ProSomnus(US:OSA)2023-08-08 16:00Financial Performance - Revenue for Q2 2023 was $6.9 million, a 43% increase from $4.9 million in Q2 2022, driven by increased unit volume and sales and marketing investments [124]. - Net income for Q2 2023 was $0.9 million, compared to a net loss of $2.8 million in Q2 2022 [112]. - Revenue for the three months ended June 30, 2023, was $6,933,910, representing a 42.7% increase from $4,859,909 in the same period of 2022 [126]. - For the six months ended June 30, 2023, revenues increased by $4,139,238, or 48.1%, to $12,742,290, driven by increased unit volume and sales and marketing investments [129]. - The company reported a net loss of $5,987,241 for the six months ended June 30, 2023, compared to a loss of $5,804,378 in the same period of 2022 [131]. Gross Margin and Profitability - Gross margin for Q2 2023 was 54%, up from 52% in the same period last year [125]. - Gross profit for the three months ended June 30, 2023, was $3,763,116, with a gross margin of 54%, compared to a gross profit of $2,538,217 and a margin of 52% in the prior year [126]. - The gross margin for the six months ended June 30, 2023, was 53%, down from 55% in the same period of 2022, attributed to increased overhead costs from a new manufacturing facility [130]. Operating Expenses - Sales and marketing expenses increased by $1.6 million, or 80.9%, in Q2 2023 compared to Q2 2022, primarily due to personnel expenses and travel [125]. - Operating expenses increased significantly, with sales and marketing expenses rising by 80.9% to $3,642,718 and general and administrative expenses increasing by 247.5% to $4,480,124 [126]. - Total operating expenses for the six months ended June 30, 2023, were $16,694,902, an increase of 108.7% from $8,000,680 in the prior year [131]. Cash and Financing - Cash and cash equivalents were $6.2 million as of June 30, 2023, which the company believes is insufficient to continue operations for at least one year [135]. - The company expects to finance future cash needs through private or public equity offerings or debt financings, with no assurance of obtaining adequate funds [137]. - The company anticipates continued reliance on external financing, likely through preferred equity securities, common stock offerings, or incurring debt [145]. - As of June 30, 2023, total recorded contractual obligations amounted to $43,997,827, including $16,959,807 in senior convertible notes and $17,453,141 in subordinated convertible notes [147]. - As of August 1, 2023, the company maintained a minimum cash balance of $4.5 million, in compliance with its financial covenants [144]. Business Operations and Market Position - Over 200,000 ProSomnus precision devices have been prescribed to patients since market introduction [107]. - The company plans to expand its direct sales organization in North America and initiate marketing in several European countries [115]. - FDA clearance was received for an intraoral device enabling remote patient monitoring services, expected to create a recurring revenue stream [118]. - ProSomnus therapy is covered by approximately 70% private insurance, 25% Medicare, and 5% out-of-pocket payments [111]. - The company moved to a new manufacturing facility in 2023, quadrupling its previous capacity [125]. Other Financial Information - Total other income for the three months ended June 30, 2023, was $6,640,692, a change of $8,030,660 from an expense of $1,389,968 in the prior year [128]. - Cash and cash equivalents as of June 30, 2023, totaled $6.2 million, with no material exposure to interest rate changes [155]. - Inflation has not had a material effect on the company's results of operations for the periods presented [156]. - The accumulated deficit as of June 30, 2023, was $216.8 million [112].