Nano X Imaging Ltd Aktie

Good day, and thank you for standing by. Welcome to the Nanox First Quarter 2021 Earnings Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Mike Cavanaugh, Investor Relations. Please go ahead.

Good morning, and welcome to the Nano-X Imaging First Quarter 2026 Investor Call. Earlier today, Nano-X Imaging Ltd. released financial results for the quarter ending March 31, 2026. The release is currently available on the Investors section of the company's website. With me today are Erez Meltzer, Chief Executive Officer and Acting Chairman.

Before we get started, I would like to remind everyone that management will be making statements during this call that include forward-looking statements regarding the company's financial results, research and development, manufacturing and commercialization activities regulatory process and clinical activities and other matters. These statements are subject to risks, uncertainties and assumptions that are based on management's current expectations as of today and may not be updated in the future. Therefore, these statements should not be relied upon as representing the company's views as of any subsequent date. Factors that may cause such a difference include, but are not limited to, those described in the company's filings with the Securities and Exchange Commission.

We will also refer to certain non-GAAP financial measures to provide additional information to investors. A reconciliation of the non-GAAP to GAAP measures is provided with our press release, with the primary differences being non-GAAP net loss attributable to ordinary shares, non-GAAP cost of revenue non-GAAP gross profit, non-GAAP gross profit margin, non-GAAP research and development expenses, non-GAAP sales and marketing expenses non-GAAP general and administrative expenses and non-GAAP gross loss per share. With that, I'd now like to turn the call over to Erez Meltzer.

Good morning, and thank you for joining us today for the Nano-X Imaging First Quarter 2026 Financial Results Conference Call.

I'm pleased to report that as previously indicated, we are beginning to see early signs of revenue from Nanox.ARC. We are seeing momentum across multiple fronts from record deployments to expanding partnerships, supporting our technology and business model. We have worked diligently over the past 2 years to place a new technology in the medical imaging market. This process takes significant time and effort. We have learned mainly lessons during this time and we are using those lessons learned to help reshape our go-to-market strategy.

Specifically, we have made various adaptations to our company strategy and operating model to better position us for long-term success.

Changing behaviors is a long process, and we need to educate customers not only on the medical utility of the Nanox systems but also demonstrate while using them will benefit their practices financially. Here are some of the changes we have implemented based on lessons learned.

First, we have restructured our U.S. commercial model to emphasize partnerships. This multichannel approach supplements our direct sales efforts and provides broader market coverage more efficiently. In the first quarter alone, we secured multiple commercial agreements in the U.S. with established medical equipment distributors who have existing relationship and credibilities in the market.

Second, we are prioritizing deployments of Nanox.ARC systems at high visibility reference sites like [ RadNet ], the largest outpatient imaging center operator in the United States, where it is now commercial use and integrated into routine clinical workflows.

Third, we created the Nanox imaging network to seek out business segments, which offer potentially higher reimbursement rates such as workers' compensation groups and concierge medical providers.

Fourth, we initiated a restructuring process designed to optimize our cost structure, improve capital efficiency, reduce burn rates and better align our operations with our long-term business objectives. I will share more details about all of these changes in my remarks today.

While shifting the standard of care in medical imaging is a long-term endeavor, we believe these adjustments will better align our resources and position us to capitalize on the substantial market opportunity of Nanox.ARC.

With that, let me share some of the accomplishments we have achieved since our last call. We are seeing the early signs that our multichannel model is beginning to work with deployments increasing, scan-based activity started to contribute to revenues increased scanned volume at active sites and partners beginning to generate pipeline and initial commercial activity and engage directly with customers to support sales and adoption.

The Nanox imaging network proof of concept is also beginning to contribute to our progress. As a reminder, this is a focused initiative targeting segments such as workers' compensation, concierge medicine and outpatient specialty care where positive reimbursement development may support higher [ first ] scan pricing.

We are exploring opportunities across three segments: a large integrated health care campus, an independent rehab and pain clinic and an orthopedic physicians practice. These engagements will support our strategy of driving adoption across enterprise specialty outpatient and physician-led settings.

Important, I'm very excited to share a strategic deployment. The [ Nanox RX ] system has been operational for several months at the [ RadNet ] sites. [ RadNet ] is the largest outpatient imaging center operator in the United States, and has deployed a Nanox.ARC system and one of its facilities where it is now in commercial use and integrated into routine clinical workflow. Based on this experience, we are exploring opportunities for expanded deployment across additional outpatient imaging centers and for clinical research, including early lung nodule detection. We believe this represents an important step in demonstrating the Nanox.ARC clinical value in a major outpatient imaging settings and we are excited to continue this collaboration.

I'd also like to talk about how we are working to get our growing commercial relationship activated. In the first quarter, we secured multiple commercial agreements in the U.S. with established medical equipment distributors that have a strong market presence, credibility and existing customer relationships. Collectively, these agreements represent the potential for approximately 360 CapEx system sales over the next 2 or 3 years.

During the second quarter, our primary focus was on onboarding these partners, training their teams, aligning go-to-market activities and building the operational foundations required to support commercialization. We are now beginning to see the early results of these efforts, including initial leads for the Nanox.ARC and engaging with their customers and driving early commercial opportunities.

That said, commercialization in medicine imaging takes time the transition from signed agreements to active sales installation and revenue recognition depends on various factors that may affect commercialization, including site readiness regulatory processes.

For example, some segments may involve additional regulatory and [ SOC 2 ] requirements.

We've also advanced partnerships in Latin America where we signed a distribution agreement with [ Topmed SAC ] in Peru late May. Additional agreements are in advanced stages of negotiation.

Importantly, these agreements are already contributing to a growing pipeline of potential system deployment and expanded deployment opportunities, generating new sales leads, which have resulted in new discussions with medical imaging providers. We expect to announce more partnerships soon, further existing our commercial reach and market penetration.

We believe these highly focused medical imaging partners will play a key role in accelerating the commercial adoption of Nanox.ARC and helping us reach an inflection point in the growth of our business.

Indeed, we are now leading the shift towards a more CapEx-driven commercial model, supported by our partner network and initial purchase activity. We believe this evolution can contribute to revenue growth while helping reduce future cash needs and enhance our path to breakeven.

And finally, let me also provide an update regarding our South Korean operations. As previously announced, we initiated a restructuring process designed to optimize our cost structure, improve capital efficiency and better align our operations with our long-term business objectives. We have now commenced the implementation of that restructuring plan.

At the same time, we are evaluating additional alternatives to further optimize the economics of our South Korea operation and maximize the value of the related assets.

These alternatives include a broader restructuring initiative that originally contemplated a potential sale of South Korea operations and related assets or an orderly wind down of all the parts of those operations. No decision has made at this stage and our evaluation remains ongoing. What is important is that we are taking a disciplined approach to capital allocation and operational efficiency and are evaluating all available options throughout the lens of a long-term shareholder value.

Looking ahead, we remain focused on three key priorities: continuing to scale our deployment numbers, converting our pipelines of direct sales and partnerships discussions into purchase order and signed agreements and supporting our partners to drive system sales and utilization. The foundations we have built positions us well for sustained growth throughout 2026 and beyond.

We believe we are at the beginning of transforming access to medical imaging globally and the progress we have made this quarter reinforce our confidence in the path ahead.

Turning to our AI business. I'd like to update you on the previously announced clinical trial partnership with [ Cedar-Sinai ] in Los Angeles. This strategic health system partnership continues to support our clinical validation efforts. Based on the retrospective pilot at [ Cedar-Sinai ], we created and return on investment calculator for the downstream economy of follow-ups for the patients that will be flagged by the AI cardio solution. This calculator shows that analyzing a random group of 5,000 cases we can expect almost 1,800 patients with the RC classification, out of which 49 will be categorized as severe cases. This is expected to generate $3.8 million in the first year from downstream follow-ups to the medical center.

More importantly, identify severe cases early supports earlier clinical intervention, which may help improve patient outcomes.

For another AI customer update, following a highly successful prospective pilot and supported by a paper presented at the World Congress on osteoporosis last month, the 259 General Air Force Hospital in Greece, has transitioned to a revenue-generating commercial deployment. We view this as the meaningful milestone achieved in advancing the commercial rollout of our AI solutions. Highlights from the paper demonstrates that the AI bone solution was significantly better at correctly flagging vertical fractures and estimated that utilizing the solution showed a 14-fold increase in identified fractures compared to radiologists with no solution and a nearly fivefold improvement in endocrinologists who utilize the solution to evaluate images.

Beyond expanding our AI capabilities, we have begun to realize some of our anticipated synergies and between Health IT, Nanox.AI, Nanox.ARC and U.S. [indiscernible]. As an example, we have recently completed integration and performed a customer demo utilizing non-algorithm with a health IT partner [ PacSystems ]. We have presented the Nanox.ARC to multiple health IT customers, and we have gained new business for both U.S. [indiscernible] from Health IT by partnering together on a new opportunity, and the flow of opportunities is also coming back to IT from its sister divisions. The pipeline of cross division led generation is growing by the week.

Regarding our new Health IT business, year-to-date, we've executed contracts with several new clients and received additional services add-on orders from existing clients. In terms of implementation, we have had customer solutions go live this year. This includes some sales made pre-acquisition that have since been implemented, and I want to confirm that we have begun to receive monthly recurring revenues from those accounts.

Next month, Nanox.AI will be featured at the [ SSCP ] Annual Scientific Meeting in San Diego, where Dr. Blast a member of our Advisory Board will present early results from our multisite AI-informed clinical trial. The data highlights two important points.

First, that AI-enabled opportunistic coronary calcium detection can help drive earlier preventive care; and second, that our cardiac solution, also known as Health CCS performs reliably across multiple U.S. clinical sites and real-world workflows.

Together, these studies built the case that AI-enabled opportunistic CAC detection is both clinically reliable and clinically meaningful.

I'd like to share a few additional updates on our OEM relationship and pursuits. Varex tubes are undergoing the final integration process to become our main X-ray tube source for the [ Nanox RX ] systems. Regarding the Oak Ridge National Laboratory prototypes, tube assembly has begun, and we anticipate testing completion and delivery in early Q3. We have initiated Nanox technology assessments with multiple global industry leaders in the security and inspection fields and we'll update as soon as appropriate.

Overall, interest in the Nanox chip source technology remains quite strong. And as stated, we are in various stages of development, fabrication, testing and technology assessment on multiple fronts.

Before I hand the call over to our financials, I would like to address our previously issued 2026 revenue targets. Since providing this target earlier this year, we have continued to advance our commercialization efforts across the business and have made meaningful progress across a number of commercial, operational and strategic initiatives.

At the same time, we have experienced longer-than-anticipated time lines between the execution of commercial agreements, system deployment, activations, commencement of services and the related recognition of revenue.

As we have gained additional experience across multiple markets and customer deployments, we have seen the timing of revenue generation and revenue recognition can vary significantly and is influenced by a number of factors that are often outside of our control, including site readiness, infrastructure, completion, customer implementation schedules activation timing, utilization ramp-up and third-party execution.

While we remain encouraged by the customer interest, commercial activity and market adoption, these factors can materially affect the timing at which revenue is recognized in a particular reporting period. As a result, we no longer expect to achieve the revenue target previously announced for 2026.

Importantly, what we are seeing is not a reduction in our confidence in the market opportunity, customer demand or the value proposition of our solutions. We continue to expand our installed base, advanced customer implementation and execute against commercial agreements that contemplate the deployment of hundreds of systems over the coming years.

We also continue to grow and advance our businesses across imaging, AI, teleradiology, OEM and health IT. Based on our experience to date, the variability associated with deployment time lines, implementation schedule and the revenue recognition, we have concluded that the annual revenue guidance is not currently the most effective way to evaluate the progress of our business.

Accordingly, we do not currently intend to provide annual revenue guidance going forward. Instead, we intend to focus investors on the operational, commercial and strategic milestones that we believe are more meaningful indications of our progress, including deployments, activations, utilization growth, customer adoption, service expansion and execution against our commercial agreements.

We remain highly confident in the long-term opportunity across our imaging, AI, teleradiology, OEM and health IT businesses. We believe the progress we have made to date positions us well for long-term growth, and we remain focused on disciplined execution and building long-term shareholder value.

With Nanox getting closer to an operational inflection point, let me step back and remind the challenges that we set out to address and vision behind it.

Our vision is to expand access to medical imaging and support a shift toward more preventive health care. Today, imaging remains constrained by cost, complexity and infrastructure, which limits access across many care settings.

To address this, we developed our proprietary digital x-ray technology, which enabled the cloud connected and AI compatible Nanox.ARC systems and support broader deployment and simpler operation across a range of clinical environments.

With development behind us, our focus is now on execution converting pipelines into deployments activating sites and integrating systems into routine clinical use throughout our direct efforts and partner network.

To better support our growth, we have recently taken steps to streamline the organization and align our cost structure with this stage while remaining fully focused on commercialization.

Going forward, progress will be driven by continued deployments, site activity and expansion throughout our partnerships.

Taking together the progress we have made to date across deployment partnerships and operational alignment is beginning to translate into a more visible and developing commercial trajectory.

Before we begin the financial review, I'd like to note that as previously announced, our CFO, Ran Daniel is in the process of transitioning out of his role. As far as this transition, [ Guy Nathan ] on will be joining the company and is working alongside the team to ensure a smooth handover. Today, financial review will be presented by me and [ Guy ] is with me here today.

Revenue for the reported period was $4.3 million compared to revenue of $2.8 million in the comparable period. All figures refer to the quarter ended March 31, 2026, and all comparable figures refer to the comparable quarter of 2025, unless otherwise stated. The increase largely stems for an increase of $0.9 million due to the consolidation of [ Aso ] Healthcare IT, now Nanox Health IT and an increase of $0.5 million in our revenue from our teleradiology services.

Gross loss for the reported period was $2.6 million on a GAAP basis compared to a gross loss of $3 million non-GAAP gross loss for the reported period was $0.2 million as compared to a gross loss of $0.4 million.

Revenue from teleradiology services for the reported period was $3.1 million compared to revenue of $2.6 million. The company's GAAP gross profit from teleradiology services for the reported period was $0.7 million gross profit margin of approximately 24% compared to $0.4 million, gross profit margin of approximately 17%.

Non-GAAP gross profit of the company's teleradiology services was $1.1 million, gross profit margin of approximately 36% and compared to a gross profit of $1 million, gross profit margin of approximately 39%. The increase in the revenue was mainly attributed to our customer retention and increased volume of the company reading services.

During the reported period, the company generated revenues to the sales and deployment of its imaging systems, which amounted to $1,067 compared to revenue of $3,000. The revenue stems for the sales and deployment of to now's [ Connex ] units in the amount of $1,018 deployment of its imaging systems in the amount of $11,000 and the revenue due to our OEM services in the amount of $38,000.

The company revenues from its AI and software solutions for the reported period was $1 million compared to revenue of $0.2 million revenue of $0.9 million was generated in the reporting period by Nanox Health IT.

The company gross loss from its AI and software solutions for the reported period was $1.7 million on a GAAP basis compared to a gross loss of $1.9 million. Non-GAAP gross profit to the company's AI and software solutions for the reported period was $0.3 million compared to $81,000.

Research and development expenses net for the reported period were $4.8 million compared to $5 million. Sales and marketing expenses for the reported period were $2.2 million compared to $0.9 million, mainly due to an increase of $0.8 million in salaries and wages and $0.3 million in sales and marketing activities.

General and administrative expenses for the reported period was $5.2 million compared to $5.1 million. GAAP net loss of the reported period was $14.3 million compared with a net loss of $13.2 million, the increase of $1.1 million was largely due to the increase of $0.9 million in operating expenses.

Non-GAAP net loss attributable to the ordinary shares for the reported period was $11.1 million compared to $9.4 million mainly due to an increase of $1.4 million in the non-GAAP operating expenses. Please refer to the non-GAAP adjustments which were included in the financial portion of the PR that we have issued to date.

Turning to our balance sheet. As of March 31, 2026, the company had total cash and cash equivalents, short-term deposits long-term restricted deposits of $44.2 million compared to $60 million as of December 31, 2025. over the reported period, the company experienced negative cash flow from operations of $14 million and an additional $1.8 million on a purchasing property and equipment, mainly for the building of [ ARCX ].

Management expects that the company's cash and cash equivalent and net deposits as of 31st of March 2026 are not sufficient to support the company operations under its current operating plans for at least 1 year, from the date of the press release. These factors raise substantial doubt as to the company ability to continue on an ongoing concern.

On a preliminary annual [indiscernible] basis, the company estimates that its cash and cash equivalent net of short-term bank loan to be approximately $27 million as of the date of the press release, management in continuing in the process of seeking to raise funds in the private equity and capital markets as the company will need to finance its operations.

However, there is no assurance that the company will be able to obtain such funding to the extent additional funding is provided by the sales of security for the insurance -- the issuance incurrence of the indeptable -- indebtedness ordinary shareholder ownership, interest may be diluted and the terms of the financing may adversely affect rights of ordinary shareholders, imposed restrictive covenants on the company and result in an increased fixed payment obligations.

In order to finance our operations, we may also raise funds through collaborations, strategic partnerships or marketing, distributing distribution of our licensing arrangement with the third parties, which may require us to relinquish valuable rights to our technologies, future revenue streams, research programs or products or grant license on terms that may not be favorable for us.

In addition, the company is exploring the use of mitigation actions such as [ spostolic ] expenses that are not based on firm commitment. If we're unable to raise additional funds, when needed, we may be required to delay reduce or eliminate our product development or future commercialization efforts or grand track to develop market products that we would otherwise prefer to develop market by ourselves. The consolidated financial statements do not include any adjustments that may necessary should the company be unable to continue as a core concern.

We ended the quarter with property and equipment net of $30.6 million compared to as of December 31, 2025. The increase was mainly attributable to purchase of property and equipment in the amount of $1.8 million during the reported period. We had approximately 69.6 million shares outstanding as of March 31, 2026 and December 31, 2025, respectively.

During the first quarter of 2026, the company granted officers, employees and consultants of the company a total of approximately 1 million RSUs.

And to the concluding remarks. While commercialization has not gone as rapidly as had planned 2 years ago, we remain confident in the ultimate success of the comprehensive suite of Nanox Rx solutions.

Looking ahead, we remain focused on three key priorities: continuing to scale our deployment numbers, converting our pipeline of partnership discussions into signed agreement and supporting our partners to drive system sales and utilization.

The foundations we have built in the beginning to result in growing deployments and positions us well for continued progress through 2026. We remain focused on the execution and believe we are building the right framework to support sustained commercialization over time. We believe we are at the beginning of expanding access to medical imaging and the progress we have made this quarter reinforces our confidence in the path ahead.

Thank you for joining our call today. And as always, we appreciate your continued support. Operator, please open the call to questions.

[Operator Instructions] Our first question comes from the line of Jeffrey Cohen with Ladenburg Thalmann & Company.

So two from my end. Firstly, could you talk about the teleradiology business? And you did call out customer retention, increased rates and increased volumes. Could you kind of drill into that a little bit for our benefit as far as rates go and number of customers and volumes and utilization?

I heard the teleradiology and what's the second question, Jeff?

Could you talk about the rates and the customers and volumes and utilization?

Of the teleradiology?

Yes, please.

So as you can see, since the acquisition of U.S. [ Arad ], we have managed to more than double the sales the revenues that comes from the teleradiology. This is mainly due to increase of the number of customers. Right now, it's a few hundred customers. Of course, they vary from one to another. One can do like a few hundred thousand dollars and the other can do a few thousand dollars. And what we are trying to do is also change the mix to the benefit of high-priced readings such as MRI and CP on the expense of X-ray.

Now of course, we don't choose what the customer is scanning so we have to do -- we do it all, but I would say that 1 of the trends that we see that we see a lot of increase in the scans of the MRI and the CT according to me. And this is one of the trends that impacted the increase in revenues. We saw the increase year-over-year, and we'll probably see hopefully an increase. We monitor it on a weekly basis and even the number of scans that are being read are higher than last year.

The one thing that I would say is that I mentioned about the cross-selling between Nanox units. So on one hand, U.S. [ Arad ], the teleradiology business gave us a lot of opportunities to sell the ARC and new customers to sell the AI and new customers to sell the Nanox [indiscernible] IP. But on the other hand, every ARC that we deploy and the -- it's a new system that before they didn't have X-ray or CT they ask us to provide the services in addition to the scans of the paper scan, they ask us to provide the reading services. So teleradiology are adding to, I would say, they are reading a meaningful part of the scans that the ARC is scanning, and I think you will see a growth in this one as well.

And then secondly, Erez a follow-up. Can you talk about the cadence of deployments for the balance of the year? I know you did call out units at various stages of which some will come online in the back half. What should we expect for ARC units coming online for second quarter and the balance of the year?

I will talk on the balance of the year. We mentioned that right now we have in the business partners. This is, of course, in addition to the direct sales that our salespeople are doing. We mentioned that we have currently 360 units that we sign agreements in the next 2, 3 years.

I think that we mentioned that the [ Howard ] estimate their part for 60 this year. And this is in addition to all the other efforts, which are being done to find more business partners that we mentioned. This is only in the U.S.

In the rest of the world, we mentioned that Greece is coming up. Romania is coming up, Peru is coming up, Argentina is coming up. Czech we sold already. In France, we have a system already. So there are many of them and more countries are -- right now, we are planning to do.

The most important element, and I think that for those of you who have listened carefully to my script today, [ RadNet ] is an interesting one. The system is there for quite some time. As you all know, [ RadNet ] is the largest imaging -- medical imaging chain in the U.S., probably one of the biggest in the world. and the system that was tested commercially by the way, and clinically in the last -- during the 2026 and even a bit before, was successfully implemented. And the plan right now is indicated previously to expand this collaboration to more systems across the sites of [ RadNet ].

Last but not least, we mentioned that right now, we are planning once again, everything depends on the -- on regulation, on approvals, on permits, on site preparation, et cetera, but we are planning to install 21 sites of the Nanox Imaging network, which, by the way, out of which one site, which is a retail is already scanning. And two, as of yesterday, two sites, the system arrived to the site. And as soon as they complete the preparations, it will start scanning.

Our next question comes from the line of Scott Henry with AGP.

A couple of questions. First, a little bit of a follow-up, but how should we think about 2Q? There's only a couple of days left in the quarter. So we should have a pretty good sense at this point.

Sequentially, should we expect Q2 to be stronger than Q1. I'm not looking for specifics, but just curious your thoughts, obviously, given that It's June 25.

Yes. I think that probably we'll be ready with these numbers shortly. And as soon as they are already, we're going to share them.

Okay. Fair enough. And then spending levels, how should -- I mean it sounds like you're going to rationalize some of the cost. Should we expect spending as far as total operating expenses to start to decline sequentially? Just wanted to get a thought on how we should think about that in the rest of the year.

The answer is yes. First of all, the outcome of the reduction in the Korean operation and the fact that we are doing all the efforts in order to save. We cut some costs in other places. We have reduced the headcount in -- mainly in Israel by 15 employees and cut the scope of employment of others. So based on early indication that we have for June, we can expect a reduction in the burn rate.

Okay. Great. Final question on the AI business. Certainly, the numbers getting notably higher. At what level would we expect that business to be breakeven as far as gross profit. Should we think about that as a 2027 event or a late '26? Just want to get an idea how to model that.

Yes. So initially, we have indicated in the past that probably at the tail or the end of 2026, we are going to be cash neutral or breakeven or -- but I would say that it may be pushed to by quarter or so. So I would say early 2027, probably. Based on the...

No, for clarity, I was just -- I was asking about the gross profit for the AI division. Should that -- as you reach $2 million a quarter, would that be breakeven for -- as far as gross profit, not spending, just I'm just trying to model that out.

Okay. The -- so the answer is a bit easier. From a gross profit since the gross profit of the AI and IT is very high. I would say in the probably in the '80s. So the answer is probably earlier than what you have asked for.

Our next question comes from the line of Sarah James with Cantor Fitzgerald.

This is Gabby on for Sarah. I can appreciate removing the revenue guidance in terms of visibility. But could you help us if you view the first quarter as sort of run rate once I back out the consolidation of Nanox, Health IT. And just kind of any sort of framing on how you expect -- what a more realistic 2026 revenue target is?

I'm not sure I understand the question. Can you elaborate or...

Yes. So with the removal of the $35 million revenue guidance, as I think about the rest of the year, can I think about the first quarter 2026 as sort of a run rate for the rest of the year? Do you expect revenue to ramp? Just anything that helps us with the full year.

So first of all, the fact that we have removed guidance as saying that anything that we're not going to work hard in order to be there where we want it to be. but I think that it probably may be pushed.

I think that I've indicated in my remarks that we are planning to ramp up from Q3 and for because in Q1, following the RSNA, we signed most of the agreements with the business partners, okay? We have indicated that we have another few of them another a few of them that are coming soon as well as other as well as the other countries in rest of the world, Europe and Latin America.

And Q2, which is currently where we are right now. The was mainly focused on the onboarding of the people, training the salespeople getting the list of 10, many tens of customers that we have already engaged in meetings with business partners. So our channel managers and the business partners are going to these customers and meeting them. And I would say that Q3 will probably be the implementation.

And I'm currently showing no further questions at this time. Erez, would you like to provide any further remarks?

Yes. Maybe I would say that we expect that Q2 will be better than Q1, whether it's much or more or a little, this will be shared probably in the very near future. And I would end with what I said earlier, we are really confident that we are taking the right steps. Yes, it's step by step. And -- but the way that we operate, the way that we put a framework for the success and for the scale is something that will enable us to justify the confidence in our ability to transform and become what we want to be and what our mission is.

Thank you. This does conclude today's conference. Thank you for participating. You may now disconnect.

Ladies and gentlemen, thank you for standing by. Welcome to the Nano-X Fourth Quarter 2025 Earnings Call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would like now to turn the conference over to Mike Cavanaugh, Investor Relations. Please go ahead.

Good morning, and welcome to the Nano-X Imaging Fourth Quarter 2025 Investor Call. Earlier today, Nano-X Imaging Ltd. released financial results for the quarter ending December 31, 2025. The release is currently available on the Investors section of the company's website.

With me today are Erez Meltzer, Chief Executive Officer and acting Chairman; and Ran Daniel, Chief Financial Officer. Before we get started, I would like to remind everyone that management will be making statements during this call that include forward-looking statements regarding the company's financial results, research and development, manufacturing and commercialization activities, regulatory process and clinical activities, among other matters. These statements are subject to risks, uncertainties and assumptions that are based on management's current expectations as of today and may not be updated in the future.

Therefore, these statements should not be relied upon as representing the company's views as of any subsequent date. Factors that may cause such a difference include, but are not limited to, those described in the company's filings with the Securities and Exchange Commission. We will also refer to certain non-GAAP financial measures to provide additional information to investors. A reconciliation of the non-GAAP to GAAP measures is provided with our press release with the primary differences being non-GAAP net loss attributable to ordinary shares, non-GAAP cost of revenue, non-GAAP gross profit, non-GAAP gross profit margin, non-GAAP research and development expenses, non-GAAP sales and marketing expenses, non-GAAP general and administrative expenses and non-GAAP gross loss per share.

With that, I'd now like to turn the call over to Erez Meltzer.

Thank you, Mike, and thank you all for joining us today. In the fourth quarter of 2025, we continued to move the business forward across multiple fronts. While our primary focus remains on expanding our commercial presence, given the current geopolitical situation, we spent a lot of effort during the quarter and the beginning of 2026 to secure our supply chain and strengthen our financial positions as well.

On top of that, we made good progress advancing the capabilities of Nano platform and strengthening the operational infrastructure needed to support our long-term growth. I'm happy to report that we recently entered into an agreement with Howard Technology Solutions, a division of powered industries, which has a national reach and an established presence in health care and public sector market, providing us with a scalable framework for expanding Nanox.ARC deployments.

This agreement reflects our confidence in the commercial demand for the Nanox.ARC and our ability to engage partners that can support sustained growth in system placements across the U.S. Other the framework of this agreement, [ Howard ] is expected to deploy 300 Nanox.ARC systems over a 3 years period, of which 60 are indicated to be deployed in the first year. We also recently announced multiple commercial agreement, which together accumulates to roughly 360 [ systems ] over a 2 to 3 years' period. These partnerships expand our reach across imaging centers and specialty care setting where point-of-care imaging is integral to clinical workflow and patient management.

This represents a fundamental shift in how we are [ poised ] to scale our business from providing our technology to the [ play ] and a meaningful volume shifting toward a growing CapEx portion. This is what we see and getting us closer to our indicated revenue of 2026. The framework has the potential to become a meaningful contributor over time [ and ] just confidence in our ability to convert our robust pipeline into revenue as we move forward. We view this and continue momentum and see ourselves moving closer to an inflection point.

We observed a clear shift in the market perception at major radiology conferences, including RSNA in the U.S. and ECR in Europe, where engagement and inbound interest increased meaningfully. We've also taken important steps to strengthen our operational foundation, a key component of this initiative is the restructuring of cert activities in our Korean manufacturing facility in order to reduce our Korean operation OpEx and cash burn and improve efficiency while maintaining our supply of Nanox.ARC system component.

We are very pleased with the progress we have made recently, but it is clear that the pace of deployment continues to be influenced by various external processes, including import licenses, construction time line, and regulatory [ required ] in certain markets. These steps take time to complete. And while we are not setting try with a pace and would like to deployments more faster, this reflects the current operating reality across multiple markets. We expect that many of these processes will streamline as additional sites moved through to the pipeline.

Introducing new technology of any time into a medical environment is always complex process. It requires alignment across clinical workflow, regulatory framework, and operational infrastructure as well as changing behaviors which all takes time to achieve it. While this can slow down the early stages of deployment, it is also a natural part of introducing innovative technology into the health care systems.

Turning to revenues. We continue to target $35 million in revenue for the full year of 2026 based on the execution of our current plans. Today, as part of the [ above ] mentioned, we have signed a commercial agreement, which we believe could result in present and future placements of [ Tabat400 ] systems globally over the next 2, 3 years, of this, approximately 38 systems are currently adverse stages of deployment, including administration, commercial installation and system spending construction and/or regulatory approval.

In addition, there are approximately 15 systems that are expected to be installed over the next few months and start of our non imaging network. That said, it is important to emphasize that our current revenue base remain at an early stage and part of this deployed base is not generating revenue and the pace of [ rent ] prop will depend primarily on the timing of system activation, their transition into a revenue-generating operation and the impact of the deployment by the business partners. As more systems move into operation and utilization increases, we expect revenue to book accordingly. However, the exact timing of this trend may very and always depending on the deployment process and progress and our factors.

I will now provide some bit color on the Korea restructuring that I referenced in my opening remarks. Recently, we adopted a restructuring plan designed to better align our manufacturing cost structure with our long-term financial model, support our path toward improved gross margin and align our manufacturing capabilities with the company's strategic priorities. As part of this plan and our broader cost reduction efforts, we are closing our chip manufacturing line in South Korea, downsizing our fabrication facilities and shifting production to established international manufacturing partners including system, a Switzerland-based manufacturing partner.

We currently hold substantial emitter inventory, which we plan to work through as we had transitioned to a more efficient outsourced production model better aligned with current and projected demand. With these actions, we expect to reduce structural and overhead costs, low [ our ] cash burn and enhanced overall operation efficiency.

With that overview, let's now take a detailed look at our various business segments, starting with the U.S. deployment. Beyond the hardware agreement, we also recently announced a distribution agreement with Imperial Imaging Technology, a U.S.-based provider of diagnostic imaging solution to support rollout across the Southeast, particularly in [ optic ] focused environment where there is strong demand for a point-of-care imaging.

In addition, we signed agreements with distributors such as integrity imaging, a U.S.-based provider of medical imaging solution with established relationships across hedging centers, health care providers. Elite Surgical, which serves surgical and specialty care environments, digital X-ray imaging a leading diagnostic imaging provider with deep reginal presence across [ Arcosa ]. And most recently, a collaboration with [ New ] an imaging solution provider focused on expanding access to diagnostic imaging and radiology oncology system to support all to support the deployment of Nanox.ARC systems.

These collaborations aim to strengthen our distribution capability by adding sales resources and on the ground presence expands our geographic coverage, and we believe it is the potential to become a meaningful contributor to revenues per time. In parallel, we remain active discussion with additional partners reflecting continued interest from medical equipment providers and likely further expansion of our U.S. pipeline. Alongside our channel strategy, our U.S. direct sales team on the ground continues to make progress in targeted clinical segments.

For example, we recently signed an agreement with regional sports medicine in [ Auto ] Group, our first orthopedic practice customer in the United States. This represents an important step into a segment where imaging plays a central role in diagnostic and treatment decisions and where providers benefit from having imaging available on site. Orthopedics remain a high volume and imaging-driven specialty with a strong incentives to retain imaging in-house.

Additionally, we are advancing the [ Nano ] imaging network. A focused initiative designed to build a network-based imaging services model in [ the ]. This initiative target segment, such as the workers' compensation and specialized care for reimbursement dynamics may support higher per scan pricing. We are currently deploying already systems across a number of sites in the U.S.

Under this model, Nano-X supports Nanox.ARC system deployment, maintenance and connectivity, while our partners manage tight operation and local engagement. While still in the very early stage, we believe this initiative can become an important component of our long-term commercial strategy as the utilization increases and the model is further validated. To provide additional context around this shift in engagement, we participated in two major industry events during the period.

At RSNA, the world's largest annual radiology conference held in the U.S., our booth featuring live demonstration of the Nanox.ARC system saw strong interest throughout the event. At the European Congress of Radiology, ECR, the largest radiology conference in Europe, we showcase the Nanox.ARC [ in ] Europe for the first time and presented new clinical and AI data. Engagement levels were high, reflecting growing awareness of the system's clinical value and its potential role in routine imaging world. We were also proud to receive the [ redock ] awards from product design to [ 2 ]6 for the Nano-X [ ARC ] prestigious international recognition that reflects the maturity usability and clinical readiness of our platform.

Let's now turn to work outside of the U.S. As I mentioned earlier regarding ECR, we were also honored to receive the newcomer award at ECR 2026 reflecting the growing recognition of Nanox will in the European radiology community. In February, Nano-X announced an exclusive distribution agreement with [ Inter ] a leading medical distributor in Argentina with more than 35 years of experience. Under this agreement, INTECH will oversee marketing, distribution installation and support for the Nanox.ARC system and related services across the country.

The collaboration intended to support commercial expansion of Nano-X 3D digital tomosynthesis technology in Argentina and strengthened the company's presence in Latin America, leveraging [ Imec's ] established relationship with the health care providers and nationwide service capabilities. Commercialization will be subject to obtaining the required regulatory approval. In Latin America, we were expected for a significant presentation at the International Congress of Radiology, the ICR in Cartagena, Colombia. The presentation will support clinical discussion around digital tomosynthesis and contribute to engagement with regional clinicians and industry stakeholders.

In Europe, we continue to build momentum through partners and additional regional distributors. As a reminder, over the past few quarters, we have announced multiple European collaborations, including France, Romania, Czech Republic, Serbia alongside additional engagement in other European markets. These collaborations support our ability to navigate local regulatory environment and advanced commercialization across multiple countries.

Switching gears, we continue to advance dilatory work that supports our commercial initiatives by expanding the use cases for our solution and making them accessible in more markets. We have advanced key milestones, including TAP2D clearance in the United States. As a reminder, TAP2D is the 2D new image output for the Nanox.ARC system, a practical tool for a geologist to enhance their diagnostic confidence as they become more experienced evaluating digital tomosynthesis images in part of our broader vision to alleviate agentive use limitation over time.

We also updated the AMR approval for Nanox.ARC in Israel based on our existing CE Mark enabling use of the system without object limitation. Removal of the agent [ usliitation ] in the U.S. remain a key regulatory priority. We believe this is an important step that can expand our addressable market and support broader adoption. We are also working to finalize our CMR submission for the Nanox.ARC in Europe, which is currently anticipated in 2026, subject to change based on regulatory priorities.

Turning to our AI business. We continue to strengthen our position as a comprehensive platform for the interpretation of medical images. I'm happy to report that Cedars-Sinai Medical Center in Los Angeles is joining a trial studying the benefit of Nanox.AI aortic valve classification measurement solution, which is currently under development. We have recently conducted an on-site revaluation of the model across approximately 600 retrospective cases. The result exceeded our expectations with six cases over severe classification identified in approximately 100 cases showing clinical relevant findings.

The Cedars-Sinai team has also expressed interest in collaboration on scientific publications based on these results. We are very pleased to be partnering with Cedars-Sinai, one of the nation's premier medical institutions. Overall, we are seeing growth in Nanox.AI business driven by new customers, expansion of existing agreements and the integration of Nano-X Health IT.

During the quarter, we completed the strategic acquisition of [ Vaso ] HealthCare IT, now Nano-X Health IT, a health care IT provider serving hospitals and health care systems across the United States with expertise in health care IT implementation. Since completing the acquisition, we have been progressing with integration and alignment while also signing several new customer agreements. We are seeing growth driven by new customers, expansion of existing agreements and the integration of our health IT capabilities and we expect this business to contribute to revenue from day 1.

In addition to increasing our footprint in AI, the Health IT platform, enhance our ability to integrate into clinical workflow, expand customer cases [ and ] support cross engagement across our ecosystems. Moreover, the rest of the organization is leveraging the [ LIP ] team's expertise and market presence, particularly as it pertains to lead generation for the U.S. [ Iron ] Nanox.AI and Nanox.ARC. Similar to our regulatory work, clinical validation remains central to our strategy and support our commercial efforts to generating evidence across multiple applications and supporting the use of Nano-X solution.

As already mentioned, the Cedars-Sinai Medical Center is joining a trial of Nanox.AI Arc [ clarification ] measurement solution, and we've accomplished much more recently. In an exciting update from our collaboration with MDS wellness, an independent provider of wellness screening programs located in Michigan, we secured our first Institutional Review Board approval for a clinical trial within the U.S. The trial will focus on line cancer screening of high-risk patients and the applicability of Nanox.ARC technology as it relates to patient population of Nano-X MPS.

As I stated earlier, we attended the European Conference of Radiology, the ECR, where we were able to present several scientific achievements and I'd like to share some highlights now. Dr. [ Nova Shashin ], ARC's Chief Medical Officer, presented our scientific work on lung cancer screening using the Nanox.ARC in the work with our operations in what was shown that is the majority of patients, the screening outcomes based on the lung [ rug ] category, the standard lung cancer premicalification system was similar when analyzing the CT and digital tomosynthesis.

This further strengthens the applicability of the TS as a potential addition to screening activities ramping up globally. Dr. [ At ] Wind firmer, senior medical and clinical adviser presented the proven value of our opportunistic screening for CT image using Nanox.AI and three FDA-cleared algorithm enabling earlier detection of chronic disease.

Our latest imaging, in addition, tomosynthesis augmented projection, known as TAP2D was also featured in several scientific posters showing value of TAP2D image and a supplemental image to DTS in lieu of the traditional two extra imaging with no additional dose or acquisition inflicted on the patient. And in addition, at the recently concluded World conference of osteoporosis, Nanox.AI bone solution were featured, including updates from our ADAPT trial conducted across four NHS Trust and led by the University of Oxford as well as initial observation from our collaboration with the Greek Air Force.

The data will show once more the clinical and economic benefits of AI-based opportunistic screening for routine city exempts. The validation abstract comparing the accuracy of the CCS 2.2 compared with cardiology expert reader as part of the [ InFO ] trial was expected as the poster at the Society of Cardiovascular Complete Thermotography Annual Scientific Meeting in the coming July. Outside the U.S., we are excited about our recent collaboration with their Medical Center in Israel, which is part of the [ Clalit ] Israel largest health services organization where we have an exciting relationship.

The Nanox.ARC has been deployed in the emergency department and will be utilized by orthopedic staff as part of the clinical workflow to help establish the digital tomography as an effective tool with lower dose and more efficient workflow than today's CT-based workflow. This is the first time that Nanox.ARC is installed within an emergency department in a major hospital and represent the confidence our collaboration has a Nano-X solution.

I'll now provide an update on our robust OEM relationship. Nano-X continued to advance its technology pipeline with ongoing development of next-generation field demand X-ray sources and tube architecture. Recent progress includes improvement in [ telemeter ] design and fabrication processes aimed to expanding chip lifetime and enhancing performance, development of micro focus and multi-zone emitter configuration for application stated semiconductor inspection and held and continued advancement of the Nano-X MDX, the multisource two [ platform ] enabling new system architecture for 3D imaging.

The company is also progressing a multiple OEM collaboration in pilot projects across industrial, semiconductor and security market, supporting the expansion of Nano-X's technology into new applications. We recently received a purchase order from the leading semiconductor equipment manufacturer for the developmental meters, supporting advance inspection applications at the leading edge of next-generation IT technologies. With [ Obi ] National Laboratories, the U.S. government agency, a second round of product life is currently in progress, and in process with preparations underway as required materials become available.

In parallel, one global imaging component supplier has agreed to evaluate our micro-focused meter technology and is [ caring ] dedicated test infrastructure to support that work. Another major OEM continues to advance prototype development based on our meter design with validation activities are going.

Overall, these engagements reflect continued momentum across multiple development track as we work to validate our technology with established industry partners. Before I move on I'd like to briefly note that despite the current geopolitical situation in the Middle East, we have not experienced any material disruption to our operation and our business continues to operate event.

With that, I will turn the call over to Ran to review our financials. Ran, over to you.

Thank you. We reported a GAAP net loss for the fourth quarter of 2025 of $33.4 million, which is the reported period. Compared with a net loss of $14.1 million in the fourth quarter of 2024, which is the comparable period. The increase was largely due to an impairment of long-lived assets in the amount of $17.5 million which was recorded during the reported period as a result of the company's restructuring plan that is intended to better align the company's manufacturing activities.

The increase was also due to an increase of $0.7 million in the gross loss increase of $1.1 million in the sales and marketing expenses and increase of $1.4 million in other expenses. Revenue for the reported period was $3.7 million compared to revenue $3.0 million in the comparable period. The increase of $0.7 million increase of 23% in the revenues stands from an increase of $0.3 million in our revenue from the teleradiology services and an increase of $0.4 million in our revenue due to the consolidations of Nano-X Health IT Inc. since the completion of its acquisition on November 19, 2025.

Gross loss for the quarter period was $3.6 million on a GAAP basis compared to a gross loss of $2.9 million in the comparable period on a GAAP basis. Non-GAAP gross loss for the reported period was $1.2 million as compared to a gross loss of $0.3 million in the comparable period which represents a gross loss margin of approximately 32% on a non-GAAP basis for the reported period as compared to a gross loss margin of 9% on a non-GAAP basis in the comparable period.

Revenue from the teleradiology services for the reported period was $3.1 million compared to revenue of $2.8 million in the comparable period. The company's got to gross profit from the teleradiology services for the reported period was $0.9 million. Gross profit margins of approximately 27% compared to $0.6 million gross profit margin of approximately 21% in the comparable period.

Non-GAAP gross profit of the company's teleradiology services for the reported period was $1.5 million gross profit margins of approximately 48% compared to a non-GAAP gross profit of $1.1 million, gross profit margin of approximately 41% in the comparable period. The increase in the company's revenue and gross profit from the teleradiology services was mainly attributable to customer retention, increased rates and increased volume of the company's reading services.

During the reported period, the company generated revenue for the sales and deployment of its imaging systems, which amounted $49,000 for the reported period with a gross loss of $2.6 million on a GAAP and non-GAAP basis compared to revenue of $136,000 with a gross loss of $1.5 million on a GAAP and non-GAAP basis in the comparable period. The revenue stems from the deployment of our Nanox.ARC systems and the sales of our OEM services in the U.S. The company's revenue from its AI and software solutions for the reported period was $0.5 million on a GAAP and non-GAAP basis compared to revenue of $0.1 million on a GAAP and non-GAAP basis in the comparable period.

Included in the reported period revenue of $0.4 million, which was generated by Nano-X Health IT Inc. since the completion of its acquisitions on November 19, 2025. The company's gross law for its AI and software solutions for the reported period was $1.9 million on a GAAP basis compared to a gross loss of $2.0 million on a GAAP basis in the comparable period. Non-GAAP gross profit of the company's AI and software solutions for the reported period was $0.1 million compared to $6,000 in the comparable period.

Research and development expenses net for the reported period were $4.8 million compared to $5.4 million in the comparable period, which represents a decrease of $0.6 million. The decrease was mainly due to a decrease of $0.2 million in share-based compensation, $0.6 million in grants received net and $0.4 million in expenses related to our research and development activities to maintain our current and future products. The decrease was mitigated by an increase of $0.5 million in salaries and wages.

Sales and marketing expenses for the reported period are $2.0 million compared to $0.9 million in the comparable period, which represents an increase of $1.1 million, mainly due to an increase of $0.7 million in salaries and wages due to our increased efforts to commercialization of the commercialization of our products in the U.S. market and $0.4 million in sales and marketing activities mainly due to expenses that are related to the RSNA conference, which took place during the fourth quarter of 2025.

General and administrative expenses for the reported period was $6.0 million compared to $5.8 million in the comparable period, that the increase of $0.2 million was mainly due to expenses that are related to the acquisitions of Nano-X Health IT Inc. Other expenses net for the reported period were $1.4 million, largely due to the noncash settlement with the shareholder. Recently, we initiated a restructuring plan that is intended to better align our refracturing and overhead cost structure and to support gross profit margin improvement to the company's long-term financial model and the company's strategic priorities.

As part of this restructuring plan, the company will shift its manufacturing operations from the company-owned facilities into a fully outsourced model. The plan will reduce structuring and overhead cost by downsizing the restructuring facilities located in the company's fab in South Korea to offer the production to other international manufacturers such as the Swiss chip maker System. The restructuring plan is expected to be largely completed in fiscal year 2026 resulted with the company recording a noncash impairment of long-lived assets of approximately $17.5 billion in fiscal year of 2025, a cost that is related to the impairment of its machinery and equipment of the company's cheap manufacturing line.

We continue to evaluate the overall composition of the restructuring-related charges, including potential additional cash components. The remaining restructuring-related costs if any, are expected to be incurred over the course of the implementation of the restructuring plan that estimates of the total charges and the timing thereof are subject to a number of assumptions and uncertainties and actual results may differ materially. Non-GAAP net loss attributable to ordinary shares for the reported period was $11.2 million compared to $10 million in the comparable period.

The increase of $1.2 million in the non-GAAP net loss attributable to ordinary shares was mainly due to an increase of $0.9 million in the non-GAAP gross loss and an increase of $1.4 million in the non-GAAP operating expenses. Please refer to the non-GAAP adjustments, which were included in the financial portion of the PR that we have issued today.

Turning to our balance sheet. As of December 31, 2025, we had cash, cash equivalents and marketable securities of approximately $60 million compared to $55 5 million as of September 30, 2025. We also had a $3.1 million short-term loan from a bank as of December 31, 2025. We ended the quarter with a property and equipment net of $29.7 million compared to $45.4 million as of December 31, 2024. The decrease was mainly attributable to an impairment of approximately $17.5 million that was recorded in the reported period as a result of the above-mentioned impairment related to the machinery and equipment of the company's Korean fab.

We had approximately 69.6 million and 63.8 million shares outstanding as of December 31, 2025 and December 2024, respectively. During the fourth quarter of 2025, the company sold approximately 4.2 million ordinary shares, which generated net proceeds of approximately $15.5 million, net of issuance expenses.

With that, I will hand the call back over to Erez.

Thank you, Ran. Before closing, I'd like to address the leadership update. After 5 years with the company, our great Chief Financial Officer, Ran Daniel, decided to step down from his role to explore other opportunities.

During his tenure, Ran played an important role in strengthening our financial discipline, supporting our transition to a public company in building the financial and reporting infrastructure needed to support our long-term strategy. We also led successful capital raises that strengthened our balance sheet. In addition to leading our finance organization, Ran also oversaw our Investor Relations activity and worked closely with investors and analysts throughout his tenure. We are grateful for his many contributions and wishing continued success in the future endeavors.

One will remain with the company to support a smooth transition period. As we look ahead, we are pleased to announce that Guy Nathanzon will be joining Nano-X as Chief Financial Officer. Guy brings extensive financial leadership experience with the U.S. publicly traded companies including several senior CFO and CEO roles in the med tech companies as well as his deep experience supporting growth, scale and global operations.

His background includes capital raising, capital markets, both sell-side and buy-side M&A and global financial operations. Guy also brings deep medical technology leadership experience with senior CFO and COO at multiple medtech companies during periods of commercialization, [ CALA ] and global expansion. Guy also brings medical technology experience, having served interior leadership role during periods of commercialization and expansion.

His previous [ Lee ] served as the CFO Scorpio Labs Medical Technology company developing AI-based diagnostic platform and most recently was CFO of Valent Semiconductor and New York Stock Exchange listed company. We are pleased to welcome Guy to the leadership. He will join the company and will assume the role of Chief Financial Officer as of August 1. As we look back to this quarter, and ahead to the rest of 2026, I want to leave you with a few takeaways that underscore the momentum we are [ holding ] at Nano-X.

First, our commercial progress in the United States has been good. We have established a strong foundation with various partners expected to place systems over the next 2 to 3 years including significant agreements with our industry's internal imaging integrity, imaging and others. This represents a fundamental shift in how we are poised to scale our business from providing our technology to deploying in a meaningful volume shifting towards a growing CapEx portion, this is what we believe will get us closer to our [ India ] revenues of 2026.

Second, our strategic acquisition of [ Veda ] Healthcare IT, now operating as Nano-X Health IT has immediately strengthen our capabilities and revenue base. The recognition we received at RSNA and ER including the newcomer awards at ACR reflect the broader truth. Nano-X recognize as a credible player contributing to conversation around the future standard of care in the medical imaging. That perception shift in translating into deeper market engagement and robust supply. The foundation we have built positions us well to convert our pipeline into revenues and deliver on our growth objectives.

We are excited about what lies ahead and remain committed to executing on our vision of demarketizing medical imaging globally. Thank you all for your continued support, and we look forward to updating you on our progress in the quarters ahead.

Operators, please open the call for questions.

[Operator Instructions] And the first question comes from Jeffrey Cohen with Ladenburg Waman & Company.

Just a couple of questions to [ diving ] a little further. So could you talk a little bit about your footprint and commercial organization, mainly related in the U.S. as far as teams that are direct sales organizations and talk a little bit about how that works with your distribution channels in the U.S.

Okay. So we have in the U.S., what we call Nano-X impact. We have five direct salespeople with the director of the national sales that is coming from our biggest distributors in the country with a lot of experience.

In addition, we have which we call the clinical education specialists where their role and assignment is to go to the places that we have the systems installed, trade the [ people ], trying to get a better understanding of the referring physician who works with this site. So their job is to build awareness around the site and what's the clinical value that can be added or other referring physicians that we'll do there.

We are -- we have a few organization and operational responsibilities, including tech people who are doing the part of the installations. And in addition, we are -- we have people who are doing the STR like building the deal flow. We are in the process of adding another two people who would be responsible for the channel management. But right now, since we have almost 10 business partners, one of them has mentioned today, is huge. This will require a lot of coordination, a lot of support. We have an onboarding processes for each one of them, which is very methodological that we do in the process to -- when we sign an agreement, the trading process, the unit, for example, we have a few of the business partners in the [ late ] time. We have tens of [ billings ] that already were arranged with the potential customers in order to expand into from field where they are [ committed ] to in the agreement.

Okay. Got it. And then as a follow-up, could you talk a little bit about the South Korean facility and the impairment, what should we expect for 2026, you anticipate further restructuring and impairment? And will that be in the front half year versus the back half of the year? And could you estimate for us if there will be cash and noncash?

Besides the impairment expenses we recorded in 2025, which was the impairment of mainly whatever is related to the chip line in [ the ] fab which was amounted to $17.5 million in the noncash expense, we do anticipate relatively minor expenses which are related to more efficiency that we're going to enact. It won't be -- we don't anticipate that will be a significant amount of dollar. So that's actually going probably to be a cash expense. But as I said, it's not going to be material.

Bear in mind that this fab was built during COVID when semiconductors were not necessarily available. So right now, we are rationalizing the situation where we have a sustainable supplier with a much lower cost of being chips that we do. The Southern Korea go, we converted to more of R&D center for the ceramic teams that we are developing there and might be even another product which is going to come out from this region.

[Operator Instructions] And our next question will come from Scott Henry with AGP.

Thank you, and good morning or afternoon, depending on your location. First, Ran, it was a pleasure working with you. I wish you the best in your future endeavors.

But don't give me. I have another one earnings call.

Excellent. And then, I guess, the first question. When we look at the guidance for 2026, the $35 million which is strong growth. Can you talk about the cadence throughout the year, Q1 is over. So when will we see that inflection point to reach those impressive number?

I think that you will see most of the -- in the second half -- towards the second half of 2026, I don't think that they should expect a big ramp in the revenue in Q1. But I think once we will be able to materialize all the opportunities in terms of distribution agreements that we just announced, you will see. You may see a ramp-up in the second half of 2026.

Scott, most of the agreements were signed beginning of about a month or 2 after the RSNA and part of them also after the ECR. And most of them -- most of the business partners agreements, which are going to shift our revenues to be more coming from more from CapEx rather than only the stuff has been signed in the last few weeks, let's say, a month. So right now, we say we will do -- we will start the onboarding the process and the ramp-up will be, hopefully, its financial towards, as Ran said, towards the second part of the year.

Okay. I appreciate that color. And just from a modeling perspective, the teleradiology services, which at this point is still your largest revenue driver. For 2026, should we be thinking about kind of low double-digit growth? Is it still on that trajectory?

I don't think that we refer to the [indiscernible] in our guidance. So I don't want to make any specific attribution to any specific line of visits or segments. But [ general ] saying I think that your assumption not far from real [indiscernible] from real.

And then when we look at spending for Q4 removing the onetime items, it was a little elevated from Q3 with the restructuring, do you -- would you think that it should start declining from Q4 levels going forward? How should we think about those trends in spending?

Well, what happened in the -- you mean, if you look at the non-GAAP, of course, which adds on the impairment expenses and the expense -- the other expenses, that's mainly related to the settlement with the shareholder, you've seen an increase in G&A, which is, I would call it a seasonal increase mainly because of audit and all kind of other year-end items and expenses that were related to the acquisition of [ Base ] Healthcare, which is onetime in nature.

On the other hand, you also see an increase in the sales and marketing, which are -- some of it is related to the [ ization ] oil efforts in the U.S. market. So that's actually something that is not onetime item in nature, but on the other, and if we will participate again in our S&A conference that -- that really depends on the questions. We participate in the RSNA in the [ out ] quarter, as you remember, that cost money, unfortunately. But if we participate against then it will be recurring if we won't, we won't.

Thank you. And this does conclude today's conference call. Thank you for your participation, and you may now disconnect.

Good morning, and welcome to the Nanox Imaging Third Quarter 2025 Investor Call. Earlier today, Nanox Imaging Limited released financial results for the quarter ending September 30, 2025. The release is currently available on the Investors section of the company's website.

With me today are Erez Meltzer, Chief Executive Officer and Acting Chairman; and Ran Daniel, Chief Financial Officer.

Before we get started, I would like to remind everyone that management will be making statements during this call that include forward-looking statements regarding the company's financial results, research and development, manufacturing and commercialization activities, regulatory process and clinical activities and other matters.

These statements are subject to risks, uncertainties and assumptions that are based on management's current expectations as of today and may not be updated in the future. Therefore, these statements should not be relied upon as representing the company's views as of any subsequent date. Factors that may cause such a difference include, but are not limited to, those described in the company's filings with the Securities and Exchange Commission.

We will also refer to certain non-GAAP financial measures to provide additional information to investors. A reconciliation of the non-GAAP to GAAP measures is provided with our press release with the primary differences being non-GAAP net loss attributable to ordinary shares, non-GAAP cost of revenue, non-GAAP gross profit, non-GAAP gross profit margin, non-GAAP research and development expenses, non-GAAP sales and marketing expenses, non-GAAP general and administrative expenses and non-GAAP gross loss per share.

With that, I'd now like to turn the call over to Erez Meltzer.

Good morning, everyone, and thank you for joining Nanox's Third Quarter 2025 Earnings Call. While many companies talk about global expansion, Nanox is delivering on it. It is important for us to share not only where we stand today, but also the path we are shaping for 2026 as we work to fulfill our mission and strengthen Nanox as a leading company in the medical imaging industry.

We are building a comprehensive medical imaging portfolio focused on increasing revenues and accelerating our path to profitability. Our strategy includes reinforcing our position in the medical AI sector, deepening our foothold in the U.S. health care system and driving meaningful change in the standard of care for medical imaging.

We are entering into our second execution phase, we plan to further expand the ARC deployment and pipeline, grow our AI presence through the acquisition of [ Vaso ] Healthcare IT that is being contemplated and explore further opportunities in imaging equipment with potential acquisitions and collaborations. While not every element is fully within our control, we believe it is the right time to share our growth road map. For 2026, we are guiding for more than $35 million in revenues.

Coming back to 2025, the third quarter brought progress across the organization, including our technology expansion, market scaling, AI infrastructure and operational efficiency. Today, I'm excited to share with you the progress we are making across our strategic three pillars where we are demonstrating real momentum in moving from innovation to commercial scale with measurable results.

Our first pillar focuses on technology expansion and market scaling, where we see momentum in our commercial deployment efforts. Nanox.ARC is now entering a growth phase in the retail imaging segment, expanding access to advanced imaging and community and outpatient settings where patients need it most. We recently signed two new agreements in the Czech Republic and in France that represents an important milestone in Nanox European strategy and follows recent distribution agreement in Greece, Romania, demonstrating the rising demand for Nanox imaging ecosystem and strengthening its presence across Europe.

We are progressing toward our goal of deploying 100 systems worldwide in various stages for clinical demo and commercial purposes by the end of 2025. A number of systems are pending final regulatory approval and site preparations. As we scale our current ARC deployment, we are simultaneously working on unlock even greater market potential through the regulatory advancement. In the U.S., we continue to work with the FDA to remove the adjunctive use limitation, which will allow us to market the Nanox.ARC as a stand-alone modality.

Building on both our deployment momentum and anticipated regulatory progress, we are preparing to launch our next-generation platform that will further accelerate market penetration.

The new Nanox.ARC X system, which is to be unveiled at the RSNA Annual Meeting in less than 2 weeks, will extend our commercial reach even further with its smaller footprint and simplified installation process. Importantly, it has the flexibility to support additional clinical indication in the future. This enhanced platform is designed specifically to meet the diverse needs of our growing customer base and expand our addressable market significantly.

I'd like to highlight another example of how we are working to expand the market for Nanox.ARC. The Nanox.ARC X is AI-ready, which means it is compatible with future AI solution that are currently under development to interpret the ARC images. Ultimately, the clinical output will be an AI enhanced 3D digital tomosynthesis series with annotated pulmonary nodules, which may be an innovative new tool in the arsenal of lung cancer detection.

Our second pillar, AI infrastructure and integration represent the technological heart of our strategy, connecting all the pieces of our ecosystem and driving new revenue opportunities. Artificial intelligence is part of our core value proposition, transforming us from a hardware company into a comprehensive imaging platform.

In a key move to advance our AI business, we recently reached an agreement to acquire [ Vaso Healthcare IT ] or [ VHCIT ], a wholly owned subsidiary of Vaso Corporation, which provides best-of-breed health care IT solutions from various technology partners

Nanox and [ VHCIT ] together create a powerful synergy that connects Nanox.AI's FDA-cleared imaging AI solution with [ VHCIT's ] deep expertise in IT integration, implementation and customers' operations. This will potentially help us deliver improved customer service to our growing U.S. customer base.

This acquisition will align with our ongoing progress on multiple fronts as we expand our network and collaborations with prominent organizations such as [ Cedar Sinai ], 3DR, Covera Health and others. More details are included in my remarks below.

Now for an update on our third strategic pillar, which focus on operational efficiency and sustainable growth. We are building a leaner, more focused organization to support long-term success. Our workers' compensation and retail imaging initiatives continue to grow, creating scan-based revenue opportunities that strengthens our financial foundation.

Additionally, we are strengthening our production capabilities, through our partnership with [ Fabrinet ] preparing to manufacture hundreds of systems. And in parallel, we continue to enhance our tube manufacturing infrastructure as well. Nanox remained dedicated to accelerating and development of a highly efficient manufacturing operation.

Let's now review the progress we made during the quarter in our U.S. deployment progress, which demonstrates the strong commercial traction we are building across multiple channels. Currently, we have a growing number of ARC systems actively scanning showing consistent utilization and clinical adoption. One of the most active sites is an imaging center in California.

During the third quarter, achieved above average scanning levels, and the feedback from them has been very positive. Our installation plan provides us with a solid foundation for revenue generation and market presence. Another example is our recent collaboration with [ Kaiser ] University, where the Nanox.ARC has been integrated into their radiological technology graduate program, this flagship training and demonstration is already actively scanning giving future imaging professionals hands-on experience with Nanox.ARC early in their careers.

The full engagement of our business partners and the upcoming retail infrastructure reinforces our confidence in the next year guidance. I also want to let you know that Nanox will have a strong presence at the Radiology Society of North America or in short RSNA Annual Meeting, which begins on November 30 in Chicago. There, we will provide more detailed insights into our commercial progress and future strategy. We welcome you to visit our booth if you are attending the event.

In a recently announced partnership, we entered into a distribution agreement with X-ray, a leading Czech distributor of medical imaging system to introduce Nanox advanced imaging solution to health care providers across the Czech Republic. Under the terms of this agreement, X-ray will lead the market introduction sale and service of Nanox Medical Imaging solution than Nanox.ARC, founded in [ 2,13 ] X-ray is recognized as the #1 supplier of digital radiography system in the Czech Republic with installations in more than half of the country's 200 health care facilities and nationwide sales and service coverage. Additionally, this week, we signed a distribution agreement in France with [ Altea ] France SARL, part of Altea Group, one of Europe's largest independent providers of managed medical technology services.

As part of the agreement, [ Altea ] France will lead the introduction distribution installation and service of Nanox Medical Imaging Solution, the Nanox.ARC, across France's public and private health care sector. We have stated before that our initial for into the many European countries will be best served by commercial partnerships such as this. And rest assured, we are working on others. These partnerships are just some of the steps we took in the third quarter to better position us to scale globally and redefine the standard of care through innovation that makes imaging more accessible and efficient.

As we scale our current deployments, we are simultaneously working to unlock even greater market potential through regulatory advancements. In the U.S., the company has submitted the [ Tap 2D ] software module to the FDA through the 510(k) program. That today is a 2D view image output for the Nanox.ARC systems, a practical tool for our geologists to enhance their diagnostic confidence as they become more experienced evaluating digital tomosynthesis images. [ TAP 2D1 ] cleared will be part of a wider vision held by Nanox to alleviate adjunctive use limitation in the future. For perspective, adjunctive use limitation do not apply for the CE mark Nanox.ARC in the European market. This remains one of our top priorities, and we believe that removing the adjunctive use limitation will be a critical milestone that may unlock significant new market opportunities for the Nanox.ARC platform. This regulatory advancement represents a potential key catalyst for accelerated adoption across health care system.

Outside of the U.S., our regulatory efforts continue. But it is worth nothing that these efforts will not be streamlined as those in the U.S., where FDA clearances allow distribution in the entire country. The rest of the world by nature, is very fragmented, and we are working with many different countries, which have their own processes and relations.

In some instances, regulatory progress is slower than we would like. Nevertheless, we have not stopped pushing ahead with our regulatory efforts, which continue to be of paramount important to Nanox.

Now I'd like to discuss some of the extensive clinical work we are undertaking that supports all of our commercial efforts by generating robust data supporting the use of our solution across multiple clinical applications.

I'm happy to report that [ Cedar Sinai ]Medical Center is joining a trial of Nanox.AI for a new AI model for [indiscernible] classification measurement solution that is under development. The solution is intended to quantify the level of [ artic cells ] calcium, which is an important measure of freezed for [ arctic cell ] disease. We are very pleased to be partnering with [ Cedars-Sinai ], one of the nation's premier medical institutions.

We also have begun a collaboration with [ NDS ] wellness an independent provider of wellness screening programs located in Michigan, with whom we are engaging clinical trials to further assess the clinical value of Nanox.ARC in the context of lung cancer detection management and screening.

Last month, we attended the early lung cancer action programs, the [ ECL IP ] 40th Conference in New York focused on lung cancer screening and early detection. Among several presentations about the advantages of digital tomosynthesis in the lung cancer screening, [ Dr. Laurence Tennenbaum ] delivered and inspiring talk about how he believes that Nanox.ARC can be utilized in lung cancer screening and disease management protocols.

Outside the U.S., we are excited about recent collaboration with [ OLAP ] imagery, which is a group of independent radiologists through practice at several sites in [indiscernible] France, utilizing high-performance technical facilities. Through this collaboration, the Nanox RF system has been deployed at [ Opital Trive Jacques-Cartier at Masi ], one of the leading private hospital groups in Paris metropolitan area for a clinical trial design to further assess the value of the Nanox.ARC in supporting lung cancer detection, management and screening. This collaboration advanced our clinical valuation effort, in the second large [indiscernible] is intended data derived from this trial is intended to demonstrate the ARC's potential to improve patient outcomes through early screening for lung cancer which is the deadest cancer worldwide.

We continue to engage with research partners globally to execute a comprehensive clinical evidence generation strategy. I mentioned we will have a large presence at RSNA this year, and I encourage you to visit our booth. All details regarding our participation were published last week.

As I mentioned in my opening remarks, we are acquiring [ Vaso Healthcare IT ], or [ VHCIT ], a wholly owned subsidiary of [ Vaso ] Corporation, which provides best-of-breed health care IT solution from various technology partners, specifically imaging information technology solutions, which support imaging workflow for providers. Nanox and [ VHCIT ] together, create a powerful synergy that connect Nanox.ARC FDA clear imaging AI solutions with VHCIT's deep expertise in IT integration, implementation and customer operations.

Under the terms of the proposed transaction, Nanox will acquire VHCIT for a total consideration of up to $800,000 and consisting of is $200,000 cash payment at closing and up to $600,000 in performance-based earn-out payments over a period of up to 2 years, contingent upon revenue retention targets with respect to existing customers. This transaction is intended to accelerate deployment of Nanox.AI solution across U.S. health care facilities and is expected to be executed and completed within a couple of weeks.

Given the rapidly evolving nature of medical imaging technology, it is a challenge to keep up with these changes and informatics and [ Vaso Healthcare ] IT serves as a trusted adviser to address and solve these issues. We expect this partnership to accelerate the commercialization of Nanox.AI solutions and help generate scalable, recurring revenues.

Key synergies include cross-leveraging our organizational shared expertise, active accounts, sales funnels and product offerings. We believe this acquisition immediately expands the value we deliver to customers and shareholders.

We recently entered a commercial partnership with 3DR labs, one of the largest and most trusted providers of 3D medical imaging post processing services in the U.S. 3DR Labs offers Nanox.AI FDA clear imaging solution to its network of more than 1,800 hospitals and imaging centers across the U.S. The partnership enables 3DR labs to market and distribute Nanox.AI software solution to its client-based network of more than 1,800 hospitals an imaging center as the U.S. The agreement positions Nanox.AI technology to support initiatives to drive early disease detection and improving clinical outcomes at scale across the United States.

We are also expanding direct to clinician access to Nanox.AI solutions and launching new AI application that have the potential to improve diagnostic accuracy, early detection and patient management. I'm happy to report that we have closed our first deal under this new direct-to-clinician business model. This approach enables AI at the clinic level, equipping clinicians with value-added tools on-site and eliminating the needs to send patients to other locations for CT scans. I'm particularly excited about our current lineup of advanced AI solution that analyzed routine medical CT scans for any clinical indications to help identify patients with asymptotic or undetected findings correlated with chronic conditions in cardiac, liver and [indiscernible] promoting preventive care management where AI assist clinicians in generating numerical indications for further decision support. We are in the process of developing more innovations to add our offering and I look forward to announcing new AI developments as they become available.

In other AI-related news, we have successfully expanded our existing agreement with Covera Health. This new agreement builds upon our initial collaboration, which focus on rest prospective analysis to identify care gaps and support their platform. Our expanded agreement now includes prospective use cases such as opportunistic streaming for improved care outcomes.

We've also expanded our AI footprint to India, having recently signed a distribution agreement with an Indian commercial partner, and we're already running two pilots projects with several more in the pipeline.

A key element of the third pillar in the creation of sustainable and efficient supply chain to ensure we can meet anticipated future demand. With that in mind, we continue to engage with third-party manufacturers and suppliers for the commercial production of our digital X-ray tubes and other components for the use in the Nanox.ARC based on, among other things, cost effectiveness, et cetera. We are currently developing glass-based digital X-ray tubes for use in the Nanox.ARC, as previously disclosed, we are working with the third parties such as [ CI ] and [ Varex ] to build tubes and system, a cheap maker located in Switzerland, floral chips.

Our work with our manufacturing partners is a key component of the third pillar of future success. We will continue close collaboration with our technology suppliers to secure the supply of components needed as our ARC deployment continues.

As of today's call, we have fabricated enough meters and begun scaling due production to support the initial launch of our next-generation [ ARC ]. Specifically, to [ Varex ], we are well underway with performing all the necessary cube and art level testing to add them as an approved supplier early next year. We have additionally taken received from them of multiple [ MBX ] multi-source demonstration to advance our testing and development of stationary digital tomosynthesis and stationary CT type solution. [ Varex's MBX ] or multi-beam X-ray combines the precision of traditional X-ray with a detailed insight of CT imaging and enable faster, higher quality scans with reduced radiation exposure, offering clearer images and better patient outcome. Large personnel will visit our lab in Israel soon to support these efforts.

We are also working in partnership with Novel imaging technology company to explore utilization of our meter with their specialty detectors. These efforts to were low-dose single exposure dual energy capabilities significantly and hence, visualization for medical, security and inspection applications.

On the OEM business development front, in response to requests from the security materials analyst analysis and high-resolution inspection market, we are in the process of fabricating several novel immature layouts each with unique functionality to specifically address pain points or add requested capability as compared to their current offering.

We have also recently delivered two of our developer kits. One is the leading U.S. academic institute for medical solution development for medical application development and another to one of the largest global providers of industrial X-ray NPT inspection to recess developing their next-generation system.

Regarding our project with [ Oak-ridge ] National Laboratory, we are now working towards material acquisition and fabrication of the second-generation prototype to be utilized in their novel and compact mobile X-ray technology development.

As previously reported, we have entered into a multiyear volume supply agreement with [ Fabrinet ], a leading global electronics manufacturing services provider to support the scalable manufacturing of Nanox.ARC system. We believe this collaboration will drive down our manufacturing cost over time, which will in turn to support our mission to expand access to innovative affordable imaging technology worldwide.

Looking ahead, Nanox is dedicated to accelerating the development of a highly efficient and scalable manufacturing infrastructure. We will always be looking for ways to extract more efficiencies and may include future strategic collaborations. As we look ahead, we would like to provide our investors with some financial guidance for the coming year. Given our current business trajectory, sales funnel, new partnership and the [ Vaso ] acquisition, we expect to generate a name of $35 million in revenue in 2026.

Furthermore, we project the AI business segment with the addition of [ VHCIT ] will achieve EBITDA breakeven on a quarterly basis sometimes in 2026. We expect Nanox as a whole to reach EBITDA breakeven on a quarterly basis in 2027. These projections reflect our beliefs in an achievable path to sustainable profitability driven by our expanding commercial deployments and recurring revenue streams. We are executing a clear and consistent strategy across all three pillars moving forward with the confidence while systematically expanding our market presence and strengthening our foundation for long-term success. With that, I would like to hand the call to Ran Daniel for a review of our financials. Ran, over to you.

Thank you, Erez. We reported a GAAP net loss for the first quarter of 2025 or $13.7 million, which is the reported period compared with a net loss of $13.6 million in the third quarter of 2024, which is the comparable period. Revenue for the reported period was $3.4 million and gross loss was $2.9 million on a GAAP basis. Revenue for the comparable period was $3.0 million and gross growth was $2.8 million on a GAAP basis. The increase of $0.4 million in the revenue sales from an increase of in our revenue from our teleradiology services a decrease of $0.3 million in our revenue from our AI solutions and an increase of $0.1 million in our revenue from the sales and deployment of imaging systems and OEM services. .

Non-GAAP gross loss for the reported period was $0.3 million as compared to a gross loss of $0.2 million in the comparable period which represents a gross loss margin of approximately 8% on a non-GAAP basis for the reported period as compared to a gross loss margin of 6% on an non-GAAP basis in the comparable period.

Revenue from the teleradiology services for the reported period was $3.1 million with a gross profit of $0.2 million on a GAAP basis as compared to revenue of $2.6 million with a gross profit of $0.3 million on a GAAP basis in the comparable period which represented gross profit margins of approximately 25% on a GAAP basis for the reported period as compared to 13% on a GAAP basis in the comparable period.

Non-GAAP gross profit of the company's teleradiology services for the reported period was $1.3 million as compared to $0.9 million in the comparable period, which represents gross profit margins of approximately 43% on a non-GAAP basis for the reported period as compared to 35% on a non-GAAP basis in the comparable period.

The increase in the company's revenue and gross profit margins from the teleradiology services was mainly attributable to customer retention, increased rates and increased volume of the company's reading services during the weekends and weekdays.

During the reported period, the company generated revenue through the sale and deployment of imaging systems and OEM services, which amounted to $175,000 for the reported period, with a gross loss of $1.7 million on a GAAP basis and a non-GAAP basis compared to a revenue of $29,000 with a gross loss of $1.5 million on a GAAP basis and a non-GAAP basis in the comparable period.

The company's revenue from its AI solution for the reported period was $0.1 million. With a gross loss of $1.9 million on a GAAP basis compared to revenue of $0.4 million with a gross loss of $1.6 million in the comparable period. Non-GAAP gross profit of the company's AI solution for the reported period was $75,000 compared to a gross profit of $370,000 in the comparable period.

Research and development expenses net for the reported period were $4.6 million compared to $4.7 million in the comparable period, which represents a decrease of $0.1 million. The decrease was mainly due to a decrease of $0.4 million in share-based compensation and $0.5 million in expenses related to our development activities which were mitigated by an increase of $0.5 million in salaries and wages and a decrease of $0.3 million in grant received.

Sales and marketing expenses for the reported period were $1.5 million compared to $0.9 million in the comparable period, which represents an increase of $0.6 million mainly due to an increase of $0.5 million in salaries and wages, $0.5 million in marketing activities with connection to the commercialization in the U.S. market, which mitigated by a decrease of $0.1 million in share-based compensation.

General and administrative expenses for the reported period were $5.3 million compared to $5.7 million in the comparable period. The decrease of $0.4 million was mainly due to a decrease of $0.6 million in share-based compensation, a decrease of $0.2 million in the company's legal expenses and a decrease of $0.2 million in D&O insurance expenses, which were mitigated by an increase of $0.5 million in salaries and wages and recruiting fees.

Non-GAAP net loss attributable to ordinary shares for the reported period was $9.9 million compared to $8.7 million in the comparable period, an increase of $1.2 million in the non-GAAP net worth attributable to ordinary shares was mainly due to an increase of $0.1 million in the non-GAAP gross loans, an increase of $1.1 million in the non-GAAP operating expenses.

Turning to our balance sheet. As of September 30, 2025, we had cash, cash equivalents and marketable securities of approximately $55.5 million and add 3.2 million short-term loans from a bank. We ended the quarter with the property and equipment net of $46.7 million.

As of September 30, 2025 and December 31, 2024, with approximately 65.4 million and 63.8 million shares outstanding, respectively. With that, I will hand the call back over to Erez.

Thank you, Ran. The third quarter of 2025 was transformative for Nanox as we evolved from a hardware company into a comprehensive imaging platform. With our acquisition of [ Vaso ] Healthcare IT, new partnerships with 3DR labs, Altea and X-ray and the upcoming launch of our AI-ready ARC system at RSNA, we are building the infrastructure for sustainable recurring revenue streams that will define our future growth.

Together, we have our recent collaboration in Greece, Romania, the Czech Republic and France, we are strengthening our European footprint. And in parallel, our collaborations with [ Cedar Sinai ] and our ongoing clinical trials in France continue to advance the clinical validation of our technology and contribute to the global momentum behind our platform.

Through our three strategic pillars, we are executing a comprehensive commercial strategy that combined innovative technology with a robust clinical evidence generation and systematic market deployment. For those some elements being beyond our dire control, we believe this is the right moment to present our growth road map. And for 2026, we are guiding to revenues of $35 million.

Our purpose remains unchanged, to redefine medical imaging by uniting innovation intelligence and accessibility, creating meaningful impact for patients, clinicians and health care system worldwide. The momentum we are building across our commercial deployments and clinical evidence generation positions us well for continued growth and market leadership. Thank you for your continued support. Operator, please open the call for questions.

Operator, just before the question. Erez, one comment regarding the -- what actually was said that last night, we have actually closed the [ Vaso ] Healthcare IT acquisition, so actually it's done. With that, you can go ahead and open for the Q&A. .

[Operator Instructions] Now first question coming from the line of Ross Osborn with Cantor Fitzgerald.

Congrats on the progress. So starting with the quarter, would you walk through how many systems were in the field and performing scans that resulted in your revenue of $175,000?

Seasons out of all the together. A few of them are being installed as we speak, and a few will be installed in the next few weeks. And as mentioned, we are counting on the expansion of the retail expansion of the business partners, expansion of the salespeople that are closing deals right now. We have a few, as mentioned, some of them are waiting for regulatory approvals for physics approval for site preparation. But altogether, this has been [indiscernible].

Okay. Yes. Sorry, if I wasn't clear. Looking back during the 3Q, so you reported revenue, how did you generate $175,000, not for the rest of this year, but during the quarter?

It was a combination of revenue from Scans and our OEM services. I assume we are regarding to the paragraph in the script and the PR that describes the revenue from deployed systems and OEM services, correct?

Yes. So just curious how many systems were deployed.

I'll refer you to the paragraph. And I don't think in general saying that the answer is changing with regards to the system.

Okay. And then looking to the balance of 2025 and meeting 100 units in various stages of deployment, what types of agreements should we be thinking about in terms of those being a lease versus capital sales? .

Most, I would say, the majority of the [indiscernible], the majority are [indiscernible].

But we still see where we can see an increased activities in the CapEx sales [indiscernible], okay? So we do expect to have some [indiscernible].

Our next question coming from the line of Jeffrey Cohen with Ladenburg Thalmann.

Nice to see the company in [ Medicare ] this week. So a few for beer end, it seems like we've got a good sense of the top line from what we're talking about for the balance of this year and certainly for 2026 with the many partnerships...

Jeff, I'm sorry, can you raise your voice, please? Because you far away from the [indiscernible].

So could you talk about how OpEx could look over the next 4 to 6 quarters as you talk about achieving these 2026 targets versus currently?

Generally saying what you would expect to see is that our investment in the deployment efforts, namely the sales and marketing expenses will increase, of course. Because we need to invest in all the activities that are related to the deployment of the systems and the sales.

On the other hand, you should see more tamed R&D expenses as the focus is going towards commercialization and less on development activities. And we are trying our best to be more, as you know, to be as efficient as we can be, and you should see the same level of G&A with some fluctuations.

That's a major portion of our G&A expenses are related to us being a public company. And sometimes those expenses increased.

Got it. Could you talk about Vaso. I saw in the press release, there's a mention of approximately 100 customers. Could you talk about what types of customers that they currently have? And the opportunity for those customers into the Nanox family. .

So the 100 customers of Vaso are all of them are medical related, they are actually serving hospitals, imaging centers across the United States. From our point of view, the -- we have a lot of cross-selling that can be achieved. They can -- the majority of the -- I would say, the main purpose of the Vaso acquisition will be to serve the operational and the customer base -- growing customer base of Nanox.AI. But the more we go into the details what we see right now within the PMI and the post major integration that they will be able to expand our sales force to the ARC systems to those institutions to expand the services of the IT services that they are providing because many of those customers are modality related customers. .

In addition, what we see is that customers -- a few of the customers already mentioned an interest that U.S.A. teleradiology business will be provided by our teleradiology services. And in addition, the teleradiology, those customers are saying that they can actually refer a few of their customers to teleradiology services to be obtained. The -- I would say that this will actually strengthen our IT and software which is one of the major pillars of our growth. And we definitely can see their network and their customer base as a way to grow our business -- our existing business.

Got it. And one more, if I may. I did hear you mentioned breakeven EBITDA levels. But just prior to that, you mentioned something about '26. Could you reiterate that?

Yes. We mentioned this is already the second time that we say that what we are aiming that on a run rate basis on '26 the AI business will be breakeven. In fact, this was even before [ Revill ] acquisition. So right now, we believe probably that it will accelerate the probability of this to be breakeven sometimes that at the end of 2026. And the other thing that we said that the hardware business will shoot for a breakeven in 2027. This is something that we already mentioned in the past.

And what you can see right now based on the wide -- and what you see is that we are making progress in all the fronts in technology and the regulation and the commercialization of the business and we strongly believe that the retail business, the business partners and our facility would actually enable us to be there. Ran, would you like to add anything?

Yes. Let me find tune it. What we have said in the past that the AI business will be breakeven on a quarterly breakeven during -- sometime during 2026. We didn't specify in the quarter. We do emphasize the growth of the division by the expansions of their B2B2C model enter into new geographics. And of course, with the acquisition of [ Vaso ], which expands expand their operations and the potential for growth and achieving the quarterly breakeven on a quarterly run rate. And while we also have said that we expect that sometimes to during 2027, we may be breakeven in the ARC division. All in total, it will bring us sometimes in 2027, we may be breakeven on a wide company range. Just to be more correct.

Our next question coming from the line of Scott Henry with AGP.

Thank you and good morning or afternoon, depending on your location. I want to talk a little bit about the 2026 number. $35 million, that's a pretty big number. So my question is, how should you think about the cadence of the year? Do you expect that to start in Q1 and ramp up? Or should we think about that in the second part and then as well, do you have any preorders or any -- just trying to gauge your confidence in that number.

So first of all, I would start with the second comment. Most of what we say, we are based on -- not most, but I would say major part, we are based on preorder and the outcome of what we are doing right now, including those three elements, the business partners, the retail, which is a major part. And the sales force that we currently have, not to mention the new acquisition.

Second, I would say that it will start slowly from Q1 and ramp up over the quarters and achieve the number at the fourth quarter. If I have to say something about mathematics. I would say that probably the line will be kind of an exponential one, and not the linear.

Just to add 54% EBITDA we do see some more activities. I'm going to refer to the at what we said in the last question for Jeff. We don't forget that the current sensors and our estimates are based without the peso acquisitions. So when you add the best acquisitions you already going up you have to account for the $4 million in revenues that approximately the vessel. So other than this, the growth may come probably organic in the.

Okay. I think, Ran, did you say that [ Vaso ] would contribute $4 million in revenues? Have you broke up yet?

Yes, approximately.

Okay. And as far as the levers in 2026, what about teleradiology? It reported a strong growth rate in third quarter. Is that growth increasing? I mean, historically, it's been kind of a 10% grower. Are you looking for kind of a breakout in that category? Certainly, it was strong in Q3.

The answer is, if you look at the numbers that we gave as guidance, the numbers are not based on a major quantum lead growth on the teleradiology. We hope that it will grow, but based on the indication that we gave, it's based on the sort of the existing plus/minus numbers. The over growth will come from the other business that we have, namely the ARC business and the essentially deployment of the [ ARC X ] and especially the -- hopefully, the elimination of the adjunct device of the FDA and the other business that we set and the AI business that we're talking.

I think that OEM also will grow slowly, and we will see a major growth from 2027 based on the indications that we currently have from our existing customers and potential customers of the OEM business.

[ Out ] will be the AI and the ARC, and outwear product.

Thank you. And at the end of our Q&A session. Ladies and gentlemen, this concludes today's conference call. Thank you for your participation.

Good day, and thank you for standing by. Welcome to the Nanox Imaging Second Quarter 2025 Earnings Call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to hand it over to your first speaker, Mike Cavanaugh, Investor Relations. Please go ahead.

Good morning, and thank you for joining us today. Earlier today, Nanox Imaging Limited released financial results for the quarter ended June 30, 2025. The release is currently available on the Investors section of the company's website. With me today are Erez Meltzer, Chief Executive Officer and Acting Chairman; and Ran Daniel, Chief Financial Officer.

Before we get started, I would like to remind everyone that management will be making statements during this call that include forward-looking statements regarding the company's financial results, research and development, manufacturing and commercialization activities, regulatory process and clinical activities and other matters. These statements are subject to risks, uncertainties and assumptions that are based on management's current expectations as of today and may not be updated in the future. Therefore, these statements should not be relied upon as representing the company's views as of any subsequent date. Factors that may cause such a difference include, but are not limited to, those described in the company's filings with the Securities and Exchange Commission.

We will also refer to certain non-GAAP financial measures to provide additional information to investors. A reconciliation of the non-GAAP to GAAP measures is provided with our press release with the primary differences being non-GAAP net loss attributable to ordinary shares, non-GAAP cost of revenue, non-GAAP gross profit, non-GAAP gross profit margin, non-GAAP research and development expenses, non-GAAP sales and marketing expenses, non-GAAP general and administrative expenses and non-GAAP gross loss per share.

With that, I'd now like to turn the call over to Erez Meltzer.

Thank you, Mike. Good morning, and thank you all for joining our second quarter 2025 call.

As we enter the second half of 2025, the entire Nanox team remains focused on disciplined execution and expanding our commercial footprint across our entire ecosystem, including AI and teleradiology solutions as we pursue our vision of making medical imaging more accessible and thereby improving patient outcomes.

In line with the commitments outlined during our May 2025 earnings call, we are making steady progress toward our goal of 100 Nanox.ARC systems installations. Expanding our commercial footprint remains a top priority, and our sales team continues to expand the pipeline of qualified leads and successfully convert those leads into systems being shipped to customers. While most leads and new customer activity is now being sourced from the U.S. market, we also continue to expand our network in different countries outside of the U.S., including various European countries such as Romania and Greece on the heels of obtaining the CE mark designation earlier this year. We are well on our way to meeting our target of 100 systems installed or being deployed by year's end. As previously indicated, revenues are expected to grow in the second half of 2025.

We are also advancing our clinical strategy on multiple fronts as we seek to strengthen our position as a transformative force in medical imaging. To support this movement, we are acting on multiple fronts, clinical data and publication collaboration with global academic institutes, hands-on clinical education initiatives and expanding our key opinion leaders network. In other words, our commercial rollout involves bringing new technology to the market while also working to change the habits of health care providers.

With respect to academic partners, supporting our transformative vision, we seek to partner with organizations that are leaders in medical imaging innovation. A prime example in our collaboration with researchers at Duke University Medical Center, which I'll tell you about later in my prepared remarks.

Another example can be found in our recent announcement that Keiser University has established a flagship training and demonstration site, integrating the Nanox.ARC into the radiologic technology graduate program and enabling hands-on education for future imaging professionals. This is particularly exciting as the radiologists of the future are immersed in Nanox.ARC early in their careers.

To raise awareness and drive education on the Nanox.ARC systems, we created a clinical education program. The clinical education specialists who run this program play a central role delivering structured customer onboarding and ongoing training through site visits, working with the referral physicians, training the site personnel through webinars and tailored educational plans. We recently launched the Nanox Academy digital platform tailored for our clients, partners and our Nanox network collaborators offering full product sales and clinical online training.

Extending our clinical evidence, the ultimate output of these studies are peer-reviewed publications and white papers and academic publications derived from data generated by studies such as those currently being conducted with Shamir and Beilinson Medical Centers. These papers demonstrate the diagnostic potential of our cold cathode tomosynthesis system in imaging, offering a lower radiation cost-effective alternative to CT.

Moreover, we are constantly expanding the number of images bank of case studies, which serves to help illustrate the capabilities of the Nanox.ARC system. This growing bank of scans also serves as a useful tool for our sales team when in discussions with imaging centers about the utility of the Nanox.ARC.

The final leg of our clinical development platform is our key opinion leaders network. This strategy is evolving into structured segmented model that includes visionary leaders on our advisory board, clinical collaborators and show sites. This approach enable us to amplify our clinical voice, holding seminars and webinars talking about the clinical value in conferences while supporting presales activities and beta testing in targeted specialties such as orthopedic and lung cancer screening.

Together, these efforts form a cohesive clinical narrative that supports commercialization, enhance credibility and drives adoption positioning Nanox as a category-defining innovator in low-cost 3D digital radiography.

With that said, let's now move ahead to our operational highlights and updates. Turning now to our installation progress in key U.S. markets. I'm happy to report that our pipeline has grown substantially since our last call. We continue to install system in various facilities, primarily stand-alone multi-specialty, small- and medium-sized health clinics. These installations appear to be in line with the industry standard sales cycle. This increase in the sales pipeline is due to our investments in sales development representative initiatives, both internal and external, in order to increase the pipeline and conversion. These efforts are clearly resulting in traction with the medical imaging community and our commercial ramp will remain a primary focus.

On another promising note, a growing number of customers with Nanox.ARC units installed are actively referring and scanning patients. Among the notable customers, the Nanox.ARC systems will soon be installed at Keiser University Sarasota campus for training health care professionals, including live demonstrations and incorporation into Keiser University Radiology Technology graduate program.

We have also installed units in several imaging chains in California and New York. Of particular note, one of the largest medical imaging chains in the U.S. with hundreds of locations from which we recently generated revenues has completed installation of the ARC and began Nanox.ARC application training for its technicians in the last week of July. This is the final step before patient scanning begins, and we expect this chain to start scanning patients in the third quarter. The chain is also preparing to expand Nanox.ARC deployment to a second site within its network.

As many of you are aware, we are supplementing our direct sales efforts via channel partnerships in select markets. And in the U.S. distributor partnerships we announced last quarter with ASI and Swiss Re are both fully completed and are off to good starts.

Additionally, we are in advanced negotiation with large distributor and equipment reseller with a presence throughout the U.S. To support these partnerships, we provide comprehensive training and onboarding covering everything from system fundamentals and the clinical positioning to sales processes and contracting workflows. Our goal is to equip our partners with the tools and knowledge they may need to confidentially reengage their networks and promote the Nanox.ARC.

As part of our efforts to expand our go-to-market strategy, we are working on developing a future project. Nanox is developing a mobile imaging solution that integrates the Nanox.ARC system into a commercial vehicle. The mobile Nanox.ARC vehicle will serve as a traveling medical imaging center visiting clinics to provide high-quality diagnostic imaging without requiring patients to travel to central hospitals. The goal is to expand access to high-quality imaging, improving patient reach and create new opportunities for service delivery and revenue growth.

Turning to our rapidly growing Nanox.AI business. I'd like to share details of several product collaborations that we are working on. First, I'm pleased to announce that Nanox.AI and a leading provider of advanced AI-powered medical imaging solutions are collaborating to integrate Nanox.AI's liver and bone products with a provider's advanced visualization software. This new partnership will allow us to extend the benefits of Nanox.AI to a larger customer base, enhancing our collective offering and providing greater value to our users.

Another commercial collaboration I can share is between Nanox.AI and a leading company, which provide an AI-powered health informatics with the aim of empowering breakthroughs in care through imaging. The collaboration leverages advanced AI for operational efficiency and improved clinical outcomes in lung. In another recent example, we have signed an agreement with deepc to incorporate cardiac, bone and liver products onto the deepc platform, and deepc is a multinational company, which markets an infrastructure platform, deepcOS designed to unify diverse radiology AI workflow across the enterprise. Having Nanox.AI solutions integrated within this platform will make our products available on a much larger potential customer base.

Another collaboration that I'd like to share today is with CTIS, a leading provider of health informatics solutions with decades of experience partnering with clinical trial and research stakeholders, particularly in support of NIH projects. Nanox.AI and CTIS have joined to force to pursue 2 NIH grants aimed at analyzing gland cancer in young vapes users, which is acknowledged to be a looming health problem in the U.S. Needless to say, it is encouraging that a growing group of AI platform providers recognize the value of our technology and are taking the time to integrate the Nanox.AI solutions into their open architecture platform offering.

Furthermore, as previously announced, we have finalized the collaboration between Nanox.AI and Ezra, a leading provider of full-body MRI screening services. Initially, the collaboration included Nanox.AI population health solution integrated to Ezra medical screening processes at 28 imaging center locations across the United States, which feature AI-powered full body MRI and CT scan to screen adults for early detection such as cancer and other serious conditions at their earliest and often most treatable stages. The solution is now integrated into 50 sites with both the number of installations and the volume of scans steadily increasing.

To continue our updates for Nanox.AI, I'm pleased to report that the leading academic institution has launched a major collaboration with Nanox.AI, selecting 3 of our advanced artificial intelligence applications to power a new population health clinical study targeting asymptomatic individuals aged 70 and above. These marks another milestone in our ongoing academic collaboration. We continue to partner with leading academic institutions that are leveraging our AI solution.

I can also report that we signed an agreement to provide Nanox.AI solution to customers of Radiology Diagnostic Group, RDG, a network of specialized senior radiologists offering rapid expert imaging interpretation, valuable second opinions and detailed explanation of imaging finding. In addition, we recently partnered with a reseller in India to market Nanox.AI solutions, securing 2 pilot projects and positions us to expand our footprint in the region. Moreover, we are strengthening our U.S. presence with the expansion of our service and sales infrastructure to support growing market demand.

Turning to deployment and other activities outside of the U.S. We continue to advance along multiple fronts such as key EU market and where we feel that distributor model is an efficient way to make initial inroads into the various nations of the EU. We accelerated our efforts in the EU after Nanox.ARC was granted the CE mark designation under EU MDR standards earlier this year. Our team recently met with our partner in Romania, Medis Imaging, which is a leading medical equipment supplier in the country. It was a highly productive engagement, which included a training session for MEDDIC sales personnel.

Next step is to launch the Nanox.ARC in the annual Radiology Congress in Romania with our new partner end of September. The system is ready for shipment for that purpose. This is an exciting step forward in making Nanox innovation and imaging solutions more accessible across Europe and promising start bringing next-generation medical imaging technology to Romania.

We are currently working with our local partner in Greece to secure the required import permits and are engaged in advanced discussions with additional potential partners in the region. We will continue to focus on the large EU market and expect that our strong business momentum will continue in many other European countries in 2025 and beyond.

In Latin America, we're also pursuing the import license to ship 2 demo units to distributor in Mexico, and I will provide an update when I have something material to share.

The company notified the FDA of its intent to submit the TAP2D software module to the FDA through the 510(k) program. TAP2D submission purpose to receive clearance for 2D view image output for Nanox.ARC system, a practical tool for radiologists to enhance their diagnostic confidence as they become more experienced evaluating BTS images. TAP2D, once cleared, will be part of a wider vision held by Nanox to alleviate adjunctive use limitations in the future.

Moving on to the clinical work that helps support all of our efforts by generating data supporting the use of our solutions. As I mentioned in my introductory remarks, we have several successes to share today, including our collaboration with Keiser University and our ongoing partnership with Duke University Center for virtual trials.

We have mentioned the Duke partnership on previous calls, and I'm now able to share that this collaboration has resulted in the publication of a new paper that has just been published. In collaboration with Dr. Ehsan Samei's team at the Center for Virtual Imaging Trials, CVIT at Duke, we have seen promising results of the potential values of Nanox.ARC digital tomosynthesis, the DTS configuration in handling patient motion as opposed to standard linear configuration DTS system. Patient movement during image acquisition can adversely affect the quality of medical image, and the study shows the benefit that Nanox.ARC configuration has the potential to effectively manage this issue.

The study addressed various types of patient motions and showed that the Nanox.ARC configuration is less susceptible to motion-induced artifacts. The data and conclusions of the study have now been published in Biomedical Physics and Engineering Express, making key opinion leaders aware of the value of the Nanox.ARC for sound mounting a common imaging challenge.

Earlier, I acknowledge the value of bringing medical imaging experts and key opinion leaders onto the Nanox team. And with that goal in mind, we have recently strengthened our Medical Advisory Board with 2 new additions. Dr. Lawrence Tanenbaum is an active consulting in the medical imaging space. He is a long-term collaborator for the medical imaging industry and continues to chair advisory board for imaging, OEMs, pharma and AI concerns. He has interest in developing applications for AI and machine learning, concert agents, MR, CT and advanced rendering. Dr. Tanenbaum served as Vice President and Chief Technology Officer and Director of Advanced Imaging at RadNet Inc. from 2015 to 2024.

Second, George [ Spire ] is a medical imaging executive with over 25 years of global leadership experience. He has held senior roles at [indiscernible] and Philips specializing in imaging technology and digital health transformation. He is an expert in bringing innovation to market and scaling customer-centric tech-driven health care solutions.

We are excited to have these talented individuals join the Nanox team as we seek to innovate and change the medical imaging landscape. Our key opinion leader strategy is evolving into a structured segmented model that includes visionary leaders, clinical collaborators and show sites. This approach enable us to amplify our clinical voice while supporting presales activities and beta testing in targeted specialties such as orthopedic and lung cancer screening. Together, these efforts [indiscernible] cohesive clinical narrative that support commercialization, enhanced credibility and driven adoption, positioning Nanox as a category-defining innovator in digital radiology. We continue close collaboration with our OEM partners toward the supply of components needed as our ARC deployment continues.

Furthermore, we are seeking partnership with additional providers of unique imaging equipment to develop new and innovative uses of our 3D tomosynthesis technology. Additionally, in Q2, we met with multiple companies across a handful of application areas we believe our technology provides unique and even disruptive technical benefits. These companies were approached based on an exhaustive review of their applications, market position, our perceived product fit and of course, the commercial opportunity potential. Having received several requests for additional data and/or testing results, we are now reviewing, prioritizing and formulating responses outline proposed next steps.

New applications and business development efforts take time, but this activity level demonstrates our continuous probing for new use cases and applications for our differentiated imaging technology. I'd also like to follow up on my comments regarding Varex from our last call. We are sourcing glass tubes from Varex for our units as they are more economical than ceramic and advantageous for our application. At this time, I shared that Varex had delivered tubes for use in the newly developed Nanox.ARC and that Nanox has technical staff at Varex facility for validation and training on multiple source demo units. The ARC team in Israel began system integration of Varex tubes into the ARC X earlier this month, and we approached the time to start manufacturing the new ARC X at scale to meet anticipated customer demand. Also, delivery of the first multisource demonstrator from Varex is anticipated later this month.

With regard to mass production, we have recently entered into a multiyear Volume Supply Agreement with Fabrinet, a leading global electronics manufacturing services provider to support the scalable production of Nanox.ARC X, Nanox Advanced Medical Imaging. Under this agreement, Fabrinet will provide contract manufacturing services, including assembly, testing, procurement and quality control, ensuring reliable and cost-effective product delivery aligned with [ Nanox.SOURCE ] specification. The long-term agreement will help to ensure stable and high-quality manufacturing as well as flexible production and forecasting to support our anticipated growth. In addition to manufacturing services, Fabrinet will support regulatory compliance, quality assurance and continuous improvement processes to help optimize the efficiency of the manufacturing process. We believe this collaboration will drive down our manufacturing costs over time and strengthen our global supply chain, which will, in turn, support our mission to expand access to innovative, affordable imaging technology worldwide.

Thank you, Erez. We reported a GAAP net loss for the second quarter of 2025 of $14.7 million, which is the reported period compared with a net loss of $13.6 million in the second quarter of 2024, which is the comparable period. The increase in net loss was mainly due to the increase of $0.4 million in our gross loss and $1.0 million in our finance expense net, which was mitigated by a decrease of $0.4 million in our operating expenses.

Revenue for the reported period was $3.0 million and gross loss was $3.2 million on a GAAP basis. Revenue for the comparable period was $2.7 million and gross loss was $2.9 million on a GAAP basis -- non-GAAP gross loss for the reported period was $0.6 million as compared to a gross loss of $0.2 million in the comparable period, which represents a gross loss margin of approximately 21% on a non-GAAP basis for the reported period as compared to a gross loss margin of 9% on a non-GAAP basis in the comparable period.

Revenue from the teleradiology services for the reported period was $2.7 million with a gross profit of $0.5 million on a GAAP basis as compared to revenue of $2.5 million with a gross profit of $0.4 million on a GAAP basis in the comparable period, which represents a gross profit margin of approximately 18% on a GAAP basis for the reported period as compared to 15% on a GAAP basis in the comparable period.

Non-GAAP gross profit of the company's teleradiology services for the reported period was $1.0 million as compared to $0.9 million in the comparable period, which represents a gross profit margin of approximately 38% on a non-GAAP basis for the reported period as compared to 37% on a non-GAAP basis in the comparable period.

The increase in the company's revenue and gross profit margins from the teleradiology services was mainly attributable to customer retention, increased rates and increased volume of the company's reading services during the weekdays, weekends and night shift.

During the reported period, the company generated revenue through the sale and deployment of its imaging systems and OEM services, which amounted to $221,000 for the reported period with a gross loss of $1.7 million on a GAAP basis and non-GAAP basis compared to revenue of $68,000 with a gross loss of $1.3 million on a GAAP basis and non-GAAP basis in the comparable period.

The company's revenue from its AI solutions for the reported period was $0.1 million, with a gross loss of $2.0 million on a GAAP basis compared to revenue of $0.1 million with a gross loss of $2.0 million in the comparable period. Non-GAAP gross loss of the company's AI solutions for the reported period was $19,000 compared to a gross profit of $57,000 in the comparable period.

Research and development expenses net for the reported and comparable period were $4.8 million, reflecting no change between the period. Nevertheless, there was a decrease of $0.4 million in share-based compensation and $0.3 million in expense related to our development activities, which were mitigated by an increase of $0.3 million in salaries and wages and a decrease of $0.4 million in grants received.

Sales and marketing expenses for the reported period were $1.2 million compared to $0.8 million in the comparable period, which represents an increase of $0.4 million, mainly due to increase of $0.3 million in salaries and wages and $0.1 million in marketing activities with connection to the commercialization in the U.S. market.

General and administrative expenses for the reported period were $5.1 million compared to $5.9 million in the comparable period. The decrease of $0.8 million was mainly due to a decrease of $0.5 million in share-based compensation, a decrease of $0.5 million in the company's legal expenses and a decrease of $0.2 million in D&O insurance expenses, which was mitigated by an increase of $0.2 million in salaries and wages.

Non-GAAP net loss attributable to ordinary shares for the reported period was $10.9 million compared to $8.4 million in the comparable period. The increase of $2.5 million was mainly due to an increase of $0.4 million in non-GAAP gross loss, increase of $1.0 million in the non-GAAP operating expenses, and increase of $1.0 million in non-GAAP financial expenses.

Turning to our balance sheet. As of June 30, 2025, we had cash, cash equivalents, restricted deposits and marketable securities of approximately $62.6 million and had $3.3 million in short-term loan from a bank. We ended the quarter with a property and equipment net of $46.1 million. As of June 30, 2025, and December 31, 2024, with approximately 63.9 million and 63.8 million shares outstanding, respectively.

With that, I will hand the call back over to Erez.

Thank you all for joining us today quarterly call. We appreciate the ongoing support from our investors, which is vital in helping us achieve our vision of making medical imaging more accessible worldwide and improving patient outcomes.

Nanox has made progress advancing our Nanox.AI business on multiple fronts and the deployment of the Nanox.ARC system in the second quarter, and we are on pace to meet our target of 100 units in the deployment by year's end with revenues expected in the second half of 2025. We are seeing a growing and increasingly robust manufacturing pipeline, and we are proud to mark a breakthrough in the European market with the first system ready for shipment and working on enlarging our network.

By expanding our systems output with a 2D view image, we reaffirm our commitment to continuous product enhancement in line with the evolving market needs. Alongside our commercial efforts, we are executing a robust clinical program designed to product dating supporting the use case of Nanox.ARC technology. We continue to partner with leading academic institutions that are leveraging our AI solution and engaging key opinion leaders who can partner with Nanox to drive behavioral change in the medical imaging sector. I'm proud of our team's diligent execution of our multifaceted growth strategy.

If you would like an update call with the team, please contact our Investor Relations partners at ICR Healthcare. Thanks again for your time and attention today, and we look forward to our next update.

[Operator Instructions] Our first question will come from the line of Ross Osborn from Cantor Fitzgerald.

So starting off, how many systems were operating during the quarter that resulted in $221,000 in imaging-related revenue?

Can you repeat the question?

Yes. How many systems were operating during the quarter, [ meeting ] scans were being performed that resulted in your reported $221,000 in imaging-related revenue?

Out of the 100 that we are currently targeting for the end of the year and the more than 60 that we published last time?

Yes. So I guess out of those 60 or however many are in the field, how many systems were operating, meaning that patients were being scanned?

Okay. So right now, more than 20 are operating and scanning patients. And all the numbers that we gave last time have increased. So the number of operating system, the number of the systems which are being in the process to install, the number of fleets have grown exponentially that we are currently dealing with, namely the deal flow.

Right now, as previously indicated, we are -- we can say that the 100 that we are talking about are identified. So we know each one of them, almost each one of them, when it's going to be installed and when it's going to be shipped and start to operate.

Okay. That's great to hear. And then looking at those 100 leads, are you expecting any of those to be capital sales? Or should we assume they will all be placed via the MSaaS model?

I would say that a part of them will be CapEx.

Great. And then lastly, how many states in the United States are you now approved in for users to operate a system?

Right now, 8.

Our next question will come from the line of Scott Henry from AGP.

I guess, first, a follow-up on the placements of units. Could you talk about the current revenue model? Is it mostly subscriptions versus CapEx in licensing? Just trying to get an idea of how that model has evolved as the launch has continued.

Okay. You want to go ahead, Ran?

So Scott, as we have discussed in the past, our leading model is the MSaaS model. But as we said also in the past, we are -- we do want to do some CapEx sales.

Just to remind you, we said in the past that all the sales in the European countries will be in a CapEx sales model to our distributors. And in the U.S., we expect to be a mixture of CapEx sales and MSaaS model. Some other territories will be probably MSaaS or CapEx sales depends on the traits of the geographics.

Okay. Great. On -- just looking at the quarterly revenues, the AI solutions line, it moves around a lot, and the numbers are pretty small. But I'm just -- that would be the 96,000 reported in 2Q. Could you give us a sense of where that number should go going forward? I mean, should we start to see more trends evolve as opposed to kind of a lot of volatility in it currently?

The answer is yes. From the AI point of view, we have indicated already that 2026 will be breakeven in terms of revenues and expenses of the AI. We see a continuous growth in almost each one of the places that they are located, the system. Bear in mind that with respect to the AI, we have a lot of -- we have a lot of impact coming from the revenue recognition policy. So although, for example, we do install the systems, we get annual payments right now. So from a cash flow point of view, we are by far more than the number that you see in the quarter.

And the other thing that should be noticed is the fact that, for example, Ezra Medical, the one that was mentioned last time and this time as well, is growing exponentially in terms of the numbers. And this is going to be part of the really growing activities that we see, the B2B2C.

And we have a similar agreement that we announced today that was signed that is going to be, from our point of view, even double than the revenues, which will be generated from Ezra Medical. With respect to the OEM, it's basically -- it's when it comes, we register and only when we ship the numbers.

So I think that the 2026 will probably be more of an indication of the numbers that will show the growth that we're talking about in the agreements that we signed.

Okay. Great. And then just quickly on operating expenses. Any trends we should expect? I mean it's been pretty consistent around that kind of $11 million to $12 million a quarter range. Should we expect that to continue going forward? And I guess it's probably the 2026 time frame as well. When would you expect to start seeing the quarterly losses start to decline? I know it's an expensive business model, but at some point, you reach that inflection where the revenues start to outweigh the cost. Just trying to get an idea of when that is. Sorry, there's 2 questions in there.

Yes. So with regards to the OpEx itself, you see there it's correct that it's maintaining the same level in the past few quarters, and that comes from more efficiencies and more measurements that we do to maintain the level of the expenses and to keep our brand to the minimum.

On the other hand, you see an increase of our sales and marketing expenses as a result of the deployment in the U.S. market and the increase in our sales and marketing activities.

All in all, we -- it's a trade-off. Once we increase in one place, we do decrease in one place, and we're trying to maintain the same level of expenses. And as we have said before and in the past, once you see, especially in the second half of this year and going forward, when you're going to see the revenue alleviating, then you should see a decrease in the operating loss and the burn, et cetera.

Our next question come from the line of Jeffrey Cohen from Ladenburg.

Firstly, could you talk about studies and submittals and publications and presentations in the back half of the year, specifically around RSNA and your activities headed into RSNA?

So towards the RSNA, we have -- we're going to submit -- we have submitted already. Actually, we will present the full Nanox end-to-end solution and the high-profile industry event in the first time that we're going to be there.

We are going to present the ARC X, including -- we are going to show the first installation of the first AI interpretation on the -- as part of the ARC X systems. And we are planning to -- we have submitted one clinical paper that is going to be on the MSK. I mentioned it to you earlier in the in the -- and when we are -- I was talking about a few minutes ago in the earnings prepared remarks.

And we are going to present at the AI theater. We're going to have a presentation made by our Chief Medical Officer, and we are going to include our key opinion leaders that will talk in various stages during the show, especially Dr. Tanenbaum and [Technical Difficulty].

Jeff?

Yes. Okay. Sorry, I'll just lost you there for a second. So -- and as a follow-up there, could you talk about geographies specifically as far as both ARC placements as well as the AI solutions into the balance of this year and throughout perhaps '26 and '27 as far as countries and regions of geographical presence where we expect some nice uptake?

Okay. So first of all, we have indicated today in my remarks that the focus will be in the U.S., both for the AI and for the ARC as well. And this will be a major part of our efforts, including the number of people that are going to be dedicated to the sales and marketing efforts.

In addition, we are planning to focus on the EU countries. Right now, we have in our list approximately 8 countries. A few of them already signed and a few of them are in the process of being signed very shortly. We are very proud about the fact that less than half a year from the CE marks, the first system is going to be sent to Europe and installed in Romania at our distributor. Next probably in the line will be Greece. We are talking about a few like 3 or 4 countries in Europe. And this will be the second part.

In addition, we are going to spend or dedicate efforts, including salespeople and the channel managers, people that will focus on Mexico. Mexico is the country that we have already an agreement for quite some time, but the permit, the import license and the local certification takes time. The system is -- we are talking about a few systems that will be sent to Mexico. They are ready to be shipped. We are waiting for the permit in the very near future. We are negotiating right now for another few countries in Latin America that will be part of it.

The one thing that I'm saying is that right now, the Far East is going -- is not going to be the first priority, although we have already a distributor that is working on the license in Korea, but the rest will wait. We are not going to focus or spend a lot of time on Africa right now until we get more clarity on the economy situation of the countries that we are working with.

But in terms of the AI that you asked, right now, U.S. is the primary market. Europe is second and Latin America is third. Although we have also -- we mentioned that we have already 2 pilots in India. We have one system already installed in Thailand, and this is in addition to what we say.

In terms of the OEM, basically, we are working on an international basis. We have one customer in Europe, one big customer and one big customer in the U.S., also in Israel that we have. One other market that I didn't mention, but it's part of the efforts is Israel. We have all the systems in Israel are installed in hospitals. And -- and right now, we are planning to install a few of the AI systems similar to the one that we have with Ezra Medical in Israel as well.

Sorry for the long answer, but the detailed one.

The one thing that I would say, Jeff, is basically from the call, what you can see is that we are really playing across the whole court with the business development in the workers' comp, in the mobile units that we are talking about the future. And from our point of view, there are no shortcuts. We go step by step one after the other. We are really changing the standard of care. And therefore, it's very organized. It's widespread in terms of the areas that we're focused on. And we see the results of the way that we operate this step-by-step and no shortcuts, we see the results that are coming time after the other, quarter after quarter, we see the results, especially the efforts that we're making on the clinical side that I was talking about, I elaborated today quite a bit because when you want to change the standard of care, you have to dedicate a lot of time to brand awareness to clinical education, to referring physicians to explain the -- everything which relates to what's the value, what's the clinical value that you bring to the market and to the customers, and we see the results of it.

And with that, this concludes the question-and-answer session. Thank you for your participation in today's conference. This does conclude the program. You may now disconnect. Everyone, have a great day.

Good day, and welcome to your participation in today's virtual event. Up next, we are pleased to introduce Nano-X Imaging Limited. [Operator Instructions]

At this time, it is my pleasure to hand over the session to Ran Daniel, CFO at Nano-X Imaging Limited, who will lead the presentation. Sir, the floor is yours.

Thank you very much, and thank you for hosting us today. I'm the CFO, not the COO.

Before I'm starting, I would like to remind everyone that I will be making statements during this presentation that may be deemed forward-looking statements regarding the company's commercialization activities and other matters.

This is our disclaimer. Please do [indiscernible] seconds and read it. I'm very pleased to say that we are making progress in our mission to progress the emdical imaging and improve patient outcomes. Our innovative technologies, including Nanox.ARC and our AI solutions are gaining traction in the market.

I'm going to start with who we are and from where we came. So short history, the company's histories come from Sony on the -- from the days for the race for thin TVs. The group of scientists developed this chip, which you can see over here on the bottom, which this is our source, and at some point, Sony retired from the race and spun off this technology to this group of scientists that went to the University of Tokyo.

In December of -- during 2018, the current Nanox was established after development of the technology by our founder and those group of scientists, which were our partner together a long time ago. And the application of their technology was applied in a medical device sector.

You can see here this is our flag product. This is the Nanox.ARC 3D digital multi-source products. We developed these systems, which are, actually, you can see behind me. It combines the multisource Nanox.ARC imaging device with our cloud-based Nanox.CLOUD platform.

The system uses a proprietary digital X-ray source, which you can see over here, our source as opposed to warm, hot cathode. In our case, it's a cold cathode. It's the source itself. This is the NEMS chip that was developed by us and Nanox.TUBE, which also are proprietary tube that we also developed in our fabbing career. The system actually produces 3D tomosynthesis images and I'll show you some example later in this presentation. With multiple stationary tubes arranged around the patient.

Now if you consider the machine, the machine itself actually, if you see on the bottom of the slide, you can see the tube and the source, which goes in together, we put 5 tubes space evenly on the assembly house of the tubes. And obviated over its camera. This is the bed simply goes back and forward with the patient on it, and the arc itself gets into 18 degrees to each side, which creates the tomosynthesis effect. What it brings us...

Excuse me, Ran. Your slides didn't go.

It's okay. I'm still on the same slide. It's the system is designed -- you don't see the -- you see the picture, correct? With the Nanox.ARC.

Okay. All right. So what's so unique about our system is small, it's lighter. You can see the system over here. And it's -- it's similar from -- it's a simpler x-ray system. It's not complex. There's no requirement to -- all the system is designed to streamline the medical imaging from scan to diagnosis.

We're offering a scalable cost, cost-effective solution for an early global detection. If you think about you see only the machine over here, but on the top of the machine, you should -- you should imagine our platform, our cloud platform, which contains all of our various solutions such as, first of all, the processing of the imaging is being done on our cloud platform, on our own proprietary software that we have developed, then you can also find over the AI solutions and also our teleradiology solution has also been done in the cloud.

Even our billing system has been down on a cloud. So you can think of it once the image goes to our cloud, then it's everything is really done on a real-time basis. I want to show you a demonstration of how the scan has been done. Now you can see over here that all you need over here is a technician with an iPad. I have the iPad over here, you can see its size. It's a regular iPad, the technician program software, the patient lays on the bed and then the bed is moving. And you can see -- in this case, it's a chest scan, and the arc is simply tilting to each direction, 15 to 18 degrees, which creates the tomosynthesis effect.

And the end result is 30 to 62 images that are going to our cloud and we constructed to 1 3D images. I'll let the illustration finish, and I'll move back to presentation mode with your permission.

So what are the tomosynthesis clinical benefits? First of all, the visuality is much better, it's a reduced superimposition of the normal structure that may reduce false positive cases, it's some details, more sensitivity, depth view. And as I said, it gives you the opportunity to expedite a diagnosis, which is important.

Actually, we are in -- as I said, we are in the tomosynthesis world, but we're actually between the spectrum of an X-ray and the CT machines. So while an X-ray produces only 1 image, the reading time is relatively short and the dose amount is relatively short. It's low. The CT machine produces hundreds of images. The reading time is much longer and the dose is much higher. You can see that with regards to the images, we are somewhere between the X-ray and the CT, and the reading time and the dose were very close to the X-ray.

So actually, the main benefit -- you can see it as the main benefit of our machine that gives 2 main benefits. First, economically, our cost and the cost for the patient is much lower than the CT. On the other hand, we produce 3D images such as CT. We don't cover 1% of the procedures or the intended use of the CT, but we do cover various cases that you -- that can be done in lieu of the CT.

This is just an example of a compression between a 2D and our image. You can see over here a patient with a cast usually when the patient comes with the case for a checkup or a follow-up, it needs to remove the cast, then it goes through the examination and then they put the cast again in our case. You can see that there's no need to remove the cast because simply the machine reads through the cast. Actually, it reads through, as I said, it's way through the layers of the human body.

This is another example of a hip fracture. And my favorite example which is this one. You can see over here ,a little over here. Which simply cannot see -- can be seen in a regular X-ray image.

Okay. What we have done, what we have achieved regulatory-wise, we have achieved, first of all, we got this machine the FDA -- the 510 clearance of the FDA in the U.S. for MSK in May 2023 and in general, in 2024. We also got in February of 2025. We got CE for all body. In April of 2025, we actually got a second general use clearance for the next version of this -- of our machine. I will discuss it later.

And we have a clearance -- we have clinical claims in other various countries. We also with regards to our AI solutions, most of our ad solutions are cleared by the FDA and CE. So regulatory wise, we are in a very progressive status.

Commercialization. We're currently planning to target in the U.S. market where we work direct imaging center, multi-special -- specialty medical centers, orthopedic groups, urgent carers and et cetera. We do have our internal sales team and consultants and business partner, actually, I'm sitting -- I'm based in New Jersey in -- Richfield, New Jersey, where our headquarter in the U.S. is based. We have a team that includes a sales marketing -- sales team meeting person and clinical support personnel, technical support personnel are very important to us because those are the guys that goes from 1 customer to another and goals on the functionality and the clinical value that our devices have. Other than our direct sales force, we have -- well, we have -- we have also -- we have also partnered with some distributors and business partners in the U.S.

Those are covering geographic carriers and some other niche that we don't cover directly. We have a deployment in the U.S. of 8 states, and we are going forward, in other, in ex U.S., we work usually only via distributors. This is just an illustration pretty straightforward going forward. By the way, you can find this presentation on our Investors section on the website. So I'm just going to explain things that needs to be explained.

Over here, you can see our business models. We do work on -- in a various business model. First of all, of course, we have the regular CapEx sales model where you can come by the machine. On the top, you will also offer the client maintenance contract and multi-year maintenance contract. On the other hand, and this is the more cost of the transaction that we have right now in the U.S. And they are actually our MSaaS model, medical scan as a service or simply paper used.

We do charge $30 per scan. We require a minimum scans per day of 7 scans per day with a multiyear agreement. As for the rationale that goes behind our pay per use model in the U.S. just as a general explanation, our system is covered procedure with his established CPT code of 76100 in the U.S. It actually covers most, if not all of the tomosynthesis internal use that we are doing.

The global RIM amount the end user totals approximately $88 to $109 depending on the location. The total -- the amount -- the portion of the professional amount is usually $30 per procedure, which leaves $58 to $79 for the technical portion for the operator. We charge $30 per scan for the technical portion for the scan itself for the usage of this machine. And we also charge $20 for the reading itself through our teleradiology division, which is based in Florida. All in total, you can see that it is net to a very hefty margin to the operator, somewhere between 43 to 54 -- estimate 43 to 54 -- it's a win-win situation.

We -- the operator enjoy an FT margin, and it doesn't need really to invest a big CapEx, outlay and doesn't need to go through all the sales process. It's actually you can deem it as an operational lease. And for us, we have a pretty nice margins from the service that we provide.

We have a few installations in -- within some hospitals worldwide. We have 3 installations in the U.S. We have -- mostly, they are been used for clinical trials that we conduct in braving Medical Center in Israel. We have 2 devices. One is this version and the other one is the new version, which I'll explain later.

In Shamir Medical Center have one machine and the largest hospital in Ghana, we have another machine. Okay. So the Nanox.ARC. We always -- we're constantly working on product and technology future developments. After we got our FDA clearance for that version, we worked and our created an upgraded version of the machine.

This -- it's our latest -- this is going to be our latest 3D digital multisource tomosynthesis system. It's improved design, which results in a smaller footprint. And enables us for more software outrates and more new capabilities to be added remotely following future regulatory clearances, namely some of the outputs at the moment, both version comes with the same output. On the other hand, this version -- you can see that it's a smaller footprint. This version, the new version, it actually comes with 15 foot span of the bed. It may be very long.

We found out that some locations it simply, it doesn't fit to the rooms because sometimes real estate in New York City, for example, it's very expensive. We want to get the full utilization. So this version, actually, with the smaller footprint of 9-foot will enable us to even to install it in March smaller rooms. It's, of course, it's a multi-access tomographic systems, same as the other version.

It has 5 tubes, 5 cold cathode tubes. The main difference that these systems we use our own proprietary ceramic tubes in this version, we use our own glass tubes, which are much cheaper. It makes these systems more cheap...

Excuse me Ran.

Yes?

They were asking me if you could show them the other slides.

There are the slides of what?

Of your presentations.

I'm showing the other slides.

All right. Yes, go ahead.

You don't see the slides with the machine?

We can see it now.

Because that's what I see. It's a lot of work over. It's just it's not convenient, but it's okay.

Yes. Thanks, Ran.

All right. So this is -- so this is -- I can't say it, it's a little bit too small for me. But okay.

So it's a smaller footprint, multi-demographic system. And yes, I tried the presentation, Mo. That's what it is. And it's a plug-and-play. If you can see this version, we have the electric covenant in the other side of the room in the new version, the electric covenant and all the other parts are simply going into the bed.

So actually, what we created, it's a one sleek design that goes into a corner of the room. You simply need to plug and use it. Okay. Tell me if I'm going to flip into the next slide, you can see that.

You can see the slides on our AI solutions.

Yes.

Okay. All right. So as I said, we have today, we have 3 business divisions. The first 1 is the hardware, which I just explained. The flat product is the Nanox.ARC and the Nanox.ARCX. We also acquired in November of 2021 our AI division formally from Zebra Medical Solutions in Israel. And we also acquired our teleradiology division in the same time. I'll explain a little bit of what we offer with our AI slows and where as of that because I see that the time is getting short.

We have several solutions that were cleared. As I said, but today, we are offering 3 main solutions. The first 1 is the bone health solutions. This is actually the second version of this product actually is made to address vertical compression fracture and low bone mineral density.

The second product is cardiac solution, which works on a coronary artery culture measurement. And the third one is the liver solutions. In the pipeline, we have also future applications that can be applied to the [ author ] and the full body compostion, which we do in venture with some universities in the U.S.

We have a few customers in the U.S. The largest one is [ Coral Health ], which entered into his fourth year engagement with us. He actually expected scope of AI portfolio from the 3 that you can see on the screen. Those 3 solutions actually compose our broad suite of population of solutions, which will add the future development, as I said before, Besides [ core solutions ], we see we have clients such as InterMountain, Covera Health, Dandelion Health. And recently, we also engaged with [ Ezra Medical ] as well as our Medical in New York City.

Mostly, mostly, this is a standard solution. But in the future, it can also -- will work on our tomo images, right? But you can also use it on your pack systems. Usually, the customers will take it and install it on the PAC system to scan all those city scans that they do to their patients. of course, in those specific applications. In the U.K., we had a big project with the U.S. Health Minister for quite a while, which we installed our bond sale solution in 5 different locations in the U.K.

As of this year, this project went into its commercialization phase. Since the time is short, I'm just going to -- I don't know what -- if you can see the slides, I'm just going to say some more words about -- some about our financials. Besides that, we have also our teleradiology division, and we also have our OEM business, where we have partnering with different customers regarding our core technology, which is the cheap and the tube that I showed before.

Some financial highlights. As of March 31, 2025, we had $73 million in cash and cash equivalents. We have a run rate of $3 million a quarter. We inspire to increase it, of course. And we have approximately 165 full time employees.

Now I'm open for questions, if there are some. I see how we can get a user manual for the new ARCX. There's a lot of materials that is available on our website, but usually, you use the manuals going to goes to our consumers. So I think it's our customers. Is there any other questions over here? Stefan?

You can look it up in the Q&A section.

Okay. the Q&A session. All right. Okay. I'm going to open it I'm going from the last one.

Can you provide a clear time line for the world of the Nanox.ARC systems.

As for the time out and the milestones of the rollout of the Nanox.ARC systems, I refer you to our latest earnings, we gave some kind of guidance in our earnings. We said that we estimate to have more 100 units or more deployed in the U.S. and the rest of the world. We do report revenues from the arc. Maybe they are not significant, but there are some revenue from the arc and the OEM business.

We don't engage with veterinary solutions, although it's an option for the future.

As for the how many arcs, again, I will refer. I'll refer to the language that we had in the latest earnings. I think you should read over there. It's -- there's a few dozens of systems that are deployed in various stages of deployment, but the accurate language is there.

Is there any other questions?

have you also received any buyout offers? Someone is asking from the chat.

Even if we receive the buyout offers and well, first of all, we have to disclose it first, if we are about to talk about something like that. So I assume there will be -- if there was something that we had to report through the SEC and according to all the regulations and the laws of security laws that I know. So I think it will be public information by now.

Any other questions?

There's also someone from Alistair, from the chat.

From the chat. All right. I'm going back to the chat. Alistair. At what stage of industrialization is the Nanox.ARC systems? The company's spend seems very low on this.

I think that what Alistair refers to is commercialization. We are in the beginning of the commercialization in the U.S. market. We have received the FDA clearance for an MSK only in mid of 2023, and we have started the commercialization in the U.S. market only in the beginning of 2024. So it's a very short time. Of course, with the new -- with the additions of the clearance for the general use.

So we have more opportunities in the U.S. market. We have received only to see this February. So for the European market, obviously, we are only at the beginning over there.

What is the Nanox portable device? Can you be more specific questions for Gilly.

If you are referring to the connect, so there's no new -- any other new updates. You can read all about it in our 20-F.

Any other questions, guys?

As I said, you can find a copy of the deck in our Investors section on our website. If anyone wants to have a call with me is more than welcome to contact our IR person.

His name is Mike Cavanaugh. He's contact details is also on our website. We would love to answer any questions that any investor has Okay. Thank you very much.

Thank you, Ran. You have a good one.

You too.

I appreciate you.

No problem.

That concludes Nano-X Imaging Limited's presentation. You may now disconnect. For details on upcoming presentations, please refer to the conference agenda. Thank you for your participation, and we look forward to welcoming you to the next session.