Biote Corp. Balances Recall Hit With Growth Plans

Biote Corp. ((BTMD)) has held its Q1 earnings call. Read on for the main highlights of the call.

Biote Corp.’s latest earnings call painted a mixed picture for investors, as a voluntary product recall weighed heavily on first-quarter results even as management highlighted solid progress in supplements, commercial expansion and operations. Executives struck a confident tone that the setbacks are temporary, reiterating full-year guidance and forecasting a return to procedure revenue growth later in 2026.

Dietary Supplements Provide a Bright Spot

Dietary supplement revenue jumped 19.1% year over year to $11.0 million in the first quarter, powered largely by continued strength in the e-commerce channel. Management framed this as an important growth pillar and now expects supplements to grow at a more modest mid- to high-single-digit pace for the full year.

Salesforce Expansion Targets Future Growth

Biote expanded its commercial organization significantly, growing from just over 90 representatives at the end of 2025 to about 120 in 2026. More than 25 new hires were added in the first quarter alone, positioning the company to increase sales capacity and support expansion of its practitioner network.

New Practitioner Training Builds Pipeline

The company trained more than 200 new practitioners in the quarter, a 16.5% increase versus the same period last year. Management views practitioner onboarding as a leading indicator, noting that newly trained clinicians typically take around six months to contribute meaningfully to procedure and supplement sales.

Full-Year Guidance Held Despite Headwinds

Despite the recall-driven setback, Biote maintained its 2026 outlook for revenue above $190 million and adjusted EBITDA greater than $38 million. The decision signals management’s confidence that the recall impact is transitory and that underlying demand trends remain intact.

Operational Remediation at Asteria Health

Biote’s manufacturing partner Asteria Health has added a second shift and other measures to increase production and rebuild safety stock. Management expects Asteria’s supply continuity to be fully restored by the end of the second quarter while relying on third-party partners to bridge near-term demand.

Clinic Attrition Remains Contained

Management reported that clinic attrition has stabilized and that there was no meaningful uptick tied to the recall episode. Executives also pointed to anecdotal signs of improving daily volumes before the recall, suggesting underlying demand may be healthier than headline figures imply.

Cash Generation and Balance Sheet Actions

Operating cash flow reached $3.9 million in the quarter, and cash and cash equivalents stood at $5.3 million as of March 31. The company also fully repaid the remaining balance under its share repurchase liabilities in January, providing some incremental balance sheet clarity.

Revenue Declines Under Recall Pressure

Total revenue fell 8.3% year over year to $44.9 million in the first quarter, reflecting the strain from supply disruptions. Procedure revenue dropped 13.2% to $31.3 million, and management estimated that about $1.7 million of that shortfall was directly related to the voluntary product recall.

Recall Costs and Sales Disruption

The recall of certain bio-identical hormone pellets not only cut into revenue but also added roughly $1.5 million in incremental costs. Management noted that the event diverted sales teams from their usual growth activities as representatives focused on servicing affected accounts.

Gross Margin Compression from Recall and Mix

Gross margin slid to 68.9% from 74.3% a year earlier, a decline of about 5.4 percentage points. The drop was driven by $1.1 million in recall-related costs and a heavier reliance on third-party supplied products, which carry lower profitability.

Net Income and EPS Under Significant Pressure

Net income tumbled to $2.7 million, or $0.06 per diluted share, compared with $15.8 million and $0.37 per share in the prior-year period. The comparison was also affected by smaller gains from changes in the fair value of earn-out liabilities, which fell to $2.1 million from $10.7 million.

Adjusted EBITDA and Margin Take a Hit

Adjusted EBITDA declined to $8.7 million, translating to a margin of 19.4% as the company absorbed lower sales and thinner gross profits. Higher operating expenses related in part to the recall further squeezed margins, underscoring the near-term earnings impact.

Reduced In-House Production and Mix Headwinds

Asteria Health produced about 30% of shipped pellets in the quarter, down sharply from more than 50% in the fourth quarter of 2025. This shortfall forced Biote to lean more heavily on third-party suppliers, generating temporary mix and margin headwinds that are expected to persist into the second quarter.

Higher Operating Expenses Weigh on Results

Selling, general and administrative expenses rose 4.1% to $27.8 million, driven by higher legal costs and roughly $0.4 million related to the recall. The rise in overhead adds another layer of pressure to earnings as the company invests to support its expanded sales force and remediation efforts.

Guidance Anchored to Recovery in Second Half

Biote reiterated its full-year targets, calling for revenue above $190 million and adjusted EBITDA above $38 million, with supplements growing at a mid- to high-single-digit rate. Management expects procedure revenue to return to growth in the second half of 2026 as Asteria supply is fully restored by the end of the second quarter, though they cautioned that second-quarter gross margins will remain pressured by reliance on third-party supply.

Biote’s first-quarter earnings call highlighted a company managing through a self-inflicted but temporary setback while still investing for growth. Investors will now watch whether the restored supply chain, expanded sales force and growing practitioner base can translate into the second-half recovery that management is promising, and whether margins rebound as the recall fades into the rear-view mirror.