Nano-X Imaging (NNOX) - 2022 Q2 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Nano-X generated top line revenue of $2.2 million in Q2 2022, compared to$1.8 million in Q1 2022, indicating a quarter-over-quarter growth [10] - The GAAP net loss for Q2 2022 was $19.6 million, compared to a net loss of$13.6 million in Q2 2021, largely due to acquisition-related expenses and increased R&D costs [25] - Non-GAAP net loss for Q2 2022 was $8.2 million, compared to a non-GAAP net loss of$8.6 million for the same period in 2021 [31] Business Line Data and Key Metrics Changes - Revenue from teleradiology services was $2.1 million with a gross profit of$0.0 million on a GAAP basis, and $0.9 million on a non-GAAP basis, representing a gross profit margin of approximately 43$0.1 million in revenue with a gross loss of 2.1 million on a GAAP basis [26] - The company signed 14 new client agreements for teleradiology services during Q2 2022, indicating accelerated revenue growth [12] Market Data and Key Metrics Changes - The company is preparing for global deployment of the Nanox.ARC system, with significant progress in Nigeria and Ghana [18][19] - A strategic agreement was signed with Spectrum Health, an integrated healthcare network in Michigan, to use the AI population health solution [14] Company Strategy and Development Direction - The company aims to advance the Nanox.ARC system towards commercialization and is focused on obtaining FDA clearance [8] - A technology development center is being established in Israel to enhance R&D capabilities, complementing existing facilities in Korea and Japan [22] - The company is pushing forward with the deployment of the Nanox.ARC in Nigeria and has signed an agreement to deploy 350 units in Ghana [19][20] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the progress made in the FDA clearance process and the potential for accelerated revenue growth from teleradiology services [15][12] - The management team acknowledged the challenges posed by supply chain issues but remains committed to advancing production and deployment timelines [42] Other Important Information - The company was added to the Russell 2000 and Russell 3000 indexes effective June 27, 2022, which is seen as a positive development [24] - Cash, cash equivalents, and marketable securities as of June 30, 2022, were approximately 126.7 million [33] Q&A Session Summary Question: Can you talk about the technology center in Israel and its capabilities? - The technology center will focus on advanced technologies and will complement existing facilities in Korea and Japan, which are more manufacturing-oriented [41] Question: What is the anticipated number of ARCs manufactured by the end of the year? - Production is being accelerated, with the first 1,000 units expected to be assembled in Israel, and further discussions on mass production are ongoing [42] Question: Will there be any goodwill impairment in Q3 or Q4? - Future goodwill impairment will depend on market parameters and internal management estimates [46] Question: What is the status of the CE Mark for Nanox.ARC? - All necessary documentation for CE marking has been submitted, and the company is hopeful for a timely process [57] Question: Can you provide an update on the AI agreements and their revenue potential? - The integration of AI solutions is ongoing, with revenue potential ranging from a few hundred thousand to several million dollars [66]