Executive Summary

Revenue was $49.2M, essentially flat year-over-year, with procedure revenue growth accelerating sequentially to 7.8% and dietary supplements down 32.2% YoY; adjusted EBITDA was $12.7M (25.9% margin), down from $14.5M in Q2’23 due to stepped-up sales/marketing and legal costs .
Gross margin was 68.9% including a $1.2M inventory step-up from Asteria; excluding this, Q2’24 gross margin would have been 70.9%, with management guiding the second-half consolidated GM toward the “upper 60s” range .
2024 guidance was reiterated: revenue $200–$204M and adjusted EBITDA $60–$63M, with H2 strength expected from top-tier clinic performance, network expansion, quick-start clinics, and a return to YoY growth in nutraceuticals .
Cash fell to $26.4M from $78.8M in Q1 due to settlements/share repurchases with two large shareholders; operating cash flow was ~$17.3M in Q2, and the company will prudently fund future repurchases from operating cash .
Catalysts: BioteRx rollout (~600 clinics enrolled), Asteria integration/licensing progress, expected SG&A moderation, and second-half margin/EBITDA inflection; risks include GLP‑1 regulatory/supply dynamics and nutraceutical transition pacing .

What Went Well and What Went Wrong

What Went Well
- Sequential procedure revenue growth accelerated to 7.8% (vs. 6.6% in Q1), driven by top-tier clinics and ~30% new clinic growth YoY; “Biote generated solid financial performance in the second quarter” .
- BioteRx rollout tracking well, ~600 enrolled clinics; CEO: “We are pleased with the positive response … BioteRx … leveraging the latest technology and tools” .
- Gross margin improved YoY to 68.9% (would be 70.9% ex inventory step-up), reflecting product mix and cost management; H2 GM guided toward upper-60s .
What Went Wrong
- Adjusted EBITDA fell to $12.7M (25.9% margin) from $14.5M (29.5%) YoY on higher sales/marketing and legal expenses .
- Net loss was $(10.5)M, including a $(13.9)M loss from change in fair value of earnout liability; diluted loss per share was $(0.19) .
- Cash declined to $26.4M due to large share repurchases tied to litigation settlements; revolving loans increased to $10.0M .

Financial Results

Metric	Q4 2023	Q1 2024	Q2 2024
Total Revenue ($USD Millions)	$45.703	$46.804	$49.169
Product Revenue ($USD Millions)	$44.935	$46.035	$48.111
Service Revenue ($USD Millions)	$0.768	$0.769	$1.058
Procedure Revenue ($USD Millions)	$34.9	$37.4	$38.4
Gross Profit Margin %	69.4%	71.4%	68.9% (70.9% ex step-up)
Operating Income ($USD Millions)	$5.508	$10.427	$6.233
Adjusted EBITDA ($USD Millions)	$13.574	$14.158	$12.742
Adjusted EBITDA Margin %	29.7%	30.2%	25.9%
Net Income (Loss) ($USD Millions)	$12.078	$(5.810)	$(10.475)
Diluted EPS ($USD)	$0.18	$(0.06)	$(0.19)

Segment indicators and mix

Indicator	Q4 2023	Q1 2024	Q2 2024
Dietary Supplement Revenue YoY Change	(14.6%)	(11.3%)	(32.2%)
Procedure Revenue YoY/Seq Commentary	+6.6% YoY	+6.6% YoY	+7.8% Seq (from 6.6%)

Key KPIs

KPI	Q4 2023	Q1 2024	Q2 2024
Biote-certified practitioner network	>7,100	—	—
New clinics growth YoY	—	~30% (through H1)	~30% (through H1)
BioteRx clinics enrolled	—	—	~600 clinics
Operating cash flow ($USD Millions)	—	~$7.372 (Q1)	~$17.3 (Q2)
Cash & equivalents ($USD Millions)	$89.002 (YE)	$78.787	$26.419

Notes: Gross margin excludes step-up would be 70.9% in Q2’24 . Net loss figures include earnout/warrant fair value changes .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue ($USD Millions)	FY 2024	$200–$204	$200–$204	Maintained
Adjusted EBITDA ($USD Millions)	FY 2024	$60–$63	$60–$63	Maintained

Management also guided H2 consolidated gross margin toward the high end of historical “upper 60s” range, supporting H2 EBITDA margin step-up .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q4’23 and Q1’24)	Current Period (Q2’24)	Trend
BioteRx rollout & adoption	Launch announced; initial provider feedback positive . Phased launch since Feb; 10 new products; modest 2024 contribution via transaction fees .	~600 clinics enrolled; expansion planned into body composition, sexual wellness, non‑pellet optimization, thyroid/autoimmune .	Expanding footprint; increasing provider engagement.
Asteria Health integration & licensing	Acquisition closed; goal of vertical pellet manufacturing; licensing expansion underway .	Integration progressing; ~halfway to target licenses; building inventory; phased clinic transition in H2; GLP‑1 production capability targeted for 2025 .	Steady progress; manufacturing ramp phased; 2025 GLP‑1 line.
Procedure revenue growth	Stable ~6.6% in Q4/Q1; H2 acceleration expected .	Sequential acceleration to 7.8% Q2; expect stronger H2 growth from top-tier clinics, network expansion, quick starts .	Improving sequentially; H2 stronger.
Nutraceuticals transition & growth	Distributor exit pressured Q4’23; H1’24 low-single digit total revenue growth; nutra growth expected H2 .	Nutra down 32.2% YoY as transition continues; expected to resume YoY growth in H2 .	Near-term headwind; H2 recovery planned.
Gross margin trajectory	69.4% in Q4’23; 71.4% in Q1’24 (mix effects); anticipated reversion as nutra grows .	68.9% in Q2 (70.9% ex step-up); H2 guided upper-60s .	Normalizing with mix; H2 guided high end.
SG&A & investments	Q1 OpEx managed; sales force/data modernization priorities .	Q2 SG&A $27.6M incl. large provider event; SG&A expected to moderate H2; continued spend on training/Amazon demand-gen .	Step-up in Q2; moderation H2.
Legal settlements & share repurchases	Founder settlement; plan to repurchase 18.4M shares at avg $4.17; separate $20M buyback .	Settlements with two large holders; repurchased $32.2M (Apr) and $30.0M (Jun); remaining 14.4M shares over 3 years; cash dropped to $26.4M .	Deleveraging equity; cash usage elevated near term.
GLP‑1 supply/regulatory dynamics	—	CEO detailed FDA shortage criteria; branded supply tightness likely; platform fee model; not material near-term to P&L .	Manageable; demand persists; exposure diversified.

Management Commentary

“Biote generated solid financial performance in the second quarter, highlighted by a sequential increase in procedure revenue growth… we remain on track to achieve our 2024 financial guidance” — Teresa Weber, CEO .
“Second quarter gross profit margin was 68.9%… excluding inventory revaluation, would have been 70.9%… adjusted EBITDA decreased 12.4%… largely due to investments in sales and marketing” — Robert Peterson, CFO .
“We reiterate our previously reported guidance with revenue of $200M to $204M and adjusted EBITDA of $60M to $63M… we anticipate moderation in the second half operating expenses” — Robert Peterson, CFO .
“We have enhanced long-term shareholder value by concluding outstanding litigations and committing to significant share repurchases on favorable terms” — Teresa Weber, CEO .
“We are pleased with the positive response… BioteRx… introduced to approximately 600 clinics” — Press Release .

Q&A Highlights

GLP‑1 strategy and regulatory/supply: Management expects GLP‑1s to remain on FDA shortage lists given national demand/safety stock; platform fee model with diversified therapeutics minimizes risk; compounded GLP‑1 production capacity at Asteria targeted for 2025 .
Licensing and Asteria ramp: Approximately halfway through targeted state licenses; phased clinic conversion with inventory bleed-down; inventory build and machinery installs supporting near/medium-term demand .
Margins and EBITDA cadence: H2 gross margin guided to high end of historical upper-60s; EBITDA margin step-up expected from SG&A moderation and mix, reflected in full-year guide .
Sales/marketing investments: Q2 included a large provider event and education/training investments; SG&A expected to moderate in H2 while maintaining spend on revenue-generating activities (training, Amazon demand-gen) .
Practitioner mix and engagement: <10% in medical spa settings, very few purely virtual; strong adoption and order consistency among new practitioners leveraging BioteRx platform .

Estimates Context

Wall Street consensus estimates via S&P Global were unavailable at the time of this analysis due to a request limit error; as a result, we cannot assess beat/miss versus consensus for Q2’24. Values that would normally be retrieved are from S&P Global and were not accessible at the time of request.*

Key Takeaways for Investors

Sequential procedure revenue momentum and H2 guidance imply positive inflection on core business, aided by top-tier clinic growth and quick-start onboarding—watch for acceleration evidence in Q3/Q4 updates .
Margin dynamics should normalize near term: Q2 GM impacted by inventory step-up and mix; management guiding H2 consolidated GM to upper-60s, supporting EBITDA margin recovery .
BioteRx expansion (600 clinics) is a structural engagement driver; near-term P&L impact is modest (platform/transaction fees), but strengthens competitive positioning and cross-sell opportunities .
Asteria integration/licensing ramp is a medium-term lever for supply chain control and margin benefits; monitor state license cadence and pellet transition pace to clinics .
Nutraceutical transition remains a headwind in Q2 but is expected to turn to YoY growth in H2; execution on e-commerce and demand-gen (including Amazon) is key .
Capital allocation: Large settlement-driven repurchases reduce float and may be accretive, but draw down cash; company intends to fund ongoing repurchases prudently via operating cash—watch liquidity and revolver usage .
Trading implications: Near-term performance hinges on confirmation of H2 margin/EBITDA step-up and procedure growth trajectory; any updates on GLP‑1 regulatory status or BioteRx adoption could drive sentiment .

biote Corp. (BTMD)·Q2 2024 Earnings Summary