Nano-X Imaging Ltd. Q2 FY2025 earnings call

• Commercial Expansion: Focused on expanding the commercial footprint with the goal of 100 Nanox.ARC systems installed or deployed by year-end. Most leads and new customer activity sourced from the U.S., with expansion in European countries like Romania and Greece post-CE mark designation. - Clinical Strategy: Collaborations with Duke University Medical Center and Keiser University; launched Nanox Academy digital platform for training; ongoing clinical studies with medical centers; strengthened Medical Advisory Board with new additions. - AI Business: Multiple collaborations with leading AI providers, deepc, CTIS, and Ezra; expanding academic collaborations; partnerships to integrate AI solutions into various platforms. - EU and Latin America Progress: Preparing to launch Nanox.ARC in Romania Radiology Congress, working on import permits in Greece; pursuing import licenses in Mexico for demo units. - Supply Chain: Sourcing glass tubes from Varex, entered multiyear Volume Supply Agreement with Fabrinet for scalable production of Nanox.ARC X.

For the second quarter of 2025, total revenue was $3.0 million. The teleradiology services segment generated revenue of $2.7 million with a GAAP gross profit of $0.5 million, representing a GAAP gross profit margin of approximately 18% and a non-GAAP gross profit margin of approximately 38%. Revenue from the sale and deployment of imaging systems and OEM services was $221,000 with a GAAP gross loss of $1.7 million. The AI solutions segment had revenue of $0.1 million with a GAAP gross loss of $2.0 million, while the non-GAAP gross loss was $19,000 compared to a gross profit of $57,000 in the comparable period. Research and development expenses net were $4.8 million for both the reported and comparable periods. Sales and marketing expenses were $1.2 million in the reported period compared to $0.8 million in the comparable period. General and administrative expenses were $5.1 million in the reported period compared to $5.9 million in the comparable period. Non-GAAP net loss attributable to ordinary shares was $10.9 million in the reported period compared to $8.4 million in the comparable period.

• Revenues expected to grow in the second half of 2025. - On track to meet the target of 100 Nanox.ARC systems installed or deployed by year-end. - 2026 expected to be breakeven in terms of revenues and expenses for the AI business.

• Risks associated with forward-looking statements, including uncertainties in regulatory processes, clinical activities, and market adoption. - Potential differences between expected and actual financial results due to factors described in the company's SEC filings.

Q: How many systems were operating during the quarter that resulted in $221,000 in imaging-related revenue?

A: More than 20 systems were operating and scanning patients.

Q: Are the 100 leads expected to have some capital sales?

A: A part of them will be CapEx.

Q: How many states in the United States are approved for users to operate a system?

A: Right now, 8.

Q: Talk about the current revenue model, mixture of CapEx and MSaaS?

A: In the U.S., it's a mixture of CapEx sales and MSaaS model; in Europe, sales to distributors will be in CapEx sales model; other territories depend on geographic traits.

Q: AI solutions revenue trend, expected to see more trends?

A: 2026 expected to be breakeven in AI revenues and expenses; growing activities like Ezra Medical partnership contributing to growth.