The wearable medical robotics maker slashed its 2025 revenue forecast and posted a wider-than-expected quarterly loss due to weaker lead quality, slower conversions, and rising costs.
Shares of Myomo plunged 42% in after-hours trading Monday after the maker of wearable medical robotics cut its 2025 revenue forecast and reported a bigger-than-expected loss in the second quarter (Q2).
Revenue for the three months ended June 30 rose 28% from a year earlier to $9.7 million, above the Koyfin analyst estimate of $9.15 million. However, the company’s losses widened.
Adjusted EBITDA loss was $4 million, missing analysts’ expectations of a $3.82 million loss. The company reported a net loss of $4.6 million, compared with expectations for a loss of $4.33 million in EBIT.
Earnings per share were a loss of $0.11 per share, in line with estimates, on a GAAP basis.
More than half of Q2 revenue came from Medicare Part B patients, helped by higher unit volumes and average selling prices.
However, key forward indicators weakened: orders and insurance authorizations slipped 3% to 207 units, backlog fell 18% to 230 units, and gross margin narrowed to 62.7% from 70.8% due to higher material and overhead costs.
CEO Paul R. Gudonis said performance was impacted by lower-quality leads resulting from changes to digital advertising, weaker conversion rates to pipeline additions and orders, and a cycle time issue where 40% to 50% of quarterly pipeline additions originate from leads generated more than a year prior.
He noted that patient response, clinical profiles, and a stronger focus on outcomes were leading to more candidates being ruled ineligible for the MyoPro device.
Much of the company’s 2025 advertising spend, he added, is expected to yield new patients in 2026 and beyond; however, recent actions and sustained ad spending are also expected to help improve operating metrics sooner.
Operating expenses surged 65% to $10.6 million, driven by higher payroll, engineering costs, and a 162% increase in advertising outlays.
Cash used in operations increased to $8.9 million from $1.9 million a year earlier, with non-recurring outflows, including $2.9 million in incentive payments and delayed insurance reimbursements, contributing to the shortfall.
To curb costs, Myomo reduced its workforce by 8% in July and is scaling back spending on outside services, targeting at least $2 million in annual cash savings. The company ended the quarter with $15.5 million in cash, cash equivalents, and short-term investments, bolstered by $4 million in new borrowings.
On Stocktwits, retail sentiment for Myomo was ‘extremely bullish’ early Tuesday amid a 4,700% surge in 24-hour message volume.
Myomo’s stock has declined by 72.7% so far in 2025.
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