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MDxHealth SA(MDXH) - 2025 Q1 - Earnings Call Transcript
MDxHealth SAMDxHealth SA(US:MDXH)2025-05-14 21:32

Financial Data and Key Metrics Changes - The company reported Q1 revenue growth of 22%, reaching $24.3 million compared to $19.8 million in Q1 2024, marking the sixteenth consecutive quarter of 20% or greater revenue growth [5][14][15] - Gross profit increased by 29% to $15.5 million, with gross margins rising to 63.8% from 60.8% in Q1 2024 [15][16] - The operating loss decreased by 31% to $4.6 million, while the net loss increased by 8% to $9.2 million, primarily due to non-cash fair value adjustments [16][16] Business Line Data and Key Metrics Changes - Tissue-based test volume grew by 41%, with approximately 12,600 tests conducted in Q1, representing a 41% increase year-over-year [6][10] - Liquid-based tests saw nearly 12,000 tests, an increase of 9% compared to the prior year [6] Market Data and Key Metrics Changes - The tissue-based segment accounted for 85% of Q1 revenue, driven by the growing diagnostic value of the Confirm test among urology customers [7][10] - The market opportunity for the Confirm test is estimated at $500 million, with a rising prostate cancer rate of 5% to 10% annually [10][80] Company Strategy and Development Direction - The company aims for 20% or greater revenue growth in 2025 and beyond, with a focus on operational discipline and commercial execution [5][13] - The strategy includes leveraging existing sales channels without expanding the sales organization, which has allowed for sustained revenue growth [19][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving positive adjusted EBITDA in Q2 2025, supported by flat operating expenses and continued revenue growth [16][67] - The company is focused on maintaining its leadership position in the high-growth urology diagnostics market, emphasizing the importance of its sales team and operational excellence [20][20] Other Important Information - Cash and cash equivalents as of March 31, 2025, were $65.7 million, with a pro forma cash balance of $37.7 million after an earnout payment [16] - The company has not seen a material impact from recent tariff developments on its financial operations [16] Q&A Session Summary Question: What factors are driving the growth in pathology adoption? - Management noted that the understanding of biopsy limitations has improved, leading to greater acceptance of the Confirm test among pathologists [24][26] Question: What are customers saying about the reasons for market share gains? - Customers appreciate the consultative approach of the sales team and the unique value proposition of the Confirm and GPS tests [28][30] Question: How did weather impact Q1 performance? - Management indicated that weather did not materially affect Q1 performance and expects continued execution in Q2 [36] Question: Can you comment on the growth of the GPS and Confirm tests? - Management reported balanced growth between GPS and Confirm, with both tests seeing increased adoption among urology customers [38][39] Question: What is the company's approach to M&A? - The company is open to growth opportunities but remains disciplined in its approach, focusing on derisking potential acquisitions [44][75] Question: How is the company performing in large urology practices? - Management indicated broad penetration within large urology practices, emphasizing the importance of service levels and differentiation [90][92]