Nephros, Inc. (Nasdaq: NEPH), a leader in water technology, has announced its financial results for the third quarter ended September 30, 2024, achieving its first profitable quarter with net income of $0.2 million, a notable improvement from a net loss of $0.2 million in the same period last year. This milestone reflects the company's enhanced operational efficiency and strategic focus on profitability.
The company reported net revenue of $3.5 million for Q3 2024, an 8% increase over Q2 2024, despite a 6% decrease compared to Q3 2023. Robert Banks, President and CEO of Nephros, highlighted the significance of this achievement, stating the company's pursuit of operational excellence is yielding positive results, including positive adjusted EBITDA for both the quarter and the first nine months of 2024.
Improvements in gross margins to 61% in Q3 2024, up from 59% in Q3 2023, and a reduction in selling, general, and administrative expenses to $1.7 million from $2.1 million, underscore the company's effective cost management strategies. However, challenges such as underperformance in the South Central region and slower ordering patterns from larger accounts have been noted.
In response, Nephros is launching digital support for filter installation and expanding service capabilities to enhance customer compliance and filter sales. These initiatives, along with a focus on expense management, have contributed to an adjusted EBITDA of $295,000 for Q3 2024, a significant increase from $11,000 in the same period of 2023.
Despite a decrease in cash and cash equivalents to $2.5 million as of September 30, 2024, from $4.3 million at the end of 2023, due to operational losses and investments, the company's achievement of profitability in a challenging economic environment signals a strong potential for future growth and market positioning in the water technology sector.
For more information on Nephros, Inc., visit https://www.nephros.com. The company's strategic initiatives and operational improvements are setting the stage for sustainable profitability and expansion, making its Q3 2024 results a key indicator of its future trajectory in the industry.
