<div id="readability-page-1">Avita Medical NASDAQ: RCEL executives told investors they are focused on making the business more predictable and execution-driven in 2026, following what they described as a headwind-heavy 2025 that included reimbursement disruption, a sales force reconfiguration, and repeated amendments tied to revenue covenants under a prior credit facility.<div>Get Avita Medical alerts:</div><h2>2026 outlook: “progressive” growth and tighter forecasting</h2> Chair and interim CEO Cary described the company’s fourth-quarter priorities as centered on disciplined execution across cash management, headcount, quota-setting, and forecasting. He said the company’s objective is “progressive revenue growth” in 2026, supported by what he called a bottoms-up view of quarterly performance. Management guided to 2026 revenue of $80 million to $85 million, which Cary said reflects expected quarter-over-quarter growth. The company finished 2025 with $71.6 million in revenue, including $17.6 million in the fourth quarter, following a $17.0 million third quarter. Cary characterized recent quarters as stable and noted that fourth-quarter orders did not include large or bulk orders. Cary said the company grew about 11% in 2025 despite disruptions, and expects 12% to 19% growth in 2026. Finance leader David added that Avita has historically grown at a compound annual growth rate of about 32%, and said management’s goal is to return to growth “somewhere north of 20%,” with longer-term aspirations in the 20% to 30% range. <h2>Margins, operating expense reductions, and cash use</h2> David said gross margin was 82.1% for 2025 and 81% in the fourth quarter. He attributed the year’s results to inventory reserves booked during the year that he said would not recur, as well as a continuing product-mix impact tied to revenue-sharing arrangements for newer products. He noted that Cohealyx and PermeaDerm include partner revenue-share economics, describing a 50/50 ASP split for Cohealyx and a 60/40 split for PermeaDerm. As those products scale, management expects some margin impact, though David said the company expects RECELL products to grow faster in 2026. He guided to 83% to 85% gross margin for 2026, citing RECELL product margins around 86%. On expenses, David said Avita removed about $2.5 million per quarter beginning in the second quarter of last year and eliminated $10 million annually across the sales organization, G&amp;A, and R&amp;D following a commercial transformation. Fourth-quarter operating expenses were $24.7 million, including about $1.2 million of one-time severance; he said normalized operating expenses are expected to be $23 million to $24 million, including roughly $3 million of non-cash items such as stock-based compensation. David also highlighted reduced quarterly cash use, from $10.1 million earlier in 2025 to $5.1 million in the fourth quarter. He warned of an uptick in the first quarter due to employee benefits resets, payroll taxes, and bonus payments, but said management expects cash use to trend down as revenue grows, with an eventual move toward cash flow break-even. The company did not provide timing guidance for break-even. <h2>Reimbursement update and a revamped sales focus</h2> Cary said reimbursement disruption was a key issue in 2025, and updated investors on Medicare Administrative Contractor (MAC) rate publications. He said six of seven MACs have now published rates, and he expects the remaining contractor to publish after engagements with representatives in the covered states. In response to a question about standardized Medicare payment rates for chronic wound care, Cary said the referenced change was primarily relevant to chronic wounds, while RECELL is reimbursed under CPT codes and the company has been navigating physician payment through the MAC process. Operationally, Cary reiterated that Avita reduced the size and cost of its sales force while repositioning representatives geographically. He said the company is focused on 200 key accounts, including 120+ burn centers and 50–60 Level 1 trauma centers, with the intent to concentrate on utilization growth within accounts where relationships already exist. <h2>Three-product platform: utilization and adoption through VAC reviews</h2> Cary emphasized the company’s “three-product platform,” consisting of RECELL, RECELL GO, Cohealyx, and PermeaDerm, and said the commercial goal is to expand RECELL usage by case type and wound size, increase the number of using physicians inside existing accounts, and track utilization as a key internal metric. For the newer products, he said adoption often requires Value Analysis Committee (VAC) review. He stated that approximately 55 accounts currently have Cohealyx in a VAC process, which he said typically takes two to five months. He added that Avita is seeing roughly “about a dozen” accounts come out of VAC each quarter, though he said timing varies. Cary said RECELL does not require VAC review at this point, describing it as already completed. Management also discussed two ongoing 40-patient post-market studies—one each for Cohealyx and PermeaDerm—which Cary said are expected to publish toward the end of the year but are already being used commercially in presentations and sales discussions. <h2>New credit facility resets covenants; vitiligo deprioritized</h2> David said Avita replaced its prior OrbiMed credit facility—entered into in 2023 and burdened by what he described as unachievable revenue covenants—with a new agreement led by Perceptive Advisors. The company entered into a $60 million facility and drew $50 million at close. He said the purpose was to “reset the revenue covenants” and reduce recurring amendments and waivers that created distraction in 2025. He cited examples including a first-quarter 2026 trailing twelve-month revenue covenant of $68.5 million and a full-year 2026 revenue covenant of $73 million, which he said is below the company’s 2026 guidance range. The facility also lowered the cash covenant from $10 million to $5 million. David said the transaction added about $6 million net to the balance sheet, but described that as not the primary objective. In the Q&amp;A, Cary said Avita has deprioritized its vitiligo commercial effort despite FDA approval for stable vitiligo, citing reimbursement as “uncertain” and “too low” to justify prioritizing a broader go-to-market push until economics improve. Management also said it is not seeking an acquisition, with Cary stating the company is focused on building value as an independent business and is “not interested” in M&amp;A discussions.<h2>About Avita Medical NASDAQ: RCEL</h2>Avita Medical, Inc NASDAQ: RCEL is a regenerative medicine company focused on the development and commercialization of cell‐based therapies for acute and chronic wounds. Its flagship technology, the ReCell® Autologous Cell Harvesting Device, enables clinicians to create a suspension of a patient's own skin cells at the point of care. The system is designed to accelerate wound healing, minimize donor‐site requirements and reduce scarring for patients suffering from burns, traumatic wounds and a variety of surgical and reconstructive procedures. Founded in 2009 and headquartered in Carlsbad, California, Avita Medical has secured regulatory clearances in key markets, including CE mark approval in the European Union and 510(k) clearance from the U.S.<h2>Featured Articles</h2><ul><li>Five stocks we like better than Avita Medical</li><li>VWAV: Riding the Defense Surge</li><li>Elon Musk: This Could Turn $100 into $100,000</li><li>Silver paying 20% dividend. Plus 68% share gains</li><li>America’s 1776 happening again</li><li>What Expenses Can Be Deducted From Capital Gains Tax This Year?</li></ul>This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.<h2>Should You Invest $1,000 in Avita Medical Right Now?</h2>Before you consider Avita Medical, you'll want to hear this.MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Avita Medical wasn't on the list.While Avita Medical currently has a Hold rating among analysts, top-rated analysts believe these five stocks are better buys.View The Five Stocks Here </div>

RCEL

Avita Medical (NASDAQ:RCEL) aims for "progressive" growth in 2026, targeting revenue of $80M-$85M after a challenging 2025. The company faced reimbursement disruptions and a sales force reconfiguration, yet managed an 11% growth in 2025. Management expects 12%-19% growth in 2026, with a focus on disciplined execution and cash management. Gross margins are projected at 83%-85%, with reduced operating expenses. Avita is concentrating on 200 key accounts to enhance product utilization, particularly for its RECELL platform, while navigating reimbursement updates.

Avita Medical Targets “Progressive” 2026 Growth, Guides $80M-$85M Revenue After Headwind Year