FORT WORTH, TX, Oct. 01, 2025 (GLOBE NEWSWIRE) -- Sanara MedTech Inc. (“Sanara,” or the “Company”) (Nasdaq: SMTI), a medical technology company focused on developing and commercializing transformative technologies to improve clinical outcomes and reduce healthcare expenditures in the surgical, chronic wound and skin markets, today announced it will report its third quarter 2025 financial results on Wednesday, November 12, 2025 before the U.S. financial markets open. The Company will host a conference call a ...

Group 1 - Shares of Sanara MedTech Inc. (NASDAQ: SMTI) have experienced a significant increase following strong Q2 results [1] - The company has appointed a new CEO and is exploring strategic alternatives [1] Group 2 - The focus of the analysis is on undercovered companies, particularly in technology, software, electronics, and energy transition sectors [1] - The analyst has over 7 years of personal investment experience and emphasizes the importance of identifying asymmetric investment opportunities [1]

Summary of Sanara MedTech (SMTI) 2025 Conference Call Company Overview - **Company**: Sanara MedTech (SMTI) - **Industry**: Medical Technology, specifically in wound care and surgical products - **Key Personnel**: Newly appointed CEO Seth Young and CFO Elizabeth Taylor Core Points and Arguments - **Leadership Transition**: Seth Young has been with the company for eight years, moving through various roles before becoming CEO, effective September 15, 2025 [1][2][3] - **Company Growth**: Initially a single product company, Sanara has expanded its offerings to include a range of products from soft tissue to bone fusion and repair [6][8] - **Strong Q2 Performance**: The company reported a 25.8% growth in Q2, driven by balanced performance in both soft tissue and bone repair products, with significant contributions from anchor products BioSurge and Celerate [11][12] - **Operational Efficiency**: The company has generated cash from operations, leveraging existing sales force without significant expansion, indicating a focus on operational efficiency [14][17] - **Market Expansion**: While core markets remain in orthopedics and spine, the company is exploring opportunities in foot and ankle, plastics, and vascular spaces [20][21] - **Distributor Network**: Sanara has over 400 contracted distributors, which are crucial for expanding market reach and driving sales [22][23][35] - **Clinical Evidence**: The company emphasizes the importance of clinical data to support product efficacy, which is gathered through case studies and research [24][25] - **Strategic Review of THP**: Sanara is exploring strategic alternatives for its THP business, considering options such as partnerships or potential sale [27][28] - **Product Pipeline**: The company is excited about the upcoming launch of Ostic in 2027, a bio-adhesive product for trauma cases, which has received FDA breakthrough designation [29][30][31] Additional Important Insights - **Management Team Development**: The senior management team has been strengthened, positioning the company for future growth [17][32] - **Focus on Core Competencies**: The company aims to maintain focus and discipline in its core surgical business while exploring new growth opportunities [33][36] - **Sales Force Strategy**: The current strategy does not foresee a significant increase in internal sales staff but emphasizes the growth of the distributor network [22][35] - **Future Growth Drivers**: The company plans to leverage existing contracts and expand its reach within the 4,000 contracted facilities, currently selling into just over 1,000 [36] This summary encapsulates the key points discussed during the Sanara MedTech conference call, highlighting the company's growth trajectory, strategic initiatives, and future outlook.

Core Viewpoint - Sanara MedTech Inc. has appointed Seth Yon as President and Chief Executive Officer, effective September 15, 2025, succeeding Ron Nixon, who will remain as Executive Chairman [1][2]. Leadership Transition - The Board of Directors unanimously voted to appoint Seth Yon, highlighting his strategic leadership and proven track record over the past seven years, during which Sanara achieved a compounded annual net revenue growth of 53% over the last three fiscal years [2]. - Ron Nixon emphasized that this transition is part of a long-term initiative to strengthen the senior leadership team for future success in the market [2]. Seth Yon's Background - Seth Yon joined Sanara in March 2018 and has held various senior management roles, including Director of Sales, National Sales Director, and President of Commercial, before becoming President and Chief Commercial Officer [2][3]. - His experience includes leading the development of sales processes and metrics, contributing to significant growth in the Sanara Surgical segment [2]. Company Overview - Sanara MedTech Inc. focuses on developing and commercializing transformative medical technologies aimed at improving clinical outcomes and reducing healthcare costs in surgical, chronic wound, and skin markets [4][5]. - The company markets a range of products, including CellerateRX Surgical Activated Collagen and various advanced biologic products, primarily in the North American advanced wound care and surgical tissue repair markets [4][5].

Core Viewpoint - Sanara MedTech Inc. is set to present at the Cantor Global Healthcare Conference, highlighting its focus on developing transformative medical technologies aimed at improving clinical outcomes and reducing healthcare costs in surgical and wound care markets [1][2]. Company Overview - Sanara MedTech Inc. specializes in medical technology, particularly in surgical, chronic wound, and skin markets, with a commitment to enhancing clinical outcomes and minimizing healthcare expenditures [3]. - The company markets and distributes a range of products, including CellerateRX Surgical Activated Collagen and FORTIFY TRG Tissue Repair Graft, primarily in the North American advanced wound care and surgical tissue repair markets [3]. - Sanara's product portfolio includes advanced biologic products such as ACTIGEN™ Verified Inductive Bone Matrix and BIASURGE Advanced Surgical Solution, along with wound care products like BIAKŌS Antimicrobial Skin and Wound Cleanser [3]. - The company is actively pursuing long-term strategic partnerships to develop products that improve patient outcomes while reducing overall costs [3]. Upcoming Events - Management will participate in a fireside chat presentation at the Cantor Global Healthcare Conference on September 3, 2025, at approximately 2:45 p.m. Eastern Time [1]. - Presentation materials will be available on the company's investor relations website prior to the event, along with a live audio webcast and an archive for replay after the conference [2].

Company Performance - Sanara MedTech Inc. reported a quarterly loss of $0.23 per share, better than the Zacks Consensus Estimate of a loss of $0.33, and an improvement from a loss of $0.41 per share a year ago, representing an earnings surprise of +30.30% [1] - The company posted revenues of $25.83 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 1.70%, and showing an increase from $20.16 million in the same quarter last year [2] - Over the last four quarters, Sanara MedTech has surpassed consensus EPS estimates two times and topped consensus revenue estimates three times [2] Stock Performance - Sanara MedTech shares have declined approximately 17.3% since the beginning of the year, contrasting with the S&P 500's gain of 9.6% [3] - The current Zacks Rank for Sanara MedTech is 3 (Hold), indicating that the shares are expected to perform in line with the market in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is -$0.32 on revenues of $26.65 million, and for the current fiscal year, it is -$1.56 on revenues of $106.93 million [7] - The trend of estimate revisions for Sanara MedTech was mixed ahead of the earnings release, which could change following the recent report [6] Industry Context - The Medical - Products industry, to which Sanara MedTech belongs, is currently ranked in the bottom 40% of over 250 Zacks industries, suggesting potential challenges for stock performance [8]

[FORM 10-Q Cover Page](index=1&type=section&id=FORM%2010-Q%20Cover%20Page) [Registrant Information](index=1&type=section&id=Registrant%20Information) This section provides the basic identification details for Sanara MedTech Inc.'s quarterly report, including the filing period, state of incorporation, and contact information - Registrant: **SANARA MEDTECH INC.**[2](index=2&type=chunk) - Quarterly Period Ended: **June 30, 2025**[2](index=2&type=chunk) [Securities Information](index=1&type=section&id=Securities%20Information) Details regarding the company's registered securities, including the trading symbol and exchange, are provided | Title of each class | Trading Symbol(s) | Name of each exchange on which registered | | :------------------ | :---------------- | :---------------------------------------- | | Common Stock, $0.001 par value | SMTI | The Nasdaq Capital Market | [Filer Status and Shares Outstanding](index=1&type=section&id=Filer%20Status%20and%20Shares%20Outstanding) The company confirms its compliance with SEC filing requirements and discloses its filer status and the number of common shares issued and outstanding as of a recent date - The registrant has filed all required reports during the preceding 12 months and has been subject to filing requirements for the past 90 days[4](index=4&type=chunk) | Large accelerated filer | Accelerated filer | Non-accelerated filer | Smaller reporting company | Emerging growth company | | :---------------------- | :---------------- | :-------------------- | :------------------------ | :---------------------- | | ☐ | ☐ | ☒ | ☒ | ☐ | - As of August 12, 2025, **8,902,351 shares** of the Issuer's common stock, $0.001 par value per share, were issued and outstanding[5](index=5&type=chunk) [Table of Contents](index=3&type=section&id=Table%20of%20Contents) [Part I – Financial Information](index=4&type=section&id=Part%20I%20%E2%80%93%20Financial%20Information) [ITEM 1. FINANCIAL STATEMENTS](index=4&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS) This section presents Sanara MedTech Inc.'s unaudited consolidated financial statements, including the balance sheets, statements of operations, changes in shareholders' equity, and cash flows for the periods ended June 30, 2025, along with detailed notes explaining significant accounting policies, recent acquisitions, debt, equity, and segment reporting [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) | Metric | June 30, 2025 (Unaudited) | December 31, 2024 | | :----------------------------- | :------------------------ | :------------------ | | Total Assets | $98,767,645 | $88,091,992 | | Total Liabilities | $63,375,699 | $49,180,030 | | Total Shareholders' Equity | $35,391,946 | $38,911,962 | [Consolidated Statements of Operations](index=6&type=section&id=Consolidated%20Statements%20of%20Operations) | Metric | 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 Revenue | $25,830,834 | $20,158,823 | $49,264,930 | $38,695,461 | | Gross Profit | $23,893,552 | $18,150,137 | $45,492,681 | $34,796,729 | | Operating Loss | $(31,348) | $(2,884,856) | $(2,111,377) | $(4,416,563) | | Net Loss Attributable to Shareholders | $(2,014,362) | $(3,504,014) | $(5,541,539) | $(5,268,198) | | Net Loss Per Share (Basic & Diluted) | $(0.23) | $(0.41) | $(0.64) | $(0.62) | [Consolidated Statements of Changes in Shareholders' Equity](index=7&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Shareholders%27%20Equity) | Metric | Balance at December 31, 2024 | Balance at June 30, 2025 | | :----------------------------------- | :--------------------------- | :----------------------- | | Common Stock (Shares) | 8,753,773 | 8,903,662 | | Common Stock (Amount) | $8,754 | $8,904 | | Additional Paid-In Capital | $77,179,211 | $78,678,081 | | Accumulated Deficit | $(37,784,392) | $(43,287,572) | | Total Shareholders' Equity | $38,911,962 | $35,391,946 | [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) | Cash Flow Activity (Six Months Ended June 30) | 2025 | 2024 | | :-------------------------------------------- | :----------- | :----------- | | Net Cash Provided by (Used in) Operating Activities | $665,127 | $(3,006,300) | | Net Cash Used in Investing Activities | $(9,107,823) | $(124,580) | | Net Cash Provided by Financing Activities | $9,523,145 | $4,134,039 | | Net Increase in Cash | $1,080,449 | $1,003,159 | | Cash, End of Period | $16,958,744 | $6,150,375 | [Notes to Unaudited Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Unaudited%20Consolidated%20Financial%20Statements) This section provides detailed disclosures and explanations for the unaudited consolidated financial statements, covering the company's business segments, significant accounting policies, recent acquisitions, equity investments, debt obligations, and related party transactions [NOTE 1 – NATURE OF BUSINESS AND BACKGROUND](index=9&type=section&id=NOTE%201%20%E2%80%93%20NATURE%20OF%20BUSINESS%20AND%20BACKGROUND) Sanara MedTech Inc. is a medical technology company focused on surgical, chronic wound, and skin markets, operating through two reportable segments: Sanara Surgical and Tissue Health Plus (THP), with a strategic shift in 2024 to reflect the growing importance of value-based wound care - Sanara MedTech Inc. is a medical technology company focused on developing and commercializing transformative technologies in surgical, chronic wound, and skin markets[20](index=20&type=chunk) - The Company operates through two reportable segments: Sanara Surgical and Tissue Health Plus (THP), a change implemented in Q2 2024 to reflect the growing investment in value-based wound care strategy[21](index=21&type=chunk)[22](index=22&type=chunk) - Sanara Surgical markets soft tissue repair (e.g., CellerateRX Surgical, BIASURGE) and bone fusion products (e.g., BiFORM, ALLOCYTE Plus) for sterile environments, and includes an in-house R&D team[23](index=23&type=chunk)[24](index=24&type=chunk) - THP aims to simplify skin health, starting with wound care, by offering a value-based wound care program to payers and risk-bearing entities, coordinating community and home-based care, and launched its first pilot program in Q2 2025[25](index=25&type=chunk)[26](index=26&type=chunk) [NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES](index=10&type=section&id=NOTE%202%20%E2%80%93%20SUMMARY%20OF%20SIGNIFICANT%20ACCOUNTING%20POLICIES) This note outlines the company's key accounting principles, including consolidation, use of estimates, revenue recognition, and policies for assets like accounts receivable, inventory, property, goodwill, and intangibles, as well as equity investments, fair value measurements, and recently adopted and issued accounting pronouncements - The company's unaudited consolidated financial statements include Sanara MedTech Inc. and its wholly-owned and majority-owned subsidiaries, with all significant intercompany transactions eliminated[27](index=27&type=chunk) - Revenue is recognized when control of promised goods or services is transferred to the customer, primarily from product sales (soft tissue repair, bone fusion), with SaaS revenue starting in Q2 2025 from the THP segment[33](index=33&type=chunk)[38](index=38&type=chunk)[40](index=40&type=chunk) | Revenue Stream (Three Months Ended June 30) | 2025 | 2024 | | :------------------------------------------ | :----------- | :----------- | | Soft tissue repair products | $22,661,457 | $17,641,318 | | Bone fusion products | $3,142,795 | $2,516,599 | | SaaS | $26,582 | $- | | Royalties | $- | $906 | | **Total Net Revenue** | **$25,830,834** | **$20,158,823** | - The company capitalizes costs for internal use software during the application development stage, particularly for the THP platform, with approximately **$3.4 million capitalized** as of June 30, 2025, to be depreciated over five years once placed in service[44](index=44&type=chunk)[46](index=46&type=chunk) - Goodwill, primarily from the Scendia acquisition within the Sanara Surgical segment, is tested annually for impairment and was not impaired as of June 30, 2025 or 2024[47](index=47&type=chunk)[80](index=80&type=chunk) | Intangible Assets (June 30, 2025) | Cost | Accumulated Amortization | Net | | :-------------------------------- | :----------- | :----------------------- | :----------- | | Patents and Other IP | $38,056,240 | $(6,171,366) | $31,884,874 | | Customer relationships and other | $7,971,752 | $(3,594,886) | $4,376,866 | | Licenses | $6,784,278 | $(2,053,450) | $4,730,828 | | **Total** | **$52,812,270** | **$(11,819,702)** | **$40,992,568** | - The company adopted ASU 2023-07 (Segment Reporting) effective for its annual report for FY2024 and interim filings beginning Q1 2025, which did not materially impact its financial position, results, or cash flows[66](index=66&type=chunk) [NOTE 3 – CAREPICS ACQUISITION](index=18&type=section&id=NOTE%203%20%E2%80%93%20CAREPICS%20ACQUISITION) On April 1, 2025, Sanara MedTech acquired CarePICS, LLC, a mobile and web app platform for vascular and wound care clinicians, for $2.0 million cash consideration plus $1.65 million to satisfy existing debt, and potential earnout payments up to $20 million, with the acquisition accounted for as an asset acquisition - On April 1, 2025, Sanara MedTech acquired CarePICS, LLC, a mobile and web app platform for clinicians treating vascular and wound care patients, which will be utilized in the THP platform[69](index=69&type=chunk)[70](index=70&type=chunk) | CarePICS Acquisition Consideration | Amount | | :------------------------------- | :----------- | | Cash consideration | $2,000,000 | | Contingent consideration | $1,355,603 | | Direct transaction costs | $122,146 | | **Total purchase consideration** | **$3,477,749** | - The acquisition included potential earnout payments up to **$10 million** for the first two earnout periods (ending March 31, 2027) based on SaaS P&L EBITDA, and up to an additional **$10 million** over 10 years based on patient volume, payable in cash or Class A-2/B Units[72](index=72&type=chunk)[73](index=73&type=chunk)[74](index=74&type=chunk) - The CarePICS Acquisition was accounted for as an asset acquisition, with the purchase consideration primarily allocated to developed technology (**$5,127,749**) and assumed debt (**$(1,650,000)**)[76](index=76&type=chunk)[77](index=77&type=chunk) [NOTE 4 – CONVERTIBLE LOAN RECEIVABLE](index=19&type=section&id=NOTE%204%20%E2%80%93%20CONVERTIBLE%20LOAN%20RECEIVABLE) The company's $1.0 million convertible loan to Biomimetic Innovations Limited (BMI), including accrued interest, was converted into equity of BMI on January 16, 2025, resulting in a zero loan balance as of June 30, 2025 - A **$1,079,391** convertible loan to Biomimetic Innovations Limited (BMI), including accrued interest, was converted into equity of BMI on January 16, 2025[78](index=78&type=chunk) - The convertible loan receivable balance was **$0** as of June 30, 2025, down from **$1,101,478** as of December 31, 2024[78](index=78&type=chunk) [NOTE 5 – GOODWILL AND INTANGIBLES, NET](index=20&type=section&id=NOTE%205%20%E2%80%93%20GOODWILL%20AND%20INTANGIBLES%2C%20NET) Goodwill remained stable at $3.6 million, entirely within the Sanara Surgical segment, with no impairment recorded. Total net intangible assets were $41.0 million as of June 30, 2025, slightly down from $41.0 million at December 31, 2024, with a weighted-average amortization period of 14.2 years | Metric | December 31, 2023 | December 31, 2024 | June 30, 2025 | | :----- | :------------------ | :------------------ | :------------ | | Goodwill | $3,601,781 | $3,601,781 | $3,601,781 | - Goodwill is entirely within the Sanara Surgical segment and was not impaired as of June 30, 2025 or 2024[80](index=80&type=chunk) | Intangible Assets (Net) | June 30, 2025 | December 31, 2024 | | :---------------------- | :------------ | :---------------- | | Patents and Other IP | $31,884,874 | $33,000,384 | | Customer relationships and other | $4,376,866 | $4,941,181 | | Licenses | $4,730,828 | $3,065,211 | | **Total Net Intangible Assets** | **$40,992,568** | **$41,006,776** | - The weighted-average amortization period for finite-lived intangible assets was **14.2 years** as of June 30, 2025[81](index=81&type=chunk) [NOTE 6 – INVESTMENTS IN EQUITY SECURITIES](index=21&type=section&id=NOTE%206%20%E2%80%93%20INVESTMENTS%20IN%20EQUITY%20SECURITIES) The company holds nonmarketable equity investments in privately held companies, including DirectDerm (cost method), and ChemoMouthpiece, SI Technologies, and BMI (equity method), with significant changes including the Pixalere Redemption in January 2025 converting an investment into an intangible asset and increased ownership in BMI to 9.678% by July 1, 2025 - The company's equity investments include nonmarketable securities in privately held companies, reported at cost or using the equity method based on influence[82](index=82&type=chunk) - In January 2025, the Pixalere investment was reclassified from a cost method investment (**$2,084,278**) to an intangible asset for an amended license agreement, and Pixalere Canada's equity in Pixalere USA was redeemed[85](index=85&type=chunk)[86](index=86&type=chunk)[96](index=96&type=chunk) - The company uses the equity method for investments in ChemoMouthpiece (**6.59% ownership**), SI Healthcare Technologies (**50% ownership**), and Biomimetic Innovations Limited (BMI), where its ownership increased to approximately **9.678%** by July 1, 2025, following additional capital contributions[88](index=88&type=chunk)[92](index=92&type=chunk)[93](index=93&type=chunk)[94](index=94&type=chunk) | Investment (June 30, 2025) | Carrying Amount | Economic Interest | | :------------------------- | :-------------- | :---------------- | | ChemoMouthpiece, LLC | $5,017,758 | 6.59% | | SI Healthcare Technologies, LLC | $47,976 | 50.00% | | Biomimetic Innovations Limited | $4,450,078 | 6.67% | | Direct Dermatology Inc. | $1,000,000 | ~8.1% (as of Dec 31, 2024) | | **Total Investments** | **$10,515,812** | | | Share of Losses from Equity Method Investments (Six Months Ended June 30) | 2025 | 2024 | | :-------------------------------------------------------------------- | :----------- | :----------- | | ChemoMouthpiece, LLC | $(154,484) | $- | | SI Healthcare Technologies, LLC | $7,273 | $- | | Biomimetic Innovations Limited | $(191,879) | $- | | **Total** | **$(339,090)** | **$-** | [NOTE 7 – OPERATING LEASES](index=24&type=section&id=NOTE%207%20%E2%80%93%20OPERATING%20LEASES) The company holds two material operating leases for office space, with ROU assets of $1.09 million and related lease liabilities of $1.23 million as of June 30, 2025, and a weighted average remaining lease term of 5.6 years - As of June 30, 2025, the company had two material operating leases for office space, with one renewed for an additional three-year term in August 2025[98](index=98&type=chunk) | Operating Lease Metrics (June 30, 2025) | Amount | | :------------------------------------ | :----------- | | Right of Use Assets | $1,088,149 | | Lease Liabilities | $1,234,225 | | Weighted Average Remaining Lease Term | 5.6 years | | Weighted Average Discount Rate | 13.2% | | Operating Lease Expense (Six Months Ended June 30) | 2025 | 2024 | | :------------------------------------------------- | :----------- | :----------- | | Lease Expense | $260,197 | $277,596 | | Cash Paid for Operating Lease Liabilities | $259,786 | $267,223 | [NOTE 8 – DEBT AND CREDIT FACILITIES](index=25&type=section&id=NOTE%208%20%E2%80%93%20DEBT%20AND%20CREDIT%20FACILITIES) The company's CRG Term Loan facility provides up to $55.0 million, with $42.75 million drawn as of June 30, 2025, and $12.25 million remaining available. The loan bears 13.25% interest (8% cash, 5.25% PIK) and matures in May 2029, with the company in compliance with all debt covenants - The company has a CRG Term Loan facility for up to **$55.0 million**, with **$42.75 million** principal outstanding as of June 30, 2025, and **$12.25 million** available for future borrowing[102](index=102&type=chunk)[103](index=103&type=chunk)[105](index=105&type=chunk)[112](index=112&type=chunk)[225](index=225&type=chunk) - The CRG Term Loan bears interest at **13.25%** per annum (**8.00% cash, 5.25% paid-in-kind**) and has a maturity date of **May 30, 2029**[106](index=106&type=chunk)[105](index=105&type=chunk) | Debt Components (June 30, 2025) | Amount | | :------------------------------ | :----------- | | CRG Term Loan (Principal) | $42,750,000 | | Paid-in-kind interest | $1,834,210 | | Back-end fee | $735,576 | | Less: Unamortized debt issuance costs | $(1,103,124) | | **Long-term debt, net** | **$44,216,662** | - The company was in compliance with all debt covenants as of June 30, 2025, including maintaining liquidity above **$3.0 million** and meeting annual minimum revenue targets (e.g., **$75.0 million** for FY2025)[113](index=113&type=chunk)[230](index=230&type=chunk) [NOTE 9 - COMMITMENTS AND CONTINGENCIES](index=27&type=section&id=NOTE%209%20-%20COMMITMENTS%20AND%20CONTINGENCIES) This note details various license agreements for antimicrobial products (BIAKŌS, ABF, Debrider) with Rochal, including royalty commitments, and the BMI License Agreement for trauma products with associated royalties and milestone payments. It also covers earnout liabilities from the Precision Healing merger and Applied Asset Purchase, and a new license agreement with Tufts University for collagen peptides - The company has exclusive worldwide license agreements with Rochal for antimicrobial products (BIAKŌS, BIASURGE, CuraShield) and a debrider, with royalty payments ranging from **2-4% of net sales** and minimum annual royalties[115](index=115&type=chunk)[116](index=116&type=chunk)[118](index=118&type=chunk)[120](index=120&type=chunk)[121](index=121&type=chunk)[122](index=122&type=chunk) | Royalty Expense (Six Months Ended June 30) | 2025 | 2024 | | :----------------------------------------- | :----------- | :----------- | | BIAKŌS License Agreement | $85,435 | $77,305 | - The BMI License Agreement grants exclusive U.S. marketing and distribution rights for OsStic and ARC trauma products, requiring **3% royalties** on OsStic net sales and annual minimum royalties starting at **$100,000** after regulatory approval[123](index=123&type=chunk)[126](index=126&type=chunk)[127](index=127&type=chunk) - The Applied Asset Purchase includes an earnout of up to **$10.0 million** based on net sales of a collagen-based product, with installment payments of **$625,000** made in August 2024 and August 2025[131](index=131&type=chunk)[132](index=132&type=chunk) - A license agreement with Tufts University for 18 unique collagen peptides involves a new subsidiary (SCP) and royalties of **1.5% or 3%** on net sales, with minimum annual royalties starting at **$50,000**[135](index=135&type=chunk) [NOTE 10 – SHAREHOLDERS' EQUITY](index=31&type=section&id=NOTE%2010%20%E2%80%93%20SHAREHOLDERS%27%20EQUITY) The company's 2014 LTIP terminated in September 2024, replaced by the 2024 LTIP which authorized 1,000,000 shares for awards. During the six months ended June 30, 2025, 170,842 restricted stock awards were issued, resulting in $2.74 million in share-based compensation expense, with $7.35 million unrecognized - The 2014 Omnibus Long Term Incentive Plan (LTIP) terminated on September 3, 2024, with no future awards. The 2024 LTIP was approved, authorizing **1,000,000 shares** for awards[137](index=137&type=chunk)[138](index=138&type=chunk) - During the six months ended June 30, 2025, **170,842 restricted stock awards** (net of forfeitures) were issued under the 2024 LTIP, with a fair value of **$5,825,941**[139](index=139&type=chunk) | Share-based Compensation Expense (Six Months Ended June 30) | 2025 | 2024 | | :-------------------------------------------------------- | :----------- | :----------- | | Total Share-based Compensation Expense | $2,740,343 | $2,214,931 | - As of June 30, 2025, there was **$7,350,817** of total unrecognized share-based compensation expense, expected to be recognized over a weighted-average period of **1.4 years**[141](index=141&type=chunk) | Stock Options (June 30, 2025) | Options | Weighted Average Exercise Price | Weighted Average Remaining Contract Life | Aggregate Intrinsic Value | | :---------------------------- | :-------- | :------------------------------ | :--------------------------------------- | :------------------------ | | Outstanding | 31,013 | $10.57 | 5.3 years | $552,803 | | Exercisable | 31,013 | $10.57 | 5.3 years | $552,803 | [NOTE 11 – RELATED PARTIES](index=32&type=section&id=NOTE%2011%20%E2%80%93%20RELATED%20PARTIES) The company has ongoing product license agreements with Rochal Industries, a related party, for antimicrobial and debrider products, and a consulting agreement with Ann Beal Salamone (a director of both companies). It also has a transaction advisory services agreement with Catalyst, another related party, for which it incurred $30,000 in costs during the six months ended June 30, 2025 - The company has exclusive product license agreements with Rochal Industries, a related party, for antimicrobial products (BIAKŌS, BIASURGE, CuraShield) and a debrider[144](index=144&type=chunk)[145](index=145&type=chunk)[146](index=146&type=chunk) - Ann Beal Salamone, a director of the company and a significant shareholder/Chair of Rochal, has a consulting agreement with the company for an annual fee of **$177,697**[148](index=148&type=chunk) - The company incurred **$30,000** in costs during the six months ended June 30, 2025, under a Transaction Advisory Services Agreement with Catalyst, a related party, for various advisory and corporate development services[149](index=149&type=chunk)[150](index=150&type=chunk) | Related Party Balances | June 30, 2025 | December 31, 2024 | | :--------------------- | :------------ | :---------------- | | Accounts receivable – related parties | $9,081 | $40,566 | | Accounts payable – related parties | $32,355 | $30,913 | [NOTE 12 – SEGMENT REPORTING](index=34&type=section&id=NOTE%2012%20%E2%80%93%20SEGMENT%20REPORTING) The company reports two segments: Sanara Surgical (soft tissue repair and bone fusion products) and Tissue Health Plus (THP) (value-based wound care services), a change implemented in Q2 2024. Segment Adjusted EBITDA is the primary profitability measure, with THP showing a significant net loss and negative Segment Adjusted EBITDA due to buildout costs - The company changed its reportable segments in Q2 2024 to Sanara Surgical and Tissue Health Plus (THP), reflecting the growing importance of value-based wound care[152](index=152&type=chunk)[159](index=159&type=chunk) - Sanara Surgical focuses on soft tissue repair and bone fusion products, while THP is dedicated to value-based wound care services, aiming to reduce hospitalizations and improve patient quality of life[154](index=154&type=chunk)[156](index=156&type=chunk)[157](index=157&type=chunk) - Segment Adjusted EBITDA is the primary profitability measure used by the CEO (CODM) for assessing financial performance and resource allocation[153](index=153&type=chunk) | Segment Adjusted EBITDA (Six Months Ended June 30) | 2025 | 2024 | | :------------------------------------------------- | :----------- | :----------- | | Sanara Surgical | $7,414,885 | $2,532,145 | | THP | $(4,092,077) | $(1,628,543) | | **Total Segment Adjusted EBITDA** | **$3,322,808** | **$903,602** | - THP segment does not include **$3.4 million** of internal use software costs capitalized during the six months ended June 30, 2025, which are part of its buildout[163](index=163&type=chunk) [ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](index=37&type=section&id=ITEM%202.%20MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) This section provides management's perspective on the company's financial condition and operational results for the quarter ended June 30, 2025, highlighting revenue growth, segment performance, recent strategic developments, and liquidity, while also discussing forward-looking statements and key accounting estimates [CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS](index=37&type=section&id=CAUTIONARY%20STATEMENT%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) This section warns readers that the report contains forward-looking statements about future events and financial performance, which are subject to various risks and uncertainties that could cause actual results to differ materially from projections - The report contains forward-looking statements regarding future events or financial/operating performance, including value-based wound and skin services and THP platforms[165](index=165&type=chunk) - These statements are subject to risks and uncertainties, such as shortfalls in revenue growth, ability to implement strategies, capital requirements, debt compliance, product development, market acceptance, competition, and regulatory changes[165](index=165&type=chunk)[171](index=171&type=chunk) [OVERVIEW](index=38&type=section&id=OVERVIEW) Sanara MedTech is a medical technology company focused on surgical, chronic wound, and skin markets, operating through two segments: Sanara Surgical (products for sterile environments) and Tissue Health Plus (THP) (value-based wound care services). The company aims to expand its offerings and has initiated a formal process to evaluate strategic alternatives for THP - Sanara MedTech is a medical technology company focused on developing and commercializing transformative technologies to improve clinical outcomes and reduce healthcare expenditures in surgical, chronic wound, and skin markets[167](index=167&type=chunk) - The company operates through two reportable segments, Sanara Surgical and THP, a change implemented in Q2 2024 due to the growing importance of the value-based wound care program[168](index=168&type=chunk) - Sanara Surgical markets soft tissue repair (e.g., CellerateRX Surgical, BIASURGE) and bone fusion products (e.g., BiFORM, ALLOCYTE Plus) and includes an in-house R&D team[169](index=169&type=chunk)[170](index=170&type=chunk) - THP focuses on value-based wound care services, planning to offer programs to payers and risk-bearing entities to divest wound care spend risk, reduce hospitalizations, and improve patient quality of life[172](index=172&type=chunk)[173](index=173&type=chunk) - THP's comprehensive approach includes a Care Hub for virtual patient monitoring, a Managed Services Organization (MSO) Network of third-party providers, and a Technology Platform leveraging AI/ML for workflow automation and integration[183](index=183&type=chunk)[184](index=184&type=chunk) - The company has initiated a formal process to evaluate a full range of strategic alternatives for THP to maximize shareholder value[184](index=184&type=chunk) [RECENT DEVELOPMENTS](index=41&type=section&id=RECENT%20DEVELOPMENTS) Recent developments include the CRG Term Loan amendment, allowing additional borrowings up to $12.25 million by December 31, 2025, and the third borrowing of $12.25 million used for acquisitions and working capital. The company also made an initial €3.0 million cash investment in BMI, converted a €1.0 million loan to equity, and acquired CarePICS for $2.0 million cash plus $1.65 million debt satisfaction and potential earnouts - The CRG Term Loan Agreement was amended to allow up to two additional borrowings, with a third borrowing of **$12.25 million** made on March 31, 2025, for acquisitions (like CarePICS) and working capital. An additional **$12.25 million** can be drawn by December 31, 2025[187](index=187&type=chunk) - The company made an initial **€3.0 million** cash investment in Biomimetic Innovation Limited (BMI) and converted a **€1.0 million** convertible loan into BMI equity, resulting in approximately **6.67% ownership**, increasing to **9.678%** by July 1, 2025, after additional milestone payments[189](index=189&type=chunk) - On April 1, 2025, the company acquired CarePICS, LLC for **$2.0 million cash**, paid **$1.65 million** to satisfy existing debt, and agreed to potential earnout payments[190](index=190&type=chunk) [COMPONENTS OF RESULTS OF OPERATIONS](index=42&type=section&id=COMPONENTS%20OF%20RESULTS%20OF%20OPERATIONS) The company's revenue primarily comes from sales of soft tissue repair and bone fusion products, with SaaS revenue from the THP segment starting in Q2 2025. Cost of goods sold includes acquisition costs and royalties, while operating expenses comprise SG&A, R&D (expected to increase), depreciation and amortization, and changes in earnout liabilities - Revenue is primarily derived from sales of soft tissue repair and bone fusion products to hospitals and acute care facilities, with CellerateRX Surgical being the substantial majority[191](index=191&type=chunk) | Revenue Stream (Six Months Ended June 30) | 2025 | 2024 | | :------------------------------------------ | :----------- | :----------- | | Soft tissue repair products | $43,193,897 | $33,723,610 | | Bone fusion products | $6,044,451 | $4,970,945 | | SaaS | $26,582 | $- | | Royalties | $- | $906 | | **Total Net Revenue** | **$49,264,930** | **$38,695,461** | - Cost of goods sold includes acquisition costs from manufacturers, raw material costs, and royalties. Operating expenses include SG&A, R&D (expected to increase), depreciation and amortization, and changes in fair value of earnout liabilities[195](index=195&type=chunk)[196](index=196&type=chunk)[197](index=197&type=chunk)[198](index=198&type=chunk) [RESULTS OF OPERATIONS](index=44&type=section&id=RESULTS%20OF%20OPERATIONS) For the six months ended June 30, 2025, net revenue increased by 27% to $49.3 million, driven by higher sales of soft tissue repair and bone fusion products. Gross profit rose 31% to $45.5 million, while SG&A and R&D expenses also increased, leading to a net loss of $5.5 million. Segment Adjusted EBITDA improved to $3.3 million, despite a significant negative contribution from the THP segment due to platform buildout costs | Financial Metric (Six Months Ended June 30) | 2025 | 2024 | Change (%) | | :------------------------------------------ | :----------- | :----------- | :--------- | | Net Revenue | $49,264,930 | $38,695,461 | 27% | | Gross Profit | $45,492,681 | $34,796,729 | 31% | | Selling, General and Administrative | $42,993,804 | $35,149,867 | 22% | | Research and Development | $2,371,613 | $1,931,949 | 23% | | Net Loss | $(5,545,781) | $(5,328,245) | 4% | | Segment Adjusted EBITDA | $3,322,808 | $903,602 | 268% | - Net revenue increase was primarily due to increased sales of soft tissue repair products (CellerateRX Surgical, BIASURGE) and bone fusion products, driven by increased market penetration and geographic expansion[202](index=202&type=chunk) - Higher gross margins were realized due to increased sales of soft tissue repair products and lower manufacturing costs for CellerateRX Surgical[203](index=203&type=chunk)[204](index=204&type=chunk) - SG&A increased due to higher direct sales and marketing expenses (**$3.7 million**) and additional SG&A in the THP segment (**$3.1 million**). R&D increased, with **$3.4 million** capitalized for the THP technology platform buildout[205](index=205&type=chunk)[206](index=206&type=chunk) - The net loss for the six months ended June 30, 2025, included **$5.4 million** related to the THP segment, primarily due to buildout costs and increased interest expense[210](index=210&type=chunk) - Segment Adjusted EBITDA for THP was **$(4.1) million** for the six months ended June 30, 2025, reflecting higher costs related to its platform buildout[216](index=216&type=chunk) [LIQUIDITY AND CAPITAL RESOURCES](index=47&type=section&id=LIQUIDITY%20AND%20CAPITAL%20RESOURCES) Cash on hand was $17.0 million at June 30, 2025. The company expects to invest $5.5-$6.5 million in THP during H2 2025 and anticipates sufficient liquidity for the next 12 months from cash, operations, and $12.25 million available under the CRG Term Loan. Recent financing activities include the CRG Term Loan amendment and third borrowing, the BMI investment, and the CarePICS acquisition | Cash and Liquidity | June 30, 2025 | December 31, 2024 | | :----------------- | :------------ | :---------------- | | Cash on hand | $16,958,744 | $15,878,295 | | Available CRG Term Loan | $12,250,000 | (Not applicable) | - The company expects to invest between **$5.5 million** and **$6.5 million** in the THP strategy during the second half of 2025, with no material cash investments anticipated after year-end[217](index=217&type=chunk) - The CRG Term Loan Agreement was amended, and a third borrowing of **$12.25 million** was made, with **$12.25 million** still available for future borrowing until December 31, 2025[223](index=223&type=chunk)[224](index=224&type=chunk) - The company made an initial **€3.0 million** cash investment in BMI and converted a **€1.0 million** loan to equity, with additional **€4.0 million** committed upon milestones[234](index=234&type=chunk) - The CarePICS Acquisition involved **$2.0 million** cash consideration and **$1.65 million** to satisfy existing debt, plus potential earnout payments[235](index=235&type=chunk) - Net cash provided by operating activities was **$0.7 million** for the six months ended June 30, 2025, an increase from **$3.0 million used** in the prior year, due to revenue growth and improved receivables collection[240](index=240&type=chunk) - Net cash used in investing activities was **$9.1 million**, primarily for the CarePICS acquisition (**$2.1 million**), BMI investment (**$3.5 million**), and THP technology platform capitalization (**$3.4 million**)[241](index=241&type=chunk) - Net cash provided by financing activities was **$9.5 million**, mainly from CRG Term Loan proceeds, partially offset by CarePICS debt payoff[242](index=242&type=chunk) [MATERIAL TRANSACTIONS WITH RELATED PARTIES](index=52&type=section&id=MATERIAL%20TRANSACTIONS%20WITH%20RELATED%20PARTIES) The company has a consulting agreement with Ann Beal Salamone (a director and significant shareholder of Rochal) for an annual fee of $177,697, and a Transaction Advisory Services Agreement with Catalyst, a related party, incurring $30,000 in costs during the six months ended June 30, 2025 - Ann Beal Salamone, a director of the company and a significant shareholder/Chair of Rochal, has a consulting agreement for **$177,697 annually**, renewed for successive one-year terms[243](index=243&type=chunk) - The company incurred **$30,000** in costs during the six months ended June 30, 2025, under a Transaction Advisory Services Agreement with Catalyst, a related party, for advisory and corporate development services[244](index=244&type=chunk)[245](index=245&type=chunk) | Related Party Balances | June 30, 2025 | December 31, 2024 | | :--------------------- | :------------ | :---------------- | | Accounts receivable – related parties | $9,081 | $40,566 | | Accounts payable – related parties | $32,355 | $30,913 | [IMPACT OF INFLATION AND CHANGING PRICES](index=53&type=section&id=IMPACT%20OF%20INFLATION%20AND%20CHANGING%20PRICES) Inflation and changing prices have not had a material impact on the company's historical results of operations and are not anticipated to have a material impact in the future - Inflation and changing prices have not materially impacted historical results and are not anticipated to materially impact future results[247](index=247&type=chunk) [CRITICAL ACCOUNTING ESTIMATES](index=53&type=section&id=CRITICAL%20ACCOUNTING%20ESTIMATES) The company's critical accounting estimates, including revenue and expense accruals, fair value measurements, and purchase price allocation, have not significantly changed since December 31, 2024 - Critical accounting estimates, such as revenue and expense accruals, fair value measurement of assets and liabilities, and purchase price allocation, have not significantly changed since December 31, 2024[248](index=248&type=chunk) [ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](index=53&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) As a smaller reporting company, Sanara MedTech Inc. is not required to provide quantitative and qualitative disclosures about market risk - As a smaller reporting company, Sanara MedTech Inc. is not required to provide quantitative and qualitative disclosures about market risk[249](index=249&type=chunk) [ITEM 4. CONTROLS AND PROCEDURES](index=53&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) The company's disclosure controls and procedures were evaluated as effective as of June 30, 2025, and there were no material changes in internal control over financial reporting during the quarter - The company's disclosure controls and procedures were evaluated as effective as of June 30, 2025[250](index=250&type=chunk) - There were no material changes in internal control over financial reporting during the quarter ended June 30, 2025[251](index=251&type=chunk) [Part II – Other Information](index=55&type=section&id=Part%20II%20%E2%80%93%20Other%20Information) [ITEM 1. LEGAL PROCEEDINGS](index=55&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) The company is not aware of any material pending legal proceedings - To the company's knowledge, there are no material pending legal proceedings to which it is a party or of which any of its property is the subject[253](index=253&type=chunk) [ITEM 1A. RISK FACTORS](index=55&type=section&id=ITEM%201A.%20RISK%20FACTORS) There were no material changes to the risk factors previously disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024 - No material changes to the risk factors disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024[254](index=254&type=chunk) [ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS](index=55&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) There were no unregistered sales of equity securities during the quarter. The company repurchased 20,755 shares of common stock in April and May 2025, primarily for tax withholding obligations related to restricted stock vesting - No sales of unregistered securities were reported during the quarter ended June 30, 2025[255](index=255&type=chunk) | Period | Total Number of Shares Purchased | Average Price Paid per Share | | :----------------------- | :----------------------------- | :--------------------------- | | April 1 - April 30, 2025 | 15,826 | $33.85 | | May 1 - May 31, 2025 | 4,929 | $30.88 | | June 1 - June 30, 2025 | - | $- | | **Total** | **20,755** | | - Shares purchased were transferred from employees to satisfy tax withholding obligations associated with the vesting of restricted stock awards[256](index=256&type=chunk) [ITEM 3. DEFAULTS UPON SENIOR SECURITIES](index=55&type=section&id=ITEM%203.%20DEFAULTS%20UPON%20SENIOR%20SECURITIES) There were no defaults upon senior securities - No defaults upon senior securities[257](index=257&type=chunk) [ITEM 4. MINE SAFETY DISCLOSURES](index=55&type=section&id=ITEM%204.%20MINE%20SAFETY%20DISCLOSURES) This item is not applicable to the company - This item is not applicable to the company[258](index=258&type=chunk) [ITEM 5. OTHER INFORMATION](index=55&type=section&id=ITEM%205.%20OTHER%20INFORMATION) No director or officer adopted, modified, or terminated any Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement during the three months ended June 30, 2025 - No director or officer adopted, modified, or terminated any "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement" during the three months ended June 30, 2025[259](index=259&type=chunk) [ITEM 6. EXHIBITS](index=56&type=section&id=ITEM%206.%20EXHIBITS) This section lists all exhibits filed as part of the report, including various agreements (asset purchase, merger, unit purchase), organizational documents, and certifications - The exhibits include various agreements such as the Asset Purchase Agreement (Rochal, Applied), Agreement and Plan of Merger (Precision Healing), Membership Interest Purchase Agreement (Scendia Biologics), and Unit Purchase Agreement (CarePICS)[261](index=261&type=chunk) - Organizational documents like the Amended and Restated Certificate of Formation and Bylaws are also filed[261](index=261&type=chunk) - Certifications from the Principal Executive Officer and Principal Financial Officer are included, as required by the Sarbanes-Oxley Act[261](index=261&type=chunk) [SIGNATURES](index=58&type=section&id=SIGNATURES) [Report Signature](index=58&type=section&id=Report%20Signature) The report is signed on behalf of Sanara MedTech Inc. by Elizabeth B. Taylor, Chief Financial Officer, on August 13, 2025 - The report was signed by Elizabeth B. Taylor, Chief Financial Officer, on August 13, 2025[266](index=266&type=chunk)

Financial Data and Key Metrics Changes - The company reported net revenue of $25.8 million for the second quarter, representing a 28% year-over-year growth [5] - Gross profit increased by $5.7 million or 32% to $23.9 million, with gross margin rising approximately 250 basis points to 93% of net revenue [29] - The net loss for the second quarter was $2 million or $0.23 per diluted share, compared to a net loss of $3.5 million or $0.42 per diluted share in the previous year [31] - Adjusted EBITDA for the second quarter was $2.7 million, an increase of $2.1 million or 350% year-over-year [33] Business Line Data and Key Metrics Changes - The Surgical segment generated net revenue of $25.8 million, with soft tissue product sales increasing 28% year-over-year to $22.7 million [5][6] - Bone Fusion products saw a 25% year-over-year increase in sales to $3.1 million [6] - The Surgical segment achieved a net income of approximately $500,000, an improvement of $2.7 million year-over-year [6] - The Tissue Health Plus (THP) segment reported a net loss of $2.5 million, compared to a net loss of $1.3 million last year [32] Market Data and Key Metrics Changes - The company expanded its distributor network to over 400 distributors, up from more than 300 the previous year [18] - The customer base grew to over 1,400 healthcare facilities, compared to more than 1,100 in the prior year [19] - The number of surgeons using the company's products in existing facilities increased significantly, indicating strong growth potential [20] Company Strategy and Development Direction - The company is focused on preserving capital while driving sustainable growth and long-term value creation [14] - A formal process has been initiated to evaluate strategic alternatives for the THP segment, aiming to maximize shareholder value [12][13] - The company plans to reduce cash investment in the THP segment in the second half of 2025 to preserve capital [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the financial resources available to support key growth initiatives, including cash flow from the Surgical segment and available borrowing capacity [35] - The company does not anticipate a material impact from tariffs on operations in 2025 [35] - Management highlighted the importance of expanding clinical evidence for key products to educate the market on their benefits [8] Other Important Information - The company completed the acquisition of CarePix, which is integral to the THP technology platform [22] - The THP pilot program began with a provider group, aiming to validate and optimize the THP technology platform [23][24] - The company achieved two product development milestones under its exclusive license agreement with Biomimetic Innovations Limited [35] Q&A Session Summary Question: How long does it typically take for a new distributor to become productive? - The timeline varies based on market conditions and existing approvals, ranging from days to months [39][40] Question: What is the expected cadence of operating expenses moving into 2026? - The company anticipates THP segment investments between $5.5 million and $6.5 million for the second half of the year [41] Question: Can you provide details on the growth of specific products like CELERATE and BioSurg? - CELERATE and BioSurg are key growth drivers, with both products showing steady growth and significant market potential [48] Question: What are the main drivers for seeking strategic alternatives for THP? - The company is looking for strategic partners to complement its investments and expand the THP product line [52][53]

Exhibit 99.1 Sanara MedTech Inc. Reports Second Quarter 2025 Financial Results (Unaudited) Net Revenue Increased 28% Year-Over-Year in Q2; Increased 27% Year-Over-Year in First Six Months of 2025 Announces Process to Evaluate Strategic Alternatives for its Tissue Health Plus, LLC Subsidiary FORT WORTH, TX, August 13, 2025 (GLOBE NEWSWIRE) - Sanara MedTech Inc. ("Sanara," the "Company," "we," "our" or "us") (Nasdaq: SMTI), a medical technology company focused on developing and commercializing transformative ...

Core Insights - Sanara MedTech Inc. reported a 28% year-over-year increase in net revenue for Q2 2025, reaching $25.8 million, driven by strong sales in its Sanara Surgical segment [5][8] - The company is evaluating strategic alternatives for its subsidiary, Tissue Health Plus, LLC, to maximize shareholder value while continuing to invest in its technology platform [4][12] Financial Performance - Q2 2025 net revenue increased to $25.8 million from $20.2 million in Q2 2024, a growth of $5.7 million or 28% [5][8] - For the first six months of 2025, net revenue rose 27% year-over-year to $49.3 million, compared to $38.7 million in the same period of 2024 [15] - The company reported a net loss of $2.0 million in Q2 2025, an improvement from a net loss of $3.5 million in Q2 2024 [12][16] - Adjusted EBITDA for Q2 2025 was $2.7 million, compared to $0.6 million in Q2 2024 [13] Segment Performance - The Sanara Surgical segment achieved a net income of $0.5 million in Q2 2025, a significant improvement from a net loss of $2.2 million in Q2 2024 [12] - The Tissue Health Plus segment reported a net loss of $2.5 million in Q2 2025, compared to a net loss of $1.3 million in Q2 2024 [12] - For the first six months of 2025, the Sanara Surgical segment generated Segment Adjusted EBITDA of $7.4 million, up from $2.5 million in the same period of 2024 [17] Revenue Breakdown - Sales of soft tissue repair products contributed $22.7 million in Q2 2025, up from $17.6 million in Q2 2024, marking a 28% increase [7][8] - Bone fusion products sales increased to $3.1 million in Q2 2025, a 25% rise from $2.5 million in Q2 2024 [7][8] Operating Expenses - Operating expenses for Q2 2025 were $23.9 million, an increase of 14% from $21.0 million in Q2 2024, primarily due to higher selling, general, and administrative expenses [10] - The gross profit for Q2 2025 was $23.9 million, reflecting a gross margin of 93%, up from 90% in Q2 2024 [9] Cash Flow and Debt - Cash flow from operating activities in Q2 2025 was $2.7 million, compared to cash used in operating activities of $1.4 million in Q2 2024 [14] - As of June 30, 2025, the company had $17.0 million in cash and $44.2 million in long-term debt, compared to $15.9 million and $30.7 million, respectively, at the end of 2024 [14]