Financial Performance - The company has incurred a net loss of $19,694,921 and an accumulated deficit of $51,635,448 as of September 30, 2025[169]. - Revenue increased by $3,236,131 to $4,192,101 for the three months ended September 30, 2025, compared to $955,970 for the same period in 2024, primarily due to the sale of nine QT Breast Scanners in Q3 2025 versus two in Q3 2024[194]. - The net loss for the three months ended September 30, 2025, was $4,557,406, a 26% increase from the net loss of $3,619,494 in Q3 2024[193]. - Revenue increased by $6,617,762 to $10,649,930 for the nine months ended September 30, 2025, representing a 164% increase compared to the same period in 2024[205]. - The company recorded a net loss of $19,694,921 for the nine months ended September 30, 2025, adjusted for various non-cash expenses[235]. - For the nine months ended September 30, 2024, the company reported a net loss of $5,496,958, with significant non-cash expenses including $3,718,349 related to common stock issued for services[237]. Expenses and Costs - Cost of revenue rose to $2,389,428 in Q3 2025 from $350,667 in Q3 2024, reflecting an increase of 581%[193]. - Gross profit for the three months ended September 30, 2025, was $1,802,673, up 198% from $605,303 in the same period of 2024[193]. - Selling, general and administrative expenses rose by 25% to $2,515,994 in Q3 2025, compared to $2,007,277 in Q3 2024[193]. - Total operating expenses increased by 18% to $3,454,752 in Q3 2025 from $2,932,491 in Q3 2024[193]. - Cost of revenue increased by $3,416,084 to $5,208,318 for the nine months ended September 30, 2025, a 191% increase from the prior year[206]. - Gross profit for the nine months ended September 30, 2025, was $5,441,612, up 143% from $2,239,934 in 2024[204]. - Selling, general and administrative expenses decreased by $3,386,332 to $6,486,697 for the nine months ended September 30, 2025, a 34% reduction compared to the previous year[208]. - Interest expense, net decreased by $1,514,301 to $1,635,014 for the nine months ended September 30, 2025, a 48% decrease from $3,149,315 in 2024[213]. - The change in fair value of earnout liability decreased by $5,040,000 to an expense of $2,070,000 during the nine months ended September 30, 2025[212]. Funding and Capital - The company continues to incur losses and will need to raise additional capital to achieve profitability[169]. - The company expects cash inflows of up to $18.0 million in 2025 and $27.0 million in 2026 from the Amended Distribution Agreement with NXC[216]. - The Gulf Medical Distribution Agreement with GMC could result in cash inflows of $11.2 million to $12.3 million in 2026 if Minimum Purchase Requirements are met[217]. - The company anticipates that cash received from various private placements will be sufficient to fund its operating plan for at least the next 12 months[220]. - The company plans to raise additional capital through equity issuance, borrowings, and strategic alliances, which may dilute existing stockholder interests[243]. - Future funding needs will depend on various factors, including debt repayment, manufacturing expansion, and regulatory progress[242]. - The company entered into a credit agreement for a senior secured term loan of $10,100,000 at an interest rate of 10.0% per annum, maturing on March 31, 2027[174]. - The company raised $18,180,655 from the October 2025 Private Placement, issuing 2,232,243 shares of common stock at a price of $4.50 per share[219]. - The Lynrock Amended Credit Agreement increased the aggregate principal amount of the Lynrock Lake Term Loan to $15.1 million[229]. Agreements and Partnerships - The company received nearly $18 million in financial support from the U.S. National Institutes of Health for the development of its body imaging technology[161]. - The company entered into a Distribution Agreement with Gulf Medical Co. for exclusive rights to market QT Breast Scanners in Saudi Arabia for an initial term of three years[168]. - The NXC Distribution Agreement allows NXC to market and resell QT Breast Scanners in the U.S. and U.S. territories[165]. - The Canon Manufacturing Agreement with Canon Medical Systems, Inc. appoints CMSC as the exclusive manufacturer of QT Breast Scanners through December 31, 2026[166]. Operational Insights - The company has delivered 23 QT Breast Scanners to NXC and its customers as of September 30, 2025[165]. - The company expects to incur additional recurring administrative expenses associated with being a publicly traded company[170]. - The company aims to create disruptive technological innovations to improve medical imaging and healthcare quality[167]. - The company is subject to risks associated with manufacturing and commercialization, which could significantly increase operating capital requirements[243]. - The company has no off-balance sheet arrangements and leases its operating facilities under a non-cancelable lease through May 31, 2027[248][249]. - The company is classified as an emerging growth company, allowing it to delay adopting new accounting standards until certain conditions are met[251]. Stock and Debt Management - The company has modified the conversion price for a $10 million promissory note with Yorkville to $1.752 per share for part of the outstanding balance[171]. - A reverse stock split at a ratio of 3:1 was approved, effective October 23, 2025, with shares trading on a reverse split-adjusted basis starting October 24, 2025[181]. - The company issued warrants to purchase 20,333,623 shares of common stock at an exercise price of $1.20 per share in connection with the Lynrock Lake Term Loan[174]. - As of September 30, 2025, the outstanding amount of the Lynrock Lake Term Loan was $5,272,879, net of unamortized debt discount of $9,827,121, and accrued interest of $670,193[228]. - As of September 30, 2025, the outstanding amount of the 2020 Notes was $3,190,112, with accrued interest of $679,215[232]. - The company repaid the Tranche B loan of $5.0 million on October 6, 2025, plus accrued interest and a 6% premium[230].

Financial Performance - Generated revenue of $4.2 million in Q3 2025, representing a 339% year-over-year growth and a 15% sequential growth from Q2 2025[8] - Revenue for the three months ended September 30, 2025, was $4,192,000, a significant increase from $956,000 in the same period of 2024, representing a growth of 338%[21] - Gross profit for the three months ended September 30, 2025, was $1,803,000, compared to $605,000 in 2024, indicating an increase of 198%[21] - Net loss for Q3 2025 was $4.6 million, or $(0.47) per share, compared to a net loss of $3.6 million, or $(0.51) per share, in Q3 2024[8] - The net loss for the three months ended September 30, 2025, was $4,557,000, compared to a net loss of $3,619,000 in 2024, reflecting a deterioration of 26%[21] - Non-GAAP Adjusted EBITDA for Q3 2025 was $(1.4) million, an improvement from $(2.2) million in Q3 2024[8] - Adjusted EBITDA for the three months ended September 30, 2025, was $(1,397,000), an improvement from $(2,163,000) in the same period of 2024[23] - Net loss for the nine months ended September 30, 2025, was $19,695,000, compared to a net loss of $5,497,000 in 2024, indicating a significant increase in losses[27] Expenses and Liabilities - Total operating expenses for Q3 2025 were $3.5 million, an 18% increase from $2.9 million in Q3 2024[8] - Research and development expenses for the three months ended September 30, 2025, were $939,000, slightly up from $925,000 in 2024, showing a marginal increase of 2%[21] - Total liabilities as of September 30, 2025, were $21,197,000, up from $15,625,000 as of December 31, 2024, indicating an increase of 36%[25] - The company’s accumulated deficit as of September 30, 2025, was $(51,635,000), compared to $(31,941,000) as of December 31, 2024, indicating a worsening of 62%[25] Cash Flow and Financing - Net cash used in operating activities decreased to $5,858,000 in 2025 from $8,806,000 in 2024, showing improved cash flow management[27] - Cash and cash equivalents as of September 30, 2025, were $1,715,000, compared to $1,172,000 as of December 31, 2024, reflecting an increase of 46%[25] - Cash and restricted cash and cash equivalents at the end of the period increased to $1,735,000 in 2025 from $1,564,000 in 2024[27] - Proceeds from long-term debt, net of issuance costs, amounted to $15,000,000 in 2025, up from $10,525,000 in 2024, reflecting increased financing activity[27] - Net cash provided by financing activities decreased to $6,448,000 in 2025 from $10,220,000 in 2024, indicating a reduction in financing inflows[27] - The company reported a repayment of long-term debt of $4,688,000 in 2025, compared to $1,243,000 in 2024, reflecting a strategy to reduce debt obligations[27] Strategic Developments - Shipped nine QTI Breast Acoustic CT™ scanners in Q3 2025, aligning with the annual projection of shipping a total of 40 scanners in 2025[3] - The company reaffirmed its revenue forecast of $18 million for 2025 and increased its 2026 revenue outlook from $27 million to $39 million[6] - Entered into an exclusive distribution agreement with Gulf Medical Co. for QTI Breast Acoustic CT™ scanners in Saudi Arabia[3] - Appointed Jay Jennings as CFO and Satrajit Misra as Chief Commercial Officer, bringing nearly 60 years of combined experience to the company[2] Stock and Market Conditions - Stock-based compensation increased to $519,000 in 2025 from $166,000 in 2024, indicating a rise in employee compensation costs[27] - The change in fair value of warrant liability resulted in a gain of $3,581,000 in 2025, compared to a loss of $200,000 in 2024, suggesting improved market conditions for warrants[27] - The company reported a loss on issuance of the Lynrock Lake Term Loan of $6,640,000, which was a new expense not present in the previous year[27] - The company experienced a significant loss on issuance of common stock in connection with a subscription agreement, totaling $206,000 in 2024, which was not reported in 2025[27]

As filed with the U.S. Securities and Exchange Commission on November 3, 2025. Registration No. 333- UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 QT Imaging Holdings, Inc. (Exact Name of Registrant as Specified in its Charter) (State or Other Jurisdiction of Incorporation or Organization) (Primary Standard Industrial Classification Code No.) Delaware 6770 85-1728920 (I.R.S. Employer Identification No.) Dr. Raluca Din ...

Part I. Financial Information [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) Presents unaudited condensed consolidated financial statements and explanatory notes for periods ending June 30, 2025, and December 31, 2024 [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) - Total assets increased from **$6,086,673** as of December 31, 2024, to **$11,631,817** as of June 30, 2025, primarily driven by increases in cash and accounts receivable[11](index=11&type=chunk) - The company's stockholders' deficit significantly improved from **$(9,538,284)** as of December 31, 2024, to **$(324,294)** as of June 30, 2025[11](index=11&type=chunk) | ASSETS (June 30, 2025) | Amount ($) | | :----------------------- | :----------- | | Cash | 2,022,180 | | Accounts receivable | 3,651,310 | | Inventory | 3,231,098 | | Total current assets | 10,667,892 | | Total assets | 11,631,817 | | LIABILITIES AND STOCKHOLDERS' DEFICIT (June 30, 2025) | Amount ($) | | :---------------------------------------------------- | :----------- | | Accounts payable | 1,595,789 | | Accrued expenses and other current liabilities | 4,210,416 | | Total current liabilities | 6,306,539 | | Total liabilities | 11,956,111 | | Total stockholders' deficit | (324,294) | [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) - Revenue increased significantly by **113%** for the three months ended June 30, 2025, and by **110%** for the six months ended June 30, 2025, compared to the same periods in 2024[13](index=13&type=chunk)[173](index=173&type=chunk)[183](index=183&type=chunk) - Net loss increased to **$(4,001,515)** for the three months ended June 30, 2025, from **$(1,248,874)** in the prior year, and to **$(15,137,515)** for the six months ended June 30, 2025, from **$(1,877,464)** in the prior year, primarily due to changes in fair value of warrant and derivative liabilities and other expenses[13](index=13&type=chunk)[172](index=172&type=chunk)[182](index=182&type=chunk) | Metric | Three Months Ended June 30, 2025 ($) | Three Months Ended June 30, 2024 ($) | Six Months Ended June 30, 2025 ($) | Six Months Ended June 30, 2024 ($) | | :------------------------------------ | :----------------------------------- | :----------------------------------- | :--------------------------------- | :--------------------------------- | | Revenue | 3,659,414 | 1,714,035 | 6,457,829 | 3,076,198 | | Gross profit | 1,827,077 | 874,551 | 3,638,939 | 1,634,631 | | Loss from operations | (1,042,979) | (2,220,072) | (2,084,710) | (7,798,749) | | Net loss | (4,001,515) | (1,248,874) | (15,137,515) | (1,877,464) | | Net loss per share - basic and diluted | (0.14) | (0.30) | (0.54) | (0.41) | [Condensed Consolidated Statements of Stockholders' Deficit](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders%27%20Deficit) - Additional paid-in capital significantly increased from **$22,399,567** at January 1, 2025, to **$46,750,884** at June 30, 2025, primarily due to reclassification of warrant liability upon modification (**$22,986,128**) and private placements[16](index=16&type=chunk) - The accumulated deficit increased from **$(31,940,527)** to **$(47,078,042)** due to net losses incurred during the period[16](index=16&type=chunk) | Metric | Balance, January 1, 2025 ($) | Balance, June 30, 2025 ($) | | :------------------------------------ | :--------------------------- | :------------------------- | | Common Stock (Amount) | 2,676 | 2,864 | | Additional Paid-in Capital | 22,399,567 | 46,750,884 | | Accumulated Deficit | (31,940,527) | (47,078,042) | | Total Stockholders' Deficit | (9,538,284) | (324,294) | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) - Net cash used in operating activities decreased from **$(6,955,081)** in H1 2024 to **$(4,978,822)** in H1 2025, despite a higher net loss, due to significant non-cash adjustments[21](index=21&type=chunk)[209](index=209&type=chunk) - Net cash provided by financing activities decreased from **$11,398,512** in H1 2024 to **$5,875,716** in H1 2025, primarily due to lower proceeds from long-term debt and the absence of merger proceeds[21](index=21&type=chunk)[212](index=212&type=chunk)[214](index=214&type=chunk) | Cash Flow Activity | Six Months Ended June 30, 2025 ($) | Six Months Ended June 30, 2024 ($) | | :--------------------------------- | :--------------------------------- | :--------------------------------- | | Net cash used in operating activities | (4,978,822) | (6,955,081) | | Net cash used in investing activities | (46,818) | (26,977) | | Net cash provided by financing activities | 5,875,716 | 11,398,512 | | Net increase in cash and restricted cash | 850,076 | 4,416,454 | | Cash and restricted cash, end of year | 2,042,180 | 4,601,140 | [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) [1. The Company and Summary of Significant Accounting Policies](index=10&type=section&id=1.%20The%20Company%20and%20Summary%20of%20Significant%20Accounting%20Policies) - QT Imaging Holdings, Inc. is a medical device company focused on innovative body imaging systems using low-frequency sound waves, with its initial product being a breast imaging system (QT Breast Scanner)[25](index=25&type=chunk) - The company completed a business combination with GigCapital5, Inc. on March 4, 2024, with QT Imaging, Inc. surviving as a wholly-owned subsidiary and being the accounting acquirer[26](index=26&type=chunk)[55](index=55&type=chunk)[56](index=56&type=chunk) - The company has incurred significant net operating losses and negative cash flows since inception, with an accumulated deficit of **$47,078,042** as of June 30, 2025, and will require additional capital to achieve profitability[31](index=31&type=chunk)[154](index=154&type=chunk) Significant Customer Concentration (June 30, 2025) | Customer | Accounts Receivable, Net (June 30, 2025) | Revenue (Three Months Ended June 30, 2025) | Revenue (Six Months Ended June 30, 2025) | | :--------- | :--------------------------------------- | :----------------------------------------- | :--------------------------------------- | | Customer A (NXC) | 99 % | 99 % | 98 % | [2. Business Combination](index=14&type=section&id=2.%20Business%20Combination) - The Merger with GigCapital5 was consummated on March 4, 2024, and was accounted for as a reverse recapitalization, with QT Imaging determined as the accounting acquirer[55](index=55&type=chunk)[56](index=56&type=chunk) - The net impact of the Merger on the condensed consolidated statement of stockholders' deficit was **$(12,939,165)**, including net cash proceeds of **$1,238,530** from GigCapital5[57](index=57&type=chunk) [3. Fair Value Measurements](index=14&type=section&id=3.%20Fair%20Value%20Measurements) - The Lynrock Lake Warrant and Yorkville Warrant, initially classified as warrant liabilities, were reclassified to additional paid-in capital on June 11, 2025, after amendments allowed for equity classification[65](index=65&type=chunk)[66](index=66&type=chunk)[122](index=122&type=chunk)[123](index=123&type=chunk)[258](index=258&type=chunk) - The derivative liability related to the Yorkville Pre-Paid Advance was extinguished on February 26, 2025, following the termination of the SEPA and Yorkville Note[77](index=77&type=chunk)[179](index=179&type=chunk)[189](index=189&type=chunk) Fair Value of Liabilities (June 30, 2025 vs. December 31, 2024) | Liability | Level | June 30, 2025 ($) | December 31, 2024 ($) | | :---------------- | :---- | :------------------ | :-------------------- | | Warrant Liability | 2 | 25,791 | 22,234 | | Earnout liability | 3 | 280,000 | 440,000 | | Derivative liability | 3 | — | 303,300 | [4. Inventory](index=19&type=section&id=4.%20Inventory) - Total inventory increased slightly from **$3,140,719** at December 31, 2024, to **$3,231,098** at June 30, 2025, with a notable shift from finished goods to work in process[79](index=79&type=chunk) Inventory Composition (June 30, 2025 vs. December 31, 2024) | Category | June 30, 2025 ($) | December 31, 2024 ($) | | :--------------- | :------------------ | :-------------------- | | Raw materials | 2,396,311 | 2,551,947 | | Work in process | 826,728 | 278,869 | | Finished goods | 8,059 | 309,903 | | Total | 3,231,098 | 3,140,719 | [5. Property and Equipment, Net](index=20&type=section&id=5.%20Property%20and%20Equipment%2C%20Net) - Net property and equipment decreased from **$195,783** at December 31, 2024, to **$166,676** at June 30, 2025, primarily due to ongoing depreciation[80](index=80&type=chunk) Property and Equipment, Net (June 30, 2025 vs. December 31, 2024) | Category | June 30, 2025 ($) | December 31, 2024 ($) | | :---------------------- | :------------------ | :-------------------- | | Total gross property and equipment | 3,929,797 | 3,882,980 | | Less: accumulated depreciation | (3,763,121) | (3,687,197) | | Property and equipment, net | 166,676 | 195,783 | [6. Balance Sheet Details](index=20&type=section&id=6.%20Balance%20Sheet%20Details) Prepaid Expenses and Other Current Assets (June 30, 2025 vs. December 31, 2024) | Category | June 30, 2025 ($) | December 31, 2024 ($) | | :-------------------------------- | :------------------ | :-------------------- | | Prepaid insurance | 268,240 | 179,143 | | Other receivable | 665,165 | 131,865 | | Deferred issuance costs | 157,685 | — | | Other | 652,214 | 205,544 | | Total | 1,743,304 | 516,552 | Accrued Expenses and Other Current Liabilities (June 30, 2025 vs. December 31, 2024) | Category | June 30, 2025 ($) | December 31, 2024 ($) | | :-------------------------------- | :------------------ | :-------------------- | | Accrued legal | 1,925,900 | 1,867,107 | | Accrued personnel costs | 950,214 | 963,865 | | Purchase commitment | 665,145 | — | | Total | 4,210,416 | 3,549,954 | [7. Long-Term Debt](index=20&type=section&id=7.%20Long-Term%20Debt) - The Yorkville Note was fully settled on February 26, 2025, by a **$3,000,000** cash payment and the issuance of a warrant to purchase **15,000,000** shares of common stock[92](index=92&type=chunk)[159](index=159&type=chunk) - The Cable Car Note was fully settled on February 26, 2025, by a cash payment of approximately **$1,625,000**[96](index=96&type=chunk)[97](index=97&type=chunk)[160](index=160&type=chunk) - The company entered into a Credit Agreement for a **$10,100,000** senior secured term loan with Lynrock Lake on February 26, 2025, bearing **10.0%** annual interest and maturing on March 31, 2027[99](index=99&type=chunk)[158](index=158&type=chunk)[197](index=197&type=chunk) - In connection with the Lynrock Lake Term Loan, the company issued a warrant to purchase **61,000,000** shares of common stock to Lynrock Lake[104](index=104&type=chunk)[158](index=158&type=chunk)[202](index=202&type=chunk) Future Principal Payments on Long-Term Debt (as of June 30, 2025) | Year ending December 31: | Amount ($) | | :----------------------- | :----------- | | 2025 (remaining) | 27,501 | | 2026 | 9,197 | | 2027 | 10,100,000 | | Total payments | 10,136,698 | [8. Leases](index=25&type=section&id=8.%20Leases) - The company leases its operating facilities under a non-cancelable operating lease through May 31, 2027[108](index=108&type=chunk)[224](index=224&type=chunk) - The weighted-average remaining lease term was **1.9 years** as of June 30, 2025, with a weighted-average discount rate of **8%**[110](index=110&type=chunk) Operating Lease Liabilities (June 30, 2025 vs. December 31, 2024) | Category | June 30, 2025 ($) | December 31, 2024 ($) | | :-------------------------- | :------------------ | :-------------------- | | Operating lease ROU assets, net | 758,099 | 935,246 | | Operating lease liabilities, current | 429,350 | 405,678 | | Operating lease liabilities | 437,411 | 656,955 | | Total | 866,761 | 1,062,633 | [9. Contingencies](index=26&type=section&id=9.%20Contingencies) - Management is not aware of any pending claims that will have a material impact on the company's condensed consolidated financial statements as of the reporting date[111](index=111&type=chunk)[225](index=225&type=chunk) [10. Stockholders' Deficit](index=26&type=section&id=10.%20Stockholders%27%20Deficit) - The company has **500,000,000** shares of common stock authorized, with **28,643,478** shares issued and outstanding as of June 30, 2025[11](index=11&type=chunk) - Various warrants (PubCo, PIPE, Lynrock Lake, Yorkville) are outstanding, with significant numbers of shares potentially issuable upon exercise, which could lead to dilution[117](index=117&type=chunk)[118](index=118&type=chunk)[119](index=119&type=chunk)[120](index=120&type=chunk)[122](index=122&type=chunk)[123](index=123&type=chunk)[254](index=254&type=chunk) Common Stock Reserved for Future Issuance (June 30, 2025) | Item | Shares | | :-------------------------------- | :----------- | | Common stock warrants | 106,048,119 | | Merger earnout consideration shares | 6,000,000 | | Options outstanding under 2024 Incentive Plan | 3,320,999 | | Options available under 2024 Incentive Plan | 375,505 | | Potential shares from convertible notes | 259,052 | | Total | 116,003,675 | [11. Stock Incentive Plan](index=29&type=section&id=11.%20Stock%20Incentive%20Plan) - Total unrecognized compensation cost related to nonvested stock options was **$930,043** as of June 30, 2025, to be recognized over an average period of **1.61 years**[128](index=128&type=chunk) 2024 Equity Incentive Plan Activity (Six Months Ended June 30, 2025) | Metric | Number of Options | Weighted-Average Exercise Price ($) | | :-------------------------------- | :---------------- | :---------------------------------- | | Outstanding, January 1, 2025 | 1,955,000 | 0.75 | | Granted under 2024 Incentive Plan | 1,566,000 | 0.67 | | Cancelled | (200,001) | 0.75 | | Outstanding, June 30, 2025 | 3,320,999 | 0.71 | | Exercisable as of June 30, 2025 | 1,002,070 | 0.73 | Stock-Based Compensation Expense by Functional Area | Functional Area | Three Months Ended June 30, 2025 ($) | Six Months Ended June 30, 2025 ($) | | :-------------------------- | :----------------------------------- | :--------------------------------- | | Research and development | 11,553 | 28,296 | | Selling, general and administrative | 207,657 | 291,630 | | Total | 219,210 | 319,926 | [12. Revenue Recognition](index=30&type=section&id=12.%20Revenue%20Recognition) - Substantially all revenue is recognized at a point in time, with contract liabilities of **$34,286** as of June 30, 2025, expected to be recognized within the next 12 months[129](index=129&type=chunk) Revenue Disaggregation (Three and Six Months Ended June 30, 2025 vs. 2024) | Category | Three Months Ended June 30, 2025 ($) | Three Months Ended June 30, 2024 ($) | Six Months Ended June 30, 2025 ($) | Six Months Ended June 30, 2024 ($) | | :------- | :----------------------------------- | :----------------------------------- | :--------------------------------- | :--------------------------------- | | Product | 3,626,417 | 1,658,681 | 6,386,735 | 2,964,801 | | Service | 32,997 | 55,354 | 71,094 | 111,397 | | Total | 3,659,414 | 1,714,035 | 6,457,829 | 3,076,198 | Revenue by Geography (Three and Six Months Ended June 30, 2025 vs. 2024) | Geography | Three Months Ended June 30, 2025 ($) | Three Months Ended June 30, 2024 ($) | Six Months Ended June 30, 2025 ($) | Six Months Ended June 30, 2024 ($) | | :---------- | :----------------------------------- | :----------------------------------- | :--------------------------------- | :--------------------------------- | | United States | 3,649,057 | 1,700,130 | 6,436,083 | 3,058,325 | | International | 10,357 | 13,905 | 21,746 | 17,873 | | Total | 3,659,414 | 1,714,035 | 6,457,829 | 3,076,198 | [13. Income Taxes](index=30&type=section&id=13.%20Income%20Taxes) - The company's effective tax rate was **0%** for the three and six months ended June 30, 2025 and 2024, and is expected to remain **0%** for the full year 2024[131](index=131&type=chunk) - The recently enacted OBBBA legislation (July 4, 2025) is not expected to have a material impact on the company's consolidated financial statements[132](index=132&type=chunk) [14. Related Party Transactions](index=30&type=section&id=14.%20Related%20Party%20Transactions) - The 2020 Notes, convertible notes payable to stockholders, had their maturity date extended to October 21, 2027, in connection with the Lynrock Lake Term Loan[134](index=134&type=chunk)[204](index=204&type=chunk) - The Working Capital Note, an interest-free promissory note to a stockholder, had its maturity date extended to October 1, 2027, also in connection with the Lynrock Lake Term Loan[136](index=136&type=chunk)[207](index=207&type=chunk) - The company completed a private placement on April 24, 2025, with related parties, raising **$500,000** in net proceeds by issuing common stock and warrants[137](index=137&type=chunk)[161](index=161&type=chunk) [15. Segment Information](index=31&type=section&id=15.%20Segment%20Information) - The company operates as a single operating and reportable segment, focused on the development and commercialization of the QT Breast Scanner[138](index=138&type=chunk) - All of the company's long-lived assets are located in the United States[140](index=140&type=chunk) [16. Revised Financial Statements](index=32&type=section&id=16.%20Revised%20Financial%20Statements) - The company revised its condensed consolidated financial statements for the six months ended June 30, 2024, to correct a misstatement related to the initial recognition of the earnout liability, which was deemed not qualitatively material[37](index=37&type=chunk)[142](index=142&type=chunk) Impact of Revision on Key Financials (Six Months Ended June 30, 2024) | Line Item | As Filed ($) | Adjustments ($) | Revised ($) | | :------------------------------------------ | :----------- | :-------------- | :---------- | | Additional paid-in capital | 22,341,598 | (3,670,000) | 18,671,598 | | Accumulated deficit | (28,503,111) | 3,670,000 | (24,833,111) | | Change in fair value of earnout liability | (750,000) | 3,670,000 | 2,920,000 | | Net loss and comprehensive loss attributable to common stockholders | (10,732,966) | 3,670,000 | (7,062,966) | | Net loss per share - basic and diluted | (0.62) | 0.21 | (0.41) | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=33&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's financial condition, operational results, liquidity, and future funding requirements, including its status as an emerging growth company [Overview](index=33&type=section&id=Overview) - QT Imaging is a medical device company developing and commercializing innovative body imaging systems using low-energy sound, with its primary product being the FDA-cleared QT Breast Scanner[146](index=146&type=chunk)[148](index=148&type=chunk)[150](index=150&type=chunk) - The company's commercialization strategy includes technological innovation, improving image quality, partnering with strategic distribution channels (e.g., NXC Imaging), internal and large-scale manufacturing (e.g., Canon Medical Systems), and expanding direct-to-customer approaches[151](index=151&type=chunk)[152](index=152&type=chunk)[153](index=153&type=chunk) - The company has a history of net operating losses and negative cash flows, with an accumulated deficit of **$47,078,042** as of June 30, 2025, and expects to continue incurring losses, necessitating additional capital[154](index=154&type=chunk) [Recent Developments](index=35&type=section&id=Recent%20Developments) - On January 9, 2025, the company amended the Yorkville Note and Cable Car Note, modifying conversion prices and extending maturity dates, and removing monthly payment obligations to Yorkville[156](index=156&type=chunk)[157](index=157&type=chunk) - On February 26, 2025, the company secured a **$10.1 million** senior secured term loan from Lynrock Lake, using proceeds to fully settle the Yorkville Note (**$3.0 million** cash + **15M** share warrant) and Cable Car Note (approx. **$1.625 million** cash)[158](index=158&type=chunk)[159](index=159&type=chunk)[160](index=160&type=chunk) - The company completed private placements in April and May 2025, raising **$500,000** and **$200,000** respectively, through the issuance of common stock and warrants for working capital[161](index=161&type=chunk)[162](index=162&type=chunk) [Components of Our Results of Operations](index=36&type=section&id=Components%20of%20Our%20Results%20of%20Operations) - Revenue is primarily derived from product sales (QT Breast Scanner, SW, accessories) recognized when control is transferred, and service revenue (maintenance, training) recognized when performance obligations are satisfied[163](index=163&type=chunk) - Cost of revenue includes manufacturing, personnel, importing, shipping, packaging, warranty, fulfillment, and inventory costs, expected to increase in absolute dollars but decrease as a percentage of revenue due to manufacturing efficiencies[164](index=164&type=chunk) - Research and development expenses, expensed as incurred, are expected to increase substantially due to continued investment in QT Breast Scanner development and enhancements[166](index=166&type=chunk)[167](index=167&type=chunk) - Selling, general and administrative expenses are anticipated to rise with expanding headcount, public company operating costs, commercial infrastructure development, and increased marketing efforts[169](index=169&type=chunk)[170](index=170&type=chunk) [Results of Operations](index=38&type=section&id=Results%20of%20Operations) [Comparison of the three months ended June 30, 2025 and 2024](index=38&type=section&id=Comparison%20of%20the%20three%20months%20ended%20June%2030%2C%202025%20and%202024) - Revenue increased by **113%** due to the sale of **eight** QT Breast Scanners in Q2 2025 compared to **four** in Q2 2024, driven by minimum order quantities (MOQs) from the NXC Distribution Agreement[173](index=173&type=chunk) - Net loss significantly increased by **220%** primarily due to a **$3.0 million** decrease in fair value of warrant liability (from income to expense) and a **$1.7 million** decrease in fair value of derivative liability (extinguished)[172](index=172&type=chunk)[178](index=178&type=chunk)[179](index=179&type=chunk) Key Financials (Three Months Ended June 30, 2025 vs. 2024) | Metric | 2025 ($) | 2024 ($) | Change ($) | Change (%) | | :------------------------------------ | :------- | :------- | :--------- | :--------- | | Revenue | 3,659,414 | 1,714,035 | 1,945,379 | 113 % | | Cost of revenue | 1,832,337 | 839,484 | 992,853 | 118 % | | Gross profit | 1,827,077 | 874,551 | 952,526 | 109 % | | Research and development | 900,694 | 925,082 | (24,388) | (3)% | | Selling, general and administrative | 1,969,362 | 2,169,541 | (200,179) | (9)% | | Loss from operations | (1,042,979) | (2,220,072) | 1,177,093 | 53 % | | Net loss | (4,001,515) | (1,248,874) | (2,752,641) | (220)% | [Comparison of the six months ended June 30, 2025 and 2024](index=40&type=section&id=Comparison%20of%20the%20six%20months%20ended%20June%2030%2C%202025%20and%202024) - Revenue increased by **110%** due to the sale of **fourteen** QT Breast Scanners in H1 2025 compared to **seven** in H1 2024, driven by MOQs from the NXC Distribution Agreement[183](index=183&type=chunk) - Net loss increased by **706%** primarily due to an **$8.5 million** increase in other expense, net (including debt extinguishment loss and non-cash expense from Lynrock Lake Term Loan issuance) and a **$3.7 million** decrease in fair value of warrant liability[182](index=182&type=chunk)[187](index=187&type=chunk)[188](index=188&type=chunk) Key Financials (Six Months Ended June 30, 2025 vs. 2024) | Metric | 2025 ($) | 2024 ($) | Change ($) | Change (%) | | :------------------------------------ | :------- | :------- | :--------- | :--------- | | Revenue | 6,457,829 | 3,076,198 | 3,381,631 | 110 % | | Cost of revenue | 2,818,890 | 1,441,567 | 1,377,323 | 96 % | | Gross profit | 3,638,939 | 1,634,631 | 2,004,308 | 123 % | | Research and development | 1,752,946 | 1,567,628 | 185,318 | 12 % | | Selling, general and administrative | 3,970,703 | 7,865,752 | (3,895,049) | (50)% | | Loss from operations | (2,084,710) | (7,798,749) | 5,714,039 | 73 % | | Net loss | (15,137,515) | (1,877,464) | (13,260,051) | (706)% | [Liquidity and Capital Resources](index=41&type=section&id=Liquidity%20and%20Capital%20Resources) - The company's liquidity sources include cash on hand, certificates of deposit, and expected future revenues from customer sales and equity issuances[192](index=192&type=chunk) - As of June 30, 2025, cash and restricted cash equivalents were **$2,042,180**, with an accumulated deficit of **$47,078,042**[193](index=193&type=chunk) - Management believes that recent financing activities (Lynrock Lake Term Loan, PIPE investments) and expected revenues from NXC Distribution Agreement MOQs (**$18.0M** in 2025, **$27.0M** in 2026) will be sufficient to fund operations for at least the next 12 months[194](index=194&type=chunk)[195](index=195&type=chunk) - Future funding requirements are substantial and depend on growth rate, R&D spending, sales/marketing expansion, and product enhancement costs; additional financing may be required and could result in dilution or restrictive covenants[196](index=196&type=chunk)[215](index=215&type=chunk)[216](index=216&type=chunk)[217](index=217&type=chunk) Cash Flows (Six Months Ended June 30, 2025 vs. 2024) | Cash Flow Activity | 2025 ($) | 2024 ($) | | :--------------------------------- | :------- | :------- | | Net cash used in operating activities | (4,978,822) | (6,955,081) | | Net cash used in investing activities | (46,818) | (26,977) | | Net cash provided by financing activities | 5,875,716 | 11,398,512 | | Net increase in cash and restricted cash | 850,076 | 4,416,454 | [Off-Balance Sheet Arrangements](index=47&type=section&id=Off-Balance%20Sheet%20Arrangements) - The company did not have any off-balance sheet arrangements during the periods presented and does not currently have any[223](index=223&type=chunk) [Contractual Obligations](index=47&type=section&id=Contractual%20Obligations) - The company's primary contractual obligation is an operating lease for its facilities in Novato, California, extending through May 31, 2027[224](index=224&type=chunk) [Contingencies](index=47&type=section&id=Contingencies) - Management is not aware of any pending claims that will have a material impact on the company's condensed consolidated financial statements[225](index=225&type=chunk) [Emerging Growth Company](index=47&type=section&id=Emerging%20Growth%20Company) - The company is an Emerging Growth Company (EGC) and has elected to use the extended transition period for complying with new or revised accounting standards, which may affect comparability with other public companies[226](index=226&type=chunk)[227](index=227&type=chunk) - As an EGC, the company is exempt from certain reporting requirements, including auditor's attestation on internal controls (Sarbanes-Oxley Act Section 404(b)) and certain executive compensation disclosures[228](index=228&type=chunk) [Critical Accounting and Estimates](index=48&type=section&id=Critical%20Accounting%20and%20Estimates) - Refer to the Annual Report on Form 10-K for the year ended December 31, 2024, for a discussion of critical accounting policies and estimates[230](index=230&type=chunk) [Recent Accounting Pronouncements](index=48&type=section&id=Recent%20Accounting%20Pronouncements) - Refer to Note 1 of the condensed consolidated financial statements for a discussion of recently adopted accounting standards and those not yet adopted[231](index=231&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=48&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, the company is not required to provide quantitative and qualitative disclosures about market risk - The company is a smaller reporting company and is not required to provide quantitative and qualitative disclosures about market risk[232](index=232&type=chunk) [Item 4. Controls and Procedures](index=48&type=section&id=Item%204.%20Controls%20and%20Procedures) Details the company's effective disclosure controls and procedures as of June 30, 2025, and the remediation of a prior material weakness in technical accounting - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of June 30, 2025[235](index=235&type=chunk) - A material weakness related to technical accounting, identified in prior periods, has been remediated as of March 31, 2025, through technology implementation, personnel hiring, and external resources[236](index=236&type=chunk) - During the three months ended June 30, 2025, internal controls for reviewing technical accounting analyses of significant and non-standard transactions were implemented[237](index=237&type=chunk) Part II. Other Information [Item 1. Legal Proceedings](index=50&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently subject to any material legal proceedings, nor are any threatened against it or its officers/directors - The company is not currently subject to any material legal proceedings, nor are any threatened against it or its officers/directors[240](index=240&type=chunk) [Item 1A. Risk Factors](index=50&type=section&id=Item%201A.%20Risk%20Factors) Supplements previously disclosed risk factors, highlighting the company's development-stage status, significant losses, and dependence on additional capital - The company is a development-stage company with limited operating history and significant losses, making it difficult to evaluate future viability and predict performance[244](index=244&type=chunk)[246](index=246&type=chunk) - Key risks include the ability to successfully execute the business model, achieve market acceptance and commercial viability of the QT Breast Scanner, repay debt obligations, raise additional capital, and manage growth effectively[242](index=242&type=chunk)[244](index=244&type=chunk)[247](index=247&type=chunk) - Future sales or the perception of future sales of common stock, including shares from warrant exercises (over **106 million** warrants outstanding as of June 30, 2025), could cause the market price to decline and lead to significant dilution for existing stockholders[112](index=112&type=chunk)[249](index=249&type=chunk)[252](index=252&type=chunk)[254](index=254&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=53&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Refers to previously disclosed information on private placements in April and May 2025, detailed in Form 8-K and Form 10-Q filings - Information on private placements in April and May 2025 is available in the Current Report on Form 8-K filed on April 10, 2025, and the Quarterly Report on Form 10-Q filed on May 13, 2025[259](index=259&type=chunk) [Item 3. Defaults Upon Senior Securities](index=53&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This item is not applicable to the company for the reporting period - This item is not applicable[260](index=260&type=chunk) [Item 4. Mine Safety Disclosures](index=53&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company for the reporting period - This item is not applicable[262](index=262&type=chunk) [Item 5. Other Information](index=54&type=section&id=Item%205.%20Other%20Information) No other information is reported under this item for the reporting period - No other information is reported under this item[263](index=263&type=chunk) [Item 6. Exhibits](index=55&type=section&id=Item%206.%20Exhibits) Lists all exhibits filed with the Form 10-Q, including corporate governance, warrant, debt, manufacturing, distribution agreements, and certifications - Exhibits include the Second Amended and Restated Certificate of Incorporation, Amended and Restated Bylaws, various Warrant Agreements (e.g., Lynrock Lake, Yorkville), Credit Agreement, Manufacturing Agreement with Canon Medical Systems, and Amended Distribution Agreement with NXC Imaging[264](index=264&type=chunk) - Certifications of the Principal Executive Officer and Principal Financial Officer are included pursuant to the Securities Exchange Act Rules and Sarbanes-Oxley Act[265](index=265&type=chunk) [Signatures](index=57&type=section&id=Signatures) The report was duly signed on August 7, 2025, by the Chief Executive Officer and Chief Financial Officer - The report was signed on August 7, 2025, by Dr. Raluca Dinu (CEO) and Anastas Budagov (CFO)[269](index=269&type=chunk)[270](index=270&type=chunk)

[Executive Summary & Company Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Company%20Highlights) QT Imaging reported strong Q2 2025 performance, record revenue, strategic evolution into an imaging platform, and is pursuing Nasdaq uplisting [Q2 2025 Performance Overview](index=1&type=section&id=Q2%202025%20Performance%20Overview) QT Imaging reported strong business momentum in Q2 2025, achieving record revenue of **$3.7 million** with a **50% gross margin**. The company is actively pursuing an uplisting to Nasdaq and has addressed warrant liabilities - QT Imaging achieved strong business momentum in Q2 2025, reporting record revenue of **$3.7 million** and a **50% gross margin**[1](index=1&type=chunk) - The Company is pursuing uplisting to Nasdaq and has addressed and removed warrant liability through amendments to warrant agreements[1](index=1&type=chunk) [Strategic Business Evolution](index=1&type=section&id=Strategic%20Business%20Evolution) QT Imaging is evolving from a scanner company into a scalable imaging platform, integrating proprietary hardware, advanced image reconstruction software, and AI-powered clinical decision tools to enhance breast health precision. This transformation includes the launch of the 'QTI Cloud Platform' - QT Imaging is rapidly evolving from a scanner company into a scalable imaging platform, combining proprietary hardware, advanced image reconstruction software, and AI-powered clinical decision tools[2](index=2&type=chunk) - The company aims to drive greater user adoption of its scanner technology and commercialize new AI-enhanced diagnostic tools for earlier detection and improved outcomes[2](index=2&type=chunk) - Eight QT Imaging Breast Acoustic CT™ scanners were shipped in Q2 2025, with two more in July, building a foundation for broader adoption[2](index=2&type=chunk) [Nasdaq Uplisting Initiative](index=1&type=section&id=Nasdaq%20Uplisting%20Initiative) To comply with Nasdaq's minimum share price requirement for uplisting, QT Imaging is seeking stockholder support for a reverse stock split, with the Annual Meeting scheduled for August 19 - A reverse stock split is intended to comply with the minimum share price requirement for uplisting to Nasdaq[3](index=3&type=chunk) - Stockholders are requested to vote ahead of the Annual Meeting on August 19 to support this pivotal step[3](index=3&type=chunk) [Second Quarter and Recent Business Developments](index=1&type=section&id=Second%20Quarter%20and%20Recent%20Business%20Developments) QT Imaging achieved operational milestones, enhanced product technology, launched strategic initiatives like the QTI Cloud Platform, and strengthened its financial position in Q2 2025 [Operational Achievements](index=1&type=section&id=Operational%20Achievements) QT Imaging shipped eight Breast Acoustic CT™ scanners in Q2 2025, contributing to record revenue, and expanded its market presence by making its technology available to patients in Iowa for the first time - Eight QT Imaging Breast Acoustic CT™ scanners were shipped in Q2 2025, generating record revenue[6](index=6&type=chunk) - The Company's radiation-free, 3D breast imaging technology was made available to patients in Iowa for the first time with a scanner installation at Innovative Radiology[10](index=10&type=chunk) [Product & Technology Enhancements](index=2&type=section&id=Product%20%26%20Technology%20Enhancements) QT Imaging released software update version 4.4.0, significantly reducing image processing time by leveraging NVIDIA's L40 GPU, and launched QTviewer™ version 2.8 with new features to enhance clinical efficiency and diagnostic accuracy - QTI's latest image reconstruction software update, version 4.4.0, substantially reduces QTscan™ image processing time, improving user throughput and efficiency, developed leveraging NVIDIA's L40 GPU[10](index=10&type=chunk) - The latest QTviewer™, version 2.8, was launched, providing new features designed to enhance clinical efficiency and diagnostic accuracy[10](index=10&type=chunk) [Strategic Initiatives](index=2&type=section&id=Strategic%20Initiatives) The company publicly unveiled its QTI Cloud Platform, a strategic initiative designed to transform breast health through imaging intelligence via a tiered Software as a Service (SaaS) model, expected to provide a new source of recurring revenues. Additionally, medical and clinical leadership was bolstered with key appointments - The QTI Cloud Platform was publicly unveiled, designed to transform breast health through imaging intelligence using a tiered Software as a Service (SaaS) delivery model[10](index=10&type=chunk) - Subscription fees from the QTI Cloud Platform are expected to provide a meaningful new source of recurring revenues[10](index=10&type=chunk) - Medical and clinical leadership was bolstered with the appointments of Elaine Iuanow, MD, as Chief Medical Officer and Kim Du as Senior Director of Clinical Operations[10](index=10&type=chunk) [Financial Strengthening](index=1&type=section&id=Financial%20Strengthening) QT Imaging strengthened its financial position by securing **$700,000** in net proceeds from two Private Investment in Public Entity (PIPE) investments, with significant contributions from Board members and Mr. Leon Recanati - Financial position strengthened via **$700,000** in net proceeds from two Private Investment in Public Entity (PIPE) investments[6](index=6&type=chunk) - **$500,000** of the PIPE investments were fully funded by QT Imaging Board members, and **$200,000** by Mr. Leon Recanati, Vice Chairman of the Israel Cancer Association[6](index=6&type=chunk)[7](index=7&type=chunk) [Summary of Second Quarter 2025 Financial Results](index=2&type=section&id=Summary%20of%20Second%20Quarter%202025%20Financial%20Results) QT Imaging reported Q2 2025 revenue of **$3.7 million** with a **50% gross margin**, improved Adjusted EBITDA, but a net loss impacted by warrant liability changes [Revenue and Gross Margin](index=2&type=section&id=Revenue%20and%20Gross%20Margin) QT Imaging reported Q2 2025 revenue of **$3.7 million**, marking significant year-over-year and sequential growth, primarily driven by increased scanner shipments. Gross margin remained strong at **50%**, with a slight decline attributed to inventory cost variability Q2 2025 Revenue and Growth | Metric | Q2 2025 | YoY Growth | QoQ Growth | | :----- | :------ | :--------- | :--------- | | Revenue | $3.7M | 113% | 31% | - The year-over-year increase in revenue was primarily attributable to the shipment of eight QT Breast Acoustic CT™ scanners in Q2 2025, compared to four in Q2 2024[10](index=10&type=chunk) Q2 Gross Margin | Metric | Q2 2025 | Q2 2024 | | :---------- | :------ | :------ | | Gross Margin | 50% | 51% | - The slight decline in gross margin was primarily attributable to variability in the weighted average cost related to the Company's existing inventory during the quarter[10](index=10&type=chunk) [Operating Expenses and Net Loss](index=2&type=section&id=Operating%20Expenses%20and%20Net%20Loss) Total operating expenses for Q2 2025 improved by **7%** year-over-year. However, the company reported a net loss of **$4.0 million**, significantly impacted by a **$2.8 million** change in the fair value of warrant liability and interest expenses Q2 Operating Expenses and Net Loss | Metric | Q2 2025 | Q2 2024 | Change | | :------------------- | :------------- | :------------- | :----- | | Total Operating Expenses | $2.9 million | $3.1 million | -7% | | Net Loss | $(4.0) million | $(1.2) million | | - The net loss for Q2 2025 includes a **$2.8 million** change in the fair value of warrant liability, a **$0.2 million** change in the fair value of earnout liability, and interest expenses of **$0.4 million**[10](index=10&type=chunk)[11](index=11&type=chunk) [Non-GAAP Adjusted EBITDA & Cash Position](index=3&type=section&id=Non-GAAP%20Adjusted%20EBITDA%20%26%20Cash%20Position) QT Imaging's Non-GAAP Adjusted EBITDA improved significantly to **$(0.8) million** in Q2 2025 from **$(2.1) million** in Q2 2024. The company's cash balance increased to **$4.3 million** as of August 6, 2025, following collections for scanner shipments Q2 Non-GAAP Adjusted EBITDA | Metric | Q2 2025 | Q2 2024 | | :----------------- | :------------- | :------------- | | Non-GAAP Adjusted EBITDA | $(0.8) million | $(2.1) million | Cash Position | Date | Cash Balance | | :------------- | :----------- | | June 30, 2025 | $2.0 million | | August 6, 2025 | $4.3 million | - Net cash used in operating activities during Q2 2025 was **$1.5 million**, compared to **$1.0 million** in Q2 2024[14](index=14&type=chunk) [Amendments to Warrant Agreements](index=3&type=section&id=Amendments%20to%20Warrant%20Agreements) QT Imaging amended warrant agreements with Lynrock Lake and Yorkville on June 11, 2025, revising treatment upon acquisition and resulting in equity-classified warrants [Lynrock Lake Warrant Amendment](index=3&type=section&id=Lynrock%20Lake%20Warrant%20Amendment) On June 11, 2025, QT Imaging and Lynrock Lake amended their warrant agreement to revise the treatment of warrants upon an acquisition, ensuring the holder receives equivalent consideration in certain acquisition scenarios. This amendment resulted in equity-classified warrants for accounting purposes - The Lynrock Lake Warrant was amended on June 11, 2025, to revise the treatment of warrants upon an Acquisition, ensuring the holder receives equivalent consideration in Cash/Public Acquisition scenarios[14](index=14&type=chunk) - The Amended Lynrock Lake Warrant is exercisable until February 26, 2035, and resulted in equity-classified warrants for accounting purposes[14](index=14&type=chunk) [Yorkville Warrant Amendment](index=3&type=section&id=Yorkville%20Warrant%20Amendment) Also on June 11, 2025, the Yorkville Warrant was amended to revise its treatment upon an acquisition and to provide the holder with demand registration rights. Similar to the Lynrock Lake amendment, this also resulted in equity-classified warrants - The Yorkville Warrant was amended on June 11, 2025, to revise the treatment of warrants upon an Acquisition and to provide the holder with demand registration rights[14](index=14&type=chunk)[15](index=15&type=chunk) - The Amended Yorkville Warrant is exercisable until February 26, 2030, and resulted in equity-classified warrants for accounting purposes[15](index=15&type=chunk) [Financial Outlook](index=4&type=section&id=Financial%20Outlook) QT Imaging reiterates its 2025 and 2026 revenue projections of **$18 million** and **$27 million**, respectively, based on committed orders and distribution agreements [2025-2026 Revenue Projections](index=4&type=section&id=2025-2026%20Revenue%20Projections) QT Imaging reiterates its revenue projections, targeting **$18 million** in 2025 and **$27 million** in 2026, based on committed orders and minimum order quantities under its distribution agreement with NXC Imaging, Inc Revenue Projections | Year | Projected Revenue | Projected Scanner Shipments | | :--- | :---------------- | :-------------------------- | | 2025 | $18 million | 40 scanners | | 2026 | $27 million | 60 scanners | - These targets are in accordance with committed orders and minimum order quantities per the Amended Distribution Agreement with NXC Imaging, Inc., a wholly owned subsidiary of Canon Medical Systems USA[16](index=16&type=chunk) [Condensed Consolidated Financial Statements (Unaudited)](index=5&type=section&id=Condensed%20Consolidated%20Financial%20Statements%20(Unaudited)) This section presents the unaudited condensed consolidated financial statements, including statements of operations, EBITDA reconciliation, balance sheets, and cash flows for relevant periods [Statements of Operations](index=5&type=section&id=Statements%20of%20Operations) The unaudited condensed consolidated statements of operations for the three and six months ended June 30, 2025 and 2024 are presented below, detailing revenue, cost of revenue, operating expenses, and net loss Summary of Results for the Three and Six Months Ended June 30, 2025 and 2024 | | Three Months Ended | | Six Months Ended | | | --- | --- | --- | --- | --- | | | June 30, | | June 30, | | | $ thousands (except share and per share amounts) | 2025 | 2024 | 2025 | 2024 | | Revenue | $ 3,659 $ | 1,714 $ | 6,458 $ | 3,076 | | Cost of revenue | 1,832 | 839 | 2,819 | 1,442 | | Gross profit | 1,827 | 875 | 3,639 | 1,634 | | Operating expenses: | | | | | | Research and development | 901 | 925 | 1,753 | 1,567 | | Selling, general and administrative | 1,969 | 2,170 | 3,971 | 7,866 | | Loss from operations | (1,043) | (2,220) | (2,085) | (7,799) | | Interest expense, net | (379) | (1,095) | (1,070) | (1,694) | | Other income (expense), net | 9 | (187) | (8,740) | (208) | | Change in fair value of warrant liability | (2,796) | 214 | (3,501) | 191 | | Change in fair value of derivative liability | — | 1,729 | 101 | 4,713 | | Change in fair value of earnout liability | 210 | 310 | 160 | 2,920 | | Loss before income tax expense | (3,999) | (1,249) $ | (15,135) $ | (1,877) | | Income tax expense | 3 | — | 3 | — | | Net loss | (4,002) | (1,249) $ | (15,138) $ | (1,877) | | Less: deemed dividend related to the modification of equity | | | | | | classified warrants | — | (5,186) | — | (5,186) | | Net loss attributable to common stockholders | $ (4,002) $ | (6,435) $ | (15,138) $ | (7,063) | | Basic and diluted net loss per share | $ (0.14) $ | (0.30) $ | (0.54) $ | (0.41) | | Weighted average shares outstanding | 28,352,574 | 21,440,447 | 27,936,371 | 17,333,000 | [EBITDA and Adjusted EBITDA Reconciliation](index=6&type=section&id=EBITDA%20and%20Adjusted%20EBITDA%20Reconciliation) The unaudited reconciliation of Net Loss to EBITDA and Adjusted EBITDA for the three and six months ended June 30, 2025 and 2024 is provided, along with explanatory notes for the adjustments EBITDA and Adjusted EBITDA for the Three and Six Months Ended June 30, 2025 and 2024 | | Three Months Ended | | Six Months Ended | | | --- | --- | --- | --- | --- | | | June 30, | | June 30, | | | $ thousands | 2025 | 2024 | 2025 | 2024 | | Net loss | $ (4,002) $ | (1,249) $ | (15,138) $ | (1,877) | | Interest expense, net | 379 | 1,095 | 1,070 | 1,694 | | Income tax expense | 3 | — | 3 | — | | Depreciation and amortization | 38 | 86 | 76 | 185 | | EBITDA | (3,582) | (68) | (13,989) | 2 | | Adjustments: | | | | | | Stock-based compensation | 219 | — | 320 | 39 | | Warrant modification | — | 201 | — | 201 | | Debt modification and extinguishment expenses | (1) — | — | 2,124 | — | | (2) Change in fair value of warrants | 2,796 | (214) | 3,501 | (191) | | (3) Change in fair value of derivatives | — | (1,729) | (101) | (4,713) | | (4) Change in fair value of earnout liability | (210) | (310) | (160) | (2,920) | | (5) Transaction expenses | — | — | — | 4,301 | | (6) Debt issuance expense | — | — | 6,640 | — | | Adjusted EBITDA | $ (777) $ | (2,120) $ | (1,665) $ | (3,281) | - Notes provide details on debt modification/extinguishment expense, change in fair value of warrant liability (driven by stock price increase), decrease in fair value of derivative liability, earnout liability valuation, transaction expenses, and loss on issuance of Lynrock Lake Term Loan[23](index=23&type=chunk) [Balance Sheets](index=7&type=section&id=Balance%20Sheets) The unaudited condensed consolidated balance sheets as of June 30, 2025, and December 31, 2024, are presented, showing assets, liabilities, and stockholders' deficit Condensed Consolidated Balance Sheets as of June 30, 2025 and December 31, 2024 | | | June 30, | | December 31, | | --- | --- | --- | --- | --- | | $ in thousands | | 2025 | | 2024 | | Assets | | | | | | Current assets: | | | | | | Cash | $ | 2,022 | $ | 1,172 | | Restricted cash and cash equivalents | | 20 | | 20 | | Accounts receivable, net | | 3,651 | | 67 | | Inventory | | 3,231 | | 3,141 | | Prepaid expenses and other current assets | | 1,744 | | 517 | | Total current assets | | 10,668 | | 4,917 | | Non-current assets: | | | | | | Property and equipment, net | | 167 | | 196 | | Operating lease right-of-use assets | | 758 | | 935 | | Other assets | | 39 | | 39 | | Total assets | $ | 11,632 | $ | 6,087 | | Liabilities and Stockholders' Deficit | | | | | | Current liabilities: | | | | | | Accounts payable | $ | 1,596 | $ | 803 | | Accrued expenses and other current liabilities | | 4,211 | | 3,550 | | Current maturities of long-term debt | | 37 | | 4,986 | | Deferred revenue | | 34 | | 49 | | Operating lease liabilities, current | | 429 | | 406 | | Total current liabilities | | 6,307 | | 9,794 | | Non-current liabilities: | | | | | | Long-term debt | | 72 | | 9 | | Related party notes payable | | 3,849 | | 3,849 | | Operating lease liabilities | | 437 | | 657 | | Warrant liability | | 26 | | 22 | | Derivative liability | | — | | 304 | | Earnout liability | | 280 | | 440 | | Other liabilities | | 986 | | 550 | | Total liabilities | | 11,957 | | 15,625 | | Stockholders' deficit: | | | | | | Common stock | | 3 | | 3 | | Additional paid-in capital | | 46,751 | | 22,400 | | Accumulated deficit | | (47,079) | | (31,941) | | Total stockholders' deficit | | (325) | | (9,538) | | Total liabilities and stockholders' deficit | $ | 11,632 | $ | 6,087 | [Statements of Cash Flows](index=8&type=section&id=Statements%20of%20Cash%20Flows) The unaudited condensed consolidated statements of cash flows for the six months ended June 30, 2025 and 2024, detail cash flows from operating, investing, and financing activities Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2025 and 2024 | | | | Six Months Ended June 30, | | | --- | --- | --- | --- | --- | | $ in thousands | | 2025 | | 2024 | | Cash flows from operating activities: | | | | | | Net loss | $ | (15,138) | $ | (1,877) | | Adjustment to reconcile net loss to net cash used in operating activities: | | | | | | Depreciation and amortization | | 76 | | 185 | | Stock-based compensation | | 320 | | 39 | | Warrant modification expense | | — | | 201 | | Loss on issuance of the Lynrock Lake Term Loan | | 6,640 | | — | | Debt extinguishment loss | | 2,034 | | — | | Debt modification expense | | 90 | | — | | Provision for credit losses | | — | | 1 | | Fair value of common stock issued in exchange for services and in connection with non-redemption agreements | | — | | 3,718 | | Loss on issuance of common stock in connection with a subscription agreement | | — | | 206 | | Non-cash interest | | 548 | | 1,201 | | Non-cash operating lease income | | (19) | | (12) | | Change in fair value of warrant liability | | 3,501 | | (191) | | Change in fair value of derivative liability | | (101) | | (4,713) | | Change in fair value of earnout liability | | (160) | | (2,920) | | Changes in operating assets and liabilities: | | | | | | Accounts receivable | | (3,584) | | (669) | | Inventory | | (90) | | 1,353 | | Prepaid expenses and other current assets | | (1,227) | | (554) | | Accounts payable | | 772 | | (2,281) | | Accrued expenses and other current liabilities | | 939 | | 52 | | Deferred revenue | | (15) | | (316) | | Other liabilities | | 435 | | (378) | | Net cash used in operating activities | | (4,979) | | (6,955) | | Cash flows from investing activities: | | | | | | Purchases of property and equipment | | (47) | | (27) | | Net cash used in investing activities | | (47) | | (27) | | Cash flows from financing activities: | | | | | | Proceeds from sale of common stock and warrants | | 700 | | — | | Proceeds from issuance of common stock pursuant to subscription agreement, net of issuance costs | | — | | 500 | | Proceeds from long-term debt, net of issuance costs | | 10,000 | | 10,525 | | Repayment of long-term debt | | (4,674) | | (65) | | Repayment of bridge loans | | — | | (800) | | Payment of deferred issuance costs | | (150) | | — | | Proceeds from the Merger, net of transaction costs | | — | | 1,238 | | Net cash provided by financing activities | | 5,876 | | 11,398 | | Net increase in cash and restricted cash and cash equivalents | | 850 | | 4,416 | | Cash and restricted cash and cash equivalents at the beginning of period | | 1,192 | | 185 | | Cash and restricted cash and cash equivalents at the end of the period | $ | 2,042 | $ | 4,601 | [Legal & Regulatory Disclosures](index=9&type=section&id=Legal%20%26%20Regulatory%20Disclosures) This section provides disclosures on forward-looking statements, information for stockholders regarding the Annual Meeting, and explanations of non-GAAP financial measures [Forward-Looking Statements](index=9&type=section&id=Forward-Looking%20Statements) This section contains forward-looking statements regarding QT Imaging's future plans, products, and financial performance, which are subject to various risks and uncertainties. Actual results may differ materially from these statements, and the company disclaims any obligation to update them - The press release contains forward-looking statements about the QT Imaging Breast Acoustic CT™ Scanner, its commercialization, the evolution into a scalable imaging platform, the QTI Cloud Platform, and projected revenues[27](index=27&type=chunk) - These statements involve risks and uncertainties, and actual results may differ materially due to factors such as the ability to sell and deploy scanners, extend product offerings, commercialize technology, and changes in market conditions[27](index=27&type=chunk) - QT Imaging disclaims any obligation to update these forward-looking statements, and undue reliance should not be placed upon them[28](index=28&type=chunk) [Additional Information & Solicitation Participants](index=10&type=section&id=Additional%20Information%20%26%20Solicitation%20Participants) Stockholders are urged to review the proxy statement and other SEC filings for important information regarding the Annual Meeting. Information about the company's directors and executive officers, who may be deemed participants in the proxy solicitation, is also available - Stockholders are urged to read the proxy statement and other SEC filings for important information about the matters to be addressed at the Annual Meeting[29](index=29&type=chunk) - Information about the Company's directors and executive officers, who may be deemed participants in the solicitation of proxies, is set forth in the definitive proxy statement filed with the SEC[30](index=30&type=chunk) [Non-GAAP Financial Measures Explanation](index=10&type=section&id=Non-GAAP%20Financial%20Measures%20Explanation) This section clarifies the use of non-GAAP financial measures like EBITDA and Adjusted EBITDA, emphasizing they are supplemental to GAAP measures and should not be considered in isolation. It defines these measures and explains management's rationale for their use, while also highlighting their inherent limitations - Non-GAAP financial measures (EBITDA, Adjusted EBITDA) are presented to supplement GAAP financial statements and should not be considered in isolation or as a substitute for GAAP measures[31](index=31&type=chunk)[32](index=32&type=chunk) - EBITDA is defined as loss before interest expense, income tax expense, depreciation and amortization. Adjusted EBITDA further adjusts for stock-based compensation, changes in fair value of liabilities, transaction expenses, and debt-related expenses[35](index=35&type=chunk) - Management uses these non-GAAP measures to provide useful supplemental information, enable period-over-period comparisons, and offer greater transparency, despite their inherent limitations and potential differences from other companies' calculations[34](index=34&type=chunk)[35](index=35&type=chunk)[36](index=36&type=chunk) [About QT Imaging](index=12&type=section&id=About%20QT%20Imaging) QT Imaging Holdings, Inc. is a medical device company focused on developing and commercializing innovative body imaging systems using low-frequency sound waves [Company Overview](index=12&type=section&id=Company%20Overview) QT Imaging Holdings, Inc. is a medical device company focused on research, development, and commercialization of innovative body imaging systems using low-frequency sound waves. Its mission is to improve global health outcomes by providing safe, affordable, accessible, and patient-centered medical imaging - QT Imaging Holdings, Inc. is a medical device company engaged in research, development, and commercialization of innovative body imaging systems using low frequency sound waves[39](index=39&type=chunk) - The company's strategy is to improve global health outcomes by making medical imaging safe, affordable, accessible, and patient-centered[39](index=39&type=chunk)

Financial Performance - The company has incurred a net loss of $11,136,000 for the three months ended March 31, 2025, and has an accumulated deficit of $43,076,527[140]. - Revenue for Q1 2025 increased by 105% to $2,798,415 compared to $1,362,163 in Q1 2024, primarily due to the sale of six QT Breast Scanners[158]. - Cost of revenue rose by 64% to $986,553 in Q1 2025 from $602,083 in Q1 2024, attributed to the increased sales of QT Breast Scanners[160]. - Gross profit for Q1 2025 was $1,811,862, a 138% increase from $760,080 in Q1 2024[158]. - Net loss for Q1 2025 was $11,136,000, a significant increase from a loss of $628,590 in Q1 2024, reflecting an increase in other expenses[158]. - The company had an accumulated deficit of $43,076,527 as of March 31, 2025, up from $31,940,527 at the end of 2024[169]. Funding and Capital Requirements - The company continues to incur losses and will need to raise additional capital to achieve profitability[140]. - The company expects to incur significant expenses for research and development, particularly for the QT Breast Scanner, and plans to raise capital through equity issuance and borrowings[189]. - The company anticipates that future funding requirements will depend on various factors, including growth rate and timing of expenditures[190]. - Future funding requirements may increase significantly based on factors such as debt obligations, manufacturing expansion, and regulatory clearances for the QT Breast Scanner[191]. - The company expects to finance cash needs through a combination of public or private equity offerings, debt financings, and strategic partnerships[193]. - If additional funds are not raised, the company may need to delay or reduce product development and commercialization efforts[195]. Agreements and Partnerships - The company entered into a Distribution Agreement with NXC Imaging, appointing NXC as the exclusive reseller of QT Breast Scanners in the U.S. and U.S. territories[137]. - The company has entered into a Manufacturing Agreement with Canon Medical Systems, appointing them as the exclusive manufacturer of QT Breast Scanners[138]. - The Amended Distribution Agreement with NXC could generate cash inflows of up to $18 million in 2025 and $27 million in 2026[170]. - The company plans to build a U.S. sales and marketing team and has appointed NXC as the exclusive agent for the QT Breast Scanner in the U.S.[189]. Loans and Financial Obligations - The company has a senior secured term loan of $10,100,000 with an interest rate of 10.0% per annum, maturing on March 31, 2027[144]. - The Lynrock Lake Term Loan provided $10.1 million in principal, with $5.4 million net proceeds available for working capital after settling obligations[171]. - The Lynrock Lake Term Loan has an aggregate principal amount of $10,100,000 with an interest rate of 10.0% per annum, maturing on March 31, 2027[173]. - As of March 31, 2025, the outstanding amount of the Lynrock Lake Term Loan was $697, net of the unamortized debt discount of $10,099,303[179]. - The company recorded a loss of $6,640,384 upon issuance of the Lynrock Lake Term Loan, including debt issuance costs of $244,300[179]. - As of March 31, 2025, the outstanding amount of the 2020 Notes was $3,143,725 with accrued interest of $592,887[181]. Operational Insights - The company has delivered fourteen QT Breast Scanners to NXC and its customers as of March 31, 2025[137]. - The company expects to remain cash flow negative for the foreseeable future, although it may achieve positive cash flows in certain quarters[169]. - Net cash used in operating activities for the three months ended March 31, 2025 was $3,536,799, a decrease from $5,975,515 for the same period in 2024[185]. - Net cash provided by financing activities for the three months ended March 31, 2025 was $5,352,198, primarily due to $10,000,000 of net proceeds from the Lynrock Lake Term Loan[187]. Legal and Compliance - The company is subject to occasional lawsuits and claims, but management is not aware of any pending claims that will materially impact financial statements[199]. - The company leases its operating facilities in Novato, California, under a non-cancelable operating lease through May 31, 2027[198]. - The company is classified as an emerging growth company (EGC) under the JOBS Act, allowing it to delay adopting new accounting standards[200]. - The company will remain an EGC until it meets certain revenue or filing criteria, including total annual gross revenue of at least $1.235 billion[203]. - The company has no off-balance sheet arrangements during the periods presented[197]. Strategic Goals - The company plans to create disruptive technological innovations to improve medical imaging quality and access[139]. - The company aims to expand its market by supporting Direct-to-Customer and Direct-to-Patient approaches to lower healthcare costs[139]. - The company has modified the conversion price for its promissory note with Yorkville to $0.584 per share[142]. - The Lynrock Lake Warrant allows for the purchase of 61,000,000 shares at an exercise price of $0.40 per share, exercisable until February 26, 2035[178]. - The company may need to relinquish valuable rights to technologies or revenue streams if it raises funds through collaborations or licensing arrangements[194]. - The company is unable to estimate exact operating capital requirements due to numerous risks and uncertainties associated with manufacturing and commercialization of products[191].

Financial Performance - Commercial revenue for Q1 2025 was $2.8 million, a 100% increase from $1.4 million in Q1 2024, driven by the shipment of six Breast Acoustic CT scanners[5] - Gross margin improved to 65% in Q1 2025, up from 56% in Q1 2024 and 47% in Q4 2024, attributed to variability in inventory costs[5] - Net loss for Q1 2025 was $11.1 million, compared to a net loss of $0.6 million in Q1 2024 and $3.5 million in Q4 2024[5] - Net loss for the three months ended March 31, 2025, was $11,136 thousand, compared to a net loss of $629 thousand in the same period of 2024[20] - Adjusted EBITDA is used as a non-GAAP measure to provide insights into financial performance, but specific figures for this measure were not disclosed in the report[25] Cash Flow and Financing - Net cash used in operating activities was $3.5 million in Q1 2025, down from $6.0 million in Q1 2024[6] - Net cash used in operating activities decreased to $3,537 thousand in Q1 2025 from $5,976 thousand in Q1 2024, indicating improved cash flow management[20] - Cash and restricted cash and cash equivalents at the end of the period were $3,008 thousand, down from $5,640 thousand at the end of Q1 2024[20] - Proceeds from long-term debt in Q1 2025 were $10,000 thousand, compared to $10,525 thousand in Q1 2024, reflecting ongoing financing efforts[20] - The company closed a $10.1 million term loan with Lynrock Lake, with $5.4 million allocated for working capital[2][9] - The company received $0.7 million in PIPE investment from board members and other investors for working capital[1][9] Growth and Future Projections - The company aims to achieve $18 million in revenue for 2025 and $27 million for 2026, corresponding to the shipment of 40 and 60 scanners respectively[10] - The company anticipates future growth in product sales and revenues related to the QT Imaging Breast Acoustic CT™ Scanner, although specific projections were not provided[21] Operational Developments - The company entered into a contract manufacturing agreement with Canon Medical Systems Corporation to enhance production capabilities[2][9] - The company is focused on expanding its product offerings and improving operational efficiency to enhance market competitiveness[21] - QT Imaging is committed to addressing identified material weaknesses in internal controls over financial reporting to improve overall governance[21] Market Position and Risks - Management highlighted risks related to the commercialization of new products and the ability to attract qualified personnel, which could impact future performance[21] - The company successfully uplisted to the OTCQB Venture Market on March 11, 2025, after being suspended from Nasdaq trading[9] - The company emphasizes the importance of medical imaging technology in improving global health outcomes and patient experience[30]

Financial Performance and Profitability - The company has incurred significant operating losses in the past and may never achieve or maintain profitability[28] - The company has a limited operating history with its current offerings, making it difficult to evaluate future business prospects[28] - The company has incurred significant operating losses in the past and may never achieve or maintain profitability[28] - The company has a limited operating history with its current offerings, increasing the risk of investment[28] - The company does not anticipate paying dividends on common stock, affecting potential returns for investors[33] Product Development and Market Acceptance - The company is dependent on the successful commercial launch of the QT Scanner 2000 Model A, which must achieve widespread market acceptance to generate necessary revenue[28] - The successful commercial launch of the QT Breast Scanner is critical for generating necessary revenue[28] - The company may not successfully develop or introduce new products that achieve market acceptance, which could harm revenue[28] Competition and Market Risks - The company faces risks related to increased competition and the ability to manage growth profitably following the Business Combination[21] - The company faces risks related to increased competition and the ability to manage growth effectively[28] Capital and Financing Needs - The company may need to incur additional indebtedness or seek capital through new equity or debt financings to support business growth[28] - The company may need to incur additional indebtedness or seek capital through new equity or debt financings to support growth[28] - The company's common stock is now quoted on the OTC Markets OTCQB Venture Market tier, which may adversely affect its ability to raise additional financing[33] - The common stock is now quoted on the OTC Markets OTCQB Venture Market tier, which may depress stock price and affect capital raising efforts[33] Management and Operational Challenges - The management team has limited experience managing a publicly traded company, which could affect the company's transition and operations[33] - The management team has limited experience managing a publicly traded company, which could affect business operations[33] Regulatory and External Factors - Recent changes in the United States related to payment policies for imaging procedures could negatively impact the utilization of the company's imaging services[28] - Recent changes in U.S. payment policies for imaging procedures could negatively impact the utilization of the company's services[28] Technology and Infrastructure - The company relies on a combination of patents and trade secrets to protect its proprietary technologies, and failure to maintain these protections could adversely impact market competitiveness[33] - The company relies on third-party providers for internet infrastructure and any failure could adversely affect customer relationships[28]

Exhibit 99.1 QT Imaging Announces Fourth Quarter and Full Year 2024 Financial Results and Provides 2025/26 Outlook Generated Sales of Twelve Scanners with Revenue of Approx. $5 Million and with 54% Gross Margin in 2024 Announced Insiders PIPE investment of $2.56 Million, fully funded by the QTI Board of Directors members and Management Announced the Closing of $10.1 million Lynrock Lake Term Loan, of which $5.4 million is for Working Capital Purposes Announced Clearing of All Its Short-Term Debt Liabilities ...

Financial Performance - The company has incurred a net loss of $9,166,958 during the nine months ended September 30, 2024, with an accumulated deficit of $32,122,605[179]. - Revenue increased by $931,313 to $955,970 for the three months ended September 30, 2024, compared to $24,657 for the same period in 2023, primarily due to the sale of two QT Breast Scanners[195]. - Cost of revenue increased by $326,868 to $350,667 for the three months ended September 30, 2024, from $23,799 for the same period in 2023, attributed to the sale of two QT Breast Scanners[196]. - Net loss for the three months ended September 30, 2024, was $3,619,494, compared to a net loss of $1,375,939 for the same period in 2023, reflecting an increase of $2,243,555[198]. - Revenue increased to $4,032,168 for the nine months ended September 30, 2024, up from $35,404 in the same period of 2023, representing a change of $3,996,764[206]. - Cost of revenue rose to $1,792,234 for the nine months ended September 30, 2024, compared to $73,497 in 2023, an increase of $1,718,737[207]. - Gross profit improved to $2,239,934 for the nine months ended September 30, 2024, from a loss of $(38,093) in 2023, a change of $2,278,027[206]. - Net loss for the nine months ended September 30, 2024, was $(9,166,958), an increase of $(4,578,058) from a net loss of $(4,588,900) in 2023[206]. - Interest expense increased to $3,149,315 for the nine months ended September 30, 2024, up from $394,714 in 2023, a change of $2,754,601[213]. Research and Development - The company expects to continue investing in research and development, particularly for the QT Breast Scanner and a full-body scanner product candidate, which may lead to increased costs[190]. - Research and development expenses rose by $613,385 to $925,214 for the three months ended September 30, 2024, from $311,829 for the same period in 2023, mainly due to increased employee compensation and professional services costs[197]. - Research and development expenses increased by 130% to $2,492,842 for the nine months ended September 30, 2024, from $1,083,373 in 2023[208]. Financing and Capital - The company issued a Yorkville Note for a Pre-Paid Advance of $10 million, with a payment of $1,521,581 made to Yorkville on September 13, 2024[181]. - The Company entered into a PIPE agreement for the issuance of shares and warrants with an aggregate purchase price of $2,560,000, resulting in the issuance of 4,383,558 shares at $0.584 per share[185]. - The company plans to raise additional capital through equity issuance, borrowings, and potential strategic alliances to support commercialization efforts[242]. - The company expects to fund its current operating plan for at least the next 12 months through additional cash received from financing arrangements and revenues[217]. - Net cash provided by financing activities for the nine months ended September 30, 2024 was $10,220,475, primarily from $10,525,000 of net proceeds from long-term debt issuance and $1,238,530 from the Merger[239]. Operational Agreements - The company entered into a Distribution Agreement with NXC Imaging, appointing them as the exclusive reseller of QT Breast Scanners in the U.S. and U.S. territories[174]. - The company has entered into a Feasibility Study Agreement with Canon Medical Systems to evaluate the QT Breast Scanner's business and clinical values[177]. - The company plans to engage in a binding Original Equipment Manufacturer (OEM) agreement with Canon Medical Systems, targeting execution in Q4 2024[178]. Expenses and Liabilities - The company expects to incur additional recurring administrative expenses associated with being a publicly traded company, including compliance costs and audit fees[180]. - Selling, general and administrative expenses increased by $1,075,153 to $2,007,277 for the three months ended September 30, 2024, from $932,124 for the same period in 2023, driven by higher employee compensation and insurance costs[199]. - Selling, general and administrative expenses surged by 221% to $9,873,029 for the nine months ended September 30, 2024, compared to $3,072,720 in 2023[209]. - The company has outstanding Related Party Convertible Notes Payable amounting to $3,143,725 as of September 30, 2024, with accrued interest of $507,029[231]. - The Cable Car Loan outstanding amount as of September 30, 2024 was $1,247,374, net of issuance costs of $252,626[230]. Cash Flow and Financial Position - As of September 30, 2024, cash and cash equivalents were $1,564,169, significantly up from $184,686 as of December 31, 2023[215]. - Net cash used in operating activities for the nine months ended September 30, 2024 was $8,806,402, compared to $1,965,772 for the same period in 2023, primarily due to funding research and development and general administrative expenses[236]. - The company has a cash flow increase of $1,379,483 for the nine months ended September 30, 2024, compared to a decrease of $420,586 for the same period in 2023[235]. Regulatory and Compliance - The company is an emerging growth company (EGC) and intends to rely on exemptions provided by the JOBS Act, delaying the adoption of new accounting standards until certain conditions are met[252]. - The company has total annual gross revenue of at least $1.235 billion, which will affect its status as an EGC[255]. - The company is currently evaluating the impact of new accounting standards issued in November and December 2023 on its financial statements[266][267]. Legal and Tax Matters - The company is subject to occasional lawsuits and claims, but management is not aware of any pending claims that will materially impact financial statements[251]. - The company evaluates the realizability of deferred tax assets annually, considering future taxable income and available tax planning strategies[263]. - The company adopted ASU 2020-06 effective January 1, 2024, with no material impact on its financial statements[265]. Revenue Recognition - The company recognizes revenue when a customer obtains control of promised goods or services, with specific steps outlined for revenue recognition[258].