Myomo Inc Reports Strong Q1 Revenue Amid Challenges

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

Myomo Inc’s recent earnings call painted a picture of both triumph and challenge. The company reported strong revenue growth and promising developments in its O&P channel and international markets. However, it faced hurdles in lead generation due to Meta’s policy changes and high denial rates from Medicare Advantage plans, impacting authorization rates and operating expenses. Despite these obstacles, Myomo expressed confidence in overcoming these challenges and maintained its full-year guidance.

Record Revenue Growth in Q1 2025

In the first quarter of 2025, Myomo achieved a remarkable revenue increase of over 160%, reaching $9.8 million. This growth was fueled by a 100% rise in MyoPro units delivered year-over-year and a 31% increase in the average selling price. This record growth underscores the company’s successful strategies in expanding its market presence.

Significant Growth in Medicare Part B Revenue

Medicare Part B patients played a crucial role in Myomo’s revenue, contributing to 60% of the total. This highlights the strong adoption and coverage of MyoPro devices within this segment, showcasing the company’s ability to tap into established healthcare channels effectively.

Expansion of O&P Channel

Myomo made significant strides in its O&P channel, completing training for over 300 Certified Prosthetist Orthotists (CPOs), up from 160. This expansion is part of the company’s efforts to establish Certified MyoPro Centers of Excellence, enhancing its distribution network and service quality.

International Sales Performance

The international market, particularly Germany, contributed over $1.3 million to Myomo’s revenue, indicating robust growth outside the domestic market. This performance reflects the company’s successful international expansion strategy.

Challenges with Lead Generation

The company faced challenges in lead generation due to changes in Meta’s marketing policies. These changes initially resulted in fewer patients moving through the authorization process, highlighting the impact of external factors on Myomo’s operational efficiency.

High Denial Rates from Medicare Advantage Plans

Medicare Advantage and certain commercial insurance plans continued to pose challenges, with high denial or delay rates affecting the authorization process. Despite an 18% year-over-year increase in authorization rates, these hurdles remain a significant concern.

Increased Costs and Operating Expenses

Operating expenses surged by 64% over the previous year, driven by higher headcount, increased advertising spend, and R&D expenses. This led to an operating loss of $3.5 million, reflecting the cost pressures Myomo is navigating.

Decrease in Backlog

The company’s backlog decreased by 9% year-over-year, attributed to fewer pre-authorizations and a backend loading of pipeline adds due to the Meta algorithm change. This decrease signals challenges in maintaining a steady pipeline flow.

Forward-Looking Guidance

Despite the challenges faced, Myomo maintained a positive outlook for 2025. The company expects full-year revenue to range between $50 million and $53 million, representing growth of 54% to 66% over the previous year. Myomo also plans to continue expanding its O&P distribution channel and addressing insurance authorization challenges to enhance market penetration.

In summary, Myomo Inc’s earnings call reflected a mix of strong growth and operational challenges. The company demonstrated significant revenue increases and strategic advancements in its O&P and international channels. However, it continues to face hurdles in lead generation and insurance authorizations. Despite these challenges, Myomo remains optimistic about its growth prospects and strategic initiatives for 2025.