0001645113-26-000042
SEC filingRevenue up 12% to $174.1M; gross margin expanded 300bps to 78%; net loss widened on $43.4M non-cash PSU expense.
For Q1 2026, NovoCure reported net revenues of $174.1M, up 12% from $155.0M in Q1 2025. Growth was led by international markets (+$16.3M), particularly Germany (+$5.8M from active patient growth and reimbursement improvements), France (+$5.0M from continued growth), and other international markets (+$3.7M including the Optune Gio launch in Spain). One-time revenue benefits of $2.5M in Germany and $1.0M in France contributed, along with $5.6M in favorable exchange rates. US revenue grew $2.8M driven by active patient growth in Optune Gio and Optune Lua.
Gross margin expanded 300 basis points to 78% from 75%, as 12% active patient growth was achieved with only a 1% increase in cost of revenues. Lower array costs from improved utilization and supplier pricing offset higher patient volumes. Operating loss widened to $67.4M from $37.9M, driven by a 92% increase in G&A expenses to $85.9M, primarily due to a $43.4M non-cash stock compensation expense from performance stock units (PSUs) granted in 2020 that were expensed upon FDA approval of Optune Pax. Excluding this, operating expenses increased modestly. Net loss was $71.1M ($0.62 per share) vs $34.3M ($0.31 per share) in the prior year.
Adjusted EBITDA improved to a loss of $0.3M from a loss of $5.0M, reflecting revenue growth partially offset by costs for new indication launches.
While NovoCure operates as a single segment, geographic and product trends are notable. Active patients reached 4,791 at quarter end, up 12% from 4,268 a year ago. US patients grew to 2,439 from 2,231, driven by Optune Gio (2,250 vs 2,157) and Optune Lua (106 vs 74). Optune Pax launched in the US with 83 patients and 169 prescriptions received during the quarter. International patients grew to 2,352 from 2,037, led by Germany (688 vs 573), France (505 vs 463), and Japan (541 vs 445). Optune Lua contributed 165 patients globally vs 106, reflecting progress in the NSCLC indication.
Revenue mix continues to shift toward international markets, which contributed the majority of growth. Optune Lua revenue doubled to $3.0M from $1.5M, still recognized on a cash basis due to insufficient claims history for accrual.
Management expects gross margins to remain under pressure from new indication launches (NSCLC, pancreatic) and the evolving tariff landscape, though short-term impact is deemed immaterial. The company is actively mitigating medium-term risks by adding production capacity in Mexico and Ireland and pursuing refunds of tariffs paid under IEEPA. Operating expenses are expected to increase as the company scales launches for Optune Lua in Japan and Optune Pax globally. The LUNAR-2 trial (NSCLC) design is under review to compress timeline and reduce costs. Cash, cash equivalents, and short-term investments totaled $432.0M, sufficient for at least 12 months. The company may need additional capital in the longer term if operating losses persist.
As of March 31, 2026, the company holds $432.0M in cash, cash equivalents, and short-term investments, with $9.8M in restricted cash. Total debt under the senior secured credit facility is $200.0M principal ($195.5M net of issuance costs). Shareholders' equity stands at $330.7M. Inventories total $43.5M, up 5.7% from year-end. Deferred revenue is $15.9M, stable sequentially.
No significant purchase commitments are disclosed beyond operating leases. Pledged deposits of $5.8M and bank guarantees of $6.2M support lease obligations. The facility leases extend through 2044. No off-balance-sheet arrangements or material supply agreements are noted.
No share buybacks or dividends are disclosed. The company did not draw additional tranches under the credit facility; the Tranche C and D options were not exercised. Capital expenditures of $5.2M in Q1 2026 (from cash flow) are not broken out in the notes but are implied from investing activities. Share-based compensation totaled $63.0M, including a $43.4M charge for PSU vesting related to FDA approval.
NovoCure operates as a single reportable segment. Revenue by geography (Note 6) shows US $96.0M (55%), Germany $24.5M, France $22.9M, Japan $10.2M, other international $15.7M, and Greater China $4.8M. International markets contributed $73.3M (42% of total), up 28% YoY. Long-lived assets are primarily in the US ($66.3M) and Switzerland ($46.6M).
In Q1 2026, NovoCure's net loss was $71.1M, while operating cash flow was -$13.5M. The difference is primarily due to non-cash charges: share-based compensation ($63.0M) and depreciation ($4.1M) offset by working capital outflows (e.g., accounts payable decrease of $5.1M and inventory increase of $2.8M). Capex of $5.2M represents a moderate intensity relative to operating cash flow. Free cash flow (not explicitly stated) would be approximately -$18.7M (CFO minus capex), but no FCF is reported. There were no share repurchases or dividends. The company's cash outflow from operations narrowed significantly from -$35.7M in Q1 2025, driven by improved net income adjustments and lower working capital drag. Investing activities provided $7.7M net, mainly from short-term investment maturities. Financing activities used $0.2M. Overall, cash generation remains negative but on a improving trajectory.