10-K: Lifeward Faces Going Concern Doubt Amid Revenue Dip, Strategic Shifts

Lifeward Ltd. reported a 14% revenue decrease to $22.0 million in 2025, alongside a reduced net loss, but acknowledged substantial doubt about its ability to continue as a going concern.

Summary

• Revenue for the year ended December 31, 2025, decreased by $3.6 million, or 14%, to $22.0 million, compared to $25.6 million in 2024.
• Net loss improved to $19.9 million in 2025 from $28.9 million in 2024.
• Gross profit increased slightly to $8.4 million (38% of revenue) in 2025 from $8.2 million (32% of revenue) in 2024, primarily due to the absence of $1.5 million in amortization and $1.2 million in restructuring expenses from 2024.
• Research and development expenses decreased by 30% to $3.2 million in 2025, mainly due to the substantial completion of ReWalk 7 and NEO product development.
• Sales and marketing expenses decreased by 23% to $13.9 million in 2025, driven by lower amortization, reimbursement, trade show, and marketing consultant expenses, as well as headcount reductions.
• General and administrative expenses increased by 58% to $8.2 million in 2025, primarily due to restructuring expenses related to the former CEO's departure and costs associated with the Oramed transaction.
• The company recorded a goodwill impairment charge of $2.8 million in 2025, compared to $9.8 million in intangible asset impairment in 2024.
• Cash and cash equivalents stood at $2.2 million as of December 31, 2025, down from $6.7 million in 2024.
• Lifeward completed a registered direct offering in January 2025 for $5.0 million gross proceeds and a public offering in June 2025 for $2.6 million gross proceeds.
• The company secured a $3.0 million bridge loan from Oramed Ltd. in November 2025 and an additional $525,000 secured promissory note from Oramed in February 2026, which was increased to $1.025 million in March 2026.
• Shareholders approved a strategic investment and collaboration agreement with Oramed Pharmaceuticals, Inc. in March 2026, which includes the acquisition of Oratech Pharma, Inc. and issuance of equity and convertible notes.
• Lifeward effected a 1-for-12 reverse share split on February 24, 2026, to regain Nasdaq compliance, following a 1-for-7 reverse split on March 15, 2024.
• The ReWalk 7 Personal Exoskeleton received FDA 510(k) clearance in March 2025 and CE Mark approval in September 2025.
• CMS established a lump-sum Medicare purchase fee schedule amount of $91,032 for personal exoskeletons (HCPCS code K1007) effective April 1, 2024.
• An Administrative Law Judge ruled in June 2025 that the ReWalk Personal Exoskeleton is a reasonable and necessary medical device for Medicare beneficiaries.
• Distribution agreements were announced with CorLife, LLC. in March 2025 for the workers' compensation market and with Verita Neuro in December 2025 for international markets.
• Manufacturing of ReWalk products transitioned to in-house in Q2 2025, and AlterG product manufacturing transitioned to Cirtronics Corporation in January 2025.

Sentiment

Score: 3

Explanation: StockSavvy.ai views this as a challenging period for Lifeward, marked by declining revenue and explicit 'going concern' doubt, despite some positive developments in product approvals and reimbursement pathways. The heavy reliance on high-interest debt and equity raises for liquidity indicates significant financial pressure.

Positives

• Net loss decreased significantly to $19.9 million in 2025 from $28.9 million in 2024, indicating improved cost management.
• Gross margin improved to 38% in 2025 from 32% in 2024, partly due to the absence of prior year's amortization and restructuring expenses and the transition to in-house manufacturing for ReWalk products.
• The ReWalk 7 Personal Exoskeleton received FDA 510(k) clearance in March 2025 and CE Mark approval in September 2025, introducing new features like cloud connectivity and customizable walking speeds.
• CMS established a lump-sum Medicare purchase fee of $91,032 for personal exoskeletons (HCPCS code K1007) effective April 1, 2024, providing a clear reimbursement pathway.
• An Administrative Law Judge (ALJ) ruling in June 2025 affirmed Medicare coverage for the ReWalk Personal Exoskeleton as a reasonable and necessary medical device, establishing a legal precedent.
• New distribution agreements with CorLife, LLC. (workers' compensation market) and Verita Neuro (Mexico, Thailand, UAE) are expected to expand market access for ReWalk products.
• An agreement with BARMER, Germany's second-largest statutory health insurance company, finalized in February 2025, streamlines reimbursement for ReWalk exoskeletons for approximately 8.5 million covered lives.
• The acquisition of intellectual property and technology assets from Skelable Ltd. in February 2026 is intended to expand the neurorehabilitation platform beyond lower-limb systems.
• The company successfully transitioned ReWalk manufacturing in-house in Q2 2025, aiming for cost savings and improved quality control.

Negatives

• Revenue decreased by 14% to $22.0 million in 2025 from $25.6 million in 2024, primarily due to reduced AlterG sales and decreased MyoCycle revenue.
• The company reported a cash and cash equivalents balance of only $2.2 million as of December 31, 2025, down from $6.7 million in 2024.
• Substantial doubt exists about the company's ability to continue as a going concern, necessitating additional financing.
• General and administrative expenses increased by 58% to $8.2 million in 2025, partly due to restructuring costs and Oramed transaction-related expenses.
• A goodwill impairment charge of $2.8 million was recorded in 2025, following a $9.8 million intangible asset impairment in 2024, indicating challenges with prior acquisitions or asset valuations.
• The ReStore Exo-Suit product ceased sales in the European Union in May 2024 due to non-conformity with MDR, and it represents a limited portion of the business in the U.S.
• Further investment in the ReBoot product development was paused in 2023 and remains on hold, indicating uncertainty about its commercial opportunity.
• The company is subject to limitations on selling more than one-third of its unaffiliated market capitalization on Form S-3 in a 12-month period, restricting capital raising flexibility.
• The secured promissory notes from Oramed carry high interest rates (15% and 24% per annum) and are secured by a lien on the company's cash.

Risks

• Substantial doubt exists about the company's ability to continue as a going concern, requiring additional financing to meet obligations.
• Failure to fully realize anticipated benefits from streamlining efforts, including cost reductions and improved gross margins, could adversely affect financial results.
• Difficulties in transitioning ReWalk product manufacturing to in-house operations, including recruiting experienced teams and sourcing components, could disrupt operations.
• Economic and political risks associated with doing business in Taiwan (due to geopolitical tension with China) and Russia (due to the Ukraine conflict) could negatively affect business and component supply.
• Inability to develop, receive regulatory clearance for, and commercialize new products or penetrate new markets beyond existing offerings could hinder future growth.
• Failure to achieve or maintain market acceptance and adequate insurance coverage or reimbursement for ReWalk, AlterG, or MyoCycle products by third-party payors could limit revenue and profitability.
• Product defects or software errors in ReWalk, AlterG, or ReStore systems could lead to recalls, safety alerts, product liability claims, and reputational damage.
• The potential health benefits of ReWalk products have not been substantiated by long-term clinical data, which could limit sales and reimbursement.
• Reliance on third-party contract manufacturers for AlterG products and a limited number of suppliers for components exposes the company to supply chain disruptions, capacity constraints, and increased costs.
• Intense competition in the medical exoskeleton and anti-gravity rehabilitation markets from companies with greater resources or more established product lines could render current products obsolete.
• Reliance on independent distributors who may market competing products could adversely affect sales if key distributors cease to distribute Lifeward's products.
• Inability to enhance exoskeleton product offerings through R&D or successfully develop new products for additional indications (e.g., multiple sclerosis, Parkinson's disease) could limit future growth.
• Collaborations, in-licensing arrangements, joint ventures, strategic alliances, or acquisitions may not result in commercially viable products or significant future revenue, and integration efforts carry risks.
• Breakthrough Device Designation for ReBoot does not guarantee regulatory clearance or a speedier timeline, and further development is currently on hold.
• U.S. healthcare reform measures and other legislative initiatives could adversely affect business by imposing price limitations or reducing reimbursement.
• Failure to comply with FDA regulations pertaining to marketing and promotional communications could lead to enforcement actions.
• Non-compliance with extensive governmental regulations related to manufacturing, labeling, and marketing could result in product withdrawal or recall.
• Violations of fraud and abuse laws (e.g., False Claims Act, Anti-Kickback Statute) and anti-bribery laws (e.g., FCPA) could lead to substantial penalties and reputational harm.
• Failure to protect intellectual property rights in all countries or against infringement claims could result in substantial costs and prevent commercialization.
• Sales of a substantial number of ordinary shares by the company or large shareholders, or dilutive exercises of warrants, could adversely affect share value.
• The company's status as a smaller reporting company with reduced reporting requirements may make its shares less attractive to investors.
• Ongoing costs and risks associated with complying with Section 404 of the Sarbanes-Oxley Act and maintaining adequate internal controls could affect financial reporting and reputation.
• Potential characterization as a Passive Foreign Investment Company (PFIC) or Controlled Foreign Corporation (CFC) could result in adverse U.S. tax consequences for shareholders.
• The market price of ordinary shares may be volatile due to various factors, including market conditions, competition, and company announcements.
• Actions of activist shareholders could be disruptive and costly, impacting operations and stock value.
• Political, economic, and military instability in Israel or the Middle East could adversely affect business operations, supply chains, and financial condition.
• Restrictions on transferring IIA-supported technology or manufacturing outside of Israel could incur penalties or limit strategic flexibility.
• Claims for remuneration or royalties for assigned service invention rights by employees could result in litigation and adversely affect business.
• Provisions of Israeli law and the Articles of Association may delay or prevent mergers or acquisitions, even if favorable to shareholders.
• Difficulty in enforcing U.S. court judgments against the company or its officers/directors in Israel.
• Business uncertainties and contractual restrictions prior to and after the Oramed transaction could disrupt business and relationships.
• Oramed will have significant control and influence over the company if the transaction is consummated, potentially affecting corporate governance.
• The terms of the Oramed Securities Purchase Agreement and Notes impose restrictive covenants on operating and financial flexibility.
• No assurances that Oratech's proprietary POD technology will receive necessary regulatory approvals or be successfully developed and commercialized.
• Exchange rate fluctuations between the U.S. dollar, euro, and NIS may negatively affect earnings.

Future Outlook

Lifeward expects future growth to be primarily driven by sales of its ReWalk Personal device through expanded reimbursement coverage and channel partnerships. The company also anticipates increased shipments of AlterG Anti-Gravity systems through greater penetration of rehabilitation clinics and an expanded international distributor network. Research and development efforts will focus on product improvements, ongoing enhancements to current products, and reducing material costs for ReWalk and AlterG lines. Investment is also planned for the development and integration of technologies acquired from Skelable. The company intends to finance operations through existing cash, reduced operating cash burn, and future equity/debt issuances, or strategic partnerships, acknowledging the need for additional capital to achieve profitability.

Management Comments

• Management concluded that substantial doubt about the company's ability to continue as a going concern exists as of the date of the issuance of these financial statements.
• We expect that gross profit and gross margin will expand in the future as we increase our revenue volumes and realize operating efficiencies associated with greater scale which will reduce the cost of revenue as a percentage of revenue.
• We expect to invest in the development and integration of technologies acquired as part of the Skelable transaction.
• Our sales and marketing expenses are expected to be driven by our efforts to facilitate growth in sales of our commercial product lines, expand reimbursement coverage for our ReWalk Personal Exoskeleton device, support training activities of ReWalk customers, promote sales through channel partners, and increase adoption of our AlterG Anti-Gravity systems through greater penetration of rehabilitation clinics and hospitals and expansion of our distributor network internationally.
• We believe that the current separation between Chairman and CEO allows each of them to better focus on their designated responsibilities. In addition, we believe that the current separation provides a more effective monitoring and objective evaluation of the performance of the CEO.

Industry Context

StockSavvy.ai notes that Lifeward operates in the rapidly evolving medical device industry, specifically within physical and neurological rehabilitation. The company's focus on expanding reimbursement pathways for exoskeleton technologies, particularly with Medicare and German SHIs, aligns with a broader industry trend of seeking established coverage for innovative, high-cost medical devices. The acquisition of AlterG and the planned Skelable transaction reflect a strategy to diversify product offerings beyond spinal cord injury (SCI) to include stroke rehabilitation and upper-body orthotics, addressing a wider patient population. Competition remains active, with several companies developing similar exoskeleton and anti-gravity systems, necessitating continuous R&D and market differentiation. The company's efforts to streamline operations and transition manufacturing in-house are common strategies to improve cost efficiency and quality control in a competitive landscape.

Comparison to Industry Standards

• Lifeward's ReWalk Personal Exoskeleton is highlighted as the only medical exoskeleton with FDA and CE clearance for use on stairs and curbs, providing a competitive advantage over products from Ekso Bionics, Rex Bionics, Cyberdyne, and others.
• The AlterG Anti-Gravity systems differentiate themselves through proprietary Differential Air Pressure technology, which allows precise and comfortable body-weight support, competing with treadmill-based rehabilitation technologies from companies like BTL Industries and DIH.
• The ReStore Exo-Suit is noted for its soft, fabric-based design that facilitates a natural walking pattern and provides targeted mechanical assistance, making it a unique solution compared to rigid exoskeletal devices for stroke rehabilitation.
• The company's market penetration for AlterG systems, with over 6,000 units globally, suggests a strong installed base in the anti-gravity rehabilitation segment, although specific market share data relative to competitors is not provided.

Management Changes

Corporate Governance

Legal Proceedings

• The company is occasionally involved in various claims, lawsuits, regulatory examinations, investigations, and other legal matters arising in the ordinary course of business.
• Management does not believe the outcome of any pending or threatened litigation will have a material adverse effect on the company's consolidated results of operation, liquidity, or financial condition.

Related Party Transactions

• The company entered into a $3.0 million Secured Promissory Note with Oramed Ltd. on November 14, 2025, bearing 15% interest, secured by a lien on cash.
• An additional Secured Promissory Note for $525,000 was entered into with Oramed on February 12, 2026, increased to $1,025,000 on March 11, 2026, bearing 24% interest, secured by a lien on cash.
• A Share Purchase Agreement was signed on January 12, 2026, with Oramed Pharmaceuticals, Inc. and Oratech Pharma, Inc. to acquire Oratech, involving the issuance of ordinary shares and pre-funded warrants to Oramed (up to 49.99% fully diluted equity) and transaction warrants, plus 4% revenue sharing payments on ReWalk Personal Exoskeleton sales.
• A Securities Purchase Agreement was also entered into with Oramed and certain investors on January 12, 2026, for up to $20.0 million of senior secured convertible notes, including $10.0 million at closing, together with accompanying warrants.
• Michael Swinford, a member of the Board, serves as CEO of Numotion, the parent company of CorLife, LLC., with whom Lifeward entered an exclusive distribution agreement for ReWalk Personal Exoskeleton for workers' compensation claims in March 2025. The Board reviewed and approved the financial terms as arms-length.
• Randel E. Richner, a Board member, received equity compensation in the form of stock options (three tranches totaling $297,000 in value) for excess consulting hours provided in 2022-2024, approved by shareholders in 2024.

Stakeholder Impact

• Shareholders face potential dilution from recent and planned equity offerings and warrant exercises, as well as the Oramed transaction, which will result in Oramed holding a significant percentage of ordinary shares.
• Shareholders are exposed to substantial doubt about the company's ability to continue as a going concern, which could lead to a loss of investment value.
• Employees may experience changes in roles and responsibilities due to streamlining efforts and the integration of acquired businesses like AlterG and Skelable.
• Customers (patients, clinics, sports teams) may benefit from expanded product offerings (ReWalk 7, AlterG NEO, Skelable technology) and improved reimbursement pathways, increasing access to rehabilitation solutions.
• Suppliers face potential changes in manufacturing relationships as the company transitions ReWalk production in-house and relies on Cirtronics for AlterG, with risks of supply chain disruptions.
• Creditors, particularly Oramed, have secured promissory notes with high interest rates, indicating a higher risk profile for the company's debt.

Next Steps

• Close the strategic investment and collaboration agreement with Oramed Pharmaceuticals, Inc. and the acquisition of Oratech Pharma, Inc. following satisfaction of customary closing conditions.
• Focus research and development efforts primarily on product improvements and ongoing enhancements to current products (ReWalk and AlterG).
• Invest in the development and integration of technologies acquired as part of the Skelable transaction (upper-body robotic orthotic system).
• Continue efforts to facilitate growth in sales of commercial product lines and expand reimbursement coverage for the ReWalk Personal Exoskeleton.
• Support training activities for ReWalk customers and promote sales through channel partners.
• Increase adoption of AlterG Anti-Gravity systems through greater penetration of rehabilitation clinics and hospitals and expansion of the international distributor network.
• Seek additional sources of financing through equity/debt issuances or strategic partnerships to meet future cash requirements and address the going concern doubt.
• Hold a special meeting of shareholders (or annual meeting) to obtain Shareholder Approval for the Oramed transaction, if requested by the Noteholder, and use reasonable best efforts to obtain such approval.

Key Dates

Recommendation

A seasoned investor or institution would likely recommend 'sell' for Lifeward Ltd. due to the explicit disclosure of 'substantial doubt as to our ability to continue as a going concern.' This fundamental risk overshadows any positive developments. The 14% decline in revenue, coupled with a low cash balance of $2.2 million, indicates ongoing operational challenges. While net loss decreased and gross margin improved, these are insufficient to offset the severe liquidity concerns. The reliance on multiple, often dilutive, capital raises and high-interest debt from Oramed to sustain operations further exacerbates the risk profile. The pending Oramed transaction, while providing capital, also introduces significant control by Oramed and restrictive covenants, which could limit future strategic flexibility. Geopolitical risks and the competitive landscape add further uncertainty, making the stock a high-risk investment with significant downside potential.

Keywords

Exoskeleton, Rehabilitation, Medical Device, Spinal Cord Injury, Stroke, Anti-Gravity System, ReWalk, AlterG, MyoCycle, SEC Filing, 10-K, Financial Results, Going Concern, Capital Raise, Reimbursement, FDA Clearance, CE Mark, Corporate Governance, Israel, Nasdaq