Tactile Systems Technology Inc (NASDAQ: TCMD) stock surged 26.15% on January 8th, 2019 (Source: Google finance) after the company announced that it expects the Full year 2018 total revenue in the range of $142.8 million to $143.3 million, representing growth of approximately 31% year-over-year. Flexitouch system revenue is expected in the range of $131.3 million to $131.8 million, representing growth of approximately 31% year-over-year. Entre and Actitouch systems revenue is expected to be of $11.5 million, representing growth of approximately 29% year-over-year
Fourth quarter total revenue is expected to be in the range of $45.5 million to $46.0 million, representing growth of approximately 30% to 32% year-over-year. Flexitouch system revenue in the range of $42.1 million to $42.6 million, representing growth of approximately 30% to 31% year-over-year. Entre and Actitouch systems revenue of approximately $3.4 million, representing growth of approximately 38% year-over-year
Flexitouch sales this quarter were driven by several of the primary growth drivers, including the expansion of and continuing execution from our field sales team, and higher than expected volume from a direct contract with a large commercial payer initiated in the third quarter.
Meanwhile, in the third quarter otal revenue increased 28% year-over-year, to $36.3 million, compared to $28.3 million in third quarter 2017. Flexitouch revenue increased 27% year-over-year, to $33.3 million, compared to $26.2 million in third quarter 2017. Operating income increased 17% year-over-year to $1.4 million, compared to operating income of $1.2 million in third quarter 2017. Net income increased 30% year-over-year to $1.7 million, compared to net income of $1.3 million in third quarter 2017. Adjusted EBITDA increased 83% year-over-year to $4.6 million compared to Adjusted EBITDA of $2.5 million in third quarter 2017.
On October 17, 2018, the Company announced an exclusive license agreement with Sun Scientific, Inc. for the intellectual property of the Aero-Wrap compression therapy products in the United States and Canada. The wearable Aero-Wrap products provide static (continuous) compression for patients with swelling in their legs. Pursuant to the license agreement, the Company paid Sun Scientific an initiation fee of $4.0 million and will also pay a royalty based on future sales. The transaction is expected to be immaterial to Tactile Medical’s 2018 and 2019 GAAP net income
Net income for the third quarter of 2018 increased approximately $0.4 million to $1.7 million, or $0.09 per diluted share, compared to net income of $1.3 million in the third quarter of 2017. The increase in net income was driven by a $0.2 million increase in pre-tax income and a $0.2 million increase in the tax benefit recognized in the current year quarter, compared to the third quarter of 2017.