AVITA Medical Reports Third Quarter Results
AVITA Medical, Inc. (RCEL) filed an SEC Form 8-K — Results of Operations and Financial Condition. Exhibit 99.1 AVITA Medical Reports Third Quarter Results Delivers Strong Q3 With 53% Year-Over-Year Revenue Growth Raises Full Year 2026 Revenue Guidance VALENCIA, Calif., November 5, 2026 (GLOBE NEWSWIRE) — AVITA Medical ® , Inc. (NASDAQ: RCEL, ASX: AVH), a leading therapeutic a
How this was made
The 30-second read
Why it matters
The earnings beat and raised guidance provide fresh, material information that can drive the stock higher in the near term.
Market read
The release is a primary earnings disclosure with raised guidance, offering a clear trading catalyst for RCEL.
What to watch
Potential regulatory or reimbursement risks for RECELL procedures could temper upside.
AVITA Medical Reports Third Quarter Results Delivers Strong Q3 With 53% Year-Over-Year Revenue Growth Raises Full Year 2026 Revenue Guidance
Third-quarter total revenue increased 53% year over year and 20% sequentially to $26.1 million, gross margin expanded to 84.0%, net loss narrowed to $6.2 million, net cash use improved to approximately $0.6 million, and the Company raised full-year 2026 revenue guidance to $92 million to $94 million.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Q3 2026 sales revenueGAAP | $25.86M | – | – |
| Q3 2026 lease revenueGAAP | $252K | – | – |
| Q3 2026 total revenuesGAAP | $26.11M | 20% | 53% |
| Q3 2026 cost of salesGAAP | −$4.17M | – | – |
| Q3 2026 gross profitGAAP | $21.94M | – | – |
| Q3 2026 gross profit margin across all productsother | 84.0% | – | 270-basis point increase |
| Q3 2026 RECELL products gross marginother | 88.4% | – | – |
| Q3 2026 sales and marketing expenseGAAP | −$13.57M | – | $1.5 million increase |
| Q3 2026 general and administrative expenseGAAP | −$6.31M | – | $0.9 million decrease |
| Q3 2026 research and development expenseGAAP | −$4.70M | – | $1.0 million increase |
| Q3 2026 total operating expensesGAAP | −$24.57M | flat | 7% |
| Q3 2026 operating lossGAAP | −$2.63M | – | – |
| Q3 2026 interest expenseGAAP | −$1.48M | – | – |
| Q3 2026 other expense, netGAAP | −$2.05M | – | – |
| Q3 2026 loss before income taxesGAAP | −$6.16M | – | – |
| Q3 2026 income tax expenseGAAP | −$65K | – | – |
| Q3 2026 net lossGAAP | −$6.22M | – | – |
| Q3 2026 net loss per common share, basic and dilutedGAAP | $(0.20) | – | – |
| Q3 2026 weighted-average common shares, basic and dilutedGAAP | 30,866,230 | – | – |
| Nine-month 2026 sales revenueGAAP | $66.42M | – | – |
| Nine-month 2026 lease revenueGAAP | $652 | – | – |
| Nine-month 2026 total revenuesGAAP | $67.07M | – | – |
| Nine-month 2026 cost of salesGAAP | −$11.63M | – | – |
| Nine-month 2026 gross profitGAAP | $55.44M | – | – |
| Nine-month 2026 sales and marketing expenseGAAP | −$39.98M | – | – |
| Nine-month 2026 general and administrative expenseGAAP | −$18.34M | – | – |
| Nine-month 2026 research and development expenseGAAP | −$15.40M | – | – |
| Nine-month 2026 total operating expensesGAAP | −$73.72M | – | – |
| Nine-month 2026 operating lossGAAP | −$18.29M | – | – |
| Nine-month 2026 interest expenseGAAP | −$4.37M | – | – |
| Nine-month 2026 other expense, netGAAP | −$1.76M | – | – |
| Nine-month 2026 loss before income taxesGAAP | −$24.41M | – | – |
| Nine-month 2026 income tax expenseGAAP | $(87) | – | – |
| Nine-month 2026 net lossGAAP | −$24.50M | – | – |
| Nine-month 2026 net loss per common share, basic and dilutedGAAP | $(0.80) | – | – |
| Nine-month 2026 weighted-average common shares, basic and dilutedGAAP | 30,720,190 | – | – |
| Q3 2026 net cash useother | approximately $0.6 million | improved | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| RECELLHigher procedure volumes and increased account ordering. | $22.4M | approximately 20% growth compared to Q2 2026 | – |
| CohealyxAn expanding customer base and additional hospital value analysis committee (VAC) approvals. | $2.1M | approximately 21% growth compared to Q2 2026 | – |
| PermeaDermMaintained stable revenue; PermeaDerm I study results demonstrated comparable graft take and wound healing to allograft, with 70% lower product cost and 95.7% less preparation time. | $600K | essentially flat compared to Q2 2026 | – |
| InternationalConsistent revenue from established international markets. | $900K | essentially flat compared to Q2 2026 | – |
Full-year 2026 outlook
- Revenue$92 million to $94 million
- NoteCash flow breakeven in the fourth quarter of 2026.
- NoteRECELL products gross margin is currently expected to remain between 86% and 90% over the coming quarters.
- NoteImplied fourth-quarter 2026 revenue of $24.9 to $26.9 million.
- NoteUpdated full-year revenue range represents growth of approximately 28% to 31% compared with revenue of $71.6 million in 2025.
What drove it
- Total revenue growth was led by RECELL and supported by Cohealyx and PermeaDerm.
- Higher RECELL revenue and improvements in manufacturing efficiency supported the 84.0% gross margin.
- RECELL growth reflected higher procedure volumes and increased account ordering.
- Cohealyx growth reflected an expanding customer base and additional hospital VAC approvals.
- Operating-expense growth was largely driven by higher sales and marketing expenses, principally increased commissions and compensation including annual incentive costs.
- On November 4, 2026, the Centers for Medicare & Medicaid Services finalized national physician payment values and simplified billing codes for RECELL procedures, effective January 1, 2027.
Concerns
- Q3 2026 net loss remained $(6,222), and nine-month 2026 net loss was $(24,496).
- Current liabilities were $23,037 and total stockholders' equity (deficit) was $(31,037) as of September 30, 2026.
- Net loss for the current period was negatively impacted by $2.1 million in non-cash expense related to the revaluation of warrants due to the increase in AVITA Medical’s share price.
- The Company receives 50% of the average sales price for Cohealyx and up to 55% for PermeaDerm, which lowers the overall gross margin percentage.
- The Company cited risks including variability in volumes and hospital ordering patterns, reimbursement implementation, receivables and working-capital management, credit-facility covenant compliance, and product mix and manufacturing costs.
What to watch
- Fourth-quarter revenue implied by full-year guidance of $24.9 to $26.9 million.
- Achievement of cash flow breakeven in the fourth quarter of 2026.
- RECELL products gross margin expected to remain between 86% and 90% over the coming quarters.
- Commercial adoption of Cohealyx following additional hospital VAC approvals.
- Implementation of the national physician payment values and simplified RECELL billing codes effective January 1, 2027.
- The liquidity effect of the $10.0 million credit-facility tranche drawn subsequent to quarter-end.
Balance sheet and cash flow
- Cash and cash equivalents were $10,500 as of September 30, 2026, compared with $10,243 as of December 31, 2025.
- Marketable securities were $0 as of September 30, 2026, compared with $7,942 as of December 31, 2025.
- Cash, cash equivalents and marketable securities totaled approximately $10.5 million at September 30, 2026, compared with $11.1 million at the beginning of the quarter.
- Accounts receivable, net were $10,343 as of September 30, 2026, compared with $9,086 as of December 31, 2025.
- Inventory was $4,803 as of September 30, 2026, compared with $6,926 as of December 31, 2025.
- Total assets were $46,794 as of September 30, 2026, compared with $56,392 as of December 31, 2025.
- Loan facility, long-term was $45,476 as of September 30, 2026; loan facility was $42,984 as of December 31, 2025.
- Subsequent to quarter-end, the Company drew the remaining $10.0 million tranche, bringing total borrowings under the facility to $60 million.
- Total liabilities were $77,831 as of September 30, 2026, compared with $73,042 as of December 31, 2025.
- Total stockholders' equity (deficit) was $(31,037) as of September 30, 2026, compared with $(16,650) as of December 31, 2025.
Analysis
AVITA reported a strong third quarter, with GAAP total revenues of $26,114 versus $17,062 in the prior-year period. The release also described revenue as up 53% year over year and 20% sequentially. RECELL generated $22.4 million of Q3 U.S. revenue and grew approximately 20% versus Q2 2026, supported by higher procedure volumes and increased account ordering. Cohealyx generated $2.1 million and grew approximately 21% sequentially as its customer base expanded and hospital VAC approvals increased.
Product mix and manufacturing execution supported profitability. Gross profit was $21,941 versus $13,875, while gross profit margin across all products reached 84.0%, up 270 basis points from 81.3%. RECELL products gross margin was 88.4%. Management said that Cohealyx and PermeaDerm lower overall gross-margin percentage because the Company receives 50% of the average sales price for Cohealyx and up to 55% for PermeaDerm.
Expense control improved operating leverage despite commercial compensation costs. Total operating expenses were $(24,570), up 7% from $(23,028) in the prior-year period and described as flat to the prior quarter. Sales and marketing expense increased to $(13,566), research and development expense increased to $(4,697), and general and administrative expense declined to $(6,307). Operating loss narrowed to $(2,629) from $(9,153), while net loss narrowed to $(6,222), or $(0.20) per basic and diluted share, from $(13,187), or $(0.46) per basic and diluted share. The current-period loss included $2.1 million of non-cash warrant revaluation expense.
Liquidity remained central to the quarter. Net cash use improved to approximately $0.6 million from $3.2 million in Q2 2026, and cash, cash equivalents and marketable securities were approximately $10.5 million at September 30, 2026. The Company reached at least $85.0 million of trailing-twelve-month revenue, enabling access to the remaining $10.0 million under its Perceptive Advisors LLC credit facility. It drew that tranche after quarter-end, bringing total borrowings under the facility to $60 million, and management said the going-concern qualification was removed in the Quarterly Report on Form 10-Q.
Management raised full-year 2026 revenue guidance to $92 million to $94 million from $86 million to $89 million and reaffirmed its expectation of cash flow breakeven in Q4 2026. The updated full-year range implies fourth-quarter revenue of $24.9 to $26.9 million. The principal operating markers are sustained RECELL procedure and account growth, further Cohealyx adoption, maintenance of expected RECELL gross margin between 86% and 90%, and delivery of the stated fourth-quarter cash flow breakeven target.
Management, verbatim
AVITA delivered another strong quarter, with revenue increasing 53% year over year and gross margin reaching 84%. RECELL continued to drive our growth, supported by increasing adoption of Cohealyx, while disciplined expense management contributed to a substantial improvement in cash use. Based on our year-to-date performance and continued commercial momentum, we are raising our full-year revenue guidance and remain on track to achieve cash flow breakeven in the fourth quarter.
Cary Vance, President and Chief Executive Officer of AVITA Medical
Reaching $85 million in trailing twelve-month revenue reflects the continued execution of our commercial strategy and satisfied the revenue condition required to draw down the remaining $10 million under our credit facility with Perceptive Advisors LLC. This additional, minimally dilutive capital strengthens our liquidity as we advance toward cash flow breakeven and cash generation in the fourth quarter. Based on our improved operating performance and liquidity, management concluded that the substantial doubt about our ability to continue as a going concern has been alleviated. Accordingly, the outstanding debt under the credit facility is now classified as a long-term liability on our balance sheet.
David O'Toole, Chief Financial Officer
Not in the filing
stated, not guessed- Previous-release outlook was not provided, so no versus-prior-guidance comparison is available.
- Non-GAAP revenue, gross profit, operating income, net income, and EPS were not reported.
- Operating cash flow was not reported.
- Free cash flow was not reported.
- Share repurchases were not reported.
- Dividends were not reported.
- Full-year 2026 gross margin, operating-expense, and tax-rate guidance were not reported.
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure is checked against the filing text, and a metric the filing does not print, or whose value, prior period and change do not add up, is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.
Background
AVITA Medical (NASDAQ:RCEL) disclosed its Q3 2026 results via an SEC Form 8‑K, highlighting revenue growth, margin expansion, and a drawdown of its credit facility.
Ticker impact
AVITA Medical reported Q3 revenue up 53% YoY and raised full-year 2026 revenue guidance to $92‑$94 million.
likely upward pressure as investors price in higher revenue expectations
The earnings beat and raised guidance provide fresh, material information that can drive the stock higher in the near term.
Market effects
Strong performance in acute wound care may boost sentiment for related medical device and biotech stocks.
Positive for US-listed biotech and medical technology sector.
Limited to niche medical device market; no broad macro impact.
Counterpoint
If the cash burn remains high, the raised guidance may not translate into near‑term price gains.
Key entities
- LenderPerceptive Advisors LLC
Credit facility provider that AVITA drew down an additional $10 million tranche.
- RegulatorCenters for Medicare & Medicaid Services
Finalized payment values for RECELL procedures effective Jan 1 2027.
