Tenon Medical, Inc. Q4 FY2024 earnings call

• In 2024, the initiative to restructure and invest in sales and marketing to build market share for the Catamaran System led to 12% revenue growth for the full year. • Fourth quarter revenue decline was due to reimbursement preauthorization headwinds, but future coding clarity and clinical data are expected to help. • Completed alpha clinical review of the Catamaran SE platform, a second-generation smaller version, with full commercial launch slated for mid-2025. • Received three U.S. patents in the fourth quarter related to the Catamaran portfolio. •推进MAINSAIL post-market study, with first peer-reviewed publication of interim analysis in Q3 2024 showing positive outcomes. • Hosted 24 physicians in Catamaran workshops in Q4 2024, focusing on commercial expansion, workshop/training programs, SE platform launch, and completing MAINSAIL study in 2025.

Full year 2024 revenue was $3.3 million, a 12% increase. Fourth quarter 2024 revenue was $770,000, a 4.7% decline from the prior year quarter. Full year gross margin was 52%, up 10 percentage points from 42% in the prior year. Fourth quarter gross profit was $353,000, 46% of revenue, compared to $559,000 or 69% of revenue in the prior year fourth quarter.

• Stable cost structure expected to maintain gross margin at recent levels and improve with revenue growth. • Focus on driving topline via commercial expansion, workshop and training programs, launching Catamaran SE platform mid-2025, and completing MAINSAIL study. • Anticipate increases in sales and marketing expenses in future quarters as part of investment in growth.

• Uncertainty in the reimbursement environment which could impact revenue. • Clinical research progress is uncertain and could affect the company's value proposition and market coverage.

Q: How is the reimbursement landscape progressing, especially with more data available?

A: Tenon is actively working with decision makers to bring clarity. Progress is being made, but it's a process. Reimbursement pre-approvals still have some delays, but great progress has been made and clarity is anticipated.

Q: Regarding sales perspective for full year 2025, any plans to add sales people?

A: Made significant additions to sales organization in 2024, with 6 direct area sales managers in place. Have 42 existing independent distributor contracts, with more horsepower in the field for coverage in key geographies.