In a noteworthy development for ProSomnus Inc, the foremost non-CPAP Obstructive Sleep Apnea Therapy provider, released its financial results for the third quarter (Q3) ending September 30, 2023. This announcement has had a profound impact on ProSomnus’ stock performance, with a notable surge in its stock value observed over the week, persisting through today’s trading session.
At the time of this publication, Prosomnus Inc stock (OSA) has witnessed a surge.
Prosomnus Inc
Current Price: $0.59
Change : +0.22
Change (%): (58.12%)
Volume: 123.4K
Source: Tomorrow Events Market Data
ProSomnus Inc Q3 2023 Financial Results
ProSomnus Inc. disclosed that its revenue for the three months concluding on September 30, 2023, reached a commendable $7.1 million. This marks a substantial 41.5% increase compared to the $5.0 million reported for the same period in 2022. The surge in revenue is attributed to heightened unit volume, driven by strategic sales and marketing investments and a notable shift in product mix towards the innovative EVO Products. ProSomnus credits the burgeoning clinical adoption of its precision devices in both the United States and Europe, along with the positive impact of an expanded field sales team during the first half of 2023, for this notable growth.
ProSomnus Inc Operational Highlights
Maintaining a consistent gross margin of 49%, the company moved into a new manufacturing facility during 2023, quadrupling its previous capacity. Although overhead costs were absorbed into product costs due to this transition, ProSomnus anticipates leveraging the expanded facility to improve gross margins as volumes increase.
Sales and marketing expenses surged by $0.9 million, a substantial 39.7% increase for the three months ending September 30, 2023, compared to the same period in 2022. This growth is primarily attributed to an expansion in personnel expenses related to the sales team and increased spending on travel and in-person events.
Research and development expenditures increased by $0.4 million, reflecting a 51.1% rise for the three months ending September 30, 2023. This spike is predominantly driven by augmented headcount-related personnel and intensified research and development initiatives.
General and administrative expenses experienced a noteworthy increase, rising by $1.8 million or 117.3% for the three months ending September 30, 2023, compared to the corresponding period in 2022. This escalation is primarily attributed to professional services and legal fees amounting to $0.9 million, headcount-related personnel costs of $0.6 million, and various other expenses totaling $0.3 million.
ProSomnus Inc Other Financial Highlights
Other income (expense) surged by $4.0 million for the three months ending September 30, 2023, compared to the same period in the previous year. This increase is a result of a $2.5 million financing loss and a $1.5 million write-off of debt financing costs associated with ProSomnus’ recent preferred stock financing transaction.
Total other income (expense) experienced a substantial increase of $5.6 million for the three months ending September 30, 2023, compared to the same period in the prior year. This surge is primarily driven by debt extinguishment and other financing losses and costs incurred in connection with the recent preferred stock financing transaction, totaling $13.7 million. These were offset by decreases in the fair value of the earnout liability ($3.9 million), senior and subordinated convertible notes ($3.7 million), and the warrant liability ($0.6 million).
Financial Position
As of September 30, 2023, ProSomnus Inc. reports a robust financial position with cash on hand totaling $12.0 million. This underscores the company’s stability and liquidity in navigating the competitive landscape.
ProSomnus’ positive financial trajectory, coupled with its innovative approach to sleep apnea therapy, positions the company as a key player in the evolving healthcare landscape. Investors and industry stakeholders will undoubtedly be closely monitoring ProSomnus Inc. as it continues to make strides in providing effective alternatives to CPAP therapy for obstructive sleep apnea.
