Vivos Therapeutics(US:VVOS)2025-05-15 22:02Financial Data and Key Metrics Changes - Total revenue for Q1 2025 was $3 million, down from $3.4 million in Q1 2024, primarily due to lower service revenue from VIP enrollments [20] - Product sales increased by approximately $100,000, while sponsorship, conference, and training revenue rose by $200,000 [20] - Gross profit decreased to $1.5 million in Q1 2025 from $1.9 million in Q1 2024, with gross margin dropping to 50% from 57% [21][22] - Operating loss for Q1 2025 was approximately $3.9 million, slightly higher than the $3.8 million loss in Q1 2024 [24] Business Line Data and Key Metrics Changes - Service revenues declined as the company eliminated its VIP enrollment sales team, while product sales, particularly in pediatric guide appliances, grew significantly, with total arches shipped increasing by 87% [8][20] - The billing intelligence service and myofunctional therapy service revenue remained unchanged at $200,000 for both Q1 2024 and Q1 2025 [20] Market Data and Key Metrics Changes - The company is expecting to close the acquisition of Sleep Center of Nevada (SCN) soon, which sees approximately 3,000 sleep patients monthly, with a significant percentage testing positive for obstructive sleep apnea (OSA) [9][12] - The acquisition is anticipated to be accretive to revenue and gross profit shortly after closing [9] Company Strategy and Development Direction - The company is pivoting to create strategic alliances or acquisitions of sleep medical providers to drive sales of OSA treatment appliances and diversify revenue streams [7][8] - The management believes that the SCN acquisition will be transformational, providing a fast track to increase patient treatment and revenue [10][11] - The company is actively exploring additional acquisition opportunities in the sleep medicine sector, with positive reception from the sleep medicine community [16][17] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the new business model and its potential for growth, emphasizing the importance of the SCN acquisition [7][10] - The management team has learned valuable lessons from previous partnerships, which will inform future negotiations and operational strategies [36] Other Important Information - The company has signed a non-binding term sheet for a $7.5 million senior loan to facilitate the SCN acquisition and working capital [9] - Cash used in operations for Q1 2025 was $3.8 million, an increase from $2.5 million in Q1 2024 [24][25] Q&A Session Summary Question: Can you expand on the experience with the Rebus Alliance? - The partnership has progressed slower than expected due to internal issues at Rebus, but the company has proven its thesis that a significant percentage of patients prefer VIVOS treatments over CPAP [28][30] Question: What can be learned from the Rebus experience for future partnerships? - The management has learned to optimize revenue and services in a medical insurance-oriented environment, which will be applied to future partnerships [36] Question: What is the expected impact of the SCN acquisition on the P&L? - The acquisition is expected to add significant revenue and become accretive by Q3 2025, with immediate revenue generation from diagnostic services [44][49] Question: How was the acquisition price of $9 million determined? - The valuation was based on a quality of earnings report and the potential patient volume from SCN, with a fair price offered to the current owners [53][56]