RxSight (RXST) Q2 Loss Beats Estimates

Key Points

• Non-GAAP loss per share of $0.08 in Q2 2025 significantly exceeded expectations, despite GAAP revenue coming in below estimates.

• GAAP gross margin was 74.9%, boosted by a stronger mix of high-margin consumable sales, while total GAAP revenue fell 4% year-over-year.

• Light Delivery Device system sales dropped 49% year-over-year, while Light Adjustable Lens procedure volume grew 13% year-over-year.

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RxSight (NASDAQ:RXST), a U.S.-based ophthalmic medical device company, reported its second quarter 2025 financial results on August 7, 2025. The most notable developments in the release were a lower-than-expected GAAP revenue outcome alongside a marked improvement in profitability metrics, with GAAP gross margin rising from 69.5% in Q2 2024 to 74.9% in Q2 2025. GAAP revenue was $33.6 million, missing analyst estimates of $34.79 million and down from $34.9 million in Q2 2024. Despite this, Non-GAAP adjusted net loss per share was $(0.08), materially outperforming the $(0.25) consensus non-GAAP EPS estimate. This quarter saw a 13% increase in Light Adjustable Lens procedures compared to Q2 2024, improved GAAP gross margin to 74.9% from 69.5% in Q2 2024, but also wider operating losses driven by rising expenses. Overall, the period underscores the progress in high-margin consumable sales, as well as the challenges in capital system placements and expense control.

Source: Analyst estimates provided by FactSet. Management expectations based on management's guidance, as provided in Q2 2025 earnings report.

Business Overview and Key Focus Areas

RxSight is a medical device company specializing in innovative intraocular lens technologies. Its primary offering is the Light Adjustable Lens (LAL), which enables surgeons to customize a patient’s vision after cataract surgery through a series of painless UV light treatments. The associated Light Delivery Device (LDD) provides physicians the tool necessary for lens adjustment, creating a unique value proposition in the premium cataract lens market. This differentiated approach allows patients to achieve superior visual outcomes, as shown by Clinical trial data from the FDA trial indicate that 70% of LAL patients achieved 20/20 or better uncorrected visual acuity without glasses, compared to about 40% of patients with standard premium lenses in similar studies.

The company’s strategy focuses on expanding the installed base of LDD systems and increasing the utilization of LALs in ophthalmic practices. Its continued R&D investments target enhancements to lens technology and expanding lens adjustability. Regulatory compliance, product innovation, and growing the customer base are critical success factors, particularly in a competitive field dominated by larger, established firms.

Second Quarter Highlights and Performance Drivers

In the quarter, RxSight’s total GAAP revenue declined 4% year-over-year, as a significant decrease in capital equipment (LDD) sales offset growth in recurring LAL consumable sales. GAAP revenue missed analyst expectations by about $1.2 million. Light Adjustable Lens unit sales rose 13% year-over-year, reaching 27,380 units, showing the continued adoption of the company’s core lens consumable. At the same time, This drop in new LDD placements impacted upfront revenue growth.

The installed base of LDDs, representing the number of eye care practices able to offer the adjustment procedure, grew to 1,084 locations as of Q2 2025. This represents a 34% increase from a year earlier. Management continued to emphasize engagement with the installed user base and launched a Customer Success Organization to help practices ramp up utilization. International expansion continued with entry into South Korea and Singapore in July, broadening its addressable market.

GAAP gross profit increased to $25.2 million, up from $24.3 million in Q2 2024, despite lower total GAAP revenue. GAAP gross margin improved to 74.9%, up from 69.5% in Q2 2024. The company attributed this gain to a higher mix of high-margin LAL consumable sales versus lower-margin capital equipment. According to management, “The increase in gross profit was primarily driven by the favorable shift in product mix toward LAL sales.”

Operating expenses continued their upward trend, increasing 20% to $39.2 million, split between selling, general, and administrative costs of $28,976,000 and research and development expenses of $10.2 million. GAAP net loss widened to $11.8 million, up from $6.1 million in Q2 2024. Both research investment and commercial spending were cited as factors driving expense growth. The management team has maintained higher investment levels to support growth initiatives and R&D, but with persistent losses, cost management has become a key area to watch.

Product Portfolio and Industry Context

The Light Adjustable Lens family comprises intraocular lenses that surgeons can adjust after cataract surgery by exposing the lens to ultraviolet light using the Light Delivery Device. This technology is FDA-approved and aims to optimize vision for patients who may otherwise be left with less-than-ideal results from fixed-power lenses.

The company continues to press its technological advantage. Updates to the LDD’s software also gained regulatory clearance, supporting new clinical and workflow features. These developments enhance RxSight’s competitive differentiation, important in a market dominated by Alcon and Johnson & Johnson, which control about 75% of the U.S. premium cataract surgery market.

Outlook and Guidance

Management reiterated its full-year 2025 guidance, forecasting annual revenue of $120.0 million to $130.0 million, which equates to a decline of 7% to 14% versus the prior year. GAAP gross margin is projected to fall between 72% and 74% for FY2025, reflecting continued emphasis on high-margin lens consumable sales. Operating expenses are expected to range from $145.0 million to $155.0 million for FY2025, with $27.0 million to $30.0 million of that from non-cash stock-based compensation. This guidance was unchanged despite the GAAP revenue shortfall.

The company ended the quarter with $227.5 million in cash, cash equivalents, and short-term investments, with a net cash use of $1.8 million. Looking ahead, investors should monitor the pace of new LDD installations, procedure growth per account, and the trajectory of operating expenses relative to gross profit. No additional outlook or guidance was offered beyond the updated 2025 forecast.

Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.

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