Financial Performance - Scanner sales revenue for Q3 2024 was $0.9 million, with a gross margin of 65%[1] - Total commercial revenue for Q3 2024 was $1.0 million, down from $1.7 million in Q2 2024 and less than $0.1 million in Q3 2023[7] - Net loss for Q3 2024 was $3.6 million, compared to a net loss of $1.4 million in Q3 2023[7] - Non-GAAP Adjusted EBITDA for Q3 2024 was $(2.2) million, compared to $(0.6) million in Q3 2023[7] - Operating cash used in Q3 2024 was $1.9 million, compared to $0.4 million in Q3 2023[7] - Net loss for the nine months ended September 30, 2024, was $9,166,000, compared to a net loss of $4,589,000 for the same period in 2023, indicating a 99.5% increase in losses[19] Financing Activities - The company completed a $2.56 million PIPE financing, executed by Board members, at a 10% premium to the prior five-day average trading price[4] - The principal balance of the convertible note was reduced to $8.6 million after a payment of approximately $1.5 million[3] - Proceeds from long-term debt, net of issuance costs, amounted to $10,525,000 during the nine months ended September 30, 2024[19] Assets and Liabilities - Total current assets increased to $5,778,000 as of September 30, 2024, compared to $4,819,000 on December 31, 2023, representing a 19.9% increase[18] - Total liabilities rose to $16,612,000 as of September 30, 2024, up from $12,018,000 at the end of 2023, reflecting a 38.2% increase[18] - Cash and restricted cash and cash equivalents at the end of the period were $1,564,000, a significant increase from $54,000 at the end of the previous year[19] - The company reported a decrease in inventory to $3,182,000 as of September 30, 2024, down from $4,418,000, marking a 28.0% reduction[18] Strategic Initiatives - The company signed a third-year renewal of its five-year research grant from the NIH/NCI during Q3 2024[9] - The company plans to maintain revenue pace in Q4 2024 with expected higher gross margins due to inventory cost adjustments[11] - The company anticipates future growth in product sales and projected revenues related to the QT Imaging Breast Acoustic CT™ Scanner[20] - QT Imaging's strategy focuses on improving global health outcomes through innovative body imaging systems using low-frequency sound waves[31] Internal Controls - The company has identified material weaknesses in internal controls over financial reporting, which may impact future financial results[20] Definitions - Adjusted EBITDA is defined as EBITDA further adjusted for stock-based compensation and changes in fair value of liabilities, providing insight into the company's financial performance[25]

Group 1 - QT Imaging Holdings reported earnings per share of -30 cents for the second quarter of 2024 [1] - The company generated revenue of $1.71 million during the same period [1]

Financial Performance - The company has incurred a net loss of $5,547,464 and used $6,955,081 of cash in operating activities during the six months ended June 30, 2024, with an accumulated deficit of $28,503,111 as of the same date[147]. - Net loss for the three months ended June 30, 2024, was $1,248,874, a decrease of $81,140 compared to a net loss of $1,330,014 in the same period in 2023[179]. - Revenue increased by $1,710,852 to $1,714,035 for the three months ended June 30, 2024, compared to $3,183 for the same period in 2023, primarily due to the sale of four QT Breast Scanners[175]. - Revenue for the six months ended June 30, 2024, increased by $3,065,451 to $3,076,198 from $10,747 in 2023, primarily due to the sale of seven QT Breast Scanners[186]. - Cost of revenue increased by $836,363 to $839,484 for the three months ended June 30, 2024, from $3,121 in the same period in 2023, driven by the sale of four QT Breast Scanners[176]. - Cost of revenue for the six months ended June 30, 2024, increased by $1,391,869 to $1,441,567 from $49,698 in 2023, driven by the sale of seven QT Breast Scanners[189]. - Selling, general and administrative expenses increased by $1,320,710 to $2,169,541 for the three months ended June 30, 2024, from $848,831 in 2023, attributed to higher professional services and employee compensation costs[178]. - Selling, general and administrative expenses for the six months ended June 30, 2024, increased by $5,725,156 to $7,865,752 from $2,140,596 in 2023, largely due to non-recurring transaction expenses related to the business combination[191]. - Interest expense, net increased by $1,432,139 to $1,694,009 for the six months ended June 30, 2024, from $261,870 in 2023, primarily due to increased amortization of debt discount[194]. Financing Activities - The company raised a private secured convertible bridge financing of $1,000,000 on November 10, 2023, with four of the five investors opting for cash repayment totaling $960,000, while one investor converted $200,000 into 100,000 shares of common stock[151][152]. - On November 15, 2023, the company entered into a Standby Equity Purchase Agreement allowing the sale of up to $50 million of common stock over 36 months following the Business Combination[155]. - The company received a Pre-Paid Advance of $9,025,000 from Yorkville, accruing interest at 6%, with a potential increase to 18% upon default[155]. - The company raised $1,000,000 through a private secured convertible bridge financing, with $960,000 paid to four of the five Bridge Loan holders on the Merger Date[203]. - Net cash provided by financing activities was $11,398,512 for the six months ended June 30, 2024, primarily due to proceeds from the Yorkville Pre-Paid Advance and the Cable Car Loan[215]. - The company received a Pre-Paid Advance of $9,025,000 from Yorkville and $1,500,000 from Cable Car, with an additional $40 million available through the Standby Equity Purchase Agreement[197]. - The outstanding amount of the Cable Car Loan as of June 30, 2024, was $1,138,668, net of issuance costs[206]. - The company issued convertible notes with a total outstanding amount of $3,143,725 as of June 30, 2024, with accrued interest of $463,629[208]. Research and Development - The company expects research and development expenses to increase substantially as it invests in the QT Breast Scanner and a full-body scanner for orthopedic and pediatric use[170]. - The company expects to continue investing in product development, which may significantly affect future research and development costs[171]. - The company anticipates that its cost of revenue will increase in absolute dollars but decrease as a percentage of revenues over time due to new manufacturing processes[169]. - The company plans to engage in a good faith discussion to develop a binding Original Equipment Manufacturer (OEM) agreement with Canon Medical Systems, targeting execution in the second half of 2024[146]. - The company has entered into a Feasibility Study Agreement with Canon Medical Systems to evaluate the business, technical, and clinical values of the QT Breast Scanner, which will remain in force until the end of December 2024[145]. - The company aims to improve healthcare quality and access through disruptive innovation in medical imaging technology, including artificial intelligence and smart physics[142]. Operational Challenges - The company has been operating with negative cash flows since inception and will need to continue raising additional capital to achieve profitability[147]. - The company’s future capital requirements will depend on growth rate and spending for research and development, with potential challenges in raising additional financing[198]. - Future funding requirements will depend on factors such as cash availability for debt obligations, manufacturing expansion, and regulatory clearance costs[219]. - If financing is not available at acceptable levels, the company may need to reduce operating expenses or delay development programs[218]. - The company is subject to risks that could significantly increase operating capital requirements, including costs associated with product sales and regulatory reviews[219]. Internal Controls and Compliance - The company identified a material weakness in internal control over financial reporting due to lack of segregation of duties around key accounting processes, attributed to limited personnel resources[243]. - A second material weakness was identified related to technical accounting aspects of certain material transactions during the review of condensed consolidated financial statements for the three months ended March 31, 2024[243]. - Remedial measures have been initiated, including implementing technology, hiring personnel, and engaging external resources to address the identified weaknesses[243]. - No misstatements were found in the condensed consolidated financial statements as of June 30, 2024, despite the identified material weaknesses[244]. - There were no changes in internal control over financial reporting that materially affected the company's internal controls during the three months ended June 30, 2024[245]. - The effectiveness of internal control systems is subject to inherent limitations, including the exercise of judgment and resource constraints[246]. - The company plans to continue monitoring and upgrading internal controls as necessary but cannot assure that improvements will be sufficient for effective internal control over financial reporting[246]. Legal and Regulatory Matters - The company is not currently subject to any material legal proceedings, nor are any threatened against it or its officers[248]. - The company is classified as an emerging growth company, allowing it to delay adopting new accounting standards until certain conditions are met[225]. - Recent accounting standards updates adopted by the company had no material impact on its financial statements[237]. - The company is evaluating the impact of new accounting standards on its financial disclosures, effective for fiscal years beginning after December 15, 2023[238][239]. - The company is a smaller reporting company and is not required to provide certain market risk disclosures[240]. Manufacturing and Distribution - The company has focused on small-scale manufacturing internally while partnering for large-scale manufacturing to support market expansion[142]. - 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, with four QT Breast Scanners delivered to NXC's customers as of June 30, 2024[142][144]. - The company entered into a Distribution Agreement with NXC, appointing them as the exclusive reseller for certain equipment in the U.S. until December 31, 2025[167]. - The company leases its operating facilities in Novato, California, under a non-cancelable lease through May 31, 2027[223].

Financial Performance - Commercial revenue for Q2 2024 was $1.7 million, up from $1.4 million in Q1 2024 and significantly higher than less than $0.1 million in Q2 2023[3] - Gross margin in Q2 2024 was 51%, down from 56% in Q1 2024, attributed to variability in the weighted average cost of existing inventory[3][4] - Net loss for Q2 2024 was $1.2 million, compared to a net loss of $1.3 million in Q2 2023[4] - Non-GAAP Adjusted EBITDA for Q2 2024 was $(2.1) million, compared to $(0.7) million in Q2 2023[4] - Net loss for the three months ended June 30, 2024, was $1,249 thousand, compared to a loss of $1,330 thousand for the same period in 2023, representing a 6% improvement[12] - Adjusted EBITDA for the six months ended June 30, 2024, was $(3,281) thousand, compared to $(1,739) thousand for the same period in 2023, indicating a decline of 88%[12] - The company reported a net cash usage of $1.0 million in operating activities during Q2 2024, compared to $0.5 million in Q2 2023[4] - The company reported a net cash used in operating activities of $(6,955) thousand for the six months ended June 30, 2024, compared to $(1,521) thousand for the same period in 2023[17] Assets and Liabilities - Total current assets increased to $9,494 thousand as of June 30, 2024, up from $4,819 thousand at December 31, 2023, reflecting a 97% growth[15] - Cash and restricted cash and cash equivalents at the end of the period were $4,601 thousand, compared to $256 thousand at the end of the same period in 2023, marking a significant increase of 1,800%[17] - Total liabilities rose to $16,939 thousand as of June 30, 2024, compared to $12,018 thousand at December 31, 2023, representing a 41% increase[15] Business Developments - The company delivered four Breast Acoustic CT scanners in Q2 2024, increasing the number of commercial locations in the U.S. to five[2] - A partnership was signed with the University of Oklahoma and OU Health Stephenson Cancer Center to enhance cancer detection and treatment precision[1][2] - A distribution agreement was established with NXC Imaging, Inc. for exclusive resale of QT Breast Acoustic CT Scanners in the U.S.[5][7] - The company plans to commercialize the QT Imaging Breast Acoustic CT™ Scanner, with expectations for product sales growth and projected revenues[18] Research and Development - Research and development expenses for Q2 2024 were $0.9 million, up from $0.3 million in Q2 2023[10] Future Outlook - The company plans to maintain revenue growth in the second half of 2024, expecting higher gross margins due to inventory cost stabilization[8] - The company anticipates future developments may change its assessments and outlook, emphasizing the uncertainty of projected financial information[18] Non-GAAP Measures - QT Imaging reported that EBITDA is defined as loss before interest expense, income tax expense, depreciation, and amortization[23] - Adjusted EBITDA is further adjusted for equity-based compensation, net change in fair value of derivative, earnout and warrant liabilities, and transaction expenses[23] - The company does not provide guidance for net income (loss) or reconciliation of Adjusted EBITDA guidance due to unpredictability of certain GAAP components[25] - Management uses EBITDA and Adjusted EBITDA as non-GAAP performance measures, which are reconciled to net loss in accompanying tables[25] - There are material limitations associated with the use of non-GAAP financial measures, as they exclude significant expenses and income required by GAAP[24] - The company does not consider non-GAAP measures in isolation or as alternatives to GAAP measures[24] Company Mission - QT Imaging is focused on the research, development, and commercialization of innovative body imaging systems using low frequency sound waves[27] - The company emphasizes that medical imaging should be safe, affordable, accessible, and centered on the patient's experience[27] - QT Imaging aims to improve global health outcomes through its innovative imaging technology[27]

Table of Contents As filed with the U.S. Securities and Exchange Commission on May 17, 2024. Registration No. 333-278460 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Amendment No. 3 to 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) Delaware 6770 85-1728920 (Primary Standard Industrial Classification Code No.) (I.R.S. Empl ...

Table of Contents As filed with the U.S. Securities and Exchange Commission on May 17, 2024. Registration No. 333-278460 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Amendment No. 3 to 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) Delaware 6770 85-1728920 (Primary Standard Industrial Classification Code No.) (I.R.S. Empl ...

Table of Contents As filed with the U.S. Securities and Exchange Commission on May 16, 2024. Registration No. 333-278460 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Amendment No. 2 to FORM S-1 REGISTRATION STATEMENT (Exact Name of Registrant as Specified in its Charter) (State or Other Jurisdiction of Incorporation or Organization) Delaware 6770 85-1728920 (Primary Standard Industrial Classification Code No.) (I.R.S. Employer Identification No.) Dr. Raluca Dinu Chief Executive Of ...

Table of Contents As filed with the U.S. Securities and Exchange Commission on May 16, 2024. Registration No. 333-278460 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Amendment No. 2 to 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) Delaware 6770 85-1728920 (Primary Standard Industrial Classification Code No.) (I.R.S. Empl ...

Financial Performance - The company has incurred a net loss of $4,298,590 and used $5,975,515 in cash for operating activities during the three months ended March 31, 2024, contributing to an accumulated deficit of $22,068,735 [174]. - Revenue increased to $1,362,163 for Q1 2024, up from $7,564 in Q1 2023, primarily due to the sale of three QT Breast Scanners [212]. - Cost of revenue rose to $602,083 in Q1 2024, compared to $46,577 in Q1 2023, driven by the same scanner sales [213]. - Net loss for Q1 2024 was $4,298,590, compared to a loss of $1,882,947 in Q1 2023, reflecting a 128% increase in losses [211]. - As of March 31, 2024, the accumulated deficit was $22,068,735, up from $17,770,145 as of December 31, 2023 [222]. - Interest expense increased to $598,959 in Q1 2024 from $130,282 in Q1 2023, primarily due to higher amortization of debt discounts [221]. - Net cash used in operating activities for the three months ended March 31, 2024 was $5,975,515, significantly higher than $992,716 for the same period in 2023 [240][241]. - Net cash provided by financing activities for the three months ended March 31, 2024 was $11,431,060, primarily due to $10,525,000 from long-term debt issuance and $1,238,530 from the Merger [244]. Funding and Financial Support - The company received nearly $18 million in financial support from the U.S. National Institutes of Health to develop a novel body imaging technology [167]. - The company raised $1,000,000 through a private secured convertible bridge financing, with four of five investors opting for cash repayment totaling $960,000 [178]. - A pre-paid advance of $9,025,000 was received from Yorkville, accruing interest at 6% annually, convertible into shares of common stock [182]. - The company received a Pre-Paid Advance of $10,000,000 from Yorkville in March 2024, with an outstanding amount of $2,227,062 as of March 31, 2024 [232]. - Future funding requirements will depend on various factors, including the progress of trials and regulatory approvals for the QT Breast Scanner [248]. - The company expects to finance cash needs through public or private equity offerings, debt financings, and strategic partnerships [250]. Business Development and Agreements - The company entered into a Sales Agent Agreement with NXC Imaging for the sale of QT Imaging products in the U.S. and U.S. territories, with one QT Breast Scanner delivered as of March 31, 2024 [170]. - A non-binding letter of intent was signed with Canon Medical Systems for the acquisition of two QT Breast Scanners, with 50% of the payment completed by January 31, 2024 [171]. - The company has engaged in a Feasibility Study Agreement with Canon to evaluate the QT Breast Scanner's business, technical, and clinical values, lasting until December 2024 [172]. - A Data Use and License Agreement was established with QT Imaging Center for the use of de-identified health information in research related to the QT Ultrasound Breast Scanner [198]. - QTI Holdings entered into a Standby Equity Purchase Agreement allowing the sale of up to $50.0 million in common stock over 36 months following the Business Combination [182]. Research and Development - Research and development expenses are expected to increase substantially as the company invests in the development of the QT Breast Scanner and a full-body scanner for orthopedic and pediatric use [205]. - Research and development expenses increased by 52% to $642,546 in Q1 2024 from $421,887 in Q1 2023, mainly due to higher employee compensation costs [214]. - The company plans to incur substantial costs for research and development, regulatory clearances, and building a U.S. sales and marketing team [246]. Operational Expenses - Selling, general and administrative expenses are anticipated to rise to support expanding headcount, public company operations, and commercialization efforts [209]. - Selling, general and administrative expenses surged by 341% to $5,696,211 in Q1 2024 from $1,291,765 in Q1 2023, largely due to transaction expenses related to a business combination [215]. Accounting and Compliance - The company prepares its condensed consolidated financial statements in accordance with GAAP, requiring estimates and judgments that may materially affect reported amounts of assets, liabilities, revenues, and expenses [260]. - Revenue is recognized when a customer obtains control of promised goods or services, reflecting the consideration expected to be received [262]. - The company identifies performance obligations based on distinct goods or services that can benefit the customer, including product sales, maintenance contracts, and other services [265]. - Inventory is stated at the lower of cost or net realizable value, with periodic reviews leading to write-offs for obsolete items [269]. - The company accounts for leases as operating leases, recording right-of-use assets and lease liabilities on the balance sheet [270]. - Deferred tax assets and liabilities are determined based on differences between financial reporting and tax basis, evaluated annually for realizability [272]. - Stock-based compensation is measured at grant date fair market value and recognized as expense over the requisite service period [275]. - The company adopted ASU 2020-06 effective January 1, 2024, with no material impact on financial statements [276]. - ASU No. 2023-07, effective after December 15, 2023, requires improved segment disclosures, currently under evaluation for impact [277]. - ASU 2023-09, effective after December 15, 2024, aims to enhance income tax disclosures, with the company planning to adopt it on a prospective basis [278]. Legal and Regulatory Matters - The company is subject to occasional lawsuits, but management is not aware of any pending claims that will materially impact financial statements [256]. - The company is classified as an emerging growth company under the JOBS Act, allowing it to delay adopting new accounting standards [257]. - The company may need to relinquish rights to technologies or revenue streams if it raises funds through collaborations or partnerships [251].

Financial Performance - Commercial revenue for Q1 2024 was $1.4 million, a significant increase from less than $0.1 million in Q1 2023[8] - Gross margin improved to 56% in Q1 2024, compared to a negative margin in Q1 2023, due to the sale of three QT Breast Scanners[8] - Net loss for Q1 2024 was $4.3 million, which included $1.9 million of net non-cash income related to the change in fair value of warrants and transaction expenses of $4.3 million[10] - Non-GAAP Adjusted EBITDA for Q1 2024 was $(1.2) million, slightly worse than $(1.1) million in Q1 2023[10] - Net loss for the three months ended March 31, 2024, was $4,299,000, compared to a net loss of $1,883,000 for the same period in 2023, reflecting a deterioration of 128%[21] - The company reported net cash used in operating activities of $5,976,000 for the three months ended March 31, 2024, compared to $993,000 for the same period in 2023[21] - Net cash provided by financing activities was $11,431,000 for the three months ended March 31, 2024, compared to $916,000 in the same period of 2023[21] Assets and Liabilities - Total assets increased to $12,857,000 as of March 31, 2024, compared to $6,706,000 on December 31, 2023, representing an increase of 92%[19] - Current assets rose significantly to $11,433,000, up from $4,819,000, marking an increase of 137%[19] - Total liabilities increased to $17,772,000 as of March 31, 2024, compared to $12,018,000 at the end of 2023, an increase of 48%[19] - Long-term debt increased significantly to $3,331,000 from $96,000, a rise of 3,373%[19] - Cash and cash equivalents at the end of the period increased to $5,640,000 from $398,000, a rise of 1,316%[21] Strategic Developments - The company completed its merger with GigCapital5 on March 4, 2024, enhancing its strategic position[2] - The first commercial sale of a QT Breast Scanner occurred on March 7, 2024, to True Health Center for Functional Medicine[10] - A feasibility study agreement was initiated on March 28, 2024, to evaluate the business and clinical values of the QT Breast Scanner[10] - The company is focused on the commercialization and further development of the QT Imaging Breast Acoustic CT™ Scanner, with plans for new product development and introduction[22] Leadership and Guidance - Leadership updates include the appointment of Dr. Raluca Dinu as Acting CEO and the onboarding of Steve Choate as Chief Operating Officer[12] - The company plans to provide guidance for the remainder of 2024 as part of the Q2 2024 earnings release[12] Technology and Market Risks - A study published in Academic Radiology indicated that QT Imaging technology is similarly effective as digital breast tomosynthesis (DBT) for breast lesion detection[11] - QT Imaging anticipates potential risks related to the commercialization of its technology and market conditions, which could impact future performance[22]