What Myomo (MYO) Said on Its Q3 Earnings Call

Key Points

• Myomo reported record Q3 revenue of $12.3 million, up 22% year over year, with gross margin rising to 71.3% and adjusted EBITDA near break-even. Its net loss widened to $4.2 million from $3.7 million.
• Recurring patient sources contributed 54% of revenue, up from 33% a year earlier, while MyoPro orders increased 13% to a record 258. The company is expanding payer access, and management said MyoConnect referrals convert to revenue at roughly 10 times the rate of advertising-driven leads.
• Myomo narrowed its 2026 revenue guidance to $46 million–$47 million and expects second-half cash burn below $2 million. It also plans to bring customized brace-shell 3D printing in-house by year-end and continues development of the MyoPro3 and a hand-only device.

Myomo NYSEAMERICAN: MYO reported record third-quarter revenue of $12.3 million, up 22% from a year earlier, and narrowed its full-year revenue guidance as referrals and higher sales of its powered arm braces helped improve operating performance.

The company reached approximately break-even adjusted EBITDA, compared with a loss of $2.7 million in the prior-year quarter. Its net loss widened, however, to $4.2 million, or $0.10 per share, from $3.7 million, or $0.09 per share, a year earlier.

Chief Executive Officer Paul Gudonis said revenue growth, higher gross margin and improved operating results reflected progress in building referral sources, expanding payer access, controlling costs and investing in product development and research.

Revenue Growth and Improved Margins

Myomo recognized revenue on a record 222 MyoPro units in the quarter, up 19% from a year earlier. The average selling price rose approximately 2% to $55,500, Chief Financial Officer Dave Henry said.

Gross margin increased to 71.3% from 63.8% a year earlier. Henry attributed the improvement primarily to higher average selling prices, material cost reductions and the spreading of fixed costs across more units, partially offset by higher clinical costs.

Operating expenses rose 6% to $10.5 million, while the operating loss narrowed to $1.7 million from $3.5 million. Henry noted that some of the improvement in adjusted EBITDA reflected higher stock-based compensation, as certain employee incentive payments were made in stock to manage cash. He expects stock-based compensation to return to its typical run rate in the fourth quarter.

Myomo ended September with $11.9 million in cash, cash equivalents and short-term investments. Its cash balance declined by $1.5 million during the quarter, compared with a $2.2 million decline in the second quarter.

Referrals and Payer Access Expand

Recurring patient sources represented 54% of third-quarter revenue, compared with 33% a year earlier. Those sources include rehabilitation hospitals and stroke clinics, orthotics and prosthetics partners, and the Department of Veterans Affairs.

Gudonis said healthcare professionals at more than 500 rehabilitation facilities and therapy centers have referred potential MyoPro patients through the company’s MyoConnect program since its launch, an increase of more than 200 locations in the past quarter. About 30% of recent referrals came from facilities with prior experience with the product, he said.

Myomo received a record 258 MyoPro orders, up 13% year over year. It added 600 patients to its pipeline, down from the second quarter, and ended the period with a backlog of 217 patients.

Henry said summer scheduling difficulties and temporary staffing constraints affected MyoConnect pipeline additions, while inefficiencies in direct-to-patient advertising produced fewer workable leads and a lower conversion rate. The staffing constraints have eased, and direct billing pipeline additions in October were approximately 30% higher than the third quarter’s monthly average, he said. Henry cautioned that advertising is typically seasonally lower in the fourth quarter.

Management said referrals through MyoConnect tend to be better qualified medically and for reimbursement than those generated through direct-to-patient advertising. Henry said MyoConnect pipeline additions convert into revenue at a rate about 10 times higher than advertising-driven additions.

Myomo also entered or was finalizing payer agreements covering an additional 35 million lives, Gudonis said. The company is enrolled with Medicaid programs in seven states, although coverage remains subject to individual medical policies. Management said in-network payer contracts generally result in higher authorization rates.

Outlook and Product Development

Myomo narrowed its 2026 revenue guidance to $46 million to $47 million from $45 million to $47 million. Management expects a modest sequential increase in fourth-quarter gross margin from manufacturing cost reductions, alongside a modest increase in operating expenses tied to a chief commercial officer transition and additional MyoConnect staffing.

The company maintained its target of limiting full-year operating expense growth to half the rate of revenue growth. It also expects second-half cash burn of less than $2 million, including less than $500,000 in the fourth quarter.

Gudonis said Myomo plans to bring 3D printing of customized brace shells in-house by year-end. A University of Utah randomized controlled trial had enrolled 35 of a planned 50 participants, up from 25 at the time of the second-quarter call.

Development continues on the MyoPro3 and a hand-only device for Germany. Gudonis said the hand product is expected to be released in Germany in 2027 and later brought to the United States. For now, he said, Myomo is concentrating its European investment in Germany rather than opening new markets.

Henry declined to provide 2027 revenue guidance or a specific operating leverage target while the company completes its planning. He said management expects gross margins to remain in the low 70% range as it moves into 2027.

About Myomo (NYSEAMERICAN:MYO)

Myomo, Inc is a medical device company that develops and markets wearable robotic braces designed to help individuals with impaired upper-limb function regain movement and perform activities of daily living. Its principal product is the MyoPro, a lightweight, electrically powered orthosis that detects a user's residual muscle signals and assists movement of the arm and hand.

The MyoPro is intended for people affected by neuromuscular disorders and injuries, including stroke, brachial plexus injury, multiple sclerosis, traumatic brain injury and spinal cord injury.

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