Tactile Medical Cuts Airway Clearance Outlook To A Mid-To-High Single-Digit Decline, Keeps Revenue Guidance
Slow inventory burn at a few equipment dealers hits AfloVest, but lymphedema growth holds the $360 million to $366 million revenue outlook.
Tactile Medical now expects full-year airway clearance revenue to fall in the mid to high single digits, down from a prior view of roughly flat, CEO Sheri Dodd and CFO Elaine Birkemeyer said on the company's Monday third-quarter earnings call. The company still held its 2026 revenue guidance at $360 million to $366 million and raised adjusted EBITDA guidance to $50 million to $52 million.
Dealers burn through stock more slowly
Tactile Systems Technology, which does business as Tactile Medical and makes at-home devices for chronic disease, sells its AfloVest airway-clearance vest through durable medical equipment dealers. Birkemeyer said those customers are taking longer than expected to work through existing inventory as they move to the next-generation vest, so the company now assumes a more gradual return to normal ordering.
Dodd said the pace "really is not something I can directly control," and that management is "calling it as we see it right now." She said patient demand, therapy effectiveness and competition are unchanged. The slowdown involves the same dealers flagged in the second quarter, she said, and exposure is concentrated in a small handful of customers.
An analyst with William Blair asked about visibility into sell-through. Dodd said the company lacks real-time visibility into every dealer location. Dealers without excess stock report strong feedback on the new vest, she said, but "we just can't overcome" the slowdown at those still working through inventory.
Third-quarter airway clearance revenue was $10 million, down $3.4 million, or 25.1%, Birkemeyer said. Management expects sequential improvement in the fourth quarter, with revenue still below the prior year.
Lymphedema carries the quarter
Total third-quarter revenue was $91.9 million, up 7.1%. Lymphedema revenue rose 13.1% to $81.8 million, with Medicare up about 11% and commercial up about 17%. Lymphedema products made up 84% of 2025 revenue, per the company's annual report.
Net income was $7.2 million, or $0.31 per diluted share, against $8.2 million, or $0.36, a year earlier. Adjusted EBITDA was $14.3 million, versus $14.4 million. Gross margin widened to 76.7% from 75.8%. The company ended the quarter with $75.1 million in cash and no borrowings.
For the full year, Birkemeyer said the new adjusted EBITDA range implies growth of about 12% to 16% from $44.8 million in 2025. Management still expects low double-digit lymphedema growth for 2026.
Tempering 2027 expectations
Pressed on 2027, Dodd said the company will not give guidance and sees no reason for lymphedema to slow. She also cautioned that there will be no sudden "hockey stick" from FlexiTouch Pro and the Lymphatec 3D scanner, since patients still need documentation and physician visits. Dodd cited an estimated 20 million people in the U.S. living with undiagnosed lymphedema.
Tactile filed its FDA application for FlexiTouch Pro in October and is targeting a second-half 2027 launch, subject to the regulatory process. A VA pilot of Myosleeve, which Tactile is preparing to bring to the U.S. through a partnership with Elastomed, is set to begin in late fourth quarter. Dodd said Myosleeve is not in 2026 guidance.
Tactile's VA pilot of Myosleeve begins in late fourth quarter, with FlexiTouch Pro targeted for the second half of 2027.
Sources
- Tactile Systems Technology GAAP EPS of $0.31 beats by $0.02, revenue of $91.86M misses by $0.13M (NASDAQ:TCMD) | Seeking Alpha — seekingalpha.com
- Tactile Systems Technology, Inc. Reports Third Quarter 2026 Financial Results — Yahoo Finance
- Tactile Systems Technology, Inc. Reports Third Quarter 2026 — globenewswire.com
