Vivos Therapeutics Q3 2025: Contradictions Emerge on Revenue Growth, Margins, and Cost Efficiency

Date of Call: None provided

Financials Results

• Revenue: $6.8M in Q3 2025, up 76% YOY (vs $3.9M in Q3 2024) and up 78% sequentially; 9M 2025 revenue $13.6M, up ~20% YOY (vs $11.3M)
• Gross Margin: 58% for Q3 2025, compared to 60% in Q3 2024

Guidance:

• Revenue expected to continue growing as SAMC centers scale and more providers are credentialed
• Ramp to optimized revenue levels expected to take ~3–6 months as new doctors/nurse practitioners are licensed and credentialed
• Steady-state SAMC contribution margins targeted at roughly 50%–60%
• Cash-flow breakeven is a company goal tied to accretion from SAMC centers and further affiliations/acquisitions
• MISleep (Detroit) expected operational in early December; patient bookings in Las Vegas extend into Feb 2026

Business Commentary:

• Revenue Growth and SCN Acquisition:
• Vivos' revenue increased by 76% to $6.8 million in Q3 2025 compared to Q3 2024, and by 78% sequentially.

• The growth was mainly driven by the acquisition of Sleep Center of Nevada (SCN) in June, which resulted in additional sleep testing and treatment revenue.

• Cost Structure and Expansion:

• Cost of sales increased by 87% to approximately $2.8 million due to investments in integrating SCN, including appliance fees, SCN operations, staff compensation, and software services.

• These increased costs were necessary for expanding facilities and hiring additional personnel to meet high patient demand.

• Gross Profit and Margin fluctuations:

• Gross profit increased by approximately $1.6 million, leading to a gross margin of 58%, which is a slight decrease from the previous year's margin of 60%.

• The change in margin was influenced by the higher increase in cost of sales relative to revenue, primarily due to acquisition-related investments.

• Operational Profitability and Future Prospects:

• Vivos aims for cash flow breakeven, as its new model is expected to be highly accretive to revenue and contribution margins, with steady-state contribution margins projected at 50% to 60%.
• The company expects that as new dental providers and nurse practitioners are licensed and credentialed, revenue growth will outweigh expenses, leading to improved profitability.

  Sentiment Analysis:

  Overall Tone: Positive

  • "We are very excited... the pivot to our sleep medical practice acquisition and strategic alliance model is taking hold."; Management called Q3 "a watershed quarter and an inflection point" and repeatedly highlighted scalable, accretive SAMC economics and continued revenue growth.

Q&A:

• Question from Lucas Ward (Ascendiant Capital Markets): So now that we have this acquisition in the mix, how should we model sales for the next few quarters? Like what's the growth potential?
  Response: Expect material top-line growth as SCN-driven diagnostic and treatment revenue scales; growth is currently limited by the number of licensed/credentialed providers, and adding those providers will drive significant incremental revenue.

• Question from Lucas Ward (Ascendiant Capital Markets): So there's an upfront investment in personnel and then sort of a delayed benefit in terms of revenues. Like how big is that gap? Is it a quarter or 2?
  Response: Management expects a ramp to optimized revenue levels of approximately 3–6 months as providers complete licensing and credentialing.

• Question from Lucas Ward (Ascendiant Capital Markets): In terms of the additional operating expenses that we saw in this quarter, presumably some of that was sort of onetime or acquisition related. I'm just wondering like what would be reasonable in terms of operating expenses like next quarter or the quarter after?
  Response: At steady state SAMC operations should generate contribution margins in the ~50%–60% range, which is the basis for long-term operating expectations.

• Question from Lucas Ward (Ascendiant Capital Markets): Last question on cash flow breakeven, can you give us an update on your -- kind of your goal there?
  Response: The clear goal is cash-flow breakeven; achievement is tied to practice-level profitability from SAMC centers as affiliations and acquisitions scale, though no precise timing was provided.

• Question from Robert Sassoon (Water Tower Research): Under the new business model and with revenues on the rise, how should investors look at the company now and in 6 months from now?
  Response: This quarter is an inflection point; the model is replicable and scalable—investors should monitor the pace of new affiliations and SAMC deployments over the next 6–12 months as indicators of growth toward profitability.

• Question from Robert Sassoon (Water Tower Research): How does the recognition of revenue differ between the various models?
  Response: For acquisitions (e.g., SCN) Vivos recognizes product shipment revenue and OSA diagnostic/treatment revenue; in contractual alliances Vivos often recognizes appliance sales as principal and arrangements dictate fee structures or splits of gross profit/net income.

Contradiction Point 1

Revenue Growth and Model Scalability

It involves differing expectations regarding the growth trajectory and scalability of the new business model, which could impact investor expectations and strategic planning.

With the acquisition, how should we model sales for the next few quarters? What is the growth potential? - Lucas Ward(Ascendiant Capital Markets)

20251120-2025 Q3: We expect top line revenues to continue to grow. The key element is adding dental providers and nurse practitioners to our teams, which are the revenue source. - R. Huntsman(CEO)

With this acquisition completed, how should we model sales for the next few quarters and what is the growth potential? - Lucas Ward(Ascendiant Capital Markets LLC, Research Division)

2025Q3: The company expects top-line revenues to grow significantly. The key growth driver is the addition of new dental providers and nurse practitioners, which will ramp up over 3 to 6 months. - R. Huntsman(CEO)

Contradiction Point 2

Operating Expenses and Cost Efficiency

It highlights differing expectations regarding operating expenses and cost efficiency, which are critical for financial forecasting and investor confidence.

What is a reasonable expectation for operating expenses in the next quarter or the following quarter given the additional operating expenses this quarter? - Lucas Ward(Ascendiant Capital Markets)

20251120-2025 Q3: At steady state, SAMC operations should contribute margins of 50% to 60%. These margins are anticipated to remain consistent as the model stabilizes. - R. Huntsman(CEO)

Regarding the additional operating expenses this quarter, presumably some were one-time or acquisition-related. What should be considered a reasonable level for operating expenses in the next quarter and the following quarter? - Lucas Ward(Ascendiant Capital Markets LLC, Research Division)

2025Q3: At steady state, the new operations are expected to generate contribution margins of 50% to 60%. - R. Huntsman(CEO)

Contradiction Point 3

Revenue Growth Expectations

It involves differences in expectations regarding revenue growth, which are critical for investor projections and company strategy.

With the acquisition now part of the business, how should we model sales growth for the next few quarters? - Lucas Ward(Ascendiant Capital Markets)

20251120-2025 Q3: We expect top line revenues to continue to grow. The key element is adding dental providers and nurse practitioners to our teams, which are the revenue source. - R. Huntsman(CEO)

How should we think about Q3 and Q4 revenue compared to Q2? - Scott Henry(AGP)

2025Q2: We increased revenue around $800,000 from Q1 to Q2 to $3.8 million and that was a 27% growth. - Bradford Amman(CFO)

Contradiction Point 4

Profitability and Cost Management

It involves changes in financial forecasts, specifically regarding profitability and cost management, which are critical indicators for investors.

Given the increased operating expenses this quarter, what is a reasonable expectation for operating expenses in the next two quarters? - Lucas Ward(Ascendiant Capital Markets)

20251120-2025 Q3: At steady state, SAMC operations should contribute margins of 50% to 60%. These margins are anticipated to remain consistent as the model stabilizes. We expect expenses to rightsize with revenues as we fully deploy our teams, aligning costs with revenue growth. - R. Huntsman(CEO)

How will the Sleep Center of Nevada acquisition impact P&L, and when will it become accretive? - Lucas Ward(Ascendiant Capital Markets)

2025Q1: We expected to see significant revenue and profitability improvements in the third quarter. Diagnostic services and patient bookings are already growing. - Kirk Huntsman(CEO)