Neuronetics Posts Preliminary Q4 Revenue Surge and Cash Flow Turnaround

What happened

Neuronetics announced selected preliminary unaudited financial results for the fourth quarter and full year 2025, highlighting robust revenue growth and a critical shift to positive operating cash flow. This update follows a period of significant operational challenges, including persistent negative cash flow and liquidity concerns detailed in the DeepValue master report. Q4 revenue reached $41.8 million, with full-year revenue hitting $149.2 million, representing substantial year-over-year growth on both as-reported and adjusted pro forma bases. Notably, the company achieved positive operating cash flow of $0.9 million in Q4, a stark improvement from the -$20.5 million reported in the first half of 2025, and ended the year with total cash of $34.1 million. While these figures suggest progress in the Greenbrook integration and scaling efforts, they remain preliminary and require validation through audited financials.

Implication

Near-term, the shift to positive operating cash flow and increased cash reserves may alleviate immediate liquidity pressures, potentially extending the runway beyond the previously stated 12 months and reducing near-term dilution risks. Revenue growth, particularly the 86% year-over-year increase in Q4 on an as-reported basis, suggests strong top-line momentum post-Greenbrook acquisition, though the more modest 15% adjusted pro forma full-year growth hints at underlying challenges in organic scaling. Investors should scrutinize the sustainability of this cash flow improvement, as it remains minimal and could be volatile given historical losses and integration frictions. Long-term, if audited results confirm these trends and clinic efficiencies materialize, it could support a thesis shift toward BUY, but reimbursement dynamics and competitive intensity persist as headwinds. Monitoring quarterly metrics like cash flow trends and revenue mix will be crucial to assess whether management's integration claims hold up beyond preliminary reporting.

Thesis delta

The preliminary results address key watch items from the DeepValue report by showing revenue growth and cash flow improvement, potentially moving the needle toward a more positive outlook. However, since the data is unaudited and integration execution remains unproven, the core HOLD thesis persists, requiring sustained OCF positivity and margin gains for an upgrade. A shift to BUY would depend on consistent demonstration of these improvements in future audited filings.