STIM — Neuronetics, Inc.

Summary of Neuronetics, Inc. Q4 2025 Earnings Call

1. Key Financial Results and Metrics

• Total Revenue: $41.8 million, an 86% increase from $22.5 million in Q4 2024, largely due to the Greenbrook acquisition.
• Adjusted Pro Forma Revenue Growth: 23% year-over-year.
• NeuroStar Business Revenue: $18.3 million, a 9% increase on a pro forma basis.
• Gross Margin: 52%, down from 66% in the prior year, attributed to the lower-margin Greenbrook clinic business.
• Operating Expenses: $26.7 million, slightly up from $26.4 million in Q4 2024.
• Net Loss: $7.2 million ($0.10 per share), improved from a loss of $12.7 million ($0.34 per share) in Q4 2024.
• EBITDA: Negative $4.3 million, improved from negative $11.0 million in the prior year.
• Cash Position: $34.1 million as of December 31, 2025, up from $19.5 million in 2024, with positive cash flow from operations of $0.9 million in Q4.

2. Strategic Updates and Business Highlights

• Leadership Transition: Dan Reavers appointed as the new President and CEO effective March 23, 2026.
• Greenbrook Integration: Successful integration with a 28% increase in full-year clinic revenue, and significant growth in referring provider network (430 new providers added in Q4).
• Treatment Volume: Total treatment volume increased by 18% year-over-year in Q4, with a focus on improving patient referral processes and operational efficiencies.
• SPRAVATO Rollout: 84 clinics now offering SPRAVATO, with ongoing optimization of billing practices.
• NeuroStar Business Growth: Strong system sales with 49 systems shipped in Q4, maintaining high average selling prices.

3. Forward Guidance and Outlook

• 2026 Revenue Guidance: Expected total revenue of $160 million to $166 million, representing over 9% growth year-over-year.
• Clinic Revenue Growth: Anticipated double-digit to mid-teens growth.
• NeuroStar Revenue Growth: Expected low to mid-single-digit growth.
• Q1 2026 Revenue Projection: Between $33 million and $35 million, with expectations for improved cash flow in the second half of the year.

4. Bad News, Challenges, or Points of Concern

• Gross Margin Decline: The inclusion of Greenbrook's lower-margin operations has negatively impacted overall gross margins.
• Ongoing Investigation: The company is cooperating with a U.S. Attorney's Office investigation regarding billing practices prior to the Greenbrook acquisition, which could pose reputational risks.
• Seasonality Effects: Q1 typically sees lower revenue due to seasonal patient volume declines and weather impacts, which could affect short-term performance.

5. Notable Q&A Insights

• Investigation Details: Management confirmed they are providing requested documentation related to billing practices prior to the Greenbrook acquisition.
• COMPASS Collaboration: Greenbrook is positioned as a significant partner for the launch of COMP360 psilocybin therapy, with discussions ongoing about operational readiness.
• SPRAVATO Utilization: The integration of SPRAVATO into new clinics is expected to ramp up quickly, supported by existing operational frameworks.
• Cash Management: The recent $5 million debt repayment is expected to reduce interest expenses and improve cash flow management.

Overall, Neuronetics, Inc. demonstrated strong growth in Q4 2025, driven by the Greenbrook acquisition and operational efficiencies, while also facing challenges related to margin pressures and ongoing investigations. The company is optimistic about its growth trajectory for 2026, with strategic initiatives aimed at expanding treatment access and improving financial performance.