Avita Medical Inc.

AVITA reported second-quarter revenue of $21.7 million, up 18% year over year and 13% sequentially. Gross margin was 81.9% versus 81.2% in the prior-year quarter. Operating expenses were $24.6 million, operating loss was $6.9 million, and net loss was $7.7 million, compared with $11.1 million and $9.9 million, respectively, a year ago. Net cash use improved to about $3.2 million, and the company ended the quarter with $11.1 million in cash, cash equivalents, and marketable securities. Management raised full-year 2026 revenue guidance to $86 million-$89 million, implying 20%-24% growth versus 2025 revenue of $71.6 million, and said it now expects cash flow breakeven and cash generation in Q4 2026.

Carrie Vance said the quarter showed AVITA is executing its plan to build a business that delivers consistent quarter-over-quarter and year-over-year growth through disciplined commercial execution. She highlighted broadening adoption across the portfolio, with RECELL as the foundation, Cohealyx gaining traction through VAC reviews, and PermeaDerm still early but seeing encouraging initial response. Her tone was confident and forward-looking, emphasizing that reimbursement simplification, continued utilization growth, and portfolio adoption can support longer-term expansion.

David O’Toole focused on how growth is now flowing through the model: revenue rose to $21.7 million, gross margin held at 81.9%, operating expenses stayed flat sequentially at $24.6 million, and cash use improved to about $3.2 million. He said the company’s commercial operating structure is supporting growth without a matching increase in opex, and that the cash conversion cycle is improving. He also noted the balance sheet remains aligned with the company’s next phase of growth, including access to an additional $10 million tranche under the Perceptive debt facility once trailing 12-month revenue reaches $85 million.

Analysts pressed management on what was driving the higher guidance, and Vance said the answer was straightforward: the business is tracking to a higher growth trajectory than initially assumed, with customer visibility now better than earlier in the year. On reimbursement, she said the biggest issue with the prior structure was confusion about whether and when providers would get paid, and that the new Category I CPT framework should simplify coding and make reimbursement more predictable nationally. In follow-up questions, management said there is no concern about a major transition gap in 2027 because customer and association education has already started, and confirmed the Cohealyx-I full dataset remains on track for later this year.