NeuroPace Reports $22.1 Million Revenue in Q1 2026, Net Loss of $6.7 Million

NeuroPace, Inc. reported a revenue of $22.1 million for the first quarter of 2026, a decrease of 2% from $22.5 million in the same period of 2025. The decline in revenue was primarily attributed to the termination of the Distribution Agreement with DIXI Medical, which had previously contributed to sales. However, this was partially offset by an increase in the number of RNS System units sold, driven by a higher volume of initial implants and replacements. The company recorded a gross profit of $18.0 million, resulting in a gross margin of 81.8%, an increase from 77.0% in the prior year, largely due to reduced costs associated with the DIXI Medical products.

Operating expenses rose to $23.6 million, up 5% from $22.5 million in the previous year. This increase was driven by higher sales and marketing expenses, which grew by 5% to $11.6 million, reflecting investments in personnel and marketing initiatives. General and administrative expenses also saw a significant rise of 20%, totaling $4.8 million, primarily due to increased personnel-related costs. The company reported a net loss of $6.7 million for the quarter, slightly higher than the $6.6 million loss recorded in the same period last year.

In terms of operational metrics, NeuroPace's accumulated deficit reached $559.1 million as of March 31, 2026. The company had cash, cash equivalents, and short-term investments totaling $54.0 million, down from $61.1 million at the end of 2025. The company utilized $5.9 million in cash for operating activities during the quarter, an improvement from the $7.5 million used in the same period of the previous year. The decrease in cash used in operations was attributed to a reduction in net loss and adjustments for non-cash charges.

Strategically, NeuroPace is focusing on expanding its RNS System's indications for use, including studies for drug-resistant idiopathic generalized epilepsy and pediatric patients. The company is also enhancing its sales force and marketing efforts to increase adoption of its products across comprehensive epilepsy centers in the U.S. Following the termination of the DIXI Medical distribution agreement, NeuroPace expects to complete the return of remaining inventory by June 30, 2026, which may lead to the presentation of the DIXI operations as discontinued in future financial statements.

Looking ahead, NeuroPace anticipates continued investment in research and development, clinical studies, and commercial activities to support its growth. The company believes its existing cash and investments will sustain operations for at least the next 12 months, although it may seek additional funding to support ongoing initiatives. The company remains committed to enhancing its RNS System and expanding its market presence, despite the challenges posed by a competitive landscape and the need for ongoing capital.