Stereotaxis Reports 2024 First Quarter Financial Results

Rhea-AI Summary

Stereotaxis (NYSE: STXS), a leader in surgical robotics for minimally invasive endovascular intervention, reported financial results for Q1 2024, ending March 31. Revenue grew 5% YoY to $6.9M, with system revenue at $2.6M and recurring revenue at $4.3M. Gross margin was 58%. Operating expenses were $8.7M, including $2.6M in non-cash stock compensation. Adjusted operating expenses were $6.1M, down from $6.9M YoY. Operating loss and net loss were ($4.7M) and ($4.5M), respectively, improving from ($5.6M) and ($5.3M) YoY. Excluding non-cash expenses, adjusted operating and net loss were ($2.2M) and ($1.9M). Cash and equivalents stood at $18.2M with no debt. The company reported progress in regulatory submissions and technological advancements, including the MAGiC catheter and a new robot.

Positive

• Revenue increased by 5% YoY to $6.9 million.
• System revenue for Q1 2024 was $2.6 million, up from $1.8 million YoY.
• Operating expenses, excluding non-cash stock compensation, were reduced to $6.1 million from $6.9 million YoY.
• Operating loss improved to ($4.7 million) from ($5.6 million) YoY.
• Net loss reduced to ($4.5 million) from ($5.3 million) YoY.
• Strong cash position with $18.2 million in cash and no debt.
• Regulatory submissions for the MAGiC catheter completed in both Europe and the U.S.
• Two new Genesis system orders since the last call, increasing system backlog.
• Acquisition of APT expected to provide commercial synergies and strategic strength.
• Anticipation of multiple commercial launches later in 2024, including a new guidewire, product ecosystem in China, and a digital surgery solution.

Negative

• Recurring revenue decreased to $4.3 million from $4.7 million YoY.
• Gross margin for system revenue was relatively low at 27%.
• Operating expenses for Q1 2024 were high at $8.7 million.
• Operating loss and net loss, even when adjusted, remain negative at ($2.2 million) and ($1.9 million) respectively.
• Negative free cash flow for Q1 2024 was ($2.3 million).

Insights

Financial Analyst

The recent financial results for Stereotaxis highlight several key points that investors should consider. Firstly, the 5% revenue growth year-over-year is a positive indicator, although modest. This shows that the company is slowly expanding its market presence. System revenue saw a notable increase from $1.8 million to $2.6 million, indicating a rise in demand for their products. However, recurring revenue slightly declined, which might suggest challenges in maintaining a steady stream of income from existing customers.

The gross margin of 58% is relatively healthy, but the significant difference between recurring revenue gross margin (76%) and system gross margin (27%) highlights that their product sales are currently less profitable than their service and recurring income streams. Operating expenses have decreased, which is a good sign of financial prudence. However, the company still reported an operating loss of ($4.7) million, albeit lower than the previous year's ($5.6) million.

On the liquidity front, Stereotaxis has $18.2 million in cash and no debt, providing a decent cushion to fund ongoing operations and upcoming product launches. However, the negative free cash flow of ($2.3) million is a concern, indicating that the company is still consuming more cash than it generates.

In summary, while Stereotaxis is making progress, the financial figures indicate that the company is still in a phase of investment and growth rather than profitability. Investors should watch for how they manage their cash and control expenses in the coming quarters.

Medical Device Expert

Stereotaxis' updates on their technological and strategic initiatives provide significant insights into their future potential. The progress on the MAGiC catheter and the smaller, highly-accessible robot suggests that the company is on track with its innovation strategy. Regulatory submissions in both Europe and the U.S. for the MAGiC catheter, along with expectations for regulatory clearance for the new robot later this year, are promising. Regulatory approval is a critical milestone that can significantly impact market adoption and revenue growth.

Additionally, the commercial launch of a guidewire and a comprehensive product ecosystem in China could open new revenue streams and markets. The digital surgery solution enabling broad operating room connectivity is another interesting development, potentially positioning Stereotaxis as a leader in the digital transformation of surgical procedures.

However, the successful commercialization of these products will depend on the company’s ability to navigate regulatory pathways and market competition. Investors should closely monitor these developments, as regulatory delays or market challenges could impact the company's growth trajectory.

Market Research Analyst

Stereotaxis' strategic acquisition of APT is a noteworthy development that could provide substantial commercial synergies. Acquisitions in the med-tech industry often aim to bolster capabilities, expand product portfolios and enter new markets. The mention of 'valuable commercial synergies' suggests that APT's technologies or market reach could complement Stereotaxis' existing offerings, potentially accelerating growth.

Moreover, the company’s plan to launch a new product ecosystem in China aligns well with the rising demand for advanced medical technologies in the region. China's healthcare market is growing rapidly and capturing a share of this market could significantly enhance revenue. The digital surgery solution also aligns with current industry trends towards integrating digital and robotic technologies in healthcare, which can improve efficiency and outcomes.

However, the success of these strategic moves will depend on effective integration and execution. Potential risks include cultural and operational integration issues post-acquisition and the need for substantial investment to establish a strong presence in China.

Investors should remain cautious but optimistic, keeping an eye on how the company executes these strategic initiatives.

ST. LOUIS, May 13, 2024 (GLOBE NEWSWIRE) -- Stereotaxis (NYSE: STXS), a pioneer and global leader in surgical robotics for minimally invasive endovascular intervention, today reported financial results for the first quarter ended March 31, 2024.

“Stereotaxis is driving continued commercial, technological, and strategic progress,” said David Fischel, Chairman and CEO. “We are pleased to report revenue growth in the first quarter and an increase in system backlog with two Genesis systems orders since our last call. Our innovation strategy remains key to driving substantial commercial success, and we are making robust progress on multiple fronts in line with previous timelines. The acquisition of APT, as detailed in a separate press release, provides us valuable commercial synergies and strengthens us strategically.”

“Regulatory submissions for the MAGiC catheter were made in both Europe and the United States during the first quarter. We appreciate the responsiveness and collaborative nature of both regulatory bodies, having had substantive interaction with both since the submissions. Formal testing of our smaller highly-accessible robot is advancing well, with the majority of tests successfully completed. Regulatory submissions for the robot are expected during the second quarter, and European regulatory clearance is anticipated mid-year followed by FDA clearance in the second half of the year. We also expect commercial launches later this year of a guidewire that expands our technology into new indications, a comprehensive product ecosystem in China, and a digital surgery solution enabling broad operating room connectivity.”

“We are continuing to advance our technology and strategy in a financially prudent fashion. We retain a strong balance sheet which allows us to bring our transformative product ecosystem to market, fund its commercialization, and reach profitability. We have multiple shots on goal for breakout growth in 2025 and beyond.”

2024 First Quarter Financial Results
Revenue for the first quarter of 2024 totaled $6.9 million, growth of 5% from $6.5 million in the prior year first quarter. System revenue for the first quarter was $2.6 million and recurring revenue was $4.3 million, compared to $1.8 million and $4.7 million in the prior year first quarter, respectively.

Gross margin for the first quarter of 2024 was 58% of revenue. Recurring revenue gross margin was 76% and system gross margin was 27%. Operating expenses in the first quarter of $8.7 million include $2.6 million in non-cash stock compensation expense. Excluding non-cash stock compensation expense, adjusted operating expenses in the quarter were $6.1 million, compared to $6.9 million for adjusted operating expenses in the prior year first quarter.

Operating loss and net loss for the first quarter of 2024 were ($4.7) million and ($4.5) million, respectively, compared to ($5.6) million and ($5.3) million in the previous year. Adjusted operating loss and adjusted net loss for the quarter, excluding non-cash stock compensation expense, were ($2.2) million and ($1.9) million, respectively, compared with ($3.0) million and ($2.7) million in the previous year. Negative free cash flow for the first quarter was ($2.3) million.

Cash Balance and Liquidity
At March 31, 2024, Stereotaxis had cash and cash equivalents, including restricted cash, of $18.2 million and no debt.

Forward Looking Expectations
Stereotaxis maintains its expectation of double-digit revenue growth for the full year 2024 driven by revenue recognition of system backlog and new system orders, and not incorporating contribution of revenue from APT.

First quarter cash utilization is typically higher than subsequent quarters. Stereotaxis anticipates a lower rate of cash utilization, even incorporating the expenses associated with acquiring, integrating and operating APT. Stereotaxis’ balance sheet allows it to advance its transformative product ecosystem to market, fund its commercialization, and reach profitability without the need for additional financing.

Conference Call and Webcast
Stereotaxis will host a conference call and webcast today, May 13, 2024, at 4:30 p.m. Eastern Time. To access the conference call, dial 1-800-715-9871 (US and Canada) or 1-646-307-1963 (International) and give the participant pass code 7212885. To access the live and replay webcast, please visit the investor relations section of the Stereotaxis website at www.Stereotaxis.com.

About Stereotaxis
Stereotaxis (NYSE: STXS) is a pioneer and global leader in innovative surgical robotics for minimally invasive endovascular intervention. Its mission is the discovery, development and delivery of robotic systems, instruments, and information solutions for the interventional laboratory. These innovations help physicians provide unsurpassed patient care with robotic precision and safety, expand access to minimally invasive therapy, and enhance the productivity, connectivity, and intelligence in the operating room. Stereotaxis technology has been used to treat over 100,000 patients across the United States, Europe, Asia, and elsewhere. For more information, please visit www.Stereotaxis.com.

This press release includes statements that may constitute "forward-looking" statements, usually containing the words "believe”, "estimate”, "project”, "expect" or similar expressions. Forward-looking statements inherently involve risks and uncertainties that could cause actual results to differ materially. Factors that would cause or contribute to such differences include, but are not limited to, the Company's ability to manage expenses at sustainable levels, acceptance of the Company's products in the marketplace, the effect of global economic conditions on the ability and willingness of customers to purchase its technology, competitive factors, changes resulting from healthcare policy, dependence upon third-party vendors, timing of regulatory approvals, the impact of pandemics or other disasters, risks related to the completion, integration and ongoing operations relating to the proposed acquisition of APT set forth in our concurrent press release announcing the APT transaction, and other risks discussed in the Company's periodic and other filings with the Securities and Exchange Commission. By making these forward-looking statements, the Company undertakes no obligation to update these statements for revisions or changes after the date of this release. There can be no assurance that the Company will recognize revenue related to its purchase orders and other commitments because some of these purchase orders and other commitments are subject to contingencies that are outside of the Company's control and may be revised, modified, delayed, or canceled.

Company Contacts:
David L. Fischel
Chairman and Chief Executive Officer

Kimberly R. Peery
Chief Financial Officer

314-678-6100
Investors@Stereotaxis.com

STEREOTAXIS, INC.
STATEMENTS OF OPERATIONS
(in thousands, except share and per share amounts)	Three Months Ended March 31,
		2024				2023
Revenue:
Systems	$	2,612			$	1,821
Disposables, service and accessories		4,268				4,727
Total revenue		6,880				6,548
Cost of revenue:
Systems		1,900				1,697
Disposables, service and accessories		1,014				975
Total cost of revenue		2,914				2,672
Gross margin		3,966				3,876
Operating expenses:
Research and development		2,243				2,746
Sales and marketing		3,003				3,148
General and administrative		3,466				3,601
Total operating expenses		8,712				9,495
Operating loss		(4,746	)			(5,619	)
Interest income, net		239				272
Net loss	$	(4,507	)		$	(5,347	)
Cumulative dividend on convertible preferred stock		(331	)			(331	)
Net loss attributable to common stockholders	$	(4,838	)		$	(5,678	)
Net loss per share attributed to common stockholders:
Basic	$	(0.06	)		$	(0.07	)
Diluted	$	(0.06	)		$	(0.07	)
Weighted average number of common shares and equivalents:
Basic		83,476,498				76,500,965
Diluted		83,476,498				76,500,965

STEREOTAXIS, INC.
BALANCE SHEETS
(in thousands, except share amounts)	March 31, 2024				December 31, 2023
Assets
Current assets:
Cash and cash equivalents	$	17,633			$	19,818
Restricted cash - current		525				525
Accounts receivable, net of allowance of $609 and $672 at 2024 and 2023, respectively		3,953				3,822
Inventories, net		8,252				8,426
Prepaid expenses and other current assets		845				676
Total current assets		31,208				33,267
Property and equipment, net		3,164				3,304
Restricted cash		88				219
Operating lease right-of-use assets		4,876				4,982
Prepaid and other non-current assets		116				137
Total assets	$	39,452			$	41,909
Liabilities and stockholders' equity
Current liabilities:
Accounts payable	$	3,307			$	3,190
Accrued liabilities		3,164				2,972
Deferred revenue		5,938				6,657
Current portion of operating lease liabilities		443				428
Total current liabilities		12,852				13,247
Long-term deferred revenue		1,581				1,637
Operating lease liabilities		4,945				5,062
Other liabilities		43				43
Total liabilities		19,421				19,989
Series A - Convertible preferred stock:
Convertible preferred stock, Series A, par value $0.001; 21,908 and 22,358 shares outstanding at 2024 and 2023, respectively		5,464				5,577
Stockholders' equity:
Common stock, par value $0.001; 300,000,000 shares authorized, 82,132,777 and 80,949,697 shares issued at 2024 and 2023, respectively		82				81
Additional paid-in capital		556,878				554,148
Treasury stock, 4,015 shares at 2024 and 2023		(206	)			(206	)
Accumulated deficit		(542,187	)			(537,680	)
Total stockholders' equity		14,567				16,343
Total liabilities and stockholders' equity	$	39,452			$	41,909

FAQ

What were Stereotaxis' Q1 2024 revenues?

Stereotaxis reported Q1 2024 revenues of $6.9 million, a 5% increase from the prior year's $6.5 million.

What is the current cash position of Stereotaxis as of March 31, 2024?

As of March 31, 2024, Stereotaxis had $18.2 million in cash and cash equivalents with no debt.

How did Stereotaxis' system revenue perform in Q1 2024?

System revenue for Q1 2024 was $2.6 million, up from $1.8 million in Q1 2023.

What were Stereotaxis' operating losses in Q1 2024?

Stereotaxis reported an operating loss of ($4.7 million) in Q1 2024, compared to ($5.6 million) in Q1 2023.

What are the anticipated regulatory clearances for Stereotaxis' new robot?

Stereotaxis expects European regulatory clearance for its new robot mid-year and FDA clearance in the second half of 2024.

How much was Stereotaxis' net loss in Q1 2024?

Stereotaxis reported a net loss of ($4.5 million) in Q1 2024, compared to ($5.3 million) in Q1 2023.

What recent acquisitions has Stereotaxis made?

Stereotaxis recently acquired APT, aiming for valuable commercial synergies and strategic strength.

What is the gross margin of Stereotaxis for Q1 2024?

Stereotaxis reported a gross margin of 58% for Q1 2024.

What are Stereotaxis' plans for new product launches in 2024?

Stereotaxis plans to launch a new guidewire, a comprehensive product ecosystem in China, and a digital surgery solution later in 2024.

What was Stereotaxis' negative free cash flow in Q1 2024?

Stereotaxis reported a negative free cash flow of ($2.3 million) for Q1 2024.