SomnoMed Reports $27.7M Q3 Revenue, Confirms $105M FY25 Target
SomnoMed Limited reported a robust 23.2% revenue increase in Q3 FY25, reaffirming its full-year guidance while actively addressing new US tariffs through potential duty-free exemptions.
- Q3 FY25 revenue rose 23.2% to $27.7 million
- Cash balance strengthened to $18.7 million
- Full-year FY25 guidance reconfirmed: ~$105 million revenue, $7–9 million EBITDA
- Company pursuing Nairobi Protocol exemption to mitigate US tariffs
- Positive net cash inflow of $0.8 million in Q3
Strong Revenue Growth Across Regions
SomnoMed Limited, a leader in oral appliance treatments for sleep-related breathing disorders, has delivered a compelling performance in its Q3 FY25 results. The company reported revenue of $27.7 million, marking a 23.2% increase compared to the same quarter last year. This growth was broad-based, with all geographic segments, Europe, North America, and APAC, achieving double-digit revenue gains in constant currency terms.
Europe led with a 19.4% rise, North America surged 31.5%, and APAC grew 15.7%, underscoring SomnoMed’s expanding global footprint. The company’s ability to sustain such momentum amid evolving market dynamics highlights its strong operational execution and growing demand for its clinically proven oral appliance therapies.
Financial Position and Guidance
SomnoMed’s cash position remains robust, with a balance of $18.7 million as of 31 March 2025. The company also holds low-interest, government-backed COVID-19 loan facilities in Europe, fully drawn at $1 million, resulting in a net cash position of $17.7 million. Operating activities generated a positive net cash inflow of $0.8 million during the quarter, reflecting healthy underlying cash generation.
Importantly, SomnoMed reconfirmed its FY25 guidance, targeting approximately $105 million in revenue and an EBITDA range of $7 million to $9 million. Capital expenditure is expected to be between $3 million and $4 million, supporting ongoing innovation and capacity expansion.
Navigating US Tariff Uncertainty
In early April 2025, the company faced a new challenge with the announcement of reciprocal tariffs by the United States. However, a 90-day pause on most tariffs, effective 10 April, has provided temporary relief. SomnoMed is proactively pursuing a duty-free exemption under the Nairobi Protocol, which covers medical devices imported into the US. This exemption, if granted, would mitigate tariff impacts and ensure uninterrupted patient access to its FDA-cleared devices.
The company is currently conducting a self-assessment and working closely with advisors and US Customs and Border Protection to secure a formal ruling. This strategic approach demonstrates SomnoMed’s commitment to navigating regulatory headwinds while maintaining its market presence in the critical North American region.
Governance and Related Party Payments
During the quarter, SomnoMed made payments totaling $0.3 million to related parties, including co-CEOs and non-executive directors, in line with contractual obligations. This transparency supports investor confidence in the company’s governance practices.
Looking ahead, SomnoMed’s strong quarterly performance combined with its proactive tariff mitigation efforts position it well to capitalize on growing global demand for sleep apnea treatments. However, the final outcome of the US tariff exemption process remains a key variable to watch.
Bottom Line?
SomnoMed’s growth trajectory is intact, but US tariff resolution will be pivotal for sustaining momentum.
Questions in the middle?
- Will SomnoMed secure the Nairobi Protocol exemption to fully offset US tariffs?
- How might tariff-related uncertainties affect North American revenue in coming quarters?
- What are the company’s plans for capital expenditure to support future growth?
