Xtant Medical (NYSEAMERICAN:XTNT) reported second-quarter 2026 revenue of $23 million, down from $35.4 million a year earlier, as the company navigated difficult comparisons following the sale of certain assets and businesses to Companion Spine and the loss of license revenue tied to reimbursement changes.
On a pro forma basis excluding revenue from divested non-core products and businesses and non-recurring license revenue, second-quarter 2025 revenue was $24.8 million. Chief Financial Officer Scott Neils said the year-over-year decline versus that pro forma figure was driven primarily by lower amnio product revenue associated with the advanced wound care market.
Dilon integration and HEMOBLAST revenue recognition
Xtant said it made progress integrating the commercial team obtained through its April distribution agreement with Dilon Technologies. The agreement gave Xtant exclusive U.S. distribution rights for HEMOBLAST Bellows, a hemostatic product, and added 17 sales representatives and two regional managers to its organization.
Browne said the company spent much of the quarter integrating the new employees, training them and expanding the products they can sell. He said the integration work consumed substantial time and resources and contributed to softer second-quarter sales, but described the expanded commercial organization as a key component of Xtant’s long-term strategy.
The new representatives initially received Xtant’s CollagenX and amnio products in their sales bags, Browne said. After June, the company began providing the broader orthobiologics portfolio and assigning some lower-coverage independent-agent accounts to the specialty sales team.
HEMOBLAST orders were in line with management’s expectations, according to Browne, but reported revenue was lower than anticipated because purchase orders were not transitioned to Xtant until after the quarter ended and customer contract transitions remain in progress.
Neils said Xtant recognized about $1.5 million of HEMOBLAST revenue in the second quarter, primarily on a net basis because products were shipped directly from Dilon’s facility under Dilon customer agreements. Xtant had expected a greater proportion of transactions to be ordered and shipped through its own operations, which would have increased reported quarterly revenue by approximately $600,000 to $700,000.
Looking ahead, Neils said the company expects substantially all HEMOBLAST Bellows sales to be processed through Xtant customer agreements and its distribution network, allowing revenue to be recognized on a gross basis. Management said it has not reduced its expectation for HEMOBLAST transaction volume of more than $1 million per month on a gross basis, though the amount recognized will depend on the pace of customer transitions.
Product launches and biologics outlook
Xtant launched Trivium Shaped in May and said the bone-graft product is showing early sales traction. The product extends the company’s Trivium portfolio with pre-shaped graft forms, including boats and strips, intended to support handling and placement in surgical applications.
Browne said Trivium Shaped, along with CollagenX and OsteoFactor Pro, is expected to contribute to biologics growth. He also said Xtant sees potential to expand into chronic wound care and surgical repair markets through its demineralized bone matrix, amnio and CollagenX offerings.
However, management identified weakness in several areas of the orthobiologics business. In response to an analyst question, Browne said older product lines including OsteoSelect, OsteoSponge and 3Demin had declined more than expected. Amnio products also remained under pressure, and the company had expected to see more signs of recovery in that market.
Management said it expects product introductions and investments in regional sales representatives and national accounts personnel to support sequentially improving biologics growth during the remainder of 2026.
Margins, expenses and balance sheet
Second-quarter gross margin was 57.9%, compared with 68.6% a year earlier. Neils attributed the decline primarily to the end of Q-Code license revenue from amniotic membrane agreements, along with lower production efficiencies and higher excess-and-obsolete inventory charges. Improvements in production mix partly offset those factors.
- Operating expenses were $22.5 million, compared with $19.7 million in the prior-year quarter.
- The increase included a $5 million exclusivity fee paid to Dilon under the distribution agreement.
- General and administrative expense declined to $6.4 million from $7.5 million.
- Sales and marketing expense declined to $10.4 million from $11.6 million, though higher compensation, commissions and travel costs partly offset savings from the Companion Spine divestitures.
- Research and development expense rose to $695,000 from $566,000.
Xtant reported a net loss of $9.4 million, or $0.07 per basic and diluted share, compared with net income of $3.6 million in the prior-year quarter. Adjusted EBITDA was a loss of $2.7 million, compared with positive adjusted EBITDA of about $6.9 million a year earlier.
As of June 30, Xtant had $9.9 million in cash and cash equivalents, total indebtedness of $23 million and $0.7 million available under its revolving credit facility. At the end of 2025, the company had $17.3 million in cash and cash equivalents, $25.4 million of indebtedness and $3.8 million of revolver availability.
About Xtant Medical (NYSEAMERICAN:XTNT)
Xtant Medical, Inc is a medical technology company focused on the development, manufacturing and distribution of bone graft, spine biologics and related implantable medical devices. The company’s product portfolio is designed to address critical needs in spinal fusion, orthopedics and trauma surgery by providing a range of solutions that promote bone growth, structural support and patient recovery.
The company’s offerings include an array of bone graft substitutes – such as demineralized bone matrix putties and fibers – interbody fusion devices, spinal fixation systems and biologic agents.
