC) is a leading player in China's medical aesthetics industry, operating over 60 medical aesthetics hospitals and clinics across 15 cities [4] - BCC has established a strong supply chain and a group purchasing alliance with over 400 members, enhancing its market position in the medical aesthetics sector [4]

Core Viewpoint - Apyx Medical Corporation will release its financial results for Q2 of fiscal year 2025 on August 7, 2025, after market close [1] Financial Results Announcement - The financial results will be discussed in a conference call scheduled for 4:30 p.m. Eastern Time on the same day [2] - Interested parties can join the call by dialing 800-717-1738 or 646-307-1865 for international callers, using access code 35370 [2] - A live webcast of the call will be available on the company's website and will be archived for future reference [2] Company Overview - Apyx Medical Corporation specializes in advanced energy technology, focusing on innovative products like Renuvion and the AYON Body Contouring System™ [3] - The company’s Helium Plasma Platform Technology is utilized in both cosmetic surgery and hospital surgical markets, providing surgeons with controlled heat to achieve desired results [3] - The effectiveness of Renuvion and J-Plasma is supported by over 90 clinical publications, showcasing the company's commitment to clinical validation [3] - Apyx Medical also engages in OEM agreements with other medical device manufacturers, leveraging its expertise in unique waveforms [3]

Core Insights - Apyx Medical Corporation is showcasing its Renuvion technology at Miami Swim Week, emphasizing real patient transformations and the empowerment of individuals through body contouring solutions [1][2][3] Company Overview - Apyx Medical Corporation specializes in advanced energy technology, particularly its Helium Plasma Platform Technology, marketed as Renuvion, and the AYON Body Contouring System™ [5] - The company provides innovative products that enable surgeons to deliver controlled heat to tissue, supported by over 90 clinical documents [5] Product Highlights - Renuvion combines helium plasma and radiofrequency energy to achieve tissue contraction and collagen remodeling, making it a trusted tool for plastic surgeons globally [3] - The technology addresses loose skin concerns, which affect millions, offering a solution with minimal downtime [2][3] Marketing and Branding - The company aims to redefine beauty standards by highlighting real patient journeys and encouraging self-acceptance through its marketing efforts at major cultural events [3] - Apyx Medical's mission extends beyond aesthetics, focusing on restoring confidence to individuals struggling with loose skin [3]

Core Viewpoint - Apyx Medical Corporation has received FDA 510(k) clearance for the AYON Body Contouring System, marking a significant advancement in aesthetic surgical technology and is set to launch commercially in the second half of 2025 [1][6]. Group 1: Product Overview - The AYON Body Contouring System is an all-in-one platform designed for body contouring, integrating fat removal, closed loop contouring, tissue contraction, and electrosurgical capabilities [3][4]. - It features LIFT Technology for real-time adjustments and Renuvion for enhanced tissue contraction, aiming to improve surgical precision and patient outcomes [3][6]. - The system is expected to revolutionize body contouring procedures and is backed by Apyx Medical's expertise and evidence-based design [3][6]. Group 2: Market Context - The aesthetics market is projected to see a rapid increase in body contouring procedures, particularly as over 15 million patients using GLP-1 drugs experience significant weight loss and seek solutions for loose skin [6]. - The initial FDA clearance for AYON covers various aesthetic treatments, including ultrasound-assisted liposuction and electrocoagulation for tissue removal, with plans for further indications like power liposuction [4][5]. Group 3: Company Background - Apyx Medical Corporation specializes in advanced energy technology, particularly its Helium Plasma Platform Technology products marketed as Renuvion and the AYON Body Contouring System [7]. - The effectiveness of Renuvion and J-Plasma technologies is supported by over 90 clinical documents, showcasing the company's commitment to innovation in surgical solutions [7].

Revenue Performance - Total revenue decreased by 7.9%, or approximately $0.8 million, for the three months ended March 31, 2025, compared to the same period in 2024[78]. - Advanced Energy segment sales increased by 5.8%, or approximately $0.4 million, driven by increased volume of single-use handpieces domestically[78]. - OEM segment sales decreased by 44.7%, or approximately $1.2 million, due to decreases in sales volume to existing customers[78]. - International sales represented approximately 28.5% of total revenues for the three months ended March 31, 2025[79]. Profitability and Expenses - Gross profit for the three months ended March 31, 2025, decreased 4.8% to $5.7 million, with a gross margin of 60.1%[80]. - Research and development expenses decreased by 42.4% to $0.8 million, primarily due to lower compensation and benefits costs[82]. - Salaries and related expenses decreased by 34.4% to $3.1 million, attributed to a reduction in workforce and discretionary bonuses[84]. - Selling, general and administrative (SG&A) expenses decreased by 30.9% to $3,382,000 for the three months ended March 31, 2025, compared to $4,897,000 in the same period of 2024, representing 35.9% of sales[85]. Future Outlook and Cost Management - The company anticipates clearance for the AYON device by the FDA in the first half of 2025, with a launch planned later in the year[70]. - The company expects annualized future cost savings of approximately $4.3 million from a workforce reduction of nearly 25%[72]. - The company plans to reduce annual operating expenses below $40 million in 2025 through identified cost savings initiatives[72]. Financial Position - Cash and cash equivalents decreased to approximately $31.0 million as of March 31, 2025, from approximately $31.7 million at December 31, 2024[91]. - Net cash used in operating activities improved to approximately $0.7 million for the three months ended March 31, 2025, compared to $6.3 million in the same period of 2024[92]. - The company has incurred recurring net losses and anticipates that losses will continue in the near term, planning to fund operations through existing cash and potential additional financing[94]. - As of March 31, 2025, the company had purchase commitments totaling approximately $2.9 million, expected to be purchased within the next twelve months[99]. Compliance and Agreements - The company entered into an amendment to the Perceptive Credit Agreement, reducing financial covenant revenue targets for the Advanced Energy segment to $37.0 million for 2025[96]. - The company was in compliance with the financial covenants of the Perceptive Credit Agreement as of March 31, 2025[96]. - Apyx Medical Corporation's financial report was signed by CEO Charles D. Goodwin II and CFO Matthew Hill on May 8, 2025[123][124]. Interest and Taxation - Interest income decreased by approximately $0.2 million to $304,000 for the three months ended March 31, 2025, compared to $495,000 in the same period of 2024, with a percentage of sales decline from 4.8% to 3.2%[86]. - Interest expense remained flat at approximately $1.4 million for both the three months ended March 31, 2025, and 2024[87]. - Income tax expense was approximately $49,000 for the three months ended March 31, 2025, compared to $53,000 in the same period of 2024, with effective tax rates of (1.2)% and (0.7)%, respectively[89].

Financial Data and Key Metrics Changes - Total revenue for Q1 2025 was $9.4 million, a decrease of 8% compared to $10.2 million in the same period last year [4] - Advanced Energy products revenue increased by 6% to $7.9 million, reflecting stronger sales trends in the U.S. [5] - OEM segment sales decreased by 44.7% to approximately $1.2 million [16] - Gross profit for Q1 2025 decreased to $5.7 million from $5.9 million in the prior year, but gross profit margin increased to 60.1% from 58.1% [16][17] - Net loss attributable to shareholders was $4.2 million or $0.10 per share, compared to $7.6 million or $0.22 per share in the prior year [18] Business Line Data and Key Metrics Changes - Advanced Energy segment revenue increased by 5.8% to $7.9 million due to increased volume of single-use handpieces and domestic sales of new generators [15] - OEM segment sales saw a significant decline of 44.7% due to decreased sales volume to existing customers [16] - Domestic revenue decreased by 3.4% year over year to $6.7 million, while international revenue decreased by 17.7% to $2.7 million [16] Market Data and Key Metrics Changes - The company noted a stabilization in demand for capital equipment in the U.S., with year-over-year increases for two consecutive quarters [5] - The growth of GLP-1 drugs is expected to drive demand for aesthetic treatments, particularly for patients experiencing loose skin due to rapid weight loss [8] Company Strategy and Development Direction - The company is focusing on the launch of the AON body contouring platform, which integrates multiple technologies into a single device [13] - Apyx Medical aims to position the AON system in the operating rooms of surgeons, enhancing its market share in aesthetic surgery [14] - The company is committed to maintaining expense control while supporting the AON launch, viewing it as a significant differentiator in the market [33] Management's Comments on Operating Environment and Future Outlook - Management acknowledged persistent macroeconomic headwinds affecting the global aesthetic space but remains optimistic about the growth potential driven by GLP-1s [7][8] - The company expects to return to more normalized cash burn for the remainder of 2025, projecting cash management will yield positive results into 2027 [19] - Revenue guidance for 2025 is set between $47.6 million and $49 million, with expectations for Advanced Energy revenue to increase [20] Other Important Information - Renuvion was awarded the 2025 New Beauty Award for Best Minimally Invasive Skin Tightener, highlighting its market position [11] - The company has implemented significant cost-cutting measures and a restructuring program to reduce cash burn and improve operational efficiency [6] Q&A Session Summary Question: Progress on AON platform and customer enrollment - Management indicated they are not ready to comment on the AON pipeline yet but noted excitement in the marketplace regarding upgrades to the APYX-ONE console [22][23] Question: Demand for APYX-ONE upgrades - Management confirmed they are seeing positive demand for upgrades to the APYX-ONE console as customers prepare for AON [24][25] Question: Tariff impacts on margins - Management stated they expect gross margins to remain around 60% for the year, indicating minimal impact from tariffs at this point [32] Question: Investments to support AON launch - Management emphasized that while controlling expenses is crucial, investments to support the AON launch will not be compromised [33]