Highlights from TMDX ER conf call

This is not a comprehensive summary - I just picked out the things I thought were most significant.

2022 – Q4 – ER Conf Call Notes:

  • No surprises. Overall great results for Q4 with a conservative guide for 2023. The CEO said, “we are just at the beginning of a long runway for sustained growth”.

  • International sales are stagnant and not going anywhere right now.

  • The main reason for being conservative in 2023 is the ongoing supply constraint. Demand is so strong that TMDX cannot keep up production to meet the current demand. They are in the process of expanding production capacity, and they said they expect to have that extra capacity fully approved and online in the second half of 2023.

  • During the Q&A the CEO said that analysts should plan on Q1 and Q2 being flat with Q4 revenue due to the capacity constraint.

  • They recently hired a new Supply Chain VP to assist with production optimization.

  • Part of the lower gross margin in Q4 was due to the fact that they had to use private jets to ship around some of the OCS units when they had a need but lack of supply at a certain location.

  • They are continuing to expand medical staffing for NOP teams and they are considering adding additional launch points.

  • OCS was used for approximately 1000 cases in 2022 which was approximately 7% of the total transplants in the US for liver, lung, and heart combined. They expect the number of yearly transplants to increase now that OCS is making it possible to utilize more organs.

  • The CEO said that “stacking” at transplant centers is becoming more common at some of the locations where OCS has deeper penetration. I believe “stacking” refers to the practice of accepting more organs than they would normally accept and having TMDX manage the organs on the OCS for a longer amount of time so that the hospital can “stack” one transplant after another in sequence. In the past this was impossible because organs could not be kept healthy long enough to do this. This creates a new paradigm for hospitals.

  • The CEO was asked if TMDX thinks they have the ability to increase the price of the NOP service over time. The CEO did not directly answer the question, but said that they are currently not pricing the NOP to try to make money with it. They are pricing it to make it attractive to hospitals in order to be a catalyst for more sales of OCS units. (My 2 cents - I think they will have the opportunity to increase the price over time. I think they are pricing low now in order to gain market share and keep out competition. Once they own the market they can increase the price of this service.)

  • The CEO commented about the current transportation network and referred to it as a broken field. He said it is sometimes nothing more than a broker in the middle of the night calling different private jet services to try to arrange transportation - and the broker does not even own a single airplane of his own. TMDX sees this as another area of the overall organ delivery system that is ripe for disruption and that they can eventually fold into their own organization.

  • There was only one piece of information that I thought was really new that I had not heard of before. In the status quo, if an organ is available but the Organ Procurement Organization does not have a recipient immediately matched, the organ will not be collected and it often goes to waste. TMDX has done a few procedures in 2022 where they would collect the organ anyway even when there was not a definite recipient identified. Because the organ can be kept healthy longer, TMDX can do this to give the OPO more time to identify a recipient. This is just one additional use case that demonstrates the benefit and flexibility of using the OCS system to solve a problem that resulted in lots of wasted organs in the old method of cold storage. The CEO said they are just scratching the surface of this type of use.

Holding all shares. Looking forward to the next few years. TMDX is my largest stock position by 2x over any others.


Hey AnalogKid70 - thanks for this. Just as a suggestion, could you go back and edit the title and add TMDX or Transmedics into the title so that we can see when searching for this thread in the future.



Hi Ant - the title does have TMDX in it. Are you asking me to also add the full company name?

Different subject - one more thought on TMDX - I would not be surprised if they do another capital raise sometime this year. They are not in immediate need, but they could use a better cash buffer. I mentioned this before, but they really struggled during COVID and were forced into doing a horrible raise at the worst time because of it. Because of that experience, I expect them to raise again as soon as the opportunity is good to give more of a cash cushion for future growth. Not sure if it would impact the share price - the last raise did not seem to have much impact.


I thought it was an excellent quarter.

Remember that Q3 had $1.4m revenue adjustment. If we exclude that, then the sequential revenue growth was as follows:

Incr Rev Q1 Q2 Q3 Q4
2020 -4.1 3.7 0.5
2021 -0.5 1.1 -2.8 4.3
2022 6.2 4.6 3.8 7.1

Sequential growth excl the $1.4m adjustment to Q3 was 29% - and it was the biggest $ increase yet. Excluding that one-off also makes the guide tick up a little, to 50%-57%.

There were a lot of analyst questions trying to get more granularity on the guide, fishing for where they may “really” end next year. The CEO refused to get drawn in though, except for one comment, I think in the Q&A:

I said, we expect the incremental capacity to start coming online in the second half of the year. I wasn’t specific end of the first or end of the second. So that’s number one. Number two, right now, we are not providing granular information on revenue potential, because we are just trying to maximize the throughput and manage the existing event. So I will caution not to share anything at this point, because this is all going to change within the next few months here. Once the new clean room comes online, once Nick finished, bringing in the additional fire power that he needs to run this with a smooth process once he finished the layout and everything else, this could have significant efficiencies to increase the numbers, whatever number we think we have today.

Then on another point, they guided for opex growth of 25-30% in the Q&A. If you take the top end of that range and combine it with the rev increase guide, and assume 66% GM, then the operating loss will be $30.1m next year, down from $31.4m this year, and operating loss margin will improve from -33.6% this year to -20.7% next year. And these amounts include SBC. I would wager that a 13%pts operating margin improvement including SBC is the floor, and we could have even more operating leverage kick in next year.

Very happy with this one and to finally get a company reporting where they did not mention “the macro” once.



“Very happy with this one and to finally get a company reporting where they did not mention “the macro” once.”

Agree. High inflation or low inflation, high rates or low rates, people are going to need transplants - and insurance companies are going to continue to pay for them and pay for OCS. The American population is not on a great health trend and I expect the need for transplants to only increase. Complications from COVID/Vaccines could increase the need even more.