Fourth Quarter 2025 Summary:
Total revenue increased 21% year-over-year to $103.6 million
Gross margin of 78% versus 75% in Q4 2024
Net income of $10.6 million versus $9.7 million in Q4 2024
Adjusted EBITDA of $22.9 million versus $16.2 million in Q4 2024
Full Year 2025 Summary:
Total revenue increased 12% year-over-year to $329.5 million
Gross margin of 76%, compared to 74% in 2024
Operating cashflow of $42.8 million, compared to $40.7 million in 2024
Repaid full outstanding principal balance of $26.3 million under the Company's term loan
Repurchased $26.5 million of stock at an average price of $12.36 per share
Ended 2025 with $83.4 million in cash, compared to $94.4 million at the end of 2024
Recent Business Highlights
Acquired LymphaTech, expanding our lymphedema solutions portfolio and strengthening our R&D capabilities with their digital 3D scanning technology for chronic swelling detection, measurement, and monitoring
Announced the publication of two-month clinical data comparing Flexitouch Plus™ to usual care in the Journal of the Sciences and Specialties of the Head and Neck
"In 2025, we executed with discipline against our core growth strategies, delivering double-digit revenue growth, expanding gross margin and adjusted EBITDA, and generating strong cash flow, while continuing to strategically invest in people and workflow-related processes to strengthen our business for scale," said Sheri Dodd, Chief Executive Officer of Tactile Medical. "We delivered on our goals, and in doing so, advanced our mission of improving the lives of over 95,000 patients with lymphedema and chronic inflammatory lung disease."
Ms. Dodd continued, "Looking ahead, we anticipate continued commercial and operational momentum in our lymphedema business to support sustained market leadership and revenue performance in line with overall market growth. Alongside increasing depth and breadth of collaboration with our DME partners in our respiratory business, we believe we are entering 2026 from a position of operational and financial strength."
Fourth Quarter 2025 Financial Results
Total revenue in the fourth quarter of 2025 increased $18.0 million, or 21%, to $103.6 million, compared to $85.6 million in the fourth quarter of 2024. The increase in total revenue was attributable to an increase of $12.4 million, or 16%, in sales and rentals of the lymphedema product line and an increase of $5.6 million, or 66%, in sales of the airway clearance product line.
Gross profit in the fourth quarter of 2025 increased $16.6 million, or 26%, to $81.0 million, compared to $64.4 million in the fourth quarter of 2024. Gross margin was 78% of revenue, compared to 75% of revenue in the fourth quarter of 2024.
Operating expenses in the fourth quarter of 2025 increased $10.4 million, or 20%, to $62.2 million, compared to $51.9 million in the fourth quarter of 2024.
Operating income was $18.8 million in the fourth quarter of 2025, compared to $12.5 million in the fourth quarter of 2024.
Income tax expense was $8.8 million in the fourth quarter of 2025, compared to $3.3 million in the fourth quarter of 2024.
Net income in the fourth quarter of 2025 was $10.6 million, or $0.46 per diluted share, compared to $9.7 million, or $0.40 per diluted share, in the fourth quarter of 2024.
Weighted average shares used to compute diluted net income per share were 23.0 million and 24.5 million for the fourth quarters of 2025 and 2024, respectively.
Adjusted EBITDA was $22.9 million in the fourth quarter of 2025, compared to $16.2 million in the fourth quarter of 2024.
Full Year 2025 Financial Results
Total revenue in the full year of 2025 increased $36.5 million, or 12%, to $329.5 million, compared to $293.0 million in the full year of 2024. The increase in total revenue was attributable to an increase of $19.0 million, or 7%, in sales and rentals of the lymphedema product line and an increase of $17.5 million, or 52%, in sales of the airway clearance product line.
Net income in the full year of 2025 was $19.1 million, or $0.82 per diluted share, compared to $17.0 million, or $0.70 per diluted share, in the full year of 2024.
Weighted average shares used to compute diluted net income per share were 23.3 million and 24.1 million in the full year of 2025 and 2024, respectively.
Adjusted EBITDA was $44.8 million in the full year of 2025, compared to $37.1 million in the full year of 2024.
Balance Sheet Summary
As of December 31, 2025, the Company had $83.4 million in cash and no outstanding borrowings under its credit agreement, compared to $94.4 million in cash and $26.3 million of outstanding borrowings under its credit agreement as of December 31, 2024. In 2025, the Company repaid the full outstanding principal balance of $26.3 million under its term loan and repurchased $26.5 million of stock under its original share repurchase program at an average price of $12.36 per share excluding commissions and excise tax.
2026 Financial Outlook
The Company expects full year 2026 total revenue in the range of $357 million to $365 million, representing growth of approximately 8% to 11% year-over-year, compared to total revenue of $329.5 million in 2025. The Company also expects full year 2026 adjusted EBITDA in the range of $49 million to $51 million, compared to adjusted EBITDA of $44.8 million in 2025.
Conference Call
Management will host a conference call with a question-and-answer session at 5:00 p.m. Eastern Time on February 17, 2026, to discuss the results of the quarter and fiscal year. Those who would like to participate may dial 877-407-3088 (201-389-0927 for international callers) and provide access code 13758303. A live webcast of the call will also be provided on the investor relations section of the Company's website at investors.tactilemedical.com.
For those unable to participate, a replay of the call will be available for two weeks at 877-660-6853 (201-612-7415 for international callers); access code 13758303. The webcast will be archived at investors.tactilemedical.com.
About Tactile Systems Technology, Inc. (DBA Tactile Medical)
Tactile Medical is a leader in developing and marketing at-home therapies for people suffering from underserved, chronic conditions including lymphedema, lipedema, chronic venous insufficiency and chronic inflammatory lung disease by helping them live better and care for themselves at home. Tactile Medical collaborates with clinicians to expand clinical evidence, raise awareness, increase access to care, reduce overall healthcare costs and improve the quality of life for tens of thousands of patients each year.
Legal Notice Regarding Forward-Looking Statements
This release contains forward-looking statements, including guidance for the full year 2025. Forward-looking statements are generally identifiable by the use of words like "may," "will," "should," "could," "expect," "anticipate," "estimate," "believe," "intend," "continue," "confident," "outlook," "guidance," "project," "goals," "look forward," "poised," "designed," "plan," "return," "focused," "prospects" or "remain" or the negative of these words or other variations on these words or comparable terminology. The reader is cautioned not to put undue reliance on these forward-looking statements, as these statements are subject to numerous factors and uncertainties outside of the Company's control that can make such statements untrue, including, but not limited to, the Company's ability to obtain reimbursement from third-party payers for its products; adverse economic conditions, including inflation, rising interest rates or a recession; the adequacy of the Company's liquidity to pursue its business objectives; price increases for supplies and components; wage and component price inflation; loss of a key supplier or other supply chain disruptions; entry of new competitors and/or competitive products; compliance with and changes in federal, state and local government laws and regulations; technological obsolescence of, or quality issues with, the Company's products; the Company's ability to expand its business through strategic acquisitions; the Company's ability to integrate acquisitions and related businesses; the effects of current and future U.S. and foreign trade policy and tariff actions; or the inability to carry out research, development and commercialization plans. In addition, other factors that could cause actual results to differ materially are discussed in the Company's filings with the SEC. Investors and security holders are urged to read these documents free of charge on the SEC's website at http://www.sec.gov. The Company undertakes no obligation to publicly update or revise its forward-looking statements as a result of new information, future events or otherwise.
Use of Non-GAAP Financial Measures
This press release includes the non-GAAP financial measure of Adjusted EBITDA, which differs from financial measures calculated in accordance with U.S. generally accepted accounting principles ("GAAP"). Adjusted EBITDA in this release represents net income, plus interest expense, net, or less interest income, net, less income tax benefit or plus income tax expense, plus depreciation and amortization, plus stock-based compensation expense, and plus executive transition costs. Reconciliation of this non-GAAP financial measure to its most directly comparable GAAP measure is included in this press release.
This non-GAAP financial measure is presented because the Company believes it is a useful indicator of its operating performance. Management uses this measure principally as a measure of the Company's operating performance and for planning purposes, including the preparation of the Company's annual operating plan and financial projections. The Company believes this measure is useful to investors as supplemental information and because it is frequently used by analysts, investors and other interested parties to evaluate companies in its industry. The Company also believes this non-GAAP financial measure is useful to its management and investors as a measure of comparative operating performance from period to period. In addition, Adjusted EBITDA is used as a performance metric in the Company's compensation program.
The non-GAAP financial measure presented in this release should not be considered as an alternative to, or superior to, its respective GAAP financial measure, as a measure of financial performance or cash flows from operations as a measure of liquidity, or any other performance measure derived in accordance with GAAP, and it should not be construed to imply that the Company's future results will be unaffected by unusual or non-recurring items. In addition, Adjusted EBITDA is not intended to be a measure of free cash flow for management's discretionary use, as it does not reflect certain cash requirements such as tax payments, debt service requirements, capital expenditures and certain other cash costs that may recur in the future. Adjusted EBITDA contains certain other limitations, including the failure to reflect our cash expenditures, cash requirements for working capital needs and cash costs to replace assets being depreciated and amortized. In evaluating non-GAAP financial measures, you should be aware that in the future the Company may incur expenses that are the same as or similar to some of the adjustments in this presentation. The Company's presentation of non-GAAP financial measures should not be construed to imply that its future results will be unaffected by any such adjustments. Management compensates for these limitations by primarily relying on the Company's GAAP results in addition to using non-GAAP financial measures on a supplemental basis. The Company's definition of these non-GAAP financial measures is not necessarily comparable to other similarly titled captions of other companies due to different methods of calculation.
Tactile Systems Technology, Inc.
Consolidated Balance Sheets
December 31,
December 31,
(In thousands, except share and per share data)
2025
2024
Assets
Current assets
Cash
$
83,446
$
94,367
Accounts receivable, net
43,876
44,937
Net investment in leases
15,754
14,540
Inventories
14,025
18,666
Prepaid expenses and other current assets
8,066
5,053
Total current assets
165,167
177,563
Non-current assets
Property and equipment, net
5,117
5,603
Right of use operating lease assets
13,798
16,633
Intangible assets, net
39,167
42,789
Goodwill
31,063
31,063
Deferred income taxes
9,783
18,311
Other non-current assets
9,847
5,962
Total non-current assets
108,775
120,361
Total assets
$
273,942
$
297,924
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable
$
4,968
$
5,648
Note payable
—
2,956
Accrued payroll and related taxes
19,378
17,923
Accrued expenses
8,531
7,780
Income taxes payable
1,428
270
Operating lease liabilities
3,195
2,980
Other current liabilities
3,457
3,147
Total current liabilities
40,957
40,704
Non-current liabilities
Note payable, non-current
—
23,220
Accrued warranty reserve, non-current
1,045
1,209
Income taxes payable, non-current
275
239
Operating lease liabilities, non-current
12,763
15,955
Total non-current liabilities
14,083
40,623
Total liabilities
55,040
81,327
Stockholders' equity:
Preferred stock, $0.001 par value, 50,000,000 shares authorized; none issued and outstanding as of December 31, 2025 and December 31, 2024
—
—
Common stock, $0.001 par value, 300,000,000 shares authorized; 22,438,926 shares issued and outstanding as of December 31, 2025; 23,883,475 shares issued and outstanding as of December 31, 2024
22
24
Additional paid-in capital
163,940
180,719
Retained earnings
54,940
35,854
Total stockholders' equity
218,902
216,597
Total liabilities and stockholders' equity
$
273,942
$
297,924
Tactile Systems Technology, Inc.
Consolidated Statements of Operations
Three Months Ended
Year Ended
December 31,
December 31,
(In thousands, except share and per share data)
2025
2024
2025
2024
Revenue
Sales revenue
$
92,703
$
75,270
$
292,593
$
256,012
Rental revenue
10,891
10,315
36,929
36,972
Total revenue
103,594
85,585
329,522
292,984
Cost of revenue
