Agreement strengthens Canadian veterinarians' access to Zomedica's advanced therapeutic and monitoring solutions ANN ARBOR, MI / ACCESS Newswire / September 10, 2025 / Zomedica Corp. (OTCQB:ZOMDF), a veterinary health company offering point-of-care diagnostic and therapeutic products for equine and companion animals, announced today that it has expanded its distribution agreement with UXR Inc., a leading Canadian animal health company focused on supporting the needs of veterinarians across Canada. Under the ...

Summary of Zomedica (ZOM) Conference Call - August 07, 2025 Company Overview - **Company**: Zomedica Corporation - **Ticker Symbol**: ZOMDF (OTCQB Venture Market) - **Industry**: Animal Health and Veterinary Services Key Points and Arguments 1. **Market Opportunity**: The total addressable market for Zomedica exceeds $2.7 billion annually, with the veterinary services segment in the U.S. valued at over $62 billion and growing [4][6]. 2. **Revenue Growth**: Zomedica has reported an increase in year-over-year revenues for 18 consecutive quarters, with revenues rising from $1 million in 2020 to $27 million in the last year [27][28]. 3. **Product Portfolio**: The company has developed six proprietary technology platforms aimed at improving veterinary care and practice profitability [4][5]. 4. **Capital and Liquidity**: Zomedica has $59 million in capital to support growth towards profitability [5][28]. 5. **High Margins**: The company maintains gross margins between 67% to 70%, with a focus on manufacturing its products to control costs [28][34]. 6. **Recurring Revenue Model**: A significant portion of revenue comes from consumable products, with nearly 70% of revenue from the PulseVet system derived from reorders of handpieces [13][14]. 7. **Innovative Technologies**: Key products include: - **PulseVet**: A shockwave therapy system generating significant revenue [10][11]. - **Assisi Loop**: A targeted pulse electromagnetic field therapy device, contributing about one-third of revenue from reorders [17][18]. - **Vetagel Hemostatic Gel**: A fast-acting gel for stopping bleeding, licensed for distribution in the U.S. [19][20]. - **TrueView Microscope**: A digital microscopy platform with AI capabilities, enhancing diagnostic capabilities for veterinarians [21][50]. - **TruForm Platform**: A diagnostic device utilizing bulk acoustic wave sensors, showing over 75% growth this year [22][23]. - **VetGuardian**: A pet monitoring device that provides vital signs without attachments, enhancing post-surgery care [24][25]. 8. **International Expansion**: Approximately 20% of revenue comes from international markets, with a 13% growth in international sales last quarter [30]. 9. **Future Growth Strategy**: Focus on leveraging commercial infrastructure, expanding product portfolio, and pursuing M&A opportunities while maintaining high margins [29][33]. 10. **Market Positioning**: The company believes it is undervalued, with a negative enterprise value despite significant revenue growth and potential [46][47]. Additional Important Insights - **COVID-19 Impact**: The pandemic led to an increase of 23 million pets in households, expanding the market for veterinary services [7]. - **Veterinary Challenges**: Veterinarians face staffing shortages and revenue loss to online competitors, which Zomedica aims to address with its products [9]. - **Economic Model**: The economic model for veterinarians using Zomedica's products is favorable, allowing them to achieve profitability quickly [15][16]. - **R&D and M&A Balance**: The company is shifting focus from R&D to scaling commercial adoption while still considering M&A opportunities for growth [39][40]. - **Future Product Launches**: New product launches are expected to enhance revenue and market presence, with AI integration in diagnostic tools [50][51]. This summary encapsulates the key insights from the Zomedica conference call, highlighting the company's market position, growth strategies, and innovative product offerings in the veterinary sector.

[Zomedica Announces Second Quarter 2025 Financial Results](index=1&type=section&id=Zomedica%20Announces%20Second%20Quarter%202025%20Financial%20Results) [Executive Summary & Key Highlights](index=1&type=section&id=1.1.%20Executive%20Summary%20%26%20Key%20Highlights) Zomedica reported strong Q2 2025 results with record revenue growth for the 18th consecutive quarter, driven by therapeutic and diagnostic product adoption - Zomedica achieved its **18th consecutive quarter** of record year-over-year revenue growth[1](index=1&type=chunk)[2](index=2&type=chunk) Q2 2025 Key Financial Highlights | Metric | Q2 2025 | Change YoY | Source | | :----- | :------ | :--------- | :----- | | Revenue | $7.0 million | +14% | [1, 9] | | Gross Margin | 67% | N/A | [1, 6] | | Operating Expenses Reduction | $0.7 million | -5% (adjusted) | [7, 14] | | Liquidity (Cash, Equivalents, Securities) | $59.1 million | N/A | [1, 20] | [Strategic Initiatives and Product Enhancements](index=1&type=section&id=1.2.%20Strategic%20Initiatives%20and%20Product%20Enhancements) The company advanced its product portfolio and market presence through international expansion, a new Equine Asthma registry, and platform enhancements - International sales grew by **13%** compared to Q2 2024, driven by organic growth and new distributor partnerships[4](index=4&type=chunk) - Launched a national Equine Asthma registry which provides a low-cost way to accumulate data to support expanded usage of the PulseVet system[4](index=4&type=chunk) - Introduced an enhanced **TRUFORMA® T4 assay** and a **VetGuardian® onboarding app**, with additional enhancements planned for VetGuardian and TRUVIEW® platforms in the upcoming quarter[5](index=5&type=chunk) [2025 Second Quarter Financial Performance](index=1&type=section&id=2025%20Second%20Quarter%20Financial%20Performance) [Revenue Overview](index=1&type=section&id=2.1.%20Revenue%20Overview) Total revenue increased 14% year-over-year to $7.0 million, propelled by strong growth in the Diagnostics segment and consumable sales Q2 2025 Revenue Performance | Metric | Q2 2025 Revenue | Q2 2024 Revenue | YoY Change | Source | | :----- | :-------------- | :-------------- | :--------- | :----- | | Total Revenue | $7.0 million | $6.1 million | +14% | [9, 13] | [Revenue by Product Segment](index=1&type=section&id=2.1.1.%20Revenue%20by%20Product%20Segment) The Diagnostics segment grew 86% year-over-year, driven by TRUFORMA platform adoption, while the Therapeutic Device segment grew 8% Q2 2025 Revenue by Product Segment | Segment | Q2 2025 Revenue | YoY Change | Primary Driver | Source | | :-------- | :-------------- | :--------- | :------------- | :----- | | Diagnostics | $0.8 million | +86% | TRUFORMA point-of-care diagnostic platform, expanded menu of assays | [3, 9, 10] | | Therapeutic Device | $6.2 million | +8% | PulseVet® and Assisi® products | [10, 11] | [Revenue by Product Category](index=1&type=section&id=2.1.2.%20Revenue%20by%20Product%20Category) Consumable revenues grew 21% year-over-year, led by TRUFORMA and PulseVet products, while capital revenues remained flat Q2 2025 Revenue by Product Category | Category | Q2 2025 Revenue | YoY Change | Primary Driver | Source | | :------- | :-------------- | :--------- | :------------- | :----- | | Consumables | $5.3 million | +21% | TRUFORMA products, PulseVet® trodes | [3, 21] | | Capital | $1.7 million | Flat | N/A | [21] | [Gross Margin](index=1&type=section&id=2.2.%20Gross%20Margin) Zomedica maintained a strong gross margin of 67% for the second quarter of 2025 Q2 2025 Gross Margin | Metric | Q2 2025 | | :----- | :------ | | Gross Margin | 67% | [Operating Expenses](index=2&type=section&id=2.3.%20Operating%20Expenses) Total operating expenses decreased significantly due to the non-recurrence of a prior-year impairment charge, with a 5% adjusted reduction Q2 2025 Operating Expenses | Metric | Q2 2025 | Q2 2024 | YoY Change | Source | | :----- | :------ | :------ | :--------- | :----- | | Total Operating Expenses | $12.7 million | $29.4 million | -56.8% | [14] | | Total Operating Expenses (Excl. Impairment) | $12.7 million | $13.4 million (adjusted) | -5% | [14] | | Impairment Charge (Q2 2024) | N/A | $16.0 million | N/A | [14] | [Research and Development (R&D) Expenses](index=2&type=section&id=2.3.1.%20Research%20and%20Development%20%28R%26D%29%20Expenses) R&D expenses increased by 25% year-over-year, reflecting continued investment in internal product development capabilities Q2 2025 R&D Expenses | Metric | Q2 2025 | Q2 2024 | YoY Change | Source | | :----- | :------ | :------ | :--------- | :----- | | R&D Expenses | $1.9 million | $1.5 million | +25% | [15] | - The increase was driven by costs related to building internal capabilities for developing next-generation therapeutic and diagnostic products[15](index=15&type=chunk) [Selling and Marketing (S&M) Expenses](index=2&type=section&id=2.3.2.%20Selling%20and%20Marketing%20%28S%26M%29%20Expenses) S&M expenses rose by 19% year-over-year due to increased sales headcount and higher commissions from sales growth Q2 2025 S&M Expenses | Metric | Q2 2025 | Q2 2024 | YoY Change | Source | | :----- | :------ | :------ | :--------- | :----- | | S&M Expenses | $4.6 million | $3.9 million | +19% | [16] | - The increase was primarily driven by a larger sales department headcount and higher commissions associated with sales growth[16](index=16&type=chunk) [General and Administrative (G&A) Expenses](index=2&type=section&id=2.3.3.%20General%20and%20Administrative%20%28G%26A%29%20Expenses) G&A expenses decreased by 23% year-over-year, mainly due to non-recurring prior-year fees and reduced salary costs Q2 2025 G&A Expenses | Metric | Q2 2025 | Q2 2024 | YoY Change | Source | | :----- | :------ | :------ | :--------- | :----- | | G&A Expenses | $6.2 million | $8.0 million | -23% | [17] | - The decrease was primarily driven by the non-recurrence of prior-year special meeting and impairment-related accounting fees, as well as lower salary and severance expenses[17](index=17&type=chunk) [Net Loss and Profitability](index=2&type=section&id=2.4.%20Net%20Loss%20and%20Profitability) The company significantly reduced its net loss to $7.4 million from $23.9 million in the prior-year quarter Q2 2025 Net Loss | Metric | Q2 2025 | Q2 2024 | YoY Change | Source | | :----- | :------ | :------ | :--------- | :----- | | Net Loss | $7.4 million | $23.9 million | -69.1% | [18] | - The Q2 2024 net loss included a **non-cash impairment charge of $16.0 million**[14](index=14&type=chunk)[18](index=18&type=chunk) [Non-GAAP Financial Measures](index=2&type=section&id=2.5.%20Non-GAAP%20Financial%20Measures) The Non-GAAP EBITDA loss improved significantly, while the Adjusted Non-GAAP EBITDA loss remained relatively stable year-over-year Q2 2025 Non-GAAP EBITDA Loss | Metric | Q2 2025 | Q2 2024 | YoY Change | Source | | :----- | :------ | :------ | :--------- | :----- | | Non-GAAP EBITDA Loss | $5.8 million | $22.3 million (adjusted) | -74.0% | [18] | | Adjusted Non-GAAP EBITDA Loss | $5.5 million | $5.2 million | +5.8% | [19] | [Liquidity and Capital Structure](index=2&type=section&id=Liquidity%20and%20Capital%20Structure) [Cash and Securities](index=2&type=section&id=3.1.%20Cash%20and%20Securities) Zomedica maintained a strong liquidity position with $59.1 million in cash, cash equivalents, and available-for-sale securities Liquidity as of June 30, 2025 | Metric | Amount | | :----- | :----- | | Cash, Cash Equivalents, and Available-for-Sale Securities | $59.1 million | [Outstanding Share Capital](index=2&type=section&id=3.2.%20Outstanding%20Share%20Capital) As of June 30, 2025, the company had approximately 980 million common shares issued and outstanding Outstanding Common Shares as of June 30, 2025 | Metric | Amount | | :----- | :----- | | Common Shares Issued and Outstanding | 979,949,668 | [Company Profile and Additional Information](index=3&type=section&id=Company%20Profile%20and%20Additional%20Information) [About Zomedica](index=3&type=section&id=4.1.%20About%20Zomedica) Zomedica is a veterinary health company providing innovative solutions for animals, targeting a U.S. market exceeding $2 billion - Zomedica is a leading equine and companion animal healthcare company dedicated to improving animal health by providing veterinarians innovative therapeutic and diagnostic solutions[25](index=25&type=chunk) - Key products include **PulseVet®** shock wave system, **Assisi® Loop**, **TRUFORMA®** diagnostic platform, **TRUVIEW®** digital cytology system, **VETGuardian®** no-touch monitoring system, and **VETIGEL®** hemostatic gel[25](index=25&type=chunk) - The total addressable market in the U.S. for Zomedica's products **exceeds $2 billion**[25](index=25&type=chunk) - Strategic focus areas include advancing product offerings, leveraging strategic acquisitions, and expanding internationally[25](index=25&type=chunk) [Investor Relations & Communications](index=3&type=section&id=4.2.%20Investor%20Relations%20%26%20Communications) The company will host a webinar to discuss its Q2 financial performance and has provided contact details for investor inquiries - Zomedica will host its 'Fourth Friday at Four Webinar' on **Friday, August 22, 2025, at 4:00 PM ET**, to review and discuss its second-quarter financial performance[23](index=23&type=chunk) - Investor Relations contact: investors@zomedica.com, 1-734-369-2555[33](index=33&type=chunk) [Cautionary Note Regarding Forward-Looking Statements](index=3&type=section&id=4.3.%20Cautionary%20Note%20Regarding%20Forward-Looking%20Statements) This section disclaims that forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially - Forward-looking information is frequently characterized by words such as 'plan', 'expect', 'project', 'intend', 'believe', 'anticipate', 'estimate' and other similar words, or statements that certain events or conditions 'may' or 'will' occur[27](index=27&type=chunk) - Forward-looking information is based on the opinions and estimates of management at the date the statements are made, including assumptions with respect to economic growth, demand for products, and the company's ability to produce and sell its products[28](index=28&type=chunk) - Readers are cautioned not to place undue reliance on forward-looking information, as actual events or results could differ materially due to various risks and uncertainties[29](index=29&type=chunk)[31](index=31&type=chunk)[32](index=32&type=chunk) [Non-GAAP Measures Definitions and Reconciliations](index=4&type=section&id=4.4.%20Non-GAAP%20Measures%20Definitions%20and%20Reconciliations) This section defines Non-GAAP EBITDA and Adjusted Non-GAAP EBITDA and provides detailed reconciliations to their closest U.S. GAAP equivalents - Non-GAAP EBITDA and Adjusted Non-GAAP EBITDA are not recognized terms under U.S. GAAP and are used by management to evaluate operating performance and assist investors in evaluating Zomedica's on-going operations[34](index=34&type=chunk) - **Non-GAAP EBITDA** is defined as net loss and comprehensive loss excluding amortization, depreciation, non-cash stock compensation, and taxes while reversing out the benefits derived from net interest income[35](index=35&type=chunk) - **Adjusted Non-GAAP EBITDA** is defined as Non-GAAP EBITDA, excluding impairment charges and non-recurring items such as specialized accounting, tax, and audit services, new facility integration/start-up costs, and other one-time items[35](index=35&type=chunk) Reconciliation of Non-GAAP Financial Measures (Three Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | | :-------------------------------- | :------------------ | :------------------ | | Net loss and comprehensive loss | $(7,353) | $(23,980) | | Amortization expense | 1,412 | 1,626 | | Depreciation expense | 509 | 351 | | Stock-compensation expense | 260 | 858 | | Interest income | (629) | (1,038) | | Income tax benefit | 12 | (143) | | **Non-GAAP EBITDA loss** | **$(5,789)** | **$(22,326)** | | Impairment expense | - | 16,024 | | Proforma adjustments (1) | 279 | 1,083 | | **Adjusted Non-GAAP EBITDA loss** | **$(5,510)** | **$(5,219)** | (1) Proforma adjustments for the three months ended June 30, 2025 included $263 of one-time general and administrative expenses and $16 of one-time selling and marketing expenses. Reconciliation of Non-GAAP Financial Measures (Six Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | | :-------------------------------- | :------------------ | :------------------ | | Net loss and comprehensive loss | $(71,118) | $(33,203) | | Amortization expense | 3,105 | 3,223 | | Depreciation expense | 1,030 | 685 | | Stock-compensation expense | 878 | 1,959 | | Interest income | (1,359) | (2,131) | | Income tax benefit | (45) | (309) | | **Non-GAAP EBITDA loss** | **$(67,509)** | **$(29,776)** | | Impairment expense | 55,833 | 16,024 | | (1) Proforma adjustments | 422 | 3,276 | | **Adjusted Non-GAAP EBITDA loss** | **$(11,254)** | **$(10,476)** | (1) Proforma adjustments for the six months ended June 30, 2025 included $417 of one-time general and administrative expenses and $5 of one-time selling and marketing expenses.

Filing Information [Registrant Information](index=1&type=section&id=Registrant%20Information) This section provides key identification details for Zomedica Corp.'s Form 10-Q filing, including its address, telephone number, and status as a non-accelerated filer and smaller reporting company - **Registrant**: Zomedica Corp[1](index=1&type=chunk) - **Filing Type**: Quarterly Report (Form 10-Q) for the period ended June 30, 2025[1](index=1&type=chunk) Filer Status and Company Classification | Filer Status | Status | | :------------- | :----- | | Large accelerated filer | ☐ | | Accelerated filer | ☐ | | Non-accelerated filer | ☒ | | Smaller reporting company | ☒ | | Emerging growth company | ☐ | - **Common Shares Outstanding**: 979,949,668 as of August 6, 2025[3](index=3&type=chunk) PART I — FINANCIAL INFORMATION [Item 1. Condensed Consolidated Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20(Unaudited)) This section presents Zomedica Corp.'s unaudited condensed consolidated financial statements for the periods ended June 30, 2025, and December 31, 2024, including balance sheets, statements of operations and comprehensive loss, statements of shareholders' equity, and statements of cash flows, along with accompanying notes detailing significant accounting policies, estimates, and financial instrument disclosures [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets%20as%20of%20June%2030%2C%202025%20and%20December%2031%2C%202024) Presents Zomedica's financial position, detailing assets, liabilities, and equity as of June 30, 2025, and December 31, 2024 Consolidated Balance Sheet Highlights (in Thousands) | Metric (in Thousands) | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Total Assets | $136,472 | $207,360 | | Total Liabilities | $11,115 | $11,696 | | Total Shareholders' Equity | $125,357 | $195,664 | | Goodwill | $— | $45,556 | | Intangible assets, net | $41,395 | $52,538 | - **Total assets decreased by $70,888 thousand (34.2%)** from December 31, 2024, to June 30, 2025, primarily due to the full impairment of goodwill and a reduction in available-for-sale securities[7](index=7&type=chunk) - **Total shareholders' equity decreased by $70,307 thousand (35.9%)** over the six-month period, largely driven by the accumulated deficit increasing from **$(217,915) thousand to $(289,122) thousand**[7](index=7&type=chunk) [Consolidated Statements of Operations and Comprehensive Loss](index=4&type=section&id=Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss%20for%20the%20Three%20and%20Six%20Months%20Ended%20June%2030%2C%202025%20and%202024) Summarizes Zomedica's financial performance, including revenue, expenses, and net loss, for the three and six months ended June 30, 2025 and 2024 Consolidated Statements of Operations (in Thousands, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net revenue | $6,964 | $6,131 | $13,464 | $12,393 | | Cost of revenue | $2,298 | $1,769 | $4,391 | $3,914 | | Gross profit | $4,666 | $4,362 | $9,073 | $8,479 | | General and administrative | $6,162 | $7,976 | $12,424 | $16,601 | | Research and development | $1,886 | $1,506 | $3,739 | $3,277 | | Selling and marketing | $4,653 | $3,923 | $9,660 | $8,030 | | Impairment expense | $— | $16,024 | $55,833 | $16,024 | | Loss from operations | $(8,035) | $(25,067) | $(72,583) | $(35,453) | | Net loss | $(7,398) | $(23,931) | $(71,207) | $(33,091) | | Loss per share - basic and diluted | $(0.01) | $(0.02) | $(0.07) | $(0.03) | - **Net revenue increased by 14%** for the three months and **9%** for the six months ended June 30, 2025, driven by growth in TRUFORMA® products, Assisi® products, PulseVet® consumables, and new VETIGEL® sales[8](index=8&type=chunk)[150](index=150&type=chunk)[151](index=151&type=chunk) - **Net loss significantly decreased by 69%** for the three months ended June 30, 2025, but **increased by 115%** for the six months ended June 30, 2025, primarily due to a substantial impairment expense of **$55,833 thousand** recognized in the first quarter of 2025[8](index=8&type=chunk)[163](index=163&type=chunk)[164](index=164&type=chunk) [Consolidated Statements of Shareholders' Equity](index=5&type=section&id=Consolidated%20Statements%20of%20Shareholders'%20Equity%20for%20the%20Three%20and%20Six%20Months%20Ended%20June%2030%2C%202025%20and%202024) Details changes in Zomedica's shareholders' equity, including common stock, additional paid-in capital, accumulated deficit, and comprehensive income, for the periods ended June 30, 2025 and 2024 Shareholders' Equity Changes (in Thousands) | Metric | Balance at Dec 31, 2024 | Stock-based compensation | Net loss | Other comprehensive income | Balance at June 30, 2025 | | :-------------------- | :---------------------- | :----------------------- | :------- | :------------------------- | :----------------------- | | Common Stock Amount | $380,973 | — | — | — | $380,973 | | Additional Paid-In Capital | $32,518 | $811 | — | — | $33,329 | | Accumulated Deficit | $(217,915) | — | $(71,207) | — | $(289,122) | | Accumulated Comprehensive Income | $88 | — | — | $89 | $177 | | Total Shareholders' Equity | $195,664 | $811 | $(71,207) | $89 | $125,357 | - **Total shareholders' equity decreased by $70,307 thousand** from December 31, 2024, to June 30, 2025, primarily due to a **net loss of $71,207 thousand**[10](index=10&type=chunk) - **Stock-based compensation added $811 thousand** to additional paid-in capital for the six months ended June 30, 2025[10](index=10&type=chunk) [Consolidated Statements of Cash Flows](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows%20for%20the%20Six%20Months%20Ended%20June%2030%2C%202025%20and%202024) Outlines Zomedica's cash inflows and outflows from operating, investing, and financing activities for the six months ended June 30, 2025 and 2024 Consolidated Cash Flows (in Thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------- | :----------------------------- | :----------------------------- | | Operating Activities | $(12,090) | $(14,309) | | Investing Activities | $13,085 | $9,397 | | Financing Activities | $— | $— | | Net Increase (Decrease) in Cash | $995 | $(4,912) | | Cash and Cash Equivalents, End of Period | $8,129 | $7,939 | - **Net cash used in operating activities decreased by $2,219 thousand (16%)** for the six months ended June 30, 2025, primarily due to lower operating expenses, excluding non-cash charges[12](index=12&type=chunk)[166](index=166&type=chunk) - **Net cash provided by investing activities increased by $3,688 thousand (39%)** due to decreased capital expenditures and reduced investment in nonconsolidated entities compared to the prior period[12](index=12&type=chunk)[167](index=167&type=chunk) [Notes to the Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) These notes provide detailed disclosures on Zomedica's accounting policies, financial instrument valuations, segment performance, and significant events, offering context to the condensed consolidated financial statements [1. Nature of Operations](index=8&type=section&id=1.%20Nature%20of%20Operations) Describes Zomedica Corp.'s core business as a veterinary health company focused on companion animal products - Zomedica Corp. is a veterinary health company focused on creating products for companion animals by addressing unmet needs of clinical veterinarians[13](index=13&type=chunk) [2. Basis of Preparation](index=8&type=section&id=2.%20Basis%20of%20Preparation) Outlines the accounting principles and rules followed in preparing the condensed consolidated financial statements - The condensed consolidated financial statements are prepared in conformity with U.S. GAAP and SEC rules for interim reports, including all normal recurring adjustments[15](index=15&type=chunk) [3. Significant Accounting Policies](index=8&type=section&id=3.%20Significant%20Accounting%20Policies) Details the key accounting principles and methods applied by Zomedica, including functional currency, segment reporting, and revenue recognition - The Company's functional currency for Canada, U.S., and Switzerland subsidiaries is U.S. dollars, while its Japanese subsidiary uses Japanese Yen, with translation gains/losses recorded in other comprehensive income/loss[18](index=18&type=chunk) - The Company adopted ASU No. 2023-07, Segment Reporting, in Q4 2024, which did not materially impact financial statements[23](index=23&type=chunk) - Revenue from product sales (instruments, consumables) is recognized at a point in time upon transfer of control, while extended warranties and lease components are recognized over time[38](index=38&type=chunk)[39](index=39&type=chunk) [4. Critical Accounting Judgments and Key Sources of Estimation Uncertainty](index=18&type=section&id=4.%20Critical%20Accounting%20Judgments%20and%20Key%20Sources%20of%20Estimation%20Uncertainty) Highlights areas requiring significant management judgment and estimation, such as impairment testing, asset valuation, and revenue recognition - Critical accounting areas include impairment testing of goodwill and long-lived assets, valuation and payback of property and equipment (TRUFORMA® capital), and revenue recognition for variable consideration (PulseVet® trode returns)[58](index=58&type=chunk)[63](index=63&type=chunk)[64](index=64&type=chunk) - Goodwill impairment testing involves qualitative and quantitative analyses, using discounted cash flow and market-based methods with significant assumptions about financial projections, growth rates, and discount rates[58](index=58&type=chunk)[59](index=59&type=chunk) - The valuation of TRUFORMA® diagnostic instruments relies on estimated future revenue over a ten-year life, with a **25% reduction in estimated annual placements increasing the payback period from 4.39 years to 5.85 years** as of June 30, 2025[63](index=63&type=chunk)[145](index=145&type=chunk) [5. Investment Securities](index=20&type=section&id=5.%20Investment%20Securities) Provides details on Zomedica's investment securities, including fair value and changes over the reporting period Investment Securities Fair Value (in Thousands) | Type of Security | June 30, 2025 (Fair Value) | December 31, 2024 (Fair Value) | | :--------------- | :------------------------- | :----------------------------- | | Commercial paper | $1,988 | $10,387 | | Corporate notes / bonds | $35,558 | $45,826 | | U.S. treasuries | $9,262 | $6,649 | | U.S. govt. agencies | $4,131 | $1,470 | | Money market funds | $5,322 | $2,766 | | **Total** | **$56,261** | **$67,098** | - **Total investment securities decreased by $10,837 thousand** from December 31, 2024, to June 30, 2025[65](index=65&type=chunk) - The decline in fair value of debt securities is largely attributed to the rising interest rate environment, but no credit or non-credit impairment charges were recorded as debtors continue timely payments[75](index=75&type=chunk) [6. Fair Value Measurements](index=22&type=section&id=6.%20Fair%20Value%20Measurements) Explains the methodologies and hierarchy used to measure the fair value of Zomedica's financial instruments Fair Value Hierarchy of Investments (in Thousands) as of June 30, 2025 | Type of Security | Level 1 | Level 2 | Level 3 | Estimated Fair Value | | :--------------- | :------ | :------ | :------ | :------------------- | | Commercial paper | $— | $1,988 | $— | $1,988 | | Corporate notes / bonds | $— | $35,558 | $— | $35,558 | | U.S. treasuries | $9,262 | $— | $— | $9,262 | | U.S. govt. agencies | $4,131 | $— | $— | $4,131 | | Money market funds | $5,322 | $— | $— | $5,322 | | **Total** | **$18,715** | **$37,546** | **$—** | **$56,261** | - The Company measures cash and cash equivalents, investments, and Stock Appreciation Rights (SARs) liability at fair value on a recurring basis, classifying them within a three-tier hierarchy[69](index=69&type=chunk)[71](index=71&type=chunk)[72](index=72&type=chunk)[73](index=73&type=chunk) - SARs liability is classified as **Level 2** and measured using a Black-Scholes option-pricing model, with changes in fair value recognized as compensation expense[73](index=73&type=chunk) [7. Inventory](index=24&type=section&id=7.%20Inventory) Details the composition and changes in Zomedica's inventory, including raw materials, finished goods, and reserves Inventory Breakdown (in Thousands) | Inventory Type | June 30, 2025 | December 31, 2024 | | :------------- | :------------ | :---------------- | | Raw materials | $4,448 | $4,301 | | Finished goods | $757 | $539 | | Purchased inventory | $484 | $244 | | Less: reserves | $(17) | $(26) | | **Inventory, net** | **$5,672** | **$5,058** | - **Total net inventory increased by $614 thousand (12.1%)** from December 31, 2024, to June 30, 2025, primarily driven by increases in finished goods and purchased inventory[76](index=76&type=chunk) [8. Prepaid Expenses and Deposits](index=24&type=section&id=8.%20Prepaid%20Expenses%20and%20Deposits) Presents the breakdown and changes in Zomedica's prepaid expenses and deposits over the reporting period Prepaid Expenses and Deposits (in Thousands) | Category | June 30, 2025 | December 31, 2024 | | :------- | :------------ | :---------------- | | Deposits | $236 | $508 | | Prepaid marketing | $453 | $368 | | Prepaid insurance | $262 | $438 | | Other | $1,161 | $1,170 | | **Total** | **$2,112** | **$2,484** | - **Total prepaid expenses and deposits decreased by $372 thousand (15%)** from December 31, 2024, to June 30, 2025, mainly due to a reduction in deposits and prepaid insurance[77](index=77&type=chunk) [9. Accrued Expenses and Other Current Liabilities](index=24&type=section&id=9.%20Accrued%20Expenses%20and%20Other%20Current%20Liabilities) Details the composition and changes in Zomedica's accrued expenses and other current liabilities Accrued Expenses and Other Current Liabilities (in Thousands) | Category | June 30, 2025 | December 31, 2024 | | :------- | :------------ | :---------------- | | Accrued employee compensation and benefits | $3,344 | $4,557 | | Accrued taxes | $854 | $1,003 | | Accrued professional services | $484 | $535 | | Other | $246 | $336 | | **Total** | **$4,928** | **$6,431** | - **Total accrued expenses and other current liabilities decreased by $1,503 thousand (23.4%)** from December 31, 2024, to June 30, 2025, primarily due to lower accrued employee compensation and benefits[78](index=78&type=chunk) [10. Property and Equipment](index=24&type=section&id=10.%20Property%20and%20Equipment) Provides a breakdown of Zomedica's property and equipment, net of accumulated depreciation, and details any impairment charges Property and Equipment, Net (in Thousands) | Category | June 30, 2025 | December 31, 2024 | | :------- | :------------ | :---------------- | | Total property and equipment | $25,942 | $28,005 | | Less: accumulated depreciation | $(4,087) | $(3,416) | | **Property and equipment, net** | **$21,855** | **$24,589** | - **Net property and equipment decreased by $2,734 thousand (11.1%)** from December 31, 2024, to June 30, 2025[79](index=79&type=chunk) - A **$2.0 million impairment charge** was recognized in Q1 2025 for certain Diagnostics segment assets, including **$0.9 million** for machinery and equipment and **$1.1 million** for construction in progress, following a significant decline in market capitalization[79](index=79&type=chunk)[80](index=80&type=chunk) [11. Goodwill and Intangible Assets](index=26&type=section&id=11.%20Goodwill%20and%20Intangible%20Assets) Details Zomedica's goodwill and intangible assets, including impairment charges and amortization, for the reporting periods Goodwill Carrying Amount (in Thousands) | Segment | December 31, 2024 | Impairment | June 30, 2025 | | :-------- | :---------------- | :--------- | :------------ | | Diagnostics | $— | $— | $— | | Therapeutic Devices | $45,556 | $(45,556) | $— | | **Total** | **$45,556** | **$(45,556)** | **$—** | - A **$45.6 million non-cash goodwill impairment charge** was recognized in Q1 2025, fully impairing goodwill in the PulseVet and Assisi reporting units within the Therapeutic Devices segment, resulting in no remaining goodwill[81](index=81&type=chunk) - An **$8.3 million non-cash impairment charge** was also recognized for amortizable intangible assets in the Diagnostics segment, primarily technology assets (**$7.1 million**) and customer relationships (**$0.8 million**), due to the same triggering event[82](index=82&type=chunk) Intangible Assets, Net (in Thousands) | Category | June 30, 2025 | December 31, 2024 | | :------- | :------------ | :---------------- | | Total intangibles | $61,088 | $69,126 | | Less: accumulated amortization | $(19,693) | $(16,588) | | **Intangibles, net** | **$41,395** | **$52,538** | [12. Stock-Based Compensation](index=27&type=section&id=12.%20Stock-Based%20Compensation) Outlines Zomedica's stock-based compensation expense, including details on stock options and Stock Appreciation Rights (SARs) Stock-Based Compensation Expense (in Thousands) | Period | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Expense | $266 | $859 | $811 | $1,960 | - The Company issued **16,050,000 stock options** in the six months ended June 30, 2025, compared to **3,925,000** in the same period of 2024, with options vesting over four years and expiring in 10 years[88](index=88&type=chunk) - Cash-settled Stock Appreciation Rights (SARs) are accounted for as liability-classified awards, with a **carrying amount of $186 thousand** as of June 30, 2025, and changes in fair value recognized as compensation expense[90](index=90&type=chunk)[94](index=94&type=chunk) [13. Income Taxes](index=30&type=section&id=13.%20Income%20Taxes) Discusses Zomedica's income tax position, including deferred tax liabilities and valuation allowances against net operating loss carryforwards - The Company has an overall domestic net deferred tax liability position and maintains a **valuation allowance of $24,633 thousand** against US federal and state net operating loss carryforwards due to uncertainty of realization[95](index=95&type=chunk) - A full valuation allowance remains necessary to offset Canadian deferred tax assets due to historical losses[95](index=95&type=chunk) [14. Commitments and Contingencies](index=30&type=section&id=14.%20Commitments%20and%20Contingencies) Details Zomedica's contractual commitments, including agreements with Brisby Inc. and Cresilon, Inc., and confirms the absence of material litigation - The Company is not aware of any pending or threatened material litigation claims as of June 30, 2025[96](index=96&type=chunk) - Under an agreement with Brisby Inc., Zomedica has made **$1,563 thousand in cash payments** and holds a **19.50% equity stake**, with remaining payments due upon future development milestones and commercial sales of Smart Pet Pad and Intelligent Pet Bed[98](index=98&type=chunk)[99](index=99&type=chunk)[100](index=100&type=chunk) - A License and Supply Agreement with Cresilon, Inc. grants Zomedica exclusive rights to promote and sell VETIGEL® Products in the U.S. and Japan, involving an upfront license fee, sales milestone payments up to **$4,000 thousand**, and royalties[102](index=102&type=chunk)[103](index=103&type=chunk)[104](index=104&type=chunk) [15. Segment Information](index=32&type=section&id=15.%20Segment%20Information) Provides financial data for Zomedica's two reportable segments: Diagnostics and Therapeutic Devices, including net revenue and gross profit - Zomedica operates in two reportable segments: Diagnostics (TRUFORMA®, VetGuardian®, TRUVIEW®) and Therapeutic Devices (Assisi®, PulseVet®, VETIGEL®)[104](index=104&type=chunk) Segment Net Revenue (in Thousands) | Segment | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :---------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Diagnostics | $781 | $419 | $1,340 | $1,163 | | Therapeutic Devices | $6,183 | $5,712 | $12,124 | $11,230 | | **Consolidated** | **$6,964** | **$6,131** | **$13,464** | **$12,393** | Segment Gross Profit (in Thousands) | Segment | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :---------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Diagnostics | $192 | $(43) | $194 | $118 | | Therapeutic Devices | $4,474 | $4,405 | $8,879 | $8,361 | | **Consolidated** | **$4,666** | **$4,362** | **$9,073** | **$8,479** | [16. Loss Per Share](index=34&type=section&id=16.%20Loss%20Per%20Share) Presents Zomedica's basic and diluted loss per share calculations for the reporting periods Loss Per Share (Basic and Diluted) | Period | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net loss | $(7,398) | $(23,931) | $(71,207) | $(33,091) | | Weighted-average shares | 979,949,668 | 979,949,668 | 979,949,668 | 979,949,668 | | **Loss per share** | **$(0.01)** | **$(0.02)** | **$(0.07)** | **$(0.03)** | - Stock options and warrants were excluded from diluted loss per share computation as their effect would be anti-dilutive[108](index=108&type=chunk) [17. Subsequent Events](index=35&type=section&id=17.%20Subsequent%20Events) Reports significant events occurring after the balance sheet date, including recent tax reform legislation - On July 4, 2025, the U.S. enacted tax reform legislation (One Big Beautiful Bill Act) which is anticipated to have an immaterial impact in the period of enactment, with the Company continuing to evaluate its full effect[109](index=109&type=chunk)[175](index=175&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=36&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on Zomedica's financial condition and operational results for the quarter ended June 30, 2025, discussing revenue drivers, expense trends, and liquidity, alongside forward-looking statements and critical accounting policies [Cautionary Note Regarding Forward-Looking Statements](index=36&type=section&id=CAUTIONARY%20NOTE%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) Warns readers about the inherent risks and uncertainties associated with forward-looking statements in the report - The report contains forward-looking statements subject to numerous risks and uncertainties, including macroeconomic conditions, geopolitical tensions, supply chain disruptions, and the ability to commercialize products and integrate acquisitions[111](index=111&type=chunk)[112](index=112&type=chunk) - Zomedica cautions that actual results may differ significantly from expectations and undertakes no duty to update these statements except as required by law[112](index=112&type=chunk)[113](index=113&type=chunk) [Components of Revenue and Costs and Expenses](index=36&type=section&id=Components%20of%20Revenue%20and%20Costs%20and%20Expenses) Explains the various sources of Zomedica's revenue and the primary components of its cost of revenue and operating expenses - Revenue sources include consumables and capital sales from Assisi®, PulseVet®, TRUFORMA®, TRUVIEW®, VetGuardian®, and VETIGEL® products in the U.S. and internationally[114](index=114&type=chunk) - Cost of revenue primarily consists of raw materials, labor, shipping, and overhead for product assembly, including purchased VETIGEL® consumables[115](index=115&type=chunk) - Operating expenses are categorized into general and administrative (salaries, public company costs), research and development (new assay development, product enhancements), and selling and marketing (personnel, promotional activities)[117](index=117&type=chunk)[118](index=118&type=chunk)[119](index=119&type=chunk)[120](index=120&type=chunk) [Critical Accounting Policies and Significant Judgments and Estimates](index=40&type=section&id=Critical%20Accounting%20Policies%20and%20Significant%20Judgments%20and%20Estimates) Identifies Zomedica's critical accounting policies and areas requiring significant management judgment and estimation, particularly regarding asset impairment - Critical accounting policies include Intangible Assets and Business Combinations, Impairment Testing, Valuation and Payback of Property and Equipment, and Revenue Recognition and Liabilities Due to Customers[132](index=132&type=chunk) - In Q1 2025, a triggering event (significant decline in market capitalization post-NYSE American delisting) led to a quantitative goodwill impairment analysis, resulting in a **$45,555 thousand non-cash charge** for PulseVet and Assisi reporting units[138](index=138&type=chunk) - The same triggering event also led to **$8,297 thousand in non-cash impairment charges** for amortizable intangible assets and **$1.981 million** for property and equipment in Q1 2025[139](index=139&type=chunk)[140](index=140&type=chunk) [Results of Consolidated Operations](index=44&type=section&id=Results%20of%20Consolidated%20Operations) Analyzes Zomedica's consolidated financial performance, including revenue, gross profit, operating expenses, and net loss trends for the reporting periods Consolidated Revenue and Gross Profit Trends (in Thousands) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | Change (%) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | Change (%) | | :---------------- | :--------------------------- | :--------------------------- | :--------- | :--------------------------- | :--------------------------- | :--------- | | Net Revenue | $6,964 | $6,131 | 14% | $13,464 | $12,393 | 9% | | Cost of Revenue | $2,298 | $1,769 | 30% | $4,391 | $3,914 | 12% | | Gross Profit | $4,666 | $4,362 | 7% | $9,073 | $8,479 | 7% | | Gross Profit Margin | 67% | 71% | -4 pp | 67% | 68% | -1 pp | - The decrease in gross profit margin for both periods was primarily due to higher depreciation expenses from capital projects completed in H2 2024 and changes in product mix, partially offset by manufacturing efficiencies and increased unit sales[155](index=155&type=chunk) Operating Expenses and Net Loss Trends (in Thousands) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | Change (%) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | Change (%) | | :-------------------------- | :--------------------------- | :--------------------------- | :--------- | :--------------------------- | :--------------------------- | :--------- | | General and Administrative | $6,162 | $7,976 | -23% | $12,424 | $16,601 | -25% | | Research and Development | $1,886 | $1,506 | 25% | $3,739 | $3,277 | 14% | | Selling and Marketing | $4,653 | $3,923 | 19% | $9,660 | $8,030 | 20% | | Impairment Expense | $— | $16,024 | -100% | $55,833 | $16,024 | 248% | | Net Loss | $(7,398) | $(23,931) | -69% | $(71,207) | $(33,091) | 115% | [Cash Flows](index=47&type=section&id=Cash%20Flows) Examines Zomedica's cash flow activities, highlighting changes in operating and investing cash flows for the six months ended June 30, 2025 and 2024 Cash Flow Summary (in Thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Change ($) | Change (%) | | :----------------- | :----------------------------- | :----------------------------- | :--------- | :--------- | | Operating Activities | $(12,090) | $(14,309) | $2,219 | -16% | | Investing Activities | $13,085 | $9,397 | $3,688 | 39% | | Net Increase (Decrease) in Cash | $995 | $(4,912) | $5,907 | 120% | | Cash and Cash Equivalents, End of Period | $8,129 | $7,939 | $190 | 2% | - The decrease in cash used in operating activities was primarily due to lower operating expenses, excluding non-cash charges like stock-based compensation and impairment expense[166](index=166&type=chunk) - The increase in cash provided by investing activities resulted from decreased capital expenditures (e.g., warehouse expansion) and reduced investment in nonconsolidated entities[167](index=167&type=chunk) [Liquidity, Capital Resources, and Financial Condition](index=47&type=section&id=Liquidity%2C%20Capital%20Resources%2C%20and%20Financial%20Condition) Assesses Zomedica's financial health, including working capital, accumulated deficit, and management's outlook on funding future operations - As of June 30, 2025, the Company had an **accumulated deficit of $289,122 thousand** and **working capital of $60,476 thousand**[168](index=168&type=chunk)[169](index=169&type=chunk) - Management believes existing cash is sufficient to fund both short-term (next 12 months) and long-term (beyond 12 months) operational requirements, including fixed obligations, clinical studies, and potential business development[170](index=170&type=chunk)[171](index=171&type=chunk)[172](index=172&type=chunk) - Future capital requirements depend on factors such as development and commercialization costs, manufacturing, marketing, personnel, public company expenses, and potential M&A activities[173](index=173&type=chunk)[176](index=176&type=chunk) [Climate Change](index=51&type=section&id=Climate%20Change) Discusses the potential impacts of climate change, including regulatory changes and operational risks, on Zomedica's business - Increased public awareness of climate change may lead to more regulations, increased energy efficiency demands, and a shift to more expensive sustainable energy sources[177](index=177&type=chunk) - The potential impacts of climate change on operations, including changes in rainfall, water shortages, storm patterns, and temperature levels, remain uncertain and could increase operating costs or affect insurance availability[178](index=178&type=chunk)[179](index=179&type=chunk) [Item 4. Controls and Procedures](index=51&type=section&id=Item%204.%20Controls%20and%20Procedures) This section confirms the effectiveness of Zomedica's disclosure controls and procedures as of June 30, 2025, and reports no material changes in internal control over financial reporting during the quarter - Management, including the principal executive officer and principal financial and accounting officer, concluded that disclosure controls and procedures were effective as of June 30, 2025[180](index=180&type=chunk)[181](index=181&type=chunk) - There were no changes in internal control over financial reporting during the three months ended June 30, 2025, that materially affected or are reasonably likely to materially affect internal control over financial reporting[182](index=182&type=chunk) PART II — OTHER INFORMATION [Item 1. Legal Proceedings](index=51&type=section&id=Item%201.%20Legal%20Proceedings) Zomedica Corp. is not aware of any pending or threatened material litigation claims as of June 30, 2025, or August 6, 2025 - The Company is not aware of any pending or threatened material litigation claims against it as of June 30, 2025, and continuing as of August 6, 2025[96](index=96&type=chunk)[183](index=183&type=chunk) [Item 1A. Risk Factors](index=51&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the Company's Annual Report on Form 10-K for the year ended December 31, 2024 - No material changes in risk factors from those previously disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024[183](index=183&type=chunk) [Item 6. Exhibits](index=52&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed as part of, or incorporated by reference into, the Quarterly Report, including certifications, XBRL documents, and a separation agreement - Exhibits include a Separation Agreement (10.1), CEO and VP of Finance certifications (31.1, 31.2, 32.1), and Inline XBRL documents (101.INS, 101.SCH, 101.CAL, 101.DEF, 101.LAB, 101.PRE, 104)[186](index=186&type=chunk) [Signatures](index=53&type=section&id=SIGNATURES) This section contains the official signatures of Zomedica Corp.'s Chief Executive Officer and Vice President of Finance and Corporate Controller, certifying the filing of the report - The report is signed by Larry Heaton, Chief Executive Officer, and Michael Zuehlke, Vice President of Finance and Corporate Controller, on August 6, 2025[189](index=189&type=chunk)[190](index=190&type=chunk)

Company Overview - Zomedica Corp. is a veterinary health company focused on point-of-care diagnostic and therapeutic products for equine and companion animals [3] - The company offers a range of innovative solutions including the PulseVet® shock wave system, Assisi® Loop therapeutic devices, TRUFORMA® diagnostic platform, TRUVIEW® digital cytology system, VETGuardian® monitoring system, and VETIGEL® hemostatic gel [3] - Zomedica's total addressable market in the U.S. exceeds $2 billion [3] - The company is headquartered in Michigan and employs approximately 150 people, with manufacturing and distribution facilities in Georgia and Minnesota [3] Financial Performance - Zomedica reported an 8% revenue growth in 2024, reaching $27 million [3] - As of March 31, 2025, the company maintains a strong balance sheet with approximately $65 million in liquidity [3] Strategic Initiatives - Zomedica is advancing its product offerings through strategic acquisitions and international expansion [3] - The company aims to enhance the quality of care for pets, increase pet parent satisfaction, and improve the workflow, cash flow, and profitability of veterinary practices [3] Upcoming Events - Larry Heaton, CEO of Zomedica, will present at the OTCQB Venture Virtual Investor Conference on August 7, 2025, at 1:30 PM ET [1] - The event will allow real-time interaction with investors, and an archived webcast will be available post-event [1]

Company Mission and Market Opportunity - Zomedica aims to bring innovative technology to veterinarians, improving pet care, pet parent satisfaction, and practice profitability[10] - The company estimates a $2.5 billion total annual recurring revenue addressable market, focusing on therapeutic devices and diagnostics[15] - The U S total annual serviceable market is $2.5 Billion, with recurring annual revenue ranging from $650 to $24,000 and per unit capital revenue ranging from $4,500 to $30,000[22] Financial Performance and Growth - Zomedica experienced significant revenue growth, with therapeutic devices growing by approximately 28% and diagnostics growing by approximately 252% in FY23[17, 18] - The company's gross margins are approximately 69%[19] - Total revenue increased from $4.1 million in 2021 to $25.2 million in 2023, a 33% increase from 2022 to 2023[31, 120] Product Portfolio and Innovation - The company's product portfolio includes PulseVet for shock wave therapy, Assisi devices for targeted PEMF therapy, TRUVIEW for digital cytology, TRUFORMA for point-of-care diagnostics, and VetGuardian for pet monitoring[25, 42, 49, 56, 73] - Zomedica plans to launch four to six new assays in 2024, expanding its point-of-care diagnostic solutions[69] Operational Efficiency and Commercial Strategy - Zomedica is focused on achieving operational efficiencies through its two U S manufacturing facilities and integration of Qorvo Biotechnologies' R&D and manufacturing[89, 93] - The company employs a multi-channel sales strategy, including an internal sales force, U S and international distributors, and eCommerce[98] Financial Strength - Zomedica had $90.9 million in liquidity as of March 31, 2024[32]

Company Performance - Zomedica Corp. reported a quarterly loss of $0.02 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.01, marking an earnings surprise of -100% [1] - The company posted revenues of $6.5 million for the quarter ended March 2025, missing the Zacks Consensus Estimate by 16.45%, compared to revenues of $6.26 million a year ago [2] - Zomedica has not surpassed consensus EPS estimates over the last four quarters [2] Stock Movement and Outlook - Zomedica shares have declined approximately 51.6% since the beginning of the year, while the S&P 500 has gained 0.2% [3] - The company's earnings outlook, including current consensus earnings expectations for upcoming quarters, will be crucial for stock performance [4] - The current consensus EPS estimate for the coming quarter is -$0.01 on revenues of $8.49 million, and -$0.03 on revenues of $35.16 million for the current fiscal year [7] Industry Context - The Medical - Instruments industry, to which Zomedica belongs, is currently in the top 34% of over 250 Zacks industries, indicating a favorable industry outlook [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Zomedica's stock performance [5]

Financial Data and Key Metrics Changes - Zometica reported total revenue of $6.5 million for Q1 2025, reflecting a 4% increase year-over-year, marking the seventeenth consecutive quarter of record revenue growth [5][14] - Gross margin improved to 68%, up from 66% in Q1 2024 [15] - The net loss for the quarter was $63.8 million, significantly higher than the net loss of $9.2 million in the prior year, primarily due to a $55.8 million non-cash impairment expense [16][17] Business Line Data and Key Metrics Changes - Revenue from the Therapeutic Devices segment was $5.9 million, while the Diagnostics segment generated approximately $600,000, a decrease of 25% [15] - Consumables revenue reached $4.5 million, a 13% increase year-over-year, representing about 70% of total revenue [14][15] - The TruForma platform saw a 41% year-over-year growth, driven by the launch of new assays [8] Market Data and Key Metrics Changes - International revenue grew approximately 32% year-over-year, indicating strong performance in new international markets [8] - The equine market expansion is a key focus, with new product launches aimed at increasing adoption and utilization [6][19] Company Strategy and Development Direction - The company aims to achieve cash flow breakeven and GAAP profitability through operational efficiencies and cost reductions [11][20] - Key growth strategies include expanding into the equine market, international market growth, and enhancing the TruForma platform with new assays [19][20] - Zometica is also focusing on optimizing its infrastructure to support growth and reduce costs [11][21] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growth potential in 2025, particularly in the equine market and international expansion [18][19] - The company is committed to reducing cash operating expenses and improving overall cost structure [12][21] - Management highlighted the importance of achieving cash flow profitability to support stock price appreciation [50][51] Other Important Information - The company relocated its headquarters to a smaller facility, which is expected to reduce overhead costs by over $200,000 annually [11] - Zometica has no debt and ended the quarter with $64.6 million in cash and cash equivalents [17][24] Q&A Session All Questions and Answers Question: Why have management options not been repriced or new options issued, instead of salary? - Management believes it is inappropriate to change the strike price of options and continues to issue option grants to employees [27] Question: Why are marketing costs much higher than the industry averages? - Marketing costs are high due to the nature of introducing new products to the market, which requires significant investment [28][30] Question: Are you looking to expand into retail vet stores? - Currently, the company sells one product line through online channels and has limited presence in brick-and-mortar stores [31] Question: Is there a strategy for getting institutional coverage, investment banking relations, and so on? - Institutional coverage is challenging due to the stock price being below a dollar, and the company is not prioritizing this at the moment [35] Question: Are you using or planning on using AI to expand the number and rate of discovery of new assays for TruForma? - The company is not currently using AI for this purpose but has a good cadence of assays under consideration for development [39] Question: How profitable has the new Vetigel product been? - The Vetigel product has favorable margins, and the company is focused on acquiring consumable product lines that can leverage the existing client base [41][42] Question: Why are you focusing so heavily on equine when it's only 5% the size of the domestic animal market? - The equine market has high penetration and demand for the company's products, justifying the focus [43] Question: What is the status of TruView? - The TruView platform is nearing completion for AI reporting and is expected to launch soon [45] Question: Do you plan on hiring a new CFO to replace Scott? - The current Vice President of Finance is doing a good job, and hiring a new CFO is not a priority at this time [46] Question: Are there any plans in place to try and increase the stock share price? - The company is focusing on internal growth and operational improvements to drive stock price appreciation [48][50] Question: What is the status of the cancer assay? - The cancer assay concept has been abandoned as it was determined not to be viable [58] Question: Have the tariffs affected the international expansion at all? - Tariffs have had a minor impact, but the company expects to continue expanding its international market presence [60][62]

Financial Data and Key Metrics Changes - Total revenue for the first quarter was a record $6,500,000, reflecting a 4% increase year-over-year, primarily driven by the growth in the Therapeutic Devices segment [5][13] - Gross margin was 68%, slightly up from 66% in the first quarter of the previous year [14] - Net loss for the quarter was $63,800,000, compared to a net loss of $9,200,000 in the prior year, largely due to a $55,800,000 non-cash impairment expense [15][16] - Cash used in the first quarter was approximately $6,800,000, with the company ending the quarter with $64,600,000 in cash and equivalents [16][17] Business Line Data and Key Metrics Changes - Revenue from the Therapeutic Devices segment was $5,900,000, while the Diagnostics segment generated approximately $600,000, a decrease of 25% [14] - Consumables revenue was $4,500,000, an increase of approximately 13% year-over-year, representing about 70% of total revenue [13][14] - The TruForma platform saw a 41% year-over-year growth during the quarter, driven by the demand for new assays [8] Market Data and Key Metrics Changes - International revenue grew approximately 32% year-over-year, indicating strong performance in new international markets [8] - The equine market is a focus area, with significant penetration and adoption of the PulseVet platform among equine veterinarians [6][43] Company Strategy and Development Direction - The company aims to achieve cash flow breakeven and GAAP profitability by focusing on operational efficiencies and reducing cash operating expenses [11][19] - Key growth strategies include expanding into the equine market, international market growth, and launching new assays and platforms [17][18] - The company is also exploring partnerships and acquisitions to enhance its product offerings and market reach [23][42] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growth potential in 2025, particularly in the equine market and international expansion [17][19] - The company is focused on reducing operating expenses and improving efficiency to support its path to profitability [12][20] - Management acknowledged the challenges posed by the current market conditions but remains committed to executing its growth strategy [19][60] Other Important Information - The company has relocated its headquarters to a smaller facility, which is expected to reduce overhead costs by over $200,000 annually [11] - A distribution agreement for the Vetigel product line was announced, with expectations for increased revenue contribution throughout 2025 [10][19] Q&A Session Summary Question: Why have management options not been repriced or new options issued? - Management believes it is inappropriate to change the strike price of options and continues to issue option grants to employees [26] Question: Why are marketing costs much higher than industry averages? - Marketing costs are high due to the nature of the company's products being new to the market, requiring significant investment in marketing and sales [27][30] Question: Are there plans to expand into retail vet stores? - Currently, the company sells one product line through online channels and has decided not to pursue retail due to high advertising costs [31] Question: Is there a strategy for getting institutional coverage? - Institutional coverage is challenging due to the stock price being below a dollar, and the company is focusing on operational improvements instead [35] Question: What is the status of TrueView? - The TrueView system is nearing completion, with a full launch expected soon, and it will operate on a subscription and per-use basis [45] Question: How profitable has the new Vetagel product been? - The Vetagel product has favorable margins, and the company is focused on leveraging existing client bases for new consumable product lines [41][42] Question: Why is the company focusing on the equine market? - The equine market represents a significant opportunity due to high penetration rates and the unique needs of equine veterinarians [43] Question: What are the plans for the small animal market? - The company is deploying a sales organization to penetrate the small animal market, leveraging its experience in the equine sector [76]

[Management Commentary](index=1&type=section&id=Management%20Commentary) The CEO highlighted a record first quarter, marking the 17th consecutive quarter of year-over-year revenue growth, driven by strong consumable usage, increased international sales, and new product line introduction - Achieved record year-over-year revenue for the 17th consecutive quarter, delivering the strongest first quarter in company history[2](index=2&type=chunk) - International sales increased by **32%** compared to Q1 2024, driven by organic growth and new distributor partnerships[4](index=4&type=chunk) - Gross margin improved to **68%** in Q1 2025, compared to 66% in Q1 2024[4](index=4&type=chunk) - The company expanded its portfolio with the introduction of the new VETIGEL® product line to support future recurring sales revenue[3](index=3&type=chunk) [Financial Performance](index=1&type=section&id=Financial%20Performance) Zomedica's Q1 2025 revenue grew 4% year-over-year to $6.5 million, but a GAAP net loss of $63.8 million was recorded due to a significant non-cash impairment charge [Revenue Analysis](index=1&type=section&id=Revenue%20Analysis) Total revenue for Q1 2025 increased by 4% to $6.5 million, led by a 13% rise in Consumables and an 8% increase in Therapeutics, despite a 25% decline in Diagnostics Q1 2025 Revenue Breakdown vs. Q1 2024 | Category | Revenue (Q1 2025) | YoY Change | Note | | :--- | :--- | :--- | :--- | | **Total Revenue** | **$6.5 million** | **+4%** | 17th straight quarter of YoY growth | | Consumables | $4.5 million | +13% | Driven by TRUFORMA and PulseVet reorders | | Capital | $2.0 million | -12% | Impacted by non-recurring large orders in Q1 2024 | | **By Segment** | | | | | Therapeutics | $5.9 million | +8% | PulseVet® and Assisi® products | | Diagnostics | $0.6 million | -25% | Due to non-repeating large VetGuardian orders in Q1 2024 | [Profitability and Expenses](index=2&type=section&id=Profitability%20and%20Expenses) Gross margin for Q1 2025 was strong at 68%, with total operating expenses of $69.0 million heavily influenced by a $55.8 million non-cash impairment charge - A non-cash impairment charge of **$55.8 million** was recorded, triggered by the decline in the Company's market capitalization[11](index=11&type=chunk) Operating Expenses (Q1 2025 vs Q1 2024) | Expense Category | Q1 2025 | YoY Change | Reason for Change | | :--- | :--- | :--- | :--- | | Adjusted Operating Expenses* | $13.2 million | -9% | Lower G&A costs | | Research & Development | $1.9 million | +5% | Buildup of internal development capabilities | | Selling & Marketing | $5.0 million | +22% | Increased sales department headcount | | General & Administrative | $6.3 million | -27% | Non-recurrence of specialized professional fees | [Net Loss and EBITDA](index=2&type=section&id=Net%20Loss%20and%20EBITDA) The company reported a GAAP net loss of $63.8 million for Q1 2025, significantly higher than the prior year, primarily due to a $55.8 million impairment charge Profitability Metrics (Q1 2025 vs Q1 2024) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Loss (GAAP) | $(63.8) million | $(9.2) million | | Non-GAAP EBITDA Loss | $(61.7) million | $(7.5) million | | **Adjusted Non-GAAP EBITDA Loss** | **$(5.7) million** | **$(5.3) million** | [Liquidity and Outstanding Share Capital](index=2&type=section&id=Liquidity%20and%20Outstanding%20Share%20Capital) As of March 31, 2025, Zomedica maintained a solid liquidity position with $64.6 million in cash, cash equivalents, and available-for-sale securities, with approximately 980 million common shares outstanding - The company held **$64.6 million** in cash, cash equivalents, and available-for-sale securities as of March 31, 2025, compared to $71.4 million at the end of 2024[18](index=18&type=chunk) - As of March 31, 2025, there were **979,949,668** common shares issued and outstanding[18](index=18&type=chunk) [Conference Call Information](index=2&type=section&id=Conference%20Call%20Information) Zomedica scheduled a conference call and webcast for 4:30 p.m. ET on May 15, 2025, to review its first-quarter 2025 financial and operational results, with a replay accessible until May 29, 2025 - A conference call to discuss Q1 2025 financial results was scheduled for Thursday, May 15, 2025, at 4:30 p.m. Eastern Time[20](index=20&type=chunk) - A dial-in replay of the conference call will be available until May 29, 2025, using replay pin number 1148151[21](index=21&type=chunk) [Non-GAAP Financial Measures](index=4&type=section&id=Non-GAAP%20Financial%20Measures) This section defines the non-GAAP measures used by the company, such as Non-GAAP EBITDA and Adjusted Non-GAAP EBITDA, and provides a detailed reconciliation table - The company uses non-GAAP measures to evaluate operating performance; Adjusted Non-GAAP EBITDA excludes impairment charges and other non-recurring items from Non-GAAP EBITDA[30](index=30&type=chunk)[31](index=31&type=chunk) Reconciliation of Net Loss to Adjusted Non-GAAP EBITDA Loss | Line Item | Three Months Ended March 31, 2025 (in thousands) | | :--- | :--- | | Net loss and comprehensive loss | $(63,765) | | Impairment expense | $55,833 | | Amortization expense | $1,692 | | Depreciation expense | $521 | | Stock-compensation expense | $618 | | Interest income | $(730) | | Proforma adjustments | $143 | | **Adjusted Non-GAAP EBITDA loss** | **$(5,745)** |