SANUWAVE Health Inc(SNWV) - 2025 Q1 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Q1 2025 revenue totaled $9,300,000, representing a 61% increase compared to $5,800,000 in Q1 2024, exceeding previous guidance of 45% to 55% growth [13][16] - Gross margin increased to 79% in Q1 2025 from 72.6% in Q1 2024, attributed to reduced production costs and strategic pricing [14] - Operating income improved to $1,000,000, up $2,000,000 year-over-year, while net loss increased to $5,700,000 from $4,500,000 in the same period last year [15][16] - Adjusted EBITDA was positive at $2,300,000, an improvement of $2,400,000 year-over-year [15] Business Line Data and Key Metrics Changes - Sales of applicators reached $5,800,000 in Q1 2025, up from $4,100,000 in Q1 2024, constituting 62% of total revenues [7][8] - The company placed 98 new Ultomis systems in Q1 2025, a 128% increase from 43 systems in Q1 2024 [6] Market Data and Key Metrics Changes - The company ended Q1 2025 with 1,145 systems in the field, with 429 placed in the trailing twelve months [6] - The company is focusing on engaging larger customers and expanding into mobile and home healthcare markets, indicating a strategy to increase market penetration [42] Company Strategy and Development Direction - The company aims to build on its strong Q1 performance and is guiding for Q2 revenues of $10,000,000 to $10,700,000, reflecting 40% to 50% year-over-year growth [17] - The strategy includes engaging with larger customers and enhancing the sales team with experienced executives to improve market penetration [41][42] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in supply chains and manufacturing capabilities, stating no anticipated material cost or margin issues due to current economic conditions [11] - The company is exploring refinancing opportunities to improve debt conditions, indicating a proactive approach to financial management [32] Other Important Information - The company incurred a $295,000 listing fee for its NASDAQ uplift, impacting operating profit and EBITDA figures [12] - Inventory levels are described as comfortable, allowing for rapid production ramp-up if needed [10] Q&A Session Summary Question: Can you quantify system placements from smaller and larger customers? - The company noted the complexity in categorizing customers, indicating 58 new customers in Q1, with growth potential varying significantly [21][24] Question: What is the typical time to sale from initiation to purchase order? - The time frame varies widely, from a couple of days for smaller orders to several months for larger customers [25][26] Question: Can you address the debt landscape? - The company is actively exploring refinancing opportunities to improve interest rates, acknowledging that current debt is not favorable [29][32] Question: What is the success rate within the total addressable market? - The company lacks specific visibility into treatment types due to HIPAA regulations but is aware of general trends through provider feedback [34][35] Question: Any updates on patent assertion suits? - The company is engaged with an outside assertion firm and is optimistic about progress, though specifics are limited due to the nature of the agreements [36][37] Question: Insights into the evolving sales strategy? - The company continues to pursue its existing sales strategy while focusing on larger customers and enhancing the sales team with experienced professionals [40][41]