Financial Data and Key Metrics Changes - Total revenue for Q2 2025 was $35.4 million, representing an 18% increase compared to $29.9 million in Q2 2024 [13] - Gross margin improved to 68.6% from 62.1% year-over-year, driven by a favorable sales mix and improved production efficiency [14] - Net income for Q2 2025 was $3.5 million, compared to a net loss of $3.9 million in Q2 2024 [16] - Adjusted EBITDA for Q2 2025 was $6.9 million, a significant improvement from an adjusted EBITDA loss of $0.6 million in the same period last year [17] Business Line Data and Key Metrics Changes - Biologics revenue grew over 20% year-over-year, contributing significantly to overall revenue growth [7] - Hardware product family experienced a 20% decline, amounting to a $2.7 million decrease compared to the previous year [13] Market Data and Key Metrics Changes - Licensing revenue for Q2 2025 included nearly $5 million from agreements related to Q codes and the SIMPLIMAX dual layer amniotic membrane [7] - The company anticipates an additional $5 million in licensing revenue for the remainder of 2025 [22] Company Strategy and Development Direction - The company plans to use proceeds from the sale of non-core assets to reduce long-term debt and enhance cash liquidity [5][6] - Focus will shift towards driving growth in the biologics platform, with an emphasis on organic revenue growth and profitability [10] - The company raised its full-year 2025 revenue guidance to a range of $131 million to $135 million, reflecting an expected growth of approximately 11% to 15% over 2024 [11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving self-sustainability and profitability through new product launches and cost-cutting initiatives [10] - The anticipated sale of non-core assets is expected to have a neutral to slightly positive effect on margins and bottom-line metrics [12] Other Important Information - The company has $7 million in cash and cash equivalents, with $27 million in net accounts receivable and $40.1 million in inventory as of June 30, 2025 [17][18] - The anticipated sale of certain assets is expected to close during 2025, with an annual revenue run rate of approximately $23.5 million from the sold businesses [12] Q&A Session Summary Question: Can you clarify the nature of licensing revenue? - Management confirmed that licensing revenue is straightforward and based on sales volume from partners [20] Question: What is the outlook for licensing revenue for the remainder of the year? - Management expects at least another strong quarter but is less confident about Q4 performance [21] Question: What portion of year-over-year growth is driven by new products? - Management indicated that new product introductions, particularly OsteoFactor Pro and Trivium, are expected to contribute positively to growth in the second half of the year [24][26] Question: How should gross margins be viewed for the remainder of the year? - Management anticipates a decline in gross margins by about four to five points due to the effects of royalty revenue and hardware growth decline [30] Question: How will the sale of non-core assets affect the hardware business? - Management believes that divesting non-core assets will allow for greater focus on the domestic hardware business, which is expected to improve performance [32]