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Jun 30
Myomo Q2 2025 Earnings Report
Myomo reported second quarter 2025 financial and operating results.
Key Takeaways
Myomo reported second quarter 2025 revenues of $9.7 million, up 28% year-over-year, exceeding expectations. However, operating metrics like lead quality and pipeline conversion were not as strong as anticipated, leading to a decrease in backlog units and an increase in cost per direct billing pipeline add. The company is implementing strategic changes, including shifting advertising focus and leveraging its clinical team, to improve lead quality and pipeline conversion.
Revenue for Q2 2025 was $9.7 million, a 28% increase compared to Q2 2024, exceeding expectations.
Gross margin for Q2 2025 was 62.7%, a decrease of 810 basis points from 70.8% in Q2 2024, primarily due to higher material and overhead spending.
Operating expenses increased by 65% to $10.6 million, driven by higher payroll, R&D, and advertising costs, with advertising costs up 162%.
The company added 816 new candidates to the patient pipeline, a 49% increase, but backlog units decreased by 18% to 230 units due to slower authorizations and orders.
Myomo
Myomo
Myomo Revenue by Segment
Revenue by Segment
Medicare Part B Revenue
CapyFin.com Forward Guidance
Myomo updated its 2025 revenue guidance to a range of $40 million to $42 million, down from the previous guidance of $50 million to $53 million. Revenue for the third quarter of 2025 is expected to be in the range of $9.5 million to $10.0 million.
Positive Outlook
- The company is taking decisive action to improve lead quality and pipeline conversion.
- Shifting advertising focus from digital to television is expected to generate higher quality leads with stronger patient engagement.
- Leveraging the clinical team to engage with therapists and physicians nationwide will expand understanding of MyoPro benefits and secure additional patient referrals.
- The company expects to reduce cash expenditures by at least $2 million over the next 12 months through workforce reduction and elimination of certain outside services spending.
- The payment hold by one of the DME MACs has been removed, and aged receivables were paid at the beginning of August.
Challenges Ahead
- The updated 2025 revenue guidance of $40 million to $42 million is lower than the previous guidance of $50 million to $53 million.
- Several forward-looking operating metrics were not as strong as anticipated due to factors affecting lead quality and pipeline conversion.
- Lower conversion rates to both pipeline adds and authorizations and orders are impacting performance.
- The quality of leads generated after applying changes to digital advertising in response to an algorithm change was not as anticipated.
- A cycle time effect related to pipeline adds means a significant amount of 2025 advertising spending will generate pipeline adds in 2026 and beyond.