Avita Medical Q2 2025 Revenue at $18.4M, Projects $76M-$81M 2025 Revenue with Backlog Easing

Avita Medical projects $76M-$81M revenue for 2025, with a rebound expected as the claims backlog eases. In Q2 2025, commercial revenue increased 21% YoY to $18.4M, but was flat sequentially due to a temporary headwind.

Avita Medical, Inc. (NASDAQ: RCEL, ASX: AVH), a leading therapeutic acute wound care company, reported its second-quarter 2025 financial results, revealing a mixed performance marked by both growth and challenges. The company projects full-year 2025 revenue to range between $76 million and $81 million, down from previous guidance of $100 million to $106 million [1].

In the second quarter, commercial revenue increased 21% year-over-year (YoY) to $18.4 million, but was flat sequentially due to a temporary headwind related to a reimbursement issue. The company experienced a significant reduction in demand for its flagship RECELL® System due to delays in Medicare Administrative Contractor (MAC) payments to providers. This issue, which began in January 2025, led to a backlog of unpaid claims, creating uncertainty among providers and dampening demand for the RECELL System [1].

Despite the headwind, Avita Medical's gross profit margin remained strong at 81.2% for the quarter, driven by deeper penetration within customer accounts and new accounts for trauma wounds. The company's gross margin for RECELL products was 84.3% for the quarter, indicating continued profitability for its core product line [1].

Total operating expenses decreased to $26.1 million in Q2 2025 from $28.7 million in Q2 2024, primarily due to reductions in sales and marketing expenses and general and administrative expenses. The company expects to continue reducing operating expenses by approximately $2.5 million per quarter going forward [1].

Avita Medical has taken steps to address the reimbursement issue, with multiple MACs indicating their intent to adjudicate and pay claims under the new codes in July. The company anticipates a recovery in RECELL demand in the second half of 2025 as the claims backlog is resolved [1].

The company's financial results were presented on a webcast and conference call on August 7, 2025, where executives discussed the second-quarter 2025 financial results and provided an outlook for the remainder of the year.

References:
[1] https://www.nasdaq.com/press-release/avita-medical-reports-second-quarter-2025-financial-results-updates-full-year