Ceribell, Inc. Q1 FY2025 earnings call

Key Highlights:

• Strong Q1 revenue growth with total revenue at $20.5M, 42% y-o-y and 11% q-o-q growth.
• 558 active accounts, with first cohort of VA hospitals integrating clarity algorithm post FDA ATO in Nov 2024.
• Received FedRAMP high authorization, only 51 companies and sole medical device maker with this.
• On track to expand commercial organization to 55 territory managers by mid-2025.
• FDA 510(k) clearance for pediatric clarity seizure detection, plan limited commercial release and pilot.
• Pipeline: Neonate Clarity and Delirium on track, pediatric clearance first step in core seizure market.

Operational:

• Invested in R&D and commercialization, leveraging AI and clinical evidence to expand addressable market.

Total revenue for the first quarter of 2025 was $20.5 million, reflecting 42% growth over the same period last year and 11% growth over the fourth quarter of 2024. Product revenue was $15.6 million, an increase of 41% from the first quarter of 2024. Subscription revenue was $4.9 million, an increase of 45% from the first quarter of 2024. Gross margin for the first quarter was 88%.

Revenue:

• Full-year 2025 revenue guidance raised to $83M-$87M from prior $81M-$85M, 27%-33% y-o-y growth.

Gross Margin:

• Expect mid-80s percent gross margin, impact of tariffs on gross margin less than 10% until Q4 2025, with mitigation strategies like automation, cost negotiation, reshoring.

Cash Flow:

• Confident in reaching cash flow breakeven with current cash on hand.

• Dynamic trade environment and tariffs pose potential impact on gross margin.
• Regulatory and commercialization pathways have unique dynamics with high synergy and interdependency.

Q: Congrats on the good quarter, raised full-year guide. What's driving the guide raise beyond the beat and cadence?

A: Greater confidence in strategies on account and account management, high usage per account growth Q1 over Q4, additional quarter of visibility and execution.

Q: Tariffs and gross margin confidence? Any mitigation actions?

A: Trade environment dynamic, have runway on inventory, mitigation strategies include automation, cost negotiation, reshoring, waiting for trade policy clarity.

Q: OpEx and pediatric software approval contribution to 2025 guidance?

A: OpEx includes investments from IPO, pediatric CLARITY not factored in 2025 guidance, full launch to drive future revenue.

Q: Utilization rates, seasonality, CAM initiatives?

A: Seasonality due to ICU census, winter higher usage; CAM focuses on disease awareness, physician education, departmental expansion.

Q: Competitive landscape, clinical evidence?

A: No significant competitive threats, clear category leader with unmatched tech, clinical evidence, and patents.

Q: Pediatric clarity SKU, hardware, internal permeation?

A: Hardware approved for all ages, existing headbands used; internal permeation from ICU to ER via hospital workflow and recommendations.