Tactile Systems Technology Inc (TCMD) Q4 2024 Earnings Call Highlights: Strong Revenue Growth and Gross Margin Expansion

Tactile Systems Technology Inc (TCMD) reported robust financial results for the fourth quarter and full year of 2024, showcasing a 10% year-over-year revenue increase to $85.6 million and a 7% increase for the full year to $293 million. The company's gross margin improved to 75% in Q4 2024, reflecting enhanced operational efficiency and successful pricing strategies. Net income for Q4 2024 was $9.7 million, up from $8.2 million in the prior year, driven by strong sales and rentals of the lymphedema product line and a 4% increase in sales of the airway clearance product line. Adjusted EBITDA for Q4 2024 was $16.2 million, up from $15.4 million in Q4 2023, indicating strong operational performance.



Key drivers behind the 11% increase in sales and rentals of the lymphedema product line include the expanded launch of Nimbl, a next-generation pneumatic compression platform targeting the upper extremity lymphedema market, and the company's direct-to-patient model, which enables deeper market penetration and direct engagement with clinicians and patients. The company's gross margin expansion to 75.2% in Q4 2024 has significantly contributed to its profitability, as it reflects enhanced operational efficiency and successful pricing strategies. To maintain this margin, Tactile Medical has implemented several strategies, including improved operational efficiency through the deployment of new workflow-related tools and successful pricing strategies that have helped to reduce costs and improve margins.



Tactile Systems Technology Inc's financial achievements are significant in the medical devices and instruments industry, where innovation and efficiency are crucial. The company's net income for Q4 2024 was $9.7 million, or $0.40 per diluted share, compared to $8.2 million, or $0.35 per diluted share, in Q4 2023. This performance highlights the company's ability to enhance profitability while expanding its market presence. Key financial metrics for the company include an adjusted EBITDA of $16.2 million in Q4 2024, up from $15.4 million in Q4 2023, indicating improved operational efficiency. The company's balance sheet showed a strong cash position of $94.4 million as of December 31, 2024, with $26.3 million in outstanding borrowings, reflecting a solid financial foundation for future growth.

MetricQ4 2024Q4 2023Total Revenue$85.6 million$77.7 millionGross Margin75%72%Net Income$9.7 million$8.2 millionAdjusted EBITDA$16.2 million$15.4 million

Tactile Systems Technology Inc's performance in Q4 2024 demonstrates its capability to achieve revenue growth and improve profitability, essential for sustaining its competitive edge in the medical technology sector. The company's strategic initiatives, such as the expanded launch of Nimbl for lower extremity lymphedema patients, are expected to drive future growth. Looking ahead, the company projects full-year 2025 revenue between $316 million and $322 million, representing an 8% to 10% increase from 2024. This outlook reflects confidence in its market position and the potential for continued expansion.