Company Overview - STRATA Skin Sciences focuses on medical technology for dermatology, addressing a $38 billion market across psoriasis, vitiligo, eczema, and acne[5,7] - The company's capitalization includes a market cap of $12 million, cash & equivalents of $8.4 million, and debt of $15.2 million as of September 30, 2024[6] - Insider ownership is approximately 39%[6] Financial Performance - In Q3 2024, total revenue was $8.8 million, a 1% decrease year-over-year, while global net recurring revenue increased by 2% to $5.4 million[26] - Gross margin in Q3 2024 was 60.3%, a 430 basis points increase year-over-year[24] - Operating expenses in Q3 2024 decreased by 7% year-over-year to $5.2 million (excluding one-time accrual expense)[25] - The company achieved a non-GAAP operating profit of $128,000 in Q3 2024, the first positive operating profit since early 2018[27] Business Model and Growth Strategy - The company has an installed base of 873 XTRAC devices domestically for psoriasis, vitiligo, and eczema treatments, and 135 TheraClear devices for acne treatments[22,19] - The company aims to increase recurring revenue per device by 40% through re-emphasis on DTC marketing in the U S [22] - The company utilizes a "business in a box" model, providing dermatology practices with a complete solution without upfront capital spend[22] - International sales operations include over 1,700 devices installed, with expansion opportunities in Latin America and Europe[19,51,53]

Core Viewpoint - STRATA Skin Sciences, Inc. has announced that the American Medical Association has accepted revisions to CPT codes 96920-96922, expanding reimbursement eligibility for excimer laser treatments to include multiple inflammatory and autoimmune skin conditions beyond psoriasis, reflecting over 20 years of clinical evidence and real-world use of STRATA's XTRAC Excimer Lasers [1][2][3] Reimbursement Expansion - The updated CPT codes align with current FDA clearances and commercial payer coverage guidelines, expected to reduce systemic denials and the need for prior authorizations [2] - The revised codes explicitly include treatment for conditions such as vitiligo, atopic dermatitis, mycosis fungoides, lichen planus, alopecia areata, and cutaneous T-cell lymphoma, potentially increasing the patient base from 10 million psoriasis patients to over 30 million [2][3] Clinical Significance - STRATA's CEO emphasized that this milestone reflects the broader clinical utility of the XTRAC excimer laser, supporting the mission to expand access to non-drug dermatologic solutions [3][5] - Experts in dermatology highlighted the importance of excimer lasers in transforming treatment for conditions like vitiligo and atopic dermatitis, validating the broader clinical value of the technology [3][4] Market Impact - The expanded CPT code coverage is expected to generate significant commercial growth, with non-psoriasis indications already accounting for approximately 30% of excimer laser treatment volume [3][6] - STRATA anticipates broader adoption of the XTRAC platform beyond the existing 1,400 clinics and 4,000 medical providers, supporting accelerated revenue growth under its recurring-use business model [3][6] Collaboration and Advocacy - STRATA has collaborated with leading clinical Key Opinion Leaders, patient advocacy groups, and the American Academy of Dermatology to advocate for the expanded indications of the XTRAC excimer laser [7]

Part I. FINANCIAL INFORMATION [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements for STRATA Skin Sciences, Inc. for the quarter ended March 31, 2025 [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, the company's total assets were $34.3 million, a decrease from $36.2 million at the end of 2024, primarily driven by a reduction in cash and cash equivalents and property and equipment Condensed Consolidated Balance Sheets (in thousands) | Balance Sheet Item | March 31, 2025 (unaudited) | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $6,512 | $7,261 | | Total current assets | $15,876 | $16,595 | | Total assets | $34,262 | $36,157 | | Total current liabilities | $15,139 | $14,625 | | Total liabilities | $31,593 | $31,185 | | Total stockholders' equity | $2,669 | $4,972 | [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For the three months ended March 31, 2025, the company reported a net loss of $2.4 million, or ($0.58) per share, an improvement from the net loss of $3.4 million in the same period of 2024 Q1 2025 vs. Q1 2024 Statement of Operations (in thousands, except per share data) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Revenues, net | $6,812 | $6,754 | | Gross profit | $3,647 | $3,080 | | Loss from operations | ($2,015) | ($2,889) | | Net loss | ($2,432) | ($3,368) | | Net loss per share, basic and diluted | ($0.58) | ($0.96) | [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the first quarter of 2025, net cash used in operating activities was $0.55 million, an improvement from $0.80 million used in Q1 2024, with overall cash decreasing by $0.75 million Cash Flow Summary for Three Months Ended March 31 (in thousands) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | ($550) | ($804) | | Net cash used in investing activities | ($199) | ($725) | | Net cash used in financing activities | $0 | ($18) | | **Net decrease in cash, cash equivalents and restricted cash** | **($749)** | **($1,547)** | [Notes to Condensed Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes provide critical details on the company's operations, accounting policies, and financial items, including business, geopolitical risks, liquidity, and tax contingencies - The company is a medical technology firm focused on dermatologic conditions, with primary products being the **XTRAC®** and **Pharos®** excimer lasers for psoriasis and vitiligo, and the **TheraClear®** system for acne[21](index=21&type=chunk) - The Russia-Ukraine War has impacted the supply and price of noble gases (like neon) essential for the company's lasers, and the Middle East conflict presents a potential but unrealized risk to distributors in the region[26](index=26&type=chunk)[28](index=28&type=chunk) - Management believes that existing cash, anticipated revenues, and expense management will be sufficient to fund operations for at least the next **12 months**, despite a history of recurring losses[45](index=45&type=chunk) - The company faces significant contingencies from state sales and use tax matters, with New York and California having assessed a combined **$5.2 million** in taxes, penalties, and interest, and an appeal in New York was recently lost at the Appellate Division level[106](index=106&type=chunk)[107](index=107&type=chunk)[109](index=109&type=chunk) Segment Performance - Q1 2025 (in thousands) | Segment | Revenues, net | Gross Profit | Income (Loss) from Operations | | :--- | :--- | :--- | :--- | | Dermatology Recurring Procedures | $4,727 | $2,678 | $535 | | Dermatology Procedures Equipment | $2,085 | $969 | $23 | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=24&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's Q1 2025 performance, highlighting a slight revenue increase to $6.8 million and a significant improvement in gross profit margin to 53.5% due to cost efficiencies [Results of Operations](index=26&type=section&id=Results%20of%20Operations) Total revenues for Q1 2025 were $6.8 million, a marginal increase from Q1 2024, with gross profit rising to $3.6 million and non-GAAP adjusted EBITDA improving to a loss of $0.5 million Gross Profit Analysis (in thousands) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Revenues, net | $6,812 | $6,754 | | Gross profit | $3,647 | $3,080 | | Gross profit percentage | 53.5% | 45.6% | - The increase in gross profit percentage was primarily driven by the use of refurbished parts with lower costs and the impact of an inventory write-off in the prior-year period[135](index=135&type=chunk)[136](index=136&type=chunk)[138](index=138&type=chunk) - Selling and marketing expenses remained flat at **$3.0 million**, as a decrease in employee-related costs was offset by increased spending on the direct-to-patient advertising campaign for XTRAC[140](index=140&type=chunk) Non-GAAP Adjusted EBITDA Reconciliation (in thousands) | Line Item | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net loss | $(2,432) | $(3,368) | | Adjustments | $1,885 | $2,089 | | **Non-GAAP adjusted EBITDA** | **$(547)** | **$(1,279)** | [Liquidity and Capital Resources](index=30&type=section&id=Liquidity%20and%20Capital%20Resources) As of March 31, 2025, the company had working capital of $0.7 million and total cash, cash equivalents, and restricted cash of $7.8 million, deemed sufficient for the next 12 months - Working capital decreased to **$0.7 million** as of March 31, 2025, from **$2.0 million** at December 31, 2024, primarily due to a decrease in cash[146](index=146&type=chunk) - The company has a Senior Term Facility with MidCap, which was amended in February and March 2024 to revise financial covenants and clarify collateral account provisions[147](index=147&type=chunk)[148](index=148&type=chunk) - An equity distribution agreement allows the company to sell up to an additional **$8.9 million** of its common stock in "at-the-market" offerings as of March 31, 2025[150](index=150&type=chunk) - Management believes current cash and anticipated revenues will be sufficient to satisfy working capital needs and other liquidity requirements for at least the next **12 months**[151](index=151&type=chunk) [Item 3. Quantitative and Qualitative Disclosure about Market Risk](index=32&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosure%20about%20Market%20Risk) The company has indicated that this section is not applicable for this reporting period - Not applicable[159](index=159&type=chunk) [Item 4. Controls and Procedures](index=32&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were not effective as of March 31, 2025, due to a material weakness in internal control over financial reporting - Management concluded that disclosure controls and procedures were not effective as of March 31, 2025[160](index=160&type=chunk) - The ineffectiveness is due to a material weakness identified as of December 31, 2024, related to a lack of detailed management review of account reconciliations and analyses[160](index=160&type=chunk) - The company is actively working to remediate the material weakness by improving processes and controls, including enhancing senior management review[160](index=160&type=chunk) Part II. OTHER INFORMATION [Item 1. Legal Proceedings](index=33&type=section&id=Item%201.%20Legal%20Proceedings) There were no new reportable legal proceedings or material developments in previously disclosed legal matters during the three months ended March 31, 2025 - For the quarter ended March 31, 2025, there have been no reportable legal proceedings or material developments to previously reported legal proceedings[165](index=165&type=chunk) [Item 1A. Risk Factors](index=33&type=section&id=Item%201A.%20Risk%20Factors) This section introduces a new risk factor related to changes in U.S. trade policy, including potential tariffs, which could increase manufacturing costs and reduce customer purchasing power - A new risk factor has been identified concerning changes in U.S. trade policy, including the imposition of tariffs[167](index=167&type=chunk) - The U.S. government announced a baseline tariff of **10%** on products from all countries, which could increase the cost of manufacturing, boost inflation, and negatively impact customer demand[167](index=167&type=chunk)[168](index=168&type=chunk) [Item 5. Other Information](index=33&type=section&id=Item%205.%20Other%20Information) No directors or officers adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement during the quarter ended March 31, 2025 - During the first quarter of 2025, no directors or officers adopted or terminated a Rule 10b5-1 trading arrangement[169](index=169&type=chunk) [Item 6. Exhibits](index=34&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, primarily consisting of CEO and Chief Accounting Officer certifications List of Exhibits | Exhibit No. | Description | | :--- | :--- | | 31.1 | Rule 13a-14(a) Certificate of Chief Executive Officer | | 31.2 | Rule 13a-14(a) Certificate of Chief Accounting Officer | | 32.1 | Certifications of CEO and CAO pursuant to 18 U.S.C. Section 1350 |

Financial Data and Key Metrics Changes - Total revenue for Q1 2025 was $6.8 million, up 1% compared to Q1 2024 [15] - Global recurring revenue for Q1 2025 was $4.7 million, also up 1% year-over-year [15] - Gross profit increased to $3.6 million for Q1 2025, up from $3.1 million in the same period in 2024, resulting in a gross margin of 53.5% compared to 45.6% in Q1 2024 [16] - Total operating expenses decreased to $5.7 million in Q1 2025 from $6.0 million in Q1 2024, a reduction of 5% [16] - Cash burn improved to $749,000 in Q1 2025 from $1.55 million in the prior year [17] Business Line Data and Key Metrics Changes - The installed base of XTRAC devices in the U.S. is approximately 850, with a significant increase in recurring revenue per device [5][9] - The TheraClear X device installed base reached 160 units, up from 104 units at the end of Q1 2024, with revenue growing over 50% year-over-year in six of the last seven quarters [11] - The number of patients submitted for reimbursement for TheraClear X increased by 138% year-over-year, with pre-authorization rates exceeding 85% [12][26] Market Data and Key Metrics Changes - International business sales reached $2.5 million, up 8% year-over-year, with equipment sales up 13% and recurring treatments revenue up 27% [12] - The company is cautiously monitoring the potential negative impact of tariffs on near-term sales, particularly in international markets [13][19] Company Strategy and Development Direction - The company is executing a multifaceted turnaround strategy focused on increasing recurring revenue per device and optimizing device placements [4][5] - The Elevate360 consulting model is being expanded to improve patient conversion and device utilization in underperforming clinics [6][7] - The strategy includes removing underutilized devices to ensure capital efficiency and focusing on clinics that show potential for growth [7][49] Management's Comments on Operating Environment and Future Outlook - Management expressed caution regarding the potential impact of tariffs on international revenue, although there was no immediate effect observed in Q1 2025 [18][19] - The company anticipates favorable outcomes from ongoing discussions regarding reimbursement coverage expansions [10] - Management is optimistic about the traction gained from the turnaround strategy and the increasing demand for cost-effective treatments [12] Other Important Information - The average revenue per XTRAC device in the U.S. was approximately $22,000 in 2024, with potential for significant revenue growth from existing devices [8][9] - The company exited Q1 2025 with cash and cash equivalents totaling $7.8 million, including $1.3 million of restricted cash [18] Q&A Session Summary Question: Can you discuss the TheraClear pipeline and marketplace learnings? - Management noted that the installed base is growing, with 160 devices deployed and a significant increase in patients submitted for reimbursement [21][22] Question: What are the utilization trends for TheraClear? - Management provided insights on the revenue breakeven points and the expected number of procedures per device, indicating a strong potential for growth [28][29] Question: Is there any potential impact from tariffs on domestic business? - Management clarified that the domestic supply chain is minimally impacted by tariffs, primarily affecting international sales and service support [36][38] Question: What is the focus for the rest of 2025 regarding the installed base? - Management indicated a dual focus on increasing utilization of the current installed base while also seeking to sign new clinics [40][41]

Financial Data and Key Metrics Changes - Total revenue for Q1 2025 was $6.8 million, up 1% compared to Q1 2024 [16] - Global recurring revenue for Q1 2025 was $4.7 million, also up 1% year-over-year [16] - Gross profit increased to $3.6 million for Q1 2025, up from $3.1 million in the same period in 2024, resulting in a gross margin of 53.5% compared to 45.6% in Q1 2024 [17] - Total operating expenses decreased to $5.7 million in Q1 2025 from $6.0 million in Q1 2024, a reduction of 5% [18] - Cash burn improved to $749,000 in Q1 2025 from $1.55 million in the prior year [19] Business Line Data and Key Metrics Changes - The installed base of XTRAC devices in the U.S. is approximately 850, with a significant increase in recurring revenue per device [6][11] - The TheraClear X device installed base reached 160 units, up from 104 units at the end of Q1 2024, with revenue growing over 50% year-over-year in six of the last seven quarters [13] - The number of patients submitted for reimbursement for TheraClear X increased by 138% year-over-year, with pre-authorization rates exceeding 85% [14][29] Market Data and Key Metrics Changes - International business sales reached $2.5 million, up 8% year-over-year, with equipment sales up 13% and recurring treatments revenue up 27% [14] - The company is cautiously monitoring the potential negative impact of tariffs on international sales, particularly in Asian markets [15][41] Company Strategy and Development Direction - The company is executing a multifaceted turnaround strategy focused on increasing recurring revenue per device and optimizing device placements [5] - The Elevate360 consulting model is being expanded to improve patient conversion and device utilization in underperforming clinics [6][7] - The strategy includes removing underutilized devices to ensure capital efficiency and focusing on clinics that show potential for growth [9][54] Management's Comments on Operating Environment and Future Outlook - Management cautioned about potential impacts of tariffs on international business, although there was no immediate effect observed in Q1 2025 [20] - The company anticipates favorable outcomes from ongoing discussions regarding reimbursement coverage expansions [12] - Management expressed optimism about the traction gained from the turnaround strategy and the increase in demand for cost-effective treatments [14] Other Important Information - The company exited Q1 2025 with cash and cash equivalents totaling $7.8 million, including $1.3 million of restricted cash [20] - The average revenue per XTRAC device in the U.S. was approximately $22,000 in 2024, indicating potential for significant revenue growth with increased utilization [10] Q&A Session Summary Question: Can you discuss the TheraClear pipeline and marketplace learnings? - Management noted that the installed base is growing, with 160 devices deployed and a significant increase in patients submitted for reimbursement [24][25] Question: What are the utilization trends for TheraClear? - Management provided insights on the revenue breakeven points and the expected number of procedures per device, indicating a focus on increasing utilization [31] Question: What is the potential impact of tariffs on domestic business? - Management clarified that the domestic supply chain is minimally impacted by tariffs, but there are peripheral effects due to suppliers raising prices [41][42] Question: What is the focus for the rest of 2025 regarding the installed base? - Management indicated a dual focus on increasing utilization of the current installed base while also signing new clinics [46][54] Question: How many clinics could benefit from the Elevate360 program? - Management stated that they are currently implementing the program in about 100 accounts, with plans for further expansion [58][60]

Revenue Performance - Revenue for Q1 2025 was $6.8 million, a 1% increase compared to Q1 2024[6] - International revenue grew 8% in Q1 2025, now accounting for 36% of total revenue[5] - Equipment revenue for Q1 2025 was $2.1 million, up 1.4% from the previous year[6] - Average net revenue per domestic XTRAC® system increased to $4,776, a 3% year-over-year growth[6] Profitability and Loss - Gross margin improved to 53.5%, up 790 basis points from 45.6% in the prior year[6] - Adjusted EBITDA improved by $732 thousand to negative $547 thousand compared to negative $1.3 million in the prior year[6] - Net loss for Q1 2025 was $2.4 million, or EPS of negative $0.58, an improvement from a net loss of $3.4 million in Q1 2024[8] - Net loss for the three months ended March 31, 2025, was $2,432 million, an improvement from a net loss of $3,368 million in the same period of 2024[28] Operating Expenses - Operating expenses decreased by 5% to $5.7 million, with engineering & product development down 60%[8] - Cash flows from operating activities resulted in a net cash outflow of $550 million, compared to a net cash outflow of $804 million in the prior year[28] - Depreciation and amortization expenses were $1,220 million, slightly down from $1,249 million in the previous year[28] Cash and Liquidity - Total cash at the end of Q1 2025 was $7.8 million[9] - Cash, cash equivalents, and restricted cash at the end of the period totaled $7,846 million, up from $6,571 million at the end of the same period in 2024[28] - The net decrease in cash, cash equivalents, and restricted cash was $749 million, compared to a decrease of $1,547 million in the prior year[28] - Cash paid for interest during the year was $450 million, down from $480 million in the previous year[28] Inventory and Receivables - Inventory write-off was recorded at $0 million, a significant decrease from $141 million in the prior year[28] - Accounts receivable decreased by $590 million, from $726 million in 2024 to $136 million in 2025[28] Strategic Initiatives - Direct-to-consumer strategy drove 32% and 128% increases in unique Psoriasis and Acne patients, respectively[4] - The company made a purchase of property and equipment totaling $199 million, a decrease from $725 million in the same period last year[28] - Operating lease right-of-use assets obtained in exchange for operating lease were $0 million, down from $977 million in the previous year[28]

Core Insights - STRATA Skin Sciences, Inc. reported a modest revenue increase of 1% year-over-year for Q1 2025, totaling $6.8 million, with gross margins improving significantly by nearly 800 basis points to 53.5% [6][10][24] - The company has successfully executed its direct-to-consumer strategy, resulting in a 32% increase in unique psoriasis patients and a 128% increase in unique acne patients compared to the prior year [4] - International revenue grew by 8% in Q1 2025, contributing to 36% of total revenue, and is expected to continue growing as global tariff uncertainties resolve [5] Financial Performance - Revenue for Q1 2025 was $6.8 million, a 1% increase from Q1 2024, with global recurring revenue at $4.7 million and equipment revenue at $2.1 million, both up approximately 1% [6][10] - Gross profit for Q1 2025 was $3.6 million, representing 53.5% of revenue, compared to $3.1 million or 45.6% of revenue in Q1 2024 [6][24] - Total operating expenses decreased by 5% to $5.7 million, with significant reductions in engineering and product development expenses by 60% [7][24] Loss and Cash Position - The net loss for Q1 2025 was $2.4 million, or a loss per share of $0.58, an improvement from a net loss of $3.4 million or $0.96 per share in Q1 2024 [7][24] - Cash, cash equivalents, and restricted cash at the end of Q1 2025 were $7.8 million, down from $8.6 million at the beginning of the period [8][26] Strategic Developments - The company is focused on enhancing its direct-to-consumer marketing efforts and building a strong franchise in dermatology and aesthetics [20] - STRATA's partnership program offers innovative treatment technologies with a fee-per-treatment cost structure, which is expected to drive further growth [19][18]

Core Insights - STRATA Skin Sciences, Inc. will participate in the D. Boral Capital Inaugural Global Conference on May 14, 2025, at The Plaza Hotel in New York City [1] - Dr. Dolev Rafaeli, President and CEO, will host one-on-one meetings during the conference from 9:00 AM to 3:00 PM (ET) [2] Company Overview - STRATA Skin Sciences is focused on developing, commercializing, and marketing innovative products for treating dermatologic conditions such as psoriasis, vitiligo, and acne [3] - The company's product offerings include the XTRAC excimer laser, VTRAC lamp systems, and the TheraClearX Acne Therapy System [3] Partnership Program - STRATA offers a unique Partnership Program in the U.S., which includes a fee per treatment cost structure instead of requiring equipment purchase [4] - The program provides on-site training for practice personnel, service and maintenance of equipment, dedicated account and customer service associates, and co-op advertising support [4]

Core Viewpoint - STRATA Skin Sciences, Inc. will report its first quarter 2025 financial results on May 14, 2025, after market close [1] Group 1: Financial Results Announcement - The financial results will be followed by a conference call at 5:00 p.m. ET on the same day to review the results and provide updates on corporate developments [2] - Interested parties can join the conference call via domestic and international dialing options, with a recommendation to join 10 minutes early [3] Group 2: Replay Information - A telephonic replay of the call will be available until May 21, 2025, with specific dialing instructions provided [4] - A webcast replay will be accessible approximately one hour after the live call and will remain available until September 21, 2025 [4] Group 3: Company Overview - STRATA Skin Sciences is focused on developing and marketing innovative products for dermatologic conditions, including psoriasis, vitiligo, and acne [5] - The company offers products such as the XTRAC excimer laser, VTRAC lamp systems, and the TheraClearX Acne Therapy System [5] Group 4: Partnership Program - STRATA employs a unique Partnership Program that includes a fee per treatment cost structure, on-site training, service and maintenance, and co-op advertising support [6]

Financial Data and Key Metrics Changes - Total revenue for Q4 2024 was $9.6 million, an increase of 10% from $8.7 million in Q4 2023 [20] - Gross profit increased to $5.8 million in Q4 2024, up from $4.8 million in the year-ago quarter, with gross margins improving to 60.1% from 55.3% [21] - Operating loss improved by 68% compared to Q4 2023, adjusted for non-cash impairment charges [12] Business Line Data and Key Metrics Changes - Average net revenue per XTRAC device increased by 11% over the previous quarter and 6% over the prior year [10] - Equipment revenue was $3.8 million in Q4 2024, compared to $3.1 million in Q4 2023, driven by strong capital sales in international markets [20] - Gross domestic revenue billings in Q4 were $4.9 million, marking the third consecutive quarter of sequential increase [13] Market Data and Key Metrics Changes - International sales reached $4.1 million in Q4 2024, up 27% from Q3 2024 and up 41% from Q4 2023, representing the highest level of international sales to date [15] - The installed base of TheraClearX devices in the U.S. increased to 144 by the end of Q4 2024, up from 92 at the end of 2023 [14] Company Strategy and Development Direction - The company is focusing on improving the utilization of its machines by removing underperforming units and assisting higher-performing accounts [10] - The strategy includes enhancing direct-to-consumer advertising and in-clinic processes to drive patient appointments and revenue growth [12][13] - The company aims to stabilize financial performance and drive growth through strategic initiatives laid out at the beginning of 2024 [24] Management's Comments on Operating Environment and Future Outlook - Management noted a strong seasonal effect between Q4 and Q1, with Q1 typically being the weakest quarter [17] - The company is optimistic about continued progress in 2025, supported by its current financial position and strategic goals [22][23] Other Important Information - The company secured preauthorization for over 3,700 patients with acne in partner clinics year-to-date [14] - The cash position as of December 31, 2024, was $8.6 million, which includes $1.3 million of restricted cash [22] Q&A Session Summary Question: Clarification on TheraClearX device numbers - Management confirmed that 108 of the 144 TheraClearX devices are in accounts that are billing insurance [27] Question: Types of practices and geographical presence for TheraClearX - Initial uptake was stronger in the Northeast, primarily among small- to medium-sized groups [32] Question: Strength of international markets - Key international markets include Japan, China, South Korea, and the Middle East, with strong growth driven by technology appreciation and clinical efficacy [36][38] Question: Criteria for identifying underutilized accounts - Management explained that approximately 10% of accounts are churned annually based on performance metrics [49] Question: Determining new clinics for device placement - New accounts are identified based on historical patient treatment numbers and previous relationships with the company [60]