AXGN

Image source: The Motley Fool. Wednesday, July 29, 2026 at 8:00 a.m. ET President and Chief Executive Officer - Michael Dale Chief Financial Officer - Lindsey Hartley Operator: Good morning, everyone. Joining me on today's call is Michael Dale, Axogen's President and Chief Executive Officer; and Lindsey Hartley, Chief Financial Officer. Michael will discuss second quarter 2026 financial results and corporate highlights. Lindsey will then provide details on financial performance and overall outlook for the year. This will be followed by a question-and-answer session. Today's call and presentation is being broadcast live via webcast, which is available on the Investors section of Axogen's website. Following the end of the live call, a replay will be available on the Investors section of the company's website at www.axogeninc.com. Before we begin, I would like to remind you that during this conference call, management will be making forward-looking statements. Forward-looking statements include statements regarding financial guidance and outlook; clinical development and regulatory efforts; commercial growth initiatives, reimbursement and market access efforts; training and education initiatives; research and development activities; and overall business strategy and performance. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially, including, without limitation, the risks and uncertainties reflected in the company's filings with the Securities and Exchange Commission, including the most recent annual report on Form 10-K, subsequent quarterly reports on Form 10-Q and other filings made with the Securities and Exchange Commission. Forward-looking statements speak only as of the date they are made and the company undertakes no obligation to update any forward-looking statements except as required by law. In addition, for a reconciliation of non-GAAP measures, please refer to today's press release, presentation with highlights from today's call and the corporate presentation on the Investors section of the company's website. Now I'll turn the call over to Michael. Michael, please go ahead. Michael Dale: Thank you, operator, and good morning, everyone. Today, I will walk you through our second quarter performance using the same lens we've used all year, which are the 6 priorities that comprise our strategic plan. Once I've concluded my commentary, Lindsey will review our financials in detail. After which, we'll open the call for questions. As preface to my review of performance for each strategic priority, I want to make clear on behalf of the Axogen team that we are delighted with our customer creation and market development performance. What you will hear today is that consistent with our plans across Extremities, OMF & Head and Neck, and Breast and prostate; we are exceeding our goals for growing adoption of nerve care by existing surgeons, increasing the numbers of new surgeons, expanding the number of new accounts and growing patient awareness overall. Our 23% year-over-year revenue growth this quarter and increased revenue guidance for the remainder of the year reflects this progress and our confidence in the appropriateness of our strategic priorities. While all markets are enjoying strong year-over-year growth, Breast growth is particularly strong and accelerating, reflecting the impact of our market development programs, increased patient awareness, improved coverage and payment and expanded sales force coverage. As a result, we will be reporting on the Breast business separately in more detail. Starting with our first priority, revenue growth and financial operating leverage. As reported this morning in our earnings release, second quarter revenue was $69.7 million, up 23.1% versus the second quarter of 2025, reflecting broad-based growth across all 3 target markets. Breast led the way contributing approximately 2/3 of the quarter's growth with first half 2026 revenue up 47% year-over-year. At the same time, Extremities, OMF & Head and Neck and other indications combined delivered solid 15% year-over-year growth through the first half. Adjusted net income was $7.3 million for the quarter, adjusted EBITDA was $8.4 million and we ended the period with $113.4 million in cash, cash equivalents, restricted cash and investments. Consistent with prior quarters, performance was driven by strong demand for Avance and continued adoption of our broader product algorithm across all target markets. Avance represented 65% of total revenue in the second quarter and 63% year-to-date, up from approximately 60% in 2025. Commercial execution remains strong across the business. Sales force productivity continued to exceed our expectations and our active surgeon count increased meaningfully during the quarter, an indicator we monitor closely because it reflects broader institutional adoption of nerve care. We are also realizing the benefits of the sales force expansion investments we made throughout 2025 and the first half of 2026 as those representatives progress through their ramp and approach full productivity consistent with our market development model. Overall, these results reflect the strength of our commercial organization, the growing adoption of nerve care and consistency and execution of our long-term growth strategy. Gross margin for the quarter was 72.7% compared to 74.2% for the second quarter of 2025 and less than our plan. The shortfall was driven primarily by product mix as breast growth accelerated faster than planned and relies more heavily on longer Avance breasts, which carry higher production costs. Our manufacturing plans anticipated a growing breast business, but not the relative change in revenue mix between our target markets that is now occurring and the resulting impacts on longer graft product mix. We will address these changes in product mix through pricing actions and production efficiency initiatives. However, these measures will take time to implement and as such, are unable to affect the remainder of our 2026 forecasted product mix. As a result, we are updating our 2026 gross margin guidance to be at least 73%. Looking forward, our operating bias remains to support growth in all target markets while continuing to improve operating margin, EBITDA and operating profit. Moving on to our second priority, market development across Extremities, Oral Maxillofacial & Head and Neck and Breast. Consistent with prior quarters, each of our 3 target markets contributed positively to second quarter results. Extremities and OMF & Head and Neck, both continued the steady progress we've described on prior calls reflecting ongoing incremental surgeon activation and adoption of the Axogen nerve repair algorithm and continued account level engagement, reflecting strong execution of our high potential account development strategy. As mentioned earlier in my comments, year-to-date Breast grew 47% year-over-year driven by added commercial capacity, training of new surgeons, expansion of coverage and payment and increasing surgeon and patient awareness. We believe we're still early in this market's development even as it becomes a larger part of our overall mix. We now have roughly 215 active breast programs, an increase of over 40 programs year-over-year and roughly 560 active surgeons, an increase of over 150 surgeons year-over-year. As a reminder of how we think about our markets longer term, each one sits at a different stage of development with different referral patterns, different training requirements and different reimbursement dynamics. We outlined the size and potential of each prioritized market opportunity at our Analyst Day in March 2025 and second quarter and year-to-date results continue to reinforce the validity of this opportunity framework. We remain confident these markets can support double-digit growth for a long time as we continue to build the infrastructure, the evidence and the awareness required to make nerve repair an expected standard of care. With regards to priority 3, commercial expansion, we ended the second quarter with a total commercial organization of 172 sales representatives, market development managers and regional directors across all markets, consistent with our plan for disciplined, steady expansion of our commercial footprint. Year-to-date we have added 15, including 9 in Extremities and 6 in Breast, bringing those teams to 140 and 29, respectively, along with 3 dedicated market development managers in OMF & Head and Neck. We are very encouraged by our return on investment in sales force expansion. New representatives, those in their role for less than 9 months, continue to contribute meaningfully to our growth. We believe these results validate one of our core assumptions that expanding sales coverage is one of the most important levers within our control to affect market development and customer creation. The fourth priority of our strategic plan is commercial excellence, specific to our emphasis on high potential accounts, productivity and education. High potential accounts continue to be a primary engine for our revenue growth representing 60% of total revenue and 51% of growth year-to-date. Consistent with overall Axogen growth, productivity in high potential accounts was 20% year-over-year. The number of active high potential accounts increased to 690, up 11 year-to-date. Non-high potential accounts continue to grow as well representing 40% of Axogen's total revenue year-to-date and driving 24% year-over-year productivity per account. Growth in these accounts reflects growing awareness and adoption of nerve care in general. Active surgeon growth has increased by more than 210 year-to-date with more than 135 added within high potential accounts year-to-date. We have exceeded our plan for active surgeon growth in 2026. Regarding our professional education programs, year-to-date we have conducted 9 programs across all target markets training 155 surgeons. Next, I'd like to update everyone on our fifth priority, standard of care, evidence and coverage development. As of today, commercial payer coverage for Avance is approximately 86% of covered lives in the United States. Aetna remains the largest commercial payer not yet covering Avance. Based on historical timing, we expected an update in June. However, Aetna's review is ongoing. If Aetna issues a favorable decision, we will consider that near universal commercial coverage in our existing markets in the United States with approximately 95% of commercial lives with access to Avance. At that point, only a few regional payers in Humana will remain. Evidence generation remains a core pillar of our strategy to support development of nerve care guidelines and drive broader adoption of nerve repair and protection. This quarter, we advanced this strategy across multiple fronts. The recently published REPOSE study is an important example. REPOSE provides prospective randomized clinical evidence evaluating Axoguard Nerve Cap as an adjunct to standard neurectomy for symptomatic neuroma. The results reinforce the clinical rationale for protecting the nerve end after resection with favorable signals in pain burden, medication reliance and recovery-related outcomes over follow-up. Importantly, we view REPOSE as more than a study in 1 procedure. It strengthens the evidence foundation for our nerve protection portfolio and supports the broader clinical message that nerve management matters when surgeons are addressing pain, function and quality of life. We are also advancing RESTORE, our randomized assessor-blinded study comparing Avance to sural nerve autograft in mixed and motor peripheral nerve reconstruction. This is strategically significant because autograft has long been viewed as the historical benchmark in complex nerve reconstructions. In second quarter, we activated our first site in the United States and are screening for patients. We are on track for additional site activations in the second half of 2026. Another important evidence generation initiative is Embrace, our prospective assessor blinded study evaluating sensory restoration following nipple-sparing mastectomy and implant-based breast reconstruction comparing Avance supported neurotization to reconstruction without neurotization. As we have discussed previously, generating high quality clinical evidence in breast reconstruction remains an important strategic priority for Axogen. The program remains on track for initiation later this year consistent with our strategic operating plan. Taken together, these initiatives demonstrate execution as planned of our strategic evidence generation plan to make restoration of peripheral nerve function standard of care. And finally, our sixth priority, which is about innovation, research and development and therapeutic reconstruction. Consistent with our strategy to expand Axogen's leadership in peripheral nerve care, we made a strategic investment in Trace Biosciences this quarter acquiring a minority ownership stake, including a limited right of first refusal. Trace's nerve-specific imaging technology, Nervetrace, is designed to help surgeons visualize nerves in real time, potentially reducing nerve injury and improving the identification of repair opportunities. We view Trace as a highly complementary adjacency to Axogen platform. Trace helps surgeons find and protect nerves while Avance supports repair when a nerve gap is identified, serving the same surgeons, patients and procedural setting. Trace received FDA clearance of its IND in January 2026 and our investment supports advancement through Phase II and III clinical trials toward an NDA. This structure gives Axogen exposure to a differentiated technology with strategic fit while preserving capital discipline and future flexibility as the program progresses. Turning to our prostate program. We continue to make progress and our clinical development work remains on plan. We expect to share more on the next phase of our strategy during our third quarter earnings call. What we continue to hear through our surgical experience program is that there is a meaningful unmet need. Erectile dysfunction and incontinence remains significant quality of life challenges for many patients after radical prostatectomy. We believe nerve reconstruction with Avance may have an important role to play and this work is helping us better understand the urology market, build procedural experience and generate early data. As we look ahead, our decision to move forward will be guided by the market opportunity, the ability to standardize and scale the Avance technique, surgeon feedback on clinical impact and evidence of patient demand that can help shape the care pathway. So far, our assessment is progressing well and we look forward to providing a detailed update in the fourth quarter. In closing, second quarter performance reflects continued disciplined execution against our strategic plan and commitment to our business purpose to restore health and improve quality of life by making restoration of peripheral nerve function an expected standard of care. We're encouraged by the momentum across the business and are confident in our ability to overcome the inevitable challenges that come with new market development and building an enduring profitable business. I'll now turn the call over to Lindsey to walk through the financials in more detail and our updated outlook for the remainder of 2026. Lindsey Hartley: Thanks, Mike. I'm pleased to report our second quarter 2026 financial results. For the second quarter, we reported revenue of $69.7 million reflecting growth of 23.1% year-over-year. Revenue growth continues to be driven by strong demand for Avance and adoption of our product algorithm across target markets with unit volume serving as the primary driver then price. For the first time, sales from extremities were less than 50% of total sales as we experienced growth of over 50% year-over-year in our Breast market. Through the first half of 2026, we continue to have double-digit year-over-year growth in all our markets. Gross profit for the second quarter came in at $50.7 million. This represents a gross margin of 72.7%. Gross margin decreased 150 basis points year-over-year driven by 4.6% higher product costs, partially offset by 2.7% lower write-offs. Sequentially, gross margin declined 250 basis points driven by 1.8% higher product costs and 0.7% write-off. Gross margin in the second quarter was less than our internal projections primarily due to: one, selling more higher cost biologic Avance starting in April than expected; and two, the demand for certain long length Avance growing faster than the rest of the Avance portfolio. These 2 factors impacted gross margin approximately 1% versus our internal expectations. This demand for long length Avance largely stemming from the growth of our Breast business exceeded our internal expectations by approximately 14% in the quarter. To better align production with this updated demand profile, we adjusted our production plans beginning in the third quarter, which we expect will increase Avance product cost. As a result, we now expect our full year 2026 gross margin to be at least 73%. As for the cadence of the second half, we expect gross margin to be higher in the third quarter than the fourth quarter. As our non-breast markets continue to grow and demand broadens across a wider range of graft sizes, we expect donor yield efficiency to improve, supporting gross margin expansion over time. We also have multiple initiatives underway focused on increasing graft yields, including long length Avance grafts. We plan to provide an updated long-term financial framework in the first quarter of 2027. With recent payer coverage wins and BLA approval creating meaningful growth opportunities, we believe additional time is needed to assess their full impact. We have consistently outperformed our long range revenue growth target of 15% to 20% CAGR and believe we remain well positioned to continue doing so. Operating expenses increased to $52.8 million in the second quarter, up from $40.3 million in the second quarter of 2025 and increased 4.6% as a percentage of revenue. The increase year-over-year was driven primarily by compensation cost and stock-based compensation expense tied to certain PSUs anticipated to achieve above target on revenue growth components. Sequentially, as a percentage of revenue, operating expenses decreased 4 percentage points. Sales and marketing expenses as a percentage of total revenue increased 2.2 percentage points to 44.2% in the second quarter compared to 42% in the second quarter of 2025. The increase year-over-year reflects investments in our commercial strategy to support our market development initiatives and long-term growth plans. Sequentially, as a percentage of revenue, sales and marketing expenses decreased 2.4 percentage points. Research and development expenses increased 25.3% to $8.6 million in the second quarter compared to $6.9 million in the second quarter of 2025 and as a percentage of total revenue, increased slightly to 12.3% from 12.1%. Our continued investment in research and development is essential to our mission of making peripheral nerve repair a standard of care through the development of clinical evidence and innovation. Sequentially, as a percentage of revenue, research and development expenses remained relatively flat. General and administrative expenses increased 38.4% to $13.4 million in the second quarter compared to $9.7 million in the second quarter of 2025 and as a percentage of total revenue, increased 2.2 percentage points to 19.3% from 17.1%. Sequentially, as a percentage of revenue, general and administrative expenses decreased 1.7 percentage points. Net loss for the second quarter was $1.5 million or $0.03 per share compared to net income of $0.6 million or $0.01 per share in the second quarter of 2025. Sequentially, net loss improved $18.1 million. As a reminder, net loss in the first quarter included a onetime loss of $16.8 million, which was incurred upon the extinguishment of our debt facility in January. Adjusted net income was $7.3 million or $0.12 per share for the second quarter compared to an adjusted net income of $5.7 million or $0.12 per share for the second quarter of 2025. Sequentially, adjusted net income improved $3.1 million. Adjusted EBITDA for the second quarter was $8.4 million compared to an adjusted EBITDA of $9.3 million in the same period last year. And as a percentage of revenue, decreased 4.2 percentage points to 12.1% from 16.3%. Sequentially, adjusted EBITDA improved $2.7 million. Adjusted net income and adjusted EBITDA are calculated as net income or EBITDA adjusted for stock-based compensation and the loss on the extinguishment of the debt. The improved bottom line performance demonstrates our ability to drive both top line growth and enhanced profitability. As of June 30, 2026, cash, cash equivalents, restricted cash and investments totaled $113.4 million. Through the first half of 2026, we generated $4.1 million of free cash flow. Based on our year-to-date performance and visibility into the remainder of the year, we are revising our full year 2026 financial guidance. We now expect full year 2026 revenue growth of at least 24% or revenue of at least $279 million. Full year 2026 gross margin is now expected to be at least 73% and we continue to expect to be free cash flow positive for the full year 2026. This guidance reflects continued confidence in commercial execution across all 3 core markets and the ongoing sales force productivity improvement. It does not assume material benefit from payer coverage decisions beyond what is already known. With that, we will now open the line for questions. Operator? Operator: Our first question is from the line of Mike Sarcone with Jefferies. Michael Sarcone: I guess just to start, I wanted to hone in on 2Q. Nice quarter, but we did see some decel versus the 1Q and I know you saw some pretty nice acceleration in Breast. I was wondering if you could unpack growth in some of the other markets just for the 2Q. I know you gave us kind of an update on the 1H growth, but maybe dig more into 2Q and talk about the moving pieces there, if possible. Michael Dale: Sure, Mike. We're not going to break out the other segments as we are now Breast going forward. However, the other markets are growing consistent with prior comments. So relatively different bases, Extremities being the largest; OMF, Head and Neck being smaller; but all the markets are growing handsomely. Michael Sarcone: Okay. Great. And then maybe just on the outlook. That's a nice guide raise you baked in there. I was wondering if you could talk about what are the key assumptions as we get into 2H? Any color on the end markets there? And then how we should think about sales cadence through the rest of the year? Michael Dale: Sure. So what we're -- the most significant factor if we had to pull one out that we now have enough time to look back upon is the investments in sales footprint coverage. So for all markets, those individual investments have been very rewarding. So very high double digits. In other words, expand the opportunity to knock on a door and people respond. So we will be working hard to accelerate that activity. Obviously we have a plan for this year. We're going to look at expanding it further and will continue into the future. The caveat or not caveat, but the constraint in terms of those investments will be that we will not go backwards in profitability, but we will continue to expand as aggressively as we can within that constraint, the sales force footprint. The other element that we see direct evidence taking place is that in the planned procedures such as Breast for example, the patient awareness and the surgeon awareness has grown significantly and is becoming a driver of activity and adoption. All the other elements are also very positive just in general for the business, coverage and payment. But in terms of picking out 2 elements that are major factors that we're gaining more and more confidence in, it would be sales force footprint expansion and then secondly, patient and surgeon awareness. Michael Sarcone: Awesome. And if I could just squeeze one more in there. Just you talked about Aetna continuing to review the policy. Any cause for concern that they haven't published an update in kind of the timelines you've seen historically or how are you guys thinking about Aetna coverage timing? Michael Dale: I'll let Rick elaborate. But no, I mean we're disappointed that they haven't made a decision. We thought for sure that there would be one in June. But we know there is activity, but I'll let Rick comment. Rick Ditto: Mike, thanks for the question. We know they're looking at it and I would -- I try to view it through the optimistic lens, which is sometimes these medical policies can just get rubber stamped. Hey, this is the annual update, we're just going to pass it through and approve it. And the fact that they're taking time I think means they want to get it right. So we're hopeful. Operator: The next question is from the line of Larry Biegelsen with Wells Fargo. Gursimran Kaur: This is Simran on for Larry. Congrats on the results here. Maybe just to start off on gross margin. Mike, maybe help me understand, I think we generally view Breast as a higher ASP opportunity. So just any additional color that you can provide around what exactly is driving the lower margin profile for Breast? And can you elaborate on those pricing and manufacturing initiatives that you mentioned? When should we begin to see those offsetting the pressure? Michael Dale: Sure. So with respect to the product mix changes, that's an area in our own internal forecast. So we've always known, as I mentioned in my comments, that these businesses would be growing. But the gross margin plan assumed a relative constant in terms of the product mix between these. That's gotten ahead of us. It's driven by good news, i.e., breast adoption is going faster than we originally planned and assumed. But the result is that product mix reflects a higher relative cost and specifically for costing so our cost per millimeter is linear. What is not linear is our actual pricing model. And I've been aware of this for a while and I've held off making a decision. So that's my bad. And so that's one key element, which we will address in the future. The other one is just general efficiency initiatives in terms of production. And as with any supply chain, there's always something you can do more effectively. Given the nature of the supply chain, we won't go into the actual details, but we have a number of initiatives that we have very high confidence in, we'll address that. Looking ahead, the bottom line is how to model the business. We still believe 75% gross margin is the appropriate conservative number to look at overall. With regards to this year, however, the things that I've mentioned, there is not a mechanical element or a process that would allow us to implement these such that they would have effect in terms of the product going through and being recognized as sold for the remainder of this year, hence, the guide that we made. Gursimran Kaur: Got it. That's very helpful. And maybe just to bounce off of the prior question around guidance. Appreciate all the color on kind of how your expectations have changed versus the beginning of the year. But the guidance does imply that growth is around the 23%, which is essentially what you delivered here in Q2 for the second half of the year. So how are you thinking about durability of that momentum into the second half? And even just beyond as you continue to grow well above the 15% to 20% LRP, does that reinforce your confidence that you can sustain growth at the high end of that range over that framework? Michael Dale: Yes. So with regards to customer creation initiatives, virtually every initiative is at plan or exceeding plan and this reflects what we've largely assumed of course in terms of the opportunity for Axogen is that nerve care is dramatically undertreated, but there is interest in doing better in these particular areas, whether it be emergent or planned procedures. And so as long as we keep knocking on doors and providing in a competent professional way the service and support to do that, we remain very confident. Operator: Our next question is from the line of Mike Kratky with Leerink Partners. Michael Kratky: Congrats on the nice quarter. Maybe just one to start for me. In terms of the guidance, obviously a healthy raise here. You mentioned that it doesn't necessarily reflect any additional procedure growth from commercial wins we haven't seen yet. In terms of what you've started to build in from the ones that we have, can you just talk about the magnitude or help quantify that at all? Michael Dale: If I understand the question, you're asking about how do we quantify coverage and payment. Is that right, Mike? Michael Kratky: Yes. Basically just if you've started to build in some additional credit from some of the commercial reimbursement wins that you've seen already for the back half of this year? Michael Dale: We certainly know that there's been effect and the effect is that the sales cycle gets reduced primarily. You no longer have the objections, you no longer have to go through a process to overcome that kind of obstacle. But the magnitude of it is at a point yet where it's still difficult for us to actually put a number to or quantify it. And it goes back to prior comments we made is that we know these events are not light switches. I know people get tired of hearing that, but it really is not one. It's one that takes time to take root and that's what we're in the middle of. It's all getting better everywhere, but it's not fully in place. It's for the previous reasons that we've described. When these events take place, people need to be -- the approval of the extension of coverage needs to be socialized with both physicians as well as the institution. And then the institution, if they haven't already done so, need to negotiate their payment rates. And so that's why generally -- I'm generalizing here, maybe Rick can add to this. These are typically 6 months minimum cycles at which it takes in order to really enjoy the full benefit of that. Rick Ditto: Maybe to add a little color, Mike. We've been tracking this closely. As you can imagine, we get asked this frequently and I want to give my boss a good answer. What we see is a lot of our growth is driven by same-store sales or believers are adopting more thoroughly. And then there's sort of a long-tail distribution of new program starts. And so I know it was in our script and prepared remarks on number of surgeons and number of programs and you see good growth there. I wouldn't say that's added up to be a significant tailwind yet, but we're hopeful here in the back half and moving forward into '27. Michael Kratky: Understood. Yes, I really appreciate the color there. And then maybe a separate one on strategy. Taking a minority ownership stake in Trace Biosciences, would just love to hear your perspective in terms of why now external business development might have been the right fit for you. Michael Dale: Certainly. Timing is one of those elements of life which you need to be ready for. You can't always plan. And as we learned and we've been looking at this space for a while as core to our long-term strategic plan is that we innovate as defined by genuinely distinguished advantage based on benefit versus risk. And with one of the biggest challenges in nerve care is one, seeing the problem and then secondly, of course doing something about the problem. Both of those are difficult. It's easy to make that statement sounds very simple. But when you get into complexities and you actually look at these wound beds sometimes people are dealing with, it is remarkable how difficult it is to see what it is you're trying to address and understand. So enabling the ability to see a nerve is huge. And so what we have observed with Trace and have high hopes for is that they will be the technology that will give the first opportunity to genuinely illuminating these wound beds in these situations so that nerve care is simply easier to do and more effective as a result. Operator: The next questions are from the line of Caitlin Roberts with Canaccord. Caitlin Roberts: Congrats on the quarter. Just to start out, thanks for beginning to break out Breast and Avance within your revenue mix. Breast is driving about 2/3 of the growth in the Q2 you noted. What was the growth mix in prior quarters since you pointed out that the mix has really grown more to Breast relative to the other indications recently? And just given the updated guidance, how much of that growth and/or mix do you expect to be from Breast for the full year? Michael Dale: With regards to Breast, Breast has always had very high double-digit growth, but we're now reaching new levels is the best way to put it. And so looking forward while the growth with regards to OMF, Head and Neck and Extremities continues very nicely on this larger base, Breast is driving the most significant acceleration within the product mix. Caitlin Roberts: Got it. And then just any update on the Elevance gap length restriction and conversations to maybe remove those restrictions or maybe how -- any color on how restrictive this has actually been in practice for the policy? Michael Dale: I'll ask Rick to comment. Rick Ditto: Caitlin, thanks for the question. What I can tell you is the team at Elevance, we reached out and they were very willing to meet with us. So we educated them with a couple of world-leading surgeons from well-known institutions and we're hopeful this gets resolved sometime in the next 6 to 12 months, probably when they do the annual update next year. What I'll tell you is in practice, we don't hear about a lot of Elevance denials. So that's just a little bit of color. Our sales force is trained if they get a denial to give our team a call and we're not hearing a lot of it. Operator: The next questions are from the line of Anthony Petrone with Mizuho Group. Anthony Petrone: Congratulations on another strong quarter here. One on Breast and one on prostate for the team here. Maybe on Breast breaking out numbers here, hitting an inflection point. And I know some of the comments just a few moments ago were it's mostly same-store sales, but to a lesser extent, you're seeing traction from new accounts as well. But maybe applying those comments to the breast program here, you have 215 active programs and 560 surgeons. That's 150 new surgeons. So how much of that is same-store for Breast versus new account? And what do you think you can get in terms of total account penetration in Breast by the end of the year? And I'll have a quick follow-up on prostate. Michael Dale: Sure. Maybe I'll ask Jens to comment in terms of the actual breakout and I can give some larger color in terms of the futures here. Jens Schroeder Kemp: Yes. I think when you look at the Breast growth, we see both existing programs accelerating adoption. And within those programs, that's driven by existing surgeons, but we're also successfully activating new surgeons within these existing programs. So we do see a very healthy contribution from new surgeons, also new programs, and then we continue to grow our existing programs as well. So it's really nice growth across the entire customer cohort that we see. Michael Dale: A little background to build upon what Jens just shared, Anthony, is we now see a situation where we have people calling us asking for the opportunity to attend our programs. We also hear from physicians is how often patients now are bringing up resensation as an option for their reconstruction. So it's been a gradual change, but it's definitely a change that's underway. And to say it simply, any program or any physician within a program now feels that they need to know how to do this procedure and need to be able to offer this as an option in order to remain relevant. Anthony Petrone: That's helpful. And then a quick one on prostate here, just data coming second half of the year. Maybe if we can -- a little bit on some guideposts for what we should be expecting. I know the studies with radical prostatectomies. What should we be expecting in terms of the key endpoints just as some guardrails in terms of success factors? And when we think about prostate when we look ahead, is it specifically for just radical prostatectomy or all prostatectomy surgeries? Michael Dale: The initial data set that we will present on has been done within the constraint of robotic surgical interventions and these are radical prostatectomies that have been conducted. The patients all had prior function before their diagnosis and the intervention. And so we're looking at the ability to restore the function that they enjoyed before their procedure and it's done across a little over 100 centers, a little more than 100 patients. We have about half of those patients have more than 6 months of follow-up now. We're looking at both safety, reproducibility and the outcomes as measured by erectile function, time to restoration of function, quality of function and then the same with regards to incontinence. So in third quarter what we're still in the process of planning is the actual structure of our report, but we will have physicians involved who are key implanters who we'll invite so that you can speak to them directly. And they will provide their perspective on the relevance of the procedure and the feedback. All we can say at this stage is what we've been saying is that it's looking good, but it's appropriate that we wait for a little more follow-up on these patients so that there's no surprises. But trends at this point in time are positive. We're doing a lot of go-to-market planning, as you might expect, doing physician -- excuse me, patient preference studies. We completed 2 of those, remarkable feedback. So it's really driven by what Axogen has the opportunity to bring to the world in the way of a benefit versus risk proposition. We introduced essentially no risk. The risk is already incurred. And what we offer is the potential of mitigating the consequences of these interventions or these injuries. And we have a lot of experience in terms of the ability to provide a clinically meaningful benefit. And so when you think about the fact that you have to undergo one of these procedures, the ability to occur no risk, but to mitigate that and you can probably guess what the patient preference studies are suggesting. So if our data holds up and we'll certainly have that by Q3, I think it will be a very important part of our business in the future. Lindsey Hartley: And just to clarify one point that Mike mentioned was we have over 100 patients across more than 10 sites -- he actually said 100 sites. Operator: The next questions are from the line of Jayson Bedford with Raymond James. Jayson Bedford: Just 2 quick ones here. First off, I guess across the coverage across the sector in health care where there's been some mixed messaging on ACA dynamics. It doesn't seem, I guess, from your results that you're getting too much here given the strong growth. I'm just curious are you seeing an impact from some of these ACA dynamics? And how would you characterize the procedure environment now? And just thinking ahead in second half, fair to say that procedure demand is strong given the guide? Michael Dale: We have seen no impact of any kind with regards to the ACA dynamics. We're following the news, but it has had no effect on our business to our knowledge. Jayson Bedford: Okay. That's helpful. And then just a quick one, digging a little deeper on the Trace investment there. Is the idea here that it's kind of broadly applicable across your indications? Is this more for trauma and extremities where the wound bed is a little messier whereas like breast is cleaner given the elective nature? Kind of can you help us think about what this does for you on an indication basis? Michael Dale: Yes. The simple metaphor I would use is the rising tide. So it's going to help every procedure. It's akin to that of imaging and cardiology. In other words, you're just going to be able to see what it is you need to see in the first place today, but you're going to be able to see it more easily and more distinctly. And so this will enable nerve care very, very broadly. Operator: The next question is from the line of Frank Takkinen with Lake Street Capital. Frank Takkinen: I was going to continue on with some additional questions around the Breast business. What I'm really trying to get at is understanding really what inning we are in. I think back of the envelope math implies that we're maybe in the low to mid-teens percent penetrated into the market opportunity you lay out in Breast. But maybe a few metrics around what do you think the total program opportunity is? How many surgeons are out there that are doing these types of procedures? How many reps might you need to convert this opportunity? And then what are some of the big bottlenecks? And I'll stop at one question given they're multipart in there. Michael Dale: Sure. We're still in very early innings. It's just very important to appreciate. So the total number of sites to service is about 1,200. Now to whether all 1,200 someday will be developed, that's difficult to say. But the long and short of it is that the sites that are currently up represent only a small number of the potential market development opportunity that exists. We just had a surgeon visit just the other day, a very active busy person, and he reminded us that he still has a huge population that comes through and they don't know anything about breast resensation. They don't know about the consequences of their mastectomy and they certainly don't know anything about Axogen. And so I guess that's just why I keep repeating that we believe we have years ahead of us in terms of high growth potential as we develop these opportunities. Operator: Ladies and gentlemen, that concludes the question-and-answer session. I'll turn the floor back to Mr. Dale for any final comments. Michael Dale: Thank you, operator. On behalf of the Axogen team, I want to thank everyone for their time and interest in our work to fulfill the promise and potential for all stakeholders of our business purpose, which is to restore health and improve quality of life by making restoration and peripheral nerve function an expected standard of care. We look forward to updating you on our continued progress on our earnings call next quarter. Thank you very much. Operator: Thank you. That does conclude today's teleconference and webcast. You may disconnect your lines at this time and have a wonderful day. We thank you for your participation today. Before you buy stock in Axogen, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Axogen wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $397,405!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,344,091!* Now, it’s worth noting Stock Advisor’s total average return is 953% — a market-crushing outperformance compared to 214% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of August 7, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Axogen (AXGN) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

AxoGen (AXGN) came out with quarterly earnings of $0.12 per share, beating the Zacks Consensus Estimate of $0.09 per share. This compares to earnings of $0.12 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +33.33%. A quarter ago, it was expected that this regenerative medicine company would post earnings of $0.12 per share when it actually produced earnings of $0.07, delivering a surprise of -41.67%. Over the last four quarters, the company has surpassed consensus EPS estimates two times. AxoGen, which belongs to the Zacks Medical - Instruments industry, posted revenues of $69.73 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 4.31%. This compares to year-ago revenues of $56.66 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. AxoGen shares have added about 25.7% since the beginning of the year versus the S&P 500's gain of 8.5%. While AxoGen has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for AxoGen was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.15 on $70.25 million in revenues for the coming quarter and $0.49 on $271.08 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Medical - Instruments is currently in the bottom 39% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. One other stock from the same industry, SINTX TECHNOLOGIES, INC. (SINT), is yet to report results for the quarter ended June 2026. The results are expected to be released on August 11. This company is expected to post quarterly loss of $0.69 per share in its upcoming report, which represents a year-over-year change of +24.2%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. SINTX TECHNOLOGIES, INC.'s revenues are expected to be $0.4 million, up 166.7% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report AxoGen, Inc. (AXGN) : Free Stock Analysis Report SINTX TECHNOLOGIES, INC. (SINT) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

This article first appeared on GuruFocus. Release Date: July 29, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Axogen Inc (NASDAQ:AXGN) reported a 23% year-over-year revenue growth for the second quarter of 2026, reflecting strong demand across all target markets. The breast market showed particularly strong growth, contributing approximately two-thirds of the quarter's revenue growth. The company increased its revenue guidance for the remainder of the year, indicating confidence in its strategic priorities. Axogen Inc (NASDAQ:AXGN) ended the quarter with $113.4 million in cash equivalents, restricted cash, and investments, demonstrating strong financial health. The company's commercial expansion efforts have been successful, with a total of 172 sales representatives and market development managers, contributing to increased market penetration. Gross margin for the quarter was 72.7%, a decrease from 74.2% in the second quarter of 2025, primarily due to product mix changes. The company faced higher production costs due to the accelerated growth of the breast market, which relies on longer grafts with higher production costs. Operating expenses increased to $52.8 million in the second quarter, up from $40.3 million in the second quarter of 2025, driven by compensation costs and stock-based compensation expenses. Net loss for the second quarter was $1.5 million, or $0.03 per share, compared to net income of $0.6 million in the second quarter of 2025. The company is facing delays in obtaining coverage from Aetna, the largest commercial payer not yet covering its products, which could impact future revenue growth. Warning! GuruFocus has detected 2 Warning Sign with AXGN. Is AXGN fairly valued? Test your thesis with our free DCF calculator. Q: Can you provide more details on the growth in other markets besides breast for Q2? A: Michael Dale, CEO: While we are now breaking out breast separately, other markets like extremities, oral maxillofacial (OMF), and head and neck are also growing well. Extremities remain the largest, with OMF and head and neck being smaller but all markets are experiencing healthy growth. Q: What are the key assumptions for the raised guidance for the second half of the year? A: Michael Dale, CEO: The most significant factor is the investment in sales footprint coverage, which has been very rewarding. We are seeing high double-digit growth in response to expanding our sales coverage. Additionally, increased patient and surgeon awareness, especially in planned procedures like breast, is driving activity and adoption. Q: Any concerns about Aetna not updating their policy on Avance coverage? A: Michael Dale, CEO: We are disappointed that Aetna hasn't made a decision yet, but we know they are reviewing it. Rick, from the team, adds that the delay might mean they want to get it right, which is hopeful. Q: Can you explain the lower margin profile for breast and when we might see improvements? A: Lindsay Hartley, CFO: The lower margin is due to an error in our internal forecast regarding product mix changes. Breast adoption is faster than expected, leading to a higher relative cost. We plan to address this through pricing adjustments and production efficiency initiatives, but these won't impact this year's results. Q: How do you view the durability of growth momentum into the second half and beyond? A: Michael Dale, CEO: We are confident in sustaining growth at the high end of our 15-20% long-range plan. Most customer creation initiatives are at or exceeding plan, reflecting the significant opportunity in nerve care, which is dramatically undertreated. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Interested in AxoGen, Inc.? Here are five stocks we like better. Strong revenue growth: AxoGen’s second-quarter revenue rose 23.1% year over year to $69.7 million, driven largely by breast reconstruction. The company raised its 2026 revenue outlook to at least $279 million, or at least 24% growth. Breast reconstruction is becoming the primary growth engine: Breast revenue increased more than 50% in the second quarter, with about 215 active programs and 560 active surgeons by quarter-end. This growth pushed extremities revenue below half of total company sales for the first time. Product mix pressured margins: Gross margin fell to 72.7% from 74.2% because demand shifted toward higher-cost, longer Avance grafts. AxoGen lowered its 2026 gross-margin outlook to at least 73%, while pursuing pricing and manufacturing-efficiency measures. AxoGen (NASDAQ:AXGN) reported second-quarter 2026 revenue of $69.7 million, up 23.1% from a year earlier, as demand for its Avance nerve graft and broader product portfolio increased across its target markets. The company raised its full-year revenue outlook to at least $279 million, representing growth of at least 24%, while lowering its gross-margin expectation to at least 73% due to product-mix changes tied to faster-than-expected growth in breast reconstruction. President and Chief Executive Officer Michael Dale said the company exceeded its goals for surgeon adoption, new surgeon additions, account expansion and patient awareness. Breast reconstruction contributed about two-thirds of the company’s quarterly growth, while extremities, oral and maxillofacial, head and neck, and other indications delivered combined 15% growth in the first half. → This Tiny AI Supplier Could Be More Important Than the Chipmakers Breast revenue increased 47% year over year in the first half of 2026, according to Dale, supported by expanded sales capacity, surgeon training, coverage and payment progress, and increasing surgeon and patient awareness. Chief Financial Officer Lindsey Hartley said breast sales rose more than 50% year over year in the second quarter, causing extremities sales to account for less than half of total company revenue for the first time. AxoGen said it had about 215 active breast programs at the end of the quarter, more than 40 above the prior-year level, and approximately 560 active breast surgeons, an increase of more than 150 surgeons year over year. → Refiner Stocks Are Near Record Highs—Can Iran-Driven Margins Keep Them There? “We believe we’re still early in this market’s development, even as it becomes a larger part of our overall mix,” Dale said. He said the company sees growing interest from surgeons seeking training and from patients asking about its ReSensation offering during reconstruction discussions. The company’s commercial organization totaled 172 sales representatives, market development managers and regional directors at quarter-end. It added 15 positions year to date, including nine in extremities and six in breast. Dale said representatives who have been in their roles for fewer than nine months continued to contribute meaningfully to growth. → Innovative ETF Strategies That Are Paying Off This Summer Second-quarter gross profit was $50.7 million, producing a gross margin of 72.7%, compared with 74.2% in the prior-year quarter. Hartley said the decline reflected higher product costs, partially offset by lower write-offs. Management attributed the shortfall versus internal expectations primarily to sales of higher-cost biologic Avance products beginning in April and unexpectedly strong demand for longer-length Avance grafts. Demand for the longer grafts, largely associated with breast growth, exceeded the company’s internal expectation by about 14% during the quarter. Dale said the company’s production and gross-margin plans had anticipated breast growth but did not anticipate the magnitude of the relative shift in product mix. Longer grafts carry higher production costs, while pricing does not increase proportionally with length, he said. AxoGen has adjusted production plans beginning in the third quarter and plans to pursue pricing actions and production-efficiency initiatives. However, Dale said these measures will not materially affect the product mix forecast for the rest of 2026. The company expects third-quarter gross margin to be higher than fourth-quarter margin and said it still views 75% as an appropriate longer-term gross-margin target. Operating expenses increased to $52.8 million from $40.3 million a year earlier, driven primarily by compensation costs and stock-based compensation. Sales and marketing expense rose to 44.2% of revenue from 42.0%, reflecting investments in commercial expansion. Research and development expense increased 25.3% to $8.6 million, while general and administrative expense rose 38.4% to $13.4 million. The company reported a net loss of $1.5 million, or $0.03 per share, compared with net income of $0.6 million, or $0.01 per share, in the second quarter of 2025. Adjusted net income was $7.3 million, or $0.12 per share, compared with $5.7 million, or $0.12 per share, a year earlier. Adjusted EBITDA was $8.4 million, down from $9.3 million in the prior-year period. Revenue guidance: At least $279 million for 2026, representing growth of at least 24%. Gross-margin guidance: At least 73% for 2026. Cash position: $113.4 million in cash equivalents, restricted cash and investments as of June 30. Free cash flow: $4.1 million generated during the first half; management continues to expect positive free cash flow for the full year. Hartley said the outlook does not assume a material benefit from payer coverage decisions beyond those already known. Commercial payer coverage for Avance currently represents about 86% of covered U.S. lives, management said. Aetna remains the largest commercial payer that has not yet issued coverage, although AxoGen said Aetna’s review remains ongoing. AxoGen highlighted several clinical and development initiatives. The company said the recently published REPOSE study provided prospective, randomized evidence evaluating AxoGuard Nerve Cap as an adjunct to standard neurectomy for symptomatic neuroma. It also activated its first U.S. site for the Nerve-RESTORE trial, a randomized assessor-blinded study comparing Avance with sural nerve autograft in mixed and motor peripheral nerve reconstruction. Additional site activations are planned for the second half of 2026. The company said its Embrace study, evaluating sensory restoration after nipple-sparing mastectomy and implant-based breast reconstruction, remains on track to begin later this year. In addition, AxoGen acquired a minority ownership stake in Trace Biosciences, including a limited right of first refusal. Dale said Trace’s Nerve Trace imaging technology is intended to help surgeons visualize nerves in real time and could complement AxoGen’s nerve-repair products. He said the technology could support nerve care across the company’s procedural markets. For its prostate program, AxoGen said it expects to provide more detail during its third-quarter call. Dale said the company has enrolled more than 100 patients across more than 10 sites in its surgical experience program involving radical prostatectomy procedures, with about half of patients having more than six months of follow-up. Management said it is evaluating safety, reproducibility, erectile-function outcomes and incontinence outcomes. AxoGen, Inc is a Florida-based medical technology company that develops and commercializes surgical solutions for peripheral nerve damage. Founded in 2002 and headquartered in Alachua, Florida, the company focuses on restoring nerve function and improving patient outcomes through innovative biologic and engineered products. AxoGen's offerings address a range of traumatic and iatrogenic injuries, offering alternatives to traditional nerve autografts. The company's core product portfolio includes the Avance® Nerve Graft, a decellularized human nerve allograft designed to bridge nerve gaps without the need for a secondary harvest site, and the Axoguard® Nerve Connector and Protector devices, which facilitate nerve coaptation and protect repaired sites from surrounding scar tissue. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "AxoGen Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for July 2026.

Raises Full Year Revenue Guidance to at Least 24% Growth or $279 million ALACHUA, Fla. and TAMPA, Fla., July 29, 2026 (GLOBE NEWSWIRE) -- Axogen, Inc. (NASDAQ: AXGN), a global leader in developing and marketing innovative surgical solutions for the restoration of peripheral nerve function, today reported financial results and business highlights for the second quarter ended June 30, 2026. Second Quarter Financial Results Revenue was $69.7 million, an increase of 23.1% compared with $56.7 million in the second quarter of 2025. Gross margin was 72.7% compared to 74.2% in the second quarter of 2025. Gross margin performance was driven by changes in product mix caused primarily by accelerating year over year Breast growth greater than 50%. Net loss was $1.5 million, or $0.03 per share, compared to a Net income of $0.6 million, or $0.01 per share for the second quarter of 2025. Adjusted net income was $7.3 million, or $0.12 per share, as compared to $5.7 million, or $0.12 per share for the second quarter of 2025. Adjusted EBITDA was $8.4 million, compared to $9.3 million for the second quarter of 2025. Cash and cash equivalents, restricted cash, and investments as of June 30, 2026 was $113.4 million, as compared to $103.6 million as of March 31, 2026, an increase of $9.8 million. “We are pleased with our second-quarter revenue performance and the progress we’re making across each of Axogen’s strategic plan priorities,” said Michael Dale, President and CEO of Axogen, Inc. “Our strong growth across all our target markets, continues to reinforce the relevance of our market development strategies and the strength of our commercial execution. We remain well positioned to achieve our revenue guidance and continue advancing our strategic objectives for 2026.” Summary of Business Highlights Year-to-date revenue growth through the second quarter of 2026 was broad-based across Extremities, Oral Maxillofacial & Head and Neck, and Breast, driven by 20% plus year-over-year account productivity, expanding sales force coverage, and improving commercial insurance coverage and payment. Publication of REPOSE, a prospective, randomized clinical study evaluating Axoguard Nerve Cap for symptomatic neuroma management, providing Level 1 evidence supporting nerve end protection and demonstrating favorable outcomes in pain burden, medication utilization, and recovery-related measures. Initiated Nerve-RESTORE, a prospective, randomized, assessor-blinded study comparing Avance Nerve Graft to sural nerve autograft in mixed and motor nerve reconstruction, designed to generate Level 1 evidence supporting broader adoption of nerve repair globally. Acquired a minority ownership stake in Trace Biosciences, including a limited right of first refusal, to support development of its nerve-specific imaging technology. 2026 Financial Guidance For 2026, we expect full-year revenue growth to be at least 24%, or revenue of at least $279 million, gross margin to be at least 73%, and positive free cash flow for the full-year. Conference Call The Company will host a conference call and webcast for the investment community today at 8:00 a.m. ET. Investors interested in participating in the conference call by phone may do so by dialing toll free at (877) 407-0993 or use the direct dial-in number at (201) 689-8795. Those interested in listening to the conference call live via the internet may do so by visiting the Investors page of the Company’s website at www.axogeninc.com and clicking on the webcast link. Following the conference call, a replay will be available in the Investors section of the Company’s website at www.axogeninc.com under Investors. About Axogen Axogen (AXGN) is the leading company focused specifically on the science, development and commercialization of technologies for peripheral nerve regeneration and repair. Axogen employees are passionate about providing the opportunity to restore nerve function and quality of life for patients with peripheral nerve injuries by providing innovative, clinically proven and economically effective repair solutions for surgeons and healthcare providers. Peripheral nerves provide the pathways for both motor and sensory signals throughout the body. Every day people suffer traumatic injuries or undergo surgical procedures that impact the function of their peripheral nerves. Physical damage to a peripheral nerve or the inability to properly reconnect peripheral nerves can result in the loss of muscle or organ function, the loss of sensory feeling, or the initiation of pain. Axogen’s product portfolio includes Avance® (acellular nerve allograft-arwx), Avance® Nerve Graft, Axoguard Nerve Connector®, Axoguard Nerve Protector®, Axoguard HA+ Nerve Protector™, Axoguard Nerve Cap®, and Avive+ Soft Tissue Matrix™.​ For more information, visit www.axogeninc.com. Cautionary Statements Concerning Forward-Looking Statements This press release and accompanying earnings call contain “forward-looking” statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements under the heading “2026 Financial Guidance” and statements regarding our business model optimization plans; market development strategies and objectives; our strategic investments, including the expected benefits and opportunities of such investments; our expectations around the potential positive impact on our business of expanded coverage and reimbursement for peripheral nerve injuries using synthetic conduits or allografts; our ability to sustain growth, operate profitably, generate positive cash flows, and fund our market development initiatives. These statements are based on management’s current expectations and estimates of trends and economic factors in the markets in which we are active. Words such as “expects,” “anticipates,” “objectives,” “targets,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “projects,” “forecasts,” “continue,” “may,” “should,” “will,” and variations of such words and similar expressions are intended to identify such forward-looking statements. Actual results or events could differ materially from those described in any forward-looking statements as a result of factors, including, without limitation, disruptions from global supply chain issues, inflation, hospital staffing challenges, product development timelines, regulatory processes, financial performance, surgeon adoption rates, market awareness of our products, the estimated total addressable market, as well as those risk factors described under Part I, Item 1A, “Risk Factors,” in our most recent Annual Report on Form 10-K and other risks and uncertainties that may be detailed from time to time in reports filed by the Company with the SEC. Forward-looking statements are not a guarantee of future performance, and actual results may differ materially from those projected. Forward-looking statements speak only as of the date they are made and, except as required by applicable law, we assume no responsibility to publicly update or revise any forward-looking statements. About Non-GAAP Financial Measures To supplement our condensed consolidated financial statements, we use the non-GAAP financial measures of EBITDA, which measures earnings before interest, income taxes, depreciation and amortization, EBITDA margin, and Adjusted EBITDA, which further excludes non-cash stock-based compensation expense and the loss on extinguishment of debt, and Adjusted EBITDA margin. We also use the non-GAAP financial measures of Adjusted Net Income and Adjusted Net Income Per Common Share - diluted which excludes non-cash stock-based compensation expense and the loss on extinguishment of debt from Net (Loss) Income and Net (Loss) Income Per Common Share - diluted. Additionally, we use the non-GAAP financial measure of Free Cash Flow which consists of net cash provided by operating activities, less expenditures for property and equipment, and intangible assets. These non-GAAP measures are not based on any comprehensive set of accounting rules or principles and should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP and may be different from non-GAAP measures used by other companies. In addition, these non-GAAP measures should be read in conjunction with our financial statements prepared in accordance with GAAP. The reconciliations of the non-GAAP measures to the most directly comparable financial measures calculated and presented in accordance with GAAP should be carefully evaluated. We use these non-GAAP financial measures for financial and operational decision-making and as a means to evaluate period-to-period comparisons. We believe that these non-GAAP financial measures provide meaningful supplemental information regarding our performance and that both management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when planning, forecasting, and analyzing future periods. We believe these non-GAAP financial measures are useful to investors because (i) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making and (ii) they are used by our institutional investors and the analyst community to help them analyze the performance of our business. Contact:Axogen, [email protected] ​ __________(1) Due to a GAAP net loss, antidilutive securities are excluded from GAAP diluted weighted average common shares outstanding. However, considering the adjusted net income position, adjusted diluted weighted average common shares outstanding incorporates securities that would have been dilutive for GAAP. __________(1) Due to a GAAP net loss, antidilutive securities are excluded from GAAP diluted weighted average common shares outstanding. However, considering the adjusted net income position, adjusted diluted weighted average common shares outstanding incorporates securities that would have been dilutive for GAAP. __________(1) Due to a GAAP net loss, antidilutive securities are excluded from GAAP diluted weighted average common shares outstanding. However, considering the adjusted net income position, adjusted diluted weighted average common shares outstanding incorporates securities that would have been dilutive for GAAP.

Shareholders of Axogen, Inc. (NASDAQ:AXGN) will be pleased this week, given that the stock price is up 12% to US$41.77 following its latest first-quarter results. It looks like a positive result overall, with revenues of US$61m beating forecasts by 6.4%. Statutory losses of US$0.38 per share were roughly in line with what the analysts had forecast. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year. Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit. After the latest results, the nine analysts covering Axogen are now predicting revenues of US$270.9m in 2026. If met, this would reflect a decent 14% improvement in revenue compared to the last 12 months. Losses are predicted to fall substantially, shrinking 35% to US$0.39. Before this latest report, the consensus had been expecting revenues of US$265.9m and US$0.38 per share in losses. So it's pretty clear consensus is mixed on Axogen after the new consensus numbers; while the analysts held their revenue numbers steady, they also administered a pronounced increase to per-share loss expectations. See our latest analysis for Axogen Although the analysts are now forecasting higher losses, the average price target rose 23% to 41.22222, which could indicate that these losses are expected to be "one-off", or are not anticipated to have a longer-term impact on the business. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Axogen at US$55.00 per share, while the most bearish prices it at US$48.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Axogen is an easy business to forecast or the the analysts are all using similar assumptions. Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's clear from the latest estimates that Axogen's rate of growth is expected to accelerate meaningfully, with the forecast 19% annualised revenue growth to the end of 2026 noticeably faster than its historical growth of 14% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 7.9% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Axogen to grow faster than the wider industry. The most important thing to take away is that the analysts increased their loss per share estimates for next year. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time. Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Axogen analysts - going out to 2028, and you can see them free on our platform here. And what about risks? Every company has them, and we've spotted 1 warning sign for Axogen you should know about. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

MALVERN, Pa., April 30, 2026 (GLOBE NEWSWIRE) -- TELA Bio, Inc. (“TELA Bio”), a commercial-stage medical technology company focused on providing innovative soft-tissue reconstruction solutions, today announced a comprehensive board refreshment plan designed to support the Company’s next phase of commercial growth and operational excellence. In a unanimous decision by the current seven-member Board of Directors, four respected directors have agreed to step down following the Company’s 2026 Annual Meeting of Stockholders on June 9, 2026 (the “2026 Annual Meeting”), to make room for four new highly accomplished executives with deep expertise in medtech commercialization, financial strategy, venture capital, and corporate turnarounds. This refreshment reflects the Board’s strong commitment to positioning TELA Bio for long-term success. Departing Directors (effective at the conclusion of the 2026 Annual Meeting): Doug Evans, Chairman of the Board Kurt Azarbarzin Vince Burgess Federica O’Brien New Directors (effective immediately after the conclusion of the 2026 Annual Meeting): Joseph Capper will be nominated for election as a Class I director at the 2026 Annual Meeting and is expected to serve as Chair of the Board upon election Guy Nohra has been appointed as a Class II director Joseph Neels has been appointed as a Class III director Paul Thomas has been appointed as a Class III director William Plovanic and Betty Jo Rocchio, who recently joined the Board and whose terms are also expiring, will stand for election and continue to provide valuable continuity. Antony Koblish, CEO, will also remain on the board. “The Board and management team are fully aligned on this important refreshment,” said Antony Koblish, Co-Founder and Chief Executive Officer of TELA Bio. “We are extremely grateful to Doug, Vince, Kurt, and Freddi for their many contributions in building TELA Bio into a commercial-stage company with a strong foundation in soft-tissue reconstruction. Their leadership and dedication have been instrumental.” “We are excited to welcome this outstanding group of four prestigious leaders whose collective experience will be invaluable as we execute our commercial strategy, improve operational efficiency, and advance toward sustainable profitability and value creation for shareholders. This is a pivotal step forward for the Company.” The new directors bring extensive track records in scaling medtech companies, venture capital investment in life sciences, optimizing commercial organizations, and navigating complex financial and strategic transformations, expertise that directly aligns with TELA Bio’s current priorities. Preliminary First Quarter 2026 Revenue The Company also announced preliminary revenue for the first quarter of 2026 of approximately $19.0 million versus previously provided guidance of approximately $18.5 million. Full financial results for the quarter will be reported after the market close on May 12, 2026. The preliminary financial information presented in this press release is based on the Company’s current expectations and may be adjusted as a result of, among other things, the completion of the quarterly review and financial closing procedures. The preliminary financial information reflects management’s estimates and assumptions that are inherently subject to risks and uncertainties. The Company’s actual results may differ from these preliminary results and such differences may be material. The Company undertakes no obligation to update or supplement the information provided in this press release until the Company releases its financial statements for the three months ended March 31, 2026. About the Incoming Directors Joseph Capper A highly experienced and accomplished healthcare executive, Mr. Capper has nearly 30 years of experience in MedTech and Life Sciences leadership roles and a track record of substantial value creation. Mr. Capper has been CEO of MiMedx Group Inc. (NASDAQ: MDXG) since January 2023. Before that, he was CEO of BioTelemetry, Inc. (formerly NASDAQ: BEAT), from 2010 to 2021, guiding the company through a significant turn-around, which culminated in its acquisition by Royal Philips for $2.8 billion. Prior to BioTelemetry, he served as President and CEO of both Home Diagnostics and CCS Medical. Mr. Capper brings a wealth of commercial experience, having held several leadership roles earlier in his career during the decade he spent with Bayer AG. Additionally, he was an officer in the U.S. Navy serving with distinction as a naval aviator. Mr. Capper has served on the board of directors of Anika Therapeutics, Inc. (NASDAQ: ANIK), since May 2024. Mr. Capper received his undergraduate degree in Accounting from West Chester University and an MBA in International Finance from George Washington University. Guido Neels Mr. Neels joined EW Healthcare Partners (“EW”) in 2006 and is an Operating Partner. He currently serves on the Board of Directors of several companies, including Elutia Inc. (NASDAQ: ELUT), Impulse Dynamics, Corvista, Enercon Technologies, and Bioventus Inc. (NASDAQ: BVS). Prior to joining EW, Mr. Neels served as Chief Operating Officer of Guidant Corporation, a world leader in the development of cardiovascular medical products prior to the company’s acquisition for $25 billion. Mr. Neels was responsible for the global operations of Guidant’s four operating units, Cardiac Rhythm Management, Vascular Intervention, Cardiac Surgery, and Endovascular Solutions, including responsibility for worldwide sales operations, corporate communications, corporate marketing, investor relations, and government relations. He also served as Vice President of Global Marketing for Vascular Intervention and as Managing Director for German and Central European operations. Prior to joining Guidant, Mr. Neels held general management, sales, and marketing positions at Eli Lilly in the U.S. and Europe. Mr. Neels previously served on the board of directors of Axogen, Inc. (NASDAQ: AXGN) from August 2015 to June 2025. Mr. Neels holds a Business Engineering degree from the University of Leuven in Belgium and a Master of Business Administration from Stanford University. Guy Nohra Mr. Nohra is a co-founder of Alta Partners, and was also a partner at Burr, Egan, Deleage & Co., which he joined in 1989. Mr. Nohra has been involved in the funding and development of notable medical technology and life science companies including ATS Medical, Cutera, Innerdyne, R2 Technology, deCODE genetics, and Vesica. Previously, Mr. Nohra was Product Manager of Medical Products with Security Pacific Trading Corporation. He was responsible for a multi-million dollar product line and traveled extensively in Korea, Taiwan, Hong Kong, China, and Southeast Asia. Currently, Mr. Nohra serves on the board of directors Bioventus Inc. (NASDAQ: BVS). He previously served on the board of directors of AcelRx Pharmaceuticals (formerly NASDAQ: ACRX), Carbylan Biosurgery (formerly NASDAQ: CBYL), Vertiflex and was the Chairman of the board of directors of USGI Medical and served on the board of directors of the Medical Device Manufacturing Association. He was named to the Forbes “Midas List” of dealmakers in high-tech and life sciences in 2007. In 2016 Mr. Nohra cofounded Alta Life Sciences, a venture fund based in Barcelona. Mr. Nohra has also served as the President of the Silicon Valley chapter of The Leukemia and Lymphoma Society for two terms. He holds a Master of Business Administration from the University of Chicago and a Bachelor of Arts in History from Stanford University. Paul Thomas Mr. Thomas currently serves as the Chief Executive Officer and Co-Founder of Prominex, Inc., a company focused on the development of molecular diagnostic assays for point-of-care infectious disease testing, a position he has held since 2018. Mr. Thomas previously served as the Chief Executive Officer of Roka Bioscience, a molecular diagnostic company focused on pathogen testing, a position he held from 2009 until 2017. Before that, he served as Chairman and Chief Executive Officer of LifeCell Corporation (formerly NASDAQ: LIFC), a regenerative medicine company from 1998 until it was acquired by KCI in 2008 in a transaction valued at $1.8 billion. Mr. Thomas previously held various senior positions, including President of the Pharmaceutical Products Division, during his tenure of 15 years with Ohmeda, a world leader in inhalation anesthetics and acute care pharmaceuticals. Mr. Thomas has served on the board of directors of Axogen Corporation (NASDAQ: AXGN) since 2020. Mr. Thomas received his MBA degree from Columbia University Graduate School of Business and completed his postgraduate studies in Chemistry at the University of Georgia Graduate School of Arts and Science. He received his B.S. degree in Chemistry from St. Michael’s College in Vermont. About TELA Bio, Inc. TELA Bio, Inc. (NASDAQ: TELA) is a commercial-stage medical technology company focused on providing innovative technologies that optimize clinical outcomes by prioritizing the preservation and restoration of the patient’s own anatomy. The Company is committed to providing surgeons with advanced, economically effective soft-tissue reconstruction solutions that leverage the patient’s natural healing response while minimizing long-term exposure to permanent synthetic materials. For more information, visit www.telabio.com. Caution Regarding Forward-Looking Statements This press release contains forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Words such as “may,” “might,” “will,” “should,” “believe,” “expect,” “anticipate,” “estimate,” “continue,” “predict,” “forecast,” “project,” “plan,” “intend” or similar expressions, or statements regarding intent, belief, or current expectations, are forward-looking statements and reflect the current beliefs of TELA Bio’s management. These statements are not guarantees of future performance and are subject to certain risks, uncertainties, and other factors that could cause actual results and events to differ materially and adversely from those indicated by such forward-looking statements. These risks and uncertainties are described more fully in the “Risk Factors” section and elsewhere in our filings with the Securities and Exchange Commission and available at www.sec.gov, including in our Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. Any forward-looking statements that we make in this press release speak only as of the date of this press release, and TELA Bio assumes no obligation to update forward-looking statements whether as a result of new information, future events or otherwise after the date of this press release, except as required under applicable law. Investor Contact Louisa Smith [email protected]

Image source: The Motley Fool. Thursday, May 8, 2025 at 8 a.m. ET Chief Executive Officer and Director — Michael Dale Chief Financial Officer — Nir Naor Chief Marketing Officer — Jens Kemp Vice President, Market Access — Rick Ditto Operator: Good morning, everyone. Joining me on today's call is Michael Dale, Axogen's Chief Executive Officer and Director; and Nir Naor, Chief Financial Officer; and Jens Kemp, Chief Marketing Officer. Michael will discuss first quarter 2025 financial results and corporate highlights. Nir will then provide an analysis of our financial performance and guidance and discuss our outlook for the year, followed by a question-and-answer session. Today's call is being broadcast live via webcast, which is available on the Investors section of Axogen's website. Following the end of the live call, a replay will be available in the Investors section of the company's website at www.axogeninc.com. Before we get started, I'd like to remind you that during the conference call, the company will make projections and forward-looking statements. Forward-looking statements, which are usually identified by the use of words such as objectives, targets, will, believe, expect, estimate, should, guidance, intend, projects or other similar phrases include, but are not limited to, statements relating to financial guidance, including revenue, margins, cash flow, future profitability, expectations for growth, estimated market opportunities, , timing for future product and application launches, and the company's expectations for approval of the biological license application of Avance Nerve Graft, including the anticipated timing of approval and the assumption that Avance Nerve Graft will be designated as a reference product for any future biosimilar nerve graft and that such designation will provide marketplace exclusivity. Forward-looking statements are based on current beliefs and assumptions and are not guarantees of future performance and are subject to risks and uncertainties, including, without limitation, the risks and uncertainties reflected in the company's SEC filings, including its Form 10-K and 10-Q. The forward-looking statements are representative only as of the date that they are made. And except as required by applicable law, the company assumes no responsibility to publicly update or revise any forward-looking statements. In addition, for a reconciliation of non-GAAP measures, please refer to today's press release and the corporate presentation on the Investors section of the company's website. Now, I'll turn the call over to Michael. Michael Dale: As you know, we announced a leadership transition this morning with Nir Naor stepping down as Chief Financial Officer. We want to thank Nir for his contributions to the company and wish him all the best in his future endeavors. I'm delighted to announce that succeeding Nir will be Lindsey Hartley. Lindsey will formally assume her new responsibilities as Chief Financial Officer on May 12th. Lindsey has served as Vice President and Corporate Controller at Axogen since 2021 and brings a wealth of experience and we are confident in her ability to lead our financial operations. Nir will remain in an advisory capacity through July 1, 2025 to ensure a smooth transition of responsibilities. I will begin today's call with a financial and corporate overview, highlighting our progress to date against plans for the business through the quarter, which will include the quarterly key performance indicators relevant to our growth strategies for each of the four markets as identified at our March 4th Investor Day. In addition, I will provide an update on the biologic license approval often referred to as the BLA process for our Avance Nerve Graft. I will then turn the call over to Nir who will provide a summary of the quarter's financials and update on full year 2025 guidance for the business. So how did we do for the quarter? I'm pleased to report we kicked off the year with broad-based growth across our entire portfolio to include double-digit growth performance in all markets. This growth was driven in each instance by good overall execution of the customer creation initiatives we described during our March Investor Day, generating continued adoption of our nerve repair algorithm in the high-potential accounts central to our growth strategies. Said in another way perhaps more simply, we are focusing our customer-facing sales and clinical resources on the highest potential hospital providers and physicians to maximize our ability to teach and establish nerve care as an expectation as part of their patient care. This basic strategy continues to show promise in the form of increasing productivity per headcount and account. Progress with our strategic work to develop additional clinical evidence, societal support, coverage and payment, and new product research and development will naturally leverage and further improve our objective to make nerve care, standard of care for all patients. Revenue in our first quarter increased to $48.6 million, up 17.4% compared to last year, driven by continued adoption of Axogen's nerve repair algorithm across each of our target markets and applications including extremities, oral maxillofacial in head and neck and breast. Per our plan for 2025, we started the work to expand our commercial infrastructure during the quarter, completing multiple strategic hires across our sales, marketing and market access teams to strengthen our capabilities and capacity. As we mentioned at our Investor Day last quarter, we will begin disclosing specific key performance indicators to help everyone better understand and measure our progress against plans and their relationships to growth. We will begin providing updates on these KPIs during each quarterly earnings release, starting today. These KPIs describe performance or progress across the following areas: high-potential accounts, commercial infrastructure, professional education and societal support, and prostate market development preparations. I'll begin with an update on our performance and growth in high-potential accounts. As a reminder, high-potential accounts are primarily characterized by the following criteria. Larger hospitals, including Level I trauma centers and/or academic-affiliated hospitals with a high number of nerve repair procedures, and already trained microsurgeons. As of the end of the first quarter, we are on track relative to our productivity targets in high-potential accounts. As we said during our Investor Day, we are targeting to generate approximately 66% of our growth in 2025 from high-potential accounts. In the first quarter, we exceeded this target, driven by an increase in average account productivity of 24% versus our plan of 21%. As a reminder, we have identified approximately 780 accounts that meet high-potential criteria. Average account productivity is the average revenue generated per high-potential account. The first quarter had 566 active high-potential accounts, which represents an increase of 5% versus the first quarter of 2024. Next, I will provide updates on the expansion of our commercial infrastructure and professional education initiatives, by market. Beginning with extremities, we enjoyed double-digit growth during the quarter and continued adoption of our nerve protection portfolio in both trauma and chronic nerve injury procedures. Our plans to expand our customer-facing field footprint in extremities and raise awareness of the need to treat non-transected nerve injuries include adding five additional sales representatives in high-potential territories in 2025. We intend to add these territories before the end of the third quarter. Key extremities market development activity during the quarter included the completion of one of the Upper Extremity Professional Education Fellows Programs, involving 30 surgeons. For 2025, we intend to conduct at least four Upper Extremity Fellows Programs, three attending physician-level programs, and train at least 105 surgeons. We also completed one International Extremity-focused Professional Education Program in Spain, involving 22 surgeons. In breast, we continue to experience double-digit growth in new customer creation from the adoption of our Resensation technique, in implant-based breast reconstruction procedures. Regarding our plans to expand our customer-facing footprint from 12 to 22 sales specialists in 2025, we have initiated the recruitment and hiring process and expect to complete the expansion of the sales team before the end of the third quarter. We ended the first quarter with one regional sales director and 13 Breast Resensation sales specialists trained in territories. Although we made good progress generating a significant talent pool for expansion of the sales team, we are running behind our original hiring and training plan, but we believe we will be on track by the end of the second quarter. We also executed on two professional education programs and trained 35 surgeon pairs and are on track to complete five national programs, and train 75 surgical pairs by year-end. We finished the first quarter with 119 active Breast Resensation programs, which represents, an increase of 4% versus the first quarter of 2024. Each program has multiple hospital accounts. And we are working to increase adoption in these accounts. In the first quarter, we had 229 active accounts, which represents, an increase of 6% over 2024. We had an estimated 254 surgeons who performed a Breast Resensation procedure in the first quarter, which represents a 16% increase versus the first quarter of 2024. In our Oral & Maxillofacial and Head & Neck markets, we saw strong continued momentum and growth from the adoption of our nerve algorithm and mandible reconstruction procedures, as well as other head and neck procedures. To accelerate growth in mandible reconstruction, increase our brand awareness, and key opinion leader engagement in head and neck, we have started the hiring process to add the planned five field-based market development managers and expect to complete hiring by the end of the second quarter. We also conducted one professional education fellows training program, where we trained 26 surgeons, and we are on track to conduct two more professional education programs and train at least 45 surgeons by year-end. Finally, an update on the Prostate, our prostate clinical and market development plan is on track, and we are excited about the opportunity to improve nerve function outcomes in Robotic-Assisted Radical Prostatectomies. In the first quarter, we hired a new Director of Marketing, and are in the process of hiring a clinical support team. Our initial focus is on surgical technique development and onboarding sites for our clinical development pilot. The clinical pilot will support the development of a scalable training and education program by the end of the third quarter. We expect to be able to meet the goal of having 10 pilot sites running by the end of the year. We have confirmed three clinical pilot sites and are in advanced discussions with other sites. We have already started to support cases in our pilot sites. We recently attended the American Urological Association Conference in Las Vegas, where we had an opportunity to get an update on the latest developments in Robotic-Assisted Radical Prostatectomy and unmet clinical needs. Nerve injury-related outcomes continue to be a significant challenge and we believe Axogen is well-positioned to address these challenges in a clinical meaningful way with our portfolio. We also had an opportunity to engage with multiple globally recognized key opinion leaders during the quarter and can report that there is high interest in partnering with Axogen to address the challenge of nerve-related injuries in prostatectomy. As a reminder, we have KPIs related to advancing our clinical research priorities. For breast neurotization, we are advancing efforts on the design of our Level 1 study protocol and are in detailed discussions with health economics and outcomes research and surgeon advisers on the study design and expect to complete the protocol design by year-end. In extremities, we are on track to complete the study design for a comparative Level 1 study of Avance Nerve Graft versus autograft in mixed and motor nerves by year-end. In addition, we are on track to develop our clinical evidence plan for oral maxillofacial in the head and neck by year-end. In the first quarter, we continue to see strong external validation of Axogen's differentiated technologies and leadership in peripheral nerve repair with eight new peer-reviewed publications citing clinical use or discussion of our products. For those interested these peer-reviewed studies are available on our website. This growing body of literature supports surgeon confidence in adopting our technologies and aligns with our strategic objective of becoming a standard of care option. Consistent with our Investor Day comments and aligned with our product development strategy, we continue to make meaningful progress across our three core innovation pillars. We advanced our therapeutic reconstruction program, focused on enhancing overall functional recovery following nerve repair. Our easy coaptation initiatives progressed towards developing milestones aimed at simplifying nerve coaptation and making it more predictable for surgeons. And finally, as part of our protection expansion efforts we initiated early-stage preclinical design work exploring our next-generation new applications for our protection technologies. From a development perspective, we're actively progressing all product and application initiatives outlined in our 2025 innovation road map. Finally, I would like to address the status of our biologics license approval often referred to as BLA for Avance Nerve Graft. The BLA remains on track and continues to progress as planned. We held a mid-cycle meeting with the FDA in March and have our late-cycle meeting with the agency scheduled for later this month. We are pleased to report successful clinical trial site inspections as well as a successful sponsor inspection of Axogen under the FDA's Bioresearch Monitoring, also known as BIMO program. These important regulatory milestones further reinforce our confidence in the strength and completeness of our BLA submission and align with prior guidance that we expect BLA approval in September. Overall, Axogen is excited to reach this next milestone with BLA approval, securing 12 years of market exclusivity with respect to biosimilar nerve allografts and establishing Avance Nerve Graft as the only implantable biologic indicated for the repair of functional deficits in peripheral nerves. I will now hand over the call to Nir to discuss the financials and our guidance. Nir? Nir Naor: Thanks, Mike. For this quarter our revenue reached $48.6 million representing 17.4% growth from the first quarter of 2024. This growth is attributed to an approximately 14% in unit volume and mix and a 3% increase in price. Our gross profit for the quarter was $34.9 million, an increase from the $32.6 million recorded in the first quarter of 2024. This represents a gross margin of approximately 71.9%, down from 78.8% in the same period last year. The year-over-year decline was driven by two factors. The first was the year-over-year impact from a growing proportion of Avance sold, which was processed at a higher cost at our new facility in Dayton, Ohio. We expect that the Avance cost of goods will reduce over time as capacity utilization increases and as we start recognizing additional efficiencies following planned process improvements. The second impact on the gross margin this quarter was due to increased inventory reserves and related write-offs. Looking beyond this quarter as we progress through the BLA process, which is not expected to conclude before September, our ability to make significant improvements to our processes and procedures is limited. Once we receive approval, we will be able to implement continuous process and quality system improvement, which we expect to positively impact our gross margin. Our total operating expenses for the quarter decreased to $36.6 million, down slightly from $37.2 million in the first quarter of 2024. Sales and marketing expenses as a percentage of total revenue decreased to 43.3% from 47.9% in the first quarter of 2024 as we saw an increase in our sales productivity and solid execution of our strategy focusing on high-potential accounts. Research and development expenses decreased by 17.8% to $6.1 million from $7.4 million in 2024 driven primarily by the completion of the development of Avive+ soft tissue matrix in Q1 of 2024 as well as by a reduction of clinical trial expenses. As a percentage of total revenues, total R&D expenses were 12.5% down from 17.9% in the first quarter of the prior year. General and administrative expenses were $9.5 million in Q1 of 2025 down 5% from the $10 million in Q1 of 2024. This quarter ended with a net loss of $3.8 million or $0.08 per share compared to a net loss of $6.6 million or $0.15 per share in the first quarter of 2024. Adjusted net loss for the quarter was $0.9 million or $0.02 per share compared to an adjusted net loss of $2.7 million or $0.06 per share in the first quarter of 2024. Adjusted first quarter EBITDA was $2.9 million compared to an adjusted EBITDA of $1 million in the prior year. As a reminder, Axogen's definition for adjusted EBITDA is EBITDA excluding stock-based compensation. As of March 31 our balance of cash, cash equivalents and investments was $28.1 million compared with $39.5 million at the end of the fourth quarter. Turning now to our guidance. We are maintaining our full year 2025 revenue growth guidance in the range of 15% to 17%. In addition, we continue to expect the full year 2025 gross margin to be in the range of 73% to 75%. As a reminder this includes approximately $2 million in one-off costs related to the BLA approval which would impact full-year gross margin by approximately one percentage point. The timing of most of those costs would be around the anticipated BLA approval date currently expected to be in September. Notably, we estimate that two-thirds of those costs are non-cash related and pertain to the vesting of our BLA-related stock compensation. From a cash perspective, we continue to expect to be cash flow positive for the entire year and expect to self-fund our new strategic plan with cash from operations. In summary, we're pleased with our first quarter performance. We will continue to execute our strategies invest in innovation improve our resource allocation and strive towards greater bottom-line profitability. And now we'd like to open the line for questions. Operator: Thank you. We will now be conducing a question-and-answer session. [Operator Instructions] Our first question comes from the line of Michael Sarcone with Jefferies. Please proceed with your question. Michael Sarcone: Good morning and thanks for taking our question. Also Nir it's been great working with you and best of luck on your new opportunity. Nir Naor: Thank you. Michael Sarcone: Just wanted to start maybe around Avance and the BLA approval. Great to hear that everything is tracking to plan. I did want to know right now I guess you sell that product as regulated as a regulated tissue-based product but you're working to get this biologics license application. I was wondering if you had any insight into the different customer accounts. Once this product gets approved as a biologic do accounts have to go through another VAC process or a recertification to recertify the product as a new category before they can continue to use it? Would love to get any sense of what you found there and what you're expecting. Michael Dale: Sure. Mike I'm going to ask Jens to respond to that. It's clearly a question that we've anticipated and I think we're ready for it. But Jens go ahead. Jens Kemp: Yes. Thanks, Mike. So based on our research to date and conversations with customers we do not expect any major changes to ordering or shipment for Avance storage of Avance or the reimbursement pathway. As an implantable biologic with an already established CPT one code the reimbursement pathway will remain unchanged and we will continue to be reimbursed as an implant using CPT code 64912. While some institutions may require approval from P&T committees Axogen does not anticipate any major disruptions to hospital access or product availability. Michael Sarcone: Got it. That’s very helpful. Thank you. And then maybe one for Nir. Just on the gross margin well below what we were expecting. Just wanted to get a sense of how severe the one-time inventory write-offs are. And then you are maintaining your gross margin guidance. Just wanted to get a sense of whether we see a full rebound in 2Q? Would love to get a sense for the cadence of gross margin through the rest of the year. Nir Naor: Yes. So yes, we don't break out the exact impact of those write-offs. But yes they were significant for Q1. They were also driven by various process improvements that we were making to allow us better and earlier detection of the need for such write-offs. So we definitely expect to improve in the course of the year. In addition to that, as we mentioned, gross margin is also supposed to be impacted by process improvements which we intend to put in place after the BLA. Regarding cadence, yes, we do expect it to improve subject to what we said before regarding the BLA-related expenses to hit in Q3. So that is basically the guidance. So yes, we do expect to improve with those around $2 million of one-off BLA approval-related expenses in Q3. Michael Sarcone: Got it. And sorry just to sneak one more follow-up in there, Nir. I mean how quickly, do you think those process improvements could take place following the BLA approval? Just really trying to get a sense for how much of a step-up we could see in 4Q after the BLA approval? Michael Dale: It won't be a stepwise improvement, Michael. It will be through the next 12 months thereafter. More or less, I'm oversimplifying a complex situation but the BLA is moving from one quality and operating system to another. It's the same product the day before and the day after this event transpires but the quality systems are different. And we are in a position now where we're navigating to an approval of an existing quality system and significant changes in operations systems and quality systems can't change as part of the normal course of continuous improvement between now and then. And so anything we want to do based upon looking at workflow and natural efficiency improvements unfortunately can't really take place until after we close the chapter on the approval of the plan. Michael Sarcone: Got it. Thanks, Michael. Michael Dale: [indiscernible] part of the gross margin for this year is that we knew it would be noisy as we ramped production and went through the inventories that we initially started the plant with as well as identified work process improvements. Michael Sarcone: Great. Thank you. Michael Dale: Sure. Operator: Thank you. Our next question comes from the line of Caitlin Cronin with Canaccord. Please proceed with your question. Caitlin Cronin: Hi. Thanks for taking the questions and wish you the best. Just to jump off that last question talking about the process the validation changes with the BLA. So if Avance is approved, can you still sell through current inventory levels if that inventory didn't necessarily go through that specific new validation process? Michael Dale: Yes, we can. So the simple answer is yes. So as part of the approval process, the existing inventories that were produced under the tissue designation will still be available for sale. Caitlin Cronin: That’s great. And then just with the moving parts with the BLA and also the new segment initiatives, just the cadence of OpEx for this year? Nir Naor: So I would say two trends. Number one, as we mentioned as part of our strategic plan, we have already started to invest in hiring and other investments throughout the year. So OpEx is expected to grow gradually pursuant to that. That said, again as we mentioned in the past, once we pass the BLA, there are some costs that are expected to roll off. Again, BLA as of September of this year. Caitlin Cronin: Great. And then just one more. I appreciate the team-specific updates. Just an update overall on where you are now from a sales team standpoint in terms of count and then where you plan to be by the end of the year, just broadly across all different call points and segments. Michael Dale: Yes. In terms of true salespeople in territories, by the end of the year, we should have approximately net 20. In addition to that, there are various marketing support staff, clinical staff, they’re also added -- who will be added during that time frame. But in terms of true actual sales territory expansions, it will be approximately 20 by the end of the year. Caitlin Cronin: Great. And where did you begin the year with? Nir Naor: I have to confess Caitlin. I don't have that number off the top of my head. Caitlin Cronin: Okay. No problem. That’s it for me. Thanks so much. Nir Naor: Thanks Caitlin. Operator: Thank you. Our next question comes from the line of Chris Pasquale with Nephron Research LLC. Please proceed with your question. Chris Pasquale: Thanks. I wanted to ask about the high-potential account's initiative. If I heard correctly, you think there are about 780 of those nationwide and 566 were active in 1Q. Would just love to know where you stand with the other 215 or so? Are those accounts that you don't have a relationship with today? Or are they just ordering sporadically? And part of the goal here is to get them to a consistent cadence of reordering where they would be considered active in each period. Michael Dale: Great question. So it's actually a mix. So we do have accounts that have different ordering patterns. So not all of our high-potential accounts order each month or each quarter. So, we do have on an annual basis, more active high-potential accounts than the 566. But we also do have accounts that we are not currently present in, and we see that as a great opportunity to continue to expand our presence in this cohort. So there's plenty of opportunity to expand within our existing customer base, and there are still high-potential accounts where we need to establish a footprint. Chris Pasquale: Great. And then I think the leaning in on clinical data is a really interesting and I think important part of the strategy here. You talked about wanting to run another comparative study of Avance to autograft in the core extremities segment. The trial to support the BLA submission took a long time to enroll. I'm curious one, your view on the need for a second randomized study in that indication? Or is this trial answering a different question? And then the feasibility of completing that work in a timely fashion given the history here? Michael Dale: Yeah. Fair questions, Chris. The mixed motor trial against autograft that is different than what was done with RECON specifically. So it's intended to answer that question narrowly. We enter from a planning standpoint we don't believe that it would take as long to enroll as some of the historic studies. We look at this in terms of trial recruitment and in terms of patient recruitment and enrollment, something that should transpire over a period of a year and then followed by the follow-up. So these are still two to three year programs at minimum in terms of activity. But that's what's required to complete these Class 1 evidence data sets. So I hope that answers your question. We feel pretty good that we can do this. Chris Pasquale: Yeah. That's great. Thanks, Michael. Operator: Thank you. Our next question comes from the line of Dave Turkaly with Citizens. Please proceed with your question. Dave Turkaly: Hey, good morning, and good luck, Nir. Mike, I know you've had some track record with some really differentiated technologies in the space, and Axogen's got a history of nice price increases. I think you called out 3%. I was curious, how sustainable do you think that is, looking back at some of your prior companies and then comparing it to this? Do you think that's a consistent factor moving forward? Michael Dale: It's a fair question. I don't have a specific answer. What I can tell you, we evaluate it on an annual basis. And to your question, I think there will be a point at which that may not be, but we don't have a date for that. We do not have a specific plan assumption at the moment. So regrettably, I don't have a perfect answer for you. Dave Turkaly: And you did say a lot, so thanks for all the details. When you look at all the clinical efforts you have ongoing, I guess, I don't know outside of obviously, your BLA and maybe this new mixed nerve, but would you look at any of them to call out that could have maybe the most near-term impact on, let's say, maybe even your financial results? Michael Dale: Fortunately, these studies do not incur costs like those for example purposes, like that of structural heart, for example, so it's one of the reasons why we are able to guide that we believe over the course of the strategic plan that we'll be able to fund all of our operations. So, hope that answers. If your question is about cost, can we actually afford to do this? The simple answer is yes. We believe we can. Strategically, we believe this evidence generation is necessary. We have a lot of clinical experience, a lot of individual paper publications, and a lot of individual surgeon and hospital experience. But fundamental Level 1, evidence needs to be increased because, outside of RECON and one other study over the years we haven't engaged in other studies. And so, with our new plan, what we identified as gaps and opportunities was to do that, and that's what we're going to do. We think it will be exciting for our customers. These are partnerships. Many of these individuals are physician-scientists and while they may believe in something, the more evidence we can add to that equation, the better. And then finally, of course, as everyone can appreciate in our world, it goes directly to the heart of coverage and payment. And so if we don't start this stuff, it never gets done. And bottom line, we're going to get it done. Dave Turkaly: Thank you. Operator: Thank you. Our next question comes from the line of Mike Kratky with Leerink Partners. Please proceed with your question. Unidentified Analyst: Hi, guys. This is Brett on for Mike. Thanks for taking the question. And, Nir, best of luck to you in your next role. It's been great working with you so far. So I want to go back to breast. You obviously mentioned that the hiring and sales specialists are running a bit behind plan. Obviously, this is one of your fastest-growing segments. So I just want to get a sense of whether there's anything contemplated within the original guide for breast, and if that was reliant on the pacing of that hiring? And then obviously, if anything has shifted with the delay? Michael Dale: We still believe that we'll be able to catch up on time in terms of that footprint. Now, to be very blunt, if we don't, which I don't expect to be the case. But if we didn't, yes, that would affect absolutely the cadence of the market development. So I hope that answers the question. Bottom line, we will be on track by the end of this quarter. Unidentified Analyst: Understood. Yes, that's helpful. And just one more on prostate. Obviously, you said the pilot there is launching in 3Q, but it seems to imply that a lot of that pilot will be in 4Q, at least the ramp to 10. So is there anything, again, similar line of questioning implied within the guide for 4Q that is factoring that in? Obviously, probably a smaller portion of revenue, but just the extent to which the guide relies on that pilot. Michael Dale: Yes. The guide does not rely on prostate market development from a revenue standpoint. We're doing our best to go slow with prostate just to make sure that we -- I mean, there's tremendous enthusiasm, but we want to make sure that, that enthusiasm is channeled into a standardized surgical approach so that the outcomes that we generate, we can make and draw conclusions from in terms of how to go forward with market development because we also intend to run clinical studies in prostate as well next year. And so hopefully, that answered the question. So there's lots of interest. That's the easy part. The hard part, the real work, is making sure that we develop surgical approaches that are teachable so that we can draw conclusions from the clinical outcomes and then, very importantly, engage in level oneevidence. Unidentified Analyst: Understood. Thanks guys. Michael Dale: Sure. Operator: Thank you. Our next question comes from the line of Ross Osborn with Cantor Fitzgerald. Matt Park: Hi, guys. This is Matt Park on for Ross today. Thanks for taking the questions. Going back to a question asked earlier on reimbursement. I guess, outside of continued evidence generation, are there specific commercial payer targets or policy barriers you're looking to address this year? Michael Dale: Sure. I will ask Rick Ditto, who now leads that part of our program, and he can speak to his impressions. Rick Ditto: Thanks for the question. Yes, following the BLA, we're working with evidence intermediaries. These are the health benefit managers and groups that summarize evidence for payers. And we'll start in Q4, tackling some of the regional non-coverage policies that are out there for Avance Nerve Graft. And then as we develop a winning formula, we'll start tackling the national payers next year. Matt Park: Got it. That's helpful. And then just one more for me on OMF and head and neck. You cited continued strong momentum here. Are there specific referral pathways or procedure types that are helping drive the strong performance? And then how do you see this growth in this segment trending relative to extremities and breast as you continue to penetrate the market here? Thanks. Jens Kemp: Yes. Thanks for the question. Yes. So the focus is on driving growth in mandible reconstruction procedures. We have a very good position in benign mandible reconstruction procedures and are making inroads with malignant pathology as well. So the primary growth driver is mandible reconstruction. But then, as we start engaging more with head and neck surgeons, there are multiple other procedures that we're targeting, including radical neck dissections and parotidectomies. So there's a lot of opportunity in the head and neck space, and that's why we're adding 5 field-based market development managers to really accelerate brand awareness and adoption with that surgeon group. Nir Naor: I know we've talked about it in the past, but just to build upon Jens's comments, it's still a not uncommon, not infrequent situation where we meet the specialists within these various centers who are either unaware of Axogen and as a result, don't appreciate that the alternatives even exist. So this is still a very immature market development, and therein lies the opportunity. Matt Park: Super helpful color. Thanks for taking my questions. Operator: Thank you. Our next question comes from the line of Jayson Bedford with Raymond James. Please proceed with your question. Jayson Bedford: Good morning. So a few questions. On gross margin, you came in a bit below our estimate for the quarter. I'm guessing you came in a bit lower than your internal, maybe not. You still have the onetime costs related to the BLA that will hit in the third quarter. So, by maintaining the guide, it implies a higher exit rate. So, is it fair to assume that you exit 2025 north of 75% on the gross margin line? Michael Dale: You mean in Q4, Jayson? Jayson Bedford: Q4. Correct. Michael Dale: Yeah. Well, one, we don't give quarter-to-quarter guidance. And I don't want to do that. But no, I would think that would be too high. Nir Naor: Yeah. I would say, Jayson, in general, yes, we do expect, --- as I think I answered to one of the other analysts, the other quarters to be higher than Q1, again subject to those one-off BLA approval-related costs in Q3. Jayson Bedford: Okay. Maybe just on the top line, I'll ask the high potential account question a little differently. Have you seen much of a drop-off in those accounts that are not high potential? Meaning, I think there's a few hundred accounts out there that aren't necessarily a focus. But have you seen the business with those accounts fall off at all? Michael Dale: Well, our focus is on these accounts. So, by definition, yes, because technically we have touched more than 3,000 accounts over recent years. And I use the word "touch" because you're in and out. And you're not maintaining constant market development and physician development in those accounts. So, yes, we have some accounts which have done nothing beyond that original experience. And it's because we've moved all of our resources towards these accounts. That doesn't mean we never step outside of a high potential account. But fundamentally, the focus has been reframed, and the expectations are to build recurring, enduring revenue in these accounts. So, it's a long-winded way of saying, yes, there are places that have not done an action procedure, because we don't go there any longer. It's a resource allocation question, and this is the decision that we believe is best for driving growth in standard of care. Jayson Bedford: Okay. Okay. That's helpful. Michael Dale: We had 600 people. It would be a very different equation. But just to be clear about why we're doing this is those individuals, in terms of time and duration working with a physician, have to make choices. And so, the high potential account is what we think is most practical. Jayson Bedford: No, the strategy makes sense. I'm just looking at it -- you grew well, right. 17% is quite strong, and either it's the high potential accounts doing really, really well, or the non-high potential actually hanging in there, a bit better than maybe expected. That was kind of the genesis of the question. Michael Dale: You got it. Jayson Bedford: Thank you. Michael Dale: Thanks Jayson. Operator: Thank you. Our next question comes from the line of Frank Takkinen with Lake Street Capital Markets. Please proceed with your questions. Frank Takkinen: All right. Thanks for taking my questions. Congrats on the first quarter. I was hoping to start with one—just growth rates across businesses. I know you're not going to disclose too much specifics, but my assumption is some of the businesses grew faster than 17%, and then maybe some were still in the double-digits, but below that 17% rate. Any kind of goalposts, you can provide on growth rates between breast, OMF, and extremities? Michael Dale: Yeah. A fair question, Frank, but we don't want to get into that level of detail at this point, in the future, perhaps, but not today. Frank Takkinen: Okay, fair enough. I was going to follow up on the breast comment you made. I think you said 254 active surgeons plus 16% year-over-year. I was curious where you feel you currently stand in those active accounts from a percent of surgeons currently offering resensation. Any approximation of how much growth you still have to just inside of your same accounts with new surgeons? Michael Dale: Well, I think if you look at the growth in programs and account versus the growth in number of surgeons doing breast resensation, we can see that we are still activating new surgeons within those accounts and we believe there's still a lot of surgeons within our existing programs that we can continue to develop. So, we do believe there's still a significant opportunity within existing programs. Frank Takkinen: Okay. And then maybe just the last one. On the BLA process, what's left between now and September? Any major checkpoints that you feel that are most important to successfully receiving the BLA? Michael Dale: Sure. Well, the most important thing is to keep answering the questions that we received timely. So I think when they ask a question it's called an IR information request and it's a very formal process. So we've fielded I think 200 of these thus far through the process once they accepted our application. And that's gone very well. We've been able to answer it timely. The intercourse between FDA and our staff is very professional and very cordial. And so the work is going well. The next major milestone will be the late cycle meeting and that's where we all sit down to review and take stock of where we are. So we'll learn more there. All we can say at this stage is there's lots of work going on. And so far we're getting the work done. But it's just part of the process. Frank Takkinen: Perfect. That’s helpful. Thanks for taking the questions. Operator: Thank you. We have reached the end of the question-and-answer session. I would like to turn the floor back to Michael Dale for closing remarks. Michael Dale: Thank you, operator. On behalf of the Axogen team, I want to thank everyone for their time and interest in our work to fulfill the promise and potential for all stakeholders in our business purpose to restore health and improve quality of life by making restoration of peripheral nerve function an expected standard of care. We look forward to updating you on our continued progress and our plans on our earnings call next quarter. Thank you very much. Operator: Thank you. This concludes today's conference and you may disconnect your line at this time. Thank you for your participation. Before you buy stock in Axogen, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Axogen wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. 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As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Axogen (AXGN) Q1 2025 Earnings Transcript was originally published by The Motley Fool

This article first appeared on GuruFocus. Revenue: $61.5 million, representing 26.6% growth year-over-year. Gross Margin: 75.2% for the first quarter. Adjusted EBITDA: $5.7 million, 9.3% of revenue. Net Loss: $19.6 million or $0.38 per share, including a one-time loss of $16.8 million. Adjusted Net Income: $4.1 million or $0.07 per share. Operating Expenses: $49 million, up from $36.6 million in the prior year. Cash Equivalents, Restricted Cash, and Investments: $103.6 million as of March 31, 2026. Sales and Marketing Expenses: 46.6% of total revenue, up from 43.3% in the prior year. Research and Development Expenses: $7.5 million, 12.2% of total revenue. General and Administrative Expenses: $12.9 million, 21% of total revenue. Full-Year 2026 Revenue Guidance: At least 20% growth, or total revenue of at least $270 million. Full-Year 2026 Gross Margin Guidance: Expected to remain in the range of 74% to 76%. Warning! GuruFocus has detected 5 Warning Sign with AXGN. Is AXGN fairly valued? Test your thesis with our free DCF calculator. Release Date: April 28, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Axogen Inc (NASDAQ:AXGN) reported a strong first-quarter revenue of $61.5 million, reflecting a 26.6% growth year-over-year. The company achieved double-digit growth across all three target markets, demonstrating effective market development strategies. Axogen Inc (NASDAQ:AXGN) expanded its commercial insurance coverage, with Cigna extending broad coverage to Advance nerve graft for peripheral nerve repair. The company ended the quarter with $103.6 million in cash equivalents, restricted cash, and investments, indicating a strong financial position. Salesforce productivity exceeded expectations, with an increase in active surgeon count, reflecting broader adoption of nerve care. Operating expenses increased to $49 million, up from $36.6 million in the first quarter of 2025, driven by higher compensation costs. Net loss for the first quarter was $19.6 million, significantly higher than the net loss of $3.8 million in the first quarter of 2025. The company incurred a one-time loss of $16.8 million due to the extinguishment of its debt facility. Sales and marketing expenses as a percentage of total revenue increased to 46.6%, reflecting higher investments in commercial strategy. Gross margin is expected to face pressure in the second quarter due to the transition to Biologic Advance products. Q: Can you elaborate on the guidance for the year, given the strong 27% growth in Q1, and explain the expected deceleration? A: The guidance reflects sequential increases in comparables and the need for continued commercial execution. While confident about the future and the raised guidance, each quarter requires productivity growth, which is factored into the guidance. Q: Is there any impact from recent commercial coverage wins like Anthem and Cigna in the guidance? A: The guidance does not include material benefits from recent coverage wins as these need to be socialized with providers and negotiated into contracts. The impact will be positive but not immediate, with more insights expected in the next quarter. Q: What drove the acceleration in growth in Q1, and how does this affect the long-range plan (LRP) of 15% to 20% growth? A: The growth is due to cumulative effects of strategic initiatives, including market development and sales force productivity. The LRP remains unchanged at 15% to 20%, but adjustments may be considered as the year progresses and more data on payment and coverage is available. Q: What are the early signals from the prostate cohort, and when is the expected readout? A: The readout is expected in the third quarter, with current feedback being anecdotal but positive. The focus is on clinical signs for potency and incontinence, and how nerve grafting integrates into robotic procedures. Q: How does the transition to the biologic product affect hospital approval processes and commercial coverage? A: The transition is invisible to customers, with no changes in hospital approval processes. Some payers have restrictions based on gap length, but Axogen is actively engaging with them to address these issues. For the complete transcript of the earnings call, please refer to the full earnings call transcript.