Sanuwave Health (NasdaqGM:SNWV) Q4 2025 Earnings call March 27, 2026 08:30 AM ET Company ParticipantsAlbert Hanser - Founder and CEOEthan Starr - Private InvestorIan Cassel - Founder and Chief Investment OfficerMorgan Frank - CEO and Chairman of the BoardPeter Sorensen - CFOConference Call ParticipantsCarl Byrnes - Senior Equity Research AnalystKyle Bowser - Senior Research AnalystOperatorHello and welcome everyone joining today's Sanuwave earnings call. At this time, all participants are in a listen only m ...

Sanuwave Health (NasdaqGM:SNWV) Q4 2025 Earnings call March 27, 2026 08:30 AM ET Company ParticipantsAlbert Hanser - Founder and CEOEthan Starr - Private InvestorIan Cassel - Founder and Chief Investment OfficerMorgan Frank - CEO and Chairman of the BoardPeter Sorensen - CFOConference Call ParticipantsCarl Byrnes - Senior Equity Research AnalystKyle Bauser - Managing Director and Senior Research AnalystOperatorHello and welcome everyone joining today's SANUWAVE Earnings Call. At this time, all participants ...

Sanuwave Health (NasdaqGM:SNWV) Q4 2025 Earnings call March 27, 2026 08:30 AM ET Speaker6Thank you for your continued patience. Your meeting will begin shortly. If you need assistance at any time, please press star zero and a member of our team will be happy to help you. Thank you for your continued patience. Your meeting will begin shortly. If you need assistance at any time, please press star zero and a member of our team will be happy to help you. Thank you for your continued patience. Your meeting will ...

Financial Data and Key Metrics Changes - The company reported record quarterly revenue of $9.4 million for Q3 2024, representing an 89% increase year-over-year and a 31% sequential increase from Q2 2024 [5][11] - Gross margin improved to 75.5%, up from 71.5% in the same period last year, primarily due to a line transfer at a new contract manufacturer and positive pricing impacts [12] - Operating income for Q3 2024 was $2 million, an improvement of $2.5 million compared to the same period last year [12] - The net loss decreased to $20.7 million from $23.7 million year-over-year, attributed to a change in the fair value of derivative liabilities and increased operating income [13] Business Line Data and Key Metrics Changes - Consumables revenue, which constitutes approximately 58% of total revenue, grew 75% year-over-year and 14% sequentially [5] - Ultimate Systems sales saw a significant increase of 144% year-over-year and 74% sequentially, indicating strong demand and successful sales strategies [6] Market Data and Key Metrics Changes - The company is focusing on the U.S. market, where it has seen substantial growth, while international sales remain sluggish, primarily associated with the dermaPACE and profile product line [38] Company Strategy and Development Direction - The company aims to transition from a small to a medium-sized business by engaging with larger, more sophisticated customers, which presents both opportunities and challenges in revenue forecasting [8][10] - There is a focus on maintaining multiple sourcing for manufacturing to avoid single points of failure, with plans to enhance gross margins through new manufacturing processes [21][22] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, highlighting a strong customer pipeline and the potential for continued growth, particularly in the U.S. market [26] - The company is guiding for Q4 revenue between $9.7 million and $10.5 million, which would represent a 40% to 50% growth compared to the same quarter last year [15] Other Important Information - The company has successfully repaid certain debts and regained compliance with loan covenants, simplifying its capital structure [7] - A full-time employee has been hired to address material weaknesses in internal controls over reporting, indicating a commitment to improving operational integrity [40] Q&A Session Summary Question: Can you discuss the transition to new manufacturers? - The company has successfully transitioned to two new contract manufacturers for systems, achieving a production rate of 25 to 30 systems per week [20] Question: How many systems sold this quarter were from the new manufacturing? - Only a few systems were produced by the new manufacturers by the end of Q3, with a more significant impact expected in Q4 [22] Question: Can you provide details on the customer pipeline? - The current customer pipeline is the best seen, with larger and more sophisticated customers showing interest, although the sales process is more complex [26] Question: What is the outlook for operating expenses? - Operating expenses are expected to remain flat in Q4 compared to Q3, with modest growth anticipated in 2025 [33] Question: What is the status of the company's debt obligations? - The company has repaid a $1.3 million note and is no longer in default on its debt obligations [37] Question: What is the company's focus on international sales? - The company is primarily focused on the U.S. market due to its size and potential, with limited focus on international sales for the time being [38]

Financial Data and Key Metrics Changes - Revenue for Q3 2023 totaled $5 million, an increase of 19% compared to $4.2 million for the same period in 2022, falling within the guidance range of 15% to 25% [11] - Gross margin for Q3 2023 was 71%, slightly down from 72% in the same period last year [11][12] - Operating loss for Q3 2023 was $500,000, an improvement of $2 million compared to the same period last year [12] - Net loss for Q3 2023 was $23.7 million, compared to a net loss of $1.1 million for the same period in 2022, primarily due to noncash losses on derivative liabilities [13] Business Line Data and Key Metrics Changes - 55 UltraMist units were sold in Q3 2023, with over 40% of those sales to new customers [17] - Ultramist revenues grew over 25% year-on-year in Q3 2023, with consumables revenue growing 11% from Q2 and 24% compared to Q3 2022 [22] - Consumables for Ultramist constituted 62% of overall revenues in the quarter [22] Market Data and Key Metrics Changes - The company ended Q3 2023 with 581 active systems in the field, up from 526 at the end of Q2 [22] - The company is focusing on engaging new customers, particularly in busy practices with high utilization rates [21] Company Strategy and Development Direction - The company is developing a new business model allowing customers to bundle payments for UltraMist into a monthly operating cost, which is expected to generate predictable recurring revenue [7][9] - The company aims to increase production capacity for systems to two to three times the 2023 levels in 2024 [39] - The merger with Sweat Equity Partners is anticipated to enhance capital and capabilities, with plans to move to NASDAQ [24] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about eliminating production constraints and achieving a stable manufacturing cadence of double-digit rates per week [5] - The company anticipates revenue growth in the range of 15% to 25% for Q4 2023, with no significant production capacity constraints expected [25] Other Important Information - The company closed an additional financing round in July 2023, raising approximately $3 million to support operations [13] - Management emphasized the importance of pricing discipline and the positive market response to it [18] Q&A Session Summary Question: What is the state of dermaPACE and its future? - Management indicated that dermaPACE was slow in Q3 and is currently assessing its direction, focusing on international channels and potential long-term studies for reimbursement [28][30] Question: Update on merger approval and potential hurdles? - Management stated that they filed an amended S-4 and are awaiting SEC comments, with a good chance of closing the deal this year [32][34] Question: Capacity for devices and applicators going forward? - Management confirmed that production capacity has reached a double-digit cadence weekly and plans to significantly increase capacity in 2024, including redesigning applicators for better manufacturability [39][40]

Financial Data and Key Metrics Changes - Revenue for Q2 2023 totaled $4.7 million, a 20% increase compared to $3.9 million in Q2 2022, falling within the guidance range of 15% to 25% [8] - Gross margins increased to 74% in Q2 2023 from 72% in the same period last year, primarily due to stronger pricing initiatives [9] - Operating income improved to $1 million in Q2 2023, aligning with the initiative to drive profitable growth [10] - Net loss for Q2 2023 was $7.3 million, compared to a net income of $1.6 million in Q2 2022, primarily due to noncash losses on derivative liabilities [10] - Adjusted EBITDA for Q2 2023 was $171,000, compared to negative $1.9 million in the prior year period [11] Business Line Data and Key Metrics Changes - The company is focusing on consumables, with Ultramist consumables accounting for 59% of overall revenues in Q2 [17] - The attach rate, which measures the number of active systems in the field and their consumable usage, is expected to rise significantly in future years [20] Market Data and Key Metrics Changes - Fastest growing sales channels are private offices, nursing homes, and mobile wound care groups, indicating a shift towards treating patients outside of hospitals [13] - Proposed changes by Medicare contractors could significantly impact the marketplace for advanced skin substitutes, potentially benefiting Ultramist as a viable treatment option [14] Company Strategy and Development Direction - The company aims for rapid profitable growth and to create a self-sustaining business model, reducing reliance on capital markets [7] - Key hires and partnerships, such as with Pacific Medical, are intended to expand market reach and professionalize operations [6][15] Management's Comments on Operating Environment and Future Outlook - Management anticipates revenue growth of 15% to 25% year-over-year for Q3 2023, despite production capacity constraints [22] - The company is optimistic about the future of the wound care market and is focused on increasing the number of active systems and consumables revenue [23] Other Important Information - Total current assets as of June 30, 2023, were $6.1 million, down from $6.6 million at the end of 2022 [11] - The company closed an additional financing round in July 2023, raising approximately $3 million to support operations [11] Q&A Session Summary Question: Comments on the dermaPACE product - Management stated that dermaPACE units are still being sold actively, but it represents a small portion of revenue, with a renewed focus expected in coming quarters [26][27]

Financial Data and Key Metrics Changes - In Q1 2023, revenue amounted to $3.8 million, representing an 18% increase compared to the same period last year, aligning with the guidance of 14% to 20% growth [9][10] - Gross margin decreased to 67% in Q1 2023 from 72% in Q1 2022 due to cost increases associated with servicing refurbished equipment [7][10] - Operating expenses increased by 4.7% year over year, totaling $4.5 million, primarily due to higher general and administrative expenses [9][10] Business Line Data and Key Metrics Changes - The number of treatments reached a record 43,000 in Q1 2023, indicating continued adoption of Ultramist [7] - Units shipped achieved the highest level for the first quarter in company history, reflecting robust demand despite supply chain challenges [7] Market Data and Key Metrics Changes - Demand for products remains strong, with over 20 new accounts added to the pipeline following recent conferences [6] - The company is on track to receive over 400 devices in 2023, compared to 217 sold last year, although it is uncertain if all will be sold [5] Company Strategy and Development Direction - The company is focused on addressing supply chain issues to balance supply and demand, with initiatives aimed at improving automation and reducing costs [8][16] - Management plans to leverage existing infrastructure for profitable growth and aims to achieve record revenue growth and profitability in 2023 [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in overcoming supply constraints, indicating that the issues are primarily related to Ultramist production [23] - The company anticipates revenue growth of 15% to 25% in Q2 2023, contingent on supply chain improvements [15] Other Important Information - The company closed an additional private placement in May 2023, raising $1.2 million to support operations [10] - Management emphasized the importance of strong reimbursement channels for Ultramist across various service settings, enhancing market opportunities [20] Q&A Session Summary Question: Can you expand on the reimbursement situation for Ultramist? - Ultramist has strong reimbursement in multiple settings, including hospitals, private offices, home health, assisted living facilities, and nursing homes, providing diverse channels for growth [20] Question: Are the supply constraints expected to be prolonged? - Supply constraints are primarily around Ultrimist, but management is confident that these issues will not last a year and are working to ensure a consistent supply [23] Question: Will operating cost increases be a recurring issue? - The increase in operating costs is largely due to one-time professional service fees related to SEC initiatives, and overall operating expenses are increasing at a slower rate compared to revenue [29]