Treace Turns Adjusted Ebitda Positive After Expense Cuts

The Tip Desk · November 6, 2026 · 3 min read

Adjusted EBITDA reached $0.3 million in the third quarter as Treace cut operating expenses 10% and narrowed its net loss to $12.6 million.

Treace Medical Concepts (TMCI), a medical technology company focused on surgical treatment of bunions and other foot and ankle conditions, reported Adjusted EBITDA of $0.3 million for the third quarter ended September 30, 2026, up $2.9 million from a $2.6 million loss a year earlier.

That swing marked the first positive Adjusted EBITDA quarter in the three-period run supplied, after a $3.5 million loss in the second quarter of 2026 and a $5.5 million loss in the first quarter. Net loss narrowed to $12.6 million, or $0.19 a share, from $16.3 million, or $0.26 a share, in the third quarter of 2025.

Revenue was $48.3 million, down 4% from $50.2 million a year earlier, after a 4% year-over-year decline in the second quarter and a 10% decline in the first quarter. The company said the third-quarter decline was driven by a mix shift toward lower-priced minimally invasive products and lower volume of bunion procedure kits sold. Excluding sales to stocking distributors, bunion kit sales volume increased and revenue grew mid-single digits versus the third quarter of 2025.

Gross profit was $38.4 million, and gross margin was 79.5%, compared with 79.1% a year earlier. Total operating expenses fell 10% to $49.9 million from $55.4 million a year earlier, after an 8% year-over-year decline in the second quarter. The company attributed the latest reduction primarily to targeted expense-reduction initiatives across the organization.

Sales and marketing expense was $29.7 million, research and development $4.5 million, and general and administrative $15.7 million. Loss from operations was $11.5 million. Interest expense was $1.6 million.

Approximately 45% of Lapiplasty surgeon users were incorporating one or more of the three new bunion systems launched in the third quarter of 2025, up from 40% in the second quarter of 2026. Chief Executive John T. Treace said the company was encouraged by accelerated double-digit case volume growth and continued market share gains, driven by adoption of its bunion systems and expanding technologies including SuperBite compression screws.

The company announced five-year results of a prospective, multicenter study of the Lapiplasty procedure.

Cash, cash equivalents, and marketable securities totaled $39.8 million as of September 30, 2026. Year-to-date cash usage through that date was reduced 53%, or $9.7 million, versus the same period in 2025. The existing credit facility provides up to an additional $115 million of borrowing capacity subject to certain conditions.

Treace updated full-year 2026 revenue guidance to $206 million to $210 million, from the prior range of $204 million to $212 million, representing a decline of 3% to 1% compared with full-year 2025. It updated its expectation of a loss in Adjusted EBITDA to $1.0 million to $2.0 million for full-year 2026, from the prior range of $3.0 million to $5.0 million. Full-year 2025 Adjusted EBITDA was a $3.9 million loss. The company reiterated an expectation for a reduction in cash usage of approximately 50% for full-year 2026 versus full-year 2025.

Full-year 2026 guidance assumes continued case volume growth and improving year-over-year revenue growth rates.