Nephros(US:NEPH)2025-11-06 21:01Financial Performance - Total net revenues for Q3 2025 increased by 35% to $4,764,000 compared to $3,518,000 in Q3 2024[107] - Operating income increased by 52% to $314,000 compared to $206,000 in the previous year[107] - Net income for Q3 2025 was $337,000, an 84% increase from $183,000 in Q3 2024[107] - Net revenues increased by $1.2 million, or 35%, for the three months ended September 30, 2025, driven by higher programmatic revenue and service revenue growth[108] - Total net revenues for the nine months ended September 30, 2025, increased by $3.8 million, or 37%, compared to the same period in 2024, driven by programmatic and emergency response revenue growth[116] Gross Margin - Gross margin remained stable at 61%, with a gross margin increase of 36% to $2,915,000 from $2,149,000[107] - Gross margin was approximately 61% for the three months ended September 30, 2025, consistent with the same period in 2024[109] - Gross margin increased to approximately 63% for the nine months ended September 30, 2025, compared to approximately 61% for the same period in 2024[117] Expenses - Research and development expenses rose by 80% to $338,000, up from $188,000, indicating a focus on innovation[107] - Selling, general and administrative expenses increased by approximately $508,000, or 30%, for the three months ended September 30, 2025, primarily due to higher sales commissions and employee bonuses[110] - Research and development expenses increased approximately $150,000, or 80%, due to higher employee bonuses and salary expenses[111] - Selling, general and administrative expenses increased by $880,000, or 15%, for the nine months ended September 30, 2025, due to higher sales commissions and employee bonuses[118] - Research and development expenses increased by $290,000, or 44%, primarily due to higher employee bonuses and salary expenses[119] Cash Flow - Net cash provided by operating activities was $1.4 million for the nine months ended September 30, 2025, compared to net cash used in operating activities of approximately $1.8 million for the same period in 2024[127] - Cash and cash equivalents increased to $5.171 million as of September 30, 2025, compared to $3.760 million as of December 31, 2024[124] Product Development and Market Expansion - The company’s ultrafilters and microfilters are FDA 510(k)-cleared Class II medical devices, ensuring validated performance in critical-use environments[79] - Nephros has expanded its product portfolio with a new solution for Total PFAS reduction, addressing emerging waterborne contaminants[80] - The company anticipates growth in commercial markets, particularly in food service and hospitality sectors, following a new supply agreement with Donastar[97] - Nephros filters are increasingly relevant in schools and federally regulated facilities due to their Total PFAS reduction capabilities[86] - The company expects future revenue from the commercial market to potentially surpass its infection control revenue as demand for water testing and filtration grows[99]