Modular Medical (MODD) reported a continued pre-revenue profile in QQ3 2025, with the company incurring substantial R&D and operating expenses against no disclosed quarterly revenue. For the quarter, R&D and SG&A combined totaled $4.854 million, yielding an EBITDA of -$4.523 million and an operating income of -$4.854 million. Net income came in at -$4.804 million with basic/diluted EPS of -$0.13, reflecting ongoing development costs aligned with the company’s strategy to advance insulin pump technology toward commercialization. Notably, cash burn remained elevated, with operating cash flow of -$4.096 million and free cash flow of -$4.638 million, while financing activities provided a material cash inflow of $7.731 million, resulting in a net cash increase of $3.093 million and an ending cash balance of $6.986 million.
From a liquidity and balance-sheet perspective, Modular Medical remains structurally capital-light on leverage (current ratio 5.30; debt-to-equity near 0.09) with total assets of $12.15 million and net cash position aided by financing activity. The company carried no material long-term debt and a conservative liability base, which provides runway for continued R&D and regulatory activities as it pursues commercialization. However, the lack of revenue in QQ3 2025 underscores the development-stage risk: sustained negative earnings and the need for external funding to reach meaningful top-line and potential product milestones.
Compared with publicly available industry peers in the medical devices and digital health space that are also navigating pre-revenue or early-commercial phases, MODD’s gross margin in the prior year’s Q4 showed a meaningful margin when revenue was recognized (gross margin of 74.5% on $902k revenue), suggesting the potential for high gross margins once revenue scales amid fixed R&D costs. The near-term investment thesis rests on successful product development, regulatory progression, and potential partnerships or licensing that could unlock commercialization and reduce the reliance on frequent external financings. Investors should monitor regulatory milestones, clinical trial progress, manufacturing scalability, and any strategic financing events that could impact dilution and cap table dynamics.