TELA Bio, Inc. Common Stock 2026 Q2 Earnings Call
Review the key takeaways and the transcript of this earnings call.
- TELA Bio reported second quarter 2026 revenue of $19.3 million, a 4% decrease from Q2 2025, with the decline primarily in the plastic and reconstructive surgery (PRS) portfolio.
- Global hernia unit volumes grew 12% year over year, with dollar revenue up 6.6%, indicating procedural share gains despite a market shift toward smaller units and robotic repairs.
- International revenue increased 26% year over year to $3.8 million, driven by growth in the UK and other European markets, where growth comes solely from the hernia portfolio.
- Gross profit was $13.9 million with a 72% gross margin, slightly improved from 70% in Q2 2025 due to tariff refunds and lower inventory charges.
- Operating expenses were flat at $23.2 million year over year, with sales and marketing expenses slightly lower by $400,000 and R&D expenses up by $500,000.
- Loss from operations was $9.3 million, slightly worse than $9.1 million in Q2 2025, and net loss increased to $11.3 million from $9.9 million, mainly due to higher interest expense from a new credit facility.
- The company ended Q2 2026 with $30.4 million in cash and cash equivalents.
- Leadership changes included Heather Goetz appointed as CEO and director, succeeding founder Tony Koblish.
- The PRS portfolio underperformed due to longer ramp-up time for new sales reps, a pilot program that caused sales confusion, and ongoing anti-competitive contracting practices in hospitals.
- Management highlighted that the hernia portfolio continues to perform well and that international markets remain a consistent growth source.
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Transcript
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Good afternoon, ladies and gentlemen, and welcome to the TELA Bio second quarter 2026 earnings conference call. At this time, all participants are in listen-only mode. Following the prepared remarks, there will be a question and answer session. Please be advised that today's conference is being recorded. I will now like to turn the conference over to Louisa Smith.
Thank you, Louisa, and good afternoon, everyone. Earlier today, TELA Bio released financial results for the second quarter ended June 30, 2026. A copy of the press release is available on the company's website. Joining me on today's call are Joseph Capper, Chairman of the Board, Heather Getz, Chief Executive Officer, Jeff Blizard, President, Roberto Cuca, Chief Operating Officer and Chief Financial Officer, and Jim Hagen, Senior Vice President of Strategic Operations and Marketing. Before we begin, I'd like to remind you that during this conference call, the company may make projections and forward-looking statements regarding future events. We encourage you to review the company's past and future filings with the SEC, including, without limitation, the company's quarterly reports on Forms 10-Q, which identify the specific risk factors that may cause actual results or events to differ materially from those described in these forward-looking statements.
These factors may include, without limitation, statements regarding product development, pipeline opportunities, sales and marketing strategies, and the impact of various additional risk factors as identified in our regulatory filings. With that, I'll now turn the call over to Joe.
Thank you, Louisa. Good afternoon, and thank you for joining TELA Bio's second quarter 2026 earnings call. I will start the call with a few comments about the important leadership change announced last week, naming Heather Getz as the new Chief Executive Officer and Director of TELA Bio, then turn the call over to the management team for an update on the business. Heather brings a proven track record of driving operational excellence, leading organizations through complex business and financial transformations, and creating long-term value. We are confident that under Heather's leadership, TELA Bio will build on its strong foundation, expand its impact for patients and surgeons, and deliver value for our shareholders and employees.
On behalf of the board, I also want to extend our sincere gratitude to Antony Koblish for his vision, leadership, and entrepreneurial spirit in founding TELA Bio and guiding the company through its early growth stage. Antony's commitment to innovation led to the development of OviTex and helped establish TELA Bio as a leader in soft tissue reconstruction. We are deeply appreciative of his many contributions and wish him continued success in his future endeavors. I will now turn the call over to Heather.
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