MALVERN, PA — Neuronetics, Inc. (NASDAQ: STIM) has released its financial and operational results for the second quarter of 2024, marking a period of strategic initiatives and significant developments in its mental health care offerings.
For the second quarter ending June 30, 2024, Neuronetics reported revenue of $16.5 million, a 7% decrease compared to $17.6 million in the same period last year. U.S. NeuroStar Advanced Therapy system revenue stood at $4 million, representing a shipment of 50 systems. U.S. treatment session revenue saw a 5% decline compared to the second quarter of 2023, reflecting a drop in session volume primarily due to cash flow issues faced by customers following the Change Health cyberattack.
Operating expenses for the quarter increased by 3% to $20.7 million, compared to $20.1 million in the same period last year. Despite these challenges, the gross margin improved to 74%, up from 72.5% in the second quarter of 2023. The net loss for the quarter was $9.8 million, or $0.33 per share, compared to $4.9 million, or $0.17 per share, in the prior year. EBITDA for the quarter was negative $8.0 million, compared to negative $3.3 million in the second quarter of 2023. Cash and cash equivalents were $42.6 million as of June 30, 2024, down from $59.7 million at the end of December 2023.
In a major strategic move, Neuronetics announced a definitive agreement to acquire all outstanding shares of Greenbrook TMS in an all-stock transaction. This merger aims to create one of the leading providers of mental health care in the United States, offering substantial strategic benefits such as increased brand awareness for NeuroStar, consistent delivery of best practices, and enhanced service offerings for patients and providers.
Neuronetics also reported significant advancements in expanding access to its NeuroStar Transcranial Magnetic Stimulation (TMS) therapy for adolescents suffering from depression. Major insurers like Humana, BlueCross BlueShield of Michigan, Cambia Health Solutions, and Aetna have updated their policies to include TMS coverage for adolescents aged 15 and older. California’s Medicaid program, Medi-Cal, has also expanded coverage to this age group. These updates follow the FDA’s clearance of NeuroStar TMS for adolescents aged 15-21 with major depressive disorder in March 2024.
The company launched the Better Me Provider (BMP) program nationwide in July. Developed in collaboration with TMS medical experts, the program aims to set new standards for patient care and responsiveness. During its pilot phase, BMP demonstrated significant improvements, including faster follow-ups and reduced time from initial patient interest to treatment. With 300 active sites and 125 more committed, the program aims to make NeuroStar TMS Therapy more accessible to millions suffering from major depressive disorder, obsessive-compulsive disorder, and anxious depression.
In late July, Neuronetics secured a new debt facility of up to $90 million with Perceptive Advisors LLC. The initial tranche of $50 million was provided at closing, with additional tranches of $15 million and $25 million available under specified conditions. This facility allowed the company to pay off its SLR Capital Partners term loan, reducing net debt and providing financial flexibility for ongoing investments in commercial initiatives and clinical expansion.
Looking ahead, Neuronetics expects total worldwide revenue between $18.5 million and $19.5 million for the third quarter of 2024. For the full year, the company projects total worldwide revenue to be between $78.0 million and $80.0 million, with total operating expenses expected to range between $78.0 million and $80.0 million.
Despite facing industry headwinds, Neuronetics remains optimistic about its future, driven by strategic acquisitions, expanded coverage, and innovative programs aimed at improving mental health care.
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