Apyx Medical Corp (APYX, Financial) released its 8-K filing on November 8, 2024, detailing its financial performance for the third quarter ended September 30, 2024. The company, known for its advanced energy technology in medical devices, reported a total revenue of $11.5 million, falling short of the analyst estimate of $11.6 million. The earnings per share (EPS) was reported at a loss of $0.14, slightly better than the estimated loss of $0.19 per share.
Company Overview
Apyx Medical Corp is a prominent player in the medical device industry, specializing in energy technology. The company develops, manufactures, and markets a range of cosmetic and surgical products, including the Renuvion cosmetic technology and the J-Plasma system. These products are designed to offer precision and control in surgical procedures, primarily operating through its Advanced Energy and Original Equipment Manufacturing (OEM) segments.
Performance and Challenges
In the third quarter of 2024, Apyx Medical Corp reported a 4.1% year-over-year decline in total revenue, primarily driven by a 6% decrease in the Advanced Energy segment. This decline was attributed to lower average selling prices and reduced domestic sales. However, the company saw a 9% growth in single-use handpiece revenue, with a notable 15% increase in the U.S. market. The OEM segment showed resilience with a 3% increase in revenue.
Financial Achievements and Industry Importance
Despite the revenue challenges, Apyx Medical Corp strengthened its balance sheet through a $7.0 million direct stock offering and amended its revenue covenants. These financial maneuvers are crucial for maintaining liquidity and supporting the company's strategic initiatives in the competitive medical devices industry.
Key Financial Metrics
The company's gross profit for the quarter was $7.0 million, down from $8.0 million in the previous year, with a gross profit margin of 60.5%. Operating expenses decreased significantly to $10.6 million, reflecting cost-saving measures, including a 25% reduction in the U.S. workforce. The net loss attributable to stockholders was $4.7 million, or $0.14 per share, compared to a $4.6 million loss in the prior year.
“While our Advanced Energy sales decreased year-over-year, we were pleased with the continued resiliency of our disposable handpiece, which grew 9% overall and 15% in the U.S. Looking ahead, we expect the strength of our disposable handpiece sales to continue,” said Charlie Goodwin, President and Chief Executive Officer.
Financial Tables Summary
| Segment | Q3 2024 Revenue ($M) | Q3 2023 Revenue ($M) | % Change |
|---|---|---|---|
| Advanced Energy | 9.3 | 9.8 | -5.6% |
| OEM | 2.2 | 2.1 | +2.8% |
| Total | 11.5 | 12.0 | -4.1% |
Analysis and Outlook
Apyx Medical Corp's strategic restructuring and focus on high-growth product segments like disposable handpieces are pivotal in navigating the current market challenges. The company's efforts to streamline operations and enhance its product offerings, such as the upcoming Ayon body contouring system, are expected to bolster its competitive position. However, the decline in Advanced Energy revenue and increased interest expenses pose ongoing challenges that the company must address to achieve sustainable growth.
Overall, Apyx Medical Corp's Q3 2024 performance highlights the company's resilience in a challenging market environment, with strategic initiatives aimed at driving future growth and profitability.
Explore the complete 8-K earnings release (here) from Apyx Medical Corp for further details.
