The Company's second quarter performance was driven by systematic growth in Home, solid machine sales in Critical Care, and continued progress in In-Center, even within the current economic environment. Home revenue for the second quarter of 2009 was $15.2 million, an increase of 28 percent when compared with revenues of $11.9 million for the second quarter of 2008. Critical Care and In-Center revenues were $5.2 million and $16.0 million, respectively, for the second quarter of 2009, representing an increase of 20 percent and 4 percent, respectively, when compared with revenue for the second quarter of 2008.

"Our second quarter results demonstrate our continued ability to improve key financial metrics including revenue, gross margin, adjusted EBITDA and cash usage," stated Jeffrey H. Burbank, Chief Executive Officer of NxStage Medical. "In addition, we successfully executed against key strategic relationships to further strengthen our financial position and enhance our market position."

Gross margin improved to 24 percent in the second quarter of 2009 as compared to 14 percent in the second quarter of 2008.

Net loss for the second quarter of 2009 was $12.5 million, or ($0.27) per share. Excluding the impact of a $2.0 million pre-tax charge related to terminating the Company's GE credit facility, recorded as interest expense, the net loss for the second quarter of 2009 was better than the Company's second quarter guidance for a net loss of $11.5 to $12.5 million. This compares to a net loss of $12.5 million for the second quarter of 2008, which included the benefit of a $2.1 million change in fair value of financial instruments.

Cash and cash equivalents as of June 30, 2009 were $24.5 million. The Company's cash usage from operations for the second quarter of 2009 was $6.9 million and includes the impact of approximately $1.9 million in fees to terminate the Company's GE credit facility. Excluding these one-time items, cash usage from operations was $5.0 million.

For the second quarter of 2009, the Company had an Adjusted EBITDA loss of $3.4 million, adjusted for stock-based compensation, deferred revenue recognized and other non-recurring expenses, compared with an Adjusted EBITDA loss of $7.7 million in the second quarter of 2008. These results were better than the Company's guidance for an Adjusted EBITDA loss of $5.0 to $6.0 million for the second quarter of 2009. (See the exhibits for a reconciliation of this non-GAAP measure.)

The Company also announced that its first UK based patients have started treatment with the NxStage System One. "We are pleased with the early results of our first international expansion," stated Burbank. "As we build our operational footprint in this region with Kimal, we are seeing strong early interest from providers and patients for our System One. With continued progress and execution, we would expect more meaningful patient additions in 2010."

Guidance:

The Company is maintaining its 2009 full-year guidance for revenues to be between $135 to $145 million, a net loss in the range of $42 to $47 million or ($0.90) to ($1.01) per share, and for an Adjusted EBITDA loss in the range of $13 to $18 million. The Company expects to achieve consolidated gross margins of between 27 percent to 32 percent in the fourth quarter of 2009.

For the third quarter of 2009, the Company is forecasting revenue to be within a range of $32.5 to $34.5 million. This forecast reflects the Company recognizing approximately $2.0 million of third quarter In-Center shipments in the fourth quarter of 2009, in connection with the transition of DaVita's bloodline distribution from Henry Schein, Inc. to Gambro Renal Products, Inc. At this adjusted revenue level, the Company would expect a net loss in the range of $10.0 to $11.0 million or ($0.21) to ($0.24) per share, and an Adjusted EBITDA loss in the range of $3.0 to $4.0 million for the third quarter of 2009.

This release contains a non-GAAP financial measure, a reconciliation of the Company's non-GAAP financial measure to its most comparable GAAP financial measure is in the exhibits to this press release.

Conference Call:

NxStage will also host a conference call today at 9:00 a.m. Eastern Time to discuss its second quarter financial results. To listen to the conference call, please dial 866-730-5765 (domestic) or 857-350-1589 (international). The passcode is 18840646. The call will also be webcast LIVE and can be accessed via the investor relations section of the Company's website at http://www.nxstage.com/ir.cfm.

A replay of the conference call will be available 3 hours after the start of the call through August 19, 2009. To access the replay dial 888-286-8010 (domestic) or 617-801-6888 (international) and enter passcode 52867664. An online archive of the conference call can be accessed via the investor relations section of the Company's website at http://www.nxstage.com/ir.cfm.

About NxStage

NxStage Medical, Inc. is a medical device company, headquartered in Lawrence, Massachusetts, USA, that develops, manufactures and markets innovative products for the treatment of ESRD and acute kidney failure. For more information on NxStage and its products, please visit the company's website at http://www.nxstage.com/.

Forward-Looking Statements

This release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this release that are not clearly historical in nature are forward-looking, and the words "anticipate," "believe," "expect," "estimate," "plan," and similar expressions are generally intended to identify forward-looking statements. Examples of these forward-looking statements include statements as to anticipated operating results, including revenues, loss, gross margin and Adjusted EBITDA numbers, beliefs regarding the value of strategic business relationships and statements regarding anticipated international sales, and other expectations as to future operating results.