Myomo, Inc. (NYSE:MYO) Q3 2025 Earnings Call Transcript

Myomo, Inc. (NYSE:MYO) Q3 2025 Earnings Call Transcript November 10, 2025

Myomo, Inc. beats earnings expectations. Reported EPS is $-0.09, expectations were $-0.11.

Operator: Good day, and welcome to the Myomo Third Quarter 2025 Financial Results Conference Call. All participants will be in listen-only mode. After today’s presentation, there will be an opportunity to ask questions. Please note this event is being recorded. I would now like to turn the conference over to Tirth Patel, with Alliance Advisors IR. Please go ahead.

Tirth Patel: Thank you, operator, and good afternoon, everyone. This is Tirth Patel with Alliance Advisors IR. Welcome to the Myomo Third Quarter 2025 Financial Results Conference Call. Joining me on today’s call are Myomo’s Chief Executive Officer, Paul Gudonis, and Chief Financial Officer, Dave Henry. Before we begin, I’d like to caution listeners that statements made during this call by management other than historical facts are forward-looking statements. The words anticipate, believe, estimate, expect, intend, guidance, outlook, confidence, target, project, and other similar expressions are typically used to identify such forward-looking statements. These forward-looking statements are not guarantees of future performance and may involve and are subject to risks, uncertainties, and other factors that may affect Myomo’s business, financial condition, and operating results.

These risks, uncertainties, and other factors are discussed in Myomo’s filings with the Securities and Exchange Commission. Actual outcomes and results may differ materially from what’s expressed in or implied by these forward-looking statements. Furthermore, except as required by law, Myomo undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this call today, 11/10/2025. It’s now my pleasure to turn the call over to Myomo’s CEO, Paul Gudonis. Paul, please go ahead.

Paul Gudonis: Thanks, Tirth. Good afternoon, and thank you all for joining us today. I’m pleased to announce that Myomo had another strong quarter with revenue of $10.1 million, coming in at the high end of our expectations. This was driven by record revenues in our international markets and a growing number of O&P providers. In addition, we saw our pipeline increase, and for the first time this year, our quarterly authorizations and orders increased sequentially. We are seeing more Medicare Advantage payer authorizations and orders from the new in-network contracts we signed earlier this year. Now before turning the call over to Dave to review the financial results in detail, I’d like to touch on the progress we made during the quarter on the key initiatives that we outlined on our last call.

These were to: one, improve the identification and qualification of prospective patients; two, expand the MyoConnect program and O&P channel; three, expand insurance coverage; and four, reduce our overall operating costs. First, as mentioned, the core area of focus has been improving the identification and qualification of prospective patients. The number of new patient candidates who qualify for MyoPro is growing, and with the shift in our advertising media mix, the cost per pipeline add is beginning to decrease. In Q3, we shifted more of our advertising spend to TV from social media, which yielded a higher percentage of leads that met our clinical criteria to become a successful patient. These candidates were also more motivated to quickly complete the screening process.

Thus, we enhanced the quality of our pipeline adds as well as generating a sequential increase in the number of candidates in the pipeline. We hired a new head of marketing with extensive experience in healthcare direct-to-consumer advertising as well as B2B marketing to support our efforts, particularly in reinforcing our message to physicians, therapists, and O&P practitioners. We will optimize the use of our various media to educate patients, family members, clinicians, and payers about the benefits of the MyoPro. Second, we believe the path to lowering customer acquisition cost is by developing recurring sources of patients that do not depend on a prospective candidate’s self-initiating response to a paid advertisement. That is central to our new MyoConnect program and the growing O&P channel.

Our MyoConnect clinical referral program is off to a good start, generating high-quality patient referrals by therapists and physicians at rehab clinics around the country. Importantly, there is no advertising expense incurred to educate these clinicians and these patients since we are already engaged with them. In mid-year, we launched MyoConnect, where our field clinical teams engage directly with therapists and physicians across the country to expand the network of clinicians who understand the benefits the MyoPro can produce. These clinical practitioners, who are responsible for the design and delivery of patients’ treatment protocols, refer qualified patients to us through our local O&P channel partners. Over the years, we have trained numerous occupational therapists who have seen the improvement in patient functionality from the MyoPro.

Their willingness to refer patients was facilitated by CMS’s decision to cover the MyoPro for Medicare reimbursement and by the introduction of the new MyoPro 2X model this past spring. The result is we are beginning to see more OTs and physicians sending their patients our way to obtain a MyoPro. While still early in the rollout, we are encouraged by the initial traction and believe this program can develop into a scalable and cost-efficient source of high-quality referrals over time. Another source of recurring orders is the O&P channel. We are continuing to provide clinical and reimbursement education and certification to the O&P practitioners, which is the mechanism to expand adoption in this channel. In September, we attended the American Orthotics and Prosthetics Association National Assembly, which is the major trade show for the O&P industry.

We had a productive set of meetings with existing and prospective channel partners, and I am confident that sales to these clinics will continue to grow as we diversify our revenue sources beyond our direct-to-consumer advertising and direct billing business. Revenue from this new O&P channel more than doubled year over year, and their patient pipelines are growing with the training and clinical support we are providing to these certified prosthetists and orthotists. In the past 45 days, I’ve had meetings with senior managers of the large and small O&P clinical groups in the industry as we work together to bring the MyoPro to their patients. We have good working relationships with these firms, and they are eager to work with MyoPro on programs to help improve the upper extremity impairments this important segment of their patient population has.

They already treat stroke patients with various lower extremity assisted devices to enable their mobility. Meanwhile, our own chief channel partners in Germany placed a record number of orders in the quarter, leading to strong growth in revenues from our international operations and a greater number of patients in the pipeline for continued growth. Third, to expand insurance coverage, our Chief Medical Officer and reimbursement team have been following up with the major Medicare Advantage payers to obtain more MyoPro authorizations for their beneficiaries. We saw a sequential increase in authorizations for patients covered by some of these plans and from payers with whom we have contracts. These positive results led to the higher number of authorizations and orders this past quarter.

During Q3, we signed an additional contract with a payer to become an in-network provider for our direct billing business, which now brings us to 35 million covered lives among private payers. We have other contracts pending as well to increase access to MyoPro for patients covered by these commercial health insurance plans. There’s also a development in the payer industry that could be positive for Myomo. Insurance companies that offer Medicare Advantage plans are withdrawing Medicare Advantage coverage from certain geographic areas, thereby reducing their member count. For example, UnitedHealthcare projects a 1 million member drop, and other payers are making similar announcements. If these patients choose to enroll in standard fee-for-service Medicare, those that are medically qualified for MyoPro may be more likely to obtain our device for their paralyzed arms under Medicare Part B coverage.

To support increased reimbursement, we continue to add to the published research on the MyoPro. During Q3, a highly respected Topics in Stroke Rehabilitation Journal published a systematic review of patient outcomes from the use of the myoelectric orthosis. Providing this information to payers, rehab physicians, and therapists, as well as O&P professionals, leads to greater insurance coverage and clinical adoption. Lastly, during the quarter, we implemented manufacturing changes to improve our gross margin and also managed headcount and other cost reductions to lower operating expenses. We are positioning ourselves for improved operating leverage as we grow future revenues based on the larger patient pipeline augmented by the increased number of authorizations and orders we expect from the MyoConnect program and the expanded O&P channel.

Based on the backlog going into the fourth quarter and the number of patient cases progressing through reimbursement, we are able to reiterate our full 2025 annual guidance of $40 million to $42 million, which represents an increase of more than 23% over last year. With that overview of our performance and actions, I’ll turn the call over to our CFO, Dave Henry, to provide more of the financials and details on our newly executed term loan facility, which is designed to provide us with growth capital to continue scaling the business to sustainable profitability and positive cash flow as our MyoPro volumes and revenue increase.

Dave Henry: Thank you, Paul, and good afternoon, everyone. Let me start with a review of our third quarter financial results. Revenue for 2025 was $10.1 million. This represents a 10% increase versus the prior year and was driven by a higher number of revenue units offset by a lower average selling price or ASP. We delivered 186 MyoPro revenue units during the quarter, up 16%, with 57% of those units from authorizations and orders received in the third quarter. Our ASP decreased 5% versus the prior year to approximately $54,300 and was roughly flat sequentially. ASP in the prior year period was unusually high due to the change in revenue recognition for Medicare patients to be upon delivery instead of payment. In that period, we began recording Medicare and some supplemental revenues at delivery in addition to some at payment on deliveries prior to the accounting change.

This had about a $4,300 favorable impact on ASP in 2024. Normalized for the accounting change, ASP increased 3% year over year. Medicare Part B patients represented 54% of revenue in the third quarter. Medicare Advantage revenue was 18% of third quarter revenue and in dollar terms was down 18% compared with the prior year. Medicare Advantage revenue remained constrained by the high number of pre-authorization denials, forcing us into an appeals process in order to serve these patients. This is not unique to Myomo. Unfortunately, insurance companies force patients into this process, hoping they will not appeal. And while successful appeal rates vary, we typically see about 45% to 50% overturned on appeal for those that stay engaged with us in the process of trying to receive a MyoPro.

73% of revenue in the third quarter came from the direct billing channel, compared with 81% in the prior year quarter. International revenue was a record $1.8 million in the quarter, up 63% and representing 18% of total revenue, primarily from Germany. Revenue in the O&P channel was also a quarterly record at $900,000, up 154% year over year and representing 9% of total revenue. As Paul mentioned, the O&P channel is emerging as a high-quality, lower-cost source of qualified patients, and we intend to continue to develop this channel. As of 09/30/2025, the pipeline stood at 1,669 patients, an increase of 32% year over year. In the third quarter, we added 826 patients to the pipeline, which is up 28% from the prior year quarter and up 1% sequentially.

There were 266 Medicare patients in the pipeline, an increase of 21% year over year and 4% sequentially. We ended the quarter with a backlog of 208 patients, down 34% versus the prior year. As a reminder, backlog represents insurance authorizations and orders received but not yet converted to revenue. In the case of Medicare Part B patients, whom we have collected medical records and deemed qualified for delivery based on our inclusion criteria. The decrease represents reduced Medicare Advantage authorizations and the fact that intra-quarter fill units are making up an increasing percentage of our quarterly revenues. In other words, we were able to convert more of our backlog into revenue faster. Indeed, 57% of third quarter revenue units came from intra-quarter fill units, up from 24% a year ago.

We received 229 authorizations and orders during the third quarter, an increase of 11% sequentially and 2% year over year. The higher authorizations and orders helped us to generate record revenue from intra-quarter fill units. Gross margin for 2025 was 63.8%, down from 75.4% for the prior year quarter. Prior year gross margin was favorably impacted by a change in accounting for revenues from Medicare patients that I mentioned earlier, which favorably impacted third quarter 2024 gross margin by approximately 200 basis points. In addition, with our growth, we opened a new facility and hired additional staff, leading to higher payroll and lease expense. Finally, an unfavorable change in the overhead absorbed in inventory in 2025 negatively impacted gross margin, as well as higher material costs.

Higher labor and overhead spending and change in absorption impacted gross margin by approximately 800 basis points and represents an opportunity to improve gross margin as activity increases. Total operating expenses for 2025 were $10 million, up 26% over 2024 but down 6% sequentially. This increase was driven primarily by higher payroll and advertising spending and by higher R&D due to development efforts on a mobile app for our MyConfig software, the MyoPro 3, and funding for a pilot of a randomized control trial at the University of Utah. As Paul touched on, we are focused on more efficient customer acquisition, leading to a sequential reduction in cost per pipeline add. We are investing in our MyoConnect platform and expect to gain further leverage with our growth in patients.

Operating loss for 2025 was $3.5 million, compared with an operating loss of $1 million in the prior year quarter. Net loss for 2025 was $3.7 million, or $0.09 per share. This compares with a net loss of $1 million, or $0.03 per share, for 2024. During 2025, approximately 600,000 pre-funded warrants were exercised. As of 09/30/2025, approximately 3.8 million pre-funded warrants remain outstanding from our offerings in 2023. These pre-funded warrants are considered common stock equivalents under GAAP accounting and are included in our weighted average shares outstanding. Adjusted EBITDA for 2025 was a negative $2.7 million, compared with a negative $600,000 for 2024. Turning now to our balance sheet and cash flow. As of 09/30/2025, cash, cash equivalents, and short-term investments were $12.6 million.

Cash burn was $2.9 million in the third quarter, including $1.8 million from operating activities and $1 million from capital expenditures related to the setup of the additional manufacturing space we took over in the third quarter, along with capitalized software costs for one of our product development projects and demo unit builds. On 11/04/2025, we entered into a loan and security agreement with Avenue Capital, which provides for a committed term loan facility of $17.5 million, of which $12.5 million was funded at closing. The remaining $5 million is available to borrow at our discretion from November 2026 through May 2027, assuming certain conditions are met. We will make interest-only payments for the next eighteen months, after which we will repay principal in 24 equal monthly installments.

Use of proceeds went to repay the borrowings of our $4 million under our credit facility with Silicon Valley Bank and fees and expenses, with the remaining $7.6 million to be used for general corporate purposes. Pro forma for the funding provided at closing, net of repayment to Silicon Valley Bank and fees and expenses, our cash balance as of 09/30/2025 is $20.1 million. For more details regarding the term loan facility, please refer to our current report on Form 8-K filed today. Let me close with our financial guidance. Given our backlog entering the fourth quarter and anticipated fill units, we continue to expect full-year 2025 revenue to be in the range of $40 million to $42 million. While we are not providing specific 2026 guidance at this time, we want to convey that we are focused on diversifying our revenue streams in 2026, relying less on advertising-driven revenues and generating growth through our MyoConnect platform and further penetration of our O&P channel in international markets.

We plan to improve operating leverage and lower the cash burn in 2026. With that financial overview, I’ll turn the call back to Paul.

Paul Gudonis: Thanks, Dave. Operator, we’re now ready to take our attendees’ questions. Thank you.

Q&A Session

Operator: We will now begin the question and answer session. And while we’re waiting for the first question, I’d like to mention that we will be attending the Craig Hallum Alpha Select Conference in person in New York City on November 18. Hope to see some of you there. Okay, operator, whenever you’re ready, let’s take the first question.

Chase Knickerbocker: Yes. First question comes from Chase Knickerbocker with Craig Hallum. Please go ahead.

Chase Knickerbocker: Good afternoon. Thanks for taking the question. So maybe just to start, could you help us quantify the scale of your U.S. O&P business at this point? So just from a domestic O&P perspective, how many units did you ship into that channel in the third quarter just to help us think about how that business is scaling?

Dave Henry: It was about $900,000, and I must say it was roughly 30 units, but I’ll get you the exact number.

Chase Knickerbocker: No worries. That’s helpful. And then maybe just as far as your new Head of Marketing goes, can you just cue us in on what kind of levers were identified as far as potential avenues for improvement in terms of reducing customer acquisition costs? I respect that you’re becoming more focused on MyoConnect here, but just kind of within that direct billing channel, any levers that were initially identified as far as we need to be doing this, need to be doing this better, etcetera?

Paul Gudonis: Yes. During the interview process, Chase, we were looking for people who had experience in various media: social media, television, YouTube, other channels. And so we’re looking at that and doing a comprehensive review right now of, okay, how effective is our television advertising? Are we using social media the right way? What else should we be doing to again generate more leads at a lower cost per lead for qualified patients? So that’s the review that’s underway right now. And she started about two weeks ago.

Chase Knickerbocker: Got it. Maybe just kind of turning to the pipeline, etcetera. There was a noticeable uptick as far as backlog drops are concerned. Can you just kind of walk us through what might be the driver there, kind of what you saw in the quarter as far as how the backlog progressed?

Dave Henry: Yes. I think a lot of the backlog drops, I would say about 40% of them came from Germany as a result of what I think was, I don’t think the backlog in terms of some of those trials that did not convert was updated, and I think there was some cleanup that went on in the third quarter. And so I think part of that higher number of backlog drops is due to that. So like I said, about 40% of those drops related to that, with the rest just normal activity.

Chase Knickerbocker: Got it. Maybe just last one for me, Dave. Is this the right way to think about OpEx for the foreseeable future? I mean, how should we be thinking about OpEx kind of building off of Q3 levels? And then along those same lines, if you could just talk about how you guys are thinking about the time to return to positive adjusted EBITDA and kind of how you’re managing the business with that in mind?

Dave Henry: Yes. So I think in terms of the operating expenses, our plan is to, there is going to be some growth in the operating expenses. For example, we do intend to spend more on advertising, though not as much of an increase as in 2025. We are going to spend more on R&D, particularly for that randomized control trial that we’re funding that I mentioned earlier. But other than that, our intention is to not grow the operating expenses as much as possible. And we want to be generating and showing that we can generate operating leverage and grow revenues faster than operating expenses. And in terms of when we get back to positive adjusted EBITDA, again, we’ll provide more of an update when we give our 2026 guidance.

Chase Knickerbocker: Understood. Thanks for the questions.

Operator: Thank you. The next question comes from Scott Henry with AGP. Please go ahead.

Scott Henry: Thank you and good afternoon. A couple of questions on the metrics. I guess first, reimbursement or not reimbursement, but pipeline adds, they were up slightly in Q3 to Q2. Do you think you could still see big gains there, or is it going to be harder at some point, there’s a saturation level? Or is it maybe it’s just flattening before jumping higher again? How do you think about that pipeline add or that top of the funnel?

Paul Gudonis: Well, Scott, given the size of the market opportunity, of the prevalence and a quarter million new cases just in the U.S. every year, I don’t think we’re near saturation. I think we’ve got to find better innovative ways to reach those patients. But also, I think through the O&P channel referral program, I’m expecting we’re going to see more of our patient pipeline adds coming through those channels. And so I expect that’s what’s going to drive more growth not only this quarter but into 2026 because there are so many people coming out of these rehab hospitals and stroke clinics with a paralyzed arm. We want to make sure that they know about the MyoPro because what we found is they are more medically qualified. They pass our screening criteria because they are more recent to their stroke.

We also find that they’re more motivated because they might have just lost their ability to use that arm a year ago versus twenty-five years ago. So you don’t have that sort of patient inertia. That’s why we want to capture more patients in the prep in incidence population. I think we’ll grow the pipeline, but also improve the quality of the pipeline.

Scott Henry: Okay. All right. That’s helpful. Thank you. And then when we think about Q4, you’re going to have a smaller backlog entering Q4 than you did entering Q3. And typically, the quarter before you use backlog is an indicator for what we should expect in the next quarter. So I know your guidance targets growth, but if you could just kind of walk through sequential growth from Q3 to Q4, if you could just talk about how you’re going to do that with a smaller backlog? It may just be other levers that are pulling, but I just want to get a better understanding from your perspective. Thank you.

Dave Henry: Yes. Well, it’s obviously going to come from fill units and from authorizations and orders that we get inside of the quarter. You’re correct that the backlog is lower. But we’ve also been demonstrating that as we get authorizations and orders, our operations are actually able to turn them into revenue faster. And so that’s what we plan on seeing, that growth in the fourth quarter coming from.

Scott Henry: Okay. So we should expect that to continue and even accelerate, that day trippers, if you will, people that come and go in the same quarter.

Dave Henry: I think as the authorizations and orders go up, I think that we will probably, the number of fill units that we have just in whole numbers will probably also go up as we go through time.

Scott Henry: Okay, great. And then I guess final question, and it’s somewhat strategic. It’s always a little higher risk profile to take on debt when you’re losing money. The question is, is this a sign that you think, I mean, obviously, you have eighteen months runway before you have to start paying it back. But do you feel based on your ability to take this debt that eighteen months from now, you could be close to breakeven? Just trying to get a sense of the decision to take debt over equity, even though I know you’re not probably happy with the share price, but certainly debt has a degree of risk that comes with it.

Dave Henry: Sure. First off, I guess, we would not have done this transaction if we didn’t feel like we could pay it back. That was really the first criteria. And so, I think that also sort of says that before in the eighteen months that we, before we started having to pay this back, we would expect that we’re not burning cash by the time we get to that point. That’s so we’re managing the business that way through continuing to grow revenues. And by holding down the growth in operating expenses and generating more incremental operating income from those additional revenues. So we feel like that we could pay it back. Obviously, that was the first criteria. And then it was the best combination of capital that was provided to us with the minimum amount of dilution. And so we’ve been very consistent that if we were to look for additional, we wanted to do it in a way that was the least dilutive way possible. And we feel that we accomplished that.

Scott Henry: Okay. Thank you for that insight into the decision-making. I appreciate that. That should do it for me. Thank you for taking the question.

Operator: All right. Thanks, Scott. The next question comes from Anthony Vendetti with Maxim Group. Please go ahead.

Anthony Vendetti: Hi, it’s Anthony. So Paul and David, in terms of the O&P clinics, how many have been trained so far? Do you have a goal in terms of the number you’d like to have by the end of ’25? Or by the end of ’26? And then, I was wondering if you could discuss a little more of the details of MyoConnect. What’s behind that initiative and what do you hope to accomplish there? Thanks.

Paul Gudonis: Yes. Hi, Anthony. So we’ve been training a lot of O&P clinicians, but in various stages of their certification process. For example, a couple of hundred have taken the online training program on how to evaluate a patient. And then those that have moved forward to get that patient into an evaluation, we show up in person with our clinical team to do the evaluation with them. So there’s that additional training. Then they have to fit up three units in order to become fully certified. That number is growing. The good news is we’ve got a lot of interest among Hanger clinicians around the country. We’ve got the other major firms like Ottobock has a number of clinicians, O&P has its four motion clinics, and Equal, there’s like 90 clinics.

So we continue to do seminars on reimbursement, on clinical training, on how to do the marketing as well. So our goal is to have a couple of dozen, I would say, that are actively placing orders this year, and our goal is to continue to expand that. I think what you’ll see is, I’ve mentioned this in previous calls, someone will do one order, see how it works out for their patients, get good outcomes, make sure they get the reimbursement check, they’ll do another one, and that starts to take off from there. As far as MyoConnect, one of the assets we have is we’ve got a dozen field clinicians, primarily occupational therapists, who are well-versed in the MyoPro. They’re in these rehab hospitals all the time, training therapists on how to work with users who get a new MyoPro.

We train some 80 to 100 therapists every month, and in the process of doing so, we conduct in-service presentations, and we’re seeing a growing number of clinical referrals now. And we think that will be a real source because the strategic shift that I’m looking to execute here is from one-time sort of advertising-driven orders from a patient to recurring sources of patients. So that’s O&P providers in the U.S. and Germany and rehab hospitals who will hopefully provide us with a steady flow of new patient candidates. So that’s the outline of the MyoConnect program.

Anthony Vendetti: Okay. And then just lastly, maybe more for David, but just in terms of getting to breakeven, any update on what that quarterly revenue run rate needs to be or timeline for getting there?

Dave Henry: Well, when we did the headcount reduction earlier this year, prior to that, we kind of gave some guidance of about $17 million to $18 million of quarterly revenue was required to breakeven. I think after that headcount reduction in July, you probably shaved about $1 million a quarter off of that. So I would say around $16 million to $17 million.

Anthony Vendetti: Okay, great. All right, thanks. I’ll hop back in the queue. Appreciate it.

Operator: The next question comes from Sean Lee with H.C. Wainwright. Please go ahead.

Sean Lee: Hey, good afternoon, guys, and thanks for taking my questions. I just have two quick ones. First, I think you mentioned it’s $1.8 million of revenue from Germany this quarter. It seems to be increasing quite well. So I was wondering if you can provide some color on that. What’s behind the increase there?

Paul Gudonis: Well, we’ve got a network of 100 O&P channel partners there that have been developed over the last several years, Sean. And in Germany, we’ve had very good success with the statutory health insurers so that virtually anyone in Germany who medically qualifies for the MyoPro can get access to it. We don’t have to go through the same type of pre-authorization hassles that we sometimes face here by some payers. We have to appeal these and so on. So patients that are medically qualified can get a MyoPro, and that’s helped drive the growth there in Germany.

Sean Lee: I see. Thanks for that. And my last question is on the advertising spend. So do you think you’ve reached a new plateau now with the advertising spend following your switch to more focus on TV? Or do you expect that to go up more in Q4? And how does that impact your pipeline? How do you expect that to impact your cost per pipeline add?

Dave Henry: Well, as I mentioned a little bit earlier, we are intending to spend more on advertising in 2026 but not at a rate of growth like we did in 2025. So the growth rate in advertising spending will be lower in 2026 versus 2025. But I think the bigger impact might be from MyoConnect and some of the efforts with the O&P channel in terms of growing the pipeline adds. And obviously, I think there’s, for dollars that we invest in advertising, more pipeline adds come from that. But we’re looking to increase the quality of the pipeline adds because, as Paul mentioned, people that are in the incidence population that the MyoConnect program is really targeting, those people are closer to their pre-stroke life in terms of what they remember what it was like before the stroke.

And so we think that they’re going to be more motivated. The quality of the pipeline should improve. And so a pipeline add overall, as the mix of patients that come from referrals and from the O&P channel increases, the conversion of those pipeline adds to revenue should increase over time. That’s the intent of doing this. And we’re doing MyoConnect with the people that we have today. So right now, we’re not spending more for it. And so those are the reasons why we’re doing it and why we think that the pipeline adds should grow, but not only that, but the quality of the adds should grow in 2026.

Sean Lee: Okay. And that does make it a lot clearer. Thanks for that. That’s all I have.

Paul Gudonis: All right, Sean. Thank you.

Operator: The next question comes from Edward Wu with Ascendiant Capital. Please go ahead.

Edward Wu: Yes. Thanks for taking my question. It looks like International Germany continues to do very well. How is the rest of your international business? And any updates on your partnership in China?

Paul Gudonis: Ed, you’ve always been a proponent and an early spotter that Germany is going to be a really good market for us. I think we validated your thesis on that. So again, Germany is growing with a growing pipeline. We expect continued record revenues next year. Other international markets, we’ve just decided we’re not going to spend a lot of money at this point to try to get reimbursement, which is a couple of year process there. From our last call with the China JV, they’re still conducting a clinical trial to get NMPA approval. So not much progress over there, but it doesn’t really cost us anything at this point. We’re just regularly engaging with management of the JV.

Edward Wu: Great. Well, thanks for the update and congratulations on Germany. And I wish you guys good luck.

Paul Gudonis: Thank you, Ed. Thank you. Operator, any more questions?

Operator: No. There are no further questions. I would like to turn the conference back over to Paul Gudonis for closing remarks.

Paul Gudonis: Well, thanks. Well, just to summarize our business plan going forward, we expect continued revenue growth through our direct-to-patient marketing as well as expanding O&P channels as we discussed here in the MyoConnect referral program. We’re increasing market access for patients by signing additional payer contracts and engaging with the Medicare Advantage and commercial plans for coverage. We’re managing our cost structure as Dave described and enhancing our manufacturing processes to demonstrate operating leverage as we scale, and we continue to innovate product development to maintain our market leadership position. Thank you all for your questions and for your interest in Myomo. We look forward to speaking to you again when we report our Q4 and full-year 2025 financial results in about four months. Have a nice evening, everyone.

Operator: Thank you. The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.