Revenue for the third quarter of 2025 totaled $5.0 million, a 32% decline from the $7.4 million reported in the same period a year earlier. The drop is largely attributable to a scope change with a large national health‑plan client that reduced the company’s one‑time sales volume, while the shift toward high‑margin recurring contracts has begun to offset the top‑line impact.
Gross profit reached $3.0 million, giving a GAAP gross margin of 60% versus 52% a year earlier. Non‑GAAP gross margin on the core B2B2C business remained above 80%, reflecting the company’s successful transition to a higher‑margin, subscription‑based model. The margin expansion helped keep operating costs in check, but the revenue decline still left the company with a GAAP operating loss of $10.47 million for the quarter.
Operating loss of $10.47 million was offset by a stronger-than‑expected earnings per share of $‑1.85, beating the consensus estimate of $‑2.63 by $0.78 (a 29.7% improvement). The EPS beat was driven by disciplined cost management and the higher mix of recurring revenue, which helped maintain profitability despite the revenue shortfall.
The company reiterated its guidance that it expects to reach cash‑flow breakeven by late 2026 to early 2027. It also highlighted a robust pipeline, with $69 million in commercial opportunities projected for 2026 and $5 million in newly committed annual recurring revenue outside the pharmaceutical segment. These forward‑looking metrics suggest the company is positioning itself for long‑term profitability as it continues to scale its high‑margin model.
Chief Financial Officer Chen Franco Yehuda said the quarter “strengthened our financial position, supported by an oversubscribed $17.5 million private placement that underscores investor confidence in our digital‑health strategy.” Chief Executive Officer Erez Raphael added that the company’s focus on “high‑margin recurring contracts generating 60% GAAP and 80%‑plus non‑GAAP gross margins” is “significantly improving our financials, driven by continued margin expansion, cost discipline, and a robust balance sheet.”
The content on BeyondSPX is for informational purposes only and should not be construed as financial or investment advice. We are not financial advisors. Consult with a qualified professional before making any investment decisions. Any actions you take based on information from this site are solely at your own risk.