Financial Data and Key Metrics Changes - Net revenue for Q2 2025 was $22.3 million, a significant decline from $49.9 million in Q2 2024, primarily due to TRICARE's temporary payment suspension and reduced order growth [24][11] - Gross profit was $15.2 million, representing 68% of revenue, compared to $39.9 million or 80% of revenue in the same quarter last year [24] - Net loss was $20 million, or $0.66 per share, compared to a net income of $1.2 million in Q2 2024, with a noncash charge of $10.3 million related to deferred tax assets included in the loss [25][11] - Adjusted EBITDA loss for Q2 2025 was $8.9 million, compared to an adjusted EBITDA of $3.5 million in Q2 2024 [26] Business Line Data and Key Metrics Changes - Device revenue was $11 million, while supplies revenue was $11.3 million, indicating a decline in both segments due to the payment suspension and sales force reductions [24] - Sales and marketing expenses decreased by 45% to $12.8 million, primarily due to headcount reductions aimed at improving sales rep productivity [25] - General and administrative expenses were $12.7 million, down from $14.5 million in the previous year [25] Market Data and Key Metrics Changes - The company is actively working to diversify its revenue streams and reduce reliance on TRICARE, which has seen a reduction in patient inflow due to the payment suspension [10][36] - The patient monitoring market is estimated to be approximately $3.5 billion globally, with the company aiming to enter this market with its new Nico pulse oximeter technology [22] Company Strategy and Development Direction - The company is refocusing its pain management business model, restructuring its sales force, and streamlining operations to improve efficiency and reduce costs, targeting an annual savings of up to $40 million [5][13] - The new CEO, Steven Dyson, is expected to lead a review of the company's forecasting procedures and align strategies for growth [6][28] - The company aims to improve patient outcomes by providing non-opioid alternatives for pain management and enhancing the accuracy of patient monitoring through innovative technologies [29] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about returning to positive cash flow by the end of the year, despite current challenges [5][12] - The company is committed to improving its operational sustainability and patient care, while navigating the complexities of the reimbursement landscape [14][29] - Management acknowledged the ongoing challenges with TRICARE but emphasized the importance of continuing to service existing patients [10][50] Other Important Information - The company has submitted its Nico pulse oximeter to the FDA, with expectations for a six-month clearance process following an additional information request [22][33] - The company is actively cooperating with TRICARE and advocating for the resolution of the payment suspension [9][10] Q&A Session Summary Question: Update on Nico submission and expected approval timeline - The company expects to receive additional questions from the FDA in August and anticipates clearance closer to December [32][33] Question: TRICARE payment suspension and patient referrals - The company continues to service existing and new TRICARE patients despite the payment suspension, although patient inflow has decreased due to reduced sales rep headcount [36][50] Question: Sales and marketing expenses outlook for the second half of the year - Continued reductions in sales and marketing expenses are expected, with a projected decrease of 15-20% in Q3 [37][38] Question: Nature of FDA data request and preparation - The FDA is focused on ensuring the new technology performs as well as or better than existing LED technology, and the company is prepared to respond quickly to any inquiries [41][42] Question: Future initiatives under the new CEO - The new CEO is aligned with the company's initiatives to refocus on pain management and improve overall company valuation [43]