ANGO Q1 2025: $21M Cash Burn; Cash Flow Break-Even by FY26
- Strong market validation for AlphaVac: Physicians have provided overwhelmingly positive feedback regarding the intuitive design and efficiency of the device, indicating robust clinical adoption and competitive positioning against existing lytic-based therapies.
- Growth through geographic expansion with Auryon: The Q&A highlighted the planned limited European launch following recent CE mark approval, leveraging established global awareness to potentially capture a new and growing market opportunity.
- Improving cost structure and margin potential: The responses confirm that the ongoing manufacturing transfer is on track and expected to eventually reduce overhead costs, which along with an increasing mix of high‐margin Med Tech products, supports future profitability.
- Manufacturing transition uncertainty: Management indicated that the outsourced manufacturing program isn’t showing a smooth improvement in gross margins yet, with ongoing issues like double paying overhead costs during the transition, which could delay margin improvements and profitability.
- International order volatility: Questions raised regarding the choppiness and timing of international distributor orders, particularly impacting NanoKnife sales, suggest that revenue could remain unpredictable and may trend lower if such issues persist.
- Regulatory and reimbursement risks for NanoKnife: Uncertainty around obtaining a favorable CPT code and securing proper reimbursement for NanoKnife creates ambiguity around its future pricing and commercial success, potentially undermining revenue growth.
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Cash Flow
Q: What about Q1 cash burn impact?
A: Management noted a $21M Q1 cash burn due to higher commissions and other expenses, and they expect usage to normalize with cash flow breaking even by FY ’26. -
Manufacturing Savings
Q: Manufacturing savings and gross margin outlook?
A: They’re progressing well with the manufacturing transfer, aiming for $15M savings annually by FY27, with gradual gross margin improvement as overhead costs are reduced. -
International Orders
Q: How do distributor orders affect revenue timing?
A: Management explained that variability in international distributor orders causes some soft revenue in Q1, which should normalize in later quarters. -
NanoKnife CPT
Q: What’s the CPT timeline and pricing plan?
A: They’re awaiting the CPT code decision in October and will maintain current pricing without an immediate premium change. -
Auryon Strategy
Q: How will Auryon perform in Europe?
A: With a recently received CE mark, they are targeting hospital penetration and a staged market entry in Europe, expecting a gradual revenue uptake in a less mature market. -
AlphaVac Launch
Q: How is the AlphaVac launch progressing?
A: Strong field feedback underscores its intuitive design and effective clot removal, with management closely monitoring promising early adoption for PE treatment.
Research analysts covering ANGIODYNAMICS.