Treace Medical Concepts, Inc. (NASDAQ: TMCI) narrowed its third-quarter net loss by 22.9% to $12.566 million, or $0.19 per diluted share, as the foot-and-ankle surgical device maker filed its Form 10-Q with the U.S. Securities and Exchange Commission on Friday, November 6. For shareholders, the quarterly report shows that 10% operating cost cuts helped the company halve its year-to-date cash burn and return to positive quarterly adjusted EBITDA even as top-line revenue dipped 3.9% to $48.253 million.
Both headline figures beat Wall Street expectations. Analysts tracked by MarketBeat had projected a loss of $0.25 per share on revenue of $47.80 million for the quarter ended September 30, 2026. In the third quarter of 2025, the Ponte Vedra, Florida-based company posted a net loss of $16.288 million, or $0.26 per diluted share, on revenue of $50.214 million.
What the Q3 10-Q filing shows on revenue and costs
According to the quarterly filing, the $1.961 million year-over-year revenue decrease stemmed from a $5.1 million drop in sales to stocking distributors and a product mix shift toward lower-priced minimally invasive implant kits. Excluding sales to stocking distributors, total bunion procedure kit volume increased and revenue grew in the mid-single digits compared with the prior-year period.
Gross profit for the third quarter stood at $38.350 million, down from $39.706 million a year earlier, while gross margin edged up to 79.5% from 79.1%. Total operating expenses fell by $5.5 million, or 10%, to $49.9 million from $55.4 million in the third quarter of 2025, driven by targeted expense reductions and lower tariff costs. That drop narrowed Treace’s operating loss to $11.532 million from $15.676 million a year ago.
Adjusted EBITDA—earnings before interest, taxes, depreciation, and amortization, stripping out non-cash items like stock-based compensation—swung by $2.9 million to a positive $0.309 million ($309,000), compared with an adjusted EBITDA loss of $2.593 million in the third quarter of 2025.
In the company’s earnings release via GlobeNewswire, Chief Executive Officer and Chairman John T. Treace said the company was encouraged by double-digit case volume growth and market share gains as surgeons adopted its newer bunion systems and foot-and-ankle instruments.
“We continue to make disciplined investments in key growth initiatives with an emphasis on our product pipeline, while staying focused on improving profitability and reducing cash usage.”
Product adoption and liquidity position
Treace produces surgical implants and instruments centered on its Lapiplasty 3D Bunion Correction System. After introducing three additional minimally invasive osteotomy and bunion systems in the third quarter of 2025 to compete across more procedure types, the company saw higher procedure kit volumes alongside lower average selling prices per case.
During the third quarter of 2026, roughly 45% of Lapiplasty surgeon users incorporated at least one of those three newer bunion systems, up from 40% in the second quarter of 2026. The 10-Q filing also noted full market releases for the SpeedTMT system, SuperBite Compression Screws, and VitaFuse Bioactive Glass Graft, alongside limited market releases for HyperPlate XM, CartiBlaster, and Lapiplasty Lightning instrumentation. During the quarter, the company also released five-year clinical study results for its Lapiplasty procedure.
Year-to-date cash usage dropped 53%, or $9.7 million, over the first nine months of 2026 compared with the same period in 2025. That follows a first half of 2026 in which Treace generated $92.574 million in six-month revenue and recorded a net loss of $0.52 per share. As of September 30, 2026, Treace held $39.8 million in cash, cash equivalents, and marketable securities, down from $45.619 million at the end of the second quarter, with up to $115 million in additional borrowing capacity available under its existing credit facility subject to lending conditions.
Market reaction and full-year 2026 guidance
Despite the narrower quarterly loss, shares of Treace Medical Concepts fell $0.15, or 3.6%, during midday trading on Friday, November 6, to $4.03 on volume of 596,717 shares, giving the company a market capitalization of $262.09 million. According to MarketBeat, corporate insiders own 23.42% of the company’s stock following an August 20 purchase of 39,944 shares by John T. Treace at an average price of $4.44 per share ($177,351.36 total), which brought the CEO’s direct holdings to 7,388,383 shares. Across seven covering analysts tracked by MarketBeat, the stock carries one Buy, four Hold, and two Sell ratings, with an average price target of $5.17.
For full-year 2026, Treace narrowed its revenue guidance to a range of $206 million to $210 million, which represents a 1% to 3% decline from full-year 2025 revenue. Management projected a full-year 2026 adjusted EBITDA loss between $1 million and $2 million, an improvement over the $3.9 million adjusted EBITDA loss in 2025, and reiterated its forecast to cut full-year cash usage by roughly 50% compared with 2025. The company expects revenue to return to year-over-year growth in the fourth quarter of 2026 during its seasonally busiest surgical period.