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Thank you for standing by and welcome to the LENSAR 1st quarter 2026 results conference call. At this time all participants are in a listen-only mode, after the speaker's presentation there will be a question and answer session. To ask a question during the session, you will need to press star one one on your telephone. If your question has been aswered and you'll like to remove yourself from the queue simply press star one one again. As a reminder this program is being recorded and now I'd like to introduce your host for today's program, Lee Roth, President of Burns McClellan, Investor Relations Advisor to LENSAR. Mr. Roth, please go ahead.

Thanks, Jonathan. Good morning, everyone, welcome to the LENSAR 1st quarter 2026 financial results and strategic update conference call. Earlier this morning, we issued a press release providing an overview of our financial results for the 1st quarter ended March 31st 2026. A copy of this press release is available on the investor relations section of the company's website at www.lensar.com. Joining me on the call is Nick Curtis, Chief Executive Officer, and Tom Staab, Chief Financial Officer of LENSAR, who will provide an overview of recent developments, our go-forward strategy and financial results. Following these prepared remarks, we'll turn the call back over to the operator to take your questions.

Before we begin, I'd like to remind you all that today's call will contain forward-looking statements, including statements regarding future results, unaudited and forward-looking financial information, as well as information about the company's future performance and or achievements. These statements are subject to known and unknown risks and uncertainties, which may cause our actual results, performance, or achievements to be materially different from any future results or performance expressed or implied on this conference call. You should not place any undue reliance on these forward-looking statements. For additional information, including a detailed discussion of the risk factors, please refer to the company's documents filed with the Securities and Exchange Commission, which can be accessed on our IR website. In addition, this call contains time-sensitive information accurate only as of the date of this live broadcast, May 8th 2026.

LENSAR undertakes no obligation to revise or otherwise update any forward-looking statements to reflect events or circumstances that may occur after the date of this live conference call. With that said, it's now my pleasure to turn the call over to our Chief Executive Officer, Nick Curtis. Nick.

Thank you, Lee, and good morning to everyone. Thank you for joining us today. Near the end of the 1st quarter, we turned the page, marking a new beginning for LENSAR as we exited the transaction-related holding pattern we are operating in for the past year and began to once again carve our own path as an independent organization. With the termination of the merger not happening mid-March, we spent most of quarter one in this state of limbo, and that state of being was reflected in our results for the quarter. In a positive light, the FTC position and deal termination validated we have the best technology in the market. Subsequently, we have made substantial progress since March 16th and look forward to expanding our global footprint, allowing more surgeons and their patients to experience the life-changing benefits of ALLY without the uncertainty of a pending transaction.

While our near-term financial and operational performance will no doubt be watched closely, it's important to understand that for the next several quarters, success won't be measured by any metric on our P&L, but rather by progress towards reestablishing the solid foundation and momentum for growth that we were building on prior to the announcement of the merger at the end of Q1 2025. We're returning to the fundamentals of growing new placements and the resulting recurring revenue in and outside the U.S. with purpose. It has been almost eight weeks since announcing the termination of the Alcon transaction, and the progress we've made in that short time gives us cause for optimism over what the future holds for LENSAR.

As I shared on our fourth quarter call, we continue to believe strongly in our ability to deliver value over the long term for all of our key stakeholders, including our surgeon partners in the U.S., international distributor partners. Let's not forget about the patients that our end user partners serve and ultimately our shareholders. In parallel with these efforts to complete this organizational and mind reset, we are working diligently to return to the level of growth we were enjoying pre-transaction. We're taking a matter of fact, business as usual approach with a very clear path forward and a keen focus on rebuilding momentum throughout the business. I'm pleased to share that we're making some great progress. We generated total revenue of $13.4 million in the quarter, which was down about 5% from $14.2 million a year ago.

That decline, however, was a result of lower system capital sales, down roughly $1.8 million year-over-year as opposed to the placement revenue. This was partially offset by increased procedure revenue driven by continued growth in global procedure volumes. One of the most important takeaways I'd like to highlight from this quarter's financial performance was the continued growth in our recurring revenue, which was up $1.1 million or 9% compared to the 1st quarter of 2025, representing 94% of our total revenue for Q1, 2026. We expect recurring revenue growth in two ways. The first is to increase as we begin again to expand the installed base of ALLYs. The second important initiative is to continue to leverage our existing installed base to grow recurring revenue driven by the materially industry-leading utilization rates of the ALLY System.

As system installations and base ramp back up, procedure-based recurring revenue will accelerate further. In the coming quarters, I look forward to tracking and updating you in this regard. We placed seven ALLY systems during the quarter, bringing our ALLY installed base to 205 systems approximately, with another 11 systems in backlog pending installation. The total installed base of ALLY and LLS systems reached approximately 440, up 12% compared to March 31st 2025. ALLY now accounts for nearly half of our global installed base, demonstrating the strong adoption we continue to see for our next-generation platform. It's important to recognize that this growth in the ALLY installed base has been achieved despite limited contribution from our OUS markets the past year.

As I pointed out on the last call, the initial ALLY launch outside the U.S. was very successful, but the momentum that we were building came to a halt just as quickly as it started, given the uncertainty over the post-acquisition business integration and ALLY distribution plan forward. While complexities around the go-forward commercial dynamic created a headwind for us, physician interest in ALLY and its numerous benefits have never subsided. Now that we and our distributors have clarity, I'm confident we can rebuild the strong international presence over time. While placement activity in the quarter was down, I want to draw attention to the more important story, which is the continued strength in the recurring revenue. We're reaching an inflection point where the size of our installed base is increasingly supportive of the recurring revenue growth, even during periods of slower system placements.

That represents materially a much stronger and more durable business model than the one we had in the early days of the ALLY launch. Procedure volume also continued to trend in the right direction. We performed approximately 54,000 procedures in the 1st quarter, up from about 52 last year and 39,000 in 2024. Our U.S. procedure market share at the end of the first quarter was 23.4%, consistent with reported market share on December 31st and expected given the fewer laser installations in Q4 2025 and Q1 2026, which generate share growth for LENSAR. I believe that we will get back to the recent trend of quarter-to-quarter market share gains moving forward as we continue to convert competitive system users and attract additional femto-naive surgeons into the ALLY ecosystem. My strong conviction is grounded in first-hand observations from the field.

LENSAR has maintained a presence at the key ophthalmology meetings, and with the knowledge that we will be moving forward as an independent company, our attendance at these key industry congresses is expected to return to pre-acquisition levels. While our booth at the ASCRS Annual Meeting last month in Washington, D.C. was smaller than we've had historically, it was no less productive. As you know, these meetings are planned months in advance, and we have precious little time or the opportunity to expand our footprint as an independent company following the decision to terminate the merger. Although we didn't have prime real estate in the exhibition hall, and overall meeting attendance was lower than previous conferences, booth traffic was incredibly high, which resulted in more than 50 system demos.

That's a great indicator of interest and engagement from potential surgeon partners and a very encouraging way to reinitiate LENSAR's presence at these important industry events. I'm really proud of what our team accomplished at the ASCRS, pulling it together with such professionalism and pride in a matter of weeks, and I look forward to a more visible presence at the upcoming major conferences. This conference was a bright spot, and everyone on the team is re-energized as the enthusiasm and interest in the benefits of ALLY was reaffirmed for our entire organization. While the workflow and practice efficiency benefits of ALLY are well-known throughout the community, we see a significant opportunity to continue building upon the robust body of clinical evidence supporting that ALLY enables surgeons to consistently deliver optimal outcomes for patients.

In the coming months, we'll have podium presence at several key industry congresses, with ALLY continuing to represent a leading voice in the ongoing clinical discourse around the benefits of laser-assisted cataract surgery to surgeons, their staff, and the patients that they serve. Before wrapping up my prepared remarks, I'd like to quickly share a recent interaction with one of our surgeon partners, a reflection, a perfect reflection of why we're so enthusiastic and optimistic by what the future holds for LENSAR. I've known this particular doctor for years. She was using a competitor's first-generation laser and struggling with the inefficiencies of that technology. She had reached a point where she was considering stopping laser-assisted cataract procedures altogether because she just couldn't justify the cost of premium surgeries for her patients, given the limited benefits she was realizing with this competitive system.

Her facility ultimately upgraded to an ALLY System and saw the difference almost immediately. Based on early experiences included not only improved efficiencies, but also the outcomes and extending to improving the patient experience in their cataract procedure. With ALLY, her perspective on laser-assisted cataract surgery changed completely, she is now recommending it to all of her patients. I spoke with the surgeon in a recent user's call that we had, the comment she made was quite telling. She said, "Nick, I will never do another premium procedure without using ALLY." For us, that really captures what this is really all about, delivering on the promise of our technology. ALLY isn't simply an incremental step forward. It improves the experience for all surgeons and their ability to optimize treatment for premium cataract patients.

The big players in our industry who thought they'd be eating our lunch are instead trying to catch up. We welcome their advancements, which no doubt bring greater attention to the market, and we look forward to not only maintaining, but also extending our technological lead. I'll now turn the call over to our CFO, Tom Staab, to cover the financial highlights for the quarter. Before doing so, I'd like to acknowledge that after today's call, Tom will be leaving us and going back to his biotech roots, as well as locating closer to his home. On behalf of the entire organization, I'd like to thank him for the six-plus years he served alongside me and the numerous contributions he's made to help us get to the point we're at today.

He's been a trusted colleague and a dear friend, and I wish him the very best as he starts his next chapter. Tom?

Thank you, Nick, for your kind words, and good morning, everybody. Before I begin, I'd like to thank the entire LENSAR team for six incredible years. It has been a rewarding experience launching ALLY and helping grow the company to its current state. With recurring revenue annualizing over $50 million and ALLY continuing to reign over all other inferior first-generation lasers, LENSAR's future is bright, and I leave the organization in a strong position to reclaim the success we experienced in 2024. I look forward to watching LENSAR build momentum and advance its mission of delivering next-generation care in refractive cataract surgery. With that, let me turn to a brief conversation of our financial results for the first quarter, and there are only a few items to discuss in greater detail.

Our total revenue for the 1st quarter of 2026 was $13.4 million compared with $14.2 million in the 1st quarter of 2025. The year-over-year decline was primarily due to lower system revenue, which was partially offset by continued growth in recurring revenue. System revenue was approximately $800,000 this quarter compared with $2.6 million in the prior year quarter, reflecting lower placement activity from our acquisition malaise Nick discussed earlier. Recurring revenue continued to be the bright spot in our performance, with total recurring revenue of $12.6 million, up 9% from the $11.5 million in the prior year quarter.

Gross margin for the first quarter was approximately $6.4 million, or 48% of revenue, compared to $7.1 million, or 50% in the first quarter of 2025. Our gross margin percentage is squarely in the range of 46% to 49% discussed in our fiscal 2025 results call, and as discussed then, reflects the higher cost of production associated with inflationary increase and tariffs that we have chosen not to pass on to our customers. Total operating expenses were $4.1 million compared with $12.9 million in the first quarter of last year.

Specifically, SG&A expenses declined significantly to $2.5 million from $11.1 million, primarily due to a credit of $4.4 million associated with unpaid acquisition costs that were eliminated or written off through concession of our acquisition advisors. When you exclude acquisition-related costs, SG&A costs were consistent at $6.9 million for both 1st quarters ending March 31st 2026 and 2025. Net income from the quarter was $36.3 million, or $1.56 per basic share, compared to a net loss of $27.3 million a year ago.

It's important to note that this quarter's net income was largely driven by non-cash items, including a $23.9 million gain related to the change in fair value of warrant liabilities, along with the recognition of a $10 million acquisition deposit into our other income in our first quarter results associated with the termination of the acquisition. This recognition did not increase our cash balance, as funds were already in our operating accounts, but funds were not owned by us until the acquisition termination. Moving on to adjusted EBITDA, which was negative $311,000 versus a positive $165,000 in the prior year quarter. We expect, upon achieving a rebound of our quarterly placements, to see our adjusted EBITDA will return to positive territory and thereby again generate cash from operations.

We ended the quarter with $13.5 million in cash equivalents, and investments. We continue to manage our liquidity carefully while we cautiously rebuild our business and keep ALLY as the premier robotic laser in the marketplace. That concludes my comments. Now I'd like to turn the call over to Jonathan. We look forward to answering your questions.

Thank you. Our first question for today comes from the line of Frank Takkinen from Lake Street Capital Markets. Your question, please.

Great. Thank you for taking the questions. Tom, wish you the best. Congrats on your transition. Was hoping to start with just an update on kind of current state of affairs. I know we've talked about a number of different things you're rebuilding, Nick, from internal on the U.S. side as well as OUS with distributors. Was just hoping to get a general update on how all of that is going and then the primary goal of kind of getting to when can the business get back to some of the prior growth rates we've seen, based on the progress you've made thus far.

Yeah. Thanks, Frank. Hope you're doing well today. Appreciate your question. You know, we've been doing exactly that. You and I had a chance to meet at ASCRS, and you know, we talked about some of this. I've been meeting with, and I've met individually with each of our distributors. You know, we're getting people back on board. I don't wanna say too much, but we have received purchase orders from our distributors, which is very positive because that indicates that they're getting back on track and have orders. We should ship some systems this quarter outside U.S., which will be the first time in about a year.

You know, optimistic about that and restarting that business. We've got some POs that'll take us, you know, into the fourth quarter as well here.

Yeah, I'm optimistic about that. Activity, you know, those 50 demos, and we did a conference call as well. We did like a Webex. We had, you know, about 77 participants on that Webex just to talk about LENSAR's going forward plan and strategy. The doctors couldn't have been more supportive of the company and our initiatives there. You know, peer-to-peer activity is very strong. We've got some conferences coming up this summer and, you know, I'd say that I'm pretty pleased with the activity that we've got and the increase in activity that we've seen in the U.S., you know, post-termination of the deal.

That's helpful. Maybe just to follow up on that, the distributor POs, is that something that's included in the backlog today, or was that post-quarter end?

That's post-quarter end.

Gotcha. Great. Perfect.

You know, it's gonna take us, you know, to very succinctly, it's gonna take us the next couple of quarters. You know, I really expect, you know, the next few quarters to be this, like, steady progress of rebuilding and improvement here. I think, you know, the really great story is that our recurring revenue is so strong and that it continues to grow. I feel that that's gonna continue. Now as we start adding additional placements, you know, I think really looking toward 2027 is gonna be really, really good for us.

Got it. Very helpful. Maybe just one more for Tom. Would be great to get a sense of how we should think about operating expenses at $6.9 million adjusted figure, how we should be thinking about that for quarters moving forward in 2026. If you could refresh us on kind of cash use expectations as we work through the transition and get back to growth and profitability.

Yeah, good question, Frank. You know, the easiest way to respond to your question is, you know, over the last 12 months, you know, we've kind of not rebuilt our human resource system. You know, some of our people have left thinking that the outcome was going to take the reins and went to other opportunities. Our SG&A expenses are actually going to increase now, you know, organically from the 6.9. Obviously, we had acquisition costs in there, and we won't have any of those going forward. You know, we need to build our service and customer application specialists as well as our regional sales representatives to support the growth that we're going to do. We're going to do it judiciously as we go forward.

I think the best way to look at this and, you know, as you reflect on the 4th quarter, our system placements were down, but it was simply because we had no placements in the first quarter outside the U.S. versus we had eight placements in the quarter of 1st quarter of 2025. That's a huge governor on our business when we were being so successful outside the U.S. As Nick's comments allude to, we're just getting those distributors back on board, and they're excited to get back on board, but it's not something that you just flip on a light switch. As we increase those number of sales, you know, we're going to devote that cash back to the business.

We are in a strong financial position right now, but we do have to be judicious in how quickly we build just because of the paying the transaction costs and because of getting the distributors back in the saddle. You know, the good news, as you compare the first quarters of 2025 to 2026 in the U.S., we actually increased placements in the U.S., and so that's a good thing. All indicators, as Nick mentioned, are that we are going to grow the business. It just may take a couple quarters for the distributors to get back on the horse and for the U.S. business based on the sales cycle to get back to where we were in 2024.

Got it. Very helpful. Thank you for taking the questions.

Thank you. Our next question comes from the line of Ryan Zimmerman from BTIG. Your question, please.

Oh, there we are. Hey, guys. How we doing? Tom, you know, great working with you these past few years and, you know, enjoy, being back in the Carolinas.

Thanks very much, Ryan.

You know, want to just, you know, kind of pick up off a number of things. You know, one of the things is, you know, if you go back to 1st quarter 2025, you guys had, you know, very strong procedure growth. It was a tough comp this quarter. Nick, can you talk about, you know, both the U.S., like parsed out the U.S. versus international procedure growth this quarter relative to maybe what you saw in 1st quarter 2025. You know, the second question is just, you know, I appreciate you're not giving guidance. This is a very unique dynamic in terms of kind of getting things going post the transaction.

You know, help us with some broad strokes about how you think about the pace of recovery, you know, as we think about both, you know, procedures and recurring revenue and system placements. again, I, again, I recognize the challenge of it, you know, how you see that playing out over the course of the year, I think would be helpful.

Hello? Can you hear me? I'm sorry.

Yeah. Now we can hear you. Sorry.

Oh, okay. Great. Thank you. Appreciate the thoughtful question here. Whether we've talked a little bit about this before, but I'll give a little color to it and how it relates to now. When we install a system, due to the training and the integration of the especially if they're moving it into the OR for the first time and, you know, learning, you know, how to do fully sterile procedures, so on and so forth with the system. We look at about 30 to 90 days to sort of depending on the account and their experience, and whether we have a fewer number of surgeons or a larger number of surgeons to get trained.

Obviously, it takes longer with a higher number, and it can be much more concentrated with a fewer number of surgeons that are performing the volume in any given facility. It takes 30 to 90 days to ramp up a system where they're doing productive procedure revenue, if you will. In current installed base, you should think about where we talk about the seven systems in the 1st quarter, 11 on backlog. Those systems will start to be installed. From the fourth quarter now, those systems are starting to produce in the way of paid systems. Recurring revenue kind of comes a little bit in waves from the growth side of it. New systems will bring completely fresh revenue.

Existing systems will grow, but will grow at a slower rate. What we see on average is as compared to a competitive device, on average, we perform, this is Market Scope data now, 27% higher procedure numbers on average than, and I alluded to this in my remarks, than a competitive system that's been installed. We see about an 11% increase if we're upgrading from an LLS to an ALLY as well, somewhere around 11% increase in procedures. Take the new systems and project those out 30 to 90 days from the revenue increase perspective. As we start to get more placements into the field, that recurring revenue begins to grow a little more exponentially.

That's why I'm being very cautious about the next two quarters, because we're just getting back to the point where now people know who they're dealing with. They're, you know, getting back to that decision-making relating to installing of the systems. You know, 27% increase over competitive devices, on average, and about an 11% on upgrades. Cataract volumes in 2025 and heading into 2026 were somewhat flat in overall cataract volumes. Subsequently, as you see, just with the larger companies that are selling the premium lenses, if they haven't taken market share from one of the other companies, you see fairly flat numbers from them.

We're actually doing, you know, pretty well from a, from a procedure and integration perspective once we get it. Don't forget that little bit of a lag. In OUS, where we recognize revenue immediately upon selling of a system when it leaves LENSAR, different than revenue recognition in the U.S. As we see some systems go there, we'll recognize revenue immediately on that, but a similar time on the ramp-up of procedures there as well to what you see here. Procedure numbers have been pretty strong outside U.S., which actually has been a pleasant surprise with the existing systems that are in. As we start getting more systems out there, I'd expect to get a little bump there too.

That's very helpful, Nick. You know, if we go back, and this goes back, you know, even when you guys came out of PDL BioPharma, you know, the, the intent of the system was to do a combined femto and phaco, right?

Yeah.

You know, we lived through the early dynamics with FDA, et cetera. But now as you guys kind of, you know, refocus the company, you know, what is your thoughts around the ALLY technology itself? I mean, what do you wanna do with it? What enhancements do you wanna make? You know, what's the, you know, kind of pipeline, you know, roadmap, if you will? 'Cause we know that the market will get more competitive. There are some companies developing, you know, new FLACS systems over time here. How do you sustain this momentum and advantage over time, technologically speaking?

Yes. I love this question because this is really, I feel, especially as an independent company, this is really important for us on a going forward basis, right? Because now we're getting some critical mass, and I talked about that in my remarks as far as the procedures are concerned. There are several applications that we're looking at, enhancing the ALLY device. You know, all of this was kind of put on hold during the transaction because we didn't really know what the acquiring party was gonna do or not wanna do or what was gonna be important.

Now to be able to restart that and from a LENSAR position, I would say that, you know, I'm gonna talk about some of this at the upcoming meeting, at the AECOS meeting in Madrid. You know, I would say that the it's probably pretty obvious that we would start looking at something like flaps and looking at some other corneal procedures. I won't get too specific about that. I wanna be able to make an announcement to talk to surgeons about some of those things when I present. You know, with the system having the capability it does with the dual-pulse laser, we certainly have the capability of doing more in the cornea than what you've seen to date.

The other thing is that since we have, you know, the makings of a robotic technology here, you'll see us move towards more robotic function, continued enhancement, robotic function of the device. Suffice to say that one area that we could look at very closely, I will talk more specifically about this as we go forward, would be in terms of some of the docking, and the docking of the PID to make that more automated and to make it less surgeon-dependent, but surgeon-guided as we go forward there. On the phaco side, I remain open-minded because we have very strong intellectual property around the integration of the phaco device. You know, we'll see what's best.

Obviously, it's highly unlikely that LENSAR is gonna take the time or the resource to develop a phaco. That's not gonna happen. Would we revisit the integration? Depends on market dynamics and what, you know, sort of what a deal would look like for us.

Okay. Last one for me.

Ryan.

Oh, go ahead, Tom. Sorry.

I was just gonna address your procedure question, which is when you look at the procedure growth, in the quarter, it is solely related to U.S. activity. Nick and I can't I guess we can't emphasize enough that, you know, when the acquisition was announced, there was a slow turnoff of our distributor activity. You see that in not only procedure volume, but more importantly in placements. Right now-

Right

The U.S. business is still going, you know, still doing pretty well. Outside the United States, you're kind of like a flat line up until the activity that Nick just mentioned.

Tom, I think it's important to call out that in the 52,347 from 1Q 2025, there is procedure volume outside the U.S. in that comp, right?

Exactly. Yes.

Yeah. You're comping a U.S. number against both a U.S. and OUS number, just to be clear.

No, no, what I'm saying is the increase is solely associated with the United States as you're comparing those numbers, and that the procedure volume, outside the United States was effectively flat.

Right

from Q1 of 2025.

Okay. Yeah, I can take that offline. Just last one for me, Nick. I mean, you know, with Alcon, you know, terminating the agreement, they have this significant LenSx installed base now. I'm curious, given, you know, how old that technology is these days, what the response has been from the Alcon users, you know, who are sitting on these older LenSx systems and, you know, for you guys, does that, you know, represent meaningful opportunity because, you know, they thought maybe they would, you know, there was a pathway to get to LENSAR or to get to ALLY, I should say. Excuse me. I'm just curious kind of, you know, what you're hearing from those users or that segment of the market.

Yeah. That's a really good question. You know, there is no doubt that it is delaying, you know, surgeons' decisions. I like an analogy that's really simple, you know, like when do you buy a new car? When people evaluate when they're getting a new car, they many times will try to drive the car that they've got until they simply, you know, their maintenance bills get high. They just don't wanna continue to deal with what they're dealing with their older vehicle. I think that's kind of where we're getting to, I believe we're gonna get to an inflection point.

I don't wanna get ahead of myself here, but we're looking at, you know, certain multi-system opportunities that have older technology and specifically in cases the LenSx installed. You know, I think people need to come to their own realization that, you know, despite a vast portfolio of product, arguably that product is old and is getting towards the end of its useful life. I'm looking forward to continuing to, you know, go after those systems. We're pretty disciplined, though, you know, because it won't be at any cost. You know, we're pretty disciplined about our pricing and we're creative about how we can put a deal together, which is one of the nice things about having this it be the only product that we deal with.

At a certain point, you know, from a pricing perspective, we bring way more efficiency. The doctor can do many more cases in a day than they can do with any of the other devices. You know, I'm talking about full treatments. They can save time for their patients. They can save time for themselves. That allows them to do additional premium procedures that bring in a premium of revenue for them as well and higher EBITDA for them and their practices, and particularly with the PE groups. We shouldn't have to compete on a price basis. You know, because we bring higher benefits.

There's a fine line there between the incumbent using all of their resources to try to keep the incumbent in place versus at what time will they switch. It's not if, it's when.

Thanks, Nick.

Thank you. This does conclude the question and answer session of today's program. I'd like to hand the program back to Nick Curtis for any further remarks.

I really appreciate everybody joining the call today, and even more so your continued interest in LENSAR. I look forward to updating you as we continue to make further progress throughout the year, and look forward to our next call.

Thank you, ladies and gentlemen, for your participation in today's conference. This does conclude the program. You may now disconnect. Good day.

As a reminder, this conference call will be recorded. I would now like to turn the call over to Lee Roth, President of Burns McClellan, investor relations advisor to LENSAR. Mr. Roth, please go ahead.

Thanks, Josh. Once again, good morning, everyone, and welcome to the LENSAR fourth quarter and full year 2025 financial results and strategic update conference call. Earlier this morning, the company issued a press release providing an overview of its financial results for the fourth quarter of 2025. This release is available on the investor relations section of the company's website at www.lensar.com. Joining me on the call today is Nick Curtis, Chief Executive Officer, and Tom Staab, Chief Financial Officer of LENSAR, who will provide an overview of recent developments, our go-forward strategy, and our Q4 financial results. Following these prepared remarks, we'll turn the call back over to the operator to answer your questions.

Before we begin, I'd like to remind you all that today's conference call will contain forward-looking statements, including statements regarding our future results, unaudited and forward-looking financial information, as well as information on the company's future performance and/or achievements. These statements are subject to known and unknown risks or uncertainties, which may cause our actual results, performance, or achievements to be materially different from any future results or performance expressed or implied on this call. We caution you not to place any undue reliance on these forward-looking statements. For additional information, including a detailed discussion of the risk factors, please refer to our documents filed with the Securities and Exchange Commission, which can be accessed on the website. In addition, this call contains time-sensitive information accurate only as of the date of this live broadcast, March 31st, 2026.

LENSAR undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this live call. With that said, it's now my pleasure to turn the call over to Nick Curtis, Chief Executive Officer of LENSAR. Nick?

Thank you, Lee. Good morning, everyone. I appreciate you joining us today. It is no doubt an understatement to say 2025 was a unique and unprecedented year for LENSAR. We take great satisfaction knowing that the leading eye care company in the world, Alcon, publicly recognized the value of ALLY and LENSAR, given the joint acquisition announcement made in March of 2025. This validates our statement that ALLY is the best next-generation technology, delivering significant and relevant performance improvements in each of the critical elements of laser-assisted cataract surgery, including advanced ergonomics, efficiencies, imaging, and automated treatment planning with a dual modality laser. ALLY is the only system that employs machine learning and compute power during treatment planning and optimized treatment to deliver outcomes that are better than any first-generation competitor.

The termination of the acquisition agreement was a mutual pragmatic decision made after a year of focused effort and considerable expense from both sides. While this acquisition was approved overwhelmingly by our stockholders, ultimately, we made the decision to terminate because the Federal Trade Commission would seek to enjoin the merger. While both parties worked towards offering acceptable accommodation to allow it to close, it became clear the FTC was not open to changing their position. We were disappointed in the outcome. However, the upside of this process is the validation of the ALLY Robotic Cataract Laser System superiority compared to all other first-generation lasers available today, as well as the value attributed to LENSAR based on the success the product has achieved since its launch and its future potential.

Therefore, with new resolve and new purpose, we're excited to emerge and reengage as an independent company, picking up where we left off 12 months ago. We've spent the last two weeks working on initiatives and jump-starting relationships with key stakeholders. I'll briefly discuss the last two weeks and share our high-level go-forward strategy today. Relationships are important, and before I present our strategy, I would like to take a minute to thank our partner vendors, agents, and suppliers who not only provided excellent support and counsel, ultimately shared that disappointment and financial burden with us through granting reductions in fees as well as extended payment terms. These partnerships are beneficial to LENSAR in returning to our prior operating cadence, allocating more of our financial resources and attention to operations.

We can immediately start getting back to our business as usual and smooth return to focusing on growth and expanding our presence with increased installed base and procedures. We appreciate their collaboration and contribution to our future success. Additionally, in association with the termination of the acquisition, we received the $10 million transaction deposit that had been in escrow. In the last three quarters of 2025, we operated with an increasing degree of uncertainty among our partner customers, potential partner customers, and distributors regarding our future and the timing of the close of the acquisition. Despite the uncertainty that delayed U.S. customer decision-making on ALLY and LENSAR and halted OUS distributor activities and purchasing systems, we expanded the ALLY installed base by nearly 50% compared to year-end 2024, while achieving 20%+ year-over-year growth in procedure volume for both the fourth quarter and full year 2025.

There's no question the last nine months of 2025 were negatively impacted by the acquisition process and extended timeline, and not just by the increased SG&A expenses associated with supporting the transaction. While our 2025 results include a 9% revenue growth, I need to be transparent and clear. We expect through the next several quarters of 2026, a gradual return to our historical operating performance. When you consider our longer-term growth metrics, the trajectory has been impressive. Our full year 2025 procedure volumes are up 50% compared to 2023, the first full year of Ally commercial availability. By reflecting on a longer-term vantage point, you get a much better picture of what we see as the future opportunity for LENSAR and ALLY.

Since the launch in August of 2022, we grew our installed base to approximately 200 ALLY systems and grew our procedure volume, gaining market share from 14% procedure share in the U.S. to 23.4% as of the end of 2025. I wanna say we gained almost 9.5% of market share points in 3.5 years. These market share gains come from three specific areas. First, it comes from competitive accounts, replacing first-generation lasers with our ALLY Robotic Cataract Laser System accounts for the largest gain in share. Second, the gain in share is demonstrated by what happens after we replace a competitive system. LENSAR, on average, performs 27% more procedures annually than the national average per laser, providing evidence that we are growing the overall market for robotic laser cataract procedures.

Third, nearly 50% of our systems in Q4 2025 were from femto-naive surgeons, further expanding the market for laser-assisted cataract surgery. The data provides evidence LENSAR is addressing the shortcomings of the first generation laser-assisted cataract surgical lasers by delivering the most technologically advanced next generation robotic laser for cataract surgery in multiple ways, significantly improving efficiencies and patient throughput, allowing for more procedures with faster treatments and fewer staff interactions, leading to the potential for fewer mistakes, less anxiety, and a better overall patient experience. Second, customizing precise, specific, reproducible treatments optimized by utilizing features such as machine learning and surface anatomy recognition, imaging, and optimizing data for treatments by communicating with preoperative devices in the surgeon offices, leading to better outcomes in refractive cataract surgery using astigmatism management.

To put in perspective, our competitors have the ability to bundle more products using cataract procedures, more feet on the street, and much deeper financial human and operational resources. Despite this, we've been incredibly successful in increasingly growing ALLY's market share. Why? LENSAR is a small, nimble, and resilient organization. We're known for innovation that aligns with surgeons' practices and patients' objectives. LENSAR is and always will be a surgeon and practice-centric organization. We have extensive clinical evidence that is giving surgeons the confidence to make the decision to implement ALLY in their practice. Over the last three years, ALLY's performance, placements, and procedure volume speaks for itself. All I can say as we start the second quarter of 2026, we expect to compete as we have in the past. Listen here, we're back. I'd like to spend a few moments talking about our business outside the United States.

As a reminder, while LENSAR started commercializing ALLY in the U.S. in August of 2022, it wasn't until two years later that we received the European certification and began to sell ALLY internationally. Looking at the timeline, ALLY had been on the market outside the United States for roughly seven months when the transaction was announced. The uncertainty over the post-acquisition ALLY distribution landscape had a greater impact on our outside United States distributors than our U.S. customers, and that uncertainty caused a meaningful slowdown in our international business expansion over the last year. With our distributors, the ALLY launch got off to a very successful start, quickly gaining acceptance with new sites and meaningful momentum, which came to a hard stop. After meeting with the distributors post-acquisition termination announcement, I believe we'll begin to return to significant system growth in these international markets over time.

Most, if not all, the distributors were both happy and relieved with the termination of the merger. Although they have all indicated their enthusiasm and are ready to support the business going forward, their conservative immediate forecasts indicate this will take some time. We will work together on the transition timing to regain the lost momentum and begin to contribute to an increase in worldwide system and procedure market share. I'm confident in our ability to drive long-term success and create value for our surgeon partners in the United States, our distribution partners overseas, our global customers, the patients they serve, and our shareholders. We also continue to rely on our long-term existing physician partners and private equity groups as they are our partners in success. These partners recognize we are working hard to deliver and provide the most responsive service, support, and best product in the market.

Going forward, we'll be focusing on a few key areas. Continuing to grow our procedure volumes and recurring revenue will be critical to our success. This will come through a combination of additional system placements and increased utilization on the 200 ALLY systems currently in the field. Our procedure revenue is recurring in nature. It is stable, it has a predictable trajectory following an install, and importantly, carries a significantly higher margin than system revenue. The acceleration of system growth discussed in my remarks will contribute to significant long-term growth in procedure volumes, which will further strengthen our recurring revenue base. An important statistic to consider here is system utilization rates, another area where we are well-positioned for success in driving overall market growth. Once again, LENSAR systems in the U.S. perform an average of 27% more procedures than the national annual average of lasers currently installed.

There is not another robotic femtosecond laser available in the marketplace. We're excited to speak with you, answer your questions, and we appreciate the confidence and support you put into the LENSAR team. Now let me turn the call over to Tom, and he'll cover our financial highlights for the quarter. Tom?

Thank you, Nick. I'd like to discuss our fourth quarter and fiscal 2025 results. However, my remarks will be succinct and poignant for two reasons. One, our fourth quarter and 2025 results were impacted by conducting our operations under the previously contemplated acquisition by Alcon. Two, we start the second quarter as a standalone company tomorrow. I'll highlight the relevant aspects of Q4 and our 2025 results as they relate to our future results and operations. In association with the termination of the merger, there are some significant adjustments to our future financial statements that I'd like to highlight. First, the $10 million merger deposit that was being held in our bank account becomes ours.

Thus, the cash that we report at December 31st of $18 million is ours with full title, and the $10 million deposit liability will be eliminated in our first quarter 2026 results. Second, we recorded $17.1 million in total acquisition costs in 2025, with $14 million of those expenses unpaid as of December 31st. With the termination of the merger, approximately $4.3 million of the unpaid balance will be eliminated or written off by concession of our acquisition advisors, and then $5 million of the remaining liability will be payable starting in May 2027, a significant payment deferral.

Lastly, and importantly, as Nick has mentioned, we have re-engaged with our key stakeholders, including our distributors, and we start today with the help of these key stakeholders to reestablish our standalone operations at an operating cadence more similar to prior to the announcement of our acquisition. Our performance in the fourth quarter was solid, with a total revenue of $16 million, representing a 4% decline year-over-year, primarily as a result of lower system sales. As you look at regional sales, U.S. ALLY sales were 12 systems, increasing one system from Q4 2024. However, there was only one ALLY sale outside the United States in the fourth quarter of 2025, compared to 10 ALLY systems sold outside the United States in the fourth quarter of 2024.

We attribute the fluctuation in ALLY unit sales year-over-year largely due to our distributors' uncertainty as to when their collaboration with ALLY and LENSAR would end. You can understand our excitement as initial conversations with distributors demonstrated their willingness and enthusiasm to reengage. This will be an important growth driver to top-line revenue, recurring revenue, as well as enhanced cash flow. The quicker our distributors reach out to potential ALLY customers and reengage in ALLY's promotion, the faster our operations outside the United States begin to meaningfully contribute to our total system sales and enhance our cash flow. Another important aspect of our business is recurring revenue. While total 2025 revenue increased a respectable 9% over 2024, 2025 recurring revenue increased 15% over 2024, offsetting the decrease in system sales for the year.

The decrease in system sales for 2025 was entirely due to sales outside the United States, decreasing to 20 systems in 2025 from 23 systems in 2024. This is especially noteworthy as eight systems, 40% of our fiscal 2025 system sales, occurred in the first quarter of 2025 prior to the acquisition announcement. The comparable 2024 period, as Nick mentioned, was only five months of activity as we did not receive regulatory approval and launch in Europe and Taiwan until August 2024. Recurring revenue grew 17% in the fourth quarter 2025 to $12.7 million, annualizing to over $50 million, and we exited the full year 2025 at $46.3 million, up 15% compared to the $40.1 million in 2024.

This performance reflects the continued expansion of our installed base as well as increased system utilization with procedure volume remaining a key driver. Fourth quarter procedure volume increased approximately 20% year-over-year, and full year procedures grew 22%, surpassing 206,000 globally. We placed 15 ALLY systems in the fourth quarter, bringing the installed base to just over 200 ALLY systems, up 48% year-over-year, while our total combined installed base of ALLY and LLS systems grew to approximately 435, an increase of 13%. We exited 2025 with a backlog of 13 systems pending installation. Gross margin for the quarter was $6.9 million and represented a gross margin percentage of 43% compared to a 42% gross margin in the fourth quarter of 2024.

Our gross margin for the full year was 46% versus 48% for fiscal 2024. The decline in margin percentage represents the impact of inflationary cost increases to our raw materials and production process, accompanied by tariffs assessed in 2025. We did not pass on tariff costs to our customers. We are forecasting an increase in our gross margin percentage and expect it to be in the 46%-49% range for fiscal 2026. The more successful we are with system sales, the lower we will be in this gross margin range. However, increased system sales will have a more beneficial impact on our recurring revenue as gross margin percentage and recurring revenue factors are inversely correlated when it comes to ALLY sales.

Other than the recurring revenue, another important aspect of our 2025 results is that we maintained a positive adjusted EBITDA for the year with a fourth quarter adjusted EBITDA of $595,000, thereby indicating operating cash flow positive operations excluding any working capital impact. We are proud of our positive adjusted EBITDA operations for the year, considering we operated 9+ months under the pending acquisition, and during that period, we were missing top-line revenue and cash flow from our typical system sales outside the United States. From an expense perspective, our fourth quarter results were impacted by approximately $3.5 million in merger-related costs, which drove a 51% increase in SG&A year-over-year to $10.3 million, and a 41% increase in total operating expenses to $11.9 million in the fourth quarter.

Going forward, we expect that the underlying expense profile of the business will become more stable with our cash-based operating expenses being a reasonable guide for 2026, with us expecting no more than a 10% increase in cash-based operating expenses and the majority of this increase devoted to commercial activities. As we look ahead, our focus is on transitioning from this 12-month period of disruption to one of execution and growth with three clear priorities. First, accelerating revenue growth. We expect continued expansion of our installed base and increasing system utilization, thereby increasing recurring revenue. Second, maintaining our cost discipline. This priority continues and has been a focus since launching ALLY. Third, enhancing cash flow, especially as it relates to increasing system sales, particularly outside the United States.

We believe that the combination of cash on hand as well as the discounted and extended payment terms of acquisition costs provide us with the necessary flexibility and financial resources to effectively restart our operations and return to our previous growth run rate and operating success. We will now like to turn the call over to Josh for Q&A. We're happy to answer your questions.

Thank you. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. One moment for questions. Our first question comes from Frank Takkinen with Lake Street Capital Markets. You may proceed.

Great. Thank you for taking the questions. A lot to cover. Maybe I'll start with the distributor commentary. Nick, it sounds like the conversations you've had over the last few weeks have been really positive, but I did hear the comment of exercising a little conservatism as you re-engage with those folks and think about kind of how that's gonna actually translate to OUS system revenues. What more can you tell us there, and how should we be thinking about reading into that commentary and applying it to our models as we think about growth re-accelerating throughout 2026 or 2027?

Sure. Hey, Frank. Good to hear from you. It's been a while since we've done these calls. The business outside U.S., you know, is different in a lot of cases, particularly in a few of the countries where you don't have as many private practice and let's say, ambulatory surgery center owners where they can make the decision or a private equity group that makes the decision. For example, in Germany, where we have a large private equity group, and we are, you know, one of the primary suppliers there. In some of the, particularly Southeast Asia, some of these go on tenders. Given the uncertainty, they were hesitant to engage in a tender because they're over an extended period of time.

For example, they'll start re-engaging in these tenders, and those tenders take time. Quite frankly, we may have lost a few renewals in the short term, you know, from some of these deals, not our deals where they had our systems, but where we had an opportunity to, let's say, quickly replace a competitive system. I just expect that it's gonna take us, you know, several quarters to really reinvigorate, get out and assess where some of those tenders are, where we have opportunities, and begin to do that, as well as participating in some of the various conferences like we do here.

I just caution to say that we had this massive quick start when we got the ALLY approved two years later. Now essentially there's been zero activity for the last nine months. There'll be some restart up, and it's not like there's a backlog sitting there because essentially these distributors were planning for life without LENSAR that they didn't expect to be distributing on a going-forward basis. They're really enthused, and I just say it's gonna take us a little time to get back to that sort of momentum that we had in the last quarter of 2024.

Yep, very helpful. To me, it seems like there's two phenomena going on. OUS likely more capital placement oriented, and then in the U.S. with each incremental placement gets incrementally harder. Maybe there's less upfront payment and more kind of lease-based placements. How should we think about that throughout the year and a mix of maybe kind of more lease-based or usage-based placements versus actual capital sales throughout the year?

Great question. As you know, and as Tom had indicated, when we sell a system outside the U.S., when it leaves our dock, we essentially recognize revenue on the system sale itself, and it's a very quick recognition. In the U.S., the revenue recognition is different. You have to get the system installed, you have to begin training, and the system is accepted by the customer, the end user, before you begin to recognize revenue.

On procedure deals or when we do placements and really even when we sell a system in the U.S., usually you're looking at in the neighborhood of close to 60 days before, you know, before you really start getting into the revenue phase that, you know, to get to some normal procedure volume because you're training people and you're, you know, you're getting the systems put in place and procedures and whatnot. Traditionally, we've been in the neighborhood of somewhere north of 50% sold systems in the U.S. and let's say, you know, 50/50 or perhaps even a little bit more on the sold versus the placed. I would expect that that's probably gonna drop a little bit.

What we've seen is that the competition, you know, they lack the system. They go out with procedures and they try to drive, you know, a price competitive versus, you know, what we do with a value proposition, which a much more efficient, faster, better treatment overall. I think that over the next couple quarters, you'll see us go from that sort of 50%-55% sales sold systems versus placed systems in the U.S. to a lower percentage, particularly as OUS takes a little time to sort of ramp up there. Does that help you in terms of the percentage?

Yeah. No, that's very helpful. Appreciate that. Maybe just the last one, for Tom. I heard the comment, 10% increase in cash OpEx. I just wanna make sure I understand that. Essentially, if we look at 2025 OpEx and back out the $17.1 million of M&A-related expense, and then grow that 10%, is that what you're inferring? You would be in the neighborhood of kind of $38 million-$39 million of operating expense for 2026.

That, that's exactly right, Frank. The only thing that I'll say is the way we look at things is cash-based operating expenses. We throw out, you know, sort of amortization as well as stock-based comp, and then it's the 10% off that base. Yes, you're correct.

Okay. Perfect. Thank you, guys.

Thank you. Our next question comes from Ryan Zimmerman with BTIG. You may proceed.

Hey, guys. Thanks for taking the questions. Maybe just to start, I don't think I heard the procedure growth was still really good, you know, worldwide. I'm wondering if you could comment, Nick, on U.S. procedure growth, 'cause I think you also face a tougher comp there. We saw a bit of a slowdown in cataract volumes, you know, through much of 2025. Maybe just comment on kinda, you know, where that stands. You know, as you think about the business going forward, I appreciate that the system dynamics will be choppy as, you know, you kinda get the train out of the station. Talk to us about the recurring revenue side of things, particularly around procedures and how you think that will, you know, kind of function as we look ahead to 2026.

Yeah, thanks. Good to hear from you, Ryan. Appreciate your questions. As Tom had mentioned, we exited the year with $46 million, approximately $46 million in recurring revenue, and that was ramping closer to $50 million when you look at the fourth quarter and on a rolling forward basis. Well, really, our business is becoming very healthy on the recurring revenue side. It was 79% of our revenue in the fourth quarter. As we go forward, we expect that those 200 installed systems will continue to produce. We're doing approximately 600 procedures a year or so on average on the ALLY units in the U.S. on a going-forward basis on average.

That's quite a bit higher than what the average installed base is. We expect that's actually going to continue. Because of what we do with astigmatism management, we started to see more femtosecond laser naive, we refer to as femto-naive, which represented 50% of our new business in the fourth quarter. We expect that to continue and to continue to grow as well. Now those accounts, a caution, take a little bit longer to ramp because they've never done lasers before, and they're, you know, putting in a new system, and they're getting trained, and they have to train staff and educate patients and whatnot.

You know, that will take us a quarter, two quarters to get those folks sort of up to speed as more new customers come on. Representing a pretty large segment in a lot of particularly when you look at cataract surgery reimbursements and the need to deliver better outcomes, our astigmatism management, you know, over 65% of procedures that we do involve some form of astigmatism management. I think you'll see the mix of customers that heretofore are replacing older competitive devices. On average, you know, we do 27% more procedures than the national average of systems. We take about a 60-day ramp, and you see those procedures coming up to where our averages are, or more.

You'll see a mix of newer customers and maybe some of the office-based surgery centers, which is trending, moving into office-based suites, where those are lower volume accounts, take a little more time. You may see the average number of procedures drop slightly, but you'll see more systems doing those and whereas the current install base will continue to grow.

Okay. Very helpful. You know, just to circle back, Tom, on expenses. I appreciate the math and commentary that you gave. It's very helpful. But I guess my question is, you know, in this transitory period, I imagine, you know, expenses came down artificially. You know, now you do also need to, you know, kind of, again, get the train out the station, if you will. So, you know, when you think about kind of the cadence of expenses and appreciating kind of where it's going, you know, shouldn't we see some type of kind of acceleration, you know, foot on the gas pedal, if you will, to, you know, get things, you know, get kind of operation humming again?

I'm just wondering, you know, if the 10% is the right number, as I think about, you know, kind of into 2027 and beyond, I guess. You know, I know it's a little premature, but, it just seems like there's, you know, kind of multiple vectors here, you know, cross-currents around operating expenses, for 2026.

Very astute question and a very good observation, Ryan. I mean, yes, you know, our expenses did go down over the last 13 months just because of being under the acquisition process. Even though our advisors discounted and extended the payment terms, you know, that's still a big nut for us to cover as a small company. We're being very judicious in our expenses, and the increases are all gonna be commercial for the most part in 2026. As our distributors come online and we see a larger contribution of sales outside the United States and more cash flow coming in, I fully envision ramping up our commercial activities in 2027 well beyond 10%. We're kind of, you know, in this moderation phase until we're certain on how quickly our distributors can come back after this 13-month lag where they effectively put their pencils down.

Right. No, understood. When you think about kind of what's entailed, and this is more directed at Nick, I guess, like, you know, yes, you've had conversations with the distributors outside the U.S. You know, they understand, you know, where you guys are at as a company now, you know, not going through with the merger. Does your thinking around, you know, your OUS efforts, you know, change? Does it? You know, do you see bigger opportunities than maybe you thought about before? You know, is there room to go beyond kind of the markets that you were in, you know, kind of pre-merger? You know, some of those approvals were really good. We saw a really good uptake in Europe. Now the question is, you know, as a standalone, you know, does your aperture change, I guess, you know, particularly outside the U.S.?

Yeah. A really great question. You're starting to delve a little bit into some strategy here. I've seen, it's really interesting because in terms of especially replacing some of the older systems from competition that are out there. I've seen some interest in a few other countries that we have not gone into. I'm gonna be looking at a few opportunities such as Australia and New Zealand in particular, where there's actually quite a bit of interest in replacement of older systems there. That would be one market that we haven't been into that we may look into. I think that we'll see in Southeast Asia our activity come back there.

Like I said, there's more of a tender business there, and so it's gonna take us a little more time. Where I see there'll be some systems there this year, but I think that really as we get into 2027 into, you know, first, second quarter of 2027, we'll see quite a bit more growth in that Southeast Asia market. I think there's a lot more expansion growth in Europe into countries where heretofore we haven't been in. Because again, not to underemphasize or overemphasize, you know, ALLY addresses a lot of the shortcomings as to the reasons why people abandon, you know, femtosecond laser-assisted cataract surgery before.

Because we have this good install base in the U.S. and our business is growing, it's almost been an advantage getting the approvals later outside the U.S. because it's helpful for the distributors where they see that there's uptake here in the replacement of competitive devices. There's a lot of systems outside the U.S. where they're sitting in accounts that are just not very productive, and I feel like, you know, competitive systems. We'll have some opportunity there. I don't see the opportunity coming back in South Korea anytime soon. As you know, they've got big issues around reimbursement and insurance company reimbursement there, but that's been away from us for quite a while, so it doesn't impact our business negatively or positively, if you will.

I think we probably need to look at some other markets in South America, Latin America, where heretofore we haven't been either. I think now.

Yeah.

You know, we can address some of these things. Those are longer term, you know. I think we'll see Europe come back, and we'll have some opportunity outside of Germany that we hadn't really gone after before. I think our distributors are interested in doing that, and we've made some additional relationships there. I think we'll see Southeast Asia, in various countries there we do business come back strong, and then we'll look at a few of these other markets.

Okay. I appreciate it. I know this, you know, again, this call was a maybe change in plan from what everyone expected, but it's good to hear from you guys and, you know, we'll get the dust off and move forward.

Hey, Ryan, you know what? It's, it's, that's life, and life throws you curves and the reality is it's what you do to adjust and how you pivot and how you decide-

Right.

to move from there. You've got two choices. You can quit, or you can come out fighting. I've never quit and I have to come out fighting, so.

Very nice. Thank you, guys.

Thank you. I would now like to turn the call back over to Nick Curtis for any closing remarks.

I really appreciate everyone joining us today. It's been invigorating to do a call after not having a call for about a year now. While the termination of the merger was not the outcome that we anticipated, I think it really positions us to the positive there as it positions us to move forward with a much greater focus and control as an independent company. As a standalone company, we certainly know we have the best product available. I think it came out loud and clear through the process here, and we're ready to capitalize on the significant market opportunities that lie ahead. Rebuilding momentum is gonna take several quarters, but our priorities are very clear, and I believe our team is aligned to deliver.

We're confident that on the path, it really is enabling us to unlock even greater long-term value for our surgeons, patients, and shareholders. We look forward to sharing our progress with you all as we move forward. In closing, I just wanna say once again, LENSAR is back. Thank you.

Thank you. This concludes the conference. Thank you for your participation. You may now disconnect.