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Apyx Medical(APYX) - 2024 Q4 - Earnings Call Transcript
APYXApyx Medical(APYX)2025-03-13 20:14
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Financial Data and Key Metrics Changes - Total revenue for Q4 2024 was 14.2million,adecreaseof314.2 million, a decrease of 3% compared to 14.7 million in Q4 2023 [7][23] - Gross profit for Q4 2024 increased to 9million,withagrossprofitmarginof63.09 million, with a gross profit margin of 63.0%, up from 60.9% in the prior year [25] - Net loss attributable to stockholders was 4.6 million or 0.12pershareforQ42024,comparedtoanetlossof0.12 per share for Q4 2024, compared to a net loss of 9.6 million or 0.28pershareinQ42023[28]BusinessSegmentDataandKeyMetricsChanges−AdvancedEnergysegmentrevenuewasflatatapproximately0.28 per share in Q4 2023 [28] Business Segment Data and Key Metrics Changes - Advanced Energy segment revenue was flat at approximately 12.1 million, with a 30% increase compared to Q3 2024 [8][24] - OEM segment sales decreased by 16% to approximately 1.6millioninQ42024comparedtoQ42023[24]−Domesticrevenueincreasedby11.6 million in Q4 2024 compared to Q4 2023 [24] - Domestic revenue increased by 1% year-over-year to 10.6 million, while international revenue decreased by 8% to 3.7million[25]MarketDataandKeyMetricsChanges−TheaestheticmarkethasfacedchallengesduetothemacroeconomicenvironmentandtheadoptionofGLP−1drugs,whichhavediverteddiscretionaryspending[9][10]−ThecompanybelievesthatpatientswhohavelostweightduetoGLP−1drugswillseeksurgicalsolutions,positioningtheRenuvionsystemfavorably[11][12]CompanyStrategyandDevelopmentDirection−ThecompanyisfocusingonthelaunchoftheAYONBodyContouringSystem,expectedinthesecondhalfof2025,whichintegratesmultiplesurgicaltechnologies[16][18]−ApyxMedicalaimstocapitalizeonthegrowingdemandforsurgicalaesthetics,particularlyforpatientsexperiencingskinlaxityaftersignificantweightloss[12][60]−ArestructuringprogramwasimplementedtoreduceU.S.workforcebynearly253.7 million [25] Market Data and Key Metrics Changes - The aesthetic market has faced challenges due to the macroeconomic environment and the adoption of GLP-1 drugs, which have diverted discretionary spending [9][10] - The company believes that patients who have lost weight due to GLP-1 drugs will seek surgical solutions, positioning the Renuvion system favorably [11][12] Company Strategy and Development Direction - The company is focusing on the launch of the AYON Body Contouring System, expected in the second half of 2025, which integrates multiple surgical technologies [16][18] - Apyx Medical aims to capitalize on the growing demand for surgical aesthetics, particularly for patients experiencing skin laxity after significant weight loss [12][60] - A restructuring program was implemented to reduce U.S. workforce by nearly 25%, aiming for annualized cost savings of approximately 4.3 million [20][21] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the momentum in the Advanced Energy segment and the potential for growth in 2025 [8][9] - The company anticipates total revenue for 2025 to be in the range of 47.6millionto47.6 million to 49.0 million, reflecting a slight increase from 2024 [30] - Management noted that the aesthetic space is experiencing disruption due to the impact of GLP-1 drugs, which could benefit companies with the right technologies [62] Other Important Information - The company completed a registered direct offering with net proceeds of approximately 6.8milliontostrengthenitsbalancesheet[21]−CashandcashequivalentsasofDecember31,2024,were6.8 million to strengthen its balance sheet [21] - Cash and cash equivalents as of December 31, 2024, were 31.7 million, down from $43.7 million a year earlier [29] Q&A Session Summary Question: Confirmation of gross margin for 2025 - Management confirmed that they expect gross margins to be around 60% for 2025 [34][35] Question: Timing and revenue expectations for AYON - Management indicated that the guidance for AYON has not been updated despite the earlier submission for FDA approval, and revenue expectations remain conservative [40][41] Question: Changes in direct-to-consumer campaign and future outlook - Management highlighted the success of the DTC campaign and the importance of addressing the needs of patients experiencing skin laxity due to weight loss [50][52] Question: Domestic vs. international market performance - Management noted that the U.S. market is performing better due to early adoption of GLP-1 drugs, with expectations for similar trends internationally [56][58] Question: Adoption of GLP-1s and utilization of Renuvion - Management reported growth in handpiece sales in the U.S. and noted that surgical practices are adapting to treat patients with skin laxity effectively [66][70] Question: Upgrades for the Apyx One Console - Management stated that there is still a significant number of customers who need to upgrade to the Apyx One Console before AYON's launch [72][75]