Breaking Down PROCEPT BioRobotics Corporation (PRCT) Financial Health: Key Insights for Investors

You're looking at PROCEPT BioRobotics Corporation (PRCT) and trying to map the path from explosive growth to profitability, and honestly, the Q3 2025 numbers give us a clear, defintely mixed picture. The top-line momentum is undeniable: the company is on track to hit its full-year 2025 revenue guidance of approximately $325.5 million, representing a robust 45% growth over the prior year. That's driven by strong adoption, pushing the U.S. installed base to 653 systems as of September 30, 2025. But, you still have to fund that expansion, so the full-year Adjusted EBITDA loss is projected to be around ($35.0) million, even with a solid gross margin expected between 64.0% and 64.5%. The good news is the balance sheet is healthy, holding approximately $297.3 million in cash and equivalents. The question isn't if they're growing, but when the unit economics flip the loss into a gain, especially with 2026 revenue guidance already set high at $410 million to $430 million.

Revenue Analysis

You need a clear picture of where PROCEPT BioRobotics Corporation (PRCT) is actually making its money, and the answer is increasingly in the recurring revenue stream. The company is on track for a strong 2025, projecting full-year total revenue of approximately $325.5 million, representing a significant year-over-year growth of about 45% compared to 2024.

This growth isn't just from selling new capital equipment; it's a direct result of the expanding installed base of their AquaBeam and HYDROS Robotic Systems. The company's strategy is working: place the system, then drive utilization of the single-use components. This is defintely the most important trend to watch.

Breakdown of Primary Revenue Sources (Q3 2025)

The third quarter of 2025 saw total revenue hit $83.3 million, a 43% jump from the prior year period. The revenue mix shows a healthy reliance on high-margin, recurring consumables, which is the hallmark of a successful medical device business model. Here's the quick math on the Q3 split, which is a good proxy for the full year:

• U.S. Handpiece and Consumables: This is the largest segment, bringing in $44.4 million. This revenue stream grew by a massive 50% year-over-year, showing that procedures using the Aquablation therapy are accelerating.
• U.S. System and Rental: Revenue from selling the robotic systems themselves was $24.7 million, up 26% year-over-year. This segment is the foundation, but the consumables are the real engine.
• International: This region is small but fast-growing, contributing $9.4 million and growing at an impressive 53% year-over-year.

To be fair, the U.S. market is still the primary driver, accounting for $73.9 million of the Q3 total, a 42% increase year-over-year.

Segment Contribution and Growth Trends

The shift toward consumables is a significant change, translating into a more predictable, high-margin revenue base. For Q3 2025, Handpiece and Consumables revenue made up over 53% of total revenue, a clear majority. The U.S. installed base reached 653 systems by the end of September 2025, which directly fuels that consumable revenue. What this estimate hides is the utilization rate per system, which is the next lever for the company to pull.

The company's focus on expanding its commercial organization and driving patient activation is clearly paying off in the consumable sales. The international market, while only about 11% of total revenue, is demonstrating the highest growth rate at 53%, which suggests strong early adoption in new geographies. You can read a more detailed financial health analysis at Breaking Down PROCEPT BioRobotics Corporation (PRCT) Financial Health: Key Insights for Investors.

Here is a summary of the Q3 2025 revenue performance by segment:

Finance: Monitor the ratio of handpiece/consumable revenue to system revenue quarterly to confirm the recurring revenue model's continued acceleration.

Profitability Metrics

You're looking at PROCEPT BioRobotics Corporation (PRCT) and wondering if the rapid revenue growth translates to a viable business model. The direct takeaway is this: the company is executing a strong gross margin expansion plan, but it remains heavily in an investment phase, so the operating and net margins are still deeply negative. You are investing in future scale, not present-day profit.

For the full 2025 fiscal year, PROCEPT BioRobotics Corporation (PRCT) is guiding for total revenue of approximately $325.5 million, representing a strong 45% growth over the prior year. This top-line momentum is excellent, but the profitability picture is a classic high-growth medical device story: high gross margins offset by massive commercial and research and development (R&D) spending.

Here's the quick math on the expected 2025 profitability based on company guidance:

• Gross Margin: Expected to be in the range of 64.0% to 64.5% for the full year. This is a high-quality margin, reflecting the value and efficiency of their Aquablation® and HYDROS® systems.
• Operating Margin: With expected total operating expenses of approximately $302.0 million, and a calculated Gross Profit of roughly $210.1 million (based on the 64.5% margin), the operating loss is projected to be around ($91.9 million). This translates to an operating margin of roughly -28.2%.
• Net Profit Margin: The company reported a net loss of $21.4 million for the third quarter of 2025 alone. This indicates a net profit margin deep in the negative territory, reflecting the operating loss plus interest, taxes, depreciation, amortization, and stock-based compensation (which are excluded from the Adjusted EBITDA loss of approximately ($35.0) million expected for the full year).

What this estimate hides is the strategic investment. The operating expenses are high because they are aggressively expanding their commercial organization and R&D to drive future adoption and new product development, like the HYDROS Robotic System. The operating loss is a choice, not a failure.

The trend is the most compelling part of the story. PROCEPT BioRobotics Corporation (PRCT) is showing a clear path to margin expansion, defintely in the gross profit line. The gross margin expanded to 64.8% in Q3 2025, up from 63% in the prior year period, driven by improved operational efficiencies and better overhead absorption. This is a crucial sign of a scalable business model; the cost of goods sold is growing slower than revenue, which is what you want to see.

To be fair, the company is still a significant outlier compared to industry peers. The average net profit margin for the US Medical Equipment industry is around 12.5%. PROCEPT BioRobotics Corporation (PRCT)'s net margin is currently around -30.6%, a stark difference. However, analysts forecast a major turnaround, projecting earnings growth of 71.13% per year and anticipating profitability within the next three years, driven by expanded reimbursement and increased adoption of Aquablation therapy. This is a high-risk, high-reward profile.

Here is a summary of the key profitability ratios, which clearly maps the company's current stage:

The action here is to monitor the operating expense line closely. The goal is for revenue growth to eventually outpace the growth in operating expenses, leading to positive operating leverage. For more context on who is betting on this turnaround, you should read Exploring PROCEPT BioRobotics Corporation (PRCT) Investor Profile: Who's Buying and Why?

Debt vs. Equity Structure

You're looking at PROCEPT BioRobotics Corporation (PRCT) and want to know how they're fueling their rapid growth-is it mostly debt or equity? The short answer is they are leaning heavily on equity, which is common for a high-growth, pre-profit medical device company, but they still have a manageable debt facility in place.

As of the third quarter of 2025, PROCEPT BioRobotics Corporation's balance sheet shows a very conservative approach to borrowing. Their total long-term debt, primarily from a term loan facility, stands at approximately $51.6 million. This debt is dwarfed by their total shareholder equity, which was about $380.3 million. That's a strong position.

Here's the quick math on their capital structure:

• Total Long-Term Debt: Approximately $51.6 million
• Total Shareholder Equity: Approximately $380.3 million
• Debt-to-Equity Ratio: Roughly 0.14

A debt-to-equity (D/E) ratio of 0.14 (or 14%) is exceptionally low, especially in the capital-intensive medical technology industry where a D/E ratio closer to 0.5 or 1.0 is often considered standard and healthy for growth. This low ratio tells us the company is funding its expansion-like increasing its U.S. installed base to 653 robotic systems as of Q3 2025-mostly through shareholder capital and retained earnings (or accumulated deficit, in this case, given their current loss-making status) rather than borrowing.

The company recently made a key change to its debt structure. In August 2025, PROCEPT BioRobotics Corporation amended its existing Term Loan Facility, which had an aggregate principal amount of $52.0 million. The big takeaway here is that they modified the repayment terms to defer the entire principal payment until the maturity date in October 2027, replacing a previous schedule that required monthly principal amortization payments. This action defintely frees up near-term operating cash flow to invest directly back into the business, like expanding their commercial organization and R&D, which drove operating expenses to $77.2 million in Q3 2025.

When you look at how they balance debt versus equity, the preference for equity funding is clear. The company has a significant cash position, with cash and equivalents totaling around $297.3 million as of September 30, 2025. They are also actively using the equity markets; for example, a Follow-on Equity Offering in the amount of $175 million was filed in October 2025. This shows a strategic choice to raise non-dilutive debt only for a small portion of their capital needs, while tapping the equity market for the large-scale capital required to fund their aggressive growth strategy, which projects full-year 2025 revenue of approximately $325.5 million. They are prioritizing flexibility and a clean balance sheet over the interest expense trade-off. For more on their long-term vision, see the Mission Statement, Vision, & Core Values of PROCEPT BioRobotics Corporation (PRCT).

To summarize PROCEPT BioRobotics Corporation's financing mix:

Liquidity and Solvency

You need to know if PROCEPT BioRobotics Corporation (PRCT) has the cash to manage its rapid growth and cover near-term bills. The short answer is yes, they have a massive cash cushion, but the underlying operations still burn cash. This is a classic growth-stock profile: high liquidity, but a reliance on external funding or existing reserves.

As of the third quarter of 2025, PROCEPT BioRobotics' liquidity position is defintely strong. Their Current Ratio sits at approximately 8.44, and the Quick Ratio is around 7.20 [cite: 3, 7 in step 1]. For context, a ratio above 1.0 is considered healthy, so these figures are exceptional. This means the company has $8.44 in current assets for every dollar of current liabilities, indicating a robust ability to meet all short-term obligations without stress.

Here's the quick math on their Q3 2025 working capital (current assets minus current liabilities):

• Total Current Assets: $454.75 million [cite: 10 in step 1]
• Total Current Liabilities: $53.90 million [cite: 10 in step 1]
• Working Capital: $400.85 million

The trend in working capital is a key insight. The massive $400.85 million figure is driven by a large cash balance of nearly $297.3 million [cite: 1, 4 in step 1] and an inventory build-up of $66.72 million [cite: 10 in step 1]. This inventory increase, while necessary to support the expanding U.S. installed base of 653 systems [cite: 1, 4 in step 1], has been a drag on the Free Cash Flow (FCF), which is why we see a negative FCF yield of -4.58% [cite: 2 in step 1]. What this estimate hides is the operational cost of scaling.

Looking at the cash flow statement for the nine months ended September 30, 2025, the picture is clear on where the cash is going:

The core liquidity concern isn't immediate survival, but the cash burn from operations. PROCEPT BioRobotics used $38.66 million in cash from operations over the first nine months of 2025. This operational cash outflow is a direct result of the company's aggressive commercial expansion and R&D spending, which is necessary to hit their full-year 2025 revenue guidance of approximately $325.5 million [cite: 1, 5 in step 1]. The company's strength lies in its strong balance sheet, not yet in self-funding operations. You can read more about their long-term growth strategy in their Mission Statement, Vision, & Core Values of PROCEPT BioRobotics Corporation (PRCT).

The key takeaway here is that the company has a substantial war chest to fund its path to profitability, but you must monitor the quarterly cash burn rate. If the net cash used in operating activities doesn't start to narrow as revenue scales, those high liquidity ratios will eventually begin to erode. For now, the strong cash position mitigates any near-term liquidity risk.

Valuation Analysis

You're looking at PROCEPT BioRobotics Corporation (PRCT) and wondering if the market has it right, especially with that recent stock price drop. Honestly, the valuation picture is mixed, which is common for high-growth, pre-profit medical device companies. The short answer is that, based on traditional metrics, the stock looks expensive or is simply unquantifiable, but analysts see a deep discount against future growth.

The stock is currently trading around the $28.40 mark as of mid-November 2025, a steep decline from its 52-week high of $100.89. That's a brutal 67.30% drop over the last year, putting it near its 52-week low. Here's the quick math on why traditional valuation ratios don't work yet.

Is PROCEPT BioRobotics Corporation (PRCT) Overvalued or Undervalued?

The company is not yet profitable, so standard earnings multiples are distorted. They are still in the heavy investment phase, focusing on expanding their installed base of the AquaBeam Robotic System. You have to look at sales and book value to get a clearer, though still high-level, view.

• Price-to-Earnings (P/E) Ratio: This is a non-starter. Because PROCEPT BioRobotics Corporation (PRCT) is reporting a net loss-with a consensus FY2025 Earnings Per Share (EPS) estimate of ($1.75)-the P/E ratio is negative or simply 'not applicable'. A negative P/E tells you nothing about value, only that the company is losing money.
• Price-to-Book (P/B) Ratio: At approximately 4.10 to 4.27, the P/B ratio is high. This signals that investors are willing to pay over four times the company's net asset value. This premium reflects the market's expectation of significant future earnings from their technology, not its current balance sheet strength.
• Enterprise Value-to-EBITDA (EV/EBITDA): The Trailing Twelve Months (TTM) EV/EBITDA is around -15.18. Since the company's full-year 2025 Adjusted EBITDA loss is projected to be approximately ($35.0) million, this ratio is also negative. What this estimate hides is the enormous top-line growth, which is the real story here: full-year 2025 revenue is guided at approximately $325.5 million, a 45% jump from 2024.

The company does not pay a dividend, so the dividend yield and payout ratio are 0.00%. This is expected; every dollar of cash is being reinvested to fuel that 45% revenue growth.

Analyst Consensus and Price Targets

Despite the stock's recent performance, Wall Street remains defintely optimistic. The consensus analyst rating is a Moderate Buy. Out of the analysts covering the stock, a strong majority-90.00%-rate it a Buy, with the remaining 10.00% at a Hold. Nobody is calling for a Sell right now.

The average 12-month price target is approximately $54.57. That target suggests a potential upside of over 90% from the current price. The analysts are clearly valuing the company on its future potential, betting that the strong revenue growth will eventually translate into operating leverage and profitability within the next few years. You can read more about the long-term vision in their Mission Statement, Vision, & Core Values of PROCEPT BioRobotics Corporation (PRCT).

The disconnect is clear: the stock price reflects near-term execution and macro risks, while the analyst targets reflect the long-term potential of the Aquablation therapy market. Your action here is to decide which timeline matters more to your portfolio.

Risk Factors

You need to be a trend-aware realist when looking at a high-growth medical device company like PROCEPT BioRobotics Corporation (PRCT). The robust revenue growth-projected at approximately $325.5 million for the full year 2025, a 45% jump-is fantastic, but it masks some deep, near-term financial and operational risks. My job is to map those risks to clear actions, so here's the defintely unvarnished view.

The core challenge is balancing aggressive market expansion with the path to profitability. This is a classic growth-stage dilemma, and it's the most immediate risk to your investment thesis.

Financial and Operational Headwinds

The primary internal risk is the continued operating loss. For the nine months ended September 30, 2025, PROCEPT BioRobotics Corporation (PRCT) reported a net loss of $65.7 million. While this is an improvement over the prior year, it shows the massive cash burn required to fuel their expansion. The company expects a full-year 2025 Adjusted EBITDA loss of approximately ($35.0) million.

Here's the quick math: they are spending heavily to grow the commercial organization and expand research and development (R&D). Full year 2025 total operating expenses are expected to be around $302.0 million. This is why, despite a strong gross margin in the 64.0% to 64.5% range, they are still losing money. Cash is king, and while they have a strong cash balance of about $297.3 million as of September 30, 2025, it's a finite resource funding these losses. They are still a growth story, not a profit story.

Operational execution is another key risk. The company has noted variability in the time it takes from a system sale to the first procedure, which delays the revenue realization from their high-margin disposable handpieces. Also, tariff-related costs are expected to create a gross margin headwind of approximately $2.0 million in the fourth quarter of 2025.

External and Competitive Pressures

The external risks center on competition and the regulatory landscape. The company's success is heavily reliant on the adoption of its core technology, the AquaBeam/HYDROS Robotic System, for Benign Prostatic Hyperplasia (BPH). This product concentration leaves them vulnerable.

• Competition: The market for robotic surgery is fierce. While Aquablation is a unique technology, a more advanced or cost-effective rival could emerge quickly and threaten their growth trajectory. For example, the prostate cancer market they hope to enter by early 2028 is currently dominated by Intuitive Surgical's Da Vinci Surgical System.
• Regulatory & Reimbursement Changes: Shifts in healthcare policy and reimbursement rates, including potential cuts to urology physician fees, can directly slow procedure adoption. This is a constant, unpredictable headwind in the medical device space.

You have to accept that a single-platform focus in a competitive medical technology space is inherently risky.

Mitigation and Actionable Plans

The good news is that management is not ignoring these risks; they are taking concrete steps to mitigate them. This is where you focus your attention-on the execution of these plans.

To address the operational risk of slow new account launches, PROCEPT BioRobotics Corporation (PRCT) has launched an initiative to accelerate the time from system sale to the first procedure. This is crucial because their razor-and-blade business model depends on the high-margin handpiece sales that follow system installation. They are also building out a marketing organization to increase patient awareness and drive utilization.

On the supply chain front, they proactively de-risked by sourcing the majority of strategic components in the US and maintaining significant inventory for non-US parts to avoid major disruptions. Strategically, they are focused on expanding the use of their technology beyond BPH, with commercialization for prostate cancer treatment anticipated by early 2028. This indication expansion is their long-game play to diversify revenue and reduce platform reliance. You can read a deeper dive into the company's overall performance and strategy here: Breaking Down PROCEPT BioRobotics Corporation (PRCT) Financial Health: Key Insights for Investors.

Growth Opportunities

You're looking at PROCEPT BioRobotics Corporation (PRCT) and seeing impressive revenue growth, but still a loss on the bottom line. That's the classic high-growth med-tech story, and the key is understanding the drivers that will flip that loss into a profit. The company's future isn't just about selling more AquaBeam Robotic Systems; it's about the recurring revenue from the disposables and unlocking new markets.

For the full year 2025, the company projects total revenue of approximately $325.5 million, a significant jump representing about 45% growth over the prior year. This momentum is directly tied to the razor-and-blade business model-selling the capital equipment (the razor) and the high-margin disposable handpieces (the blades). The consensus earnings per share (EPS) estimate for December 2025 is still a loss at -$1.49, but the path to profitability is clear: drive utilization of the installed systems.

Here's the quick math on the core growth engine:

• System Sales: Expected to sell approximately 213 new robotic systems in the U.S. in 2025.
• Handpiece Sales: Forecasted at approximately 52,000 units in 2025, a unit volume increase of about 61% compared to 2024.
• Gross Margin: Expected to land between 64.0% and 64.5% for the full year 2025, showing improving operational efficiency.

What this estimate hides is the power of the installed base, which reached 653 systems in the U.S. as of September 30, 2025. The more systems out there, the more those high-margin handpieces get used. That's the defintely long-term value driver.

Product innovation is also pushing growth. The newer HYDROS Robotic System is a key driver, which is their AI-Powered platform. About 95% of users are leveraging its FirstAssist AI feature, which improves efficiency and utilization in hospital settings. Plus, international expansion is accelerating, with international revenue surging 69% year-over-year in Q2 2025, though it remains a smaller part of the total revenue.

The biggest strategic initiative is market expansion beyond Benign Prostatic Hyperplasia (BPH). The company is actively progressing its prostate cancer treatment (WATER IV study) and is targeting commercialization for early 2028. That's a massive, multi-billion-dollar market that could fundamentally change the company's valuation. They are also focused on securing strategic partnerships with Integrated Delivery Networks (IDNs) to lock in bulk purchase orders and make sales more predictable. The core competitive advantage remains the unique Aquablation therapy-it's minimally invasive, size-independent for BPH treatment, and has a low rate of irreversible complications, particularly sexual dysfunction, which is a huge differentiator against traditional surgical options.

To learn more about the broader financial picture, you can read the full analysis at Breaking Down PROCEPT BioRobotics Corporation (PRCT) Financial Health: Key Insights for Investors.