Zynex(US:ZYXI)2025-11-17 22:21Revenue Performance - Net revenue decreased by $36.6 million or 73% to $13.4 million for the three months ended September 30, 2025, compared to $50.0 million for the same period in 2024[168] - For the nine months ended September 30, 2025, net revenue decreased by $84.2 million or 57% to $62.2 million from $146.4 million in the same period in 2024[168] - Device revenue decreased by $7.8 million or 53% to $7.1 million for the three months ended September 30, 2025, from $14.9 million for the same period in 2024[176] - Device revenue decreased by $14.8 million or 33% to $30.0 million for the nine months ended September 30, 2025, from $44.8 million for the same period in 2024[176] - Supplies revenue decreased by $28.8 million or 82% to $6.3 million for Q3 2025, and by $69.3 million or 68% to $32.2 million for the nine months ended September 30, 2025[178] Operational Challenges - Device orders decreased by 35% and 20% for the three and nine months ended September 30, 2025, respectively, compared to the same periods in 2024[168] - The decrease in supplies revenue was significantly impacted by the Tricare payment suspension, resulting in a $13.3 million decline for Q3 2025[179] - Device revenue declined by approximately $2.0 million (from the same period in 2024) due to a temporary Tricare payment suspension and workforce reductions[177] Financial Position - Cash used in operating activities was $23.0 million during the nine months ended September 30, 2025, compared to cash provided by operating activities of $10.3 million during the same period in 2024[169] - Working capital deficit was $41.8 million as of September 30, 2025, compared to working capital of $58.3 million as of December 31, 2024[169] - As of September 30, 2025, the company had $13.3 million in cash and cash equivalents and $6.7 million in net accounts receivable[192] Expenses and Impairments - The company recognized pre-tax non-cash asset impairment charges of $30.7 million during the quarter ended September 30, 2025, primarily related to goodwill and certain fixed assets associated with Zynex Monitoring Solutions[154] - Cost of revenue for devices and supplies decreased by $4.9 million or 48% to $5.3 million for Q3 2025, but as a percentage of revenue, it increased to 40% from 20%[180] - General and administrative expenses decreased by $3.5 million or 23% to $11.8 million for Q3 2025, with the percentage of revenue increasing to 88% from 31%[186] - The company recorded non-cash impairment charges totaling $30.7 million during Q3 2025 related to its ZMS subsidiary[189] Net Loss and Default Risk - The company has incurred net losses of $73.3 million for the nine months ended September 30, 2025, compared to net income of $3.6 million during the same period in 2024[198] - The company has not made an interest payment of approximately $1.5 million due on November 15, 2025, which could lead to an event of default[201] Workforce and Severance - The company expects to incur aggregate pre-tax cash severance charges of approximately $0.7 million in the fourth quarter of 2025 due to workforce reductions[154] - Tricare historically represented approximately 20-25% of the company's annual revenue, with cash collections from Tricare amounting to $48.8 million and $38.8 million for the years ended December 31, 2024 and 2023, respectively[165]