CARLSMED, INC.
For the period ended Sep 30, 2025. Filed Nov 6, 2025.
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.
Sep 30, 2025 · Filed Nov 6, 2025
CARL$14.52-5.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-08-28.
0000950170-25-111953
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-11-06.
0001193125-25-269545
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 131 previous paragraphs and 141 current paragraphs.
75 unchanged; 42 reworded; 22 added; 13 removed; 1 previous and 2 current paragraphs rearranged.
Tables are not compared: 5 previous and 5 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 (22)
Current report
Regulatory Overview
Current report
aprevo Lumbar
Current report
aprevo Cervical
Current report
Market Adoption and Clinical Evidence
Current report
Our COMPASS Registry is generating ongoing real-world evidence of patient outcomes from lumbar spine surgery with the aprevo Technology Platform. For instance, data presented for 115 aprevo-treated ASD patients at the Scoliosis Research Society (SRS) Annual Meeting in September 2025 demonstrated a 75% reduction in spine fusion revision surgery at two years compared to a patient-matched cohort treated with stock interbody devices.
Current report
In November 2024, we received FDA 510(k) clearance for our aprevo interbodies for cervical spine fusion surgery as part of the FDA-cleared aprevo Technology Platform. We expect to receive FDA clearance for our accompanying personalized plating solutions and plan to commercialize the aprevo Technology Platform for cervical spine fusion surgeries by early 2026. We intend to drive initial adoption of this new indication among our existing base of surgeons who are actively using the aprevo Technology Platform for lumbar spine fusion surgeries.
Current report
We also believe that our technology platform has the potential to be utilized across various spinal indications and disease states such as cervical corpectomy and cervical disc arthroplasty. Additional FDA clearances would be required for these or any other new indications.
Current report
Hospital and Outpatient Reimbursement
Current report
aprevo® Lumbar
Current report
aprevo® Cervical
Current report
Effective October 1, 2025, cervical fusion procedures utilizing aprevo personalized interbody implants for traditional Medicare beneficiaries are eligible for New Technology Add-on Payments (NTAPs) from CMS. The NTAP program provides additional reimbursement to hospitals that use designated new medical technologies in the first few years of market introduction. These new technologies must demonstrate significant clinical improvement in the diagnosis or treatment of Medicare beneficiaries compared to existing alternatives or be designated by the FDA as breakthrough technology. CMS created unique ICD-10-PCS codes to identify cervical fusion procedures using "custom made anatomically designed interbody fusion devices" such as our aprevo Technology Platform. Reimbursement claims submitted with these unique ICD-10-PCS procedure codes may qualify hospitals for up to an additional $21,125 in NTAP reimbursement for eligible inpatient procedures.
Current report
For hospital outpatient departments (HOPDs) and ambulatory surgery centers (ASC), where many cervical procedures are performed, an applicable Transitional Pass-Through ("TPT") payment was included in the CMS Outpatient Prospective Payment System (OPPS) Proposed Rule. TPT payments help ensure timely access for Medicare beneficiaries to new and innovative medical technologies prior to CMS having sufficient cost data to permanently assign those items to an Ambulatory Payment Classification (APC). We anticipate that the applicable TPT payment will go into effect in early 2026 and that it will cover the differential of the facilities' cost of purchasing aprevo interbody implants in cervical fusions.
Current report
** Change not meaningful
Current report
Gross margin was 75.9% for the three months ended September 30, 2025, as compared to 72.8% for the three months ended September 30, 2024 with the improvement primarily due to a reduction in the per unit production fees charged by our contract manufacturer and decreased inventory reserve expenses.
Current report
Gross margin was 74.8% for the nine months ended September 30, 2025, as compared to 73.3% for the nine months ended September 30, 2024 with the improvement primarily driven by a reduction in per unit production fees charged by our contract manufacturer and decreased inventory reserve expenses.
Current report
Interest expense remained consistent at $0.4 million for both the three months ended September 30, 2025 and 2024 due to consistent borrowings outstanding under the Customers Loan Agreement during both periods.
Current report
**Change not meaningful
Current report
**Change not meaningful
Current report
As of September 30, 2025, $15.6 million of principal was outstanding under the Customers Loan Agreement that matures on October 31, 2029. As of September 30, 2025, an aggregate $11.9 million was available to draw. The Customers Loan Agreement was amended in October 2025, as discussed below and in Note 4 in the accompanying notes to our unaudited Condensed Financial Statements, to increase borrowing capacity and achieve other related objectives.
Current report
On October 29, 2025, we amended the Customers Loan Agreement (the "Fifth Amendment") to expand this credit facility which currently consists of (i) a term loan in the principal amount of up to $50.0 million (the “Term Loan”), $17.5 million of which is contingent upon the achievement of requisite revenue milestones, and (ii) a $10.0 million non-formula revolving line of credit (the “Non-Formula Revolving Line”). The maximum availability for draw under the Term Loan and Non-Formula Revolving Line now aggregates to $42.5 million.
Current report
The maturity date of the Term Loan was extended to October 15, 2030, with an interest-only period through October 15, 2027, followed by principal repayment over 36 months thereafter. Upon achievement of certain revenue milestones, the interest-only period and repayment terms of the Term Loan may be extended through April 15, 2028 followed by principal repayment over 30 months, and upon achievement of an additional milestone, may be further extended through October 15, 2028, followed by principal repayment over 24 months thereafter. The Non-Formula Revolving Line will mature on October 15, 2028. The applicable per annum interest rate did not change as a result of the Fifth Amendment and remains as thegreater of(a) WSJ Prime Rate + 0.25% or (b) 5.25%.
Current report
As discussed further above, on October, 29, 2025, we amended this arrangement and this maturity date was extended to October 15, 2030, with an interest-only period through October 15, 2027, followed by principal repayment over 36 months thereafter. Upon achievement of certain revenue milestones, the interest-only period and repayment terms may be further extended to an interest-only period through October 15, 2028, followed by principal repayment over 24 months thereafter. The applicable per annum interest rate did not change as a result of the Fifth Amendment and remains as thegreater of (a) WSJ Prime Rate + 0.25% or (b) 5.25%.
Removed paragraphs (13)
Previous report
Regulatory and Reimbursement
Previous report
As of October 2024, CMS adopted new Medicare Severity-Diagnosis Related Groups (“MS-DRGs”) that cover most lumbar spine fusion procedures involving a “custom-made anatomically designed” (“CMAD”) interbody fusion device, such as our aprevo interbody implants. These new MS-DRGs provide premium reimbursement rates for our hospital customers, relative to lumbar fusion procedures using stock implants. We believe this classification will support our customers' continued access to our technology.
Previous report
Market Adoption
Previous report
Additionally, we are at an advanced stage of development of our aprevo Technology Platform for cervical spine fusion surgery. In November 2024, we received FDA 510(k) clearance for our aprevo Technology Platform for cervical spine fusion surgery. In 2025, we plan to continue to build out our aprevo Technology Platform for cervical fusion procedures by pursuing additional clearances for advancements to our cervical software platform and our personalized plating solutions. There is, however, no guarantee that our cervical software platform and our personalized plating solutions will obtain FDA clearance on the expected timeline, or at all.
Previous report
Assuming we obtain the necessary additional 510(k) clearances, we anticipate that we will fully commercialize the aprevo Technology Platform for cervical spine fusion surgeries in early 2026 and intend to drive adoption of the Platform for cervical fusion surgery among our existing base of surgeons who are actively using aprevo interbody implants for lumbar spine fusion surgeries. We also believe that our aprevo Technology Platform can be utilized across various indications and disease states within the spine that are beyond those that we are currently cleared for, such as cervical corpectomy and cervical disc arthroplasty.
Previous report
Reimbursement
Previous report
Interest expense was $0.4 million and $0.3 million for the three months ended June 30, 2025 and 2024, respectively. The increase of less than $0.1 million, or 11.7%, was primarily driven by an increased amount of borrowings outstanding under the Customers Loan Agreement.
Previous report
In December 2022, we entered the Customers Loan Agreement. The Customers Loan Agreement had an initial maturity date of December 2026 and provided up to $12.5 million in principal funding, and in October 2023, we drew $3.1 million under the Customers Loan Agreement.
Previous report
On March 7, 2024, we executed a Third Amendment to the Customers Loan Agreement (the “Third Amendment”), increasing the credit facility size from $12.5 million to $18.8 million and extending the maturity date to December 31, 2027, then subject to achievement of certain revenue and other milestones, and in May 2024, we drew $6.3 million under the Customers Loan Agreement.
Previous report
On December 30, 2024, we entered into a Fourth Amendment to the Customers Loan Agreement (the “Fourth Amendment”), expanding the facility to $27.5 million through the addition of two tranches, one of which is a revenue milestone-based tranche. The Fourth Amendment also extended the maturity date to October 31, 2029. The Fourth Amendment provides for an interest-only period through July 31, 2026, followed by principal repayment over 39 months thereafter. Upon achievement of certain revenue milestones, the interest-only period may be extended through July 31, 2027, followed by principal repayment over 27 months thereafter. As of June 30, 2025, the requisite revenue milestones for this extension were not yet met.
Previous report
The applicable interest rate on the Customers Loan Agreement, as of June 30, 2025, was 7.75%, reflecting the greater of (a) the WSJ Prime Rate + 0.25% or (b) 5.25%, and the Customers Loan Agreement contains an interest-only period, with repayment terms that may adjust based on meeting additional milestones as discussed above.
Previous report
In connection with each of the Third Amendment and the Fourth Amendment, we issued the Series B Warrant to Customers Bank to purchase up to 58,420 shares of our Series B convertible preferred stock at an exercise price of $6.93 and issued the Series C Warrant to Customers Bank to purchase up to 20,375 shares of our Series C convertible preferred stock with an exercise price of $10.74 per share. See Note 4—Debt in the notes to our unaudited condensed financial for additional information regarding our Series B Warrant and Series C Warrant.
Previous report
As of June 30, 2025, we were in compliance with all covenants contained in the Customers Loan Agreement. See Note 4—Debt in the notes to our unaudited condensed financial statements for additional information regarding the Customers Loan Agreement.
Reworded paragraphs (42)
Previous wording
We are a commercial-stage medical technology company pioneering artificial intelligence (“AI”)-enabled personalized spine surgery solutions with a mission to improve outcomes and decrease the cost of healthcare for spine surgery and beyond. We are focused on becoming the standard of care for spine fusion surgery. The aprevo Technology Platform consists of AI-enabled software solutions, and interbody implants that we custom design for each patient’s unique pathology and vertebral bone topography, and single-use surgical instruments. The aprevo Technology Platform was designed to address the limitations of traditional spine fusion surgery and aims to optimize patient outcomes and reduce the need for revision surgeries. By providing personalized surgical plans and interbody implants for custom vertebral fit that are powered by AI-enabled, outcomes-based algorithms, the aprevo Technology Platform supports surgeons in achieving proper spinal alignment for patients with degenerative disc disease (“DDD”), which can improve clinical outcomes and reduce the likelihood of revision surgeries. We currently market the aprevo Technology Platform for lumbar spine fusion surgery, and we are further developing the aprevo Technology Platform for use in cervical spine fusion surgeries, which we expect to commercialize in 2026.
Current wording
We are a commercial-stage medical technology company pioneering artificial intelligence (“AI”)-enabled personalized spine surgery solutions with a mission to improve outcomes and decrease the cost of healthcare for spine surgery and beyond. We are focused on becoming the standard of care for spine fusion surgery. The aprevo Technology Platform consists of AI-enabled software solutions, and interbody implants that we custom design for each patient’s unique pathology and vertebral bone topography, and single-use surgical instruments. The aprevo Technology Platform was designed to address the limitations of traditional spine fusion surgery and aims to optimize patient outcomes and reduce the need for revision surgeries.
Previous wording
Since we began commercializing the aprevo Technology Platform in 2021, we have experienced sequential quarterly and annual revenue growth from the rapid commercial adoption of the aprevo Technology Platform. For the three months ended June 30, 2025 and 2024, we recognized revenue of $12.1 million and $6.1 million, respectively, representing period-over-period growth of 98.7%. For the six months ended June 30, 2025 and 2024, we recognized revenue of $22.3 million and $11.2 million, respectively, representing period-over-period growth of 99.4%.
Current wording
Since we began commercializing the aprevo Technology Platform in 2021, we have experienced sequential quarterly and annual revenue growth from its rapid commercial adoption. For the three months ended September 30, 2025 and 2024, we recognized revenue of $13.1 million and $6.6 million, respectively, representing period-over-period growth of 98.4%. For the nine months ended September 30, 2025 and 2024, we recognized revenue of $35.3 million and $17.8 million, respectively, representing period-over-period growth of 99.1%.
Previous wording
Our business model depends on our ability to timely deliver aprevo interbody implants in order to allow surgeons to maintain their surgical schedule. In November 2024, we launched our digital production system (“DPS”), which we developed to enable us to deliver our aprevo interbody implants to hospitals within 10 business days of surgical plan approval. Our aprevo interbody implants are manufactured to our specifications by contract manufacturing organizations (“CMOs”) who meet our manufacturer qualification standards. Our streamlined DPS manages both the upstream and downstream processes involved in producing our aprevo interbody implants.
Current wording
Our business model depends on our ability to timely deliver aprevo interbody implants in order to allow surgeons to maintain surgical schedules for their patients. In November 2024, we launched our digital production system (“DPS”), which we developed to enable us to deliver our aprevo interbody implants to hospitals within 10 business days of surgical plan approval. Starting in October 2025, this lead time has been further reduced to eight business days. Our implants are manufactured to our specifications by contract manufacturing organizations (“CMOs”) who meet our manufacturer qualification standards. Our streamlined DPS manages both the upstream and downstream processes involved in producing our implants.
Previous wording
On July 24, 2025, we completed our initial public offering of 6,700,000 shares of our common stock, at a price to the public of $15.00 per share (the “IPO”). We received net proceeds of $93.5 million from the IPO, after deducting underwriting discounts and commissions and before additional offering expenses payable by us.
Current wording
On July 24, 2025, we completed our initial public offering of 6,700,000 shares of our common stock, at a price to the public of $15.00 per share (the “IPO”). We received net proceeds of $93.5 million from the IPO, after deducting underwriting discounts and commissions and before additional offering expenses of $5.4 million paid by us.
Previous wording
In July 2020, the U.S. Food and Drug Administration (“FDA”) awarded us a Breakthrough Device Designation, indicating that aprevo interbody implants are likely to provide a more effective treatment than the current standard of care in lumbar fusion with the use of stock implants. In December 2020, the FDA cleared our aprevo interbody implants through its 510(k) regulatory clearance pathway for lumbar fusions performed for correction of adult spinal deformity (“ASD”). After FDA clearance, we commenced the limited clinical release of the aprevo Technology Platform, with the first U.S. patient implant in February 2021. In October 2021, the Centers for Medicare and Medicaid Services (“CMS”) awarded our aprevo interbody implants the New Technology Add-On Payments (“NTAP”). This provided supplemental reimbursement to hospitals for each qualifying aprevo lumbar procedure through October 2024. In that same month, we commenced our U.S. commercial launch of the aprevo Technology Platform for lumbar spine fusion surgery. In August 2022, the FDA cleared the aprevo Technology Platform through its 510(k) regulatory clearance pathway for the treatment of patients with DDD of the lumbar spine.
Current wording
In July 2020, the U.S. Food and Drug Administration (“FDA”) awarded us a Breakthrough Device Designation, indicating that aprevo lumbar interbody implants are likely to provide a more effective treatment than the use of stock implants. In December 2020, the FDA cleared our aprevo interbody implants through its 510(k) regulatory clearance pathway for lumbar fusions to correct adult spinal deformity (“ASD”). After FDA clearance, we commenced the limited clinical release of the aprevo Technology Platform, with the first U.S. aprevo patient procedure completed in February 2021. In August 2022, the FDA cleared the aprevo Technology Platform through its 510(k) regulatory clearance pathway for the treatment of patients with several degenerative conditions of the lumbar spine.
Previous wording
In September 2023, the FDA granted us our second Breakthrough Device Designation for aprevo in cervical spine fusion. In November 2024, we received FDA 510(k) clearance for our aprevo Technology Platform for cervical spine fusion surgery. In July 2025, CMS provided a NTAP for the aprevo interbody implant for this cervical indication that results in supplemental reimbursement to hospitals for each qualifying aprevo cervical procedure, effective October 1, 2025. In July 2025, the first aprevo cervical procedure was successfully completed at UC San Diego Health. Assuming we get the necessary remaining regulatory clearances, we expect to commercialize the aprevo Technology Platform for cervical fusion surgery in 2026.
Current wording
In September 2023, the FDA granted us our second Breakthrough Device Designation for aprevo in cervical spine fusion. In November 2024, we received FDA 510(k) clearance for our aprevo Technology Platform for cervical spine fusion surgery. In July 2025, the first aprevo cervical procedure was successfully completed at UC San Diego Health. Through October 31, 2025, over 50 aprevo cervical procedures have been successfully completed by over a dozen spine surgeons as part of our clinical evaluation program. We expect to commercialize the aprevo Technology Platform for cervical fusion surgery by early 2026.
Previous wording
Since the full commercial launch of the aprevo Technology Platform for lumbar spine fusion surgery in October 2021, the aprevo Technology Platform has been used to treat more than 1,500 patients. We estimate there are approximately 4,000 surgeons across the United States whose patients could benefit from using the aprevo Technology Platform (Moore et al., 2021). As of June 30, 2025, 199 surgeon users have completed one or more procedures using the aprevo Technology Platform, compared to 116 surgeon users as of June 30, 2024. Over time, we expect to not only grow the base of surgeons using the aprevo Technology Platform but to also increase the number of procedures using the aprevo Technology Platform that are performed by existing surgeons. To achieve this, we plan to grow our commercial infrastructure and expand various market access initiatives, including utilizing medical education programs and surgeon training at top academic institutions.
Current wording
Since its full commercial launch in October 2021, the aprevo Technology Platform for lumbar spine fusion surgery has been used to treat more than 2,600 patients through September 31, 2025. We estimate there are approximately 4,000 surgeons across the United States whose patients could benefit from using our platform.
Previous wording
We are also committed to building upon our strong foundation of clinical evidence demonstrating the efficacy of our aprevo Technology Platform. Clinical data publications are important tools for surgeon education and patient awareness of the benefits of the aprevo Technology Platform versus stock implants. For example, our COMPASS Registry is generating real-world evidence of patient outcomes from lumbar spine surgery with the aprevo Technology Platform. We anticipate that this registry will support a robust cadence of publications.
Current wording
We are also committed to building upon our strong foundation of clinical evidence demonstrating the efficacy of our aprevo Technology Platform. Clinical data publications are important tools for surgeon education and patient awareness of the benefits of our personalized solution as compared to stock implants.
Previous wording
Our research and development initiatives are focused on introducing enhancements and new capabilities aimed at increasing the value provided by our aprevo Technology Platform to patients, surgeons, and payors. We have introduced multiple iterations of our algorithm and software platform to drive further improvements of our predictive analytics and diagnostics. We believe that these improvements will strengthen our ability to leverage the post-operative data we collect to build a clinical decision model to further help physicians make better decisions earlier on in the treatment process.
Current wording
Our research and development initiatives are focused on introducing new products, enhancements and capabilities aimed at increasing the value provided by our aprevo Technology Platform to patients, surgeons, and payors. We are developing new iterations of our algorithm and software platform to drive further improvements in surgical planning. We believe that these improvements will strengthen our ability to leverage post-operative data to build predictive analytic models and further enable surgeons to make more informed decisions to best treat their patients.
Previous wording
CMS has assigned new technology X-codes for use of our aprevo Technology Platform in cervical spine procedures. In July 2025, CMS announced X-codes for the use of CMAD interbody fusion devices for cervical spine fusion surgeries which will be critical to the commercial success of our cervical implants. Future changes in the level of reimbursement, however, could have a significant impact on our results of operations, either positively or negatively. The level at which reimbursement is set by payors for procedures using our aprevo Technology Platform, and any increase in reimbursement for procedures using our aprevo Technology Platform, depends substantially on our continued ability to generate clinical evidence, gain advocacy in the respective physician societies, and work with CMS and commercial payors.
Current wording
Future changes in the level of reimbursement that hospitals and outpatient facilities receive from payors for lumbar and cervical fusion surgical procedures could have a significant impact on our results of operations. The level of payors' reimbursement for procedures using our aprevo Technology Platform depends substantially on our continued ability to generate clinical evidence, support from key opinion leaders, and gain advocacy for patient access to our technology with CMS and commercial payors.
Previous wording
Procedures using our aprevo Technology Platform are covered by Medicare, Medicare Advantage, and commercial payors. For the three and six months ended June 30, 2025, we estimate that our hospital customers’ payor mix consisted of approximately 40% and 41% for commercial insurance, respectively, and 60% and 59% for Medicare and Medicare Advantage insurance, respectively. The MS-DRG codes to which procedures using the aprevo Technology Platform are assigned, provide premium reimbursement to hospitals for lumbar fusion procedures relative to those that use stock implants. This level of hospital reimbursement has a substantial impact on how widely our aprevo Technology Platform is accepted.
Current wording
Procedures using our aprevo Technology Platform are covered by Medicare, Medicare Advantage, and commercial payors. For the three and nine months ended September 30, 2025, we estimate that our hospital customers’ payor mix consisted of approximately 44% and 42% for commercial insurance, respectively, and 56% and 58% for Medicare and Medicare Advantage insurance, respectively. Effective October 2024, CMS adopted a new MS-DRG coding system which reassigns MS-DRG codes for certain lumbar spine fusion procedures when “custom-made anatomically designed interbody fusion devices” (such as our aprevo Technology Platform) are utilized. This provides premium reimbursement for our hospital customers, relative to the use of stock implants. We believe this, among other factors, will support our customers' continued demand for our technology.
Previous wording
Gross profit (i.e., revenue less cost of sales) and gross margin (i.e., gross profit as apercentage of revenue) have been, and will continue to be, affected by various factors. These include potential changes to our average revenue per procedure, sales volumes, third-party manufacturing costs, direct labor costs, and software costs. We expect our gross margin to remain relatively constant over the short term and to modestly increase over the medium and long term with economies of production scale, increased leverage of our AI technologies, and other manufacturing efficiencies.
Current wording
Gross profit (i.e., revenue less cost of sales) and gross margin (i.e., gross profit as apercentage of revenue) have been, and will continue to be, affected by various factors. These include potential changes to our average revenue per procedure, sales volumes, third-party manufacturing costs, direct labor costs, and software costs. We expect our gross margin to remain relatively constant over the short term and to modestly increase over the medium and long term with economies of production scale, increased leverage of our AI technologies, and other planned manufacturing efficiencies.
Previous wording
We have issued warrants for the purchase of our convertible preferred stock in conjunction with the loan and security agreement with Customers Bank (the "Customers Loan Agreement"). We account for these liability-classified warrants, initially measured at fair value, in accordance with ASC Topic 480. Changes in fair value of warrant liabilities are recognized in the Statements of Operations and Comprehensive Loss.
Current wording
Prior to the closing of the IPO on July 24, 2025, we had issued warrants for the purchase of our convertible preferred stock in conjunction with the loan and security agreement with Customers Bank (the "Customers Loan Agreement"). We accounted for these liability-classified warrants, initially measured at fair value, in accordance with ASC Topic 480. Changes in fair value of warrant liabilities have been recognized in the Statements of Operations and Comprehensive Loss. See Note 2—Summary of Significant Accounting Policiesin the notes to our unaudited Condensed Financial Statements for information regarding the Series B Warrant and the Series C Warrant in connection with the Customers Loan Agreement.
Previous wording
Comparison of the Three and Six Months Ended June 30, 2025 and 2024
Current wording
Comparison of the Three and Nine Months Ended September 30, 2025 and 2024
Previous wording
Revenue was $12.1 million and $6.1 million for the three months ended June 30, 2025 and 2024, respectively. The increase of $6.0 million, or 98.7%, was primarily driven by increased volume of surgical procedures with the aprevo Technology Platform in the current quarter, with our average revenue per procedure substantially flat between these periods.
Current wording
Revenue was $13.1 million and $6.6 million for the three months ended September 30, 2025 and 2024, respectively. The increase of $6.5 million, or 98.4%, was primarily driven by increased volume of surgical procedures with the aprevo Technology Platform in the current quarter, with our average revenue per procedure substantially constant between these periods.
Previous wording
Revenue was $22.3 million and $11.2 million for the six months ended June 30, 2025 and 2024, respectively. The increase of $11.1 million, or 99.4%, was primarily driven by increased volume of surgical procedures with the aprevo Technology Platform in the current six month period, with our average revenue per procedure substantially flat between these periods.
Current wording
Revenue was $35.3 million and $17.8 million for the nine months ended September 30, 2025 and 2024, respectively. The increase of $17.6 million, or 99.1%, was primarily driven by increased volume of surgical procedures with the aprevo Technology Platform in the current nine month period, with our average revenue per procedure substantially constant between these periods.
Previous wording
Cost of sales was $3.2 million and $1.5 million for three months ended June 30, 2025 and 2024, respectively. The increase of $1.7 million, or 111.6%, was primarily driven by increased sales of aprevo interbody implants in the current quarter and the associated increase in contract manufacturing materials and costs for the three months ended June 30, 2025 with this sales volume, as compared to the three months ended June 30, 2024. Gross margin was 73.4% for the three months ended June 30, 2025, as compared to 75.0% for the three months ended June 30, 2024. This modest decrease was primarily driven by expedite production fees charged by our contract manufacturer in the current quarter to meet customer timing requirements and other material costs.
Current wording
Cost of sales was $3.1 million and $1.8 million for the three months ended September 30, 2025 and 2024, respectively. The increase of $1.4 million, or 75.6%, was primarily driven by increased sales of aprevo interbody implants in the current quarter and the associated increase in contract manufacturing materials and costs for the three months ended September 30, 2025 with this sales volume, as compared to the three months ended September 30, 2024.
Previous wording
Cost of sales was $5.8 million and $2.9 million for the six months ended June 30, 2025 and 2024, respectively. The increase of $2.8 million, or 96.1%, was primarily driven by increased sales of aprevo interbody implants in the current six month period and the associated increase in contract manufacturing materials and costs for the six months ended June 30, 2025 with this sales volume, as compared to the six months ended June 30, 2024. Gross margin was 74.1% for the six months ended June 30, 2025, as compared to 73.7% for the six months ended June 30, 2024 with the slight improvement due to material costs.
Current wording
Cost of sales was $8.9 million and $4.7 million for the nine months ended September 30, 2025 and 2024, respectively. The increase of $4.2 million, or 88.3%, was primarily driven by increased sales of aprevo interbody implants in the current nine month period and the associated increase in contract manufacturing materials and costs for the nine months ended September 30, 2025 with this sales volume, as compared to the nine months ended September 30, 2024.
Previous wording
Research and development expenses were $4.2 million and $4.0 million for the three months ended June 30, 2025 and 2024, respectively. The increase of $0.2 million, or 4.1%, was primarily due to higher personnel costs to support product development and artificial intelligence initiatives, partially offset by decreased prototype and materials costs and reduced COMPASS registry costs following enrollment completion in the second half of 2024.
Current wording
Research and development expenses were $4.4 million and $4.0 million for the three months ended September 30, 2025 and 2024, respectively. The increase of $0.4 million, or 10.2%, was primarily due to higher personnel costs to support product development and AI initiatives; this was partially offset by decreased prototype and materials costs and reduced COMPASS registry costs following enrollment completion in the second half of 2024.
Previous wording
Research and development expenses remained consistent at $7.3 million for both the six months ended June 30, 2025 and 2024. Personnel-related costs increased by $1.1 million primarily due to headcount additions to support our product development initiatives and artificial intelligence initiatives, and were substantially offset by decreased costs for external services and prototype parts and materials and reduced COMPASS registry costs following enrollment completion in second half of 2024.
Current wording
Research and development expenses were $11.8 million and $11.3 million for the nine months ended September 30, 2025 and 2024, respectively. The increase of $0.5 million, or 4.1% was primarily due to higher personnel costs to support product development and AI initiatives; this was partially offset by decreased costs for external services and prototype parts and materials and reduced COMPASS registry costs following enrollment completion in second half of 2024.
Previous wording
Sales and marketing expenses were $7.9 million and $4.9 million for the three months ended June 30, 2025 and 2024, respectively. The increase of $3.0 million, or 61.5%, was primarily driven by a $1.5 million increase in personnel-related costs primarily due to increased headcount and sales compensation for employees, a $1.3 million increase in commissions to independent sales agents, a $0.5 million increase in various marketing costs, and a $0.1 million increase in employee travel costs. These increases were partially offset by a decrease in professional service fees of $0.6 million.
Current wording
Sales and marketing expenses were $9.6 million and $6.6 million for the three months ended September 30, 2025 and 2024, respectively. The increase of $3.0 million, or 45.1%, was primarily driven by a $1.6 million increase in personnel-related costs (including increased headcount, sales compensation for employees, employee bonuses, and stock-based compensation), a $1.3 million increase in commissions to independent sales agents, a $0.7 million increase in various marketing costs, and a $0.3 million increase in other costs. These increases were partially offset by a decrease in professional service fees of $0.9 million.
Previous wording
Sales and marketing expenses were $14.6 million and $8.5 million for the six months ended June 30, 2025 and 2024, respectively. The increase of $6.1 million, or 72.5%, was primarily driven by a $2.8 million increase in personnel-related costs primarily due to increased headcount and sales compensation for employees, a $2.4 million increase in commissions to independent sales agents, a $1.1 million increase in various marketing costs, and a $0.3 million increase in employee travel costs. These increases were partially offset by a decrease in professional service fees of $0.6 million.
Current wording
Sales and marketing expenses were $24.2 million and $15.1 million for the nine months ended September 30, 2025 and 2024, respectively. The increase of $9.1 million, or 60.5%, was primarily driven by a $4.3 million increase in personnel-related costs (including increased headcount, sales compensation for employees, employee bonuses and stock-based compensation), a $3.7 million increase in commissions to independent sales agents, a $1.7 million increase in various marketing costs, a $0.3 million increase in employee travel costs, and a $0.6 million increase in other costs. These increases were partially offset by a decrease in professional service fees of $1.5 million.
Previous wording
General and administrative expenses were $3.3 million and $2.0 million for the three months ended June 30, 2025 and 2024, respectively. The increase of $1.3 million, or 66.3%, was primarily driven by a $0.5 million increase in professional service and legal fees for corporate and intellectual property matters, a $0.5 million increase in costs for personnel additions to support business growth and public company readiness, and a $0.2 million increase in the provision for credit losses from accounts receivable.
Current wording
General and administrative expenses were $4.9 million and $1.9 million for the three months ended September 30, 2025 and 2024, respectively. The increase of $3.0 million, or 155.8%, was primarily driven by a $1.6 million increase in professional service and legal fees for corporate and intellectual property matters, a $1.1 million increase in costs for personnel additions to support business growth and compliance and operational requirements as a public company, and a $0.3 million increase in other administrative costs.
Previous wording
General and administrative expenses were $6.8 million and $4.2 million for the six months ended June 30, 2025 and 2024, respectively. The increase of $2.7 million, or 64.0%, was primarily driven by a $1.4 million increase in professional service and legal fees for corporate and intellectual property matters, a $0.7 million increase in costs for personnel additions to support business growth and public company readiness, and a $0.6 million increase in other administrative expenses.
Current wording
General and administrative expenses were $11.7 million and $6.1 million for the nine months ended September 30, 2025 and 2024, respectively. The increase of $5.6 million, or 93.1%, was primarily driven by a $3.0 million increase in professional service and legal fees for corporate and intellectual property matters, a $1.8 million increase in costs for personnel additions to support business growth, compliance and operational requirements as a public company, and a $0.8 million increase in other administrative costs.
Previous wording
Interest expense was $0.7 million and $0.5 million for the six months ended June 30, 2025 and 2024, respectively. The increase of $0.2 million, or 33.1%, was primarily driven by an increased amount of borrowings outstanding under the Customers Loan Agreement.
Current wording
Interest expense was $1.1 million and $0.9 million for the nine months ended September 30, 2025 and 2024, respectively. The increase of $0.2 million, or 16.6%, was primarily driven by an increased amount of borrowings outstanding under the Customers Loan Agreement.
Previous wording
Interest income was $0.7 million and $0.5 million for the six months ended June 30, 2025 and 2024, respectively. The increase of $0.2 million, or 36.1%, was due to an increase in bank interest on our higher daily average cash and cash equivalent balances.
Current wording
Interest income was $1.0 million and $0.4 million for the three months ended September 30, 2025 and 2024, respectively. The increase of $0.6 million, or 142.1%, was due to an increase in bank interest on our higher daily average cash and cash equivalent balances resulting from the proceeds from our IPO in July 2025.
Previous wording
Interest income was $0.3 million and $0.4 million for the three months ended June 30, 2025 and 2024, respectively. The decrease of $0.1 million, or 21.5%, was due to a decrease in bank interest on our lower daily average cash and cash equivalent balances.
Current wording
Interest income was $1.7 million and $0.9 million for the nine months ended September 30, 2025 and 2024, respectively. The increase of $0.8 million, or 81.5%, was due to an increase in bank interest on our higher daily average cash and cash equivalent balances resulting from the proceeds from our IPO in July 2025.
Previous wording
The fair value of warrant liabilities increased by $0.2 million during both the three and six months ended June 30, 2025 compared to both the three and six months ended June 30, 2024.
Current wording
The fair value of warrant liabilities increased by less than $0.1 million and $0.2 million during the three and nine months ended September 30, 2025 compared to the three and nine months ended September 30, 2024, respectively.
Previous wording
We have incurred net losses and negative cash flows from operations since our inception. We have historically financed operations primarily through the net proceeds that we have received from the sale of shares of our convertible preferred stock, borrowings under our debt facilities, and cash generated from the sales of aprevo interbody implants. Since inception through June 30, 2025, we had raised aggregate gross equity proceeds of $105.1 million primarily from the issuance of convertible preferred stock. As of June 30, 2025, we had $33.5 million of cash and cash equivalents, $15.6 million of principal outstanding under the Customers Loan Agreement, and an accumulated deficit of $83.7 million. As of June 30, 2025, an aggregate principal amount of $7.5 million was available for future borrowings under the Customers Loan Agreement with an additional $4.4 million available upon future achievement of a requisite revenue milestone.
Current wording
We have incurred net losses and negative cash flows from operations since our inception. We have historically financed operations primarily through the net proceeds that we have received from the sale of shares of our convertible preferred stock, borrowings under our debt facilities, and cash generated from the sales of aprevo interbody implants. On July 24, 2025, we completed our IPO and received $93.5 million in net proceeds, after deducting underwriting discounts and commissions and before additional offering expenses of $5.4 million paid by us. As of September 30, 2025, we had $115.4 million of cash and cash equivalents, $15.6 million of principal outstanding under the Customers Loan Agreement, and an accumulated deficit of $92.2 million.
Previous wording
Our losses primarily resulted from the costs incurred in the development and sales and marketing of our products and providing general and administrative support for our operations. We may continue to incur losses and expend significant amounts of cash in the foreseeable future as we continue to scale our business, invest in research and development activities, increase sales and marketing expenses to support commercial expansion, and increase general and administrative expenses to support being a publicly traded company.
Current wording
Our losses primarily resulted from the costs incurred in the development and sales and marketing of our products and providing general and administrative support for our operations. We may continue to incur losses and expend significant amounts of cash in the foreseeable future as we continue to scale our business, invest in research and development activities, increase sales and marketing expenses to support commercial expansion, and increase general and administrative expenses associated with operating as a publicly traded company.
Previous wording
Based on our current operating plan, we believe the net proceeds from the IPO, together with our existing cash and cash equivalents, the expected cash generated from sales of our aprevo interbody implants, and amounts currently available for future borrowings under our Customers Loan Agreement will be sufficient to fund our planned operating expenses and capital expenditure requirements for at least the next 12 months. We have based this estimate on assumptions that may prove to be wrong, and we could deplete our capital resources sooner than we expect. Our quarterly and annual financial results may fluctuate as a result of a variety of factors, many of which are outside of our control and, as a result, may not fully reflect the underlying performance of our business. Fluctuation in quarterly and annual results may decrease the value of our common stock.
Current wording
Based on our current operating plan, we believe our existing cash and cash equivalents, the expected cash generated from sales of our aprevo interbody implants, and amounts currently available for future borrowings under our Customers Loan Agreement will be sufficient to fund our planned operating expenses and capital expenditure requirements for at least the next 12 months. We have based this estimate on assumptions that may prove to be wrong, and we could deplete our capital resources sooner than we expect. Our quarterly and annual financial results may fluctuate as a result of a variety of factors, many of which are outside of our control and, as a result, may not fully reflect the underlying performance of our business. Fluctuation in quarterly and annual results may decrease the value of our common stock.
Previous wording
expenses associated with indemnification obligations to third parties that are subject to litigation or claims, including in relation to intellectual property infringement, or incur other losses as a result of their use of our products;
Current wording
expenses associated with indemnification obligations to third parties that are subject to litigation or claims, including in relation to intellectual property infringement, or that incur other losses as a result of their use of our products;
Previous wording
advances and trends in new technologies and industry standard.
Current wording
advances and trends in new technologies and industry standards.
Previous wording
For the six months ended June 30, 2025, net cash used in operating activities was $15.2 million. Cash payments to vendors during the six months ended June 30, 2025 totaled $21.2 million and payroll-related cash payments totaled $13.0 million. We received $19.0 million from our customers for sales of aprevo interbody implants in the six months ended June 30, 2025, though we recognized $22.3 million of revenue based on the timing of aprevo interbody implants use in surgical procedures in this period.
Current wording
For the nine months ended September 30, 2025, net cash used in operating activities was $23.7 million. Cash payments to vendors during the nine months ended September 30, 2025 totaled $34.4 million and payroll-related cash payments totaled $19.8 million. We received $30.5 million from our customers for sales of aprevo interbody implants in the nine months ended September 30, 2025 and recognized $35.3 million of revenue, based on the timing of aprevo interbody implants use in surgical procedures in this period.
Previous wording
For the six months ended June 30, 2024, net cash used in operating activities was $13.7 million. Cash payments to vendors during the six months ended June 30, 2024 totaled $14.3 million, and payroll-related cash payments totaled $8.3 million. We received $8.9 million from our customers for sales of aprevo interbody implants in the six months ended June 30, 2024, though we recognized $11.2 million of revenue based on the timing of aprevo interbody implants use in surgical procedures in this period.
Current wording
For the nine months ended September 30, 2024, net cash used in operating activities was $21.3 million. Cash payments to vendors during the nine months ended September 30, 2024 totaled $24.2 million and payroll-related cash payments totaled $12.5 million. We received $15.4 million from our customers for sales of aprevo interbody implants in the nine months ended September 30, 2024 and recognized $17.8 million of revenue based on the timing of aprevo interbody implants use in surgical procedures in this period.
Previous wording
For the six months ended June 30, 2025, net cash used in investing activities was $0.9 million and consisted primarily of purchases of property and equipment of $0.4 million, capitalized internal use software costs of $0.4 million, and payment of initial direct costs of $0.1 million for the new operating lease entered into in May 2025.
Current wording
For the nine months ended September 30, 2025, net cash used in investing activities was $1.3 million and consisted primarily of purchases of property and equipment of $0.6 million, capitalized internal use software costs of $0.6 million, and payment of initial direct costs of $0.1 million for a new operating lease entered into in May 2025.
Previous wording
For the six months ended June 30, 2024, net cash used in investing activities was $0.1 million and consisted primarily of purchases of property and equipment.
Current wording
For the nine months ended September 30, 2024, net cash used in investing activities was $0.1 million and consisted of purchases of property and equipment.
Previous wording
For the six months ended June 30, 2025, net cash provided by financing activities was $9.5 million, consisted primarily of net proceeds from the issuance of Series C convertible preferred stock of $11.9 million and proceeds from the exercise of stock options of $0.2 million. This was partially offset by payments for deferred offering costs of $2.6 million in connection with the IPO.
Current wording
For the nine months ended September 30, 2025, net cash provided by financing activities was $100.2 million, consisting primarily of proceeds from its initial public offering of $93.5 million, net of underwriting discounts and commissions, net proceeds from the issuance of Series C convertible preferred stock of $11.9 million and proceeds from the exercise of stock options of $0.2 million. This was partially offset by payments for deferred offering costs of $5.4 million in connection with our IPO.
Previous wording
For the six months ended June 30, 2024, net cash provided by financing activities was $44.6 million, consisted primarily of net proceeds from the issuance of Series C convertible preferred stock of $38.4 million and borrowings under the Customers Loan Agreement of $6.2 million.
Current wording
For the nine months ended September 30, 2024, net cash provided by financing activities was $58.5 million, consisting primarily of net proceeds from the issuance of Series C convertible preferred stock of $52.3 million and borrowings under the Customers Loan Agreement of $6.2 million.
Previous wording
Total principal amount outstanding as of June 30, 2025, was $15.6 million. The Customers Loan Agreement matures on October 31, 2029, with an interest-only period through July 31, 2026, followed by principal repayment over 39 months thereafter. Upon achievement of certain revenue milestones, the interest-only period may be extended through July 31, 2027, and principal repayment over 27 months thereafter. As of June 30, 2025, the requisite revenue milestones for this extension were not yet met.
Current wording
Total principal amount outstanding under the Customers Loan Agreement as of September 30, 2025, was $15.6 million. As of September 30, 2025, this debt matured on October 31, 2029, with an interest-only period through January 31, 2027, followed by principal repayment over 33 months thereafter.
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Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
The aprevo Technology Platform is powered by AI-enabled, outcome-based algorithms and provides personalized surgical plans and interbody implants for custom vertebral fit. The aprevo Technology Platform supports surgeons in achieving proper spinal alignment for patients with degenerative disc disease (“DDD”), which can improve clinical outcomes and reduce the likelihood of revision surgeries. We currently market the aprevo Technology Platform for lumbar spine fusion surgery and are expanding the platform for use in cervical spine fusion surgeries, which we expect to launch commercially in early 2026.
Current report — wording carried from elsewhere
Over time, we expect to meaningfully grow the base of surgeons using the aprevo Technology Platform and its penetration with existing surgeon users. To achieve this, we plan to grow our commercial infrastructure and expand various market access initiatives, including utilizing medical education programs and surgeon training at top academic institutions.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
On July 24, 2025, we completed our IPO and received $93.5 million in net proceeds, after deducting underwriting discounts and commissions and before additional offering expenses payable by us.