Venus cept (VERO) - 2025 Q2 - Quarterly Results

Venus Concept Q2 2025 Earnings Release Overview and Management Commentary Venus Concept reported a 5% YoY revenue decline to $15.7 million in Q2 2025, while executing strategic initiatives to strengthen its balance sheet and focus on core medical aesthetics Q2 2025 Key Financial Highlights | Metric | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Total Revenue | $15.7 million | $16.6 million | -5% | | U.S. Revenue | $9.7 million | $9.3 million | +5% | | GAAP Net Loss | $11.7 million | $19.9 million | Improved | | Adjusted EBITDA Loss | $8.8 million | $4.1 million | Worsened | - Management emphasized strong execution with 20% quarter-over-quarter growth in total systems and subscription sales, and year-over-year growth in the US business[4] - The company has been actively improving its capital structure through multiple transactions, including debt-to-equity exchanges totaling $17.5 million and raising $3.9 million in gross proceeds from equity offerings[4][5] - A definitive agreement was signed to sell the Venus Hair business to MHG Co. Ltd in a $20 million all-cash transaction, expected to improve revenue growth, lower operating expenses, and accelerate the path to profitability by allowing focus on the global medical aesthetics business[4][5] Second Quarter 2025 Financial Performance Q2 2025 saw a 5% YoY revenue decline to $15.7 million, a 20% drop in gross profit, and a 6% rise in operating expenses, yet net loss improved to $11.7 million Revenue Analysis Q2 2025 total revenue decreased 5.4% to $15.7 million, driven by an 18% international decline, partially offset by a 5% increase in U.S. revenue Q2 2025 Revenue by Region (in thousands) | Region | Q2 2025 (in thousands) | Q2 2024 (in thousands) | YoY Change | | :--- | :--- | :--- | :--- | | United States | $9,727 | $9,280 | +5% | | International | $5,965 | $7,302 | -18% | | Total Revenue | $15,692 | $16,582 | -5% | Q2 2025 Revenue by Product (in thousands) | Product Category | Q2 2025 (in thousands) | Q2 2024 (in thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Venus Prime / Subscription—Systems | $4,681 | $4,517 | +3.6% | | Products—Systems | $7,939 | $8,588 | -7.6% | | Products—Other | $2,444 | $2,647 | -7.7% | | Services | $628 | $830 | -24.3% | | Total | $15,692 | $16,582 | -5.4% | Profitability Analysis Q2 2025 gross profit fell 20% to $9.4 million, with margins at 60.1%, while operating expenses rose 6% to $18.5 million, yet net loss per share improved to $8.03 - Gross profit decreased by $2.4 million (20%) YoY, with gross margin declining from 71.5% to 60.1%, primarily due to customer economic uncertainty, tighter lending practices, and supply disruptions from the Israel-Iran conflict[8] Q2 2025 Operating Expenses (in millions) | Expense Category | Q2 2025 (in millions) | Q2 2024 (in millions) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Selling and marketing | $7.7 | $7.0 | +9% | | General and administrative | $9.4 | $8.7 | +9% | | Research and development | $1.4 | $1.7 | -22% | | Total Operating Expenses | $18.5 | $17.4 | +6% | Q2 2025 Loss Summary | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Operating Loss | $(9.0) million | $(5.6) million | | Net Loss Attributable to Stockholders | $(11.7) million | $(20.0) million | | Net Loss Per Share | $(8.03) | $(30.93) | Financial Position As of June 30, 2025, cash and cash equivalents stood at $4.9 million, with total debt at $34.3 million, reflecting an improved financial position from year-end 2024 Cash and Debt Position (in millions) | Metric | June 30, 2025 (in millions) | Dec 31, 2024 (in millions) | | :--- | :--- | :--- | | Cash and cash equivalents | $4.9 | $4.3 | | Total debt obligations | $34.3 | $39.7 | Fiscal Year 2025 Financial Outlook Venus Concept is not providing a fiscal year 2025 financial outlook due to ongoing lender discussions, strategic evaluations, and potential trade disruptions - The Company is not providing financial guidance at this time due to active dialogue with lenders, ongoing evaluation of strategic alternatives, and assessment of potential trade disruptions[13] Consolidated Financial Statements This section presents the condensed consolidated balance sheets, statements of operations, and cash flows, detailing the company's financial position and performance Condensed Consolidated Balance Sheets As of June 30, 2025, total assets were $63.1 million, liabilities $60.3 million, and equity $2.8 million, with a significant reduction in long-term debt Balance Sheet Summary (in thousands) | Account | June 30, 2025 (in thousands) | Dec 31, 2024 (in thousands) | | :--- | :--- | :--- | | Total Current Assets | $45,108 | $48,512 | | Total Assets | $63,085 | $68,184 | | Total Current Liabilities | $41,118 | $30,287 | | Total Liabilities | $60,313 | $65,346 | | Total Stockholders' Equity | $2,772 | $2,838 | - Long-term debt was significantly reduced to $15.9 million as of June 30, 2025, from $31.4 million at the end of 2024[20] Condensed Consolidated Statements of Operations For Q2 2025, net loss improved to $11.7 million on $15.7 million revenue, and for the six months, net loss was $24.1 million, an improvement from the prior year Statement of Operations Summary (in thousands, except per share data) | 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 | | :--- | :--- | :--- | :--- | :--- | | Total Revenue | $15,692 | $16,582 | $29,335 | $34,061 | | Gross Profit | $9,431 | $11,849 | $18,186 | $23,496 | | Loss from Operations | $(9,041) | $(5,596) | $(18,569) | $(13,356) | | Net Loss | $(11,742) | $(19,864) | $(24,108) | $(29,653) | | Net Loss Per Share (Basic) | $(8.03) | $(30.93) | $(22.18) | $(48.60) | Condensed Consolidated Statements of Cash Flows For the six months ended June 30, 2025, net cash used in operations was $11.8 million, while financing activities provided $12.5 million, leading to a $0.6 million net cash increase Cash Flow Summary for Six Months Ended June 30 (in thousands) | Activity | 2025 (in thousands) | 2024 (in thousands) | | :--- | :--- | :--- | | Net cash used in operating activities | $(11,758) | $(4,210) | | Net cash used in investing activities | $(197) | $(47) | | Net cash provided by financing activities | $12,549 | $4,593 | | Net increase in cash | $594 | $336 | - Financing activities in the first six months of 2025 included $3.3 million from registered direct offerings and $9.3 million from short-term bridge financing[24] Non-GAAP Financial Measures Adjusted EBITDA, a non-GAAP measure, showed an $8.8 million loss in Q2 2025, a deterioration from Q2 2024, with reconciliation detailing various adjustments from net loss - Adjusted EBITDA is defined as net income (loss) adjusted for foreign exchange, financial expenses, taxes, depreciation, amortization, stock-based compensation, and other non-recurring items[25] Reconciliation of Net Loss to Adjusted EBITDA (in thousands) | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :--- | :--- | :--- | :--- | :--- | | Net Loss | $(11,742) | $(19,864) | $(24,108) | $(29,653) | | Adjusted EBITDA | $(8,845) | $(4,142) | $(17,190) | $(9,260) |