Profound Medical Corp. Q2 FY2025 earnings call

Rashed Dewan provided a summary of Q2 2025 financial results. Tom Tamberrino discussed the sales pipeline with 500 prospects in the targeting stage, over 100 leads in the engaged stage, and 80 qualified leads. The sales team was streamlined. Mathieu Burtnyk highlighted that the CAPTAIN trial was fully recruited and patient treatments were complete, and the TULSA-AI volume reduction software for BPH had a pilot release with positive clinical outcomes. Arun Menawat summarized that the sales team was stabilized, the TULSA-AI module for BPH was beneficial, and CAPTAIN data would be presented in December.

For the 3-month period ended June 30, 2025, the company received total orders of over $3 million and recorded revenue of $2.2 million, with $1.6 million from recurring revenue and $650,000 from onetime sale of capital equipment. Q2 2025 gross margin was 73% compared to 64% in Q2 2024. Total operating expenses in Q2 2025 were $15.4 million compared with $9.3 million in Q2 2024. The company recorded a net loss of $15.7 million or $0.52 per common share in Q2 2025 compared to a net loss of $6.9 million or $0.28 per common share in Q2 2024. As of June 30, 2025, Profound had cash of $35.2 million.

Profound continues to believe it will achieve 70%-75% growth in 2025 compared to 2024. The transition to a capital model is back-end loaded, and over the long term, the company expects to be 70% recurring revenue and 30% capital revenue. Q3 and Q4 are expected to show growth, with the revenue mix shifting from recurring to capital revenue.

Potential short-term delays in completing TULSA-PRO capital sales, uncertainty in the transition to the capital model, market acceptance of new products, and uncertainty related to reimbursement rule changes.

Q: Good to hear the guidance reiteration, want to understand the ramp and sales contribution from recurring and capital.

A: Arun and Tom discussed the switch to a med tech model, with capital revenue likely to dominate in the future, and long-term expecting 70% recurring revenue and 30% capital revenue.

Q: About BPH reimbursement rule, relative attractiveness of TULSA codes.

A: Mathieu Burtnyk discussed the CMS proposed rule, stating TULSA was impacted least and was favorable compared to other BPH procedures.

Q: About sales funnel stages, especially the contracting stage.

A: Arun and Tom explained that the contracting stage involves multiple departments and is complex but being streamlined.

Q: About sales force streamlining and burn reduction.

A: Rashed Dewan mentioned cash burn was expected to be lower in the second half as orders came in and gross margin remained strong.

Q: About active TULSA-PRO sites and TULSA-PLUS.

A: Arun mentioned there were 60 active sites, aiming for 75 by end of 2025, and TULSA-PLUS had potential with interventional MRs.

Q: About clinical trials and adoption pushback.

A: Mathieu and Arun discussed clinical registries, publications, and the complementary nature of TULSA with systemic therapies.

Q: About BPH volume reduction module launch.

A: Thomas and Mathieu discussed the pilot launch of the module, positive feedback, and upcoming full launch.

Q: About CAPTAIN data and payer conversations.

A: Mathieu and Arun discussed peer-reviewed publications and payer considerations based on trial outcomes.