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Iridex Corp (IRIX)
NASDAQ:IRIX
US Market
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Iridex (IRIX) AI Stock Analysis

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IRIX

Iridex

(NASDAQ:IRIX)

Rating:48Neutral
Price Target:
$1.50
▲(20.97% Upside)
Iridex's overall stock score is primarily impacted by its weak financial performance, characterized by declining revenues and negative profit margins. While the earnings call and corporate events provide some positive outlooks, the technical analysis and valuation concerns weigh heavily on the score.

Iridex (IRIX) vs. SPDR S&P 500 ETF (SPY)

Iridex Business Overview & Revenue Model

Company DescriptionIRIDEX Corporation, an ophthalmic medical technology company, provides therapeutic based laser systems, delivery devices, and consumable instrumentation to treat sight-threatening eye diseases in ophthalmology. It offers laser consoles, such as Cyclo G6 laser system for use in the treatment of glaucoma; IQ 532 and IQ 577 laser photocoagulation systems, which are used for the treatment of diabetic macular edema and other retinal diseases; and OcuLight TX, OcuLight SL, OcuLight SLx, OcuLight GL, and OcuLight GLx laser photocoagulation systems that are used to treat proliferative diabetic retinopathy, macular holes, retinal tears, and detachments. The company also provides delivery devices, including TxCell scanning laser delivery system that allows the physician to perform multi-spot pattern scanning; slit lamp adapter, which allows the physician to utilize a standard slit lamp in diagnosis and treatment procedures; and laser indirect ophthalmoscope for use in procedures to treat peripheral retinal disorders. It offers MicroPulse P3 Probe, which is used with its Cylco G6 laser system to perform MicroPulse transscleral laser therapy; G-Probe, which is used in procedures to treat uncontrolled glaucoma; G-Probe and G-Probe Illuminate, which are used in procedures to treat refractory glaucoma; and EndoProbe family of products for use in vitrectomy procedures. The company serves ophthalmologists, research and teaching hospitals, government installations, surgical centers, hospitals, veterinary practices, and office clinics. It markets its products through direct and independent sales force in the United States, as well as through independent distributors internationally. The company was formerly known as IRIS Medical Instruments, Inc. and changed its name to IRIDEX Corporation in November 1995. IRIDEX Corporation was incorporated in 1989 and is headquartered in Mountain View, California.
How the Company Makes MoneyIridex generates revenue through multiple streams, primarily from the sale of its laser systems and associated disposable products used in ophthalmic procedures. The company sells its laser systems to hospitals and outpatient surgery centers, which are then used in various surgical procedures. Additionally, Iridex earns recurring revenue from the sale of consumables that are required for each procedure. Key revenue streams include direct sales of capital equipment, sales of consumables that accompany the equipment, and service agreements providing maintenance and support for their systems. Partnerships with healthcare providers, hospitals, and clinics are significant, as they help to expand the reach of Iridex's products and enhance its market presence. The company also invests in research and development to innovate new therapies, which can lead to additional revenue opportunities in the long term.

Iridex Earnings Call Summary

Earnings Call Date:Aug 12, 2025
(Q2-2025)
|
% Change Since: -4.62%|
Next Earnings Date:Nov 18, 2025
Earnings Call Sentiment Neutral
The earnings call reflected a mix of positive revenue growth and significant cost reductions alongside challenges such as declining gross margins and regional sales issues. The company's successful implementation of efficiency measures and positive adjusted EBITDA were tempered by ongoing market challenges and a net loss.
Q2-2025 Updates
Positive Updates
Year-Over-Year Revenue Growth
IRIDEX achieved a 7% year-over-year revenue growth in Q2 2025, with total revenues of $13.6 million.
Sequential Revenue Growth
The company saw a 14% sequential growth compared to Q1 2025, driven by higher laser console sales.
Expense Reduction Achievements
Operating expenses were reduced by 28% compared to the prior year period, contributing to improved financial health.
Positive Adjusted EBITDA
IRIDEX reported a positive non-GAAP adjusted EBITDA of $21,000 for Q2 2025, an improvement of $1.7 million compared to the previous year.
Strong Pascal System Sales
High sales of the Pascal system contributed to the growth in both the U.S. and international markets, particularly in the Middle East and Africa.
Cash Burn Reduction
Cash and cash equivalents decreased only by $0.4 million, indicating a reduction in cash usage.
Negative Updates
Gross Margin Decline
Gross margin decreased to 34.5% in Q2 2025 from 40.7% in Q2 2024, primarily due to increased manufacturing costs and product mix.
Challenges in Asia
Uncertainty around tariffs with China and logistical delays in Japan affected Q2 and potentially future quarters' performance.
Lower G6 and Surgical Retina Probe Sales
There was a decrease in G6 and surgical retina probe sales, partially offsetting the growth in other areas.
Net Loss
The company reported a net loss of $1.0 million or $0.06 per share for Q2 2025, although this was an improvement from the previous year's net loss.
Pricing Pressures in Latin America and Canada
Pascal sales in Latin America and Canada fell short of expectations due to pricing pressures.
Company Guidance
During the second quarter of 2025, IRIDEX reported promising financial results, showcasing a year-over-year revenue growth of 7% and a sequential growth of 14%, culminating in a revenue of $13.6 million. Operating expenses were reduced by 28% compared to the prior year period, contributing to a net loss reduction from $2.7 million to $1.0 million. The company achieved a positive adjusted EBITDA of $21,000, a significant improvement from a loss of $1.7 million in Q2 2024. Gross margin, however, decreased to 34.5% from 40.7% due to increased manufacturing costs and tariffs. Despite these challenges, IRIDEX maintained robust sales in its retina and glaucoma product lines, particularly noting strong performance in Pascal system sales, and aims to further reduce operating expenses and improve gross margins through strategic actions such as renegotiating manufacturing contracts and relocating facilities. The company remains on track to achieve its financial goals of cash flow breakeven and positive adjusted EBITDA for the year.

Iridex Financial Statement Overview

Summary
Iridex is experiencing significant financial challenges with declining revenues, negative profit margins, and weakening balance sheet metrics. The ongoing negative cash flows and increasing leverage highlight liquidity and financial sustainability concerns. Strategic interventions are necessary to stabilize and improve financial health.
Income Statement
45
Neutral
Iridex has faced declining revenue over recent years, with a notable decrease from $56.97 million in 2022 to $48.67 million in 2024. The gross profit margin has also declined from 44.5% in 2022 to 40.1% in 2024, indicating eroding profitability. The company has consistently reported negative EBIT and EBITDA margins, reflecting ongoing operational challenges and unprofitability.
Balance Sheet
40
Negative
The balance sheet reflects a concerning financial position with stockholders' equity significantly declining from $23.3 million in 2022 to $2.1 million in 2024. The debt-to-equity ratio has increased substantially due to the lower equity base, posing potential financial risk. The equity ratio dropped from 35.4% in 2022 to 7.2% in 2024, indicating weakened financial stability.
Cash Flow
35
Negative
Iridex's cash flow situation is challenging, with negative operating cash flow and free cash flow observed over the recent years. Operating cash flow to net income ratio remains negative, implying inefficiencies in cash generation from operations. The free cash flow growth rate is negative, exacerbating liquidity concerns.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue49.74M48.67M51.87M56.97M53.90M36.35M
Gross Profit19.57M19.50M21.81M25.37M22.83M15.56M
EBITDA-2.52M-6.88M-7.97M-6.16M-6.73M-6.08M
Net Income-5.45M-8.91M-9.57M-7.55M-5.22M-6.33M
Balance Sheet
Total Assets31.59M29.14M34.44M42.29M48.69M27.97M
Cash, Cash Equivalents and Short-Term Investments6.78M2.39M7.03M13.92M23.85M11.63M
Total Debt5.07M4.64M2.75M1.77M2.66M4.19M
Total Liabilities25.53M27.04M24.91M25.06M25.39M10.60M
Stockholders Equity6.06M2.10M9.52M17.23M23.30M17.37M
Cash Flow
Free Cash Flow-5.86M-7.30M-6.85M-9.80M8.00M-3.33M
Operating Cash Flow-5.86M-7.29M-6.75M-9.52M8.22M-3.24M
Investing Cash Flow-34.00K-13.00K-109.00K-286.00K-5.56M-93.00K
Financing Cash Flow8.63M2.60M-5.00K-73.00K9.47M2.47M

Iridex Technical Analysis

Technical Analysis Sentiment
Positive
Last Price1.24
Price Trends
50DMA
1.14
Positive
100DMA
1.09
Positive
200DMA
1.30
Negative
Market Momentum
MACD
<0.01
Positive
RSI
51.74
Neutral
STOCH
65.41
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IRIX, the sentiment is Positive. The current price of 1.24 is below the 20-day moving average (MA) of 1.27, above the 50-day MA of 1.14, and below the 200-day MA of 1.30, indicating a neutral trend. The MACD of <0.01 indicates Positive momentum. The RSI at 51.74 is Neutral, neither overbought nor oversold. The STOCH value of 65.41 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IRIX.

Iridex Risk Analysis

Iridex disclosed 48 risk factors in its most recent earnings report. Iridex reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Iridex Peers Comparison

Overall Rating
UnderperformOutperform
Sector (51)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
51
Neutral
$7.82B-0.16-39.78%2.19%21.38%-1.56%
48
Neutral
$20.56M-105.72%0.09%51.09%
43
Neutral
$9.66M-114.90%4.96%-13.09%
40
Underperform
$18.84M-329.16%15.00%71.57%
37
Underperform
$25.00
-2.99%59.87%
35
Underperform
$32.02M-196.69%
34
Underperform
$176.00M5400.35%-67.50%45.54%
* Healthcare Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
IRIX
Iridex
1.24
-0.71
-36.41%
AXDXQ
Accelerate Diagnostics
0.01
-1.81
-99.45%
LFWD
Lifeward
0.62
-2.82
-81.98%
BSGM
BioSig Technologies
5.18
4.73
1051.11%
ADGM
Adagio Medical Holdings
1.29
-3.81
-74.71%
IINN
Inspira Technologies Oxy BHN
1.17
0.03
2.63%

Iridex Corporate Events

Shareholder MeetingsBusiness Operations and Strategy
Iridex Stockholders Approve Key Proposals at Annual Meeting
Positive
Jun 13, 2025

On June 11, 2025, Iridex Corporation held its Annual Meeting of Stockholders at its headquarters in Mountain View, California, where several key proposals were approved. Notably, the stockholders approved an amendment to the 2008 Equity Incentive Plan, increasing the shares reserved for issuance and extending the plan’s term. Additionally, the appointment of BPM LLP as the independent registered public accounting firm was ratified, and various governance-related proposals were passed, including the election of directors and amendments to the company’s charter. These decisions reflect a strategic effort to enhance corporate governance and operational flexibility, potentially impacting the company’s future growth and shareholder value.

Business Operations and Strategy
Iridex Amends Investor Rights Agreement with Novel
Neutral
May 22, 2025

On May 20, 2025, IRIDEX Corporation amended its Investor Rights Agreement with Novel Inspiration International Co., Ltd. The amendment restricts the company from disposing of a substantial portion of its assets without unanimous board approval, unless the transaction involves a wholly-owned subsidiary.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Aug 21, 2025