• Total Revenue: $6.3 million in Q1 fiscal 2025, a record for NeuroOne.
• Product Revenue: $3.3 million in Q1 fiscal 2025, up 235% from $1 million in Q1 fiscal 2024.
• License Revenue: $3 million in Q1 fiscal 2025, from the expanded agreement with Zimmer Biomet.
• Product Gross Margin: 58.9% in Q1 fiscal 2025, up from 27% in Q1 fiscal 2024.
• Operating Expenses: $3.2 million in Q1 fiscal 2025, down 12% from $3.7 million in Q1 fiscal 2024.
• R&D Expense: $1.2 million in Q1 fiscal 2025, down from $1.5 million in Q1 fiscal 2024.
• SG&A Expense: $2.0 million in Q1 fiscal 2025, down from $2.2 million in Q1 fiscal 2024.
• Net Income: $1.8 million or $0.06 per share in Q1 fiscal 2025, compared to a net loss of $3.3 million or $0.14 per share in Q1 fiscal 2024.
• Cash and Cash Equivalents: $1.1 million as of December 31, 2024, down from $1.5 million as of September 30, 2024.
• Working Capital: $4.1 million as of December 31, 2024, up from $2.4 million as of September 30, 2024.
• Debt: No debt outstanding as of December 31, 2024.
• Fiscal Year 2025 Guidance: Product revenue expected between $8 million and $10 million, with gross margins between 47% and 51%.

• Warning! GuruFocus has detected 4 Warning Signs with NMTC.

Release Date: February 12, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• NeuroOne Medical Technologies Corp (NASDAQ:NMTC) achieved record product sales of $3.3 million in the first quarter, representing a 235% increase compared to the previous year.
• The company reported record product gross margins of 58.9%, nearly doubling from 27% in the first quarter of fiscal 2024.
• The expanded partnership with Zimmer Biomet, including exclusive distribution rights for the OneRF Ablation System, has significantly boosted revenue and profitability.
• The OneRF Ablation System has shown promising clinical results, with most patients becoming seizure-free or experiencing significant seizure reduction.
• NeuroOne Medical Technologies Corp (NASDAQ:NMTC) has strengthened its balance sheet with a $3 million license payment from Zimmer Biomet and improved transfer prices, leading to better financial stability.

Negative Points

• Despite strong first-quarter results, NeuroOne Medical Technologies Corp (NASDAQ:NMTC) expects a sequential decline in product revenue in the second quarter of fiscal 2025.
• The company reported a decrease in cash and cash equivalents from $1.5 million to $1.1 million as of December 31, 2024.
• There is uncertainty regarding the timeline for FDA clearance of the Trigeminal Nerve RF Ablation System, which could impact future revenue projections.
• Operating expenses, although decreased, remain significant at $3.2 million for the first quarter of fiscal 2025.
• The company's future revenue guidance excludes potential contributions from the Trigeminal Nerve RF Ablation System, indicating reliance on existing products and partnerships.

Q & A Highlights

Q: Why have your results been so positive to date, and what is the measuring stick for clinical success for epilepsy? A: Dave Rosa, CEO, explained that the success is due to the use of the same device for both diagnostic and therapeutic purposes, allowing for a single hospitalization. The measuring stick for success is typically one year post-surgery seizure-free or a significant reduction in seizures. Currently, one patient has been seizure-free for over nine months.

Q: You reported a strong product gross margin of almost 60% in Q1, but your guidance for the year is 47% to 51%. Are these margins sustainable long term? A: Dave Rosa, CEO, stated that the margins of 47% to 51% are sustainable. The higher margin in Q1 was due to NeuroOne commercializing the technology directly before finalizing the agreement with Zimmer Biomet. The expected margins for the year are within the provided guidance range.

Q: What does NeuroOne need to do before submitting the 510(k) application for facial pain, and how long is the expected FDA review? A: Dave Rosa, CEO, mentioned that remaining testing such as sterilization and packaging is required before submission. The application process has already started, and based on past experience, FDA review could take about five months, though this is not guaranteed.

Q: What are the financial highlights from the first quarter of fiscal 2025? A: Ron McClurg, CFO, reported record product sales of $3.3 million, a 235% increase from the previous year, and a product gross margin of 58.9%. Total revenue, including license revenue, was $6.3 million. Operating expenses decreased by 12%, and the company reported a net income of $1.8 million compared to a net loss in the previous year.

Q: How does the partnership with Zimmer Biomet impact NeuroOne's growth and profitability? A: Dave Rosa, CEO, highlighted that the partnership with Zimmer Biomet, which includes exclusive distribution rights for the OneRF Ablation System, is expected to boost revenue and profitability due to improved transfer prices and Zimmer's extensive distribution network.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.