Tariff Risks and China Entry Timing Cloud Nova Eye Medical’s Path to Profitability
Nova Eye Medical reported a robust 32% increase in global sales excluding China for Q1 FY26 and secured regulatory approval for its iTrack™ Advance device in China, setting the stage for expanded market penetration.
- Q1 FY26 global sales excluding China rose 32% to US$4.9 million
- iTrack™ Advance device approved by China’s NMPA in September 2025
- FY26 sales guidance reaffirmed at US$21-24 million excluding China
- Group cash outflow improved to A$798,000 with A$4 million cash on hand
- EBITDA breakeven expected in H2 FY26, influenced by China market entry timing
Strong Sales Momentum Outside China
Nova Eye Medical Limited (ASX – EYE) has kicked off FY26 with a solid performance, reporting a 32% increase in global sales excluding China for the September quarter, reaching US$4.9 million. This growth was driven primarily by the company’s direct sales teams in the USA and Germany, which continue to outperform industry norms with an average revenue of approximately US$1.3 million per salesperson. Despite seasonal headwinds from summer holidays and slower-than-expected commercial expansion in parts of North America, the company maintained steady sales volumes compared to the previous quarter.
Regulatory Breakthrough in China
September marked a pivotal milestone for Nova Eye Medical with the National Medical Products Administration (NMPA) granting approval for the iTrack™ Advance device in China. This regulatory green light opens the door for the company to tap into one of the world’s largest glaucoma markets. While no sales were recorded in China during the quarter, a delivery valued at US$0.6 million was made in October, signaling the beginning of commercial activity. The iTrack™ Advance is expected to broaden surgeon adoption beyond the original iTrack™, which generated US$1.2 million in sales in China during FY25.
Financial Health and Outlook
Nova Eye Medical’s cash flow from operations showed marked improvement, with a reduced outflow of A$798,000 for Q1 FY26, continuing a positive trend over recent quarters. The company ended the period with A$4 million in cash and an undrawn A$2 million loan facility, providing a comfortable liquidity buffer. The firm reaffirmed its FY26 sales guidance of US$21 million to US$24 million excluding China and anticipates achieving EBITDA breakeven in the second half of the fiscal year. However, the timing of breakeven remains sensitive to the pace of sales growth in China and potential impacts from US-China trade tariffs.
Clinical and Market Engagement
Nova Eye Medical continues to build momentum through clinical validation and market presence. A recent peer-reviewed study published in the Journal of Current Glaucoma Practice highlighted the safety and efficacy of iTrack™ Advance in early glaucoma treatment, reinforcing surgeon confidence. The company also showcased its technology at major ophthalmology congresses in Europe, further supporting adoption. Additionally, Nova Eye Medical secured a $488,000 government grant to explore innovative quantum and biomedical sensing technologies aimed at early eye disease detection, particularly in indigenous communities.
Strategic Opportunities and Challenges Ahead
Beyond surgical devices, Nova Eye Medical is exploring the potential of its proprietary iTrack™ microcatheter for targeted drug delivery within the eye, a promising avenue that could diversify its product portfolio. While evaluation results from a pharmaceutical partner remain inconclusive, ongoing collaboration may unlock new therapeutic applications. Meanwhile, the company is monitoring proposed US Medicare reimbursement rates for 2026, which, if finalized as expected, will continue to incentivize the use of its products in glaucoma surgery.
Bottom Line?
With regulatory approval in China and steady sales growth elsewhere, Nova Eye Medical is poised for a transformative year, though tariff risks and market adoption will be key to watch.
Questions in the middle?
- How quickly will sales ramp up in China following iTrack™ Advance approval?
- What impact could US-China trade tariffs have on Nova Eye Medical’s export-driven revenue?
- When will the company finalize partnerships or timelines for its drug delivery technology?