INVO Fertility, Inc. SEC 10-K Report

INVO Fertility, Inc., a company specializing in fertility treatment solutions, has released its annual 10-K report, detailing significant financial growth, strategic business expansions, and the challenges it faces in the competitive fertility market. The report highlights the company's efforts to expand its clinic operations, increase the utilization of its proprietary INVOcell device, and manage its capital effectively to support future growth.

Financial Highlights

• Total Revenue: $6.5 million, increased by approximately 117% primarily due to the full year inclusion of Wisconsin Fertility Institute.
• Cost of Revenue: $3.7 million, increase primarily related to the full year inclusion of Wisconsin Fertility Institute.
• Loss from Operations: $(8.1) million, reflecting increased selling, general, and administrative expenses.
• Net Loss: $(9.1) million, compared to $(8.0) million in the previous year, with a significant portion related to non-cash expenses.
• Net Loss Per Common Share: $(30.19), compared to $(67.37) in the previous year, reflecting the impact of increased shares outstanding.

Business Highlights

• Fertility Clinics Expansion: INVO Fertility has focused on expanding its fertility clinic operations, including the acquisition of the Wisconsin Fertility Institute (WFI) in August 2023, which significantly increased the company's annual revenue and cash flow. The company plans to continue acquiring profitable IVF clinics and opening new INVO Centers to accelerate growth.
• INVOcell Device Utilization: The INVOcell device, which allows fertilization and early embryo development to occur in vivo, remains a key part of the company's strategy. The device is marketed as a more affordable and intimate alternative to traditional IVF, with comparable success rates.
• Joint Ventures: INVO Fertility has established joint ventures to open INVO Centers in Birmingham, Alabama, and Atlanta, Georgia, to increase the use of the INVOcell device and expand the availability of the IVC procedure.
• Operational Efficiency: The company emphasizes operational efficiency in its INVO Centers, which require less investment than traditional IVF clinics, making them suitable for underserved secondary markets.
• NAYA Therapeutics Divestiture: INVO Fertility acquired NAYA Therapeutics in October 2024 but decided to divest a majority interest in the company to refocus exclusively on the fertility market. INVO will retain a minority stake in NAYA Therapeutics.
• Future Outlook: INVO Fertility plans to continue expanding its fertility clinic operations and increase the distribution of the INVOcell device. The company aims to capitalize on the growing demand for ART services and address the imbalance between supply and demand in the fertility market.

Strategic Initiatives

• Strategic Initiatives: The company focused on expanding its presence in the fertility marketplace by acquiring the Wisconsin Fertility Institute, which significantly increased its annual revenue and cash flow. Additionally, the company acquired NAYA Therapeutics to diversify its business into oncology and autoimmune technology, although it later decided to divest a majority interest in NAYA to refocus on fertility services. The company also plans to open additional INVO Centers and acquire more IVF clinics to accelerate growth.
• Capital Management: The company raised approximately $9.5 million through a public offering in January 2025, which included the issuance of common stock and warrants. The proceeds were intended to fund the acquisition of WFI, redeem preferred stock, and address outstanding debt obligations. The company also executed a 1-for-12 reverse stock split in March 2025 to comply with Nasdaq's minimum bid price rule. Additionally, the company issued preferred stock and convertible notes as part of its capital management strategy.
• Future Outlook: The company plans to continue focusing on the fertility market by expanding its clinic operations and increasing the distribution of the INVOcell device. It aims to leverage the growing demand for ART services and address the market's supply-demand imbalance. The company also intends to monetize its minority stake in NAYA Therapeutics through potential value appreciation from its clinical developments. Furthermore, the company is exploring additional IVF clinic acquisitions and the opening of new INVO Centers to support its growth objectives.

Challenges and Risks

• Financial Risks: The company faces significant financial risks, including substantial indebtedness and doubts about its ability to continue as a going concern. The accumulated net loss of $67.2 million raises concerns about generating sufficient cash flow and obtaining additional financing. The company’s operations are highly leveraged, and failure to service its debt could lead to default and asset seizure by creditors.
• Integration Challenges: The acquisition of NAYA Therapeutics and Wisconsin Fertility Institute presents integration challenges, potential unanticipated liabilities, and the risk of not achieving expected benefits. The company is also negotiating payment terms for the acquisition of WFI, with potential adverse effects if terms are not resolved.
• Competitive and Regulatory Risks: The company’s fertility business is subject to intense competition, regulatory scrutiny, and the need for additional capital to grow. The FDA regulatory process for medical devices is complex and costly, with potential delays in obtaining necessary approvals. The company also faces risks related to healthcare fraud and abuse laws, which could result in significant penalties if violated.
• Market Risks: The company is exposed to foreign currency exchange rate fluctuations, which could impact international sales and financial results. Additionally, changes in healthcare industry regulations and economic conditions could affect the company’s market size and pricing strategies. The company is also susceptible to cybersecurity breaches, which could disrupt operations and compromise sensitive data.

SEC Filing: INVO Fertility, Inc. [ INVO ] - 10-K - Apr. 29, 2025