biote Corp. Q2 FY2026 earnings call

• Overall Financial Results

  • Q2 2026 selling, general, and administrative expenses increased to $32.4 million from $24.2 million year-over-year, driven by elevated legal costs. Most outstanding legal matters have been resolved, so lower quarterly legal expenses are expected going forward.
  • BioT reported a net loss of $7.4 million (23 cents diluted loss per share) in Q2 2026, compared to a net income of $3.9 million (10 cents diluted earnings per share) in Q2 2025. The Q2 2026 net loss included a $0.8 million loss from fair value changes to earn-out liabilities.
  • Adjusted EBITDA decreased to $5.6 million in Q2 2026, with an adjusted EBITDA margin of 12.6%. Operating cash flow was negative $1.2 million for the quarter, and cash and cash equivalents stood at $11.2 million as of June 30, 2026.

• Operational Updates

  • Asteria Health's product supply continuity has been fully restored, and inventory levels are now normalized. In both Q1 2026 and Q2 2026, Asteria supplied approximately 30% of the company's pellets, down from over 50% in Q4 2025.
  • Phase 1 foundational improvements (commercial team restructuring, operational process updates, data and systems upgrades) have been completed. The company is now moving into Phase 2 focused on improving Salesforce productivity and performance.
  • New clinic productivity was slower than expected in Q2 2026 because the sales team redirected focus to supporting clinics impacted by the product recall.
  • Clinic attrition remains at a high single-digit rate of approximately 8%, with no material change from prior periods.

1. Dietary supplements: Revenue grew 5.7% year-over-year to $11.4 million, accounting for approximately 25.7% of total Q2 2026 revenue (total Q2 revenue is ~$44.4 million, calculated as $5.6 million adjusted EBITDA / 12.6% margin).
2. Core procedure business: Experienced year-over-year revenue decline in Q2 2026 driven by the earlier Asteria product recall and associated supply chain disruptions. Gross margin for the overall business was 65.4% in Q2 2026, down from 71.6% year-over-year, due to $0.6 million in incremental recall-related costs, reduced operating efficiency at Asteria Health, and increased sourcing of higher-cost third-party pellets.

• Full-year 2026 total revenue guidance was revised downward to above $175 million, from the prior guidance of above $190 million. Adjusted EBITDA guidance was also revised downward to above $25 million, from the prior guidance of above $38 million.
• Dietary supplements full-year 2026 revenue is still expected to grow at a mid to high single-digit rate compared to 2025, maintaining prior growth projections.
• Procedure revenue is expected to improve sequentially in both the third and fourth quarters of 2026, supported by normalized Asteria supply and renewed sales focus on productivity, but year-over-year procedure revenue is still expected to be negative in both quarters due to lingering first-half recall impacts. This is a downward revision from prior guidance that anticipated a return to year-over-year procedure growth in the second half of 2026.
• Sequential quarter-over-quarter improvement in new clinic productivity is expected in the second half of 2026, which is embedded in the current guidance.

• The product recall earlier in 2026 created ongoing near-term headwinds, including reduced procedure volume, elevated third-party sourcing costs, lower new clinic productivity, and temporary supply chain disruptions that delayed the expected return to year-over-year procedure revenue growth.
• Elevated legal costs increased Q2 2026 SG&A expenses, though management notes most material outstanding legal matters have now been resolved.
• Diverted sales focus from new clinic onboarding and growth to supporting recall-impacted clinics led to slower-than-expected new clinic productivity ramp in Q2 2026.

Q: What is BioT's M&A strategy, and what types of deals does management prefer?

A: Management says it is still early and cannot share specific details, but the company is actively evaluating opportunities that strengthen its existing core platform. Preferred deals will expand BioT's market reach, accelerate its strategic objectives, add complementary capabilities to its core offering, include adjacent products, and enhance practitioner engagement to broaden its footprint in the current space.

Q: Have there been lingering brand or practitioner losses from the Asteria recall, and what will retention efforts look like in H2 2026?

A: The Asteria brand remains strong, and management has not seen significant permanent practitioner loss or pushback to resuming Asteria product use. Clinic attrition is stable at ~8% with no new competitive pressures impacting retention. For H2, management will implement a data-driven, activity-focused strategy: increasing monthly in-person practitioner engagement, which the company has found directly reduces attrition, while also prioritizing same-store sales growth and new customer acquisition. The sales force is already fully built out, so the focus is on improving productivity rather than expanding headcount.

Q: Why is new clinic productivity slower, and does guidance assume H2 productivity improvements?

A: New clinics have not ramped as quickly as expected because the sales team was diverted to supporting recall-impacted clinics to resolve supply issues. Management's guidance does assume sequential quarter-over-quarter productivity improvement in H2 2026, driven by the shift back to a sales focus on new clinic growth as part of the company's Phase 2 Salesforce productivity initiative. This improvement is a core driver of the projected sequential procedure revenue growth in H2.

Q: What gives management confidence that sequential procedure revenue improvement will occur in H2 2026?

A: First, all recall-related supply challenges are now resolved with normalized Asteria inventory, eliminating the core headwind from the first half. Internal data shows that during the supply shortage, the non-Asteria pellet cohort of clinics had steady volume growth, while only the Asteria-dependent cohort declined, so restoring Asteria supply should reverse that volume decline. Management has also completed foundational operational fixes and launched the new activity-focused accountability program for the sales force, which is expected to improve retention and same-store sales performance.