NeuroPace Reports 22% Revenue Growth to $23.5 Million in Q2 2025

NeuroPace, Inc. reported a revenue increase of 22% for the second quarter of 2025, reaching $23.5 million compared to $19.3 million in the same period of 2024. For the first half of 2025, total revenue was $46.0 million, up from $37.4 million in the prior year, driven by higher sales of the RNS System and DIXI Medical products. Despite this growth, the company recorded a net loss of $8.7 million for the quarter, a 15% increase from the $7.5 million loss in Q2 2024. The loss for the first half of 2025 was $15.2 million, a slight improvement from the $16.4 million loss reported in the same period last year.

Operating expenses rose to $25.0 million in Q2 2025, up from $20.4 million in Q2 2024, primarily due to increased sales and marketing costs, which grew by 23% to $12.0 million. Research and development expenses also increased by 13% to $6.8 million, reflecting ongoing investments in clinical studies and product development. General and administrative expenses saw a significant rise of 34%, totaling $6.1 million, largely due to one-time severance costs. The gross margin improved to 77.1% in Q2 2025, up from 73.4% in the previous year, attributed to lower fixed costs per unit from increased production volume.

In terms of strategic developments, NeuroPace completed a follow-on offering in February 2025, raising $69.7 million in net proceeds, which were partially used to repurchase shares from a significant stockholder. The company also entered into a new credit agreement with MidCap Funding in June 2025, securing a $60 million term loan to refinance existing debt. As of June 30, 2025, NeuroPace had cash, cash equivalents, and short-term investments totaling $62.1 million, which management believes will support operations for at least the next 12 months.

Operationally, NeuroPace continues to focus on expanding its market presence, particularly in comprehensive epilepsy centers across the U.S. The company is also pursuing FDA approval for expanded indications of its RNS System, targeting both pediatric patients and those with generalized epilepsy. The company has reported a trailing 12-month net revenue of $71.6 million from the RNS System as of June 30, 2025, which is above the minimum revenue threshold required under its credit agreement.

Looking ahead, NeuroPace anticipates continued investment in research and development, clinical studies, and commercialization efforts. The company acknowledges the potential need for additional funding to support its operations and growth initiatives, particularly as it navigates a competitive landscape and seeks to enhance its product offerings.