Company Performance - InspireMD, Inc. reported a quarterly loss of $0.19 per share, slightly better than the Zacks Consensus Estimate of a loss of $0.20, but worse than the loss of $0.16 per share from the previous year, indicating a 19% increase in loss year-over-year [1] - The company posted revenues of $1.95 million for the quarter ended December 2024, exceeding the Zacks Consensus Estimate by 6.50% and showing a year-over-year increase from $1.76 million [2] - InspireMD has surpassed consensus EPS estimates two times and revenue estimates three times over the last four quarters [2] Stock Movement and Outlook - InspireMD shares have increased by approximately 6.1% since the beginning of the year, contrasting with the S&P 500's decline of 5.3% [3] - The company's future stock performance will largely depend on management's commentary during the earnings call and the trends in earnings estimate revisions [3][4] - The current consensus EPS estimate for the upcoming quarter is -$0.14 on revenues of $1.88 million, and for the current fiscal year, it is -$0.73 on revenues of $10.54 million [7] Industry Context - The Medical - Instruments industry, to which InspireMD belongs, is currently ranked in the top 34% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8] - AngioDynamics, another company in the same industry, is expected to report a quarterly loss of $0.13 per share, reflecting an 18.8% year-over-year change, with revenues projected to be $70.58 million, down 6.1% from the previous year [9]

Revenue Performance - Revenue decreased by 7.9% to $72.8 million for the three months ended November 30, 2024, and decreased by 11.0% to $140.3 million for the six months ended November 30, 2024[118]. - Med Tech segment revenue grew by 24.4% in the second quarter of fiscal year 2025, while Med Device revenue declined by 23.1%[119]. - Auryon sales increased by $2.5 million and $5.2 million for the three and six months ended November 30, 2024, respectively[123]. Profitability - Gross profit increased by 390 basis points to 54.8% for the three months ended November 30, 2024, and increased by 370 basis points to 54.6% for the six months ended November 30, 2024[118]. - Net loss decreased by $18.3 million to $10.7 million for the three months ended November 30, 2024, and net income decreased by $40.4 million to $23.5 million for the six months ended November 30, 2024[118]. - Total company gross profit decreased by $0.4 million and $3.7 million for the three and six months ended November 30, 2024, compared to the same period in the prior year[128]. - Med Tech segment gross profit increased by $4.3 million and $5.3 million for the three and six months ended November 30, 2024, compared to the same period in the prior year, respectively[128]. - Med Device segment gross profit decreased by $4.7 million and $9.0 million for the three and six months ended November 30, 2024, compared to the same period in the prior year, respectively[131]. Cost Management - The restructuring plan is expected to generate $15.0 million in annual cost savings in fiscal year 2027[116]. - Research and development expenses decreased by $2.2 million and $3.9 million for the three and six months ended November 30, 2024, compared to the same period in the prior year[134]. - Selling and marketing expenses increased by $0.1 million for the three months ended November 30, 2024, but decreased by $1.6 million for the six months ended November 30, 2024, compared to the same period in the prior year[135]. Cash Flow and Liquidity - Cash used in operations decreased by $4.9 million to $15.8 million for the six months ended November 30, 2024[118]. - Operating activities generated a cash outflow of $15.8 million for the six months ended November 30, 2024, compared to an outflow of $20.6 million for the same period in the prior year[143]. - Cash and cash equivalents totaled $54.1 million as of November 30, 2024, down from $76.1 million as of May 31, 2024[143]. - The company believes its current cash balance, along with cash generated from operations, will provide sufficient liquidity for at least the next 12 months[147]. Debt and Financing - The company did not have any outstanding debt as of November 30, 2024[143]. - The company repaid $50.0 million under its Credit Agreement in connection with the completion of the dialysis and BioSentry divestiture in the first quarter of fiscal year 2024[149]. - The company received $100.0 million in cash from the divestiture of the dialysis and BioSentry businesses in the first quarter of fiscal year 2024[144]. Sales and Customer Concentration - The backlog of sales orders was $0.7 million as of November 30, 2024[122]. - No single customer represents more than 10% of total sales, limiting concentration of credit risk with respect to trade accounts receivable[153]. - Approximately 3.4% of the company's sales for the six months ended November 30, 2024, were denominated in foreign currencies, exposing profitability to currency fluctuations[151]. Shareholder Actions - The Company repurchased 72,141 shares for $0.5 million and 171,706 shares for $1.1 million under the share repurchase program[117]. - The company used $1.7 million for the repurchase of common shares in the first quarter of fiscal year 2025[149]. Internal Controls - There were no changes in internal control over financial reporting that materially affected the company for the fiscal quarter ended November 30, 2024[155].

Financial Data and Key Metrics - The company will discuss expected revenue, adjusted earnings, and gross margins for fiscal year 2025 during the call [3] - Management will use non-GAAP and pro forma financial measures to establish operational goals and review performance, which may help investors analyze underlying business trends [5] Business Line Data and Key Metrics - No specific data or metrics related to individual business lines were provided in the content Market Data and Key Metrics - No specific data or metrics related to individual markets were provided in the content Company Strategy and Industry Competition - No specific details on company strategy or industry competition were provided in the content Management Commentary on Operating Environment and Future Outlook - Management will make forward-looking statements about future events, including expected revenue, adjusted earnings, and gross margins for fiscal year 2025 [3] - Management encourages reviewing past and future SEC filings to understand factors that may cause actual results to differ from forward-looking statements [4] Other Important Information - The earnings call is being broadcast live on the company's website, with a replay available approximately one hour after the call ends [2] - Listeners are cautioned about the forward-looking nature of the statements made during the call [3] Q&A Session Summary - No Q&A session details were provided in the content

Financial Performance - Q2 FY25 net sales were $73.0 million, a 9.2% YoY increase[3][8] - Net sales for the three months ended November 30, 2024, were $73.015 million, a decrease from $79.073 million in the same period last year[32] - Net sales for the six months ended November 30, 2024, were $140.515 million, down from $157.752 million in the same period last year[36] - Net sales for the three months ended Nov 30, 2024 were $72,845 thousand, down 7.9% from $79,073 thousand in the prior year period[56] - Total net sales decreased by 11.0% to $140.336 million for the six months ended November 30, 2024, compared to $133.627 million in the same period last year[61] Med Tech Segment Performance - Med Tech net sales grew 25.0% YoY to $31.5 million, driven by strong performance in Auryon, AngioVac, AlphaVac, and NanoKnife disposables[3][8][9] - Med Tech net sales for the three months ended Nov 30, 2024 were $31,554 thousand, up 24.4% from $25,363 thousand in the prior year period[56] - Med Tech segment revenue increased by 27.2% to $20.113 million for the three months ended November 30, 2024, compared to $15.783 million in the same period last year[58] - Net sales for the Med Tech segment grew by 16.2% to $59.523 million for the six months ended November 30, 2024, compared to $50.971 million in the same period last year[61] - Gross profit for the Med Tech segment increased by 16.2% to $37.810 million for the six months ended November 30, 2024, compared to $32.471 million in the same period last year[63] Med Device Segment Performance - Med Device net sales decreased 0.4% YoY to $41.5 million, with U.S. sales growing 1.6%[3][10] - Med Device net sales for the three months ended Nov 30, 2024 were $41,291 thousand, down 23.1% from $53,710 thousand in the prior year period[56] - Med Device segment revenue decreased by 19.0% to $19.793 million for the three months ended November 30, 2024, compared to $20.889 million in the same period last year[58] - Net sales for the Med Device segment declined by 24.1% to $80.813 million for the six months ended November 30, 2024, compared to $82.656 million in the same period last year[61] - Gross profit for the Med Device segment decreased by 18.8% to $38.820 million for the six months ended November 30, 2024, compared to $40.808 million in the same period last year[63] Profitability and Margins - Adjusted EBITDA for Q2 FY25 was $3.1 million, compared to $(0.0) million in Q2 FY24[6][14] - Gross margin for Q2 FY25 was 54.7%, with Med Tech gross margin at 63.7% and Med Device gross margin at 47.8%[11][12] - Gross profit margin for the three months ended November 30, 2024, was 54.7%, up from 50.9% in the same period last year[32] - Gross profit margin for the six months ended November 30, 2024, was 54.6%, up from 50.9% in the same period last year[36] - Total gross profit percentage increased to 54.8% for the three months ended November 30, 2024, up from 50.9% in the same period last year[58] - Total gross profit percentage increased to 54.6% for the six months ended November 30, 2024, up from 50.9% in the same period last year[63] Net Loss and Adjusted Metrics - Net loss for the three months ended November 30, 2024, was $10.728 million, compared to a net loss of $29.702 million in the same period last year[32] - Net loss for the six months ended November 30, 2024, was $23.671 million, compared to a net loss of $32.432 million in the same period last year[36] - Adjusted net loss for the three months ended November 30, 2024, was $1.742 million, compared to an adjusted net loss of $2.038 million in the same period last year[39] - Adjusted net loss for the six months ended November 30, 2024, was $6.137 million, compared to an adjusted net loss of $6.869 million in the same period last year[39] - Adjusted diluted loss per share for the three months ended November 30, 2024, was $0.04, compared to $0.05 in the same period last year[40] - Adjusted diluted loss per share for the six months ended November 30, 2024, was $0.15, compared to $0.17 in the same period last year[40] - Net income (loss) for the three months ended Nov 30, 2024 was $(10,738) thousand, compared to $(29,048) thousand in the same period last year[43] - Adjusted EBITDA for the three months ended Nov 30, 2024 was $3,040 thousand, up from $1,819 thousand in the prior year period[43] - Pro forma net loss for the three months ended Nov 30, 2024 was $(10,728) thousand, an improvement from $(29,702) thousand in the prior year period[45] - Adjusted pro forma net loss for the three months ended Nov 30, 2024 was $(1,726) thousand, compared to $(3,365) thousand in the prior year period[45] - Net income (loss) for the three months ended Nov 30, 2024 was $(10.7 million), compared to $(29.0 million) in the same period last year[68] - Net income (loss) for the six months ended Nov 30, 2024 was $(23.5 million), compared to $16.8 million in the same period last year[68] Cash Flow and Liquidity - The company generated $2.5 million in operating cash flow and had $54.1 million in cash and cash equivalents at the end of Q2 FY25[15] - Cash and cash equivalents decreased to $54.089 million as of November 30, 2024, compared to $76.056 million as of May 31, 2024[66] - Net cash provided by operating activities for the three months ended Nov 30, 2024 was $2.5 million, down from $5.3 million in the prior year period[68] - Net cash used in operating activities for the six months ended Nov 30, 2024 was $(15.8 million), compared to $(20.6 million) in the prior year period[68] - Cash and cash equivalents decreased by $916 thousand for the three months ended Nov 30, 2024, compared to an increase of $3.3 million in the prior year period[68] - Cash and cash equivalents decreased by $22.0 million for the six months ended Nov 30, 2024, compared to an increase of $16.3 million in the prior year period[68] Capital Expenditures and Stock Repurchases - Additions to property, plant and equipment totaled $797 thousand for the three months ended Nov 30, 2024, up from $554 thousand in the prior year period[68] - Repurchase of common stock totaled $1.1 million for the three months ended Nov 30, 2024, compared to $0 in the prior year period[68] - Additions to property, plant and equipment totaled $1.9 million for the six months ended Nov 30, 2024, up from $1.3 million in the prior year period[68] - Repurchase of common stock totaled $1.7 million for the six months ended Nov 30, 2024, compared to $0 in the prior year period[68] Regulatory and Clinical Developments - NanoKnife System received FDA 510(k) clearance for prostate tissue ablation in December 2024[6][19] - NanoKnife System achieved all primary endpoints in the PRESERVE clinical trial, with 84.0% of patients free from in-field, clinically significant disease at 12 months[23] - CPT Category I codes for NanoKnife System's IRE technology for prostate and liver lesions will be effective January 1, 2026, facilitating reimbursement and market access[17][18] Guidance and Outlook - FY25 guidance updated: net sales expected to be $282-$288 million (4.2%-6.4% growth), Med Tech sales growth raised to 12%-15%, and Adjusted EBITDA now expected to be $1.0-$3.0 million[24] Restructuring and Plant Closure - Plant closure expenses for the three months ended Nov 30, 2024 were $5,102 thousand, related to the restructuring of the manufacturing footprint[51] Geographic Sales Performance - U.S. net sales for the three months ended Nov 30, 2024 were $62,678 thousand, down 2.1% from $64,002 thousand in the prior year period[56] - International net sales for the three months ended Nov 30, 2024 were $10,167 thousand, down 32.5% from $15,071 thousand in the prior year period[56]

Part I: Financial Information [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) Net sales decreased to $67.5 million, resulting in a $12.8 million net loss, driven by divestitures and a prior-year asset sale gain [Consolidated Statements of Operations](index=4&type=section&id=Consolidated%20Statements%20of%20Operations) Net sales decreased 14.2% to $67.5 million, leading to a $13.1 million operating loss and a $12.8 million net loss, contrasting with prior-year's $47.8 million asset sale gain Consolidated Statements of Operations (unaudited) | Metric | Three Months Ended Aug 31, 2024 (in thousands) | Three Months Ended Aug 31, 2023 (in thousands) | | :--- | :--- | :--- | | Net sales | $67,491 | $78,679 | | Gross profit | $36,724 | $40,060 | | Total operating expenses | $49,822 | $52,872 | | Gain on sale of assets | $0 | $47,842 | | Operating income (loss) | $(13,098) | $35,030 | | Net income (loss) | $(12,798) | $45,884 | | Diluted earnings (loss) per share | $(0.31) | $1.15 | [Consolidated Balance Sheets](index=6&type=section&id=Consolidated%20Balance%20Sheets) Cash and cash equivalents decreased to $55.0 million, with total assets declining to $293.6 million and total liabilities to $97.0 million as of August 31, 2024 Key Balance Sheet Items (unaudited) | Metric | Aug 31, 2024 (in thousands) | May 31, 2024 (in thousands) | | :--- | :--- | :--- | | Cash and cash equivalents | $55,005 | $76,056 | | Total current assets | $172,594 | $193,253 | | Total assets | $293,628 | $317,671 | | Total current liabilities | $76,699 | $91,155 | | Total liabilities | $97,046 | $112,085 | | Total Stockholders' Equity | $196,582 | $205,586 | [Consolidated Statements of Cash Flows](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operating activities was $18.3 million, leading to a $21.1 million net decrease in cash and cash equivalents for the quarter Cash Flow Summary (unaudited) | Activity | Three Months Ended Aug 31, 2024 (in thousands) | Three Months Ended Aug 31, 2023 (in thousands) | | :--- | :--- | :--- | | Net cash used in operating activities | $(18,253) | $(25,899) | | Net cash (used in) provided by investing activities | $(2,405) | $98,442 | | Net cash used in financing activities | $(509) | $(59,590) | | **Increase (decrease) in cash** | **$(21,051)** | **$12,966** | [Notes to Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Key notes detail two major divestitures, revenue disaggregation, a Becton Dickinson legal settlement, a manufacturing restructuring plan, and a new share repurchase program - The company completed the sale of its Dialysis and BioSentry businesses to Merit Medical for **$100.0 million** in cash in Q1 FY2024, resulting in a pre-tax gain of **$47.8 million**[42](index=42&type=chunk) - The company completed the sale of its PICC and Midline businesses to Spectrum Vascular in Q3 FY2024 for **$34.5 million** in cash, plus potential earn-outs and milestone payments[39](index=39&type=chunk) - On January 5, 2024, the company announced a restructuring of its manufacturing footprint to an outsourced model, expected to be completed in Q3 FY2026 with total estimated costs of **$38.5 million to $53.5 million**. Restructuring charges of **$3.6 million** were recorded in the quarter[100](index=100&type=chunk)[101](index=101&type=chunk) - A settlement was reached with Becton, Dickinson and Company (BD) to resolve ongoing patent litigation, involving a one-time payment of **$7.0 million**, six minimum annual payments of **$2.5 million**, and potential additional payments[96](index=96&type=chunk) [Management's Discussion and Analysis (MD&A)](index=23&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Quarterly revenue decreased 14.2% to $67.5 million due to divestitures, despite Med Tech growth, resulting in a $12.8 million net loss and a $21.1 million decrease in cash [Results of Operations](index=24&type=section&id=Results%20of%20Operations) Net sales decreased by $11.2 million due to Med Device divestitures, partially offset by Med Tech growth, while gross margin improved to 54.4% despite a fall in gross profit Net Sales by Segment (in thousands) | Segment | Q1 FY2025 (Aug 31, 2024) | Q1 FY2024 (Aug 31, 2023) | $ Change | | :--- | :--- | :--- | :--- | | Med Tech | $27,969 | $25,860 | $2,109 | | Med Device | $39,522 | $52,819 | $(13,297) | | **Total** | **$67,491** | **$78,679** | **$(11,188)** | Gross Profit by Segment (in thousands) | Segment | Q1 FY2025 (Aug 31, 2024) | Q1 FY2024 (Aug 31, 2023) | Gross Margin % (Q1 FY25 vs Q1 FY24) | | :--- | :--- | :--- | :--- | | Med Tech | $17,697 | $16,727 | 63.3% vs 64.7% | | Med Device | $19,027 | $23,333 | 48.1% vs 44.2% | | **Total** | **$36,724** | **$40,060** | **54.4% vs 50.9%** | - The decrease in Med Device sales was primarily driven by the divestiture of PICCs and Midline products (**$10.2 million** impact) and dialysis and BioSentry products (**$0.8 million** impact)[122](index=122&type=chunk) - Acquisition, restructuring and other items increased by **$1.1 million**, mainly due to a **$3.6 million** increase in plant closure expenses related to the manufacturing restructuring plan[133](index=133&type=chunk) [Liquidity and Capital Resources](index=28&type=section&id=Liquidity%20and%20Capital%20Resources) Cash and cash equivalents decreased to $55.0 million due to $18.3 million cash used in operations, with no outstanding debt, and sufficient liquidity for 12 months Cash and Debt Position (in millions) | Metric | Aug 31, 2024 | May 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $55.0 | $76.1 | | Outstanding Debt | $0.0 | $0.0 | - Cash used in operating activities was **$18.3 million**, an improvement from the **$25.9 million** used in the prior-year period[137](index=137&type=chunk)[138](index=138&type=chunk) - In the prior-year quarter (Q1 FY2024), investing activities provided **$98.4 million** cash from the divestiture of the dialysis and BioSentry businesses, while financing activities used **$59.6 million** for debt repayment and contingent consideration[137](index=137&type=chunk)[140](index=140&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=30&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces foreign currency exchange rate risk on 3.4% of sales and limited credit risk due to a diversified customer base - Approximately **3.4%** of sales in the quarter were denominated in foreign currencies, exposing the company to exchange rate fluctuations[145](index=145&type=chunk) - Credit risk is mitigated as no single customer represents more than **10%** of total sales[147](index=147&type=chunk) [Controls and Procedures](index=31&type=section&id=Item%204.%20Controls%20and%20Procedures) Disclosure controls and procedures were effective as of August 31, 2024, with no material changes in internal control over financial reporting during the quarter - Management concluded that disclosure controls and procedures were effective as of the end of the period[149](index=149&type=chunk) - No changes in internal control over financial reporting occurred during the quarter that materially affected, or are reasonably likely to materially affect, internal controls[150](index=150&type=chunk) Part II: Other Information [Legal Proceedings](index=32&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to Note 14 of the financial statements for detailed information on commitments and contingencies, including litigation updates - For details on legal proceedings, the report directs readers to Note 14, "Commitments and Contingencies," in the consolidated financial statements[153](index=153&type=chunk) [Risk Factors](index=32&type=section&id=Item%201A.%20Risk%20Factors) The company highlights a potential risk related to future financing needs, having extinguished its Credit Agreement and requiring new external financing for growth or changing circumstances - The company repaid all amounts under its Credit Agreement in June 2023, which was then extinguished. This could pose a risk if additional financing is needed for future growth initiatives or acquisitions[155](index=155&type=chunk) [Issuer Purchases of Equity Securities](index=32&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased 72,141 shares under a new **$15.0 million** program, with approximately **$14.4 million** remaining for future repurchases Share Repurchase Activity (Three Months Ended Aug 31, 2024) | Period | Total Shares Purchased as Part of Program (shares) | Average Price Paid per Share (USD) | Maximum Value Remaining for Repurchase (USD) | | :--- | :--- | :--- | :--- | | July 1 - July 31, 2024 | 72,141 | $6.68 | $14,448,871 | - A new share repurchase program authorizing up to **$15.0 million** was approved and announced on July 16, 2024[157](index=157&type=chunk) [Other Information](index=32&type=section&id=Item%205.%20Other%20Information) No directors or officers adopted or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the quarter - No directors or officers adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the quarter[159](index=159&type=chunk)

Financial Data and Key Metrics Changes - Total worldwide revenue for Q1 FY 2025 was $67.5 million, representing a year-over-year growth of just over 1% [8][20] - Adjusted EBITDA loss was $200,000, an improvement from a loss of $1.1 million in Q1 FY 2024 [9][25] - Adjusted net loss for Q1 FY 2025 was $4.4 million, or $0.11 per share, compared to a loss of $6.2 million or $0.16 per share in the prior year [24][25] Business Line Data and Key Metrics Changes - MedTech segment revenue was $28 million, an increase of 8.7% year-over-year, while Med Device revenue was $39.5 million, a 3.6% increase [20] - Auryon revenue grew 24.9% to $13.7 million, while AlphaVac revenue increased by over 21% [20][21] - NanoKnife revenue declined by 6.9% to approximately $5.1 million due to a tough year-over-year comparison [13][22] Market Data and Key Metrics Changes - The U.S. Med Device business increased by 2.1% year-over-year, while international business faced challenges due to timing of orders [16][20] - The MedTech segment now comprises 41.4% of total revenue, up from 38.5% a year ago [20] Company Strategy and Development Direction - The company is focused on increasing penetration in the hospital market for Auryon and expanding its geographic reach in Europe [28][29] - Continued investment in clinical data and product enhancements for AlphaVac is planned to drive adoption [30] - The transition to outsourced manufacturing is expected to generate approximately $15 million in annualized savings by FY 2027 [17][40] Management Comments on Operating Environment and Future Outlook - Management expressed optimism about the growth opportunities within the MedTech segment, with a total addressable market now estimated at $10 billion [28] - The company remains on track to achieve previously issued guidance for FY 2025, expecting revenue growth of 4.2% to 6.4% [26][27] Other Important Information - The company has zero debt and had $55 million in cash and cash equivalents as of August 31, 2024 [25] - A stock repurchase program was approved, allowing for purchases of up to $15 million of outstanding common shares [25][26] Q&A Session Summary Question: Can you provide further details on the AlphaVac PE launch ramp? - Management reported positive feedback from physicians regarding AlphaVac's design and efficiency, with ongoing measurement of new customer interactions [32][33] Question: What initiatives are being targeted for the Auryon hospital market? - The company is shifting focus to hospital customers, leveraging existing familiarity with Auryon from outpatient settings [36][38] Question: What are the expected savings from the manufacturing transition? - The transition is on track, with significant savings anticipated at the end of the program, expected to total $15 million [39][40] Question: What is the timeline for NanoKnife's CPT pathway? - The reimbursement process is complex, and while timelines are uncertain, the company is parallel-pathing the FDA and reimbursement processes [44][46] Question: What is the outlook for cash flow breakeven? - Management expects to reach cash flow positivity by the end of FY 2026, with Q1 being the highest cash utilization quarter [49][50]

Financial Performance - AngioDynamics achieved pro forma revenue growth of 1.1% year-over-year[3] - MedTech segment pro forma revenue grew by 8.7% year-over-year[3] - Auryon sales reached $13.7 million, a 24.9% increase year-over-year[3] - AlphaVac sales amounted to $2.2 million, reflecting a 21.1% year-over-year growth[3] - The company reported a pro forma Adjusted EBITDA loss of ($0.2) million, an improvement from ($1.1) million in Q1 FY24[3] - Full Year Net Sales guidance is $282 - $288 million[28] Product & Regulatory Milestones - The Auryon System received CE Mark approval in Europe[3] - An FDA submission was filed for NanoKnife prostate indication[3] - The RECOVER-AV clinical trial was initiated[3] - Cumulative sales of Auryon are over $140 million since its launch in September 2020[5] - FDA 510(k) & CE Mark for PE was received for AlphaVac in Q4 FY24[13]

[Financial & Operational Highlights](index=1&type=section&id=Financial%20%26%20Operational%20Highlights) AngioDynamics reported 1.1% pro forma net sales growth in Q1 FY2025, driven by Med Tech, while achieving key regulatory and clinical milestones Q1 FY2025 Pro Forma Net Sales Overview | Metric | August 31, 2024 | Pro Forma YoY Growth | | :--- | :--- | :--- | | Net Sales | $67.5 million | 1.1% | | Med Tech Net Sales | $28.0 million | 8.7% | | Med Device Net Sales | $39.5 million | (3.6)% | Q1 FY2025 Key Profitability Metrics | Metric | Value | | :--- | :--- | | GAAP Gross Margin | 54.4% | | GAAP Loss Per Share | $0.31 | | Adjusted Loss Per Share | $0.11 | - Key operational milestones include submitting the NanoKnife System for FDA 510(k) clearance for prostate tissue, receiving CE Mark approval for the Auryon System in Europe, and initiating the RECOVER-AV clinical trial[2](index=2&type=chunk) - The CEO highlighted a strong start to FY2025, driven by **over 20% growth in both Auryon and AlphaVac**, viewing the fiscal year as an inflection point for the business[3](index=3&type=chunk) [Detailed Financial Performance (Q1 FY2025)](index=1&type=section&id=Detailed%20Financial%20Performance%20%28Q1%20FY2025%29) AngioDynamics reported Q1 FY2025 pro forma net sales of $67.5 million, driven by Med Tech growth, alongside a GAAP net loss of $12.8 million and an adjusted net loss of $4.4 million [Revenue Analysis](index=2&type=section&id=Revenue%20Analysis) Med Tech sales grew 8.7% to $28.0 million, driven by Auryon and AlphaVac, while Med Device sales declined 3.6% and international sales decreased significantly Q1 FY2025 Net Sales by Segment and Product | Segment / Product | Q1 FY2025 Sales | YoY Growth | | :--- | :--- | :--- | | **Med Tech** | **$28.0 million** | **8.7%** | | - Auryon | $13.7 million | 24.9% | | - AlphaVac | $2.2 million | 21.1% | | - NanoKnife | $5.1 million | (6.9)% | | **Med Device** | **$39.5 million** | **(3.6)%** | Q1 FY2025 Net Sales by Geography | Geography | Q1 FY2025 Sales | YoY Growth | | :--- | :--- | :--- | | U.S. Net Sales | $59.5 million | 6.2% | | International Net Sales | $8.0 million | (25.4)% | [Profitability Analysis](index=2&type=section&id=Profitability%20Analysis) Overall gross margin for Q1 FY2025 was 54.4%, a 40 basis point decrease, leading to a GAAP net loss of $12.8 million and an adjusted net loss of $4.4 million, despite an improved adjusted EBITDA Q1 FY2025 Gross Margin by Segment | Margin Metric | Q1 FY2025 | YoY Change | | :--- | :--- | :--- | | Overall Gross Margin | 54.4% | -40 bps | | Med Tech Gross Margin | 63.3% | -160 bps | | Med Device Gross Margin | 48.2% | -40 bps | Q1 FY2025 Profitability Summary | Profitability Metric | Q1 FY2025 | Q1 FY2024 | | :--- | :--- | :--- | | GAAP Net Loss | $(12.8) million | - | | GAAP Loss Per Share | $(0.31) | - | | Adjusted Net Loss | $(4.4) million | $(6.2) million | | Adjusted Loss Per Share | $(0.11) | $(0.16) | | Adjusted EBITDA | $(0.2) million | $(1.1) million | [Cash Flow and Balance Sheet](index=2&type=section&id=Cash%20Flow%20and%20Balance%20Sheet) AngioDynamics used $18.3 million in operating cash during Q1 FY2025, consistent with historical trends, resulting in $55.0 million in cash and cash equivalents as of August 31, 2024 - Used **$18.3 million** in operating cash during Q1 FY2025, consistent with historical trends for the first fiscal quarter[8](index=8&type=chunk) Cash and Cash Equivalents | Date | Cash and Cash Equivalents | | :--- | :--- | | August 31, 2024 | $55.0 million | | May 31, 2024 | $76.1 million | [Business & Clinical Updates](index=3&type=section&id=Business%20%26%20Clinical%20Updates) AngioDynamics achieved significant regulatory and clinical progress, including FDA submission for NanoKnife, European CE Mark for Auryon, and initiation of the RECOVER-AV clinical trial for AlphaVac - **NanoKnife System:** Submitted results from the PRESERVE pivotal study to the FDA for 510(k) clearance for the ablation of prostate tissue in intermediate-risk patients[10](index=10&type=chunk) - **Auryon System:** Received European CE Mark approval, allowing marketing in Europe for treating Peripheral Artery Disease (PAD) and expanding reach into a **$1.1 billion** global PAD market[11](index=11&type=chunk) - **AlphaVac System:** Initiated the RECOVER-AV clinical trial in Europe to evaluate the AlphaVac F18⁸⁵ System for treating acute, intermediate-risk pulmonary embolism (PE), enrolling patients across up to 20 hospital sites[12](index=12&type=chunk) [Fiscal Year 2025 Financial Guidance](index=3&type=section&id=Fiscal%20Year%202025%20Financial%20Guidance) AngioDynamics reaffirmed its FY2025 financial guidance, projecting net sales between $282 to $288 million, driven by Med Tech growth, and an adjusted EBITDA loss between $0 and $2.5 million FY2025 Financial Guidance | Metric | FY2025 Guidance | | :--- | :--- | | Net Sales | $282 - $288 million | | Pro Forma Net Sales Growth | 4.2% - 6.4% | | Med Tech Net Sales Growth | 10% - 12% | | Med Device Net Sales Growth | 1% - 3% | | Gross Margin | 52% - 53% | | Adjusted EBITDA | $(2.5) million - $0 | | Adjusted Loss Per Share | $(0.38) - $(0.42) | [Financial Statements & Reconciliations](index=6&type=section&id=Financial%20Statements%20%26%20Reconciliations) Unaudited Q1 FY2025 financial statements, including Consolidated Income Statements, Balance Sheets, and Cash Flows, are presented with comprehensive GAAP to non-GAAP reconciliations [Consolidated Income Statements](index=6&type=section&id=Consolidated%20Income%20Statements) For Q1 FY2025, AngioDynamics reported net sales of $67.5 million, a gross profit of $36.7 million, an operating loss of $13.1 million, and a GAAP net loss of $12.8 million Q1 FY2025 Consolidated Income Statement Highlights | Income Statement (Q1 FY2025) | Amount (in thousands) | | :--- | :--- | | Net Sales | $67,491 | | Gross Profit | $36,724 | | Total Operating Expenses | $49,822 | | Operating Loss | $(13,098) | | Net Loss | $(12,798) | | Loss Per Share (Basic & Diluted) | $(0.31) | [Consolidated Balance Sheets](index=13&type=section&id=Consolidated%20Balance%20Sheets) As of August 31, 2024, total assets were $293.6 million, primarily due to a reduction in cash to $55.0 million, with total liabilities at $97.0 million and stockholders' equity at $196.6 million Consolidated Balance Sheet Highlights | Balance Sheet Item | Aug 31, 2024 (in thousands) | May 31, 2024 (in thousands) | | :--- | :--- | :--- | | Cash and cash equivalents | $55,005 | $76,056 | | Total Current Assets | $172,594 | $193,253 | | Total Assets | $293,628 | $317,671 | | Total Liabilities | $97,046 | $112,085 | | Total Stockholders' Equity | $196,582 | $205,586 | [Consolidated Statements of Cash Flows](index=14&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For Q1 FY2025, net cash used in operating activities was $18.3 million, investing activities $2.4 million, and financing activities $0.5 million, resulting in a total cash decrease of $21.1 million Q1 FY2025 Consolidated Cash Flow Summary | Cash Flow Item (Q1 FY2025) | Amount (in thousands) | | :--- | :--- | | Net cash used in operating activities | $(18,253) | | Net cash used in investing activities | $(2,405) | | Net cash used in financing activities | $(509) | | **Increase (decrease) in cash** | **$(21,051)** | [Non-GAAP Reconciliations](index=7&type=section&id=Non-GAAP%20Reconciliations) Detailed reconciliations from GAAP to non-GAAP and pro forma figures are provided, showing an adjusted net loss of $4.4 million and an adjusted EBITDA loss of $163 thousand for Q1 FY2025 - Adjusted net loss for Q1 FY2025 was **$(4.4) million**, reconciled from a GAAP net loss of **$(12.8) million** by excluding items such as amortization of intangibles (**$2.6 million**) and acquisition/restructuring costs (**$4.3 million**)[22](index=22&type=chunk) - Pro forma adjusted diluted loss per share for Q1 FY2025 was **$(0.11)**, an improvement from **$(0.16)** in the prior-year period[28](index=28&type=chunk) - Pro forma adjusted EBITDA for Q1 FY2025 was **$(152) thousand**, compared to **$(1,072) thousand** in Q1 FY2024[30](index=30&type=chunk)

Part I [Business](index=5&type=section&id=Item%201.%20Business) AngioDynamics is a medical technology company focused on vascular health and cancer treatment, operating through Med Tech and Med Device segments with a strategic shift to outsourced manufacturing - The company is transforming into a focused medical technology company by investing in high-growth platforms and divesting mature, lower-growth product lines[208](index=208&type=chunk) - A significant strategic initiative is the restructuring of its manufacturing footprint to a **fully outsourced model**, expected to be completed by the **third quarter of fiscal year 2026**[50](index=50&type=chunk)[203](index=203&type=chunk) - The business is organized into two segments: **Med Tech** (Auryon, Thrombectomy, NanoKnife) and **Med Device** (Peripheral Products, Ports, Venous Insufficiency, etc)[17](index=17&type=chunk) - Recent divestitures include the sale of the **BioSentry** and **dialysis** businesses to Merit Medical in June 2023, and the **PICC** and **Midline** businesses to Spectrum Vascular in February 2024[117](index=117&type=chunk)[118](index=118&type=chunk)[202](index=202&type=chunk) [Products](index=6&type=section&id=Products) The product portfolio spans Med Tech, featuring Auryon, AlphaVac/AngioVac, and NanoKnife, and Med Device, including vascular access and ablation systems - **Med Tech Products:** - **Auryon Atherectomy System:** Treats infrainguinal stenoses and occlusions in peripheral arteries[18](index=18&type=chunk) - **Thrombectomy Portfolio:** Includes **AlphaVac** and **AngioVac** systems for mechanical thrombectomy and various thrombolytic catheters[19](index=19&type=chunk) - **NanoKnife System:** Utilizes Irreversible Electroporation (IRE) for surgical ablation of soft tissue without thermal energy[23](index=23&type=chunk) - **Med Device Products:** - **Peripheral Products:** Angiographic catheters (**Soft-Vu**, **Accu-Vu**), guidewires, and drainage catheters[26](index=26&type=chunk) - **Vascular Access Ports:** **SmartPort**, **BioFlo**, and **Xcela Plus** ports for central venous access, featuring technologies like Vortex and BioFlo with Endexo[34](index=34&type=chunk) - **Venous Insufficiency:** **VenaCure EVLT** laser system for treating varicose veins[38](index=38&type=chunk) - **Microwave Ablation:** **Solero MTA System** for soft tissue ablation[38](index=38&type=chunk) [Competition, Sales, and Manufacturing](index=12&type=section&id=Competition%2C%20Sales%2C%20and%20Manufacturing) The company competes with major medical device firms, uses direct and distributor sales, and is transitioning to a fully outsourced manufacturing model by fiscal 2026 - Primary competitors include **Boston Scientific**, **Cook Medical**, **Medtronic**, **Johnson & Johnson**, and **Inari Medical**[44](index=44&type=chunk) - The company sells products through a **direct sales force** in the U.S. and a mix of **direct sales** and **distributor relationships** internationally[46](index=46&type=chunk) - The company is transitioning to a **fully outsourced manufacturing model** by **Q3 FY2026** to improve its cost structure[50](index=50&type=chunk) - At the end of fiscal year 2024, the company had a product backlog of **$1.3 million**, a decrease from **$2.7 million** in the prior year[51](index=51&type=chunk)[232](index=232&type=chunk) [Government Regulation](index=13&type=section&id=Government%20Regulation) Products are subject to extensive FDA and international regulations, including 510(k) clearance, QSR compliance, and EU MDR, alongside healthcare fraud and abuse laws - Products require marketing clearance from the FDA, primarily through the **510(k) process**, which demonstrates substantial equivalence to a predicate device[56](index=56&type=chunk)[57](index=57&type=chunk) - Manufacturing operations must comply with the FDA's **Quality System Regulation (QSR)** and are subject to periodic inspections[60](index=60&type=chunk) - For sales in the European Union, products must comply with the new **Medical Device Regulation (MDR)**, which has stricter requirements and longer certification timeframes (**12-18 months** or more) than previous directives[63](index=63&type=chunk) - The company is subject to federal and state anti-fraud laws, including the **Anti-kickback Statute** and the **False Claims Act**, which govern relationships with healthcare providers[67](index=67&type=chunk) [Risk Factors](index=18&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant business, regulatory, intellectual property, and market risks, including intense competition, product development reliance, and manufacturing transition challenges - The company faces **intense competition** from larger, better-resourced competitors and increasing price pressure from group purchasing organizations (GPOs)[83](index=83&type=chunk)[84](index=84&type=chunk)[86](index=86&type=chunk) - Future growth heavily relies on the successful completion of clinical trials and market adoption of key products like the **NanoKnife**, **AngioVac**, **AlphaVac**, and **Auryon** systems[89](index=89&type=chunk)[93](index=93&type=chunk) - The strategic shift to a **fully outsourced manufacturing model** by **FY2026** introduces risks related to execution, quality control, and reliance on third-party manufacturers, some of whom are located in China[101](index=101&type=chunk)[102](index=102&type=chunk)[105](index=105&type=chunk) - The business is subject to **extensive government regulation**, and failure to obtain or maintain marketing clearances (e.g., **FDA 510(k)**, **EU MDR**) could prevent product sales[160](index=160&type=chunk)[164](index=164&type=chunk) - Recent divestitures of product lines (**PICC**, **Midline**, **Dialysis**, **BioSentry**) may impact revenue, and there is a risk the company will be unable to replace the lost earnings and cash flow with higher-margin growth[117](index=117&type=chunk)[118](index=118&type=chunk)[119](index=119&type=chunk) [Unresolved Staff Comments](index=33&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports that it has no unresolved staff comments from the Securities and Exchange Commission - None[182](index=182&type=chunk) [Cyber Security](index=33&type=section&id=Item%201C.%20Cyber%20Security) AngioDynamics has implemented a cybersecurity risk management program based on the NIST Cyber Security Framework 2.0, overseen by the Board and Audit Committee - The company's cybersecurity program is based on the **NIST Cyber Security Framework 2.0** and is integrated into its **enterprise risk management (ERM) program**[182](index=182&type=chunk)[183](index=183&type=chunk) - Governance is led by the **SVP of IT**, with oversight from the **CEO**, the **Board of Directors**, and the **Audit Committee**[184](index=184&type=chunk)[185](index=185&type=chunk) - The company is **not aware of any cybersecurity incidents** to date that have had or are reasonably likely to have a material impact on the business[183](index=183&type=chunk) [Properties](index=33&type=section&id=Item%202.%20Properties) AngioDynamics operates from its Latham, NY headquarters, owns two manufacturing facilities, and leases several other facilities for various functions Property Locations and Types | Location | Purpose | Approx. Sq. Ft. | Property Type | | :--- | :--- | :--- | :--- | | Latham, NY | Corporate headquarters | 39,000 | Lease | | Glens Falls, NY | Manufacturing | 21,000 | Owned | | Queensbury, NY | Manufacturing | 135,000 | Owned | | Queensbury, NY | Distribution | 58,000 | Lease | | Marlborough, MA | Research and development | 8,400 | Lease | | Amsterdam, NL | Selling, marketing and administrative | 8,100 | Lease | | Rehovot, IL | Research and development | 4,300 | Lease | [Legal Proceedings](index=34&type=section&id=Item%203.%20Legal%20Proceedings) The company is involved in various legal proceedings, notably a patent litigation settlement with Becton, Dickinson and Company (BD) in March 2024 - On **March 31, 2024**, the company settled ongoing patent litigation with **Becton, Dickinson and Company (BD)** concerning implantable port products[450](index=450&type=chunk) - The settlement terms include a **$7.0 million** lump-sum payment, six minimum annual payments of **$2.5 million**, and potential future payments contingent on sales and an ongoing appeal[450](index=450&type=chunk) [Mine Safety Disclosures](index=34&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[190](index=190&type=chunk) Part II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=35&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) AngioDynamics' common stock trades on NASDAQ under ANGO, with no cash dividends paid or anticipated in the foreseeable future - The company's common stock trades on the **NASDAQ** under the symbol **ANGO**[191](index=191&type=chunk) - **No cash dividends** were paid in the last three fiscal years, and none are anticipated in the foreseeable future[193](index=193&type=chunk) Common Stock High and Low Sale Prices | Fiscal Year 2024 | High Sale Price | Low Sale Price | | :--- | :--- | :--- | | Fourth Quarter | $7.03 | $5.27 | | Third Quarter | $8.04 | $5.49 | | Second Quarter | $7.73 | $6.17 | | First Quarter | $11.16 | $8.00 | | Fiscal Year 2023 | High Sale Price | Low Sale Price | | :--- | :--- | :--- | | Fourth Quarter | $12.65 | $8.29 | | Third Quarter | $15.48 | $12.06 | | Second Quarter | $22.81 | $12.51 | | First Quarter | $24.30 | $17.83 | [Reserved](index=36&type=section&id=Item%206.%20%5BReserved%5D) This item is reserved [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=37&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) For FY2024, AngioDynamics reported a 10.3% revenue decrease to $303.9 million, a $184.3 million net loss due to goodwill impairment, and increased cash to $76.1 million from divestitures Key Financial Metrics | Metric | FY 2024 | FY 2023 | Change | | :--- | :--- | :--- | :--- | | Revenue | $303.9M | $338.8M | -10.3% | | Gross Profit % | 50.9% | 51.4% | -50 bps | | Net Loss | ($184.3M) | ($52.4M) | ($131.9M) | | Loss per Share | ($4.59) | ($1.33) | ($3.26) | | Cash from Operations | ($28.2M) | $0.1M | ($28.3M) | - The Med Tech business grew **10.0%**, driven by Auryon and NanoKnife sales, while the Med Device business decreased **18.4%**, primarily due to divestitures of non-core product lines[207](index=207&type=chunk) - A non-cash goodwill impairment charge of **$159.5 million** was recorded for the Med Tech reporting unit due to a sustained decline in the company's stock price[205](index=205&type=chunk)[243](index=243&type=chunk) - The company **extinguished all outstanding debt** in **June 2023** after completing the sale of the dialysis and BioSentry businesses[203](index=203&type=chunk)[250](index=250&type=chunk) [Results of Operations](index=41&type=section&id=Results%20of%20Operations) In FY2024, net sales decreased to $303.9 million, gross margin contracted to 50.9%, and a $159.5 million goodwill impairment led to a $192.4 million operating loss Net Sales (in thousands) | Net Sales (in thousands) | FY 2024 | FY 2023 | $ Change | | :--- | :--- | :--- | :--- | | Med Tech | $106,403 | $96,687 | $9,716 | | Med Device | $197,511 | $242,065 | ($44,554) | | **Total** | **$303,914** | **$338,752** | **($34,838)** | Gross Profit (in thousands) | Gross Profit (in thousands) | FY 2024 | FY 2023 | $ Change | | :--- | :--- | :--- | :--- | | Med Tech | $67,198 (63.2%) | $61,966 (64.1%) | $5,232 | | Med Device | $87,500 (44.3%) | $112,280 (46.4%) | ($24,780) | | **Total** | **$154,698 (50.9%)** | **$174,246 (51.4%)** | **($19,548)** | - A goodwill impairment charge of **$159.5 million** was recorded in FY2024, compared to **$14.5 million** in FY2023[242](index=242&type=chunk)[243](index=243&type=chunk) - Acquisition, restructuring and other items increased by **$37.5 million**, driven by a **$19.3 million** legal settlement with BD and **$9.5 million** in plant closure expenses[245](index=245&type=chunk) [Liquidity and Capital Resources](index=46&type=section&id=Liquidity%20and%20Capital%20Resources) As of May 31, 2024, the company held $76.1 million in cash with no debt, primarily due to $134.5 million from asset sales offsetting operating and financing cash uses Cash Flow Summary (in thousands) | Cash Flow Summary (in thousands) | FY 2024 | FY 2023 | | :--- | :--- | :--- | | Cash from Operating Activities | ($28,158) | $78 | | Cash from Investing Activities | $123,717 | ($9,746) | | Cash from Financing Activities | ($64,248) | $25,420 | | **Net Change in Cash** | **$31,436** | **$15,795** | - Cash and cash equivalents increased to **$76.1 million** at year-end, up from **$44.6 million** in the prior year[250](index=250&type=chunk) - **All outstanding debt** under the Credit Agreement was repaid and the agreement was extinguished in **June 2023**[254](index=254&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=48&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is foreign currency fluctuations, with minimal interest rate risk due to no outstanding debt and low credit risk from a diverse customer base - The primary market risk is foreign currency exchange rate fluctuation, as about **3.6%** of FY2024 sales were in foreign currencies[260](index=260&type=chunk) - Interest rate risk is not significant as the company has **no outstanding debt** as of **May 31, 2024**[261](index=261&type=chunk) - Credit risk is considered low, with **no single customer** representing more than **10%** of total sales[263](index=263&type=chunk) [Financial Statements and Supplementary Data](index=48&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section incorporates the company's audited consolidated financial statements and supplementary data by reference from Part IV of the Form 10-K - The financial statements and supplementary data required by this item are included in Part IV of the report[264](index=264&type=chunk) [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=48&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes in or disagreements with its accountants on accounting and financial disclosure - None[264](index=264&type=chunk) [Controls and Procedures](index=49&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded disclosure controls and internal control over financial reporting were effective as of May 31, 2024, with an unqualified audit opinion from Deloitte & Touche LLP - Management concluded that disclosure controls and procedures were **effective** as of **May 31, 2024**[266](index=266&type=chunk) - Management assessed internal control over financial reporting as **effective** based on the **2013 COSO framework**[268](index=268&type=chunk) - Deloitte & Touche LLP issued an **unqualified audit opinion** on the effectiveness of the company's internal control over financial reporting as of **May 31, 2024**[269](index=269&type=chunk)[273](index=273&type=chunk) [Other Information](index=51&type=section&id=Item%209B.%20Other%20Information) The company reports no other information for this item - None[279](index=279&type=chunk) [Foreign Jurisdictions that Prevent Inspections](index=51&type=section&id=Item%209C.%20Foreign%20Jurisdictions%20that%20Prevent%20Inspections) This item is not applicable to the company - Not applicable[279](index=279&type=chunk) Part III [Directors, Executive Officers and Corporate Governance](index=52&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information on directors, executive officers, and corporate governance is incorporated by reference from the 2024 Proxy Statement - Information is incorporated by reference from the registrant's Proxy Statement for its 2024 Annual Meeting of Stockholders[5](index=5&type=chunk)[282](index=282&type=chunk) [Executive Compensation](index=52&type=section&id=Item%2011.%20Executive%20Compensation) Executive compensation information is incorporated by reference from the 2024 Proxy Statement - Information is incorporated by reference from the registrant's Proxy Statement for its 2024 Annual Meeting of Stockholders[5](index=5&type=chunk)[283](index=283&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=52&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Security ownership information is incorporated by reference from the 2024 Proxy Statement - Information is incorporated by reference from the registrant's Proxy Statement for its 2024 Annual Meeting of Stockholders[5](index=5&type=chunk)[284](index=284&type=chunk) [Certain Relationships and Related Transactions, and Director Independence](index=52&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Information on related transactions and director independence is incorporated by reference from the 2024 Proxy Statement - Information is incorporated by reference from the registrant's Proxy Statement for its 2024 Annual Meeting of Stockholders[5](index=5&type=chunk)[285](index=285&type=chunk) [Principal Accounting Fees and Services](index=52&type=section&id=Item%2014.%20Principal%20Accounting%20Fees%20and%20Services) Principal accounting fees and services information is incorporated by reference from the 2024 Proxy Statement - Information is incorporated by reference from the registrant's Proxy Statement for its 2024 Annual Meeting of Stockholders[5](index=5&type=chunk)[286](index=286&type=chunk) Part IV [Exhibits, Financial Statement Schedules](index=53&type=section&id=Item%2015.%20Exhibits%2C%20Financial%20Statement%20Schedules) This section includes the company's consolidated financial statements, the independent auditor's report, schedules, and a list of exhibits [Report of Independent Registered Public Accounting Firm](index=54&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) Deloitte & Touche LLP issued unqualified opinions on AngioDynamics' financial statements and internal controls, highlighting inventory valuation and goodwill impairment as Critical Audit Matters - The auditor, Deloitte & Touche LLP, issued an **unqualified opinion** on both the financial statements and the effectiveness of internal control over financial reporting[293](index=293&type=chunk) - **Critical Audit Matters (CAMs)** identified were: 1. **Inventories – Excess Quantities and Obsolescence:** Due to significant management estimates and assumptions regarding expected demand[296](index=296&type=chunk) 2. **Goodwill - Valuation of Goodwill for the Med Tech Reporting Unit:** Due to judgmental assumptions in the fair value estimate, including revenue growth rates and discount rates[298](index=298&type=chunk) [Consolidated Financial Statements](index=56&type=section&id=Consolidated%20Financial%20Statements) The consolidated financial statements detail AngioDynamics' FY2024 net sales of $303.9 million, a $184.3 million net loss, and a balance sheet with $317.7 million in total assets Consolidated Balance Sheets (in thousands) | (in thousands) | May 31, 2024 | May 31, 2023 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $76,056 | $44,620 | | Total current assets | $193,253 | $163,542 | | Goodwill | $0 | $159,238 | | **Total Assets** | **$317,671** | **$532,637** | | **Liabilities & Equity** | | | | Total current liabilities | $91,155 | $83,825 | | Long-term debt | $0 | $49,818 | | **Total Liabilities** | **$112,085** | **$154,341** | | **Total Stockholders' Equity** | **$205,586** | **$378,296** | Consolidated Statements of Operations (in thousands, except per share data) | (in thousands, except per share data) | FY 2024 | FY 2023 | FY 2022 | | :--- | :--- | :--- | :--- | | Net sales | $303,914 | $338,752 | $316,219 | | Gross profit | $154,698 | $174,246 | $165,732 | | Goodwill impairment | $159,476 | $14,549 | $0 | | Operating loss | ($192,435) | ($51,181) | ($28,471) | | Net loss | ($184,349) | ($52,442) | ($26,547) | | Diluted loss per share | ($4.59) | ($1.33) | ($0.68) |

Financial Data and Key Metrics Changes - Total pro forma worldwide revenue for Q4 FY 2024 was $71.1 million, representing a growth of approximately 2% year-over-year [7] - For the full fiscal year, revenue was $270.7 million, reflecting a growth of 5.3% [9] - Adjusted EBITDA for Q4 FY 2024 was $1.5 million, compared to $1.3 million in Q4 FY 2023 [35] - The company narrowed its adjusted loss per share to $0.05 in Q4 FY 2024 from $0.11 in the prior year [34] Business Line Data and Key Metrics Changes - Med Tech segment revenue grew 11% year-over-year in Q4 FY 2024, driven by Auryon and NanoKnife [7][27] - Med Device segment revenue declined approximately 4% in Q4 FY 2024, primarily due to reorganization impacts [8][31] - Auryon platform contributed $13 million in revenue during Q4, growing 12% compared to last year [28] - NanoKnife disposable revenue increased 18% year-over-year in Q4, with total NanoKnife sales up 30.5% for the full year [30] Market Data and Key Metrics Changes - Med Tech platforms comprised 41% of total revenue in Q4 FY 2024, up from 38% a year ago [27] - The total addressable market (TAM) for Med Tech has expanded from approximately $3 billion to roughly $10 billion since 2021 [10] Company Strategy and Development Direction - The company is focused on pursuing larger and faster-growing Med Tech markets, driving portfolio optimization, and deploying focused resource development [10][16] - The strategic transformation initiated in July 2021 has led to nearly doubling the revenue contribution from the Med Tech portfolio [18] - The transition to a fully outsourced manufacturing model is expected to generate approximately $15 million in annualized savings by fiscal 2027 [21] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth potential of the Med Tech business, particularly with upcoming product launches and FDA approvals [41] - The company anticipates revenue for FY 2025 to be in the range of $282 million to $288 million, representing growth of 4.2% to 6.4% [38] - Management highlighted the importance of maintaining a strong balance sheet to support growth initiatives [36] Other Important Information - The company achieved a settlement in a long-standing IP litigation dispute, providing clarity and enabling a focus on innovation [22] - Nearly all products have received updated EU MDR approval, positioning the company well for international expansion [23] Q&A Session Summary Question: Guidance for next year, especially regarding Med Tech growth - Management indicated that some growth from the prostate indication is included in the guidance, but does not expect a significant spike post-indication [45][46] Question: Stability of AngioVac and efforts to maintain it - Management noted that AngioVac's stability is due to its unique design and targeted sales force training [53] Question: Reimbursement efforts for NanoKnife - Management is actively working on reimbursement pathways and expects to achieve significant value from NanoKnife through these efforts [58][60] Question: Differences in commercial strategies between the U.S. and Europe for AlphaVac - Management stated that while the fundamentals are the same, the U.S. market has progressed faster, and extensive training is being provided to the European team [64]