By Thomas Kerr, CFA
NASDAQ: CTSO
READ THE FULL CTSO RESEARCH REPORT
2025 Financial Results & Business Update
On March 25, 2026, CytoSorbents (NASDAQ: CTSO) announced 4th quarter and full year 2025 financial and operating results. In the 4th quarter, revenues increased 1.0% to $9.2 million compared to the prior year period and were down 8.0% on a constant currency basis. Gross margin improved to 74% in the quarter compared to 70% in Q4 2024 due to improved operating efficiencies. The operating loss, which included a restructuring charge of approximately $0.5 million due to workforce and cost reduction programs, was ($4.6) million, compared to ($3.7) million in Q4 2024. Net loss was ($5.5) million or ($0.09) per share, compared to a net loss of ($7.6) million or ($0.14) per share in Q4 2024. Adjusted net loss was ($4.3) million or ($0.07) per share, compared to an adjusted net loss of ($1.7) million or ($0.03) per share in Q4 2024. Adjusted EBITDA loss was ($3.2) million compared to a loss of ($2.4) million in Q4 2024.
For the full year 2025, revenues grew by 4% to $37.1 million, led by a 13.0% increase in direct sales outside of Germany to $8.6 million and an 11.4% increase in distributor sales to $16.5 million. Those together accounted for approximately 68% of total sales. This was offset by a 10% reduction in direct Germany sales to $11.8 million, which reflects the near-term impact of proactive restructuring of German sales operations and the implementation of strategies that are expected to drive more consistent and scalable growth. These improvements include enhanced customer targeting, structured weekly sales planning, increased focus on new account development, and improved allocation of sales resources. So far in 2026, the company has seen improving commercial activity, including increased customer engagement and new account development in Germany.
Gross margin for the year improved to 71% from 70% in the prior year, reflecting continued strength in product mix and cost discipline. Operating loss narrowed 10% year over year to ($14.7) million from ($16.5) million, indicating improved operating efficiency despite ongoing profitability challenges. Net loss improved to ($8.2) million, or ($0.13) per share, compared to a net loss of ($20.7) million, or ($0.38) per share in 2024. Adjusted EBITDA loss improved to ($10.5) million from ($11.5) million in 2024 as progress continued to narrow core operating losses.
Total cash balances were $7.8 million on December 31, 2025, compared to $9.1 million as of September 30, 2025. Total debt was $16.7 million with no near-term maturities.
In the 4th quarter of 2025, the company implemented a strategic workforce and cost reduction program, which reduced headcount by 10% and also lowered expenses and realigned operating and production spend. These production efficiencies resulted in an increased inventory buffer, which enables a reduction in 2026 production expenditures, which should help reduce cash burn this year. CytoSorb now anticipates achieving cash flow breakeven in the 2nd half of 2026 while maintaining adequate cash balances.
DrugSorb®-ATR Regulatory Update
In January 2026, the company had a formal pre-submission meeting with the FDA and continues to actively engage with the FDA to clarify and confirm the requirements for a new De Novo submission (see below for details and background on DrugSorb-ATR regulatory events). As these interactive discussions are ongoing, the company expects to provide an update on the anticipated timing of the submission once final requirements are established. Following submission, a regulatory decision is typically expected within a 150-day review period, although the timeline may be accelerated or extended based on the nature and scope of FDA interactions during the review process. CytoSorbents appears to be moving towards a patient and diligent approach to the submission in order to ensure accuracy and to position the initiative for success and ultimate approval.
In the meantime, the U.S. and Canadian pivotal STAR-T randomized, controlled trial results have now been published in the Journal of Thoracic and Cardiovascular Surgery (2026), which is the leading peer-reviewed cardiothoracic surgery journal in the U.S. The authors summarized the results in the graphical abstract and concluded in the central message of the article that, "Intraoperative DrugSorb-ATR use for ticagrelor removal is safe and can reduce the severity of bleeding after isolated CABG in patients operated within 2 days of drug discontinuation."
Valuation and Estimates
Based on 2025 results and management commentary, we adjust our full year 2026 revenue estimate to $39.1 million and adjust our 2026 loss per share to ($0.19). We believe 2027 revenues can reach $42.2 million without the commercialization of DrugSorb-ATR.
In the 4th quarter, the company implemented a strategic workforce and cost reduction program, which reduced headcount by 10% while also lowering expenses and realigning operating and production spend. According to the company’s recent earnings call, it continues “to adjust and reduce our operating and production cost as we begin 2026,” and now expects to achieve breakeven in the second half of 2026. We expect to see the benefit of these actions in lowered cash burn in the first half of 2026 and believe the core business (i.e., the existing CytoSorb business) could reach cash flow breakeven at some point in the 2nd half of 2026.
Based on ongoing cost controls and the additional production efficiencies, we believe gross margins in 2026 will improve over the 71% range achieved in 2025.
Beginning in 2025, the company began a significant reorganization of the direct sales team and strategy in Germany (its largest market for the CytoSorb device). This includes the rebalancing of territories and hospital accounts with the goal of restoring sales growth through deeper customer engagement, more effective market development, and improved sales representative productivity. The company is pleased with the initial progress of this reorganization and remains confident it will lead to stronger execution, improved performance, and better sales growth in the region.
We maintain our price target of $5.00 per share. We believe the company has adequate liquidity and funding options to support its business model through the expected regulatory approval of DrugSorb-ATR and the subsequent commercial launch in 2026 or 2027.
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