PROCEPT BioRobotics (NASDAQ:PRCT) reported fourth-quarter 2025 results that were marked by strong U.S. procedure growth but lower-than-expected consumable revenue, as management implemented changes to inventory practices and pricing discipline for its handpieces. Executives also outlined a commercial reorganization that they said is intended to support higher procedure volume, improved margins, and a path to profitability.
Commercial changes and pricing discipline
CEO Larry Wood, who discussed progress since joining the company, said PROCEPT is shifting its operational focus toward increasing procedure volume, expanding margins, achieving profitability, and gaining market share. He highlighted two changes to the commercial organization:
- A realignment into an integrated regional structure where clinical and sales functions report to a common regional leader, creating “a single point of accountability” for customer success and procedure growth.
- The creation of a dedicated launch team, staffed by reassigning some top performers to focus on new system placements, with the goal of reducing variability in launches and accelerating “time to value” for customers.
A key driver of the quarter’s revenue shortfall, executives said, was a shift in customer handpiece ordering behavior. Wood said the company eliminated the “historical practice of providing discounts on bulk purchases,” particularly late in the quarter, despite customer requests. The change followed a deeper review of how discounting had influenced end-of-quarter purchasing patterns.
Fourth-quarter operational results
In the fourth quarter, PROCEPT completed approximately 12,200 U.S. procedures, which management said reflected about 69% year-over-year growth. CFO Kevin Waters reported that handpieces sold totaled 9,400 units, and that handpiece unit sales were about 80% of procedures in the quarter. Wood emphasized that, for the first time, procedures exceeded handpieces sold.
While the shift reduced revenue relative to expectations, it improved pricing. The average fourth-quarter handpiece selling price was about $3,340, up $140, or roughly 5% sequentially from the third quarter. Wood said the company historically saw handpiece units exceed procedure volumes by about 8% to 16%, but based on recent months now expects handpiece unit sales and procedure volumes to be in “close alignment” going forward.
On the call, Wood and Waters reiterated that management views procedure growth as the core indicator of business health, rather than customer stocking patterns, and said the change should improve predictability by aligning shipments more closely with underlying procedures.
Financial results and margins
Total revenue for the fourth quarter of 2025 was $76.4 million, up 12% year over year. U.S. revenue was $66.6 million, up 10% from the prior-year period. U.S. handpiece and other consumable revenue totaled $34.0 million, up 16% year over year, including $2.3 million of other consumables.
In capital equipment, PROCEPT sold 65 new HYDROS systems in the quarter. Waters said the installed base ended 2025 at 718 systems, up 42% compared to year-end 2024. Total U.S. system revenue was $27.6 million, comparable to the prior year period, with an average selling price of approximately $425,000. International revenue was $9.8 million, up 25% year over year.
Gross margin in the fourth quarter was 60.6%, down from 64.0% a year earlier. Waters said the shortfall versus fourth-quarter guidance was driven primarily by lower-than-expected U.S. consumable revenue and a one-time voluntary field action that created about 240 basis points of pressure. Management described the field action as non-recurring and said it involved compatibility between the handpiece and system; Waters said there were no patient safety issues and that it was addressed through a field upgrade. The company quantified the impact at roughly $1.5 million and said it was contained to the fourth quarter.
Operating expenses in the fourth quarter were $77.4 million, up from $63.4 million in the prior year period, which Waters attributed to investment to support commercial expansion, innovation across the BPH platform, and increased funding for the WATER IV prostate cancer trial. Net loss was $29.8 million, compared with a net loss of $18.9 million a year earlier. Adjusted EBITDA was a loss of $19.0 million, compared with a loss of $10.3 million in the prior-year quarter. Cash, cash equivalents, and restricted cash totaled $285 million as of Dec. 31, 2025.
2026 guidance reset and profitability commentary
Management reset full-year 2026 revenue guidance to $390 million to $410 million, representing 27% to 33% growth versus 2025. The company said the revision reflects the impact of business practice changes that are expected to bring handpiece unit sales in line with procedure volumes, partially offset by higher expected pricing and the near-term disruption from the salesforce realignment.
Waters said the 2026 outlook assumes international revenue of $50 million to $51 million and total U.S. procedures of 60,000 to 64,000, representing 39% to 48% growth. The company now estimates U.S. handpiece average selling price at about $3,500 in 2026.
For profitability metrics, PROCEPT guided to 2026 gross margin of approximately 65%, including $5 million to $6 million of tariff expense (compared with $1.3 million in 2025), which management said is about a 100-basis-point headwind. Operating expenses are expected to be $350 million in 2026, up 17% year over year. Adjusted EBITDA loss is expected to range from $30 million to $17 million, and Waters said the revised guidance implies positive adjusted EBITDA in the fourth quarter of 2026 at both ends of the revenue range.
Near-term outlook and investor day focus
For the first quarter of 2026, PROCEPT expects total U.S. procedures of 12,000 to 12,800, representing 29% to 37% growth. Waters said management expects procedures to accelerate as commercial initiatives take hold, reaching growth of more than 50% in the second half of 2026 compared to fiscal 2025. First-quarter 2026 revenue is expected to be $79 million to $82 million, up 14% to 19%, including about $20 million of U.S. system revenue and $10 million of international revenue.
During the Q&A, Wood said the company has not seen signs that the end of bulk purchase discounts is reducing utilization, and he described the salesforce changes as a relationship-rebuilding and territory-transition issue rather than an attrition issue. He also said the company piloted the launch team model in the fourth quarter and saw about a 50% reduction in the time from purchase order to completion of a site’s first 10 cases.
Wood also said the company plans to provide a more detailed multi-year view at its investor day, including details on 2026 and 2027, the path to profitability, and an update on the WATER IV prostate cancer trial. He added that the company intends to increase transparency around procedure volumes, which he said had not been historically reported in the same way as handpiece revenue.
About PROCEPT BioRobotics (NASDAQ:PRCT)
PROCEPT BioRobotics, Inc is a medical device company specializing in the development and commercialization of robotic systems for the treatment of benign prostatic hyperplasia (BPH). The company’s technology leverages precision robotics and real-time imaging to perform minimally invasive procedures, aiming to reduce patient recovery time and improve clinical outcomes compared to traditional surgical approaches.
The company’s flagship product, the AquaBeam Robotic System, uses a high-velocity waterjet to selectively remove prostate tissue while preserving surrounding healthy structures.
