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Vivos Therapeutics, Inc. (VVOS)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 showed a decisive inflection from the SCN acquisition: revenue rose 76% year over year and 78% sequentially to $6.78M, with gross margin at 58%; operating loss widened on higher SCN-related OpEx and D&A .
  • Results decisively exceeded Wall Street consensus: revenue beat by ~44% ($6.78M vs $4.71M*) and EPS beat modestly (−$0.49 vs −$0.51*). Management underscored strong SCN-driven service revenue and first-time “treatment center” revenue recognition .
  • Demand/supply dynamic is favorable: Vivos is booking SCN patients into late February 2026 as it expands capacity and credentials providers; ~two-thirds of SCN patients presented with options choose a Vivos appliance with >$5,000 average case value .
  • Near-term catalyst path: replicating the model via affiliations (MI Sleep in Michigan targeted to start seeing patients in early December) and ramping referral channels (large cardiology group in Las Vegas) while targeting 50–60% contribution margins at steady state .

What Went Well and What Went Wrong

  • What Went Well

    • “First full quarter” post-SCN delivered outsized growth: “revenue increased 76% to $6.8 million … and 78% sequentially,” including ~$2.2M OSA sleep testing and ~$1.3M new “treatment center” revenue at SCN .
    • Demand and patient mix: “we are currently booking SCN patients … into the latter part of February 2026,” and “just under two-thirds” of presented SCN patients choose Vivos appliances at “just over $5,000” per case on average .
    • Replicable growth model: affiliation with MI Sleep in Michigan (patients expected “beginning in early December”) and a scalable SO/SAMHSA team construct; management targets 50–60% contribution margins at steady state .

  • What Went Wrong

    • Margin pressure vs prior year: gross margin dipped to 58% (from 60% in Q3’24) on discounts, mix shift, and transition to the new model .
    • OpEx surge widened losses: Q3 OpEx rose 74% YoY to $8.7M (SCN staff, D&A), operating loss increased to $(4.7)M, and net loss to $(5.4)M; cash ended at $3.1M .
    • Guidance clarity softened: Q2 call suggested cash flow positive “sometime in the fourth quarter” 2025 ; Q3 call hedged timing, saying management “hesitate[s] to say exactly when” breakeven occurs .

Financial Results

Overall P&L (GAAP)

MetricQ3 2024Q1 2025Q2 2025Q3 2025
Revenue ($M)$3.86 $3.02 $3.82 $6.78
Gross Profit ($M)$2.33 $1.51 $2.11 $3.94
Gross Margin (%)60% 50% 55% 58%
Total Operating Expenses ($M)$4.98 $5.43 $6.98 $8.67
Operating Income (Loss) ($M)$(2.65) $(3.92) $(4.87) $(4.73)
Net Income (Loss) ($M)$(2.62) $(3.86) $(5.01) $(5.40)
Diluted EPS$(0.40) $(0.45) $(0.55) $(0.49)

Q3 2025 Actual vs Consensus (S&P Global)

MetricQ3 2025 ActualQ3 2025 ConsensusSurprise
Revenue ($M)$6.78 $4.71*+$2.07 (+44%)*
EPS$(0.49) $(0.51)*+$0.02*

Revenue Mix

Revenue Mix ($M)Q3 2024Q1 2025Q2 2025Q3 2025
Product Revenue$1.96 $1.81 $1.89 $2.20
Service Revenue$1.90 $1.20 $1.94 $4.59
  • Within Q3 services: SCN contributed ~$2.2M of OSA sleep testing and ~$1.3M of “treatment center” revenue (new line item) .

Balance Sheet and Operating KPIs

KPIQ1 2025Q2 2025Q3 2025
Cash & Cash Equivalents ($M)$2.34 $4.40 $3.09
Stockholders’ Equity ($M)$4.41 $4.58 $2.53
Debt – Current Portion ($M)— $0.16 $0.34
Debt – Long-Term ($M)— $7.76 $8.38

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Cash flow breakeven timing2025“Cash flow positive sometime in Q4” (Q2 call) No specific timing; “hesitate to say exactly when,” path tied to scaling affiliations/acquisitions Clarity reduced/hedged
SAMHSA/SO Center Contribution MarginSteady-state“Above 50%” (Q2 call) 50–60% Maintained/clarified upward bound
Provider credentialing rampScaling 2025–2026“2–6 months” credentialing “2–6 months”; expect sufficient licensed/credentialed providers in early 2026 Timeline updated
MI Sleep (Detroit) startInitial go-liveEstimated opening Oct 2025 Anticipating patients in early Dec 2025 Pushed ~1–2 months

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 & Q2 2025)Current Period (Q3 2025)Trend
SCN acquisition & integrationQ1: pending SCN to pivot model ; Q2: strong initial demand; 1.5 SO teams; 20 days → ~$0.5M testing revenue; multi-week backlog First full quarter impact: +$2.2M testing, +$1.3M treatment revenue; expanding facilities/teams; backlog into late Feb 2026 Strengthening traction
Affiliation modelQ1: shift to provider alliances ; Q2: MI Sleep agreement, Q4 go-live targeted MI Sleep patients anticipated early Dec; exploring similar arrangements nationwide Execution progressing
Reimbursement (CMS/PDAC)CMS PDAC approval for VidaSleep (Jul 1) expands coverage/pathways Supports payer adoption alongside mmRNA; reinforces value-based tiering Positive backdrop
Capacity & credentialingQ2: credentialing 2–6 months; facility expansion; team onboarding Still 2–6 months; expecting sufficient providers early 2026; demand > capacity Bottleneck persists but improving
Referral channelsQ2: building SCN funnels Large cardiology referrer increasing volumes; potential hundreds/month Expanding
Profitability/cash flowQ2: aim cash flow positive in Q4 Timing hedged; breakeven tied to deployment/scale Timing less certain
Pediatrics programQ2: plan to roll out pediatric OSA program Reiterated as 2026+ initiative In planning
Financing/cost of capitalQ2: expensive debt; plan to lower cost over time Balance sheet now with ~$8.7M LT debt; continue seeking lower-cost capital Monitoring

Management Commentary

  • CEO on inflection: “third quarter … a watershed quarter and an inflection point … ability to monetize … on a potentially large scale” .
  • SCN demand/capacity: “booking patients out into the latter part of February 2026 … expanding the facility … recruit, hire, train and deploy additional … team members” .
  • Patient choice and unit economics: “just under two-thirds … choose some form of Vivos oral appliance treatment, with an average dollar amount per case just over $5,000” .
  • Model scalability and margins: affiliation model “highly replicable and scalable,” with contribution margins of “50%–60%” at steady state .
  • CFO on mix/transition costs: Higher costs in Q3 tied to integrating SCN (appliance/pediatric/lifeline fees, SCN ops, staff financing, software/reporting), offsetting revenue gains .

Q&A Highlights

  • Revenue ramp modeling: Management expects a 3–6 month ramp to optimized revenue as providers are licensed/credentialed; the company is “leaving money on the table” until teams are fully staffed .
  • Unit economics: Steady-state SAMHSA/SO center “contribution margins of 50%–60%” are achievable; Q3 OpEx elevated due to hiring/infrastructure ahead of capacity .
  • Breakeven timing: Q2 management suggested Q4 2025 as a goal ; in Q3, management declined to specify timing, noting breakeven depends on incremental centers/affiliations .
  • Revenue recognition: Acquisitions allow recognition of product shipments plus diagnostic/treatment revenue; affiliations recognize appliance revenue as principal with fee/profit-sharing structures .
  • What to watch: Pace of new affiliations/acquisitions is a “bellwether” for top-line and contribution margin expansion .

Estimates Context

  • Q3 2025 revenue beat: $6.78M actual vs $4.71M consensus*, ~+44% surprise; EPS beat: −$0.49 vs −$0.51* .
  • Given the magnitude of the revenue beat and management’s commentary on capacity constraints easing into early 2026, Street models likely need to raise near-term revenue for services/treatment centers while reconsidering near-term OpEx/EBITDA trajectories given hiring/credentialing lags .

Note: *Values retrieved from S&P Global.

Key Takeaways for Investors

  • The SCN blueprint is working: strong Q3 revenue acceleration with new, recurring service/treatment revenue lines; replicability via MI Sleep and additional affiliations could compound growth .
  • Demand exceeds supply near term: backlog into late Feb 2026, growing referral channels, and credentialing gates suggest sustained volume visibility; watch provider onboarding pace .
  • Margin/FCF path is about deployment cadence: Contribution margins targeted at 50–60% per center, but breakeven timing depends on the speed of team deployment and payer credentialing .
  • Mix shift will drive volatility: Services/treatment mix can pressure gross margin near term (discounts/mix), but scale efficiencies and payer coverage (PDAC) should support margin recovery .
  • Balance sheet levered for growth: Debt introduced in 2025 to fund SCN; liquidity should be monitored as Vivos pursues additional centers; management aims to reduce cost of capital over time .
  • Stock reaction catalysts: announcements of new affiliations/acquisitions, MI Sleep go-live and early KPIs, payer credentialing wins, and evidence of rising contribution margins and reduced cash burn .
S&P Global disclaimer: Asterisked estimate figures are retrieved from S&P Global and do not carry document citations.

Sources

  • Q3 2025 8-K press release and financials: revenue/margins/OpEx/loss/cash/equity and MI Sleep timing .
  • Q3 2025 earnings call transcript: mix details (SCN sleep testing and treatment revenue), demand/credentialing/backlog, margins, referrals, breakeven commentary .
  • Q2 2025 8-K and call: sequential baselines, margin/OpEx context, initial SCN ramps, and breakeven goal .
  • Q1 2025 press release: prior-quarter baseline, pivot and CPT/coverage context .
  • CMS/PDAC press release for VidaSleep (Q3 timing): reimbursement/coverage expansion .