AtriCure, Inc.

Previous wording

This Form 10-Q contains forward-looking statements. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933 and Section 21F of the Securities Exchange Act of 1934. All forward-looking information is inherently uncertain and actual results may differ materially from assumptions, estimates or expectations reflected or contained in the forward-looking statements as a result of various factors, including those set forth under “Risk Factors” and elsewhere in this quarterly report on Form 10-Q, and in our annual report on Form 10-K for the year ended December 31, 2024 as amended by our subsequent quarterly report on Form 10-Q. There may be additional risks of which we are not presently aware or that we currently believe are immaterial which could have an adverse impact on our business. Forward-looking statements often address our expected future business, financial performance, financial condition and results of operations, and often contain words such as “intends,” “estimates,” “anticipates,” “hopes,” “projects,” “plans,” “expects,” “drives,” “seek,” “believes,” “see,” “focus,” “should,” “will,” “would,” “opportunity,” “outlook,” “could,” “can,” “may,” “future,” “predicts,” “target,” “potential,” "forecast," "trend," "might" and similar expressions and the negative versions of those words, and may be identified by the context in which they are used. However, the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements include, without limitation, statements that address activities, events, circumstances or developments that AtriCure expects, believes or anticipates will or may occur in the future, such as earnings estimates (including projections and guidance), other predictions of financial performance, launches by AtriCure of new products, developments with competitors and market acceptance of AtriCure's products. Such statements are based largely upon current expectations of AtriCure. Reliance should not be placed on forward-looking statements because they involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to different materially from those expressed or implied. Forward-looking statements are based on AtriCure’s expectations, experience and perception of current conditions, trends, expected future developments and other factors it believes are appropriate under the circumstances and are subject to numerous risks and uncertainties, many of which are beyond AtriCure’s control. In light of these risks, uncertainties and other factors, the forward-looking events and circumstances described may not occur and our financial condition and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements. In other words, these statements are not guarantees of future per…

Excerpt shortened here; the source contains the full paragraph.

Current wording

This Form 10-Q contains forward-looking statements. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933 and Section 21F of the Securities Exchange Act of 1934. All forward-looking information is inherently uncertain and actual results may differ materially from assumptions, estimates or expectations reflected or contained in the forward-looking statements as a result of various factors, including those set forth under “Risk Factors” and elsewhere in this quarterly report on Form 10-Q, and in our annual report on Form 10-K for the year ended December 31, 2024 as amended by our subsequent quarterly reports on Form 10-Q. There may be additional risks of which we are not presently aware or that we currently believe are immaterial which could have an adverse impact on our business. Forward-looking statements often address our expected future business, financial performance, financial condition and results of operations, and often contain words such as “intends,” “estimates,” “anticipates,” “hopes,” “projects,” “plans,” “expects,” “drives,” “seek,” “believes,” “see,” “focus,” “should,” “will,” “would,” “opportunity,” “outlook,” “could,” “can,” “may,” “future,” “predicts,” “target,” “potential,” "forecast," "trend," "might" and similar expressions and the negative versions of those words, and may be identified by the context in which they are used. However, the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements include, without limitation, statements that address activities, events, circumstances or developments that AtriCure expects, believes or anticipates will or may occur in the future, such as earnings estimates (including projections and guidance), other predictions of financial performance, launches by AtriCure of new products, developments with competitors and market acceptance of AtriCure's products. Such statements are based largely upon current expectations of AtriCure. Reliance should not be placed on forward-looking statements because they involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to different materially from those expressed or implied. Forward-looking statements are based on AtriCure’s expectations, experience and perception of current conditions, trends, expected future developments and other factors it believes are appropriate under the circumstances and are subject to numerous risks and uncertainties, many of which are beyond AtriCure’s control. In light of these risks, uncertainties and other factors, the forward-looking events and circumstances described may not occur and our financial condition and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements. In other words, these statements are not guarantees of future pe…

Excerpt shortened here; the source contains the full paragraph.

Previous wording

We are a leading innovator in treatments for atrial fibrillation (Afib), left atrial appendage (LAA) management and post-operative pain management. Our ablation and left atrial appendage management (LAAM) products are used by physicians during both open-heart and minimally invasive procedures. In open-heart procedures, the physician is performing heart surgery for other conditions and our products are used in conjunction with (or “concomitant” to) such a procedure. Minimally invasive procedures are performed on a standalone basis, and often include multi-disciplinary or “hybrid” approaches, combining surgical procedures using AtriCure ablation and LAAM products with catheter ablation procedures performed by electrophysiologists. Our pain management devices are used by physicians to freeze nerves during cardiothoracic or thoracic surgical procedures. We anticipate that substantially all of our revenue for the foreseeable future will relate to products we currently sell or are in the process of developing.

Current wording

We are a leading innovator in treatments for atrial fibrillation (Afib), left atrial appendage (LAA) management and post-operative pain management. Our ablation and left atrial appendage management (LAAM) products are used by physicians during both open-heart and minimally invasive surgical procedures. In open-heart procedures, the physician is performing heart surgery for other conditions and our products are used in conjunction with (or “concomitant” to) such a procedure. Minimally invasive procedures are performed on a standalone basis, and often include multi-disciplinary or “hybrid” approaches, combining surgical procedures using AtriCure ablation and LAAM products with catheter ablation procedures performed by electrophysiologists. Our pain management devices are used by physicians to ablate peripheral nerves, providing pain relief in cardiac, thoracic and amputation procedures. We anticipate that substantially all of our revenue for the foreseeable future will relate to products we currently sell or are in the process of developing.

Previous wording

We sell our products to medical centers through our direct sales force in the United States, Germany, France, the United Kingdom, the Benelux region, Australia and Canada. We also sell our products through distributors who in turn sell our products to medical centers in other markets. Our business is primarily transacted in U.S. Dollars; direct sales transactions outside the United States are transacted in Euros, British Pounds, Australian Dollars or Canadian Dollars.

Current wording

We sell our products to medical centers through our direct sales force in the United States, Germany, France, the United Kingdom, the Benelux region, Australia and Canada. We also sell our products through distributors who in turn sell our products to medical centers in other markets. Our business is primarily transacted in U.S. Dollars; direct sales outside the United States are transacted in Euros, British Pounds, Australian Dollars or Canadian Dollars.

Previous wording

In 2025, we continued to realize strong growth across most of our key franchises and geographies, resulting from our continued strategic initiatives of product innovation, clinical science and physician education and training to expand awareness and adoption. Our worldwide revenue for the six months ended June 30, 2025 was $259,759, representing an increase of $34,639, or 15.4% (15.3% on a constant currency basis), over the first six months of 2024, highlighted by accelerated adoption in our appendage management and pain management product lines, where recent product launches contributed to growth. Historically there have been limited competitors in our key markets. However, new entrants are developing competing products, procedures, and/or clinical solutions that may cause variability in our results.

Current wording

In 2025, we continued to realize strong growth across most of our key franchises and geographies, resulting from our strategic initiatives of product innovation, clinical science and physician education and training to expand awareness and adoption. Our worldwide revenue for the nine months ended September 30, 2025 was $394,028, representing an increase of $52,998, or 15.5% (15.3% on a constant currency basis), over the first nine months of 2024, highlighted by accelerated adoption in our appendage management and pain management product lines, where recent product launches contributed to growth. There are limited competitors in our key markets; however, new entrants are developing competing products, procedures, and/or clinical solutions that may cause variability in our results.

Previous wording

•In April 2025, FDA granted 510(k) clearance for the cryoICE® cryoXT™ probe, a cryoablation device designed specifically for Cryo Nerve Block therapy to alleviate pain in amputation patients. This device temporarily blocks pain by freezing target peripheral nerves, blocking the conduction pathway at the site of amputation. We expect to launch the cryoXT probe in the second half of 2025.

Current wording

Pain management. During the third quarter of 2025, we launched the cryoICE® cryoXT™ probe in the United States. The cryoXT probe is a cryoablation device designed specifically for Cryo Nerve Block therapy to alleviate pain in amputation patients. This device temporarily blocks pain by freezing target peripheral nerves, preventing the conduction pathway at the site of amputation.

Previous wording

LeAAPS. The Left Atrial Appendage Exclusion for Prophylactic Stroke Reduction (LeAAPS) IDE clinical trial is designed to evaluate the effectiveness of prophylactic LAA exclusion using the AtriClip LAA Exclusion System for the prevention of ischemic stroke or systemic arterial embolism in cardiac surgery patients without pre-operative AF diagnosis who are at risk for these events. This prospective, multicenter, randomized trial evaluates safety at 30 days post-procedure to demonstrate no increased risk with LAA exclusion during cardiac surgery, and efficacy over a minimum follow-up of five years post procedure. The first patient was enrolled in the trial in January 2023, and in July 2025, we completed trial enrollment of 6,500 patients across 137 centers globally.

Current wording

LeAAPS. The Left Atrial Appendage Exclusion for Prophylactic Stroke Reduction (LeAAPS) IDE clinical trial is designed to evaluate the effectiveness of prophylactic LAA exclusion using the AtriClip LAA Exclusion System for the prevention of ischemic stroke or systemic arterial embolism in cardiac surgery patients without pre-operative AF diagnosis who are at risk for these events. This prospective, multicenter, randomized trial evaluates safety at 30 days post-procedure to demonstrate no increased risk with LAA exclusion during cardiac surgery, and efficacy over a minimum follow-up period of five years post procedure. In July 2025, we completed trial enrollment of 6,500 patients across 137 centers globally. Patient follow-up for a minimum of five years post procedure is required by the study protocol and remains ongoing.

Previous wording

BoxX-NoAF. The EnCompass clamp and the AtriClip in Box Lesion and Left Atrial Appendage EXclusion Procedure for the Prevention of New Onset of Atrial Fibrillation (BoxX-NoAF) IDE trial will evaluate the impact of concomitant ablation and LAA exclusion in non-AF patients for the reduction of post-operative AF (POAF) and Clinical AF. This prospective, multi-center, multi-national randomized trial evaluates safety at 30 days post-procedure for POAF and secondary effectiveness for Clinical AF through three years. The trial provides enrollment of up to 960 subjects. FDA approved the trial protocol during the fourth quarter of 2024, and we expect site initiation and enrollment to begin later this year.

Current wording

BoxX-NoAF. The Box Lesion and Left Atrial Appendage EXclusion Procedure for the Prevention of New Onset of Atrial Fibrillation (BoxX-NoAF) IDE trial evaluates the impact of concomitant ablation using the EnCompass clamp and LAA exclusion with the AtriClip system in non-AF patients for the reduction of post-operative AF (POAF) and Clinical AF. This prospective, multi-center, multi-national randomized trial evaluates safety at 30 days post-procedure for POAF and secondary effectiveness for Clinical AF through three years. The trial provides enrollment of up to 960 subjects. FDA approved the trial protocol during the fourth quarter of 2024 and during October 2025, we completed the first patient enrollment. Site initiation and enrollment is ongoing.

Previous wording

Worldwide revenue increased 17.1% (16.5% on a constant currency basis). In the United States, sales grew in most product lines with significant contribution from our AtriClip® FLEX-Mini™ for appendage management and our cryoSPHERE MAX™ probe for post-operative pain management, both launched in the second half of 2024, and our EnCompass® clamp for open ablation. Minimally invasive ablation and minimally invasive appendage management sales declined during the quarter as physicians referred fewer patients for Hybrid procedures. International sales increased 23.3% (19.9% on a constant currency basis), with broad growth across our franchises and geographic regions.

Current wording

Worldwide revenue increased 15.8% (15.1% on a constant currency basis). In the United States, sales grew in most product lines with significant contribution from our AtriClip® FLEX-Mini™ device for appendage management, our EnCompass® clamp for open ablation and our cryoSPHERE MAX™ probe for post-operative pain management. Minimally invasive ablation sales declined during the quarter from continued reduction in Hybrid procedures as physicians adopt PFA catheters to treat patients. International sales increased 22.0% (17.9% on a constant currency basis), with broad growth across all of our franchises and most geographic regions.

Previous wording

Cost of revenue and gross margin. Cost of revenue increased $5,232 primarily reflecting higher sales volumes. Gross margin decreased 15 basis points, driven by less favorable geographic and product mix.

Current wording

Cost of revenue and gross margin. Cost of revenue increased $3,820 primarily reflecting higher sales volumes. Gross margin increased 59 basis points, driven by favorable product mix.

Previous wording

Selling, general and administrative expenses. Selling, general and administrative expenses increased $4,794, or 6.5%, driven by a $6,081 increase in personnel costs, primarily reflecting headcount growth. These increases were partially offset by lower marketing and training costs of $803 and travel costs of $537.

Current wording

Selling, general and administrative expenses. Selling, general and administrative expenses increased $4,994, or 6.8%, driven by a $5,629 increase in personnel costs, including travel and share-based compensation, as a result of growth in headcount and variable compensation. These increases were partially offset by lower consulting costs of $1,071.

Previous wording

Six months ended June 30, 2025 compared to six months ended June 30, 2024

Current wording

Nine months ended September 30, 2025 compared to nine months ended September 30, 2024

Previous wording

Worldwide revenue increased 15.4% (15.3% on a constant currency basis). In the United States, sales grew in most product lines with strong contribution from our cryoSPHERE MAX probe for post-operative pain management, AtriClip® FLEX-Mini for appendage management and our EnCompass clamp in open ablation. Minimally invasive ablation and minimally invasive appendage management sales declined in the first half of the year as physicians referred fewer patients for Hybrid procedures. International sales increased 22.1% (21.8% on a constant currency basis), with growth in major geographic markets across all product lines.

Current wording

Worldwide revenue increased 15.5% (15.3% on a constant currency basis). In the United States, sales grew across most product lines with strong contribution from our AtriClip FLEX-Mini device for appendage management, EnCompass clamp in open ablation and cryoSPHERE MAX probe for post-operative pain management. Sales for minimally invasive ablation devices declined as physicians referred fewer patients for Hybrid procedures. International sales increased 22.1% (20.5% on a constant currency basis), with growth in major geographic markets across all product lines.

Previous wording

Cost of revenue and gross margin. Cost of revenue increased $8,641 as a result of higher sales volumes with flat gross margin year over year.

Current wording

Cost of revenue and gross margin. Cost of revenue increased $12,461 as a result of higher sales volumes. Gross margin increased 23 basis points, driven by favorable product mix.

Previous wording

Research and development expenses. Research and development expenses increased $11,551 or 28.7%, driven by the first milestone payment of $5,000 for acquired IPR&D. Clinical trial expenses increased $4,210 driven by LeAAPS clinical trial patient enrollment and follow up activities. Personnel costs, including share-based compensation, increased $3,641 as a result of headcount growth. These increases were partially offset by a $912 reduction in regulatory filing costs as a result of the timing of product development initiatives.

Current wording

Research and development expenses. Research and development expenses increased $13,483 or 22.0%, driven by a $5,486 increase in personnel costs, including share-based compensation and travel, as a result of headcount growth and higher variable and share-based compensation. Additional increases include the second quarter milestone payment of $5,000 for the acquired IPR&D and $3,693 of clinical trial expenses for LeAAPS clinical trial patient enrollment and follow up activities. These increases were partially offset by a $879 reduction in regulatory filing costs as a result of the timing of product development initiatives.

Previous wording

Selling, general and administrative expenses. Selling, general and administrative expenses increased $8,508, or 5.8%, driven by a $10,312 increase in personnel costs, primarily reflecting headcount growth. These increases were partially offset by $1,086 decrease in marketing and training costs and $1,079 decrease in travel costs.

Current wording

Selling, general and administrative expenses. Selling, general and administrative expenses increased $13,502, or 6.2%, driven by a $14,862 increase in personnel costs, including travel and share-based compensation, primarily reflecting growth in headcount and variable and share-based compensation. This increase was partially offset by $1,102 decrease in marketing and training costs and $1,018 decrease in consulting costs.

Previous wording

Other income (expense). Other expense decreased $2,465, primarily due to the $1,362 loss on debt extinguishment during the first quarter of 2024. Net foreign currency transaction gain increased $653 and net interest expense decreased $437 from lower borrowing costs.

Current wording

Other income (expense). Other expense decreased $2,297, primarily due to the $1,362 loss on debt extinguishment during the first quarter of 2024. Net interest expense decreased $512 from lower borrowing costs, while net foreign currency transaction gain increased $402.

Previous wording

As of June 30, 2025, we had cash and cash equivalents of $117,796 and outstanding debt of $61,865. We had unused borrowing capacity of $61,885 (see Note 6 – Indebtedness for related discussion). All cash equivalents and most of our operating cash is held in United States financial institutions. A small portion of our cash is held in foreign banks to support our international operations. We had net working capital of $202,414 and an accumulated deficit of $414,692 as of June 30, 2025.

Current wording

As of September 30, 2025, we had cash and cash equivalents of $147,865 and outstanding debt of $61,865. We had unused borrowing capacity of $61,885 (see Note 6 – Borrowings and Financing Obligation for related discussion). All cash equivalents and most of our operating cash is held in United States financial institutions. A small portion of our cash is held in foreign banks to support our international operations. We had net working capital of $223,270 and an accumulated deficit of $414,959 as of September 30, 2025.

Previous wording

Consolidated Cash Flows - For the six months ended June 30, 2025 and 2024

Current wording

Consolidated Cash Flows - For the nine months ended September 30, 2025 and 2024

Previous wording

Cash flows provided by operating activities. Net cash provided by operating activities increased $24,227 from 2024 to 2025, reflecting improved operating results of $8,340, driven by higher sales and moderating growth in operating expenses. This improvement includes an adjustment of $5,000 related to the acquired IPR&D milestone payment. Cash used for working capital and other assets and liabilities decreased $9,958 primarily due to moderating investments in inventory.

Current wording

Cash flows provided by operating activities. Net cash provided by operating activities increased $30,939 from 2024 to 2025, reflecting improved operating results of $15,926, driven by higher sales and moderating expansion of operating expenses. This improvement includes an adjustment of $5,000 related to the acquired IPR&D milestone payment in 2025. Cash used for working capital and other assets and liabilities decreased $6,559 primarily due to moderating investments in inventory.

Previous wording

Cash flows used in investing activities. Net cash used in investing activities increased by $49,878 from 2024 to 2025 2024, due to a $45,668 decrease in sales and maturities of available-for-sale securities and the first acquired IPR&D milestone payment for $5,000.

Current wording

Cash flows used in investing activities. Net cash used in investing activities increased by $56,875 from 2024 to 2025, due to a $53,668 decrease in sales and maturities of available-for-sale securities and the first acquired IPR&D milestone payment for $5,000 in 2025.

Previous wording

Cash flows used in financing activities. Net cash used in financing activities increased by $1,898 in 2025. This increase was a result a $3,882 increase in shares repurchased for payment of taxes on stock awards, offset by a $1,616 reduction of payments for extinguishment of debt and financing fees from 2024.

Current wording

Cash flows used in financing activities. Net cash used in financing activities decreased by $4,419 in 2025. This decrease was a result of $6,250 in proceeds from the August 2025 sale-and-leaseback arrangement and a $1,679 reduction of payments for extinguishment of debt and financing fees from 2024. These improvements were offset by a $4,176 increase in shares repurchased for payment of taxes on stock awards.

Previous wording

For additional information on the terms and conditions, as well as applicable interest and fee payments, see Note 6 – Indebtedness.

Current wording

For additional information on the terms and conditions, as well as applicable interest and fee payments, see Note 6 – Borrowings and Financing Obligation.