Organogenesis Holdings Inc. (ORGO) reported its financial results for the third quarter and nine months ended September 30, 2024, showing a mixed performance compared to the previous fiscal period. The company generated net revenue of $115.2 million for the third quarter, an increase of 6.1% from $108.5 million in the same period of 2023. For the nine months ended September 30, 2024, total net revenue reached $355.4 million, up from $333.5 million in the prior year, reflecting a growth of 6.6%.

The gross profit for the third quarter was $88.4 million, a 7% increase from $82.7 million in Q3 2023. For the nine-month period, gross profit rose to $270.7 million from $254.8 million, marking a 6.3% increase. However, total operating expenses also increased, with Q3 2024 expenses at $82.1 million compared to $74.7 million in Q3 2023, and nine-month expenses rising to $282.2 million from $241.0 million. This led to a decline in income from operations for the nine months, resulting in a loss of $11.5 million compared to a profit of $13.8 million in the same period last year.

Net income for the third quarter of 2024 was $12.3 million, significantly higher than the $3.2 million reported in Q3 2023. However, the company recorded a net loss of $6.8 million for the nine months ended September 30, 2024, contrasting with a net income of $5.5 million for the same period in 2023. The income tax benefit for Q3 2024 was $6.5 million, a notable improvement from an expense of $4.5 million in Q3 2023.

Strategically, Organogenesis has been active in expanding its product offerings and partnerships. In November 2023, the company entered into a trademark license and manufacturing agreement with Vivex Biologics, Inc. to sell certain products, which includes upfront licensing fees and ongoing royalty payments. The company also faced challenges with local coverage determinations (LCDs) affecting some of its products, although these were ultimately withdrawn.

The company’s cash and cash equivalents decreased to $94.3 million as of September 30, 2024, from $103.8 million at the end of 2023. Total liabilities decreased to $167.7 million from $181.4 million, while total current assets increased to $238.5 million from $225.0 million. The restructuring plan initiated in February 2023 resulted in a reduction of 71 employees, approximately 7% of the total workforce, with a total charge of $1.6 million incurred for severance payments.

Overall, while Organogenesis has seen revenue growth, it continues to navigate challenges in profitability and operational expenses, alongside strategic initiatives aimed at enhancing its market position.