Vericel NASDAQ: VCEL reported record first-quarter revenue and raised its full-year 2026 outlook, citing strong growth across its MACI cartilage repair franchise and Burn Care business, as well as expected NexoBrid procurement revenue from a new federal contract.
President and Chief Executive Officer Nick Colangelo said the company delivered “outstanding financial and commercial results across the business” in the quarter and achieved several objectives that management believes position Vericel for continued revenue, profit and cash-flow growth in 2026.
Total revenue rose 30% year over year to $68.4 million, which management said was significantly above its guidance range. MACI revenue increased 22% to a record first-quarter level of $56.4 million, while Burn Care revenue rose more than 90% to $12 million.
Chief Financial Officer Joe Mara said Vericel posted its “strongest first quarter to date across all key financial measures,” including revenue, profitability and cash generation. Gross margin expanded more than 300 basis points to 72%, while adjusted EBITDA increased 195% to $9.6 million. Adjusted EBITDA margin rose nearly 800 basis points to 14%.
The company also generated $16.4 million in operating cash flow and $15.1 million in free cash flow. Vericel ended the quarter with approximately $211 million in cash and investments, up nearly $50 million from the end of the prior-year first quarter.
MACI Growth Supported by Sales Force Expansion
Management highlighted MACI’s performance as a key driver of the quarter. Colangelo said double-digit volume growth drove the franchise’s record first-quarter revenue and noted that MACI’s trailing four-quarter revenue growth rate increased to 23%, compared with 19% in the prior four quarters.
The first quarter was also the first full period in which Vericel’s expanded MACI sales force operated in newly aligned territories. Colangelo said the larger sales organization helped the company generate record first-quarter biopsies, implants, biopsy surgeons and implanting surgeons. He also said the quarter included the second-highest number of biopsies and biopsy surgeons in any quarter since MACI’s launch.
Colangelo said implant growth accelerated during the quarter in both new and legacy territories, and biopsy growth was especially strong in new territories. He added that biopsy pull-through to implants improved during the quarter, which management said could support higher conversion rates over time.
In response to an analyst question, Colangelo said the sales force expansion had caused “absolutely zero disruption” during the transition and that he did not think the rollout “could have gone any better.” Mara said the company has been encouraged by the early performance of new sales representatives, while noting that growth reflected contributions from both new and legacy territories.
MACI Arthro Remains a Focus
Vericel also discussed continued adoption of MACI Arthro, the company’s arthroscopic delivery approach for MACI. Colangelo said Vericel trained approximately 1,000 surgeons on MACI Arthro in 2025 and that trained surgeons already account for more than half of MACI implants.
Management said leading indicators in the small condyle segment remain strong, with higher first-quarter and trailing biopsy growth rates than the overall biopsy growth rate. Colangelo also said surgeons who have completed MACI Arthro cases have shown higher biopsy conversion rates to date.
Colangelo said early data from ongoing investigator case series suggest reduced post-surgical pain, improved range of motion and faster achievement of full weight-bearing after MACI Arthro treatment. He said the initial data were recently accepted for publication and could support shorter rehabilitation and recovery timelines.
Asked whether peer-reviewed data could catalyze further adoption, Colangelo said clinical data are important and compared the opportunity to Vericel’s experience with patella use for MACI. He said publications over time helped support broader coverage and utilization in that segment.
Burn Care Revenue Rises, BARDA Contract Adds NexoBrid Visibility
Burn Care revenue of $12 million exceeded Vericel’s guidance range and represented one of the company’s highest Burn Care revenue quarters to date. Mara said Epicel revenue was particularly strong at $10.9 million, while NexoBrid revenue was $1.1 million, up nearly 60% from the fourth quarter.
Colangelo attributed Epicel’s strength to biopsy growth and improved conversion of biopsies into grafts. He said the medical and commercial teams are focused on increasing the treatment rate for patients whose biopsies are received.
Vericel also discussed a Biomedical Advanced Research and Development Authority, or BARDA, award valued at up to $197 million for procurement and advanced development of NexoBrid. The base contract is valued at $35 million and includes approximately $10 million over the next 12 months for initial procurement, vendor-managed inventory services and initial development work for a potential blast trauma injury indication.
Colangelo said about two-thirds of the value of the BARDA award would flow to Vericel in one form or another, including procurement, inventory-related service revenue or cost offsets. Mara said Vericel expects $5 million to $6 million of NexoBrid BARDA procurement revenue in the second half of 2026, beginning in the third quarter.
Guidance Raised for 2026
Vericel raised its full-year 2026 total revenue guidance by $10 million and now expects revenue of $326 million to $336 million. At the midpoint, that represents approximately 20% growth.
The company increased its MACI revenue guidance to $282 million to $288 million, up from $280 million to $286 million. For the second quarter, Vericel expects MACI revenue of approximately $62.5 million to $63.5 million.
Vericel also raised its Burn Care revenue outlook to approximately $44 million to $48 million, compared with prior guidance of $36 million to $40 million. Second-quarter Burn Care revenue is expected to be approximately $9 million to $10 million.
Mara said the guidance increase reflects first-quarter outperformance and expected NexoBrid BARDA revenue, while noting that the company is maintaining a prudent approach for the remainder of the year. He said the MACI outlook assumes high-teens growth for the second quarter and the back half of the year and does not assume an acceleration in the second half.
For the full year, Vericel continues to expect gross margin of approximately 75% and adjusted EBITDA margin of approximately 27%. The company expects second-quarter gross margin of approximately 72% and adjusted EBITDA margin of approximately 18%.
Manufacturing and International Expansion
Colangelo said Vericel achieved FDA approval for MACI commercial manufacturing at its new facility, with manufacturing beginning in the second quarter. He said the approval increases manufacturing capacity for MACI in the U.S. and supports potential commercialization outside the United States.
Vericel remains on track to submit a MACI marketing application in the U.K. later this year, with a potential launch in 2027 if approved. Colangelo said the U.K. is an attractive initial market because of surgeon awareness, prior experience with MACI and a positive NICE opinion issued in the late 2010s.
During the Q&A, management said it has not seen signs of broader orthopedic procedure pressure affecting MACI. Colangelo said Vericel had a strong December and saw double-digit biopsy and implant growth in the first quarter. Mara said the company has not built any expected procedural slowdown into its guidance.
Colangelo closed the call by saying Vericel is positioned to deliver a “unique combination of sustained high revenue growth, profitability, and cash generation” in 2026 and beyond.
About Vericel NASDAQ: VCEL
Vericel Corporation is a biotechnology company specializing in the development, manufacturing and commercialization of cell-based therapies for patients with severe diseases and conditions. The company's expertise lies in regenerative medicine, where it harnesses the power of autologous cell processing to create products designed to restore function and promote healing in damaged tissues.
Vericel currently markets two FDA-approved therapies. MACI® (autologous cultured chondrocytes on porcine collagen membrane) is indicated for the repair of symptomatic cartilage defects of the knee in adult patients.
Read More
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.
Before you consider Vericel, you'll want to hear this.
MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Vericel wasn't on the list.
While Vericel currently has a Moderate Buy rating among analysts, top-rated analysts believe these five stocks are better buys.
View The Five Stocks Here
Thinking about investing in Meta, Roblox, or Unity? Click the link to learn what streetwise investors need to know about the metaverse and public markets before making an investment.
Get This Free Report
