NovaBay Pharmaceuticals Reports 9% Increase in Eyecare Segment Revenue - InvestingPro Analysis
NovaBay Pharmaceuticals, Inc. (NYSE American: NBY) has announced a 9% rise in net revenue for its eyecare segment in the second quarter and first half of 2024, compared to the same periods in 2023. The company's preliminary net revenue for the second quarter is $2.4 million, and $5.0 million for the half-year, with expectations for full-year revenue to reach $10 million.
The growth is primarily driven by increased sales of Avenova-branded products through online channels like Amazon and Avenova.com. NovaBay's CEO, Justin Hall, credits the company's digital marketing strategies for this success, with a 16% increase in Avenova subscribers on Amazon in the first half of 2024, and a remarkable 123% rise since 2022.
The subscriber base, accounting for 23% of all online Avenova revenue in the first half of the year, plays a crucial role in driving consistent sales and contributing to NovaBay's overall success. The positive reception of Avenova products in the U.S. dry eye market is reflected in a 4.5-star average rating from over 14,000 customer reviews across online platforms.
NovaBay offers a range of products for dry eye treatment, including Avenova Lid & Lash Solution, lubricating eye drops, a warm eye compress, and the i-Chek for eyelid health monitoring. The company has also introduced the Avenova Allograft, an amniotic tissue product available through eye care professionals.
Additionally, NovaBay has filed a registration statement with the U.S. Securities and Exchange Commission for a proposed securities offering, pending effectiveness.
Despite reporting record sales for its Avenova products, NovaBay incurred a net loss of $3.6 million for the quarter, while maintaining a steady gross margin of 68% and reducing sales and marketing expenses by half. The company has also entered into a co-marketing agreement with Eyenovia and plans to convert physician-dispensed channel customers to over-the-counter sales, particularly through Amazon.
InvestingPro Insights reveal that NovaBay's revenue for the last twelve months as of Q1 2024 was $15.02 million, showing a year-over-year growth of 11.49%. While the company's gross profit margin remains strong at 53.86%, it faces challenges with an operating income margin of -34.82%.
Investors should exercise caution as NovaBay's stock has experienced a significant decline in the last six months, with a 63.35% drop in its six-month price total return. Analysts do not anticipate profitability this year, contributing to a recent price total return of -22.91%.
For those considering an investment in NovaBay Pharmaceuticals, InvestingPro offers valuable insights and tips to make an informed decision. With the next earnings date scheduled for August 9, 2024, stakeholders and potential investors will be monitoring closely to see if NovaBay's strategies lead to improved profitability and a turnaround in stock performance.