Release Date: November 13, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• ElectroCore Inc (NASDAQ:ECOR) reported its eighth consecutive record revenue quarter with a 45% increase to $6.6 million compared to the previous year.
• The company's gross margins remained steady at 84%, indicating strong profitability.
• The VA hospital system remains a significant customer, with sales in this channel growing 75% year-over-year.
• Tru Vega, a direct-to-consumer wellness product, saw a 147% increase in net sales, demonstrating strong market acceptance.
• ElectroCore Inc (NASDAQ:ECOR) has a robust pipeline of potential future indications and products, supported by ongoing clinical research and trials.

Negative Points

• Despite revenue growth, the company still reported a net loss of $2.5 million for the third quarter of 2024.
• Sales of the TAC-STIM product line have been variable, with a significant drop compared to the previous year.
• The company faces challenges in expanding its international presence due to certification and investment requirements.
• ElectroCore Inc (NASDAQ:ECOR) has not yet provided guidance on future revenue, creating uncertainty for investors.
• The company's growth in the VA channel is still limited, with only about 1% penetration in the total addressable headache market within the VA hospital system.

Q & A Highlights

• Warning! GuruFocus has detected 3 Warning Sign with ECOR.

Q: Can you provide more details on the Men's Health Tech Awards 2025 for Tru Vega Plus and any potential expansion plans? A: Dan Goldberger, CEO: The Men's Health recognition was unexpected but welcomed, offering a significant awareness opportunity for the Tru Vega brand. Tru Vega Plus, launched in April, has been outselling the Tru Vega 350 despite its higher price point. The future holds potential for entering larger digital health opportunities. While M&A is not a current focus, we remain committed to vagus nerve stimulation and are open to potential collaborations.

Q: Regarding the Air Force contract mentioned post-quarter, is it related to the TacStim product? A: Dan Goldberger, CEO: Yes, the contract pertains to the TacStim Black, commercialized in July. The order was filled on October 1st, marking a strong start to the fourth quarter.

Q: Will the Amazon launch of Tru Vega Plus be limited to the US, or will it expand internationally? A: Dan Goldberger, CEO: For now, Tru Vega is a US-only product. We are evaluating the investment needed for international certification but are prioritizing achieving cash positivity before expanding internationally.

Q: How can you accelerate growth in the VA channel, given the current penetration rate? A: Dan Goldberger, CEO: Growth has picked up post-pandemic as our sales team regained access to facilities. We plan to scale by adding more commission-based sales reps to penetrate existing and new hospitals. Additionally, we're working towards a PTSD label, which could significantly expand our addressable market within the VA.

Q: Can you discuss the potential for price adjustments in the FSS contracts with the VA? A: Dan Goldberger, CEO: While we have the opportunity to increase prices, we plan to maintain current pricing. Our FSS contract has been extended multiple times due to our revenue growth, and we anticipate the revised contract will retain the same pricing.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.