Financial Data and Key Metrics Changes - Revenues for Q2 2025 were $7.3 million, down from $9.2 million in Q2 2024, primarily due to fewer capital system sales [18] - Gross profit decreased to $2.9 million in Q2 2025 from $5.4 million in Q2 2024, with gross margin dropping to 39.7% from 58.7% [19] - Net loss for Q2 2025 was $1 million, or $0.06 per share, compared to net income of $1.6 million, or $0.10 per diluted share, in Q2 2024 [20] - Adjusted EBITDA for Q2 2025 was negative $1.8 million, down from positive $2.1 million in the prior year [20] Business Line Data and Key Metrics Changes - The company delivered 19 SRT systems in Q2 2025, with four sold to China, indicating growing international demand [9] - FDA treatment volume increased by 27% over Q1 2025, suggesting improved efficiency and patient awareness of SRT [9] Market Data and Key Metrics Changes - The proposed local coverage determination (LCD) by Medicare has temporarily stalled domestic sales momentum, impacting market activity [5][6] - The proposed physician fee schedule by Medicare could significantly increase reimbursement for SRT delivery, potentially transforming the U.S. commercial strategy [16] Company Strategy and Development Direction - The company is focused on increasing patient awareness for SRT, growing internationally, and advancing its product pipeline [14] - A new partnership with Radiation Oncology Systems (ROS) aims to enhance distribution in hospital-based oncology segments [10] - The company is preparing for commercial deployment of its next-generation TBI platform, with FDA feedback anticipated later this year [11] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the potential for increased reimbursement rates and the positive impact on SRT adoption [23] - The company is actively lobbying against the proposed LCD, believing it will not be implemented due to their efforts and supporting evidence [30][36] - Management indicated that the pause in purchasing from a large customer is temporary and that interest in SRT remains strong [42][43] Other Important Information - The company ended the quarter with $22.2 million in cash and no debt, maintaining a strong balance sheet [23] - The MD SAP certification allows the company to access markets in Brazil, Canada, Japan, and Australia, enhancing its international growth prospects [15] Q&A Session Summary Question: Impact of proposed CMS reimbursement changes - Management clarified that the LCD and proposed physician fee schedule are separate, with the LCD focusing on ultrasound utilization [28][30] Question: Effects of LCD on FDA treatment volumes - Management noted a pause in market activity due to uncertainty from the LCD, but they believe ultrasound's role in SRT will be validated [34][35] Question: Status of large customer purchases - Management confirmed that the largest customer has paused purchases due to reimbursement uncertainties but remains committed to SRT [42][43] Question: Potential for increased sales in China - Management expressed optimism about continued orders from China and potential new orders from other international markets due to MD SAP [46][70] Question: Macro-level softness in capital equipment spending - Management indicated that the current pause is specific to SRT and not indicative of broader market trends, with expectations for growth in Q3 [72][73]

Financial Data and Key Metrics Changes - Revenue for Q1 2025 was $8.3 million, down from $10.7 million in Q1 2024, primarily due to lower unit sales to the largest customer [13] - Gross profit for Q1 2025 was $4.4 million, resulting in a gross margin of 52% [14] - The company reported a net loss of $2.6 million or a loss of $0.16 per share compared to net income of $2.3 million or $0.14 per diluted share in the prior year quarter [17] Business Line Data and Key Metrics Changes - The company shipped 21 SRT systems in Q1 2025, bringing the total installed base to over 880 systems [4] - There was a 65% increase in patient treatments from fair deal agreement installations when comparing Q1 volumes with Q4 [8] Market Data and Key Metrics Changes - The company expects to surpass 900 systems by the end of Q2 2025 and aims to reach 1,000 units under direct sale within the next twelve months [5] - The fair deal agreement program is anticipated to contribute significantly to revenue in the second half of 2025 [10] Company Strategy and Development Direction - The company is focusing on expanding its fair deal agreement program, which aligns financial interests with patient volume and practice utilization [9] - The international strategy is progressing, with participation in major industry events and targeted marketing activities [11] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about returning to profitability in each of the next three quarters and for the full year [5] - The company is strategically executing plans to build sustainable long-term growth through FDA installations and product innovation [12] Other Important Information - Operating expenses increased significantly due to strategic growth initiatives, with general and administrative expenses rising to $2.2 million from $1.6 million a year ago [15] - Research and development expenses increased to $2.6 million from $0.9 million in the prior year period, reflecting continued investment in product innovation [16] Q&A Session Summary Question: How does the first quarter of 2025 compare to the first quarter of 2024? - Management expects each subsequent quarter to be profitable, driven by revenues from fair deal agreements and product sales [22] Question: Did any part of the first quarter revenue come from the fair deal agreement? - Yes, but it was not large enough to make a significant impact [24][26] Question: Has the existing U.S. tariff policy affected business confidence? - So far, there have been no observed tariff repercussions on any of the businesses [27] Question: What is the anticipated volume once fair deal agreements are fully operational? - It typically takes four to five months from signing an agreement to initial revenue generation [31] Question: What is the current installed base and target goal by the end of 2025? - The company is not providing specific guidance on the target goal but is moving along aggressively [45] Question: What marketing support will be provided to clinics to help them reach mature utilization rates? - The company will provide analytics and aggressive marketing strategies to help clinics attract patients [46] Question: What is the expected timeline for receiving payments after treatments? - Payments are typically received between 45 and 60 days after treatments [55] Question: What is the profile of attendees at smaller conferences? - Smaller conferences attract practitioners who may not attend larger events, providing opportunities for FDA agreements [57] Question: How do the installations match up with patient databases? - The installations tend to match well with the patient data, enhancing confidence in the targeted areas for treatment [61]