NeuroPace, Inc. Q3 FY2025 earnings call

• Record revenue of $27.4 million in the third quarter, with 30% year-over-year growth, driven by RNS initial implants and broad-based growth across geographies, customers, and programs.
• Achieved positive adjusted EBITDA, a significant milestone, reflecting scalable model and disciplined expense management.
• NAUTILUS PMA supplement development is underway, with plans to submit before year-end 2025.
• Pediatric indication development continues with real-world evidence and protocol alignment, though submission timing for pediatric indication extends beyond 2025.
• The Journal of Clinical Neurophysiology featured RNS, highlighting its role in personalized intracranial neuromodulation.
• R&D pipeline includes seizure iEEG AI software tool to improve clinical outcomes.

Total revenue in the third quarter was $27.4 million. RNS revenue was $22.6 million, representing 31% year-over-year growth, which was the primary driver of revenue growth. RNS contributed approximately 82.5% of total revenue ($22.6M / $27.4M). DIXI sales grew 8%, coming in at approximately $4 million in the quarter. The distribution agreement with DIXI officially ended on September 30, and the company is focusing on its core RNS business.

• Raised full-year revenue guidance to $97 million to $98 million, up from previous range of $94 million to $98 million, reflecting 21% to 23% year-over-year growth.
• Gross margin guidance raised to 76% to 77%, up from previous range of 75% to 76%.
• Operating expenses expected to range between $94 million and $95 million for 2025, reflecting 16% to 18% year-over-year growth.
• RNS System expected to be in the range of $20 million to $21 million in the fourth quarter, with second half 2025 RNS revenue growth at approximately 23%.

Q: Congrats on a good quarter here and strong RNS revenue growth. My first question is just on 2026 and your outlook...

A: Joel Becker notes they're well-positioned with core RNS business growing at 20% plus, and various initiatives converging to add to growth. Patrick Williams adds they provided financial supplement for clear RNS vs DIXI revenue view.

Q: Congrats on a great quarter. I think first for me, would just love to parse out the implied growth for 4Q...

A: Joel Becker mentions strong execution across business with increased prescribers, accounts, and utilization; Patrick Williams notes RNS grew 21% in first half and expects 23% growth in second half with strong Q4 start.