Myomo Earnings Call Shows Steady Gains Amid Headwinds

Myomo Inc ((MYO)) has held its Q1 earnings call. Read on for the main highlights of the call.

Myomo’s latest earnings call painted a cautiously upbeat picture, with modest revenue growth but clear operational momentum. Management emphasized improving margins, tighter cost control and a rapid shift toward recurring revenue streams, even as the company remains loss‑making and exposed to reimbursement and macro risks.

Steady Top-Line Growth with Reaffirmed Outlook

Myomo reported Q1 2026 revenue of $10.1 million, a 3% year‑over‑year increase that management framed as steady progress given a long revenue cycle. The company reiterated its full‑year revenue guidance of $43 million to $46 million, signaling confidence in pipeline conversion and channel expansion despite ongoing headwinds.

Average Selling Prices Benefit from Mix and Fee Updates

The average selling price rose 9% to $58,800 in Q1, helped by Medicare fee updates and a richer mix of international and Medicare Advantage revenue. Management reminded investors that long‑term planning still assumes an ASP closer to $55,000, implying some normalization as mix shifts over time.

Margins Edge Higher as Costs Are Held in Check

Gross margin improved by 100 basis points to 68.2%, while operating expenses edged down 1% to $10.1 million. Those trends narrowed the operating loss to $3.2 million from $3.5 million a year earlier, underscoring better operating efficiency even at relatively modest scale.

EBITDA Loss Narrows but Profitability Remains Distant

Adjusted EBITDA improved to a loss of $2.3 million from a $2.8 million loss, roughly a 20% year‑over‑year improvement. Management framed this as evidence of operating leverage beginning to show up, but acknowledged that sustained growth and cost discipline are still needed to reach break‑even.

Recurring Patient Sources Become a Core Growth Driver

Recurring patient sources accounted for 49% of Q1 revenue, nearly doubling from 25% a year earlier as programs like MyoConnect and rehab referrals gained traction. This shift toward repeat and referral business is central to Myomo’s strategy to smooth volatility and build a more predictable revenue base.

International and O&P Channels Power Expansion

International revenue hit a Q1 record of about $2.0 million, up 53% year‑over‑year, while U.S. O&P channel revenue surged 79%. Germany now counts more than 100 O&P practices working with Myomo, and the company signaled plans for further international expansion as execution and partnerships allow.

Growing Pipeline and Faster Fulfillment Boost Visibility

The patient pipeline reached 1,680, up 10% sequentially and 13% year‑over‑year, with 723 new patients added in the quarter. Fulfillment velocity increased as 62% of revenue units were fulfilled intra‑quarter versus 45% a year ago, while backlog ended at 226 patients, supporting near‑term revenue visibility.

Product Innovation and Clinical Work Underpin Future Demand

Myomo launched a new mobile app in March that management expects will cut material costs by about 10%, with benefits to gross margin starting in Q2. A randomized controlled trial at the University of Utah has enrolled 18 of 50 patients, and development of the next‑generation MyoPro 3 continues to advance.

Payer Contracts Expand Market Access and Coverage

The company signed a national arrangement with Elevance covering plans in 27 states, a key step in broadening U.S. access. Covered lives have jumped from 9 million to 158 million since April 2024, and management reported higher authorization rates where Myomo is now in‑network.

Improved Liquidity and Moderating Cash Burn

At quarter‑end, Myomo held $15.7 million in cash, cash equivalents and short‑term investments. Cash usage fell to $2.7 million from $3.2 million in the prior‑year quarter, indicating progress in managing burn while funding growth initiatives.

Profitability Still Out of Reach Despite Progress

The company posted a net loss of $3.0 million, or $0.07 per share, and adjusted EBITDA remained negative. Management acknowledged that Myomo is still a ways from profitability, even as incremental improvements suggest the business model is moving in the right direction.

Medicare Part B Contribution Under Pressure

Medicare Part B patients in the direct billing channel accounted for 51% of revenue, but dollar contribution fell 12% year‑over‑year. This reflects a changing payer mix and highlights pressure on a historically important cohort, adding complexity to revenue management.

Macro Challenges Temper Medicare Advantage Gains

Medicare Advantage revenue grew 11% year‑over‑year and represented 19% of Q1 revenue, but management flagged broader MA reimbursement dynamics as a headwind. Investors were reminded that even as MA grows, policy and rate uncertainty can limit upside and complicate contracting.

Transition Away from Direct Billing Brings Mix Risk

The direct billing channel’s share of revenue declined to 71% from 79% as Myomo leaned into recurring and partner‑based models. While this shift supports long‑term stability, it reduces near‑term higher‑margin direct sales and introduces mix risk during the transition phase.

On-Site Fit Costs Create Short-Term Margin Drag

Higher labor and travel costs for on‑site fittings partially offset the gross margin gains seen in Q1. Management warned that Q2 gross margin should be above last year but below Q1 levels, driven mainly by channel mix and these added service costs.

International Expansion Carries Execution Uncertainty

Discussions for a potential China joint venture remain ongoing without firm commitments, and broader international plans beyond Germany are still being evaluated. Management stressed that while global opportunity is significant, successful expansion will depend on partner selection and regulatory progress.

Dependence on Programs with Long Revenue Cycles

Myomo’s growth increasingly relies on scaling MyoConnect, new payer contracts and rehab and O&P partnerships, all of which involve multi‑month revenue cycles. Management highlighted that marketing and outreach spend may take four to six months or more to translate into recognized revenue, requiring patience from investors.

Guidance Points to Gradual Growth and Margin Gains

For Q2, Myomo guided revenue to $10.3 million to $10.8 million, implying 7% to 12% growth year‑over‑year and modest sequential gains. The company expects year‑over‑year gross margin expansion aided by a 10% material cost reduction from the new app, slightly higher operating expenses and full‑year revenue in the $43 million to $46 million range with operating expense growth targeted at roughly half the pace of revenue.

Myomo’s earnings call portrayed a company steadily tightening its operations, broadening access and deepening recurring relationships, even as it remains in investment mode. For investors, the story hinges on whether growing pipeline, payer coverage and product innovation can outpace reimbursement and mix headwinds long enough to push the business into sustainable profitability.