IRIDEX Corporation reported its financial results for the nine months ended September 28, 2024, revealing a decline in both revenue and profitability compared to the same period in the previous fiscal year. Total revenues for the nine months were $35.973 million, down 8.7% from $39.411 million in the prior year. For the third quarter alone, revenues decreased by 9.9% to $11.581 million from $12.850 million. The decline was primarily attributed to a significant drop in revenue from the Retina product line, which fell 18% to $6.450 million, while revenue from the Cyclo G6 product increased slightly by 2.8% to $3.127 million.

Gross profit for the nine months ended September 28, 2024, was $13.916 million, a decrease of 17.8% from $16.922 million in the previous year. The gross margin also declined to 38.7% from 42.9%, reflecting higher manufacturing overhead and lower revenues. Operating expenses decreased to $21.716 million from $23.848 million, with notable reductions in sales and marketing expenses, which fell by 20.1% to $9.9 million. However, general and administrative expenses increased by 18.3% to $7.5 million.

The company reported a net loss of $8.076 million for the nine months, compared to a loss of $6.610 million in the same period last year. The net loss for the third quarter was $1.933 million, slightly higher than the $1.754 million loss reported in the prior year. Cash and cash equivalents decreased to $3.860 million from $7.034 million at the end of the previous fiscal year, indicating liquidity challenges.

IRIDEX has implemented cost-saving initiatives aimed at increasing operational efficiencies, which are expected to reduce operating expenses and improve working capital through January 2026. The company also closed a $3.4 million note with The Lind Partners, alleviating some liquidity concerns for the next 12 months.

Strategically, IRIDEX continues to focus on its partnership with Topcon Corporation, which holds exclusive distribution rights for its glaucoma and retina products in certain international regions. This partnership is critical, as Topcon accounted for 33% of total revenues for both the three and nine months ended September 28, 2024. The company is also navigating challenges posed by macroeconomic conditions, including inflation and supply chain disruptions, which have affected manufacturing and demand for its products.

Overall, IRIDEX's financial performance reflects ongoing challenges in revenue generation and profitability, alongside strategic efforts to enhance operational efficiency and liquidity.