Venus Concept(VERO -1.64%) reported second quarter 2025 results on Aug. 14, 2025, highlighting $15.7 million in GAAP revenue for Q2 2025, down 5% year-over-year, a GAAP operating loss of $9 million, and the announced $20 million all-cash sale of its Venus Hair business, announced June 6, 2025. The earnings call included details on sequential revenue stabilization, cost discipline measures, balance sheet restructuring, and strategic focus toward core U.S. aesthetics, with guidance withheld due to ongoing uncertainties and strategic reviews.

Venus Concept sells Venus Hair unit

The all-cash divestiture of Venus Hair, expected to close in 2025, follows a period of underperformance and a strategic review initiated to maximize shareholder value. The $20 million transaction, subject to an internal reorganization, is with Meta Health Group, which will provide the strategic investment resources needed to maximize the global addressable markets for the ARTAS and NeoGraft technologies.

"On June 6, we announced a definitive agreement to sell the Venus Hair business to MHG Company Limited or Meta Health Group in an all-cash transaction valued at $20 million. This transaction represents the first outcome of our evaluation of strategic alternatives to maximize shareholder value. Importantly, we believe this transaction strengthens Venus Concept by allowing us to focus our global medical aesthetics business, which we expect will improve revenue growth, lower operating expenses, enhance the cash flow profile of the business, and accelerate the path to long-term sustainable profitability and growth."
— Rajiv De Silva, Chief Executive Officer

This strategic sale enables Venus Concept to focus its global medical aesthetics business, which management expects will improve revenue growth, lower operating expenses, enhance the cash flow profile, and accelerate progress toward long-term sustainable profitability and growth.

Venus Concept grows U.S. revenue

Despite an 18% year-over-year decline in international revenue, Venus Concept achieved 15% quarter-over-quarter GAAP revenue growth in Q2 2025, driven by robust U.S. performance and a 20% sequential increase in total systems and subscription revenue. Cash system sales in the U.S. rose to 65% of total system sales, up from 58% last year.

"Importantly, the sequential growth performance in the second quarter was consistent with the expectations outlined on our first quarter call. Sequential growth was driven by mid-teens growth in both the U.S. and international markets and was fueled primarily by 20% growth in total systems and subscription revenue."
— Rajiv De Silva, Chief Executive Officer

The shift toward higher-quality cash system sales in the U.S. signals a more sustainable revenue mix and supports the company’s long-term profitability strategy.

Margin pressure impacts Venus Concept

Gross margin (GAAP) contracted to 60.1%, falling 11.4 percentage points year-over-year due to adverse sales mix and production disruptions from the Israel-Iran conflict, while a 6% increase in operating expenses further impacted GAAP profitability. The company accelerated debt extinguishment, executed a $17.5 million note-for-preferred-stock swap with its primary lender, and raised $3.9 million from equity issuances to shore up the balance sheet, closing the quarter with $4.9 million in cash and $34.3 million in total debt versus $39.7 million at December 31, 2024 (all figures GAAP).

"Gross margin was 60.1% of revenue compared to 71.5% of revenue for 2024. The decrease in gross margin is primarily attributable to the supply disruptions noted above resulting in an adverse sales mix due to the shortages of higher margin devices and to a lesser extent higher device system cost of goods sold tracing to manufacturing overheads spread over a lower volume base."
— Domenic Della Penna, Chief Financial Officer

The persistent margin compression exposes Venus Concept to short-term financial risk and heightens dependence on successful cost controls, debt restructuring, and timely strategic actions to restore profitability.

Looking Ahead

Venus Concept withheld full-year 2025 financial guidance due to unsettled discussions with lenders, market volatility, and the ongoing portfolio review process. Management announced plans for a new body device launch in early 2026 and indicated continued cost containment, targeted investment, and active exploration of strategic alternatives. No specific quantitative projections or milestones were disclosed.