FocalTherics NASDAQ: FOCL reported second-quarter HIFU revenue of $13.2 million, up 39% from $9.5 million a year earlier, as the company continued to expand sales of its Focal One high-intensity focused ultrasound platform for focal therapy.
Chief Executive Officer Ryan Rhodes characterized the period as a transition point for the company following its name change from EDAP to FocalTherics. The company also became a U.S. domestic filer, began reporting in U.S. dollars, and moved its ESWL and distribution businesses into discontinued operations to focus financial reporting on its HIFU business.
“We view this as a transformative moment in the evolution of our company's history,” Rhodes said, describing FocalTherics as a pure-play focal therapy company.
Capital Sales and Procedure Volumes Rise
FocalTherics recorded 13 Focal One capital-system sales in the second quarter, compared with nine in the prior-year period. The result represented a 44% increase and the company’s best second quarter for global HIFU capital-system sales, according to Rhodes.
The worldwide installed base reached 184 systems at quarter-end, including 96 systems in the U.S. and 88 internationally. In the U.S., the company recorded eight capital-system sales, including conversions of operating leases at Vanderbilt University Medical Center and the University of Michigan.
The company said 15 U.S. hospital networks have now invested in two or more Focal One systems. During the quarter, Cleveland Clinic added another system, bringing its U.S. total to four and its worldwide network total to six. Kaiser Permanente also added a second system, expanding into San Diego after launching its first program in Los Angeles.
Outside the U.S., FocalTherics completed five capital-system sales across Europe, India and Latin America. Imperial College London converted its HIFU activity from a competing platform to Focal One, Rhodes said. The company also completed a capital sale in France following universal HIFU coverage announced by the French National Health System and sold two additional systems in India.
U.S. Focal One procedure volumes increased 47% year over year. Rhodes said utilization remains primarily tied to prostate cancer treatment, while potential applications in benign prostatic hyperplasia, or BPH, and endometriosis are expected to become more meaningful over time.
Margin Improvement and Financing Update
Chief Financial Officer Ken Mobeck said HIFU gross margin rose to 55.6% from 51.1% in the second quarter of 2025. The improvement reflected lower Focal One system costs and a disciplined global pricing strategy.
Operating expenses in continuing HIFU operations were $15.4 million, compared with $11.5 million a year earlier. Mobeck said the increase in net loss included an incremental operating loss of $1.4 million, a $400,000 unfavorable foreign-exchange impact, a $6.3 million non-cash charge from changes in the fair value of European Investment Bank warrants, and interest expense related to credit-facility drawdowns.
Cash and cash equivalents totaled $21.5 million at the end of the second quarter, up from $15 million at the end of the first quarter. The company drew approximately €14 million under tranche B of its European Investment Bank credit facility in April.
FocalTherics reported negative shareholder equity of $3.2 million at quarter-end. Mobeck attributed that position to recurring losses and non-cash changes in the fair value of warrants issued to the European Investment Bank.
The company expects to close an underwritten public offering on Aug. 14 with gross proceeds of $40 million, which will be reflected in its third-quarter balance sheet. Rhodes said the proceeds are intended to support three areas: accelerated commercial growth, development and clinical work for BPH and endometriosis, and new technology development, including histotripsy.
Management reiterated full-year 2026 guidance for continuing-operations HIFU revenue of $50 million to $54 million.
Expansion Into New Indications and Technology
FocalTherics submitted a 510(k) application to the Food and Drug Administration in July for Focal Connect, a remote-connectivity technology designed to support remote maintenance, proctoring and peer-to-peer clinical collaboration.
The company is also advancing a BPH clinical program. Fourteen patients have been treated in its Latin American study, and the first U.S. BPH patients are planned for treatment later this year in New York, according to Rhodes.
In endometriosis, Toulouse University Hospital in France became the site of the company’s first commercial program in Europe. More than 10 additional hospitals in Europe, the U.K. and Latin America are proceeding through clinical training, Rhodes said. He added that three Focal One system sales in the first quarter were associated with hospitals’ ability to use the platform for both prostate cancer and endometriosis.
Rhodes said revenue from endometriosis is expected to remain small in the near term and may begin to ramp more meaningfully in 2027. In the U.S., the company has received a breakthrough-device designation for the endometriosis application and expects a manuscript from a randomized controlled trial to be published later this year.
FocalTherics also plans to invest in histotripsy development. Rhodes said the company has filed patents related to the program and sees a potential one- to two-year development horizon, subject to achieving key milestones.
Reimbursement and Commercial Outlook
CMS has proposed an approximately 12% increase in HIFU facility payment for 2027 versus the 2026 rate. If finalized, Rhodes said it would mark the fifth consecutive annual increase in the Medicare facility payment for Focal One robotic HIFU. The final rule is expected in late fall.
Management said it is pursuing a qualified pipeline of roughly 300 additional deals, while emphasizing that the figure does not represent the company’s full addressable market. Rhodes also cited growing interest among Veterans Affairs and military health facilities following the company’s agreement with MellingMedical to broaden access within government accounts.
Looking ahead, FocalTherics said it remains focused on commercial execution across U.S. and international hospital networks, as well as advancing BPH and endometriosis toward broader commercialization.
About FocalTherics (NASDAQ:FOCL)
EDAP TMS SA, together with its subsidiaries, develops, produces, markets, distributes, and maintains a portfolio of minimally invasive medical devices for the treatment of urological diseases in Asia, France, the United States, and internationally. It operates in three segments: High Intensity Focused Ultrasound (HIFU), Extracorporeal ShockWave Lithotripsy (ESWL), and Distribution Services (DIST). The HIFU segment develops, manufactures, and markets medical devices based on HIFU technology for the minimally invasive treatment of urological and other clinical indications.
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 contact@marketbeat.com.
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