AVITA Medical Plunges 16.29% Despite Revenue Surge

On May 9, 2025, AVITA Medical's stock experienced a significant drop of 16.29% in pre-market trading, reflecting investor concerns and market reactions to recent developments.

AVITA Medical reported its first-quarter 2025 financial results, highlighting a 67% increase in commercial revenue to $18.5 million compared to the same period in 2024. This growth was driven by deeper penetration within customer accounts and new product launches, including the RECELL GO mini and Cohealyx. The company's gross profit margin stood at 84.7%, slightly lower than the previous year due to volume discounts and a higher inventory reserve.

The company's transformation of its commercial organization, shifting from a service-oriented to a selling-oriented model, is expected to drive scalable growth. AVITA Medical also announced the nationwide launch of Cohealyx, a collagen-based dermal matrix, and the RECELL GO mini, designed for smaller wounds. These launches expand the company's market opportunity from $455 million to over $3.5 billion in the U.S.

Despite the positive developments, AVITA Medical's net loss for the quarter was $13.9 million, or $0.53 per share, compared to a net loss of $18.7 million in the same period last year. The company expects to generate free cash flow in the second half of 2025 and achieve GAAP profitability in the fourth quarter. AVITA Medical's financial guidance for the full year 2025 remains unchanged, with commercial revenue expected to be in the range of $100 to $106 million, reflecting growth of approximately 55% to 65% compared to the full-year 2024.