Vivos (VVOS) Q3 2025: SCN Acquisition Drives 76% Revenue Surge, Validates Direct Sleep Practice Model

November 19, 2025 | By EarningsIQ Research

Vivos delivered a pivotal quarter as its Sleep Center of Nevada acquisition fueled a 76% revenue leap and marked a decisive shift away from legacy dental channels. The company’s new direct-to-patient sleep medical practice model is rapidly scaling, but integration costs and provider onboarding are temporarily compressing margins. With demand outstripping current capacity and a replicable affiliation strategy now in play, Vivos is positioned for accelerated growth and margin normalization into 2026.

Summary

• Business Model Pivot Validated: Direct sleep center acquisitions and affiliations are rapidly eclipsing legacy dental channels.
• Capacity Constraints Highlight Demand: Provider onboarding lags and infrastructure ramp are limiting near-term revenue capture.
• Scalability in Focus: Replicable model and expanding referral pipelines set up multi-market expansion and margin leverage.

Performance Analysis

Vivos’ third quarter results mark a watershed moment as the first full period reflecting its June acquisition of Sleep Center of Nevada (SCN), which drove a 76% year-over-year revenue increase to $6.8 million. The revenue mix is now dominated by service revenue from sleep testing and treatment centers, with SCN contributing $2.2 million in OSA (Obstructive Sleep Apnea) sleep testing and $1.3 million from new treatment centers. Legacy VIP enrollment revenue, tied to the company’s former dentist-focused model, declined further and is expected to phase out entirely by end of 2026.

Cost of sales rose 87% as Vivos invested heavily in integrating SCN and expanding its sleep optimization teams, resulting in compressed gross margins (down to 58% from 60% last year) and a Q3 net loss of $5.4 million. General and administrative expenses surged 42% year-to-date, reflecting higher personnel, infrastructure, and professional fees tied to rapid expansion. Cash burn increased, but was offset by $14.2 million in new financing, primarily from existing investors. The company’s balance sheet remains leveraged, with $3.1 million in cash and $23.1 million in liabilities at quarter-end.

• Service Revenue Now Dominant: Sleep center and treatment services comprise the majority of growth, displacing legacy dental VIP enrollments.
• Integration Costs Compress Margins: Upfront hiring and facility expansion costs are temporarily outpacing revenue realization.
• Cash Position Supported by Financing: Equity and debt infusions from major holders have funded the SCN acquisition and ongoing ramp.

The quarter’s results confirm that Vivos’ pivot to a direct sleep medical practice model is gaining traction, but also highlight the near-term financial strain of scaling operations ahead of full provider credentialing and capacity ramp.

Executive Commentary

Strategic Positioning

1. Direct-to-Patient Sleep Center Model

Vivos has shifted away from a legacy dental referral model to directly operating or affiliating with sleep medical practices, such as the SCN acquisition in Las Vegas. This approach places Vivos technology and care teams in direct contact with OSA patients, enabling higher conversion rates and more robust revenue capture per patient. The company’s SAMC (Sleep and Airway Medicine Centers) now serve as fully integrated diagnostic and treatment hubs.

2. Capacity Expansion and Provider Onboarding

Demand for Vivos’ OSA solutions is outpacing current operational capacity, with patient bookings stretching into February 2026. The company is aggressively expanding facilities and onboarding new dental and nurse practitioner providers, but the credentialing process introduces a three to six month ramp before full revenue realization. Management notes that current operations are servicing less than 40% of potential new patients from SCN’s pipeline.

3. Replicable Affiliation and Acquisition Strategy

The SCN playbook is being extended to new markets via both acquisitions and operational affiliations, as seen with the July agreement with MI Sleep, LLC in Michigan. Vivos retains operational control and shares economics with local partners, offering flexibility and compliance with healthcare regulations. The model is designed to be scalable and margin accretive as additional teams are deployed and utilization rises.

4. Diversified Referral Channels

Vivos is tapping into new referral pipelines, notably through a large local cardiology group now sending significant patient volume to SCN centers. The company sees opportunity to replicate this approach with other specialties (neurology, pediatrics, internal medicine), positioning Vivos as a turnkey partner for sleep disorder management across the medical landscape.

5. Margin Recovery and Cash Flow Path

Management targets contribution margins of 50% to 60% at steady-state SAMC operations, with profitability hinging on full provider deployment and utilization. While current costs are elevated due to upfront hiring and infrastructure, leadership expects revenue growth to outpace expenses as teams mature, driving the company toward cash flow breakeven and improved gross margins in 2026.

Key Considerations

This quarter marks a structural transformation for Vivos, with its business model, revenue mix, and operational focus all shifting toward scalable, direct-to-patient care. Investors should assess the sustainability, scalability, and profitability of this new model as it moves from pilot phase to multi-market rollout.

Key Considerations:

• Provider Bottleneck Limits Revenue Realization: Credentialing delays for new dental and nurse practitioner hires are constraining near-term patient throughput and revenue, though the pipeline remains robust.
• Margin Leverage Hinges on Utilization: Steady-state SAMC centers are modeled for 50%–60% contribution margins, but current costs are front-loaded and will normalize only as utilization rises.
• Affiliation Model Offers Scalable Growth: The MI Sleep partnership and ongoing M&A discussions suggest the model is replicable in both acquisition and non-acquisition formats, broadening Vivos’ addressable market.
• Referral Channel Diversification is Material: Partnerships with cardiology and other specialty practices could unlock new patient pools, driving both top-line and margin upside as these relationships mature.
• Balance Sheet Leverage and Cash Burn: Ongoing expansion is being funded by significant financing, but the path to cash flow breakeven is contingent on operational execution and margin recovery.

Risks

Execution risk remains elevated as Vivos scales its new model, particularly around provider onboarding, insurance credentialing, and integration of new affiliate partners. The company is also exposed to regulatory changes, reimbursement shifts, and competitive responses from entrenched CPAP and alternative OSA treatment providers. Elevated cash burn and balance sheet leverage heighten financial risk if margin recovery lags or growth stalls.

Forward Outlook

For Q4 and into 2026, Vivos management guided to:

• Continued sequential revenue growth as new providers are onboarded and capacity expands.
• Margin improvement as SAMC centers mature and utilization normalizes.

For full-year 2025, management highlighted:

• Ongoing investment in provider teams and infrastructure to support multi-market expansion.

Management emphasized several drivers for the outlook:

• Provider credentialing and onboarding will be the gating factor for revenue capture and margin improvement over the next two quarters.
• Expansion of referral channels, particularly in cardiology and other specialties, is expected to drive incremental patient volume and validate the model’s scalability.

Takeaways

Vivos’ Q3 results confirm the company’s new business model is taking hold, with direct-to-patient sleep centers now the primary growth engine. While integration costs and provider ramp are temporarily compressing margins, demand signals are robust and the model appears scalable across markets.

• Direct Sleep Center Model Drives Growth: The SCN acquisition and affiliated center strategy are transforming Vivos from a dental referral business into a vertically integrated sleep care platform, with strong early patient demand and referral channel expansion.
• Operational Execution Will Determine Margin Recovery: Provider onboarding, insurance credentialing, and utilization ramp are the key levers for unlocking modeled contribution margins and cash flow breakeven.
• Investors Should Watch Expansion Pace: Progress on new affiliations, provider deployment, and referral partnerships will be the leading indicators of multi-market scalability and sustainable profitability.

Conclusion

Vivos’ Q3 marks a genuine inflection point, validating its direct sleep center model and setting the stage for accelerated, margin-accretive growth. Near-term costs are elevated, but with robust demand and a scalable playbook, the company is positioned to capitalize on a large, underserved OSA market as operational bottlenecks clear.

Industry Read-Through

Vivos’ results highlight a broader shift in the sleep disorder treatment industry, as vertically integrated, patient-centric models begin to displace legacy referral and device-centric approaches. The success of SCN and the SAMC concept suggests that direct medical practice ownership or affiliation can unlock higher conversion and revenue per patient, a playbook that may be emulated by other device or therapy innovators. The expanding role of specialty referral channels, particularly cardiology, signals a convergence of sleep and chronic disease management that could reshape care pathways and reimbursement models across the sector.

VVOS Health Care Medical Devices Sleep Medicine Acquisition Affiliation OSA Direct-to-Patient