Financial Performance - Total revenue for 2024 was $15,031,000, representing a 8.9% increase from $13,801,000 in 2023[432]. - Product revenue increased to $7,874,000 in 2024, up 25.6% from $6,270,000 in 2023[432]. - Service revenue decreased to $7,157,000 in 2024, down 5% from $7,531,000 in 2023[432]. - Gross profit for 2024 was $9,019,000, compared to $8,271,000 in 2023, reflecting a gross margin improvement[432]. - Operating loss narrowed to $11,171,000 in 2024 from $17,296,000 in 2023[432]. - Net loss for 2024 was $11,136,000, an improvement from a net loss of $13,583,000 in 2023[432]. - The basic and diluted net loss per share for 2024 was $2.22, compared to $11.14 in 2023, showing a substantial improvement[564]. Cash and Assets - Cash and cash equivalents increased to $6,260,000 at the end of 2024, up from $1,643,000 at the end of 2023[438]. - Total assets grew to $15,284,000 in 2024, compared to $10,730,000 in 2023, indicating a significant increase in the company's asset base[430]. - Total stockholders' equity rose to $7,954,000 in 2024 from $411,000 in 2023, reflecting improved financial health[430]. - As of December 31, 2024, the company had approximately $6.3 million in cash and cash equivalents, which is insufficient to fund operations over the next twelve months[499]. Revenue Sources and Business Model - A substantial portion of future revenue is expected to derive from sales of appliances and treatments through a new strategic alliance and acquisition model[17]. - The company expects to derive a significant portion of future revenue from sales through Dental Service Organizations (DSOs) and Medical Service Organizations (MSOs)[17]. - The company is pivoting its business strategy to focus on contractual alliances with OSA healthcare providers, moving away from dependence on dentist sales[448]. - Revenue from MyoCorrect services is recognized over a 12-month performance period as therapy sessions occur[462]. - Revenue from appliance sales is recognized when control is transferred to the VIP, with product revenue recorded upon shipment to the VIP[468]. Regulatory and Operational Risks - The company faces risks related to government regulations and the need to obtain regulatory approvals for its products[20]. - The company is subject to extensive governmental regulation that could prevent it from manufacturing or obtaining Vivos appliances or introducing new products[20]. - The company has identified material weaknesses in internal controls, which may result in material misstatements of consolidated financial statements[17]. - The company may not be able to protect its patents and proprietary technology, exposing it to intellectual property claims or litigation[20]. Equity and Financing - The weighted average number of shares outstanding increased to 5,019,886 in 2024 from 1,219,381 in 2023, indicating significant equity financing activity[432]. - The company raised equity capital in late 2023 and throughout 2024 to address cash needs and bolster stockholders' equity for Nasdaq compliance[500]. - The company closed a private placement on November 2, 2023, raising $4.0 million by selling 130,000 shares and warrants, with issuance costs of approximately $0.5 million[518]. - The December 2024 Offering raised approximately $3.5 million, with offering expenses of about $0.5 million[535]. Customer and Supplier Dynamics - The company relies on five suppliers for approximately 57% of total purchases, indicating a significant supplier concentration risk[571]. - No single customer accounted for more than 10% of sales or accounts receivable, demonstrating a diversified customer base[570]. Research and Development - Research and development costs incurred were approximately $0.1 million for both years ended December 31, 2024 and 2023[485]. Employee and Compensation - The company entered into an employment agreement with Dr. Scott Simonetti for an annual salary of approximately $0.1 million and a five-year warrant for 16,000 shares at an exercise price of $15.25, contingent on achieving specific FDA milestones[516]. - For the year ended December 31, 2024, share-based compensation expense was approximately $0.8 million, down from $1.1 million in 2023[544].
Vivos Therapeutics(VVOS) - 2024 Q4 - Annual Report