Ekso Bionics Holdings, Inc. (NASDAQ:EKSO) Q2 2025 Earnings Call Transcript

Ekso Bionics Holdings, Inc. (NASDAQ:EKSO) Q2 2025 Earnings Call Transcript July 28, 2025

Ekso Bionics Holdings, Inc. misses on earnings expectations. Reported EPS is $-1.24 EPS, expectations were $-1.2.

Operator: Greetings, and welcome to the Ekso Bionics Second Quarter 2025 Financial Results Conference Call. [Operator Instructions]. It is now my pleasure to introduce your host, Stephen Kilmer, Investor Relations. Thank you. You may begin.

Stephen Kilmer: Thank you, operator, and good afternoon, everyone. Earlier today, Ekso Bionics released financial results for the second quarter ended June 30, 2025. A copy of the press release is available on our website. I would like to point out that management will make statements during this call that include forward-looking statements within the meaning of the federal securities laws, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Any statements made during this call that are not statements of historical facts should be deemed to be forward- looking statements. All forward-looking statements, including statements regarding our business strategy, future financial or operational expectations, our ability to close on delayed customer sales, our expectations of the regulatory landscape governing our products and operations are based upon management’s current estimates and various assumptions.

These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated or implied by these forward- looking statements. Accordingly, you should not place undue reliance on these statements. For a list and description of the risks and uncertainties associated with the company’s businesses, please see its filings with the Securities and Exchange Commission. Ekso disclaims any obligation, except as required by law, to update or revise any financial or operational projections, its regulatory outlook or other forward-looking statements, whether because of new information, future events or otherwise. Any forward-looking statements made on this call speak only as of the date of this call.

Representing Ekso Bionics today are Scott Davis, our Chief Executive Officer; Jerome Wong, our Chief Financial Officer; and Jason Jones, our Chief Operating Officer. With that said, I will now turn the call over to Jerome.

Jerome Wong: Thank you, Steve. Good afternoon, everyone, and welcome to our second quarter 2025 conference call. On behalf of the management team and everyone at Ekso Bionics, I would like to thank you for your interest in our company. And for those of you who are shareholders, we appreciate your support. For the benefit of those who are new to the Ekso Bionics story, I would like to take a moment to summarize our business. Ekso designs, develops and markets exoskeleton products that augment human strength, endurance and mobility. The primary end market for our exoskeleton technology is health care, where our technology primarily serves people with physical disabilities or impairment in both physical rehabilitation and mobility.

We operate as one operating and reportable segment with 2 markets, Enterprise Health and Personal Health. Our legacy Enterprise Health product consists mainly of our EksoNR device, which is a wearable robotic exoskeleton specifically designed to be used in a rehabilitation setting to assist individuals recovering from both acute and chronic conditions. And our newer Ekso Indego Personal device is a wearable lower extremity powered exoskeleton that enables certain individuals living with spinal cord injuries with the ability to stand and walk independently. Both products also include the sale of support and maintenance contracts. I will turn this call over to Scott in a moment for an update on our commercial activities and growth plans. However, before I do, I would like to provide a brief summary of our financial results.

To streamline things, all of the numbers I will refer to have been rounded, so they are approximate. As we mentioned in today’s press release, we experienced abnormal weakness in the second quarter of 2025. The company recorded revenue of $2.1 million for the period compared to $5 million for the second quarter of 2024. This was primarily driven by what we believe are short-term delays in completing certain multi-device Enterprise Health sales and was offset partially by higher Ekso Indego Personal device sales. As Scott will discuss shortly, we are working to get back on track for the second half of the year and beyond. Gross profit for the second quarter was $800,000, representing a gross margin of approximately 40%, compared to a gross profit of $2.6 million and a gross margin of 53% for the same period of 2024.

The change in gross profit was driven by a decrease in revenues associated with our Enterprise Health devices, partially offset by an increase in revenues associated with Ekso Indego Personal devices and a reduction in service costs. The decrease in gross margin was primarily driven by fixed cost of goods in relation to the decrease of enterprise health device sales, lower margin sales related to increased volume through distribution and an increase in shipping costs, partially offset by improved margins in service. Operating expenses for the second quarter of 2025, which consists of R&D, G&A and sales and marketing expenses were $4.8 million, a 4% improvement from $5 million for the second quarter of 2024. Net loss applicable to common stockholders for the 2025 second quarter was $2.7 million or $1.24 per basic and diluted share, compared to a net loss of $2.4 million or $1.99 per basic and diluted share for the same period of 2024.

As of June 30, 2025, the company had cash and restricted cash of $5.2 million. That is it for my summary of our second quarter 2025 results. Please see our Form 10-Q filed earlier today for further details regarding the results. I’ll now turn the call over to Scott.

Scott G. Davis: Thank you, Jerome, and good afternoon, everyone. I’ll cut to the chase. Our second quarter revenues were disappointing. But as Jerome noted, we believe this was a temporary setback, driven mostly by short-term delays in completing 2 significant multiunit Enterprise Health device sales that were anticipated in the quarter. As we discussed on our last call, we’ve also had a small percentage of U.S. customers impacted by loss of federal grants and/or concerns related to economic uncertainties who have pushed their purchases into later 2025 or early 2026. Nevertheless, we don’t believe the second quarter revenue shortfall truly reflects the health of our current business nor our prospects for the future. Several reasons are bolstering our confidence that we can get back on track for the second half of the year and beyond.

First, we’re confident that we will be able to close a significant portion of the deferred multi-device Enterprise Health sales prior to year-end. At the same time, we are capitalizing on continued Enterprise Health customer demand by recently signing a master subscription agreement with another major integrated delivery network. And to help support that, we are constantly looking for ways to help us raise awareness, acceptance and adoption of our exoskeleton technology within the market. A good recent example is our launch of eksoUniversity, a new virtual platform providing continuing education courses to physical therapists and physical therapist assistants across the country. While we believe eksoUniversity can generate incremental revenue for us, the greater value is represented through the program’s ability to educate the neurological/physical therapy community on a wide range of relevant topics and ever-evolving patient treatment options.

I’m happy to share that we have already delivered our first official CEU certification to a Connecticut-based PT coincidentally via course entitled Benefits of a Personal Exoskeleton. In addition, the general trend of lower but steady growth in our more mature legacy Enterprise Health business is being increasingly counterweighted by the growth in Personal Health from sales of the Ekso Indego Personal. To put that into perspective, despite total revenues for the first 6 months of 2025 being down 38% compared to the same period in 2024, Personal Health product revenues grew by more than 50%. As I’ve said in the past, while the majority of our revenue in 2025 is expected to still come from Enterprise Health, we believe that we will continue to see increasing contribution from our Personal Health products during the remainder of the year and beyond.

There are a few things driving that. First, as we’ve discussed in the past, CMS established pricing determination or our Indego Personal Exoskeleton in Q2 2024. This regulatory change created a significant opportunity to help Medicare enrollees living with the spinal cord injury by removing what has historically been a primary barrier to accessing our exoskeleton. Accordingly, we immediately set out to establish a go-to-market strategy aimed at notifying as many early physician and provider adopters as possible of the new CMS benefit category redetermination and fee schedule listing. Additionally, we began working closely with our extensive network of neuro rehabilitation partners across the country, focused on educational efforts and on appropriate patient selection and process for patients prescribed in Ekso Indego Personal for the home and community setting.

With that early work largely completed, we then shifted our primary focus from building awareness and providing customer education to advancing our scalable go-to-market strategy for the personal channel. One of the important changes we made was to engage PRIA Healthcare, one of the leaders in market access services, which has been instrumental in the successful commercialization of over 300 medical devices. We are confident we made the right choice in partnering with PRIA. PRIA has been providing us with invaluable strategic guidance, leveraging its expertise to help us navigate the complexities of coding, coverage and payment, thereby allowing us to more effectively put Ekso Indego Personal within reach of individuals who need this potentially life-changing mobility-enhancing technology.

On the distribution front, I’m pleased to report that in the second quarter, we received the first order from National Seating & Mobility, or NSM, our exclusive Ekso Indego Personal device distributor within the complex rehabilitation technology or CRT industry in the United States. Also in Q2, we named Bionic P&O, a leading national provider of prosthetic and orthotic solutions as our first O&P distributor. We’re excited that they submitted an additional 3 patient claims for the Indego Personal exoskeleton to Medicare in the second quarter. Altogether, with Ekso’s focused marketing efforts, we’ve now developed a pipeline of more than 45 Medicare beneficiaries that we believe are qualified candidates for Ekso Indego Personal in 2025. That’s up more than 200% from where we were at the end of 2024.

As a reminder, factors considered for the candidates to be represented in our pipeline include, among other things, Medicare enrollment, an appropriate indication for use and medical necessity. And we again caution that we cannot guarantee that all of our pipeline will result in new claims submissions occur before the end of this year or ultimately be paid. Finally, we continue to innovate. In mid-May, we announced that Ekso joined a select group of medical device companies in the NVIDIA Connect program. NVIDIA Connect brings together emerging and established technology companies to accelerate product development and increase cost efficiency. Members gain specialized training, priority engineering support and exclusive access to NVIDIA’s advanced development kits, GPU platforms and global ecosystem, helping facilitate the program members’ ability to deliver next-generation solutions in AI and high-performance computing.

While we believe our advanced exoskeleton technology platforms are already state-of-the-art, we’re working to use the valuable tools and resources provided through this prestigious NVIDIA program to support a new strategic initiative to build a proprietary foundation model for human motion and physical rehabilitation, and to help develop and integrate related new AI capabilities across our portfolio of enterprise health and personal health devices. This aligns squarely with our mission of improving health and quality of life with advanced robotics designed to enhance, amplify and restore human function. And we are walking the talk. Indeed, just 34 calendar days after announcing our acceptance into the NVIDIA Connect program, we revealed initial proof of concept in the form of a new AI voice agent designed for intelligent control of our legacy EksoNR device.

Ekso Voice Agent is being implemented on NVIDIA Jetson Orin Nano hardware developed with the NVIDIA JetPack SDK and OpenAI tools for voice recognition. The proof of concept is configured as an edge AI system, which can run with or without connection to the cloud. While this initial proof of concept was with the EksoNR, integration of new AI-powered capabilities into both our enterprise and personal health devices is a key pillar of our growth strategy. We are in the fortunate and enviable position of already having a repository consisting of approximately 350,000 patient sessions and over 15 million step-by-step data points, and that is growing by an additional 60,000 patient steps on average every day. The aim is to develop AI tools designed to leverage this proprietary data in order to help transform human robot interaction.

In other words, while the AI hardware is coming from NVIDIA and others and much of the software is open sourced, we believe our large and growing database sets us apart, making us uniquely positioned to utilize AI to advance exoskeleton technology platforms. In summary, the second quarter was abnormally weak from a revenue perspective, and that was primarily due to what we believe are short-term delays in completing some multi-device Enterprise Health sales, and we’re working diligently to get back on track for the second half of the year and beyond. At the same time, as we work to capture deferred sales and capitalize on anticipated customer demand in the legacy enterprise health market, we are continuing to build and execute on a scalable go-to-market strategy for Indego Personal, supported by established and new industry-leading DME, O&P and market access partners that is driving an increased contribution from our Personal Health products, which grew by more than 50% year-over-year in the first half of 2025.

Finally, we’ve launched a strategic initiative aimed at building a proprietary foundation model for human motion and physical rehabilitation, and to help develop and integrate related new AI capabilities across our portfolio of enterprise health and personal health devices. We believe AI is a necessary component to enable broader adoption of exoskeletons for personal use. This ends our prepared remarks for today. And with that, we are happy to take any questions you might have. Operator?

Q&A Session

Operator: [Operator Instructions] Our first question comes from the line of Ben Haynor with Lake Street.

Benjamin Charles Haynor: First off for me on the deferred sales that you guys have on the Enterprise Health side, it sounds like a lot of them are potentially going to fall into the current quarter. Can you quantify how much is deferred there? How much you expect kind of the back half of the year?

Scott G. Davis: Ben, thanks for your question. Yes, we — as we had indicated, we had 2 multiunit device sales that fell out of Q2. And to shed a little bit more light on those, there were 2. One was an international order that was delayed due to some regulatory challenges that we expect to occur in this calendar year. We have a strong belief that, that will happen within 2025. And the other was a North American IDN. This was a sizable multiunit order that was comprised of renewals as well as new hospitals coming online. And that, we believe, will occur in the third quarter in the quarter that we’re in today, and that one is in the $1 million range. And the other — between the 2, it was about $1.4 million.

Benjamin Charles Haynor: Okay. Got it. That’s definitely helpful. And then on the Indego Personal, I know that’s obviously growing at a faster rate than you expect the Enterprise Health business to grow and eventually, it will overtake the Enterprise Health business. Do you have any sense on — what’s your thinking, I guess, on when that sort of flip could happen?

Scott G. Davis: That’s a great question and something that we’ve been working really hard on as a management team, as a company. All of the work that we’ve done internally with our own resources as well as working with PRIA Healthcare, the onboarding of our 2 new distribution partners in the space for scalable go-to-market strategy, the work we’ve done to increase the marketing efforts to continue to increase leads and build pipeline demand as well as the business development work we continue to do looking for other national O&P providers to work with. We’re already beginning to see the positive impacts of that work. And in addition to that, we’re doing a lot of work within the VA systems to increase those opportunities as well as workers’ compensation.

So as we’re looking at that sort of blended ecosystem, and we look back at 2024, that represented approximately 10% of our revenue for the company. And as we’re looking at 2025, we believe that, that will be closer to 25% contribution to our revenue, total revenue. And as we move forward and cross into 2027, we believe that it will begin to overtake what we’re seeing on enterprise.

Benjamin Charles Haynor: Okay. So a couple of years out, maybe 18 months from today. that’s good. So then just kind of thinking about PRIA and just kind of curious, I mean, it does sound like you’ve really nailed down the patient profile. How has that — how is nailing down the process come along? Have you been before any more ALJs, learned anything new that’s worth noting? Kind of anything on that front?

Scott G. Davis: Yes. I mean that remains an area of focus for us as we work through appeals process. We have a couple of patient claims that will go before ALJ in Q3. In Q2, we had one that went before ALJ that was remanded to a lower level in CMS and ultimately approved. So we are seeing positive outcomes. The important part here is that we are being reaffirmed that these are medically necessary. So they are getting reimbursed when we’re able to get in front of these administrative law judges, they can really understand this a bit better. And again, this is a ramp-up period. So what we’re being very cautious with in working with our DME partners and O&P partners is to ensure that we’re level setting expectations with patients and health care providers and ensuring that we’re putting forth the best claims possible so that we can pave a way to these happening on a more routine basis.

But with any new process, it takes a little time to crime it, but we believe that we’re starting to make some good progress.

Benjamin Charles Haynor: Okay. Got it. And then lastly for me on eksoUniversity. Is that going to be something that is solely focused on exoskeletons? Or are there additional modules or see the content that we’re going to be putting in there?

Scott G. Davis: Yes, great question. So we see that as just an area that can really focus in on neuro rehabilitation. And our first courses are centered more around exoskeleton technology, but we expect that they’ll run the gamut in the latest in neuro rehabilitation process and procedures that we’re seeing out there. We have a rich population of neuro PTs that are part of our ecosystem that are contributors as we’re developing these materials. So we have a lot to pull from as we’re putting these courses together. So for us, it’s purely about education. And if we can show — demonstrate and expose more people to what’s possible with technology, all different types of technology, then we believe it benefits the entire industry.

Operator: Our next question comes from the line of Swayampakula Ramakanth with H.C. Wainwright.

Swayampakula Ramakanth: Sorry, I’ve been on the call on and off. So just to understand, what’s the new collaborations that you generated to ensure a smooth commercialization of the personal devices, how is that working out? And do you — when do you think that the growth will be meaningful based on these new relationships just on the personal before we get into the enterprise? I have a couple of questions there.

Scott G. Davis: Sure. Thanks, RK. The — as we talked about today in our comments, and as I had previously said, we’re working diligently with industry partners, PRIA, on the — just helping us navigate the nuances of market access and working with CMS and not only us, but also being a resource for our partners, for our distribution partners, whether on the CRT side or on the O&P side, helping with the appeals process and really navigate and help us sort of build this new road brick by brick. So that has been helping us tremendously. The partnerships that we have developed with Bionic P&O and with NSM and with other large O&P providers that we’re also building relationships with, we see that progressing quarter-over-quarter.

What starts slow with initial discovery and then getting those first patients through and initial claims submitted to more claims submitted the following quarter, we’re seeing the progression. We’re going from one to a handful to more through these partners each quarter. And today, a lot of the leads that we’ve been developing have been ones that Ekso has created, but we’re already beginning to see a bit of a shift through the ecosystem where as we’re out doing trainings and onboardings out of the various rehabilitation sites, the sites themselves have patients that they want to bring in. These are our existing maybe legacy customers who are using — who have used our technology for years where the training happens are identifying — beginning to identify some individuals who could use the technology as well as our distribution partners through their own connections are — we see this as a lead source that’s just beginning to develop.

So this truly is what we believe is a scalable process working with best-in-breed providers, all focused on what we do best to bring this technology out to the people who can use it most.

Swayampakula Ramakanth: Okay. Great. And then on the enterprise sales, what do you think needs to be done immediately to manage — to get back to growth? And how long do you think it will take?

Scott G. Davis: Yes. So yes, we’re — as I had said, we are certainly disappointed with the results of Q2. And to get back on track. I guess the good news in that is that we had a number of devices and 2 large deals, in particular, that are still on the table, very much on the table and the North American IDN, which was over $1 million in Q2, which we believe has potential for even more in Q3. We are bullish that we could pull that in Q3. So we don’t view that as a lost deal rather as one that’s deferred. And we’re continuing to work in our rich pipeline that we’ve developed over the years to help enterprise customers who maybe have had some budget interruptions, whether it’s a loss of a federal grant or whether it’s just concerns in their budget, we’re working with them to identify potentially another option, other options for being able to onboard the technology that maybe isn’t leveraging a capital budget or leveraging a grant.

We are actually working with a new third-party financial partner that can also help these individuals switch this into their operational budgets and their capital budgets. So we are, I will say, pulling out all the stops to help the enterprise customers, who want to use this technology to treat patients still have the wherewithal to do that even with some concerns over their 2025 budgets.

Swayampakula Ramakanth: Then the last question from me is, so far, we have been talking about enterprise — potential enterprise clients who are being impacted by the loss of federal grants. The corollary question is like how many of them — how many of the current enterprise clients are actually utilizing federal grants? And how sure are we that those things will get extended over the next contract period?

Scott G. Davis: Yes. So in general, we don’t have a magic number on how many hospitals go for federal grants for this technology. I think if we look historically, from a pure revenue standpoint in North America, I would approximate 10% of our enterprise customers rely on federal or outside grants to fund their technology. And I think that’s a conservative estimate.

Operator: And we have reached the end of the question-and-answer session. I would like to turn the floor back to CEO, Scott Davis, for closing remarks.

Scott G. Davis: Thank you, operator, and thank you to everyone for joining us today. We look forward to updating you as we continue to progress.

Operator: Thank you. This concludes today’s conference, and you may disconnect your lines at this time. Thank you for your participation. Have a great day.