IRIDEX CORP
For the period ended Jun 28, 2025. Filed Aug 12, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 28, 2025 · Filed Aug 12, 2025
IRIX$0.66-3.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-29; filed 2025-05-13.
0000950170-25-070469
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-28; filed 2025-08-12.
0000950170-25-107375
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 55 previous paragraphs and 72 current paragraphs.
37 unchanged; 16 reworded; 14 added; 2 removed; 0 previous and 5 current paragraphs rearranged.
Tables are not compared: 2 previous and 3 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (14)
Current report
Gross profit decreased $0.4 million, or 8.8% from $5.1 million to $4.7 million. Gross margin decreased by 6.2% from 40.7% to 34.5%. The decrease in gross margin was driven primarily by an increase in overall manufacturing costs, product mix weighing toward capital system sales and geographic mix weighting toward international sales, partially offset by increases in average selling prices.
Current report
Other Expense, Net
Current report
Other expense, net was $33 thousand for the three months ended June 28, 2025 compared to other expense, net, of $22 thousand for the three months ended June 29, 2024. Other expense, net, consisted primarily of interest income or expense and foreign currency gain or loss.
Current report
Revenues
Current report
Our total revenues increased by $1.1 million, or 4.4%, from $24.4 million to $25.5 million. All of our product groups increased, with the retina product group seeing the largest increase.
Current report
Gross Profit and Gross Margin
Current report
Gross profit increased $0.1 million, or 1.5%, from $9.6 million to $9.7 million. Gross margin decreased by 1.1% from 39.3% to 38.2%. The decrease in gross margin was driven primarily by an increase in overall manufacturing costs, product mix weighing toward capital system sales and geographic mix weighting toward international sales, partially offset by increases in average selling prices.
Current report
Research and Development
Current report
Sales and Marketing
Current report
Sales and marketing expenses decreased by $2.2 million, or 31.0%, from $7.2 million to $5.0 million. The decrease was related to our cost savings measures, resulting in lower headcount expenses, consulting expenses, travel expenses, tradeshows and public relations expenses, and clinical studies expenses.
Current report
General and Administrative
Current report
Other Expense, Net
Current report
Income Taxes
Current report
The Company recorded an income tax provision of $33 thousand and $57 thousand for the six months ended June 28, 2025 and June 29, 2024, respectively.
Removed paragraphs (2)
Previous report
Gross profit increased $0.6 million, or 13.4% from $4.5 million to $5.1 million. Gross margin increased by 4.6% from 37.9% to 42.5%. The increase in gross margin was the result of lower manufacturing expenses and a more favorable product mix.
Previous report
Other Income (Expense), Net
Reworded paragraphs (16)
Previous wording
Cost of revenues consists primarily of our direct manufacturing costs which include the cost of components and sub-systems, assembling, packaging, shipping and testing components at our facility, direct labor and associated overhead, warranty, royalty and amortization of intangible assets and depot service costs. For certain of our products, we are responsible for the cost of the fully assembled product that is manufactured by a third-party.
Current wording
Cost of revenues consists primarily of our direct manufacturing costs which include the cost of components and sub-systems, assembling, packaging, shipping and testing components at our facility, direct labor and associated overhead, warranty, royalty and amortization of intangible assets and depot service costs. For certain of the Company's products, the Company responsible for the cost of the fully assembled product that is manufactured by a third-party.
Previous wording
Current macroeconomic conditions exhibit challenges that can affect capital equipment purchasing demand and timing, including recessionary fears, inflation concerns, tariffs and retaliatory responses, trade wars, heightened interest rates as a result of government actions to combat inflation, and uncertainty in the global banking and financial services market, as well as other geopolitical developments, have impacted and may continue to impact business spending and the economy as a whole. As a result, we have seen customers extend purchase decision cycles. We have also experienced some demand softness due to pricing effects from the strength of the U.S. Dollar that have impacted and may continue to impact our operations.
Current wording
Current macroeconomic conditions exhibit challenges that can affect capital equipment purchasing demand and timing, including recessionary fears, inflation concerns, tariffs and retaliatory responses, trade wars, heightened interest rates as a result of government actions to combat inflation, and uncertainty in the global banking and financial services market, as well as other geopolitical developments, have impacted and may continue to impact business spending and the economy as a whole. As a result, the Company has seen customers extend purchase decision cycles. If the U.S. dollar strengthens again, the Company could experience some demand softness due to pricing effects from the strength of the U.S. dollar.
Previous wording
Our total revenues increased by $0.1 million, or 1.1%, from $11.8 million to $11.9 million. The increase was driven by an increase in our glaucoma product group and in services and other revenue, partially offset by a decrease in our retina products.
Current wording
Our total revenues increased by $0.9 million, or 7.4%, from $12.6 million to $13.6 million. The increase was driven by an increase in our retina product group and in services and other revenue, partially offset by a decrease in our glaucoma product group.
Previous wording
Research and development expenses decreased by $0.7 million, or 43.0% from $1.6 million to $0.9 million. The decrease was related to our cost savings measures we implemented, resulting in lower headcount expenses. Spending on investment in new and expanded products was also curtailed.
Current wording
Research and development expenses decreased by $0.6 million, or 42% from $1.5 million to $0.9 million. The decrease was related to our cost savings measures we implemented, resulting in lower headcount expenses. Spending on investment in new and expanded products was also curtailed.
Previous wording
Sales and marketing expenses decreased $1.3 million, or 34.5%, from $3.7 million to $2.5 million. The decrease was related to our cost savings measures, including reductions in workforce that resulted in lower headcount expenses, lower consulting expenses, travel expenses, lower tradeshows and public relations expenses, and lower clinical studies expenses.
Current wording
Sales and marketing expenses decreased $1.0 million, or 27.3%, from $3.5 million to $2.5 million. The decrease was related to our cost savings measures, resulting in lower headcount expenses, consulting expenses, travel expenses, tradeshows and public relations expenses, and clinical studies expenses.
Previous wording
General and administrative expenses decreased by $0.5 million, or 21.8% from $2.5 million to $1.9 million. The decrease is a primarily due to a decrease in consulting costs and deal related legal expenses.
Current wording
General and administrative expenses decreased by $0.6 million, or 20.4% from $2.8 million to $2.2 million. The decrease was a primarily due to a decrease in consulting costs and deal related legal expenses.
Previous wording
We recorded an income tax provision of $12 thousand and $38 thousand for the three months ended March 29, 2025 and March 30, 2024, respectively.
Current wording
The Company recorded an income tax provision of $21 thousand and $19 thousand for the three months ended June 28, 2025 and June 29, 2024, respectively.
Previous wording
Other expense, net, was $1.5 million for the three months ended March 29, 2025, driven primarily by the costs associated with the Lind Note payable settlement. Other expense, net, was $0.1 million for the three months ended March 30, 2024, consisting primarily of interest and amortization of loan expenses related to the Lind Note transaction.
Current wording
Other expense, net, was $1.5 million for the six months ended June 28, 2025, driven primarily by the costs associated with the settlement of the Lind Note. Other expense, net, was $0.2 million for the six months ended June 29, 2024, consisting primarily of interest and amortization of loan expenses related to the Lind Note transaction.
Previous wording
As of March 29, 2025, we had cash and cash equivalents of $7.2 million and working capital of $14.3 million compared to cash and cash equivalents of $2.4 million and working capital of $7.0 million as of March 30, 2024.
Current wording
As of June 28, 2025, the Company had cash and cash equivalents of $6.8 million and working capital of $13.2 million compared to cash and cash equivalents of $2.4 million and working capital of $7.0 million as of December 28, 2024.
Previous wording
Net cash used in operating activities was $1.1 million in the three months ended March 29, 2025 compared to net cash used in operating activities of $1.6 million in the three months ended March 30, 2024. The increase in net cash provided by operating activities was primarily due to reduction in net loss and reduction in inventory, offset by decreases in collections of accounts receivable and a paydown of liabilities.
Current wording
Net cash used in operating activities was $1.5 million in the six months ended June 28, 2025 compared to net cash used in operating activities of $3.0 million in the six months ended June 29, 2024. The decrease in net cash used in operating activities was primarily due to reduction in net loss and reduction in inventory, offset by decreases in collections of accounts receivable and a paydown of liabilities.
Previous wording
For the three months ended March 29, 2025, net cash used in investing activities was $11 thousand, which consisted of capital expenditures. For the three months ended March 30, 2024, net cash used in investing activities was $3 thousand, which consisted of capital expenditures.
Current wording
For the six months ended June 28, 2025 and June 29, 2024, net cash used in investing activities was $24 thousand and $3 thousand, respectively, which consisted of capital expenditures.
Previous wording
For the three months ended March 29, 2025, net cash from financing activities was $6.0 million. We received $10 million in issuance of convertible preferred shares and convertible debt, offset by $4.0 million in early prepayment of convertible debt. For the three months ended March 30, 2024, no net cash was used in financing activities.
Current wording
For the six months ended June 28, 2025, net cash provided by financing activities was $6.0 million. The Company received $10 million in issuance of convertible preferred shares and convertible debt, offset by $4.0 million in early prepayment of convertible debt and taxes paid related to net share settlements of equity awards. For the six months ended June 29, 2024, no net cash was used in financing activities.
Previous wording
We have historically funded our operations primarily through sales of our products to customers, sales of our common stock and borrowing arrangements. As of March 29, 2025, our principal sources of liquidity consisted of cash and cash equivalents of $7.2 million. We have incurred net losses over the last several years, and as of March 29, 2025, have an accumulated deficit of approximately $89.6 million.
Current wording
The Company has historically funded our operations primarily through sales of our products to customers, sales of our common stock and borrowing arrangements. As of June 28, 2025, our principal sources of liquidity consisted of cash and cash equivalents of $6.8 million. The Company has incurred net losses over the last several years, and as of June 28, 2025, have an accumulated deficit of approximately $90.7 million.
Previous wording
On March 19, 2025, the Company entered into the Novel Securities Agreement and a Note Purchase Agreement and the Novel Note Purchase Agreement with Novel. Pursuant to the Novel Securities Agreement and the Novel Note Purchase Agreement, Novel has the right to purchase additional convertible promissory notes (the “Growth Notes”) in an aggregate principal amount of $10,000,000. The Growth Notes are issuable in three installments, with one third of the aggregate principal amount issuable upon each yearly anniversary of the March 19, 2025. Notwithstanding any provision in the Transaction Documents (as defined in the Initial Novel Note) to the contrary, in no circumstance shall the Company be required to deliver to Novel any shares of Series B Preferred Stock or common stock pursuant to the terms of the Transaction Documents to the extent that (i) the aggregate of all such shares issued by the Company would exceed 19.99% of either (a) the total number of shares of common stock outstanding as of March 19, 2025 or (b) the total voting power of the Company’s securities outstanding as of March 19, 2025 that are entitled to vote on a matter being voted on by holders of the common stock, or (ii) such delivery would cause the holder to become, directly or indirectly, a “beneficial owner” (as defined in Rule 13d-3 under the Securities Exchange Act of 1934, as amended) of more than 19.99% of either (a) the total number of shares of common stock outstanding as of such date or (b) the total voting power of the Company’s securities outstanding as of such date that are entitled to vote on a matter being voted on by holders of the common stock, in each case, unless shareholder approval has been obtained
Current wording
On March 19, 2025, the Company entered into the Novel Securities Agreement and the Novel Note Purchase Agreement with Novel. Pursuant to the Novel Securities Agreement and the Novel Note Purchase Agreement, Novel has the right to purchase additional convertible promissory notes (the “Growth Notes”) in an aggregate principal amount of $10,000,000. The Growth Notes are issuable in three installments, with one third of the aggregate principal amount issuable upon each yearly anniversary after March 19, 2025.
Previous wording
We believe our existing cash and cash equivalents will be sufficient to meet our anticipated cash needs over the next 12 months. Our future capital requirements will depend on many factors, including our growth rate, the timing and extent of our spending to support research and development activities, the timing and cost of establishing additional sales and marketing capabilities, the introduction of new and enhanced products and our costs to implement new manufacturing technologies. Any debt financing obtained by us in the future could also involve restrictive covenants relating to our capital-raising activities and other financial and operational matters, which may make it more difficult for us to obtain additional capital and to pursue business opportunities, including potential acquisitions. Additionally, if we raise additional funds through further issuances of equity, our existing stockholders could suffer significant dilution in their percentage ownership of our company, and any new equity securities we issue could have rights, preferences and privileges senior to those of holders of our common stock.
Current wording
The Company believes its existing cash and cash equivalents will be sufficient to meet its anticipated cash needs over the next 12 months. The Company's future capital requirements will depend on many factors, including its growth rate, the timing and extent of its spending to support research and development activities, the timing and cost of establishing additional sales and marketing capabilities, the introduction of new and enhanced products and its costs to implement new manufacturing technologies. Any debt financing obtained by the Company in the future could also involve restrictive covenants relating to its capital-raising activities and other financial and operational matters, which may make it more difficult for the Company to obtain additional capital and to pursue business opportunities, including potential acquisitions. Additionally, if the Company raises additional funds through further issuances of equity, its existing stockholders could suffer significant dilution in their percentage ownership of the Company, and any new equity securities the Company issue could have rights, preferences and privileges senior to those of holders of our common stock.
Previous wording
We do not have any off-balance sheet arrangements that have or are reasonably likely to have a material current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.
Current wording
The Company does not have any off-balance sheet arrangements that have or are reasonably likely to have a material current or future effect on its financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.
Rearranged current paragraphs (5)
Current report — wording carried from elsewhere
The following comparisons are between the six months ended June 28, 2025 and June 29, 2024 (in thousands):
Current report — wording carried from elsewhere
While we believe that the market for our products remains strong, the overall capital expenditure landscape within hospitals, surgical centers and physician offices may continue to be negatively impacted by persistent macroeconomic concerns discussed above.
Current report — wording carried from elsewhere
Gross margins may fluctuate due to changes in the relative proportion of domestic and international sales, the product mix of sales, introduction of new products, manufacturing variances, total unit volume changes, responses to the evolving macroeconomic and geopolitical uncertainty, including tariffs and trade wars, and other factors.
Current report — wording carried from elsewhere
Research and development expenses decreased by $1.3 million, or 42.5%, from $3.0 million to $1.7 million. The decrease was related to our cost savings measures we implemented, resulting in lower headcount expenses. Spending on investment in new and expanded products was also curtailed.
Current report — wording carried from elsewhere
General and administrative expenses decreased by $1.2 million, or 21.1%, from $5.3 million to $4.1 million. The decrease was a primarily due to a decrease in consulting costs and deal related legal expenses.