Zynex Reports Second Quarter 2025 Financial Results
Rhea-AI Summary
Zynex (NASDAQ: ZYXI) reported challenging Q2 2025 financial results, with net revenue declining to $22.3 million from $49.9 million year-over-year. The company posted a net loss of ($20.0 million), or ($0.66) per share, compared to net income of $1.2 million in Q2 2024.
Two significant developments marked the quarter: the appointment of Steven Dyson as new CEO, bringing 25 years of medical technology experience, and the FDA submission of their NiCO laser pulse oximeter. The company implemented efficiency improvements targeting $40 million in annualized savings, primarily effective in Q3 and Q4. Due to leadership changes, Zynex has temporarily suspended revenue and profitability guidance.
Cash and cash equivalents stood at $17.5 million, with quarterly cash collections of $26.1 million. The company's gross profit margin decreased to 68% from 80% year-over-year, affected by the Tricare payment suspension and ongoing operational restructuring.
Positive
- Implemented efficiency improvements targeting $40 million in annualized savings
- FDA submission of innovative NiCO laser pulse oximeter
- Appointed experienced CEO Steven Dyson with 25 years of medical technology expertise
- Reduced sales and marketing expenses by 45% year-over-year
- Maintained strong gross profit margin of 68% despite challenges
Negative
- Net revenue declined 55% to $22.3 million from $49.9 million year-over-year
- Posted net loss of ($20.0 million) compared to $1.2 million profit in Q2 2024
- Negative cash flow from operations of ($6.2 million) for the quarter
- Suspended revenue and profitability guidance due to leadership changes
- Tricare payment suspension continues to impact revenue and operations
News Market Reaction
On the day this news was published, ZYXI declined 43.27%, reflecting a significant negative market reaction. Argus tracked a trough of -47.7% from its starting point during tracking. Our momentum scanner triggered 69 alerts that day, indicating high trading interest and price volatility. This price movement removed approximately $54M from the company's valuation, bringing the market cap to $71M at that time. Trading volume was exceptionally heavy at 16.0x the daily average, suggesting significant selling pressure.
Data tracked by StockTitan Argus on the day of publication.
Management Commentary
"In the second quarter of 2025, we completed two transformational events. First, we appointed Steven Dyson as our new CEO. Steven brings over 25 years of experience in the medical technology sector, primarily through his leadership at Apax, a global private equity firm. Steven brings deep expertise and a proven track record in the medical sector. His leadership will be instrumental as we refocus our business strategy toward a more optimized payer mix and work to return Zynex to a strong growth trajectory," said Thomas Sandgaard, Founder and CEO of Zynex. "Second, we submitted our NiCO laser pulse oximeter to the FDA. This submission marks a historic milestone in the evolution of pulse oximetry and a major breakthrough in our mission to improve the quality of care and patient outcomes through our patient monitoring products."
"During the quarter we continued our efforts to refocus our sales force and operations to reflect the current landscape of insurance coverage and have made significant strides towards our goal of returning to positive cash-flow. We have implemented several efficiency improvements to internal operations, reallocating staff to more profitable business lines, reducing our cost of goods sold, and updating our organizational structure while driving the sales force to become more efficient and productive. These improvements will result in annualized savings of approximately
"We strongly believe in our commitment to help patients with the best products for pain relief without the side effects that are associated with opioids. We are confident that our efforts to reduce costs and redirecting our sales force will be pivotal to improved cash flow and create a foundation for continuing to grow into the huge demand for our products."
Second Quarter 2025 Financial Results
Net revenue was
Gross profit in the quarter ended June 30, 2025, was
Sales and marketing expense for the three months ended June 30, 2025, decreased
General and administrative expenses for the three months ended June 30, 2025, were
Net loss for the three months ended June 30, 2025, totaled
Adjusted EBITDA loss for the three months ended June 30, 2025, was
Cash collections were
Third Quarter 2025 Guidance
With the retirement of our current Chief Executive Officer and the announced departure of our Chief Financial Officer, the Company is temporarily suspending revenue and profitability guidance. Steven Dyson, the incoming Chief Executive Officer, will lead a review of the Company's forecasting procedures and will provide an update to investors on the potential resumption of guidance in the coming quarters.
Conference Call and Webcast Details
Date: Thursday, July 31, 2025
Time: 4:15 PM Eastern Time (2:15 PM Mountain Time)
International number: 646-357-8785
Webcast: Q2-2025 Webcast Link
Non-GAAP Financial Measures
Zynex reports its financial results in accordance with accounting principles generally accepted in the
Safe Harbor Statement
This press release contains forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995, as amended. our results of operations and the plans, strategies and objectives for future operations; the timing and scope of any potential stock repurchase; and other similar statements.
Words such as "anticipate," "believe," "continue," "could," "designed," "endeavor," "estimate," "expect," "intend," "may," "might," "plan," "potential," "predict," "project," "seek," "should," "target," "preliminary," "will," "would" and similar expressions are intended to identify forward-looking statements. The express or implied forward-looking statements included in this press release are only predictions and are subject to a number of risks, uncertainties and assumptions. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. The Company makes no express or implied representation or warranty as to the completeness of forward-looking statements or, in the case of projections, as to their attainability or the accuracy and completeness of the assumptions from which they are derived. Factors that could cause actual results to materially differ from forward-looking statements include, but are not limited to, the need to obtain CE marking of new products; the acceptance of new products as well as existing products by doctors and hospitals, larger competitors with greater financial resources; the need to keep pace with technological changes; our dependence on the reimbursement for our products from health insurance companies; the outcome of the Tricare payment suspension; our dependence on first party manufacturers to produce our products on time and to our specifications' implementation of our sales strategy including a strong direct sales force, market conditions; economic factors, such as interest rate fluctuations; and other risks described in our filings with the Securities and Exchange Commission.
These and other risks are described in our filings with the Securities and Exchange Commission including but not limited to, our Annual Report on Form 10-K for the year ended December 31, 2024, as well as our quarterly reports on Form 10-Q and current reports on Form 8-K. Any forward-looking statements contained in this press release represent Zynex's views only as of today and should not be relied upon as representing its views as of any subsequent date. Zynex explicitly disclaims any obligation to update any forward-looking statements, except to the extent required by law.
About Zynex, Inc.
Zynex, founded in 1996, develops, manufactures, markets, and sells medical devices used for pain management and rehabilitation as well as non-invasive fluid, sepsis, and laser-based pulse oximetry monitoring systems for use in hospitals. For additional information, please visit: www.zynex.com.
Investor Relations Contact:
Dan Moorhead, CFO
ir@zynex.com
ZYNEX, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (AMOUNTS IN THOUSANDS) (unaudited)
| ||||||
June 30, | December 31, | |||||
2025 | 2024 | |||||
ASSETS | ||||||
Current assets | ||||||
Cash and cash equivalents | $ | 17,543 | $ | 39,631 | ||
Accounts receivable, net | 10,345 | 18,022 | ||||
Inventory, net | 12,211 | 13,919 | ||||
Prepaid expenses and other | 5,501 | 3,607 | ||||
Total current assets | 45,600 | 75,179 | ||||
Property and equipment, net | 2,862 | 3,084 | ||||
Operating lease asset | 8,873 | 9,820 | ||||
Finance lease asset | 994 | 1,141 | ||||
Deposits | 408 | 408 | ||||
Intangible assets, net of accumulated amortization | 6,797 | 7,247 | ||||
Goodwill | 20,401 | 20,401 | ||||
Deferred income taxes | — | 4,799 | ||||
Total assets | $ | 85,935 | $ | 122,079 | ||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||
Current liabilities | ||||||
Accounts payable and accrued expenses | 7,349 | 7,091 | ||||
Operating lease liability | 4,217 | 4,030 | ||||
Finance lease liability | 290 | 287 | ||||
Current portion of convertible senior notes, less issuance costs | 59,074 | — | ||||
Accrued payroll and related taxes | 2,929 | 5,456 | ||||
Total current liabilities | 73,859 | 16,864 | ||||
Convertible senior notes, less issuance costs | — | 58,567 | ||||
Operating lease liability | 8,171 | 10,151 | ||||
Finance lease liability | 708 | 789 | ||||
Deferred tax liabilities, net | 1,936 | — | ||||
Total liabilities | 84,674 | 86,371 | ||||
Stockholders' equity | ||||||
Common stock | 30 | 32 | ||||
Additional paid-in capital | 94,009 | 93,088 | ||||
Treasury stock, at cost | (92,123) | (87,186) | ||||
Retained earnings | (655) | 29,774 | ||||
Total stockholders' equity | 1,261 | 35,708 | ||||
Total liabilities and stockholders' equity | $ | 85,935 | $ | 122,079 | ||
ZYNEX, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS) (AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA) (unaudited) | ||||||||||||
For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||
2025 | 2024 | 2025 | 2024 | |||||||||
NET REVENUE | ||||||||||||
Devices | $ | 11,034 | $ | 15,920 | $ | 22,932 | $ | 29,945 | ||||
Supplies | 11,256 | 33,963 | 25,936 | 66,469 | ||||||||
Total net revenue | 22,290 | 49,883 | 48,868 | 96,414 | ||||||||
COSTS OF REVENUE AND OPERATING EXPENSES | ||||||||||||
Costs of revenue - devices and supplies | 7,055 | 9,971 | 15,424 | 19,269 | ||||||||
Sales and marketing | 12,811 | 23,226 | 29,751 | 46,606 | ||||||||
General and administrative | 12,707 | 14,460 | 27,073 | 27,788 | ||||||||
Total costs of revenue and operating expenses | 32,573 | 47,657 | 72,248 | 93,663 | ||||||||
Income (loss) from operations | (10,283) | 2,226 | (23,380) | 2,751 | ||||||||
Other income (expense) | ||||||||||||
Gain on disposal of assets | — | 19 | — | 19 | ||||||||
Interest expense, net | (834) | (630) | (1,537) | (1,142) | ||||||||
Other income (expense), net | (834) | (611) | (1,537) | (1,123) | ||||||||
Income (loss) from operations before income taxes | (11,117) | 1,615 | (24,917) | 1,628 | ||||||||
Income tax expense | 8,916 | 398 | 5,512 | 401 | ||||||||
Net income (loss) | $ | (20,033) | $ | 1,217 | $ | (30,429) | $ | 1,227 | ||||
Net income (loss) per share: | ||||||||||||
Basic | $ | (0.66) | $ | 0.04 | $ | (0.98) | $ | 0.04 | ||||
Diluted | $ | (0.66) | $ | 0.04 | $ | (0.98) | $ | 0.04 | ||||
Weighted average basic shares outstanding | 30,258 | 31,762 | 30,927 | 32,053 | ||||||||
Weighted average diluted shares outstanding | 30,258 | 32,204 | 30,927 | 32,516 | ||||||||
ZYNEX, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (AMOUNTS IN THOUSANDS) (unaudited) | ||||||
For the Six Months Ended June 30, | ||||||
2025 | 2024 | |||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||
Net income (loss) | $ | (30,429) | $ | 1,227 | ||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||||||
Depreciation | 1,166 | 1,329 | ||||
Amortization | 963 | 928 | ||||
Stock-based compensation | 1,136 | 1,575 | ||||
Non-cash lease expense | (586) | (467) | ||||
Provision (benefit) for deferred income taxes | 6,735 | (195) | ||||
Gain on disposal of assets | — | (19) | ||||
Change in operating assets and liabilities: | ||||||
Accounts receivable | 7,677 | 3,244 | ||||
Prepaid and other assets | (1,493) | (805) | ||||
Accounts payable and other accrued expenses | (2,989) | (288) | ||||
Inventory | 1,118 | (3,327) | ||||
Deposits | (1) | — | ||||
Net cash provided by (used in) operating activities | (16,703) | 3,202 | ||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||
Purchase of property and equipment | (197) | (290) | ||||
Net cash (used in) investing activities | (197) | (290) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||
Payments on finance lease obligations | (79) | (148) | ||||
Cash dividends paid | — | (3) | ||||
Purchase of treasury stock | (4,939) | (15,625) | ||||
Excise tax payments on net treasury stock purchases | — | (473) | ||||
Proceeds from the issuance of common stock on stock-based awards | 7 | 13 | ||||
Taxes withheld and paid on equity awards | (177) | (359) | ||||
Net cash (used in) financing activities | (5,188) | (16,595) | ||||
Net decrease in cash | (22,088) | (13,683) | ||||
Cash and cash equivalents at beginning of period | 39,631 | 44,579 | ||||
Cash and cash equivalents at end of period | $ | 17,543 | $ | 30,896 | ||
ZYNEX, INC. RECONCILIATION OF GAAP TO NON-GAAP MEASURES (AMOUNTS IN THOUSANDS) (unaudited) | |||||||||||||
For the Three Months Ended June 30, | For the Six Months Ended June 30, | ||||||||||||
2025 | 2024 | 2025 | 2024 | ||||||||||
Adjusted EBITDA: | |||||||||||||
Net income | $ | (20,033) | $ | 1,217 | $ | (30,429) | $ | 1,227 | |||||
Depreciation and Amortization* | 498 | 465 | 1,007 | 891 | |||||||||
Stock-based compensation expense | 559 | 841 | 1,136 | 1,575 | |||||||||
Interest expense and other, net | 834 | 611 | 1,537 | 1,123 | |||||||||
Restructuring charges** | 327 | - | 554 | - | |||||||||
Income tax (benefit) expense | 8,916 | 398 | 5,512 | 401 | |||||||||
Adjusted EBITDA | $ | (8,899) | $ | 3,532 | $ | (20,683) | $ | 5,217 | |||||
% of Net Revenue | (40) | % | 7 | % | (42) | % | 3 | % | |||||
* Depreciation does not include amounts related to units on lease to third parties which are depreciated and included in cost of goods sold. |
** Severance of former corporate employees which were fully expensed in Q1 and Q2-2025. |
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SOURCE Zynex, Inc.
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