Regulatory Delays Will Hinder Revenue Ramp But Allow Recovery

Key Takeaways

• Regulatory, reimbursement, and administrative hurdles in the U.S. could restrict revenue growth, delay account expansion, and compress margins despite strong market demand.
  
• Innovation pressures, rising R&D costs, and increased competition threaten long-term profitability, market share, and Genio's premium product positioning.
  
• Persistent operating losses, challenging U.S. reimbursement, clinical and IP hurdles, and execution risks threaten growth, margins, and shareholder returns in the medium term.

Catalysts

A medical technology company, develops and commercializes solutions to treat obstructive sleep apnea (OSA).

• Although Nyxoah benefits from a rapidly aging global population and increasing diagnosis rates of sleep apnea, the company faces lengthy and sometimes unpredictable value analysis committee and pre-authorization processes at U.S. implanting centers, which could significantly delay initial account openings and slow revenue ramp in the world's largest market.
  
• While rising healthcare provider and patient preference for minimally invasive, patient-friendly OSA treatments positions Genio favorably versus CPAP and legacy competitors, persistent regulatory and payer scrutiny could result in slower-than-expected coverage decisions and challenges achieving widespread reimbursement, therefore constraining revenue growth and compressing near-term net margins.
  
• Despite Genio's differentiated labeling and technology-particularly around bilateral stimulation and the lack of a CCC contraindication-there is a risk that the company fails to demonstrate clinically meaningful superiority in long-term U.S. studies versus established alternatives, potentially resulting in downward pricing pressure and limiting anticipated earnings growth from premium positioning.
  
• Although digital health adoption and real-world data collection are expected to facilitate treatment optimization and support broader use cases, accelerating R&D spend and required investments to keep pace with rapid innovation and evolving cybersecurity standards may pressure cash flows and further delay positive earnings, particularly in the face of ongoing operating losses and potential IP litigation costs.
  
• While the prevalence of obesity and the ability of GLP-1 drugs to expand the eligible patient pool for Genio offers structural market tailwinds, intensifying competition from both established medtech firms and emerging therapies could erode Nyxoah's market share and gross margins, ultimately limiting the scale and sustainability of future revenue and earnings growth.

Nyxoah Future Earnings and Revenue Growth

Assumptions

• This narrative explores a more pessimistic perspective on Nyxoah compared to the consensus, based on a Fair Value that aligns with the bearish cohort of analysts.
• The bearish analysts are assuming Nyxoah's revenue will grow by 156.3% annually over the next 3 years.
• The bearish analysts are not forecasting that Nyxoah will become profitable in next 3 years. To represent the Analyst Price Target as a Future PE Valuation we will estimate Nyxoah's profit margin will increase from -1564.9% to the average BE Medical Equipment industry of 4.0% in 3 years.
• If Nyxoah's profit margin were to converge on the industry average, you could expect earnings to reach €3.4 million (and earnings per share of €0.07) by about August 2028, up from €-77.2 million today. The analysts are largely in agreement about this estimate.
• In order for the above numbers to justify the price target of the more bearish analyst cohort, the company would need to trade at a PE ratio of 98.4x on those 2028 earnings, up from -2.6x today. This future PE is greater than the current PE for the BE Medical Equipment industry at 38.7x.
• Analysts expect the number of shares outstanding to grow by 7.0% per year for the next 3 years.
• To value all of this in today's terms, we will use a discount rate of 6.98%, as per the Simply Wall St company report.

Nyxoah Future Earnings Per Share Growth

Risks

• Nyxoah's ongoing operating losses, which increased to 19.9 million euros in the latest quarter compared to 13.3 million euros a year prior, along with a significant ramp in SG&A expected to nearly double in 2026, suggest persistent negative free cash flow and an ongoing need to raise capital that could dilute shareholders and weaken future earnings per share.
  
• The lengthy and uncertain reimbursement process in the U.S., with coverage decisions for major payors anticipated to extend into 2026, presents ongoing risk to near-term and medium-term revenues as limited coverage or slow uptake could constrain initial sales growth and margin expansion.
  
• Nyxoah's dependence on clinical validation for the CCC (complete concentric collapse) patient population-where U.S. label inclusion is only possible in late 2026 or early 2027 and data are still pending-limits its ability to address the full market and may result in slower adoption or disadvantage versus competitors, negatively impacting future revenue growth.
  
• The current patent litigation initiated by Inspire Medical against Nyxoah and the risk of future intellectual property disputes may lead to significant legal expenses or unfavorable outcomes that could erode net margins or disrupt U.S. commercialization.
  
• A concentrated go-to-market strategy focused on high-volume U.S. implanting centers requires rapid scaling and territory expansion, but faces execution risk in physician training, account openings, and competitive positioning against established players, which could impede revenue ramp and hinder operating leverage over the coming years.

Valuation

• The assumed bearish price target for Nyxoah is €6.0, which represents the lowest price target estimate amongst analysts. This valuation is based on what can be assumed as the expectations of Nyxoah's future earnings growth, profit margins and other risk factors from analysts on the more bearish end of the spectrum.
  
• However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of €18.6, and the most bearish reporting a price target of just €6.0.
  
• In order for you to agree with the bearish analysts, you'd need to believe that by 2028, revenues will be €83.0 million, earnings will come to €3.4 million, and it would be trading on a PE ratio of 98.4x, assuming you use a discount rate of 7.0%.
  
• Given the current share price of €5.28, the bearish analyst price target of €6.0 is 12.0% higher.
  
• We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.