SANUWAVE Health, Inc. Q3 FY2025 earnings call

• Revenue in Q3 2025 was an all-time record, up 22% Y/Y and 13% sequentially, with Y/Y growth for the first 9 months of 2025 at 39%.
• Sold 155 UltraMIST systems in Q3, an all-time record. Applicator revenue was $6.8 million, an all-time record.
• Gross margins were 77.9% in Q3, impacted by lower ASP of UltraMIST systems but offset by higher applicator prices and cost reductions. Progress on new applicator mold and process with expectation of commercial production in January 2026.
• Received $5 million payment for IP licensing related to intravascular Shockwave patent portfolio. Refinanced debt, reducing $27.5M of debt to $24M with interest rate from 19.5% to SOFR plus 350. Moved to new larger headquarters in August. Alleviated substantial doubt to continuous concern for at least 12 months.
• Wound care market was unsettled in Q3 due to uncertainty in skin substitute and allograft reimbursement, but seen as an overall positive trend for SANUWAVE with emerging opportunity as market adapts to new reality.

In Q3 2025, SANUWAVE achieved an all-time record revenue quarter. Revenue was up 22% Y/Y and 13% sequentially. UltraMIST systems: Sold 155 units in Q3, an all-time record, with 1,416 units in the field, 504 (36%) sold in the trailing 12 months. Applicator revenue: $6.8 million in Q3, an all-time record, up 26% Y/Y and 6% sequentially, making up 59% of Q3 revenues, in line with the 55%-65% target range. Gross margins were 77.9% in Q3, slightly down from last quarter but up from a year ago, impacted by lower ASP of UltraMIST systems due to working with larger resellers but offset by higher applicator prices and cost reductions.

• Guiding to $13 million to $14 million in Q4 2025 revenues, representing another all-time high revenue quarter for SANUWAVE.
• Optimism due to alleviating market concern around wound reimbursement uncertainty, with movement beginning and log jams breaking free as final rule on reimbursement is known.

• Market uncertainty around wound care reimbursement, leading to providers taking a wait-and-see attitude and backing off on advanced wound care treatments at the margin. Potential audit and price sensitivity concerns in the wound care market.

Q: Due to disruption in skin substitutes, curious if seeing inbound interest from resellers scrambling to pick up additional products to fill revenue gap.

A: Yes, there is substantial realignment beginning, seen some inbound interest but premature to say ton of new deals, distribution is important in the space.

Q: Latest rep headcount?

A: Rep headcount is still 13, rejiggered to 12 national territories with 2 full-time national key account managers.

Q: Considering CMS fixed rate, would private physician practices look to UltraMIST as additional line of revenue and how long it takes to play out?

A: Yes, physicians may see it as an interesting option due to balancing patient care and business, but how long it plays out varies.

Q: What happens to mobile wound care given CMS change and percent tied to mobile space?

A: Mobile wound care experiencing same issues, 55% of practitioners billing UltraMIST haven't built skin sub in 4 years, some providers using skin subs may see practice changes.

Q: Toeholds in large wound centers and how to get around capital approval process?

A: Starting to spread in large hospital networks, added to approved vendor lists. Considering rental model for hospitals with tight cap budgets to address capital approval issues.

Q: Bifurcating market with direct to large accounts and resellers to small customers?

A: Internal discussion on this, exploring how to integrate distribution network with sales force, with applicators often ordered directly from SANUWAVE portal with commission to distributors.

Q: Leverage with resellers in current environment?

A: No specific comment on leverage, but current market situation provides opportunity for SANUWAVE to make new friends and see increased inbound interest.