Business and Geographical Reporting Segments

12 Months Ended

Dec. 31, 2024

Business and Geographical Reporting Segments [Abstract]

Business and Geographical Reporting Segments

14. Business and Geographical Reporting Segments

The Company has organized its business into two operating segments to better align its organization based upon the Company’s management structure, products and services offered, markets served and types of customers. The Dermatology Recurring Procedures segment derives its revenues from the usage of its equipment by dermatologists to perform XTRAC and TheraClear procedures. The Dermatology Procedures Equipment segment generates revenues from the sale of equipment, such as lasers and lamp products. The Company’s chief operating decision maker (“CODM”) is the chief executive officer. The CODM reviews financial information presented on an operating segment basis for the purposes of making certain operating decisions and assessing financial performance.

Unallocated operating expenses include costs that are not specific to a particular segment but are general to the group; included are expenses incurred for administrative and accounting staff, general liability and other insurance, professional fees and other similar corporate expenses. Interest and other financing income (expense) is also not allocated to the operating segments.

The following tables present results of operations from the Company’s business segments for the periods indicated below (in thousands, except gross profit %):

Year Ended December 31, 2024	Dermatology Recurring Procedures			Dermatology Procedures Equipment			Total
Revenues	$	21,171		$	12,391		$	33,562
Cost of revenues		7,893			6,588			14,481
Gross profit		13,278			5,803			19,081
Gross profit %		62.7	%		46.8	%		56.9	%
Allocated expenses:
Engineering and product development		658			225			883
Selling and marketing		11,046			1,243			12,289
Impairment of goodwill		3,861			—			3,861
Unallocated expenses		—			—			11,303
Total allocated and unallocated expenses		15,565			1,468			28,336
(Loss) income from operations		(2,287	)		4,335			(9,255	)
Interest expense		—			—			(2,107	)
Interest income		—			—			242
Other income		—			—			864
(Loss) income before benefit from income taxes	$	(2,287	)	$	4,335		$	(10,256	)

Year Ended December 31, 2023	Dermatology Recurring Procedures			Dermatology Procedures Equipment			Total
Revenues	$	21,530		$	11,828		$	33,358
Cost of revenues		8,729			6,168			14,897
Gross profit		12,801			5,660			18,461
Gross profit %		59.5	%		47.9	%		55.3	%
Allocated expenses:
Engineering and product development		1,011			306			1,317
Selling and marketing		11,169			1,787			12,956
Impairment of goodwill		2,284			—			2,284
Unallocated expenses		—			—			10,508
Total allocated and unallocated expenses		14,464			2,093			27,065
(Loss) income from operations		(1,663	)		3,567			(8,604	)
Interest expense		—			—			(1,640	)
Interest income		—			—			231
Loss on debt extinguishment		—			—			(909	)
(Loss) income before benefit from income taxes	$	(1,663	)	$	3,567		$	(10,922	)

For the years ended December 31, 2024 and 2023, depreciation and amortization by reportable segment were as follows (in thousands):

	Year Ended December 31,
	2024		2023
Dermatology recurring procedures	$	4,471	$	4,793
Dermatology procedures equipment		485		746
Unallocated expenses		12		14
Total	$	4,968	$	5,553

The following tables present the Company’s revenue disaggregated by geographical region for the years ended December 31, 2024 and 2023 (in thousands). Domestic refers to revenue from customers based in the United States, and foreign revenue is derived from the Company’s distributors primarily in Asia.

Year Ended December 31, 2024	Dermatology Recurring Procedures		Dermatology Procedures Equipment		Total
Domestic	$	19,531	$	1,357	$	20,888
China		—		4,069		4,069
Other foreign		1,640		6,965		8,605
Total	$	21,171	$	12,391	$	33,562

Year Ended December 31, 2023	Dermatology Recurring Procedures		Dermatology Procedures Equipment		Total
Domestic	$	20,215	$	2,813	$	23,028
China		—		3,340		3,340
Other foreign		1,315		5,675		6,990
Total	$	21,530	$	11,828	$	33,358

As of December 31, 2024 and 2023, total assets by reportable segment were as follows (in thousands):

	December 31,
	2024		2023
Dermatology recurring procedures	$	21,750	$	28,137
Dermatology procedures equipment		5,081		5,507
Other unallocated assets		9,326		8,372
Total	$	36,157	$	42,016

Long-lived assets of $1.3 million and $0.8 million were located in international markets, primarily Korea and Japan, as of December 31, 2024 and 2023, respectively, with the remainder located in domestic markets.