Executive Summary

Q1 revenue grew 17% YoY to $59.1M with diluted EPS of $0.06; adjusted EBITDA rose 26% YoY to $12.8M, and management tightened FY25 guidance by raising the low end on both revenue and adjusted EBITDA ranges .
Mix shift toward CapEx-light sleep and staffing tempered gross margin to 56% (from 60% in Q4 and 59% in Q1’24), but management emphasized this supports EBITDA and cash flow leverage as the model diversifies .
Results were broadly in line with company expectations but modestly below S&P Global revenue consensus ($59.13M actual vs $60.60M consensus*) while EPS matched consensus at $0.06*; management still expects 5%–9% sequential revenue growth in Q2–Q4 .
Strategic catalysts: ventilator fleet swap nearing completion (benefiting capital efficiency), pending acquisition of Lehan’s Medical Equipment (expected Q3 close; not in guidance), and CMS’s proposed NCD for NIV trending constructively; management raised the lower end of FY25 guidance and signaled continued hiring/investment in sales .

What Went Well and What Went Wrong

What Went Well

Balanced growth across businesses: Vent revenue down only ~3% sequentially in a seasonally tough quarter and up ~10% YoY; sleep therapy patients +7% QoQ and +46% YoY; staffing reached ~10% of revenue, reflecting diversification and demand .
Sales force restructuring from 2024 is paying off: “We are ahead of pace on increasing the sales team and expanding into new territories,” with new vent patient starts +9% sequentially; management raised the low end of FY25 revenue and EBITDA guidance .
Strong liquidity and funding flexibility: $10.2M cash, no net debt, and $55M available on credit facilities; ventilator exchange program largely financed via buyback from supplier and expected to conclude in 1H25 .

What Went Wrong

Gross margin compression to 56% (from 60% in Q4 and 59% in Q1’24) driven by mix shift toward sleep and staffing; management frames this as a trade-off for faster growth and stronger EBITDA/cash generation over time .
Seasonal headwinds: Q1 impacted by utilization/deductible dynamics and resupply seasonality (sleep resupply patients down 6% sequentially), consistent with “toughest quarter” narrative .
VA channel discontinued: Management stated the VA opportunity is “dead” for now given administrative churn; no current pursuit in that channel .

Financial Results

Headline P&L and Profitability (oldest → newest)

Metric	Q1 2024	Q4 2024	Q1 2025
Revenue ($USD Millions)	$50.59	$60.70	$59.13
Gross Profit ($USD Millions)	$29.80	$36.14	$33.28
Gross Margin (%)	59%	60%	56%
Net Income Attributable ($USD Millions)	$1.60	$4.32	$2.63
Diluted EPS ($)	$0.04	$0.10	$0.06
Adjusted EBITDA ($USD Millions)	$10.10	$14.24	$12.77

Segment and Revenue Mix (oldest → newest)

Revenue Category ($USD Millions)	Q1 2024	Q4 2024	Q1 2025
Ventilator rentals (NIV & invasive)	$29.19	$33.17	$32.16
Other HME rentals	$10.93	$13.05	$12.96
Equipment & supply sales	$6.14	$8.94	$7.52
Service revenues	$4.33	$5.54	$6.49
Total Net Revenues	$50.59	$60.70	$59.13

KPIs and Balance Sheet (oldest → newest)

KPI	Q1 2024	Q4 2024	Q1 2025
Vent patients (period-end)	10,450	11,795	11,809
PAP therapy patients	15,726	21,338	22,899
Sleep resupply patients	18,904	24,478	22,941
Cash & Equivalents ($M)	$7.31	$17.54	$10.16
Working capital ($M)	n/a	$15.55	$13.63
Net Capex ($M)	$5.37	$8.95	$8.53

Notes:

Q1 is typically seasonal; Q1 2025 gross margin 56% reflects mix shift toward sleep and staffing .
Q1 2025 included a $2.4M gain largely from the ventilator return program; management expects these gains through end of Q2 with the program concluding in June .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Net Revenue	FY 2025	$254M–$265M	$256M–$265M	Raised (higher low end)
Adjusted EBITDA	FY 2025	$54M–$58M	$55M–$58M	Raised (higher low end)

Additional cadence assumptions: sequential revenue growth of 5%–9% in Q2–Q4; adjusted EBITDA margin 21%–23%; guidance excludes Lehan’s (expected Q3 close) .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q3’24 and Q4’24)	Current Period (Q1’25)	Trend
Sales org restructuring/hiring	Q3’24: Sales restructuring and efficiencies driving organic growth ; FY’24: momentum from sales force and diversification	Ahead of hiring plan; new vent starts +9% QoQ; continued territory expansion	Improving execution
Mix shift and margins	Q3’24 gross margin 59% ; Q4’24 60%	56% gross margin; mix shift to sleep/staffing; focus on EBITDA/cash leverage	Lower GM, higher EBITDA leverage
Ventilator fleet exchange	Not highlighted in Q3 8-K; FY’24 capex elevated with fleet replacement	Net capex $8.5M; $2.4M gain from returns; program expected to end in Q2	Nearing completion
Regulatory (CMS NIV NCD)	–	Proposed NCD “going in the right direction”; submitted comments; state-level wins (e.g., AR step therapy ban, 100% Medicaid rate)	Constructive
Tariffs/macro	–	Contracts largely locked for 2025; no material tariff impact expected this year	Neutral
Inorganic growth (M&A)	–	Announced acquisition of Lehan’s Medical (women’s health, respiratory) for ~$26M; not in guidance; expected Q3 close	Accretive platform
VA channel	–	“VA opportunity is dead” for now; no active pursuit	Deprioritized

Management Commentary

“We are ahead of where we anticipated in Q1 and have tightened our outlook upward for the year.” — CEO Casey Hoyt, highlighting broad-based strength and confidence in FY25 .
“Gross margin was 56.3%… The rapid growth of our sleep and staffing businesses… is the primary factor in the gross margin evolution of the company… adjusted EBITDA grew 26%… margin 21.6%.” — COO Todd Zehnder on mix and profitability .
“The strong balance sheet continues to facilitate the opportunity… to significantly improve and extend the life of our ventilator fleet… primarily funded by the existing buyback program from a large supplier.” — CEO on capital allocation .
“We expect to complete these ventilator buybacks in June… final payments in early third quarter.” — COO on program timing .
“We have seen no impact to date to our business from tariffs or a pullback from providers and payers.” — CEO on macro .

Q&A Highlights

Sales force ramp and execution: Intentional 2024 pause during restructuring is over; aggressive hiring now, faster ramp, and improved leadership/mentoring across territories .
Competitive landscape: Focus is less competitor-driven and more on penetrating an underserved population; differentiation via complex respiratory model .
Lehan’s strategic fit: Diversifies into maternal health (breast pumps) with resupply stream and private payers; leverage Viemed payer contracts nationally; respiratory/sleep playbook similar to prior HMP deal; Chicago market beachhead .
Margin profile of Lehan’s: Higher EBITDA margins driven by ~70% transactional (sales) mix with less SG&A intensity .
VA channel: “Dead” at present given administrative hurdles; no current pursuit .

Estimates Context

Q1 2025 Actual vs S&P Global Consensus: Revenue $59.13M vs $60.60M consensus* (miss), Diluted EPS $0.06 vs $0.06 consensus* (in line); 2 estimates for both revenue and EPS for Q1* (actuals); consensus values from S&P Global*.
Management framed Q1 as seasonally tough but “in line with our expectations,” and raised the lower end of FY25 guidance, suggesting potential upward estimate revisions for out-quarters given 5%–9% sequential growth assumptions .

Table – Actual vs Consensus (Q1 2025)

Metric	Actual	Consensus*	# of Estimates*
Revenue ($USD Millions)	$59.13	$60.60*	2*
Diluted EPS ($)	$0.06	$0.06*	2*

Values with asterisk (*) retrieved from S&P Global.

Key Takeaways for Investors

Solid start to FY25 with raised low-end guidance; execution tailwinds from 2024 sales restructuring continue to drive patient adds and diversification into sleep/staffing .
Near-term margin optics reflect mix (lower gross margin), but EBITDA margin and cash generation track the business model shift; adjusted EBITDA up 26% YoY and FY25 margin guided to 21%–23% .
Sequential acceleration likely: management guides Q2–Q4 sequential revenue growth of 5%–9%, setting up potential estimate upward revisions despite a modest Q1 revenue shortfall vs consensus* .
Strategic M&A optionality: Lehan’s adds women’s health (resupply and private payers) and a Chicago platform; not included in guidance, offering potential upside post-close (expected Q3) .
Regulatory backdrop turning more favorable for NIV access (CMS NCD reconsideration; state-level step-therapy wins), which could expand addressable market over time .
Capital allocation capacity intact (no net debt, $55M available), ventilator fleet program concluding, enabling higher free cash flow conversion and M&A flexibility .
Watch items: gross margin trajectory as mix shifts, execution on sales ramp, CMS NCD outcome/timing, and integration/expansion of Lehan’s post-close .

Appendix: Other Relevant Q1 2025 Press Releases

Acquisition: Definitive agreement to acquire Lehan’s Medical Equipment for ~$26M; 2024 revenue ~$25.7M, adjusted EBITDA ~$7.4M; expected to close in Q3, funded via cash and revolver .
Earnings PR and 8-K: Detailed financial statements and operational metrics; FY25 guidance raised at the low end .