Vericel Corporation Q1 FY2026 earnings call

Nick Colangelo mentioned the company had great first quarter with strong financial and commercial results. Macy had double-digit volume growth, expanded sales force in new territories with strong performance in biopsies, implants, etc. Burn care had strong revenue growth and announced BARDA award. Joe Marra discussed financial measures, margin expansion, and updated revenue guidance. Focus on Macy's commercial excellence initiatives, Macy-Arthro leading indicators, and progress on clinical data for Macy-Arthro. Also, progress on FDA approval for Macy commercial manufacturing and plans for UK marketing application.

Total revenue was over $68 million, up 30% year-over-year. Macy had record first quarter revenue of over $56 million, a 22% increase vs prior year, with double-digit volume growth. Burn care first quarter revenue increased over 90% to $12 million. Macy's trailing four-quarter revenue growth rate was 23%, Burn care's trailing four-quarter growth rate was above 20%. Gross margin increased over 300 basis points to 72%, adjusted EBITDA margin increased nearly 800 basis points to 14%, adjusted EBITDA tripled to nearly $10 million. Free cash flow was over $15 million, ending the quarter with over $210 million in cash and investments.

Raised total revenue guidance range by $10 million to $326 - $336 million. Raised Macy revenue guidance to $282 - $288 million, expecting ~$62.5 - $63.5 million in Q2. Raised burn care revenue guidance to ~$44 - $48 million, expecting ~$9 - $10 million in Q2. Expect ~$5 - $6 million of Nexabrid BARDA procurement revenue in second half, with procurement starting in Q3. Continue to expect gross margin ~75% and adjusted EBITDA margin ~27% for full year, ~72% gross margin and ~18% adjusted EBITDA margin for Q2.

Q: On guidance outlook, what's the assumption set for Macy Trends and Arthro moving through the year and in Q2.

A: Joe Marra discussed drivers of guidance increase including Q1 outperformance and Nexabrid barter revenue. Assumptions on burn care and Macy's execution.

Q: On competitive landscape with competitor stepping into better reimbursement, Nick Colangelo discussed that Agilecy is for different patient population than Macy, no overlap.

Q: On Macy-Arthro's penetration and addressable population, Nick Colangelo talked about Macy-Arthro's contribution in small condyle defect segment and addressable patient population.

Q: On sales force and break even, Nick Colangelo talked about sales force expansion and strong performance.

Q: On Macy-Arthro data publication and adoption, Nick Colangelo talked about importance of clinical data.

Q: On cartilage lesion segmentation, Nick Colangelo talked about Macy's position.

Q: On biopsies and implant from new salesforce, Joe Marra talked about mix of reps and positive signs.

Q: On Arthro's penetration and addressable population, Nick Colangelo talked about Macy-Arthro's contribution in small condyle defect segment and addressable patient population