Lifeward Ltd. (ReWalk Robotics Ltd.) — Q1 2024 Form 10-Q
Reporting period: Three months ended March 31, 2024. The interim financial statements are unaudited. The company rebranded as Lifeward in January 2024; the filing registrant remains ReWalk Robotics Ltd., doing business as Lifeward.
Business context
Lifeward develops and sells rehabilitation and mobility products, including ReWalk exoskeletons, ReStore exo-suits, MyoCycle devices and AlterG anti-gravity systems. AlterG was acquired in August 2023, so Q1 2024 results include its contribution while the comparable 2023 period does not.
Key financial metrics
| Metric | Q1 2024 | Q1 2023 / comparison |
|---|---|---|
| Revenue | $5.283 million | $1.230 million; up approximately 340% |
| Gross profit / margin | $1.395 million / 26.4% | $0.571 million / 46.4% |
| Operating expenses | $7.897 million | $4.946 million |
| Operating loss | $6.502 million | $4.375 million |
| Net loss | $6.276 million | $4.321 million |
| Net loss per share, basic and diluted | $0.73 | $0.51 |
| Net cash used in operating activities | $7.673 million | $5.233 million |
| Cash and cash equivalents at period end | $20.744 million | $28.083 million at December 31, 2023 |
| Total assets / total liabilities | $55.218 million / $14.603 million | $63.192 million / $16.682 million at December 31, 2023 |
Q1 2024 gross profit included approximately $0.4 million of acquired-intangible amortization. Excluding that expense, management reported a 33.7% gross margin, still 12.8 percentage points below the prior-year margin. The filing presents no borrowings on the balance sheet; lease liabilities were $1.599 million, and the AlterG earnout liability was $3.288 million. Cash, cash equivalents and restricted cash totaled $21.104 million.
Revenue comprised $3.739 million of product sales, $0.886 million of rentals and $0.658 million of service and warranty revenue. AlterG contributed $2.8 million of revenue, while higher ReWalk Personal sales also contributed to growth. U.S. revenue was $3.747 million.
Material changes and developments
- Revenue rose sharply, primarily reflecting AlterG and increased ReWalk Personal sales. Gross margin declined due to low AlterG sales volume and unfavorable production-cost absorption, along with product mix.
- Sales and marketing expense increased to $5.014 million from $2.484 million, driven by higher headcount, commissions, marketing and rebranding costs. Research and development expense rose to $1.291 million from $0.752 million. General and administrative expense decreased to $1.592 million from $1.710 million, partly due to a $0.5 million post-acquisition adjustment.
- Operating cash use increased by $2.440 million year over year. Management attributed the increase mainly to weaker gross margin and working-capital timing.
- A one-for-seven reverse share split took effect March 15, 2024. On April 3, 2024, the company reported that Nasdaq had confirmed it regained minimum-bid-price compliance.
Outlook, risks and unusual items
- On April 11, 2024, CMS established a $91,032 lump-sum Medicare payment rate for the ReWalk Personal Exoskeleton, effective April 1. Management reported that Medicare Administrative Contractors had begun approving previously submitted claims. The commercial impact depends on continued coverage, claim approvals and reimbursement.
- Management said cash on hand was sufficient to support operations for more than 12 months after issuance of the statements. It also expects future losses and says additional capital may be needed until profitability or positive operating cash flow is achieved. No clear full-year revenue or earnings guidance value is provided in the filing text; Q1 revenue was described as at the midpoint of company guidance.
- Management expects margins could improve with higher volume and operating efficiencies, potentially offset by materials and service costs. Priorities include reimbursement expansion, integrating ReWalk and AlterG commercial operations, and product development, including the ReWalk 7 and a lower-cost AlterG model. ReBoot development investment remains paused pending assessment of its clinical and commercial opportunity.
- Liquidity and execution risks include quarterly operating cash burn, reliance on future financing, reimbursement uncertainty, and $7.457 million of non-cancelable purchase commitments. The company relies on Sanmina for manufacturing SCI and ReStore products.
- Customer concentration is notable: one customer represented 26% of quarterly revenue and 40% of trade receivables at March 31, 2024. The filing describes ordinary-course legal matters but reports no material litigation beyond previously disclosed matters.
- The company had 2.735 million outstanding warrants at March 31, 2024, in addition to equity awards; exercise could increase share count. The one-for-seven reverse split is reflected retrospectively in reported share and per-share data.
Important facts for investors to verify
- Whether CMS reimbursement rates and MAC claim approvals translate into sustained ReWalk Personal orders, collections and revenue.
- AlterG’s sales volume, integration progress and ability to improve gross margins after the acquisition.
- Cash consumption relative to management’s stated runway, and the timing and terms of any required financing.
- Customer concentration, receivable collectability, purchase commitments and supplier dependence.
- Potential dilution from warrants and awards, and continued compliance with Nasdaq listing requirements.