Iridex Corp (IRIX) reports steady Q1 2026 performance with $11.8M revenue and 14% growth in Glaucoma probes. Full-year guidance reaffirmed.
Key Takeaways
- Total revenues for Q1 2026 were $11.8 million, essentially flat compared to $11.9 million in Q1 2025.
- Glaucoma probe revenue increased by 14% year-over-year, reaching $3.6 million.
- Adjusted EBITDA for the quarter was $0.3 million, down from $0.4 million in the same quarter last year.
- The company reaffirmed its full-year revenue guidance at $51 million to $53 million, representing a 1% to 5% pro forma growth compared to 2025.
- Cash and cash equivalents at the end of the quarter stood at $4.6 million, reflecting a decrease of $1.4 million from the previous quarter.
Financial Performance
In the first quarter of 2026, Iridex Corp reported total revenues of $11.8 million, which aligns with the company's expectations but shows a slight decline from $11.9 million in Q1 2025. The revenue decline was primarily attributed to a decrease in Retina system sales, though this was partially offset by an increase in Glaucoma probe sales, which totaled $3.6 million, marking a notable 14% growth year-over-year.
Gross profit for the quarter reached $4.7 million, translating to a 40% gross margin—a decline from the 43% gross margin reported in the previous year. This decrease was mainly due to rising overall manufacturing costs, including increased product costs from recent tariff developments. However, the company saw a sequential improvement of 300 basis points compared to the previous quarter's gross margins.
Operating expenses were reduced to $5.1 million, a 4% decrease from $5.3 million in Q1 2025. This reduction was driven by lower general and administrative costs, which benefitted from the General Administrative Transfer Initiative implemented in prior periods. The company reported a loss from operations of $0.3 million, slightly increased from $0.2 million in the same period last year. Notably, the net loss was $0.5 million, or $0.03 per share, improving from a net loss of $1.7 million or $0.10 per share in Q1 2025.
Strategic Initiatives
Iridex Corp's strategic initiatives focus on two main areas: enhancing Glaucoma treatment and expanding its Retina portfolio. The company has been actively utilizing its MedScout platform for targeted outreach, concentrating on both existing G6 system users and high-volume facilities that are not yet performing micropulse procedures. Management emphasized education as a critical strategy to encourage early treatment of glaucoma patients.
The introduction of the Medicare Local Coverage Determination (LCD) last year is expected to create favorable conditions for the company, facilitating an expanded target market and earlier adoption of G6 therapies among mild to moderate glaucoma patients. Management also highlighted their commitment to pricing discipline, which supported Q1 performance through increased average selling prices (ASP) on both probes and systems in the U.S.
In the Retina segment, a significant partnership with IPRO GPO was announced, aimed at expanding access to the company's laser portfolio across more than 1,800 member practices in the U.S. This partnership is expected to drive additional placements for Retina systems in the upcoming quarters. The company also remains focused on navigating regulatory challenges in various international markets, including Europe and Asia.
Future Outlook
Looking ahead, Iridex Corp has reaffirmed its revenue guidance for 2026, projecting total revenues between $51 million and $53 million. This projection excludes revenues from the Middle East region due to ongoing geopolitical tensions and is estimated to represent a 1% to 5% growth compared to 2025. The management team expressed confidence in achieving positive cash flow for the fiscal year, driven by improved revenue generation and cost management strategies.
As the company moves through 2026, it aims to capitalize on its growing installed base of G6 systems to drive incremental probe utilization. Management also indicated that the company is well-positioned to address international market opportunities once regulatory hurdles are cleared, particularly in Europe and Asia.
In terms of operational efficiency, the company anticipates further improvements as it transitions to lower-cost contract manufacturers, which should enhance gross margins moving forward. The company also reiterated that Q1 typically represents the lowest revenue quarter of the year, with expectations for stronger performance in the second and fourth quarters.
Overall, Iridex Corp remains committed to executing its strategic priorities and navigating the challenges of the current market environment. With a solid foundation established in Q1, the company appears poised for sustainable growth as it focuses on driving product adoption and improving operational efficiencies.
In summary, while the company faced some headwinds in Q1 2026, its strategic initiatives, strong management focus, and reaffirmed guidance suggest positive momentum for the remainder of the year.
This analysis is based on public earnings call materials and is not investment advice.
