0001588978-26-000022
SEC filingRevenue grew 20.2% to $83.1M, driven by system placements and handpiece utilization, though operating losses widened as the company invested in commercialization and R&D.
Revenue for the first quarter of 2026 was $83.1 million, a 20.2% increase from $69.2 million in the same period last year. This growth was driven by continued adoption of our robotic-assisted surgical platform, with increases in both system placements and handpiece utilization. The expansion of our commercialization activities resulted in higher accounts receivable, inventory, and accounts payable, reflecting the scaling of operations to support revenue growth.
Gross margin improved to 64.9% from 63.9% in the prior year, driven by fixed-cost absorption as production volumes increased and by higher average selling prices on both systems and handpieces. Management expects long-term margin expansion as volume growth continues to spread manufacturing overhead over more units, though quarterly fluctuations may occur due to geographic mix and product mix.
Operating loss increased to $32.6 million from $27.4 million, as the company invested aggressively in sales and marketing, operations, and research and development. R&D expenses rose primarily due to employee-related costs, including salaries and stock-based compensation. The increase in operating expenses reflects our commitment to expanding our commercial footprint and advancing our product pipeline.
Net cash used in operating activities was $38.1 million, compared to $17.0 million in the prior year, driven by higher operating losses and working capital investments. Capital expenditures were $2.9 million, resulting in free cash flow of -$41.0 million. The decrease in interest income was due to lower cash balances, while interest expense decreased due to a lower interest rate compared to the prior period.
Management expects revenue to increase in absolute dollars as it drives system placements and utilization, though cost of sales will also rise with revenue growth. Gross margin is expected to improve over the long term through volume-driven fixed-cost leverage and purchasing efficiencies. The company plans to maintain its valuation allowance on U.S. deferred tax assets until it becomes more likely than not that future taxable income will realize those benefits. Key risks include the pace of market adoption, reimbursement dynamics, and the ability to scale manufacturing efficiently.