SkinHealth Systems Inc.: Q1 FY2026 earnings call

What management said about Q1 FY2026, from the documents filed with the SEC on 7 May 2026: press release. Guidance figures: 1 lowered, 2 new, 1 kept. The quarter’s numbers.

Key takeaways

Net sales fell 6.7% year on year: Net sales were $64.9 million against $69.6 million, due to lower delivery systems and consumables net sales. Source
Adjusted EBITDA rose to $8.5 million: Adjusted EBITDA was $8.5 million, a 13.1% margin, against $7.3 million and a 10.4% margin a year earlier. Source
Consumables were most of net sales: Consumables were $46.4 million of $64.9 million in net sales for Q1 2026, against $49.4 million of $69.6 million a year earlier. Source
Operating expenses fell on personnel and marketing: Operating expenses were $46.2 million against $60.6 million; adjusted operating expenses were $38.4 million against $42.8 million. Source
Gross margin fell on amortization: Gross margin was 68.5% against 69.8%. The company attributed the decrease mainly to higher amortization expense, which was $2.1 million against $1.1 million in cost of sales. Source
Device sales under continued pressure: Management said the revised guidance reflects continued pressure on year-over-year device sales. Source
Cash balance fell to $204.4 million: Cash, cash equivalents and restricted cash were $204.4 million against $232.7 million at year-end. Operating activities used $(5.6) million against $3.0 million provided a year earlier. Source
Direct action to improve execution: Management said it is taking direct action to improve execution while continuing to invest in capabilities and innovation for long-term growth. Source

“First quarter results reflect the strength of the business. We delivered revenue within our guidance range, significantly outperformed on adjusted EBITDA, and continued to expand margins through disciplined execution.”
Pedro Malha, President and CEO of SkinHealth Systems

Guidance

Area	Period	Figure	Against last quarter
Net sales Source	Second quarter 2026	$72 - $77 million	New
Adjusted EBITDA Source	Second quarter 2026	$11 - $13 million	New
Net sales Source	Fiscal year 2026	$280 - $295 million	Lowered from $285 - $305 million
Adjusted EBITDA Source	Fiscal year 2026	$35 - $45 million	Kept

What changed from last quarter

Guidance lowered: Full-year 2026 net sales range cut to $280 - $295 million from $285 - $305 million. Adjusted EBITDA range unchanged. Source
New guidance: Second-quarter 2026 guidance given for net sales and adjusted EBITDA. The prior release had no second-quarter range. Source
Guidance kept: Full-year 2026 adjusted EBITDA range of $35 - $45 million kept from the prior release.
New: Company name changed from The Beauty Health Company (BeautyHealth) to SkinHealth Systems Inc. Source

Results and growth drivers

Net sales fell 6.7% year on year: Net sales were $64.9 million against $69.6 million, due to lower delivery systems and consumables net sales. Source
Net loss narrowed to $6.6 million: Net loss was $(6.6) million against $(10.1) million. The company attributed the change mainly to lower operational spend, partly offset by lower net sales. Source
Adjusted EBITDA rose to $8.5 million: Adjusted EBITDA was $8.5 million, a 13.1% margin, against $7.3 million and a 10.4% margin a year earlier. Source

Segments and regions

All three regions sold less: Americas net sales were $44.6 million against $46.3 million; APAC $6.6 million against $8.3 million; EMEA $13.7 million against $15.0 million. Source
Delivery systems sold by region: Delivery systems sold were 438 in the Americas against 550, 190 in EMEA against 214, and 118 in APAC against 98. Source
China sales moved to distributor: The company moved China sales to a distributor partner in the second quarter of 2025 and stopped direct sales to customers in China. Source

“While the market remains challenging and we are lowering our full-year revenue outlook, the fundamentals are intact.”
Pedro Malha, President and CEO of SkinHealth Systems

Products and customers

Consumables were most of net sales: Consumables were $46.4 million of $64.9 million in net sales for Q1 2026, against $49.4 million of $69.6 million a year earlier. Source
Consumables fell in APAC and EMEA: Consumables in APAC fell to $4.5 million from $6.4 million and in EMEA to $9.3 million from $9.9 million. Americas was $32.6 million against $33.1 million. Source
Delivery systems net sales declined: Delivery systems net sales were $18.5 million against $20.2 million, with Americas down $1.1 million. Source

Operating costs and expenses

Operating expenses fell on personnel and marketing: Operating expenses were $46.2 million against $60.6 million; adjusted operating expenses were $38.4 million against $42.8 million. Source
Litigation and restructuring costs fell: Litigation-related costs were $2.2 million against $6.9 million; Go-to-Market restructuring was $0.2 million against $2.7 million. Source
Depreciation and amortization totals: Depreciation was $0.6 million against $1.9 million, and amortization $4.8 million against $4.3 million. Severance and other was $0.5 million, with none a year earlier. Source

Gross margin and profit

Gross margin fell on amortization: Gross margin was 68.5% against 69.8%. The company attributed the decrease mainly to higher amortization expense, which was $2.1 million against $1.1 million in cost of sales. Source
Adjusted gross margin held near flat: Adjusted gross margin was 72.2% against 71.9%, described as relatively flat. Adjusted gross profit was $46.9 million against $50.0 million. Source
Gross profit declined with sales: Gross profit was $44.4 million against $48.6 million, on net sales $4.7 million lower. Source

Demand and device sales

Device sales under continued pressure: Management said the revised guidance reflects continued pressure on year-over-year device sales. Source
Second-quarter net sales guided higher: Q2 2026 net sales guidance of $72 - $77 million compares with the $64.9 million reported for Q1 2026. Source
Full-year net sales range lowered: The full-year net sales range was lowered by $5 million at the low end and $10 million at the high end. The adjusted EBITDA range was unchanged. Source

Capital, cash and debt

Cash balance fell to $204.4 million: Cash, cash equivalents and restricted cash were $204.4 million against $232.7 million at year-end. Operating activities used $(5.6) million against $3.0 million provided a year earlier. Source
Financing activities used $20.9 million: Net cash used for financing activities was $(20.9) million against $(0.3) million a year earlier. Investing activities used $(1.6) million. Source
Current convertible notes declined: Current convertible senior notes, net, were $102.9 million against $124.0 million. Non-current notes were $241.3 million against $240.4 million. Source

Strategy and execution

Direct action to improve execution: Management said it is taking direct action to improve execution while continuing to invest in capabilities and innovation for long-term growth. Source
Integrated platform described: The company describes an ecosystem of device technology, proprietary consumables and clinical validation, delivered through a network of providers. Source
Installed base and brand cited: Management cited installed base growth and the brand as current conditions in the company's position. Source

Coming up, as management said on 7 May 2026

Call recording posted later: A recording of the call will be posted on the investor site about three hours after it ends. Source

Figures management reported

Figure	Reported
Total delivery systems sold Source	746 (Q1 2025: 862)
Active install base Source	36,419 (Q1 2025: 35,014)

Risks management discussed

Demand: Management cited continued pressure on year-over-year device sales as a factor in the revised guidance. Source
External: Guidance assumes no further material deterioration in market conditions, and names currency, tariffs and trade restrictions as examples. Source
Demand: Management described the market as challenging. Source

Earlier plans management reported on

Met: Reported Q1 2026 net sales of $64.9 million fell within that range, as management stated. Source
Ahead: Reported adjusted EBITDA of $8.5 million was above that range; management said it significantly outperformed. Source

Other quarters

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.

As filed with the SEC

Open the filing on EDGAR

SkinHealth Systems Reports First Quarter 2026 Financial Results

Long Beach, Calif., May 7, 2026 - SkinHealth Systems Inc. (NASDAQ: SKIN) (“SkinHealth Systems” or the "Company"), home to flagship brand Hydrafacial, today announced financial results for the first quarter ended March 31, 2026 (“Q1 2026”).

“First quarter results reflect the strength of the business. We delivered revenue within our guidance range, significantly outperformed on adjusted EBITDA, and continued to expand margins through disciplined execution.

"While the market remains challenging and we are lowering our full-year revenue outlook, the fundamentals are intact. The installed base is growing, the brand is strong, and we are taking direct action to improve execution while continuing to invest in the capabilities and innovation that will drive long-term growth.” said Pedro Malha, President and CEO of SkinHealth Systems.

Key Operational and Business Metrics

	Three Months Ended March 31,
Unaudited ($ in millions)		2026		2025
Delivery Systems net sales	$18.5		$20.2
Consumables net sales	46.4		49.4
Total net sales	$64.9		$69.6
Gross profit	$44.4		$48.6
Gross margin	68.5%		69.8%
Adjusted gross profit	$46.9		$50.0
Adjusted gross margin	72.2%		71.9%
Operating expenses	$46.2		$60.6
Adjusted operating expenses	$38.4		$42.8
Net loss	$(6.6)		$(10.1)
Net loss margin	(10.2)%		(14.5)%
Adjusted EBITDA	$8.5		$7.3
Adjusted EBITDA margin	13.1%		10.4%

	Three Months Ended March 31,
Unaudited		2026		2025
Total delivery systems sold	746		862
Active install base	36,419		35,014

(1) Amounts may not sum due to rounding.

(2) See "Non-GAAP Financial Measures" below.

(3) Estimated number of delivery systems owned by providers that have purchased consumables in the trailing twelve-month period.

First Quarter Financial Highlights

Net sales were $64.9 million for the first quarter of 2026, a decrease of (6.7)%, compared to the prior year period ("Q1 2025"), due to lower delivery systems and consumables net sales. The Company placed 746 delivery systems during Q1 2026, compared to 862 during Q1 2025.
Gross margin was 68.5% in Q1 2026, compared to 69.8% in Q1 2025. The decrease in gross margin was primarily due to higher amortization expense. Adjusted gross margin was relatively flat at 72.2% in Q1 2026 compared to 71.9% in Q1 2025.
Operating expenses were $46.2 million in Q1 2026, compared to $60.6 million in Q1 2025. Adjusted operating expenses were $38.4 million in Q1 2026, compared to $42.8 million in Q1 2025. The improvement in operating expenses and adjusted operating expenses was primarily due to lower personnel-related expenses and lower marketing-related spend.
Net loss was $(6.6) million in Q1 2026, compared to $(10.1) million in Q1 2025. The change compared to the prior year was primarily due to lower operational spend, partially offset by lower net sales.
Adjusted EBITDA was $8.5 million in Q1 2026, compared to $7.3 million in Q1 2025. The improvement in adjusted EBITDA was primarily due to lower operational spend, partially offset by lower net sales.

Revised 2026 Financial Guidance

Second Quarter 2026
Net sales	$72 - $77 million
Adjusted EBITDA	$11 - $13 million

Fiscal Year 2026
Net sales	$280 - $295 million
Adjusted EBITDA	$35 - $45 million

(1) See "Non-GAAP Financial Measures" below.

Revised 2026 financial guidance:

Reflects continued pressure on year over year device sales.
Presumes no further material deterioration in current general market conditions or other unforeseen circumstances beyond the Company's control, such as foreign currency exchange rates, tariffs, and trade restrictions.
Excludes any unannounced acquisitions, dispositions or financings.

Regional Operational and Business Metrics

	Three Months Ended March 31,
Unaudited ($ in millions) (1) (2)		2026		2025
Delivery Systems net sales
Americas	$12.0		$13.1
Asia-Pacific (“APAC”)	2.1		2.0
Europe, the Middle East and Africa (“EMEA”)	4.4		5.1
Total Delivery Systems net sales	$18.5		$20.2
Consumables net sales
Americas	$32.6		$33.1
APAC	4.5		6.4
EMEA	9.3		9.9
Total Consumables net sales	$46.4		$49.4
Net sales
Americas	$44.6		$46.3
APAC	6.6		8.3
EMEA	13.7		15.0
Total net sales	$64.9		$69.6
Delivery Systems sold
Americas	438		550
APAC	118		98
EMEA	190		214
Total Delivery Systems sold	746		862

(1) Amounts may not sum due to rounding.

(2) During the second quarter of 2025, the Company transitioned sales in the China market to a distributor partner, and as a result, the Company has discontinued direct sales to customers in China.

Conference Call

SkinHealth Systems will host a conference call on Thursday, May 7, 2026, at 4:30 p.m. ET to review its first quarter 2026 financial results. The call may be accessed via live webcast through the Events & Presentations page on our Investor Relations website at www.skinhealthsystems.com. A recording of the call will become available on the site approximately three hours after its conclusion.

Non-GAAP Financial Measures

In addition to results determined in accordance with accounting principles generally accepted in the United States of America ("GAAP"), management utilizes certain non-GAAP financial measures such as adjusted gross profit, adjusted gross margin, adjusted EBITDA, and adjusted EBITDA margin for purposes of evaluating ongoing operations and for internal planning and forecasting purposes.

Management believes that these non-GAAP financial measures, when reviewed collectively with the Company’s GAAP financial information, provide useful supplemental information to investors in assessing the Company's operating performance. These non-GAAP financial measures should not be considered as an alternative to GAAP financial information or as an indication of operating performance or any other measure of performance derived in accordance with GAAP, and may not provide information that is directly comparable to that provided by other companies in its industry, as these other companies may calculate non-GAAP financial measures differently, particularly related to unusual items.

Adjusted gross profit is gross profit excluding the effects of depreciation expense, amortization expense, and share-based compensation expense and other long-term incentive compensation. Adjusted gross margin represents adjusted gross profit as a percentage of net sales.

Adjusted operating expenses is calculated as total operating expenses excluding the effects of depreciation expense; amortization expense; share-based compensation expense and other long-term incentive compensation; litigation related costs; Go-to-Market restructuring; and severance, restructuring, and other.

Adjusted EBITDA is calculated as net loss excluding the effects of (benefit) expense for income taxes; depreciation expense; amortization expense; share-based compensation expense and other long-term incentive compensation; interest expense; interest income; other income, net; change in fair value of warrant liabilities; foreign currency loss (gain), net; litigation related costs; Go-to-Market restructuring; and severance, restructuring and other. Adjusted EBITDA margin represents adjusted EBITDA as a percentage of net sales.

The Company does not provide a reconciliation of its fiscal 2026 adjusted EBITDA guidance to net loss, the most directly comparable forward looking GAAP financial measures, due to the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliation, which cannot be done without unreasonable efforts, including adjustments that could be made for changes in fair value of warrant liabilities, integration and acquisition-related expenses, amortization expenses, non-cash share-based compensation, gains/losses on foreign currency, and other charges reflected in our reconciliation of historic numbers, the amount of which, based on historical experience, could be significant. The presentation of this financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. The Company's fiscal 2026 adjusted EBITDA guidance is merely an outlook and is not a guarantee of future performance. Stockholders should not rely or place an undue reliance on such forward-looking statements. See “Forward-Looking Statements” for additional information.

Condensed Consolidated Statements of Comprehensive Income (Loss)

($ in millions, except share and per share amounts)

(Unaudited)

	Three Months Ended March 31,
	2026		2025
Net sales	$64.9		$69.6
Cost of sales	20.5		21.0
Gross profit	44.4		48.6
Operating expenses:
Selling and marketing	23.2		26.0
Research and development	1.1		1.0
General and administrative	21.9		33.6
Total operating expenses	46.2		60.6
Loss from operations	(1.8)		(12.0)
Interest expense	6.3		2.5
Interest income	(1.5)		(3.0)
Other income, net	(1.0)		(0.1)
Change in fair value of warrant liabilities	-		(0.3)
Foreign currency transaction loss (gain), net	1.2		(1.9)
Loss before provision for income taxes	(6.8)		(9.2)
Income tax (benefit) expense	(0.2)		0.9
Net loss	(6.6)		(10.1)
Comprehensive loss, net of tax:
Foreign currency translation adjustments	(0.3)		1.1
Comprehensive loss		$(6.9)		$(9.0)
Net loss per share
Basic		$(0.05)		$(0.08)
Diluted		$(0.05)		$(0.08)
Weighted average common shares outstanding
Basic	127,792,611		125,079,470
Diluted	131,399,898		125,079,470

Condensed Consolidated Balance Sheets

($ in millions)

(Unaudited)

	March 31, 2026		December 31, 2025
ASSETS
Current assets:
Cash, cash equivalents, and restricted cash		$204.4		$232.7
Accounts receivable, net		18.6		21.7
Inventories		47.7		48.0
Income tax receivable		1.6		1.7
Prepaid expenses and other current assets		5.4		5.4
Total current assets		277.7		309.5
Property and equipment, net		2.3		2.5
Right-of-use assets, net		20.3		11.6
Intangible assets, net		32.8		35.8
Goodwill		126.2		126.6
Deferred income tax assets, net		2.4		1.9
Other assets		11.5		11.9
TOTAL ASSETS		$473.2		$499.8
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of convertible senior notes, net		$102.9		$124.0
Accounts payable		15.9		15.6
Accrued payroll-related expenses		13.0		24.9
Lease liabilities, current		4.2		5.1
Income tax payable		0.5		1.2
Other accrued expenses		18.7		15.4
Total current liabilities		155.2		186.3
Lease liabilities, non-current		18.8		9.2
Deferred income tax liabilities, net		0.4		0.4
Convertible senior notes, net		241.3		240.4
Other long-term liabilities		2.4		2.4
TOTAL LIABILITIES		$418.0		$438.7
Stockholders’ equity:
Class A Common Stock	$ -		$ -
Additional paid-in capital	581.1		580.0
Accumulated other comprehensive loss	(1.7)		(1.4)
Accumulated deficit	(524.1)		(517.5)
Total stockholders’ equity	$55.2		$61.1
LIABILITIES AND STOCKHOLDERS’ EQUITY	$473.2		$499.8

Condensed Consolidated Statement of Cash Flows

($ in millions)

(Unaudited)

	Three Months Ended March 31,
	2026		2025
Cash, cash equivalents, and restricted cash at beginning of period		$232.7		$370.1
Operating activities:
Net loss	(6.6)		(10.1)
Non-cash adjustments	10.2		10.2
Change in operating assets and liabilities:
Accounts receivable	2.5		4.0
Inventories	(0.1)		3.8
Prepaid expenses, other current assets, and income tax receivable	-		2.9
Accounts payable, accrued expenses, and income tax payable	(9.6)		(5.7)
Other, net	(2.0)		(2.0)
Net cash (used for) provided by operating activities	(5.6)		3.0
Net cash used for investing activities	(1.6)		(1.1)
Net cash used for financing activities	(20.9)		(0.3)
Net change in cash, cash equivalents, and restricted cash	(28.1)		1.6
Effect of foreign currency translation	(0.2)		1.4
Cash, cash equivalents, and restricted cash at end of period	$204.4		$373.0

The following table reconciles gross profit to adjusted gross profit for the periods presented:

	Three Months Ended March 31,
Unaudited ($ in millions)		2026		2025
Net sales	$64.9		$69.6
Gross profit	$44.4		$48.6
Gross margin	68.5%		69.8%
Adjusted to exclude the following:
Depreciation expense	0.2		0.2
Amortization expense	2.1		1.1
Share-based compensation expense and other long-term incentive compensation	0.1		0.2
Adjusted gross profit	$46.9		$50.0
Adjusted gross margin	72.2%		71.9%

(2)Includes expense associated with long-term cash performance awards.

The following table reconciles total operating expenses to adjusted operating expenses for the periods presented:

	Three Months Ended March 31,
Unaudited ($ in millions)		2026		2025
Total operating expenses	$46.2		$60.6
Adjusted to exclude the following:
Depreciation expense	0.4		1.6
Amortization expense	2.7		3.2
Share-based compensation expense and other long-term incentive compensation	2.0		3.3
Litigation related costs	2.2		6.9
Go-to-Market restructuring	0.2		2.7
Severance, restructuring and other	0.5		-
Adjusted operating expenses	$38.4		$42.8

(2)Includes expense associated with long-term cash performance awards that can be settled in either cash or Common Stock.

The following table reconciles net loss to adjusted EBITDA for the periods presented:

	Three Months Ended March 31,
Unaudited ($ in millions)		2026		2025
Net sales	$64.9		$69.6
Net loss	$(6.6)		$(10.1)
Net loss margin	(10.2)%		(14.5)%
Adjusted to exclude the following:
(Benefit) expense for income taxes	(0.2)		0.9
Depreciation expense	0.6		1.9
Amortization expense	4.8		4.3
Share-based compensation expense and other long-term incentive compensation	2.1		3.5
Interest expense	6.3		2.5
Interest income	(1.5)		(3.0)
Other income, net	(1.0)		(0.1)
Change in fair value of warrant liabilities	-		(0.3)
Foreign currency loss (gain), net	1.2		(1.9)
Litigation related costs	2.2		6.9
Go-to-Market restructuring	0.2		2.7
Severance, restructuring and other	0.5		-
Adjusted EBITDA	$8.5		$7.3
Adjusted EBITDA margin	13.1%		10.4%

(2)Includes expense associated with long-term cash performance awards that can be settled in either cash or Common Stock.

About SkinHealth Systems

SkinHealth Systems (NASDAQ: SKIN) is a global medical aesthetics company delivering an integrated ecosystem of clinically proven solutions designed to help consumers achieve superior skin health and support the success of providers. Anchored by Hydrafacial™, a leading and widely requested professional skincare treatment, and supported by complementary offerings including SkinStylus™ microneedling and HydraScalp™ with Keravive™, SkinHealth Systems combines advanced device technology, proprietary consumables, and clinical validation to deliver trusted treatment experiences through an omnichannel network of providers worldwide. Learn more at skinhealthsystems.com or follow us on LinkedIn. Local providers can be found at hydrafacial.com/find-a-hydrafacialist.

Forward-Looking Statements

Certain statements made in this release are “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995 and within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding SkinHealth Systems Inc.’s strategy, plans, objectives, initiatives and financial outlook. When used in this press release, the words “estimates,” “projected,” “expects,” “anticipates,” “forecasts,” “plans,” “intends,” “believes,” “seeks,” “may,” “will,” “should,” “future,” “propose” and variations of these words or similar expressions (or the negative versions of such words or expressions) are intended to identify forward-looking statements.

These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside SkinHealth Systems Inc.’s control, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. As such, readers are cautioned not to place undue reliance on any forward-looking statements.

Forward-looking statements notice

Important factors that may affect actual results or outcomes include, among others: SkinHealth Systems Inc.’s ability to manage growth; SkinHealth Systems Inc.’s ability to execute its business plan; potential negative reactions or outcomes related to the Company’s name change in general and focused shift in operations; potential litigation involving SkinHealth Systems Inc.; changes in applicable laws or regulations; the possibility that SkinHealth Systems Inc. may be adversely affected by other economic, business, and/or competitive factors; and other risks and uncertainties set forth in the sections entitled “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 filed with the U.S. Securities and Exchange Commission (the “SEC”) and in the Company’s subsequent filings with the SEC such as on a Quarterly Report on Form 10-Q. Those risks continue to be relevant to the Company's performance and financial condition. Moreover, the Company operates in a very competitive and rapidly changing environment. New risk factors emerge from time-to-time and it is not possible for management to predict all such risk factors, nor can it assess the impact of all such risk factors on the business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. SkinHealth Systems Inc. expressly disclaims any responsibility to update forward-looking statements, whether as a result of new information, future events or otherwise.

Contacts
Press: press@skinhealthsystems.com
Investors: IR@skinhealthsystems.com