BioStem Technologies, Inc. (OTC: BSEM), a regenerative medicine company, reported its first quarter 2026 financial results, highlighting a strategic transformation following its acquisition of BioTissue assets. The company generated net revenue of $6.1 million for the quarter ended March 31, 2026, compared to $16.0 million in the same period last year. The decline reflects a deliberate shift in focus toward the hospital market, which accounted for approximately 87% of total revenue, or $5.4 million, while physician office revenue contributed $0.8 million.
Gross profit was $3.8 million, representing a gross margin of 61%, down from 95% in the first quarter of 2025. The decrease is attributed to a product mix shift to Neox® and Clarix® products, which are subject to a cost-plus markup under the current manufacturing supply agreement. The company expects gross margin to improve significantly upon the completion of the planned manufacturing technology transfer in 2027.
Operating expenses totaled $12.6 million, down from $17.3 million in the fourth quarter of 2025, primarily due to a bad debt expense recorded in the prior quarter, partially offset by costs related to the acquired workforce and the BioTissue transaction. GAAP net loss was $8.8 million, or $0.52 per share, compared to net income of $3.9 million, or $0.23 per share, in the first quarter of 2025. Adjusted EBITDA was negative $5.7 million, versus positive $7.8 million a year earlier.
Chairman and CEO Jason Matuszewski said, “The first quarter of 2026 marked the beginning of a strategic transformation for BioStem, as we completed our acquisition of the surgical and wound care assets from BioTissue and repositioned the company as a fully integrated, hospital-focused commercial organization.” He added that the company expanded its direct sales force to 35 representatives, up from 18 at the close of the acquisition, and made progress on commercial integration.
BioStem also advanced its capital markets strategy by issuing audited financial statements for 2024 and 2025, moving toward a planned Nasdaq uplisting. The company retired outstanding debt with GMA, resolving two promissory notes with an aggregate principal of $3 million and accrued interest of $2.3 million. As of March 31, 2026, cash and cash equivalents totaled $13.7 million, down from $29.5 million at the end of 2025.
For full-year 2026, BioStem expects revenue in the range of $25 million to $29 million, with sequential growth anticipated in the second half as integration of the acquired assets continues and the physician office market stabilizes. The company believes its achievements in the first quarter have built a platform for durable long-term growth. More details are available in the company’s newsroom at https://tinyurl.com/bsemnewsroom.
