0001753926-26-000435
SEC filingSensus Healthcare reported a net loss of $7.7 million for FY 2025, a significant decline from a net income of $6.6 million in FY 2024. Revenue decreased 34% to $27.5 million, primarily due to a lower number of units sold (70 vs. 115) and reduced sales to its largest customer. Gross profit fell 51% to $11.9 million, with gross margin contracting from 58.4% to 43.3% due to higher servicing costs and expenses from new placements under the Fair Deal Agreement. Operating expenses increased 36% to $22.2 million, driven by higher research and development costs (up 86% to $7.8 million) for lobbying activities and product development. The company generated positive operating cash flow of $0.5 million and ended the year with $22.1 million in cash. Management expects lower R&D expenses in 2026 and anticipates increased demand from new CMS reimbursement codes effective January 1, 2026.
Sensus Healthcare reported disappointing financial results for FY 2025, with revenue declining 34% to $27.5 million from $41.8 million in FY 2024. The company swung to a net loss of $7.7 million compared to net income of $6.6 million in the prior year. This performance reversal was primarily driven by reduced sales volume (70 units sold vs. 115) and decreased demand from the company's historically largest customer. Operating loss was $10.3 million compared to operating income of $8.1 million in FY 2024. Despite the net loss, the company generated positive operating cash flow of $0.5 million and maintained a strong cash position of $22.1 million at year-end.
The revenue decline was concentrated in product sales, which decreased from $36.6 million to $21.5 million. Service revenue showed modest growth, increasing from $5.2 million to $6.0 million. Geographically, U.S. revenue accounted for 92% of total revenue ($25.4 million), while China contributed 7% ($2.0 million). The company noted that revenue from new placements under the Fair Deal Agreement partially offset the decline in traditional equipment sales. Customer concentration remained high, with one U.S. customer accounting for 52% of total revenue and 65% of accounts receivable.
Gross margin contracted significantly from 58.4% to 43.3%, representing a 1,510 basis point decline. This deterioration resulted from higher costs of servicing systems and expenses associated with new placements under the Fair Deal Agreement, which generates installation and training costs in advance of related revenues. Operating expenses increased 36% to $22.2 million, with the most substantial increase in research and development (up 86% to $7.8 million) due to lobbying costs for billing code reimbursement and product development. Selling and marketing expenses rose 30% to $6.5 million due to increased tradeshow costs and headcount.
The company generated $0.5 million in operating cash flow despite the net loss, primarily due to a $13.6 million decrease in accounts receivable. Free cash flow was $0.3 million after accounting for $0.2 million in capital expenditures. The balance sheet shows total assets of $53.0 million, with current assets of $45.9 million including $22.1 million in cash, $6.0 million in accounts receivable, and $14.6 million in inventories. Total liabilities were modest at $4.9 million, resulting in stockholders' equity of $48.1 million. The company had no debt outstanding under its $15 million revolving credit facility but was in technical default for failing to meet the minimum profitability covenant.
Management expects research and development expenses to be substantially lower in 2026 compared to 2025. The company anticipates that new CMS reimbursement codes effective January 1, 2026, will increase demand for SRT products. However, management identified several uncertainties for 2026, including potential further decreased demand from its largest customer, increased costs from hiring more sales representatives, continued inflation, and decreased demand for higher-priced SRT devices. The company aims to return to profitability in 2026 through increased sales and managed operational expenses while continuing to invest in marketing initiatives.