Sensus Healthcare Q1 Earnings Call Highlights

Key Points

• Sensus Healthcare’s Q1 2026 revenue fell to $3.4 million from $8.3 million a year ago, mainly because it had no sales to its historically largest customer. Management said the underlying business looked stronger when excluding that one-off comparison.
• The quarter marked a major transition as new CPT reimbursement codes for superficial radiotherapy took effect on Jan. 1. Management said it spent much of the quarter educating customers, and initial reimbursement results have been positive, helping drive stronger interest and pipeline activity.
• The company is pushing recurring and utilization-based revenue through Fair Deal Agreement placements and the Sensus Link software platform. Sensus ended the quarter with $18.3 million in cash, no debt, and management expects sequential revenue improvement through 2026.

Sensus Healthcare NASDAQ: SRTS said its first quarter of 2026 marked a transition period as new dedicated CPT codes for superficial radiotherapy took effect, while revenue declined from the prior year due largely to the absence of sales to its historically largest customer.

Chairman and Chief Executive Officer Joe Sardano said the company is operating in a “fundamentally different environment” following the Jan. 1 implementation of dedicated reimbursement codes for superficial radiotherapy, or SRT. He said the company spent much of the quarter educating customers and prospects on the new coding structure and training them on how to use it.

“Initial results are excellent,” Joe Sardano said, adding that customers billing CMS under the new coding are seeing reimbursements. He said the company believes physicians and patients will gain confidence that SRT is “receiving full funding.”

Revenue Falls, But Company Cites Broader Customer Mix

Chief Financial Officer Javier Rampolla said first-quarter revenue was $3.4 million, compared with $8.3 million in the prior-year period. The decline was primarily attributed to the absence of sales to the company’s historically largest customer and a lower number of total units shipped.

Rampolla noted that the first quarter of 2025 included a significant number of direct sales to that customer, while the 2026 quarter had no sales to that customer. Excluding sales to that customer in the prior-year period, revenue increased from $2.7 million, which Rampolla said demonstrated underlying growth from a broader customer mix.

The company shipped 14 SRT systems during the quarter, including 10 direct sales and four placements under its Fair Deal Agreement program and rental arrangements. Joe Sardano said those shipments matched the fourth quarter and reflected progress in reducing historical customer concentration.

Cost of sales was $2.4 million, down from $4 million a year earlier. Gross profit was $1 million, compared with $4.4 million, while gross margin declined to 29.2% from 52.2%. Rampolla said the margin decline was primarily driven by product mix, including a higher proportion of international shipments with lower average selling prices and costs tied to new Fair Deal Agreement placements.

Net loss was $2.6 million, or $0.16 per share, consistent with the prior-year period. Adjusted EBITDA was negative $4.2 million, compared with negative $2.5 million in the first quarter of 2025.

Management Focuses on Reimbursement and Adoption

Joe Sardano outlined five priorities for 2026: educating the market on reimbursement and code usage, driving customer adoption after CPT code implementation, growing recurring and utilization-based revenue, diversifying the commercial model, and delivering sustainable profitability.

He said the new reimbursement environment has improved physician economics, including an approximately 300% increase in the per-fraction delivery code. The company reported increased inquiry levels, stronger pipeline development, and greater engagement from dermatology practices and hospital systems.

Michael Sardano, President, Chief Commercial Officer and General Counsel, said reimbursement clarity has changed how customers evaluate SRT. He said customers now have several adoption pathways, including outright purchases, leasing structures and the Fair Deal Agreement program. During the quarter, about 70% of systems shipped were purchased rather than placed under the Fair Deal Agreement program.

“Customers now have multiple pathways to adoption,” Michael Sardano said. He added that the average breakeven for customers is now two patients per month and that the company is seeing more customers choose ownership earlier in the adoption cycle.

Recurring Revenue and Sensus Link Highlighted

Management emphasized the company’s effort to expand recurring revenue tied to utilization of its installed base. Joe Sardano said treatment volumes under the Fair Deal Agreement program increased 8% from the first quarter of 2025. The company ended the quarter with 18 active FDA sites and nine pending activations.

Sensus also highlighted Sensus Link, a software platform intended to enhance workflow, treatment documentation and operating intelligence across the installed base. Joe Sardano said Sensus Link represents a scalable recurring revenue opportunity tied to treatment activity.

During the question-and-answer session, Joe Sardano said Sensus Link is already live and “performing in several accounts.” He also discussed a radiation physics consult code that he said can be billed weekly for each patient and said the company expects to share revenue with customers through Sensus Link.

Michael Sardano said total shipped systems now stand at approximately 965 units globally. He said the company expects the rollout of Sensus Link to its SRT-100 installed base to take shape this year and increase interest in SRT.

Expense Reductions and Balance Sheet

Operating expenses declined across several categories. General and administrative expense was $2 million, down from $2.2 million, primarily due to lower professional fees. Selling and marketing expense was $1.7 million, down from $2.2 million, reflecting a decision to reduce trade show-related spending and focus on events with higher sales potential. Research and development expense was $1.6 million, down from $2.6 million, reflecting lower lobbying costs related to reimbursement efforts as well as reductions in headcount and next-generation product development spending.

The company ended the quarter with $18.3 million in cash, no debt and inventory of $16.5 million, up from $14.6 million at Dec. 31, 2025. Rampolla said the inventory level positions the company to meet demand in coming quarters for both direct sales and Fair Deal Agreement placements.

Outlook Points to Sequential Improvement

Rampolla said Sensus expects second-quarter revenue to exceed first-quarter revenue and expects revenue in the second half of 2026 to be higher than in the first half. He said the company anticipates the gross margin dynamics from the first quarter to evolve as utilization under Fair Deal Agreement placements increases and revenue is recognized over time.

In response to a question from Anthony Vendetti of Maxim Group about the company’s largest customer, Joe Sardano said any return by that customer would represent upside because the company has not included that customer in its model for the year.

Management also said leads from the American Academy of Dermatology annual meeting, held at the end of March, are expected to contribute to second-quarter activity. Michael Sardano said customers only began seeing explanations of benefits from the new reimbursement codes in mid-February to early March, and that proof of payment is now being used by the sales team in the market.

Joe Sardano closed the call by saying management expects “each and every quarter” to be better than the previous one and reiterated the company’s objective of achieving full-year profitability.

About Sensus Healthcare NASDAQ: SRTS

Sensus Healthcare, Inc is a medical technology company specializing in the development, manufacture and commercialization of superficial radiation therapy (SRT) systems. The company's SRT devices utilize low-energy X-rays to treat a range of dermatological and oncological conditions, most notably non-melanoma skin cancers such as basal cell carcinoma and squamous cell carcinoma, as well as benign lesions including keloids. By delivering targeted radiation to superficial tissue layers, Sensus Healthcare's systems aim to provide an alternative to surgical excision or systemic therapies, offering clinicians a non-invasive treatment option for eligible patients.

The company's flagship products include the SRT-100™ and SRT-100+™ platforms, which feature handheld applicators, adjustable energy settings and integrated safety controls.

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