0001645113-25-000029
SEC filingRevenue grew 6% to $158.8M, but net loss widened to $40.1M due to higher costs and tariffs.
NovoCure reported net revenues of $158.8 million for the three months ended June 30, 2025, a 6% increase from $150.4 million in the same period last year. The growth was primarily driven by strong performance in international markets, particularly France ($4.2 million increase) and Germany ($4.0 million increase), partially offset by a $1.5 million decline in U.S. revenue due to reduced one-time benefits and a $1.3 million decrease in Greater China revenue. Optune Lua contributed $2.4 million in revenue, with $1.1 million from NSCLC and $1.3 million from MPM.
Gross profit increased slightly to $117.3 million from $115.7 million, but gross margin contracted to 73.9% from 77.0% as cost of revenues rose 20% to $41.5 million, driven by a 9% increase in active patients, higher array costs from a new array roll-out, the NSCLC launch, and increased tariffs. Operating expenses rose 5% to $156.9 million, led by a 17% increase in general and administrative expenses (partly due to a $2.3 million one-time production line retirement cost) and a 2% increase in R&D expenses as clinical trials ramped up. Share-based compensation declined overall but increased in G&A. Net loss widened to $40.1 million from $33.4 million, and Adjusted EBITDA turned negative at -$9.9 million versus positive $1.1 million.
Geographically, the U.S. saw a decline in revenue due to a reduction in one-time prior-period claim benefits, while international markets continued to expand. France and Germany benefited from active patient growth and reimbursement improvements. Optune Lua adoption accelerated significantly: active patients on Optune Lua grew to 137 from 26 a year ago, with prescriptions received rising to 143 in Q2 2025 from 26 in Q2 2024. The NSCLC launch is gaining traction, though revenue recognition for NSCLC claims remains tied to cash collection until sufficient claims history is established. The MPM indication also contributed modestly with 43 active patients worldwide.
Management expects gross margins to remain under pressure from product enhancements (e.g., new arrays) and the evolving tariff landscape. They estimate import duties could increase by up to $7 million in 2025 if tariffs return to pre-pause rates. To mitigate, they are diversifying supply sources and adding production capacity in Mexico and Ireland. Operationally, the company plans to file the PANOVA-3 PMA application in Q3 2025 and complete the METIS submission by end of 2025, expanding into pancreatic cancer and brain metastases from NSCLC. Operating expenses are expected to rise as they prepare for these new indications and continue to invest in the NSCLC launch. With $911.5 million in cash and equivalents, NovoCure believes it is adequately funded for at least the next 12 months, though future profitability remains dependent on revenue growth outpacing cost increases.
As of June 30, 2025, NovoCure reported cash and cash equivalents of $149.6M and short-term investments of $761.9M, totaling $911.5M in highly liquid assets. This compares to total debt of $657.4M ($559.8M convertible notes plus $97.6M senior secured credit facility). The company's net cash position is $254.1M. Inventory increased to $40.2M from $35.1M at year-end 2024, driven by higher finished product levels. Deferred revenue (short-term contract liabilities) was $15.4M, up slightly from $14.2M.
The notes disclose operating lease commitments ending no later than 2044, but no dollar amounts are provided in the notes themselves. Pledged deposits of $5.1M secure bank guarantees for leases. The convertible notes (0% coupon) mature November 1, 2025, with holders able to convert beginning August 2025. The $100M Tranche A of the senior secured facility bears interest at 6.25% plus 3-month SOFR (floor 3.25%) and requires quarterly interest payments. The Tranche B loan ($100M) was noticed for draw in September 2025. No other purchase commitments are disclosed in the notes.
No share buybacks or dividends are reported. Debt management includes the convertible notes (net carrying $559.8M) and the credit facility ($97.6M net). Interest expense for H1 2025 was $5.3M on the credit facility, with amortization of debt issuance costs of $0.3M. The company redeemed $14.1M of convertible notes in 2024 at a discount, generating a gain. Capital expenditures are not detailed in the notes beyond the cash flow statement, but the notes reference purchase of property and equipment in non-cash activities.
NovoCure operates as a single reportable segment. Revenue by geography (Note 6) shows U.S. revenue of $187.4M and international markets $117.2M for H1 2025, with Germany, France, and Japan as key contributors. Greater China contributed $9.2M. The company's long-lived assets are concentrated in the U.S. ($65.6M), Switzerland ($49.6M), and Israel ($14.9M).