biote Corp.

Biote Corp. operates as a high-growth practice-building business within the hormone optimization sector, providing a comprehensive, end-to-end platform for Biote-certified practitioners. The company's business model, which it believes has been successful for the past 14 years, is similar to a franchise model, enabling practitioners to establish and implement a program for optimizing hormone levels using personalized solutions for their patients. The total U.S. market opportunity for Hormone Replacement Therapy (HRT) products was estimated to exceed $7 billion ⁴ as of 2020 and is projected to grow 7% ⁵ annually through 2026. This growth is driven by aging demographics and increasing consumer demand for medical information and treatment options for hormonal imbalances.

The company's core business model generates revenue through fees charged to Biote-partnered clinics for the Biote Method and from the sale of Biote-branded dietary supplements. The Biote Method platform includes education, training, and certification, practice management software, inventory management software, information on available HRT products, and digital and point-of-care marketing support. Revenue from long-term service agreements and sales of Biote-branded dietary supplements constitutes substantially all of the company's revenue. Approximately 71% ⁶ of the company's revenue during the year ended December 31, 2025, was derived from service fees associated with the comprehensive platform and support provided to Biote-partnered clinics, realized when Biote-certified practitioners perform HRT procedures utilizing pellets dispensed in office.

The company's product offerings include bioidentical hormone pellets, which are part of the procedure-based revenue model, and an expanding line of private-labeled Biote-branded dietary supplements. The Biote Method is designed to enable practitioners to treat hormone imbalances using bioidentical estrogen and testosterone products. A majority of the bioidentical compounded hormone pellets used by Biote-certified practitioners are manufactured by Biote's 503B outsourcing facility, Asteria Health, and also sourced from third-party FDA-registered 503B outsourcing facilities like AnazaoHealth Corporation and Right Value Drug Stores, LLC d/b/a Carie Boyd's Prescription Shop. Biote does not receive compensation for the sale of bioidentical pellets from these third-party outsourcing facilities to Biote-certified practitioners.

The Biote-branded dietary supplements segment accounted for approximately 22% ⁷ of the company's annual revenues in 2025. This line, introduced in 2013 with two products, DIM SGS+ and ADK 5, has grown to include 26 ⁸ dietary supplements, priced between $10.00 ⁹ and $126.50 ¹⁰. These supplements are primarily sold wholesale directly to over 3,500 ¹¹ Biote-certified practitioners through the company's eCommerce site, with approximately 70% ¹² of Biote-branded dietary supplements sold through Biote-certified practitioners as of December 31, 2025. Approximately 65% ¹³ of partnered clinics offer these supplements, with an average supplement volume per practice of approximately $7,900 ¹⁴ as of 2025. The company also offers two sterile pellet insertion kits to practitioners.

For the fiscal year ended December 31, 2025, total revenue decreased by $5.0 million ¹⁵ to $192.2 million ¹⁶, a 2.5% ¹⁷ decline compared to $197.2 million ¹⁸ in 2024. This was primarily due to a $13.3 million ¹⁹ decrease in procedure revenue, attributed to a slowdown in new clinic additions and a decline in procedure volume from existing Biote-certified practitioners. This was partially offset by a $6.9 million ²⁰ increase in Biote-branded dietary supplement revenue, a $1.1 million ²¹ increase from disposable trocars and bioidentical hormone pellets manufactured by Biote's 503B compounding facility and sold to third parties, and a $0.3 million ²² increase in service revenue. Gross profit is not explicitly stated, but cost of revenue decreased by $3.3 million ²³ to $54.9 million ²⁴, a 5.6% ²⁵ decrease from $58.1 million ²⁶ in 2024. Selling, general and administrative expenses decreased by $5.6 million ²⁷ to $101.8 million ²⁸, a 5.2% ²⁹ decrease from $107.5 million ³⁰ in 2024. Income from operations increased to $35.6 million ³¹ in 2025 from $31.6 million ³² in 2024. Net income for 2025 was $31.6 million ³³, a significant increase from $0.05 million ³⁴ in 2024. Diluted EPS was $0.74 ³⁵ in 2025, compared to $0.09 ³⁶ in 2024. Cash and cash equivalents were $24.1 million ³⁷ as of December 31, 2025, down from $39.3 million ³⁸ in 2024. Total debt, including current and non-current portions of the term loan and revolving loans, was $107.0 million ³⁹ in 2025, compared to $107.4 million ⁴⁰ in 2024.

Year-over-year, total revenue decreased by 2.5% ¹⁷, primarily driven by a $13.3 million ¹⁹ decline in procedure revenue, partially offset by a $6.9 million ²⁰ increase in Biote-branded dietary supplement revenue. Cost of revenue decreased by 5.6% ²⁵, with cost of pellet procedures decreasing 19.0% ⁴¹ relative to an 8.8% ⁴² decrease in procedure revenue, reflecting cost savings from the vertical integration of Asteria Health. Selling, general and administrative expenses decreased by 5.2% ²⁹, mainly due to a $4.9 million ⁴³ reduction in legal settlement expenses from 2024 that did not reoccur in 2025, and a $2.4 million ⁴⁴ decrease in other legal expenses. These reductions were partially offset by a $2.2 million ⁴⁵ increase in marketing-related expenses. Net income saw a substantial increase from $0.05 million ³⁴ in 2024 to $31.6 million ³³ in 2025, largely due to a $13.0 million ⁴⁶ gain from the change in fair value of earnout liabilities in 2025, compared to a $19.6 million ⁴⁷ loss in 2024.

During the fiscal year, Biote Corp. made several significant operational developments. On March 18, 2024, the company acquired Asteria Health, a privately held 503B outsourcing facility, for a total consideration of $9.0 million ⁴⁸, consisting of $8.5 million ⁴⁹ in cash and an additional $0.5 million ⁵⁰ cash earnout payment. On January 29, 2024, Biote acquired certain assets from BioSana ID LLC for $0.7 million ⁵¹ in cash. On January 2, 2024, the company acquired intellectual property and rights from Simpatra, LLC for $1.5 million ⁵² in cash and 389,105 ⁵³ shares of Class A common stock, with a future earnout payment of 194,553 ⁵⁴ shares contingent on financial targets. In May 2025, the company underwent an organizational restructuring of its commercial teams, resulting in a reduction of 16 ⁵⁵ employees. On November 3, 2025, the company executed an amendment to a settlement agreement with Gary S. Donovitz, agreeing to repurchase the remaining 6.1 million ⁵⁶ shares of his Class V voting stock for a lump sum payment of $18.5 million ⁵⁷.

Management's specific guidance for the upcoming period is not explicitly provided in the filing. However, the company's corporate growth strategy outlines several key areas of focus for future expansion.

The company plans to accelerate its U.S. geographic expansion over the next three years to grow its practice-building business in the hormone optimization market. In 2026, the company intends to expand its commercial sales team, add new geographies, and increase its training capacity to accommodate a higher rate of new Biote-partnered clinics. The company uses demographic and practitioner-level data, such as prescription patterns and purchasing data, to identify new growth opportunities efficiently.

Another major growth vector is the international scale-up of its practice-building platform. The company believes there is an opportunity to grow in a core group of Latin American countries, in Europe, and potentially in Asia, which some market analysts project to be the fastest-growing market globally, with 57% ⁵⁸ of the current global market for hormone products existing outside of North America as of April 2021. However, the company recognizes the challenges and risks of simultaneous expansion in multiple geographies and believes international expansion may require a different access model, such as a license model utilizing local distributors. The U.S. growth strategy is the primary focus before launching international expansion. The company currently has a presence in Puerto Rico, Mexico, and the Dominican Republic.

The company is committed to advancing healthcare through product improvement and constantly evaluates the potential for advanced education and tools to support the hormone optimization market. The Biote-branded dietary supplement business has grown at a 9.5% ⁵⁹ compound annual growth rate between 2019 and 2025. The company sees an important growth opportunity to expand its Biote-branded dietary supplement portfolio through new product launches and increased education of Biote-certified practitioners on these products.

Operationally, the company's supply chain management aims for capital efficiency and underpins practitioner confidence. While all dietary supplement products are currently single-source manufactured, the company regularly evaluates this from a risk management perspective and expects to add second-source dietary supplement suppliers in 2026 ⁶⁰ to manage supply chain interruption risks and reduce costs. The company is also planning for necessary changes to its 3PL structure, including adding one or more shipping locations, to manage the anticipated shift towards a greater volume of more frequent, smaller direct-to-patient dietary supplement orders as its business scales.

The company plans to continue to evaluate selective business development opportunities, such as strategic acquisitions, while simultaneously strategizing on moves that could benefit its model and stockholders. The company's liquidity is primarily derived from available cash and cash equivalents, cash generated from operations, and capacity under its revolving loans. For at least the next 12 months, the company believes its current cash position, anticipated cash from operations, and revolving loan capacity are sufficient to fund operations and debt service obligations. As of December 31, 2025, the company had $45.0 million ⁶¹ of revolving loans available under its Truist credit agreement. The company expects its operating and capital expenditures to increase as it increases headcount, expands operations, and grows its clinic base.

The company has flagged several structural headwinds and execution risks. Its success depends on the Biote Method and Biote-branded dietary supplements attaining significant market acceptance, and failure to achieve this could materially impact the business. Reliance on third-party outsourcing facilities and dietary supplement contract manufacturers for compliance and supply poses risks, as does the concentration of Biote-certified practitioners in certain geographic regions. The frequency of use of the Biote Method by practitioners may not increase as anticipated, and inadequate practitioner training could lead to negative patient outcomes. The company believes its long-term value is greater if it focuses on growth, which may negatively impact near-term results of operations. Significant competition in the hormone replacement therapy and dietary supplement markets could hinder market penetration and share. International expansion efforts are subject to regulatory, economic, and political risks different from those in the U.S.

The company faces material risks across several categories. Macroeconomic risks include concerns over inflation, energy costs, geopolitical issues such as the ongoing conflicts between Russia and Ukraine and in the Middle East, and unstable global credit markets, which could lead to economic instability, diminished liquidity, and reduced consumer confidence. For instance, the U.S. Consumer Price Index rose 2.7% ⁶² from the same month a year ago as of December 31, 2025. Adverse developments in the financial services industry, such as bank failures, could threaten the company's access to its cash, as deposits exceeding the FDIC insured limit of $250,000 ⁶³ are held in certain financial institutions. Operationally, the company's success depends on the market acceptance of the Biote Method and its dietary supplements, and failure to achieve this could materially harm the business. Reliance on third-party outsourcing facilities and dietary supplement contract manufacturers for compliance and supply, including the potential for product recalls such as the voluntary recall of specific lots of hormone pellets by Asteria Health between May 20, 2025, and January 20, 2026 ⁶⁴ due to potential metal particulate matter, poses significant liabilities and reputational harm. Geographic concentration of Biote-certified practitioners, with approximately 53% ⁶⁵ of 2025 revenue generated in ten core states, makes the company sensitive to regional regulatory, economic, environmental, and competitive conditions. Regulatory risks are substantial, as the healthcare industry is highly regulated by federal, state, and local laws, including those governing dietary supplements, compounded drugs, medical devices, advertising, corporate practice of medicine, and fee splitting. Non-compliance with FDA or FTC requirements could lead to significant penalties. The FDA's potential implementation of NASEM recommendations for compounded bioidentical hormones could substantially affect the ability of outsourcing facilities to compound pellets, negatively impacting revenue. Data privacy and security laws, such as HIPAA and state-specific regulations, expose the company to risks of regulatory investigations, litigation, fines, and reputational harm if information systems or data are compromised. The company also faces the risk of product liability lawsuits if its recommended products cause injuries, and while it maintains insurance, coverage may not be adequate.

Management's message to shareholders emphasizes a focus on long-term growth over short-term profitability, acknowledging that this strategy may negatively impact near-term results. The company's strategic priorities include increasing the number of Biote-certified practitioners through referrals, a dedicated sales force, and digital marketing; growing the practices of existing Biote-certified practitioners and partnered clinics by providing mentorship, practice management, marketing support, and high-quality dietary supplements; and increasing sales of Biote-branded dietary supplements through e-commerce platforms and practitioner recommendations. The company's Chief Executive Officer, Bret Christensen, was appointed on February 1, 2025 ⁶⁶, succeeding Teresa S. Weber, who transitioned to a strategic advisor role for up to one year. Management has acknowledged a material weakness in internal control over financial reporting as of December 31, 2025 ⁶⁷, primarily due to an insufficient complement of qualified technical accounting and financial reporting personnel and control issues related to information technology general controls. Remediation efforts are ongoing, including hiring additional personnel, implementing enhanced procedures and controls, and engaging third-party consultants. The company believes its current cash position, anticipated cash from operations, and revolving loan capacity of $45.0 million ⁶¹ are sufficient to fund operations and debt service obligations for at least the next 12 months.