NRXS — NeurAxis, Inc.

NeurAxis, Inc. (NRXS) Q3 2025 Earnings Call Summary

1. Key Financial Results and Metrics:

• Revenue: $811,000, a 22% increase from $677,000 in Q3 2024.
• Unit Deliveries: Increased by approximately 38% year-over-year, marking the sixth consecutive quarter of double-digit unit growth.
• Gross Margin: 83.3%, down from 85.4% in the previous year, attributed to higher discounting and lower-margin sales through the financial assistance program.
• Operating Expenses: Totaled $2.8 million, up 25% from $2.2 million in Q3 2024.
• Operating Loss: $2.1 million, a 27% increase compared to $1.7 million in Q3 2024.
• Cash Position: $4.4 million as of September 30, 2025, with an additional $2.8 million raised in October through equity offerings.
• Free Cash Flow Burn Rate: Maintained at $1.5 million per quarter.

2. Strategic Updates and Business Highlights:

• Continued execution of the commercialization strategy for IV Stem and RED, focusing on expanding access through medical policy coverage.
• Anticipation of a new category one CPT code effective January 1, 2026, expected to enhance reimbursement and streamline billing processes.
• Engagement with major insurers is ongoing, with a focus on securing pediatric coverage and improving prior authorization processes.
• The company has expanded its indication for IV Stem to include functional abdominal pain and functional dyspepsia in both pediatric and adult populations.
• A significant emphasis on targeted marketing and education initiatives for healthcare providers to prepare for the upcoming CPT code changes.

3. Forward Guidance and Outlook:

• Revenue growth is expected to continue into Q4 2025, driven by strong demand and acceptance of products.
• The company is preparing for a potential volume inflection in 2026 with the implementation of the new CPT code and improved insurance coverage.
• Management remains cautious, forecasting that initial revenue conversion may lag as hospitals adapt to new workflows.

4. Bad News, Challenges, or Points of Concern:

• The decline in gross margin due to increased discounting and lower-margin sales through the financial assistance program.
• Potential reimbursement challenges for IV Stem in the adult market due to the lack of large studies conducted specifically in adult patients.
• The company faces competition from established products like ARM, which may hinder the adoption of the RED device.
• Operating losses are increasing, raising concerns about the sustainability of current cash reserves amidst ongoing operational costs.

5. Notable Q&A Insights:

• Management emphasized the importance of incentivizing the sales team to prepare for the anticipated volume increase post-CPT code implementation.
• There is a cautious optimism regarding payer engagement, with management confident in their comprehensive approach to securing coverage.
• SG&A expenses are expected to rise as targeted marketing efforts ramp up ahead of the CPT code change, with a focus on payer engagement.
• Future cash flow and liquidity are contingent on the successful adoption of the new CPT code and potential insurance coverage, with management prepared to adjust strategies based on market response.

Overall, NeurAxis, Inc. is positioned for growth with strategic initiatives aimed at expanding market access and improving reimbursement processes, despite facing challenges related to margin pressures and competitive dynamics.