TELA Bio(US:TELA)2025-11-14 21:06Revenue Performance - Revenue increased by $1.7 million, or 9%, from $19.0 million for the three months ended September 30, 2024, to $20.7 million for the same period in 2025[117]. - Revenue for the nine months ended September 30, 2025, was $59.4 million, an increase of $7.8 million, or 15%, from $51.7 million for the same period in 2024[117]. - Revenue increased by $1.7 million, or 9%, to $20.7 million for the three months ended September 30, 2025, driven by new customers and growing international sales[140]. - Revenue increased by $7.8 million, or 15%, to $59.4 million for the nine months ended September 30, 2025, compared to $51.7 million for the same period in 2024, driven by new customers and growing international sales[155]. Net Loss and Financial Position - The net loss decreased by $1.8 million, or 17%, from $10.4 million for the three months ended September 30, 2024, to $8.6 million for the same period in 2025[117]. - The company has an accumulated deficit of $388.5 million as of September 30, 2025, and expects to incur losses for the foreseeable future[119]. - Net loss for the nine months ended September 30, 2025, was $29.8 million, compared to a net loss of $28.6 million for the same period in 2024, reflecting a 4% increase in loss[167]. - As of September 30, 2025, cash and cash equivalents were $29.7 million, down from $52.7 million as of December 31, 2024[168]. - Cash used in operating activities was $23.3 million for the nine months ended September 30, 2025, an improvement from $34.1 million used in the same period in 2024[173]. Market Opportunity - The annual U.S. total addressable market opportunity for OviTex products is estimated to be approximately $1.8 billion[104]. - The annual U.S. current addressable market opportunity for OviTex PRS products is estimated to be approximately $800 million[109]. Product Development and Sales - The OviTex portfolio includes multiple configurations for various surgical procedures, with new product launches in 2023 and 2024 targeting specific hernia repair needs[105]. - Unit sales volume of OviTex increased by 22% to 5,795 units for the three months ended September 30, 2025, compared to 4,767 units in the same period of 2024[140]. - The company is focusing on research and development for new product variations and enhancements to extend the shelf life of existing products[116]. Expenses and Cost Management - Cost of revenue increased by $0.6 million, or 10%, to $6.6 million for the three months ended September 30, 2025, primarily due to higher product purchases[141]. - Gross profit increased by $1.1 million, or 9%, to $14.0 million for the three months ended September 30, 2025, attributed to increased unit sales and new customers[143]. - Sales and marketing expenses decreased by $1.2 million, or 8%, to $15.2 million for the three months ended September 30, 2025, due to lower compensation and benefits[146]. - General and administrative expenses increased by $0.3 million, or 7%, to $3.9 million for the three months ended September 30, 2025, primarily due to higher compensation and professional fees[147]. - Research and development expenses increased by $0.3 million, or 14%, to $2.3 million for the three months ended September 30, 2025, mainly due to higher study and development costs[148]. - Cost of revenue (excluding amortization of intangible assets) rose by $2.4 million, or 15%, to $18.5 million for the nine months ended September 30, 2025, primarily due to increased product purchases to support higher unit sales[156]. - Gross profit increased by $5.3 million, or 15%, to $40.6 million for the nine months ended September 30, 2025, attributed to higher unit sales and new customer additions[158]. - Sales and marketing expenses decreased by $2.0 million, or 4%, to $48.7 million for the nine months ended September 30, 2025, mainly due to lower compensation and benefits[161]. - General and administrative expenses increased by $0.8 million, or 7%, to $11.9 million for the nine months ended September 30, 2025, driven by higher professional fees and compensation[162]. - Research and development expenses rose by $0.3 million, or 5%, to $7.1 million for the nine months ended September 30, 2025, due to increased study costs[163]. Debt and Financing - The MidCap term loan matures on May 1, 2027, with an interest rate of 6.25% plus the greater of one-month Term SOFR or 1.0%[183]. - A debt refinancing transaction secured up to $70.0 million from Perceptive Advisors, with an initial loan of $60.0 million and an additional $10.0 million available upon meeting certain conditions[186]. - The new credit facility bears interest at a rate of 7.85% plus the greater of one-month Term SOFR or 4.25%, maturing on November 14, 2030[186]. - A 1% increase in interest rates would have resulted in a $0.3 million increase in interest expense for the nine months ended September 30, 2025[191]. - The company has made 36 monthly interest payments on the MidCap term loan since June 2022, with an extension of these payments elected in May 2025[183]. - The MidCap term loan has a prepayment fee of 1.0% and an exit fee of 5% at maturity or prepayment[184]. - As of September 30, 2025, there were no significant changes to the company's commitments and future minimum contractual obligations[185]. Risk Factors - The company is currently assessing the impact of the One Big Beautiful, Bill Act ("OBBBA") on its consolidated financial statements[152]. - The company does not currently have any material exposure to foreign currency fluctuations and does not engage in hedging activities[193]. - Inflationary factors may adversely affect operating results, although the company does not believe inflation has had a material impact to date[192]. - The company has established a redundant account at a high-credit-quality financial institution to mitigate liquidity risk following the events related to Silicon Valley Bank in 2023[189].