ReWalk Robotics Ltd
For the period ended Jun 30, 2024. Filed Aug 14, 2024.
View on SEC.govAbout this filing
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 30, 2024 · Filed Aug 14, 2024
LFWD$5.81+1.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-05-15.
0001178913-24-001738
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-08-14.
0001178913-24-002623
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 70 previous paragraphs and 77 current paragraphs.
38 unchanged; 28 reworded; 8 added; 4 removed; 0 previous and 3 current paragraphs rearranged.
Tables are not compared: 18 previous and 15 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 (8)
Current report
Second Quarter 2024 Business Highlights
Current report
Research and development expenses were $2.5 million for the six months ended June 30, 2024, an increase of $0.9 million or 59%, compared to the six months ended June 30, 2023. The increase is primarily attributable to the acquisition of AlterG which added investments in new product development projects.
Current report
Sales and marketing expenses were $9.4 million for the six months ended June 30, 2024, an increase of $4.4 million, or 89%, for the six months ended June 30, 2024, compared to the six months ended June 30, 2023. Sales and marketing expenses for the six months ended June 30, 2024 included $0.8 million of amortization of intangible assets from the acquisition of AlterG. Additional drivers of the increase include higher personnel-related expenses stemming from the increase in headcount from the AlterG acquisition and higher promotional spending.
Current report
General and administrative expenses were $1.6 million for the three months ended June 30, 2024, down $0.8 million, or 34%, compared to the three months ended June 30, 2023. General and administrative expenses for the three months ended June 30, 2024 included $0.1 million of amortization of intangible assets from the acquisition of AlterG and $0.5 million of income from an adjustment for the remeasurement of the earnout liability from the acquisition of AlterG. The three months ended June 30, 2024 benefited from lower professional services fees, partially offset by higher personnel-related expenses stemming from the increase in headcount from the AlterG acquisition.
Current report
General and administrative expenses were $3.2 million for the six months ended June 30, 2024, down $0.9 million, or 23%, compared to the results for the six months ended June 30, 2023. General and administrative expenses for the six months ended June 30, 2024 included $0.1 million of amortization of intangible assets from the acquisition of AlterG. Additionally, the results include $0.5 million in other income from the remeasurement of the earnout liability related to the AlterG acquisition, and a further $0.5 million in other income from the post-closing statement associated with the acquisition. The six months ended June 30, 2024 reflects a decrease in professional services fees, although it was partially offset by an increase in personnel-related expenses due to the expansion in headcount following the acquisition of AlterG.
Current report
Financial income, net, declined by $0.4 million, or 74%, for the three months ended June 30, 2024, compared to the three months ended June 30, 2023. This decrease was primarily due to yield on a lower cash balance resulting from the acquisition of AlterG.
Current report
Financial income, net, declined by $0.3 million, or 41%, for the six months ended June 30, 2024, compared to the six months ended June 30, 2023. This decrease was primarily due to yield on a lower cash balance resulting from the acquisition of AlterG.
Current report
Net cash used in operating activities increased by $4.6 million, or 52%, for the six months ended June 30, 2024 primarily due to increase in trade receivables from the timing of Medicare payments for initial claims to be paid and increased inventory purchases for the establishment of safety stock of ReWalk systems as a result of the continuing conflict in Israel and in preparation for the future new product introduction of the ReWalk 7.
Removed paragraphs (4)
Previous report
First Quarter 2024 Business Highlights
Previous report
General and administrative expenses declined by $0.1 million, or 6.9%, for the three months ended March 31, 2024 compared to the three months ended March 31, 2023. This decrease resulted from $0.5 million of other income related to the post closing statement for the acquisition of AlterG, partially offset by higher payroll costs stemming from the increase in headcount, consulting fees for IT projects, and $0.1 million for the amortization of intangible assets from the acquisition of AlterG.
Previous report
Financial income, net, increased by $0.2 million for the three months ended March 31, 2024 compared to the three months ended March 31, 2023. This increase was primarily due to a change in cash management practices to move cash balances to accounts that pay a higher interest rate and yield greater interest income, as well as exchange rate fluctuations.
Previous report
Net cash used in operating activities increased by $2.4 million, or 46.7%, for the three months ended March 31, 2024 primarily due to the unfavourable gross margin compared to that of the prior year’s quarter and the timing of working capital utilization.
Reworded paragraphs (28)
Previous wording
We are a medical device company that designs, develops, and commercializes life-changing solutions that span the continuum of care in physical rehabilitation and recovery, delivering proven functional and health benefits in clinical settings as well as in the home and community. Our initial product offerings were the ReWalk Personal and ReWalk Rehabilitation Exoskeleton devices for individuals with spinal cord injury (“SCI Products”). These devices are robotic exoskeletons that are designed for individuals with paraplegia that use our patented tilt-sensor technology and an onboard computer and motion sensors to drive motorized legs that power movement. These SCI Products allow individuals with spinal cord injury (“SCI”) the ability to stand and walk again during everyday activities at home or in the community. In March 2023, we received 510(k) clearance from the U.S. Food and Drug Administration (“FDA”) for the ReWalk Personal Exoskeleton with stair and curb functionality which adds usage on stairs and curbs to the indication for use for the device in the U.S. The clearance permits U.S. customers to participate in more walking activities in real-world environments in their daily lives where stairs or curbs may have previously limited them when using the exoskeleton for its intended, FDA indicated uses. This feature has been available in Europe since initial CE Clearance, and real-world data from a cohort of 47 European users throughout a period of over seven years and consisting of over 18,000 stair steps was collected to demonstrate the safety and efficacy of this feature and support the FDA submission.
Current wording
We are a medical device company that designs, develops, and commercializes life-changing solutions that span the continuum of care in physical rehabilitation and recovery, delivering proven functional and health benefits in clinical settings as well as in the home and community. Our initial product offerings were the ReWalk Personal and ReWalk Rehabilitation Exoskeleton devices for individuals with spinal cord injury (“SCI Products”). These devices are robotic exoskeletons that are designed for individuals with paraplegia that use our patented tilt-sensor technology and an onboard computer and motion sensors to drive motorized legs that power movement. These SCI Products allow individuals with spinal cord injury (“SCI”) the ability to stand and walk again during everyday activities at home or in the community. In March 2023, we received 510(k) clearance from the U.S. Food and Drug Administration (“FDA”) for the ReWalk Personal Exoskeleton with stair and curb functionality which adds usage on stairs and curbs to the indication for use for the device in the U.S. The clearance permits U.S. customers to participate in more walking activities in real-world environments in their daily lives where stairs or curbs may have previously limited them when using the exoskeleton for its intended, FDA indicated uses. This feature has been available in Europe since initial CE Clearance, and real-world data from a cohort of 47 European users throughout a period of over seven years and consisting of over 18,000 stair steps was collected to demonstrate the safety and efficacy of this feature and support the FDA submission. In June 2024, we submitted a 510(k) premarket notification for ReWalk 7 Personal Exoskeleton device, a next-generation ReWalk model, and such 510(k) is pending FDA review.
Previous wording
We have sought to expand our product offerings beyond the SCI Products through internal development and distribution agreements. We have developed our ReStore Exo-Suit device, which we began commercializing in June 2019. The ReStore is a powered, lightweight soft exo-suit intended for use during the rehabilitation of individuals with lower limb disabilities due to stroke. During the second quarter of 2020, we finalized and moved to implement two separate agreements to distribute additional product lines in the United States. We are the exclusive distributor of the MYOLYN MyoCycle FES Pro cycles to U.S. rehabilitation clinics and for the MyoCycle Home cycles available to US veterans through the Veterans Health Administration (“VHA”) hospitals.
Current wording
We have sought to expand our product offerings beyond the SCI Products through internal development and distribution agreements. We have developed our ReStore Exo-Suit device (the “ReStore”), which we began commercializing in June 2019. The ReStore is a powered, lightweight soft exo-suit intended for use during the rehabilitation of individuals with lower limb disabilities due to stroke. During the second quarter of 2020, we finalized and moved to implement two separate agreements to distribute additional product lines in the United States. We are the exclusive distributor of the MYOLYN MyoCycle FES Pro cycles to U.S. rehabilitation clinics and for the MyoCycle Home cycles available to US veterans through the Veterans Health Administration (“VHA”) hospitals.
Previous wording
Our principal markets are primarily in the United States and Europe with some lesser sales to Asia, the Middle East and South America. We sell our products primarily directly in the United States, through a combination (depending on the product line) of direct sales and distributors in Germany, Canada, and Australia, and primarily through distributors in other markets. In our direct markets, we have established relationships with clinics and rehabilitation centers, professional and college sports teams, and individuals and organizations in the spinal cord injury community, and in markets where we do not sell direct to customers, our distributors maintain these relationships. We have offices in Marlborough, Massachusetts, Berlin, Germany, Yokneam, Israel and Fremont, California from where we operate our business.
Current wording
Our principal markets are primarily in the United States and Europe with some lesser sales to Asia, the Middle East and South America. We sell our products primarily directly in the United States, through a combination (depending on the product line) of direct sales and distributors in Germany, Canada, and Australia, and primarily through distributors in other markets. In our direct markets, we have established relationships with clinics and rehabilitation centers, professional and college sports teams, and individuals and organizations in the spinal cord injury community, and in markets where we do not sell direct to customers, our distributors maintain these relationships. We have offices in Marlborough, Massachusetts, Yokneam, Israel, Berlin, Germany, and Fremont, California from where we operate our business.
Previous wording
Results of Operations for the Three Ended March 31, 2024 and March 31, 2023
Current wording
Results of Operations for the Three and Six Months Ended June 30, 2024 and June 30, 2023
Previous wording
Our operating results for the three months ended March 31, 2024, as compared to the same period in 2023, are presented below. The results set forth below are not necessarily indicative of the results to be expected in future periods (in thousands):
Current wording
Our operating results for the three and six months ended June 30, 2024, as compared to the same period in 2023, are presented below. The results set forth below are not necessarily indicative of the results to be expected in future periods.
Previous wording
Three Months Ended March 31, 2024 Compared to Three Months Ended March 31, 2023
Current wording
Three and Six Months Ended June 30, 2024 Compared to Three and Six Months Ended June 30, 2023
Previous wording
Our revenue for the three months ended March 31, 2024 and 2023 was as follows (in thousands):
Current wording
Our revenue for the three and six months ended June 30, 2024 and 2023 was as follows (in thousands):
Previous wording
Revenues consist of SCI Products, AlterG anti-gravity systems, ReStore and the Distributed Product.
Current wording
Revenues are derived from the sale of SCI Products, AlterG anti-gravity systems, ReStore systems, and units of the Distributed Product. We also generate revenue from the sale of extended warranties and the provision of repair services for the products that we sell.
Previous wording
Revenues increased by $4.1 million for the three months ended March 31, 2024, compared to the three months ended March 31, 2023, due to the revenue contribution of AlterG following the acquisition which was $2.8 million, combined with a higher sales volume of ReWalk Personal primarily from the expansion of access through Medicare coverage.
Current wording
Revenues increased by $5.4 million for the three months ended June 30, 2024, compared to the three months ended June 30, 2023, due to the revenue contribution of AlterG following the acquisition which was $3.6 million, combined with a higher sales volume of ReWalk Personal exoskeletons primarily from the expansion of access through Medicare coverage.
Previous wording
In the future, we expect our growth to be driven by sales of our ReWalk Personal device through expansion of coverage and reimbursement by commercial and government third-party payors, as well as sales of AlterG anti-gravity systems and the Distributed Product.
Current wording
In the future, we expect our growth to be driven by sales of our ReWalk Personal device through expansion of coverage and reimbursement by commercial and government third-party payors, as well as sales of AlterG anti-gravity systems and units of the Distributed Product.
Previous wording
Our gross profit for the three months ended March 31, 2024 and 2023 was as follows (in thousands):
Current wording
Our gross profit for the three and six months ended June 30, 2024 and 2023 was as follows (in thousands):
Previous wording
Gross profit was 26.4% of revenue for the three months ended March 31, 2024 compared to 46.4% for the three months ended March 31, 2023. Gross profit for the three months ended March 31, 2024 included $0.4 million for amortization of intangible assets. Excluding the impact of the amortization of intangible assets, gross profit as a percentage of revenue was 33.7% for the three months ended March 31, 2024, down 12.8 percentage points from the three months ended March 31, 2023. This decline was a result of a low volume of AlterG product sales, which resulted in adverse absorption of production and overhead costs, combined with an adverse mix of ReWalk systems sold.
Current wording
Gross profit was 41.1% of revenue for the three months ended June 30, 2024, compared to 43.1% for the three months ended June 30, 2023. Gross profit for the three months ended June 30, 2024 included $0.4 million for amortization of intangible assets. Excluding the impact of the amortization of intangible assets, gross profit as a percentage of revenue was 46.9% for the three months ended June 30, 2024, up 3.7 percentage points from the three months ended June 30, 2023. This increase was a result of a higher volume of ReWalk product sales, which resulted in favorable absorption of production and overhead costs.
Previous wording
We expect gross profit and gross margin will increase in the future as we increase our revenue volumes and realize operating efficiencies associated with greater scale which will reduce the cost of revenue as a percentage of revenue. Improvements may be partially offset by increased material costs and costs of service.
Current wording
We expect gross profit and gross profit as a percentage of revenue will increase in the future as we increase our revenue volumes and realize operating efficiencies associated with greater scale which will reduce the cost of revenue as a percentage of revenue. Improvements may be partially offset by increased material costs and costs of service.
Previous wording
Our research and development expenses, net, for the three months ended March 31, 2024 and 2023 were as follows (in thousands):
Current wording
Our research and development expenses, net, for the three and six months ended June 30, 2024 and 2023 were as follows (in thousands):
Previous wording
Research and development expenses increased by $0.5 million, or 71.7%, for the three months ended March 31, 2024 compared to the three months ended March 31, 2023. The increase is primarily attributable to higher investments associated with new product development projects.
Current wording
Research and development expenses were $1.2 million for the three months ended June 30, 2024, an increase of $0.4 million, or 48%, compared to the three months ended June 30, 2023. The increase is primarily attributable to the acquisition of AlterG which added investments in new product development projects.
Previous wording
We intend to focus our research and development resources primarily on our current product support, as well as to advance the FDA submission for clearance of the ReWalk 7 next-generation exoskeleton model. We also have ongoing product development activity for our AlterG Anti-Gravity systems, including a program to develop a new entry level model of AlterG system designed to address the priorities of smaller independent clinics which is a segment of the market that we believe has potential for greater penetration.
Current wording
We intend to focus our research and development resources primarily on supporting our current products, advancing the ongoing product development activities for our AlterG Anti-Gravity systems, and preparing for the next stages following our recent FDA 510(k) submission for clearance of the ReWalk 7 next-generation exoskeleton model.
Previous wording
Our sales and marketing expenses for the three months ended March 31, 2024 and 2023 were as follows (in thousands):
Current wording
Our sales and marketing expenses for the three and six months ended June 30, 2024 and 2023 were as follows (in thousands):
Previous wording
Sales and marketing expenses increased by $2.5 million, or 101.9%, for the three months ended March 31, 2024 compared to the three months ended March 31, 2023. Sales and marketing expenses for the three months ended March 31, 2024 included $0.4 million of amortization of intangible assets from the acquisition of AlterG. The increase was primarily driven by higher payroll costs stemming from the increase in headcount. Additionally, commission expenses escalated due to the growth in revenues and expanded commercial team. Moreover, there was an uptick in marketing expenses owing to rebranding efforts and sales events.
Current wording
Sales and marketing expenses were $4.4 million for the three months ended June 30, 2024, an increase of $1.9 million, or 76%, for the three months ended June 30, 2024, compared to the three months ended June 30, 2023. Sales and marketing expenses for the three months ended June 30, 2024 included $0.4 million of amortization of intangible assets from the acquisition of AlterG. Additional drivers of the increase include higher personnel-related expenses stemming from the increase in headcount from the AlterG acquisition and higher promotional spending.
Previous wording
In the near term our sales and marketing expense are expected to be driven by our efforts to expand the reimbursement coverage of our ReWalk Personal Exoskeleton device, to integrate and unify the combined sales and marketing resources of the ReWalk and AlterG organizations, and to support our current commercial product activities.
Current wording
Our sales and marketing efforts are expected to focus on driving growth in our commercial product portfolio, expanding the reimbursement coverage by commercial payors of our ReWalk Personal Exoskeleton device, and integrating and unifying the combined sales and marketing resources of the ReWalk and AlterG organizations.
Previous wording
Our general and administrative expenses for the three months ended March 31, 2024 and 2023 were as follows (in thousands):
Current wording
Our general and administrative expenses for the three and six months ended June 30, 2024 and 2023 were as follows (in thousands):
Previous wording
Our financial income, net, for the three months ended March 31, 2024 and 2023 were as follows (in thousands):
Current wording
Our financial income, net, for the three and six months ended June 30, 2024 and 2023 were as follows (in thousands):
Previous wording
Our income tax for the three months ended March 31, 2024 and 2023 was as follows (in thousands):
Current wording
Our income tax for the three and six months ended June 30, 2024 and 2023 was as follows (in thousands):
Previous wording
Income taxes decreased by $18 thousand, or 75%, for the three months ended March 31, 2024 compared to the three months ended March 31, 2023, mainly due to the utilization of net operation losses forward arising from the acquisition of AlterG.
Current wording
Income taxes decreased by $37 thousand, or 88%, for the three months ended June 30, 2024, compared to the three months ended June 30, 2023, mainly due to the utilization of net operation losses forward arising from the acquisition of AlterG.
Previous wording
During the three months ended March 31, 2024, we incurred a consolidated net loss of $6.3 million and have an accumulated deficit in the total amount of $242.2 million. Our cash and cash equivalents as of March 31, 2024, totaled $20.7 million and our negative operating cash flow for the three months ended March 31, 2024, was $7.7 million. We have sufficient funds to support our operations for more than 12 months following the issuance date of our condensed consolidated unaudited financial statements for the three months ended March 31, 2024.
Current wording
During the six months ended June 30, 2024, we incurred a consolidated net loss of $10.6 million and have an accumulated deficit in the total amount of $246.5 million. Our cash and cash equivalents as of June 30, 2024, totaled $15.1 million and our negative operating cash flow for the six months ended June 30, 2024, was $13.3 million. We have sufficient funds to support our operations for more than 12 months following the issuance date of our condensed consolidated unaudited financial statements for the six months ended June 30, 2024.
Previous wording
We expect to incur future net losses and our transition to profitability is dependent upon, among other things, the successful development and commercialization of our products and product candidates, the establishment of contracts for the distribution of new product lines, or the acquisition of additional product lines, any of which, or in combination, would contribute to the achievement of a level of revenues adequate to support our cost structure. Until we achieve profitability or generate positive cash flows, we will continue to need to raise additional cash from time to time.
Current wording
We expect to incur future net losses and our transition to profitability is dependent upon, among other things, the successful development and commercialization of our products and product candidates, the establishment of contracts for the distribution of new product lines, or the acquisition of additional product lines, any of which, or in combination, would contribute to the achievement of a level of revenues adequate to support our cost structure. If the Company will not achieve a level of revenues adequate to support its cost structure, the Company will apply reductions in its costs. Until we achieve profitability or generate positive cash flows, we will continue to need to raise additional cash from time to time.
Previous wording
Cash Flows for the Three Months Ended March 31, 2024 and March 31, 2023 (in thousands):
Current wording
Cash Flows for the Six Months Ended June 30, 2024 and 2023 (in thousands):
Previous wording
Net cash used in financing activities decreased by $0.8 million, or 100%, for the three months ended March 31, 2024. The decrease is due to the repurchase of our ordinary shares under our repurchase program, which expired on August 9, 2023.
Current wording
Net cash used in financing activities decreased by $1 million, or 100%, for the six months ended June 30, 2024. The decrease is due to the repurchase of our ordinary shares under our repurchase program, which expired on August 9, 2023.
Previous wording
We calculated the payments due under our operating lease obligation for our Israeli office that are to be paid in NIS at a rate of exchange of NIS 3.68: $1.00, and the payments due under our operating lease obligation for our German subsidiary that are to be paid in euros at a rate of exchange of €1.00: $1.08, both of which were the applicable exchange rates as of March 31, 2024.
Current wording
We calculated the payments due under our operating lease obligation for our Israeli office that are to be paid in NIS at a rate of exchange of NIS 3.76: $1.00, and the payments due under our operating lease obligation for our German subsidiary that are to be paid in euros at a rate of exchange of €1.00: $1.07, both of which were the applicable exchange rates as of June 30, 2024.
Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
Revenues increased by $9.4 million for the six months ended June 30, 2024, compared to the six months ended June 30, 2023, due to the revenue contribution of AlterG following the acquisition, which was $6.4 million, combined with a higher sales volume of ReWalk Personal exoskeletons primarily from the expansion of access through Medicare coverage.
Current report — wording carried from elsewhere
Gross profit was 34.6% of revenue for the six months ended June 30, 2024, compared to 44.7% for the six months ended June 30, 2023. Gross profit for the six months ended June 30, 2024 included $0.8 million for amortization of intangible assets. Excluding the impact of the amortization of intangible assets, gross profit as a percentage of revenue was 41.0% for the six months ended June 30, 2024, down 3.7 percentage points from the six months ended June 30, 2023. This decline was a result of a low volume of AlterG product sales in the first quarter, which resulted in adverse absorption of production and overhead costs, partially offset by volume leverage from a higher volume of ReWalk product sales.
Current report — wording carried from elsewhere
Income taxes decreased by $55 thousand, or 83%, for the six months ended June 30, 2024, compared to the six months ended June 30, 2023, mainly due to the utilization of net operation losses forward arising from the acquisition of AlterG.