Q4 2024 Summary
Published Mar 11, 2025, 10:47 AM UTC- Myomo expects significant revenue growth in 2025, providing guidance of $50 million to $53 million, representing growth of 54% to 66% over 2024, driven by increased pipeline additions and higher advertising spend.
- Expansion of the O&P distribution channel, with over 160 Certified Prosthetist Orthotists trained in 2024 and plans to further scale this effort in 2025, is expected to contribute meaningfully to revenue growth in the second half of the year. Additionally, the company sees strong performance in the German market, with over 100 O&P clinical partners, indicating potential for continued international growth.
- A large addressable market of over 3 million cases of chronic arm paralysis in the U.S. offers significant growth potential. Management anticipates continued linear growth in the number of patient candidates, expecting to reach hundreds of thousands of eligible patients as awareness increases through higher advertising spend and referrals from therapists.
- Persistent challenges with insurance reimbursement, particularly with Medicare Advantage and commercial payers, leading to high rates of authorization denials, decreasing success rates of appeals, and lengthened timelines. Historically, the company had been winning about 40% to 50% of appeals, but this percentage has come down somewhat, and the time to resolution has lengthened to over two years in some cases , ,. This can negatively impact revenue recognition and cash flows.
- Increasing operating expenses, including a near doubling of advertising spend to over $6 million in 2025, and overall operating expenses expected to be higher than $10 million per quarter , ,. Without a corresponding increase in revenue, this could impact profitability.
- Uncertainty around potential impact of international tariffs, which could increase prices to O&P providers in Germany, possibly affecting demand , and limited near-term international growth beyond Germany due to time-consuming and costly processes to enter new markets.
| Metric | YoY Change | Reason |
|---|---|---|
Total Revenue | +154% (from $4.75M in Q4 2023 to $12.07M in Q4 2024) | Total Revenue surged by 154% YoY primarily due to a significant increase in product revenue driven by higher revenue units and an improved payer mix (including greater Medicare Part B participation), continuing the strong growth initiated in previous periods with similar trends seen in Q3. |
Direct-to-Patient Segment | +213% (from $3.14M in Q4 2023 to $9.84M in Q4 2024) | Direct-to-Patient revenue increased by 213% YoY as a result of a record number of revenue units and a higher Average Selling Price (approaching $57,200), amplifying the growth already observed in Q3 with successful Medicare Part B revenue recognition and enhanced marketing efficiency. |
Clinical/Medical Providers | +37% (from $1.63M in Q4 2023 to $2.23M in Q4 2024) | Clinical/Medical Providers revenue grew 37% YoY driven by broader product revenue gains and improved ASPs that built on previous period performance improvements in product demand and revenue unit increases, even as detailed segment-specific catalysts were less explicit. |
Cash and Cash Equivalents | Increased significantly (from $6.87M in Q4 2023 to $24.37M in Q4 2024) | Cash improved markedly due to a combination of enhanced financing activities and better operating cash flows that built upon previous period moves, resulting in a robust liquidity profile that contrasts sharply with the prior period’s lower balance. |
Net Loss | Near break-even (from $(2,460,104) in Q4 2023 to $(260) in Q4 2024) | Net Loss diminished dramatically as a result of the dramatic revenue increase, higher gross margins (for example, gross margin improvement from 68.7% to 75.4% in Q3) and controlled operating expenses, reflecting a turnaround in operational efficiency that extended prior period improvements to deliver near break-even results. |
| Metric | Period | Previous Guidance | Current Guidance | Change |
|---|---|---|---|---|
Revenue Guidance | Q4 2024 | $9.5 million to $10.5 million | no guidance | no current guidance |
Operating Cash Flow Breakeven | Q4 2024 | Expected to achieve operating cash flow breakeven | no guidance | no current guidance |
Adjusted EBITDA Breakeven | Q4 2024 | Expected to approach adjusted EBITDA breakeven | no guidance | no current guidance |
O&P Channel Contribution | Q4 2024 | Minimal contribution from the O&P channel | no guidance | no current guidance |
2025 Revenue Expectations | Q4 2024 | “If Q4 2024 revenue reaches $10 million, expect at least $40 million in revenue for 2025” | no guidance | no current guidance |
Revenue Guidance | FY 2024 | $30 million to $31 million | no guidance | no current guidance |
Q1 2025 Revenue | Q1 2025 | no prior guidance | $9 million to $9.5 million | no prior guidance |
Full-Year 2025 Revenue | FY 2025 | no prior guidance | $50 million to $53 million | no prior guidance |
Advertising Budget | FY 2025 | no prior guidance | Expected to nearly double to over $6 million | no prior guidance |
Capital Expenditures (CapEx) | FY 2025 | no prior guidance | $1 million or less | no prior guidance |
Gross Margin | FY 2025 | no prior guidance | Around 70% to 71% | no prior guidance |
Operating Expenses (OpEx) | FY 2025 | no prior guidance | “Quarterly OpEx is expected to be $10 million or higher, with full‐year likely exceeding $40 million” | no prior guidance |
Cash Flow | FY 2025 | no prior guidance | “Negative cash flows expected in Q1–Q3 with Q2 the highest burn and positive operating cash flow in Q4” | no prior guidance |
| Metric | Period | Guidance | Actual | Performance |
|---|---|---|---|---|
Q4 2024 Revenue | Q4 2024 | $9.5M – $10.5M | $12.07M | Beat |
FY 2024 Revenue | FY 2024 | $30M – $31M | $32.55M (sum of 3.75+ 7.52+ 9.21+ 12.07) | Beat |
Operating Cash Flow Breakeven | Q4 2024 | Expected to achieve operating cash flow breakeven | $3,365,728.00 | Beat |
| Topic | Previous Mentions | Current Period | Trend |
|---|---|---|---|
Revenue Growth and Pipeline Expansion | In Q1–Q3, revenue growth was steadily increasing with emphasis on higher unit sales, improved ASPs, and an expanding patient pipeline (e.g., Q1: modest growth with a record pipeline ; Q2: record pipeline and strong revenue unit increases ; Q3: record revenue and pipeline numbers with improved cost efficiency ). | Q4 shows record revenue numbers (e.g., $12.1 million in Q4 with a 154% YoY surge), a record pipeline (1,389 patients, up 33% YoY), and better cost efficiency (46% cost drop per pipeline add). | Consistent and accelerating growth. The focus on revenue figures and pipeline expansion remains strong, with sentiment shifting positively as growth and efficiency continue to improve. |
Manufacturing Capacity Expansion and Scaling Constraints | Across Q1–Q3, the company outlined plans to double or expand capacity—from targeting 80–100 units per month (Q1) to plans for new manufacturing facilities and capacity-doubling efforts (Q2 and Q3). | Q4 highlights a relocation to a new 35,000‑sq‑ft facility in Burlington that more than doubles capacity (120 units per month) and supports diversified production (clinical, demo, O&P). | Robust execution and infrastructure improvement. The discussions remain consistent but show concrete progress in Q4 as expansion plans become operational. |
Orthotics & Prosthetics (O&P) Channel Expansion and Ramp-Up Challenges | In Q1–Q3, there was a strong focus on training clinicians and onboarding O&P partners (e.g., 100 clinicians goal, incremental revenue, delayed ramp due to long lead times in patient evaluations and Medicare Advantage challenges). | Q4 reports exceeded training goals (160 certified clinicians), significant revenue growth (94% sequential increase to $600,000), and enhanced international traction, notably in Germany. | Optimistically evolving with continued hurdles. While challenges like reimbursement delays remain, expanding training and order growth indicate a cautiously positive outlook for the channel’s future impact. |
Insurance Reimbursement and CMS Payment Difficulties | Q1–Q3 highlighted recurring issues: slower authorizations from Medicare Advantage, underpayments, and delayed CMS payments contrasted with faster Medicare Part B reimbursements and some legal appeals wins that improved conversion. | Q4 continues to discuss persistent challenges—especially with Medicare Advantage claim denials and appeals—while noting strong performance with Medicare Part B and progress with new contracts (e.g., five new contracts with Blue Cross Blue Shield plans). | Mixed and persistent. The challenges remain similar across periods, though there is some progress in payer engagement and contract expansion; sentiment is cautiously balanced between improvement and enduring reimbursement headwinds. |
Operating Expense Increases and Margin Pressure from Elevated Advertising Spend | Throughout Q1–Q3, operating costs increased with headcount and R&D spending; advertising spend was raised moderately (Q1 and Q3 saw increases without significant margin pressure, aided by improved marketing efficiencies). | Q4 saw a sharper increase in operating expenses (+60% YoY to $8.9 million) and plans to nearly double advertising spend in 2025, although explicit margin pressure was not emphasized. | Heightened cost pressures. There is a clear trend toward higher expense growth as the company invests in growth channels, which may impact margins if revenue growth does not outpace the cost increases. |
International Market Risks and Tariff Impacts | Earlier periods (Q1–Q3) mentioned Germany as a bright spot with strong reimbursement and expanding networks but did not emphasize risks or tariffs. | Q4 introduces discussion of potential tariff risks in Germany—even though no immediate impacts exist—and acknowledges the time‐intensive nature of expanding into new international markets. | Newly emphasized potential risks. While international growth remains strong, Q4 brings a cautious note on future tariff and market risks that could significantly affect costs and market strategy. |
Backlog Management and Patient Conversion Drop-Out Risks | Q1–Q3 consistently tracked robust backlog growth and noted conversion drop-out rates (15%–20% in Q3; record backlogs in Q1 and Q2 with emphasis on the faster conversion of Medicare Part B patients). | Q4 data show a record backlog (272 patients, up 18% YoY) and record pipeline numbers, though there’s no explicit updated discussion on drop-out risk, implying similar underlying challenges remain managed as before. | Steady management with inherent risks. The topic remains critical with consistent metrics; while the backlog grows impressively, conversion drop-out risks are inherent but are being monitored using historical drop rates. |
Hiring and Supply Chain Constraints | From Q1 through Q3, hiring was emphasized to support scaling (with proactive recruitment of clinical, intake, and manufacturing staff) and supply chain risks were addressed through strategic ordering of long‐lead items, with little disruption reported. | Q4 reaffirms the commitment to aggressive hiring—evidenced by increased headcount and operational capacity—with no major supply chain constraints observed, and a reassurance that sourcing (most U.S.-based) remains stable. | Continued focus with improved execution. Hiring remains a priority as a driver for growth; supply chain concerns have been minimal throughout and continue to be effectively managed. |
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Pipeline Growth Potential
Q: Can pipeline adds increase further to drive revenue growth?
A: Management believes they have not reached their peak in pipeline adds and need to increase them to reach $50 million to $53 million in revenue. They are becoming more efficient with separate teams handling initial patient evaluations and regional CPOs focusing on delivering MyoPros. With increased advertising spend, they expect more patients to enter the top of the funnel. The potential market is large, with over 3 million cases of chronic arm paralysis in the U.S., leading to hundreds of thousands of eligible candidates. -
Gross Margin Outlook
Q: How should we think about gross margins in 2025?
A: Gross margins are expected to be around 70% to 71% in 2025. While the new facility adds some overhead, this is offset by a higher average selling price opportunity. -
Operating Expenses
Q: What is the expected level of operating expenses for 2025?
A: Operating expenses could be higher than $10 million per quarter. Management indicates that full-year OpEx will definitely start with a four, suggesting annual OpEx over $40 million. -
Reimbursement Environment
Q: How is the reimbursement environment expected to evolve in 2025?
A: Management expects the reimbursement environment to remain consistent with 2024. With Medicare Part B allowables and a price increase, as well as entering contracts with several state Blue Cross Blue Shield plans, the company anticipates an accelerated revenue cycle. Public pressure and investigations into Medicare Advantage plans may further improve the environment. -
O&P Channel Growth
Q: What growth is expected from the O&P channel in 2025?
A: The O&P channel generated approximately $1 million in revenue in 2024. While no specific guidance was given, management expects meaningful growth in this channel in 2025. The majority of revenue will still come from the direct provider channel, but they are seeing positive signs with revenues doubling from Q3 to Q4 and training over 160 clinicians. -
Advertising Spend and Cost per Pipeline Add
Q: How will advertising spend and cost per pipeline add impact growth?
A: The company plans to double the advertising budget to $6 million in 2025. The cost per pipeline add in Q4 was $1,226, and management is monitoring its efficiency. They may see a slight increase in cost per pipeline add due to changes made by Meta on Facebook. -
Capital Expenditures
Q: What CapEx is expected for 2025?
A: CapEx is expected to be around $1 million or less for 2025. Most of the CapEx related to the move to the new facility has been completed, with some additional spend as they move into the last 7,500 square feet by midyear. -
International Expansion
Q: What is the outlook for the international market in 2025?
A: The German market has performed very well, with many statutory health insurance plans covering MyoPro and over 100 O&P clinical partners trained and operational. The company expects continued growth in Germany and will continue to invest there. -
Denied Claims Recovery Rate
Q: What percentage of denied claims are recovered over time?
A: Historically, the company has won about 40% to 50% of denied claims over time. This percentage has decreased somewhat, and appeal timelines have lengthened. -
Tariffs Impact
Q: Are tariffs a risk to gross margins or German sales?
A: Management does not see any impact from tariffs on gross margins, as most components are sourced from the U.S., with minimal components from China. Currently, there are no tariffs affecting exports to Germany, but potential future tariffs could raise prices for O&P providers there.