The AVITA Medical Inc (ASX: AVH) share price is up 16% after the ASX healthcare stock gave its June 2026 update.
AVITA Medical says it’s a therapeutic acute wound care company that it will optimise wound healing, effectively accelerating the time to patient recovery.
Its RECELL platform is approved by the FDA f0r the treatment of thermal burn and trauma wounds. In the US, it holds the exclusive rights to market, sell and distribute Cohealyx – a branded collagen-based dermal matrix, and the exclusive rights to manufacture, market, sell and distribute PermeaDerm, a biosynthetic wound matrix.
Strong 2026 second quarter
The company revealed to the ASX in an announcement that its 2026 second quarter net revenue grew 18% year on year to $21.7 million. This also represented 13% growth quarter on quarter.
AVITA Medical revealed that revenue growth was driven by continued execution across its key commercial portfolio, led by RECELL and supported by increasing adoption of Cohealyx and PermeaDerm, complemented by consistent international revenue.
RECELL quarterly revenue grew 11% quarter on quarter to $18.5 million. Cohealyx quarterly revenue grew 16% quarter on quarter to $1.7 million. PermeaDerm revenue grew 16% quarter on quarter to $1.7 million. International revenue grew 26% quarter on quarter to $0.9 million.
Pleasingly, the company reported a gross profit margin of 81.9%, an increase of 70 basis points (0.70%) year on year, reflecting the growth of RECELL alongside the expansion of the company’s other product portfolio.
The company also noted that operating expenses were down 6% year on year to $24.6 million. It said this demonstrated continued operating discipline, while supporting commercial growth.
It said its ‘net cash used’ improved to approximately $3.2 million, compared to $9.9 million in the first quarter of 2026. At the end of the quarter, it had approximately $11.1 million of cash and securities.
Outlook for the AVITA Medical share price
The company has raised its annual 2026 net revenue guidance range to between $86 million to $89 million, “reflecting confidence in continued commercial execution”. That’s compared to the previous guidance of between $80 million to $85 million. It made $71.6 million of revenue in 2025, representing year on year growth of 20% to 24%.
AVITA Medical said that the company expects to reach cashflow breakeven in the fourth quarter of 2026. This suggests it has enough cash to reach that goal, assuming its cash burn doesn’t increase in the second half of 2026.
It also revealed that the Centers for Medicare & Medicaid Services released its proposed calendar year 2027 Medicare payment updates for RECELL that, if adopted, would set national (as opposed to region by region) physician payment for the use of RECELL as well as increased hospital outpatient and ambulatory surgical centre facility payment rates.
The ASX healthcare share has clearly had a volatile time in recent years – it’s down around 70% in the past five years. But, this is a promising step and it’s seeing solid revenue growth, combined with steady progress towards cashflow breakeven status.
It’s an interesting investment idea, though it’s not one of the ASX growth shares on my watchlist, but I’d be happy if I were a shareholder.
