Lifeward (NASDAQ:LFWD) said its first quarter of 2026 was shaped by a major strategic transaction, lower AlterG shipments tied to supply chain and working capital timing, and continued growth in its ReWalk personal exoskeleton business.
President and CEO Mark Grant said the quarter represented “an important strategic milestone” following the company’s acquisition of Oratech, a transaction he described as strengthening Lifeward’s position as a diversified biomedical innovation company while maintaining its focus on neurorehabilitation and profitability.
“That means Lifeward and our shareholders, by owning the protein oral delivery platform outright, effectively receive a meaningful option on the potential success of the promising technology with minimal near-term operational burden,” Grant said.
Revenue Declines on AlterG Shipment Timing
Revenue for the first quarter ended March 31, 2026, was $3.9 million, compared with $5 million in the first quarter of 2025. The company said the year-over-year decline was primarily driven by lower AlterG shipments, which were affected by temporary sourcing and supply chain constraints tied to working capital limitations during the final stages of Lifeward’s manufacturing transition.
Grant said the company has secured AlterG orders in backlog and expects shipment execution to improve during the second and third quarters as it works through those orders.
During the question-and-answer session, Yale Jen of Laidlaw & Company asked whether AlterG shipments could return to levels similar to last year in the second and third quarters. Grant said that was “a fair assumption” and said the recovery would likely “bridge across the second and third quarter.”
Grant also said the company still expects 2026 revenue to be similar to 2025 revenue, despite the lower first-quarter result. He pointed to the company’s manufacturing move from Fremont, California, to Massachusetts, a separate facility move within Massachusetts, and the start-up of a contract manufacturer as factors that created timing issues when combined with cash constraints.
“I would expect that we have similar to last year, and I would also expect the exit trajectory to be better than it is an entry trajectory,” Grant said.
ReWalk Sales Rise as Reimbursement Expands
While total revenue declined, Lifeward reported growth in its ReWalk personal exoskeleton business. ReWalk personal exoskeleton revenue rose 11% year over year to $1.6 million, reflecting progress in reimbursement coverage, channel expansion and international sales.
The company said ReWalk revenue in Germany increased nearly 25% year over year during the quarter. Management also highlighted broader reimbursement access for ReWalk, including through Medicare Advantage insurers such as Aetna, Humana and UnitedHealthcare.
Grant said Lifeward has been working to improve its approach to payers after historically focusing heavily on innovation. He said the company has made progress over the past several years in gaining Medicare coding, pricing and coverage, and is now working to expand payer placement with private insurers.
“Since you now you’ve seen Aetna, United, and Humana come on board, and our pipeline continues to grow,” Grant said. “We need to push further into the private payers into the market, the Blues of the world, if you will.”
Margins Pressured by Tariffs, FX and Lower Production
Gross margin in the quarter was 34.2%, compared with 42.2% in the prior-year quarter. The company attributed the decline to lower manufacturing absorption from reduced production volumes, higher freight and tariff expenses, and unfavorable foreign currency movements.
In response to a question from Ramakanth Swayampakula of H.C. Wainwright, CFO Almog Adar said foreign exchange fluctuations and tariffs accounted for roughly 75% to 85% of the gross margin gap compared with the prior-year quarter. The remaining impact was mainly tied to manufacturing absorption related to reduced production.
Total operating expenses were $11.7 million, rising primarily because of a one-time, non-cash research and development expense of about $4.9 million related to acquired intellectual property assets from the Oratech transaction.
On a non-GAAP basis, adjusted operating expenses declined 12% to $5.9 million from $6.8 million in the first quarter of 2025. The reduction was driven by improved sales and marketing productivity, lower reimbursement-related costs and reduced R&D spending after completion of several major development programs.
GAAP operating loss widened to $10.3 million, primarily because of the Oratech-related one-time expense. Adjusted operating loss was unchanged year over year at $4.6 million despite the lower revenue, which management said reflected the benefits of cost optimization initiatives.
Cash Position Strengthens After Financing and Acquisition
Cash used in operating activities fell 33% to $3.7 million compared with the first quarter of 2025. Lifeward ended the quarter with $11.4 million in unrestricted cash and cash equivalents, up from $2.2 million at the end of 2025.
The increase reflected the closing of the company’s strategic transaction, including $10 million in convertible note financing and approximately $6.5 million of cash associated with the Oratech acquisition.
Grant said the financing strengthened the company’s balance sheet and improved operating flexibility, allowing Lifeward to continue focusing on efficiency, market access and innovation across its neurorehabilitation platform.
Upper Body Exoskeleton Added to Portfolio
Lifeward also acquired an upper body exoskeleton technology during the quarter. Grant said the product is intended to address an unmet need among approximately 4.6 million stroke survivors and is complementary to the ReWalk platform. Development work is underway as the company works toward commercial launch.
Grant said Lifeward plans to rely heavily on channel partners to reach patients and support commercialization across its portfolio, rather than seeking patients individually. He cited partners such as Verita Neuro and CorLife as examples of the company’s strategy to work with organizations that already have access to relevant patient populations.
“We believe that Lifeward is entering into a new phase as more diversified biomedical innovation company with improving financial flexibility and a clear path for profitability,” Grant said in closing remarks.
About Lifeward (NASDAQ:LFWD)
ReWalk Robotics Ltd., a medical device company, designs, develops, and commercializes technologies that enable mobility and wellness in rehabilitation and daily life for individuals with physical and neurological conditions in the United States, Europe, the Asia-Pacific, and internationally. It offers ReWalk personal exoskeleton and rehabilitation exoskeleton devices; ReStore, a soft exo-suit intended for use in the rehabilitation of individuals with lower limb disability due to stroke; AlterG Anti-Gravity System for use in physical and neurological rehabilitation and athletic training; MyoCycle devices; and ReBoot, a personal soft exo-suit for home and community use by individuals post-stroke.
