SANUWAVE Health Inc. Reports Robust Q1 Growth

SANUWAVE Health Inc. ((SNWV)) has held its Q1 earnings call. Read on for the main highlights of the call.

SANUWAVE Health Inc. has kicked off the year with a robust performance, as reflected in its latest earnings call. The company reported record-breaking revenue growth and improved gross margins, which are positive indicators of its financial health. However, the increase in operating expenses and net loss, along with a negative EBITDA, present notable challenges. The overall sentiment from the earnings call is balanced, highlighting both the company’s successes and the financial hurdles it faces.

Record-Breaking Revenue and Growth

SANUWAVE Health Inc. reported a remarkable 61% year-over-year increase in revenue for Q1 2025, totaling $9.3 million. This impressive growth surpassed the company’s previous guidance of 45% to 55%, showcasing its strong market performance and strategic initiatives.

Improved Gross Margins

The company achieved a significant improvement in gross margins, which rose to 79% in Q1 2025 from 72.6% in the same period last year. This increase of over 640 basis points reflects SANUWAVE’s effective cost management and pricing strategies.

Increase in System Placements

SANUWAVE successfully placed 98 new Altamist systems in Q1, marking a 28% increase from the previous year’s system sales. This growth indicates a rising demand for the company’s products and its ability to meet market needs.

Strong Inventory Position

The company has built up a robust inventory of Ultramist systems and components, ensuring it can rapidly scale production if necessary. This strategic move positions SANUWAVE well to capitalize on future growth opportunities.

Positive Adjusted EBITDA

SANUWAVE reported a positive adjusted EBITDA of $2.3 million for Q1 2025, a significant improvement from $59,000 in the same period last year. This $2.4 million year-over-year improvement highlights the company’s operational efficiency and financial discipline.

Increase in Operating Expenses

Operating expenses rose to $6.4 million in Q1 2025, up from $5.3 million the previous year. This increase was primarily due to a $1 million rise in noncash stock-based compensation and a $295,000 Nasdaq uplift expense, reflecting the company’s investment in growth and compliance.

Net Loss Increase

The net loss for Q1 2025 increased to $5.7 million, compared to $4.5 million in the same period in 2024. This was driven by higher noncash and infrequent expenses, highlighting areas where the company needs to focus on cost control.

Negative EBITDA

Despite the improvement in adjusted EBITDA, SANUWAVE reported a negative EBITDA of $3 million for Q1 2025. This underscores the financial challenges the company faces, even as it works to improve its profitability.

Optimistic Forward-Looking Guidance

Looking ahead, SANUWAVE Health Inc. provided optimistic guidance for the upcoming quarter and the full year. The company projects Q2 2025 revenues between $10 million and $10.7 million, indicating a year-on-year growth of 40% to 50%. This aligns with the company’s annual growth target of 47% to 53% for 2025. SANUWAVE’s focus on maintaining strong inventory levels and supply chain stability positions it well for continued growth.

In summary, SANUWAVE Health Inc.’s earnings call reflects a company experiencing strong growth and improved financial metrics, tempered by challenges such as increased expenses and a negative EBITDA. The company’s optimistic guidance and strategic initiatives suggest a positive outlook, but it must address its financial hurdles to sustain its momentum.