Sanara MedTech ((SMTI)) has held its Q3 earnings call. Read on for the main highlights of the call.
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Sanara MedTech’s recent earnings call painted a picture of robust growth and strategic challenges. The overall sentiment was positive, with the company showcasing strong revenue growth and improved profitability, primarily driven by its core surgical business and strategic network expansion. However, the discontinuation of Tissue Health Plus and rising operating expenses were notable hurdles discussed during the call.
Strong Revenue Growth
Sanara MedTech’s surgical team reported impressive net revenue of $26.3 million in the third quarter of 2025, representing a 22% year-over-year increase. This growth was largely fueled by the success of their soft tissue repair products, highlighting the company’s effective market strategies and product demand.
Improved Profitability
The company announced a $1 million improvement in net income from continuing operations and a $2.3 million increase in adjusted EBITDA, driven by a net revenue growth of $4.7 million. These figures underscore Sanara’s ability to enhance profitability alongside revenue growth.
Expansion of Distributor Network
Over the past year, Sanara expanded its distributor network from 300 to over 400 contracted distributors. This strategic expansion has significantly enhanced the company’s market reach, positioning it for further growth in the competitive medtech landscape.
Clinical Evidence and New Product Initiatives
Sanara’s commitment to innovation was evident with the publication of two studies on CellerateRX in peer-reviewed journals, supporting its efficacy in complex surgical procedures. Additionally, progress was made with the OsStic product under the BMI partnership, showcasing the company’s focus on advancing its product portfolio.
Discontinuation of Tissue Health Plus
The earnings call revealed the cessation of operations for Tissue Health Plus (THP) after unsuccessful attempts to find a strategic partner or monetization option. This decision involves an anticipated cash investment of $5.5 million to $6.5 million in the second half of 2025, reflecting a strategic pivot in the company’s operations.
Increased Operating Expenses
Sanara reported a 14% increase in operating expenses, amounting to $21.5 million in the third quarter. This rise was primarily attributed to increases in compensation, contract services, and direct sales and marketing expenses, indicating the company’s investment in growth initiatives.
Higher Interest and Expense
The company experienced an increase in other expenses to $2.1 million, up from $1 million, primarily due to higher interest expenses and fees related to the CRG term loan. This highlights the financial implications of the company’s strategic financing decisions.
Forward-Looking Guidance
Looking ahead, Sanara MedTech anticipates high single-digit to low-teens revenue growth in the fourth quarter of 2025, excluding a $1.8 million headwind from the previous year’s extraordinary demand for BIASURGE. The company remains focused on driving sustainable growth, optimizing its commercial strategy, and leveraging its strong distributor network and clinical evidence to expand its market presence.
In summary, Sanara MedTech’s earnings call highlighted a positive trajectory with strong revenue growth and improved profitability, despite facing challenges such as the discontinuation of Tissue Health Plus and increased operating expenses. The company’s strategic expansion and innovative product initiatives position it well for future growth, as it continues to navigate the evolving medtech landscape.