Vericel (VCEL) FY 2025 Conference September 04, 2025 03:45 PM ET Speaker2Team here at Wells Fargo. I'm joined today by Nick Colangelo, President and CEO of Vericel, as well as Joe Mara, Chief Financial Officer at Vericel. Thanks very much for joining us today.Speaker1Great. Thanks, good to be here.Speaker2Thanks. Great. Nick, I thought maybe we could start with just to kind of level set those that are perhaps a little newer to the story, if you could start by giving kind of a brief overview of the company a ...

CAMBRIDGE, Mass., Aug. 28, 2025 (GLOBE NEWSWIRE) -- Vericel Corporation (NASDAQ:VCEL), a leader in advanced therapies for the sports medicine and severe burn care markets, today announced that the Company will participate in a fireside chat at the Wells Fargo Healthcare Conference at 3:45 p.m. ET on Thursday, September 4, 2025. A webcast of the presentation will be available on the Investor Relations section of the Vericel Corporation website at: http://investors.vcel.com. About Vericel Corporation Vericel ...

Core Insights - Vericel reported a 20% year-over-year GAAP revenue growth in Q2 2025, reaching $63.2 million, driven by its MACI franchise, despite missing analyst expectations of $64.5 million [1][2] - The company achieved a gross margin of 74%, an increase of 4 percentage points from the previous year, and narrowed its net loss per share to $0.01, outperforming the estimated loss of $0.03 [1][2][8] Financial Performance - Revenue for Q2 2025 was $63.2 million, up from $52.7 million in Q2 2024, reflecting a 20% increase [2] - Adjusted EBITDA (Non-GAAP) reached $13.4 million, a 112% increase from $6.3 million in Q2 2024 [2] - Operating cash flow was reported at $8.2 million, with cash reserves of approximately $164 million and no long-term debt [2][8] Product Performance - MACI, the cartilage repair implant, generated $53.5 million in revenue, a 21% increase year-over-year, and saw a significant rise in biopsies, indicating future revenue potential [5][6] - In burn care, Epicel and NexoBrid generated revenues of $8.6 million and $1.2 million, respectively, with Epicel revenue increasing from $7.8 million and NexoBrid growing by 52% from $0.8 million [7] Business Strategy - The company is focused on expanding the usage of its products, training more physicians, and enhancing delivery methods, such as the new arthroscopic technique for MACI [4][6] - Management plans to expand the MACI sales force in the second half of 2025 to align with expected demand and surgeon training momentum [11] Market Outlook - Management expects full-year MACI revenue growth in the low 20% range and a stable run rate of approximately $10 million per quarter for burn care in the second half of 2025 [12] - Vericel received FDA clearance for a Phase 3 study of MACI for ankle cartilage repair, potentially opening a new market worth an estimated $1 billion annually [11]

Financial Data and Key Metrics Changes - Total revenue increased by 20% in the second quarter, reaching $63.2 million, with gross margin expanding over 400 basis points to 74% [5][12][16] - Adjusted EBITDA rose by 112% year-over-year to over $13.4 million, representing 21% of revenue, an increase of more than 900 basis points compared to the previous year [5][17] - Net loss narrowed to $600,000 or $0.01 per share, an improvement of over $4 million compared to the prior year [17] Business Line Data and Key Metrics Changes - MACI generated record revenue of nearly $54 million, reflecting a 21% increase year-over-year and 15% sequential growth [5][12] - Epicel revenue was $8.6 million, representing an 11% growth year-over-year, with biopsies increasing nearly 40% [14][15] - NexoBrid revenue reached $1.2 million, showing a 52% growth compared to the prior year [15] Market Data and Key Metrics Changes - MACI biopsy growth rates outpaced implant growth, with expectations for convergence in the second half of the year [6][7] - The treatment of small femoral condyle defects increased by 40% year-over-year, indicating strong market potential [7][8] - Epicel's performance rebounded with the highest monthly biopsies recorded in June [9][10] Company Strategy and Development Direction - The company plans to expand its MACI sales force from 76 to approximately 100 territories to support anticipated growth [8][10] - FDA clearance for the Phase III MACI Ankle clinical study was received, representing a significant long-term growth opportunity [10][11] - The company is focused on maintaining strong revenue and profitability growth while preparing for international expansion, particularly in Europe [85] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong underlying business fundamentals and growth drivers for MACI and burn care products [5][20] - The company is optimistic about the third quarter, citing strong momentum from both MACI and burn care products [10][20] - Management acknowledged challenges in predicting Epicel revenue due to patient health-related issues but remains hopeful for improved performance [39][40] Other Important Information - The company ended the second quarter with approximately $164 million in cash and investments and no debt [17] - The company is not assuming additional NexoBrid revenue related to the BARDA RFP process but sees potential for incremental revenue in the fourth quarter [18][19] Q&A Session Summary Question: What impacted MACI growth in Q2? - Management noted that Q2 revenue was slightly below expectations due to timing issues with some implants moving into July, but overall metrics remain strong [24][25] Question: How many arthrobiopsies have converted to MACI? - Management did not disclose specific conversion rates but indicated that trends are in line with expectations [28][29] Question: What is the new reality for Epicel guidance? - Management explained that while biopsies were up significantly, patient health issues have affected revenue, leading to a more conservative guidance for the second half of the year [32][34] Question: Can you discuss the BARDA RFP? - Management confirmed that the RFP is in the public domain, with proposals due in late August, and initial procurement would be for 2,750 units [92][93]

Financial Data and Key Metrics Changes - Total revenue increased by 20% in Q2 2025, reaching $63.2 million, with gross margin expanding over 400 basis points to 74% [4][12] - Adjusted EBITDA rose by 112% year-over-year to over $13.4 million, representing 21% of revenue, an increase of more than 900 basis points compared to the previous year [4][17] - Net loss narrowed to $600,000 or $0.01 per share, an improvement of over $4 million compared to the prior year [17] Business Line Data and Key Metrics Changes - MACI generated record revenue of nearly $54 million in Q2, reflecting a 21% increase year-over-year and 15% sequential growth [4][12] - Epicel revenue was $8.6 million, representing an 11% growth year-over-year, with biopsies increasing nearly 40% compared to the prior year [12][14] - NexoBrid revenue reached $1.2 million, showing a 52% increase year-over-year, with strong growth in hospital unit orders [14] Market Data and Key Metrics Changes - MACI's performance was driven by strong growth in the surgeon base and biopsy volumes, with the second highest number of MACI biopsies recorded since launch [5][6] - The treatment of small femoral condyle defects increased by 40% year-over-year, indicating potential for significant growth in this segment [6][10] - Epicel's biopsies were the highest in any quarter since 2023, with a strong start in Q3 [9][10] Company Strategy and Development Direction - The company plans to expand its MACI sales force from 76 to approximately 100 territories to support anticipated high volumes in Q4 2025 [8][10] - FDA clearance for the Phase III MACI Ankle clinical study was received, representing a substantial long-term growth driver for MACI [10][11] - The company is also on track to initiate commercial manufacturing for MACI in a new facility next year [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong underlying business fundamentals and growth drivers for MACI and burn care products [4][20] - The company is well-positioned for a strong second half of the year, with expectations for continued revenue and profitability growth [10][20] - Management acknowledged challenges in predicting Epicel quarterly revenue due to patient health-related issues but remains optimistic about future performance [38][40] Other Important Information - The company ended Q2 with approximately $164 million in cash and investments and no debt, enhancing its financial profile [17] - The guidance for MACI revenue growth for the full year remains in the low 20% range, with updates to burn care revenue guidance reflecting recent run rates [18][19] Q&A Session Summary Question: What is impacting MACI growth guidance? - Management noted that Q2 revenue was slightly below expectations but emphasized strong underlying indicators and expected acceleration in growth moving forward [24][25] Question: How many arthrobiopsies have converted to MACI? - Management stated they do not disclose specific conversion rates but indicated that trends are in line with expectations [28][29] Question: What is the new reality for Epicel guidance? - Management explained that while biopsies were up significantly, patient health issues have impacted revenue, leading to a more conservative guidance approach [32][34] Question: Can you comment on international expansion opportunities? - The company is prioritizing Europe for expansion and expects to have a roadmap for international opportunities by the end of the year [83][84] Question: What is the BARDA RFP about? - The RFP involves procurement for stockpiling and includes multiple funding opportunities, with proposals due in late August [92][93]

[PART I - FINANCIAL INFORMATION](index=3&type=section&id=PART%20I%20-%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20%28Unaudited%29) Unaudited financial statements for Q2 2025 show total revenues of **$63.2 million** and **$115.8 million** for the six-month period, with a net loss of **$0.55 million** for the quarter [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets increased slightly to **$435.6 million**, total liabilities decreased to **$128.8 million**, and shareholders' equity grew to **$306.8 million** Balance Sheet Summary (in thousands) | Balance Sheet Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $80,532 | $74,520 | | Total current assets | $204,577 | $212,777 | | Total assets | $435,608 | $432,722 | | **Liabilities & Equity** | | | | Total current liabilities | $41,132 | $50,286 | | Total liabilities | $128,799 | $140,755 | | Total shareholders' equity | $306,809 | $291,967 | [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Q2 2025 total revenue increased **20.1%** to **$63.2 million**, with gross profit up **27.4%**, significantly narrowing net loss to **$0.55 million** from **$4.7 million** in Q2 2024 Q2 2025 vs Q2 2024 Statement of Operations (in thousands) | Metric | Q2 2025 | Q2 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Total revenue | $63,240 | $52,662 | +20.1% | | Gross profit | $46,613 | $36,601 | +27.4% | | Total operating expenses | $48,642 | $42,632 | +14.1% | | Loss from operations | ($2,029) | ($6,031) | +66.4% | | Net loss | ($553) | ($4,682) | +88.2% | | Net loss per share | ($0.01) | ($0.10) | +90.0% | Six Months 2025 vs 2024 Statement of Operations (in thousands) | Metric | H1 2025 | H1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Total revenue | $115,838 | $103,943 | +11.4% | | Gross profit | $82,886 | $71,955 | +15.2% | | Total operating expenses | $97,707 | $83,450 | +17.1% | | Loss from operations | ($14,821) | ($11,495) | -28.9% | | Net loss | ($11,799) | ($8,544) | -38.1% | | Net loss per share | ($0.24) | ($0.18) | -33.3% | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash provided by operating activities for H1 2025 was **$14.8 million**, with net cash used in investing activities at **$24.2 million**, resulting in a **$4.5 million** decrease in total cash Six-Month Cash Flow Summary (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $14,814 | $25,737 | | Net cash used in investing activities | ($24,170) | ($43,171) | | Net cash provided by financing activities | $4,839 | $6,422 | | **Net decrease in cash** | **($4,517)** | **($11,012)** | - Expenditures for property and equipment were **$22.3 million** for the first six months of **2025**, compared to **$30.8 million** in the same period of **2024**[17](index=17&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail the company's products (**MACI**, **Epicel**, **NexoBrid**), revenue breakdown by product, and confirm sufficient liquidity for the next **12 months** - The company markets three products: **MACI** (cartilage repair), **Epicel** (severe burn care), and **NexoBrid** (eschar removal in burn patients)[20](index=20&type=chunk)[21](index=21&type=chunk) - In August **2024**, the **FDA** approved **MACI Arthro™**, allowing for arthroscopic delivery of the **MACI** implant, which became commercially available in Q3 **2024**[20](index=20&type=chunk) Revenue by Product (in thousands) | Product | Q2 2025 | Q2 2024 | Change (%) | H1 2025 | H1 2024 | Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | MACI | $53,458 | $44,135 | +21.1% | $99,755 | $84,316 | +18.3% | | Epicel | $8,614 | $7,758 | +11.0% | $13,578 | $18,422 | -26.3% | | NexoBrid | $1,168 | $769 | +51.9% | $2,505 | $1,205 | +107.9% | | **Total** | **$63,240** | **$52,662** | **+20.1%** | **$115,838** | **$103,943** | **+11.4%** | - The company has a **$150.0 million** five-year senior secured revolving credit agreement, with no outstanding borrowings as of June **30**, **2025**[60](index=60&type=chunk)[62](index=62&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=21&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes Q2 revenue growth to increased **MACI** volume and price, alongside **Epicel** and **NexoBrid** growth, and confirms sufficient liquidity for the next **12 months** [Overview](index=21&type=section&id=Overview) **Vericel** is a biopharmaceutical company focused on sports medicine and severe burn care, with **MACI Arthro™** expected to drive growth by expanding the target surgeon base - The company believes the availability of **MACI Arthro** provides a significant growth opportunity and has expanded its target surgeon base from **5,000** to **7,000**[94](index=94&type=chunk) - **Vericel** plans to initiate a clinical trial for **MACI** use in the ankle beginning in **2025**, which it views as a significant long-term growth driver[94](index=94&type=chunk) - The company is monitoring the conflict in the Middle East as its supplier for **NexoBrid**, **MediWound**, has manufacturing facilities in Israel, but does not currently anticipate a material disruption to supply[84](index=84&type=chunk)[85](index=85&type=chunk) [Results of Operations](index=24&type=section&id=Results%20of%20Operations) Q2 **2025** total revenue increased **20.1%** to **$63.2 million**, driven by **MACI**, **Epicel**, and **NexoBrid** growth, while SG&A expenses rose due to headcount and marketing Q2 2025 vs Q2 2024 Revenue by Product (in thousands) | Product | Q2 2025 | Q2 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | MACI | $53,458 | $44,135 | $9,323 | 21.1% | | Epicel | $8,614 | $7,758 | $856 | 11.0% | | NexoBrid | $1,168 | $769 | $399 | 51.9% | | **Total** | **$63,240** | **$52,662** | **$10,578** | **20.1%** | - The increase in SG&A expenses for Q2 and H1 **2025** was primarily due to higher headcount and employee expenses, increased marketing programs, and facility costs for the new **Burlington** facility[107](index=107&type=chunk)[108](index=108&type=chunk) - R&D expenses decreased in Q2 **2025** compared to Q2 **2024**, mainly due to higher costs related to the **MACI Arthro** project in **2024**[105](index=105&type=chunk) [Liquidity and Capital Resources](index=26&type=section&id=Liquidity%20and%20Capital%20Resources) As of June **30**, **2025**, the company had **$80.5 million** in cash and **$83.7 million** in investments, with management confirming sufficient liquidity for at least the next **12 months** - The company had **$80.5 million** in cash and cash equivalents, plus **$83.7 million** in investments as of June **30**, **2025**[112](index=112&type=chunk) - Management believes current cash, investments, and available borrowing capacity will be sufficient to support operations for at least **12 months** from the report's issuance[119](index=119&type=chunk) - The company has a **$150.0 million** five-year senior secured revolving credit agreement available for working capital and general corporate purposes, with no outstanding borrowings[121](index=121&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=29&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company states that its exposures to market risk have not changed materially since December **31**, **2024** - There have been no material changes in the company's market risk exposures since the end of the last fiscal year[126](index=126&type=chunk) [Item 4. Controls and Procedures](index=29&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June **30**, **2025**, with no material changes in internal control over financial reporting - The company's Certifying Officers concluded that disclosure controls and procedures were effective as of June **30**, **2025**[127](index=127&type=chunk) - No material changes were made to the company's internal control over financial reporting during the second quarter of **2025**[129](index=129&type=chunk) [PART II — OTHER INFORMATION](index=29&type=section&id=PART%20II%20%E2%80%94%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=29&type=section&id=Item%201.%20Legal%20Proceedings) The company reports that it is not currently a party to any material legal proceedings - As of the filing date, **Vericel** is not involved in any material legal proceedings[130](index=130&type=chunk) [Item 1A. Risk Factors](index=29&type=section&id=Item%201A.%20Risk%20Factors) The company highlights a specific risk related to potential disruptions at the **FDA** due to inadequate funding and personnel changes, which could delay regulatory approvals - The company identifies a risk that inadequate funding and potential disruptions at the **FDA** could delay the review and approval of new products or product changes[132](index=132&type=chunk) - Potential disruptions at the **FDA** could specifically impact the review of submissions for the **MACI** Ankle clinical trial, for which enrollment is expected to begin in the second half of **2025**[133](index=133&type=chunk) - The change in presidential administration in **2025** creates uncertainty regarding **FDA** policies and regulations, which could prevent, limit, or delay regulatory approvals[135](index=135&type=chunk) [Item 5. Other Information](index=30&type=section&id=Item%205.%20Other%20Information) Three Section **16** officers or directors adopted **Rule 10b5-1** trading plans for the potential sale of company common stock during Q2 **2025** - Three insiders adopted **Rule 10b5-1** trading plans during the quarter ended June **30**, **2025**: - **Kevin McLaughlin** (Director): Potential sale of up to **35,000** shares - **Robert Zerbe** (Chairman): Potential sale of up to **7,500** shares - **Jonathan Hopper** (CMO): Potential sale of up to **37,847** shares[139](index=139&type=chunk) [Item 6. Exhibits](index=32&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed as part of the Quarterly Report on Form **10-Q**, including certifications by the CEO and CFO

Financial Performance - Total Q2 Revenue reached $63.2 million[6], with MACI contributing $53.5 million[6], Epicel $8.6 million[6], and NexoBrid $1.2 million[6] - MACI revenue experienced a growth of 21% reaching $53.5 million[10] - Gross margin increased to 74%, up over 400 bps compared to Q2 2024[10] - Adjusted EBITDA increased by 112% to $13.4 million[10] - The company holds $164 million in cash and investments[10] Business Highlights - Approximately 600 surgeons have been trained on MACI Arthro to date[10] - MACI implants for small femoral condyle defects increased by more than 40% in Q2 compared to the prior year[10] - NexoBrid second quarter revenue increased 52% vs prior year[10] - The company received FDA IND clearance for the MACI Ankle clinical study and remains on track to initiate the study in 2H 2025[10] MACI Arthro Launch - MACI Arthro trained surgeons continue to demonstrate expanded MACI utilization[14] - MACI implants for trochlea defects account for nearly 20% of MACI Arthro implants to date[14]

Q2 2025 Performance Overview [Financial Highlights](index=1&type=section&id=Second%20Quarter%202025%20Financial%20Highlights) The company reported strong Q2 2025 results with 20% revenue growth, significant margin expansion, and a 112% surge in adjusted EBITDA Financial Highlights | Metric | Q2 2025 | Growth vs. Q2 2024 | | :--- | :--- | :--- | | **Total Net Revenue** | $63.2 million | +20% | | **MACI Net Revenue** | $53.5 million | +21% | | **Burn Care Net Revenue** | $9.8 million | - | | - Epicel Revenue | $8.6 million | - | | - NexoBrid Revenue | $1.2 million | - | | **Gross Margin** | 74% | +400 bps | | **Net Loss** | ($0.6) million | Improved from ($4.7) million | | **Adjusted EBITDA** | $13.4 million | +112% | | **Adjusted EBITDA Margin** | 21% | +900 bps | - The company ended the quarter with a strong balance sheet, holding approximately **$164 million in cash and investments with no debt**[3](index=3&type=chunk)[12](index=12&type=chunk) - Operating cash flow for the second quarter was **$8.2 million**[3](index=3&type=chunk) [Business Highlights and Updates](index=2&type=section&id=Business%20Highlights%20and%20Updates) The company achieved key operational milestones, including FDA clearance for a new study and strong adoption across its product lines - Received **FDA Investigational New Drug (IND) clearance** for the MACI Ankle™ clinical study, which is on track to begin in the second half of 2025[2](index=2&type=chunk)[8](index=8&type=chunk) - Approximately **600 MACI Arthro™ surgeons have been trained** to date, indicating strong adoption[2](index=2&type=chunk)[8](index=8&type=chunk) - The company recorded the **second-highest number of MACI biopsies** in a quarter since launch and the highest number of Epicel biopsies since 2023[8](index=8&type=chunk) - NexoBrid revenue **increased 52% versus the prior year**, and June saw the highest number of hospital unit orders since launch[8](index=8&type=chunk) [2025 Financial Guidance](index=2&type=section&id=2025%20Financial%20Guidance) The company reaffirmed its full-year 2025 revenue growth and profitability targets while updating its Burn Care revenue guidance Full Year 2025 Outlook | Guidance Metric | Full Year 2025 Outlook | | :--- | :--- | | **MACI Revenue Growth** | Reaffirmed in the low 20% range | | **Burn Care Revenue (H2 2025)** | Updated to approx. $10 million per quarter | | **Gross Margin** | Reaffirmed at 74% | | **Adjusted EBITDA Margin** | Reaffirmed at 26% | Detailed Financial Statements [Consolidated Statements of Operations](index=6&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) The company's Q2 2025 revenue grew to $63.2 million, driving a significant reduction in net loss despite higher operating expenses Condensed Consolidated Statements of Operations | (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | **Total revenue** | $63,240 | $52,662 | | **Gross profit** | $46,613 | $36,601 | | **Total operating expenses** | $48,642 | $42,632 | | **Loss from operations** | ($2,029) | ($6,031) | | **Net loss** | ($553) | ($4,682) | | **Net loss per share** | ($0.01) | ($0.10) | - The increase in operating expenses was primarily driven by increased headcount, related employee expenses, and costs associated with the new Burlington facility, including depreciation and MACI tech transfer activities[10](index=10&type=chunk) [GAAP vs. Non-GAAP Reconciliation](index=7&type=section&id=RECONCILIATION%20OF%20REPORTED%20NET%20LOSS%20(GAAP)%20TO%20ADJUSTED%20EBITDA%20(NON-GAAP%20MEASURE)) Non-GAAP adjusted EBITDA increased to $13.4 million, with key adjustments including stock-based compensation and depreciation Reconciliation of Reported Net Loss (GAAP) to Adjusted EBITDA (Non-GAAP) | (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | **Net loss (GAAP)** | ($553) | ($4,682) | | Stock-based compensation | $10,140 | $9,520 | | Depreciation and amortization | $2,826 | $1,323 | | Pre-occupancy lease & tech transfer | $2,446 | $1,509 | | **Adjusted EBITDA (Non-GAAP)** | **$13,359** | **$6,313** | [Condensed Consolidated Balance Sheets](index=8&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) The company maintained a strong balance sheet with $435.6 million in total assets and a robust liquidity position Condensed Consolidated Balance Sheets | (in thousands) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Cash, cash equivalents & investments** | $164,281 | $156,093 | | **Total current assets** | $204,577 | $212,777 | | **Total assets** | $435,608 | $432,722 | | **Total current liabilities** | $41,132 | $50,286 | | **Total liabilities** | $128,799 | $140,755 | | **Total shareholders' equity** | $306,809 | $291,967 | Other Information [About Vericel Corporation](index=3&type=section&id=About%20Vericel%20Corporation) The company provides advanced therapies for sports medicine and severe burn care, with three key products marketed in the U.S - Vericel is a leading provider of advanced therapies for the sports medicine and severe burn care markets[15](index=15&type=chunk) - The company markets three products in the United States: **MACI®** (for knee cartilage defects), **Epicel®** (for severe burns), and **NexoBrid®** (for eschar removal in thermal burns)[15](index=15&type=chunk) [Forward-Looking Statements](index=4&type=section&id=Forward-Looking%20Statements) This section outlines potential risks and uncertainties that could cause actual results to differ from forward-looking statements - The company identifies several risk factors that could cause actual results to differ from forward-looking statements[18](index=18&type=chunk) - Key risks include uncertainties in future revenue, market penetration for products like MACI and NexoBrid, ability to scale manufacturing (including the new Burlington facility), and potential supply chain disruptions[19](index=19&type=chunk)[20](index=20&type=chunk)

Financial Performance - Total net revenue for Q2 2025 increased by 20% to $63.2 million compared to $52.7 million in Q2 2024 [7][9] - MACI net revenue grew by 21% to $53.5 million, while Burn Care net revenue was $9.8 million, consisting of $8.6 million from Epicel and $1.2 million from NexoBrid [7][9] - Gross margin improved by over 400 basis points to 74% from 70% in the prior year [10][7] - Adjusted EBITDA rose by 112% to $13.4 million, with an adjusted EBITDA margin increase of over 900 basis points to 21% [2][12] Business Highlights - Approximately 600 MACI Arthro surgeons have been trained to date [2] - The company received FDA IND clearance for the Phase 3 MACI Ankle clinical study, expected to initiate in the second half of 2025 [7][9] - The second quarter saw the second highest number of MACI biopsies since launch, with a more than 40% increase in MACI implants for small femoral condyle defects compared to the previous year [7][9] - Epicel biopsies reached the highest number in a quarter since 2023, representing a 38% growth year-over-year [7] Financial Guidance - The company reaffirmed MACI full-year revenue growth in the low 20% range and updated Burn Care revenue guidance for the second half of 2025 to approximately $10 million per quarter [8] - Full-year profitability guidance includes a gross margin of 74% and an adjusted EBITDA margin of 26% [8]

Company Overview - Vericel Corporation is a leader in advanced therapies for the sports medicine and severe burn care markets, combining innovations in biology with medical technologies to create a differentiated portfolio of cell therapies and specialty biologics [3] Upcoming Financial Results - Vericel will report its second-quarter 2025 financial results on July 31, 2025, with a conference call and webcast scheduled for 8:30 a.m. ET [1] - The live webcast can be accessed through the Investor Relations section of the Vericel website, and a replay will be available until July 31, 2026 [2] Product Portfolio - Vericel markets three main products in the United States: - MACI: An autologous cellularized scaffold product for repairing full-thickness cartilage defects in the knee [3] - Epicel: A permanent skin replacement for treating deep dermal or full-thickness burns covering 30% or more of total body surface area [3] - NexoBrid: A biological orphan product for eschar removal in burn patients, for which Vericel holds exclusive North American rights [3]