Another Notable Development Hyperfine's track record of securing international approvals supports its expansion into global markets. Along with the latest expansion in the European market, the company also announced a distribution agreement to develop Asian markets. Estimates for Medpace's 2024 EPS have remained unchanged at $11.29 in the past 30 days. Shares of the company have soared 73.3% in the past year compared with the industry's 5.2% growth. With the recent addition of distributors and the previousl ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 _________________ FORM 10-Q _________________ (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2024 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ___________to_________ Commission File Number: 001-39949 Hyperfine, Inc. (Exact name of registrant as specified in its cha ...

Hyperfine, Inc. (HYPR) came out with a quarterly loss of $0.14 per share in line with the Zacks Consensus Estimate. This compares to loss of $0.17 per share a year ago. These figures are adjusted for non-recurring items. A quarter ago, it was expected that this company would post a loss of $0.17 per share when it actually produced a loss of $0.15, delivering a surprise of 11.76%. Over the last four quarters, the company has surpassed consensus EPS estimates two times. Hyperfine, which belongs to the Zacks M ...

[Executive Summary](index=1&type=section&id=Executive%20Summary) Hyperfine reported a strong Q1 2024, achieving commercial progress, clinical milestones, and product innovation with spending discipline [Q1 2024 Performance Overview](index=1&type=section&id=Q1%202024%20Performance%20Overview) Hyperfine achieved strong Q1 2024 commercial progress, clinical milestones, and product innovation, maintaining spending discipline - CEO Maria Sainz expressed satisfaction with the **strong start to 2024**, highlighting commercial progress in US and international markets, and key Q1 milestones[3](index=3&type=chunk) - The company's three **core value drivers**—Commercialization, Clinical Evidence, and Innovation—were successfully delivered upon in Q1 with **strong spending discipline**[3](index=3&type=chunk) [Business Update](index=1&type=section&id=Business%20Update) Hyperfine advanced clinical studies, launched AI software, expanded internationally, and gained visibility for its portable brain imaging system [Recent Achievements and Business Highlights](index=1&type=section&id=Recent%20Achievements%20and%20Business%20Highlights) Hyperfine achieved Q1 2024 milestones, including advancing clinical studies, launching AI software, and expanding international commercial reach - Initiated enrollment of CARE PMR study to assess the clinical utility of the Swoop® System for detecting ARIA in Alzheimer's patients receiving amyloid-targeting therapy[7](index=7&type=chunk) - Exceeded **100 patients enrolled** in ACTION PMR, an observational study for acute ischemic stroke detection using portable brain imaging[7](index=7&type=chunk) - Launched **8th generation AI-powered brain imaging software**, enhancing image quality and ease-of-use[7](index=7&type=chunk) - Appointed distributors in key EU markets to support international commercial expansion[7](index=7&type=chunk) - The portable Swoop Brain MR was prominently featured at key conferences, with **four abstracts** at the International Stroke Conference and **17** at the International Society for Magnetic Resonance Medicine[7](index=7&type=chunk) [Company and Product Description](index=3&type=section&id=Company%20and%20Product%20Description) Hyperfine developed the FDA-cleared portable Swoop® system, an ultra-low-field MRI for accessible bedside brain imaging globally - Hyperfine, Inc. developed the Swoop® system, the first **FDA-cleared portable, ultra-low-field, magnetic resonance brain imaging system**[8](index=8&type=chunk) - The Swoop® system received initial U.S. FDA clearance in **2020** and is approved for brain imaging in several countries, including Canada, Australia, the UK (UKCA certified), and the EU (CE certified), and is also available in New Zealand[8](index=8&type=chunk) - The company's mission is to revolutionize patient care globally through transformational, accessible, clinically relevant diagnostic imaging and data solutions, bringing brain imaging to the patient's bedside[9](index=9&type=chunk) [Financial Performance](index=1&type=section&id=Financial%20Performance) Hyperfine reported a 25% Q1 2024 revenue increase, improved gross margin, reduced expenses, and provided full-year 2024 guidance [First Quarter 2024 Financial Results](index=1&type=section&id=First%20Quarter%202024%20Financial%20Results) Hyperfine reported a 25% Q1 2024 revenue increase to $3.30 million, driven by 13 Swoop® system sales, improving gross margin and reducing net loss Q1 2024 Financial Highlights | Metric | Q1 2024 (in millions) | Q1 2023 (in millions) | Change (%) | | :----- | :-------------------- | :-------------------- | :--------- | | Revenue | $3.30 | $2.64 | 25% | | Gross Margin | $1.35 | $1.16 | 16.4% | | R&D Expenses | $5.57 | $5.46 | 2.0% | | SG&A Expenses | $6.43 | $8.73 | -26.3% | | Net Loss | $(9.85) | $(12.16) | -19.0% | | Net Loss per Share | $(0.14) | $(0.17) | -17.6% | - Hyperfine, Inc. sold **13 commercial Swoop® systems** in the first quarter of 2024[7](index=7&type=chunk) [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) Q1 2024 total sales increased to $3.295 million, primarily from device sales, with improved gross margin and a net loss of $9.848 million Condensed Consolidated Statements of Operations and Comprehensive Loss (in thousands) | Metric | Q1 2024 | Q1 2023 | YoY Change | | :-------------------- | :------ | :------ | :--------- | | **Sales** | | | | | Device | $2,704 | $2,132 | +26.8% | | Service | $591 | $503 | +17.5% | | **Total Sales** | **$3,295**| **$2,635**| **+25.0%** | | **Cost of Sales** | | | | | Device | $1,499 | $1,071 | +40.0% | | Service | $442 | $409 | +8.1% | | **Total Cost of Sales**| **$1,941**| **$1,480**| **+31.1%** | | **Gross Margin** | **$1,354**| **$1,155**| **+17.2%** | | **Operating Expenses**| | | | | Research and development| $5,570 | $5,461 | +2.0% | | General and administrative| $4,430 | $6,182 | -28.3% | | Sales and marketing | $2,004 | $2,547 | -21.4% | | **Total Operating Expenses**| **$12,004**| **$14,190**| **-15.4%** | | **Loss from operations**| **$(10,650)**| **$(13,035)**| **-18.3%** | | Interest income | $796 | $869 | -8.4% | | **Net loss** | **$(9,848)**| **$(12,160)**| **-19.0%** | | **Net loss per common share**| **$(0.14)**| **$(0.17)**| **-17.6%** | [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased to $85.443 million by March 31, 2024, primarily due to reduced cash, with stockholders' equity at $75.638 million Condensed Consolidated Balance Sheets (in thousands) | Metric | March 31, 2024 | December 31, 2023 | Change | | :-------------------- | :------------- | :---------------- | :----- | | **ASSETS** | | | | | Cash and cash equivalents | $63,204 | $75,183 | $(11,979) | | Total current assets | $79,690 | $88,908 | $(9,218) | | **Total assets** | **$85,443** | **$94,199** | **$(8,756)** | | **LIABILITIES** | | | | | Total current liabilities | $8,767 | $8,768 | $(1) | | **Total liabilities** | **$9,805** | **$9,800** | **$5** | | **STOCKHOLDERS' EQUITY**| | | | | Accumulated deficit | $(263,570) | $(253,722) | $(9,848) | | **Total stockholders' equity**| **$75,638**| **$84,399** | **$(8,761)** | [Condensed Consolidated Statement of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) Q1 2024 net cash used in operating activities was $12.510 million, resulting in an end-of-period cash balance of $63.204 million Condensed Consolidated Statement of Cash Flows (in thousands) | Metric | Q1 2024 | Q1 2023 | Change | | :-------------------- | :------ | :------ | :----- | | Net cash used in operating activities | $(12,510) | $(13,491) | $981 | | Net cash used in investing activities | $(145) | $(61) | $(84) | | Net cash provided by financing activities | $55 | $49 | $6 | | **Net decrease in cash and cash equivalents and restricted cash** | **$(12,600)**| **$(13,503)**| **$903** | | Cash, cash equivalents and restricted cash, end of period | $63,204 | $104,740 | $(41,536) | [2024 Financial Guidance](index=1&type=section&id=2024%20Financial%20Guidance) Management expects full-year 2024 revenue between $12 million and $15 million and a cash burn of approximately $40 million - Management expects full-year 2024 revenue to be **$12 million to $15 million**[7](index=7&type=chunk) - Management expects full-year 2024 cash burn to be approximately **$40 million**[7](index=7&type=chunk) [Corporate Information](index=1&type=section&id=Corporate%20Information) This section covers forward-looking statement disclaimers, investor contact details, and Q1 2024 earnings conference call information [Forward-Looking Statements](index=3&type=section&id=Forward-Looking%20Statements) This disclaimer warns that actual results may differ from expectations due to various risks, including product development and regulatory approvals - The press release includes forward-looking statements, and actual results may differ from expectations due to **significant risks and uncertainties**[11](index=11&type=chunk) - Factors that may cause differences include success of product development and commercialization, regulatory clearance, ability to grow, competition, market size, pricing, and ability to complete clinical studies[11](index=11&type=chunk) [Investor Relations](index=3&type=section&id=Investor%20Relations) Provides contact information for investor inquiries, directing them to Marissa Bych at Gilmartin Group LLC - Investor contact is Marissa Bych of Gilmartin Group LLC, reachable at **marissa@gilmartinir.com**[12](index=12&type=chunk) [Conference Call Details](index=1&type=section&id=Conference%20Call%20Details) Hyperfine hosted a conference call on May 13, 2024, to discuss Q1 2024 financial results and provide a business update - A conference call was hosted on **Monday, May 13, 2024**, at **1:30 p.m. PT/ 4:30 p.m. ET** to discuss Q1 2024 financial results and provide a business update[6](index=6&type=chunk) - Interested participants could register online at **https://investors.hyperfine.io/**, where a live and archived audio webcast was also available[6](index=6&type=chunk)

Wall Street expects a year-over-year increase in earnings on higher revenues when Hyperfine, Inc. (HYPR) reports results for the quarter ended March 2024. While this widely-known consensus outlook is important in gauging the company's earnings picture, a powerful factor that could impact its near-term stock price is how the actual results compare to these estimates.The earnings report, which is expected to be released on May 13, 2024, might help the stock move higher if these key numbers are better than exp ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2023 Commission file number: 001-39949 Hyperfine, Inc. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or organization) Delaware 98-1569027 (I.R.S. Employer Identification No.) 351 New Whitfield Street Guilford, Connecticut 06437 (Address o ...

Financial Data and Key Metrics Changes - For the full-year 2023, the company generated $11 million in revenue, up 62% compared to 2022, with Q4 revenue of $2.7 million, an 89% increase year-over-year [28][41] - Gross profit for the full-year was $4.8 million, compared to $0.9 million in 2022, with a gross margin of 43.1%, up 30 percentage points from the prior year [22][41] - The net loss for Q4 was $10.7 million, equating to a net loss of $0.15 per share, an improvement from a net loss of $13.1 million or $0.19 per share in the same period of the prior year [42] Business Line Data and Key Metrics Changes - The company sold seven Swoop systems in Q4, predominantly through U.S. direct sales, achieving a record average selling price [29] - The implementation programs run by the clinical support team have resulted in strong user advocates across various hospital departments [30] Market Data and Key Metrics Changes - The company is focusing on expanding its commercial efforts into select international markets, having received regulatory clearances such as CE and UKCA approval for its latest AI-powered software [19][71] - There is significant demand for brain MRI technology due to new FDA requirements for monitoring MRIs for patients on amyloid-targeting therapies [11] Company Strategy and Development Direction - The company is committed to three strategic pillars: innovation, clinical evidence, and commercialization, with a focus on expanding its Alzheimer's program [9][15] - The company plans to maintain a robust cadence of innovation to support the use of Swoop, particularly in stroke and Alzheimer's [9][17] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growth opportunities in Alzheimer's care, highlighting the potential for the Swoop system to improve access and equity in treatment [32][35] - The company expects to achieve revenue in the range of $12 million to $15 million for 2024, with a first-quarter expectation of over $3 million [43] Other Important Information - The company has initiated a new study called Care PMR to assess the use of the Swoop system in detecting ARIA complications in Alzheimer's patients [37] - The company has a cash runway into early 2026, with total cash burn expectations of approximately $40 million for 2024, down from $42 million in 2023 [44][60] Q&A Session Summary Question: What led to the revenue shortfall in Q4? - Management indicated that variability in deal closures affected Q4 performance, but they are confident in the progress made in Q1 [64] Question: Can you explain the guidance for 2024 revenue? - Management provided a range of $12 million to $15 million, emphasizing steady progress in adoption and commercialization while investing in R&D and clinical evidence [50][72] Question: How does the company plan to manage cash flow and burn rate? - The company is focused on maintaining spending discipline while investing in growth initiatives, with a projected cash burn of approximately $40 million for 2024 [53][60]

Hyperfine, Inc. (NASDAQ:HYPR) Q3 2023 Earnings Call November 9, 2023 4:30 PM ET Company Participants Marissa Bych - Investor Relations Maria Sainz - President and Chief Executive Officer Brett Hale - Chief Administrative Officer and Chief Financial Officer Conference Call Participants Neil Chatterji - B. Riley Operator Good afternoon, and welcome to Hyperfine's Third Quarter 2023 Earnings Conference Call. Currently, all participants are in a listen-only mode. We will be facilitating a question-and-answer se ...

The Swoop system expands the fast growing (6% annual CAGR) $35 billion global imaging market. CONFIDENTIAL – PROPERTY OF HYPERFINE, INC. ©2023, All rights reserved. 10 Deep Foundation to Drive Long-term Success Rapid Innovation Clinical Proof Regulatory Excellence Ecosystem of Support 11 A First for Brain Health | --- | --- | |---------------------|----------------------------------------------------| | | | | | | | Hyperfine, Inc. has | | | 01 | reimagined brain imaging | | with the | Swoop system — | | | a ...

[Cautionary Statement Regarding Forward-Looking Statements](index=3&type=section&id=CAUTIONARY%20STATEMENT%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) This report contains forward-looking statements based on management's beliefs and assumptions, subject to **inherent risks, uncertainties, and assumptions** - This report contains forward-looking statements based on management's beliefs and assumptions, which are subject to **inherent risks, uncertainties, and assumptions**. These statements are **not guarantees of performance** and readers should not place **undue reliance** on them[9](index=9&type=chunk)[12](index=12&type=chunk) - Forward-looking statements include, but are not limited to, those concerning **product development, commercialization, regulatory approval, technology acquisition, competition, market size, pricing, financial performance, and global economic factors**[11](index=11&type=chunk)[13](index=13&type=chunk) [PART I — FINANCIAL INFORMATION](index=5&type=section&id=PART%20I%20%E2%80%94%20FINANCIAL%20INFORMATION) This section provides the Company's unaudited condensed consolidated financial information [Item 1. Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements of Hyperfine, Inc. and its subsidiaries, prepared in accordance with U.S. GAAP [Condensed Consolidated Balance Sheets (unaudited)](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20(unaudited)) This statement provides a snapshot of the Company's assets, liabilities, and equity at specific points in time Condensed Consolidated Balance Sheets (in thousands) | Metric | September 30, 2023 (in thousands) | December 31, 2022 (in thousands) | | :-------------------------- | :-------------------------------- | :-------------------------------- | | Cash and cash equivalents | $85,424 | $117,472 | | Total current assets | $98,215 | $128,664 | | Total assets | $103,064 | $134,051 | | Total current liabilities | $8,211 | $8,803 | | Total liabilities | $9,297 | $10,329 | | Total stockholders' equity | $93,767 | $123,722 | [Condensed Consolidated Statements of Operations and Comprehensive Loss (unaudited)](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss%20(unaudited)) This statement details the Company's revenues, expenses, and net loss over specific reporting periods Metric (in thousands) | Metric (in thousands) | Three Months Ended Sep 30, 2023 | Three Months Ended Sep 30, 2022 | Nine Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2022 | | :-------------------- | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Total sales | $2,330 | $2,348 | $8,346 | $5,390 | | Gross margin | $1,124 | $688 | $3,723 | $607 | | Total operating expenses | $12,883 | $13,970 | $40,209 | $60,852 | | Loss from operations | $(11,759) | $(13,282) | $(36,486) | $(60,245) | | Net loss | $(10,757) | $(13,171) | $(33,554) | $(60,105) | | Net loss per share (basic & diluted) | $(0.15) | $(0.19) | $(0.47) | $(0.85) | [Condensed Consolidated Statements of Changes in Stockholders' Equity (unaudited)](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Stockholders'%20Equity%20(unaudited)) This statement outlines changes in the Company's equity components, including net loss and stock-based compensation Metric (in thousands) | Metric (in thousands) | Balance, Dec 31, 2022 | Balance, Sep 30, 2023 | | :-------------------- | :-------------------- | :-------------------- | | Total Stockholders' Equity | $123,722 | $93,767 | | Net loss (9 months) | N/A | $(33,554) | | Stock-based compensation expense (9 months) | N/A | $3,453 | [Condensed Consolidated Statements of Cash Flows (unaudited)](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20(unaudited)) This statement summarizes the Company's cash inflows and outflows from operating, investing, and financing activities Cash Flow Activity (in thousands) | Cash Flow Activity (in thousands) | Nine Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2022 | | :-------------------------------- | :----------------------------- | :----------------------------- | | Net cash used in operating activities | $(31,871) | $(56,994) | | Net cash used in investing activities | $(546) | $(427) | | Net cash provided by financing activities | $146 | $2 | | Net decrease in cash, cash equivalents, and restricted cash | $(32,271) | $(57,419) | | Cash, cash equivalents and restricted cash, end of period | $85,972 | $133,741 | [Notes to Condensed Consolidated Financial Statements (unaudited)](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements%20(unaudited)) These notes provide detailed information on the Company's organization, accounting policies, revenue, and other financial disclosures [1. Organization and Description of Business](index=9&type=section&id=1.%20ORGANIZATION%20AND%20DESCRIPTION%20OF%20BUSINESS) This section describes Hyperfine, Inc.'s core business, its flagship Swoop® system, and recent program changes - Hyperfine, Inc. is an innovative health technology business focused on revolutionizing patient care globally through its **Swoop® Portable MR Imaging® System**, an **ultra-low-field (ULF)** magnetic resonance diagnostic brain imaging device[26](index=26&type=chunk) - The **Swoop® system** received initial **510(k) clearance** from the U.S. FDA in **2020**, with additional **AI-powered software updates cleared in February and October 2023**, significantly improving image quality[26](index=26&type=chunk) - The Company suspended its **Liminal program**, which focused on developing a device to non-invasively measure key vital signs in the brain, in **December 2022**[26](index=26&type=chunk) [2. Summary of Significant Accounting Policies](index=9&type=section&id=2.%20SUMMARY%20OF%20SIGNIFICANT%20ACCOUNTING%20POLICIES) This section outlines the accounting principles and policies used in preparing the consolidated financial statements - The condensed consolidated financial statements are prepared in accordance with **U.S. GAAP** and include the accounts of Hyperfine, Inc. and its subsidiaries[27](index=27&type=chunk) - The Company relies on **single-source manufacturers and suppliers**, and disruptions could negatively impact its business[32](index=32&type=chunk) - The Company operates as a **single reportable segment (Legacy Hyperfine)** and adopted **ASU 2016-13 (Credit Losses)** effective **January 1, 2023**, with **no material impact**[35](index=35&type=chunk)[41](index=41&type=chunk) [3. Revenue Recognition](index=12&type=section&id=3.%20REVENUE%20RECOGNITION) This section details the Company's revenue streams, disaggregated by product type, and remaining performance obligations Disaggregated Revenue (in thousands) | Product Type | Three Months Ended Sep 30, 2023 | Three Months Ended Sep 30, 2022 | Nine Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2022 | | :----------- | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Device | $1,728 | $1,945 | $6,670 | $4,305 | | Service | $602 | $403 | $1,676 | $1,085 | | **Total Revenue** | **$2,330** | **$2,348** | **$8,346** | **$5,390** | - Revenue recognized from deferred revenue balances at the beginning of the period was **$477 thousand** for the three months and **$1,119 thousand** for the nine months ended September 30, 2023[48](index=48&type=chunk) - As of September 30, 2023, remaining performance obligations amounted to **$5,499 thousand**, with approximately **11%** expected to be recognized in fiscal year 2023 and **89%** in fiscal year 2024 and thereafter[53](index=53&type=chunk) [4. Fair Value of Financial Instruments](index=13&type=section&id=4.%20FAIR%20VALUE%20OF%20FINANCIAL%20INSTRUMENTS) This section explains the Company's fair value measurement hierarchy for financial instruments - The Company measures fair value using a **three-tier hierarchy**, with all classified assets being **Level 1** (quoted prices in active markets)[55](index=55&type=chunk)[57](index=57&type=chunk) - As of September 30, 2023, **$85.96 million** in money market funds, demand deposit, and savings accounts were classified as **Level 1 assets**[59](index=59&type=chunk) [5. Inventories](index=14&type=section&id=5.%20INVENTORIES) This section provides a breakdown of the Company's inventory components, including raw materials and finished goods Inventories (in thousands) | Category | September 30, 2023 | December 31, 2022 | | :------------ | :----------------- | :---------------- | | Raw materials | $2,725 | $2,241 | | Finished goods | $4,215 | $2,381 | | **Total Inventories** | **$6,940** | **$4,622** | [6. Property and Equipment, Net](index=14&type=section&id=6.%20PROPERTY%20AND%20EQUIPMENT,%20NET) This section details the Company's property and equipment, net of accumulated depreciation and amortization Property and Equipment, Net (in thousands) | Category | September 30, 2023 | December 31, 2022 | | :------------------------ | :----------------- | :---------------- | | Total historical cost | $6,106 | $5,570 | | Less: Accumulated depreciation and amortization | $(2,948) | $(2,322) | | **Property and equipment, net** | **$3,158** | **$3,248** | - Depreciation expense was **$278 thousand** for the three months and **$791 thousand** for the nine months ended September 30, 2023[61](index=61&type=chunk) [7. Accrued Expenses and Other Current Liabilities](index=15&type=section&id=7.%20ACCRUED%20EXPENSES%20AND%20OTHER%20CURRENT%20LIABILITIES) This section itemizes the Company's accrued expenses and other current liabilities at period-end Accrued Expenses and Other Current Liabilities (in thousands) | Category | September 30, 2023 | December 31, 2022 | | :------------------------ | :----------------- | :---------------- | | Bonus | $2,340 | $2,674 | | Contracted services | $964 | $1,127 | | Legal fees | $284 | $261 | | Payroll and related benefits | $1,290 | $1,876 | | Other | $375 | $38 | | **Total** | **$5,253** | **$5,976** | [8. Equity Incentive Plan](index=15&type=section&id=8.%20EQUITY%20INCENTIVE%20PLAN) This section outlines the Company's stock option and restricted stock unit activity and related compensation expense Stock Option Activity (Number of Options) | Activity | Nine Months Ended Sep 30, 2023 | | :------------------------ | :----------------------------- | | Outstanding at January 1, 2023 | 10,719,564 | | Granted | 4,974,648 | | Exercised | (160,787) | | Forfeited / Cancelled / Expired | (879,190) | | **Outstanding at September 30, 2023** | **14,654,235** | Restricted Stock Unit (RSU) Activity (Number of RSUs) | Activity | Nine Months Ended Sep 30, 2023 | | :------------------------ | :----------------------------- | | Outstanding at January 1, 2023 | 1,585,359 | | Granted | 29,000 | | Vested | (754,679) | | Forfeited | (173,165) | | **Outstanding at September 30, 2023** | **686,515** | Stock-Based Compensation Expense by Functional Line Item (in thousands) | Category | Three Months Ended Sep 30, 2023 | Three Months Ended Sep 30, 2022 | Nine Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2022 | | :------------------------ | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Cost of sales | $26 | $34 | $77 | $85 | | Research and development | $371 | $339 | $805 | $1,851 | | Sales and marketing | $44 | $79 | $139 | $291 | | General and administrative | $753 | $(2,806) | $2,432 | $6,632 | | **Total** | **$1,194** | **$(2,354)** | **$3,453** | **$8,859** | [9. Net Loss Per Share](index=16&type=section&id=9.%20NET%20LOSS%20PER%20SHARE) This section presents the calculation of basic and diluted net loss per common share and anti-dilutive shares Net Loss Per Common Share (Basic and Diluted) | Metric | Three Months Ended Sep 30, 2023 | Three Months Ended Sep 30, 2022 | Nine Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2022 | | :------------------------ | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Net Loss (in thousands) | $(10,757) | $(13,171) | $(33,554) | $(60,105) | | Weighted-average shares | 71,464,315 | 70,509,639 | 71,178,769 | 70,398,103 | | **Basic and dilutive net loss per share** | **$(0.15)** | **$(0.19)** | **$(0.47)** | **$(0.85)** | Anti-Dilutive Common Equivalent Shares | Category | September 30, 2023 | September 30, 2022 | | :------------------------ | :----------------- | :----------------- | | Outstanding options | 14,654,235 | 8,544,480 | | Outstanding RSUs | 686,515 | 2,037,517 | | Earn-Out Shares | 9,357,835 | 9,450,862 | | **Total anti-dilutive common equivalent shares** | **24,698,585** | **20,032,859** | [10. Income Taxes](index=17&type=section&id=10.%20INCOME%20TAXES) This section discusses the Company's income tax rate and the valuation allowance against deferred tax assets - The Company's estimated annual effective income tax rate was **0.0%** for the three and nine months ended September 30, 2023 and 2022[73](index=73&type=chunk) - A **full valuation allowance** has been recorded against net deferred tax assets, as management believes it is more likely than not that the benefits will not be realized[74](index=74&type=chunk) [11. Related Party Transactions](index=18&type=section&id=11.%20RELATED%20PARTY%20TRANSACTIONS) This section discloses transactions with related parties, including sublease agreements and service arrangements - The Company subleases office and lab space from **4Catalyzer Corporation (4C)**, a related party, paying approximately **$122 thousand** (3 months) and **$255 thousand** (9 months) in rent during 2023[75](index=75&type=chunk) - The Company incurred expenses from **4C** of **$26 thousand** (3 months) and **$71 thousand** (9 months) in 2023 for services under a **Master Services Agreement**[78](index=78&type=chunk) - **Technology and Services Exchange Agreements (TSEA)** exist with other participant companies controlled by the Rothbergs, allowing use of non-core technologies[79](index=79&type=chunk) [12. Commitments and Contingencies](index=19&type=section&id=12.%20COMMITMENTS%20AND%20CONTINGENCIES) This section details the Company's commitments, grant funding, and absence of material legal proceedings - The Company did not make any matching contributions to its **401(k) plan** for the three and nine months ended September 30, 2023 or 2022[80](index=80&type=chunk) - The Company received an additional **$3.35 million grant** from the **Bill & Melinda Gates Foundation (BMGF)** in **May 2023** to develop a scalable approach to measuring neurodevelopment via low-field MRI in children in low-to-middle income countries[81](index=81&type=chunk) - The Company is **not currently a party to any material legal proceedings** and has **not recorded any liability** under indemnification provisions[84](index=84&type=chunk)[85](index=85&type=chunk) [13. Subsequent Events](index=20&type=section&id=13.%20SUBSEQUENT%20EVENTS) This section confirms the evaluation of events occurring after the balance sheet date for disclosure requirements - The Company has evaluated subsequent events through the financial statement issuance date and determined **no events require disclosure**[87](index=87&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=21&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the Company's financial condition and results of operations, including an overview of the business, key performance metrics, factors affecting results, and a detailed analysis of financial performance and liquidity [Overview](index=21&type=section&id=Overview) This section introduces Hyperfine's mission, the Swoop® system's market impact, and recent organizational changes - Hyperfine's mission is to revolutionize patient care globally with its **Swoop® Portable MR Imaging® System**, an **ultra-low-field (ULF)** magnetic resonance diagnostic brain imaging device[89](index=89&type=chunk) - The **Swoop® system** addresses the increasing demand for MR imaging, aiming to expand the **$35 billion imaging market** by providing accessible, cost-effective MRI in various care settings[90](index=90&type=chunk)[91](index=91&type=chunk) - The Company suspended its **Liminal brain sensing platform** development and underwent an **organizational restructuring** in **December 2022**, terminating approximately **13% of its global workforce** to decrease costs[95](index=95&type=chunk) [Key Performance Metrics](index=22&type=section&id=Key%20Performance%20Metrics) This section highlights the total installed base of Swoop® systems as a crucial indicator of business growth - The **total installed base of Swoop® systems** is a key metric for business growth, comprising commercial, grant fulfillment, and research units[97](index=97&type=chunk) Total Swoop® Systems Installed Units | Category | As of September 30, 2023 | As of September 30, 2022 | | :------------------------ | :----------------------- | :----------------------- | | Commercial system units | 91 | 57 | | Grant fulfillment units | 21 | 20 | | Research units | 21 | 23 | | **Total Installed Units** | **133** | **100** | [Factors Affecting Results of Operations](index=23&type=section&id=Factors%20Affecting%20Results%20of%20Operations) This section discusses the impact of technical innovation, commercialization strategies, and international expansion on financial performance - The Company continuously invests in **technical innovation**, improving **AI-powered image quality** and developing new imaging applications to broaden clinical uses and explore the **Swoop® system's** role as a clinical decision support platform[101](index=101&type=chunk) - Commercialization efforts are primarily focused on the **United States**, building direct sales and field support to increase adoption and routine use in hospital systems[102](index=102&type=chunk) - International expansion includes commercialization in **Canada, Australia, New Zealand, and Pakistan**, with grant funding from the **BMGF** supporting deployments in low-to-middle income countries[103](index=103&type=chunk)[104](index=104&type=chunk) [Results of Operations](index=24&type=section&id=Results%20of%20Operations) This section provides a detailed analysis of the Company's revenues, costs, expenses, and net loss for the reporting periods Consolidated Statement of Operations Summary (in thousands) | Metric | Three Months Ended Sep 30, 2023 | Three Months Ended Sep 30, 2022 | Change % (3M) | Nine Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2022 | Change % (9M) | | :------------------------ | :------------------------------ | :------------------------------ | :------------ | :----------------------------- | :----------------------------- | :------------ | | Device Sales | $1,728 | $1,945 | (11.2)% | $6,670 | $4,305 | 54.9% | | Service Sales | $602 | $403 | 49.4% | $1,676 | $1,085 | 54.5% | | **Total Sales** | **$2,330** | **$2,348** | **(0.8)%** | **$8,346** | **$5,390** | **54.8%** | | Cost of Sales | $1,206 | $1,660 | (27.3)% | $4,623 | $4,783 | (3.3)% | | Gross Margin | $1,124 | $688 | 63.37% | $3,723 | $607 | 513.34% | | Research and development | $5,739 | $7,338 | (21.8)% | $16,531 | $22,937 | (27.9)% | | General and administrative | $4,615 | $3,198 | 44.3% | $16,103 | $26,570 | (39.4)% | | Sales and marketing | $2,529 | $3,434 | (26.4)% | $7,575 | $11,345 | (33.2)% | | **Total Operating Expenses** | **$12,883** | **$13,970** | **(7.8)%** | **$40,209** | **$60,852** | **(33.9)%** | | Loss from Operations | $(11,759) | $(13,282) | (11.5)% | $(36,486) | $(60,245) | (39.4)% | | Interest income | $1,021 | $170 | 500.6% | $2,920 | $203 | 1,338.4% | | Net Loss | $(10,757) | $(13,171) | (18.3)% | $(33,554) | $(60,105) | (44.2)% | - Device sales decreased by **$0.2 million (11.2%)** for the three months ended September 30, 2023, primarily due to decreased volume, but increased by **$2.4 million (54.9%)** for the nine months, driven by higher sales prices[106](index=106&type=chunk)[108](index=108&type=chunk) - Service sales increased by **$0.2 million (49.4%)** for the three months and **$0.6 million (54.5%)** for the nine months ended September 30, 2023, driven by an increase in commercial system units installed[107](index=107&type=chunk)[109](index=109&type=chunk) - Interest income significantly increased by **$0.9 million (500.6%)** for the three months and **$2.7 million (1,338.4%)** for the nine months ended September 30, 2023, due to higher interest rates and cash balances[120](index=120&type=chunk)[121](index=121&type=chunk) [Liquidity and Capital Resources](index=27&type=section&id=Liquidity%20and%20Capital%20Resources) This section assesses the Company's cash position, funding outlook, and cash flow from operating activities - As of September 30, 2023, the Company had cash and cash equivalents of **$85.4 million**, with an accumulated deficit of **$243.0 million**[125](index=125&type=chunk) - The Company expects to incur **significant cash burn and recurring net losses**, but anticipates existing cash and sales proceeds will fund operations for at least the **next 12 months**[125](index=125&type=chunk)[126](index=126&type=chunk) - Net cash used in operating activities decreased to **$31.9 million** for the nine months ended September 30, 2023, from **$57.0 million** in the prior year, primarily due to a lower net loss and non-cash adjustments[132](index=132&type=chunk)[133](index=133&type=chunk) [Critical Accounting Policies and Significant Judgments and Estimates](index=30&type=section&id=Critical%20Accounting%20Policies%20and%20Significant%20Judgments%20and%20Estimates) This section confirms no material changes to the Company's critical accounting policies and estimates - There have been **no material changes** to the Company's critical accounting policies and estimates as compared to those disclosed in its Annual Report on Form 10-K for the year ended December 31, 2022[143](index=143&type=chunk) [Recently Issued Accounting Pronouncements](index=30&type=section&id=Recently%20Issued%20Accounting%20Pronouncements) This section refers to disclosures regarding recently issued accounting pronouncements in the financial statement notes - A description of recently issued accounting pronouncements is provided in **Note 2** to the unaudited condensed consolidated financial statements[144](index=144&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=31&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section outlines the Company's exposure to market risks, including interest rate risk, inflation risk, and foreign exchange risk, and management's approach to these exposures - The Company's primary market risk exposure is from fluctuations in **interest rates, inflation, and foreign exchange**[146](index=146&type=chunk) - A **0.5 percentage point decrease** in interest rates would decrease earnings before income taxes by **$0.4 million**, based on the balance sheet position at September 30, 2023[147](index=147&type=chunk) - Inflation affects manufacturing costs, and the Company may not be able to fully offset higher costs through price increases or efficiencies. Foreign exchange risk is **limited**, and **no hedging strategies** are utilized[148](index=148&type=chunk)[149](index=149&type=chunk) [Item 4. Controls and Procedures](index=31&type=section&id=Item%204.%20Controls%20and%20Procedures) This section details the evaluation of the Company's disclosure controls and procedures and reports on any changes in internal control over financial reporting - The principal executive officer and principal financial officer concluded that the Company's **disclosure controls and procedures were effective** at a reasonable assurance level as of September 30, 2023[150](index=150&type=chunk) - There were **no material changes** in the Company's internal control over financial reporting during the three months ended September 30, 2023[151](index=151&type=chunk) [PART II — OTHER INFORMATION](index=32&type=section&id=PART%20II%20%E2%80%94%20OTHER%20INFORMATION) This section contains additional information not included in the financial statements, such as legal proceedings and risk factors [Item 1. Legal Proceedings](index=32&type=section&id=Item%201.%20Legal%20Proceedings) This section confirms the Company's current status regarding legal proceedings - The Company is **not currently a party to any material legal proceedings**[153](index=153&type=chunk) [Item 1A. Risk Factors](index=32&type=section&id=Item%201A.%20Risk%20Factors) This section refers to the Company's risk factors as previously disclosed - There have been **no material changes** to the risk factors described in the Company's 2022 Annual Report on Form 10-K[154](index=154&type=chunk) [Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities](index=32&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities,%20Use%20of%20Proceeds,%20and%20Issuer%20Purchases%20of%20Equity%20Securities) This section reports on any unregistered sales of equity securities, use of proceeds, and issuer purchases of equity securities - The Company did not have any **unregistered sales of equity securities** or **issuer purchases of equity securities** during the three months ended September 30, 2023[155](index=155&type=chunk)[156](index=156&type=chunk) [Item 3. Defaults Upon Senior Securities](index=32&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This section addresses any defaults upon senior securities - This item is **not applicable** to the Company[157](index=157&type=chunk) [Item 4. Mine Safety Disclosures](index=32&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section provides mine safety disclosures - This item is **not applicable** to the Company[158](index=158&type=chunk) [Item 5. Other Information](index=32&type=section&id=Item%205.%20Other%20Information) This section covers other information not disclosed elsewhere - This item is **not applicable** to the Company[159](index=159&type=chunk) [Item 6. Exhibits](index=33&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed as part of the Quarterly Report on Form 10-Q Exhibit Index Highlights | Exhibit Number | Exhibit Description | Filed Herewith | | :------------- | :------------------------------------------------------------------------------- | :------------- | | 10.1+ | Letter Agreement with Thomas Teisseyre, Ph.D. (July 17, 2023) | | | 10.4+ | Separation Agreement with Khan Siddiqui, M.D. (September 30, 2023) | | | 31.1 | Certification of the Principal Executive Officer pursuant to Section 302 | X | | 31.2 | Certification of the Principal Financial Officer pursuant to Section 302 | X | | 32* | Certifications of CEO and CFO pursuant to Section 906 | X | [Signatures](index=35&type=section&id=SIGNATURES) This section provides the official signatures for the Quarterly Report on Form 10-Q - The report was signed on **November 9, 2023**, by **Maria Sainz**, **President and Chief Executive Officer**, and **Brett Hale**, **Chief Administrative Officer, Chief Financial Officer, Treasurer and Corporate Secretary**[166](index=166&type=chunk)