Sanara MedTech (SMTI) posts Q1 profit, backs 13–17% 2026 growth
Rhea-AI Filing Summary
Sanara MedTech Inc. reported strong first quarter 2026 results with higher growth and a swing to profitability. Net revenue rose 19% to $27.8 million, driven mainly by a 21% increase in soft tissue repair product sales, while bone fusion revenue was slightly lower.
Gross profit reached $25.9 million with a 93% margin, up from 92%. Operating income more than tripled to $2.6 million. Net income from continuing operations was $0.4 million, or $0.04 per diluted share, compared with a loss a year earlier, and total net income was $0.46 million. Adjusted EBITDA increased 58% to $4.3 million, reflecting operating leverage despite higher selling and marketing costs.
Sanara ended March 31, 2026 with $13.6 million in cash and $46.2 million of long-term debt. The company guided second quarter 2026 net revenue to $28.5–$29.5 million (10–14% growth) and reaffirmed full-year 2026 net revenue guidance of $116–$121 million, implying 13–17% growth over 2025.
Positive
- Profitable growth with higher margins: Q1 2026 net revenue rose 19% to $27.8 million, gross margin improved to 93%, operating income more than tripled to $2.6 million, and net income from continuing operations reached $0.4 million versus a loss a year earlier.
Negative
- None.
Insights
Sanara delivered profitable growth and reaffirmed double-digit 2026 guidance.
Sanara MedTech grew Q1 2026 net revenue 19% to $27.8 million, with soft tissue repair products up 21%. Gross margin improved to 93%, and operating income rose to $2.6 million from $0.8 million, showing better scale in its focused surgical business.
Net income from continuing operations was $0.4 million versus a prior-year loss, while Adjusted EBITDA climbed 58% to $4.3 million. Management highlighted stronger surgeon adoption, 43 sales reps, presence in over 4,000 contracted or approved facilities, and more than 450 distributor agreements supporting growth.
Despite higher interest expense and net cash used in operations of $2.5 million, the company ended March 31, 2026 with $13.6 million in cash and $46.2 million of long-term debt. It guided Q2 2026 revenue to $28.5–$29.5 million and reaffirmed full-year 2026 revenue guidance of $116–$121 million, implying 13–17% growth over 2025.
8-K Event Classification
Key Figures
Key Terms
Adjusted EBITDA financial
discontinued operations financial
equity method investments financial
earnout liabilities financial
non-GAAP financial measures financial
Earnings Snapshot
Q2 2026 net revenue of $28.5–$29.5 million (10–14% growth) and full-year 2026 net revenue of $116–$121 million (13–17% growth vs 2025).
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
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of Report (Date of earliest event reported):
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 2.02 | Results of Operations and Financial Condition. |
On May 11, 2026, Sanara MedTech Inc. (the “Company”) issued a press release announcing its financial results for the quarter ended March 31, 2026. A copy of the Company’s press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated by reference herein.
The information in this Current Report on Form 8-K, including Exhibit 99.1 furnished hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth in such filing.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
| Exhibit No. | Description | |
| 99.1 | Press Release issued May 11, 2026 (furnished pursuant to Item 2.02). | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: | May 11, 2026 | ||
| Sanara MedTech Inc. | |||
| By: | /s/ Elizabeth B. Taylor | ||
| Name: | Elizabeth B. Taylor | ||
| Title: | Chief Financial Officer | ||
Exhibit 99.1
Sanara MedTech Inc. Reports First Quarter 2026 Financial Results (Unaudited)
Net Revenue Growth of 19% and Net Profitability from Continuing Operations of $0.04 Per Fully Diluted Share for the Quarter
FORT
WORTH, TX, May
First Quarter 2026 Financial Summary(1)
| ● | Net revenue increased 19% to $27.8 million, compared to $23.4 million in the first quarter of 2025. | |
| ● | Gross profit of $25.9 million, or 93% of net revenue, compared to gross profit of $21.6 million, or 92% of net revenue, in the first quarter of 2025. | |
| ● | Operating income of $2.6 million, compared to operating income of $0.8 million in the first quarter of 2025. | |
| ● | Net income from continuing operations of $0.4 million, or $0.04 per diluted share, compared to net loss from continuing operations of $0.6 million, or $0.07 per diluted share, in the first quarter of 2025. | |
| ● | Adjusted EBITDA(2) of $4.3 million, compared to $2.7 million in the first quarter of 2025. | |
| ● | Cash of $13.6 million and $46.2 million of long-term debt at March 31, 2026, compared to $16.6 million of cash and $46.0 million of long-term debt at December 31, 2025. |
(1) As a result of the Company’s strategic realignment, the operations of Tissue Health Plus (“THP”), which were previously reported as the THP segment, have been classified as discontinued operations in Sanara’s financial statements for the three months ended March 31, 2026 and 2025.
(2) Adjusted EBITDA is a non-GAAP financial measure. See the discussion and the reconciliation at the end of this release for additional information.
Management Comments
Seth
Yon, President and Chief Executive Officer of Sanara, commented, “The first quarter of 2026 is the first full quarter in which
the Company was entirely focused on the surgical
“During
the end of 2025 and continuing into 2026, we began strengthening our sales team in an effort to support enhanced net revenue growth and
our heightened focus on the surgical setting, expanding the sales team to reach a total of 43 reps,” Mr. Yon stated. “Additionally,
we experienced meaningful growth in our surgeon users in the first quarter of 2026 as compared to the first quarter of 2025,
“Looking ahead, we believe we are well positioned with our strengthened sales team and refined, pure play focus on the surgical operating setting to drive enhanced results. From a capital allocation perspective, this means tightening our scope and strategically investing in R&D to grow our pipeline and introduce new products to the market. With our visibility today, we remain confident in our full-year guidance of 13% to 17% net revenue growth,” Mr. Yon concluded.
First Quarter of 2026 Revenue
The following table summarizes revenue streams from product sales for the three months ended March 31, 2026 and 2025:
Three Months Ended March 31, | ||||||||
| 2026 | 2025 | |||||||
| Soft tissue repair products | $ | 24,942,945 | $ | 20,532,440 | ||||
| Bone fusion products | 2,855,589 | 2,901,656 | ||||||
| Total Net Revenue | $ | 27,798,534 | $ | 23,434,096 | ||||
First Quarter of 2026 Financial Results(1)
Net
revenue for the first quarter of 2026 was $27.8 million, compared to $23.4 million for the first quarter of 2025, an increase of $4.4
million, or 19%, year-over-year. The increase in net revenue was driven by an increase of $4.4 million, or 21%, in sales of soft tissue
repair products, offset by a slight decrease of
Gross
profit for the first quarter of 2026 was $25.9 million, compared to $21.6 million for the first quarter of 2025, an increase of $4.3
million, or 20%, year-over-year. Gross margin was 93% of net revenue for the first quarter of 2026, compared to 92% of net revenue for
the first quarter of 2025. The increase in gross profit and higher gross margin realized in the first quarter of 2026 was primarily due
to
Operating
expenses for the first quarter of 2026 were $23.2 million,
Operating income for the first quarter of 2026 was $2.6 million, compared to operating income of $0.8 million for the first quarter of 2025.
Other expense for the first quarter of 2026 was $2.2 million, compared to $1.4 million for the first quarter of 2025. The increase in other expense was primarily due to higher interest expense and fees related to the Company’s term loan with CRG Servicing LLC and the Company’s share of losses from equity method investments.
Net income from continuing operations for the first quarter of 2026 was $0.4 million, or $0.04 per diluted share, compared to a net loss from continuing operations of $0.6 million, or $0.07 per diluted share, for the first quarter of 2025. Net income from discontinued operations for the first quarter of 2026 was $0.1 million, compared to a net loss from discontinued operations of $2.9 million for the first quarter of 2025.
Adjusted EBITDA(2) for the first quarter of 2026 was $4.3 million, compared to $2.7 million for the first quarter of 2025, an increase of $1.6 million, or 58%, year-over-year. Higher Adjusted EBITDA in the first quarter of 2026 was primarily due to net revenue growth offset by increases in SG&A.
Net cash used in operating activities in the first quarter of 2026 was $2.5 million, compared to $2.0 million of net cash used in operating activities in the first quarter of 2025. The increase in cash used in operating activities during the first quarter of 2026 was primarily due to the timing of commissions payments, higher cash interest expense resulting from a larger outstanding debt balance compared to the prior-year period and the absence of paid-in-kind interest.
As of March 31, 2026, the Company had $13.6 million of cash and $46.2 million of long-term debt, compared to $16.6 million and $46.0 million, respectively, as of December 31, 2025.
(1) As a result of the Company’s strategic realignment, the operations of THP, which were previously reported as the THP segment, have been classified as discontinued operations in Sanara’s financial statements for the three months ended March 31, 2026 and 2025.
(2) Adjusted EBITDA is a non-GAAP financial measure. See the discussion and the reconciliation at the end of this release for additional information.
The Company is reaffirming financial guidance for the full year ending December 31, 2026.
Sanara continues to expect full year 2026 net revenue to range from $116 million to $121 million, representing growth of approximately 13% to 17%, compared to net revenue of $103.1 million for the full year 2025.
Conference Call
The Company will host a conference call on Tuesday, May 12, 2026 at 8:00 a.m. Eastern Time to discuss the results of the quarter ended March 31, 2026 and hold a question and answer session at the end of the call. The toll-free number to call for this teleconference is 888-506-0062 (international callers: 973-528-0011) and the access code is 931324. A telephonic replay of the conference call will be available through Tuesday, May 26, 2026, by dialing 877-481-4010 (international callers: 919-882-2331) and entering the replay passcode: 53818.
A live webcast of Sanara’s conference call is accessible by clicking here and will be made available under the “Events” section of the Company’s Investor Relations website, https://ir.sanaramedtech.com/. An online replay will be available for approximately one year following the conclusion of the live broadcast.
About Sanara MedTech Inc.
Sanara MedTech Inc. is a medical technology company focused on developing and commercializing transformative technologies to improve clinical outcomes and reduce healthcare expenditures in the surgical market. The Company develops, markets and distributes surgical products for use by physicians and clinicians in hospitals. Each of the Company’s products and technologies are designed to achieve the goal of providing better clinical outcomes at a lower overall cost for healthcare systems. Sanara’s products are primarily sold in the North American surgical tissue repair market. Sanara markets and distributes CellerateRX® Surgical Activated Collagen Powder, BIASURGE® Advanced Surgical Solution, FORTIFY TRG® Tissue Repair Graft and FORTIFY FLOWABLE® Extracellular Matrix, as well as a portfolio of advanced biologic products including: ACTIGEN® Verified Inductive Bone Matrix, ALLOCYTE® Plus Advanced Viable Bone Matrix, BiFORM® Bioactive Moldable Matrix and TEXAGEN® Amniotic Membrane Allograft to the surgical market. The Company believes it can drive its pipeline from concept to preclinical and clinical development while meeting quality and regulatory requirements. The Company strives to be one of the most innovative and comprehensive providers of effective surgical solutions and is continually seeking to expand its offerings for patients requiring treatments in the United States. For more information, please visit SanaraMedTech.com.
Information about Forward-Looking Statements
The statements in this press release that do not constitute historical facts are “forward-looking statements,” within the meaning of and subject to the safe harbor created by the Private Securities Litigation Reform Act of 1995. These statements may be identified by terms such as “aims,” “anticipates,” “believes,” contemplates,” “continue,” “could,” “estimates,” “expects,” “forecast,” “guidance,” “intends,” “may,” “plans,” “possible,” “potential,” “predicts,” “preliminary,” “projects,” “seeks,” “should,” “targets,” “will” or “would,” or the negatives of these terms, variations of these terms or other similar expressions. These forward-looking statements include, among others, statements regarding the Company’s expected net revenue, the Company’s ability to achieve enhanced results by focusing on the surgical market, the Company’s business strategy and mission, the development of new products, the timing of commercialization of the Company’s products, and the regulatory approval process. These items involve risks, contingencies and uncertainties such as uncertainties associated with the development and process for obtaining regulatory approval for new products, the extent of product demand, market and customer acceptance, the effect of economic conditions, competition, pricing, uncertainties associated with the development and process for obtaining regulatory approval for new products, the ability to consummate and integrate acquisitions, and other risks, contingencies and uncertainties detailed in the Company’s most recent annual report on Form 10-K and subsequent reports filed with the Securities and Exchange Commission, which could cause the Company’s actual operating results, performance or business plans or prospects to differ materially from those expressed in or implied by these statements.
All forward-looking statements speak only as of the date on which they are made, and the Company undertakes no obligation to revise any of these statements to reflect future circumstances or the occurrence of unanticipated events, except as required by applicable securities laws.
Investor Relations Contact:
Walter Frank or John Nesbett
IMS Investor Relations
IR@sanaramedtech.com
(203) 972-9200
SANARA MEDTECH INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
| March 31, 2026 | December 31, 2025 | |||||||
| (Unaudited) | ||||||||
| Assets | ||||||||
| Current assets | ||||||||
| Cash | $ | 13,594,459 | $ | 16,578,857 | ||||
| Accounts receivable, net | 13,617,407 | 11,998,075 | ||||||
| Inventory, net | 3,120,795 | 3,948,748 | ||||||
| Prepaid and other assets | 816,788 | 948,620 | ||||||
| Current assets related to discontinued operations | 48,533 | 67,863 | ||||||
| Total current assets | 31,197,982 | 33,542,163 | ||||||
| Long-term assets | ||||||||
| Intangible assets, net | 17,860,273 | 18,640,673 | ||||||
| Goodwill | 3,601,781 | 3,601,781 | ||||||
| Investment in equity securities | 14,164,351 | 14,626,858 | ||||||
| Right of use assets – operating leases | 1,993,850 | 2,075,634 | ||||||
| Property and equipment, net | 458,880 | 456,962 | ||||||
| Total long-term assets | 38,079,135 | 39,401,908 | ||||||
| Total assets | $ | 69,277,117 | $ | 72,944,071 | ||||
| Liabilities and shareholders’ equity | ||||||||
| Current liabilities | ||||||||
| Accounts payable | $ | 905,396 | $ | 2,338,761 | ||||
| Accounts payable – related parties | 15,847 | - | ||||||
| Accrued bonuses and commissions | 9,082,596 | 11,781,435 | ||||||
| Accrued royalties and expenses | 2,615,798 | 2,684,626 | ||||||
| Earnout liabilities – current | - | 235,001 | ||||||
| Operating lease liabilities – current | 367,945 | 353,229 | ||||||
| Current liabilities related to discontinued operations | 713,260 | 1,233,478 | ||||||
| Total current liabilities | 13,700,842 | 18,626,530 | ||||||
| Long-term liabilities | ||||||||
| Long-term debt | 46,226,422 | 45,970,937 | ||||||
| Operating lease liabilities – long-term | 1,770,756 | 1,868,703 | ||||||
| Other long-term liabilities | 559,602 | 548,125 | ||||||
| Total long-term liabilities | 48,556,780 | 48,387,765 | ||||||
| Total liabilities | 62,257,622 | 67,014,295 | ||||||
| Commitments and contingencies | ||||||||
| Shareholders’ equity | ||||||||
| Common Stock: $0.001 par value, 20,000,000 shares authorized; 9,165,148 issued and outstanding as of March 31, 2026 and 8,946,913 issued and outstanding as of December 31, 2025 | 9,166 | 8,948 | ||||||
| Additional paid-in capital | 81,522,244 | 81,232,536 | ||||||
| Accumulated deficit | (74,502,895 | ) | (75,303,042 | ) | ||||
| Total Sanara MedTech shareholders’ equity | 7,028,515 | 5,938,442 | ||||||
| Equity attributable to noncontrolling interest | (9,020 | ) | (8,666 | ) | ||||
| Total shareholders’ equity | 7,019,495 | 5,929,776 | ||||||
| Total liabilities and shareholders’ equity | $ | 69,277,117 | $ | 72,944,071 | ||||
SANARA MEDTECH INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
Three Months Ended March 31, | ||||||||
| 2026 | 2025 | |||||||
| Net Revenue | $ | 27,798,534 | $ | 23,434,096 | ||||
| Cost of goods sold | 1,923,589 | 1,834,967 | ||||||
| Gross profit | 25,874,945 | 21,599,129 | ||||||
| Operating expenses | ||||||||
| Selling, general and administrative | 21,881,520 | 19,129,208 | ||||||
| Research and development | 759,592 | 950,359 | ||||||
| Depreciation and amortization | 587,252 | 694,032 | ||||||
| Total operating expenses | 23,228,364 | 20,773,599 | ||||||
| Operating income | 2,646,581 | 825,530 | ||||||
| Other income (expense) | ||||||||
| Interest expense | (1,799,345 | ) | (1,317,092 | ) | ||||
| Share of losses from equity method investments | (462,507 | ) | (143,608 | ) | ||||
| Interest income | 12,958 | 3,672 | ||||||
| Gain on disposal of property and equipment | - | 10,932 | ||||||
| Total other income (expense) | (2,248,894 | ) | (1,446,096 | ) | ||||
| Net income (loss) from continuing operations | 397,687 | (620,566 | ) | |||||
| Net income (loss) from discontinued operations | 60,916 | (2,906,817 | ) | |||||
| Net income (loss) | 458,603 | (3,527,383 | ) | |||||
| Less: Net loss attributable to noncontrolling interest from continuing operations | (354 | ) | (206 | ) | ||||
| Net income (loss) attributable to Sanara MedTech shareholders | $ | 458,957 | $ | (3,527,177 | ) | |||
| Net income (loss) per share, basic: | ||||||||
| Continuing operations | $ | 0.04 | $ | (0.07 | ) | |||
| Discontinued operations | 0.01 | (0.34 | ) | |||||
| Net income (loss) per share of common stock, basic | $ | 0.05 | $ | (0.41 | ) | |||
| Net income (loss) per share, diluted: | ||||||||
| Continuing operations | $ | 0.04 | $ | (0.07 | ) | |||
| Discontinued operations | 0.01 | (0.34 | ) | |||||
| Net income (loss) per share of common stock, diluted | $ | 0.05 | $ | (0.41 | ) | |||
| Weighted average number of common shares outstanding, basic | 8,706,678 | 8,570,104 | ||||||
| Weighted average number of common shares outstanding, diluted | 8,985,866 | 8,570,104 | ||||||
The following is a reconciliation of the numerator and denominator of basic and diluted net income (loss) per share for the three months ended March 31, 2026 and 2025:
Three Months Ended March 31, | ||||||||
| 2026 | 2025 | |||||||
| Numerator: | ||||||||
| Net income (loss) from continuing operations | $ | 397,687 | $ | (620,566 | ) | |||
| Net income (loss) from discontinued operations | 60,916 | (2,906,817 | ) | |||||
| Less: Net loss attributable to noncontrolling interests from continuing operations | (354 | ) | (206 | ) | ||||
| Net income (loss) attributable to Sanara MedTech shareholders | $ | 458,957 | $ | (3,527,177 | ) | |||
| Denominator: | ||||||||
| Weighted average shares, basic | 8,706,678 | 8,570,104 | ||||||
| Dilutive effect of stock options | 10,218 | - | ||||||
| Dilutive effect of unvested shares | 268,970 | - | ||||||
| Weighted average shares, diluted | 8,985,866 | 8,570,104 | ||||||
The following table summarizes the shares of common stock that were potentially issuable but were excluded from the computation of diluted net loss per share of common stock for the three months ended March 31, 2025, as such shares would have had an anti-dilutive effect:
| March 31, | ||||
| 2025 | ||||
| Stock options | 31,013 | |||
| Unvested restricted stock | 290,493 | |||
SANARA MEDTECH INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
Three Months Ended March 31, | ||||||||
| 2026 | 2025 | |||||||
| Cash flows from operating activities: | ||||||||
| Net income (loss) | $ | 458,603 | $ | (3,527,383 | ) | |||
| Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||||||||
| Depreciation and amortization | 587,252 | 1,124,410 | ||||||
| Gain on disposal of property and equipment | - | (9,674 | ) | |||||
| Credit loss expense | 75,000 | 179,034 | ||||||
| Inventory obsolescence | 62,800 | 199,278 | ||||||
| Share-based compensation | 1,028,335 | 1,304,904 | ||||||
| Noncash lease expense | 81,784 | 274,055 | ||||||
| Share of losses from equity method investments | 462,507 | 143,608 | ||||||
| Back-end fee | 181,944 | 176,079 | ||||||
| Paid-in-kind interest | - | 411,324 | ||||||
| Accretion of finance liabilities | 27,113 | 43,630 | ||||||
| Amortization and write-off of debt issuance costs | 73,541 | 59,280 | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable, net | (1,709,332 | ) | 368,284 | |||||
| Accounts receivable – related parties | - | (2,254 | ) | |||||
| Inventory, net | 765,153 | (605,628 | ) | |||||
| Prepaid and other assets | 166,162 | 32,759 | ||||||
| Accounts payable | (1,433,365 | ) | 595,836 | |||||
| Accounts payable – related parties | 15,847 | 10,892 | ||||||
| Accrued royalties and expenses | (105,442 | ) | 67,224 | |||||
| Accrued bonuses and commissions | (3,120,078 | ) | (2,566,461 | ) | ||||
| Operating lease liabilities | (83,231 | ) | (278,081 | ) | ||||
| Net cash used in operating activities | (2,465,407 | ) | (1,998,884 | ) | ||||
| Cash flows from investing activities: | ||||||||
| Purchases of property and equipment | (43,772 | ) | (1,722,649 | ) | ||||
| Proceeds from disposal of property and equipment | - | 60,000 | ||||||
| Investment in equity securities | - | (3,517,206 | ) | |||||
| Net cash used in investing activities | (43,772 | ) | (5,179,855 | ) | ||||
| Cash flows from financing activities: | ||||||||
| Loan proceeds, net of debt issuance costs of zero in 2026 and $183,750 in 2025 | - | 12,066,250 | ||||||
| Net settlement of equity-based awards | (397,219 | ) | - | |||||
| Cash payment of finance and earnout liabilities | (78,000 | ) | (78,000 | ) | ||||
| Net cash provided by (used in) financing activities | (475,219 | ) | 11,988,250 | |||||
| Net increase (decrease) in cash | (2,984,398 | ) | 4,809,511 | |||||
| Cash, beginning of period | 16,578,857 | 15,878,295 | ||||||
| Cash, end of period | $ | 13,594,459 | $ | 20,687,806 | ||||
| Cash paid during the period for: | ||||||||
| Interest | $ | 1,516,747 | $ | 626,779 | ||||
| Taxes | 143 | 52,984 | ||||||
| Supplemental noncash investing and financing activities: | ||||||||
| Non-monetary exchange to acquire intangible assets | $ | - | $ | 2,084,278 | ||||
| Conversion of note receivable into equity method investment | - | 1,101,478 | ||||||
SANARA MEDTECH INC. AND SUBSIDIARIES
NON-GAAP FINANCIAL MEASURES (UNAUDITED)
To supplement the Company’s financial information presented in accordance with generally accepted accounting principles in the United States (“GAAP”), we present certain non-GAAP financial measures in this press release and on the related teleconference call, including Adjusted EBITDA. The Company’s management uses these non-GAAP financial measures, both internally and externally, to assess and communicate the financial performance of the Company. The Company defines Adjusted EBITDA as net income (loss) from continuing operations excluding interest expense/income, provision/benefit for income taxes, depreciation and amortization, non-cash share-based compensation expense, change in fair value of earnout liabilities, asset impairment charges, share of losses from equity method investments, gains/losses on the disposal of property and equipment, executive separation costs, and legal and diligence expenses related to acquisitions, as each is applicable to the periods presented.
The Company believes Adjusted EBITDA is useful to investors because it facilitates comparisons of the Company’s core business operations across periods on a consistent basis. Accordingly, the Company adjusts certain items when calculating Adjusted EBITDA because the Company believes that such items are not related to the Company’s core business operations.
The Company’s non-GAAP financial measures are not in accordance with, nor an alternative for, measures conforming to GAAP and may be different from non-GAAP financial measures used by other companies. In addition, these non-GAAP financial measures are not based on any comprehensive set of accounting rules or principles. The Company continues to provide all information required by GAAP, but it believes that evaluating its ongoing operating results may not be as useful if an investor or other user is limited to reviewing only GAAP financial measures. The Company does not, nor does it suggest that investors should, consider these non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Material limitations associated with the use of such measures include that they do not reflect all costs included in operating expenses and may not be comparable with similarly named financial measures of other companies. Furthermore, these non-GAAP financial measures are based on subjective determinations of management regarding the nature and classification of events and circumstances. The Company presents these non-GAAP financial measures to provide investors with information to evaluate the Company’s operating results in a manner similar to how management evaluates business performance. To compensate for any limitations in such non-GAAP financial measures, management believes that it is useful in understanding and analyzing the results of the business to review both GAAP information and the related non-GAAP financial measures. Whenever the Company uses a non-GAAP financial measure, it provides a reconciliation of the non-GAAP financial measure to the most directly comparable GAAP financial measure. Investors are encouraged to review and consider these reconciliations.
Reconciliation of Net income (loss) from continuing operations to Adjusted EBITDA:
Three Months Ended March 31, | ||||||||
| 2026 | 2025 | |||||||
| Net income (loss) from continuing operations | $ | 397,687 | $ | (620,566 | ) | |||
| Adjustments: | ||||||||
| Interest expense | 1,799,345 | 1,317,092 | ||||||
| Depreciation and amortization(1) | 587,252 | 694,032 | ||||||
| Noncash share-based compensation | 1,028,335 | 1,175,496 | ||||||
| Share of losses from equity method investments | 462,507 | 143,608 | ||||||
| Gain on disposal of property and equipment | - | (10,932 | ) | |||||
| Interest income | (12,958 | ) | (3,672 | ) | ||||
| Adjusted EBITDA | $ | 4,262,168 | $ | 2,695,058 | ||||
| (1) | Depreciation expense of $5,461 was reclassified as continuing operations in the three months ended March 31, 2025 and is therefore no longer reflected in discontinued operations. |
ANNEX - Consolidated (reflecting our Surgical Business):
The following tables reflect results of operations of our surgical business for the periods indicated below (Unaudited except for full fiscal years ended December 31, 2025, 2024, and 2023):
| 2025 | 2024 | 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Q1 | Q2 | Q3 | Q4 | TOTAL | Q1 | Q2 | Q3 | Q4 | TOTAL | Q1 | Q2 | Q3 | Q4 | TOTAL | ||||||||||||||||||||||||||||||||||||||||||||||
| Net Revenue | $ | 23,434,096 | $ | 25,804,252 | $ | 26,333,819 | $ | 27,545,815 | $ | 103,117,982 | $ | 18,536,638 | $ | 20,158,823 | $ | 21,671,599 | $ | 26,305,365 | $ | 86,672,425 | $ | 15,519,187 | $ | 15,753,164 | $ | 16,024,948 | $ | 17,689,813 | $ | 64,987,112 | ||||||||||||||||||||||||||||||
| Cost of goods sold | 1,834,967 | 1,937,282 | 1,874,214 | 1,874,506 | 7,520,969 | 1,890,046 | 2,008,686 | 1,991,987 | 2,249,182 | 8,139,901 | 2,116,694 | 2,187,516 | 1,751,349 | 1,788,162 | 7,843,721 | |||||||||||||||||||||||||||||||||||||||||||||
| Gross profit | 21,599,129 | 23,866,970 | 24,459,605 | 25,671,309 | 95,597,013 | 16,646,592 | 18,150,137 | 19,679,612 | 24,056,183 | 78,532,524 | 13,402,493 | 13,565,648 | 14,273,599 | 15,901,651 | 57,143,391 | |||||||||||||||||||||||||||||||||||||||||||||
| Operating expenses | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Selling, general and administrative(1) | 19,129,208 | 19,634,319 | 19,877,875 | 20,075,597 | 78,716,999 | 15,683,039 | 18,349,924 | 17,420,347 | 20,220,332 | 71,673,642 | 12,467,395 | 13,301,230 | 13,460,404 | 15,597,823 | 54,826,852 | |||||||||||||||||||||||||||||||||||||||||||||
| Research and development | 950,359 | 1,056,796 | 1,029,591 | 2,035,737 | 5,072,483 | 578,981 | 582,443 | 783,840 | 883,399 | 2,828,663 | 235,236 | 208,727 | 225,886 | 232,933 | 902,782 | |||||||||||||||||||||||||||||||||||||||||||||
| Depreciation and amortization(2) | 694,032 | 688,546 | 610,899 | 668,396 | 2,661,873 | 698,502 | 698,407 | 696,888 | 692,032 | 2,785,829 | 372,020 | 396,597 | 590,563 | 687,679 | 2,046,859 | |||||||||||||||||||||||||||||||||||||||||||||
| Change in fair value of earnout liabilities | - | - | - | - | - | (103,781 | ) | 89,330 | - | - | (14,451 | ) | (191,127 | ) | (436,004 | ) | (758,783 | ) | 87,578 | (1,298,336 | ) | |||||||||||||||||||||||||||||||||||||||
| Asset impairment charges | - | - | - | 1,841,120 | 1,841,120 | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
| Total operating expenses | 20,773,599 | 21,379,661 | 21,518,365 | 24,620,850 | 88,292,475 | 16,856,741 | 19,720,104 | 18,901,075 | 21,795,763 | 77,273,683 | 12,883,524 | 13,470,550 | 13,518,070 | 16,606,013 | 56,478,157 | |||||||||||||||||||||||||||||||||||||||||||||
| Operating income (loss) | 825,530 | 2,487,309 | 2,941,240 | 1,050,459 | 7,304,538 | (210,149 | ) | (1,569,967 | ) | 778,537 | 2,260,420 | 1,258,841 | 518,969 | 95,098 | 755,529 | (704,362 | ) | 665,234 | ||||||||||||||||||||||||||||||||||||||||||
| Other income (expense) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Interest expense | (1,317,092 | ) | (1,791,568 | ) | (1,818,105 | ) | (1,833,035 | ) | (6,759,800 | ) | (267,336 | ) | (644,346 | ) | (927,577 | ) | (1,289,136 | ) | (3,128,395 | ) | (6 | ) | - | (188,294 | ) | (287,483 | ) | (475,783 | ) | |||||||||||||||||||||||||||||||
| Share of losses from equity method investments | (143,608 | ) | (195,482 | ) | (288,642 | ) | (324,734 | ) | (952,466 | ) | - | - | (31,448 | ) | (58,559 | ) | (90,007 | ) | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
| Interest income | 3,672 | - | - | - | 3,672 | - | - | - | 21,978 | 21,978 | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
| Gain on disposal of property and equipment | 10,932 | - | - | - | 10,932 | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
| Gain on disposal of investment | - | - | - | - | - | - | - | - | - | - | - | - | - | 251,034 | 251,034 | |||||||||||||||||||||||||||||||||||||||||||||
| Total other income (expense) | (1,446,096 | ) | (1,987,050 | ) | (2,106,747 | ) | (2,157,769 | ) | (7,697,662 | ) | (267,336 | ) | (644,346 | ) | (959,025 | ) | (1,325,717 | ) | (3,196,424 | ) | (6 | ) | - | (188,294 | ) | (36,449 | ) | (224,749 | ) | |||||||||||||||||||||||||||||||
| Net income (loss) from continuing operations | $ | (620,566 | ) | $ | 500,259 | $ | 834,493 | $ | (1,107,310 | ) | $ | (393,124 | ) | $ | (477,485 | ) | $ | (2,214,313 | ) | $ | (180,488 | ) | $ | 934,703 | $ | (1,937,583 | ) | $ | 518,963 | $ | 95,098 | $ | 567,235 | $ | (740,811 | ) | $ | 440,485 | ||||||||||||||||||||||
| (1) | Selling, general and administrative expense of $90,293 was reclassified and is now reflected as discontinued operations in the first quarter of 2024. | |
| (2) | Depreciation expense of $5,461 and $7,021 was reclassified as continuing operations in the first and second quarters of 2025, respectively, and is therefore no longer reflected in discontinued operations. |
ANNEX - Consolidated (reflecting our Surgical Business) (continued):
Reconciliation of Net income (loss) from continuing operations to Adjusted EBITDA (Unaudited):
| 2025 | 2024 | 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Q1 | Q2 | Q3 | Q4 | TOTAL | Q1 | Q2 | Q3 | Q4 | TOTAL | Q1 | Q2 | Q3 | Q4 | TOTAL | ||||||||||||||||||||||||||||||||||||||||||||||
| Net income (loss) from continuing operations | $ | (620,566 | ) | $ | 500,259 | $ | 834,493 | $ | (1,107,310 | ) | $ | (393,124 | ) | $ | (477,485 | ) | $ | (2,214,313 | ) | $ | (180,488 | ) | $ | 934,703 | $ | (1,937,583 | ) | $ | 518,963 | $ | 95,098 | $ | 567,235 | $ | (740,811 | ) | $ | 440,485 | ||||||||||||||||||||||
| Adjustments: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Interest expense | 1,317,092 | 1,791,568 | 1,818,105 | 1,833,035 | 6,759,800 | 267,336 | 644,346 | 927,577 | 1,289,136 | 3,128,395 | 6 | - | 188,294 | 287,483 | 475,783 | |||||||||||||||||||||||||||||||||||||||||||||
| Depreciation and amortization(1) | 694,032 | 688,546 | 610,899 | 668,396 | 2,661,873 | 698,502 | 698,407 | 696,888 | 692,032 | 2,785,829 | 372,020 | 396,597 | 590,563 | 687,679 | 2,046,859 | |||||||||||||||||||||||||||||||||||||||||||||
| Noncash share-based compensation | 1,175,496 | 1,278,871 | 1,164,070 | 1,155,545 | 4,773,982 | 753,616 | 1,046,321 | 1,003,599 | 1,165,472 | 3,969,008 | 545,214 | 1,064,516 | 813,606 | 777,994 | 3,201,330 | |||||||||||||||||||||||||||||||||||||||||||||
| Change in fair value of earnout liabilities | - | - | - | - | - | (103,781 | ) | 89,330 | - | - | (14,451 | ) | (191,127 | ) | (436,004 | ) | (758,783 | ) | 87,578 | (1,298,336 | ) | |||||||||||||||||||||||||||||||||||||||
| Asset impairment charges | - | - | - | 1,841,120 | 1,841,120 | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
| Share of losses from equity method investments | 143,608 | 195,482 | 288,642 | 324,734 | 952,466 | - | - | 31,448 | 58,559 | 90,007 | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
| Gain on disposal of property and equipment | (10,932 | ) | - | - | - | (10,932 | ) | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||
| Interest income | (3,672 | ) | - | - | - | (3,672 | ) | - | - | - | (21,978 | ) | (21,978 | ) | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||
| Executive separation costs(2) | - | 260,275 | 172,048 | - | 432,323 | - | 904,781 | 59,685 | - | 964,466 | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||
| Acquisition costs (3) | - | 4,826 | 20,000 | (24,826 | ) | - | - | 225,089 | 24,812 | (64,872 | ) | 185,029 | - | - | - | 423,513 | 423,513 | |||||||||||||||||||||||||||||||||||||||||||
| Adjusted EBITDA | $ | 2,695,058 | $ | 4,719,827 | $ | 4,908,257 | $ | 4,690,694 | $ | 17,013,836 | $ | 1,138,188 | $ | 1,393,961 | $ | 2,563,521 | $ | 4,053,052 | $ | 9,148,722 | $ | 1,245,076 | $ | 1,120,207 | $ | 1,400,915 | $ | 1,523,436 | $ | 5,289,634 | ||||||||||||||||||||||||||||||
| (1) | Depreciation expense of $5,461 and $7,021 was reclassified as continuing operations in the first and second quarters of 2025, respectively, and is therefore no longer reflected in discontinued operations. | |
| (2) | Includes share-based compensation related to executive separation costs. | |
| (3) | Acquisition costs include legal, tax, accounting and other contract services related to prospective acquisitions. |