Sensus Healthcare(SRTS) - 2025 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Revenues for Q4 2025 were $4.9 million, a significant decrease from $31 million in Q4 2024, primarily due to lower unit sales [13] - Gross profit for Q4 2025 was $1.9 million, or 38.8% of revenues, down from $7.1 million, or 54.2% in Q4 2024, driven by lower sales and higher servicing costs [14] - For the full year 2025, revenues were $27.5 million, compared to $41.8 million in 2024, reflecting a decrease in unit sales [15] - The net loss for 2025 was $7.7 million, or a loss of $0.47 per share, compared to a net income of $6.6 million, or $0.41 per diluted share in 2024 [18] Business Line Data and Key Metrics Changes - The company shipped 14 units in Q4 2025, with 8 in the U.S. and 6 internationally, but did not include sales to its largest customer [24] - The Fair Deal Agreement program saw substantial year-over-year utilization increases, with treatments up more than eightfold and the number of patients treated increasing by over 250% in 2025 [7] Market Data and Key Metrics Changes - International sales were strong in Q4 2025, with shipments to China and a growing demand in Asia, particularly in Taiwan and South Korea [8][28] - The company expects international markets to remain a significant part of its growth strategy, with Brazil and the Middle East also showing potential [29] Company Strategy and Development Direction - The introduction of new CPT codes for SRT and IG-SRT technologies is expected to enhance physician reimbursement and support broader adoption of non-invasive treatments [4] - The company aims to achieve full-year profitability in 2026, supported by a diversified customer base and expanding international opportunities [9] - A disciplined approach to scaling the sales organization is being implemented, with plans to hire additional sales representatives to enhance market education and lead conversions [11] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about entering 2026 with improved clarity and control over the business, emphasizing the positive impact of new reimbursement codes [20] - The company is focused on converting interest into system placements as the year progresses, with expectations for Q1 revenues to exceed Q4 levels [19] Other Important Information - The company ended 2025 with $22.1 million in cash and cash equivalents, with no outstanding debt, indicating a strong balance sheet [18] - Research and development expenses for 2025 increased to $7.8 million, reflecting higher costs related to billing and reimbursement efforts [17] Q&A Session Summary Question: Does the revenue growth guidance for Q1 assume no contribution from the largest customer? - Management confirmed that projections for 2026 exclude expectations from the largest customer, and any contribution from them would be considered upside [24] Question: What is the status of the TDI program and expected FDA approval? - Management indicated ongoing efforts with the FDA but could not provide a timeline for approval [26] Question: What is the demand outlook internationally for 2026? - Management highlighted strong demand in China and growth in Taiwan, with expectations for expansion in South Korea, Japan, and potential entry into Brazil and the Middle East [28][29] Question: How has the reaction to reimbursement affected system mix and financing options? - Management noted a shift towards outright purchases and leasing options due to guaranteed reimbursements, with a stronger focus on SRT products [38][40] Question: What is the outlook for service revenue? - Service revenue remains consistent at about 10% of total revenue, with no expected changes [48]