Zynex(ZYXI) - 2025 Q3 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Net revenue for Q3 2025 was $13.4 million, a significant decline from $50 million in Q3 2024, primarily due to TRICARE payment suspension and a $2.8 million reduction in revenue related to payments received during the suspension period [11][12] - Gross profit in Q3 2025 was $8.1 million, or 60% of revenue, compared to $39.8 million, or 80% of revenue, in Q3 2024 [12] - Net loss for Q3 2025 was $42.9 million, or $1.42 per share, compared to net income of $2.4 million in Q3 2024 [14] - Adjusted EBITDA loss for Q3 2025 was $12.3 million, compared to adjusted EBITDA of positive $5.1 million in Q3 2024 [14] - Cash and cash equivalents as of September 30, 2025, were $13.3 million, with a negative cash flow of $6.3 million for the quarter [7][14] Business Line Data and Key Metrics Changes - Device revenue for Q3 2025 was $7.1 million, while supplies revenue was $6.3 million, contributing to the overall decline in net revenue [11] - Workforce reductions in Q1 and Q2 2025 negatively impacted device orders and new patient onboarding, contributing to the revenue decline [12] Market Data and Key Metrics Changes - Changes to certain payers' claim submission and review practices have resulted in denials and payment delays, negatively impacting revenue [11] Company Strategy and Development Direction - The company is focused on a three-part strategy: addressing government agency concerns, managing near-term debt obligations, and improving revenue and cash flow performance [5][6][9] - A new resupply order fulfillment policy was implemented to enhance patient engagement and compliance [6][7] - The company is actively seeking to raise new capital to fund operations and address the maturity of $60 million in convertible senior notes due in May 2026 [6][8][15] Management's Comments on Operating Environment and Future Outlook - Management acknowledges ongoing challenges but expresses optimism about progress in implementing the turnaround strategy [10] - The company is engaging with government agencies in a collaborative manner to ensure compliance and integrity moving forward [6] Other Important Information - A non-cash asset impairment charge of $30.7 million was recorded in Q3 2025, primarily related to goodwill and certain fixed assets [14] - The company has entered a 30-day grace period regarding a $1.5 million interest payment due on convertible notes [15] Q&A Session Summary - No specific questions or answers were documented in the provided content, indicating that the call concluded without a Q&A segment [17]