Core Insights - Allurion Technologies has announced initial results indicating that combining the Allurion Program with low-dose tirzepatide therapy can optimize muscle mass and improve adherence to GLP-1 medications, achieving an average total weight loss of 23% and a 14% increase in lean body mass after 12 months [1][3][4] Study Details - The study involved 76 patients who were treated with the Allurion Smart Capsule and started on low-dose tirzepatide after 45 days of balloon therapy, with doses starting at 2.5mg and increasing to a maximum of 5.0mg over two months, significantly lower than the standard dosing of up to 15mg [2][4] - The follow-up period lasted 12 months, with patients monitored using the AI-powered Virtual Care Suite as part of the Allurion Program [2][3] Results - After 12 months, patients experienced an average total body weight loss of 23%, and lean body mass as a percentage of total body weight increased from 62% to 70% [3][4] - All patients remained adherent to tirzepatide throughout the study, with no early discontinuations [3][4] Expert Commentary - Dr. Luigi Flagiello highlighted the advantages of combining the Allurion Smart Capsule with GLP-1 medications, noting that this approach can lead to increased weight loss while preserving lean mass, and that lower doses of GLP-1s can enhance adherence [4][6] - Dr. Shantanu Gaur emphasized that the initial data addresses significant challenges associated with GLP-1 therapies, such as muscle wasting and adherence issues, and expressed optimism about validating these results in future clinical trials [6][7] Future Directions - Additional data on the combination approach is being collected and is expected to be presented at upcoming medical meetings [7]

Financial Performance - Revenue for the nine months ended September 30, 2025, was $11.6 million, a decrease of 56.3% compared to $26.5 million for the same period in 2024[232]. - The company incurred a net loss of $22.7 million for the nine months ended September 30, 2025, compared to a net income of $2.4 million for the same period in 2024[232]. - Revenue decreased by $2.7 million, or 50%, to $2.7 million for the three months ended September 30, 2025, and decreased by $14.9 million, or 56%, to $11.6 million for the nine months ended September 30, 2025, compared to the same periods in 2024[271]. - The company reported a net loss of $11.9 million for the three months ended September 30, 2025, compared to a net income of $8.7 million for the same period in 2024[270]. - The company incurred operating losses of $23.9 million and $33.1 million for the nine months ended September 30, 2025 and 2024, respectively[290]. Cost and Expenses - The cost of revenue decreased by $0.9 million, or 40%, to $1.4 million for the three months ended September 30, 2025, and decreased by $3.9 million, or 52%, to $3.7 million for the nine months ended September 30, 2025, compared to the same periods in 2024[272]. - Total operating expenses for the three months ended September 30, 2025, were $10.9 million, a decrease of $4.5 million compared to the same period in 2024[270]. - Gross profit decreased by $1.8 million, or 58%, to $1.3 million for the three months ended September 30, 2025, and decreased by $11.0 million, or 58%, to $8.0 million for the nine months ended September 30, 2025 compared to the same periods in 2024[273]. - Sales and marketing expenses decreased by $2.1 million, or 40%, to $3.1 million for the three months ended September 30, 2025, and decreased by $8.9 million, or 49%, to $9.2 million for the nine months ended September 30, 2025 compared to the same periods in 2024[274][276]. - Research and development expenses decreased by $1.2 million, or 37%, to $2.0 million for the three months ended September 30, 2025, and decreased by $6.8 million, or 51%, to $6.4 million for the nine months ended September 30, 2025 compared to the same periods in 2024[277][278]. - General and administrative expenses decreased by $1.3 million, or 18%, to $5.8 million for the three months ended September 30, 2025, and decreased by $4.5 million, or 22%, to $16.2 million for the nine months ended September 30, 2025 compared to the same periods in 2024[279][280]. Strategic Initiatives - The Allurion Program includes the Allurion Smart Capsule, the world's first swallowable intragastric balloon, and AI-powered remote patient monitoring tools[227]. - The Allurion Virtual Care Suite (VCS) was launched in April 2024 in the U.S. for patients utilizing various weight loss treatments, enhancing patient management[229]. - The company has submitted a premarket application to the FDA for the Allurion Program, aiming for commercialization in the U.S. by June 30, 2026[230][235]. - The company announced a strategic restructuring plan, including a reduction in force of approximately 70 employees, or about 65% of its workforce, with expected severance charges of approximately $1.5 million[249]. - The company signed a term sheet with a strategic partner to expand ex-US distribution and enhance the R&D pipeline, including the potential joint development of a novel GLP-1 drug-eluting intragastric balloon[253]. - The company expects to begin enrollment for a prospective, multi-center study on the combination of the Allurion Program with a low-dose of GLP-1 for weight loss while maintaining muscle mass this year[253]. Financing and Capital Management - The Omnibus Amendment requires the company to maintain minimum cash balances and achieve designated revenue thresholds, tested quarterly[235]. - The company raised at least $12.0 million in aggregate net proceeds through the issuance of shares as part of the Omnibus Amendment[236]. - The Second Amendment to Note Purchase Agreement allows for the mandatory conversion of $5.0 million of RTW Convertible Notes if market capitalization falls below $15.0 million[240]. - The company entered into a securities purchase agreement to issue and sell 2,994,012 shares of Common Stock for an aggregate purchase price of approximately $5.0 million[250]. - The company received net proceeds of $1.3 million from the issuance of shares and warrants in the Leavitt Private Placement on February 20, 2025[295]. - The company received $40.0 million in proceeds from the Revenue Interest Financing Agreement with RTW on August 1, 2023, with an obligation to remit revenue interest payments at specified rates[313]. - The revenue interest payment rate was increased from 6% to 12% for net sales less than or equal to $100 million prior to December 31, 2026, and from 10% to 12% for net sales on or after January 1, 2027[313]. - Cash provided by financing activities for the nine months ended September 30, 2025, was $14.4 million, consisting of $13.6 million from a public offering[328]. - The company entered into a November 2025 Securities Purchase Agreement, agreeing to issue 2,994,012 shares for approximately $5.0 million at a price of $1.67 per share[308]. - On April 16, 2024, the company received $48 million in gross proceeds from the Amended Note Purchase Agreement with RTW, used to repay the Fortress Term Loan[311]. Cash and Liquidity - As of September 30, 2025, the company had $6.1 million in cash and cash equivalents and an accumulated deficit of $244.9 million[290]. - The company expects to continue generating significant operating losses for the foreseeable future and may need to raise additional capital[292]. - For the nine months ended September 30, 2025, net cash used in operating activities was $23.6 million, compared to $29.0 million for the same period in 2024[318][319]. - The company has various non-cancellable operating leases expiring between 2025 and 2028, impacting future cash requirements[310]. - As of September 30, 2025, cash and cash equivalents totaled $6.1 million, primarily invested in money market funds[336]. - The company has no variable rate debt outstanding as of September 30, 2025[337]. Foreign Currency Exposure - A 10% increase or decrease in current exchange rates could materially impact the business, financial condition, or results of operations[339]. - The primary foreign currency exposure is related to sales and expenses in Europe, with additional exposure in the Middle East and Asia-Pacific regions[339]. - An immediate 10% adverse change in foreign exchange rates during the nine months ended September 30, 2025, would have impacted revenues by approximately 5% and expenses by 4%, affecting net income by about 3%[340]. - In comparison, during the nine months ended September 30, 2024, a similar adverse change would have impacted revenues by approximately 6% and expenses by 2%, affecting net loss by about 2%[340]. - The company has not engaged in any foreign currency hedging activities to date[340]. - The company will continue to reassess its approach to managing foreign currency exchange rate risks as international operations grow[340]. Investment Policy - The investment policy focuses on capital preservation and liquidity needs, avoiding speculative financial instruments[335]. - External investment managers are utilized to adhere to the investment policy guidelines[335].

Summary of Key Points Core Viewpoint The Public Investment Fund (PIF) has significantly reduced its holdings in US equities, indicating a strategic shift in investment focus. Group 1: PIF Holdings Overview - PIF's US equity holdings decreased to $19.4 billion in Q3 2025 from $23.8 billion in Q2 2025, marking a reduction of $4.4 billion [2] - The fund exited nine companies and all options contracts of 42 companies, while maintaining its investments in six firms [2] Group 2: Specific Company Holdings - Lucid Group's holdings remained at 177.1 million shares, with a value increase from $3.736 billion to $4.213 billion, a change of $476.3 million [4] - Electronic Arts maintained its holdings at 24.8 million shares, with a value increase from $3.962 billion to $5.004 billion, a change of $1.042 billion [4] - Uber's holdings remained at 72.8 million shares, with a value increase from $6.796 billion to $7.136 billion, a change of $340.2 million [4] - Take-Two Interactive's holdings remained at 11.4 million shares, with a value increase from $2.772 billion to $2.949 billion, a change of $177 million [4] - Clarivate's holdings remained at 1.3 million shares, with a value increase from $57.8 million to $68 million, a change of $10.2 million [6] Group 3: Notable Changes in Holdings - PIF exited its positions in several companies, including Air Products & Chemicals, Cummins Inc., Visa Inc., and Walmart, among others, indicating a strategic divestment [4][6] - Lucid Group executed a 1-for-10 reverse stock split in September 2025, reducing its authorized share capital from 15 billion shares to 1.5 billion shares [3][4]

Financial Data and Key Metrics Changes - Revenue for Q3 2025 was $2.7 million, down from $5.4 million in Q3 2024, primarily due to restructuring efforts [15] - Gross profit for Q3 2025 was $1.3 million, or 49% of revenue, compared to $3.1 million, or 58% of revenue in Q3 2024 [15] - Operating expenses were $10.9 million, a decrease of 29% compared to the prior year, with an operating loss of $9.6 million, narrowed by 22% year-over-year [9][10] - Adjusted net operating loss was $6.9 million, a 39% improvement compared to the prior year [10][17] Business Line Data and Key Metrics Changes - The restructuring in Q3 focused on accounts and distributors promoting metabolically healthy weight loss, which is expected to lead to long-term growth [7][8] - Sales and marketing expenses decreased to $3.1 million from $5.2 million in Q3 2024, driven by increased operational efficiency [15][16] - Research and development expenses were reduced to $2.0 million from $3.2 million in Q3 2024, reflecting cost reductions related to the Audacity trial [16] Market Data and Key Metrics Changes - The company is seeing a trend where patients who discontinue GLP-1 treatments represent a significant opportunity for Allurion, as over half of these patients seek alternative therapies [9][18] - The company anticipates that the reduction in GLP-1 prices in the U.S. will drive more uptake and subsequently increase churn rates, leading to more patients looking for alternative therapies [27] Company Strategy and Development Direction - The company is advancing preparations for the U.S. launch of the Allurion Smart Capsule, with a focus on combination therapies with low-dose GLP-1s [6][11] - Allurion is exploring the development of a drug-eluting balloon in collaboration with a strategic partner, which could address adherence challenges in obesity therapy [12][19] - The company is retooling its R&D pipeline and manufacturing capabilities to enhance operational efficiency and expand capacity [11][13] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the FDA approval process for the Allurion Smart Capsule, highlighting successful inspections and a positive Day 100 meeting outcome [5][6] - The company believes that the Allurion program is uniquely positioned to capitalize on the success of GLP-1s and set the stage for long-term growth in the obesity management market [18][19] Other Important Information - As of September 30, 2025, cash and cash equivalents were $6.1 million, not including a recent private placement financing of $5 million [17] - The company is on a path to being debt-free through a transaction to exchange outstanding debt for convertible preferred equity [10][11] Q&A Session Summary Question: How is the company applying learnings from international strategy to the U.S. market? - Management noted that they are learning from international experiences, particularly regarding the churn rates of GLP-1 patients, and are mapping out U.S. clinics that utilize GLP-1s [21][23] Question: What is the outlook for international revenues over the next 12 to 24 months? - Management expects continued growth in Q4 and into 2026 as clinics embrace GLP-1s and combination therapies [25][26] Question: Can you provide details on the development program for the Smart Capsule as a platform technology? - Management discussed the potential of the Smart Capsule to deliver various drugs and the initiation of a longer-term balloon project that could last beyond four months [29][32]

Securities Issuance - The Company is issuing securities to Purchasers under the terms of the Securities Purchase Agreement dated November 11, 2025[2]. - The Per Share and Accompanying Warrant Purchase Price is set at $1.67, subject to adjustments for stock splits and similar transactions[24]. - The Closing Date for the transaction is defined as the Trading Day when all conditions precedent have been satisfied or waived[9]. - The Company will provide Registration Rights to Purchasers for the resale of Shares and Warrant Shares[27]. - The Warrants issued to Purchasers will be exercisable for a term of five years from the initial exercise date[37]. - The Company is required to obtain Stockholder Approval for the issuance of Warrants and Warrant Shares[31]. - The Placement Agent for this transaction is Roth Capital Partners, LLC[26]. - The Company must comply with the Securities Act and related regulations in connection with this issuance[30]. - The Subscription Amount for each Purchaser is specified on the signature page of the Agreement[32]. - The Company agrees to sell up to an aggregate of $5,000,000.04 of Shares and Warrants to Purchasers[40]. - Each Purchaser will receive a Warrant to purchase up to a number of shares of Common Stock equal to 100% of such Purchaser's Shares, with an exercise price of $1.67[41]. - The Company must deliver a legal opinion and wire instructions to each Purchaser prior to the Closing Date[41]. - The Closing is subject to the accuracy of representations and warranties of the Purchasers and the Company[45][46]. - The Company has reserved the maximum number of shares of Common Stock issuable pursuant to this Agreement and the Warrants[56]. - The capitalization of the Company as of the date hereof is detailed in Schedule 3.1(g), including the number of shares owned by Affiliates[57]. - The Company has not issued any capital stock since its most recently filed periodic report under the Exchange Act, except for employee stock options and restricted stock units[57]. - The issuance and sale of the Securities will not obligate the Company to issue shares to any Person other than the Purchasers[58]. - The Company is not required to obtain any additional consents or approvals for the execution and delivery of the Transaction Documents, except for specified Required Approvals[55]. - All outstanding shares of capital stock of the Company are duly authorized, validly issued, fully paid, and nonassessable[58]. Compliance and Regulatory Matters - The Company has filed all required SEC Reports on time and complied with the Securities Act and the Exchange Act[59]. - There have been no material adverse events or liabilities incurred since the latest audited financial statements[61]. - The Company has not altered its accounting methods or declared any dividends since the last financial statements[61]. - The Company and its Subsidiaries are in compliance with all applicable labor laws and have good relationships with employees[63]. - The Company maintains a system of internal accounting controls that provides reasonable assurance regarding financial reporting[74]. - The Company possesses all necessary regulatory permits to conduct its business without any expected material adverse effects[67]. - The Company has good and marketable title to all material assets, free from significant liens[69]. - The Company has all necessary intellectual property rights for its business operations, with no known infringements[70]. - The Company is insured against losses and risks deemed prudent and customary in its industry[71]. - The Company is not classified as an "investment company" under the Investment Company Act of 1940[77]. - The Company confirms compliance with all listing and maintenance requirements of the Trading Market, with no notifications of non-compliance received in the past 12 months[79]. - The Company's assets are deemed sufficient to carry on its business, with no intention to incur debts beyond its ability to pay as they mature[84]. - The Company has filed all required tax returns and paid all material taxes, with no unpaid taxes claimed by any taxing authority[86]. - The Company has not experienced any security breaches or compromises related to its IT systems and data, maintaining compliance with applicable laws[95]. - The Company is in material compliance with FDA regulations for all products, with no pending actions or concerns from the FDA regarding product marketing[94]. Transaction Terms and Conditions - The Company has acknowledged that no Purchaser is acting as a financial advisor or fiduciary, and decisions are based solely on independent evaluations[90]. - The Company has taken necessary actions to render anti-takeover provisions inapplicable to Purchasers as a result of the transaction[80]. - The Company has no knowledge of any facts leading to a belief that it will file for reorganization or liquidation within one year from the closing date[84]. - The Company's accounting firm is registered and will express its opinion on the financial statements for the fiscal year ending December 31, 2024[88]. - The Company has implemented commercially reasonable safeguards to protect its confidential information and IT systems[95]. - The Company and its Subsidiaries have been in compliance with all applicable data privacy and security laws, including GDPR, for the last three years[97]. - The Company has not received any written notice of actual or potential liability under any Privacy Laws[97]. - Each stock option granted by the Company was in accordance with the stock option plan and had an exercise price at least equal to the fair market value on the grant date[98]. - The Company is not subject to any U.S. sanctions administered by the Office of Foreign Assets Control[99]. - The Company has conducted its operations in compliance with applicable financial record-keeping and reporting requirements related to money laundering laws[102]. - The issuance and sale of the Securities does not contravene the rules and regulations of the Trading Market[103]. - The Company has not engaged in any general solicitation for the sale of Securities[104]. - The Company has maintained the confidentiality of all disclosures made in connection with the transaction[116]. - The Purchasers are acquiring the Securities as principal for their own account and not with a view to distribute or resell[111]. - The Company acknowledges that the representations contained in the agreement do not modify the Purchasers' right to rely on the Company's representations and warranties[118]. - The Company acknowledges that Purchasers may pledge Securities to accredited investors without requiring Company approval, provided compliance with applicable securities laws[123]. - If a Purchaser resells Shares or Warrant Shares, they must notify the Company and provide necessary documentation, including a seller's representation letter[125]. Liquidated Damages and Obligations - The Company will incur liquidated damages of $10 per Trading Day for each $1,000 of Shares or Warrant Shares if it fails to deliver a certificate free from restrictive legends by the Legend Removal Date, increasing to $20 after five Trading Days[127]. - In the event of a Public Information Failure, the Company will pay Purchasers 1.0% of the aggregate Subscription Amount for each day until the failure is cured[131]. - The Company is required to file all reports under the Exchange Act until no Purchaser owns Securities or the Warrants have expired[130]. - The Company must issue a press release disclosing material terms of transactions and file a Current Report on Form 8-K with the Commission[134]. - The Company will not claim that any Purchaser is an "Acquiring Person" under any anti-takeover plan due to receiving Securities[135]. - The Company will use the net proceeds from the sale of the Securities for working capital purposes and will not use such proceeds for debt satisfaction, stock redemption, litigation settlement, or in violation of regulations[138]. - The Company has reserved a sufficient number of shares of Common Stock to enable the issuance of Shares and Warrant Shares as per the Agreement[141]. - The Company agrees to maintain the listing of its Common Stock on the current Trading Market and will apply to list all Shares and Warrant Shares promptly[142]. - Each Purchaser has the right to participate in up to 35% of any Subsequent Financing on the same terms provided for in the Subsequent Financing[144]. - The Company must provide a Subsequent Financing Notice detailing the proposed terms and amount of proceeds intended to be raised[145]. - If Purchasers' notifications for participation in Subsequent Financing are less than the total amount, the Company may proceed with the remaining portion[147]. - The Company will issue a widely disseminated press release disclosing the material terms of Subsequent Financing transactions by 9:30 am on the Trading Day of execution[151]. - The Company will not issue any shares of Common Stock or Common Stock Equivalents for 60 days after the Effective Date, except as specified in the ChEF Purchase Agreement[156]. - The Company is prohibited from entering into any Variable Rate Transaction for 60 days after the Effective Date[157]. - No Variable Rate Transaction shall be considered an Exempt Issuance[159]. - The Company must hold a stockholder meeting by January 31, 2026, to obtain Stockholder Approval for the terms of the Warrants[165]. - The Company shall not undertake a reverse or forward stock split without prior written consent from Purchasers holding a majority interest[163]. - The Company agrees to timely file a Form D regarding the Securities as required under Regulation D[166]. - Each Purchaser must maintain confidentiality regarding the terms of the transaction until publicly announced[161]. - The Company will pay all Transfer Agent fees and taxes related to the delivery of Securities to Purchasers[170]. - The Company must treat all Purchasers equally regarding any amendments or modifications to the Transaction Documents[160]. - The Company acknowledges that no Purchaser is restricted from trading the Company's securities after public announcement of the transactions[162]. - The Company will reimburse the prevailing party for reasonable attorneys' fees in any legal proceedings related to the Transaction Documents[177]. - The Company has established a rescission right for Purchasers if obligations under Transaction Documents are not timely performed[182]. - In case of loss or destruction of securities, the Company will issue replacement certificates upon satisfactory evidence of such loss[183]. - The Company acknowledges that monetary damages may not be adequate compensation for breaches of obligations under Transaction Documents[185]. - Any payments made by the Company that are later invalidated will revive the original obligations as if the payment had not occurred[186]. - Each Purchaser's obligations are independent, and no Purchaser is responsible for the obligations of others under Transaction Documents[187]. - The Company's obligation to pay liquidated damages continues until all amounts are paid, regardless of the cancellation of the related instrument[188]. - The Company agrees that ambiguities in Transaction Documents will not be resolved against the drafting party[190]. - The parties waive the right to a jury trial in any legal proceedings[191]. - The Securities Purchase Agreement has been duly executed by authorized signatories of the parties involved[192]. - The Purchaser's subscription amount and shares will be specified in the agreement, including beneficial ownership blockers[195].

Company Performance - Allurion Technologies, Inc. reported a quarterly loss of $0.57 per share, which was better than the Zacks Consensus Estimate of a loss of $0.65, representing an earnings surprise of +12.31% [1] - The company posted revenues of $3.38 million for the quarter ended June 2025, missing the Zacks Consensus Estimate by 43.21%, and a significant decline from year-ago revenues of $11.77 million [2] - Over the last four quarters, Allurion has surpassed consensus EPS estimates three times but has not beaten consensus revenue estimates [2] Stock Performance - Allurion Technologies' shares have lost about 78% since the beginning of the year, contrasting with the S&P 500's gain of 9.7% [3] - The current Zacks Rank for Allurion is 4 (Sell), indicating expectations for the stock to underperform the market in the near future [6] Future Outlook - The current consensus EPS estimate for the coming quarter is -$0.54 on revenues of $7.15 million, and for the current fiscal year, it is -$3.14 on revenues of $24.53 million [7] - The outlook for the Medical - Products industry, where Allurion operates, is currently in the top 39% of over 250 Zacks industries, suggesting potential for better performance compared to lower-ranked industries [8]

[Explanatory Note and Restatement](index=2&type=section&id=Explanatory%20Note) [Restatement Background](index=2&type=section&id=Restatement%20Background) The company is restating financial statements for prior periods, including Q2 2024, due to an accounting error from a material weakness in internal controls, impacting net income and equity components but not revenue or cash - An accounting error was identified, leading to the restatement of financial statements for multiple periods, including the quarter ended June 30, 2024[6](index=6&type=chunk)[7](index=7&type=chunk) - The error caused misstatements in Other comprehensive income (loss), Other income (expense), Net income (loss), Accumulated other comprehensive income (loss), and Accumulated deficit[9](index=9&type=chunk) - The error was attributed to an existing material weakness related to a lack of sufficient staff with public company and technical accounting experience, but importantly, the error did not affect revenue, gross profit, operating profit, or cash balances[9](index=9&type=chunk) - As a result of the error and restatement, management concluded that the Company's disclosure controls and procedures were not effective as of June 30, 2025[11](index=11&type=chunk) [PART I. FINANCIAL INFORMATION](index=6&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements (Unaudited)](index=6&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) Unaudited financial statements for H1 2025 show a **$10.8 million net loss** and a **$64.0 million stockholders' deficit**, raising substantial doubt about the company's going concern due to recurring losses [Condensed Consolidated Financial Statements](index=6&type=section&id=Condensed%20Consolidated%20Financial%20Statements) H1 2025 saw revenue decline to **$9.0 million** and a **$10.8 million net loss**, with cash at **$12.7 million** and a **$64.0 million stockholders' deficit** Condensed Consolidated Statements of Operations Highlights (Six Months Ended June 30, In thousands) | Metric | 2025 | 2024 (Restated) | | :--- | :--- | :--- | | Revenue | $8,959 | $21,152 | | Gross Profit | $6,658 | $15,859 | | Loss from Operations | $(14,234) | $(20,736) | | Net Loss | $(10,836) | $(6,326) | | Net Loss Per Share (Basic & Diluted) | $(1.79) | $(3.30) | Condensed Consolidated Balance Sheet Highlights (In thousands) | Metric | June 30, 2025 | December 31, 2024 (Restated) | | :--- | :--- | :--- | | Cash and cash equivalents | $12,722 | $15,379 | | Total Assets | $28,169 | $32,813 | | Total Liabilities | $92,145 | $110,791 | | Total Stockholders' Deficit | $(63,976) | $(77,978) | Condensed Consolidated Statements of Cash Flows Highlights (Six Months Ended June 30, In thousands) | Metric | 2025 | 2024 (Restated) | | :--- | :--- | :--- | | Net cash used in operating activities | $(17,082) | $(17,563) | | Net cash used in investing activities | $0 | $(539) | | Net cash provided by (used in) financing activities | $14,428 | $(673) | | Net decrease in cash | $(2,654) | $(18,775) | [Notes to Unaudited Condensed Consolidated Financial Statements](index=13&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) Notes disclose a 'Going Concern' warning due to recurring losses, detail financial restatements and debt agreements, and reveal a post-quarter strategic restructuring with a **65% workforce reduction** - The company has concluded there is substantial doubt about its ability to continue as a going concern for one year, due to recurring losses, negative operating cash flows, and the need to raise additional capital[47](index=47&type=chunk) - On August 5, 2025, the company announced a strategic restructuring plan to focus on GLP-1 combination therapy and U.S. market entry, which includes a reduction of approximately 70 employees (**65% of its workforce**) with expected severance charges of **$1.5 million**[214](index=214&type=chunk) - The company is involved in a legal proceeding with Vanderbilt University Medical Center, which is seeking damages of approximately **$2.5 million** for an alleged breach of a Clinical Trial Agreement[199](index=199&type=chunk)[350](index=350&type=chunk) - In August 2024, sales of the Allurion Balloon were suspended in France by the regulatory authority ANSM, but sales were cleared to resume in February 2025 after the company implemented a remediation plan[202](index=202&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=62&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses a **58% revenue decline** in H1 2025, reduced operating expenses, and critical liquidity issues, with substantial doubt about going concern, necessitating financing and a strategic restructuring including workforce reduction [Results of Operations](index=74&type=section&id=Results%20of%20Operations) H1 2025 revenue fell **58% to $9.0 million**, with gross profit also down **58%**, while total operating expenses decreased **43% to $20.9 million**, improving loss from operations to **$14.2 million** Comparison of Results for the Six Months Ended June 30 (In thousands) | Metric | 2025 | 2024 (Restated) | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Revenue | $8,959 | $21,152 | $(12,193) | -58% | | Gross Profit | $6,658 | $15,859 | $(9,201) | -58% | | Total Operating Expenses | $20,892 | $36,595 | $(15,703) | -43% | | Loss from Operations | $(14,234) | $(20,736) | $6,502 | 31% | - The **58% decrease in revenue** for the first half of 2025 was primarily caused by distributor transitions, lower investment in sales and marketing, the temporary suspension of sales in France, and efforts to manage credit risk with certain distributors[272](index=272&type=chunk)[291](index=291&type=chunk) - Sales and marketing expenses decreased by **53%** due to lower headcount from a Q4 2024 restructuring and a strategic reorganization of marketing spend towards more efficient channels[276](index=276&type=chunk) - Research and development expenses decreased by **56%**, mainly due to a **$3.0 million reduction** in costs related to the AUDACITY clinical trial as the PMA submission was completed[278](index=278&type=chunk) [Liquidity and Capital Resources](index=78&type=section&id=Liquidity%20and%20Capital%20Resources) As of June 30, 2025, the company held **$12.7 million in cash** but faces substantial doubt about its going concern due to recurring losses and negative cash flows, necessitating **$14.4 million** in H1 2025 financing activities - The company had **$12.7 million in cash and cash equivalents** as of June 30, 2025, and an accumulated deficit of **$233.0 million**[290](index=290&type=chunk) - Management explicitly states that based on recurring losses and the need for additional capital, there is substantial doubt about the company's ability to continue as a going concern for one year from the report's issuance date[292](index=292&type=chunk) - During the first six months of 2025, the company raised **$14.4 million** from financing activities, primarily through public offerings and private placements[327](index=327&type=chunk) - Key financing arrangements include the RTW Convertible Notes (**$43.0 million outstanding**), the Chardan Equity Facility, and a Revenue Interest Financing Agreement with RTW[301](index=301&type=chunk)[302](index=302&type=chunk)[304](index=304&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=86&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces low interest rate risk but significant foreign currency exchange risk, primarily in Europe, with a **10% adverse change** potentially impacting net income by **3%**; no hedging activities are currently employed - The company does not have significant interest rate risk, with cash equivalents in money market funds and no variable rate debt as of June 30, 2025[334](index=334&type=chunk)[335](index=335&type=chunk) - The company is exposed to foreign currency risk from transactions denominated in currencies other than the U.S. dollar, with primary exposure in Europe, where a **10% adverse change** in exchange rates would have impacted net income by approximately **3%** for the six months ended June 30, 2025[336](index=336&type=chunk)[338](index=338&type=chunk) - The company has not engaged in any foreign currency hedging activities to date[338](index=338&type=chunk) [Item 4. Controls and Procedures](index=86&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls were ineffective as of June 30, 2025, due to material weaknesses in internal control over financial reporting, including staffing and IT issues, with a remediation plan underway - The CEO concluded that the Company's disclosure controls and procedures were not effective as of June 30, 2025[341](index=341&type=chunk) - The ineffectiveness is due to material weaknesses in internal control over financial reporting, including: insufficient segregation of duties, lack of staff with public company/technical accounting experience, and insufficient IT controls[342](index=342&type=chunk) - A remediation plan is underway, which involves hiring more experienced accounting staff, implementing a new ERP system, adding more review controls, and hiring a national accounting firm to assist with control design[344](index=344&type=chunk)[347](index=347&type=chunk) [PART II. OTHER INFORMATION](index=89&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=89&type=section&id=Item%201.%20Legal%20Proceedings) The company faces a legal proceeding from Vanderbilt University Medical Center, seeking approximately **$2.5 million** for an alleged breach of a Clinical Trial Agreement, which the company intends to defend - On August 12, 2025, Vanderbilt University Medical Center filed a complaint against the Company, alleging breach of a Clinical Trial Agreement and seeking damages of approximately **$2.5 million**[350](index=350&type=chunk) [Item 1A. Risk Factors](index=89&type=section&id=Item%201A.%20Risk%20Factors) Material risk factors include potential disruptions and resource strain from the August 2025 strategic restructuring and workforce reduction, alongside adverse impacts from changes in U.S. fiscal and tax policies like the OBBBA - The August 2025 strategic restructuring and workforce reduction may not yield anticipated savings, could disrupt business operations, and may strain the company's limited resources[352](index=352&type=chunk)[353](index=353&type=chunk) - The company faces risks from potential changes in U.S. federal policies, including the 'One Big Beautiful Bill Act' (OBBBA) signed into law on July 4, 2025, which could affect the tax treatment of R&D expenses[354](index=354&type=chunk) [Other Part II Items](index=92&type=section&id=Other%20Part%20II%20Items) This section confirms no reportable events for unregistered equity sales, senior security defaults, or mine safety disclosures, and no Rule 10b5-1 trading plan adoptions or terminations by directors/officers - There were no unregistered sales of equity securities, defaults upon senior securities, or mine safety disclosures to report for the period[356](index=356&type=chunk)[357](index=357&type=chunk)[358](index=358&type=chunk) - No directors or officers adopted or terminated a Rule 10b5-1 trading plan during the fiscal quarter[359](index=359&type=chunk)

Financial Data and Key Metrics Changes - Revenue for Q2 2025 was $3.4 million, a decrease from $11.8 million in Q2 2024, primarily due to distributor transitions and lower investments in sales and marketing [17][19] - Gross profit for the second quarter was $2.5 million, or 74% of revenue, compared to $9 million, or 76% of revenue in the same period in 2024 [17] - Operating expenses decreased by 48% year-over-year, leading to an operating loss improvement of 26% compared to the prior year [16][19] Business Line Data and Key Metrics Changes - Clinics utilizing the combination approach for obesity management grew by 20% compared to 2024, indicating potential for future growth [15] - Sales and marketing expenses were reduced to $2.4 million from $6.7 million in Q2 2024, reflecting increased operational efficiency [18] - Research and development expenses decreased to $1.8 million from $4.3 million in Q2 2024, driven by cost reductions related to the Audacity trial [18] Market Data and Key Metrics Changes - The company is focusing on international markets where GLP-1s are less expensive, which is expected to drive adoption of the combination therapy [24][30] - The U.S. market presents a significant opportunity, with 40% of adults classified as obese, yet only 8 million currently using injectable obesity therapy [15] Company Strategy and Development Direction - The new strategy emphasizes metabolically healthy weight loss through combination therapy of the Allurion balloon and low-dose GLP-1s [6][7] - The company is transitioning away from distribution partners lacking access to accounts that can deliver comprehensive obesity care, focusing instead on high-performing accounts [9][10] - A term sheet was signed with a strategic partner to expand manufacturing capabilities and explore the development of a novel GLP-1 drug-eluting intragastric balloon [11] Management's Comments on Operating Environment and Future Outlook - Management acknowledges that the transition to the new strategy may cause short-term disruptions but believes it will lead to long-term growth [15][16] - The company is optimistic about the potential for FDA approval of its PMA submission, which could accelerate its U.S. market entry [37] - Management is confident that the combination therapy will establish a new standard of care in obesity management [21] Other Important Information - Cash and cash equivalents as of June 30, 2025, were $12.7 million, providing a runway for future operations [19] - The company anticipates recording charges of approximately $1.5 million related to the new strategic direction [16] Q&A Session Summary Question: How should we think about low-dose GLP-1s plus Allurion gastric balloon impacting overall costs for obesity care? - Management noted that GLP-1s are inexpensive internationally, and combining them with the Allurion program incurs minimal costs for patients, driving adoption [24][30] Question: Can you provide guidance on operating expenses for R&D and G&A? - Management indicated that R&D expenses of $1.8 million are appropriate for the near term, with overall operating expenses expected to decrease by approximately 50% due to restructuring [41][42] Question: What is the cash runway associated with the U.S. launch? - Management stated that cash needs will depend on the commercial strategy in the U.S., but they feel confident about the current cash position [45][46] Question: How will the new strategy impact reengagement with accounts in France? - Management expressed optimism that the combination therapy approach will positively impact reengagement with accounts in France, especially as GLP-1s become more accessible [51]

[Form 8-K: Allurion Technologies, Inc. (August 5, 2025)](index=1&type=section&id=Form%208-K%3A%20Allurion%20Technologies%2C%20Inc.%20%28August%205%2C%202025%29) [Item 2.02 Results of Operations and Financial Condition](index=3&type=section&id=Item%202.02%20Results%20of%20Operations%20and%20Financial%20Condition) The company announced preliminary unaudited Q2 2025 financial results, emphasizing they are not finalized and may materially differ from final figures - The company announced select preliminary unaudited financial results for the second quarter ended June 30, 2025[7](index=7&type=chunk) - These financial results have not yet been finalized by management or reviewed by the company's independent auditors, Deloitte & Touche LLP[8](index=8&type=chunk) - The company cautions that subsequent information may lead to material differences from these preliminary results, and investors should not place undue reliance on them[8](index=8&type=chunk) [Item 2.05 Costs Associated with Exit or Disposal Activities](index=3&type=section&id=Item%202.05%20Costs%20Associated%20with%20Exit%20or%20Disposal%20Activities) The company adopted a strategic restructuring plan, reducing its workforce by **65%** and incurring **$1.5 million** in charges, to refocus on key strategic areas - A strategic restructuring plan was adopted by the board of directors on July 23, 2025[9](index=9&type=chunk) - The company is shifting its focus to low-dose GLP-1 combination therapy, muscle mass maintenance, and U.S. market entry[9](index=9&type=chunk) Restructuring Plan Details | Metric | Value | | :--- | :--- | | **Workforce Reduction** | ~70 employees (~65% of workforce) | | **Expected Completion** | End of Q3 2025 | | **Estimated Charges** | ~$1.5 million (severance-related) | [Item 7.01 Regulation FD Disclosure](index=3&type=section&id=Item%207.01%20Regulation%20FD%20Disclosure) A press release detailing the company's new strategic direction was issued, with information furnished, not filed, under the Exchange Act - A press release was issued on August 5, 2025, titled "Allurion Announces New Strategic Direction With Increasing Focus on Low-Dose GLP-1 Combination Therapy, Muscle Mass Maintenance, and US Market Entry"[10](index=10&type=chunk) - The information provided under Items 2.02 and 7.01 (including Exhibit 99.1) is considered "furnished" and not "filed" under the Exchange Act, limiting its legal liability under Section 18[11](index=11&type=chunk) [Item 9.01 Financial Statements and Exhibits](index=3&type=section&id=Item%209.01%20Financial%20Statements%20and%20Exhibits) This section lists the exhibits accompanying the Form 8-K filing, with the press release on strategic direction as the primary exhibit Exhibits Filed | Exhibit | Description | | :--- | :--- | | 99.1 | Press Release issued by Allurion Technologies, Inc. on August 5, 2025 | | 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |

This presentation contains financial forecasts with respect to the Company's projected financial results for the Company for the periods indicated. These projections should not be relied upon as being necessarily indicative of future results. The assumptions and estimates underlying the prospective financial information are inherently uncertain and are subject to a wide variety of significant business, economic and competitive risks and uncertainties that could cause actual results to differ materially from ...