This article first appeared on GuruFocus .
Release Date: November 04, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Dietary supplements revenue grew 7.3% to $12.0 million, driven by continued growth in the e-commerce channel.
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Gross margin improved 231 basis points sequentially from Q2 2026 as the mix of pellets shifted back to internally manufactured pellets.
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Asteria Health has returned to pre-recall levels and will supply over 50% of shipped pellets, up from 30% in Q2 2026, supporting further gross margin improvement.
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SG&A decreased 20.8% relative to Q2 2026, primarily due to reduced legal settlements and other legal-related expenses.
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Biote Corp maintains full-year 2026 financial guidance of revenue above $175 million and adjusted EBITDA above $25 million.
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Recent improvement in procedure volume provides early evidence of stabilization in underlying demand.
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The company is leveraging data and analytics to identify clinics needing support, guide sales coaching, and hold commercial teams accountable.
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Biote Corp is upgrading its sales force, having added almost 50 new sales reps, which is beginning to show benefits in clinic engagement and same-store sales growth in some regions.
Negative Points
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Total revenue decreased 9.6% to $43.3 million, with procedure revenue declining 15.1% to $28.9 million due to the voluntary recall in January 2026.
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Gross margin was 67.7% compared to 71.8% in the prior year, primarily due to increased use of lower-margin third-party pellets.
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Net income was $0.6 million and diluted EPS was $0.01, down significantly from net income of $9.2 million and EPS of $0.22 in Q3 2025.
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Adjusted EBITDA decreased to $5.1 million with an adjusted EBITDA margin of 11.7%, reflecting lower revenue and margin pressures.
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Cash and cash equivalents decreased to $8.9 million as of September 30, 2026, from $11.2 million as of June 30, 2026.
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The return to growth is progressing more slowly than anticipated, with procedure revenue growth not yet restored.
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The company faces challenges in improving sales productivity and practitioner engagement, which are essential to restoring long-term procedure revenue growth.
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Attrition remains a concern, and the company is working to manage it while also driving new customer growth.
Q & A Highlights
Q: Why has procedure revenue growth materialized more slowly than expected, and which of the three key driversnew customer growth, same-store sales, or attritionhas disappointed? A: Bob Peterson (Interim CEO and CFO) explained that the first half of 2026 was consumed by recall-related clinic attention, and the company has since added nearly 50 new sales reps, requiring time to build pipelines and change the culture. He cited one competitive region where replacing legacy reps with more proactive ones drove same-store sales growth and competitive wins, and said this playbook is replicable across regions but takes time.
Q: What procedure trends did you see through the quarter and into Octoberare things improving or just stabilizing, and is pressure from existing practitioners doing fewer procedures or fewer active practitioners? A: Bob Peterson (Interim CEO and CFO) said the company saw modest average daily procedure volume increases during the quarter, but more work is needed for sustained improvement. He emphasized new customer growth, same-store sales, minimizing attrition, and competitive wins, with face-to-face rep activity as the most important lever.
Q: What internal metrics are you watching to determine whether improved sales productivity and practitioner engagement efforts are actually working? A: Bob Peterson (Interim CEO and CFO) said the company now has more data than ever, enabling accountability for commercial teams on activity and performance. The focus is on driving face-to-face interactions to win new customers and expand existing accounts, supported by daily measurement of clinic retention, procedure volume, and sales productivity.
Q: How should we think about a normalized revenue growth algorithm and the relative contributions from procedures and supplements? A: Bob Peterson (Interim CEO and CFO) said the primary goal is driving new customer growth, establishing same-store sales, and mitigating attrition. He noted the organization is upgrading and changing its culture, which takes time to reach a more normalized growth level, and that managing attrition while adding new customers are both essential.
Q: What is the outlook for gross margin improvement as Asteria Health ramps back up, and are there SG&A efficiency opportunities for 2027? A: Bob Peterson (Interim CEO and CFO) said gross margin improved sequentially in Q3 as the pellet mix shifted back to internally manufactured product, and he expects similar gross margin profiles to prior periods as Asteria supplies over 50% of shipped pellets. On SG&A, he said it is too early to discuss 2027 but the company continuously evaluates efficiencies to deploy assets for the highest return.
Q: When targeting practitioners, how are you balancing recruiting new practitioners versus retaining existing ones? A: Bob Peterson (Interim CEO and CFO) described an annuity model requiring three things done well: driving new customer growth as the "lifeblood" of the operation, quickly making new clinics productive, and growing same-store sales while managing attrition through consistent face-to-face engagement. He said the company has seen same-store sales success in revamped competitive regions.
Q: Has the economics for practitioners or clinics changed in a way that affects their focus on Biote products? A: Bob Peterson (Interim CEO and CFO) said there is strong practitioner desire to expand into the hormone space and develop patients from within their existing portfolios, a key value-add of the sales force in quarterly business reviews. He said the company has not seen a big shift in practitioner economics.
Q: What has end-consumer health and spending behavior been likehave you seen any notable shifts? A: Bob Peterson (Interim CEO and CFO) said the company has not seen any notable shifts in consumer behavior or spending, and its area remains fairly strong.
Q: What drove the Q3 revenue decline and the gross margin compression? A: Bob Peterson (Interim CEO and CFO) reported revenue fell 9.6% to $43.3 million, with procedure revenue down 15.1% to $28.9 million due to the January 2026 voluntary recall, while dietary supplements grew 7.3% to $12.0 million on e-commerce strength. Gross margin was 67.7% versus 71.8%, reflecting increased use of lower-margin third-party pellets, though it improved 231 basis points sequentially.
Q: What is the status of the full-year 2026 guidance and the company's cash position? A: Bob Peterson (Interim CEO and CFO) maintained full-year 2026 guidance of revenue above $175 million and adjusted EBITDA above $25 million, citing encouraging recent procedure trends. Cash and cash equivalents were $8.9 million as of September 30, 2026, down from $11.2 million at June 30, with Q3 operating cash flow of $3.7 million.
Q: What are the Chief Medical Officer's priorities for strengthening practitioner engagement? A: Dr. Kamal Bajaj (Chief Medical Officer) said her priorities center on clinical excellence and consistent, evidence-based education, shaped by practitioner feedback from initial training through continued development. She cited an advanced training event in Nashville with over 100 clinicians as evidence of Biote's investment in clinical education and its goal of being a continuing source of clinical expertise for practitioners.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
