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DELCATH SYSTEMS, INC. (DCTH)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 revenue was $19.8M with gross margin at 86% and diluted EPS of $0.03; both revenue and EPS exceeded S&P Global consensus estimates ($16.83M revenue*, $0.015 EPS*) driven by accelerating HEPZATO adoption and center activations . Values retrieved from S&P Global.
  • HEPZATO revenue reached $18.0M (U.S.), CHEMOSAT $1.8M (EU); net income positive at $1.1M and operating cash flow positive at $2.2M, marking the first profitable quarter and positive operating cash generation .
  • Active U.S. treatment centers rose to 19 (from 16 in Q4), with ~2 treatments per site per month and 10 additional centers accepting referrals, supporting visibility to the 30-center year-end goal .
  • Post-quarter, management issued FY 2025 guidance: total revenue $94–$98M, gross margin 83–85%, and positive adjusted EBITDA and cash flow in each quarter; entry into the Medicaid National Drug Rebate Agreement (NDRA) expected to expand access (effective early Q3 2025) .

What Went Well and What Went Wrong

What Went Well

  • First profitable quarter: “We achieved our first quarter of net income and positive operating cash flow, underscoring the accelerating clinical adoption of HEPZATO” — Gerard Michel, CEO .
  • Commercial execution: 19 active U.S. centers with 10 accepting referrals; per-site utilization ~2 treatments/month; European revenue up 29% QoQ to $1.8M despite pricing constraints .
  • Operating leverage: 86% gross margins and non-GAAP adjusted EBITDA of $7.6M, reflecting scale benefits and disciplined cost of goods .

What Went Wrong

  • Opex ramp: SG&A expected to increase ~60% YoY and R&D ~150% YoY in 2025, as trials and commercial expansion scale, tempering margin expansion near term .
  • Europe remains constrained: Management expects the European market “not be a significant contributor” near term; EU pricing is ~1/7 U.S. price; reimbursement outside Germany limited, with U.K. submission pending .
  • Utilization ramp lag: New high-potential centers (e.g., Miami, Cleveland Clinic) often experience ~6-month “wait-and-see” before hitting stride; near-term per-site pace guided to just under two treatments/month .

Financial Results

MetricQ1 2024Q3 2024Q4 2024Q1 2025
Revenue ($USD)$3.1M $11.2M $15.1M $19.8M
Diluted EPS ($USD)$(0.45) $0.06 $(0.11) $0.03
Gross Margin (%)71% 85.4% (9,560/11,200) 86% 86%
Net Income ($USD)$(11.1)M $1.864M $(3.398)M $1.069M
Adjusted EBITDA (Non-GAAP) ($USD)n/an/a$4.636M $7.552M

Segment revenue breakdown:

Segment Revenue ($USD)Q3 2024Q4 2024Q1 2025
HEPZATO (U.S.)$10.0M $13.7M $18.0M
CHEMOSAT (EU)$1.2M $1.4M $1.8M

Operational KPIs:

KPIQ3 2024Q4 2024Q1 2025
Active U.S. Centers12 16 19
Centers Accepting Referralsn/a8 10
Treatments per Site per Monthn/aSlightly under 2 ~2
Operating Cash Flow ($USD)$(3.6)M burn (Q3) $(1.0)M burn $2.2M
Cash & Investments ($USD)$14.0M $53.2M $58.9M

Estimate comparison (S&P Global):

MetricQ3 2024 EstimateQ3 2024 ActualQ4 2024 EstimateQ4 2024 ActualQ1 2025 EstimateQ1 2025 Actual
Revenue ($USD)$10.46M*$11.20M $14.96M*$15.10M $16.83M*$19.78M
Primary EPS ($USD)$(0.20)*$0.06 $(0.0167)*$(0.11) $0.015*$0.03

Values retrieved from S&P Global.

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Total RevenueFY 2025None$94–$98M Initiated
Gross MarginFY 2025None83%–85% Initiated
Adjusted EBITDAFY 2025NonePositive each quarter Initiated
Operating Cash FlowFY 2025NonePositive each quarter Initiated
Access (NDRA/340B)Effective early Q3 2025NoneNDRA to enable Medicaid rebates/340B pricing New program

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3 2024, Q4 2024)Current Period (Q1 2025)Trend
Center Activations & ScaleQ3: 12 active centers, strong adoption ; Q4: 16 active, expansion to 6 regions, >half new centers in 2H’25 19 active centers; 10 accepting referrals; cadence ~4 new per quarter Improving
Utilization per SiteQ4: slightly under 2/month ~2/month, guided to just under 2/month for 2025 Stable
European Contribution & ReimbursementQ3/Q4: strategic, modest growth; pricing/reimbursement constraints; Germany reimbursed; U.K. private pay 29% QoQ growth to $1.8M; Europe will “not be significant contributor” near term; U.K. reimbursement submission pending Improving but constrained
PricingQ4: price increased to ~$187.5k on Feb 1; inflation-linked Price in Q1 midpoint ~$185k; guidance on inflation constraints Incremental
Patient Accessn/a in Q3; Q4: expanding field support, coding/claims assistance HEPZATO KIT Access 360 launched for copay assistance/financial support Improving
R&D PipelineQ4: IND cleared for CRC; CHOPIN PFS expected 2H’25; basket IO sequencing concept IND cleared for mBC; both Phase 2 trials to start by end-2025; endpoints and market sizes detailed Expanding

Management Commentary

  • “Consistent revenue growth and the continued expansion of active treatment centers represent a strong start to 2025… We achieved our first quarter of net income and positive operating cash flow, underscoring the accelerating clinical adoption of HEPZATO” — Gerard Michel, CEO .
  • “Revenue from our sales of HEPZATO was $18 million, and CHEMOSAT was $1.8 million… gross margins of 86%… Non-GAAP adjusted EBITDA for the first quarter was $7.6 million… as of today, we have no outstanding debt obligations and no outstanding warrants” — Sandra Pennell, CFO .
  • “We expect the average monthly treatment per site to be just under 2 for the remainder of the year” — Gerard Michel, CEO .
  • “Our decision to enter into the NDRA simplifies Medicaid access and enables eligible hospitals to access 340B drug pricing… we expect total HEPZATO treatment volume in 2025 to increase at least 200% versus 2024” — Gerard Michel, CEO (Guidance PR) .

Q&A Highlights

  • Center activation cadence: Expect roughly four centers per quarter, with Q2 likely to add 2–3; guidance still targets ~30 centers by year-end despite activation variability .
  • Utilization ramp: High-patient centers show initial lag (~6 months) before scaling; company keeps per-site cadence just under two/month for modeling prudence .
  • Opex outlook and EBITDA: SG&A +~60% YoY and R&D +~150% YoY in 2025 (incl. stock comp); EBITDA margin was ~30% in Q1, with intention to remain EBITDA-positive while funding trials .
  • Europe strategy: Limited reimbursement (mainly Germany); U.K. reimbursement submission expected with low pricing relative to U.S. (~1/7), managing region near breakeven to maximize clinical data .
  • Treatment cycles per patient: Real-world tracking suggests ~4–4.1 cycles on average, similar to FOCUS trial; a key revenue driver .
  • Price: Raised from ~$182.5k (Jan 1) to ~$187.5k (Feb 1), future increases tied to inflation limits .

Estimates Context

  • Q1 2025 beat: Actual revenue $19.8M vs S&P Global consensus $16.83M*; diluted EPS $0.03 vs $0.015*; strong U.S. HEPZATO adoption and center activations drove the outperformance . Values retrieved from S&P Global.
  • Prior quarter checks: Q4 2024 revenue $15.1M vs $14.96M*; Q3 2024 revenue $11.2M vs $10.46M*; EPS results similarly better than consensus for Q3, below consensus for Q4 given launch ramp dynamics . Values retrieved from S&P Global.
  • Implications: Consensus likely needs to move higher for FY 2025 following formal guidance ($94–$98M revenue; gross margin 83–85%) and NDRA access catalyst .

Key Takeaways for Investors

  • HEPZATO adoption inflecting: Sequential revenue growth with 86% gross margins and first positive EPS/cash from operations; operational leverage evident .
  • Visibility to network scale: 19 active centers and 10 in queue underpin the 30-center year-end target; per-site cadence ~2/month supports sustained sequential growth .
  • Guidance sets a higher bar: FY 2025 revenue $94–$98M and positive adjusted EBITDA/cash flow each quarter; watch NDRA start (early Q3) for access/volume acceleration .
  • Trials expand TAM: IND cleared for mBC; CRC Phase 2 and mBC Phase 2 expected to start by end-2025; large addressable markets (~7k each U.S. annually) could transform medium-term mix if successful .
  • European upside contingent on reimbursement: Expect modest growth; step-change possible with U.K./other market reimbursement approvals; strategic value primarily clinical data .
  • Cost ramp manageable: SG&A and R&D will rise to support trials and expansion; management still expects EBITDA positivity, but margin targets intentionally flexible .
  • Near-term catalysts: CHOPIN PFS (mUM, NL) expected later this year, NDRA effective early Q3 2025, continued center activations; these should influence sentiment and potential estimate revisions .

Additional Context and Sources

  • Q1 2025 earnings press release and 8-K (Item 2.02): Revenue, margin, EPS, segment mix, cash/OCF, balance sheet detail .
  • Q1 2025 earnings call transcript: Prepared remarks and Q&A across commercial cadence, utilization, pricing, EU, trials, and opex outlook .
  • Q4 2024 results and call: Prior quarter baselines, SG&A/R&D commentary, EU dynamics, trial timelines .
  • Q3 2024 results: Sequential revenue/center activation; supplemental baseline .
  • Other Q1 2025 press releases: IND clearance for mBC; FOCUS randomized comparative analysis publication; earnings call notice .

Values retrieved from S&P Global.