Apyx Medical Corp

Previous wording

We are an advanced energy technology company with a passion for elevating people’s lives through innovative products, including our Helium Plasma Platform Technology products marketed and sold as Renuvion® in the cosmetic surgery market and J-Plasma® in the hospital surgical market. Renuvion and J-Plasma offer surgeons a unique ability to provide controlled heat to tissue to achieve their desired results. We also leverage our deep expertise and decades of experience in unique waveforms through OEM agreements with other medical device manufacturers.

Current wording

We are a surgical aesthetics company with a passion for elevating people’s lives through innovative products, including our Helium Plasma Platform Technology products marketed and sold as Renuvion® and the AYON Body Contouring System TMin the cosmetic surgery market and J-Plasma® in the hospital surgical market. Renuvion and J-Plasma offer surgeons a unique ability to provide controlled heat to tissue to achieve their desired results. The AYON Body Contouring System TM is an FDA-cleared, surgeon-designed body contouring system that combines precision, versatility, and innovation in an all-in-one platform. It seamlessly integrates fat removal, closed loop contouring, and Renuvion’s tissue contraction and electrosurgical capabilities, empowering surgeons to deliver comprehensive body contouring treatments for patients. We also leverage our deep expertise and decades of experience in unique waveforms through OEM agreements with other medical device manufacturers.

Previous wording

We operate in two business segments: OEM and Advanced Energy. The OEM segment is primarily development and manufacturing contract and product driven. The Advanced Energy segment sells both capital equipment and consumables in the form of a single-use handpiece. Sales of handpiece units are a substantial portion of our business and for the six months ended June 30, 2025 and 2024, we sold approximately 40,000 and 45,000 units, respectively, as a result of an overall lower number of liposuction procedures and commercial focus on the launch of AYON in the U.S. Handpiece revenue accounts for more than 60% of our total Advanced Energy revenue.

Current wording

We operate in two business segments: OEM and Surgical Aesthetics, formerly known as Advanced Energy. The OEM segment is primarily development and manufacturing contracts and product driven. The Surgical Aesthetics segment sells both capital equipment and consumables in the form of a single-use handpiece. Sales of handpiece units are a substantial portion of our business and for the nine months ended September 30, 2025 and 2024, we sold approximately 63,000 and 64,000 units, respectively. This is a result of an overall lower number of liposuction procedures and commercial focus on the launch of AYON. In the U.S. Handpiece revenue accounts for more than 50% of our total Surgical Aesthetics revenue.

Previous wording

Glucagon- like peptide -1 receptor agonists ("GLP-1s"), such as Mounjaro®, Wegovy® and Ozempic®, are prescribed for the treatment of diabetes and/or weight loss in combination with exercise to improve glycemic control. GLP-1’s have also been found to mimic the GLP-1 satiety hormone in our bodies. When one eats, GLP-1 is released in the small intestines regulating blood sugar and sending signals to the brain centers that control appetite. Studies have shown patients taking GLP-1’s have experienced a loss of body weight. Currently, three GLP-1’s are cleared by the FDA for weight loss, but we anticipate a number of additional drug candidates will be cleared as well as, oral versions of these injectable medications.

Current wording

Glucagon- like peptide -1 receptor agonists ("GLP-1s"), such as Mounjaro®, Wegovy® and Ozempic®, are prescribed for the treatment of diabetes and/or weight loss in combination with exercise to improve glycemic control. GLP-1’s have also been found to mimic the GLP-1 satiety hormone in our bodies. When one eats, GLP-1 is released in the small intestines regulating blood sugar and sending signals to the brain centers that control appetite. Studies have shown patients taking GLP-1’s have experienced a loss of body weight. Currently, three GLP-1’s are cleared by the FDA for weight loss, but we anticipate a number of additional drug candidates will be cleared, as well as oral versions of these medications.

Previous wording

On May 13, 2025, we announced that we had received 510(k) clearance from the U.S. Food and Drug Administration (the “FDA”) for the AYON Body Contouring System™ (“AYON”). We are actively preparing for a commercial launch of AYON leveraging our relationships with key surgeons in critical geographies. The official commercial launch of AYON will commence in the second half of 2025.

Current wording

On May 13, 2025, we announced that we had received 510(k) clearance from the U.S. Food and Drug Administration (the “FDA”) for the AYON Body Contouring System™ (“AYON”). We completed our soft launch of AYON, leveraging our relationships with key surgeons in critical geographies. Additionally, we commenced the commercial launch of AYON in September 2025.

Previous wording

This initial 510(k) clearance for AYON covers a wide variety of aesthetic treatments, including Renuvion to address loose and lax skin, ultrasound-assisted liposuction, electrocoagulation to support procedures requiring removal of excess tissue, along with several others. We intend to expand the cleared indications for AYON, to include power liposuction, with an additional 510(k) submission planned for later this year.

Current wording

The initial 510(k) clearance for AYON covers a wide variety of aesthetic treatments, including Renuvion to address loose and lax skin, ultrasound-assisted liposuction, electrosurgery to support procedures requiring removal of excess tissue and closed loop contouring, among others. October 13, 2025, we announced that we had submitted the 510(k) premarket notification to the FDA for the label expansion of AYON to include power liposuction.

Previous wording

The consequences of global supply chain instability and inflationary cost increases, potential and actual tariffs, and their adverse impact to the global economy, continue to evolve. Accordingly, the significance of the future impact to our business and financial statements remains subject to significant uncertainty. We continue to work on initiatives to combat inflation, including finding alternative suppliers that meet our quality standards, streamlining our supplier network to reduce the use of middlemen and redesigning some components to achieve better volume purchase prices. Inflation has not, to date, materially impacted our operations or financial performance. However, as these trends continue for raw materials, freight, and labor costs, our future financial performance could be adversely impacted.

Current wording

The consequences of global supply chain instability and inflationary cost increases, potential and actual tariffs, and their adverse impact to the global economy, continue to evolve. Accordingly, the significance of the future impact to our business and financial statements remains subject to significant uncertainty. We continue to work on initiatives to mitigate the effects of inflation on our business, including finding alternative suppliers that meet our quality standards, streamlining our supplier network to reduce the use of middlemen and redesigning some components to achieve better volume purchase prices. Inflation has not, to date, materially impacted our operations or financial performance. However, as these trends continue for raw materials, freight, and labor costs, our future financial performance could be adversely impacted.

Previous wording

In regard to our operating segments, results are aggregated into reportable segments only if they exhibit similar economic characteristics. In addition to similar economic characteristics, we also consider the following factors in determining the reportable segments: the nature of business activities, the management structure directly accountable to our chief operating decision maker for operating and administrative activities, availability of discrete financial information, and information presented to the Board of Directors and investors. Asset information is not reviewed by the chief operating decision maker by segment and is not available by segment and, accordingly, we have not presented a measure of assets by reportable segment.

Current wording

In regard to our operating segments, results are aggregated into reportable segments only if they exhibit similar economic characteristics. In addition to similar economic characteristics, we also consider the following factors in determining the reportable segments: the nature of business activities, the management structure directly accountable to our chief operating decision maker for operating and administrative activities, availability of discrete financial information, and information presented to the Board of Directors and investors. Asset information is not reviewed by the CODM by segment and is not available by segment and, accordingly, we have not presented a measure of assets by reportable segment.

Previous wording

Our reportable segments are disclosed as principally organized and managed as two operating segments: Advanced Energy and OEM. “Corporate & Other” includes certain unallocated corporate and administrative costs which are not specifically attributed to any reportable segment. The OEM segment is primarily development and manufacturing contract and product driven. All related expenses are recorded as cost of sales and therefore no segment specific operating expenses are incurred.

Current wording

Our reportable segments are disclosed as principally organized and managed as two operating segments: Surgical Aesthetics and OEM. “Corporate & Other” includes certain unallocated corporate and administrative costs which are not specifically attributed to any reportable segment. The OEM segment is primarily development and manufacturing contract and product driven. All related expenses are recorded as cost of sales and therefore no segment specific operating expenses are incurred.

Previous wording

Total revenue decreased by 6.4%, or approximately $0.8 million, for the three months ended June 30, 2025 when compared with the three months ended June 30, 2024. Advanced Energy segment sales decreased 1.0%, or approximately $0.1 million, for the three months ended June 30, 2025 when compared with the three months ended June 30, 2024. In the second quarter of 2025, in the U.S., we took preorders for the AYON system, which includes an Apyx One Console. For customers that did not already have an Apyx One Console, we shipped the Apyx One Console during the quarter and expect to ship the balance of the AYON system in the third and fourth quarters. OEM segment sales decreased 28.5%, or approximately $0.7 million, for the three months ended June 30, 2025 when compared with the three months ended June 30, 2024. The decrease in OEM sales was due to decreases in sales volume to existing customers, including Symmetry Surgical under our 10-year generator manufacturing and supply agreement.

Current wording

Total revenue increased by 12.1%, or approximately $1.4 million, for the three months ended September 30, 2025 when compared with the three months ended September 30, 2024. Surgical Aesthetics segment sales increased 19.1%, or approximately $1.8 million, for the three months ended September 30, 2025 when compared with the three months ended September 30, 2024. The Surgical Aesthetics sales increase was driven by sales of AYON, as we commenced our commercial launch during the quarter and an increased volume of single-use handpieces in both domestic and international markets. These increases were partially offset by decreases in domestic sales of generators, including upgrades to the Apyx One Console, where the purchase of AYON was not part of the sale and upgrades to the Apyx One Console in international markets. Overall, domestic Surgical Aesthetics segment sales increased by over 30% from the prior year period. OEM segment sales decreased 17.6%, or approximately $0.4 million, for the three months ended September 30, 2025 when compared with the three months ended September 30, 2024. The decrease in OEM sales was due to decreases in sales volume to existing customers, including Symmetry Surgical under our 10-year generator manufacturing and supply agreement.

Previous wording

Total revenue decreased by 7.1%, or approximately $1.6 million, for the six months ended June 30, 2025 when compared with the six months ended June 30, 2024. Advanced Energy segment sales increased 2.0%, or approximately $0.3 million, for the six months ended June 30, 2025 when compared with the six months ended June 30, 2024. In the second quarter of 2025, in the U.S., we took preorders for the AYON system, which includes an Apyx One Console. For customers that did not already have an Apyx One Console, we shipped the Apyx One Console during the quarter and expect to ship the balance of the AYON system in the third and fourth quarters. OEM segment sales decreased 37.3%, or approximately $1.9 million, for the six months ended June 30, 2025 when compared with the six months ended June 30, 2024. The decrease in OEM sales was due to decreases in sales volume to existing customers, including Symmetry Surgical under our 10-year generator manufacturing and supply agreement.

Current wording

Total revenue decreased by 0.6%, or approximately $0.2 million, for the nine months ended September 30, 2025 when compared with the nine months ended September 30, 2024. Surgical Aesthetics segment sales increased 8.0%, or approximately $2.1 million, for the nine months ended September 30, 2025 when compared with the nine months ended September 30, 2024. The Surgical Aesthetics sales increase was driven by sales of AYON, as we commenced our commercial launch during the third quarter. This increase was partially offset by decreases in domestic and internal sales of generators, including upgrades to the Apyx One Console, where the purchase of AYON was not part of the sale. OEM segment sales decreased 31.4%, or approximately $2.3 million, for the nine months ended September 30, 2025 when compared with the nine months ended September 30, 2024. The decrease in OEM sales was due to decreases in sales volume to existing customers, including Symmetry Surgical under our 10-year generator manufacturing and supply agreement.

Previous wording

International sales represented approximately 31.6% and 30.2% of total revenues for the three and six months ended June 30, 2025, respectively, as compared with 28.5% and 30.0% of total revenues for the same period in the prior year. Management estimates our products have been sold in more than 60 countries through local dealers coordinated by sales and marketing personnel through our facilities in Clearwater, Florida and Sofia, Bulgaria.

Current wording

International sales represented approximately 27.5% and 29.2% of total revenues for the three and nine months ended September 30, 2025, respectively, as compared with 32.2% and 30.8% of total revenues for the same period in the prior year. Management estimates our products have been sold in more than 60 countries through local dealers, coordinated by our sales and marketing personnel through our facilities in Clearwater, Florida and Sofia, Bulgaria.

Previous wording

Gross profit for the three months ended June 30, 2025, decreased 5.5% to $7.1 million, compared to $7.5 million for the same period in the prior year. Gross margin for the three months ended June 30, 2025, was 62.3%, compared to 61.7% for the same period in 2024. The increase in gross margin for the three months ended June 30, 2025 from the prior year period is primarily attributable to mix between our segments with Advanced Energy comprising a higher percentage of total sales and product mix within our Advanced Energy segment. These increases were partially offset by a decrease in the average selling price of generators to domestic customers, geographic mix within our Advanced Energy segment, with international sales comprising a higher percentage of total sales and product mix within our OEM segment.

Current wording

Gross profit for the three months ended September 30, 2025, increased 19.3% to $8.3 million, compared to $7.0 million for the same period in the prior year. Gross margin for the three months ended September 30, 2025, was 64.4%, compared to 60.5% for the same period in 2024. The increase in gross margin for the three months ended September 30, 2025 from the prior year period is primarily attributable to mix between our segments with Surgical Aesthetics comprising a higher percentage of total sales, geographic mix, with domestic sales comprising a higher percentage of total sales and product mix within our OEM segment. These increases were partially offset by changes in product mix within our Surgical Aesthetics segment.

Previous wording

Gross profit for the six months ended June 30, 2025, decreased 5.2% to $12.7 million, compared to $13.4 million for the same period in the prior year. Gross margin for the six months ended June 30, 2025, was 61.3%, compared to 60.0% for the same period in 2024. The increase in gross margin for the six months ended June 30, 2025 from the prior year period is primarily attributable to mix between our segments with Advanced Energy comprising a higher percentage of total sales and product mix within our Advanced Energy segment. These increases were partially offset by a decrease in the average selling price of generators to domestic customers and product mix within our OEM segment.

Current wording

Gross profit for the nine months ended September 30, 2025, increased 3.2% to $21.0 million, compared to $20.4 million for the same period in the prior year. Gross margin for the nine months ended September 30, 2025, was 62.5%, compared to 60.2% for the same period in 2024. The increase in gross margin for the nine months ended September 30, 2025 from the prior year period is primarily attributable to mix between our segments with Surgical Aesthetics comprising a higher percentage of total sales, geographic mix, with domestic sales comprising a higher percentage of total sales. These increases were partially offset by changes in product mix within our OEM segment.

Previous wording

Research and development expenses decreased 42.1% for the three months ended June 30, 2025, primarily due to lower compensation and benefits costs ($0.4 million) and lower spending on our product development initiatives and clinical studies ($0.2 million).

Current wording

Research and development expenses decreased 29.9% for the three months ended September 30, 2025, primarily due to lower compensation and benefits costs ($0.2 million) and lower spending on our product development initiatives and clinical studies ($0.1 million), as we complete the development of AYON.

Previous wording

Research and development expenses decreased 42.3% for the six months ended June 30, 2025, primarily due to lower compensation and benefits costs ($0.8 million) and lower spending on our product development initiatives and clinical studies ($0.4 million).

Current wording

Research and development expenses decreased 38.7% for the nine months ended September 30, 2025, primarily due to lower compensation and benefits costs ($1.0 million) and lower spending on our product development initiatives and clinical studies ($0.5 million), as we complete the development of AYON.

Previous wording

Professional services expense decreased 16.3% for the six months ended June 30, 2025, primarily due to a decreases in legal expenses ($0.3 million), physician and marketing consulting ($0.1 million), recruiting expenses ($0.1 million) and accounting and audit fees ($0.1 million).

Current wording

Professional services expense decreased 14.4% for the nine months ended September 30, 2025, primarily due to a decreases in physician and marketing consulting expenses ($0.4 million), legal expenses ($0.3 million), recruiting expenses ($0.1 million) and accounting and audit fees ($0.1 million). This decrease was partially offset by an increase in board of director’s stock-based compensation expense ($0.1 million), which was offset by lower board cash compensation included in selling, general and administrative expenses.

Previous wording

During the three months ended June 30, 2025, salaries and related expenses decreased 34.4%, primarily due to a decrease in salaries and benefits ($0.7 million), which was due to lower headcount following our reduction in force in the fourth quarter of 2024, lower stock based compensation expense ($0.5 million) and bonus expense ($0.4 million), as bonuses for 2025 are discretionary.

Current wording

During the three months ended September 30, 2025, salaries and related expenses decreased 9.0%, primarily due to a decrease in salaries and benefits ($0.6 million), which was due to lower headcount following our reduction in force in the fourth quarter of 2024 and lower stock-based compensation expense ($0.5 million). These decreases were partially offset by the prior year reversal of our annual bonus accrual during the third quarter of 2024 (0.7 million). Annual bonuses for 2025 are discretionary.

Previous wording

During the six months ended June 30, 2025, salaries and related expenses decreased 34.4%, primarily due to a decrease in salaries and benefits ($1.4 million), which was due to lower headcount following our reduction in force in the fourth quarter of 2024, lower stock based compensation expense ($0.9 million) and bonus expense ($0.9 million), as bonuses for 2025 are discretionary.

Current wording

During the nine months ended September 30, 2025, salaries and related expenses decreased 27.5%, primarily due to a decrease in salaries and benefits ($1.9 million), which was due to lower headcount following our reduction in force in the fourth quarter of 2024, lower stock-based compensation expense ($1.4 million) and bonus expense ($0.2 million), as bonuses for 2025 are discretionary.

Previous wording

During the three months ended June 30, 2025, selling, general and administrative expense decreased 14.4%, primarily due to lower meeting and training costs ($0.2 million), commissions ($0.2 million), travel expenses ($0.1 million), board of directors cash compensation ($0.1 million) and foreign currency gains and losses ($0.1 million). These decreases were partially offset by an increase in allowances for credit losses ($0.1 million).

Current wording

During the three months ended September 30, 2025, selling, general and administrative expense decreased 14.8%, primarily due to lower insurance expense, including claims on our policies ($0.3 million), lower meeting and training costs ($0.1 million), travel expenses ($0.1 million) and board of directors cash compensation ($0.1 million). These decreases were partially offset by an increase in commissions ($0.1 million).

Previous wording

During the six months ended June 30, 2025, selling, general and administrative expense decreased 22.7%, primarily due to lower travel expenses ($0.8 million), meeting and training costs ($0.7 million), regulatory expenses ($0.2 million), board of directors cash compensation ($0.2 million), foreign currency gains and losses ($0.2 million), sales and property taxes ($0.1 million), payment processing fees ($0.1 million) and commissions ($0.1 million). These decreases were partially offset by higher advertising expense, including trade show fees and related costs ($0.2 million) and allowances for credit losses ($0.1 million).

Current wording

During the nine months ended September 30, 2025, selling, general and administrative expense decreased 20.3%, primarily due to lower travel expenses ($0.9 million), meeting and training costs ($0.8 million), regulatory and translation expenses ($0.4 million), insurance expense, including claims on our policies ($0.3 million), board of directors cash compensation ($0.3 million), sales and property taxes ($0.1 million), payment processing fees ($0.1 million), software subscriptions ($0.1 million), foreign currency gains and losses ($0.1 million) and office supplies and shipping costs ($0.1 million). These decreases were partially offset by higher advertising expense, including trade show fees and related costs ($0.3 million) and allowances for credit losses ($0.1 million).

Previous wording

Interest income decreased approximately $0.2 million and $0.4 million for the three and six months ended June 30, 2025, respectively, when compared with the same period in the prior year. These decreases are due to a lower average balance and lower average yield in our investments in money market funds and U.S. Treasury securities included in cash and cash equivalents.

Current wording

Interest income decreased approximately $0.1 million and $0.4 million for the three and nine months ended September 30, 2025, respectively, when compared with the same period in the prior year. These decreases are due to a lower average balance and lower average yield in our investments in money market funds and U.S. Treasury securities included in cash and cash equivalents.

Previous wording

Interest expense was flat at approximately $1.4 million and $2.8 million for the three and six months ended June 30, 2025 and 2024, respectively.

Current wording

Interest expense was largely unchanged at approximately $1.4 million and approximately $4.2 million for the three and nine months ended September 30, 2025 and 2024, respectively.

Previous wording

Income tax expense was approximately $49,000 and $50,000 with effective tax rates of (1.3)% and (0.8)% for the three months ended June 30, 2025 and 2024, respectively. Income tax expense was approximately $98,000 and $103,000 with effective tax rates of (1.3)% and (0.7)% for the six months ended June 30, 2025 and 2024, respectively. For the three and six months ended June 30, 2025 and 2024, the effective rate differs from the statutory rate primarily due to the full valuation allowance recorded on the net operating loss (“NOL”) and net deferred tax assets generated during the period.

Current wording

Income tax expense was approximately $78,000 and $60,000 with effective tax rates of (4.2)% and (1.3)% for the three months ended September 30, 2025 and 2024, respectively. Income tax expense was approximately $176,000 and $163,000 with effective tax rates of (1.8)% and (0.9)% for the nine months ended September 30, 2025 and 2024, respectively. For the three and nine months ended September 30, 2025 and 2024, the effective rate differs from the statutory rate primarily due to the full valuation allowance recorded on the net operating loss (“NOL”) and net deferred tax assets generated during the period.

Previous wording

At June 30, 2025, we had approximately $29.3 million in cash and cash equivalents as compared to approximately $31.7 million in cash and cash equivalents at December 31, 2024. Our working capital at June 30, 2025 was approximately $39.3 million compared with $45.7 million at December 31, 2024.

Current wording

At September 30, 2025, we had approximately $25.1 million in cash and cash equivalents as compared to approximately $31.7 million in cash and cash equivalents at December 31, 2024. Our working capital at September 30, 2025 was approximately $37.8 million compared with $45.7 million at December 31, 2024.

Previous wording

For the six months ended June 30, 2025, net cash used in operating activities was approximately $1.9 million, compared with net cash used in operating activities of approximately $10.7 million in the six months ended June 30, 2024. The decrease in cash used in operations is primarily due to improvements in our accounts receivable position and the decrease in operating loss, which is a result of the cost cutting measures implemented in the fourth quarter of 2024, compared to the same period in the prior year.

Current wording

For the nine months ended September 30, 2025, net cash used in operating activities was approximately $5.5 million, compared with net cash used in operating activities of approximately $15.5 million in the nine months ended September 30, 2024. The decrease in cash used in operations is primarily due to improvements in our accounts receivable and accounts payable positions and the decrease in operating loss, which is a result of the cost cutting measures implemented in the fourth quarter of 2024, compared to the same period in the prior year. These decreases were partially offset by cash used to procure inventory as we commenced the commercial rollout of AYON during the period and decreases in non-cash expenses included in our operating losses.

Previous wording

Net cash used in investing activities for the six months ended June 30, 2025 and 2024, was $0.3 million related to investments in property and equipment.

Current wording

Net cash used in investing activities for the nine months ended September 30, 2025 and 2024, was $0.8 million and $0.5 million, respectively, related to investments in property and equipment.

Previous wording

Net cash provided by financing activities for the six months ended June 30, 2025 was $50,000 and was primarily related to contributions to the China JV by the non-controlling member.

Current wording

Net cash provided by financing activities for the nine months ended September 30, 2025 was $95,000 and was primarily related to contributions to the China JV by the non-controlling member and proceeds on the exercise of stock options.

Previous wording

On November 7, 2024, we entered into an amendment to the Perceptive Credit Agreement. The amendment reduced the financial covenant trailing twelve-month revenue targets relating to its Advanced Energy segment (tested quarterly), with amended year-end targets of $37.0 million, $52.4 million and $60.3 million for 2025, 2026 and 2027, respectively. The amendment also introduced a maximum operating expense financial covenant, with full year targets of $40.0 million and $45.0 million for 2025 and 2026, respectively. The Perceptive Credit Agreement, as amended, continues to contain customary affirmative and negative covenants, including covenants limiting the ability of us and our subsidiaries, among other things, to incur debt, grant liens, make distributions, enter certain restrictive agreements, pay or modify subordinated debt, dispose of assets, make investments and acquisitions, enter into certain transactions with affiliates, and undergo certain fundamental changes, in each case, subject to limitations and exceptions set forth in the Perceptive Credit Agreement. Additionally, we must maintain a balance of $3.0 million in cash and cash equivalents during the term of the Perceptive Credit Agreement. As of June 30, 2025, we were in compliance with the financial covenants contained within the Perceptive Credit Agreement, as amended. Our continued compliance with covenants is subject to meeting or exceeding forecasted Advanced Energy revenues, as amended and reducing operating expenses.

Current wording

On November 7, 2024, we entered into an amendment to the Perceptive Credit Agreement. The amendment reduced the financial covenant trailing twelve-month revenue targets relating to its Surgical Aesthetics segment (tested quarterly), with amended year-end targets of $37.0 million, $52.4 million and $60.3 million for 2025, 2026 and 2027, respectively. The amendment also introduced a maximum operating expense financial covenant, with full year targets of $40.0 million and $45.0 million for 2025 and 2026, respectively. The Perceptive Credit Agreement, as amended, continues to contain customary affirmative and negative covenants, including covenants limiting the ability of us and our subsidiaries, among other things, to incur debt, grant liens, make distributions, enter certain restrictive agreements, pay or modify subordinated debt, dispose of assets, make investments and acquisitions, enter into certain transactions with affiliates, and undergo certain fundamental changes, in each case, subject to limitations and exceptions set forth in the Perceptive Credit Agreement. Additionally, we must maintain a balance of $3.0 million in cash and cash equivalents during the term of the Perceptive Credit Agreement. As of September 30, 2025, we were in compliance with the financial covenants contained within the Perceptive Credit Agreement, as amended. Our continued compliance with covenants is subject to meeting or exceeding forecasted Surgical Aesthetics revenues, as amended and reducing operating expenses.

Previous wording

At June 30, 2025, we had purchase commitments totaling approximately $3.6 million, substantially all of which is expected to be purchased within the next twelve months.

Current wording

At September 30, 2025, we had purchase commitments totaling approximately $4.4 million, substantially all of which is expected to be purchased within the next twelve months.