AtriCure raises 2025 revenue outlook to $532M–$534M as product launches propel double-digit growth

Earnings Call Insights: AtriCure (ATRC) Q3 2025

MANAGEMENT VIEW

* Michael H. Carrel, CEO, highlighted "a very strong third quarter with total revenue of $134 million, reflecting a 16% increase year-over-year." He cited expanding adoption across key franchises and robust global market opportunities as primary drivers. Management reported "nearly $18 million of adjusted EBITDA and over $30 million in cash generated in the third quarter," and stated that revenue growth and profitability "exceeded expectations for the quarter, and we will once again raise guidance for the year."
* Carrel emphasized the momentum from recent product launches, stating "the AtriClip FLEX-Mini and cryoSPHERE MAX devices are propelling outstanding growth in appendage and pain management in the United States," while "the launch of our EnCompass Clamp is driving accelerated growth in Europe." He also shared that AtriCure completed enrollment of over 6,500 patients in the LeAAPS clinical trial and announced approvals of new AtriClip devices in Japan.
* Angela Wirick, Chief Financial Officer, reported "third quarter 2025 worldwide revenue of $134.3 million increased 15.8% on a reported basis and 15.1% on a constant currency basis when compared to the third quarter of 2024, reflecting healthy adoption across key product lines and markets." Wirick added that "we recognized $17.8 million in adjusted EBITDA, roughly $10 million above the third quarter of 2024," and "our basic and diluted net loss per share as well as the adjusted loss per share was $0.01 in the third quarter of 2025 as compared to $0.17 in the third quarter of 2024."

OUTLOOK

* Wirick announced, "we now expect to achieve approximately $532 million to $534 million in full year 2025 revenue, reflecting approximately 14% to 15% growth compared to 2024." She added, "we are raising our positive adjusted EBITDA outlook to approximately $55 million to $57 million for the full year 2025, corresponding to an adjusted loss per share of approximately $0.23 to $0.26."
* Management continues to focus on expanding in underpenetrated global markets and advancing clinical and product initiatives. The outlook for gross margin is now "slightly higher than 2024 with the potential for varying impacts from geographic and product mix."

FINANCIAL RESULTS

* Third quarter U.S. revenue was $109.3 million, a 14.5% increase from the third quarter of 2024. International revenue totaled $25 million, up 22% on a reported basis, with European sales contributing $15.2 million and Asia Pacific and other international markets $9.8 million.
* Gross margin was 75.5%, an increase of 59 basis points from the third quarter of 2024. Operating expenses were $101.1 million, up 7.4% year-over-year. Research and development expenses rose 9.2% from the third quarter of 2024. SG&A expenses increased 6.8%.
* The company ended the quarter with $147.9 million in cash and investments, including a $6 million onetime cash inflow from a sale-leaseback transaction.

Q&A

* John Young, Canaccord Genuity: Asked about the impact of CMS proposal for ablations in the ASC setting and opportunity in Japan. Carrel responded, "I don't know that that's going to have a material effect on the overall EPi-Sense business... what's going to drive the EPi-Sense business is going to be as they have non-responders to PFA." On Japan, Carrel explained, "there's about 40,000 or so cardiac surgeries in Japan in totality" and expects to "roll out sometime next year" but does not anticipate near-term revenue contribution.
* Lilia-Celine Lozada, JPMorgan: Inquired about open business growth and CABG penetration. Carrel attributed growth to "CABG patients because those surgeons have typically not done a good job of actually doing any kind of ablation ... we're maybe at approaching 10% of the CABG patients that have -- Afib are getting treated."
* Lozada followed up on profitability guidance. Wirick cited "some strength in the quarter with the shifting mix" and "starting to realize some efficiency from our manufacturing, specifically with the EnCompass Clamp." She noted a "bit of conservatism on the bottom line, but then also starting to ramp up some of the R&D initiatives in the fourth quarter."
* Marie Thibault, BTIG: Asked about sustainability of Open Clip growth. Carrel stated "we're still in less than 30% of all sites in the United States with that product today. So we feel like there's a lot of upside."
* John McAulay, Stifel: Asked about fourth quarter revenue dynamics and PFA program updates. Wirick reiterated confidence in guidance and noted "fourth quarter last year, you did have a couple of the new product launches hitting there." Carrel confirmed first-in-human use of PFA by the end of this year or early next year.
* Joseph Conway, Needham: Asked about cryoXT launch and pain management portfolio in Europe. Carrel described cryoXT as a "very focused launch at this point in time" with broader contribution expected in 2026. On Europe, "we do have our cryoSPHERE over there."
* Danielle Antalffy, UBS: Asked about sustainability of open ablation growth and the impact of upcoming trials. Carrel emphasized "awareness for the product" and the importance of clinical trials like BoxX-NoAF and LeAAPS as growth drivers.
* Anna, Piper Sandler: Asked about competition in appendage management. Carrel said, "competition is inevitable in medical devices... we feel like we've got the best products in the market... I do welcome competition."

SENTIMENT ANALYSIS

* Analyst questions centered on growth sustainability, market penetration, guidance conservatism, new product launches, and competitive positioning, reflecting a slightly positive to neutral tone, with interest in future growth and cautiousness on certain segments.
* Management maintained a confident tone, using phrases such as "we are confident in the long-term growth trajectory" and "we are executing well on our growth and profitability objectives," but acknowledged headwinds in hybrid therapy and conservatism in guidance.
* Compared to the previous quarter, both analyst and management sentiment remained positive, with management displaying increased confidence due to continued revenue growth and improved profitability.

QUARTER-OVER-QUARTER COMPARISON

* Guidance for full-year 2025 revenue was raised from $527 million–$533 million to $532 million–$534 million, and the adjusted EBITDA outlook increased from $49 million–$52 million to $55 million–$57 million.
* Gross margin guidance shifted from "comparable to 2024" to "slightly higher than 2024."
* Sequential revenue declined 1.4% due to normal seasonality, while the previous quarter saw a 10.1% sequential increase.
* Product launches and market expansion, especially in pain management and appendage management, continued to be key drivers, with further penetration in underpenetrated U.S. and international markets noted.
* Management tone remained confident, emphasizing innovation and successful execution, while analysts continued to probe on sustainability and guidance conservatism.

RISKS AND CONCERNS

* Management acknowledged ongoing softness in the hybrid therapy franchise due to increased adoption of PFA catheter technology in the U.S.
* There was mention of conservatism in guidance, particularly related to increased R&D spending and expectations for the fourth quarter.
* Analyst concerns included sustainability of high growth rates in key franchises, the timing of new product contributions (e.g., cryoXT), and competitive threats in appendage management.

FINAL TAKEAWAY

AtriCure delivered strong third quarter results, driven by double-digit revenue growth, robust product launches, and continued expansion in key franchises. Management raised full-year guidance for both revenue and adjusted EBITDA, citing broad-based adoption, innovation, and operational efficiency. While challenges persist in hybrid therapy and competitive pressures remain, the company remains confident in its long-term market opportunity, execution on strategic priorities, and ability to deliver sustainable growth heading into 2026.

Read the full Earnings Call Transcript [https://seekingalpha.com/symbol/atrc/earnings/transcripts]

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