Neuronetics (STIM) Q2 Loss Wider Than Expected, Revenues Fall Y/Y

Core Viewpoint - Neuronetics reported weaker-than-expected financial results for Q2 2024, with both revenues and net loss exceeding prior year figures and missing consensus estimates [10] Financial Performance - The net loss for Q2 2024 was $0.33 per share, wider than the loss of $0.17 per share in the same quarter last year and also missing the Zacks Consensus Estimate of a loss of $0.27 per share [1] - Consolidated revenues were $16.5 million, down 6.3% from $17.6 million in Q2 2023, and missed the Zacks Consensus Estimate by 12.2% [2] - Total U.S. revenues were $16.1 million, a decrease of 7% year-over-year, primarily due to a drop in treatment sessions and NeuroStar Advanced Therapy System sales [3] - Revenues from the U.S. NeuroStar Advanced Therapy System totaled $4 million, down 11% from $4.5 million in Q2 2023, while U.S. treatment session revenues were $11.7 million, down 5% from $12.3 million [4] Margins and Expenses - Gross profit for the quarter was $12.2 million, down 4.7% year-over-year, but gross margin expanded by 150 basis points to 74% due to an 11.7% decline in the cost of revenues [5] - Sales and marketing expenses increased by 6.4% to $12.3 million, while general and administrative expenses decreased by 0.8% to $6.1 million, and R&D expenses fell by 5.5% to $2.2 million [5] Adjusted Operating Loss - The adjusted operating loss was $8.5 million in Q2 2024, compared to a loss of $7.3 million in the same period last year [6] Cash Position - At the end of Q2 2024, Neuronetics had cash and cash equivalents of $42.6 million, down from $47.7 million at the end of Q1 2024 [7] Guidance - The company expects total worldwide revenues for the full year 2024 to be in the range of $78-$80 million, with the Zacks Consensus Estimate at $78.9 million [8] - For Q3 2024, total worldwide revenues are expected to be in the range of $18.5-$19.5 million [9] Operational Milestones - Neuronetics achieved a milestone with over 182,000 global patients having undergone 6.6 million treatment sessions in the quarter [11] - The company secured a $50 million Initial Tranche of Debt Facility with Perceptive Advisors, reducing net debt by $10 million [11]