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What changed in Airsculpt Technologies, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Airsculpt Technologies, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+335 added−323 removedSource: 10-K (2026-03-31) vs 10-K (2025-03-14)

Top changes in Airsculpt Technologies, Inc.'s 2025 10-K

335 paragraphs added · 323 removed · 257 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

51 edited+7 added−17 removed103 unchanged
Biggest changeOur Growth Strategies We intend to deliver long-term growth in revenue and profitability by executing on the following strategies: • Continue to Grow Our Brand Awareness and Attract New Patients: We believe that consumer trends towards greater acceptance of body contouring and cosmetic treatments will continue to expand the market for our services. 4 Table of Contents We believe we are a leading provider of body contouring procedures and that there is a significant opportunity to drive awareness and adoption of our AirSculpt ® method and procedure offerings. • Continue to Drive Sales Growth of Our Centers: We employ the following strategies to increase our procedures performed and drive higher revenue per procedure in existing centers: ◦ Increase speed and efficiency of patient onboarding to increase utilization and reduce patient waiting times: We have and will continue to execute initiatives that increase the speed through which patients convert from initial consultation to procedure.
Biggest changeWe believe we are a leading provider of body contouring procedures and that there is a significant opportunity to drive awareness and adoption of our AirSculpt ® method and procedure offerings. • Drive Sales Growth of Our Centers: We employ the following strategies to increase our procedures performed and drive higher revenue per procedure in existing centers: ◦ Increase speed and efficiency of patient onboarding to increase utilization and reduce patient waiting times: We have and will continue to execute initiatives that increase the speed through which patients convert from initial consultation to procedure.
AirSculpt ® , AirSculpt+®, AirSculpting ® , AirSculpt Plus ® , Elite Body Sculpture®, RevisionSculpt®, AirSculpt Lift ™ , No Needle, No Scalpel, No Stitches ® , If You Can Pinch It, We Can Take It ® , Power BBL ® , Tiny Tuck ® , 48 Hour Six Pack ® , Cure for the Hip Dip ® , Hip Flip ® , CankCure ® , Stubborn Fat, It’s All We Do®, The 48 Hour Difference™, and our logo are U.S. registered trademarks or trademarks for which registration is pending in the United States.
AirSculpt ® , AirSculpt+®, AirSculpting ® , AirSculpt Plus ® , Elite Body Sculpture®, RevisionSculpt®, AirSculpt Lift ™ , No Needle, No Scalpel, No Stitches ® , If You Can Pinch It, We Can Take It ® , Power BBL ® , Tiny Tuck ® , 48 Hour Six Pack ® , Cure for the Hip Dip ® , Hip Flip ® , CankCure ® , Stubborn Fat, It’s All We Do®, The 48 Hour Difference™, and our registered 'hourglass' logo are U.S. registered trademarks or trademarks for which registration is pending in the United States.
While we believe we are transforming and growing the body contouring market, our primary competition includes individual and small practice group providers of traditional liposuction, which we believe require a longer patient recovery time than AirSculpt ® and some national providers of other minimally-invasive techniques, which we believe are less effective than AirSculpt ® .
While we believe we are transforming the body contouring market, our primary competition includes individual and small practice group providers of traditional liposuction, which we believe require a longer patient recovery time than AirSculpt ® and some national providers of other minimally-invasive techniques, which we believe are less effective than AirSculpt ® .
We employ the following strategies to expand our footprint: • Expand Footprint by Opening New Centers in the United States: We believe our track record of successfully opening new AirSculpt centers consistently generating strong unit-level economics validates our strategy across the United States.
We employ the following strategies to expand our footprint: • Expand Footprint by Opening New Centers in the United States: We believe our track record of successfully opening new AirSculpt centers generating strong unit-level economics validates our strategy across the United States.
By using web-based lead generation, we generate over 400,000 monthly website visits, primarily through optimized spend on Google’s marketing engine. • Celebrity endorsements: We collaborate with celebrity influencers and TV personalities to drive continuous media coverage that raises brand awareness and social acceptance of our procedures. • Patient testimonials: Our patients are some of the best advocates for our brand, with many recommending our procedures to family and friends.
By using web-based lead generation, we generate over 625,000 monthly website visits, primarily through optimized spend on Google’s marketing engine. • Celebrity endorsements: We collaborate with celebrity influencers and TV personalities to drive continuous media coverage that raises brand awareness and social acceptance of our procedures. • Patient testimonials: Our patients are some of the best advocates for our brand, with many recommending our procedures to family and friends.
We believe there is a significant North American growth opportunity of over 200 potential locations in the U.S. and Canada and will continue to opportunistically evaluate new center openings. 6 Table of Contents Our Technique, Training and Equipment AirSculpt ® is a proprietary, patented method of tumescent liposuction that removes unwanted fat from several targeted areas of the body in a minimally invasive procedure, producing dramatic results.
We believe there is a significant North American growth opportunity of over 200 potential locations in the U.S. and Canada and will continue to opportunistically evaluate new center openings. 5 Table of Contents Our Technique, Training and Equipment AirSculpt ® is a proprietary, patented method of tumescent liposuction that removes unwanted fat from several targeted areas of the body in a minimally invasive procedure, producing dramatic results.
The imposition of these regulatory requirements may have the effect of increasing operating costs and reducing the profitability of our operations. 11 Table of Contents State Corporate Practice of Medicine and Fee-Splitting Laws The laws in many of the states in which we operate or may in the future operate, prohibit entities owned by non-physicians from practicing medicine, exercising control over surgeons, employing surgeons or otherwise interfering with the independent professional judgment of surgeons.
The imposition of these regulatory requirements may have the effect of increasing operating costs and reducing the profitability of our operations. 10 Table of Contents State Corporate Practice of Medicine and Fee-Splitting Laws The laws in many of the states in which we operate or may in the future operate, prohibit entities owned by non-physicians from practicing medicine, exercising control over surgeons, employing surgeons or otherwise interfering with the independent professional judgment of surgeons.
Competition We believe that our brand recognition and minimally invasive procedures with results meeting or exceeding our customer expectations distinguish us in the growing market for body contouring.
Competition We believe that our brand recognition and minimally invasive procedures with results meeting or exceeding our customer expectations distinguish us in the market for body contouring.
By leveraging data-driven insights, we aim to allocate marketing resources more effectively across channels, ensuring that each dollar spent contributes to measurable business outcomes. 8 Table of Contents Our sales assistants respond to inquiries from prospective patients and schedule virtual or in-person consultations. We offer our patients the choice of a pre-procedure virtual consult.
By leveraging data-driven insights, we aim to allocate marketing resources more effectively across channels, ensuring that each dollar spent contributes to measurable business outcomes. 7 Table of Contents Our sales assistants respond to inquiries from prospective patients and schedule virtual or in-person consultations. We offer our patients the choice of a pre-procedure virtual consult.
The areas in which we compete include: • Patients: We compete for patients to utilize our procedures through our marketing efforts and exceptional brand reputation. 9 Table of Contents • Procedure Offering: We compete with providers of liposuction, abdominoplasty (tummy tuck) and gastric bypass surgery, weight-loss drugs and non-surgical procedures that use cooling, injected medication or heat to reduce fat cells.
The areas in which we compete include: • Patients: We compete for patients to utilize our procedures through our marketing efforts and exceptional brand reputation. 8 Table of Contents • Procedure Offering: We compete with providers of liposuction, abdominoplasty (tummy tuck) and gastric bypass surgery, weight-loss drugs and non-surgical procedures that use cooling, injected medication or heat to reduce fat cells.
Our Growth Drivers The market for surgical aesthetic procedures is growing, fueled by trends including: • Self-Image Awareness: increased consumer awareness and focus on beauty consciousness driven by social media and prioritization of healthy lifestyles; • Social Acceptance: consumers have embraced cosmetic treatment and reduced the social stigma, especially through the proliferation of shared patient photos on social media; • Improved Safety and Recovery Profile: advances in technology have led to reduced recovery times and introduction of more minimally-invasive procedures; • Rise in Disposable Income: the global rise in disposable income provides individuals with greater discretionary funds for personal appearance enhancements including cosmetic surgery; and • Increased Weight Gain in the Overall Population: worldwide prevalence of overweight and obesity in individuals continues to rise. • Increased use of GLP-1 Weight Loss Drugs: increasing use of weight loss drugs may lead to increased demand for body contouring and skin tightening procedures.
Our Business Drivers The market for surgical aesthetic procedures is driven by trends including: • Self-Image Awareness: increased consumer awareness and focus on beauty consciousness driven by social media and prioritization of healthy lifestyles; • Social Acceptance: consumers have embraced cosmetic treatment and reduced the social stigma, especially through the proliferation of shared patient photos on social media; • Improved Safety and Recovery Profile: advances in technology have led to reduced recovery times and introduction of more minimally-invasive procedures; • Rise in Disposable Income: the global rise in disposable income provides individuals with greater discretionary funds for personal appearance enhancements including cosmetic surgery; and • Increased Weight Gain in the Overall Population: worldwide prevalence of overweight and obesity in individuals continues to rise. • Increased use of GLP-1 Weight Loss Drugs: increasing use of weight loss drugs may lead to increased demand for body contouring and skin tightening procedures.
As part of our long-term growth strategy, we are focused on optimizing our marketing investment to enhance efficiency, improve return on investment, and drive sustainable revenue growth.
As part of our long-term growth strategy, we are focused on optimizing our marketing investment to enhance efficiency, improve return on investment, and return to sustainable revenue growth.
We also had contracts with approximately 97 surgeons. While each center varies depending on its size, case volume and case types, we employ an average of approximately 10 full-time equivalent employees at our centers. While we provide “full-time equivalent” information, a number of our employees work on flexible schedules rather than full-time, which increases our staffing efficiency.
We also had contracts with approximately 90 surgeons. While each center varies depending on its size, case volume and case types, we employ an average of approximately 10 full-time equivalent employees at our centers. While we provide “full-time equivalent” information, a number of our employees work on flexible schedules rather than full-time, which increases our staffing efficiency.
By offering flexible payment solutions, we aim to attract a broader customer base, improve conversion rates, and strengthen customer loyalty. Our Intellectual Property As of December 31, 2024, our patent portfolio is comprised of two issued U.S. utility patents, one pending U.S. utility patent application, and one International (PCT) patent application, each of which we own directly.
By offering flexible payment solutions, we aim to attract a broader customer base, improve conversion rates, and strengthen customer loyalty. Our Intellectual Property As of December 31, 2025, our patent portfolio is comprised of two issued U.S. utility patents, one pending U.S. utility patent application, and one International (PCT) patent application, each of which we own directly.
The amount of fat removed via the AirSculpt® method depends on patient body size, desired outcomes and state regulations. After the procedure is complete, a piece of dry gauze is used to cover the entryway to protect against infection. 7 Table of Contents Across our centers, we use a network of independent surgeons to perform the AirSculpt ® procedure.
The amount of fat removed via the AirSculpt® method depends on patient body size, desired outcomes and state regulations. After the procedure is complete, a piece of dry gauze is used to cover the entryway to protect against infection. 6 Table of Contents Across our centers, we use a network of independent surgeons to perform the AirSculpt ® procedure.
Nearly all of our patient-facing consultants are former patients and can speak to their personal AirSculpt experiences. Based on these efforts, together with discussions with our surgeons, our patients elect to move forward and schedule a procedure date. Many patients, satisfied with results and experience, return to AirSculpt to receive further AirSculpt ® treatments on additional body parts.
Many of our patient-facing consultants are former patients and can speak to their personal AirSculpt experiences. Based on these efforts, together with discussions with our surgeons, our patients elect to move forward and schedule a procedure date. Many patients, satisfied with results and experience, return to AirSculpt to receive further AirSculpt ® treatments on additional body parts.
We believe the systems and methodologies claimed in our issued patents provide impressive results with less patient trauma relative to other systems and methods, such as liposuction and abdominoplasty (tummy tuck), that require more invasive surgical procedures. • Broad Offering of Innovative, Body Sculpting Procedures: We offer our patients a comprehensive suite of customized body contouring procedures, including fat removal and fat transfer, to meet their wants and needs.
We believe the systems and methodologies claimed in our issued patents provide impressive results with less patient trauma relative to other systems and methods, such as liposuction and abdominoplasty (tummy tuck), that require more invasive surgical procedures. • Broad Offering of Innovative, Body Sculpting Procedures: We offer our patients a comprehensive suite of customized body contouring procedures, including fat removal, fat transfer, skin excisions and skin tightening to meet their wants and needs.
We encourage our patients to share their “before and after” photos on social media. 5 Table of Contents While we are not likely to open new centers in the near term due to initiatives to improve liquidity, we do believe opening new centers in North America remains a part of our long-term growth strategy.
We encourage our patients to share their “before and after” photos on social media. While we are not likely to open new centers in the near term due to initiatives to improve liquidity, we do believe opening new centers in North America remains a part of our long-term growth strategy.
We believe that the desire to be an AirSculpt surgeon has provided us with ready access to talented providers, making recruitment a selective process. Additionally, through referral and outreach, we plan to continue recruiting surgeons to perform procedures on our growing number of patients.
We believe that the desire to be an AirSculpt surgeon has provided us with ready access to talented providers, making recruitment a selective process. Additionally, through referral and outreach, we plan to continue recruiting surgeons to perform procedures on our patients.
From the initial consultation to the day of procedure, our patients are guided by knowledgeable patient care consultants. Our centers are located near high end retail environments, such as Rodeo Drive in Beverly Hills and Fifth Avenue in 3 Table of Contents New York.
From the initial consultation to the day of procedure, our patients are guided by knowledgeable patient care consultants. Our centers are located near high end retail environments, such as Rodeo Drive in Beverly Hills and Fifth Avenue in New York.
We believe we are in compliance with federal and state antitrust laws, but courts or regulatory authorities may reach a determination in the future that could have a material adverse effect on our business, prospects, results of operations and financial condition. Employees As of December 31, 2024, we employed approximately 389 full-time employees and approximately 33 part-time employees.
We believe we are in compliance with federal and state antitrust laws, but courts or regulatory authorities may reach a determination in the future that could have a material adverse effect on our business, prospects, results of operations and financial condition. Employees As of December 31, 2025, we employed approximately 330 full-time employees and approximately 33 part-time employees.
Unlike traditional liposuction which uses cannulae in a scraping motion, AirSculpt ® drives a cannula 1,000 times per minute in a corkscrew motion to remove fat cells while tightening skin simultaneously. It requires no needle, no scalpel, no stitches and no general anesthesia to create dramatically natural, smooth results.
Unlike traditional liposuction which uses cannulae in a scraping motion, AirSculpt ® drives a cannula 1,000 times per minute in a corkscrew motion to remove fat cells while tightening skin simultaneously. It requires no needle, 2 Table of Contents no scalpel, no stitches and no general anesthesia to create dramatically natural, smooth results.
We also continue to develop new procedures, such as the Hip Flip ® and CankCure ® , to meet our patients’ demand and drive traffic to our centers. ◦ Increase prices on procedures: We have an ability to increase prices on our procedures driven by the strong value proposition that our services offer to our patients. ◦ Optimizing Marketing Investment : As part of our long-term growth strategy, we are focused on optimizing our marketing investment to enhance efficiency, improve return on investment, and drive sustainable revenue growth.
We also continue to develop and introduce new procedures, such as the Hip Flip® and CankCure®, to meet patient demand and drive awareness and utilization of our centers. ◦ Increase prices on procedures: We have an ability to increase prices on our procedures driven by the strong value proposition that our services offer to our patients. ◦ Optimizing Marketing Investment : As part of our long-term growth strategy, we are focused on optimizing our marketing investment to enhance efficiency, improve return on investment, and drive sustainable revenue growth.
We believe our treatment results and elite patient experience have positioned AirSculpt as a preferred body contouring brand. We performed 14,036 body contouring procedures in 2024. Our proprietary and patented AirSculpt ® method is minimally invasive because it requires no needle, no scalpel, no stitches and no general anesthesia to achieve transformational change that appears both natural and smooth.
We believe our treatment results and elite patient experience have positioned AirSculpt as a preferred body contouring brand. We performed 11,852 body contouring procedures in 2025. Our proprietary and patented AirSculpt ® method is minimally invasive because it requires no needle, no scalpel, no stitches and no general anesthesia to achieve transformational change that appears both natural and smooth.
We do not face any risk in default of payment under that financing arrangement, which is solely between the patient and third-party financing vendor. In 2024, approximately 52% of our cases involved the patient securing third-party financing. We are focused on expanding consumer financing options to enhance affordability, increase customer accessibility, and drive sales growth.
We do not face any risk in default of payment under that financing arrangement, which is solely between the patient and third-party financing vendor. In 2025, approximately 50% of our cases involved the patient securing third-party financing. We are focused on expanding consumer financing options to enhance affordability, increase customer accessibility, and return to sales growth.
We believe our procedures offer dramatic results to our patients. 2 Table of Contents Our Competitive Strengths We attribute our success to the following strengths that differentiate us from our competitors: Trusted Brand Redefining Body Contouring The AirSculpt ® method was created to offer patients a gentler alternative to traditional fat removal procedures with transformative results delivered in a luxurious, spa-like environment.
Our Competitive Strengths We attribute our success to the following strengths that differentiate us from our competitors: Trusted Brand Redefining Body Contouring The AirSculpt ® method was created to offer patients a gentler alternative to traditional fat removal procedures with transformative results delivered in a luxurious, spa-like environment.
In addition to monitoring and managing our social media presence, our team is focused on search engine optimization on our digital platform. For the year ended December 31, 2024, our total advertising costs were $33.4 million, split approximately 90% digital advertising and 10% other advertising platforms.
In addition to monitoring and managing our social media presence, our team is focused on search engine optimization on our digital platform. For the year ended December 31, 2025, our total advertising costs were $27.3 million, split approximately 90% digital advertising and 10% other advertising platforms.
The tools we use to perform our fat removal and fat transfer procedures are purchased from third parties and we do not own the proprietary rights to such tools.
At least some of the tools we currently use to perform our fat removal and fat transfer procedures are purchased from third parties, and we do not own the proprietary rights to such tools.
Instead of protecting specific, individual liposuction components (such as a particular handpiece design), our issued patents and our pending applications relate to certain proprietary implementations of the process described in the section “Our Technique, Training and Equipment,” and the combination of multiple components to form proprietary systems that are specially configured for carrying out those proprietary processes.
Instead of protecting specific, individual liposuction components, our currently issued patents relate to certain proprietary implementations of the process described in the section “Our Technique, Training and Equipment,” and the combination of multiple components to form proprietary systems that are specially configured for carrying out those proprietary processes.
The increased market acceptance, availability and customer awareness of weight-loss drugs has changed the market for body fat reduction procedures. The increasing use of weight loss drugs may lead to increased demand for body contouring and skin tightening procedures. It is difficult to predict the long-term outlook of the market for weight-loss drugs, including their long-term efficacy and potential drawbacks.
The increasing use of weight loss drugs may lead to increased demand for body contouring and skin tightening procedures. It is difficult to predict the long-term outlook of the market for weight-loss drugs, including their long-term efficacy and potential drawbacks.
Selling expenses consist of advertising costs for social, digital and traditional marketing and sales and marketing personnel. Our total selling expenses for 2024 were approximately $43.9 million, or approximately 24.4% of revenue. Our customer acquisition costs were approximately $3,130 per customer in 2024.
Selling expenses consist of advertising costs for social, digital and traditional marketing and sales and marketing personnel. Our total selling expenses for 2025 were approximately $36.9 million, or approximately 24.3% of revenue. Our customer acquisition costs were approximately $3,114 per customer in 2025.
Securities and Exchange Commission (“SEC”). 13 Table of Contents
Securities and Exchange Commission (“SEC”). 12 Table of Contents
We deliver our body contouring procedures through a growing, nationwide footprint of 32 centers across 20 U.S. states, Canada, and the United Kingdom as of March 14, 2025. Our centers, located in metropolitan and suburban areas, offer a premium patient experience and luxurious, spa-like atmosphere.
We deliver our body contouring procedures through a nationwide footprint of 31 centers across 20 U.S. states and Canada as of March 31, 2026. Our centers, located in metropolitan and suburban areas, offer a premium patient experience and luxurious, spa-like atmosphere.
As a result, these employees also do not participate in our benefits structure, which we believe reduces the relative cost of our benefits plans to us. None of our employees is represented by a collective bargaining agreement. Additional Information 12 Table of Contents The Company was founded by Dr.
As a result, these employees also do not participate in our benefits structure, which we believe reduces the relative cost of our benefits plans to us. None of our employees is represented by a collective bargaining agreement.
Each procedure is done by a trained surgeon for customized and precise results. As for discomfort, patients typically report limited soreness the next day following the procedure.
Each procedure is done by a trained surgeon for customized and precise results. As for discomfort, patients typically report limited soreness the next day following the procedure. We believe our procedures offer dramatic results to our patients.
Based on a study completed by an independent third-party consultant contracted by the Company in July 2023, the addressable market that the Company operates in, including liposuction, body sculpting, fat transfer fillers and skin tightening procedures, was estimated to be $11 billion in 2022 and expected to grow at a 9% compound annual growth rate through 2027.
Based on a study completed by an independent third-party consultant contracted by the Company in July 2023, the addressable market that the Company operates in, including liposuction, body sculpting, fat transfer fillers and skin tightening procedures, was estimated to be $11 billion in 2022 and expected to grow at a 9% compound annual growth rate through 2027. 1 Table of Contents The increased market acceptance, availability and customer awareness of weight-loss drugs has changed the market for body fat reduction procedures.
This advanced, minimally invasive treatment combines helium gas and radiofrequency energy to create a plasma specially equipped to correct sagging skin and restore a youthful, natural appearance. AirSculpt ® Smooth delivers effective and long-lasting cellulite reduction with one single treatment. AirSculpt ® Smooth uses an advanced cellulite removal tool, which is FDA-cleared to target cellulite on the buttocks and thighs.
This advanced, minimally invasive treatment combines helium gas and radiofrequency energy to create a plasma specially equipped to correct sagging skin and restore a youthful, natural appearance. AirSculpt ® Smooth delivers effective and long-lasting cellulite reduction with one single treatment.
Our Market Opportunity We operate within the large and growing market for body fat reduction procedures. Our market includes both surgical procedures, such as liposuction and abdominoplasty procedures, as well as non-surgical procedures, such as cryolipolysis, ultrasound, laser lipolysis and other non-surgical body fat reduction procedures.
Our market includes both surgical procedures, such as liposuction and abdominoplasty procedures, as well as non-surgical procedures, such as cryolipolysis, ultrasound, laser lipolysis and other non-surgical body fat reduction procedures.
Scaled Platform and Consistent Demand Drives Capital Efficient Growth and Free Cash Flow Our operating model is highly scalable and enables capital efficient growth. For the year ended December 31, 2024, we generated approximately $180 million of revenue compared to approximately $196 million for the year ended December 31, 2023, which represents an approximately 7.9% decline.
Scaled Platform with Potential for Capital Efficient Growth and Free Cash Flow Our operating model is highly scalable and has the potential for capital efficient growth. For the year ended December 31, 2025, we generated approximately $152 million of revenue compared to approximately $180 million for the year ended December 31, 2024, which represents an approximately 15.8% decline.
Results appear almost instantly, and because AirSculpt ® Smooth is heat-free, it can be used on any skin type. Our treatment results—highlighted by a vast gallery of “before and after” photos across gender, body shape and treatment areas—are a powerful tool to build our brand through digital marketing on our website and social media accounts.
Our treatment results—highlighted by a vast gallery of “before and after” photos across gender, body shape and treatment areas—are a powerful tool to build our brand through digital marketing on our website and social media accounts.
Our surgeons are also featured on our social media platforms. AirSculpt ® allows the surgeon to provide high quality outcomes to patients while being less physically demanding on the surgeon than traditional liposuction. As AirSculpt ® is only available for use at AirSculpt centers, we protect our brand and are able to retain high quality surgeons.
Our surgeons are also featured on our social media platforms. AirSculpt ® allows the surgeon to provide high quality outcomes to patients while being less physically demanding on the surgeon than traditional liposuction.
We employ the following strategies to drive brand awareness: • Developing digital content, including a “ before and after ” photo gallery and AirSculpt ® TV: We have collected a catalog of over 250,000 “before and after” photos, showcasing our treatment outcomes.
By offering flexible payment solutions, we aim to attract a broader customer base, improve conversion rates, and strengthen customer loyalty. 4 Table of Contents We employ the following strategies to drive brand awareness: • Developing digital content, including a “ before and after ” photo gallery and AirSculpt ® TV: We have collected a catalog of over 300,000 “before and after” photos, showcasing our treatment outcomes.
Rollins in 2012 and reorganized in 2018 as part of the acquisition by our Sponsor of a majority stake in the company prior to the IPO. AirSculpt Technologies, Inc. was incorporated in Delaware on June 30, 2021 and completed an IPO on October 28, 2021. Our website address is www.airsculpt.com and our investor relations website is located at https://investors.airsculpt.com .
AirSculpt Technologies, Inc. was incorporated in Delaware on June 30, 2021 and completed an IPO on October 28, 2021. Our website address is www.airsculpt.com and our investor relations website is located at https://investors.airsculpt.com . The information posted on our website is not incorporated into this Annual Report.
These agreements also generally provide opportunities for supplemental bonuses. In addition, the Professional Associations have also agreed to reimburse us for certain expenses. See “Governmental Regulation—State Corporate Practice of Medicine and Fee-Splitting Laws.” 10 Table of Contents Continuity Agreements We have entered into Continuity Agreements at all of our Professional Associations, with the exception of New York, with Dr.
See “Governmental Regulation—State Corporate Practice of Medicine and Fee-Splitting Laws.” 9 Table of Contents Continuity Agreements We have entered into Continuity Agreements at all of our Professional Associations, with the exception of New York and California, with the Surgeon Owners, whereby they are the sole directors, officers, and owners of the Professional Associations.
AirSculpt ® is minimally invasive, providing transformative results, all delivered in one session while the patient is awake. As of December 31, 2024, our patent portfolio is comprised of two issued U.S. utility patents, one pending U.S. utility patent application, and one International (PCT) patent application, each of which we own directly.
As of December 31, 2025, our patent portfolio is comprised of two issued U.S. utility patents, one pending U.S. utility patent application, one pending U.S. provisional patent application, one pending U.S. design patent application, one pending Canada utility patent application, and one pending U.K. utility patent application, each of which we own directly.
Over the past decade, we have generated more revenue per patient, which we believe is a direct result of our successful introduction of new procedures to meet our patients’ needs. Fat transfer has been a highly successful innovation and is now a critical component of our offering, enabling the artistry of many of our most popular and highest revenue procedures.
Over the past decade, we have expanded and refined our portfolio of procedures to address evolving patient preferences and enhance clinical outcomes. Fat transfer has been a highly successful innovation and remains a critical component of our offering, enabling the artistry of many of our most sought-after procedures.
On average, our centers contain two procedure rooms with the capacity to perform up to 36 surgeries a week, in addition to additional consultation offices for prospective patients. Our accreditation as an office-based practice under the Joint Commission demonstrates our commitment to safety and quality. In 2024, we generated revenue per case of $12,849 on average.
Our centers are located primarily in metropolitan cities near retail shops that our patients frequent and popular areas. On average, our centers contain two procedure rooms with the capacity to perform up to 36 surgeries a week, in addition to additional consultation offices for prospective patients.
We have a capital efficient business that requires minimal maintenance capital expenditures and working capital to support our operations. Experienced Founder-Led Management Team to Support Growth We are led by an experienced team united by our vision to redefine body contouring and a belief in our long-term growth potential. Our founder and Executive Chairman of our board of directors, Dr.
We have a capital efficient business that requires minimal maintenance capital expenditures and working capital to support our operations.
We require 100% private pay upfront and face no reimbursement risk. Our centers generate highly attractive unit-level economics and require only a modest investment to open. Our centers typically achieve profitability within approximately three months, providing AirSculpt with a highly attractive and near-immediate return on invested capital.
Our accreditation as an office-based practice under the Joint Commission demonstrates our commitment to safety and quality. In 2025, we generated revenue per case of $12,809 on average. We require 100% private pay upfront and face no reimbursement risk. Our centers generate highly attractive unit-level economics and require only a modest investment to open.
National and International Footprint Fueled by Attractive Unit Economics We have a growing national footprint consisting of 32 centers across 20 U.S. states, Canada, and the United Kingdom as of March 14, 2025. Our centers are located primarily in metropolitan cities near retail shops that our patients frequent and popular areas.
As AirSculpt ® is only available for use at AirSculpt centers, we protect our brand and are able to retain high quality surgeons. 3 Table of Contents National and International Footprint Fueled by Attractive Unit Economics We have a national footprint consisting of 31 centers across 20 U.S. states and Canada as of March 31, 2026.
Aaron Rollins, our Lead Independent Director, Adam Feinstein, and the other management team members, we have built a culture focused on achieving the best results for our patients. For the year ended December 31, 2024, we generated $180.4 million of revenue compared to $195.9 million for the year ended December 31, 2023, which represents a decline of approximately 7.9%.
For the year ended December 31, 2025, we generated $151.8 million of revenue compared to $180.4 million for the year ended December 31, 2024, which represents a decline of approximately 15.8%. Our Market Opportunity We operate within the large and growing market for body fat reduction procedures.
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The value proposition provided by our services results in exceptional unit-level economics, which in turn helps to support predictable and recurring revenue and attractive cash flow. Additionally, we require 100% private pay upfront and, therefore, face no reimbursement risk. Under the stewardship of our founder and Executive Chairman of our board of directors, Dr.
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AirSculpt ® Smooth uses an advanced cellulite removal tool, which is cleared by the Food and Drug Administration ("FDA") to target cellulite on the buttocks and thighs. Results appear almost instantly, and because AirSculpt ® Smooth is heat-free, it can be used on any skin type.
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Given the recent decline in revenue, our focus will be stabilizing revenue growth through optimizing our marketing investment, improving our go-to-market and sales strategies, expanding consumer financing offerings and focusing on new 1 Table of Contents product innovation.
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AirSculpt ® is minimally invasive, providing transformative results, all delivered in one session while the patient is awake.
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In January 2025, the Company hired a new Chief Executive Officer, Yogi Jashnani, with over 20 years of experience in the aesthetics, retail and finance industries and significant experience in driving revenue growth through strategic initiatives. We believe that Mr.
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Our centers typically achieve profitability within approximately three months, providing AirSculpt with a highly attractive and near-immediate return on invested capital. We believe that by restoring same-store revenue growth through optimized marketing investments, stronger sales execution, expanded consumer financing options, and the introduction of new product lines, we can improve unit-level economics beyond what we achieved in 2025.
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Jashnani's industry knowledge, as well as his leadership experience, will provide value in driving initiatives forward to return to revenue growth.
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Our Long-Term Growth Strategies We intend to deliver long-term growth in revenue and profitability by executing on the following strategies: • Continue to Grow Our Brand Awareness and Attract New Patients: We believe that consumer trends towards greater acceptance of body contouring and cosmetic treatments will continue to expand the market for our services.
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We are focusing our marketing spend on techniques that have proven successful for us in the past using a returns-based approach and are also testing new areas such as online video, and other social marketing channels under the direction of our new Chief Digital Officer.
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In fiscal year 2025, we focused on new product innovation and the introduction of new services designed to expand our customer reach, leverage our existing infrastructure and surgical expertise, and generate incremental revenues. These initiatives included expanding our pilot program for our skin tightening procedure as a standalone offering.
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The Company has also hired a new Chief Sales Officer dedicated to strengthening our consultative sales model with enhanced training, improving our sales processes, and providing a greater focus on lead conversion.
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These agreements also generally provide opportunities for supplemental bonuses. In addition, the Professional Associations have also agreed to reimburse us for certain expenses.
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We believe that there is an opportunity to introduce new services, particularly in the area of skin tightening, that would allow us to expand our customer reach and generate incremental revenues. Finally, we have implemented a cost reduction program that is estimated to eliminate approximately $3 million in annual overhead costs and contracted expenses.
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Additional Information 11 Table of Contents The Company was founded in 2012 and reorganized in 2018 as part of the acquisition by our Vesey Street Capital Partners, L.L.C., our private equity sponsor ("Sponsor") of a majority stake in the company prior to the IPO.
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We believe our focus on returning to same-store revenue growth though optimizing marketing investments, enhancing sales strategies, expanding consumer financing options and adding new product lines will enhance the unit level economics over the levels we saw in 2024.
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Aaron Rollins, is a celebrity cosmetic surgeon that is recognized as a leader in body sculpting and has been featured across digital, print and TV. Dr. Rollins has been a licensed cosmetic surgeon since 2004.
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In addition, our Lead Independent Director, Adam Feinstein, who founded Vesey Street Capital Partners, L.L.C., our private equity sponsor (“Sponsor”), has 25 years of experience working with many of the leading healthcare services companies, including service as a member of public and private healthcare company board of directors.
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Our Chief Financial Officer, Dennis Dean, who has over 20 years of experience in the healthcare industry, including at Envision Healthcare and Surgery Partners, joined the team in 2021 prior to our IPO. Further, AirSculpt's founder and former Chief Executive Officer, Dr. Aaron Rollins, serves as Executive Chairman of the board of directors. Dr.
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Rollins is primarily focused on leading the Company’s overall vision and providing strategic guidance. In addition, Yogi Jashnani became Chief Executive Officer in January 2025. Mr.
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Jashnani served as the Chief Revenue Officer of Sky Zone, Inc. from November 2023 to January 2025 (and as a consultant in the same role from April 2023 to November 2023), and as Chief Commercial Officer of Ideal Image Development Corp., from December 2019 to March 2023.
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We have built a strong and experienced team across our marketing and operations functions that is highly scalable and capable of supporting future growth.
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By offering flexible payment solutions, we aim to attract a broader customer base, improve conversion rates, and strengthen customer loyalty.
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Rollins and the other Surgeon Owners, whereby they are the sole directors, officers, and owners of the Professional Associations.
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The information posted on our website is not incorporated into this Annual Report.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

121 edited+34 added−34 removed383 unchanged
Biggest changeRisks Related to Government Regulations • If we fail to comply with numerous laws and regulations relating to the operation of our centers, we could incur significant penalties or other costs or be required to make significant changes to our operations. • AirSculpt® procedures may cause or contribute to adverse medical events that we are required to report to the FDA and if we fail to do so, we could be subject to sanctions that would materially harm our business. • If laws governing the corporate practice of medicine or fee-splitting change, we may be required to restructure some of our relationships. • We may be subject to various federal and state laws pertaining to healthcare fraud and abuse, including anti-kickback, self-referral, false claims and fraud laws, and any violations by us of such laws could result in fines or other penalties. • We are subject to numerous environmental, health and safety laws and regulations, and must maintain licenses or permits, and non-compliance with these laws, regulations, licenses, or permits may expose us to significant costs or liabilities. • Certain risks are inherent in providing prescription and over the counter (“OTC”) treatments, and our insurance may not be adequate to cover any claims against us. • We are subject to rapidly changing and increasingly stringent laws, regulations, industry standards, and other obligations relating to privacy, data protection, and data security.
Biggest changeRisks Related to Intellectual Property • Our competitors could develop and commercialize procedures and products similar or identical to ours. • We may become a party to intellectual property litigation or administrative proceedings that could be costly and could interfere with our ability to market and perform our services. • If we are unable to protect the confidentiality of our other proprietary information, our business and competitive position may be harmed. • Our proprietary Airsculpt® method could become obsolete or less competitive due to the introduction of new, more effective, or less invasive competitor technologies Risks Related to Government Regulations • If we fail to comply with numerous laws and regulations relating to the operation of our centers, we could incur significant penalties or other costs or be required to make significant changes to our operations. • AirSculpt® procedures may cause or contribute to adverse medical events that we are required to report to the FDA and if we fail to do so, we could be subject to sanctions that would materially harm our business. • If laws governing the corporate practice of medicine or fee-splitting change, we may be required to restructure some of our relationships. • We may be subject to various federal and state laws pertaining to healthcare fraud and abuse, including anti-kickback, self-referral, false claims and fraud laws, and any violations by us of such laws could result in fines or other penalties. • We are subject to numerous environmental, health and safety laws and regulations, and must maintain licenses or permits, and non-compliance with these laws, regulations, licenses, or permits may expose us to significant costs or liabilities. • Certain risks are inherent in providing prescription and over the counter (“OTC”) treatments, and our insurance may not be adequate to cover any claims against us. • We are subject to rapidly changing and increasingly stringent laws, regulations, industry standards, and other obligations relating to privacy, data protection, and data security.
Certain of our directors and executive officers hold a substantial portion of our common stock, which may lead to conflicts of interest with other stockholders over corporate transactions and other corporate matters. Certain of our directors and executive officers beneficially own a substantial portion of our outstanding common stock.
Certain of our directors and executive officers hold a substantial portion of our common stock, which may lead to conflicts of interest with other stockholders over corporate transactions and other corporate matters. Certain of our directors beneficially own a substantial portion of our outstanding common stock.
These provisions in our charter documents include the following: • a classified board of directors with three-year staggered terms, which may delay the ability of stockholders to change the membership of a majority of our board of directors; • no cumulative voting in the election of directors, which limits the ability of minority stockholders to elect director candidates; • the exclusive right of our board of directors, unless the board of directors grants such right to the stockholders, to elect a director to fill a vacancy created by the expansion of the board of directors or the resignation, death or removal of a director, which prevents stockholders from being able to fill vacancies on our board of directors; • the required approval of at least 66 2∕3 % of the shares entitled to vote to remove a director for cause, and the prohibition on removal of directors without cause; • the ability of our board of directors to alter our amended and restated bylaws without obtaining stockholder approval; 43 Table of Contents • the required approval of at least 66 2∕3 % of the shares entitled to vote to adopt, amend or repeal our amended and restated bylaws or repeal the provisions of our amended and restated certificate of incorporation regarding the election and removal of directors; • a prohibition on stockholder action by written consent, which forces stockholder action to be taken at an annual or special meeting of our stockholders; • an exclusive forum provision providing that the Court of Chancery of the State of Delaware will be the exclusive forum for certain actions and proceedings; • the requirement that a special meeting of stockholders may be called only by the board of directors, which may delay the ability of our stockholders to force consideration of a proposal or to take action, including the removal of directors; • advance notice procedures that stockholders must comply with in order to nominate candidates to our board of directors or to propose matters to be acted upon at a stockholders’ meeting, which may discourage or deter a potential acquiror from conducting a solicitation of proxies to elect the acquiror’s own slate of directors or otherwise attempting to obtain control of us; and • certain restrictions on mergers and other business combinations between us and any holder of 15% or more of our outstanding common stock other than affiliates of our Sponsor.
These provisions in our charter documents include the following: • a classified board of directors with three-year staggered terms, which may delay the ability of stockholders to change the membership of a majority of our board of directors; • no cumulative voting in the election of directors, which limits the ability of minority stockholders to elect director candidates; • the exclusive right of our board of directors, unless the board of directors grants such right to the stockholders, to elect a director to fill a vacancy created by the expansion of the board of directors or the resignation, death or removal of a director, which prevents stockholders from being able to fill vacancies on our board of directors; • the required approval of at least 66 2∕3 % of the shares entitled to vote to remove a director for cause, and the prohibition on removal of directors without cause; 42 Table of Contents • the ability of our board of directors to alter our amended and restated bylaws without obtaining stockholder approval; • the required approval of at least 66 2∕3 % of the shares entitled to vote to adopt, amend or repeal our amended and restated bylaws or repeal the provisions of our amended and restated certificate of incorporation regarding the election and removal of directors; • a prohibition on stockholder action by written consent, which forces stockholder action to be taken at an annual or special meeting of our stockholders; • an exclusive forum provision providing that the Court of Chancery of the State of Delaware will be the exclusive forum for certain actions and proceedings; • the requirement that a special meeting of stockholders may be called only by the board of directors, which may delay the ability of our stockholders to force consideration of a proposal or to take action, including the removal of directors; • advance notice procedures that stockholders must comply with in order to nominate candidates to our board of directors or to propose matters to be acted upon at a stockholders’ meeting, which may discourage or deter a potential acquiror from conducting a solicitation of proxies to elect the acquiror’s own slate of directors or otherwise attempting to obtain control of us; and • certain restrictions on mergers and other business combinations between us and any holder of 15% or more of our outstanding common stock other than affiliates of our Sponsor.
Our financial condition and operating results in any given quarter can be influenced by numerous factors, many of which we are unable to predict or are outside of our control, including: • the continued market acceptance of, and the growth of the body contouring market; • our ability to maintain and attract new customers; • our development and improvement of the quality of the AirSculpt ® experience, including, improving our proprietary AirSculpt ® method and innovating new procedures; • any change in the competitive landscape of our market; • pricing pressure as a result of competition or otherwise; • delays or disruptions in our supply of handpieces; • errors in our forecasting of the demand for our services, which could lead to lower revenue or increased costs, or both; • increases in marketing, sales, and other operating expenses that we may incur to grow and expand our footprint and to remain competitive; 46 Table of Contents • the ability to maintain and open new centers; • successful expansion into international markets; • constraints on the availability of consumer financing or increased down payment requirements to finance our procedures; • system failures or breaches of security or privacy; • adverse litigation judgments, settlements, or other litigation-related costs; • changes in the legislative or regulatory environment, including with respect to healthcare regulation, privacy, consumer product safety, and advertising, or enforcement by government regulators, including fines, orders, or consent decrees; • fluctuations in currency exchange rates and changes in the proportion of our revenue and expenses denominated in foreign currencies; • changes in our effective tax rate; • changes in accounting standards, policies, guidance, interpretations, or principles; and • changes in business or macroeconomic conditions, including lower consumer confidence, recessionary conditions, increased unemployment rates, or stagnant or declining wages.
Our financial condition and operating results in any given quarter can be influenced by numerous factors, many of which we are unable to predict or are outside of our control, including: • the continued market acceptance of, and the growth of the body contouring market; • our ability to maintain and attract new customers; • our development and improvement of the quality of the AirSculpt ® experience, including, improving our proprietary AirSculpt ® method and innovating new procedures; • any change in the competitive landscape of our market; • pricing pressure as a result of competition or otherwise; • delays or disruptions in our supply of handpieces; • errors in our forecasting of the demand for our services, which could lead to lower revenue or increased costs, or both; 45 Table of Contents • increases in marketing, sales, and other operating expenses that we may incur to grow and expand our footprint and to remain competitive; • the ability to maintain and open new centers; • successful expansion into international markets; • constraints on the availability of consumer financing or increased down payment requirements to finance our procedures; • system failures or breaches of security or privacy; • adverse litigation judgments, settlements, or other litigation-related costs; • changes in the legislative or regulatory environment, including with respect to healthcare regulation, privacy, consumer product safety, and advertising, or enforcement by government regulators, including fines, orders, or consent decrees; • fluctuations in currency exchange rates and changes in the proportion of our revenue and expenses denominated in foreign currencies; • changes in our effective tax rate; • changes in accounting standards, policies, guidance, interpretations, or principles; and • changes in business or macroeconomic conditions, including lower consumer confidence, recessionary conditions, increased unemployment rates, or stagnant or declining wages.
Future guidance from the Internal Revenue Service and other tax authorities may affect us, and certain aspects of the Tax Cuts and Jobs Act or other U.S. tax laws could be repealed or modified in future legislation. In addition, it is uncertain if and to what extent various states will conform to any newly enacted federal tax legislation.
Future guidance from the Internal Revenue Service and other tax authorities may affect us, and certain aspects of the Tax Cuts and Jobs Act, the OBBBA, or other U.S. tax laws could be repealed or modified in future legislation. In addition, it is uncertain if and to what extent various states will conform to any newly enacted federal tax legislation.
We have encountered, and will continue to encounter, risks and difficulties frequently experienced by growing companies in rapidly changing industries, including market acceptance of our procedures, attracting new patients, hiring surgeons and responding to increasing competition and expenses as we expand our business.
We have encountered, and will continue to encounter, risks and difficulties frequently experienced by companies in rapidly changing industries, including market acceptance of our procedures, attracting new patients, hiring surgeons and responding to increasing competition and expenses as we expand our business.
A security breach, security incident, or privacy violation that leads to unauthorized use, disclosure, access, acquisition, loss or modification of, or that prevents access to or otherwise impacts the confidentiality, security, or integrity of, patient or employee information, including IIHI/PII that we or our third-party service providers Process, could harm our reputation, compel us to comply with breach notification laws, cause us to incur significant costs for investigation, containment, remediation, mitigation, fines, penalties, settlements, notification to individuals, regulators, media, credit bureaus, and other third parties, complimentary credit monitoring, identity theft protection, training and similar services to patients and/or employees where required by law or otherwise appropriate, for measures intended to repair or replace systems or technology and to prevent future occurrences.
A security breach, security incident, or privacy violation that leads to unauthorized use, disclosure, access, acquisition, loss or modification of, or that prevents access to or otherwise impacts the confidentiality, security, or integrity of, patient or employee information, including IIHI/PII that we or our third-party service providers Process, could harm our reputation, 31 Table of Contents compel us to comply with breach notification laws, cause us to incur significant costs for investigation, containment, remediation, mitigation, fines, penalties, settlements, notification to individuals, regulators, media, credit bureaus, and other third parties, complimentary credit monitoring, identity theft protection, training and similar services to patients and/or employees where required by law or otherwise appropriate, for measures intended to repair or replace systems or technology and to prevent future occurrences.
These laws and regulations require that our centers meet various licensing, accreditation, certification and other requirements, including, but not limited to, those relating to: • ownership and control of our centers and our arrangements with our affiliated Professional Associations; • operating policies and procedures; • qualification, training and supervision of medical and support persons; • the appropriateness and adequacy of medical care, equipment, personnel, operating policies and procedures; maintenance and preservation of medical records; • the protection and privacy of patient and other sensitive information of privacy, including, but not limited to, patient health information and credit card information; • screening, stabilization and transfer of individuals who have emergency medical conditions and provision of emergency services; • antitrust; • building codes; • workplace health and safety; • licensure, certification and accreditation; • fee-splitting and the corporate practice of medicine; • handling of medication; • confidentiality, data breach, identity theft and maintenance and protection of health-related and other personal information and medical records; • fat removal; and • environmental protection, health and safety.
These laws and regulations require that our centers meet various licensing, accreditation, certification and other requirements, including, but not limited to, those relating to: • ownership and control of our centers and our arrangements with our affiliated Professional Associations; • operating policies and procedures; • qualification, training and supervision of medical and support persons; • the appropriateness and adequacy of medical care, equipment, personnel, operating policies and procedures; maintenance and preservation of medical records; 36 Table of Contents • the protection and privacy of patient and other sensitive information of privacy, including, but not limited to, patient health information and credit card information; • screening, stabilization and transfer of individuals who have emergency medical conditions and provision of emergency services; • antitrust; • building codes; • workplace health and safety; • licensure, certification and accreditation; • fee-splitting and the corporate practice of medicine; • handling of medication; • confidentiality, data breach, identity theft and maintenance and protection of health-related and other personal information and medical records; • fat removal; and • environmental protection, health and safety.
As an “emerging growth company” under the JOBS Act, we are permitted to, and intend to, take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies,” including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act and reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements.
As an “emerging growth company” under the JOBS Act, we take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies,” including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act and reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements.
The federal False Claims Act includes a whistleblower provision that allows individuals to bring actions on behalf of the federal government and share a portion of the recovery of successful claims; • HIPAA, as amended, also created federal criminal laws that prohibit executing a scheme to defraud any healthcare benefit program or making false statements relating to healthcare matters; • similar state anti-kickback and false claims laws, some of which apply to items or services reimbursed by any third party payor, including commercial insurers or services paid out-of-pocket by consumers; and • the Federal Trade Commission Act and federal and state consumer protection, advertisement and unfair competition laws, which broadly regulate marketplace activities and activities that could potentially harm consumers.
The federal False Claims Act includes a whistleblower provision that allows individuals to bring actions on behalf of the federal government and share a portion of the recovery of successful claims; • HIPAA, as amended, also created federal criminal laws that prohibit executing a scheme to defraud any healthcare benefit program or making false statements relating to healthcare matters; 38 Table of Contents • similar state anti-kickback and false claims laws, some of which apply to items or services reimbursed by any third party payor, including commercial insurers or services paid out-of-pocket by consumers; and • the Federal Trade Commission Act and federal and state consumer protection, advertisement and unfair competition laws, which broadly regulate marketplace activities and activities that could potentially harm consumers.
Continued international operation is subject to a number of risks, including: • difficulties in staffing and managing our international operations; • increased competition as a result of more procedures receiving regulatory approval or otherwise freedom to market in international markets; • reduced or varied protection for intellectual property rights in some countries; • foreign tax laws; • fluctuations in currency exchange rates; • foreign certification and regulatory clearance or approval requirements; • difficulties in developing effective marketing campaigns in unfamiliar foreign countries; • geopolitical events (such as Russian invasion of Ukraine), social and economic instability abroad, terrorist attacks, and security concerns in general; • potentially adverse tax consequences, including the complexities of foreign value-added tax systems, tax inefficiencies related to our corporate structure, and restrictions on the repatriation of earnings; • the burdens of complying with a wide variety of foreign laws and different legal standards; and • increased financial accounting and reporting burdens and complexities.
Continued international operation is subject to a number of risks, including: • difficulties in staffing and managing our international operations; • increased competition as a result of more procedures receiving regulatory approval or otherwise freedom to market in international markets; • reduced or varied protection for intellectual property rights in some countries; • foreign tax laws; • foreign tariffs; • fluctuations in currency exchange rates; • foreign certification and regulatory clearance or approval requirements; • difficulties in developing effective marketing campaigns in unfamiliar foreign countries; • geopolitical events (such as the Russian invasion of Ukraine and the conflict in the Middle East), social and economic instability abroad, terrorist attacks, and security concerns in general; • potentially adverse tax consequences, including the complexities of foreign value-added tax systems, tax inefficiencies related to our corporate structure, and restrictions on the repatriation of earnings; • the burdens of complying with a wide variety of foreign laws and different legal standards; and • increased financial accounting and reporting burdens and complexities.
Our reliance on a single supplier of handpieces subjects us to a number of risks that could harm our business, including: • interruption of supply resulting from modifications to or discontinuation of Euromi’s operations; • delays in product shipments resulting from uncorrected defects, reliability issues, or Euromi’s variation in a component; • a lack of long-term supply agreements; • inability to obtain adequate supply in a timely manner or to obtain adequate supply on commercially reasonable terms; • difficulty and cost associated with locating and qualifying alternative suppliers for our handpieces in a timely manner; • production delays related to the evaluation and testing of handpieces from alternative suppliers and corresponding regulatory qualifications; and 22 Table of Contents • damage to our brand reputation caused by defective handpieces.
Our reliance on a single supplier of handpieces subjects us to a number of risks that could harm our business, including: • interruption of supply resulting from modifications to or discontinuation of Euromi’s operations; • delays in product shipments resulting from uncorrected defects, reliability issues, or Euromi’s variation in a component; • a lack of long-term supply agreements; • inability to obtain adequate supply in a timely manner or to obtain adequate supply on commercially reasonable terms; • difficulty and cost associated with locating and qualifying alternative suppliers for our handpieces in a timely manner; • production delays related to the evaluation and testing of handpieces from alternative suppliers and corresponding regulatory qualifications; and • damage to our brand reputation caused by defective handpieces.
Such occurrences could have an adverse effect on our business, financial condition or results of operations. Risks Related to Ownership of Our Common Stock We are an “emerging growth company,” as defined in the Securities Act, and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our common stock less attractive to investors.
Such occurrences could have an adverse effect on our business, financial condition or results of operations. Risks Related to Ownership of Our Common Stock We are an "emerging growth company," as defined in the Securities Act, and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our common stock less attractive to investors.
As of December 31, 2024, we had borrowings under our Term Loan and Revolving Credit Facility with variable rate debt that was indexed to the Secured Overnight Financing Rate (“SOFR”). All outstanding loans bear interest based on either a base rate or SOFR plus an applicable per annum margin.
As of December 31, 2025, we had borrowings under our Term Loan and Revolving Credit Facility with variable rate debt that was indexed to the Secured Overnight Financing Rate (“SOFR”). All outstanding loans bear interest based on either a base rate or SOFR plus an applicable per annum margin.
This control could delay, deter, or prevent a third party from acquiring or merging with us, which could adversely affect the market price of our common stock. Provisions in our charter documents and Delaware law may deter takeover efforts that could be beneficial to stockholder value.
This influence could delay, deter, or prevent a third party from acquiring or merging with us, which could adversely affect the market price of our common stock. Provisions in our charter documents and Delaware law may deter takeover efforts that could be beneficial to stockholder value.
Our Term Loan and Revolving Credit Facility, including the recent Third Amendment, contain various covenants that limit, among other things, our ability and the ability of our restricted subsidiaries to: • incur additional indebtedness; • make certain distributions, investments and other restricted payments; • dispose of our assets; 26 Table of Contents • grant liens on our assets; • engage in transactions with affiliates; • merge, consolidate or transfer substantially all of our assets; and • make payments to us (in the case of our restricted subsidiaries).
Our Term Loan and Revolving Credit Facility, including the recent Third Amendment, contain various covenants that limit, among other things, our ability and the ability of our restricted subsidiaries to: • incur additional indebtedness; • make certain distributions, investments and other restricted payments; • dispose of our assets; • grant liens on our assets; • engage in transactions with affiliates; • merge, consolidate or transfer substantially all of our assets; and • make payments to us (in the case of our restricted subsidiaries).
Additionally, we may be obligated to indemnify our business partners in connection with intellectual property litigation, which could further exhaust our resources. Even if we believe a third party’s intellectual property claims are without merit, there is no assurance that a court would find in our favor, including on questions of infringement, validity, enforceability or priority of patents.
Additionally, we may be obligated to indemnify our business partners in connection with intellectual property litigation, which could further exhaust our resources. 33 Table of Contents Even if we believe a third party’s intellectual property claims are without merit, there is no assurance that a court would find in our favor, including on questions of infringement, validity, enforceability or priority of patents.
We have entered into, and may in the future enter into, agreements with our Sponsor which constitute related-party transactions as defined under Item 404 of Regulation S-K, as disclosed in further detail in this Annual Report on Form 10-K under the caption “Certain Relationships and Related Transactions, and Director Independence.” As of the date of this Annual Report on Form 10-K, affiliates of our Sponsor beneficially own 50.1% of our common stock.
We have entered into, and may in the future enter into, agreements with our Sponsor which constitute related-party transactions as defined under Item 404 of Regulation S-K, as disclosed in further detail in this Annual Report on Form 10-K under the caption “Certain Relationships and Related Transactions, and Director Independence.” As of the date of this Annual Report on Form 10-K, affiliates of our Sponsor beneficially own 47% of our common stock.
Some of our subsidiaries may become subject to agreements that restrict the sale of assets and significantly restrict or prohibit the payment of dividends or the making of distributions, loans or other payments to stockholders, partners or members. Our variable rate debt exposes us to risks associated with rising interest rates, which could adversely affect our cash flows.
Some of our subsidiaries may become subject to agreements that restrict the sale of assets and significantly restrict or prohibit the payment of dividends or the making of distributions, loans or other payments to stockholders, partners or members. 27 Table of Contents Our variable rate debt exposes us to risks associated with rising interest rates, which could adversely affect our cash flows.
Because patent applications can take years to issue and are often afforded confidentiality for some period of time, there is a risk we may develop one or more procedures or other technologies without knowledge of a pending patent application, which if such patent application 33 Table of Contents issued into a patent would result in our procedures or technologies infringing such patent.
Because patent applications can take years to issue and are often afforded confidentiality for some period of time, there is a risk we may develop one or more procedures or other technologies without knowledge of a pending patent application, which if such patent application issued into a patent would result in our procedures or technologies infringing such patent.
Moreover, while we maintain cyber insurance that may help provide coverage for these types of incidents, we cannot assure you that our insurance will be adequate to cover all costs and liabilities related to these incidents. In addition, such insurance may not be available to us in the future on economically reasonable terms, or at all.
Moreover, while we maintain cyber insurance that may help provide coverage for these types of incidents, we cannot 30 Table of Contents assure you that our insurance will be adequate to cover all costs and liabilities related to these incidents. In addition, such insurance may not be available to us in the future on economically reasonable terms, or at all.
In any such lawsuit or other proceedings, a court or other administrative body may decide that a patent of 34 Table of Contents ours is invalid or unenforceable, in whole or in part, construe the patent’s claims narrowly or refuse to stop the other party from using the technology at issue on the grounds that our patents do not cover the technology in question.
In any such lawsuit or other proceedings, a court or other administrative body may decide that a patent of ours is invalid or unenforceable, in whole or in part, construe the patent’s claims narrowly or refuse to stop the other party from using the technology at issue on the grounds that our patents do not cover the technology in question.
Insurance coverage may not continue to be available at a cost allowing us to maintain adequate levels of insurance. If one or more successful claims against us, our affiliated 23 Table of Contents Professional Associations or surgeons were not covered by or exceeded the coverage of our insurance, our financial condition and results of operations could be adversely affected.
Insurance coverage may not continue to be available at a cost allowing us to maintain adequate levels of insurance. If one or more successful claims against us, our affiliated Professional Associations or surgeons were not covered by or exceeded the coverage of our insurance, our financial condition and results of operations could be adversely affected.
Outcomes from these examinations and audits could have an adverse effect on our financial condition and results of operations. 28 Table of Contents If there is a change in accounting standards by the Financial Accounting Standards Board or the interpretation thereof affecting consolidation of entities, it could have a material adverse effect on our consolidation of total revenue derived from the Professional Associations.
Outcomes from these examinations and audits could have an adverse effect on our financial condition and results of operations. If there is a change in accounting standards by the Financial Accounting Standards Board or the interpretation thereof affecting consolidation of entities, it could have a material adverse effect on our consolidation of total revenue derived from the Professional Associations.
We provide comprehensive, administrative and non-clinical Management Services to our affiliated Professional Associations in exchange for a management fee. Regulatory authorities, state boards of medicine, state attorneys general and other parties 38 Table of Contents may assess or determine that our relationships with our affiliated Professional Associations and surgeons violate state CPOM and/or fee-splitting prohibitions.
We provide comprehensive, administrative and non-clinical Management Services to our affiliated Professional Associations in exchange for a management fee. Regulatory authorities, state boards of medicine, state attorneys general and other parties may assess or determine that our relationships with our affiliated Professional Associations and surgeons violate state CPOM and/or fee-splitting prohibitions.
Any of the foregoing consequences could seriously harm our business and our financial results. Further, we are subject to the Payment Card Industry Data Security Standard (“PCI DSS”), a security standard applicable to companies that collect, store or transmit certain data regarding credit and debit cards, holders and transactions.
Any of the foregoing consequences could seriously harm our business and our financial results. 40 Table of Contents Further, we are subject to the Payment Card Industry Data Security Standard (“PCI DSS”), a security standard applicable to companies that collect, store or transmit certain data regarding credit and debit cards, holders and transactions.
As of December 31, 2024, we remained an emerging growth company, and as such, our independent registered public accounting firm is not required to certify the effectiveness of our internal controls.
As of December 31, 2025, we remained an emerging growth company, and as such, our independent registered public accounting firm is not required to certify the effectiveness of our internal controls.
Changes in how web and mail services block, organize and prioritize email may reduce the number of subscribers who receive or open our 20 Table of Contents emails. For example, Google’s Gmail service has a feature that organizes incoming emails into categories (for example, primary, social and promotions).
Changes in how web and mail services block, organize and prioritize email may reduce the number of subscribers who receive or open our emails. For example, Google’s Gmail service has a feature that organizes incoming emails into categories (for example, primary, social and promotions).
While we have confidence in these individuals, organizations and systems, agreements or security measures may be breached and detecting the disclosure or misappropriation of confidential information and enforcing a claim that a party illegally disclosed or misappropriated confidential information is difficult, expensive and time-consuming, and the outcome is unpredictable.
While we 35 Table of Contents have confidence in these individuals, organizations and systems, agreements or security measures may be breached and detecting the disclosure or misappropriation of confidential information and enforcing a claim that a party illegally disclosed or misappropriated confidential information is difficult, expensive and time-consuming, and the outcome is unpredictable.
A number of states, including states in which we operate, such as California, Massachusetts, and New York have passed recent legislation that are materially increasing the scrutiny of investors investing in for-profit health care providers, which could ultimately impact our existing structure.
A number of states, including states in which we operate, such as California, Massachusetts, and New York 39 Table of Contents have passed recent legislation that are materially increasing the scrutiny of investors investing in for-profit health care providers, which could ultimately impact our existing structure.
This concentration of ownership may not be in the best interests of our other stockholders. These stockholders, acting together, would be able to influence significantly all matters requiring stockholder approval, including the election of directors and significant corporate transactions such as mergers or other business combinations.
This concentration of ownership may not be in the best interests of our other stockholders. These stockholders, acting together, would be able to have significant influence over all matters requiring stockholder approval, including the election of directors and significant corporate transactions such as mergers or other business combinations.
The theft or unauthorized use or publication of our trade secrets and other confidential proprietary information could reduce the differentiation of our 35 Table of Contents procedures and harm our business, the value of our investment in development could be reduced and third parties may make claims against us related to losses of their confidential or proprietary information.
The theft or unauthorized use or publication of our trade secrets and other confidential proprietary information could reduce the differentiation of our procedures and harm our business, the value of our investment in development could be reduced and third parties may make claims against us related to losses of their confidential or proprietary information.
In the event of any other adverse regulatory, economic or other developments in any of the states and jurisdictions in which we have a higher concentration of centers there could be unanticipated adverse impacts on 24 Table of Contents our business in those states and jurisdictions, which could have a material adverse effect on our business, prospects, results of operations and financial condition.
In the event of any other adverse regulatory, economic or other developments in any of the states and jurisdictions in which we have a higher concentration of centers there could be unanticipated adverse impacts on our business in those states and jurisdictions, which could have a material adverse effect on our business, prospects, results of operations and financial condition.
Because our senior management is instrumental to our future success, the loss of key management personnel, without adequate replacements, or our inability to attract, retain and motivate sufficient numbers of qualified management personnel could have a material adverse effect on our financial condition and results of operations.
Because our senior 24 Table of Contents management is instrumental to our future success, the loss of key management personnel, without adequate replacements, or our inability to attract, retain and motivate sufficient numbers of qualified management personnel could have a material adverse effect on our financial condition and results of operations.
Adverse publicity may include publicity about the cosmetic treatment industry generally, the efficacy, safety and quality of body fat reduction procedures in general, and liability claims or other litigation, regardless of whether such litigation involves us or the business practices or services of our competitors.
Adverse publicity may include 16 Table of Contents publicity about the cosmetic treatment industry generally, the efficacy, safety and quality of body fat reduction procedures in general, and liability claims or other litigation, regardless of whether such litigation involves us or the business practices or services of our competitors.
If there is not sufficient patient demand for AirSculpt ® procedures, our financial results and future prospects will be harmed. 17 Table of Contents The AirSculpt ® procedure is an elective procedure, the cost of which must be borne by the patient, and is not reimbursable through government or private health insurance.
If there is not sufficient patient demand for AirSculpt ® procedures, our financial results and future prospects will be harmed. The AirSculpt ® procedure is an elective procedure, the cost of which must be borne by the patient, and is not reimbursable through government or private health insurance.
As a result, we face even greater competition in these markets than in the United States. Further, our patent protection of AirSculpt® is limited to the United States, and therefore we may face increased competition from competitors using procedures similar to the AirSculpt® procedure in other countries.
As a result, we face even greater competition in these markets than in the 18 Table of Contents United States. Further, our patent protection of AirSculpt® is limited to the United States, and therefore we may face increased competition from competitors using procedures similar to the AirSculpt® procedure in other countries.
For example, the California Confidentiality of Medical 40 Table of Contents Information Act (CMIA) regulates the disclosure of medical information, and applies to the IIHI we Process in the ordinary course of our Business. Violations of the CMIA can result in personal liability to the patient, the imposition of administrative fines and civil penalties, and even criminal liability.
For example, the California Confidentiality of Medical Information Act (CMIA) regulates the disclosure of medical information, and applies to the IIHI we Process in the ordinary course of our Business. Violations of the CMIA can result in personal liability to the patient, the imposition of administrative fines and civil penalties, and even criminal liability.
The effect of this structure is that we depend on the earnings of our 27 Table of Contents subsidiaries, and the distribution or payment to us of a portion of these earnings to meet our obligations, including those under our Term Loan and Revolving Credit Facility and any of our other debt obligations.
The effect of this structure is that we depend on the earnings of our subsidiaries, and the distribution or payment to us of a portion of these earnings to meet our obligations, including those under our Term Loan and Revolving Credit Facility and any of our other debt obligations.
Despite our 31 Table of Contents implementation of security measures, cyber-attacks are becoming more sophisticated and frequent, and we or our third-party service providers may be unable to anticipate these techniques or to implement adequate protective measures against them or to prevent additional attacks.
Despite our implementation of security measures, cyber-attacks are becoming more sophisticated and frequent, and we or our third-party service providers may be unable to anticipate these techniques or to implement adequate protective measures against them or to prevent additional attacks.
If we cannot identify, hire, develop and retain adequate staff for our centers through our affiliated Professional Associations, we will not be able to open new centers on a timely basis or adequately staff existing centers. Our personnel or others may engage in misconduct or other improper activities, including noncompliance with our policies and procedures.
If we cannot identify, hire, develop and retain adequate staff for our centers through our affiliated Professional Associations, we will not be able to open new centers on a timely basis or adequately staff existing centers. 21 Table of Contents Our personnel or others may engage in misconduct or other improper activities, including noncompliance with our policies and procedures.
These risks and uncertainties include, but are not limited to, the following: Risks Related to Our Business • Our operating results could be adversely affected if we are unable to successfully implement certain cost savings initiatives and revenue growth strategies. • Macroeconomic trends including inflation and rising interest rates may adversely affect our financial condition and results of operations. • We have a limited operating history and our past results may not be indicative of our future performance. • Our success depends on our ability to maintain the value and reputation of the AirSculpt® brand. • We have grown rapidly in recent years and have limited operating experience at our current scale of operations. • Our financial results will be harmed if there is not sufficient patient demand for AirSculpt® procedures. • Our success depends largely upon patient satisfaction with the effectiveness of the AirSculpt® procedure. • We may fail to open and operate new centers in a timely and cost-effective manner. • We may not be able to successfully continue to expand in markets outside of North America. • If our competitors are able to develop and market solutions that are safer, more effective, easier to use or more readily adopted by patients and healthcare providers, our commercial opportunities may be reduced or eliminated. • Our business, financial condition and results of operations could be adversely affected by disruptions in the global economy resulting from the ongoing military conflict between Russia and Ukraine. • Use of social media may materially and adversely affect our reputation or subject us to fines or other penalties. • Our business relies heavily on email and other messaging services, and any restrictions on the sending of emails or messages or an inability to timely deliver such communications could materially adversely affect our net revenue and business. • Changes in laws and regulations related to the internet, perceptions toward the use of social media and changes in internet infrastructure itself may diminish our ability to drive new customer acquisition. • Regulations related to healthcare may hamper our availability to provide virtual consultations. • We face competition for surgeons and other workers that provide our medspa and cosmetic services. • We outsource the manufacturing of key elements of the tools we use for AirSculpt® procedures to a single third-party manufacturer, Euromi, who is dependent upon third-party suppliers. • In some jurisdictions, we are precluded or limited in our ability to enter into non-compete agreements with our surgeons. • Our centers and our affiliated Professional Associations may become subject to medical liability claims. • Our revenue could decline due to changes in credit markets and decisions made by credit providers. • We may be adversely affected if we lose any member of our senior management. • The interests of our Sponsor may conflict with the interests of the Company and its other stockholders. • Our leverage could adversely affect our ability to raise additional capital to fund our operations, limit our ability to react to changes in the economy or our industry and expose us to interest rate risk. • Restrictive covenants in our debt instruments may adversely affect us. • Any failure to meet our debt service obligations could have a material adverse effect on our business, prospects, results of operations and financial condition. • We are a holding company with no operations of our own. • Our variable rate debt exposes us to risks associated with rising interest rates, which could adversely affect our cash flows. • If there is a change in accounting standards by the Financial Accounting Standards Board or the interpretation thereof affecting consolidation of entities, it could have a material adverse effect on our consolidation of total revenue derived from the Professional Associations. • Our management team has limited experience managing a public company. 14 Table of Contents • Our centers may be adversely impacted by weather and other factors beyond our control, and disruptions in our disaster recovery systems or management continuity planning could limit our ability to operate our business effectively. • Use and storage of paper medical records increases risk of loss, destruction and could increase human error with respect to documentation and patient care. • Our internal computer systems, or those of any of our manufacturers, other contractors, consultants, or collaborators, may fail or suffer security or data privacy breaches or other unauthorized or improper access to, use of, or destruction of our proprietary or confidential data, employee data, or personal data. • Security breaches, loss of data, and other disruptions could compromise sensitive information related to our business or our patients, or prevent us from accessing critical information or systems and expose us to liability, and could adversely affect our business and our reputation.
These risks and uncertainties include, but are not limited to, the following: Risks Related to Our Business • Our operating results could be adversely affected if we are unable to successfully implement certain cost savings initiatives and revenue growth strategies. • Macroeconomic trends including inflation and rising interest rates may adversely affect our financial condition and results of operations. • We have a limited operating history and our past results may not be indicative of our future performance. • Our success depends on our ability to maintain the value and reputation of the AirSculpt® brand. • We have grown rapidly in recent years and have limited operating experience at our current scale of operations. • Our financial results will be harmed if there is not sufficient patient demand for AirSculpt® procedures. • Our success depends largely upon patient satisfaction with the effectiveness of the AirSculpt® procedure. • We may fail to open and operate new centers in a timely and cost-effective manner. • We may not be able to successfully expand in markets outside of North America. • If our competitors are able to develop and market solutions that are safer, more effective, easier to use or more readily adopted by patients and healthcare providers, our commercial opportunities may be reduced or eliminated. • Our business, financial condition and results of operations could be adversely affected by disruptions in the global economy resulting from several instances of geopolitical instability, including the ongoing military conflict between Russia and Ukraine, the ongoing conflict in the Middle East, and tensions between the U.S. and China. • Disruptions at the FDA, the SEC and other government agencies caused by funding shortages or government shutdowns could negatively impact our business operations and regulatory interactions. • Use of social media may materially and adversely affect our reputation or subject us to fines or other penalties. • Our business relies heavily on email and other messaging services, and any restrictions on the sending of emails or messages or an inability to timely deliver such communications could materially adversely affect our net revenue and business. • Changes in laws and regulations related to the internet, perceptions toward the use of social media and changes in internet infrastructure itself may diminish our ability to drive new customer acquisition. • Regulations related to healthcare may hamper our availability to provide virtual consultations. • We face competition for surgeons and other workers that provide our medspa and cosmetic services. • Changes in tariffs and other governmental trade policies could negatively affect our business and results of operations. • We outsource the manufacturing of key elements of the tools we use for AirSculpt® procedures to a single third-party manufacturer, Euromi, who is dependent upon third-party suppliers. • In some jurisdictions, we are precluded or limited in our ability to enter into non-compete agreements with our surgeons. • Our centers and our affiliated Professional Associations may become subject to medical liability claims. • Our revenue could decline due to changes in credit markets and decisions made by credit providers. • We may be adversely affected if we lose any member of our senior management. • The interests of our Sponsor may conflict with the interests of the Company and its other stockholders. • Our leverage could adversely affect our ability to raise additional capital to fund our operations, limit our ability to react to changes in the economy or our industry and expose us to interest rate risk. • Restrictive covenants in our debt instruments may adversely affect us. • Any failure to meet our debt service obligations could have a material adverse effect on our business, prospects, results of operations and financial condition. • We are a holding company with no operations of our own. • Our variable rate debt exposes us to risks associated with rising interest rates, which could adversely affect our cash flows. 13 Table of Contents • If there is a change in accounting standards by the Financial Accounting Standards Board or the interpretation thereof affecting consolidation of entities, it could have a material adverse effect on our consolidation of total revenue derived from the Professional Associations. • Our management team has limited experience managing a public company. • Our centers may be adversely impacted by weather and other factors beyond our control, and disruptions in our disaster recovery systems or management continuity planning could limit our ability to operate our business effectively. • Use and storage of paper medical records increases risk of loss, destruction and could increase human error with respect to documentation and patient care. • Our internal computer systems, or those of any of our manufacturers, other contractors, consultants, or collaborators, may fail or suffer security or data privacy breaches or other unauthorized or improper access to, use of, or destruction of our proprietary or confidential data, employee data, or personal data. • Security breaches, loss of data, and other disruptions could compromise sensitive information related to our business or our patients, or prevent us from accessing critical information or systems and expose us to liability, and could adversely affect our business and our reputation.
In response to the decline in revenue we experienced during the 2024 fiscal year, we are in the process of implementing certain cost-savings initiatives and revenue growth strategies, which are discussed in further detail under the captions “Our Company,” “National and International Footprint Fueled by Attractive Unit Economics,” “Our Growth Strategies,” and “Our Marketing and Sales Efforts and Third-Party Financing” included in Item 1 of this Annual Report on Form 10-K.
In response to the declines in revenue we experienced during the 2024 and 2025 fiscal years, we are in the process of implementing certain cost-savings initiatives and revenue growth strategies, which are discussed in further detail under the captions “Our Company,” “National and International Footprint Fueled by Attractive Unit Economics,” “Our Growth Strategies,” and “Our Marketing and Sales Efforts and Third-Party Financing” included in Item 1 of this Annual Report on Form 10-K.
Future growth could strain our existing resources and we could experience ongoing operating difficulties in managing our 16 Table of Contents business across numerous jurisdictions, including difficulties in hiring, training, and managing surgeons and other staff in our centers through the Professional Associations. Failure to scale and preserve our high-performance, client-focused culture could delay or prevent future success.
Future growth could strain our existing resources and we could experience ongoing operating difficulties in managing our business across numerous jurisdictions, including difficulties in hiring, training, and managing surgeons and other staff in our centers through the Professional Associations. Failure to scale and preserve our high-performance, client-focused culture could delay or prevent future success.
We rely on a skilled, licensed labor force to provide our medspa and cosmetic services, and the supply of this labor force is finite. If we cannot hire adequate staff for our clinics, we will not be able to operate. As of December 31, 2024, we employed approximately 389 full-time employees and approximately 33 part-time employees.
We rely on a skilled, licensed labor force to provide our medspa and cosmetic services, and the supply of this labor force is finite. If we cannot hire adequate staff for our clinics, we will not be able to operate. As of December 31, 2025, we employed approximately 330 full-time employees and approximately 33 part-time employees.
Upon the occurrence of an event of default under our Term Loan and Revolving Credit Facility, the lenders could elect to declare all amounts outstanding under our Term Loan and Revolving Credit Facility to be immediately due and payable and terminate all commitments to extend further credit.
Upon the occurrence of an event of default under our Term Loan and 26 Table of Contents Revolving Credit Facility, the lenders could elect to declare all amounts outstanding under our Term Loan and Revolving Credit Facility to be immediately due and payable and terminate all commitments to extend further credit.
Because of the market opportunity and the high growth potential of the market for weight loss and obesity solutions, existing and potential competitors have historically dedicated, and will 19 Table of Contents continue to dedicate, significant resources to aggressively develop and commercialize their products.
Because of the market opportunity and the high growth potential of the market for weight loss and obesity solutions, existing and potential competitors have historically dedicated, and will continue to dedicate, significant resources to aggressively develop and commercialize their products.
Similarly, enhanced scrutiny may lead to an increase in regulation of social media, which could limit our ability to use social media to drive our brand awareness and increase consumer acceptance for our procedures.
Similarly, enhanced scrutiny may lead to 20 Table of Contents an increase in regulation of social media, which could limit our ability to use social media to drive our brand awareness and increase consumer acceptance for our procedures.
We face competition for surgeons. 21 Table of Contents The number of surgeons available to work through our affiliated Professional Associations at our centers is finite, and we face intense competition from other cosmetic treatment centers in recruiting surgeons to work in our centers. In addition, there may be other companies that may decide to enter our business.
The number of surgeons available to work through our affiliated Professional Associations at our centers is finite, and we face intense competition from other cosmetic treatment centers in recruiting surgeons to work in our centers. In addition, there may be other companies that may decide to enter our business.
This could also make it more difficult for us to attract and retain qualified people to serve on our board of directors, our board committees, or as executive officers.
This could also make it 44 Table of Contents more difficult for us to attract and retain qualified people to serve on our board of directors, our board committees, or as executive officers.
The Limited Guarantee is callable on June 15, 2025 (or upon the earlier occurrence of certain defaults described therein) if the Company has not prepaid the Term Loan (excluding regularly scheduled amortization) by $10.0 million as of such date.
The Limited Guarantee was callable on June 15, 2025 (or upon the earlier occurrence of certain defaults described therein) if the Company had not prepaid the Term Loan (excluding regularly scheduled amortization) by $10.0 million as of such date.
Therefore, we cannot be certain that we were the first to 32 Table of Contents make the inventions claimed in our patents or pending patent applications or that we were the first to file for patent protection of such inventions.
Therefore, we cannot be certain that we were the first to make the inventions claimed in our patents or pending patent applications or that we were the first to file for patent protection of such inventions.
Such litigation or proceedings could substantially increase our operating losses and reduce the resources available for development activities or any future sales, marketing or distribution activities. We may not have sufficient financial or other resources to conduct such litigation or proceedings adequately.
Such litigation or proceedings could substantially increase our operating losses and reduce the resources available 34 Table of Contents for development activities or any future sales, marketing or distribution activities. We may not have sufficient financial or other resources to conduct such litigation or proceedings adequately.
As of the date of this Annual Report on Form 10-K, we operate through our arrangements with our affiliated Professional Associations thirty-two centers in Arizona, California, Colorado, Florida, Georgia, Illinois, Kansas, Massachusetts, Michigan, Minnesota, Nevada, New York, North Carolina, Ohio, Pennsylvania, Tennessee, Texas, Utah, Washington, and Virginia as well as Toronto, Canada and London, United Kingdom.
As of the date of this Annual Report on Form 10-K, we operate through our arrangements with our affiliated Professional Associations centers in Arizona, California, Colorado, Florida, Georgia, Illinois, Kansas, Massachusetts, Michigan, Minnesota, Nevada, New York, North Carolina, Ohio, Pennsylvania, Tennessee, Texas, Utah, Washington, Virginia and Toronto, Canada.
The price of our common stock could be subject to wide fluctuations in response to a number of factors, including those described elsewhere in this Annual Report on Form 10-K and others such as: • variations in our operating performance and the performance of our competitors; • actual or anticipated fluctuations in our quarterly or annual operating results; • publication of research reports by securities analysts about us or our competitors or our industry; • announcements by us, our competitors or our vendors of significant contracts, acquisitions, joint marketing relationships, joint ventures or capital commitments; • our failure or the failure of our competitors to meet analysts’ projections or guidance that we or our competitors may give to the market; • additions and departures of key personnel; • strategic decisions by us or our competitors, such as acquisitions, divestitures, spin-offs, joint ventures, strategic investments or changes in business strategy; • the passage of legislation or other regulatory developments affecting us or our industry; • speculation in the press or investment community; • changes in accounting principles; • geopolitical conditions such as acts of terrorism, military or armed conflicts, such as the Russian invasion of Ukraine, or global pandemics; • natural disasters, including earthquakes, floods and wildfires (such as the 2025 Los Angeles wildfires), and other calamities; and • changes in general market and economic conditions. 42 Table of Contents In the past, securities class action litigation has often been initiated against companies following periods of volatility in their stock price.
The price of our common stock could be subject to wide fluctuations in response to a number of factors, including those described elsewhere in this Annual Report on Form 10-K and others such as: • variations in our operating performance and the performance of our competitors; • actual or anticipated fluctuations in our quarterly or annual operating results; • publication of research reports by securities analysts about us or our competitors or our industry; • announcements by us, our competitors or our vendors of significant contracts, acquisitions, joint marketing relationships, joint ventures or capital commitments; • our failure or the failure of our competitors to meet analysts’ projections or guidance that we or our competitors may give to the market; • additions and departures of key personnel; • strategic decisions by us or our competitors, such as acquisitions, divestitures, spin-offs, joint ventures, strategic investments or changes in business strategy; • the passage of legislation or other regulatory developments affecting us or our industry; • speculation in the press or investment community; • changes in accounting principles; 41 Table of Contents • geopolitical conditions such as acts of terrorism, military or armed conflicts, such as the Russian invasion of Ukraine, or global pandemics; • natural disasters, including earthquakes, floods and wildfires (such as the 2025 Los Angeles wildfires), and other calamities; and • changes in general market and economic conditions.
If we are required to adapt our business model, we may be limited to only in-person services, which may have a material adverse effect on our business, financial condition and results of operations.
If we are required to adapt our business model, we may be limited to only in-person services, which may have a material adverse effect on our business, financial condition and results of operations. We face competition for surgeons.
Euromi manufactures the handpiece our surgeons use for AirSculpt ® procedures. If the operations of Euromi are interrupted or if they are unable to meet our delivery requirements due to capacity limitations or other constraints, we may be limited in our ability to perform procedures for customers which could harm our reputation and results of operations.
If the operations of Euromi are interrupted or if they are unable to meet our delivery requirements due to capacity limitations or other constraints, we may be limited in our ability to perform procedures for customers which could harm our reputation and results of operations.
We rely on Vesey Street Capital Partners, L.L.C., our private equity sponsor and the interests of our Sponsor may conflict with the interests of the Company and its other stockholders. We have in recent years depended on our relationship with our Sponsor to help guide our business plan. Our Sponsor has significant expertise in financial matters.
We rely on Vesey Street Capital Partners, L.L.C., our private equity sponsor and the interests of our Sponsor may conflict with the interests of the Company and its other stockholders. We have in recent years depended on our relationship with our Sponsor to help guide our business plan.
Although the Term Loan and Revolving Credit Facility, including the recent Third Amendment, contains restrictions on the incurrence of additional indebtedness, these restrictions are subject to a number of significant qualifications and exceptions, and the indebtedness incurred in compliance with these restrictions could be substantial. In addition, as of December 31, 2024 we had no availability under our Revolver.
Although the Term Loan and Revolving Credit Facility, including the recent Third Amendment, contains restrictions on the incurrence of additional indebtedness, these restrictions are subject to a number of significant qualifications and exceptions, and the indebtedness incurred in compliance with these restrictions could be substantial. In addition, as of December 31, 2025 we had $5.0 million under our Revolver.
Our business, profitability and growth prospects could suffer if we face negative publicity or we pay damages or defense costs in connection with a claim that is outside the scope or limits of coverage of any applicable insurance coverage, including claims related to adverse patient events, contractual disputes, professional and general liability, and directors’ and officers’ duties.
Our business, profitability and growth prospects could suffer if we face negative publicity or we pay damages or defense costs in connection with a claim that is outside the scope or limits of coverage of any applicable insurance coverage, including claims related to adverse patient events, contractual disputes, professional and general liability, and directors’ and officers’ duties. 23 Table of Contents In addition, if our costs of insurance and claims increase, then our earnings could decline.
We use third-party social media platforms as marketing tools. For example, we maintain Facebook, Instagram and YouTube accounts and we offer consumers the opportunity to comment on our social media platforms. Negative commentary or false statements may be posted on our social media platforms, which could be adverse to our reputation or business.
For example, we maintain Facebook, Instagram and YouTube accounts and we offer consumers the opportunity to comment on our social media platforms. Negative commentary or false statements may be posted on our social media platforms, which could be adverse to our reputation or business.
Such shares are freely transferable, except for any shares held by our “affiliates,” as that term is defined in Rule 144 under the Securities Act of 1933, as amended (the “Securities Act”). As of March 13, 2025, approximately 77.0% of our outstanding common stock is held by investment funds affiliated with our Sponsor and members of our management and employees.
Such shares are freely transferable, except for any shares held by our “affiliates,” as that term is defined in Rule 144 under the Securities Act of 1933, as amended (the “Securities Act”). As of March 30, 2026, approximately 44.9% of our outstanding common stock is held by investment funds affiliated with our Sponsor and members of our management and employees.
Our ability to successfully operate new centers depends on many factors, including, among others, our ability to: • recruit qualified surgeons through our affiliated Professional Associations for our new centers; • address regulatory, competitive, and marketing, and other challenges encountered in connection with expansion into new markets; • hire, train and retain surgeons and other personnel through our affiliated Professional Associations; • maintain adequate information system and other operational system capabilities; • successfully integrate new centers into our existing management structure with affiliated Professional Associations and operations, including information system integration; • source sufficient levels of medical supplies at acceptable costs; • obtain and maintain necessary permits and licenses through our affiliated Professional Associations; • generate sufficient levels of cash or obtain financing on acceptable terms to support our expansion; • achieve and maintain brand awareness in new markets; and • identify and satisfy the needs and preferences of our patients.
Our ability to successfully operate new centers depends on many factors, including, among others, our ability to: • recruit qualified surgeons through our affiliated Professional Associations for our new centers; • address regulatory, competitive, and marketing, and other challenges encountered in connection with expansion into new markets; • hire, train and retain surgeons and other personnel through our affiliated Professional Associations; • maintain adequate information system and other operational system capabilities; • successfully integrate new centers into our existing management structure with affiliated Professional Associations and operations, including information system integration; • source sufficient levels of medical supplies at acceptable costs; • obtain and maintain necessary permits and licenses through our affiliated Professional Associations; • generate sufficient levels of cash or obtain financing on acceptable terms to support our expansion; • achieve and maintain brand awareness in new markets; and • identify and satisfy the needs and preferences of our patients. 17 Table of Contents Our failure to effectively address challenges such as these could adversely affect our ability to successfully operate new centers in a cost-effective manner.
In addition, our five centers located in California represented 20% of our revenue in 2024 and 2023. As a result, our business, financial condition and results of operations could be adversely affected by disruptions in the Southern California economy resulting from recent wildfires.
In addition, our five centers located in California represented 20% of our revenue in 2025 and 2024. As a result, our business, financial condition and results of operations could be adversely affected by disruptions in the Southern California economy.
Our ability to pay or to refinance our indebtedness will depend upon our future operating performance, which will be affected by general economic, financial, competitive, legislative, regulatory, business and other factors beyond our control. 25 Table of Contents On March 12, 2025, the Company, EBS Intermediate Parent LLC, a Delaware limited liability company and wholly-owned subsidiary of the Company (“EBS Parent”), EBS Enterprises LLC, a Delaware limited liability company (“Borrower”), Silicon Valley Bank, a division of First-Citizens Bank & Trust Company, as the administrative agent (“SVB”), and the lenders a party thereto entered into a Third Amendment to Credit Agreement (the “Third Amendment”) in connection with that certain Credit Agreement, dated as of November 7, 2022 (as amended by that certain First Amendment and Limited Waiver to Credit Agreement, dated as of March 9, 2023, by that certain Second Amendment to Credit Agreement, dated as of September 13, 2024, and by the Third Amendment, collectively, the “Credit Agreement”), among the Company, EBS Parent, Borrower, the several banks and other financial institutions or entities from time to time party thereto (each a “Lender” and, collectively, the “Lenders”) and SVB, the form of which was attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the U.S.
On March 12, 2025, the Company, EBS Intermediate Parent LLC, a Delaware limited liability company and wholly-owned subsidiary of the Company (“EBS Parent”), EBS Enterprises LLC, a Delaware limited liability company (“Borrower”), Silicon Valley Bank, a division of First-Citizens Bank & Trust Company, as the administrative agent (“SVB”), and the lenders a party thereto entered into a Third Amendment to Credit Agreement (the “Third Amendment”) in connection with that certain Credit Agreement, dated as of November 7, 2022 (as amended by that certain First Amendment and Limited Waiver to Credit Agreement, dated as of March 9, 2023, by that certain Second Amendment to Credit Agreement, dated as of September 13, 2024, and by the Third Amendment, collectively, the “Credit Agreement”), among the Company, EBS Parent, Borrower, the several banks and other financial institutions or entities from time to time party thereto (each a “Lender” and, collectively, the “Lenders”) and SVB, the form of which was attached as Exhibit 10.1 25 Table of Contents to the Company’s Current Report on Form 8-K filed with the U.S.
Our management team has limited experience managing a public company. Most members of our management team have limited experience managing a publicly traded company, interacting with public company investors, and complying with the increasingly complex laws pertaining to public companies.
Our management team has limited experience managing a public company. 28 Table of Contents Our management team has limited experience managing a publicly traded company, interacting with public company investors, and complying with the increasingly complex laws pertaining to public companies.
As of December 31, 2024, total outstanding indebtedness under our senior credit facility was approximately $75.8 million, consisting of $70.8 million in term loans (the “Term Loan”) and $5.0 million drawn on the revolving credit facility (the “Revolver”) (the “Term Loan and Revolving Credit Facility”).
As of December 31, 2025, total outstanding indebtedness under our senior credit facility was approximately $75.8 million, consisting of $56 million in term loans (the “Term Loan”) and there is $5.0 million available on our revolving credit facility (the “Revolver”) (the “Term Loan and Revolving Credit Facility”).
If no securities or industry analysts commence coverage of our Company, the trading price for our common stock would be negatively impacted. If we obtain securities or industry analyst coverage and if one or more of the analysts who covers us downgrades our common stock or publishes inaccurate or unfavorable research about our business, our stock price would likely decline.
If we obtain securities or industry analyst coverage and if one or more of the analysts who covers us downgrades our common stock or publishes inaccurate or unfavorable research about our business, our stock price would likely decline.
Opposition or cancellation proceedings may be filed against our trademarks, and our trademarks may not survive such proceedings. In the event that our trademarks are successfully challenged, we could be forced to rebrand our procedures or services, which could result in loss of brand recognition and could require us to devote resources towards advertising and marketing new brands.
In the event that our trademarks are successfully challenged, we could be forced to rebrand our procedures or services, which could result in loss of brand recognition and could require us to devote resources towards advertising and marketing new brands.
Risks Related to Ownership of Our Common Stock • We are an “emerging growth company,” and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our common stock less attractive to investors. • Our stock price could be extremely volatile, and, as a result, you may not be able to resell your shares at or above the price you paid for them. • There may be sales of a substantial amount of our common stock by our current stockholders, and these sales could cause the price of our common stock to fall. • Certain of our directors and executive officers hold a substantial portion of our common stock, which may lead to conflicts of interest with other stockholders over corporate transactions and other corporate matters. • Provisions in our charter documents and Delaware law may deter takeover efforts that could be beneficial to stockholder value. • We have no plans to pay cash dividends on our common stock for the foreseeable future. • Our internal controls may not be effective. • The requirements of being a public company may strain our resources and distract our management, which could make it difficult to manage our business. • Our stock price and trading volume could decline if securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business. • We may be subject to securities litigation, which is expensive and could divert management attention. 15 Table of Contents Risks Related to Our Business Our operating results could be adversely affected if we are unable to successfully implement certain cost savings initiatives and revenue growth strategies.
Risks Related to Ownership of Our Common Stock • After December 31, 2025, we will no longer qualify as an “emerging growth company” as defined in the JOBS Act and the reduced disclosure requirements applicable to emerging growth companies will no longer apply to us. • Our stock price could be extremely volatile, and, as a result, you may not be able to resell your shares at or above the price you paid for them. • There may be sales of a substantial amount of our common stock by our current stockholders, and these sales could cause the price of our common stock to fall. • Certain of our directors hold a substantial portion of our common stock, which may lead to conflicts of interest with other stockholders over corporate transactions and other corporate matters. • Provisions in our charter documents and Delaware law may deter takeover efforts that could be beneficial to stockholder value. • We have no plans to pay cash dividends on our common stock for the foreseeable future. • Our internal controls may not be effective. • The requirements of being a public company may strain our resources and distract our management, which could make it difficult to manage our business. 14 Table of Contents • Our stock price and trading volume could decline if securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business. • We may be subject to securities litigation, which is expensive and could divert management attention.
We do not maintain “key man” life insurance policies on any of our officers. Competition for senior management generally, and within the cosmetic surgery and healthcare industry specifically, is intense and we may not be able to recruit and retain the personnel we need if we were to lose an existing member of senior management.
Competition for senior management generally, and within the cosmetic surgery and healthcare industry specifically, is intense and we may not be able to recruit and retain the personnel we need if we were to lose an existing member of senior management.
We believe that our brand is important to attracting patients and high-quality surgeons. Maintaining, protecting, and enhancing our brand depends largely on our ability to deliver results for our patients and the success of our marketing efforts. We believe that the importance of our brand will increase as competition further intensifies.
Maintaining, protecting, and enhancing our brand depends largely on our ability to deliver consistent and beneficial results for our patients, and the success of our marketing efforts, and our ability to manage our public image. We believe that the importance of our brand will increase as competition further intensifies.
There may be sales of a substantial amount of our common stock by our current stockholders, and these sales could cause the price of our common stock to fall. As of March 13, 2025, there are 58,574,516 shares of common stock outstanding.
There may be sales of a substantial amount of our common stock by our current stockholders, and these sales could cause the price of our common stock to fall. As of March 30, 2026, there are 70,545,681 shares of common stock outstanding.
Any interruption in the supply of handpieces, or our inability to obtain substitute handpieces from alternate sources at acceptable prices in a timely manner, could harm our ability to perform AirSculpt ® procedures until new sources of supply are identified and qualified.
Any such interruptions to our supply chain could increase our costs and could limit the availability of products critical to our operations. 22 Table of Contents Any interruption in the supply of handpieces, or our inability to obtain substitute handpieces from alternate sources at acceptable prices in a timely manner, could harm our ability to perform AirSculpt ® procedures until new sources of supply are identified and qualified.
Our internal computer systems, or those of any of our manufacturers, other contractors, consultants, collaborators, or third party service providers may fail or suffer security or data privacy breaches or other unauthorized or improper access to, use of, or destruction of our proprietary or confidential data, employee data, or personal data, which could result in additional costs, loss of revenue, significant liabilities, harm to our brand and material disruption of our operations.
Our internal computer systems, or those of any of our manufacturers, other contractors, consultants, collaborators, or third party service providers may fail or suffer security or data privacy breaches or other unauthorized or improper access to, use of, or destruction of our proprietary or confidential data, employee data, or personal data, which could result in additional costs, loss of revenue, significant liabilities, harm to our brand and material disruption of our operations. 29 Table of Contents We use information technology systems, infrastructure, and data in many aspects of our business operations, and our ability to effectively manage our business depends significantly on the availability, reliability and capacity of these systems.
We cannot be sure that we will be successful in addressing these and other challenges we may face in the future, and our business may be adversely affected if we do not manage these risks. Our success depends on our ability to maintain the value and reputation of the AirSculpt ® brand.
We cannot be sure that we will be successful in addressing these and other challenges we may face in the future, and our business may be adversely affected if we do not manage these risks.
The length and impact of the ongoing military conflict is highly unpredictable, and resulted in market disruptions, including significant volatility in commodity prices, credit and capital markets, an increase in cyber security incidents as well as supply chain disruptions.
The length and impact of each ongoing conflict is highly unpredictable, and may result in market disruptions, including significant volatility in commodity prices, credit and capital markets, and increases in cybersecurity incidents as well as supply chain disruptions.
However, these choice of forum provisions may limit a stockholder’s ability to bring a Proceeding in a judicial forum that it finds favorable for disputes with us or our directors, officers, other employees or stockholders. 44 Table of Contents Further, these choice of forum provisions may increase the costs for a stockholder to bring such a Proceeding and may discourage them from doing so.
However, these choice of forum provisions may limit a stockholder’s ability to bring a Proceeding 43 Table of Contents in a judicial forum that it finds favorable for disputes with us or our directors, officers, other employees or stockholders.
Despite the implementation of security measures, our internal computer systems and those of our current and any other contractors, consultants, collaborators and third-party service providers, such measures may not be effective in every instance. 30 Table of Contents Cybercrime and hacking techniques are constantly evolving, and we and/or our third-party service providers may be unable to anticipate or avoid attempted or actual security breaches, react in a timely manner, or implement adequate preventative measures, particularly given the increasing use of hacking techniques designed to circumvent controls, avoid detection, and remove or obfuscate forensic artifacts.
Cybercrime and hacking techniques are constantly evolving, and we and/or our third-party service providers may be unable to anticipate or avoid attempted or actual security breaches, react in a timely manner, or implement adequate preventative measures, particularly given the increasing use of hacking techniques designed to circumvent controls, avoid detection, and remove or obfuscate forensic artifacts.
Even if our patent applications issue as patents, they may not issue in a form that will provide us with any meaningful protection, prevent competitors or other third parties from competing with us, or otherwise provide us with any competitive advantage. As a result, the issuance, scope, validity, enforceability and commercial value of our patent rights are highly uncertain.
Even if our patent applications issue as patents, they may not issue in a form that will provide us with any meaningful protection, prevent 32 Table of Contents competitors or other third parties from competing with us, or otherwise provide us with any competitive advantage.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur Audit Committee Chair holds a Certification in Cybersecurity Oversight from the National Association of Corporate Directors. The effectiveness of the cybersecurity and information security program is tested through a combination of internal and external assessments.
Biggest changeOur board of directors exercises its oversight role through the Audit Committee, which provides the board of directors with regular reports and findings from our Chief Financial Officer. Our Audit Committee Chair holds a Certification in Cybersecurity Oversight from the National Association of Corporate Directors.
Updates are provided to senior management and the Audit Committee on a quarterly basis for informed decision-making and as part of the Company's broader risk management process.
The effectiveness of the cybersecurity and information security program is tested through a combination of internal and external assessments. Updates are provided to senior management and the Audit Committee on a quarterly basis for informed decision-making and as part of the Company's broader risk management process.
Such a breach could expose us to business interruption, lost revenue, ransom payments, remediation costs, liabilities to affected parties, cybersecurity protection costs, lost assets, litigation, regulatory scrutiny and actions, reputational harm, customer dissatisfaction, harm to our vendor relationships, or loss of market share. 47 Table of Contents Our board of directors exercises its oversight role through the Audit Committee, which provides the board of directors with regular reports and findings from our Chief Financial Officer.
Such a breach could expose us to business interruption, lost revenue, ransom payments, remediation costs, liabilities to 46 Table of Contents affected parties, cybersecurity protection costs, lost assets, litigation, regulatory scrutiny and actions, reputational harm, customer dissatisfaction, harm to our vendor relationships, or loss of market share.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWe use these locations primarily for sales and marketing, information technology, social media content management, research and development, supply chain and logistics, finance, human resources, and editing related to AirSculpt ® TV. In addition to our corporate headquarters, as of the date of this Annual Report on Form 10-K, we operate thirty-two centers from which we offer AirSculpt ® procedures.
Biggest changeIn addition to our corporate headquarters, as of the date of this Annual Report on Form 10-K, we operate 31 centers from which we offer AirSculpt® procedures.
State/Country City Number of Procedure Rooms Arizona Scottsdale 2 California Beverly Hills 2 California Orange County 2 California Sacramento 3 California San Diego 2 California San Jose 2 Colorado Denver 2 Florida Orlando 2 Florida Miami 2 Georgia Atlanta 2 Illinois Chicago 2 Illinois Deerfield 2 Kansas Kansas City 2 Massachusetts Boston 3 Michigan Birmingham 2 Minnesota Minneapolis 2 Nevada Las Vegas 2 New York New York 2 New York White Plains 2 North Carolina Charlotte 2 North Carolina Raleigh 2 Ohio Columbus 2 Pennsylvania Philadelphia 2 Tennessee Nashville 2 Texas Austin 2 Texas Dallas 3 Texas Houston 2 Utah Salt Lake City 2 Washington Seattle 2 Virginia Vienna 2 Canada Toronto 2 United Kingdom London 2 48 Table of Contents We intend to procure additional space as we hire additional employees and expand geographically.
State/Country City Number of Procedure Rooms Arizona Scottsdale 2 California Beverly Hills 2 California Orange County 2 California Sacramento 3 California San Diego 2 California San Jose 2 Colorado Denver 2 Florida Orlando 2 Florida Miami 2 Georgia Atlanta 2 Illinois Chicago 2 Illinois Deerfield 2 Kansas Kansas City 2 Massachusetts Boston 3 Michigan Birmingham 2 Minnesota Minneapolis 2 Nevada Las Vegas 2 New York New York 2 New York White Plains 2 North Carolina Charlotte 2 North Carolina Raleigh 2 Ohio Columbus 2 Pennsylvania Philadelphia 2 Tennessee Nashville 2 Texas Austin 2 Texas Dallas 3 Texas Houston 2 Utah Salt Lake City 2 Washington Seattle 2 Virginia Vienna 2 Canada Toronto 2 47 Table of Contents We intend to procure additional space as we hire additional employees and expand geographically.
Item 2. Properties Our corporate headquarters are located in Miami Beach, Florida, where we occupy approximately 3,714 rentable square feet and Nashville, TN where we occupy approximately 3,332 square feet.
Item 2. Properties Our corporate headquarters are located in Miami Beach, Florida, where we occupy approximately 3,714 rentable square feet. We use these locations primarily for sales and marketing, information technology, social media content management, research and development, supply chain and logistics, finance, human resources, and editing related to AirSculpt ® TV.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeThese claims, to the extent they exceed our insurance deductibles, are covered by insurance, but there can be no assurance that our insurance coverage will be adequate to cover any such liability. Item 4. Mine Safety Disclosures Not applicable. 49 Table of Contents PART II
Biggest changeThese claims, to the extent they exceed our insurance deductibles, are covered by insurance, but there can be no assurance that our insurance coverage will be adequate to cover any such liability. Item 4. Mine Safety Disclosures Not applicable. 48 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeAny determination to pay future dividends to holders of our common stock will be at the discretion of our board of directors and will depend on many factors, including our financial condition, results of operations, projections, liquidity, earnings, legal requirements, restrictions in the agreements governing any indebtedness we may enter into and other factors that our board of directors deems relevant.
Biggest changeAny determination to pay future dividends to holders of our common stock will be at the discretion of our board of directors and will depend on many factors, including our financial condition, results of operations, projections, liquidity, earnings, legal requirements, restrictions in current and future agreements governing our indebtedness and other factors that our board of directors deem relevant.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our c ommon stock are traded on the Nasdaq Global Market under the symbol “AIRS.” Dividends During the twelve months ended December 31, 2024, we paid a $0.3 million dividend on our common stock.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our c ommon stock are traded on the Nasdaq Global Market under the symbol “AIRS.” Dividends During the twelve months ended December 31, 2025, no dividends have been declared or paid on our common stock.
Holders of Record As of March 13, 2025, there were 58,574,516 issued and outstanding shares of common stock held by 32 stockholders of record.
Holders of Record As of March 30, 2026, there were 70,545,681 issued and outstanding shares of common stock held by 22 stockholders of record.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeThe table also shows the percentage relationship to revenue for the periods indicated: Twelve Months Ended December 31, 2024 2023 2022 ($ in 000s) Amount % of Revenue Amount % of Revenue Amount % of Revenue Revenue $ 180,350 100.0 % $ 195,917 100.0 % $ 168,794 100.0 % Operating expenses: Cost of service 71,382 39.6 % 74,012 37.8 % 62,781 37.2 % Selling, general and administrative 98,880 54.8 % 102,381 52.3 % 101,418 60.1 % Depreciation and amortization 11,888 6.6 % 10,253 5.2 % 8,061 4.8 % Loss/(gain) on disposal of long-lived assets 16 — % (212) (0.1) % 147 0.1 % Total operating expenses 182,166 101.0 % 186,434 95.2 % 173,339 102.7 % Loss/(income) from operations (1,816) (1.0) % 9,483 4.8 % (4,545) (2.7) % Interest expense, net 6,247 3.5 % 6,485 3.3 % 6,751 4.0 % Pre-tax net (loss)/income (8,063) (4.5) % 2,998 1.5 % (11,296) (6.7) % Income tax (benefit)/expense 188 0.1 % 7,477 3.8 % 3,383 2.0 % Net loss $ (8,251) (4.6) % $ (4,479) (2.3) % $ (14,679) (8.7) % Twelve Months Ended December 31, 2024 Compared to Twelve Months Ended December 31, 2023 Overview— Our financial results for the twelve months ended December 31, 2024 compared to the twelve months ended December 31, 2023 reflect the addition of five de novo centers which increased procedure rooms by ten.
Biggest changeThe table also shows the percentage relationship to revenue for the periods indicated: Twelve Months Ended December 31, 2025 2024 2023 ($ in 000s) Amount % of Revenue Amount % of Revenue Amount % of Revenue Revenue $ 151,818 100.0 % $ 180,350 100.0 % $ 195,917 100.0 % Operating expenses: Cost of service 61,690 40.6 % 71,149 39.5 % 73,773 37.7 % Selling, general and administrative 82,180 54.1 % 98,880 54.8 % 102,381 52.3 % Depreciation and amortization 12,781 8.4 % 11,888 6.6 % 10,253 5.2 % Loss on impairment of long-lived assets 4,575 3.0 % 16 — % (212) (0.1) % Cost related to closing location, net 2,152 — % — — % — — % Total operating expenses 163,378 107.6 % 181,933 100.9 % 186,195 95.0 % (Loss)/income from operations (11,560) (7.6) % (1,583) (0.9) % 9,722 5.0 % Interest expense, net 6,078 4.0 % 6,247 3.5 % 6,485 3.3 % Pre-tax net (loss)/income (17,638) (11.6) % (7,830) (4.3) % 3,237 1.7 % Income tax (benefit)/expense (5,971) (3.9) % 188 0.1 % 7,477 3.8 % Net (loss)/income $ (11,667) (7.7) % $ (8,018) (4.4) % $ (4,240) (2.2) % Revenue— Our revenue decreased $28.5 million, or 15.8%, compared to the same period in 2024.
On November 7, 2022, the Company entered into the Term Loan and Revolving Credit Facility pursuant to the Credit Agreement with a syndicate of lenders, originally maturing November 7, 2027.
On November 7, 2022, the Company entered into the Term Loan and Revolving Credit Facility pursuant to the Credit agreement with a syndicate of lenders (the "Credit Agreement"), originally maturing November 7, 2027.
In addition to revising the covenants listed above, the amendment revised or added new terms such that (i) for outstanding loans, beginning on or about July 1, 2025, the applicable per annum margin will be increased to 3.75% or 4.75% for base rate or SOFR, respectively, if the Company's total leverage ratio is equal to or greater than 3.00x, 3.50% or 4.50% for base rate or SOFR, respectively, if the Company's total leverage ratio is equal to or greater than 2.00x and less than 3.00x, and 3.25% or 4.25% for base rate or SOFR, respectively, if the Company's total leverage ratio is below 2.00x, (ii) the Term Loan and Revolving Credit Facility will mature on May 11, 2027 (instead of November 7, 2027); (iii) Liquidity in excess of $3.0 million will be used to repay the outstanding funds drawn on the revolving credit facility on a monthly basis beginning April 30, 2025; (iv) revolver draws will be subject to compliance with the minimum Liquidity covenant; and (v) the Company will be required to reimburse SVB for certain fees and expenses relating to the engagement of a financial advisor, and (vi) 100% of first $10.0 million of any equity proceeds will be used to repay the Term Loan and Revolving Credit Facility, subject to a carve-out of the first $3.0 million of equity proceeds and any equity proceeds received from Sponsor.
In addition to revising the covenants listed above, the Third Amendment revised or added new terms such that (i) for outstanding loans, beginning on or about July 1, 2025, the applicable per annum margin will be increased to 3.75% or 4.75% for base rate or SOFR, respectively, if the Company's total leverage ratio is equal to or greater than 3.00x, 3.50% or 4.50% for base rate or SOFR, respectively, if the Company's total leverage ratio is equal to or greater than 2.00x and less than 3.00x, and 3.25% or 4.25% for base rate or SOFR, respectively, if the Company's total leverage ratio is below 2.00x, (ii) the Term Loan and Revolving Credit Facility will mature on May 11, 2027 (instead of November 7, 2027); (iii) Liquidity in excess of $3.0 million will be used to repay the outstanding funds drawn on the revolving credit facility on a monthly basis beginning April 30, 2025; (iv) revolver draws will be subject to compliance with the minimum Liquidity covenant; (v) the Company will be required to reimburse SVB for certain fees and expenses relating to the engagement of a financial advisor, and (vi) 100% of first $10.0 million of any equity proceeds will be used to repay the Term Loan and Revolving Credit Facility, subject to a carve-out of the first $3.0 million of equity proceeds and any equity proceeds received from our Sponsor.
Our ability to successfully operate new centers depends on many factors, including, among others, our ability to: • recruit qualified surgeons for our new centers; • address regulatory, competitive, marketing, and other challenges encountered in connection with expansion into new markets; • hire, train and retain surgeons and other personnel; • maintain adequate information system and other operational system capabilities; • successfully integrate new centers into our existing management structure and operations, including information system integration; • source sufficient levels of medical supplies at acceptable costs; • obtain and maintain necessary permits and licenses; • generate sufficient levels of cash or obtain financing on acceptable terms to support our expansion; • achieve and maintain brand awareness in new and existing markets; and • identify and satisfy the needs and preferences of our patients. 51 Table of Contents Our failure to effectively address challenges such as these could adversely affect our ability to operate new centers in a cost-effective manner.
Our ability to successfully operate new centers depends on many factors, including, among others, our ability to: • recruit qualified surgeons for our new centers; • address regulatory, competitive, marketing, and other challenges encountered in connection with expansion into new markets; • hire, train and retain surgeons and other personnel; • maintain adequate information system and other operational system capabilities; • successfully integrate new centers into our existing management structure and operations, including information system integration; • source sufficient levels of medical supplies at acceptable costs; • obtain and maintain necessary permits and licenses; • generate sufficient levels of cash or obtain financing on acceptable terms to support our expansion; • achieve and maintain brand awareness in new and existing markets; and • identify and satisfy the needs and preferences of our patients. 50 Table of Contents Our failure to effectively address challenges such as these could adversely affect our ability to operate new centers in a cost-effective manner.
Each surgeon owner of a Professional Association (each a “Surgeon Owner,” and collectively, the “Surgeon Owners”) is also party to a continuity agreement (each, a “Continuity Agreement,” and collectively, the “Continuity Agreements”), which (i) prohibits the applicable surgeons from freely transferring or selling their interests in the Professional Associations, (ii) provides for the ability to add a second surgeon equity holder to help ensure continuity of the Professional Association, and (iii) provides for the automatic transfer of ownership upon the occurrence of certain events, save that, due to limitations under New York law, there is no Continuity Agreement in place with respect to the New York Professional Association.
Each surgeon owner of a Professional Association (each a “Surgeon Owner,” and collectively, the “Surgeon Owners”) is also party to a continuity agreement (each, a “Continuity Agreement,” and collectively, the “Continuity Agreements”), which (i) prohibits the applicable surgeons from freely transferring or selling their interests in the Professional Associations, (ii) provides for the ability to add a second surgeon equity holder to help ensure continuity of the Professional Association, and (iii) provides for the automatic transfer of ownership upon the occurrence of certain 62 Table of Contents events, save that, due to limitations under New York law, there is no Continuity Agreement in place with respect to the New York Professional Association.
Adjusted EBITDA has limitations as an analytical tool including: (i) Adjusted EBITDA does not include results from equity-based compensation and (ii) Adjusted EBITDA does not reflect 53 Table of Contents interest expense on our debt or the cash requirements necessary to service interest or principal payments.
Adjusted EBITDA has limitations as an analytical tool including: (i) Adjusted EBITDA does not include results from equity-based compensation and (ii) Adjusted EBITDA does not reflect 52 Table of Contents interest expense on our debt or the cash requirements necessary to service interest or principal payments.
We review goodwill for impairment annually in the month of October. We performed our annual review of goodwill impairment in October 2024 and 2023 using a qualitative analysis and determined that a quantitative analysis was not required. There were no triggering events during the twelve months ended December 31, 2024 and 2023.
We review goodwill for impairment annually in the month of October. We performed our annual review of goodwill impairment in October 2025 and 2024 using a qualitative analysis and determined that a quantitative analysis was not required. There were no triggering events during the twelve months ended December 31, 2025 and 2024.
As such, for the period of September 13, 2024 through June 30, 2025, the applicable per annum margin is 2.5% or 3.5% for base rate or SOFR, respectively, if the Company's total leverage ratio is equal to or greater than 2.0x.
As such, for the period of September 13, 2024 through June 30, 2025, the applicable per annum margin was 2.5% or 3.5% for base rate or SOFR, respectively, if the Company's total leverage ratio was equal to or greater than 2.0x.
Key Factors Affecting Our Performance Our results of operations and financial condition have been, and will continue to be, affected by a number of factors, including the following: 50 Table of Contents Growth Initiatives and Strategic Priorities Given the recent decline in revenue, the Company is focusing on stabilizing revenue growth through a number of strategic and growth initiatives, including: • optimizing our marketing investment by spending on techniques that have proven successful for us in the past using a returns-based approach and testing new areas such as online video, and other social marketing channels under the direction of our new Chief Digital Officer; • improving our go-to-market and sales strategies under our new Chief Sales Officer who is dedicated to strengthening our consultative sales model with enhanced training, improving our sales processes, and providing a greater focus on lead conversion; • expanding consumer financing offerings; and • focusing on new product innovation where we believe that there is an opportunity to introduce new services, particularly in the area of skin tightening, that would allow us to expand our customer reach and generate incremental revenues.
Key Factors Affecting Our Performance Our results of operations and financial condition have been, and will continue to be, affected by a number of factors, including the following: 49 Table of Contents Growth Initiatives and Strategic Priorities Given the continued decline in its revenue, the Company is focusing returning to revenue growth through a number of strategic and growth initiatives, including: • optimizing our marketing investment by spending on techniques that have proven successful for us in the past using a returns-based approach and testing new areas such as online video, and other social marketing channels under the direction of our Chief Digital Officer; • improving our go-to-market and sales strategies under our Chief Sales Officer who is dedicated to strengthening our consultative sales model with enhanced training, improving our sales processes, and providing a greater focus on lead conversion; • expanding consumer financing offerings; and • focusing on new product innovation where we believe that there is an opportunity to introduce new services, particularly in the area of skin tightening, that would allow us to expand our customer reach and generate incremental revenues.
General and administrative expenses include employee-related expenses, including salaries and related costs (excluding physician and clinical cost included in cost of service), equity-based compensation, technology, operations, finance, legal, corporate office rent and human resources. General and administrative expense were approximately $54.9 million and 57 Table of Contents $65.6 million for the twelve months ended December 31, 2024 and 2023, respectively.
General and administrative expenses include employee-related expenses, including salaries and related costs (excluding physician and clinical cost included in cost of service), equity-based compensation, technology, operations, finance, legal, corporate office rent and human resources. General and administrative expense were approximately $54.9 million and $65.6 million for the twelve months ended December 31, 2024 and 2023, respectively.
For the years ended December 31, 2023 and 2022, we define same-center case and revenue growth as the growth in each of our cases and revenue at facilities that have been owned and operated for at least twelve months as of December 31, 2023.
For the years ended December 31, 2024 and 2023, we define same-center case and revenue growth as the growth in each of our cases and revenue at facilities that have been owned and operated for at least twelve months as of December 31, 2024.
Under the terms of the Third Amendment, the parties thereto agreed to modify certain financial condition covenants made by the Company under the Term Loan and Revolving Credit Facility, such that (i) the Consolidated Fixed Charge Coverage Ratio (as defined in the Credit Agreement) of the Company and its subsidiaries as of the last day of the fiscal quarters ending March 31, 2025 and June 30, 2025 must be no less than 0.50x and 1.10x, respectively, and no less than 1.25x on the last day of the fiscal quarters ending September 30, 2025 and thereafter, instead of 1.10x as of March 31, 2025 and 1.25x as of June 30, 2025 and thereafter, as previously set forth in the Credit Agreement; (ii) the Consolidated Leverage Ratio (as defined in the Credit Agreement) of the Company and its subsidiaries as of the last day of the fiscal quarters ending March 31, 2025, June 30, 2025, September 30, 2025, December 31, 2025 and March 31, 2026, must not exceed 4:25x, 3.50x 3.25x, 3.25x, and 2.75x, respectively, and the Consolidated Leverage Ratio as of the last day of each fiscal quarter thereafter must not exceed 2.25x, instead of 3.25x as of March 31, 2025, 2.75x as of June 30, 2025, and 2.25x thereafter, as previously set forth in the Credit Agreement; (iii) the Company and its subsidiaries will be required to maintain minimum Liquidity (as defined in the Credit Agreement) of not less than (A) $3,000,000.00 as of the last day of the month ending March 31, 2025, (B) $5,000,000 as of the last day of the month ending April 30, 2025, and (C) $7,500,000.00 as of the last day of the months ending May 31, 2025 and thereafter (or the last day of each fiscal quarter thereafter upon the satisfaction of certain financial tests described therein); and (iv) new liquidity and financial reporting requirements have been added.
Under the terms of the Third Amendment, the parties thereto agreed to modify certain financial condition covenants made by the Company under the Term Loan and Revolving Credit Facility, such that (i) the Consolidated Fixed Charge Coverage Ratio (as defined in the Credit 60 Table of Contents Agreement) of the Company and its subsidiaries as of the last day of the fiscal quarters ending March 31, 2025 and June 30, 2025 must be no less than 0.50x and 1.10x, respectively, and no less than 1.25x on the last day of the fiscal quarters ending September 30, 2025 and thereafter, instead of 1.10x as of March 31, 2025 and 1.25x as of June 30, 2025 and thereafter, as previously set forth in the Credit Agreement; (ii) the Consolidated Leverage Ratio (as defined in the Credit Agreement) of the Company and its subsidiaries as of the last day of the fiscal quarters ending March 31, 2025, June 30, 2025, September 30, 2025, December 31, 2025 and March 31, 2026, must not exceed 4.25x, 3.50x 3.25x, 3.25x, and 2.75x, respectively, and the Consolidated Leverage Ratio as of the last day of each fiscal quarter thereafter must not exceed 2.25x, instead of 3.25x as of March 31, 2025, 2.75x as of June 30, 2025, and 2.25x thereafter, as previously set forth in the Credit Agreement; (iii) the Company and its subsidiaries will be required to maintain minimum Liquidity (as defined in the Credit Agreement) of not less than (A) $3.0 million as of the last day of the month ending March 31, 2025, (B) $5.0 million as of the last day of the month ending April 30, 2025, and (C) $7.5 million as of the last day of the months ending May 31, 2025 and thereafter (or the last day of each fiscal quarter thereafter upon the satisfaction of certain financial tests described therein); and (iv) new liquidity and financial reporting requirements have been added.
If the Company's total leverage ratio is equal to or greater than 1.0x and less than 2.0x, the applicable per annum margin is 2.0% or 3.0% for base rate or SOFR, respectively. If the Company's total leverage ratio is below 1.0x, the applicable per annum margin is 1.5% or 2.5% for base rate or SOFR, respectively.
If the Company's total leverage ratio was equal to or greater than 1.0x and less than 2.0x, the applicable per annum margin was 1.5% or 2.5% for base rate or SOFR, respectively. If the Company's total leverage ratio is below 1.0x, the applicable per annum margin was 1.0% or 2.0% for base rate or SOFR, respectively.
Our Ability to Successfully Operate in New Markets Our growth strategy depends, in large part, on successfully operating our new facilities, both in existing and new geographic regions, particularly in densely populated and affluent metropolitan and suburban regions.
Our Ability to Successfully Operate in New Markets Our long-term growth strategy depends, in large part, on successfully operating our new facilities, both in existing and new geographic regions, particularly in densely populated and affluent metropolitan and suburban regions.
Twelve Months Ended December 31, 2023 Compared to Twelve Months Ended December 31, 2022 Overview — Our financial results for the twelve months ended December 31, 2023 compared to the twelve months ended December 31, 2022 reflect the addition of five de novo centers which increased procedure rooms by 10.
Twelve Months Ended December 31, 2024 Compared to Twelve Months Ended December 31, 2023 Overview — Our financial results for the twelve months ended December 31, 2024 compared to the twelve months ended December 31, 2023 reflect the addition of five de novo centers which increased procedure rooms by 10.
This discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. See the section entitled “Cautionary Note Regarding Forward-Looking Statements” in this Annual Report on Form 10-K. Our actual results could differ materially from those anticipated in the forward-looking statements for many reasons, including those risks.
This discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. See the section entitled "Cautionary Note Regarding Forward-Looking Statements" in this Annual Report on Form 10-K. Our actual results could differ materially from those anticipated in the forward-looking statements for many reasons, including those risks.
We define same-center facilities and procedure rooms as facilities and procedure rooms that have been owned or operated for at least twelve months as of December 31, 2023.
We define same-center facilities and procedure rooms as facilities and procedure rooms that have been owned or operated for at least twelve months as of December 31, 2024.
We define Adjusted EBITDA as net loss excluding depreciation and amortization, net interest expense, income tax expense, restructuring and related severance costs, loss on debt modification , loss/(gain) on disposal of long-lived assets, settlement costs for non-recurring litigation, and equity-based compensation.
We define Adjusted EBITDA as net loss excluding depreciation and amortization, net interest expense, income tax (benefit)/expense, restructuring and related severance costs, Loss/(gain) on disposal of long-lived assets, settlement costs for non-recurring litigation, and equity-based compensation.
Treasury yield of treasury bonds with a maturity that approximates the expected term of the market-based PSU awards. • Expected dividend yield—The dividend yield is based on the current expectations of dividend payouts. The Company does not anticipate paying any cash dividends in the foreseeable future.
Treasury yield of treasury bonds with a maturity that approximates the expected term of the market-based PSU awards. 63 Table of Contents • Expected dividend yield—The dividend yield is based on the current expectations of dividend payouts. The Company does not anticipate paying any cash dividends in the foreseeable future.
Our policy is to require payment for services in advance of performing any procedure. Payments received for which services have yet to been performed were $1.2 million as of December 31, 2024 and $1.5 million as of December 31, 2023, respectively and are included in deferred revenue and patient deposits on our balance sheets.
Our policy is to require payment for services in advance of performing any procedure. Payments received for which services have yet to been performed were $1.9 million as of December 31, 2025 and $1.2 million as of December 31, 2024, respectively and are included in deferred revenue and patient deposits on our balance sheets.
Therefore, we mainly operate by maintaining MSAs with our affiliated Professional 62 Table of Contents Associations, which are owned, directly or indirectly, and operated by a licensed surgeon, and which contract with individual surgeons to provide medical services. Under the MSAs, we provide and perform non-medical Management Services for which we are paid a management fee by each Professional Association.
Therefore, we mainly operate by maintaining MSAs with our affiliated Professional Associations, which are owned, directly or indirectly, and operated by a licensed surgeon, and which contract with individual surgeons to provide medical services. Under the MSAs, we provide and perform non-medical Management Services for which we are paid a management fee by each Professional Association.
The decrease is due to the lower principal balance resulting from the Company's voluntary $10 million prepayment made in 2023. Income Tax Expense— Our effective tax rate is (2.3)% and 249.4% for the twelve months ended December 31, 2024 and 2023, respectively.
The decrease is due to the lower principal balance resulting from the Company's voluntary $10 million prepayment made in 2023. 57 Table of Contents Income Tax Expense — Our effective tax rate is (2.3)% and 249.4% for the twelve months ended December 31, 2024 and 2023, respectively.
Under the Credit Agreement, all outstanding loans bear interest based on either a base rate or SOFR plus an applicable per annum margin. The applicable per annum margin is 2.0% or 3.0% for base rate or SOFR, respectively, if the Company's total leverage ratio is equal to or greater than 2.0x.
Under the Credit Agreement, all outstanding loans originally bore interest based on either a base rate or SOFR plus an applicable per annum margin. The applicable per annum margin was 2.0% or 3.0% for base rate or SOFR, respectively, if the Company's total leverage ratio was equal to or greater than 2.0x.
Cost of service was 39.6% and 37.8% as a percentage of revenue for the twelve months ended December 31, 2024 and 2023, respectively. The percentage increase is primarily due to the decline in revenue and not being able to leverage certain fixed costs within cost of service such as rent and certain nursing costs.
Cost of service was 40.6% and 39.5% as a percentage of revenue for the twelve months ended December 31, 2025 and 2024, respectively. The percentage increase is primarily due to the decline in revenue and not being able to leverage certain fixed costs within cost of service such as rent and certain nursing costs.
You should read this Annual Report completely, including Part I, Item 1A (Risk Factors) of this Annual Report and the “Forward-Looking Statements” sections of this Annual Report for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by our forward-looking statements contained in the following discussion and analysis.
You should read this Annual Report completely, including Part I, Item 1A (Risk Factors) of this Annual Report and the section titled “Cautionary Note Regarding Forward-Looking Statements” in this Annual Report for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by our forward-looking statements contained in the following discussion and analysis.
Key Operational and Business Metrics In addition to the measures presented in our consolidated financial statements, we use the following key operational and business metrics to evaluate our business, measure our performance, develop financial forecasts and make strategic decisions: Twelve months ended December 31, 2024, 2023 and 2022 • Cases performed were 14,036, 14,932 and 13,063 in 2024, 2023 and 2022, respectively; • Revenue per case was $12,849, $13,121 and $12,922 in 2024, 2023 and 2022, respectively; • Same-center information: ◦ Same-center revenue per case increased (2.4)%, 1.5%, and 7.4% in 2024, 2023, and 2022, respectively; ◦ Same-center volume changed (13.7)%, (1.4)%, and 0.7% in 2024, 2023, and 2022, respectively; • Net loss was $(8.3) million, $(4.5) million and $(14.7) million in 2024, 2023 and 2022, respectively; • Adjusted EBITDA* was $20.7 million, $43.2 million and $38.9 million in 2024, 2023 and 2022, respectively; • Adjusted EBITDA Margin* was 11.5%, 22.1% and 23.0% in 2024, 2023 and 2022, respectively; • Loss per share was $(0.14), $(0.08) and $(0.26) for 2024, 2023 and 2022, respectively; and • Adjusted Net Income per share (diluted)* was $0.02, $0.28 and $0.32 in 2024, 2023 and 2022, respectively. * For a reconciliation of Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Income and Adjusted Net Income per share, which are all non-GAAP measures, to the most directly comparable GAAP financial measures, information about why we consider them useful and a discussion of the material risks and limitations of these measures, please see “—Non-GAAP Financial Measures—Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income and Adjusted Net Income per Share.” Cases Performed and Revenue per Case Our case volumes in the table below, which are used for calculating revenue per case, represent one patient visit; notwithstanding that, a patient may have multiple areas treated during one visit.
Key Operational and Business Metrics In addition to the measures presented in our consolidated financial statements, we use the following key operational and business metrics to evaluate our business, measure our performance, develop financial forecasts and make strategic decisions: Twelve months ended December 31, 2025, 2024 and 2023 • Cases performed were 11,852, 14,036 and 14,932 in 2025, 2024 and 2023, respectively; • Revenue per case was $12,809, $12,849 and $13,121 in 2025, 2024 and 2023, respectively; • Same-center information: ◦ Same-center revenue per case changed 0.1%, (2.4)%, and 1.5% in 2025, 2024, and 2023, respectively; ◦ Same-center volume changed (22.1)%, (13.7)%, and (1.4)% in 2025, 2024, and 2023, respectively; • Net loss was $(11.7) million, $(8.0) million and $(4.2) million in 2025, 2024 and 2023, respectively; • Adjusted EBITDA* was $15.1 million, $21.0 million and $43.5 million in 2025, 2024 and 2023, respectively; • Adjusted EBITDA Margin* was 9.9%, 11.6% and 22.2% in 2025, 2024 and 2023, respectively; • Loss per share was $(0.19), $(0.14) and $(0.08) for 2025, 2024 and 2023, respectively; and • Adjusted Net Income per share (diluted)* was $(0.06), $0.02 and $0.29 in 2025, 2024 and 2023, respectively. * For a reconciliation of Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Income and Adjusted Net Income per share, which are all non-GAAP measures, to the most directly comparable GAAP financial measures, information about why we consider them useful and a discussion of the material risks and limitations of these measures, please see “—Non-GAAP Financial Measures—Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income and Adjusted Net Income per Share.” Cases Performed and Revenue per Case Our case volumes in the table below, which are used for calculating revenue per case, represent one patient visit; notwithstanding that, a patient may have multiple areas treated during one visit.
Our ability to improve operating results depends upon a significant number of factors, some of which are beyond our control. If we are unable to realize the anticipated savings or benefits, or otherwise fail to implement the growth strategies, the business operating results and liquidity may be adversely affected.
Our ability to improve operating results depends upon a significant number of factors, some of which are beyond our control. If we are unable to realize the anticipated savings or benefits, or otherwise fail to implement the growth strategies, the business operating results and liquidity may be adversely affected. Our term loan and revolver mature on May 11, 2027.
The Limited Guarantee is callable on June 15, 2025 (or upon the earlier occurrence of certain defaults described therein) if the Company has not prepaid the Term Loan (excluding regularly scheduled amortization) by $10.0 million as of such date.
The Limited Guarantee was callable on June 15, 2025 (or upon the earlier occurrence of certain defaults described therein) in the Company had not prepaid the Term Loan (excluding regularly scheduled amortization) by $10.0 million as of such date.
Long-Term Debt The carrying value of our total indebtedness was $74.7 million and $71.6 million, which includes unamortized deferred financing costs and issuance discount of $1.0 million and $1.2 million, and funds drawn on the revolving credit facility of $5.0 million and $—, as of December 31, 2024 and December 31, 2023, respectively.
Long-Term Debt The carrying value of our total indebtedness was $56.0 million and $74.7 million, which includes unamortized deferred financing costs and issuance discount of $0.9 million and $1.0 million, and funds drawn on the revolving credit facility of $0.0 million and $5.0 million, as of December 31, 2025 and December 31, 2024, respectively.
If the Company's total leverage ratio is equal to or greater than 1.0x and less than 2.0x, the applicable per annum margin is 1.5% or 2.5% for base rate or SOFR, respectively.
If the Company's total leverage ratio was equal to or greater than 1.0x and less than 2.0x, the applicable per annum margin was 2.0% or 3.0% for base rate or SOFR, respectively. If the Company's total leverage ratio was below 1.0x, the applicable per annum margin was 1.5% or 2.5% for base rate or SOFR, respectively.
General and administrative expenses include employee-related expenses, including salaries and related costs (excluding physician and clinical cost included in cost of service), equity-based compensation, technology, operations, finance, legal, corporate office rent and human resources. General and administrative expense were approximately $65.6 million and $71.3 million for the twelve months ended December 31, 2023 and 2022, respectively.
General and administrative expenses include employee-related expenses, including salaries and related costs (excluding physician and clinical cost included in cost of service), equity-based compensation, technology, operations, finance, legal, corporate office rent and human resources. General and administrative expense were approximately $45.3 million and $57.5 million for the twelve months ended December 31, 2025 and 2024, respectively.
Twelve Months Ended December 31, 2023 2022 Cases 12,859 13,041 Case growth (1.4) % N/A Revenue per case $13,114 $12,923 Revenue per case growth 1.5 % N/A Number of total facilities 21 21 Number of total procedure rooms 45 45 Non-GAAP Financial Measures—Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, and Adjusted Net Income per Share We report our financial results in accordance with accounting principles generally accepted in the United States of America ("GAAP"), however, management believes the evaluation of our ongoing operating results may be enhanced by a presentation of Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income and Adjusted Net Income per Share, which are non-GAAP financial measures.
Twelve Months Ended December 31, 2024 2023 Cases 12,892 14,932 Case growth (13.7) % N/A Revenue per case $12,801 $13,121 Revenue per case growth (2.4) % N/A Number of total facilities 21 21 Number of total procedure rooms 45 45 Non-GAAP Financial Measures—Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, and Adjusted Net Income per Share We report our financial results in accordance with accounting principles generally accepted in the United States of America ("GAAP"), however, management believes the evaluation of our ongoing operating results may be enhanced by a presentation of Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income and Adjusted Net Income per Share, which are non-GAAP financial measures.
Total Case and Revenue Metrics Twelve Months Ended December 31, 2024 2023 2022 Cases 14,036 14,932 13,063 Case growth (6.0) % 14.3 % N/A Revenue per case $ 12,849 $ 13,121 $ 12,922 Revenue per case growth (2.1) % 1.5 % N/A Number of facilities 32 27 22 Number of total procedure rooms 67 57 47 Same-Center Case and Revenue Metrics Same-Center Information 52 Table of Contents For the twelve months ended December 31, 2024 and 2023, we define same-center case and revenue growth as the growth in each of our cases and revenue at facilities that were owned and operated during the twelve months ended December 31, 2024 and 2023, respectively.
Total Case and Revenue Metrics Twelve Months Ended December 31, 2025 2024 2023 Cases 11,852 14,036 14,932 Case growth (15.6) % (6.0) % 14.3 % Revenue per case $ 12,809 $ 12,849 $ 13,121 Revenue per case growth (0.3) % (2.1) % 1.5 % Number of facilities 31 32 27 Number of total procedure rooms 65 67 57 Same-Center Case and Revenue Metrics Same-Center Information 51 Table of Contents For the twelve months ended December 31, 2025 and 2024, we define same-center case and revenue growth as the growth in each of our cases and revenue at facilities that were owned and operated during the twelve months ended December 31, 2025 and 2024, respectively.
During the twelve months ended December 31, 2024, we made principal payments on our debt of $2.1 million, borrowed $5.0 million on our revolving credit facility, and made payments of taxes withheld through vested equity-based compensation of $0.9 million. Net cash used in financing activities for the twelve months ended December 31, 2023 was $13.4 million.
Net cash used in financing activities for the twelve months ended December 31, 2024 was $0.6 million. For the twelve months ended December 31, 2024, we made principal payments on our debt of $2.1 million and made payments of taxes withheld through vested equity-based compensation of $0.9 million.
Our policy is to require full payment for services in advance of performing a procedure. Payments received for which services have yet to been performed for all reported periods are included in deferred revenue and patient deposits on our balance sheets.
We recognize revenue based on the expected transaction price which is reduced for financing fees. Our policy is to require full payment for services in advance of performing a procedure. Payments received for which services have yet to been performed for all reported periods are included in deferred revenue and patient deposits on our balance sheets.
In consideration of the Third Amendment, the Company paid a fee equal to 0.15% of the outstanding loans to consenting Lenders, and a $125,000 arrangement fee to SVB.
In consideration of the Third Amendment, the Company paid a fee equal to 0.15% of the outstanding loans to consenting Lenders, and a $125 thousand arrangement fee to Silicon Valley Bank.
We do not have any letters of credit outstanding as of December 31, 2024. As of December 31, 2023, we had $10.3 million in cash and cash equivalents and an available amount of $5.0 million under our revolving credit facility. We did not have any letters of credit outstanding as of December 31, 2023.
As of December 31, 2025, we had $8.4 million in cash and cash equivalents and an available amount of $5.0 million under our revolving credit facility. We did not have any letters of credit outstanding as of December 31, 2025.
Selling, general and administrative expenses as a percent of revenue were 52.3% and 60.1% for the twelve months ended December 31, 2023 and 2022, respectively. Selling expenses consist of advertising costs for social, digital and traditional marketing and sales and marketing personnel.
Selling, general and administrative expenses as a percent of revenue were 54.1% and 54.8% for the twelve months ended December 31, 2025 and 2024, respectively. Selling expenses consist of advertising costs for social, digital and traditional marketing and sales and marketing personnel.
The following table summarizes the net cash provided by (used for) operating activities, investing activities and financing activities for the periods indicated: Twelve Months Ended December 31, ($ in 000s) 2024 2023 2022 Cash Flows Provided By (Used For): Operating activities $ 11,350 $ 23,956 $ 24,447 Investing activities (14,007) (9,919) (12,921) Financing activities 630 (13,391) (27,257) Net (decrease)/increase in cash and cash equivalents (2,027) 646 (15,731) Operating Activities The primary source of our operating cash flow is the collection of patient payments received prior to performing surgical procedures.
The following table summarizes the net cash provided by (used for) operating activities, investing activities and financing activities for the periods indicated: Twelve Months Ended December 31, ($ in 000s) 2025 2024 2023 Cash Flows Provided By (Used For): Operating activities $ 3,096 $ 11,350 $ 23,956 Investing activities (2,404) (14,007) (9,919) Financing activities (478) 630 (13,391) Net decrease in cash and cash equivalents 214 (2,027) 646 58 Table of Contents Operating Activities The primary source of our operating cash flow is the collection of patient payments received prior to performing surgical procedures.
We generally expect our selling expenses to increase as we continue to grow our brand and expand our national footprint. We evaluate our selling expense as compared to growth in our sales volume and will invest accordingly to the extent we believe we can position ourselves for future growth without materially negatively impacting our Adjusted EBITDA Margins.
We evaluate our selling expense as compared to growth in our sales volume and will invest accordingly to the extent we believe we can position ourselves for future growth without materially negatively impacting our Adjusted EBITDA Margins.
For the twelve months ended December 31, 2024, our operating cash flow decreased by $12.6 million compared to the same period in 2023. The decrease is primarily attributed to weaker than expected revenue performance and an increase in our marketing investments during the twelve months ended December 31, 2024 as compared to the prior year period.
For the twelve months ended December 31, 2025, our operating cash flow decreased by $8.3 million compared to the same period in 2024. The decrease is primarily attributed to weaker than expected revenue performance during the twelve months ended December 31, 2025 as compared to the prior year period.
This amount does not reflect any prepayments. (2) Amounts in the table reflect the contractually required interest payable pursuant to borrowings under our debt related to our Credit Agreement. Interest payments in the table above were calculated using an interest rate of 7.86% for the debt which was the interest rate applicable to the borrowing as of December 31, 2024.
(2) Amounts in the table reflect the contractually required interest payable pursuant to borrowings under our debt related to our Credit Agreement. Interest payments in the table above were calculated using an interest rate of 8.47% for the debt which was the interest rate applicable to the borrowing as of December 31, 2025.
This increase is related to additional expenses we incurred for marketing and corporate support as we grow our center count through de novo expansion and providing support for our centers, offset by a decrease in our equity-based compensation expense.
This decrease is related to a decrease in our equity-based compensation expense partially offset by additional expenses we incurred for marketing and corporate support as we grow our center count through de novo expansion and providing support for our centers. Selling expenses consist of advertising costs for social, digital and traditional marketing and sales and marketing personnel.
For the twelve months ended December 31, 2024, 2023, and 2022 pre-opening de novo and relocation costs were $1.0 million, $3.3 million, and $4.3 million, respectively. 54 Table of Contents The following table reconciles Adjusted Net Income and Adjusted Net Income per Share to net loss, the most directly comparable GAAP financial measure: Twelve Months Ended December 31, ($ in thousands) 2024 2023 2022 Net loss $ (8,251) $ (4,479) $ (14,679) Plus Equity-based compensation (1) 3,762 18,224 29,457 Loss on debt modification — — 932 IPO related costs — — 731 Restructuring and related severance costs 6,026 5,488 4,111 Loss/(gain) on disposal of long-lived assets 16 (212) 147 Litigation settlements 850 — — Tax effect of adjustments (1,271) (2,732) (2,195) Adjusted net (loss)/income $ 1,132 $ 16,289 $ 18,504 Adjusted net (loss)/income per share of common stock (2) Basic $ 0.02 $ 0.29 $ 0.33 Diluted $ 0.02 $ 0.28 $ 0.32 Weighted average shares outstanding Basic 57,688,906 56,778,793 55,684,701 Diluted 58,281,133 57,611,469 57,918,005 (1) During the first quarter of fiscal year 2024, the Company recorded a cumulative reversal of stock compensation expense of $10.4 million related to reassessing the probability of achieving the performance target on certain of the Company's performance-based stock units.
For the twelve months ended December 31, 2025, 2024, and 2023 pre-opening de novo and relocation costs were $— million, $1.0 million, and $3.3 million, respectively. 53 Table of Contents The following table reconciles Adjusted Net (Loss)/Income and Adjusted Net (Loss)/Income per Share to net loss, the most directly comparable GAAP financial measure: Twelve Months Ended December 31, ($ in thousands) 2025 2024 2023 Net loss $ (11,667) $ (8,018) $ (4,240) Plus Equity-based compensation (1) 2,331 3,762 18,224 Restructuring and related severance costs 4,818 6,026 5,488 Loss/(gain) on disposal of long-lived assets (2) 4,575 16 (212) Cost related to closing location, net (3) 2,152 — — Litigation settlements (4) — 850 — Tax effect of adjustments (6) (5,621) (1,271) (2,732) Adjusted net (loss)/income $ (3,412) $ 1,365 $ 16,528 Adjusted net (loss)/income per share of common stock (5) Basic $ (0.06) $ 0.02 $ 0.29 Diluted $ (0.06) $ 0.02 $ 0.29 Weighted average shares outstanding Basic 60,450,769 57,688,906 56,778,793 Diluted 60,450,769 58,281,133 57,611,469 (1) During the first quarter of fiscal year 2024, the Company recorded a cumulative reversal of stock compensation expense of $10.4 million related to reassessing the probability of achieving the performance target on certain of the Company's performance-based stock units.
At facilities that were not owned or operated for the entirety of the prior year period, the current year period has been pro-rated to reflect only growth experienced during the portion of the twelve months ended December 31, 2024 in which such facilities were owned and operated during the twelve months ended December 31, 2023.We define same-center facilities and procedure rooms based on if a facility was owned or operated as of December 31, 2023.
At facilities that were not owned or operated for the entirety of the prior year period, the current year period has been pro-rated to reflect only growth experienced during the portion of the twelve months ended December 31, 2025 in which such facilities were owned and operated during the twelve months ended December 31, 2024.
The following table reconciles Adjusted EBITDA and Adjusted EBITDA Margin to net loss, the most directly comparable GAAP financial measure: Twelve Months Ended December 31, ($ in thousands) 2024 2023 2022 Net loss $ (8,251) $ (4,479) $ (14,679) Plus Equity-based compensation (1) 3,762 18,224 29,457 Loss on debt modification — — 932 IPO related costs — — 731 Restructuring and related severance costs 6,026 5,488 4,111 Depreciation and amortization 11,888 10,253 8,061 Loss/(gain) on disposal of long-lived assets 16 (212) 147 Litigation settlements (2) 850 — Interest expense, net 6,247 6,485 6,751 Income tax expense 188 7,477 3,383 Adjusted EBITDA $ 20,726 $ 43,236 $ 38,894 Adjusted EBITDA Margin 11.5 % 22.1 % 23.0 % (1) During the first quarter of fiscal year 2024, the Company recorded a cumulative reversal of stock compensation expense of $10.4 million related to reassessing the probability of achieving the performance target on certain of the Company's performance-based stock units.
The following table reconciles Adjusted EBITDA and Adjusted EBITDA Margin to net loss, the most directly comparable GAAP financial measure: Twelve Months Ended December 31, ($ in thousands) 2025 2024 2023 Net loss $ (11,667) $ (8,018) $ (4,240) Plus Equity-based compensation (1) 2,331 3,762 18,224 Restructuring and related severance costs 4,818 6,026 5,488 Depreciation and amortization 12,781 11,888 10,253 Loss/(gain) on disposal of long-lived assets (2) 4,575 16 (212) Cost related to closing location, net (3) 2,152 — — Litigation settlements (4) — 850 — Interest expense, net 6,078 6,247 6,485 Income tax (benefit)/expense (5,971) 188 7,477 Adjusted EBITDA $ 15,097 $ 20,959 $ 43,475 Adjusted EBITDA Margin 9.9 % 11.6 % 22.2 % (1) During the first quarter of fiscal year 2024, the Company recorded a cumulative reversal of stock compensation expense of $10.4 million related to reassessing the probability of achieving the performance target on certain of the Company's performance-based stock units.
At December 31, 2023, we had working capital of $(4.4) million compared to $(5.6) million at December 31, 2022. 59 Table of Contents Investing Activities Net cash used in investing activities for the twelve months ended December 31, 2024, 2023, and 2022 was $14.0 million, $9.9 million, and $12.9 million, respectively.
At December 31, 2025, we had a working capital deficit of $(12.4) million compared to $(11.8) million at December 31, 2024. Investing Activities Net cash used in investing activities for the twelve months ended December 31, 2025 and 2024 was $2.4 million and $14.0 million, respectively.
We intend to continue investing in our sales and marketing capabilities as we add new centers. Additionally, selling expenses as a percentage of revenue may fluctuate from quarter to quarter based on the timing and scope of our initiatives and the related impact to our revenue.
Additionally, selling expenses as a percentage of revenue may fluctuate from quarter to quarter based on the timing and scope of our initiatives and the related impact to our revenue.
Revenue— Our revenue decreased $15.6 million, or 7.9%, compared to the same period in 2023. The decrease is primarily attributed to weaker than expected performance across the broader aesthetics and high-end retail industries. Cost of Service— Our cost of service decreased $2.6 million, or 3.6%, compared to the twelve months ended December 31, 2023.
Revenue —Our revenue decreased $15.6 million, or 7.9%, compared to the same period in 2023. The decrease is primarily attributed to lower case volume and lower rate. Cost of Service —Our cost of service decreased $2.6 million, or 3.6% compared to the twelve months ended December 31, 2023.
Selling, General and Administrative Expenses —Selling, general and administrative expenses increased $1.0 million, or 0.9%, for the twelve months ended December 31, 2023 compared to the same period in 2022.
Selling, General and Administrative Expenses— Selling, general and administrative expenses decreased $16.7 million, or 16.9%, for the twelve months ended December 31, 2025 compared to the same period in 2024.
We believe that the cash expected to be generated from operations will be sufficient for our working capital requirements, liquidity obligations, and payments due under our existing credit facilities for at least the next 12 months. As of December 31, 2024, we had $8.2 million in cash and cash equivalents with no availability under our revolving credit facility.
We believe that the cash expected to be generated from operations will be sufficient for our working capital requirements, liquidity obligations, and payments due under our existing credit facilities for at least the next 12 months.
Equity-Based Compensation We recognize equity-based compensation expense for employees and non-employees based on the grant-date fair value of awards over the applicable service period. See “Note 6 - Stockholders' Equity and Equity-based Compensation” for further 63 Table of Contents discussion of the awards outstanding.
Equity-Based Compensation We recognize equity-based compensation expense for employees and non-employees based on the grant-date fair value of awards over the applicable service period. See “Note 6 - Stockholders' Equity and Equity-based Compensation” for further discussion of the awards outstanding. The grant date fair value of awards that contain market-based conditions are estimated using a Monte Carlo simulation model.
Selling expenses consist of advertising costs for social, digital and traditional marketing and sales and marketing personnel. Total selling expenses were approximately $43.9 million and $36.8 million for the twelve months ended December 31, 2024 and 2023, respectively. Our customer acquisition costs were approximately $3,130 and $2,465 per customer in the twelve months ended December 31, 2024 and 2023, respectively.
Total selling expenses were approximately $43.9 million and $36.8 million for the twelve months ended December 31, 2024 and 2023, respectively. Our customer acquisition costs were approximately $3,130 and $2,465 per customer in the twelve months ended December 31, 2024 and 2023, respectively. We intend to continue investing in our sales and marketing capabilities as we add new centers.
See Note 6 to the consolidated financial statements included in this Annual Report on Form 10-K for further discussion. (2) This amount relates to settlement costs for non-recurring litigation of $0.9 million for the twelve months ended December 31, 2024.
(4) This amount relates to settlement costs for non-recurring litigation of $0.9 million for the three and nine months ended September 30, 2024. See Note 9 to the condensed consolidated financial statements included in the Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2024 for further discussion.
Critical Accounting Policies and Estimates Our management’s discussion and analysis of financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with GAAP.
December 31, 2025 is the last period the Company qualifies as an emerging growth company. 61 Table of Contents Critical Accounting Policies and Estimates Our management’s discussion and analysis of financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with GAAP.
We have irrevocably elected not to avail ourselves of this exemption from new or revised accounting standards and, therefore, will be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies. 61 Table of Contents Subject to certain conditions set forth in the JOBS Act, if, as an “emerging growth company,” we choose to rely on such exemptions we may not be required to, among other things, (i) provide an auditor’s attestation report on our system of internal controls over financial reporting pursuant to Section 404, (ii) provide all of the compensation disclosure that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act, (iii) comply with any requirement that may be adopted by the PCAOB regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (auditor discussion and analysis), and (iv) disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the CEO’s compensation to median employee compensation.
Subject to certain conditions set forth in the JOBS Act, if, as an “emerging growth company,” we choose to rely on such exemptions we may not be required to, among other things, (i) provide an auditor’s attestation report on our system of internal controls over financial reporting pursuant to Section 404, (ii) provide all of the compensation disclosure that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act (iv) disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the CEO’s compensation to median employee compensation.
Results of Operations 56 Table of Contents The following table and notes summarize certain results from the statements of operations for each of the periods indicated and the changes between periods.
Results of Operations 55 Table of Contents Twelve Months Ended December 31, 2025 Compared to Twelve Months Ended December 31, 2024 The following table and notes summarize certain results from the statements of operations for each of the periods indicated and the changes between periods.
We assist patients, as needed, by providing third-party financing options to pay for procedures. We have arrangements with various financing companies to 55 Table of Contents facilitate this option. There is a financing transaction fee based on a set percentage of the amount financed. We recognize revenue based on the expected transaction price which is reduced for financing fees.
We are 100% self-pay and do not accept payments from the U.S. federal government or payer organizations. We assist patients, as needed, by providing third-party financing options to pay for procedures. We have arrangements with various financing companies to facilitate this option. There is a financing transaction fee based on a set percentage of the amount financed.
Even though we do not have voting control over the Professional Associations, we have a long-term and unilateral controlling financial interest over such Professional Associations’ assets and operations under the MSAs. As a result, GAAP require us to consolidate the results of the Professional Associations into our financial statements.
Our consolidated financial statements present the results of operations and financial position of the Company, its wholly-owned subsidiaries and each of the Professional Associations that we manage under the MSAs. 54 Table of Contents Even though we do not have voting control over the Professional Associations, we have a long-term and unilateral controlling financial interest over such Professional Associations’ assets and operations under the MSAs.
The main driver of the difference between the effective and statutory rate is non-deductible executive compensation under Section 162(m) of the Internal Revenue Code. Liquidity and Capital Resources We principally rely on cash flows from operations as our primary source of liquidity and, if needed, up to $5.0 million in revolving loans under our revolving credit facility.
Liquidity and Capital Resources We principally rely on cash flows from operations as our primary source of liquidity and, if needed, up to $5.0 million in revolving loans under our revolving credit facility, subject to minimum liquidity draw requirements.
Twelve Months Ended December 31, 2024 2023 Cases 12,892 14,932 Case growth (13.7) % N/A Revenue per case $ 12,801 $ 13,121 Revenue per case growth (2.4) % N/A Number of facilities 27 27 Number of total procedure rooms 57 57 Our same-store revenue decline is primarily attributed to weaker than expected performance across the broader aesthetics and high-end retail industries.
Twelve Months Ended December 31, 2025 2024 Cases 10,670 13,689 Case growth (22.1) % N/A Revenue per case $ 12,798 $ 12,781 Revenue per case growth 0.1 % N/A Number of facilities 31 31 Number of total procedure rooms 65 65 Our same-center case decline is primarily attributed to weaker than expected performance across the broader aesthetics industry.
All of our revenue is earned from services provided by the Professional Associations we manage. See “Critical Accounting Policies and Estimates.” Components of Results of Operations Revenue Our revenue is generated from our patented AirSculpt ® procedures performed on our patients. We are 100% self-pay and do not accept payments from the U.S. federal government or payer organizations.
As a result, GAAP require us to consolidate the results of the Professional Associations into our financial statements. All of our revenue is earned from services provided by the Professional Associations we manage. See “Critical Accounting Policies and Estimates.” Components of Results of Operations Revenue Our revenue is generated from our patented AirSculpt ® procedures performed on our patients.
This reduction is due to a decrease in equity-based compensation. Depreciation and Amortization —Depreciation and amortization increased to approximately $10.3 million for the twelve months ended December 31, 2023 compared to $8.1 million for the same period in 2022.
This decrease relates to a $3.7 million decrease in severance expense, $1.6 million decrease in professional services, $1.3 million reduction in travel expense, and a $1.4 million reduction in stock compensation expense. 56 Table of Contents Depreciation and Amortization— Depreciation and amortization increased to approximately $12.8 million for the twelve months ended December 31, 2025 compared to $11.9 million for the same period in 2024.
For the twelve months ended December 31, 2022, we made distributions to our former member of $1.2 million, paid cash dividends to stockholders of $23.2 million, and made payments of taxes withheld through vested equity-based compensation of $2.0 million. Finally, we made principal payments on our debt of $84.3 million offset by borrowings of new debt of $83.5 million.
During the twelve months ended December 31, 2025, we received net proceeds of $13.8 million from an underwritten public offering, made principal payments on our debt of $13.8 million, payments for debt modification of $0.4 million, made payments of taxes withheld through vested equity-based compensation of $0.1 million, and received net proceeds of $5.3 million from the at the market offering.
As of December 31, 2024, the interest rate was 7.86%. On March 12, 2025, the Company entered the Third Amendment.
On March 12, 2025, the Company entered into the Third Amendment.
Total selling expenses were approximately $36.8 million and $30.1 million for the twelve months ended December 31, 2023 and 2022, respectively. Our customer acquisition costs were approximately $2,465 and $2,300 per customer in the twelve months ended December 31, 2023 and 2022, respectively.
Total selling expenses were approximately $36.9 million and $41.4 million for the twelve months ended December 31, 2025 and 2024, respectively. This decrease is primarily related to a decrease in advertising spend associated with brand awareness initiatives. Our customer acquisition costs were approximately $3,114 and $2,950 per customer in the twelve months ended December 31, 2025 and 2024, respectively.
The grant date fair value of awards that contain market-based conditions are estimated using a Monte Carlo simulation model. Determining the fair value of market-based awards requires judgment.
Determining the fair value of market-based awards requires judgment.
See Note 6 to the consolidated financial statements included in this Annual Report on Form 10-K for further discussion. (2) Diluted Adjusted Net Income Per Share is computed by dividing adjusted net income by the weighted-average number of shares of common stock outstanding adjusted for the dilutive effect of all potential shares of common stock.
(5) Diluted Adjusted Net Income Per Share is computed by dividing adjusted net income by the weighted-average number of shares of common stock outstanding adjusted for the dilutive effect of all potential shares of common stock. (6) Within the tax effect of adjustments, any disallowed stock compensation related to 162(m) is used to offset equity-based compensation recognized under GAAP.
If the Company's total leverage ratio is below 1.0x, the applicable per annum margin is 1.0% or 2.0% for base rate or SOFR, respectively. 60 Table of Contents On September 13, 2024, the Company amended the Credit Agreement to modify certain financial condition covenants and the applicable margins.
On September 13, 2024, the Company amended the Credit Agreement to modify certain financial condition covenants and the applicable margins.
Investing activities during all three periods were attributable to the preparation for the opening of de novo locations and the relocation of multiple existing facilities. Financing Activities Net cash used in financing activities during the twelve months ended December 31, 2024 was $0.6 million.
Investing activities in the twelve months ended December 31, 2025 relate primarily to final payments on our White Plains, NY location that opened in December 2024 and maintenance capital expenditure. Investing activities during the twelve months ended December 31, 2024 were attributable to the preparation for the opening of our 2024 de novo locations.
Material Cash Requirements The following table summarizes our material cash requirements as of December 31, 2024: Payments due by Period ($ in thousands) Total Less than 1 Year 1-3 Years 4-5 Years More than 5 Years Debt – principal and revolver (1) $ 75,750 $ 4,250 $ 71,500 $ — $ — Interest expense (2) 14,636 5,557 9,079 — — Operating lease agreements 43,933 7,409 19,936 7,993 8,595 Total $ 134,319 $ 17,216 $ 100,515 $ 7,993 $ 8,595 ___________ (1) Years 1-3 includes both the principal of the Term Loan as well as the revolving credit facility.
Material Cash Requirements The following table summarizes our material cash requirements as of December 31, 2025: Payments due by Period ($ in thousands) Total Less than 1 Year 1-3 Years 4-5 Years More than 5 Years Debt – principal and revolver (1) $ 56,957 $ 5,460 $ 51,497 $ — $ — Interest expense (2) 6,807 5,098 1,709 — — Operating lease agreements 34,116 6,959 16,192 7,578 3,387 Total $ 97,880 $ 17,517 $ 69,398 $ 7,578 $ 3,387 ___________ (1) This amount does not reflect any prepayments.
For the twelve months ended December 31, 2023, we paid cash dividends to stockholders of $0.4 million and made principal payments on our debt of $12.1 million. Net cash used in financing activities for the twelve months ended December 31, 2022 was $27.3 million.
Financing Activities Net cash used in financing activities during the twelve months ended December 31, 2025 was $0.5 million.
At December 31, 2024, we had working capital of $(11.5) million compared to $(4.4) million at December 31, 2023. For the twelve months ended December 31, 2023, our operating cash flow decreased by $0.5 million compared to the same period in 2022.
The decrease is primarily attributed to lower case volume offset by increased rate. Cost of Service— Our cost of service decreased $9.5 million, or 13.3%, compared to the twelve months ended December 31, 2024. The percentage decrease in cost of service is driven by the decrease in cases compared to the same period in 2024.
Removed
Our consolidated financial statements present the results of operations and financial position of the Company, its wholly-owned subsidiaries and each of the Professional Associations that we manage under the MSAs.
Added
We define same-center facilities and procedure rooms based on if a facility was owned or operated as of December 31, 2024. Beginning September 30, 2025, we have excluded the London facility from all periods presented due to the closure of the facility.
Removed
We expect our general and administrative expenses to increase over time due to the additional legal, accounting, insurance, investor relations and other costs that we will continue to incur as a public company. Interest Expense Interest expense, net consists primarily of interest costs on our outstanding borrowings under our debt.
Added
See Note 6 to the consolidated financial statements included in this Annual Report on Form 10-K for further discussion. (2) During the fiscal year ended 2025, the Company recorded a $4.5 million loss related to the impairment of a portion of the Salesforce implementation project and $0.1 million related to the corporate office PPE write-off.
Removed
This decrease is related to a decrease in our equity-based compensation expense (see Note 6 to the consolidated financial statements included in this Annual Report on Form 10-K for further discussion) partially offset by additional expenses we incurred for marketing and corporate support as we grow our center count through de novo expansion and providing support for our centers.
Added
See Note 1 to the consolidated financial statements included in this Annual Report on Form 10-K for further discussion. (3) During the fiscal year ended 2025, the Company recorded $2.2 million in costs related to the closure of the London facility.
Removed
We expect our marketing and corporate support costs to continue to increase on an absolute dollar basis as we open de novo centers. Selling, general and administrative expenses as a percent of revenue were 54.8% and 52.3% for the twelve months ended December 31, 2024 and 2023, respectively.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeAs of December 31, 2024, we had term loan borrowings of $70.8 million in principal amount under the Loan Agreement and $5.0 million drawn on the revolving credit facility.
Biggest changeAs of December 31, 2025, we had term loan borrowings of $57.0 million in principal amount under the Loan Agreement and $0.0 million drawn on the revolving credit facility.
Based on the amount outstanding, a 100 basis point increase or decrease in market interest rates over a twelve-month period would result in a change to interest expense of approximately $0.8 million. Inflation Risk Based on our analysis of the periods presented, we believe that inflation has not had a material effect on our operating results.
Based on the amount outstanding, a 100 basis point increase or decrease in market interest rates over a twelve-month period would result in a change to interest expense of approximately $0.6 million. Inflation Risk Based on our analysis of the periods presented, we believe that inflation has not had a material effect on our operating results.

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