Myomo Inc ((MYO)) has held its Q2 earnings call. Read on for the main highlights of the call.
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The recent earnings call for Myomo Inc. was a mixed bag of strong growth and notable challenges. The company reported impressive revenue growth and international expansion, particularly in Germany, alongside a record number of pipeline additions. However, these positives were tempered by issues with lead quality and conversion rates, increased operating expenses, and a dip in Medicare Advantage revenue. Myomo is actively addressing these challenges through strategic adjustments, including cost-cutting measures and changes in advertising strategy.
Revenue Growth and International Expansion
Myomo reported a robust revenue of $9.7 million for Q2 2025, marking a 28% increase year-over-year. The international segment, especially in Germany, contributed significantly with $1.5 million, up 41% from the previous year. This growth underscores Myomo’s successful expansion efforts beyond domestic borders.
Record Pipeline Additions
The company achieved a milestone by adding a record 816 patients to its pipeline in the second quarter, a 49% increase over the prior year. This reflects Myomo’s effective lead generation strategies, although conversion remains a challenge.
Rising Average Selling Price
The average selling price of MyoPro units saw a 14% increase compared to the previous year, reaching approximately $54,200. This rise in ASP is a positive indicator of the product’s market value and demand.
Operational Efficiency and Cost Management
In a bid to enhance operational efficiency, Myomo reduced its U.S. headcount by 8% and cut back on outside services spending. These measures are expected to save at least $2 million over the next 12 months, reflecting the company’s commitment to cost management.
Challenges with Lead Quality and Conversion
Despite the record number of leads, Myomo faced difficulties in converting these into pipeline additions due to poor lead quality, particularly from Facebook. This issue highlights the need for improved lead vetting processes.
Increased Costs and Operating Losses
Operating expenses surged by 65% year-over-year, resulting in a significant operating loss of $4.6 million for Q2 2025, compared to $1.1 million in the previous year. This increase was driven by higher advertising and headcount costs.
Decline in Medicare Advantage Revenue
There was a slight decline in Medicare Advantage revenue, attributed to a high number of pre-authorization denials. This necessitated a lengthy appeals process, impacting revenue flow.
Higher Cost Per Pipeline Add
The cost per pipeline add rose to approximately $2,900, a significant increase from previous quarters. This was largely due to the lower quality of leads, which affected overall conversion efficiency.
Forward-Looking Guidance
Looking ahead, Myomo projects third-quarter revenue to be between $9.5 million and $10 million. The company has adjusted its full-year growth expectations to 23% to 29%, with anticipated revenue between $40 million and $42 million for 2025. Despite current challenges, these projections indicate a positive outlook for sustained growth.
In summary, Myomo Inc.’s earnings call revealed a company experiencing both significant growth and notable challenges. While international expansion and increased revenue are promising, issues with lead quality and rising costs present hurdles that the company is actively working to overcome. Investors will be keenly watching how Myomo navigates these challenges in the coming quarters.