npce-20250630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2025


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For transition period from to

Commission File Number 001-40337

NEUROPACE, INC.

(Exact name of registrant as specified in its charter)


Delaware						22-3550230
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification Number)

455 N. Bernardo Avenue

Mountain View, CA 94043

(650) 237-2700

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol

Name of each exchange on which registered

Common Stock, $0.001 par value per share

NPCE

The Nasdaq Stock Market LLC

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act): Yes ☐ No ☒

As of August 8, 2025, there were approximately 33,081,498 shares of the registrant's common stock outstanding.

TABLE OF CONTENTS


		Page
Part I. Financial Information
Item 1.	Financial Statements (Unaudited)	1
	Condensed Balance Sheets	1
	Condensed Statements of Operations and Comprehensive Loss	2
	Condensed Statements of Stockholders' Equity	3
	Condensed Statements of Cash Flows	5
	Notes to Unaudited Interim Condensed Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	34
Item 4.	Controls and Procedures	35
Part II. Other Information
Item 1.	Legal Proceedings	36
Item 1A.	Risk Factors	37
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	92
Item 3.	Defaults Upon Senior Securities	93
Item 4.	Mine Safety Disclosures	94
Item 5.	Other Information	94
Item 6.	Exhibits	95
Signatures

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements about us and our industry that involve substantial risks and uncertainties. All statements regarding results or events that may occur in the future contained in this Quarterly Report on Form 10-Q, including statements regarding our future results of operations and financial condition, as well as expectations of management for future operations, are forward-looking statements. In some cases, you can identify forward-looking statements because they contain words such as “anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” or “would,” or the negative of these words or other similar terms or expressions.

We have based these forward-looking statements largely on our current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. These forward-looking statements are subject to a number of risks, uncertainties, factors and assumptions more thoroughly described in “Risk Factors.” These risks are not exhaustive. Other sections of this Quarterly Report on Form 10-Q, as well as our other disclosures and filings, include additional factors that could harm our business and financial performance. Moreover, we operate in a very competitive and rapidly changing environment. New risk factors emerge from time to time, and it is not possible for our management to predict all risk factors nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ from those contained in, or implied by, any forward-looking statements.

You should not rely on these forward-looking statements as predictions of future events. We cannot assure you that the events and circumstances reflected in the forward-looking statements will be achieved or occur. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, or achievements. Except as required by law, we undertake no obligation to update publicly any forward-looking statements for any reason after the date of this Quarterly Report on Form 10-Q or to conform these statements to actual results or to changes in our expectations, whether as a result of any new information, future events, changed circumstances or otherwise. Forward-looking statements contained in this Quarterly Report on Form 10-Q include, but are not limited to, statements about:

•our expected future growth;

•the size and growth potential of the markets for our products, and our ability to serve those markets;

•our ability to accurately forecast demand for our products;

•the rate and degree of market acceptance of our products;

•coverage and reimbursement for procedures performed using our products, including pre-implant evaluations, implant procedures, and follow-up care;

•the performance of third parties in connection with the manufacturing and development of our products, including single-source suppliers;

•regulatory developments in the United States and in any foreign countries in which we may seek to do business;

•our use of cash resources and our ability to achieve cash flow breakeven without revenues from the DIXI Medical distribution agreement after its planned expiration;

•our expected long-range revenue growth without revenues from the DIXI Medical distribution agreement after its planned expiration;

•our ability to retain regulatory approval for our products or obtain regulatory approval for updates to our products, or new products or indications in the United States and in any foreign countries in which we may seek to do business;

•our research and development for existing products and new products, including our conduct of ongoing and future clinical trials for our existing products;

•our expectations with respect to our existing products and their ability to be used without modification in pediatric patients and in those with generalized epilepsy;

•our reliance on third-party suppliers for product components, some of which are single source suppliers;

•our ability to manufacture our products in conformity with FDA requirements and with regulatory requirements of any foreign countries in which we may seek to do business;

•our ability to predict product performance, including battery life of our RNS device;

•our expectations regarding the impact that our sales and marketing initiatives will have on our sales;

•our ability to retain or scale our organizational culture;

•the development, regulatory approval, efficacy and commercialization of competing products;

•our ability to attract and retain members of our board of directors, senior management, or operational personnel;

•our expectations regarding the period during which we will qualify as an emerging growth company under the JOBS Act and as a smaller reporting company under the federal securities laws;

•our ability to develop and maintain our corporate infrastructure, including our ability to maintain an effective system of internal control;

•our expectations regarding the impact of public health crises and geopolitical tensions, such as the Russia-Ukraine war and ongoing conflicts in the Middle East, on our business, our industry and the economy;

•the impact of adverse economic conditions, including as a result of unfavorable global economic and political conditions, increased interest rates and inflation;

•our financial performance and capital requirements; and

•our expectations regarding our ability to obtain, maintain and enforce intellectual property protection for our products and technology, as well as our ability to operate our business without infringing, misappropriating or otherwise violating the intellectual property rights of others.

You should read this Quarterly Report on Form 10-Q as well as the documents that we reference in, and have filed as exhibits to, this report with the understanding that our actual future results, levels of activity, performance and achievements may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements.

In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based on information available to us as of the date of this Quarterly Report on Form 10-Q. While we believe that such information provides a reasonable basis for these statements, that information may be limited or incomplete. Our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all relevant information. These statements are inherently uncertain, and investors are cautioned not to unduly rely on them.

PART I. FINANCIAL INFORMATION

Item 1. Unaudited Financial Statements

NeuroPace, Inc.

Condensed Balance Sheets

(unaudited)


	June 30,		December 31,
(in thousands, except share and per share amounts)	2025		2024
Assets
Current assets
Cash and cash equivalents	$	22,857	$	13,430
Short-term investments	39,284		39,325
Accounts receivable	13,554		12,851
Inventory	16,346		13,381
Prepaid expenses and other current assets	1,701		2,352
Total current assets	93,742		81,339
Property and equipment, net	1,156		1,052
Operating lease right-of-use asset	11,007		11,843
Restricted cash	122		122
Deferred offering costs	—		276
Other assets	87		15
Total assets	$	106,114	$	94,647
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable	$	4,721	$	2,954
Accrued liabilities	9,740		9,787
Operating lease liability	1,986		1,860
Deferred revenue	696		555
Total current liabilities	17,143		15,156
Long-term debt	58,616		59,525
Operating lease liability, net of current portion	10,917		11,953
Total liabilities	86,676		86,634
Commitments and contingencies (Note 5)
Stockholders’ equity
Preferred stock, $0.001 par value, 10,000,000 shares authorized and no shares issued and outstanding as of June 30, 2025 and December 31, 2024	—		—
Common stock, $0.001 par value, 200,000,000 shares authorized as of June 30, 2025 and December 31, 2024; 33,044,371 and 30,145,039 shares issued and outstanding as of June 30, 2025 and December 31, 2024, respectively	33		30
Additional paid-in capital	565,595		538,933
Accumulated deficit	(546,190)		(530,950)
Total stockholders’ equity	19,438		8,013
Total liabilities and stockholders’ equity	$	106,114	$	94,647

The accompanying notes are an integral part of these unaudited interim condensed financial statements.

NeuroPace, Inc.

Condensed Statements of Operations and Comprehensive Loss

(unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
(in thousands, except share and per share amounts)	2025		2024		2025		2024
Revenue	$	23,520	$	19,256	$	46,044	$	37,380
Cost of goods sold	5,388		5,122		10,570		9,903
Gross profit	18,132		14,134		35,474		27,477
Operating expenses
Sales and marketing	12,043		9,756		23,046		19,789
Research and development	6,845		6,065		14,285		11,849
General and administrative	6,068		4,543		10,114		9,614
Total operating expenses	24,956		20,364		47,445		41,252
Loss from operations	(6,824)		(6,230)		(11,971)		(13,775)
Interest income	718		762		1,511		1,589
Interest expense	(2,059)		(2,166)		(4,212)		(4,424)
Other income (expense), net	(486)		120		(568)		171
Net loss and comprehensive loss	$	(8,651)	$	(7,514)	$	(15,240)	$	(16,439)
Net loss per share attributable to common stockholders, basic and diluted	$	(0.26)	$	(0.26)	$	(0.47)	$	(0.58)
Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted	32,863,031		28,853,216		32,175,789		28,569,196

The accompanying notes are an integral part of these unaudited interim condensed financial statements.

NeuroPace, Inc.

Condensed Statements of Stockholders’ Equity

(unaudited)


	Common Stock			Additional Paid-In Capital		Accumulated Deficit		Total Stockholders’ Equity
(in thousands, except share amounts)	Shares	Amount
Balances as of January 1, 2025	30,145,039	$	30	$	538,933	$	(530,950)	$	8,013
Net loss	—	—		—		(6,589)		(6,589)
Issuance of ordinary shares in follow-on offering, net of underwriting discounts and commissions and offering expenses of $5,365	7,475,000	7		69,377		—		69,384
Repurchase of common stock from KCK Ltd.	(5,270,845)	(5)		(49,541)		—		(49,546)
Issuance of common stock as part of At-the-Market offering, net of sales commission and offering expenses of $15	18,590	—		224		—		224
Issuance of common stock pursuant to stock option exercises	101,301	1		384		—		385
Issuance of common stock upon vesting of restricted stock units	299,535	—		—		—		—
Shares withheld for taxes	(17,380)	—		(228)		—		(228)
Stock-based compensation	—	—		2,626		—		2,626
Balances as of March 31, 2025	32,751,240	33		561,775		(537,539)		24,269
Net loss	—	—		—		(8,651)		(8,651)
Issuance of common stock pursuant to stock option exercises	21,671	—		146		—		146
Issuance of common stock pursuant to Employee Stock Purchase Plan	66,627	—		620		—

SEC Form 10-Q filed by Neuropace Inc.