UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number: 0-11635 STRATA SKIN SCIENCES, INC. (Exact name of registrant as specified in its charter) | Delaware | 13-3986004 | | --- | --- | | (State or Other Jurisdiction of incorporation or ...

Core Viewpoint - STRATA Skin Sciences, Inc. has filed a Form 25 with the SEC to deregister its common stock and has suspended trading on Nasdaq, indicating a strategic shift to "go dark" and reduce compliance costs [1][2]. Group 1: Company Actions - The company plans to file a Form 15 around March 2, 2026, to terminate the registration of its common stock and suspend reporting obligations under the Exchange Act [1]. - The delisting from Nasdaq is expected to save significant time and money in general and administrative expenses, allowing the company to focus on its operating plan and customer needs [2]. Group 2: Financial Position - STRATA finished the 2025 fiscal year with a strong balance sheet, including $8 million in cash, indicating financial stability [3]. - The company is engaging with its lender to adjust loan terms to reflect its new status as a private company, with management confident in a favorable outcome [3]. Group 3: Strategic Focus - The decision to "go dark" is aimed at minimizing management distractions related to compliance, allowing for a greater focus on long-term value creation and market expansion [2][3]. - The company anticipates leveraging changes in CPT codes to enhance its market position for XTRAC® excimer laser and TheraclearX® users, which could drive future growth [3].

Core Insights - STRATA Skin Sciences, Inc. (SSKN) has highlighted findings from a meta-analysis that supports the clinical efficacy of its 308 nm excimer laser technology for treating plaque psoriasis [1][12] - The meta-analysis, published in a peer-reviewed journal, indicates significant improvements in disease severity scores following targeted treatment protocols [1][10] Company Performance - Following the announcement of the meta-analysis, SSKN shares fell more than 8%, and the stock has decreased by 82.3% over the last six months, compared to a 37% decline in the industry [3][8] - The current market capitalization of SSKN is $2 million [6] Clinical Validation and Market Position - The findings from the meta-analysis provide independent validation of SSKN's excimer laser technology, which may enhance physician adoption and patient confidence [4][12] - The pooled data from the analysis showed PASI reductions of 56%-85% within 10-14 treatments, confirming the effectiveness of MED-guided dosing strategies [8][10] - The publication emphasizes the importance of MED-guided calibration for targeted UVB delivery, which can improve treatment outcomes while minimizing damage to healthy skin [11][12] Industry Outlook - The global psoriasis treatment market was valued at $34.14 billion in 2025 and is projected to grow to approximately $73.04 billion by 2035, with a CAGR of 7.9% [13] - The growth in the market is driven by increasing prevalence, better diagnosis, and demand for effective therapies, alongside innovations in biologics and device-based treatments [14]

Core Insights - STRATA Skin Sciences, Inc. announces the addition of the XTRAC® 308 nm excimer laser to the clinical offerings of Johns Hopkins Dermatology, enhancing treatment options for chronic inflammatory and autoimmune skin diseases [1][2] Group 1: Company Overview - STRATA Skin Sciences is a medical technology company focused on developing and marketing innovative dermatologic treatments, including the XTRAC excimer laser, VTRAC lamp systems, and TheraClearX Acne Therapy System [5] - The company employs a unique Partnership Program that offers a fee per treatment cost structure, including on-site training, service, maintenance, and advertising support for practices [6] Group 2: Technology and Clinical Impact - The integration of XTRAC into Johns Hopkins' clinical programs supports advanced, targeted care for conditions like psoriasis, vitiligo, and atopic dermatitis, while also facilitating ongoing clinical research [2][3] - Excimer laser technology is backed by over 300 published peer-reviewed clinical studies, reinforcing its effectiveness in managing inflammatory skin conditions [4] Group 3: Academic Collaborations - STRATA collaborates with leading academic institutions, including New York University, University of California, and Cleveland Clinic, to promote evidence-based dermatologic care and expand access to FDA-cleared phototherapy [3]

Core Insights - The February 2026 meta-analysis confirms the clinical efficacy of 308 nm Excimer laser therapy for plaque psoriasis, highlighting its effectiveness in reducing PASI scores significantly [1][11] Clinical Efficacy - The systematic review and meta-analysis published in the Journal of Drugs in Dermatology evaluated clinical trials that demonstrated substantial reductions in PASI scores, with patients typically achieving these outcomes within 10–14 treatments over approximately 5–7 weeks [1][3][8] - Specific studies reported significant PASI improvements: Tang et al. showed a reduction from 11.47 to 5.08 (~56%), He et al. from 14.73 to 2.42 (~84%), Gerber et al. from 13.70 to 2.10 (~85%), and Dong et al. from 12.02 to 4.09 (~66%) [9] Treatment Protocols - The analysis emphasized the importance of MED-guided dosing, which calibrates the lowest UVB fluence producing visible erythema at 24 hours, allowing for targeted treatment [4] - Treatment fluences across studies ranged from approximately 200–600 mJ/cm² per session (1–3× MED), with some protocols using up to 1,200 mJ/cm² total fluence per session, indicating a higher energy level compared to conventional UVB phototherapy [5][6] Technological Advancements - STRATA's high-power XTRAC® technology models facilitate the delivery of optimized targeted doses efficiently, supporting shorter treatment times while maintaining favorable practice economics [7] Industry Commitment - STRATA Skin Sciences is dedicated to advancing clinical evidence-based dermatologic therapies, focusing on improving outcomes for patients with chronic inflammatory skin diseases [11][12]

Core Insights - STRATA Skin Sciences, Inc. participated in the 2025 Ibero-Latin American Congress of Dermatology (TeraCILAD) showcasing its XTRAC® excimer laser and TheraclearX® acne therapy system [1][4] - By the end of 2025, STRATA expects to have over 12 new recurring TheraclearX® accounts in Mexico, indicating a growing adoption of this acne treatment by dermatologists [1][5] Conference Presentations & Clinical Insights - Dr. Melissa Lomeli presented her experience with TheraclearX® at TeraCILAD, highlighting the potential for acne improvement in just one 20-minute session [3] - Dr. Henry Lim discussed the efficacy of XTRAC 308 nm Excimer Laser Therapy for treating vitiligo, psoriasis, and atopic dermatitis [3] Market Context - STRATA engaged with leading dermatologists at TeraCILAD to present the clinical performance of its technologies, with XTRAC® recognized for treating inflammatory and autoimmune skin disorders and TheraclearX® gaining traction as a non-pharmaceutical acne solution [4][7] - The interest from dermatologists in effective, non-systemic treatment options was evident, reinforcing the value of STRATA's technologies in improving patient outcomes [5] Strategic Outlook - STRATA aims to expand access to advanced dermatology solutions across Latin America and globally, with a focus on engaging key opinion leaders and growing recurring revenue opportunities through device-based therapies [6][8] - The company anticipates that fully developed partner clinics could generate upwards of $30,000 in annual revenue per clinic from TheraclearX® placements [6]

Revenue Performance - Total revenues for the three months ended September 30, 2025, were $6.9 million, a decrease from $8.8 million in the same period of 2024, while total revenues for the nine months ended September 30, 2025, were $21.4 million, down from $24.0 million in 2024[158]. - Recurring treatment revenue for the three months ended September 30, 2025, was $5.5 million, representing approximately 67,000 XTRAC treatments, compared to $5.4 million for approximately 64,000 treatments in the same period of 2024[159]. - Dermatology procedures equipment revenues for Q3 2025 were $1.4 million, a decrease from $3.4 million in Q3 2024, representing a 58.8% decline[164]. - Dermatology recurring procedures revenues for Q3 2025 were $5.5 million, slightly up from $5.4 million in Q3 2024, with a gross profit percentage of 61.6% compared to 65.4%[170]. Device Placement and Usage - The number of XTRAC systems placed in dermatologists' offices decreased from 864 as of December 31, 2024, to 838 as of September 30, 2025[146]. - As of September 30, 2025, there were 161 TheraClear devices placed in dermatologists' offices, an increase from 135 devices in the same period of 2024[161]. - International sales included 8 systems in Q3 2025 (6 XTRAC and 2 VTRAC) compared to 20 systems in Q3 2024 (20 XTRAC)[165]. Financial Performance - Gross profit for Q3 2025 decreased to $4.2 million from $5.3 million in Q3 2024, with a gross profit percentage of 60.4% compared to 60.1%[168]. - For the nine months ended September 30, 2025, gross profit was $12.3 million, down from $13.5 million in the same period in 2024, with a gross profit percentage increase to 57.3% from 56.1%[169]. - As of September 30, 2025, the company reported a net loss of $1.622 million, an improvement from a net loss of $2.074 million for the same period in 2024[182]. - The company had negative working capital of $0.8 million as of September 30, 2025, compared to positive working capital of $3.2 million as of December 31, 2024[183]. - Cash and cash equivalents decreased to $7.1 million as of September 30, 2025, down from $8.6 million as of December 31, 2024[183]. - Net cash used in operating activities increased to $2.6 million for the nine months ended September 30, 2025, compared to $0.5 million for the same period in 2024[191]. Expenses and Gains - Selling and marketing expenses increased to $3.2 million in Q3 2025 from $3.0 million in Q3 2024, driven by higher employee-related expenses and advertising campaigns[175]. - General and administrative expenses decreased to $2.7 million in Q3 2025 from $3.6 million in Q3 2024, primarily due to an increase in sales tax accrual in 2024[177]. - Settlement gains for Q3 2025 were $0.7 million, compared to no settlement gains in Q3 2024, due to supplier obligation settlements[178]. - Engineering and product development expenses for the nine months ended September 30, 2025, were $0.4 million, down from $0.7 million in the same period in 2024[174]. - Interest expense remained stable at $0.5 million for Q3 2025 and Q3 2024, with a total of $1.5 million for the nine months ended September 30, 2025, compared to $1.6 million in the same period in 2024[179]. Market and Operational Challenges - The impact of the COVID-19 pandemic has led to the suspension of elective procedures and the temporary closure of many physician practices, affecting operational and financial performance[150]. - The company has faced supply chain challenges due to the Russia-Ukraine war, impacting the availability and price of essential gases for laser operations[151]. - The U.S. introduced trade policy actions in 2025 that increased import tariffs, potentially affecting product costs and demand in the dermatology procedures equipment segment[153]. Future Plans and Financing - The company plans to increase direct-to-patient advertising for XTRAC treatments targeting psoriasis and vitiligo patients through various media, including social media platforms[162]. - The company expects to write off a product technology intangible asset with a net carrying value of $0.7 million and derecognize a liability for contingent consideration of $1.2 million in Q4 2025[187]. - Net cash provided by financing activities was $2.2 million for the nine months ended September 30, 2025, compared to $1.9 million for the same period in 2024[193]. - The company amended its credit facility in November 2025, pausing the measurement of net revenue for financial covenant compliance through September 30, 2026[186]. - The company has the potential to incur a royalty of 5% on sales of TheraClear® X devices starting January 1, 2027, contingent on achieving certain revenue milestones[188]. - The company may sell up to an additional $6.5 million of its common stock under an existing equity distribution agreement as of September 30, 2025[189].

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Financial Data and Key Metrics Changes - Total revenue for Q3 2025 was $6.9 million, down 20% compared to Q3 2024, primarily due to a challenging international environment [10] - Recurring revenue remained solid, with gross code sales up 4.1% and net U.S. recurring XTRAC revenue up 2.8% [10] - Global recurring revenue of $5.5 million increased 3% year over year, while equipment revenue decreased 60% [10] - Gross profit for Q3 2025 was $4.2 million, representing a gross margin of approximately 60%, which was flat compared to the prior year [11] - Net loss for Q3 2025 was $1.6 million, or EPS of negative $0.36, compared to a net loss of $2.1 million, or EPS of negative $0.51 in Q3 2024 [11] - Adjusted EBITDA was slightly positive in the quarter compared to negative $240,000 in the comparable quarter of the prior year [11] Business Line Data and Key Metrics Changes - Average gross billings per device for U.S. partner clinics was $5,981 for Q3 2025, an increase of 8.5% versus Q3 2024, marking the highest since Q4 2022 [7] - 99 out of approximately 838 clinics have entered the Elevate 360 program, resulting in an average growth of 7% year over year for those businesses [6] Market Data and Key Metrics Changes - The expansion of CPT codes for STRATA's XTRAC laser is expected to increase the addressable market to over 30 million patients, tripling the total available market [6] - The company is experiencing challenges in its international business, primarily due to current U.S. trade policies, which have pressured total revenue [8] Company Strategy and Development Direction - The company is focused on expanding reimbursement eligibility for excimer laser treatments to include multiple inflammatory and autoimmune skin conditions, which is pivotal for future growth [4] - STRATA is strengthening practice partnerships through the Elevate 360 consulting model and innovative direct-to-consumer (DTC) campaigns [6] - The company aims to increase utilization of existing devices while removing non-productive devices from the market [15] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about a seasonally stronger Q4 2025, driven by expanded indications for the excimer laser and favorable reimbursement trends [12] - The lingering impact of tariffs on international business was acknowledged, with hopes for improvement in the future [13] Other Important Information - The company raised $2.2 million net in a common registered direct offering during the quarter [11] - The litigation against LaserOptic is progressing positively, with potential for significant damages and an injunction limiting further damage to the domestic recurring business [9] Q&A Session Summary Question: Can you talk about average revenue per device in Q3 and trends for Q4? - The average revenue per device was $5,981, the highest since 2022, with expectations for continued growth due to increased utilization and removal of non-productive devices [15] Question: Any increase in show-up rates from DTC campaigns? - DTC campaigns have shown improved cost per acquisition and better conversion rates, contributing to increased recurring revenue [20] Question: What is the installed base for TheraClearX by the end of 2025? - The U.S. install base for TheraClearX is about 161 devices, with expectations to approach 200 devices by the end of 2025 [26] Question: Any updates on the litigation and potential device recoveries? - The company is actively pursuing the return of approximately 75-100 accounts affected by false claims, with a significant number of devices expected to come back [38] Question: Will there be temporary codes for 2026? - CMS has indicated that they do not plan to create temporary codes for 2026, focusing instead on the expanded codes effective January 1, 2027 [44]

Revenue Performance - Revenue for Q3 2025 was $6.9 million, a decrease of 21% compared to Q3 2024[6] - Total revenues for the three months ended September 30, 2025, decreased by 21.2% to $6.929 million from $8.797 million in the same period of 2024[28] - Global recurring revenue increased by 3% year-over-year to $5.5 million, while equipment revenue decreased by 60% to $1.4 million[6] Profitability and Loss - Net loss for Q3 2025 was $1.6 million, or EPS of negative $0.36, an improvement from a net loss of $2.1 million, or EPS of negative $0.51, in Q3 2024[7] - Net loss for the three months ended September 30, 2025, was $1.622 million, compared to a net loss of $2.074 million in the same period of 2024, representing a 22% improvement[28] - Gross profit for the nine months ended September 30, 2025, was $12.267 million, down 8.9% from $13.459 million in 2024[28] Operating Expenses - Total operating expenses decreased to $5.4 million from $6.9 million in the prior-year period[7] - Operating expenses for the nine months ended September 30, 2025, totaled $17.455 million, a decrease of 5.3% from $18.429 million in 2024[28] - The company recorded a stock-based compensation expense of $469,000 for the nine months ended September 30, 2025, compared to $301,000 in 2024[31] Cash and Assets - Cash and cash equivalents at September 30, 2025, were $7.1 million[8] - Cash and cash equivalents at the end of the period were $7.076 million, down from $8.396 million at the end of September 2024[30] - Total current assets decreased by 14% to $14.272 million as of September 30, 2025, from $16.595 million at December 31, 2024[26] Liabilities - Total liabilities decreased slightly by 1.8% to $29.403 million as of September 30, 2025, from $29.956 million at December 31, 2024[26] Market and Growth Potential - Positive developments in ongoing litigation are expected to translate to increased revenue in the coming quarters[3] - The company anticipates growth from newly approved reimbursement codes for XTRAC treatments, potentially tripling the covered patient population in the U.S.[5] Device Install Base - The U.S. install base of XTRAC devices declined by 6 to 838, while the install base of TheraClearX was 161[5] Billing Metrics - Average gross billings per device increased by 8.5% to $5,981, the highest since Q4 2022[5] Shareholder Information - The weighted average shares of common stock outstanding for the three months ended September 30, 2025, increased to 4,481,337 from 4,038,988 in 2024[28]