EDAP TMS S.A. Updates 2025 Revenue Guidance: Core HIFU Business to Grow 26%-34%, Non-Core ESWL and Distribution Business to Decline 25%-30%.

EDAP TMS S.A. has updated its earnings guidance for 2025, with core HIFU business revenue expected to grow 26%-34% YoY and non-core ESWL and distribution revenue expected to decline 25%-30% YoY. This compares to previous guidance of 16%-25% YoY growth in core HIFU and 20%-25% decline in non-core ESWL and distribution.

EDAP TMS S.A. has revised its earnings guidance for the year 2025, indicating a significant shift in its business strategy. The company now expects its core HIFU business revenue to grow within the range of 26% to 34% year over year (YoY), compared to its previous guidance of 16% to 25% YoY. Meanwhile, combined non-core ESWL and Distribution business revenue is projected to decline within the range of 25% to 30% YoY, a significant change from the previous guidance of 20% to 25% YoY decline [1].

These updates reflect EDAP's strategic focus on its high-margin HIFU business, as evidenced by the strong performance in the second quarter of 2025. The company reported exceptional growth in its core HIFU business, with a 76.8% YoY increase in revenue to EUR 8.5 million, driven primarily by nine Focal One system sales compared to three in Q2 2024 [2]. Total revenue reached EUR 16.0 million, up 1.6% YoY, despite a 30.9% decline in non-core business revenue.

EDAP's decision to pivot towards its high-margin HIFU business has resulted in improved gross margins, rising to 42.5% in Q2 2025 from 37.5% in Q2 2024. However, this strategic shift has also led to a decline in overall revenue growth, with total revenue increasing by only 1.6% YoY. The company continues to operate at a loss, with Q2 2025 net loss of EUR 5.6 million, but has secured a significant credit facility letter of intent with the European Investment Bank, valued at EUR 36 million, to support its expansion plans [2].

EDAP's Focal One HIFU system is gaining significant clinical adoption, driven by robust clinical evidence and strategic expansion into new indications. The company's strong operational momentum is supported by the upcoming launch of the new Focal One i Robotic HIFU System and its planned investment in "new indications and further development of focused ultrasound technologies" [2].

The company's updated financial guidance and strategic pivot signal management's increased confidence in its growth trajectory. EDAP's Focal One HIFU system is demonstrating accelerating clinical adoption, with a 140% net placement growth in the second quarter of 2025. This growth is supported by compelling clinical evidence, including the FARP Randomized Controlled Trial and the multicenter HIFI study [2].

Despite the strong operational momentum, EDAP continues to operate at a loss, with Q2 2025 operating losses at EUR 5.8 million. Cash reserves have decreased to EUR 16.3 million from EUR 22.8 million at the end of Q1 2025. However, the upcoming EIB facility should alleviate near-term capital concerns [2].

EDAP's strategic focus on its high-margin HIFU business is clearly paying off, with gross profit margins expanding to 42.5% from 37.5% in the comparable period. The company's decision to focus on its high-margin HIFU business is driving higher gross margins, but this transition is creating a drag on overall results, with total revenue only increasing 1.6% to EUR 16.0 million due to the intentional 30.9% decline in non-core business revenue [2].

EDAP's Focal One HIFU system is gaining significant clinical adoption, supported by robust clinical evidence and strategic expansion into new indications. The 140% growth in Focal One placements demonstrates accelerating clinical adoption of HIFU technology for prostate cancer treatment. This growth isn't happening in a vacuum - it's being driven by compelling clinical evidence, particularly the FARP Randomized Controlled Trial and the multicenter HIFI study, both providing Level 1 evidence supporting focal therapy's efficacy [2].

The company's upcoming launch of the new Focal One i Robotic HIFU System indicates continued innovation in the platform. For medical technologies, iterative platform improvements are essential for maintaining competitive advantage and expanding clinical utility. While details on the enhancements in this new system aren't provided, the timing alongside increasing clinical evidence suggests EDAP is coordinating product development with market education efforts - a strategy that typically accelerates adoption in medical technology markets [2].

EDAP TMS S.A. is scheduled to host a conference call and webcast today, August 28th, at 8:30 a.m. EDT. The company will also attend and present at the upcoming H.C. Wainwright 27th Annual Global Investment Conference in New York City from September 8-10, 2025.

References:
[1] https://www.marketscreener.com/news/edap-tms-s-a-updates-earnings-guidance-for-the-year-2025-ce7c50dfd18cff23
[2] https://www.stocktitan.net/news/EDAP/edap-reports-strong-second-quarter-2025-hifu-w8tumi5mflu6.html