Senestech Q3 2025 Earnings Report

Senestech EPS Results

• Actual EPS: -$0.28
• Consensus EPS: -$0.35
• Beat/Miss: Beat by +$0.07
• One Year Ago EPS: N/A

Senestech Revenue Results

• Actual Revenue: $0.69 million
• Expected Revenue: $0.73 million
• Beat/Miss: Missed by -$40.00 thousand
• YoY Revenue Growth: N/A

Senestech Announcement Details

• Quarter: Q3 2025
• Date: 11/10/2025
• Time: After Market Closes
• Conference Call Date: Monday, November 10, 2025
• Conference Call Time: 5:00PM ET

Senestech (NASDAQ:SNES) is an animal health company focused on fertility-control solutions for managing rat populations. Its technology is designed to reduce rodent reproduction rather than relying solely on traditional lethal poisons, with potential applications in commercial, agricultural, industrial and urban environments.

The company’s primary product is ContraPest, a liquid bait formulated to reduce fertility in both male and female rats. SenesTech has also developed Evolve Soft Bait, a fertility-control product intended to provide an alternative delivery format for rodent population management. The products are designed for use by pest-management professionals and other customers seeking integrated rodent-control programs.

Founded in 2004 and headquartered in Flagstaff, Arizona, SenesTech has pursued regulatory approvals and commercial distribution for its products in the United States. The company’s business is centered on expanding the use of fertility control as part of integrated pest-management practices, including in settings where conventional rodenticides may present operational or environmental concerns.

Senestech Q3 2025 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Record Q3 results: total revenue of $690,000 (+43% YoY), sustained ~63% gross margins, and the company's best-ever Adjusted EBITDA loss of $1.2M, with management saying there's a clear near-term pathway to profitability.
• Positive Sentiment: Channel expansion accelerated growth — e-commerce was up 55% YoY, brick-and-mortar sales rose 254% YoY (Ace, Bradley), municipal revenue grew 139% YoY, and Lowe's.com now carries Evolve with a possible 100‑store in‑store test planned.
• Positive Sentiment: Balance sheet and funding optionality: cash was >$10M at quarter-end and management believes they can reach profitability without an immediate equity raise; 2.2M short-term warrants at $5.25 could inject ~ $11.4M if exercised and an ATM remains available.
• Negative Sentiment: Legal risk: SenesTech is defending an IP/ND A lawsuit from Levitech that generated more than $100k of one‑time legal expense this quarter and could lead to further costs or uncertainties.
• Negative Sentiment: Concentration risk: e-commerce accounted for 54% of sales with Amazon as the dominant marketplace, leaving revenue sensitive to platform advertising dynamics and pricing decisions.

Presentation

[Operator]

Evening and welcome to the SenesTech Reports Third Quarter Fiscal Year 2025 Financial Results Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing star followed by zero on your telephone keypad. Please note this event is being recorded. I would now like to turn the conference over to Robert Blum with Lytham Partners. Please go ahead.

[Robert Blum, Managing Partner at Lytham Partners]

All right. Thank you very much, Operator. And as you just mentioned, thank you, everyone, for joining us to discuss SenesTech's Third Quarter 2025 Financial Results. And this is for the period ended September 30th, 2025. With us on the call today is Mr. Joel Fruendt, the company's Chief Executive Officer, Mr. Tom Chesterman, the company's Chief Financial Officer. At the conclusion of today's prepared remarks, we will open the call for a question-and-answer session. If you are listening through the webcast portal and would like to ask a question, you can submit your question through the Ask a Question feature in the webcast player. Before we begin with prepared remarks, we submit for the record the following statement.

[Robert Blum, Managing Partner at Lytham Partners]

Statements made by the management team of SenesTech during the course of this conference call may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 as amended, and Section 21E of the Securities Exchange Act of 1934 as amended. Such forward-looking statements are made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements describe future expectations, plans, results, or strategies, and are generally preceded by words such as may, future, plan or planned, will or should, expected, anticipates, draft, eventually, or projected.

[Robert Blum, Managing Partner at Lytham Partners]

Listeners are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements as a result of various factors and other risks identified in the company's filings with the Securities and Exchange Commission. All forward-looking statements contained during this conference call speak only as the date in which they were made and are based on management's assumptions and estimates as of such date. The company does not undertake any obligation to publicly update any forward-looking statements, whether as a result of the receipt of new information, the occurrence of future events, or otherwise. With that said, let me turn the call over to Joel Fruendt, Chief Executive Officer of SenesTech. Joel, please proceed.

[Joel Fruendt, CEO at SenesTech]

Thank you, Robert, and good afternoon, everyone. Thank you all for joining us today for our Third Quarter 2025 Conference Call. We once again had a very strong quarter with record quarterly revenues driven by the rapid adoption of our evolved product line, which is showing growth across nearly every one of our key distribution channels and market verticals. E-commerce continues to be our largest channel, representing more than 50% of our revenue and was up 55% year over year. And as many of you saw, we had a very exciting announcement as our products are now available at lowes.com. The intersection of our e-commerce and brick-and-mortar retail sales has the opportunity to be a significant growth driver for us moving forward, and Lowe's fits perfectly into that intersection.

[Joel Fruendt, CEO at SenesTech]

But as we have been communicating to you for the past year or so, our objective is clearly not to just grow at any cost. We need to reach profitability and believe we have the pathway to do so in the near term. Yes, high-margin revenue growth will be the easiest pathway there, but efficiently managing our expenses will be an equal part of the equation, and we are doing just that. During the quarter, we had a robust 43% increase in year-over-year sales. Gross margins continued in the 63% range, and operating expenses were down 4% compared to last year and down 12% sequentially. And note that we had more than $100,000 of one-time legal expenses during the quarter that, if removed, would have shown even further OpEx improvements.

[Joel Fruendt, CEO at SenesTech]

Overall, our adjusted EBITDA loss, which closely tracks our cash utilization, was the best in our company's history at $1.2 million. This compares favorably to $1.4 million last year in the most recent sequential quarter. With a continued focus on high-margin revenue growth, operational efficiency, and cost discipline, we are poised to achieve our profitability objectives. Given the strong progress we continue to make, we feel very comfortable with the cash position we have, which at the end of September was more than $10 million. We will continue to execute and make incremental progress towards our profitability objectives, and we see a potential path to the future that may not require further equity offerings. That's the high-level overview of the quarter: record revenues, strong gross margins, reduction in our operating expenses, all of those resulting in the best adjusted EBITDA in the company's history.

[Joel Fruendt, CEO at SenesTech]

And finally, a strong balance sheet, which will bridge us to profitability. Okay, let's transition to a few key activities that took place since we last spoke in August and some items we are working on, which we'll hopefully develop in the months to come. First off, as I mentioned a moment ago, our e-commerce business continues to show strong growth. Amazon continues to lead the way here with double-digit monthly growth. We continue to focus on being efficient with our advertising spend, ensuring that we don't spend during seasonally slower times for deployment. To that end, we slowed spends during late July and August and then re-ranked our ad spend in early September. We had a highly successful Labor Day special that really boosted our sales in the month of September and should set the stage for a strong Q4 from Amazon as well.

[Joel Fruendt, CEO at SenesTech]

Beyond Amazon, which represents about 50% of our e-commerce revenue, we also are seeing growth from our existing senestech.com websites, as well as walmart.com, homedepot.com, and tractorsupply.com. We had the big announcement about lowes.com that has started carrying our Evolve Rat product. This expansion represents a major milestone in both consumer accessibility and retail distribution possibilities for the company. Launching on lowes.com is a key component of our planned expansion through the broader retail channels. As we have talked about in the past, many retailers start new products on their e-commerce platforms to assess overall potential and then transition to having them placed in their brick-and-mortar locations. We have a compelling case with Lowe's, Walmart, Home Depot, and others that, as the e-commerce side of the equation gains traction, we may then expand to in-store offerings in the future.

[Joel Fruendt, CEO at SenesTech]

We look forward to this being a large opportunity for us moving forward in the near future. During the quarter, our retail sales were up 254% compared to the year-ago period, driven by expanded adoption that more than doubled its coverage with our Ace Hardware customer. And follow-on orders from Bradley Caldwell, a wholesaler serving over 8,000 retail locations in the Northeast. Beyond e-commerce and retail, we continue to see adoption of our solutions within the municipal markets as well. During the third quarter, municipal revenue grew 139% year-over-year, driven by expanded deployments in New York City, Chicago, and Baltimore, reflecting increased adoption in diverse urban settings. In September, we announced that Evolved Rat Birth control would be deployed in another of Chicago's special service areas, this time SSA number 48, or the Old Town area.

[Joel Fruendt, CEO at SenesTech]

The new initiative led by the Old Town Merchants & Residents Association is focused on improving sanitation and public health in one of Chicago's most historic and vibrant neighborhoods. Planned deployments include strategic alleyways throughout the SSA, which spans key commercial and residential areas. SSA number 33, or the Wicker Park Bucktown Special Service Area of Chicago, has expanded deployments in their area as well. We are working with the other 53 SSAs as they seek to implement an evolved program. On a recent visit to Wicker Park Bucktown, a customer remarked, "We now see in a week the rat activity we used to see in a day. It's good to have such simple articulation of evolved's efficacy." These current programs continue to focus on controlled deployments in high-impact areas, laying the groundwork for potential large-scale expansion.

[Joel Fruendt, CEO at SenesTech]

And further, the overall awareness of these municipal deployments continues to have a positive impact on other channels, such as retail, e-commerce, and pest control distribution. In New York City, our rat contraceptive pilot program is showing exceptional results. Our team has been in New York supporting the deployment, where they continue to note 100% consumption of Evolve. We are working with New York City for reorders to advance the trial. In addition, we are working with local distributors to arrange for long-term supply to the city. While many of the headlines come from e-commerce channels such as Amazon, Home Depot, Walmart, Lowe's, etc., or our deployments in hardware retailers like Ace Hardware, or municipal deployments in New York City or Chicago, the continued utilization of our solutions from pest management professionals, or PMPs, continues.

[Joel Fruendt, CEO at SenesTech]

Representing nearly 20% of our third quarter revenues, PMP revenue was up 72% sequentially from the second quarter, as a wide variety of PMP partners are leveraging the unique attributes of fertility control across a wide range of customer applications, including theme parks. One of these theme parks is internationally known and is now in their third monthly order cycle. Our diverse distribution channel was clearly demonstrated during the quarter with near across-the-board growth from our various market verticals and distribution channels. With multiple shots on goal, each of which has shown stable growth and strong upside characteristics, such as a large deployment in a major retailer or a large-scale deployment in a municipal area, we feel very good about the future.

[Joel Fruendt, CEO at SenesTech]

Before I turn to Tom to review the financials in more detail, with the growth we expect, we have taken important steps to make sure we are structurally ready to meet this growth. Last quarter, we took the important step to increase our production capacity to meet future demand. We have officially completed our move into our new, larger facility in the Phoenix area with new automated capabilities designed to increase efficiency. So with that being said, let me turn the call over to Tom to review the financials in more detail. I will then make a few closing comments before we turn it over to your questions. Tom?

[Tom Chesterman, CFO at SenesTech]

Thank you, Joel. Let me take a moment to expand on the numbers in the press release and a few points that Joel mentioned in his earlier remarks. On the revenue line, total revenue for the second quarter was 690,000, which was an increase of 43% from Q3 of last year and up 10% sequentially. Breaking it down further, evolved revenue increased 77% and accounted for 85% of our third quarter sales. ContraPest decreased approximately 31% and accounted for 15% of our Q3 sales. While down from a year-ago period, ContraPest was basically flat from Q2, as there are still a number of loyal ContraPest customers. Looking at it from the vertical break-in, e-commerce was clearly our largest contributor, coming in at 54% of our overall Q3 sales. Overall, e-commerce was up 55% compared to our Q3 of last year and up 6% sequentially.

[Tom Chesterman, CFO at SenesTech]

As Joel mentioned, we dialed down unprofitable ad spend over the summer vacation period and re-ranked it up on Labor Day. We continue to see Amazon growth at double digits monthly. Our second largest vertical is pest management professionals, or PMPs, which accounted for 19% of our Q3 sales and was up 29% year-over-year and up 72% sequentially. Municipal sales, while still a relatively small percentage of total sales, saw a 139% increase from the year-ago quarter, driven by new deployments in Chicago and New York. Brick-and-mortar sales were up 254% year-over-year, driven by the expansion of Ace Hardware and Bradley Caldwell. Other contributors during Q3 were in the areas of agribusiness, commercial, as well as zoos and sanctuaries. One item to point out is that we had very nominal revenue during the quarter from international sales.

[Tom Chesterman, CFO at SenesTech]

The groundwork has been set, and we simply need to wait for progress in terms of approvals, etc. We have communicated previously that this is a process, and we believe we are making good progress. Turning to gross margins and gross profits as a whole, for the third quarter, gross margins remained strong at 63%. The transition to the new facility will continue to show efficiencies and improvements in gross margins. Looking at it from a gross profit dollar perspective, gross profit was $433,000 compared to $315,000. More broadly speaking, the higher gross margins of evolved continue to be a key driver to our improved financial performance. On the OpEx line, operating expenses were down 4% compared to last year and down 12% sequentially. As Joel mentioned, we had more than $100,000 of extraordinary expenses during the quarter that, if removed, would have showed even further OpEx improvements.

[Tom Chesterman, CFO at SenesTech]

We continue to focus on being as efficient as possible within our expense structure, focusing on profitable ad spend and the overall cost structure. The revenue growth, improved gross profit dollars, and decreased OpEx resulted in our lowest adjusted EBITDA loss in the company's history as we focus on achieving our goal of profitability. For the quarter, adjusted EBITDA loss was just $1.2 million, and excluding the extraordinary items would have been $1.1 million. Coinciding with the improved bottom-line results is a balance sheet cash balance that has the ability to allow us to reach profitability without proactively raising any additional diluted capital. Clearly, the ramp of revenues is the biggest unknown, but at the current sequential pace of growth and gross margin and OpEx structure, there is clearly a path where we do not need to proactively raise additional diluted capital.

[Tom Chesterman, CFO at SenesTech]

I'll remind everyone that we do have additional capital potential if we need it, including 2.2 million short-term warrants outstanding at 525 per share, which, if exercised, would potentially bring in more than $11.4 million. And we have an ATM that is currently dormant. Let me now turn the call back to Joel. Joel?

[Joel Fruendt, CEO at SenesTech]

Thanks, Tom. The adoption of our Evolved rodent birth control solution continues to be a game-changing solution, which has significantly opened up the addressable market opportunity for us. We have numerous shots on goal for continued, steady, sequential growth with outsized opportunities for what I would define as transformational growth that has the ability to quickly catapult us to profitability. We feel very good about our broad approach to expanding adoption of evolved, and the results to date are reaffirming our strategies. With a large addressable global market that has shown regulatory tailwinds in our favor, a first-mover advantage in rodent birth control, a diverse and scalable go-to-market strategy that is producing results, and a lean-focused growth strategy which balances revenue growth with operational efficiencies, I couldn't be more excited about the position SenesTech is in today. As always, I thank you all for your interest in SenesTech.

[Joel Fruendt, CEO at SenesTech]

With that, I'm happy to open up the call to questions. Robert, let me turn the call over to you to see if there are any questions in the webcast portal.

[Robert Blum, Managing Partner at Lytham Partners]

Great. Thank you very much, Joel, and Tom, for your prepared remarks there. Again, as a reminder to everybody listening in through the webcast portal there, if you'd like to ask a question, you can type it into the Ask a Question feature there on the webcast player. All right, we have a few questions here, gentlemen. The first one is, will we see the company's products in Lowe's brick-and-mortar stores?

[Joel Fruendt, CEO at SenesTech]

And I'd say the answer to that is we are in discussions with them. The first step was the e-commerce, but we're also talking to them about doing a test deployment in about 100 stores. So stay tuned. I think the expectations are that there'd be some time at the end of Q2.

[Robert Blum, Managing Partner at Lytham Partners]

Okay. Very good. Next question here is, do you have visibility on PMP-driven sales? What kind of growth are you expecting from this channel?

[Joel Fruendt, CEO at SenesTech]

Well, PMP is certainly a key growth channel for us and one of our massive market verticals. We've had 20% accounted for 20% of our sales, which was up significantly over the last quarter and the year-ago period. So we see that growing at significant levels as we go along, as more of the customers, the pest control operators become aware that birth control is indeed another part of an integrated pest management program. And we're starting to see that by the reorders that we're getting.

[Robert Blum, Managing Partner at Lytham Partners]

All right. Very good. A couple of questions here on e-commerce. I think you addressed some of this in your prepared remarks, but how much of the revenue of the 690,000 was from e-commerce?

[Joel Fruendt, CEO at SenesTech]

Well, it accounted for 54% of our quarterly revenue. That has been consistent with some of the other quarters that we've had in the past.

[Robert Blum, Managing Partner at Lytham Partners]

All right. Expanding on e-commerce here, a question here is, Evolve is priced much higher than other rat control products on Amazon. With your big margins, you have lots of room to cut price. Is that part of your sales strategy going forward?

[Joel Fruendt, CEO at SenesTech]

Well, what we did is we've positioned Evolve kind of in the middle of the pricing pack with different rodenticides that are out there. We monitor that closely, and we think that when the time is right, then we may have to discount a little bit in order to gain some large orders. We're willing to do that, but we're really comfortable where our price point is now, and I think our double-digit growth on Amazon monthly is proof of that.

[Robert Blum, Managing Partner at Lytham Partners]

All right. Very good. Next question here. There's actually a number of international questions, so I'll try to summarize a few of these. First off here, could you give just sort of basic general details on your progress in the international markets?

[Joel Fruendt, CEO at SenesTech]

Yeah. Great news from New Zealand. We got the official approval for New Zealand. New Zealand has a program where they want to limit out pests by 2050, rodents and a couple of other pests. We got the approval there. We have our distribution set up there, so we're in the process of working on, okay, what does that order look like that we're shipping to New Zealand? And we have a number of those areas. We have now 18 exclusive distributors who are all working every day to get those country approvals. And it may take a little bit longer than what we would like. Sometimes in countries, it takes a little bit longer than others, but we know that once we get approvals in the countries, that the container load orders are going to follow there. And so we're really excited about that.

[Joel Fruendt, CEO at SenesTech]

We're being very patient, and at the same time, we're pressing forward. So we expect many more country approvals over the course of the next three months.

[Robert Blum, Managing Partner at Lytham Partners]

All right. Very good. I hope that that addressed most of the questions that were on here internationally. Again, I'll remind everybody that if there are any questions you have, I would like to type them in through the webcast player. Please try to get those submitted here. Next question pertains to the legal expense. Any additional color that can be provided on that?

[Joel Fruendt, CEO at SenesTech]

Tom, you want to take that? Okay. Looks like Tom's not on. We have some legal expense. We have the—

[Tom Chesterman, CFO at SenesTech]

Sorry.

[Joel Fruendt, CEO at SenesTech]

Go ahead.

[Tom Chesterman, CFO at SenesTech]

Oh, I'm sorry. I had my mute on. Sorry about that. Yeah. As we've disclosed in our filings, we are being sued by Levitech, a rodenticide manufacturer, that we did some joint research with a while back. They claim we violated our non-disclosure agreement and infringed on their IP. We can't really comment specifically on the litigation, but I will say this. I mean, their assertions are baseless. It's bordering on ridiculous. And to some extent, I think the SenesTech and rodent birth control in general is beginning to scare the poison companies. They're now realizing that Evolve may hurt their business, and they're doing what they can to stop it. So I suppose that's a positive signal for our future in a strange way.

[Robert Blum, Managing Partner at Lytham Partners]

All right. Very good.

[Robert Blum, Managing Partner at Lytham Partners]

Next question here is, could you give an estimate on how much revenue is expected from recent field trials that started in Somerville and Cambridge? Anything you can add on to that?

[Joel Fruendt, CEO at SenesTech]

I think it's too early to project revenues. All I can say is this: those trials are going very well and that they're looking for a long-term solution. We're very confident that as we have the positive results from these trials, the orders will follow. It's very similar to the third monthly order in a row from one of the large theme parks. They try it out. They do their own internal work to make sure that it's something they want to use. Once they realize that this is a way to end infestations, the orders will follow. We think that there's going to be some really good things coming from both of those areas.

[Robert Blum, Managing Partner at Lytham Partners]

All right. Very good. Well, I am showing no additional questions here or topics. So I guess with that, Joel, I'll go ahead and turn it back over to you for any closing remarks.

[Joel Fruendt, CEO at SenesTech]

Well, thanks, everyone, again, for being on the SenesTech earnings call. We've been working hard. I think you can see by the results that a lot of our legwork is starting to pay off, and we're expecting even better things going forward. So thank you for your time, and look forward to talking to you again after the first of the year.

[Operator]

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

Participants

Analysts

• Tom Chesterman, CFO at SenesTech
• Joel Fruendt, CEO at SenesTech
• Robert Blum, Managing Partner at Lytham Partners