10-K: PROCEPT BioRobotics Reports Strong 2025 Revenue Growth

PROCEPT BioRobotics Corporation announced significant revenue growth in its 2025 annual report, driven by increased adoption and utilization of its robotic systems for BPH treatment, despite continued net losses.

Summary

• Revenue increased by 37% to $308.1 million for the year ended December 31, 2025, up from $224.5 million in 2024.
• The company reported a net loss of $95.6 million for 2025, compared to $91.4 million in 2024, with an accumulated deficit of $641.6 million as of December 31, 2025.
• The global install base of AquaBeam and HYDROS Robotic Systems reached 912 as of December 31, 2025, including 718 in the United States.
• The next-generation HYDROS Robotic System, featuring FirstAssist AI, received FDA 510(k) clearance in August 2024.
• Aquablation therapy has achieved broad market access, with an estimated 95% of all men in the United States covered by large commercial payors and 100% of eligible Medicare patients.
• A new Category I CPT code (52597) for Aquablation therapy became effective on January 1, 2026, replacing the Category III code 0421T.
• The company continues to invest in research and development, including two single-arm prostate cancer clinical trials (PRCT001, PRCT002) and a pivotal IDE clinical trial (WATER IV PCa) comparing Aquablation therapy to radical prostatectomy for localized prostate cancer.
• The estimated total addressable market opportunity for BPH in the United States is approximately $30 billion.

Sentiment

Score: 7

Explanation: StockSavvy.ai views this as a moderately positive report, highlighting strong revenue growth and product adoption, alongside strategic investments in R&D and market expansion. However, continued net losses and reliance on single-source suppliers temper the overall sentiment.

Positives

• Revenue increased significantly by 37% year-over-year, reaching $308.1 million in 2025.
• Gross margin improved to 64% in 2025 from 61% in 2024, driven by increased unit sales and scale efficiencies.
• The next-generation HYDROS Robotic System, featuring FirstAssist AI, received FDA 510(k) clearance in August 2024.
• FDA 510(k) clearance was obtained in August 2023 to remove the contraindication for treating BPH in patients with an active prostate cancer diagnosis.
• Aquablation therapy has strong market access, with coverage for approximately 95% of U.S. men by large commercial payors and 100% of eligible Medicare patients.
• A new Category I CPT code (52597) for Aquablation therapy became effective on January 1, 2026, providing similar payment to TURP procedures.
• The global install base of robotic systems grew to 912, with 718 in the United States, indicating increasing adoption.
• Extensive clinical evidence supports Aquablation therapy, including nine clinical studies and over 150 peer-reviewed publications, demonstrating superior safety and non-inferior efficacy compared to TURP in the WATER study.
• Net cash used in operating activities decreased to $49.0 million in 2025 from $99.2 million in 2024, indicating improved operational cash flow efficiency.

Negatives

• The company reported a net loss of $95.6 million in 2025 and expects to continue incurring operating losses for the foreseeable future.
• An accumulated deficit of $641.6 million as of December 31, 2025, highlights historical unprofitability.
• High dependence on sales of current robotic systems and single-use disposable handpieces for substantially all revenue.
• Increased R&D expenses by 14% to $71.3 million and SG&A expenses by 33% to $228.8 million in 2025, reflecting significant investment without immediate profitability.
• Reliance on third-party, almost all single-source, suppliers for critical components makes the company vulnerable to supply shortages and price fluctuations.
• The loan and security agreement contains restrictive covenants and financial targets, with potential for debt acceleration if not met.

Risks

• The company has a history of significant net losses and expects to continue incurring operating losses for the foreseeable future, with no assurance of achieving or sustaining profitability.
• Revenue is primarily generated from sales of robotic systems and single-use disposable handpieces, making the company highly dependent on the success of these products.
• The terms of the loan and security agreement require meeting certain operating and financial covenants and place restrictions on operating and financial flexibility; new debt could further restrict business operations.
• Commercial success depends on the degree of market acceptance of products among hospitals, surgeons, and patients, which may be slow or limited.
• Limited experience in training, marketing, and selling products, with potential for inadequate training, failure to increase sales capabilities, or failure to develop brand awareness cost-effectively.
• Inability to maintain adequate levels of third-party coverage and reimbursement, or risk of rescinded/modified coverage or delayed payments.
• Intense competition from many sources, including larger companies and alternative BPH treatments, may hinder successful competition.
• Limited experience manufacturing products in large-scale commercial quantities, facing manufacturing risks that could delay, prevent, or impair growth.
• Dependence on third-party suppliers, including contract manufacturers and single-source suppliers, makes the company vulnerable to supply shortages and price fluctuations.
• Information technology systems, or those used by third-party service providers, partners, contractors, or consultants, may fail or suffer security breaches, negatively affecting business.
• Failure to comply with data protection laws and regulations could lead to government enforcement actions, private litigation, and/or adverse publicity.
• Product liability lawsuits could result in substantial liabilities, requiring limitation or halt of marketing/sale, and insurance coverage may be expensive or unavailable.
• Cost-containment efforts of customers, purchasing groups, and governmental organizations could have a material adverse effect on sales and profitability.
• High dependence on the senior management team and key personnel; inability to attract and retain personnel could harm the business.
• Changes to reimbursement rates for BPH treatments and measures to reduce healthcare costs may adversely impact the business.
• Robotic systems and operations are subject to extensive government regulation and oversight; failure to maintain necessary marketing authorizations or delays in approvals for future products/modifications could negatively affect business.
• Subject to ongoing regulatory review and scrutiny post-marketing authorization; failure to comply with post-marketing requirements could lead to enforcement actions, penalties, or product recalls/withdrawals.
• Need to obtain, maintain, and protect intellectual property; failure to do so may adversely impact competitive position.
• Potential involvement in intellectual property litigation or administrative proceedings that could be expensive, time-consuming, unsuccessful, and interfere with the ability to sell/market products.
• Claims challenging the ownership or inventorship of patents/IP; if unsuccessful, may require licenses from third parties (potentially unavailable or on unreasonable terms) or cessation of development/commercialization.
• Patents covering products could be found invalid or unenforceable if challenged in court or before administrative bodies globally.
• The market price of common stock may be volatile or decline steeply/suddenly regardless of operating performance, leading to substantial losses for stockholders.
• Future securities issuances could result in significant dilution to stockholders and impair the market price of common stock.
• Inability to maintain adequate internal control over financial reporting or produce timely/accurate financial statements could lead to loss of investor confidence and stock price decline.
• The use of artificial intelligence in the business, including in products and internally, may expose the company to additional legal, regulatory, and other risks.
• Natural or man-made disasters and other similar catastrophic events outside of control may significantly disrupt the business.
• The sizes of the addressable markets for products have not been established with precision and potential market opportunity may be smaller than estimated and may decline.
• Until broader market acceptance of products is achieved, the company may face risks associated with a more concentrated customer base.
• The company may be subject to regulatory or enforcement actions if it engages in improper marketing or promotion of its products.
• Legislative or regulatory reforms may make it more difficult and costly to obtain regulatory clearance or approval of any future products and to manufacture, market, and distribute products after clearance or approval is obtained.
• Clinical trials may be necessary to support future product submissions to the FDA; the process is lengthy, expensive, with uncertain outcomes, and suitable patients may be difficult to identify and recruit.
• Reliance on third parties to conduct clinical trials and assist with pre-clinical development; their non-performance could hinder regulatory clearance or approval for or commercialization of products.
• Changes in funding or disruptions at the FDA and other government agencies caused by funding shortages or global health concerns could hinder their ability to perform normal business functions.
• Employees, collaborators, independent contractors, and consultants may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements.
• The company must comply with environmental and occupational safety laws.
• The company may be unsuccessful in licensing or acquiring intellectual property rights from third parties that may be necessary to develop, manufacture, and/or commercialize current and/or future products or services.
• Inability to protect the confidentiality of trade secrets could harm the business and competitive position.
• The company may be subject to claims that it or its employees have misappropriated the intellectual property of a third party, including trade secrets or know-how, or are in breach of non-competition or non-solicitation agreements.
• Changes in patent law could diminish the value of patents in general, thereby impairing the ability to protect existing and future products or services, and could increase uncertainties and costs.
• Inability to protect intellectual property and proprietary rights throughout the world.
• Use of open source software could subject proprietary software to general release, adversely affect ability to sell products, and subject to possible litigation.
• Intellectual property rights do not necessarily address all potential threats.
• Litigation and other legal proceedings may adversely affect the business.
• General economic and financial market conditions may exacerbate business risks.
• Ongoing and potential conflicts (e.g., Israel-Hamas) could adversely affect the business, financial condition, or results of operations.
• If securities or industry analysts either do not publish research about the company or publish inaccurate or unfavorable research, the trading price or trading volume of common stock could decline.
• Increasing focus on environmental sustainability and social initiatives could increase costs, harm reputation, and adversely impact financial results.

Future Outlook

The company expects revenue to increase in absolute dollars for the foreseeable future, driven by continued adoption of Aquablation therapy and increased system utilization. While R&D and SG&A expenses are anticipated to increase in absolute dollars, they are expected to decrease as a percentage of revenue over time. The company believes its existing cash and anticipated revenue will be sufficient to fund operations for at least the next 12 months, with plans to expand sales and marketing, invest in clinical trials, and develop product improvements and future technologies, including leveraging AI and machine learning.

Management Comments

• Our mission is to revolutionize BPH treatment globally in partnership with urologists by delivering best-in-class robotic solutions that positively impact patients and drive value.
• We believe that Aquablation therapy represents a paradigm shift in the surgical treatment of BPH by addressing compromises associated with alternative surgical interventions.
• We believe that our strong body of clinical evidence and support from key societies, supplemented by the momentum from Medicare coverage, have led to favorable coverage decisions from many large commercial payors, which we estimate allows access to Aquablation therapy to approximately 95% of all men in the United States.
• We believe we can reach these patients by continuing to educate our network of urologists about the clinical benefits of Aquablation therapy, provide comprehensive training programs and deepen our relationships with key urologists and various medical societies.
• We believe our investment in level one clinical research will support future commercial, regulatory and reimbursement efforts to drive growth.
• We believe our focus on this experience will allow us to continue to bring new upgrades, capabilities and products to market, allowing us to innovate and maintain our competitive positioning.

Industry Context

StockSavvy.ai notes that PROCEPT BioRobotics operates in the highly competitive and rapidly changing medical device industry, specifically within urology. The company's focus on robotic solutions for BPH, particularly with its Aquablation therapy, positions it against both established resective (e.g., TURP, laser enucleation from Boston Scientific) and non-resective (e.g., UroLift from Teleflex, Rezum from Boston Scientific) surgical treatments, as well as pharmaceutical options. The introduction of AI-enabled features like FirstAssist AI in the HYDROS system aligns with broader industry trends towards advanced imaging and automation in surgery, aiming to differentiate from competitors by offering consistent, surgeon-independent outcomes and a favorable safety profile. The significant addressable market for BPH and potential expansion into prostate cancer indicate a substantial growth opportunity, but also attract intense competition and require continuous innovation and strong clinical evidence.

Comparison to Industry Standards

• Aquablation therapy demonstrated superior safety and non-inferior efficacy compared to transurethral resection of the prostate (TURP), the historical standard of care for BPH surgical treatment, in the WATER study for prostate sizes between 30 ml and 80 ml.
• In the WATER study, Aquablation therapy patients maintained a significantly higher level of sexual function compared to those who underwent TURP.
• Surgical retreatment rates for Aquablation therapy were 5.2% at five years in the WATER study and 3.0% at five years in the WATER II study, which compare favorably to reported rates for TURP (8% at three years) and photoselective vaporization of the prostate (PVP) (11% at three years).
• The WATER III study, comparing Aquablation therapy to laser enucleation for prostate sizes 80 ml to 180 ml, showed similar symptom relief at three months, with a zero percent transfusion rate and significantly lower rates of ejaculatory dysfunction and incontinence for Aquablation therapy.
• Aquablation therapy has demonstrated low rates of irreversible complications (urinary incontinence, erectile dysfunction, ejaculatory dysfunction) compared to published rates for other resective surgeries (e.g., erectile dysfunction as high as 14% for TURP, 20% for PVP, 8% for laser enucleation; ejaculatory dysfunction as high as 89% for TURP, 50% for PVP, 77% for laser enucleation; incontinence as high as 2% for TURP, 2% for PVP, 33% for laser enucleation).
• A key study published in April 2021 of 2,089 men undergoing Aquablation therapy observed a transfusion rate of only 0.8%, which is favorable compared to simple prostatectomy transfusion rates as high as 25%.

Management Changes

Corporate Governance

Legal Proceedings

• The company is not presently a party to any legal proceedings that, in the opinion of management, would have a material adverse effect on its business.
• The company may become involved in future legal proceedings relating to patent and other intellectual property matters, product liability claims, employee claims, tort or contract claims, federal regulatory investigations, and securities class action lawsuits.

Related Party Transactions

• The company has a license agreement with AquaBeam LLC, entered into in September 2019, granting a worldwide, exclusive, sublicensable, royalty-free license under certain patents in the field of urology. No payments (except for patent prosecution and maintenance costs) have been made or are otherwise required under this agreement.

Stakeholder Impact

• Shareholders face potential dilution from future equity issuances and rely on stock price appreciation for returns, as no dividends are planned. The market price of common stock may be volatile.
• Employees benefit from comprehensive compensation, benefits, health and wellness programs, and professional growth opportunities, but the company faces risks in attracting and retaining key talent.
• Customers (hospitals, surgeons, patients) benefit from the efficacy and safety of Aquablation therapy and access to new technologies like the HYDROS system. However, they face risks related to product liability, cost-containment efforts, and potential product recalls.
• Suppliers, particularly single-source providers, are critical to the company's manufacturing, and disruptions could impact product availability.
• Creditors, specifically Canadian Imperial Bank of Commerce, have a secured loan facility with covenants, and the company's ability to meet these covenants is crucial.

Next Steps

• Continue to increase the direct team of capital sales representatives to drive system placement within hospitals.
• Expand the team of Aquablation representatives and clinical specialists to drive system utilization.
• Continue to publish clinical data and present at industry conferences to increase awareness.
• Sponsor peer-to-peer education programs and workshops.
• Leverage successes in active discussions with private payors to establish additional positive national and regional coverage policies.
• Support new clinical studies aimed at advancing commercial, regulatory, and reimbursement efforts.
• Invest in two single-arm prostate cancer clinical trials (PRCT001, PRCT002) and one randomized FDA approved pivotal IDE clinical trial (WATER IV PCa).
• Develop additional and next-generation technologies to support and improve Aquablation therapy.
• Leverage treatment data and software development capabilities to integrate artificial intelligence and machine learning.
• Invest in marketing initiatives directed at primary care physicians to expand networks for BPH patients to visit a urologist.
• Potentially increase patient awareness through direct-to-patient marketing initiatives once a broader install base is established.
• Strategically invest in new international markets based on market size, opportunity, and prospects for compelling reimbursement.
• The company will continue to analyze historical stock price volatility and expected term assumptions as more historical data for its common stock becomes available.
• The company is evaluating the impact of ASU 2024-03 on its financial statement disclosures.
• The company is evaluating the impact of ASU 2025-06 on its financial statement disclosures.

Key Dates

Recommendation

PROCEPT BioRobotics demonstrates robust revenue growth and an improving gross margin, driven by increasing adoption of its innovative Aquablation therapy and the launch of its next-generation HYDROS system. The favorable reimbursement landscape and strong clinical evidence are significant tailwinds. However, the company continues to incur substantial net losses and has a significant accumulated deficit, indicating it is still in a heavy investment phase. Dependence on single-source suppliers and intense competition also present notable risks. A "hold" recommendation reflects the promising growth trajectory and product differentiation, balanced against the ongoing profitability challenges and operational risks inherent in a rapidly evolving medical technology market. Investors should monitor progress towards profitability and successful mitigation of supply chain and competitive pressures.

Keywords

Surgical robotics, BPH treatment, Aquablation therapy, HYDROS Robotic System, Prostate health, Medical devices, FDA clearance, Financial results, Revenue growth, Net loss, Clinical trials, Intellectual property, Healthcare regulation, Corporate governance, PRCT