Vivos Therapeutics, Inc. Q3 FY2025 earnings call

• Acquisition of Sleep Center of Nevada in June 2025: This group medical practice in Las Vegas specializes in sleep testing and interpretations, and its acquisition led to the establishment of Sleep and Airway Medicine Centers (SAMC) in two locations.
• Business model pivot: Shifted from reliance on dentists to direct affiliations with medical sleep practices to get Vivos technology in front of more OSA patients. Cooperation from SCN's medical team exceeded expectations.
• Expansion efforts: Expanded facilities in Las Vegas, increased sleep optimization teams, and are working on credentialing new providers with third-party payers.
• Future initiatives: Plans for 2026 and beyond include expanding diagnostic/treatment services, a pediatric OSA program, and collaboration with specialty medical groups like a cardiology practice in Nevada. Refined collaboration affiliation model for sleep centers not interested in acquisition.

For the third quarter of 2025, revenue increased 76% to $6.8 million compared to $3.9 million in Q3 2024 and 78% sequentially versus Q2 2025. The increase in total revenue reflected an additional $2.7 million in service revenue and approximately $200,000 in additional product revenue. For the 9 months ended September 30, 2025, revenue increased approximately 20% to $13.6 million compared to $11.3 million for the same period in 2024. Service revenue increased due to $2.8 million in sleep testing services (primarily from SCN) and $1.6 million in new treatment center revenue. Cost of sales, general and administrative expenses, and net loss increased due to the acquisition of Sleep Center of Nevada (SCN) and the business model pivot. Revenue contribution from SCN's OSA sleep testing services and new treatment centers was significant, while VIP enrollment revenue from the legacy model decreased but became less material.

• Revenue is expected to continue growing as dental providers and nurse practitioners are licensed and credentialed, with a 3-6 month ramp to full optimized revenue levels.
• Anticipate contribution margins of 50%-60% at steady-state for SAMC operations.
• Goal is to reach cash flow breakeven as profits and revenues from SAMC centers accrete, with the potential to get closer to breakeven through more affiliations and acquisitions.

• Uncertainties in the provider credentialing process with third-party payers, which can take 2-6 months depending on the payer.
• Delays in licensing and credentialing of new providers affecting revenue generation.
• Dependence on successful execution of the acquisition and affiliation models, as any setbacks could impact growth and financial performance.

Q: How should we model sales for the next few quarters?

A: Revenue to continue growing as dental providers and nurse practitioners are added, with a 3-6 month ramp for full optimized revenue levels. We're leaving money on the table until providers are built up and credentialed.

Q: How do recognition of revenue differ between models?

A: In the case of an acquisition like SCN, revenue is captured at shipment of related products and OSA diagnostic/treatment revenue. In contractual alliances, revenue is captured from appliance sales as principal, with possible fee splitting or profit sharing with sleep medical provider affiliates.