Movano Inc. (MOVE)·Q2 2024 Earnings Summary

Executive Summary

• Q2 2024 revenue was $0 as previously deferred revenue was offset by customer refunds; shipments totaled 1,837 Evie Rings and operating loss improved year over year to $6.4M from $7.4M in Q2 2023 .
• Management focused on three catalysts: Sept. 17 “back in stock” Evie Ring relaunch, FDA 510(k) clearance path for EvieMED (mid‑August agency meeting), and initial B2B opportunities with pharma and payor partners; later, on Sept. 3, the company reported a positive FDA meeting outcome and moving to the final review phase (post-quarter) .
• Product and operations were meaningfully strengthened: deep-learning heart-rate-in-motion accuracy, expanded AI insights, improved production yields/logistics, and Android app targeted by Black Friday; management expects these to enhance D2C relaunch conversion and customer experience .
• Liquidity improved with cash of $16.9M at quarter end following the $24.1M April private placement; cash burn ~$4.4M excluding payables catch-up; turnkey manufacturing agreement expected to improve working capital alignment .
• Near-term stock reaction catalysts: back-in-stock relaunch execution, FDA clearance timeline for EvieMED, and concrete B2B agreement announcements with pharma/payers .

What Went Well and What Went Wrong

What Went Well

• Management advanced B2B pipeline: agreement phase with a global pharma (late‑2024 start), Tier 1 pharma evaluation in Fall for 2025 trial, and engagement with a large payor for high‑risk population RPM (late‑2024/early‑2025 start) .
• Operational improvements across production yields, cycle times, logistics/warehouse systems, and upgraded algorithms; expanded AI insights engine and customer support readiness for relaunch .
• Clinical/R&D progress: completed an arterial‑line cuffless blood pressure study in June; planning next study in Q4 2024; continued focus on multi‑analyte sensing and proprietary RF SoC roadmap .

Quote: “We are excited to be back in stock on the Evie Ring… improving the consumer experience across product, delivery and customer service in order to maximize our sales potential.” — CEO John Mastrototaro .

What Went Wrong

• Revenue was $0 in Q2 (refunds offset deferred revenue) and D2C orders were paused since mid‑February given capital constraints, impacting near-term top line .
• FDA 510(k) clearance timeline extended as the agency requested additional information regarding wellness aspects; meeting scheduled for mid‑August (later resolved positively post-quarter) .
• Shipments fell sequentially to 1,837 rings from ~5,305 in Q1, reflecting halted order intake and initial launch learnings that led to cancellations; management intends to avoid this with ample prebuilt inventory in Q3 relaunch .

Financial Results

KPIs and Balance Sheet

Notes:

• No revenue recognized in Q2 2024 due to refunds offsetting previously deferred revenue .
• Balance sheet reflects April private placement proceeds and payables catch‑up .

Estimates vs. Actuals

Consensus note: Wall Street consensus via S&P Global was unavailable at time of retrieval due to source limitations.

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “We are committed to working collaboratively with the FDA to obtain a 510(k) clearance for EvieMED, the cornerstone of our enterprise initiative.” — CEO John Mastrototaro .
• “We shipped 1,837 Evie Rings in the second quarter… The company did not report any revenue for the second quarter as previously deferred revenues [were] offset by refunds.” — CFO Jeremy Cogan .
• “We improved production yields and cycle times… updated our Ring algorithms… expanded our proprietary AI generated insights engine… [and] expect to have an Android version of the app ready… by Black Friday.” — CMO Tyla Bucher .
• “We are in the agreement phase with a global pharmaceutical company… EvieMED is expected to be evaluated this Fall by a Tier 1 global pharmaceutical company… engaged with a large payor…” — CEO John Mastrototaro .

Q&A Highlights

• Algorithms and features: Deep-learning HR‑in‑motion and auto activity detect will improve workout accuracy and user experience (Leabman/Bucher) .
• B2B engagements: Partners in provider/payer/RPM channels are in beta/initial agreements pending FDA clearance (Soule) .
• FDA timing/tone: No change to mid‑Aug meeting; seasoned regulatory advisors; strong clinical foundation; optimistic tone (Mastrototaro) .
• R&D learnings: June arterial‑line BP study yielded hardware/antenna and form factor updates; next arterial-line study targeted around November (Leabman) .
• Burn rate and manufacturing: Cash burn trending lower; turnkey manufacturing agreement to better align COGS with sales, improving cash flow profile (Cogan) .

Estimates Context

• S&P Global consensus for Q2 2024 revenue and EPS was unavailable at time of retrieval due to source limitations. As a result, estimate comparisons are not provided (see “Financial Results” table).
• Given zero revenue recognition in Q2 and pending D2C relaunch/FDA developments, we expect sell‑side models (where available) to pivot around Q3/Q4 volumes, gross margin trajectory post turnkey manufacturing, and B2B monetization milestones .

Key Takeaways for Investors

• Near-term binary catalysts: Sept. 17 back‑in‑stock D2C relaunch and progress toward EvieMED FDA clearance; watch for conversion, refund rates, and customer service efficacy as indicators of sustainable D2C scale .
• B2B optionality is growing: Pharma agreement phase and payer evaluations can diversify revenue away from D2C cyclicality; any signed contracts would be material sentiment drivers .
• Improved liquidity and operations: Post‑raise cash of $16.9M and turnkey manufacturing should smooth working capital and cost alignment; monitor quarterly burn trajectory and gross margin as D2C resumes .
• Product differentiation via AI and clinical evidence: Deep-learning algorithms and superior hypoxia trial accuracy underpin brand and regulatory narrative; quality improvements may aid retention and pricing power .
• Risk management: FDA process timing remains the primary execution risk; while the post‑quarter update was positive, clearance is not assured—position sizing should reflect regulatory path uncertainty .
• Trading lens: In the near term, stock likely reacts to D2C relaunch KPIs (orders, shipments, refunds, CSAT) and any FDA/partner newsflow; medium-term thesis hinges on converting clinical/RPM use cases into scalable B2B revenue .
• Watch Android app timing and feature rollout cadence through holiday season; these can amplify TAM and improve conversion during peak demand periods .