Neuronetics 2025 Q2 Earnings Beats Expectations as Net Loss Narrows 54.5%

Neuronetics (NASDAQ: STIM) reported second quarter 2025 financial results that exceeded revenue expectations and showed a meaningful reduction in net loss per share. The company revised its full-year guidance and confirmed plans for positive cash flow in Q4 2025, signaling improved operational efficiency despite ongoing losses.

Revenue
Total revenue surged 131.7% year-over-year to $38.11 million, driven by the acquisition of Greenbrook. Greenbrook clinic revenue reached a record $23.0 million, now representing over 60% of total revenue. U.S. NeuroStar Advanced Therapy System revenue decreased 13% to $3.5 million, while treatment session revenue declined 8% to $10.8 million, though both showed pro forma growth.

Earnings/Net Income
The company narrowed its net loss to $0.15 per share in Q2 2025, down from $0.33 per share in Q2 2024, a 54.5% improvement. However, the net loss widened to $9.84 million from $9.83 million in the prior year period, as the lower-margin clinic business from Greenbrook pressured gross margins to 46.6% from 74.0%. Despite improved cash usage, Neuronetics continues to operate at a loss.

Price Action
Following the earnings release, the stock price of Neuronetics surged 10.58% on the day and 33.68% month-to-date, though the post-earnings trading strategy underperformed the benchmark with a -14.55% return over 30 days.

Post-Earnings Price Action Review
A post-earnings trading strategy involving buying Neuronetics shares after the revenue beat and holding for 30 days underperformed with a -14.55% return, compared to the benchmark. The strategy’s CAGR was -5.28%, with a maximum drawdown of 0% and a Sharpe ratio of -0.05, indicating significant risk and poor returns.

CEO Commentary
Keith Sullivan, President and CEO, highlighted the company’s 18% adjusted pro forma revenue growth, record clinic revenue, and reduced cash burn of $3.5 million—$1.5 million below guidance. He expressed confidence in achieving positive cash flow from operations in 2025 and emphasized the strategic value of the Greenbrook acquisition, while welcoming new CFO Steven Pfanstiel to drive growth and profitability.

Guidance
For the third quarter of 2025, Neuronetics expects revenue between $37.0 million and $39.0 million. The company maintains full-year revenue guidance of $149–$155 million but revised gross margin expectations to 48–50%, citing the integration of Greenbrook and margin pressure. Operating expenses are now forecasted at $100–$105 million, up from prior guidance, with cash flow turning positive in Q4 2025 rather than Q3.

Additional News
The company secured an additional $10 million in debt funding from Perceptive Advisors in August 2025 under the existing agreement, extending its minimum liquidity requirement to September 2026. Neuronetics also reported clinical data showing NeuroStar TMS’s strong efficacy in treating depression among adolescents and young adults, reinforcing its FDA-cleared use in younger populations. The appointment of Steven Pfanstiel as CFO, effective July 15, 2025, marks a strategic shift to enhance operational integration and financial management following the Greenbrook acquisition.