Envoy Medical(COCH) - 2025 Q3 - Quarterly Report

Financial Performance - For the three months ended September 30, 2025, the company reported a net loss of $6,482, compared to a net loss of $5,960 for the same period in 2024, and for the nine months ended September 30, 2025, the net loss was $17,170, compared to $16,177 in 2024[144]. - The company has an accumulated deficit of $305,659 as of September 30, 2025, up from $284,734 as of December 31, 2024[144]. - Net revenues for the three months ended September 30, 2025, were $42, a decrease of $14 or 25.0% compared to $56 in the same period of 2024[186]. - Net revenues decreased by $17, or 9.3%, for the nine months ended September 30, 2025, compared to the same period in 2024[198]. - Cash used in operating activities was $12,516 for the nine months ended September 30, 2025, primarily funding a net loss of $17,170[214]. - As of September 30, 2025, the company had $3,556 in cash, down from $5,483 at the end of 2024[209]. Clinical Trials and Regulatory Approvals - The FDA granted the Investigational Device Exemption (IDE) for the Acclaim CI in October 2024, allowing the company to begin a pivotal clinical study[140]. - The first stage of the clinical trial included 10 participants, and the FDA approved the expansion to a total of 56 participants on October 3, 2025[141][147]. - The second stage of the clinical trial for the Acclaim CI is currently underway, with the first three patients enrolled by October 31, 2025[148]. - The company anticipates obtaining FDA's decision on the Premarket Approval application in the second half of 2027, assuming no panel review is requested[142]. - The company is targeting FDA approval for the Acclaim CI in the second half of 2027 or first half of 2028[166]. Expenses and Costs - Cost of goods sold increased by $16 to $203 for the three months ended September 30, 2025, primarily due to increased material waste[188]. - Research and development expenses for the three months ended September 30, 2025, were $2,700, a slight decrease of $57 or 2.1% from $2,757 in 2024[186]. - General and administrative expenses rose by $752 or 44.5% to $2,442 for the three months ended September 30, 2025, compared to $1,690 in 2024[186]. - The operating loss for the three months ended September 30, 2025, was $5,708, an increase of $736 or 14.8% from a loss of $4,972 in 2024[186]. - The company expects R&D expenses to continue increasing as it initiates clinical trials for the Acclaim CI product[175]. - R&D expenses for the nine months ended September 30, 2025, increased by $225, with personnel costs up 5.2% and other R&D costs up 107.2%[200]. - Total costs and operating expenses increased by $1,161, or 7.8%, with general and administrative expenses rising by 17.7%[197]. Financing Activities - The company entered into a Securities Purchase Agreement on September 22, 2025, to issue 1,908,402 shares of Common Stock at a price of $1.31 per share[154]. - The September 2025 Offering generated gross proceeds of $2,500, with potential additional proceeds of $7,500 if warrants are fully exercised[156]. - The October 2025 Offering resulted in gross proceeds of $4,000, with potential additional proceeds of $12,000 from warrant exercises[160]. - Net cash provided by financing activities for the nine months ended September 30, 2025 was $10,593, resulting from proceeds from the issuance of Term Loans of $10,000[217]. Market and Economic Conditions - The company received a deficiency notification from Nasdaq regarding non-compliance with the market value listing requirement, with a grace period until February 23, 2026, to regain compliance[149][152]. - Macroeconomic conditions, including global conflicts and inflation, are impacting the company's financial performance and capital raising ability[162]. - The company is exposed to inflation risk, which may adversely affect operating results if selling prices do not increase in line with rising costs[237]. Miscellaneous - The gain from the change in the fair value of the forward purchase agreement warrant liability was $64, compared to a loss of $311 in the prior year[192]. - There were no customers accounting for 10% or more of sales for the three and nine months ended September 30, 2025 and 2024, indicating a diversified customer base[236]. - The company has not had any off-balance sheet arrangements during the periods presented, ensuring transparency in financial reporting[220]. - The estimated cost per unit for the product warranty is $6, with an average battery life of five years, impacting the liability recorded[229]. - The company has not experienced any material differences between accrued costs and actual costs incurred since inception, indicating effective cost estimation practices[227].