$TNON earnings report

Tenon Medical reported third quarter 2026 revenue of $1,432 thousand, up from $1,173 thousand in the third quarter of 2025, a 22% increase that the Company says reflects more surgical procedures and continued adoption of the SImmetry+ System. Nine-month revenue was $4,090 thousand against $2,463 thousand, a 66% increase. The filing states revenue grew 12% sequentially from the second quarter, although the second-quarter absolute figure is not printed in the documents. Gross profit was $950 thousand, a 66.3% margin against 65.9% a year earlier, which the Company attributes to fixed-cost absorption and improved Catamaran per-procedure costs following a July 2, 2026 510(k) clearance for reusable instrument status. The nine-month gross margin of 66.2% compares with 54.4% in the prior-year period.

Operating expenses were $4,035 thousand against $4,165 thousand, and the loss from operations narrowed to $(3,085) thousand from $(3,392) thousand. The mix shifted within that total. General and administrative expense fell to $1,517 thousand from $2,199 thousand, which the Company ties to lower professional service fees, while research and development rose to $804 thousand from $428 thousand and sales and marketing rose to $1,714 thousand from $1,538 thousand. Nine-month operating expenses rose to $12,428 thousand from $11,267 thousand, so the year-to-date cost base is higher even though the third quarter was lower.

Below the operating line, the picture changed sharply. Total other expense, net was $(3,554) thousand, including other income (expense), net of $(2,878) thousand and interest expense of $(719) thousand. The Company attributes the wider net loss of $(6,639) thousand, or $(5.39) per share, against $(3,339) thousand, or $(14.17) per share, primarily to $3.1 million of warrant inducement expense and $0.7 million of non-cash debt discount amortization. Weighted-average shares rose to 1,231 thousand from 236 thousand, reflecting the financings and the 1-for-35 reverse split effective August 10, 2026. Per-share comparisons are therefore not a like-for-like read of underlying performance.

The balance sheet changed materially. Cash and cash equivalents rose to $8,271 thousand from $3,756 thousand at December 31, 2025, after approximately $15.6 million of aggregate gross proceeds in the quarter across a public offering, a private placement, a warrant inducement, at-the-market sales and warrant exercises. The senior convertible notes were repaid in full and the Company reports no outstanding debt at quarter-end. Stockholders' equity increased to $9,218 thousand from $5,040 thousand, and accumulated deficit reached $(95,467) thousand. The filing carries substantial doubt language about the Company's ability to continue as a going concern, and no operating or free cash flow figures are presented in the documents.

Management's stated priorities are physician training and adoption, pipeline progress, and spending discipline. Product and commercial milestones include the full commercial launch of the 3D-printed lateral screw for the SImmetry+ System, alpha cases for the Quickstep Decorticator with full market release targeted for Q1 2027, eight new U.S. patents in 2026, and the hire of a Chief Revenue Officer effective October 1, 2026. The read for investors is that top-line growth and gross margin are moving in the right direction and the balance sheet has been rebuilt, but the reported net loss, the financing dependence and the going concern language remain the central issues. No guidance was provided in the filing.

Tenon reported strong year-over-year top-line and gross-profit growth in the second quarter. Revenue was $1.3 million, up 127% from $0.6 million, while gross profit was $0.8 million, up 232% from $0.2 million. Management attributed revenue growth primarily to a significant increase in surgical procedures and the addition of SImmetry®+ System revenue. Revenue for the six months ended June 30, 2026 was $2.7 million, an increase of 106% compared to $1.3 million in the year-ago period.

Gross margin reached 64%, compared with 43% in the second quarter of 2025, and six-month gross margin was 66%, compared with 44%. The company attributed the quarterly margin improvement to higher revenue and lower fixed costs, which increased absorption of production overhead within cost of goods sold. Management also cited growth in case volume across the Catamaran® and SImmetry®+ platforms, while the July 510(k) clearance moved certain Catamaran® instruments from disposable to reusable status, which the company expects to reduce ongoing per-procedure costs.

Operating investment rose alongside commercial activity. Operating expenses totaled $4.2 million versus $3.1 million, with sales and marketing expense of 1,869 (In thousands), research and development expense of 768 (In thousands), and general and administrative expense of 1,531 (In thousands). The company cited higher sales expenses associated with revenue, an expanded commercial team, the SImmetry®+ rollout, and increased research and development work toward future product additions. Loss from operations was (3,354) (In thousands), compared with (2,857) (In thousands).

The net loss widened to $4.1 million from $2.8 million. The filing attributed the increase largely to non-cash interest expense of $0.9 million related to amortization of original issue discount on convertible notes, partially offset by higher other income of $0.1 million related to gains on the change in fair value of the derivative liability. Cash and cash equivalents were $1.7 million at June 30, 2026, while convertible notes were 4,332 (In thousands) on the balance sheet and the company stated that its $5.2 million convertible notes mature on September 11, 2026, extendable to December 11, 2026.

After quarter end, Tenon closed a public offering with gross proceeds of $4.2 million and net proceeds of approximately $3.6 million. The company intends to use proceeds for partial repayment of convertible notes, commercial expansion, clinical research, product development and general corporate purposes, but stated there can be no assurance it will repay or refinance the notes in full. July also produced the company’s highest monthly surgical case volume to date following a 98% increase in physician and distributor training events in the first half of 2026 compared to the second half of 2025. The filing provided no quantitative financial guidance.