TREACE MEDICAL CONCEPTS, INC. Q4 FY2025 earnings call

During 2025, Treece entered transformational phase, evolving from lapoplasty-focused to comprehensive bunion solutions. Launched new bunion procedure innovations, now positioned to address 100% of surgeons' bunion correction preferences. Focused on accelerating bunion procedure volume growth and broadening technology offerings. In 2025, drove steady improvement in adjusted EBITDA and reduced cash burn. Strategies for 2026 include leveraging existing customer base for new product launches, building lapoplasty leadership, and expanding product offerings to grow wallet share. Launched new bunion systems like nanoplasty, perkiplasty 3D MIS, SPEED MTP. Plan to commercialize next-gen lapoplasty platform Lightning in 2026. Expanded product offerings in 2025 with speed plate, sterile instruments, biologics. Plan to launch SuperBite variable pitch compression screw system and SpeedXM Fusion System in 2026. Provide best-in-class education through Bunyan Masters trainings and support from clinical specialists and sales team.

Fourth quarter revenue was $62.5 million, a decrease of 9% compared to prior year. Gross margin in Q4 2025 was 80.6% vs 80.7% in Q4 2024. Total operating expenses in Q4 2025 were $56.3 million vs $55.7 million in Q4 2024. Q4 net loss was $9.4 million or $0.15 per share vs net loss of $0.5 million or $0.01 per share in Q4 2024. Adjusted EBITDA in Q4 2025 was $6.2 million vs $11.1 million in Q4 2024. Full year 2025 adjusted EBITDA loss was $3.9 million vs $11.0 million in 2024, a 64% improvement. Cash, cash equivalents and marketable securities totaled $48.4 million as of Dec 31, 2025. Full year 2026 revenue expected to be in range of $200 million to $212 million, a decline of 6% to 0% vs 2025. Full year 2026 adjusted EBITDA loss expected to be $4 million to $6 million. Cash usage expected to reduce by approximately 50% in 2026 vs 2025.

Full year 2026 revenue expected to be $200 million to $212 million, a decline of 6% to 0% vs 2025. Revenue declines to continue until seasonally strongest fourth quarter, which will be driven by accelerating case volumes, lapping mixed shift dynamics, and contribution from 2026 product launches. Full year 2026 adjusted EBITDA loss expected $4 million to $6 million. Cash usage expected to reduce by approximately 50% in 2026 vs 2025.

Forward-looking statements involve material risks and uncertainties that could cause actual results to differ from forward-looking statements. Market conditions such as broader economic conditions, softer consumer sentiment, and product mix shifts can impact results. Risks also include competition in the foot and ankle market, which could affect market penetration and revenue growth. Additionally, risks related to the successful commercialization of new products and technologies, including meeting adoption targets and competitive responses, are present.

Q: Danielle Antalfi with UBS asked about foot and ankle market softness and guidance.

A: John said surgeons reported case deferrals in 2025, Q4 case volumes increased showing share take in softer market. Outlook for 2026 has case volume increase offset by ASP mix headwinds in first half, abating in Q3 with new product launches.

Q: Lake Street Capital Markets asked about products expanding TAM.

A: Ben was told SuperBite screws in development 18 months, refined with surgeon input, SpeedXM in development for midfoot-hindfoot, tested with surgeons.

Q: Ryan Zimmerman with BTIG asked about guide variables and balancing sales force focus.

A: Mark said guide range accounts for market uncertainty and product uptake. John said sales force focused on bunion sweet spot with adjacency products as customers desire.

Q: Rick Wise with Stifel asked about competitive dynamics.

A: John said at ACFAS conference had high traffic and oversubscribed labs, surgeons appreciate full suite. Mark talked about cash flow initiatives reducing OpEx and CapEx.

Q: Richard Newit with Truist Securities asked about long-term growth and MIS osteotomy.

A: Mark said broadening portfolio with lower and higher ASP products, John said positive reception to new technologies with 25% of customers using new systems.

Q: Lily Lozada with JP Morgan asked about guide assumptions and product rollout.

A: John said guide built on uptake assumptions of MIS osteotomy, MTP fusion, and new lapoplasty products. Mark said primary strategy is driving deeper into existing surgeon base with new products.