Good morning, ladies and gentlemen, and welcome to the Apyx Medical Fourth Quarter and Full Year 2025 Earnings Conference Call. I would now like to turn the conference call over to Jeremy Feffer, LifeSci Advisors. Please go ahead.

Thank you, and welcome, everyone, to our fourth quarter and full year 2025 earnings call. Representing the company on the call are Charlie Goodwin, Chief Executive Officer; and Matt Hill, Chief Financial Officer of Apyx. Before we begin, I would like to remind everyone that our remarks and responses to your questions today may contain forward-looking statements that are based on the current expectations of management and involve inherent risks and uncertainties that could cause actual results to differ materially from those indicated, including, without limitation, those identified in the Risk Factors section of our most recent annual report on Form 10-K, our most recent 10-Q filing and the company's other filings with the Securities and Exchange Commission. Such factors may be updated from time to time in our filings with the SEC, which are available on our website. We undertake no obligation to publicly update or revise our forward-looking statements as a result of new information, future events or otherwise. This call will also include references to certain financial measures that are not calculated in accordance with generally accepted accounting principles, or GAAP. We generally refer to these as non-GAAP financial measures. Reconciliations of these non-GAAP financial measures to the most comparable measures calculated and presented in accordance with GAAP are available in the earnings press release on the Investor Relations portion of our website. I would now like to turn the call over to Mr. Charlie Goodwin, Apyx Medical's President and Chief Executive Officer. Please go ahead.

Thank you, Jeremy, and thank you all for joining us today. Per our usual format on these quarterly calls, I will begin with a review of our performance over the past several months and then turn the call over to Matt for a review of our fourth quarter and full year 2025 financial results, along with our guidance for full year 2026. We will then open the call for your questions. Let me begin with a review of a few key highlights from our fourth quarter and full year 2025 performance. We reported record revenue of $19.2 million compared to $14.2 million in the same period last year. This growth was driven by a 38% increase in sales of our surgical aesthetics products to $16.7 million for the fourth quarter, which was primarily attributable to sales of our AYON body contouring system. As many of you are aware, the fourth quarter represents the first full quarter of AYON sales following its full commercial launch in September of 2025. As a result, this is a very telling moment for us as a company as we begin to see the market excitement we have discussed over the past several quarters meaningfully reflected in our financial results. Looking back since unveiling AYON approximately one year ago when it was submitted for FDA clearance, we have seen a steady and consistent rise in market interest. Following market clearance in May of 2025, we initiated a soft launch that generated overwhelmingly positive feedback from the early adopters, and it quickly became clear to our team that this system was special and positioned us to have significant impact on the future of the aesthetic surgery market. I am excited to report that this positive feedback has translated into strong market demand and sales following full launch, and we continue to ramp our operations to meet this demand. As I have mentioned previously, our team was well prepared for the full commercial launch, including strong preorders generated during the soft launch. To date, the launch of AYON and the level of incoming interest from customers submitting orders has exceeded our expectations across every metric. As we look at the market's reaction to AYON, it is clear that the reception aligns with what this technology is designed to deliver, and we believe its adoption curve is still in the very early stages. AYON is a groundbreaking body contouring system designed by leading surgeons to address many of the challenges and limitations of existing systems. Unlike most systems on the market, which are limited to a single function, AYON seamlessly integrates fat removal, closed-loop contouring, tissue contraction and electrosurgical capabilities, empowering surgeons to deliver the most comprehensive body contouring treatments available. With advanced features such as LIFT Technology for real-time adjustments and Renuvion for enhanced tissue contraction, AYON sets a new standard in surgical care by streamlining procedures and maximizing patient outcomes. The result is a system that combines precision, versatility and innovation in an all-in-one platform, offering surgeons an unmatched return on investment. Importantly, the plastic surgery market has not seen a device with this level of advancement in many years. When we first introduced AYON and discussed the initial capabilities, we also committed to submitting a follow-up 510(k) for label expansion to include power liposuction. During the fourth quarter, our team submitted this follow-up application. Since then, we have engaged in productive discussions with the FDA. Based on this progress, we now anticipate receiving market clearance in mid-2026. Achieving market clearance for power liposuction will further strengthen AYON's position as the first fully integrated body contouring system, positioning it as the new gold standard in surgical aesthetics. Importantly, upon receiving clearance, we will be able to activate this function on systems already in the field. We will also be able to launch our power-assisted liposuction handpieces and continue to expand our revenue. With these continued enhancements to the platform and the strong feedback we are receiving from surgeons, AYON is well positioned to capitalize on the broader shifts occurring in the aesthetics market. At the same time, the market itself continues to evolve. Over the past year, we have seen the space begin to emerge from a period of softer demand and that renewed momentum we are seeing today looks very different from what drove the market just five years ago. As I have said on previous calls, one of the biggest new drivers of this shift is the rapid adoption of GLP-1 drugs for weight loss. A growing number of these patients are experiencing skin laxity after significant weight loss and after patients achieve their weight loss goals, we believe they will be seeking treatments for the resulting loose and lax skin. This is where GLP-1 headwinds turn into tailwinds for companies uniquely positioned to provide the tools for those treatments like Apyx Medical. Our Renuvion system, which is available as both a stand-alone offering and an integrated component of AYON, has proven to be an exceptional treatment option for this type of skin laxity. We believe Renuvion is best-in-class and should be considered the new standard of care, particularly for patients experiencing loose or lax skin after rapid weight loss. With more than 15 million people currently on GLP-1 drugs in the U.S. alone, we believe we are still in the early innings of a powerful market shift. Apyx is uniquely positioned to help meet this demand and lead the aesthetics market into the next phase of growth. I will close this thought by highlighting that the shift in patient results as well as the financial resources they are directing toward treatments being driven by the widespread adoption of GLP-1 drugs are unlike anything the weight loss and plastic surgery markets have experienced in recent history. This shift represents a tremendous opportunity, and we are very fortunate to already have a solution in our portfolio that delivers best-in-class durable outcomes for these patients. As we look to take full advantage of this momentum behind our business, we are actively strengthening our commercial organization by acquiring high-caliber sales talent aligned with our next phase of growth. These new team members are expected to increase our ability to build market share as well as deepen our ability to support surgeons through training, onboarding and practice development, which we know are critical to accelerating market adoption. To be clear, these investments will be measured and aligned with the growth trajectory of our business. As a reminder, it is just over a year ago that we successfully implemented significant cost reduction and restructuring, and we have no plans to reverse the progress achieved through that effort. We are proud of the restructuring efforts that have resulted in a leaner operating structure and meaningfully reduced our cash burn. These improvements strengthened our overall financial health, giving us the flexibility to invest in AYON and our broader growth strategy with confidence. It is encouraging to reflect on the positive outcome driven by our team's dedication and perseverance. I will close my comments by saying how pleased I am by the progress we have made over these past several months since the launch in September. We believe we have just scratched the surface of the overall market for AYON, and we look forward to realizing our long-term vision of walking into almost every surgical practice and seeing an AYON system at the center of the operating room. I will now turn the call over to Matt to review our fourth quarter and full year 2025 results in more detail, along with our financial guidance for 2026.

Thank you, Charlie. Before I get started, please note all references to fourth quarter and full year financial results will be on a GAAP and year-over-year basis, unless noted otherwise. As Charlie mentioned, total revenue for the fourth quarter 2025 increased 35% to $19.2 million compared to $14.2 million in the prior year period. Revenue for the Surgical Aesthetics segment increased 38% or $4.6 million to $16.7 million compared to $12.1 million for the prior year period. As Charlie referenced, this growth was driven by sales of AYON as the company commenced its commercial launch in September and 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 net sale, and upgrades to the Apyx One Console in international markets. Overall, Surgical Aesthetics sales domestically increased by nearly 50% from the prior year period. Turning to the OEM segment, sales increased 16% or approximately $0.3 million to $2.5 million for the fourth quarter of 2025 compared to $2.1 million for the fourth quarter of 2024. The increase in OEM sales was due to an increase in sales volume to existing customers, including Symmetry Surgical under our 10-year generator manufacturing and supply agreement. Domestic revenue increased 42% year-over-year to $15 million and international revenue increased 15% year-over-year to $4.2 million. As a reminder, the medical device industry typically experiences some seasonality with revenue trends generally lowest in the first and third quarters and strongest in the second and fourth. Gross profit for the fourth quarter 2025 increased to $12 million compared with $9 million in the prior year period. Gross profit margin for the fourth quarter 2025 decreased to 62.6% compared to 63% in the prior year period. Operating expenses were flat year-over-year at $12 million for the fourth quarter 2025 as well as the prior year period. There were certain shifts in the underlying expenses with $0.2 million decreases for selling, general and administrative expenses and research and development expenses, which were offset by $0.2 million increases in salaries and related costs and professional service expenses. Income from operations was $11,000 compared with a loss from operations of $3 million in the fourth quarter of 2024. Net loss attributable to stockholders was $1.3 million or $0.03 per share for the fourth quarter of 2025 compared with $4.6 million or $0.12 per share in the prior year period. Adjusted EBITDA was $0.7 million compared to an adjusted EBITDA loss of $2.2 million in the fourth quarter of 2024. As a reminder, we provide a detailed reconciliation from net loss attributable to stockholders to non-GAAP adjusted EBITDA in our earnings press release. For the three months ended December 31, 2025, cash used in operating activities decreased to $2.5 million compared with $2.9 million used in the prior year period. For the year ended December 31, 2025, cash used in operating activities decreased to $8 million compared to $18.7 million used in the prior year period. We were pleased with the cash and working capital management in the full year 2025 with cash burn returning to a lower but more normalized rate in the back half of the year as a result of the impact of changes in working capital as a result of AYON's launch. As of December 31, 2025 and 2024, the company had cash and cash equivalents of $31.7 million. We believe based on our projections, including the uptake of the AYON platform, working capital management and our continued strict cost controls, we will have cash through 2027. Turning to our 2026 guidance. For the 12 months ended December 31, 2026, we expect total revenue in the range of $57.5 million to $58.5 million. This reflects approximately a 9% to 11% increase as compared to the full year of 2025. This is the result of an increase in sales in our Surgical Aesthetics segment and a decrease in sales in our OEM segment. Our revenue guidance assumes Surgical Aesthetics segment revenue in the range of $53 million to $54 million. This reflects a 17% to 19% increase compared to 2025. OEM revenue is expected to come in at approximately $4.5 million as compared to $7.5 million for 2025. This decrease continues to reflect our decision to focus our resources on the Surgical Aesthetics segment. We now anticipate gross margins of approximately 61% to 62% for the year and total operating expenses not to exceed $45 million. As Charlie mentioned, we are pleased to see the result of our cost-cutting measures taken in the fourth quarter of 2024 in our current numbers. We believe the company performance in 2025 reflects the great team we have here at Apyx. To summarize, in just one year, this team submitted for and received FDA clearance and subsequently launched a groundbreaking new product into a space with significant headwinds. Despite that backdrop, we delivered 10% overall sales growth and 17% growth in Surgical Aesthetics, achieving record sales in the fourth quarter. And we accomplished this while simultaneously reducing operating expenses to $39.5 million, down from $48.2 million in 2024 and $53.7 million in 2023. As a result, we are excited to report positive EBITDA in the fourth quarter. Now we are projecting continued growth into 2026 as we continue to manage our expenses. It is indeed an exciting time here for Apyx. This completes our prepared remarks. Charlie and I will now open the call for questions.

Your first question is from David Turkaly from Citizens.

Congrats. Charlie, I think I heard some commentary about handpiece and capital equipment sales, but I was wondering if we might be able to get a little more color maybe just even domestically. Obviously, we know the aesthetic growth rate in the quarter. But I was wondering if you could maybe give us color, I would imagine maybe capital is growing faster given AYON, but could you comment on directionally which is growing faster and then maybe if capital is seeing a price uptick?

When you say CapEx, do you mean handpieces? What do you mean by CapEx?

Capital, capital equipment. Just system sales.

Yes. Our growth in the fourth quarter was definitely driven by AYON, and that was our focus as a company. It was our focus as a sales team, especially in the United States, driving AYON systems. The whole organization was working hard to produce systems, and we were selling systems. That was the driver of growth in the fourth quarter for us. Domestically, we grew almost 50% in the U.S., and I think it was 38% as a total company. So it was on the back of AYON. It was on the back of this revolutionary platform for sure.

Your next question is from Sam Eiber from BTIG.

Congrats on a nice finish to the year. Charlie, sitting here, I guess, six months into the AYON launch, what's been going well? What's going better than expectations? What are some things that maybe you have to fine-tune? I'd love any updates on what you're hearing from customers and from the commercial reps out in the field.

It's a great question. The great news is it's all good news. The customers love AYON. The one thing they would like to have with AYON is the power-assisted handpiece, which we expect in the first half of the year because that completes the liposuction portion of AYON. There is no question that many people want the power-assisted portion. But the feedback from AYON itself has exceeded every expectation we had. The launch has gone incredibly well. There have been a couple of minor hiccups along the way, but the team has done an incredible job of resolving those and making sure that everybody is happy with the system. As we said in the prepared remarks, every metric that we had has been met or exceeded with AYON. There is nothing like this system in the marketplace today. We have not encountered a single surgeon who hasn't thought it's a great idea, liked it, and considered bringing it into their practice. We are just getting started. While it's been six months since approval, we didn't start shipping until September, and we are still waiting on the power-assisted handpiece to complete the liposuction offering for AYON.

Very good. And maybe just a quick follow-up for Matt. Thinking about the gross margin guidance relative to 2025, is it fair to think that may be a little conservative considering the mix, since OEM is expected to be lighter next year? I'd love to hear the puts and takes to the gross margin guidance.

Sam, great question. Any time we're giving guidance, we're trying to be as conservative as possible. It will depend on the levers: the lower margins coming out of OEM compared to the higher margins in the Surgical Aesthetics segment, offset by sales mix geographically. So if we have higher sales in China, that will affect full year sales and geographic mix. There will be some geographic mix effects to consider.

Your next question is from Alex Fuhrman from Lucid Capital Markets.

Congratulations on the strong AYON launch and a strong year in 2025. I wanted to ask about the new salespeople that you're adding. Can you talk a little bit about how you're dividing territory and incentivizing the sales force? Where do you see the most opportunity to leverage these new hires?

As far as territories go, we've made some changes with our current team. The nice thing with AYON is it puts us in a position of strength to attract top talent in the industry. We brought John Featherstone in to help with that. In the aesthetics industry, and especially on the surgical side, I don't know of a more exciting product or platform than AYON to be selling today. It really strengthens our company. We are no longer just a one-technology company; we've got a whole suite of offerings for body contouring. With the change in the patient population due to GLP-1 drugs and the associated weight loss and loose, lax skin, body contouring becomes a huge part of the doctor's practice. We think AYON and Renuvion are uniquely positioned to provide the tools to address these patients. From our perspective, it's the perfect time to recruit the best sales talent to execute and drive this for many years to come.

Your next question is from Matt Hewitt from Craig-Hallum. This is Tollef Kohrman on for Matt Hewitt.

Can you remind us what countries AYON is approved in? And what your plans are for further expansion there?

You asked about AYON specifically, correct? Right now, it's approved in the United States. There are a couple of countries outside the United States that accept FDA clearance, and it is registered in a few places, including some in the Middle East and the Caribbean. This year, we plan to register it in many key countries outside the United States, with Europe, Brazil and Colombia being high on that list. We are just getting started globally and have many areas to register and sell in.

With the liposuction label expansion now expected midyear, did you incorporate any contribution from that this year? Or does that represent upside?

We typically do not forecast items we don't have approval for. We will still be selling AYON consoles and those consoles were included in the guidance. The handpieces themselves will be treated as upside.

Your next question is from Kyle Bauser from ROTH Capital Partners.

On console sales: AYON was a big reason for the strong results to the end of the year last year. Going forward, are the majority of console sales AYON, or are they still Renuvion? I'm trying to get a sense of that mix and what you anticipate. Also, Matt, in your prepared remarks you mentioned something about 2027. I believe it was about being cash through 2027 and cash flow positive timing. Can you clarify and what assumptions we should watch to achieve cash flow generation?

We still sell Renuvion only even in the United States where we have AYON. If someone only wants the skin-tightening portion for their practice, we will sell stand-alone Renuvion. Outside the United States, we don't yet have AYON registered, so we are selling stand-alone Renuvion there. We will always have both available because Renuvion is an important tool for treating these new patients. As far as mix goes in the U.S., I would expect more people will acquire Renuvion through AYON over time, but outside the U.S. it is currently Renuvion only.

Great question, Kyle. From a cash perspective, we said we expect to have cash through 2027 based on our projections. The plan is to be cash flow positive no later than the fourth quarter of 2026.

There are no further questions at this time. I will now hand the call back over to Charlie Goodwin for the closing remarks.

Thank you, everybody, for attending the call. I want to thank the entire Apyx Medical team for their dedication and tireless execution throughout 2025 and as we enter what is expected to be an exciting period of growth for 2026 as we see our plan turn into reality. We appreciate all the support we have received from our shareholders during this time, and thank you all for attending today's call. Thank you.

Thank you. Ladies and gentlemen, the conference has now ended. Thank you all for joining. You may all disconnect your lines.