Breaking Down Zynex, Inc. (ZYXI) Financial Health: Key Insights for Investors

If you are looking at Zynex, Inc. (ZYXI) right now, you need to understand one thing: the financial picture has fundamentally changed, and quickly. The third quarter of 2025 was brutal, with net revenue collapsing to just $13.4 million, a massive drop from $50.0 million in the prior-year quarter, largely due to the Tricare payment suspension and payer issues. This revenue shock, plus a non-cash asset impairment charge of $30.7 million, drove the company to a net loss of ($42.9) million for the quarter. Honestly, that's a serious red flag.

You're not just looking at a bad quarter; you're looking at a liquidity crunch, evidenced by the company electing a 30-day grace period instead of making a $1.5 million interest payment on its $60 million Convertible Notes, which mature in May 2026. Still, new management is in place, focused on compliance and restructuring, and they ended the quarter with $13.3 million in cash. So, the question isn't just about the past loss-it's about whether their new compliance-focused strategy can reverse the 73% revenue decline and cure the debt issue before the clock runs out. We need to dig into the details and map out the next 12 months.

Revenue Analysis

You need to know where Zynex, Inc. (ZYXI) makes its money, especially now, because the revenue picture has changed dramatically in 2025. The direct takeaway is this: Zynex's revenue is currently in a steep decline, driven almost entirely by payer-related issues, not a lack of product demand. To be fair, the Q3 2025 net revenue of just $13.4 million is a major flashing red light for investors.

Here's the quick math on the near-term trend: the company's trailing twelve months (TTM) revenue ending September 30, 2025, was approximately $108.20 million, which represents a massive year-over-year decline of -44.13%. This is a sharp reversal from 2024, when Zynex still posted annual revenue of $192.35 million with a modest 4.36% growth. You simply cannot ignore that kind of drop-off.

The Core Revenue Streams

Zynex, Inc.'s revenue primarily flows from its Pain Management division, which focuses on non-invasive medical devices like the NexWave device (a TENS and NMES unit) and the corresponding consumable supplies. The company's revenue is fundamentally split between the initial device sale (or rental) and the recurring revenue from the supplies, which is a key part of its business model. In Q3 2025, this split looked like this:

• Device Revenue: $7.1 million
• Supplies Revenue: $6.3 million

The Supplies segment typically provides a higher-margin, predictable stream, so the fact that both categories are depressed shows a systemic problem affecting the entire sales cycle-from new patient onboarding to resupply orders. The Monitoring Solutions division, which includes the NiCO laser-based pulse oximeter, has yet to become a meaningful revenue contributor, though it is a future focus for the company's Mission Statement, Vision, & Core Values of Zynex, Inc. (ZYXI).

Analyzing the Revenue Shock

The significant change in Zynex, Inc.'s revenue stream is not a market shift but a direct, acute operational and compliance challenge. The Q3 2025 net revenue of $13.4 million is a shocking -73.26% decrease compared to the $50.0 million reported in Q3 2024. This is defintely a crisis point.

The core issue is the TRICARE payment suspension. This is the payer for U.S. military personnel and their families, and it previously accounted for about 20-25% of Zynex's annual revenue. The suspension, combined with a $2.8 million revenue reduction related to payments received during the suspension, has cratered the top line. Plus, general changes in other payers' claim submission and review practices are causing denials and payment delays, which adds to the volatility.

Here is a snapshot of the revenue volatility and its cause:

The company also implemented workforce reductions in Q1 and Q2 2025 in response to earlier revenue and order slowing, which then compounded the problem by negatively impacting device orders and new patient onboarding, creating a nasty feedback loop. This is a critical risk: cost-cutting that hurts the sales engine makes a turnaround much harder.

Profitability Metrics

You need a clear picture of Zynex, Inc.'s (ZYXI) core financial health, and honestly, the Q3 2025 results show a company under severe strain. The direct takeaway is that a sharp decline in revenue, driven by the Tricare payment suspension, has completely inverted Zynex, Inc.'s profitability, pushing all key margins deep into negative territory. You are defintely looking at a restructuring story now, not a growth one.

Here's the quick math on the most recent quarter, which ended September 30, 2025. This shows the dramatic shift in operational efficiency (or lack thereof) when a major revenue stream is suddenly cut. For comparison, the median Gross Margin for the Surgical and Medical Instruments and Apparatus industry in 2024 was around 61.6%, and the median Operating Margin was a negative -26.8%.

Operating Profit/Margin for Q3 2025 is calculated as Gross Profit ($8.1M) minus Sales & Marketing ($9.5M) and G&A ($11.8M), totaling an operating loss of ($13.2M) on $13.4M in revenue.

Trends in Profitability and Operational Efficiency

The most alarming trend is the rapid deterioration throughout 2025. Gross Profit Margin dropped from 69% in Q1 2025 to 68% in Q2 2025, and then to 60% in Q3 2025. This compression is a red flag, as it shows that not only is revenue falling, but the cost of goods sold (COGS) is not decreasing proportionally. The Q3 2025 gross margin of 60% is just below the industry median of 61.6%, indicating a loss of competitive cost advantage.

The operational loss of ($13.2) million in Q3 2025, which translates to a shocking -98.5% Operating Profit Margin, is far worse than the industry median of -26.8%. This huge discrepancy highlights that Zynex, Inc.'s fixed operating costs-like sales and marketing, and general and administrative expenses-are too high for the current revenue base. The company is spending nearly a dollar in operating expenses for every dollar of revenue just to cover costs, before even factoring in the cost of the product itself.

Cost Management and Near-Term Actions

To be fair, management is acting on costs. They implemented a staff reduction of approximately 15% in Q1 2025, which they expect will result in annualized savings of around $35 million to $40 million. This is a necessary, painful step to align the cost structure with the new, lower revenue reality. You can see this reflected in a 54% year-over-year decrease in Sales and Marketing expense to $9.5 million in Q3 2025. Still, the revenue drop from $50.0 million to $13.4 million year-over-year in Q3 was so severe that cost cuts haven't been enough to restore operational profitability. What this estimate hides is the one-time, non-cash impairment charge of $30.7 million recorded in Q3 2025 related to goodwill and assets, which drove the Net Loss to ($42.9) million. That is a significant write-down that signals a permanent reduction in the value of previous investments.

For a deeper dive into the balance sheet and liquidity issues, you can check out the full post at Breaking Down Zynex, Inc. (ZYXI) Financial Health: Key Insights for Investors.

• Watch for Q4 2025 results to see if cost cuts stabilize the operating margin.
• Monitor the status of the Tricare payment suspension appeal.
• Track the new management team's restructuring progress.

Finance: Model a best-case and worst-case Q4 2025 Operating Margin scenario by the end of the month.

Debt vs. Equity Structure

You're looking at Zynex, Inc.'s (ZYXI) balance sheet, and the first thing that hits you is the stark reality of its financing mix. The company is currently in a highly distressed financial position, relying almost entirely on liabilities, with its equity cushion completely eroded. This is a classic high-risk capital structure.

As of the third quarter of 2025, ended September 30, Zynex, Inc. reported total liabilities of over $86.694 million (in thousands) against a total stockholders' equity deficit of ($41.372 million) (in thousands). A negative equity position means the company's liabilities exceed its total assets, which is a major red flag for solvency.

• Total Liabilities (Q3 2025): $86.694 million.
• Total Stockholders' Equity (Q3 2025): ($41.372 million).

The Debt-to-Equity Crisis

The debt-to-equity (D/E) ratio is what analysts use to gauge financial leverage-how much debt a company uses to finance its assets compared to shareholder funds. Here's the quick math: when equity is negative, the standard D/E calculation becomes less meaningful, but the implication is clear: Zynex, Inc. is technically insolvent from a balance sheet perspective. The company's capital structure is overwhelmingly debt-financed.

To put this into context, the median D/E ratio for the Surgical and Medical Instruments and Apparatus industry generally sits in the healthy range of 0.53 to 0.70. A company in this sector should have roughly 53 to 70 cents of debt for every dollar of equity. Zynex, Inc.'s situation is the opposite, with liabilities far outweighing a non-existent equity base. This is defintely not a balanced approach to financing growth.

Near-Term Debt and Restructuring

The most pressing issue is the maturity wall they are facing. The bulk of the debt is a $60 million Convertible Notes issuance, which is due in May 2026. Because of this near-term maturity, the entire principal amount is classified as a current liability, contributing to a high total current liability of $78.846 million (in thousands) as of Q3 2025.

The company's recent actions show the severity of the liquidity crunch. Zynex, Inc. has elected to enter a 30-day grace period on a $1.5 million interest payment due on the Convertible Notes on November 17, 2025, as part of a cash preservation strategy. This non-payment is a significant event. They are actively in discussions with note holders regarding potential restructuring opportunities and have engaged Province, LLC to explore strategic alternatives, including recapitalization.

This is a company that has moved from balancing debt and equity to fighting for a financial lifeline, a clear pivot from growth financing to survival mode. You can read more about the company's broader challenges in Breaking Down Zynex, Inc. (ZYXI) Financial Health: Key Insights for Investors.

Next Step: Monitor the outcome of the restructuring discussions with the Convertible Note holders, as this will dictate the company's immediate financial future.

Liquidity and Solvency

You're looking at Zynex, Inc. (ZYXI) right now, and the first thing you need to assess is its ability to meet its near-term obligations-its liquidity. Honestly, the picture here for Zynex, Inc. is strained, mostly due to a major debt reclassification and a sharp drop in operating cash flow.

As of September 30, 2025, the company's liquidity ratios, which measure the ability to cover short-term debt, are flashing red. This is a clear indicator of financial distress.

• The Current Ratio (Current Assets / Current Liabilities) sits at a low of approximately 0.47.
• The Quick Ratio (Cash + Accounts Receivable / Current Liabilities) is even tighter at about 0.25.

A ratio of less than 1.0 means current liabilities exceed current assets, suggesting Zynex, Inc. does not have enough liquid assets to cover all its debts coming due within the next year. Here's the quick math: Current Assets were $37.016 million against Current Liabilities of $78.846 million.

Working Capital and Near-Term Risk

The primary driver of this liquidity crunch is the reclassification of the company's $60 million Convertible Notes, which mature in May 2026, from long-term to current liabilities. This move immediately pushed the company into a negative working capital position of approximately ($41.83 million) as of Q3 2025. What this estimate hides is the extreme pressure the company is now under to refinance or restructure that debt in the very near term.

The situation is defintely critical. The company has already entered a 30-day grace period after missing a $1.5 million interest payment on those notes in November 2025, a classic sign of severe liquidity stress.

Cash Flow Statements Overview

The cash flow statement for the nine months ended September 30, 2025, shows a clear negative trend across the board, which compounds the balance sheet issues. This is where the rubber meets the road-cash is draining out of the business.

• Operating Cash Flow (CFO): This was a significant negative of ($23.011 million) for the first nine months of 2025. This reversal from prior years is directly tied to the sharp revenue decline from the Tricare payment suspension and payer claim delays. A business cannot sustain itself for long with negative cash flow from its core operations.
• Investing Cash Flow (CFI): The company used a modest ($0.215 million) in investing activities, mainly for purchasing property and equipment. This low level of capital expenditure suggests management is conserving cash and pulling back on growth-related investments.
• Financing Cash Flow (CFF): This was also negative at approximately ($3.146 million) for the nine-month period, reflecting the overall cash preservation efforts and the lack of new financing.

The net result is a total cash burn of $26.372 million over the first three quarters of 2025, leaving only $13.259 million in cash and cash equivalents on the balance sheet at the end of Q3.

To address this, Zynex, Inc. has engaged a financial advisory firm, Province, LLC, and formed a Special Committee to explore strategic alternatives like capital raising, recapitalization, or restructuring. Your action now is to monitor the outcome of these negotiations, especially regarding the $60 million convertible notes. Before making any investment decision, you should also review the Mission Statement, Vision, & Core Values of Zynex, Inc. (ZYXI).

Valuation Analysis

You're looking at Zynex, Inc. (ZYXI) and trying to figure out if the stock price makes sense. The direct takeaway is that traditional valuation metrics are distorted by recent losses, but the market is pricing the stock for a significant turnaround, making it a high-risk, high-reward proposition right now.

The company's financial health, particularly its profitability, has been under pressure. For the trailing twelve months (TTM) leading up to November 2025, Zynex, Inc. reported a loss of approximately $73.96 million. This immediately makes the Price-to-Earnings (P/E) ratio and Enterprise Value-to-EBITDA (EV/EBITDA) ratio non-applicable (N/A) or meaningless, as you cannot divide a price by a negative number. This is a classic situation where you must look at other metrics.

Here's the quick math on what the market is willing to pay for Zynex, Inc.'s assets and sales:

• Price-to-Sales (P/S): The P/S ratio stands at approximately 0.14. This is incredibly low, suggesting the market is valuing the company's $108.20 million in TTM revenue at a fraction of its sales.
• Price-to-Book (P/B): The P/B ratio is around 26.00. This is a very high number, indicating that the stock price is trading at 26 times the company's book value (assets minus liabilities). This suggests investors are betting heavily on intangible assets or a future return to high profitability, not current balance sheet strength.
• Enterprise Value-to-Sales (EV/Sales): Since EV/EBITDA is N/A, we use EV/Sales, which is approximately 0.68. This is also quite low, meaning the entire enterprise, including debt, is valued at less than its annual sales.

The stock has defintely seen better days. Over the last 52 weeks leading up to November 2025, the stock price has plummeted by a staggering -92.35%. The 52-week high was $8.72, but the closing price as of November 17, 2025, was down to $0.57. That's a brutal decline. The volatility, measured by a five-year Beta of 1.01, shows the stock's price movements have been similar to the market average, but the magnitude of the drop is clearly company-specific.

Zynex, Inc. does not pay a dividend, so the dividend yield and payout ratios are N/A. The company's focus is on reinvesting any potential capital back into the business, which is typical for a growth-oriented or turnaround-focused medical device company. If you want a dividend, this isn't the stock.

To be fair, the analyst community sees significant upside potential despite the recent turmoil. The consensus analyst rating is a 'Buy'. The average price target is highly dispersed, ranging from a low of $3.00 to a high of $17.00, with a mean target of $9.70. This wide range tells you analysts are divided on the probability and speed of a successful turnaround, especially given the recent Q3 2025 EPS loss of -$1.42.

What this estimate hides is the execution risk tied to their strategy, which you can read more about in their Mission Statement, Vision, & Core Values of Zynex, Inc. (ZYXI). The low P/S and high P/B create a mixed signal: the market is punishing the stock for current losses but still holds out hope for a return to its historical growth trajectory.

Finance: Re-evaluate the analyst price targets against the Q3 2025 earnings call transcript by Friday.

Risk Factors

You're looking at Zynex, Inc. (ZYXI) and the numbers from the third quarter of 2025 are a serious wake-up call. The primary takeaway is this: the company is facing an immediate liquidity crisis driven by regulatory and financial pressures. This isn't a minor hiccup; it's a fundamental challenge to the business model that requires decisive action from management and a clear-eyed view from investors.

The near-term risks map directly to the Q3 2025 results, which showed net revenue collapse to just $13.4 million, down sharply from $50.0 million in the prior year quarter. This revenue shock, combined with balance sheet stress, creates a precarious situation that you need to watch closely.

External and Regulatory Overhang

The single largest external risk is the ongoing Tricare payment suspension. Tricare, the U.S. military health program, was a significant revenue source, and its suspension, along with a $2.8 million revenue reduction related to payments during the suspension period, is the main driver of the sales decline.

Also, changes to payer claim submission and review practices are causing denials and payment delays, which is a structural headwind in the medical device space. This regulatory and payer uncertainty is what's crushing the top line and compressing the gross profit margin, which fell from 80% in Q3 2024 to 60% in Q3 2025.

Financial and Operational Stress Points

The financial health of Zynex, Inc. is now the most critical factor. The company reported a net loss of a staggering ($42.9) million for the third quarter of 2025. Here's the quick math on the liquidity issue:

• Cash on hand was only $13.3 million as of September 30, 2025.
• The company missed a $1.5 million interest payment due November 17, 2025, on its $60 million Convertible Notes.
• Those Convertible Notes mature in May 2026, meaning a significant refinancing or restructuring is defintely required in the next six months.

Operationally, the prior workforce reductions in the first and second quarters of 2025, while intended to save costs, hurt the business by negatively impacting device orders and new patient onboarding. Plus, management took a non-cash asset impairment charge of $30.7 million, primarily tied to the Zynex Monitoring Solutions business, signaling a clear write-down of value in a key strategic area.

Mitigation and Next Steps

Management is not sitting still, but the path forward is complex. They've engaged Province, LLC, a financial advisory firm, to explore a range of strategic alternatives, including capital raising and restructuring. A Special Committee, chaired by Paul Aronzon, has been formed to oversee this process.

The new CEO, Steven Dyson, has outlined a three-part strategy to stabilize the business: renew compliance, address liquidity challenges, and improve revenue/cash flow performance. The immediate action is watching the 30-day grace period on the missed interest payment. If you want to dive deeper into the market dynamics around the stock, you can read Exploring Zynex, Inc. (ZYXI) Investor Profile: Who's Buying and Why?

The core mitigation strategy is a financial restructuring and a renewed focus on compliance to get back into the good graces of payers like Tricare. This is a turnaround story now, not a growth story.

Growth Opportunities

You're looking for a clear map of Zynex, Inc. (ZYXI)'s future, but the near-term landscape is complicated. The company's growth story still rests on its core non-opioid pain management devices and a major new hospital monitoring product, but recent financial turbulence-specifically the Tricare payment suspension-has forced a sharp strategic pivot.

The core growth driver remains the shift away from opioids, which positions Zynex, Inc.'s flagship NexWave device well. They've also expanded their pain management portfolio with the TensWave device, which received FDA clearance in September 2024. This new device is a smart, tactical move, designed specifically for patients whose insurance plans only cover Transcutaneous Electrical Nerve Stimulation (TENS) therapy, broadening the company's market reach beyond the multi-modality NexWave. It's a clean one-liner: new products target specific reimbursement gaps.

The big, long-term opportunity is in the Hospital Monitoring division. Zynex, Inc. is developing a laser-based pulse oximeter (called NiCO) that aims to address a critical flaw in current technology: poor accuracy on darker skin tones. This product, which also monitors carbon monoxide and hemoglobin levels, was expected to be commercialized in the second half of 2025, opening up a new, massive market beyond pain management. Plus, they are actively working to increase penetration in the Veterans Affairs (VA) business by engaging a new partner, which is a key strategic initiative for a stable payer base. Exploring Zynex, Inc. (ZYXI) Investor Profile: Who's Buying and Why?

Financial Projections and Near-Term Headwinds

Honesty requires us to address the recent financial data. Earlier in 2025, the CEO projected 10% to 15% top-line revenue growth for the year. However, the unexpected, temporary Tricare payment suspension-which accounts for roughly 20% to 25% of annual revenue-has severely impacted those projections. The Q3 2025 results, reported in November 2025, show the immediate effect of this risk.

Here's the quick math on the recent performance:

• Q3 2025 Net Revenue: $13.4 million (down from $50 million in Q3 2024).
• Q3 2025 Net Loss: $42.9 million (compared to a net income of $2.4 million in Q3 2024).
• Q3 2025 Adjusted EBITDA Loss: $12.3 million.

What this estimate hides is the underlying operational challenge. Analyst full-year 2025 revenue estimates now range from a cautious $116.52 million to approximately $144.808 million, with consensus earnings estimates pointing to a loss of around -$0.78 to -$0.80 per share for the full year. The company is taking decisive action, including a staff reduction of approximately 15% earlier in the year, which is expected to result in annual savings of around $35 million.

Competitive Edge and Liquidity Risk

Zynex, Inc.'s competitive advantage isn't just the device technology; it's their reimbursement strategy. They have a strong, dedicated reimbursement department that successfully navigates the complex US system, working with literally thousands of insurance carriers to ensure coverage for their products. This capability is defintely a high barrier to entry for competitors. They are a one-stop shop for non-medication pain management.

Still, you must map the liquidity risk to your actions. In November 2025, Zynex, Inc. engaged a financial advisory firm, Province, LLC, to evaluate strategic alternatives, including restructuring. Critically, the company elected to enter the 30-day grace period on a $1.5 million interest payment due on its $60 million of convertible notes, which mature in May 2026. This signals a serious, near-term liquidity challenge that must be resolved to stabilize the company and allow the underlying product-driven growth strategy to play out.