Vericel Corporation ((VCEL)) has held its Q2 earnings call. Read on for the main highlights of the call.
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Vericel Corporation’s latest earnings call reflects a robust overall performance, highlighted by significant revenue and profitability growth, particularly in the MACI and Burn Care segments. While the company celebrates these achievements, challenges remain in Epicel revenue conversion and adjusted guidance for the Burn Care segment, which present areas of concern.
Record Revenue Growth
Vericel Corporation reported a 20% year-over-year increase in total revenue for Q2 2025, reaching $63.2 million. This impressive growth was primarily driven by the strong performance in the MACI and Burn Care segments, underscoring the company’s successful strategies in these areas.
Significant Profitability Improvement
The company achieved a remarkable 112% increase in adjusted EBITDA compared to the previous year, exceeding $13 million. This was accompanied by a gross margin expansion of more than 400 basis points, reaching 74%, highlighting Vericel’s enhanced operational efficiency and profitability.
MACI’s Record Performance
MACI delivered record second-quarter revenue of nearly $54 million, marking a 21% growth from the prior year. This success was attributed to strong business fundamentals and an expanded base of trained surgeons, positioning MACI as a key growth driver for Vericel.
Epicel and NexoBrid Surge
Epicel’s revenue increased by 11% year-over-year, supported by a 40% rise in biopsies. NexoBrid also showed impressive growth with a 52% year-over-year increase in revenue, driven by strong hospital orders, indicating robust demand in the burn care market.
Strategic Sales Force Expansion
In anticipation of continued growth, Vericel is expanding its MACI sales force from 76 to approximately 100 territories. This strategic move aims to support expected volume growth and further capitalize on the strong market demand.
Progress in Clinical Trials
Vericel received FDA clearance for the MACI ankle clinical study, which is expected to be a significant growth driver as the company expands into other orthopedic markets. This development underscores Vericel’s commitment to innovation and market expansion.
Challenges with Epicel Revenue Conversion
Despite strong biopsy growth, Epicel revenue was impacted by a higher ratio of canceled cases due to patient health-related issues. This led to more conservative guidance, highlighting the challenges in converting biopsies to revenue.
Guidance Adjustment for Burn Care
Vericel adjusted its Burn Care revenue guidance to align with recent run rates of approximately $10 million per quarter. This adjustment reflects the challenges in accurately forecasting revenue in this segment, necessitating a more cautious approach.
Forward-Looking Guidance
Vericel Corporation’s forward-looking guidance remains optimistic, with expectations of maintaining MACI revenue growth in the low 20% range. The company also anticipates third-quarter revenue growth to mirror this trend, reaffirming its profitability guidance with a 74% gross margin and a 26% adjusted EBITDA margin.
In conclusion, Vericel Corporation’s earnings call paints a picture of strong financial health and strategic growth, particularly in the MACI and Burn Care segments. While challenges exist, particularly in Epicel revenue conversion, the company’s forward-looking guidance remains positive, promising continued growth and profitability.