Neuronetics Reports Record Fourth Quarter and Record Full Year 2022 Financial and Operating Results
Neuronetics (NASDAQ: STIM) reported its Q4 and full-year 2022 results, highlighting a 21% revenue increase in Q4, totaling $18.2 million, and an 18% annual increase to $65.2 million. U.S. treatment session revenue in Q4 reached a record $12.5 million. The company signed an expanded partnership with Greenbrook TMS, enhancing access to NeuroStar Advanced Therapy. Despite growth, the net loss for Q4 2022 was $(8.3) million and $(37.2) million for the full year, with increasing operating expenses driven by sales force expansion. Cash reserves decreased to $70.3 million by year-end.
- Q4 2022 revenue increased by 21% to $18.2 million.
- Achieved record U.S. treatment session revenue of $12.5 million in Q4.
- NeuroStar System revenue rose by 64% year-over-year in Q4.
- Expanded commercial partnership with Greenbrook TMS through 2028.
- Positive TMS coverage policy enhancing patient access to NeuroStar therapy.
- Net loss for Q4 2022 was $(8.3) million, worse than $(7.6) million in Q4 2021.
- Full year net loss increased to $(37.2) million from $(31.2) million in 2021.
- Operating expenses rose by 17.1% in Q4 and by 19.1% for the full year 2022.
- Gross margin decreased to 75.9% in Q4 from 76.4% in Q4 2021 and to 76.3% for the full year, down from 78.9%.
MALVERN, Pa., March 07, 2023 (GLOBE NEWSWIRE) -- Neuronetics, Inc. (NASDAQ: STIM), a commercial stage medical technology company with a strategic vision of transforming the lives of patients whenever and wherever they need help with the best neurohealth therapies in the world, today announced its financial and operating results for the fourth quarter and full year of 2022.
Fourth Quarter 2022 Highlights
- Fourth quarter 2022 revenue of
$18.2 million , representing a21% increase as compared to the fourth quarter 2021 - Achieved record U.S. treatment session revenue of
$12.5 million in the fourth quarter 2022 - Increased NeuroStar System revenue
64% over the fourth quarter of 2021
Full Year 2022 Highlights
- Full year 2022 revenue of
$65.2 million , representing an18% increase as compared to full year 2021 - Full year 2022 U.S. treatment session revenue of
$45.1 million - Full year 2022 U.S. NeuroStar Advanced Therapy revenue of
$16.6 million
Recent Operational Highlights
- Signed an exclusive and expanded commercial partnership with Greenbrook TMS which runs through 2028
- Positive TMS coverage policy which expands patient access to NeuroStar Advanced Therapy for Mental Health, allowing Nurse practitioners (NPs) to order and provide TMS treatment to their patients with MDD
- United Health Care and Optum indicated their benefits manager have expanded access to NeuroStar Advanced Therapy for Mental Health by reducing the number of prior failed medications from four to two. UHC policies cover 23.8 million lives
- Announced a peer-reviewed publication that shows NeuroStar TMS as an effective non-drug treatment for depression with comorbid anxiety
Recent Commercial Highlights
- Achieved milestones of over 145,000 global patients treated with more than 5.3 million of our Treatment Sessions, another Company record
- During the fourth quarter, the Company shipped its 2,000th NeuroStar system
- Over 75 accounts attended NeuroStar University in 2022
“Our strong performance in the fourth quarter reflects the positive impacts of our ongoing strategic initiatives such as the revamped sales force, innovative marketing programs, and continued physician and patient education. Performance was highlighted by record US Treatment Sessions revenue, while also achieving
Fourth Quarter 2022 Financial and Operating Results for the Three Months Ended December 31, 2022
| Revenues by Geography | ||||||||||||
| Three Months Ended December 31, | ||||||||||||
| 2022 | 2021 | |||||||||||
| Amount | Amount | % Change | ||||||||||
| (in thousands, except percentages) | ||||||||||||
| United States | $ | 17,513 | $ | 14,556 | 20 | % | ||||||
| International | 685 | 466 | 47 | % | ||||||||
| Total revenues | $ | 18,198 | $ | 15,022 | 21 | % | ||||||
Total revenue for the three months ended December 31, 2022, was
| U.S. Revenues by Product Category | ||||||||||||
| Three Months Ended December 31, | ||||||||||||
| 2022 | 2021 | |||||||||||
| Amount | Amount | % Change | ||||||||||
| (in thousands, except percentages) | ||||||||||||
| NeuroStar Advanced Therapy System | $ | 4,616 | $ | 2,815 | 64 | % | ||||||
| Treatment sessions | 12,450 | $ | 11,245 | 11 | % | |||||||
| Other | 447 | $ | 496 | (10 | ) | % | ||||||
| Total U.S. revenues | $ | 17,513 | $ | 14,556 | 20 | % | ||||||
| U.S. NeuroStar Advanced Therapy System | ||||||||||||
| Revenues by Type | ||||||||||||
| Three Months Ended December 31, | ||||||||||||
| 2022 | 2021 | |||||||||||
| Amount | Amount | % Change | ||||||||||
| (in thousands, except percentages) | ||||||||||||
| NeuroStar Capital | $ | 4,371 | $ | 2,513 | 74 | % | ||||||
| Operating lease | 43 | 85 | (49 | ) | % | |||||||
| Other | 202 | 217 | (7 | ) | % | |||||||
| Total United States NeuroStar Advanced Therapy System revenues | $ | 4,616 | $ | 2,815 | 64 | % | ||||||
U.S. NeuroStar Advanced Therapy System revenue for the three months ended December 31, 2022, was
U.S. Treatment Session revenue for the three months ended December 31, 2022, was
In the fourth quarter of 2022, U.S. treatment session revenue per active site was approximately
Gross margin for the fourth quarter of 2022 was
Operating expenses during the fourth quarter of 2022 were
Net loss for the fourth quarter of 2022 was
EBITDA for the fourth quarter of 2022 was
Full Year Financial and Operating Results
| Revenues by Geography | ||||||||||||
| Year Ended December 31, | ||||||||||||
| 2022 | 2021 | |||||||||||
| Amount | Amount | % Change | ||||||||||
| (in thousands, except percentages) | ||||||||||||
| United States | $ | 63,406 | $ | 53,447 | 19 | % | ||||||
| International | 1,800 | 1,865 | (3 | ) | % | |||||||
| Total revenues | $ | 65,206 | $ | 55,312 | 18 | % | ||||||
Total revenues increased by
| U.S. Revenues by Product Category | ||||||||||||
| Year Ended December 31, | ||||||||||||
| 2022 | 2021 | |||||||||||
| Amount | Amount | % Change | ||||||||||
| (in thousands, except percentages) | ||||||||||||
| NeuroStar Advanced Therapy System | $ | 16,575 | $ | 9,760 | 70 | % | ||||||
| Treatment sessions | 45,077 | 41,933 | 7 | % | ||||||||
| Other | 1,754 | 1,754 | — | % | ||||||||
| Total U.S. revenues | $ | 63,406 | $ | 53,447 | 19 | % | ||||||
| U.S. NeuroStar Advanced Therapy System | ||||||||||||
| Revenues by Type | ||||||||||||
| Year Ended December 31, | ||||||||||||
| 2022 | 2021 | |||||||||||
| Amount | Amount | % Change | ||||||||||
| (in thousands, except percentages) | ||||||||||||
| NeuroStar Capital | $ | 15,792 | $ | 8,820 | 79 | % | ||||||
| Operating lease | 222 | $ | 279 | (20 | ) | % | ||||||
| Other | 561 | $ | 661 | (15 | ) | % | ||||||
| Total United States NeuroStar Advanced Therapy System revenues | $ | 16,575 | $ | 9,760 | 70 | % | ||||||
U.S. NeuroStar Advanced Therapy System revenue increased by
U.S. treatment session revenues increased by
Gross margin for the full year 2022 was
Operating expenses during the full year 2022 were
Net loss for the full year 2022 was
EBITDA for the full year 2022 was
Cash and cash equivalents were
TMS Coverage Policies Updates
In February 2023, the National Government Services, Inc. (NGS), announced a healthcare policy update that increases access for patients to its NeuroStar® Advanced Therapy for Mental Health transcranial magnetic stimulation (TMS). The NGS policy, effective April 1, 2023, will allow non-physician practitioners (NPPs) who are within their scope of practice to order and provide TMS treatment to their patients with major depressive disorder (MDD). NGS is the Medicare Administrative Contractor for 6.3 million covered lives in MN, WI, IL, NY, NH, VT, ME, MA, RI, and CT. An additional update in the revised NGS policy is a lower medication requirement – reduced from four failed medications to two prior to TMS treatment.
Greenbrook TMS Six Year Exclusive Partnership
In January 2023, the Company announced an expanded commercial partnership through year end 2028 with Greenbrook TMS Inc. a leading provider of transcranial magnetic stimulation therapy. Under the partnership agreement, Neuronetics will be the exclusive supplier of TMS equipment to Greenbrook. Over time, Neuronetics’ NeuroStar devices will replace competitive TMS devices at Greenbrook locations. The Companies will work jointly to grow through co-branding and co-marketing programs, enhanced patient and clinician awareness, improved patient access to care, and collaboration on product development and publications. The agreement also has minimum purchase commitments, and all treatment session purchases will convert to a “per-click” consumable model.
Data Published on Efficacy of Treating Anxious Depression with NeuroStar TMS
In January 2023, the Company announced a peer-reviewed publication that shows NeuroStar TMS as an effective non-drug treatment for depression with comorbid anxiety. The Journal of Clinical Psychiatry, presenting real-world evidence of the efficacy of NeuroStar Advanced Therapy for adult patients who suffer concurrently from anxiety symptoms and major depressive disorder (MDD), also known as anxious depression. Using data from TrakStar®, the world’s largest depression outcomes registry of more than 15,000 patients, the publication authors analyzed a sample of over 1,800 patients. These 1,800 patients were treated with NeuroStar TMS in commercial clinics and represented a diversity of patients with MDD and moderate-to-severe anxiety symptoms. Patients with anxious depression exhibited clinically meaningful anxiety symptom improvement and antidepressant effects.
Business Outlook
For the first quarter of 2023, the Company expects total worldwide revenue between
For the full year 2023, the Company now expects total worldwide revenue to be between
For the full year 2023, the Company expects total operating expenses to be between
Webcast and Conference Call Information
Neuronetics’ management team will host a conference call on March 7, 2023, beginning at 8:30 a.m. Eastern Time.
The conference call will be broadcast live in listen-only mode via webcast at https://edge.media-server.com/mmc/p/cfhuftjj. To listen to the conference call on your telephone, participants may register for the call here. While it is not required, it is recommended you join 10 minutes prior to the event start. To access the live audio webcast or subsequent archived recording, visit the Investor Relations section of Neuronetics’ website at ir.neuronetics.com.
About Neuronetics
Neuronetics, Inc. believes that mental health is as important as physical health. As a global leader in neuroscience and the largest TMS company in the industry, Neuronetics is redefining patient and physician expectations by designing and developing products that improve the quality of life for people suffering from psychiatric disorders. An FDA-cleared, non-drug, noninvasive treatment for people with depression, Neuronetics’ NeuroStar® Advanced Therapy system is today’s leading transcranial magnetic stimulation (TMS) treatment for major depressive disorder with over 4.8 million treatments delivered. NeuroStar is widely researched and backed by the largest clinical data set of any TMS system for depression, including the world’s largest depression Outcomes Registry. Our NeuroStar® Advanced Therapy system is also FDA-cleared to treat people suffering from obsessive-compulsive disorder, as well as for the treatment of comorbid anxiety symptoms (“anxious depression”) for adults with MDD suffering from anxiety symptoms. Neuronetics is committed to transforming lives by offering an exceptional treatment option that produces extraordinary results. For safety information and indications for use, visit NeuroStar.com.
“Safe harbor” statement under the Private Securities Litigation Reform Act of 1995:
Statements in the press release regarding Neuronetics, Inc. (the “Company”) that are not historical facts constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may be identified by terms such as “outlook,” “potential,” “believe,” “expect,” “plan,” “anticipate,” “predict,” “may,” “will,” “could,” “would” and “should” as well as the negative of these terms and similar expressions. These statements include those relating to the Company’s business outlook and current expectations for upcoming quarter and fiscal year 2023, including with respect to revenue, expenses, growth, and any statements of assumptions underlying any of the foregoing items. These statements are subject to significant risks and uncertainties and actual results could differ materially from those projected. The Company cautions investors not to place undue reliance on the forward-looking statements contained in this release. These risks and uncertainties include, without limitation, risks and uncertainties related to: the impact of public health crises on the Company’s operations, manufacturing and supply chain interruptions or delays; the Company’s ability to execute its business strategy; the Company’s ability to achieve or sustain profitable operations due to its history of losses; the Company’s reliance on the sale and usage of its NeuroStar Advanced Therapy for Mental Health System to generate revenues; the scale and efficacy of the Company’s salesforce; the Company’s ability to retain talent; availability of coverage and reimbursement from third-party payors for treatments using the Company’s products; physician and patient demand for treatments using the Company’s products; developments in competing technologies and therapies for the indications that the Company’s products treat; product defects; the Company’s ability to obtain and maintain intellectual property protection for its technology; developments in clinical trials or regulatory review of NeuroStar Advanced Therapy for Mental Health System for additional indications; and developments in regulation in the United States and other applicable jurisdictions. For a discussion of these and other related risks, please refer to the Company’s recent SEC filings which are available on the SEC’s website at www.sec.gov. These forward-looking statements are based on the Company’s expectations and assumptions as of the date of this press release. Except as required by law, the Company undertakes no duty or obligation to update any forward-looking statements contained in this press release as a result of new information, future events, or changes in the Company’s expectations.
Investor Contact:
Mike Vallie or Mark Klausner
Westwicke Partners
443-213-0499
ir@neuronetics.com
Media Contact:
EvolveMKD
646-517-4220
NeuroStar@evolvemkd.com
NEURONETICS, INC.
Statements of Operations
(In thousands, except per share data)
| Three Months ended | Year ended | |||||||||||||||
| December 31, | December 31, | |||||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||
| Revenues | $ | 18,198 | $ | 15,022 | $ | 65,206 | $ | 55,312 | ||||||||
| Cost of revenues | 4,389 | 3,538 | 15,483 | 11,653 | ||||||||||||
| Gross Profit | 13,809 | 11,484 | 49,723 | 43,659 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Sales and marketing | 12,005 | 10,316 | 49,982 | 37,746 | ||||||||||||
| General and administrative | 6,391 | 6,333 | 25,516 | 25,554 | ||||||||||||
| Research and development | 3,139 | 1,743 | 9,336 | 7,923 | ||||||||||||
| Total operating expenses | 21,535 | 18,392 | 84,834 | 71,223 | ||||||||||||
| Loss from Operations | (7,726 | ) | (6,908 | ) | (35,111 | ) | (27,564 | ) | ||||||||
| Other (income) expense: | ||||||||||||||||
| Interest expense | 1,212 | 1,064 | 4,251 | 4,019 | ||||||||||||
| Other income, net | (649 | ) | (337 | ) | (2,203 | ) | (390 | ) | ||||||||
| Net Loss | $ | (8,289 | ) | $ | (7,635 | ) | $ | (37,159 | ) | $ | (31,193 | ) | ||||
| Net loss per share of common stock outstanding, basic and diluted | $ | (0.30 | ) | $ | (0.29 | ) | $ | (1.38 | ) | $ | (1.22 | ) | ||||
| Weighted-average common shares outstanding, basic and diluted | 27,207 | 26,371 | 26,900 | 25,479 | ||||||||||||
NEURONETICS, INC.
Balance Sheets
(In thousands, except per share data)
| December 31, | December 31, | |||||||
| 2022 | 2021 | |||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 70,340 | $ | 94,141 | ||||
| Accounts receivable, net | 13,591 | 7,706 | ||||||
| Inventory | 8,899 | 6,563 | ||||||
| Current portion of net investments in sales-type leases | 1,538 | 2,198 | ||||||
| Current portion of prepaid commission expense | 1,997 | 1,559 | ||||||
| Current portion of note receivables | 230 | 74 | ||||||
| Prepaid expenses and other current assets | 2,174 | 3,090 | ||||||
| Total current assets | 98,769 | 115,331 | ||||||
| Property and equipment, net | 1,991 | 1,220 | ||||||
| Operating lease right-of-use assets | 3,327 | 3,884 | ||||||
| Net investments in sales-type leases | 1,222 | 1,697 | ||||||
| Prepaid commission expense | 7,568 | 6,763 | ||||||
| Long-term note receivable | 362 | 10,110 | ||||||
| Other assets | 3,645 | 2,218 | ||||||
| Total Assets | $ | 116,884 | $ | 141,223 | ||||
| Liabilities and Stockholders’ Equity | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 2,433 | $ | 4,299 | ||||
| Accrued expenses | 14,837 | 8,233 | ||||||
| Deferred revenue | 1,980 | 2,501 | ||||||
| Current portion of operating lease liabilities | 824 | 670 | ||||||
| Current portion of long-term debt, net | 13,125 | — | ||||||
| Total current liabilities | 33,199 | 15,703 | ||||||
| Long-term debt, net | 22,829 | 35,335 | ||||||
| Deferred revenue | 829 | 1,471 | ||||||
| Operating lease liabilities | 2,967 | 3,539 | ||||||
| Total Liabilities | 59,824 | 56,048 | ||||||
| Commitments and contingencies (Note 17) | — | — | ||||||
| Stockholders’ Equity: | ||||||||
| Preferred stock, | — | — | ||||||
| Common stock, | 273 | 264 | ||||||
| Additional paid-in capital | 402,679 | 393,644 | ||||||
| Accumulated deficit | (345,892 | ) | (308,733 | ) | ||||
| Total Stockholders’ Equity | 57,060 | 85,175 | ||||||
| Total Liabilities and Stockholders’ Equity | $ | 116,884 | $ | 141,223 | ||||
NEURONETICS, INC.
Statements of Cash Flows
(In thousands)
| Year ended December 31, | ||||||||
| 2022 | 2021 | |||||||
| Cash Flows from Operating Activities: | ||||||||
| Net loss | $ | (37,159 | ) | $ | (31,193 | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Depreciation and amortization | 1,648 | 1,060 | ||||||
| Share-based compensation | 8,746 | 7,869 | ||||||
| Non-cash interest expense | 709 | 715 | ||||||
| Cost of rental units purchased by customers | 92 | 203 | ||||||
| Changes in certain assets and liabilities: | ||||||||
| Accounts receivable, net | (6,317 | ) | (3,054 | ) | ||||
| Inventory | (2,587 | ) | (3,444 | ) | ||||
| Net investment in sales-type leases | 1,114 | 324 | ||||||
| Prepaid commission expense | (1,243 | ) | (1,926 | ) | ||||
| Prepaid expenses and other assets | 786 | 62 | ||||||
| Accounts payable | (1,968 | ) | 276 | |||||
| Accrued expenses | 6,604 | 910 | ||||||
| Deferred revenue | (1,164 | ) | 215 | |||||
| Net Cash Used in Operating Activities | (30,739 | ) | (27,983 | ) | ||||
| Cash Flows from Investing Activities: | ||||||||
| Purchases of property and equipment and capitalized software | (3,269 | ) | (2,353 | ) | ||||
| Repayment (Issuance) of promissory note | 10,000 | (7,486 | ) | |||||
| Net Cash provided by (Used in) Investing Activities | 6,731 | (9,839 | ) | |||||
| Cash Flows from Financing Activities: | ||||||||
| Payments of debt issuance costs | (91 | ) | — | |||||
| Proceeds from exercises of stock options | 298 | 2,435 | ||||||
| Proceeds from common stock offering | — | 80,972 | ||||||
| Payments of common stock offering issuance costs | — | (401 | ) | |||||
| Net Cash (Used) Provided by Financing Activities | 207 | 83,006 | ||||||
| Net (Decrease) Increase in Cash and Cash Equivalents | (23,801 | ) | 45,184 | |||||
| Cash and Cash Equivalents, Beginning of Period | 94,141 | 48,957 | ||||||
| Cash and Cash Equivalents, End of Period | $ | 70,340 | $ | 94,141 | ||||
Non-GAAP Financial Measures (Unaudited)
EBITDA is not a measure of financial performance under generally accepted accounting principles in the United States, or GAAP, and should not be construed as a substitute for, or superior to, GAAP net loss. However, management uses both the GAAP and non-GAAP financial measures internally to evaluate and manage the Company’s operations and to better understand its business. Further, management believes the addition of the non-GAAP financial measure provides meaningful supplementary information to, and facilitates analysis by, investors in evaluating the Company’s financial performance, results of operations and trends. The Company’s calculation of EBITDA may not be comparable to similarly designated measures reported by other companies, because companies and investors may differ as to what type of events warrant adjustment.
The following table reconciles reported net loss to EBITDA:
| Three Months ended | Year ended | |||||||||||||||
| December 31, | December 31, | |||||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||
| (in thousands) | (in thousands) | |||||||||||||||
| Net loss | $ | (8,289 | ) | $ | (7,635 | ) | $ | (37,159 | ) | $ | (31,193 | ) | ||||
| Interest expense | 1,212 | 1,064 | 4,251 | 4,019 | ||||||||||||
| Income taxes | — | — | — | — | ||||||||||||
| Depreciation and amortization | 604 | 292 | 1,648 | 1,060 | ||||||||||||
| EBITDA | $ | (6,473 | ) | $ | (6,279 | ) | $ | (31,260 | ) | $ | (26,114 | ) | ||||
FAQ
What were Neuronetics' Q4 2022 revenue figures?
How did NeuroStar System sales perform in Q4 2022?
What was Neuronetics' net loss in Q4 2022?
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What is Neuronetics' revenue guidance for 2023?
