Financial Data and Key Metrics Changes - Revenue for the first quarter of 2025 was $18,500,000, representing a 12% increase year-over-year and a 5% sequential growth from the fourth quarter of 2024 [4] - Gross margin decreased to 67.6% from 68.3% in the prior year, primarily due to excess and obsolete inventory adjustments [13] - Net loss for the first quarter was $11,300,000 compared to $5,700,000 in the prior year, largely affected by the previous year's sale of the Nivas product line [15] Business Line Data and Key Metrics Changes - Revenue from OviTex grew 15% year-over-year, while OviTex PRS revenue grew 2% [12] - OviTex unit sales increased by 29% for the quarter, while PRS unit sales declined slightly by 3% [12] - The company reached over 69,000 OviTex hernia implantations since inception, with OviTex IHR and Liquefix each generating over $1,000,000 in sales since their launch in 2024 [9] Market Data and Key Metrics Changes - The European business saw a 17% growth over the first quarter of 2024, indicating strong international demand [5] - The hernia market is shifting away from plastic mesh towards more natural repair products, which positions the company favorably [8] Company Strategy and Development Direction - The company is focused on expanding its commercial organization, with plans to increase the number of territory managers and account specialists [6] - The introduction of larger sizes of OviTex PRS products aims to simplify complex procedures and improve operational efficiency for surgeons [9] - The company is committed to bringing new and complementary products to market, enhancing its product portfolio [9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to achieve its 2025 revenue guidance of $85,000,000 to $88,000,000, representing growth of 23% to 27% over 2024 [5][16] - The management highlighted the importance of stability and strength in the sales force, emphasizing a long-term growth strategy rather than short-term gains [25][26] Other Important Information - The company is currently facing a 10% tariff on products shipped from New Zealand, which is expected to negatively impact gross margin by 50 to 100 basis points [11] - The company is working to mitigate tariff impacts by adjusting shipping strategies [11] Q&A Session Summary Question: What are the key factors for continuing sequential growth through the end of the year? - Management noted that historical revenue patterns indicate a larger step up from Q1 to Q2, with continued traction from sales representatives driving growth [21][22] Question: Any changes in competitive hiring dynamics? - Management indicated that the hiring environment has stabilized, with a strong sales force and high morale contributing to retention [27][28] Question: Clarification on tariff impact on gross margin? - Management explained that the tariff impact will gradually affect gross margin starting in Q2, with a projected negative effect of 50 to 100 basis points [38][39] Question: How is the bundling situation with GPOs playing out? - Management emphasized the need to increase the number of surgeons using their products in facilities to justify their market position [45][46] Question: Updated expectations on growth rates for PRS and OviTex? - Management expects continued good growth from both products, with PRS anticipated to grow faster due to its higher average selling price [51][54]