STRATA Skin Sciences Reports $33.6M Revenue with Reduced Net Loss in 2024

STRATA Skin Sciences, Inc. reported a net revenue of $33.6 million for the fiscal year ending December 31, 2024, reflecting a slight increase of 1% from $33.4 million in 2023. The company experienced a gross profit of $19.1 million, up from $18.5 million the previous year, resulting in a gross margin improvement from 55.2% to 56.8%. Despite this positive trend in revenue and gross profit, STRATA recorded a net loss of approximately $10.1 million, compared to a loss of $10.8 million in the prior year, indicating a reduction in losses year-over-year.

The company’s operational performance was impacted by a decrease in domestic revenues, which fell by 9% to $20.9 million, while international revenues increased by 23% to $12.7 million. The decline in domestic sales was attributed to a reduction in the number of XTRAC treatments performed, which the company estimates at approximately 253,000 treatments in 2024, down from 280,000 in 2023. This decrease was partly due to a reduction in direct-to-patient advertising efforts. In contrast, revenues from the dermatology procedures equipment segment increased by 5% to $12.4 million, driven by higher international sales.

Strategically, STRATA has made significant moves, including a reverse stock split of one-for-ten shares effective June 6, 2024, aimed at regaining compliance with Nasdaq listing requirements. The company also amended its credit facility with MidCap Financial Trust, allowing for additional borrowing and clarifying cash collateral provisions. Furthermore, STRATA has focused on expanding its international presence, signing distribution agreements in various countries, including Mexico and India, to enhance its market reach.

As of December 31, 2024, STRATA had 106 full-time employees, an increase from 102 in the previous year, reflecting its commitment to strengthening its workforce to support growth initiatives. The company has also faced challenges, including ongoing sales tax audits in New York and California, with an aggregate assessment of $5.2 million, which has led to increased scrutiny of its financial practices. The company has accrued $1.8 million related to these tax liabilities as of the end of 2024.

Looking ahead, STRATA Skin Sciences anticipates continued operational challenges due to external factors such as the ongoing impacts of the COVID-19 pandemic, supply chain disruptions, and geopolitical tensions, particularly the Russia-Ukraine conflict. The company aims to enhance its marketing efforts to increase patient awareness of its XTRAC treatments and expects to leverage its existing cash reserves and anticipated revenues to support its operations over the next 12 months. However, the company acknowledges the potential need for additional financing to sustain its growth trajectory and manage its operational costs effectively.