APYX Q1 2025: Console Upgrade Demand Climbs, 20 AYON Ambassadors
- Strong AYON pipeline: Apyx has solidified a list of 20 AYON ambassadors ready to deploy once FDA clearance is received, indicating robust readiness to capture market share in aesthetic surgery.
- Upgraded Apyx One Console demand: There is increased demand for upgrades to the Apyx One Console ahead of the AYON launch, suggesting growing traction among customers and a strong future sales pipeline.
- Resilient manufacturing strategy: With flexible supply chain management from manufacturing facilities in both the U.S. and Sofia, Bulgaria, the company is well positioned to mitigate potential tariff impacts, supporting margin stability.
- Delayed AYON launch risk: Executives declined to comment on the detailed pipeline for AYON, noting they are still waiting for FDA clearance. This uncertainty and potential delay could postpone revenue growth from the new system.
- Tariff and supply chain uncertainty: Although current gross margins remain targeted at around 60%, the reliance on a global parts supply—with manufacturing in both the United States and Bulgaria—exposes the company to potential margin pressures if new tariffs or geopolitical issues arise.
- Dependence on console upgrades: The strategy that ties surgeon upgrades to the Apyx One Console with expectation of accessing AYON means that if uptake slows, it could hinder anticipated market momentum and revenue diversification.
| Metric | Period | Previous Guidance | Current Guidance | Change |
|---|---|---|---|---|
Total Revenue | FY 2025 | "$47.6 million to $49.0 million" | "$47.6 million to $49 million" | no change |
Advanced Energy Revenue | FY 2025 | "$39.6 million to $41.0 million" | "$39.6 million to $41 million" | no change |
OEM Revenue | FY 2025 | "Approximately $8 million" | "Approximately $8 million" | no change |
Gross Margins | FY 2025 | "Approximately 60%" | "Approximately 60%" | no change |
Total Operating Expenses | FY 2025 | "Not expected to exceed $40 million" | "Not expected to exceed $40 million" | no change |
| Topic | Previous Mentions | Current Period | Trend |
|---|---|---|---|
AYON System Launch | Consistently discussed in Q3 2024 and Q4 2024 with details on planned submission of 510(k), anticipated launch in the second half/back half of 2025, and positive surgeon feedback ( ) | Q1 2025 reinforced the planned launch in the back half of 2025, emphasizing FDA clearance as a condition, along with a structured ambassador program and positive physician feedback ( ) | Consistent emphasis. The narrative remains optimistic with similar launch timing, though FDA clearance uncertainties continue to be a critical dependency. |
Pipeline | Addressed in Q3 and Q4 2024, where the integrated platform with multiple technologies and its differentiation for aesthetic surgery were highlighted ( ) | Q1 2025 focused on the pipeline by noting increased demand for Apyx One Console upgrades tied to AYON, with the pipeline progression remaining contingent on FDA clearance ( ) | Stable with added nuance. The integration of the pipeline with console upgrades is maintained, but the dependency on FDA clearance remains a recurring risk. |
FDA Clearance Uncertainties | Covered in Q3 and Q4 2024 with an optimistic tone due to the presence of predicate devices and pre-submission feedback; however uncertainties around approval timing were still acknowledged ( ) | In Q1 2025, FDA clearance remains a central condition for the AYON launch and related activities, reinforcing its continued role as a gating factor ( ) | Consistent caution. The topic remains a key uncertainty affecting launch timing, with sentiment steady over the periods. |
Apyx One Console Upgrade Demand & Dependency Risks | Q3 2024 described decreased domestic upgrades, dependency on the console for AYON functionality, and discussed both international offsets and dependency risks; Q4 2024 further highlighted limited early upgrade demand and the risk that customers may delay upgrading ( ) | Q1 2025 reported that demand for upgrades is strong, driven by the excitement around AYON, with executives noting satisfaction in upgrade demand and less focus on dependency risks ( ) | Improving sentiment. While the dependency risk remains inherent, recent commentary shows stronger demand and a more optimistic view regarding upgrades. |
Supply Chain & Tariff/Geopolitical Risks | Not mentioned or addressed in Q2, Q3, and Q4 2024 ( ) | Q1 2025 introduced the topic by emphasizing dual manufacturing facilities in the U.S. and Bulgaria, and noted active monitoring of tariffs, highlighting flexibility to mitigate geopolitical risks ( ) | New emergence. This topic is newly emphasized in Q1 2025 reflecting an increased focus on mitigating supply chain and tariff-related risks that could have a significant future impact. |
Capital Equipment Performance Challenges & Cannibalization Risks | Q2, Q3, and Q4 2024 detailed soft market conditions, macroeconomic challenges (including GLP-1 effects), decreasing domestic upgrades, and cannibalization concerns between newer systems like Ayon and legacy products ( ) | Q1 2025 made only brief mention of stabilization in demand for capital equipment with improvements noted due to the benefits of Renuvion, with less detailed discussion on performance challenges or cannibalization ( ) | Less emphasized. While the challenges remain in the background, Q1 2025 shifts focus toward stabilization and positive capital trends, suggesting a moderated concern compared to earlier calls. |
Robust Disposable Handpiece & Consumable Sales Growth | Q2, Q3, and Q4 2024 consistently reported strong growth in disposable handpiece sales with double-digit increases and a significant contribution to Advanced Energy revenue ( ) | Q1 2025 reported strong sales growth in single-use handpieces contributing to a 6% increase in Advanced Energy products, continuing the positive trend ( ) | Highly positive. The robust growth across periods remains consistent and continues to be a strong driver for revenue, indicating sustained market demand. |
Operational Restructuring & Workforce Cost Optimization | Q3 and Q4 2024 described major restructuring measures including workforce reduction (nearly 25% in the U.S.), board changes, and expected cost savings, along with broader cost control efforts ( ) | Q1 2025 reiterated cost-cutting measures implemented six months prior, with positive initial restructuring results and continued focus on reducing cash burn ( ) | Consistently constructive. Ongoing restructuring measures show positive initial outcomes and an ongoing emphasis on cost discipline, which is likely to benefit future financial stability. |
Direct-to-Consumer (DTC) Strategy Enhancements & Brand Engagement | Q2 2024, Q3 2024, and Q4 2024 discussed a growing focus on DTC campaigns, strong influencer partnerships, significant media and social media impact, and brand engagement initiatives that boosted visibility and consumer trust ( ) | Q1 2025 continued to emphasize outstanding DTC marketing results, highlighted key influencer engagements (e.g. Dolores Catania as Chief of Confidence) and positive consumer response, reinforcing the brand's positioning ( ) | Steady and positive. The DTC strategy has evolved into a key component of the brand engagement approach, with consistently strong campaign performance and enhanced consumer outreach. |
New Customer Acquisition & Geographic Market Expansion | Q2 2024 provided insights on new customer acquisition with most system sales coming from new customers and mentioned future geographic expansion plans (e.g., potential in South Korea and China) ( ) | Q1 2025 did not specifically address new customer acquisition or geographic market expansion, with focus instead on product launches and internal demand drivers ( ) | Not addressed in current period. Although previously highlighted, new customer acquisition and geographic market expansion were not explicitly discussed in Q1 2025, possibly indicating a shift in focus toward product and operational execution. |
Macro Trends Impact including GLP-1 Effects & Seasonality Risks | Q2, Q3, and Q4 2024 discussed GLP-1 drug effects on procedural volumes, the resultant demand for loose skin treatments, and seasonal revenue patterns impacting capital equipment and overall performance ( ) | Q1 2025 reiterated macroeconomic headwinds from GLP-1 drugs—including significant patient impact—and acknowledged seasonality with Q1 and Q3 being lower revenue quarters, while emphasizing Renuvion as a key solution ( ) | Consistent with significant impact. The macro trends continue to shape the market landscape, with GLP-1 effects presenting both a challenge and an opportunity, and seasonality remaining a predictable factor in revenue projections. |
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Margin Outlook
Q: Tariff impact on margins?
A: Management indicated that despite potential tariff challenges, they expect gross margins to remain around 60% for the full year, signaling stability in their profitability. -
AYON Investment
Q: How invest for AYON launch?
A: Management explained that while they remain vigilant with expense controls and cash management, they will continue to allocate capital to support the AYON launch, ensuring its growth without compromising overall cost discipline. -
Apyx One Upgrades
Q: Are Apyx One upgrades progressing?
A: Management confirmed healthy demand, noting that customers are actively upgrading to the Apyx One, effectively queuing for the upcoming AYON system. -
AYON Pipeline
Q: What is the AYON launch progress?
A: They have finalized a list of 20 AYON ambassadors nationwide, ready to install and begin using the system as soon as FDA clearance is obtained. -
Supply Flexibility
Q: How is supply chain managed amid tariffs?
A: They maintain flexibility by leveraging manufacturing facilities in both the US and Bulgaria, which allows them to adjust sourcing as needed to ease tariff impacts.
Research analysts covering Apyx Medical.