Financial Data and Key Metrics Changes - In Q3 2025, the company achieved net revenue of $26.3 million, representing a 22% year-over-year growth, primarily driven by sales of soft tissue repair products [11][12] - Gross profit increased by $4.8 million, or 24%, to $24.5 million, with gross margin rising approximately 200 basis points to 93% of net revenue [21][22] - Net income from continuing operations was $800,000, or $0.09 per diluted share, compared to a net loss of $200,000, or $0.02 per diluted share in the previous year [23] Business Line Data and Key Metrics Changes - Sales of soft tissue repair products increased by 24% year-over-year to $23.4 million, significantly contributing to overall revenue growth [11][12] - The company expanded its network of independent distributors from over 300 to more than 400 in the last 12 months, enhancing its market reach [13][14] Market Data and Key Metrics Changes - The company sold products into more than 1,400 healthcare facilities over the last 12 months, up from over 1,200 in the prior year, indicating a significant expansion in customer base [14] - The products are approved or contracted for sale in over 4,000 facilities, suggesting substantial future growth potential [15] Company Strategy and Development Direction - The company announced the discontinuation of the Tissue Health Plus (THP) segment to focus resources on its core surgical business, aiming to enhance operational efficiency and long-term growth [9][10][11] - The strategic realignment is intended to capitalize on strengths in the surgical market and improve clinical outcomes while reducing healthcare expenditures [11][27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to achieve strong revenue growth and profitability, emphasizing the effectiveness of their commercial strategy and the potential for further market penetration [26][27] - The company anticipates total cash investment related to THP will range from $5.5 million to $6.5 million in the second half of 2025, with no material cash spend expected after 2025 [10][25] Other Important Information - The company has made progress in expanding its portfolio of clinical evidence, with two studies published in peer-reviewed journals highlighting the efficacy of CellerateRX Surgical in complex surgical procedures [16][17] - The partnership with Biomimetic Innovations Limited for the OSTIC product is progressing well, with expectations for a U.S. commercial launch in Q1 2027 [18][19] Q&A Session Summary Question: Can you elaborate on initiatives to drive further penetration within existing facilities? - Management highlighted efforts to expand into new specialties and the importance of scientific and clinical evidence in supporting product value [28][29] Question: Should we expect cash savings outside of THP and leverage on sales and marketing? - Management indicated that the current model is working well, with flat headcount and evidence of operating leverage on the EBITDA line [30][31] Question: What are the expectations for growth and margins going forward? - Management expressed confidence in strong performance for the upcoming quarter, despite a significant growth quarter in the previous year [32][33] Question: Why was a strategic partner not considered earlier for THP? - Management explained that the pursuit of a strategic partner began in early 2024, but ultimately did not yield results, leading to the decision to discontinue THP [34][35] Question: What is the trend of total operating expenses following the discontinuation of THP? - Management refrained from providing forward-looking guidance but suggested that historical data could help model future trends [36]

Core Insights - Sanara MedTech Inc. reported a strong financial performance for Q3 2025, with net revenue growth of 22% year-over-year, driven primarily by a 24% increase in sales of surgical soft tissue products [3][6][10]. Financial Summary - Q3 2025 net revenue was $26.3 million, compared to $21.7 million in Q3 2024, marking an increase of $4.7 million [6][10]. - For the first nine months of 2025, net revenue reached $75.6 million, up 25% from $60.4 million in the same period of 2024 [10][16]. - Gross profit for Q3 2025 was $24.5 million, a 24% increase from $19.7 million in Q3 2024, with a gross margin of 93% [7][10]. - Operating income for Q3 2025 was $2.9 million, compared to $0.8 million in Q3 2024, reflecting a 278% increase [9][10]. Operational Developments - The company has ceased operations of its THP segment as part of a strategic realignment to enhance operational efficiency and focus on its core surgical business [3][5][10]. - The strategic realignment is expected to support sustained long-term growth and value creation [3][10]. Profitability Metrics - Net income from continuing operations for Q3 2025 was $0.8 million, compared to a net loss of $0.2 million in Q3 2024 [10][12]. - Adjusted EBITDA for Q3 2025 was $4.9 million, up from $2.6 million in Q3 2024, indicating improved profitability [10][13]. Cash Flow and Debt - As of September 30, 2025, the company had $14.9 million in cash and $45.1 million in long-term debt, compared to $15.9 million and $30.7 million, respectively, at the end of 2024 [14][10]. - Net cash provided by operating activities in Q3 2025 was $2.2 million, slightly up from $2.1 million in Q3 2024 [13][10].

Core Insights - Sanara MedTech Inc. reported a 28% year-over-year increase in net revenue for Q2 2025, reaching $25.8 million, driven by strong sales in its Sanara Surgical segment [5][8] - The company is evaluating strategic alternatives for its subsidiary, Tissue Health Plus, LLC, to maximize shareholder value while continuing to invest in its technology platform [4][12] Financial Performance - Q2 2025 net revenue increased to $25.8 million from $20.2 million in Q2 2024, a growth of $5.7 million or 28% [5][8] - For the first six months of 2025, net revenue rose 27% year-over-year to $49.3 million, compared to $38.7 million in the same period of 2024 [15] - The company reported a net loss of $2.0 million in Q2 2025, an improvement from a net loss of $3.5 million in Q2 2024 [12][16] - Adjusted EBITDA for Q2 2025 was $2.7 million, compared to $0.6 million in Q2 2024 [13] Segment Performance - The Sanara Surgical segment achieved a net income of $0.5 million in Q2 2025, a significant improvement from a net loss of $2.2 million in Q2 2024 [12] - The Tissue Health Plus segment reported a net loss of $2.5 million in Q2 2025, compared to a net loss of $1.3 million in Q2 2024 [12] - For the first six months of 2025, the Sanara Surgical segment generated Segment Adjusted EBITDA of $7.4 million, up from $2.5 million in the same period of 2024 [17] Revenue Breakdown - Sales of soft tissue repair products contributed $22.7 million in Q2 2025, up from $17.6 million in Q2 2024, marking a 28% increase [7][8] - Bone fusion products sales increased to $3.1 million in Q2 2025, a 25% rise from $2.5 million in Q2 2024 [7][8] Operating Expenses - Operating expenses for Q2 2025 were $23.9 million, an increase of 14% from $21.0 million in Q2 2024, primarily due to higher selling, general, and administrative expenses [10] - The gross profit for Q2 2025 was $23.9 million, reflecting a gross margin of 93%, up from 90% in Q2 2024 [9] Cash Flow and Debt - Cash flow from operating activities in Q2 2025 was $2.7 million, compared to cash used in operating activities of $1.4 million in Q2 2024 [14] - As of June 30, 2025, the company had $17.0 million in cash and $44.2 million in long-term debt, compared to $15.9 million and $30.7 million, respectively, at the end of 2024 [14]