MedAvail Holdings, Inc. (MDVL)·Q3 2022 Earnings Summary

Executive Summary

• Q3 revenue grew 98% year over year to $11.5M, with retail pharmacy revenue +105% and technology revenue ~flat; gross margin improved to 11.3% from 8.2% in Q2, while net loss per share narrowed to $(0.15) from $(0.34) a year ago .
• MedAvail exceeded its 100 dispensing MedCenters milestone (103 net dispensing deployments) and raised 2022 guidance for net new dispensing deployments to at least 40 (from 30–35), while maintaining full‑year revenue guidance of at least $42M .
• Operating loss remained elevated at $(11.5)M amid scale-up costs; management highlighted 26% cash burn reduction versus Q4’21 and 10% y/y pharmacy operating cost savings, excluding non‑cash amortization .
• Nasdaq notified MDVL on Oct 31, 2022 of non‑compliance with the $1.00 minimum bid price; the company has until May 1, 2023 (with potential extension) to regain compliance, a headline risk for shares .

What Went Well and What Went Wrong

• What Went Well

  • Exceeded deployment target and footprint expansion: “We achieved and exceeded our target of 100 dispensing MedCenters,” ending Q3 with 103 dispensing and 104 cumulative deployments .
  • Gross margin progression and cash discipline: “Delivered gross margin expansion for the second consecutive quarter” to 11.3% and achieved 26% savings over Q4’21 cash burn rate; management sees “a clear pathway to deliver long‑term profitable growth” .
  • Partnerships and pipeline: Expanded with Cano Health (nine additional SpotRx in South Florida) and new agreements with Aegis (Orlando) and PharmCo Rx (five MedCenters), supporting future placement momentum .

• What Went Wrong

  • Losses remain sizable: Operating loss of $(11.5)M and net loss of $(11.8)M persist as scale-up continues; interest expense rose y/y with higher rates (10.25% on term loan at 9/30) .
  • Going concern language: Significant ongoing cash needs and dependence on additional capital raise “substantial doubt” about ability to continue as a going concern despite recent financings .
  • Listing risk: Nasdaq minimum bid price deficiency letter increases equity and liquidity risk if compliance is not regained or if a reverse split is required .

Financial Results

Segment revenue breakdown

Key KPIs

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “During the third quarter, we made significant progress on our key milestones – we achieved and exceeded our target of 100 dispensing MedCenters, delivered gross margin expansion for the second consecutive quarter, and reached savings of 26% on our cash burn rate over the fourth quarter of 2021.” – Mark Doerr, CEO .
• “Looking ahead to the remainder of 2022 and beyond, we are confident that we are well positioned with a clear pathway to deliver long‑term profitable growth, as we continue our focus and strong execution across our strategic priorities.” – Mark Doerr, CEO .

Q&A Highlights

• The full Q3 2022 earnings call transcript could not be retrieved due to a source document retrieval issue; as a result, Q&A details and any guidance clarifications from the live discussion are unavailable in this recap. Financial and strategic insights above are drawn from the Q3 2022 press release and 10‑Q filing .

Estimates Context

• Wall Street consensus (S&P Global) estimates for Q3 2022 EPS and revenue were unavailable for MDVL in our S&P Global feed at the time of analysis (missing CIQ mapping). As a result, we cannot present a vs‑consensus comparison for the quarter.

Key Takeaways for Investors

• Execution on placements continues to improve, with Q3 surpassing the 100 dispensing sites milestone and a raised 2022 deployment target—supporting revenue visibility into 2023 from embedded clinic presence .
• Sequential gross margin expansion and a smaller adjusted EBITDA loss indicate operating leverage is beginning to emerge as scale improves, though absolute losses remain high .
• Liquidity remains adequate near‑term ($27.2M cash), but going concern language underscores dependence on continued capital access and successful cost containment; monitor cash runway and financing plans closely .
• Nasdaq bid‑price deficiency introduces potential overhang (reverse split risk/delisting); track remediation steps and timeline into H1 2023 .
• Near‑term catalysts: additional partner site rollouts (Cano, Aegis, PharmCo Rx), continued gross margin gains, and evidence of reduced cash burn translating to narrower losses .
• Risk‑reward hinges on the pace of unit economics improvement at the clinic level and the company’s ability to fund growth without excessive dilution; diligence on per‑site contribution and payback remains critical .

Supporting Sources: Q3 2022 Form 10‑Q financial statements and MD&A ; Q3 2022 earnings press release ; Q2 2022 press release ; Nasdaq notice 8‑K .