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Cytosorbents Corp (CTSO)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 revenue was $9.5M (+10% YoY) with gross margin at 70%, driven by record distributor performance and near‑record direct sales ex‑Germany; operating loss improved to $2.9M, but net loss was $3.2M ($0.05 per share) .
  • Versus S&P Global consensus, revenue missed ($9.5M actual vs $10.0M estimate*) and EPS was slightly below (-$0.05 actual vs -$0.047 estimate*); adjusted EBITDA loss improved to $2.0M . Values retrieved from S&P Global.
  • Management implemented a ~10% workforce/cost reduction program (up to $0.9M charge) and amended its credit agreement to add $2.5M cash and extend the interest‑only period to 12/31/2026, with another $2.5M available and further extension to 6/30/2027 upon FDA approval of DrugSorb‑ATR .
  • Regulatory timeline reset: pre‑submission filed 11/7/2025; De Novo re‑submission planned for Q1 2026 and anticipated FDA decision mid‑2026 (vs prior target of 2025), a key stock narrative shift .

What Went Well and What Went Wrong

  • What Went Well

    • “Record sales in our distributor territories” and “near‑record performance in direct sales outside Germany” drove 10% YoY growth and 70% gross margin .
    • Adjusted net loss improved to $2.6M ($0.04/share) and adjusted EBITDA loss narrowed to $2.0M; operating loss improved to $2.9M vs $4.8M LY .
    • Liquidity and flexibility enhanced via Avenue Capital amendment: $2.5M immediate funding; interest‑only extended to 12/31/2026; additional $2.5M contingent on FDA approval .

  • What Went Wrong

    • Direct German market declined; ongoing reorganization indicates continued near‑term execution risk in the largest EU device market .
    • Regulatory timeline push: FDA appeal upheld prior denial, necessitating a new De Novo filing; decision now anticipated mid‑2026 (vs earlier 2025) .
    • Q3 revenue missed consensus and EPS was slightly below; cash declined to $9.06M at quarter‑end (from $11.73M in Q2) as net operating cash burn was ~$2.6M in the quarter . Values retrieved from S&P Global.

Financial Results

MetricQ3 2024Q1 2025Q2 2025Q3 2025Q3 2025 ConsensusNotes
Revenue ($USD Millions)$8.613 $8.727 $9.617 $9.485 $10.019*Miss vs consensus; +10.1% YoY
Diluted EPS ($USD)$(0.05) $(0.02) $0.03 $(0.05) $(0.0467)*Slight miss vs consensus
Gross Margin %61% 71% 70.9% 70% n/a900 bps YoY expansion
Operating Loss ($USD Millions)$(4.830) $(3.887) $(3.615) $(2.862) n/aSequential improvement
Adjusted Net Loss ($USD Millions)$(4.527) $(3.674) $(3.660) $(2.618) n/aNon‑GAAP improvement
Adjusted EBITDA ($USD Millions)$(3.556) $(2.700) $(2.640) $(2.010) n/aTrend improvement

Values retrieved from S&P Global for consensus cells marked with *.

Segment/Channel KPIs (TTM through Q3 2025):

Channel (TTM)Value ($USD Millions)Commentary
Distributor & Partner Sales$15.6 +14% YoY; record distributor territories
Direct Sales Outside Germany$8.8 Near‑record performance
Germany (Direct)$12.6 Down ~3% YoY; reorganization underway
Core Product Revenue (TTM)$37.0 +9% YoY overall; +17% ex‑Germany

Additional KPIs:

KPIQ1 2025Q2 2025Q3 2025
Total Cash, Cash Equivalents & Restricted Cash ($USD Millions)$13.110 $11.726 $9.058
Net Operating Cash Burn (Quarter) ($USD Millions)~$(3.7) (narrative) ~$(3.1) (ex‑NJEDA proceeds) $(2.6)
SG&A ($USD Millions, quarter)$8.432 $9.167 $8.610
R&D net of grants ($USD Millions, quarter)$1.663 $1.262 $0.918

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Operating Cash Flow Breakeven TimingCompany“Near breakeven as we exit 2025” Breakeven beginning Q1 2026 Lowered (timeline pushed)
Regulatory – DrugSorb‑ATR FDAU.S.Final regulatory decision expected in 2025 Pre‑submission filed 11/7/2025; De Novo re‑submission Q1 2026; decision mid‑2026 Lowered (schedule deferred)
Credit FacilityBalance Sheet$5M second tranche available upon FDA approval by 12/31 +$2.5M immediate; interest‑only to 12/31/2026; +$2.5M and further extension to 6/30/2027 upon FDA approval Raised liquidity/extended IO period
Cost ActionsCompanyCost controls ongoing ~10% workforce reduction; up to $0.9M restructuring charge New formal program
Gross Margin OutlookCompany~71% with opportunity to improve 70% normalized; opportunity for expansion with efficiencies/volume Maintained qualitative outlook

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 & Q2)Current Period (Q3)Trend
Germany Commercial ReorganizationAnticipated disruption Q1; targeting H2 return to growth; execution focus Continued decline in direct Germany; restructuring in progress; expect improvements in 2026 Stabilizing actions; recovery pushed
Gross Margin Trajectory~71% with potential improvement via production efficiencies; disappointed but opportunity 70% in Q3; CFO sees opportunity to expand as volumes rise and efficiencies improve Stable; potential expansion
DrugSorb‑ATR Regulatory PathExpected 2025 decisions; appeal filed; Health Canada reconsideration Pre‑submission 11/7/2025; De Novo Q1 2026; decision mid‑2026 (Breakthrough device priority review) Timeline deferred; path clarified
Cost Discipline & BreakevenNear‑breakeven targeted by end‑2025; cash/liquidity strengthened (rights offering, NJEDA) Formal workforce/cost reduction to achieve breakeven in Q1 2026; cash burn improved Intensified cost actions
Clinical Evidence & SepsisStrong data pipeline; webinars; STAR registry; DOAC removal paper Additional RCT/real‑world data; World Sepsis Day webinar highlights broader impacts Momentum building

Management Commentary

  • CEO: “We are pleased with our third quarter results led by record sales in our distributor territories, strong sales in our other direct markets, and improved operating margins and cash efficiencies across the company” .
  • CEO on Germany: “This strong sales growth was partially offset by a decline in our direct German market…we believe [reorganization] will lead to improved performance and execution in 2026” .
  • CFO: “The actions taken include a workforce reduction of approximately 10%…which we believe will allow us to achieve cash flow break-even beginning in Q1” .
  • CFO on margins: “We are pleased with the 70% level…we do see possibilities for expansion of gross margin in the future” .
  • Regulatory: “Pre‑submission…filed on November 7, 2025…formal De Novo submission in Q1 2026…decision anticipated by mid‑2026…may be expedited under…Breakthrough Device Designation” .

Q&A Highlights

  • Gross margin outlook: Management expects opportunities for margin expansion with volume and plant efficiencies; DrugSorb approval would be higher margin .
  • German sales restructuring: Too early for quant targets; management tracking rep productivity and efficiency; expects future improvement .
  • FDA pre‑submission vs full application: Pre‑sub aligns with FDA on requirements; final De Novo will incorporate FDA feedback and new real‑world analyses .
  • Sepsis webinar feedback: Strong international response; messaging emphasizes early, intensive CytoSorb use to control inflammation and enable fluid removal .

Estimates Context

  • Q3 2025 actual vs consensus: Revenue $9.485M vs $10.019M* (miss), EPS $(0.05) vs $(0.0467)* (slight miss). Values retrieved from S&P Global.
  • Forward quarters: Q4 2025 revenue estimate $10.377M*, EPS $(0.0467); Q1 2026 revenue estimate $9.687M, EPS $(0.04); EBITDA consensus for Q1 2026 $(1.085)M; target price consensus $5.25* with limited coverage count [GetEstimates]. Values retrieved from S&P Global.
  • Implications: Given regulatory deferral to mid‑2026 and cost program timing, street models may adjust commercialization spend cadence and push breakeven assumptions; margin narrative stable at ~70% with upside on execution .

Key Takeaways for Investors

  • Channel strength ex‑Germany is intact, but Germany remains the swing factor in near‑term growth; restructuring pushes visible improvement into 2026 .
  • The revenue/EPS miss vs consensus underscores sensitivity to distributor order timing and German direct sales; watch Q4 seasonality and order cadence. Values retrieved from S&P Global.
  • Cost reduction and credit amendment add runway; interest‑only extension to 12/31/2026 and conditional capital upon FDA approval de‑risk liquidity .
  • Regulatory path clarity reduces process risk but extends timing; catalysts shift to pre‑sub feedback (Q4/Q1), Q1 2026 filing, and mid‑2026 decision .
  • Gross margin at ~70% with noted efficiency opportunities; DrugSorb, if approved, could be accretive to margin mix .
  • Clinical data momentum (sepsis, CABG on antithrombotics) supports medium‑term adoption narratives; aligns with EU reimbursement efforts .
  • Trading lens: Near‑term sentiment hinges on German recovery signals and pre‑sub feedback; medium‑term thesis pivots on execution of cost program and DrugSorb regulatory milestone timing.
References:
- Q3 press release and financial statements: **[1175151_20251113NY24252:0]** **[1175151_20251113NY24252:1]** **[1175151_20251113NY24252:2]** **[1175151_20251113NY24252:8]** **[1175151_20251113NY24252:10]**
- Q3 8-K (Item 2.02), exhibit press release, and financials: **[1175151_0000929638-25-004243_a8k.htm:1]** **[1175151_0000929638-25-004243_exhbit99-1.htm:1]** **[1175151_0000929638-25-004243_exhbit99-1.htm:2]** **[1175151_0000929638-25-004243_exhbit99-1.htm:8]** **[1175151_0000929638-25-004243_exhbit99-1.htm:9]** **[1175151_0000929638-25-004243_exhbit99-1.htm:12]**
- Q3 earnings call transcript: **[0001175151_2298496_1]** **[0001175151_2298496_3]** **[0001175151_2298496_4]** **[0001175151_2298496_5]** **[0001175151_2298496_6]**
- Q2 press release/8-K/call: **[1175151_20250807NY46935:0]** **[1175151_20250807NY46935:7]** **[1175151_20250807NY46935:9]** **[1175151_20250807NY46935:10]** **[1175151_0000929638-25-002927_exhbit99-1.htm:0]** **[1175151_0000929638-25-002927_exhbit99-1.htm:7]** **[1175151_2065014_6]** **[1175151_2065014_10]**
- Q1 press release/8-K/call: **[1175151_20250514NY88342:0]** **[1175151_20250514NY88342:7]** **[1175151_20250514NY88342:9]** **[1175151_0001104659-25-048520_tm2515144d1_ex99-1.htm:0]** **[1175151_0001104659-25-048520_tm2515144d1_ex99-1.htm:7]** **[1175151_CTSO_3428601_7]** **[1175151_CTSO_3428601_15]**
- Regulatory update press release (Sept 16, 2025): **[1175151_20250916NY74492:0]** **[1175151_20250916NY74492:1]** **[1175151_20250916NY74492:2]**

Values retrieved from S&P Global for consensus cells marked with *.