Avita Medical shares drop after full-year guidance slashed
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The news: ASX- and Nasdaq-listed Medical technology company Avita has lowered its full-year commercial revenue guidance after a posting lower than expected sales in the first-half of 2025.
The numbers: Shares in Avita Medical trading on the ASX had slipped 11% to $1.54 by 10:53am AEST.
Avita reported Q2 revenue of USD18.4 million ($28.3 million), roughly in line with the preceding quarter revenue of USD18.5 million.
However, first-half revenue for 2025 was USD5 million lower than the second half of 2024.
The company lowered its commercial revenue guidance range from between USD100 million and USD106 million to between USD76 million and USD81 million.
The context: Avita said that demand for its RECELL burn wound and skin defect treatment was constrained by a provider reimbursement issue stemming from a rule change by the US Centers for Medicare and Medicaid Services.
Avita said that following the rule change claims were not processed in a timely manner creating "a significant backlog of unpaid claims and inadequately paid claims to providers of RECELL procedures".
What they said: "This lack of resolution created uncertainty among providers created uncertainty among providers regarding payment expectations and timelines, which led to a reduction in RECELL utilisation during the first half of the year," the company said in a statement to the exchange.
The source: ASX
