Financial Data and Key Metrics Changes - Lifeward reported revenue of $6.2 million in Q3 2025, a slight increase of approximately 1.1% from $6.1 million in Q3 2024, and an 8% increase from $5.7 million in Q2 2025 [6][7] - GAAP gross profit for Q3 2025 was $2.7 million, or 43.7% of revenue, compared to $2.2 million, or 36.2% of revenue in Q3 2024, driven by lower production costs [9][10] - GAAP operating loss for Q3 2025 was $3.1 million, a slight improvement from $3.2 million in Q3 2024, while non-GAAP operating loss was $3 million compared to $4.1 million in the same period last year [11][12] Business Line Data and Key Metrics Changes - Revenue from traditional products, including ReWalk, MyoCycle, and ReStore, totaled $3.1 million in Q3 2025, up 24% from $2.5 million in Q3 2024, driven by increased Medicare-related sales [8] - Revenue from AlterG products decreased to $3.1 million in Q3 2025 from $3.6 million in Q3 2024, primarily due to timing factors [8] Market Data and Key Metrics Changes - Lifeward expanded patient access with the first Medicare Advantage commercial revenue for the ReWalk 7 personal exoskeleton and received CE mark approval, enhancing access to the European market, which represents about 40% of the global addressable exoskeleton opportunity [4][12] - The company closed the quarter with a pipeline of over 117 qualified leads for ReWalk in the U.S. and 49 leads in Germany, including 33 active rentals [8] Company Strategy and Development Direction - The company is focused on rebuilding fundamentals, defining strategic direction, and improving operational discipline, with a commitment to creating durable long-term value [3][5] - Lifeward is exploring global expansion opportunities and strategic partnerships to enhance financial position and market access [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing transformation and the potential for growth, emphasizing the importance of operational efficiencies and a focused sales approach [5][12] - The company reaffirmed its full-year 2025 guidance, expecting revenue in the range of $24-$26 million and a projected non-GAAP net loss of $12-$14 million [12] Other Important Information - Lifeward completed a $3 million loan agreement with AuraMed to enhance liquidity and support the transformation plan [4][12] - The company ended Q3 2025 with $2 million in cash and cash equivalents and no debt, indicating a stable financial position [11][12] Q&A Session Summary Question: Breakdown of rental systems for ReWalk - Lifeward confirmed that there are 33 active rentals, all in Germany [17] Question: Impact of collaboration with CoreLife - Management noted that the partnership with CoreLife is progressing well, with a growing pipeline and learning from training processes [19] Question: Percentage of revenue from Medicare - Medicare accounts for approximately 50% of total revenue, specifically for ReWalk products [21][24] Question: Revenue contribution from ReWalk within traditional product sales - Revenue from ReWalk products is approximately $2.9 million within the $3.1 million of traditional product sales [25] Question: Changes needed for AlterG to stabilize - Management indicated a need for a dedicated sales team for AlterG to regain focus and improve sales performance [38] Question: Introduction of ReWalk 7 in Germany - The company has a solid pipeline with 33 active rentals that are expected to convert to sales within three to six months [39] Question: Comfort level regarding financial stability - Management expressed optimism about the turnaround potential and the strength of the product portfolio, indicating a positive outlook for overcoming financial challenges [42]

Revenue Performance - Lifeward reported revenue of $6.2 million in Q3 2025, a slight increase of approximately 1% from $6.1 million in Q3 2024, and an 8% increase from $5.7 million in Q2 2025[5] - Revenue from traditional products, including ReWalk exoskeletons, increased by 24% year-over-year to $3.1 million, attributed to Medicare-related sales growth[5] - Revenue for Q3 2025 was $6,195 million, a slight increase from $6,128 million in Q3 2024, while total revenue for the nine months ended September 30, 2025, was $16,953 million, down from $18,118 million in the same period last year[23] Financial Losses and Improvements - Non-GAAP operating loss decreased to $3.0 million in Q3 2025, compared to a loss of $4.1 million in Q3 2024, representing a 27% improvement[7] - Operating loss for Q3 2025 was $(3,140) million, which is 50.7% of revenue, compared to $(3,174) million or 51.8% of revenue in Q3 2024[30] - Net loss for Q3 2025 was $(3,170) million, compared to $(3,084) million in Q3 2024, with a basic net loss per share of $(0.20) versus $(0.35) in the prior year[29] - Non-GAAP net loss for Q3 2025 was $(2,996) million, compared to $(3,960) million in Q3 2024, with a non-GAAP net loss per share of $(0.19) versus $(0.45) in the prior year[29] Cost Management and Efficiency - Quarterly cash burn improved to $3.8 million, down 16% year-over-year from $4.5 million in Q3 2024, reflecting operational efficiencies[4] - Operating expenses decreased to $5.7 million on a non-GAAP basis, down from $6.7 million in Q3 2024, reflecting improved efficiency in reimbursement activities[6] - Gross margin increased to 43.7% in Q3 2025, up from 36.2% in Q3 2024, driven by lower production costs following the closure of the Fremont facility[5] Cash Flow and Assets - Cash and cash equivalents at the end of Q3 2025 were $1,956 million, a decrease from $6,746 million at the end of December 2024[25] - Total assets as of September 30, 2025, were $23,168 million, down from $30,487 million at the end of December 2024[25] - The company reported net cash used in operating activities of $(13,271) million for the nine months ended September 30, 2025, compared to $(17,749) million in the same period of 2024[27] - The company experienced a decrease in cash, cash equivalents, and restricted cash of $(4,748) million for the nine months ended September 30, 2025, compared to $(17,778) million in the same period of 2024[27] Research and Development Expenses - Research and development expenses for Q3 2025 were $721 million, down from $998 million in Q3 2024, while sales and marketing expenses decreased to $3,168 million from $4,156 million[23] - GAAP research and development expenses for Q3 2025 were $721,000, representing 11.6% of revenue, compared to $998,000 (16.3%) in Q3 2024[31] - Non-GAAP research and development expenses for Q3 2025 were $689,000, or 11.1% of revenue, down from $960,000 (15.7%) in Q3 2024[31] General and Administrative Expenses - GAAP general and administrative expenses for Q3 2025 were $1,958,000, representing 31.6% of revenue, compared to $240,000 (3.9%) in Q3 2024[31] - Non-GAAP general and administrative expenses for Q3 2025 were $1,884,000, or 30.4% of revenue, compared to $2,024,000 (33.0%) in Q3 2024[31] - The company reported a significant increase in GAAP general and administrative expenses for the nine months ended September 30, 2025, totaling $5,917,000 (34.9%) compared to $3,424,000 (18.9%) in the same period of 2024[31] Strategic Initiatives - The company secured a $3.0 million loan from Oramed Ltd. to support ongoing operations and strategic initiatives[4] - Lifeward reaffirmed its full-year 2025 revenue guidance, expecting revenue in the range of $24 to $26 million and a projected non-GAAP net loss of $12 to $14 million[11] - The company received CE mark approval for the ReWalk 7 Personal Exoskeleton, enabling commercial sales in Europe, which currently accounts for approximately 40% of exoskeleton sales[4] Stock-Based Compensation - Stock-based compensation expenses for Q3 2025 were $74,000 (1.2%) compared to $158,000 (2.6%) in Q3 2024[31]

Core Insights - Lifeward Ltd. reported a record quarter for Medicare beneficiary placements, indicating strong commercial execution and operational improvements [3][9] - The company achieved a 16% year-over-year decrease in quarterly cash burn and a 27% decrease in quarterly Non-GAAP operating loss, reflecting ongoing efficiency initiatives [4][6] - Lifeward secured a $3.0 million loan agreement with Oramed Ltd. to support its operations and strategic initiatives [9][10] Financial Performance - Revenue for Q3 2025 was $6.2 million, a slight increase of approximately 1% from $6.1 million in Q3 2024, and an 8% increase from $5.7 million in Q2 2025 [4] - Revenue from traditional products, including ReWalk Personal exoskeletons, rose to $3.1 million, up 24% year-over-year, driven by Medicare-related sales [4] - Gross margin improved to 43.7% in Q3 2025, compared to 36.2% in Q3 2024, primarily due to lower production costs following the closure of the Fremont manufacturing facility [4][5] Operating Expenses and Losses - Total operating expenses in Q3 2025 were $5.9 million, up from $5.4 million in Q3 2024, but adjusted operating expenses decreased to $5.7 million from $6.7 million year-over-year [5] - The operating loss for Q3 2025 was $3.1 million, slightly improved from a loss of $3.2 million in Q3 2024, with adjusted operating loss decreasing to $3.0 million from $4.1 million [6] - Net loss for Q3 2025 was $3.2 million, or $0.20 per share, compared to a net loss of $3.1 million, or $0.35 per share, in Q3 2024 [7] Liquidity and Guidance - As of September 30, 2025, Lifeward had $2.0 million in unrestricted cash and cash equivalents, with cash used in operations improving to $3.8 million from $4.5 million in Q3 2024 [8] - The company reaffirmed its full-year 2025 guidance, expecting revenue in the range of $24 to $26 million and a projected non-GAAP net loss between $12 to $14 million [11]

Core Viewpoint - Lifeward Ltd. will release its third quarter 2025 financial results on November 14, 2025, before market opening [1] Group 1: Financial Results Announcement - The financial results will be discussed in a conference call and live webcast hosted by the President and CEO, Mark Grant, and CFO, Almog Adar, at 8:30 a.m. EST on the same day [2] - Analysts and investors can access the call through various toll-free numbers and an access code referencing "Lifeward Earnings Call" [2] Group 2: Company Overview - Lifeward is a global leader in innovative medical technology aimed at transforming the lives of individuals with physical limitations or disabilities [1][3] - The company designs, develops, and commercializes solutions that provide functional and health benefits in both clinical and home settings [3] - Lifeward's product portfolio includes the ReWalk Exoskeleton, AlterG Anti-Gravity system, MyoCycle FES System, and ReStore Exo-Suit [3] Group 3: Company Background - Founded in 2001, Lifeward operates in the United States, Israel, and Germany [4] - The company's mission is to drive innovation to empower individuals with physical limitations [3][4]

Group 1 - Chengdu's humanoid robot innovation center has developed the first domestic robot task execution system (R-WMES) based on a world model, marking a significant milestone in intelligent humanoid robot capabilities [2] - The world model framework mimics human brain thinking by learning physical and causal laws from the real world, enabling robots to autonomously plan and execute tasks based on target images [2] - The R-WMES system demonstrates strong adaptability and task completion in unfamiliar environments, addressing the intelligence gap in humanoid robots and accelerating their practical and commercial application [2] Group 2 - The Ministry of Industry and Information Technology (MIIT) stated that China has established a complete manufacturing capability for humanoid robots, covering key chips, components, and complete machines [5] - Since the 14th Five-Year Plan, 46 cities have been supported in new technology transformation pilot projects, resulting in over 230 excellent smart factories and 1,260 5G factories [5] - China's industrial robot installation accounted for over 50% of the global total, with significant improvements in energy consumption efficiency for products like steel and cement [5] Group 3 - Xingyuan Intelligent, a company focused on embodied intelligence, has completed a 200 million RMB angel round of financing to accelerate the development and commercialization of its embodied brain technology [6] - The company was incubated by the Beijing Academy of Artificial Intelligence and aims to create a universal embodied brain for the physical world, leveraging a team of top talents in the field [6] - The founding team includes experienced professionals from leading companies, establishing a closed-loop ecosystem of "technical barriers + commercial realization" [6] Group 4 - The Swiss Federal Institute of Technology Zurich has proposed an innovative control framework for legged robots that combines reinforcement learning and multi-head attention mechanisms, enabling precise control and 100% success in obstacle navigation [11] - This method enhances the robot's adaptability to complex terrains by dynamically adjusting its focus based on real-time motion states and environmental data [11] - Both GR-1 and ANYmal-D robots have shown excellent performance in experimental and real-world environments, opening up new possibilities for practical applications [11] Group 5 - Lifeward's seventh-generation personal exoskeleton, ReWalk 7, has received CE certification for the European market, marking a significant milestone in medical device innovation for spinal cord injury rehabilitation [12] - ReWalk 7 features cloud connectivity, allowing users to control the device and track usage data through a smartwatch and mobile app, enabling personalized rehabilitation goals [12] - The new system supports seamless transitions between indoor and outdoor environments and includes one-click activation for stairs and sidewalks, enhancing user independence [12]

Core Insights - Lifeward Ltd. (LFWD) has received CE mark approval for the ReWalk 7 Personal Exoskeleton, allowing for commercial sale in Europe, which constitutes approximately 40% of the company's exoskeleton sales [1][7] - The ReWalk 7 features enhancements such as cloud connectivity, push-button control, customizable walking speeds, and the ability to navigate stairs and curbs, making it unique in the market [2][7] - The company has established supply contracts with major insurance carriers in Germany, covering about 45% of individuals with statutory health insurance, facilitating reimbursement for the exoskeletons [3] Financial Performance - Following the CE approval announcement, Lifeward's shares rose by 2.2% in after-market trading, although the stock has declined by 68.9% year-to-date, contrasting with a 20.4% growth in the industry and a 10.8% gain in the S&P 500 [4] - The recent approvals and improved cash burn rate due to operational efficiencies may positively impact future revenues and share price [5] Product Development and Manufacturing - The ReWalk 7 was launched in the U.S. in April, with over 20 units installed, marking the highest quarterly total for Medicare beneficiaries since the fee schedule was established [8] - The company transitioned to in-house manufacturing of the ReWalk, resulting in cost savings, improved quality control, and greater production flexibility [9] Research and Partnerships - Lifeward concluded a research program under the Israel Innovation Authority's MAGNET incentive program, demonstrating a proof-of-concept prototype integrating AI for autonomous decision-making in future ReWalk models [10] - The company expanded its partnership with SportsMed Products Ltd. for distributing its AlterG product portfolio in the UAE and the Gulf Cooperation Council [11]

Core Insights - Lifeward Ltd. has made significant progress in securing Medicare reimbursement for its ReWalk 7 Personal Exoskeleton, marking a milestone in expanding access for individuals with spinal cord injuries [1][2] - The company has successfully received its first payment from a commercial Medicare Advantage Plan, indicating a growing acceptance of its innovative medical technology [1][2] - The Centers for Medicare & Medicaid Services (CMS) has established a reimbursement pathway for personal exoskeletons, which has streamlined the claims process, allowing for quicker approvals and payments [2] Company Overview - Lifeward is a leader in medical technology focused on transforming the lives of individuals with physical limitations or disabilities, with a mission to drive innovation in rehabilitation and recovery [3] - The company's product portfolio includes the ReWalk Exoskeleton, AlterG Anti-Gravity System, ReStore Exo-Suit, and MyoCycle FES System, showcasing its commitment to delivering groundbreaking solutions [3] - Founded in 2001, Lifeward operates in the United States, Israel, and Germany, emphasizing its global reach and impact in the healthcare sector [3]

Core Viewpoint - Lifeward Ltd. has received CE mark approval for the ReWalk 7 Personal Exoskeleton, allowing for its commercial sale in the European Union, which is expected to drive revenue growth and market adoption in Europe [1][2]. Company Overview - Lifeward is a global leader in innovative medical technology aimed at transforming the lives of individuals with physical limitations or disabilities, with a mission to drive innovation in rehabilitation and recovery [3]. - The company has a diverse portfolio that includes the ReWalk Exoskeleton, AlterG Anti-Gravity System, ReStore Exo-Suit, and MyoCycle FES System, and operates in the United States, Israel, and Germany [3]. Product Details - The ReWalk 7 features advancements such as cloud connectivity, push-button control, customizable walking speeds, and seamless activation for stairs and curbs, enhancing user experience for individuals with spinal cord injuries [2]. - The European market, particularly Germany, is significant for Lifeward, representing approximately 40% of its exoskeleton sales, with established reimbursement processes for personal exoskeletons [1][2]. Market Position - Lifeward GmbH serves as the primary sales force in Europe, with Germany being the second largest market for ReWalk personal exoskeletons globally [2]. - The company has established supply contracts with major insurance carriers in Germany, facilitating reimbursement for about 45% of individuals with statutory health insurance coverage [2].

Company Performance - Lifeward reported a quarterly loss of $0.58 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.25, and compared to a loss of $0.50 per share a year ago [1][2] - The company's revenues for the quarter ended June 2025 were $5.72 million, missing the Zacks Consensus Estimate by 11.53%, and down from $6.71 million in the same quarter last year [3] - Lifeward has not surpassed consensus EPS estimates in the last four quarters and has only topped revenue estimates once during that period [2][3] Stock Performance - Lifeward shares have declined approximately 58.6% since the beginning of the year, contrasting with a 10% gain in the S&P 500 [4] - The current Zacks Rank for Lifeward is 3 (Hold), indicating that the stock is expected to perform in line with the market in the near future [7] Earnings Outlook - The consensus EPS estimate for the upcoming quarter is -$0.14 on revenues of $7.77 million, and for the current fiscal year, it is -$0.77 on revenues of $29.02 million [8] - The trend of estimate revisions for Lifeward was mixed ahead of the earnings release, which could change following the recent report [7] Industry Context - Lifeward operates within the Zacks Internet - Software industry, which is currently ranked in the top 30% of over 250 Zacks industries, suggesting a favorable industry outlook [9] - The performance of Lifeward's stock may be influenced by the overall outlook for the industry [9]

PART I - FINANCIAL INFORMATION [ITEM 1. FINANCIAL STATEMENTS](index=6&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS) This section presents the unaudited condensed consolidated financial statements for the six months ended June 30, 2025, with accompanying notes [Condensed Consolidated Balance Sheets](index=6&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) Condensed Consolidated Balance Sheets (in thousands) | Metric | June 30, 2025 (unaudited) | December 31, 2024 | | :--- | :--- | :--- | | **ASSETS** | | | | Cash and cash equivalents | $5,139 | $6,746 | | Total current assets | $20,710 | $21,294 | | Goodwill | $4,755 | $7,538 | | Total assets | $26,777 | $30,487 | | **LIABILITIES AND SHAREHOLDERS' EQUITY** | | | | Total current liabilities | $10,360 | $10,225 | | Total liabilities | $11,667 | $11,638 | | Total shareholders' equity | $15,110 | $18,849 | | Total liabilities and shareholders' equity | $26,777 | $30,487 | [Condensed Consolidated Statements of Operations](index=8&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) Condensed Consolidated Statements of Operations (in thousands, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Revenues | $5,724 | $6,707 | $10,758 | $11,990 | | Gross profit | $2,511 | $2,757 | $4,633 | $4,152 | | Operating loss | $(6,563) | $(4,443) | $(11,416) | $(10,945) | | Net loss | $(6,562) | $(4,304) | $(11,396) | $(10,580) | | Net loss per ordinary share, basic and diluted | $(0.58) | $(0.50) | $(1.05) | $(1.23) | [Condensed Statements of Changes in Shareholders' Equity](index=9&type=section&id=CONDENSED%20STATEMENTS%20OF%20CHANGES%20IN%20SHAREHOLDERS'%20EQUITY) Changes in Shareholders' Equity (in thousands, except share data) | Metric | Balance as of Dec 31, 2024 | Share-based compensation | Issuance of ordinary shares (various) | Net loss | Balance as of June 30, 2025 | | :--- | :--- | :--- | :--- | :--- | :--- | | Ordinary Shares Number | 8,808,143 | - | 6,842,587 | - | 15,658,730 | | Ordinary Shares Amount | $4,590 | - | $3,435 | - | $8,025 | | Additional paid-in capital | $282,287 | $402 | $3,865 | - | $286,509 | | Accumulated deficit | $(264,825) | - | - | $(11,396) | $(276,221) | | Total shareholders' equity | $18,849 | $402 | $6,233 | $(11,396) | $15,110 | - The Company completed a **one-for-seven reverse share split** effective March 15, 2024, retroactively adjusting all share and per share data[25](index=25&type=chunk)[91](index=91&type=chunk) - Significant equity raises occurred through an at-the-market offering and a public offering, contributing to an increase in ordinary shares and additional paid-in capital[24](index=24&type=chunk)[104](index=104&type=chunk)[108](index=108&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=11&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) Condensed Consolidated Statements of Cash Flows (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(9,429) | $(13,290) | | Net cash used in investing activities | $(5) | $0 | | Net cash provided by financing activities | $7,779 | $0 | | Decrease in cash, cash equivalents, and restricted cash | $(1,585) | $(13,305) | | Cash, cash equivalents, and restricted cash at end of period | $5,523 | $15,487 | [Notes to Condensed Consolidated Financial Statements](index=12&type=section&id=NOTES%20TO%20CONDENSED%20CONSOLIDATED%20FINANCIAL%20STATEMENTS) [Note 1: General](index=12&type=section&id=NOTE%201%3A%20GENERAL) - Lifeward Ltd (formerly ReWalk Robotics Ltd) is a medical device company focused on rehabilitation and recovery solutions, including ReWalk Exoskeletons, ReStore Exo-Suit, MYOLYN MyoCycle FES Pro cycles, and AlterG Anti-Gravity systems[31](index=31&type=chunk) - The Company incurred a consolidated net loss of **$11.4 million** and had an accumulated deficit of **$276.2 million** as of June 30, 2025, with cash and cash equivalents totaling **$5.1 million** and negative operating cash flow of **$9.4 million** for the six months ended June 30, 2025; these conditions raise **substantial doubt** about the Company's ability to continue as a going concern[32](index=32&type=chunk) [Note 2: Basis of Presentation and Summary of Estimates](index=13&type=section&id=NOTE%202%3A%20BASIS%20OF%20PRESENTATION%20AND%20SUMMARY%20OF%20ESTIMATES) - The unaudited condensed consolidated financial statements are prepared in accordance with U.S GAAP, reflecting normal recurring adjustments for interim periods and should be read with the 2024 Form 10-K[34](index=34&type=chunk)[35](index=35&type=chunk) - Management's estimates, judgments, and assumptions are crucial for financial reporting, particularly for inventories, business combinations, revenue recognition, share-based awards, and contingent liabilities, with actual results potentially differing[36](index=36&type=chunk)[37](index=37&type=chunk) [Note 3: Significant Accounting Policies](index=15&type=section&id=NOTE%203%3A%20SIGNIFICANT%20ACCOUNTING%20POLICIES) [3a. Fair Value Measurements](index=15&type=section&id=3a.%20Fair%20Value%20Measurements) Fair Value Measurements (in thousands) | Description | Fair Value Hierarchy | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | :--- | | Money market funds (cash equivalents) | Level 1 | $1,113 | $2,697 | | Earnout liability | Level 3 | $0 | $608 | - The earnout liability, initially estimated at **$3.6 million** at acquisition, was eliminated as of June 30, 2025, because performance targets for the remaining earnout period were not met[44](index=44&type=chunk)[45](index=45&type=chunk) [3b. Revenue Recognition](index=16&type=section&id=3b.%20Revenue%20Recognition) Disaggregation of Revenues (in thousands) | Revenue Type | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Product | $4,561 | $5,128 | $8,287 | $8,867 | | Lease | $428 | $882 | $888 | $1,768 | | Service and warranty | $735 | $697 | $1,583 | $1,355 | | Total Revenues | $5,724 | $6,707 | $10,758 | $11,990 | - Revenue is generated from product sales (ReWalk, AlterG, ReStore, MyoCycle), leases (AlterG Anti-Gravity systems, SCI Products rent-to-purchase), and service/warranty contracts[46](index=46&type=chunk)[51](index=51&type=chunk)[57](index=57&type=chunk)[58](index=58&type=chunk) - Deferred revenues, primarily from service-type warranty obligations and multi-year service contracts, amounted to **$2.343 million** as of June 30, 2025, with **$0.9 million** recognized during the six months ended June 30, 2025[64](index=64&type=chunk)[65](index=65&type=chunk)[66](index=66&type=chunk) [3c. Concentrations of Credit Risks](index=20&type=section&id=3c.%20Concentrations%20of%20Credit%20Risks) Customer A Credit Concentration | Customer | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Customer A | 43% | 40% | - Allowance for credit losses was **$0.2 million** as of June 30, 2025, and December 31, 2024; provisions for doubtful accounts were **$0.3 million** for Q2 2025 and **$0.6 million** for H1 2025[67](index=67&type=chunk)[68](index=68&type=chunk) [3d. Warranty provision](index=20&type=section&id=3d.%20Warranty%20provision) Warranty Provision Activity (in thousands) | Metric | US Dollars in thousands | | :--- | :--- | | Balance at December 31, 2024 | $392 | | Provision | $281 | | Usage | $(327) | | Balance at June 30, 2025 | $346 | - The Company records a provision for estimated warranty costs at the time of sale for assurance-type warranties, with factors including units sold, historical repair rates, and cost per repair[69](index=69&type=chunk) [3e. Basic and diluted net loss per ordinary share](index=20&type=section&id=3e.%20Basic%20and%20diluted%20net%20loss%20per%20ordinary%20share) - Basic and diluted net loss per share were identical for all periods presented because the inclusion of potential ordinary shares and warrants would have been **anti-dilutive**[71](index=71&type=chunk)[72](index=72&type=chunk) [3f. Goodwill and acquired intangible assets](index=20&type=section&id=3f.%20Goodwill%20and%20acquired%20intangible%20assets) - Goodwill is tested for impairment annually or more frequently if indicators are present; the Company recorded a goodwill impairment of **$2.8 million** during Q2 2025 due to a decline in its stock price, making its market capitalization less than the carrying value of its reporting unit[74](index=74&type=chunk)[79](index=79&type=chunk) [3h. Restricted cash and Other long-term assets](index=21&type=section&id=3h.%20Restricted%20cash%20and%20Other%20long-term%20assets) - Other long-term assets include long-term prepaid expenses and restricted cash deposits for offices and car leasing, based on the remaining restriction term[75](index=75&type=chunk) [3i. New Accounting Pronouncements](index=22&type=section&id=3i.%20New%20Accounting%20Pronouncements) - The Company is evaluating the impact of ASU 2023-09 (Income Taxes - Improvements to Income Tax Disclosures) effective for fiscal years after December 15, 2024, and ASU 2024-03 (Expense Disaggregation Disclosures) effective for fiscal years after December 15, 2026[77](index=77&type=chunk) - ASU 2025-05 (Financial Instruments - Credit Losses) introduces a practical expedient for CECL model application to accounts receivable and contract assets, effective for fiscal years after December 15, 2025, and is currently being evaluated for adoption timing and impact[77](index=77&type=chunk) [Note 4: Inventories](index=22&type=section&id=NOTE%204%3A%20INVENTORIES) Inventories Components (in thousands) | Component | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Finished products | $3,041 | $3,580 | | Work in progress | $425 | $0 | | Raw materials | $4,156 | $3,143 | | Total | $7,622 | $6,723 | [Note 5: Goodwill and Other Intangible Assets, Net](index=23&type=section&id=NOTE%205%3A%20GOODWILL%20AND%20OTHER%20INTANGIBLE%20ASSETS%2C%20NET) Changes in Goodwill Carrying Amount (in thousands) | Metric | US Dollars in thousands | | :--- | :--- | | Balance as of December 31, 2024 | $7,538 | | Goodwill impairment | $(2,783) | | Balance as of June 30, 2025 | $4,755 | - A goodwill impairment charge of **$2.8 million** was recorded in Q2 2025 due to a sustained decline in the Company's stock price, indicating its market capitalization was below its carrying value[78](index=78&type=chunk)[79](index=79&type=chunk) - The carrying amounts of intangible assets were **fully impaired** as of December 31, 2024, and no impairment charges were recorded for long-lived assets during the periods presented[80](index=80&type=chunk)[81](index=81&type=chunk) [Note 6: Commitments and Contingent Liabilities](index=23&type=section&id=NOTE%206%3A%20COMMITMENTS%20AND%20CONTINGENT%20LIABILITIES) [6a. Purchase commitments](index=23&type=section&id=6a.%20Purchase%20commitments) - As of June 30, 2025, non-cancelable outstanding purchase obligations amounted to approximately **$7.4 million**[82](index=82&type=chunk) [6b. Operating lease commitment](index=24&type=section&id=6b.%20Operating%20lease%20commitment) Future Lease Payments (in thousands) | Year | Amount | | :--- | :--- | | 2025 | $264 | | 2026 | $76 | | 2027 | $53 | | 2028 | $12 | | Total lease payments | $405 | | Present value of future lease payments | $375 | | Non-current operating leases | $79 | - Operating lease expense was **$0.2 million** for Q2 2025 (down from $0.3 million in Q2 2024) and **$0.4 million** for H1 2025 (down from $0.7 million in H1 2024)[83](index=83&type=chunk) [6c. Royalties](index=24&type=section&id=6c.%20Royalties) - The Company has received **$2.8 million** in funding from the Israel Innovation Authority (IIA) since inception, with **$1.6 million** being royalty-bearing grants; a contingent liability of **$1.6 million** to the IIA remains as of June 30, 2025[84](index=84&type=chunk)[86](index=86&type=chunk) - Royalty expenses in cost of revenue were **$8 thousand** for Q2 2025 and **$2 thousand** for H1 2025[85](index=85&type=chunk) [6d. Liens](index=25&type=section&id=6d.%20Liens) - An amount of **$0.4 million** from other long-term assets and restricted cash has been pledged as security for a third-party guarantee[89](index=89&type=chunk) [6e. Legal Claims](index=25&type=section&id=6e.%20Legal%20Claims) - The Company is occasionally involved in various claims, including product liability lawsuits and regulatory examinations, with outcomes inherently uncertain and potentially material to financial results[89](index=89&type=chunk) [Note 7: Shareholders' Equity](index=26&type=section&id=NOTE%207%3A%20SHAREHOLDERS'%20EQUITY) [7a. Reverse share split](index=26&type=section&id=7a.%20Reverse%20share%20split) - A **one-for-seven reverse share split** became effective on March 15, 2024, reducing outstanding ordinary shares from approximately 60.1 million to 8.6 million, with retroactive effect on all share and per share data[91](index=91&type=chunk) [7b. Share option plans](index=26&type=section&id=7b.%20Share%20option%20plans) - The 2014 Incentive Compensation Plan was terminated on August 19, 2024, with no ordinary shares reserved as of June 30, 2025; a new 2025 Incentive Compensation Plan was approved on August 1, 2025[92](index=92&type=chunk)[94](index=94&type=chunk) Employee Share Options Activity (Six Months Ended June 30, 2025) | Metric | Number | Weighted average exercise price | | :--- | :--- | :--- | | Options outstanding as of Dec 31, 2024 | 4,573 | $187.94 | | Granted | 400,000 | $1.23 | | Forfeited | (22) | $500.74 | | Options outstanding as of June 30, 2025 | 404,551 | $3.31 | | Options exercisable as of June 30, 2025 | 4,551 | $186.43 | Employee and Non-Employee RSUs Activity (Six Months Ended June 30, 2025) | Metric | Number of shares underlying outstanding RSUs | Weighted average grant date fair value | | :--- | :--- | :--- | | Unvested RSUs as of Dec 31, 2024 | 327,243 | $5.68 | | Vested | (68,286) | $5.84 | | Forfeited | (25,629) | $4.96 | | Unvested RSUs as of June 30, 2025 | 233,328 | $5.72 | - Total unrecognized compensation costs related to non-vested share-based compensation were **$1.3 million** as of June 30, 2025, expected to be recognized over approximately **3.93 years**[99](index=99&type=chunk) [7c. Share-based awards to non-employee consultants](index=28&type=section&id=7c.%20Share-based%20awards%20to%20non-employee%20consultants) - As of June 30, 2025, there were **no outstanding options or RSUs** held by non-employee consultants[100](index=100&type=chunk) [7d. Share-based compensation expense for employees and non-employees](index=28&type=section&id=7d.%20Share-based%20compensation%20expense%20for%20employees%20and%20non-employees) Share-Based Compensation Expense (in thousands) | Category | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Cost of revenues | $7 | $9 | | Research and development, net | $73 | $92 | | Sales and marketing | $138 | $218 | | General and administrative | $184 | $438 | | Total | $402 | $757 | [7e. Warrants to purchase ordinary shares](index=29&type=section&id=7e.%20Warrants%20to%20purchase%20ordinary%20shares) Warrants Outstanding and Exercisable (as of June 30, 2025) | Issuance Date | Warrants Outstanding (number) | Exercise Price per Warrant | Contractual Term | | :--- | :--- | :--- | :--- | | December 31, 2015 | 681 | $52.50 | Until Dec 30, 2025 | | December 28, 2016 | 272 | $52.50 | Until Dec 30, 2025 | | July 6, 2020 | 64,099 | $12.32 | January 2, 2026 | | July 6, 2020 | 42,326 | $15.95 | July 2, 2025 | | December 8, 2020 | 83,821 | $9.38 | June 8, 2026 | | December 8, 2020 | 15,543 | $12.55 | June 8, 2026 | | February 26, 2021 | 780,095 | $25.20 | August 26, 2026 | | February 26, 2021 | 93,612 | $32.05 | August 26, 2026 | | September 29, 2021 | 1,143,821 | $14.00 | March 29, 2027 | | September 29, 2021 | 137,257 | $17.81 | September 27, 2026 | | January 8, 2025 | 1,818,183 | $2.75 | January 10, 2028 | | January 8, 2025 | 109,091 | $3.44 | January 10, 2028 | | June 26, 2025 | 4,000,000 | $0.65 | June 26, 2030 | | June 26, 2025 | 240,000 | $0.81 | June 25, 2030 | | Total | 8,528,801 | | | [7f. Equity raise](index=30&type=section&id=7f.%20Equity%20raise) - In January 2025, the Company issued **1,818,183 ordinary shares** and warrants to institutional investors at **$2.75 per share**, raising capital through a registered direct offering and concurrent private placement[103](index=103&type=chunk) - An At-the-Market (ATM) Offering Agreement was established in March 2025, allowing the sale of up to **$5.5 million** in ordinary shares; during Q2 2025, **964,118 shares** were sold under the ATM program for net proceeds of approximately **$1.0 million**[104](index=104&type=chunk)[105](index=105&type=chunk)[106](index=106&type=chunk) - In June 2025, the Company completed a public offering of **4,000,000 ordinary shares** and warrants at **$0.65 per share**, with additional warrants issued to the placement agent[108](index=108&type=chunk) [Note 8: Financial Income, Net](index=32&type=section&id=NOTE%208%3A%20FINANCIAL%20INCOME%2C%20NET) Financial Income, Net (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Foreign currency transactions and other | $(25) | $(14) | $(20) | $(37) | | Interest Income | $65 | $196 | $121 | $484 | | Bank commissions | $(39) | $(38) | $(70) | $(71) | | Total Financial income, net | $1 | $144 | $31 | $376 | [Note 9: Geographic Information and Major Customer and Product Data](index=32&type=section&id=NOTE%209%3A%20GEOGRAPHIC%20INFORMATION%20AND%20MAJOR%20CUSTOMER%20AND%20PRODUCT%20DATA) Revenues by Geographic Area (in thousands) | Region | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | United States | $3,062 | $3,849 | $6,271 | $7,596 | | Europe | $2,103 | $2,308 | $3,439 | $3,477 | | Asia-Pacific | $124 | $214 | $166 | $394 | | Rest of the world | $435 | $336 | $882 | $523 | | Total revenues | $5,724 | $6,707 | $10,758 | $11,990 | Long-Lived Assets by Geographic Region (in thousands) | Region | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Israel | $294 | $359 | | United States | $744 | $947 | | Germany | $46 | $109 | | Total | $1,084 | $1,415 | Major Customer Data as a Percentage of Total Revenues | Customer | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Customer A | 15% | 23% | [Note 10: Subsequent Event](index=33&type=section&id=NOTE%2010%3A%20SUBSEQUENT%20EVENT) - On July 4, 2025, the One Big Beautiful Bill Act (OBBBA) was signed into law, including changes to U.S federal tax law, which the Company is currently assessing for its impact on consolidated financial statements[116](index=116&type=chunk) [ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](index=34&type=section&id=ITEM%202.%20MANAGEMENT'S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) Management discusses the company's financial condition and operational results for the six months ended June 30, 2025 [Overview](index=34&type=section&id=Overview) - Lifeward is a medical device company commercializing life-changing solutions for physical rehabilitation, including ReWalk Personal and Rehabilitation Exoskeletons, ReStore Exo-Suit, MYOLYN MyoCycle FES Pro cycles, and AlterG Anti-Gravity systems[118](index=118&type=chunk)[119](index=119&type=chunk)[120](index=120&type=chunk) - Key developments include FDA clearance for ReWalk Personal Exoskeleton with stair and curb functionality (March 2023), submission of 510(k) for ReWalk 7 (June 2024), and an ALJ ruling in favor of **Medicare coverage** for ReWalk Personal Exoskeleton (June 2025)[118](index=118&type=chunk) - The Company acquired AlterG in August 2023 for approximately **$19 million cash**, expanding its product offerings in anti-gravity systems for rehabilitation[120](index=120&type=chunk) - A partnership with CorLife, LLC (a division of Numotion) was announced in March 2025 to exclusively distribute the ReWalk Personal Exoskeleton in the workers' compensation market[121](index=121&type=chunk) - CMS confirmed in November 2023 that personal exoskeletons are included in the Medicare brace benefit category, with a final lump-sum Medicare purchase fee schedule amount of **$91,032** established in April 2024 for HCPCS code K1007[126](index=126&type=chunk)[127](index=127&type=chunk) [Second Quarter 2025 Business Highlights](index=37&type=section&id=Second%20Quarter%202025%20Business%20Highlights) - Achieved **FDA clearance and U.S. launch of ReWalk 7** in April 2025, with over 20 units installed and positive customer feedback[133](index=133&type=chunk) - Expanded qualified leads for ReWalk and achieved the **highest quarterly total of ReWalk units placed for Medicare beneficiaries** since the fee schedule was established[133](index=133&type=chunk) - Improved quarterly cash burn to **$3.9 million** (down from $5.6 million in Q2 2024 and $5.5 million in Q1 2025) due to operational efficiencies and cost reduction initiatives[133](index=133&type=chunk) - Successfully transitioned to **in-house manufacturing** of ReWalk Personal Exoskeleton during Q2, terminating the agreement with Sanmina, leading to cost savings and improved quality control[133](index=133&type=chunk) - Strengthened executive leadership with the appointment of Mark Grant as President and CEO and Almog Adar as CFO[133](index=133&type=chunk) [Three and Six Months Ended June 30, 2025 Compared to Three and Six Months Ended June 30, 2024](index=38&type=section&id=Three%20and%20Six%20Months%20Ended%20June%2030%2C%202025%20Compared%20to%20Three%20and%20Six%20Months%20Ended%20June%2030%2C%202024) [Revenue](index=38&type=section&id=Revenue) Revenue (in thousands) | Period | 2025 | 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Three Months Ended June 30 | $5,724 | $6,707 | $(983) | -14.7% | | Six Months Ended June 30 | $10,758 | $11,990 | $(1,232) | -10.3% | - The decrease in revenue was primarily due to one-time Medicare-related revenue recognized in Q2 2024 for prior period claims and lower sales volume of MyoCycle units[135](index=135&type=chunk)[136](index=136&type=chunk) [Gross Profit](index=38&type=section&id=Gross%20Profit) Gross Profit (in thousands) | Period | 2025 | 2024 | Gross Profit Margin 2025 | Gross Profit Margin 2024 | | :--- | :--- | :--- | :--- | :--- | | Three Months Ended June 30 | $2,511 | $2,757 | 43.9% | 41.1% | | Six Months Ended June 30 | $4,633 | $4,152 | 43.1% | 34.6% | - **Gross profit margin increased** for both periods, driven by lower production costs following the closure of the Fremont manufacturing facility and the transition of AlterG production to a contract manufacturer, with further improvements expected from in-house ReWalk production[139](index=139&type=chunk)[140](index=140&type=chunk) [Research and Development Expenses, net](index=39&type=section&id=Research%20and%20Development%20Expenses%2C%20net) Research and Development Expenses, net (in thousands) | Period | 2025 | 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Three Months Ended June 30 | $767 | $1,205 | $(438) | -36.3% | | Six Months Ended June 30 | $1,685 | $2,496 | $(811) | -32.5% | - The decrease in R&D expenses was primarily due to the **completion of development programs** for the ReWalk 7 and AlterG NEO[142](index=142&type=chunk)[143](index=143&type=chunk) [Sales and Marketing Expenses](index=40&type=section&id=Sales%20and%20Marketing%20Expenses) Sales and Marketing Expenses (in thousands) | Period | 2025 | 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Three Months Ended June 30 | $3,785 | $4,403 | $(618) | -14.0% | | Six Months Ended June 30 | $7,622 | $9,417 | $(1,795) | -19.1% | - The decrease was driven by a reduction in reimbursement and marketing consultants, lower promotional spending, and the absence of amortization of intangible assets from the AlterG acquisition (which was **$0.4 million** in Q2 2024 and **$0.8 million** in H1 2024)[145](index=145&type=chunk)[146](index=146&type=chunk) [General and Administrative Expenses](index=40&type=section&id=General%20and%20Administrative%20Expenses) General and Administrative Expenses (in thousands) | Period | 2025 | 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Three Months Ended June 30 | $1,739 | $1,592 | $147 | 9.2% | | Six Months Ended June 30 | $3,959 | $3,184 | $775 | 24.3% | - The increase was primarily due to a **$0.4 million bad debt expense** in Q2 2025 (**$0.6 million** in H1 2025) related to Medicare claims and restructuring costs, partially offset by the elimination of the earnout liability[148](index=148&type=chunk)[149](index=149&type=chunk) [Impairment Charges](index=40&type=section&id=Impairment%20Charges) Impairment Charges (in thousands) | Period | 2025 | 2024 | | :--- | :--- | :--- | | Three Months Ended June 30 | $2,783 | $0 | | Six Months Ended June 30 | $2,783 | $0 | - A goodwill impairment charge of **$2.8 million** was recorded in Q2 2025 due to a sustained decline in the Company's share price, which caused its market capitalization to fall below its carrying value[150](index=150&type=chunk) [Financial Income, Net](index=41&type=section&id=Financial%20Income%2C%20Net) Financial Income, Net (in thousands) | Period | 2025 | 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Three Months Ended June 30 | $1 | $144 | $(143) | -99.3% | | Six Months Ended June 30 | $31 | $376 | $(345) | -91.8% | - The significant decrease in financial income, net, was primarily attributable to **lower yields on a reduced cash balance**[153](index=153&type=chunk) [Income Taxes](index=41&type=section&id=Income%20Taxes) Income Taxes (in thousands) | Period | 2025 | 2024 | Change ($) | | :--- | :--- | :--- | | Three Months Ended June 30 | $0 | $5 | $(5) | | Six Months Ended June 30 | $11 | $11 | $0 | - Income taxes decreased in Q2 2025 due to deferred taxes and timing differences in subsidiaries; for the six months, taxes remained constant, reflecting taxes incurred in Germany[154](index=154&type=chunk)[155](index=155&type=chunk) [Critical Accounting Policies and Estimates](index=42&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) - The preparation of financial statements requires significant estimates and judgments, which can affect reported amounts; no material changes to critical accounting policies were made, except for updates in Note 3[156](index=156&type=chunk)[157](index=157&type=chunk) [Recent Accounting Pronouncements](index=42&type=section&id=Recent%20Accounting%20Pronouncements) - Information regarding new accounting pronouncements is detailed in Note 3 to the unaudited condensed consolidated financial statements[158](index=158&type=chunk) [Liquidity and Capital Resources](index=42&type=section&id=Liquidity%20and%20Capital%20Resources) [Sources of Liquidity and Outlook](index=42&type=section&id=Sources%20of%20Liquidity%20and%20Outlook) - As of June 30, 2025, the Company had **$5.1 million** in cash and cash equivalents and an accumulated deficit of **$276.2 million**, raising substantial doubt about its ability to continue as a going concern[160](index=160&type=chunk) - Existing cash resources are expected to fund operations into **Q4 2025**; the Company plans to finance future operating costs through existing cash, reduced operating cash burn, and potential future equity/debt issuances[160](index=160&type=chunk)[161](index=161&type=chunk) - The Company received a deficiency letter from Nasdaq on August 5, 2025, for failing to maintain a minimum bid price of **$1.00 per share**, with 180 days to regain compliance to avoid potential delisting[167](index=167&type=chunk)[192](index=192&type=chunk) [Equity Raises](index=43&type=section&id=Equity%20Raises) - The Company is subject to Form S-3 limitations, restricting primary securities offerings to **one-third of its public float** in any 12-month period due to a public float below $75 million[168](index=168&type=chunk) - In January 2025, the Company issued **1,818,183 ordinary shares** and warrants for **$2.75 per share**, raising capital through a registered direct offering[170](index=170&type=chunk) - An At-the-Market (ATM) Offering Agreement was established in March 2025, under which **964,118 ordinary shares** were sold for net proceeds of approximately **$1.0 million** during Q2 2025[171](index=171&type=chunk)[172](index=172&type=chunk) - In June 2025, the Company completed a public offering of **4,000,000 ordinary shares** and warrants at **$0.65 per share**[174](index=174&type=chunk) [Cash Flows for the Six Months Ended June 30, 2025 and 2024](index=45&type=section&id=Cash%20Flows%20for%20the%20Six%20Months%20Ended%20June%2030%2C%202025%20and%202024) Net Cash Flow Summary (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(9,429) | $(13,290) | | Net cash used in investing activities | $(5) | $0 | | Net cash provided by financing activities | $7,779 | $0 | | Net cash flow | $(1,585) | $(13,305) | - Net cash used in operating activities decreased by **$3.9 million (29.1%)** due to improved working capital management and reduced operating expenses[178](index=178&type=chunk) - Net cash provided by financing activities increased by **$7.8 million**, primarily from the January 2025 offering, ATM program, and June 2025 offering[180](index=180&type=chunk) [Obligations and Contractual Commitments](index=45&type=section&id=Obligations%20and%20Contractual%20Commitments) Contractual Obligations as of June 30, 2025 (in thousands) | Contractual obligations | Total | Less than 1 year | 1-3 years | | :--- | :--- | :--- | :--- | | Purchase obligations | $7,384 | $7,384 | $0 | | Operating lease obligations | $405 | $309 | $96 | | Total | $7,789 | $7,693 | $96 | - The Company terminated its manufacturing agreement with Sanmina Corporation in June 2025; AlterG Anti-Gravity systems are now produced by Cirtronics Corporation[182](index=182&type=chunk) [Off-Balance Sheet Arrangements](index=46&type=section&id=Off-Balance%20Sheet%20Arrangements) - As of June 30, 2025, the Company had **no off-balance sheet arrangements** or guarantees of third-party obligations[184](index=184&type=chunk) [ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](index=46&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) There have been no material changes to the Company's market risk exposure during the second quarter of 2025 - **No material changes** to market risk occurred during Q2 2025[185](index=185&type=chunk) [ITEM 4. CONTROLS AND PROCEDURES](index=46&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) This section confirms the effectiveness of Lifeward's disclosure controls and procedures as of June 30, 2025, and reports no material changes in internal control over financial reporting during the quarter [Disclosure Controls and Procedures](index=46&type=section&id=Disclosure%20Controls%20and%20Procedures) - As of June 30, 2025, the Chief Executive Officer and Principal Financial Officer concluded that the Company's disclosure controls and procedures were **effective**[187](index=187&type=chunk) [Changes in Internal Control over Financial Reporting](index=46&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) - **No changes** in internal control over financial reporting materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting during the quarter ended June 30, 2025[188](index=188&type=chunk) PART II - OTHER INFORMATION [ITEM 1. LEGAL PROCEEDINGS](index=47&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) There have been no material changes to the Company's legal proceedings as described in its 2024 Form 10-K, except as noted in the financial statements - **No material changes** to legal proceedings were reported, except as described in Note 7 of the financial statements[190](index=190&type=chunk) [ITEM 1A. RISK FACTORS](index=47&type=section&id=ITEM%201A.%20RISK%20FACTORS) This section highlights new risks including non-compliance with Nasdaq's minimum bid price and challenges from in-house manufacturing transition - The Company is **non-compliant with Nasdaq's minimum bid price requirement** ($1.00 per share) as of August 4, 2025, and has 180 calendar days to regain compliance to avoid potential delisting[191](index=191&type=chunk)[192](index=192&type=chunk) - **Delisting from Nasdaq** could severely decrease the value and liquidity of ordinary shares, potentially leading to a 'penny stock' designation and hindering future financing[193](index=193&type=chunk) - The transition of ReWalk product manufacturing to an **in-house facility** in Q2 2025, following the termination of the agreement with Sanmina, poses risks related to building experienced teams and sourcing components, which could adversely affect business operations[194](index=194&type=chunk)[195](index=195&type=chunk)[196](index=196&type=chunk)[197](index=197&type=chunk) [ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS](index=49&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) This item is not applicable for the reporting period - Not applicable[198](index=198&type=chunk) [ITEM 3. DEFAULTS UPON SENIOR SECURITIES](index=49&type=section&id=ITEM%203.%20DEFAULTS%20UPON%20SENIOR%20SECURITIES) This item is not applicable for the reporting period - Not applicable[199](index=199&type=chunk) [ITEM 4. MINE SAFETY DISCLOSURES](index=49&type=section&id=ITEM%204.%20MINE%20SAFETY%20DISCLOSURES) This item is not applicable for the reporting period - Not applicable[200](index=200&type=chunk) [ITEM 5. OTHER INFORMATION](index=49&type=section&id=ITEM%205.%20OTHER%20INFORMATION) This section confirms that no Rule 10b5-1 trading arrangements were adopted or terminated by directors or officers during the quarter - **No Rule 10b5-1 trading arrangements** were adopted or terminated by directors or officers during the quarter ended June 30, 2025[201](index=201&type=chunk) [ITEM 6. EXHIBITS](index=50&type=section&id=ITEM%206.%20EXHIBITS) This section lists all exhibits filed with the Form 10-Q, including organizational documents, warrant forms, purchase agreements, and certifications - Exhibits include the Seventh Amended and Restated Articles of Association, forms of ordinary and placement agent warrants, securities purchase agreements, an employment agreement for the President and CEO, and certifications under the Sarbanes-Oxley Act[203](index=203&type=chunk) [SIGNATURES](index=51&type=section&id=SIGNATURES) The report is duly signed on behalf of Lifeward Ltd by its President and Chief Executive Officer and its Chief Financial Officer on August 14, 2025 - The report was signed by William Mark Grant, President and CEO, and Almog Adar, CFO, on **August 14, 2025**[208](index=208&type=chunk)