On Tuesday, Avita Medical, Inc. ( RCEL ) revised its revenue guidance for the fourth quarter and full year of 2024.

The regenerative medicine company adjusted its projections due to slower-than-expected purchasing by hospital accounts.

Avita, which specializes in wound care and skin restoration, anticipates fourth-quarter commercial revenue of approximately $18.4 million. It reflects a 30% year-over-year increase. However, this is below its earlier guidance of $22.3 million to $24.3 million and consensus of $23.14 million.

Full-year 2024 revenue is projected to be $64.3 million. That’s up 29% from 2023. However, it’s below the previously forecasted range of $68 million to $70 million and the consensus of $68.97 million.

Avita attributed the shortfall to year-end inventory adjustments by several hospital accounts, which delayed purchasing activity in December. CEO Jim Corbett expects normal purchasing patterns to resume in early 2025. Deferred sales will contribute to future quarters.

Despite the revised outlook, Avita Medical ( RCEL ) continued to expand its business in 2024. It launched new products and integrated an expanded sales team.

Key product launches included PermeaDerm, a transparent wound matrix, and RECELL GO, a next-generation device for wound treatment, along with its smaller version, RECELL GO mini.

In December, the company introduced Cohealyx, a collagen-based dermal matrix co-developed with Regenity Biosciences, which enhances its offerings for wound care solutions.

Corbett emphasized the company’s progress in scaling its operations, stating, “We grew our revenue in 2024 by approximately 29% over the prior year. Our strategic investments in people and products position us for continued growth and success.”

Looking ahead, Avita provided financial guidance for 2025, projecting commercial revenue between $100 million and $106 million—a 55% to 65% increase from 2024 compared to the consensus of $105.68 million. The company also adjusted its timeline for achieving cash flow break-even and GAAP profitability to the fourth quarter of 2025, shifting from its previous forecast of the third quarter.

Price Action: RCEL stock is down 36.1% at $8.98 at last check Wednesday.

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