Apyx Medical ((APYX)) has held its Q1 earnings call. Read on for the main highlights of the call.
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Apyx Medical’s latest earnings call struck an upbeat tone, with management emphasizing strong momentum from its AYON body contouring system and robust demand in Surgical Aesthetics. Investors heard about double-digit revenue growth, expanding margins, shrinking operating losses, and a higher full-year outlook, even as executives acknowledged ongoing GAAP losses and some external and execution risks.
Total Revenue Growth
Apyx reported first-quarter 2026 revenue of $12.5 million, up 32% from $9.4 million a year earlier, underscoring accelerating top-line momentum. Management tied the increase to growing traction across its aesthetics portfolio, particularly as AYON moves deeper into commercial rollout.
Surgical Aesthetics Segment Surge Driven by AYON
Revenue from the Surgical Aesthetics segment jumped 36% year-over-year to $10.7 million, compared with $7.9 million in the prior-year quarter. The company credited the second full quarter of AYON sales in the U.S., higher single-use handpiece volume, and stronger international Renuvion generator demand.
Strong International Momentum
International sales surged 63% to $4.4 million, far outpacing the 20% growth in domestic revenue, which reached $8.1 million. Management highlighted early demand in South Korea following regulatory approval, noting that uptake there exceeded their initial expectations.
Improved Profitability Metrics
Gross profit climbed 40% year-over-year to $7.9 million, as gross margin expanded to 63.5% from 60.1%. Executives pointed to a richer mix from Surgical Aesthetics and AYON-related products as the main driver of this margin expansion.
Operating Performance and Cash Flow Improvements
Loss from operations narrowed sharply to $0.9 million from $3.1 million a year ago, while net loss improved to $2.1 million, or $0.05 per share, from $4.2 million, or $0.10. Adjusted EBITDA loss improved to $0.3 million, and operating cash burn ticked down to $0.6 million, with cash and equivalents standing at $31.1 million.
Upwardly Revised 2026 Guidance
The company raised its full-year 2026 revenue outlook to a range of $59 million to $60 million, up from prior guidance of $57.5 million to $58.5 million. Surgical Aesthetics is now expected to contribute $54 million to $55 million, while OEM revenue is forecast at roughly $5 million, with management also targeting gross margins in the low 60% range and operating expenses capped at $45 million.
Product Roadmap and Regulatory Milestone
Apyx outlined a key upcoming milestone for AYON, expecting regulatory clearance to add power-assisted liposuction functionality in the near term. Management believes this expanded indication will support multiple advanced fat removal modalities and could significantly broaden AYON’s addressable market and adoption curve.
Disciplined Commercial Execution and Lean Cost Structure
Executives emphasized that a lean operating model introduced about a year ago has reduced expenses and cash burn, allowing targeted reinvestment in growth initiatives. The AYON launch has focused on training and integrating the system into surgical workflows, which management views as critical to sustained customer success and utilization.
Domestic Generator Sales Decline / Reclassification Impact
The company noted lower reported domestic generator sales, attributing part of the decline to reclassifying new combined systems as AYON rather than standalone generators. This shift reflects a changing product mix and can obscure trends in legacy generator demand, but underscores the strategic pivot toward integrated AYON platforms.
OEM Segment Trending Lower Long-Term
OEM revenue reached $1.8 million for the quarter, up 14% year-over-year, but management reiterated that this business is expected to decline over time. As the company shifts strategic focus and resources toward Surgical Aesthetics, investors should anticipate a gradual wind-down in OEM contribution despite occasional quarterly fluctuations.
Tariff and Geographic Cost Pressure
While margins improved, executives flagged headwinds from geographic mix and tariffs that began impacting results in the second half of 2025. These trade-related costs are expected to persist through the year and could influence profitability depending on how sourcing patterns and policy decisions evolve.
Company Remains GAAP Loss-Making
Despite better margins and lower operating losses, Apyx remains unprofitable on a GAAP basis, with a $2.1 million net loss in the quarter and operating expenses of $8.8 million. Management stressed that continued discipline on spending will be essential to bridging the gap to sustainable profitability.
Adoption Still Early; Some Surgeons Waiting on Power-Lipo Label
Management repeatedly emphasized that AYON adoption is still in the early innings, with considerable runway ahead. They noted that some surgeons who exclusively use power-assisted liposuction are delaying purchases until AYON receives the expanded indication, meaning short-term demand is partly tied to regulatory timing.
Execution Risks Outside U.S. and Timing Uncertainty
International expansion remains a key growth lever, but executives cautioned that AYON registrations face lengthy, country-specific timelines. The company could not provide firm launch schedules for major regions such as Europe, Latin America, the Middle East, and parts of Asia, adding uncertainty around near-term international contributions.
Forward-Looking Guidance and Cash Runway
Looking ahead, management’s upgraded revenue outlook calls for solid double-digit growth versus 2025, led by AYON and Surgical Aesthetics. They expect gross margins in the 62% to 63% range, operating expenses held under $45 million, and believe the current $31.1 million cash balance, coupled with working-capital discipline, should fund operations into 2027.
Apyx Medical’s earnings call painted a picture of a company gaining traction in its core aesthetics market while still working toward consistent profitability. For investors, the key themes were strong AYON-driven growth, expanding margins, and higher guidance, balanced against tariff headwinds, a shrinking OEM business, ongoing GAAP losses, and execution risk around regulatory timing and global rollout.