NeuroPace, Inc. reported a revenue increase of 24% for the first quarter of 2025, reaching $22.5 million compared to $18.1 million in the same period of 2024. This growth was primarily driven by a higher volume of RNS System units sold. The company's gross profit also rose by 30% to $17.3 million, resulting in a gross margin of 77%, up from 73.6% in the prior year. Despite the revenue growth, NeuroPace recorded a net loss of $6.6 million, an improvement from the $8.9 million loss reported in the first quarter of 2024.
Operating expenses for the quarter totaled $22.5 million, an increase of 8% from $20.9 million in the previous year. Research and development expenses rose by 29% to $7.4 million, reflecting increased personnel costs and clinical trial expenses. Selling, general, and administrative expenses slightly decreased to $15 million, primarily due to reduced personnel-related costs. The company’s interest expense decreased to $2.2 million, attributed to a lower effective interest rate on its term loan.
In terms of strategic developments, NeuroPace completed a follow-on offering in February 2025, generating $69.7 million in net proceeds. A significant portion of these funds, $49.5 million, was used to repurchase shares from a major stockholder, KCK Ltd. The company also announced its intent not to renew its distribution agreement with DIXI Medical, which is set to expire in September 2025. This decision allows NeuroPace to focus on its core products while managing inventory during the wind-down period.
As of March 31, 2025, NeuroPace had cash, cash equivalents, and short-term investments totaling $66.3 million, alongside an accumulated deficit of $537.5 million. The company continues to face challenges in achieving profitability, having incurred operating losses since its inception. However, management believes that existing cash resources will support operations for at least the next 12 months. Looking ahead, NeuroPace plans to invest in research and development, clinical studies, and expanding its commercial efforts to enhance the adoption of its RNS System, which is designed to treat drug-resistant epilepsy.
About NeuroPace Inc
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