Zomedica's Q1 2025 Results: Can This Vet Tech Innovator Turn the Tide?

Investors will scrutinize Zomedica Corp.’s (OTC: ZOMDF) first-quarter 2025 financial results, set to be released on May 15, 2025, at 4:30 p.m. ET. The veterinary health company, which designs diagnostic and therapeutic products for companion animals and horses, faces a critical juncture: Can it sustain revenue growth while narrowing its net losses and regaining investor confidence after a turbulent year?

Key Takeaways from the Q1 2025 Outlook

1. Revenue Growth Momentum: Zomedica’s diagnostics segment, led by its TRUFORMA in-clinic testing platform and VetGuardian monitoring systems, has been a bright spot. In 2024, diagnostics revenue surged 109% year-over-year in Q4 alone. Investors will look for signs this growth is accelerating into 2025.
2. Path to Profitability: Despite an 8% revenue increase in 2024 to $27.3 million, Zomedica reported a net loss of $47 million. The company aims to reduce costs further—via operational efficiency moves like its recent headquarters relocation—and achieve a $50 million revenue run rate, which CEO Larry Heaton calls “aggressive” but achievable.
3. Market Access and Innovation: Zomedica’s CE-marked products now target the lucrative European market, while new launches like VETIGEL’s U.S. distribution deal and equine-focused tools could expand its $2 billion addressable market.

Business Update & Strategic Initiatives

Zomedica’s Q1 update is likely to highlight progress on its product pipeline, which includes:
- VETIGEL: A plant-based hemostatic gel distributed under a January 2025 deal with Cresilon, targeting surgical and emergency care.
- TRUFORMA Assays: Five new assays launched in 2024, with plans for 5–6 more in 2025, including equine PPID diagnostics.
- Equine Market Expansion: The VetGuardian no-touch monitoring system and EquiLOOP therapeutic device are targeting a growing segment of equine veterinarians.

The company has also prioritized operational efficiency:
- A 19% reduction in leased office space in Ann Arbor, Michigan, saving $200,000 annually.
- New robotic manufacturing lines in Minnesota to reduce labor costs for TRUFORMA assays.

Financial Performance & Challenges

While Zomedica’s balance sheet remains robust—$71.4 million in cash and securities as of December 2024—the stock’s delisting from the NYSE in March 2025 (due to a sub-$0.10 share price) has been a major setback. Trading now on the OTCQB under ZOMDF, the stock has slumped 61% over 12 months, reflecting investor skepticism about its path to profitability.

Key Risks:
- High Operating Expenses: Total 2024 expenses rose 16% to $70.1 million, driven by R&D and the Qorvo Biotechnologies acquisition.
- Therapeutic Devices Struggles: PulseVet, its shockwave therapy product, grew just 4% in 2024, hinting at execution challenges in capital equipment sales.
- Shareholder Confidence: Despite $375,000 in insider buying in March 2025, the stock remains volatile, with a price target of $0.25 suggesting a potential 363% upside from its March lows.

What to Watch in the Q1 Earnings Call

1. Revenue Growth by Segment: Can diagnostics maintain its double-digit growth? How is PulseVet performing post-acquisition?
2. Margin Improvements: Gross margin held steady at 70% in 2024—will cost-cutting efforts translate to narrower losses?
3. International Expansion: Has CE-marked product adoption in Europe and the Middle East started contributing meaningfully?
4. Strategic Acquisitions: Management has hinted at potential partnerships. Are there updates on M&A activity to bolster its pipeline?

Conclusion: Betting on Innovation, But Risks Remain

Zomedica is a company with a compelling product roadmap and a $2 billion addressable market, yet its ability to turn the corner hinges on execution. Its diagnostics segment, fueled by TRUFORMA’s real-time testing and VetGuardian’s remote monitoring, is a clear growth engine. The VETIGEL distribution deal and international CE approvals are also strategic wins.

However, the path to profitability is steep. To reach a $50 million revenue run rate—a 83% increase from 2024—Zomedica must grow diagnostics even faster while reigning in costs. The May 15 earnings call will be pivotal. If management can demonstrate:
- Revenue acceleration in diagnostics and equine markets,
- Reduced cash burn (non-GAAP cash burn was $20.4 million in 2024), and
- Clear milestones toward relisting on a major exchange,

then investors may begin to see the stock’s valuation—currently at a ~$56.8 million market cap—catch up to its potential.

But the road is littered with risks: regulatory delays, supply chain hiccups, and execution in capital equipment sales could derail progress. For now, Zomedica is a high-risk, high-reward play for investors willing to bet on veterinary tech innovation. The next quarter’s results will test whether this innovator can turn the tide—or if it remains adrift in a choppy market.