Neuronetics improved margins, reached positive adjusted EBITDA and lowered its 2026 operating expense outlook, although NeuroStar revenue declined during the quarter.
Key Investor Takeaways
- Neuronetics (NASDAQ:STIM) reported second-quarter revenue of $41.6 million, up 9.1% year over year, driven primarily by continued Greenbrook clinic growth.
- Adjusted EBITDA turned positive at $0.3 million versus a $5.6 million loss a year earlier, while net loss narrowed to $3.4 million from $10.1 million.
- Greenbrook revenue increased 16.8% to $26.9 million, offsetting a 2.7% decline in NeuroStar revenue to $14.7 million.
- Gross margin expanded to 51.1% from 46.6%, while operating expenses fell 12% to $22.7 million.
- Neuronetics lowered its full-year operating expense guidance and raised its gross margin range, strengthening the company’s stated push toward sustained profitability and positive cash flow.
Why (NASDAQ:STIM) Stock Is in Focus
Neuronetics’ Q2 loss narrowed substantially as growth at its Greenbrook clinics, margin expansion and lower expenses moved the company closer to profitability.
Total revenue increased to $41.6 million from $38.1 million in the second quarter of 2025. Greenbrook was the main growth engine, with revenue rising to $26.9 million from $23.0 million.
Performance in the NeuroStar segment was weaker, with revenue declining 2.7% to $14.7 million from $15.1 million. Management said it is broadening the ways customers can access NeuroStar as part of a revised go-to-market strategy.
The more notable improvement came further down the income statement. Gross margin increased 450 basis points to 51.1%, which the company attributed to its new commercial strategy and improved revenue cycle management within Greenbrook.
Operating expenses declined 12% to $22.7 million, helping reduce the operating loss to $1.5 million from $8.1 million. Adjusted EBITDA improved by $5.9 million to positive $0.3 million.
Net loss narrowed to $3.4 million, or $0.05 per share, from $10.1 million, or $0.15 per share, a year earlier.
Why This Matters for Investors
The quarter suggests Neuronetics is making measurable progress on operating efficiency rather than relying solely on revenue growth to improve its financial profile.
Greenbrook’s 16.8% growth is particularly important because the clinic network now accounts for the majority of company revenue. Combined with better revenue cycle management, that growth contributed to stronger margins and may support further operating leverage if the trend continues.
At the same time, the decline in NeuroStar revenue remains an important counterpoint. Management acknowledged that NeuroStar has not competed to its full potential and is changing its customer-access strategy. Future performance in that segment could therefore help determine whether growth becomes more balanced across the company’s technology and care-delivery businesses.
Cash usage also improved. Net cash used in operations and investing was $1.4 million during the quarter, compared with $3.8 million a year earlier. Neuronetics nevertheless ended June with $25 million of total cash, including $19.2 million of cash and equivalents and $5.8 million of restricted cash, down from $34.1 million at year-end.
The updated outlook provides another indicator of management’s emphasis on cost control. Neuronetics reduced its full-year operating expense forecast to $95 million-$100 million from $100 million-$105 million and increased its expected gross margin range to 48%-50% from 47%-49%.
What to Watch Next
Neuronetics now expects 2026 revenue of $160 million-$164 million, narrowing the previous $160 million-$166 million range. Investors can watch whether continued Greenbrook growth and the revised NeuroStar go-to-market strategy allow the company to sustain positive adjusted EBITDA.
Cash generation will also remain important. The company expects full-year cash flow from operations and investing of negative $10.5 million to negative $14.5 million, while its progress on lower operating expenses and higher margins could provide clearer evidence of whether the business is moving toward its goal of sustained profitability and positive net cash flow.
Neuronetics stock price
