10-K: Zomedica Reports 17% Revenue Growth Amidst Delisting and Impairment

Zomedica Corp. reported a 17% increase in revenue to $32.03 million for fiscal year 2025, alongside a significant net loss of $81.86 million driven by impairment charges following its delisting from NYSE American.

Summary

• Revenue for the fiscal year ended December 31, 2025, increased by 17% to $32.03 million, up from $27.29 million in 2024.
• The company reported a net loss of $81.86 million for 2025, a 74% increase from the $46.98 million net loss in 2024, primarily due to significant impairment expenses.
• Gross profit margin decreased to 68% in 2025 from 70% in 2024, influenced by higher depreciation and manufacturing costs.
• Operating expenses included $24.50 million in general and administrative expenses (down 17%), $7.17 million in research and development (down 1%), and $18.54 million in selling and marketing (up 8%).
• Impairment expense totaled $55.83 million in 2025, primarily from goodwill ($45.56 million), amortizable intangible assets ($8.30 million), and property and equipment ($1.98 million), triggered by a significant decline in market capitalization after delisting from NYSE American.
• Cash used in operating activities decreased by 25% to $17.65 million in 2025 from $23.63 million in 2024.
• The company's common shares were delisted from NYSE American on March 4, 2025, and began trading on the OTCQB Market under the symbol ZOMDF on March 5, 2025.
• Zomedica launched several new products and assays in 2024 and 2025, including VETGuardian PLUS, TRUVIEW digital microscopy platform, VETIGEL hemostatic gel, and new TRUFORMA assays for equine and feline diagnostics.
• The company maintains a strong intellectual property portfolio with 57 issued U.S. patents and 100 issued international patents, plus numerous pending applications.
• As of December 31, 2025, Zomedica had working capital of $54.59 million and total shareholders' equity of $115.40 million.

Sentiment

Score: 3

Explanation: StockSavvy.ai views this as a negative report due to the substantial increase in net loss driven by significant impairment charges and the delisting from NYSE American, despite revenue growth and operational improvements in cash flow.

Positives

• Revenue increased by 17% to $32.03 million in 2025, demonstrating continued sales growth.
• Cash used in operating activities decreased by 25% to $17.65 million, indicating improved operational efficiency in cash management.
• Successful launch of VETGuardian PLUS, TRUVIEW digital microscopy platform, and VETIGEL hemostatic gel, expanding the product portfolio.
• Introduction of 18 new assays for the TRUFORMA platform, including the first for equine diagnostics, enhancing product utility and market reach.
• Achieved ISO 13485 certification for manufacturing and distribution operations in Roswell, Georgia, and Plymouth, Minnesota, signifying quality management.
• Expanded manufacturing and distribution capabilities with a Global Manufacturing & Distribution Center in Roswell, Georgia, and an R&D, manufacturing, and distribution center in Plymouth, Minnesota.
• Positive outcomes from clinical studies for PulseVet shock wave therapy in treating equine EIPH (76% improvement) and asthma (77% improvement) with no adverse events.
• General and administrative expenses decreased by 17% due to lower professional fees, wages, amortization, and rent.
• The company believes existing cash is sufficient to fund expected short-term and long-term operational requirements.

Negatives

• Net loss significantly increased by 74% to $81.86 million in 2025, primarily due to substantial impairment charges.
• The company's common shares were delisted from NYSE American on March 4, 2025, due to trading at a low price per share, moving to the OTCQB Market.
• Incurred $55.83 million in non-cash impairment charges in 2025, including $45.56 million for goodwill, $8.30 million for intangible assets, and $1.98 million for property and equipment, triggered by the market capitalization decline post-delisting.
• Gross profit margin decreased from 70% in 2024 to 68% in 2025.
• Accumulated deficit grew to $299.77 million as of December 31, 2025, and the company expects to continue incurring losses for the foreseeable future.
• Total shareholders' equity decreased from $195.66 million in 2024 to $115.40 million in 2025.
• Available-for-sale securities decreased from $64.33 million in 2024 to $44.24 million in 2025.
• The company believes it could be classified as a Passive Foreign Investment Company (PFIC) for the current and future taxable years, which could subject U.S. investors to materially adverse U.S. federal income tax consequences.

Risks

• The company is a development-stage company, has not yet become profitable, and expects to continue incurring losses for the foreseeable future.
• Unproven markets for existing and future products in the animal diagnostic and medical device sectors, with no assurance of successful commercialization or market acceptance.
• The animal care industry is characterized by rapid technological changes, frequent new product introductions, and evolving standards, which could render products obsolete.
• Significant competition from larger companies with substantially more financial, technical, and human resources, and established marketing and sales organizations.
• Risks associated with public health crises (e.g., pandemics) that could disrupt operations, supply chains, and customer demand.
• Adverse macroeconomic conditions (e.g., inflation, recession, geopolitical conflict) could negatively affect demand for products and impact suppliers, logistics providers, and distributors.
• Disruptions in the global supply chain, including increased costs and delays in obtaining components (e.g., Palladium from Russia/Ukraine), could impair manufacturing and customer satisfaction.
• Dependence on third-party suppliers and manufacturers, including sole or single sources, poses risks of supply interruptions, inconsistent quality, and increased costs.
• Reliance on strategic relationships and license agreements (e.g., for Assisi Loop, VETIGEL, VETGuardian) means the company does not own underlying intellectual property and is subject to terms and potential termination.
• Failure to attract and retain senior management and key scientific personnel could hinder product development and commercialization efforts.
• Inability to manage growth successfully could strain financial, operational, and managerial resources.
• Security breaches, data loss, and other disruptions could compromise sensitive information, expose the company to liability, and damage its reputation.
• Damage to reputation from negative publicity, whether true or not, especially with increased social media usage.
• As a smaller reporting company, reduced disclosure obligations may adversely affect investor insights and decision-making.
• Severe weather events and climate change could impact operations, increase costs, and affect demand for products and insurance availability.
• Failure of Qorvo to provide BAW sensors could lead to delays or inability to manufacture TRUFORMA cartridges.
• Failure to realize anticipated growth opportunities from acquisitions (SMP, QBT) or assumption of unknown liabilities from these acquisitions.
• Various government regulations, including post-market oversight by USDA-CVB and FDA-CVM, and international laws, could limit or delay product development and commercialization.
• Limited ability to obtain intellectual property protection for products, and risks of not avoiding claims of infringement on others' IP rights.
• The market price of common shares is expected to fluctuate substantially, influenced by various factors including product delays, competition, and general economic conditions.
• The company's Articles of Amalgamation authorize the issuance of an unlimited number of common and preferred shares, potentially diluting existing shareholders.
• The company does not intend to pay dividends, so return on investment depends on share price appreciation.
• Cash-settled Stock Appreciation Rights (SARs) liability creates volatility in financial results due to fair value remeasurement.
• Ability to use U.S. and Canadian Net Operating Losses (NOLs) is limited by ownership changes (Section 382 of the Code) and the ability to generate future taxable income.
• The company believes it may be classified as a Passive Foreign Investment Company (PFIC), which could result in adverse U.S. federal income tax consequences for U.S. investors.

Future Outlook

The company expects to continue incurring losses for the foreseeable future, but anticipates these losses will decrease from historical levels as the Therapeutic Device segment rapidly grows, Diagnostic products are commercialized, and product development and sales/marketing efforts expand. The company intends to leverage its infrastructure and commercial capabilities to grow existing products, launch new complementary products, acquire new products, and capitalize on development services to achieve profitability as expeditiously as possible. Research and development expenses are expected to increase as the company maintains and enhances current product lines and develops new ones. Selling and marketing expenses are also expected to increase in line with product expansion and commercialization efforts.

Management Comments

• Our mission is to enrich the lives of the animals we love and the veterinarians that care for them by providing products and technologies that improve patient care and enhance the economic health of veterinary practices.
• We also strategically leverage our existing manufacturing and engineering capabilities to provide development services beyond animal health.
• Our goal is to deliver innovative diagnostic and therapeutic technologies to veterinarians that improve the quality of care for the pet and the satisfaction of the pet parent, as well as the workflow, cashflow and profitability of the veterinarians practice.
• Our intent is to leverage this infrastructure and commercial capability to continue to grow our existing products, launch new products complementary to our existing products, acquire new products to market to veterinarians and pet parents through their preferred method of purchasing, and capitalize on opportunities to leverage our internal capabilities to provide development services to provide a straightforward pathway to profitability for the Company as expeditiously as possible.
• We are continuing to invest in the development of additional assays which we believe will increase the utility of the TRUFORMA platform for our customers over time.
• For the foreseeable future, we expect to continue to incur losses, which we expect will begin to decrease from historical levels as we continue to rapidly grow our Therapeutic Device segment, continue the commercialization of our Diagnostic products, and expand our product development and sales and marketing activities.
• We expect revenue to increase in subsequent periods as we increase our sales, marketing, and commercialization efforts.
• We anticipate that cost of revenue will continue to increase in future periods in line with the expected growth in unit sales.
• While we expect general and administrative expenses to increase, we expect it to decrease proportionally relative to sales and related product expansion.
• We anticipate that research and development expense will increase as we maintain and enhance our current product lines and continue to develop new products.
• We expect future selling and marketing expense to increase in line with product expansion and growth in our commercialization efforts.
• We expect to continue recording net losses in future periods until we have sufficient revenue from product sales to offset our operating expenses.
• We believe that our existing cash is sufficient to fund our expected short-term needs (defined as the next twelve months).
• We believe that our existing cash resources will be sufficient to fund our expected operational requirements for the long-term period (defined as beyond the next twelve months).

Industry Context

StockSavvy.ai notes that Zomedica operates within the growing companion animal and equine healthcare markets, driven by trends such as pet humanization, premiumization of care, and increased veterinary visits. The global pet care industry is projected to more than double to $275 billion by 2030, with vet care and products making up a significant portion. The global equine healthcare market is also experiencing strong growth, expected to reach $1.6 billion by 2026. Zomedica's focus on innovative diagnostics and therapeutic devices, particularly point-of-care solutions and non-invasive therapies, aligns with industry trends emphasizing enhanced detection, faster results, and new treatment options. The company's strategy of leveraging acquisitions and internal R&D to expand its product portfolio and distribution channels is a common approach in this competitive sector, where major players like Idexx Laboratories, Antech Diagnostics, and Zoetis Inc. dominate. The delisting from NYSE American to OTCQB, however, places Zomedica at a disadvantage compared to its larger, exchange-listed competitors in terms of visibility and investor access.

Comparison to Industry Standards

• Zomedica's TRUFORMA platform offers assays for feline optimized TSH, canine endogenous ACTH, and canine Free T4, which are noted as the only assays of these types available at the point of care, potentially offering a competitive advantage over traditional reference lab services provided by companies like Idexx Laboratories and Antech Diagnostics.
• The TRUVIEW digital cytology platform is highlighted as the only system available that offers automated slide preparation within the instrument, differentiating it from competitors like Zoetis Imagyst, Heska's Element AIM, and Idexx Digital Cytology inVue Dx platform by reducing human error and staff time.
• The VETGuardian Zero Touch vital signs remote monitoring system is positioned as a unique offering with a current lack of direct competition in the veterinary solutions sector, providing contact-free, continuous monitoring unlike traditional wired systems.
• PulseVet electrohydraulic shockwave therapy, particularly with the X-Trode handpiece for small animals, aims to expand adoption beyond the equine market, where it is already used in approximately half of dedicated practices in the U.S., competing with laser devices from Companion Animal Health, K-Laser, and Summus Medical Laser, LLC, as well as Piezo Shockwave systems from ELvation Medical GmbH and Curative Sound.
• VETIGEL hemostatic gel, licensed from Cresilon, Inc., is marketed for its ability to stop bleeding in seconds without applied pressure, aiming to become a standard-of-care solution in veterinary wound management, competing in a market where rapid hemostasis is critical for procedural efficiency and patient outcomes.

Management Changes

Corporate Governance

Legal Proceedings

• As of December 31, 2025, and continuing as of March 16, 2026, the company is not aware of any pending or threatened material litigation claims against it.

Related Party Transactions

• The company holds a 19.50% equity stake in Brisby Inc. as of December 31, 2025, and has made $1.61 million in cash payments for milestones under a Development and License Agreement with Brisby Inc. The remaining cash payments of $1.89 million are due upon achievement of future development milestones and first commercial sales of Smart Pet Pad and Intelligent Pet Bed.

Stakeholder Impact

• **Shareholders:** Experienced significant dilution risk due to the authorization of an unlimited number of common and preferred shares, and the delisting from NYSE American to OTCQB may reduce liquidity and investor confidence. The increased net loss and impairment charges negatively impact shareholder equity.
• **Employees:** The company emphasizes providing a thriving environment with competitive compensation, equity incentive plans, and comprehensive benefits, aiming for attraction and retention. However, the overall financial losses and delisting could create uncertainty.
• **Customers (Veterinarians & Pet Owners):** Benefit from expanded product portfolio, new diagnostic assays, and therapeutic devices aimed at improving patient care, workflow, cashflow, and profitability for practices. New products like VETGuardian PLUS and TRUVIEW AI capabilities enhance offerings.
• **Suppliers & Partners:** Dependence on third-party suppliers and strategic partners (e.g., Qorvo for BAW sensors, Cresilon for VETIGEL) means their performance and continuity are critical to Zomedica's operations. Supply chain disruptions could impact these relationships.
• **Creditors:** The accumulated deficit and continued losses indicate ongoing financial challenges, though the company believes existing cash is sufficient for short-term and long-term needs.

Next Steps

• Continue to grow existing products and launch new products complementary to the current portfolio.
• Acquire new products to market to veterinarians and pet parents.
• Capitalize on opportunities to leverage internal capabilities to provide development services.
• Invest in the development of additional assays to increase the utility of the TRUFORMA platform.
• Expand the TRUFORMA menu of diagnostic offerings for small animal and equine veterinarians over the next several years.
• Build a steady stream of new assays to establish a consistent cadence of launches for the TRUFORMA instrument.
• Continue to explore additional programs to accelerate uptake of PulseVet in the small animal market in 2026 and beyond.
• Expand the international distribution network and launch additional products into these channels in 2026 and beyond.
• Increase market awareness for VETIGEL through targeted educational initiatives, clinical demonstrations, case studies, and practitioner training programs.
• Integrate VETIGEL into surgical and emergency care protocols through direct sales force engagement.
• Evaluate the impact of recently issued accounting standards (ASU 2025-11, ASU 2025-06, ASU 2024-03) on consolidated financial statements.
• File the proxy statement for the 2026 annual meeting of shareholders within 120 days after December 31, 2025.

Key Dates

Recommendation

The company exhibits mixed signals. While Zomedica achieved notable revenue growth and improved cash flow from operations, the substantial increase in net loss due to significant impairment charges and the delisting from NYSE American to OTCQB are major concerns. The delisting reduces market visibility and liquidity, potentially limiting investor access. The company's strategic focus on new product launches and acquisitions in a growing market is positive, but the path to profitability remains uncertain, with continued losses expected. Given the significant risks associated with market volatility, competition, supply chain, and the PFIC classification, a 'hold' recommendation is appropriate. Investors should monitor the company's ability to execute its growth strategy, reduce losses, and manage its financial position effectively on the OTCQB market before considering further investment.

Keywords

Animal Health, Veterinary Diagnostics, Therapeutic Devices, TRUFORMA, PulseVet, VETGuardian, TRUVIEW, VETIGEL, SEC Filing, 10-K, Delisting, Impairment, Revenue Growth, Net Loss, OTC Markets, Companion Animals, Equine Health, Medical Devices, Biotechnology, Intellectual Property