In the third quarter of 2024, Medicalgorithmics focused on increasing service sales and acquiring new clients, in line with its adopted strategy. During this period, service revenue amounted to PLN 5.2 million, with a 24% increase in the U.S. market compared to the second quarter, reaching PLN 1.2 million. This represents a recovery of 53% of the revenue from Q4 2023. Since the adoption of the new development strategy, the company has acquired 13 new clients. The Medicalgorithmics management expects to secure a major client in the U.S. by the end of this year, in accordance with its strategy, and to achieve positive cash flows in the second half of 2025.
“We are consistently implementing our development strategy, which allows us to gradually increase service sales in the key U.S. market, develop our flagship products, and acquire new clients. The results presented, especially in relation to the U.S. market, show that our strategy is delivering results. In the coming periods, we expect continued and systematic growth, which will result in achieving positive cash flows in the second half of 2025,” said Maciej Gamrot, CFO of Medicalgorithmics.
Consolidated revenue for Medicalgorithmics in Q3 2024 amounted to PLN 5.2 million, compared to PLN 5.9 million in Q2 2024. The decline is primarily due to the absence of cyclical device sales revenue, which amounted to PLN 13,000 in the past quarter, compared to PLN 488,000 in the previous quarter. Despite this, the company significantly improved its operating result, with a reported operating loss of PLN 1.7 million, compared to a loss of PLN 5.1 million in Q2.
“Thanks to the revenue streams we are developing and the launch of financing from BioFund, we have the flexibility to execute our strategy, both in terms of increasing sales and technology development,” added Maciej Gamrot.
The global market (excluding the U.S.) continued to generate higher revenues than the U.S. market, with PLN 4.0 million in revenue compared to PLN 1.2 million. In line with the company’s current strategy, Medicalgorithmics focuses on selling high-margin diagnostic software, with device sales offered only as an optional service to clients.
“Medicalgorithmics has already rebuilt 53% of its U.S. revenue, which is a great success considering that in January of this year, we had zero revenue from this market after the end of our partnership with React in Q4 2023. We are now working intensively on expanding service sales in this market and acquiring new partners, with whom we are working on a non-exclusive basis. As a result of these efforts, we have achieved a 24% quarter-on-quarter increase and the launch of five new IDTFs,” added Maciej Gamrot.
During the reporting period, the WSE-listed medtech company performed 72,400 sessions for its clients, marking a 2.5% increase compared to Q2 2024 (70,600 sessions). This figure has grown for four consecutive quarters. Year-over-year, compared to Q3 2023, the number of sessions increased 2.2 times.
As part of the development strategy announced in June 2023, created with the participation of Medicalgorithmics’ main shareholder, BioFund Capital Management LLC, the company has changed its business model. It has shifted away from offering a closed cardiac diagnostic system tied to its own heart monitoring devices. In the new strategy, the company focuses on selling a platform for multi-day ECG analysis with proprietary AI algorithms as a standalone product, as well as integrating with partners’ devices and IT systems. Medicalgorithmics’ software can be licensed by clients, and the company will receive fees in various models, including one based on the number of ECG data analyses performed.