QTI

Day, and welcome to the QT Imaging Holdings First Quarter 2026 financial results conference call. I would now like to turn the conference over to Bruce Voss. Please go ahead.

This is Bruce Voss with Alliance Advisors IR. Thank you for participating in today's call. Joining me from QT Imaging Holdings are Dr. Raluca Dinu, Chief Executive Officer, and Jay Jennings, Chief Financial Officer. I would like to remind listeners that comments made during this call by management will include forward-looking statements within the meaning of federal securities laws. Any statements that are not statements of historical facts should be deemed to be forward-looking statements. Such statements involve known and unknown risks, uncertainties, and other factors that may cause actual results, performance, or achievements to be materially different from those implied by such statements.

All forward-looking statements are based on QT Imaging's current beliefs as well as assumptions made by and information currently available to QT Imaging and relate to, among other things, QT Imaging's Breast Acoustic CT, including its product commercialization and manufacturing, the evolution of QT Imaging into a scalable imaging platform, the QTI Cloud Platform and SaaS model, performance of software enhancements, new product development and introduction, and product sales growth and projected revenues. For a list and description of the risks and uncertainties associated with the company's business, please see its filings with the Securities and Exchange Commission. Furthermore, the content of this call contains information that is accurate only as of the date of the live broadcast, May 13th, 2026.

QT Imaging disclaims any obligation, except as required by law, to update or revise any financial or operational projections or other forward-looking statements, whether because of new information, future events, or otherwise. Now I'd like to turn the call over to Dr. Raluca Dinu. Raluca.

Thank you, Bruce. Good afternoon, everyone. Thank you for spending the time with us and for your interest in QT Imaging. The first quarter of 2026 was a highly productive period for QT Imaging as we continued to execute across commercialization, clinical validation, reimbursement, regulatory expansion, and software innovation. We believe that the progress achieved during the quarter further strengthens the foundation for the long-term adoption of our technology and supports our strategy of building a leading quantitative breast imaging platform. During the quarter, we shipped 13 QT Breast Acoustic CT systems, which was in line with our commercial distribution commitments. These shipments reflect continued operational execution and growing commercial activity as we expand our installed base both domestically and internationally.

We're also pleased to announce that subsequent to the close of the quarter, the maturity date of our senior secured term loan with Lynrock Lake was extended by two years from March 31st, 2027 to March 31st, 2029. We would like to thank Lynrock Lake for their continued support and confidence in QT Imaging. This extension provides the company with additional financial flexibility as we continue executing on our commercial, clinical, and strategic growth initiatives. On the reimbursement front, we achieved an important milestone with the approval by the American Medical Association of a new Category III CPT code for our technology effective January 1st, 2027. We believe this is a meaningful step toward broader clinical adoption, standardized reporting, utilization tracking, and future reimbursement pathways for our technology.

We also received FDA 510K clearance for enhancement to our QT Breast Acoustic CT scanner and platform designed to improve visualization and imaging coverage of posterior breast tissue. This region has historically been challenging to evaluate with traditional breast imaging technologies, and we believe the updated configuration further improves the clinical utility and overall performance of our system. On the international regulatory front, we secured official classification and clearance in the United Arab Emirates for both our QT Breast Acoustic CT scanner and the QTI SaaS Cloud platform under our distribution agreement with Al Naghi Medical Company. We also continued to advance our software ecosystem and imaging capabilities. During the quarter, we launched the QT Imaging-Olea Viewer, an innovative multimodality imaging platform designed to support efficient review and correlation of imaging findings across modalities while enabling longitudinal patient evaluation and quantitative analysis.

In parallel, we released software version 4.5.0, a next-generation image reconstruction update that improves spatial resolution in reflection imaging and enhances image quality while maintaining efficient processing time. We believe continuous software innovation will remain a key differentiator and advantage for QT Imaging as we expand our install base and advance toward a more scalable imaging and data platform. Importantly, our commercial efforts continue to be supported by growing clinical evidence generated at leading institutions. For example, at the Mayo Clinic, a prospective feasibility study evaluating QTscan as a supplemental screening tool compared to an MRI in high-risk women provided encouraging early validation of the technology. The study demonstrated absolute agreement between QT Imaging and MRI, suggesting comparable effectiveness of QT Imaging and MRI in identifying positive findings. We also continue to strengthen our clinical and medical advisory team.

During the quarter, we welcomed Dr. Mary Yamashita as Senior Clinical Advisor to support our clinical strategy, reader training activities, and development of structured interpretation pathways for QTscan. More recently, we welcomed Dr. Barry Roseman, a senior medical advisor. Dr. Roseman is a breast surgical oncologist with more than 25 years of experience treating breast cancer and breast disease. He currently operates Advanced Breast Care Surgical Oncology of North Georgia, which is a comprehensive breast imaging and diagnostic center. His engagement with QT Imaging includes implementation of QTscan within his busy clinical practice to support physician training, workflow integration, patient access, and the collection of real-world clinical and operational experience with the technology.

Given his extensive experience at treating women with dense breast tissue, Dr. Roseman understands firsthand the limitations of existing imaging modalities, which can miss cancers in dense breasts, and the need for additional technologies capable of providing more quantitative and clinically meaningful information. We believe QT Imaging technology is uniquely positioned as a radiation-free, compression-free through 3D breast imaging platform capable of delivering quantitative information that may improve clinical decision-making, particularly for women with dense breasts. More broadly, we believe QT Imaging sits at the intersection of advanced imaging, quantitative diagnostics, and AI-enabled healthcare infrastructure. Overall, we remain focused on discipline execution as we continue expanding commercialization efforts, advancing our technology platform, and building long-term value for patients, providers, and shareholders. Now I'll turn the call over to our CFO, Jay Jennings, to review our financial results. Jay?

Thank you, Raluca, good afternoon, everybody. Revenue for the first quarter of 2026 was $6.5 million, up 133% from the prior year quarter. The increase was primarily attributable to the shipment of 13 Breast Acoustic CT scanners during the quarter, up from six scanners in Q1 2025. Cost of revenue for Q1 2026 was $3.9 million, compared with $986,000 for Q1 2025, resulting in a gross margin for the 2026 quarter of 41%, compared with 65% for the 2025 quarter. The higher gross margin in the 2025 quarter was primarily due to the sale of two scanners with a lower cost basis. Total operating expenses for the first quarter of 2026 were $5 million versus $2.9 million a year ago.

The increase was primarily attributable to higher employee compensation and professional and outside service costs. Net loss for the first quarter of 2026 was $3.4 million, which is a substantial reduction from a net loss of $11.1 million for the first quarter of 2025. EBITDA for Q1 2026 was negative $2.5 million, compared with negative $10.4 million for Q1 2025. Excluding stock-based compensation and other non-cash expenses, such as the change in fair value of the warrant and earn-out liabilities, adjusted EBITDA for Q1 2026 was negative $1.5 million, compared with negative $903,000 for Q1 2025.

Net cash used in operating activities during the first quarter of 2026 was $3.7 million, compared with $3.5 million used during the first quarter of 2025. As of March 31st, 2026, the company had cash, restricted cash, and cash equivalents of $7 million. Please see our Form 10-Q filed earlier today for further details regarding our first quarter financial results. Subsequent to the close of the quarter, we amended our credit agreement with Lynrock Lake, extending the maturity date of the $10.1 million senior secured term loan to March 31st, 2029, and increasing the interest rate from 10% per annum to 12% per annum. Turning now to 2026 financial guidance. We are affirming our expectation for revenue of approximately $39 million for the year, more than double 2025 revenue.

This guidance is based on the expected shipment of scanners under distributor minimum order quantities, as well as the early monetization of cloud-based services as we bring our platform online across clinical and research customers. Under our distribution agreements, in addition to the 60 scanners contracted by NXC Imaging for 2026, Gulf Medical is contracted for 20 scanners in 2026, 32 scanners for 2027, and 40 scanners for 2028, for a total exceeding $51 million. Al Naghi Medical is contracted for seven scanners in 2026, 16 scanners in 2027, and 20 scanners in 2028, for a total of approximately $24 million. Now I'll turn the call back to Raluca.

Thanks, Jay. In summary, QT Imaging is building a leading platform in breast imaging and quantitative imaging-based precision diagnostics. We have done the following. One, we have a differentiated technology addressing a large unmet need in dense breast imaging, with greenfield opportunities in adding biomarkers and precision breast technology. Two, we have a strong clinical, regulatory and reimbursement momentum, including our new Category III CPT code. Three, we have strategic manufacturing, distribution and software partners that support global scale in the SaaS-enabled business model. Four, we have a clear roadmap from hardware to recurring software and AI revenue as we expand our installed base and data assets. We are excited by the progress we've made, and we are confident in the path ahead. Thank you so much for your interest in our company and for your support.

With that, we are now ready to take questions. Operator?

The first question today comes from Jeffrey Cohen with Ladenburg Thalmann. Please go ahead.

Hey, good afternoon, Raluca and Jay. Thanks for taking our questions and congrats on all the accomplishments in the quarter. Firstly, can you touch upon Gulf Medical? What's the regulatory status in Saudi? It's approved. Could you talk about the updated and amended agreement that expands the units and the timeline, and maybe give us a sense of how those financials work as far as units and/or the additional software, AI or SaaS model that may be included?

Great. Hi, Jeff. Great to hear you, and thank you so much for joining us. Going back to the beginning of your question. We got the UAE regulatory approval, MOHAP in UAE, and we are not there yet with SFDA. Saudi Arabia FDA approval is still to be received. Jeff, I can tell you we've gone back and forth three, four times with them, how we are at like one or two questions left. We do hope, within the next month or so we're gonna get our SFDA approval. For, I'm sorry, please.

No, go ahead.

Yeah. regarding agreements for Agreements for the Gulf in Saudi Arabia and UAE, we are discussing back and forth with our distribution partners there. As soon as the war gives us a little bit of a break, we'll start shipping in UAE. As soon as we get our SFDA, Saudi Arabia FDA approval, we'll start shipping in Saudi Arabia.

Okay. Would you anticipate Saudi approval this calendar year?

Saudi Arabia, FDA, Jeff, it should be within a month or so. That's, hopefully no later than that.

Okay, got it. I wanted to jump over to your Canon agreement. Could you talk about, it was mentioned in the press release, you called it an amended distribution agreement? Maybe talk about that and tell us if there's been any updates recently as far as timeline and cadence and perhaps beyond this year?

Jeff, we've pushed out the debt of the company from January, from March 31st, 2027 to March 31st, 2029. The team at Lynrock Lake was very kind, and we've discussed this back and forth, and they do have the trust in the company and obviously in the strategy of us together. In terms of NXC Imaging, the contract is for 2026. We are discussing with NXC Imaging and Canon U.S.A. further business beyond 2026. We'll update in the next call as we have more data on that.

We've met in Seattle at SBI conference, we'll continue meeting to hash out what's happening beyond 2026. Thank you so much for the question.

Thank you.

Thank you so much. Great to hear you, Jeff.

As a reminder, if you would like to ask a question, please press star then one to join the question queue. The next question comes from Ben Haynor with Lake Street Capital Markets. Please go ahead.

Good afternoon, Raluca and Jay. Thanks for taking the questions.

Hi, Ben.

First off-

How's it going?

Great. First off for me on the software improvements, that you bumped up the imaging quality on, is there any range?

Beyond, I mean, obviously in just improving the image quality is a good in and of itself, but are there any sort of edge cases whether it's like calcification or things?

-of that nature where the updated image algorithms do a much better job of helping folks identify, you know, important structures or findings?

Ben, that's a great question. First of all, we have improved the resolution of our reflection images in the X, Y, and Z direction. Meaningful like 40%-50% improvement in the resolution. That's critical as we are looking into the morphological shapes of various findings in the breast. To your point, indirectly, we are having better resolution with all the findings, the results from the reflection in the breast. Certainly, calcification is the one finding critical for. That gets discovered via our reflection, not via our transmission. Thank you so much for bringing that up. The 4.5.0 software version directly improves resolution for us to get calcification.

Okay, great. That sounds like a great update. Then, on the kind of, I guess, longitudinal imaging slash.

biopharma front, you know, I know the applications there are potentially pretty exciting. Anymore to share the investors would be interested on that front?

Ben, we are ready to submit a manuscript for a paper with clear results that show the responders that [audio distortion] over various therapies. Those are results from our Sunnybrook Cancer Center IH program. I think everybody will be very pleased reading the paper. It's exactly what we discussed in the past. The patients are being tracked, the volume is being measured of the findings under the certain treatment. Rather than the linear dimension that has much higher error in the measurement, the volume is clearly showing the increase or decrease with much higher precision.

What paper is going out, we have one other very large institution in Boston that's going to be working with us on a very similar study. We do seem to be getting a lot of interest in the precision therapy monitoring as you and I discussed again and again over the last quarters. We're tracking this very important direction for us.

Great. Looking forward to seeing that. Lastly for me, and I apologize if you already mentioned this, but, on the kinda new distribution agreements front, you know, obviously you've got the couple of Middle East distributors and then NXC Imaging. Are there other discussions that are ongoing that, you know, folks should maybe think about new countries coming on, you know, this year, next year, what have you?

We would like to cover fully the Gulf region, Ben, for obvious reasons. We have other four countries in the Gulf region so we're trying to cover from regulatory perspective. It'll take us a quarter or two. We have applied also for AMAR regulatory approval in Israel. It'll take us probably till August or September to get to that. We'll work through the year to get our paperwork together for CE mark like we discussed. That's tracking as we promised in the past. We'll probably have that up and running Q2 next year. That's where we are in terms of expansion, international expansion. A lot to do in the United States for sure, but we're tracking international expansion too.

Okay. Very helpful. That's all I have. Thank you so much.

Oh, thank you so much, Ben. Thank you so much for joining.

This concludes our question and answer session. I would like to turn the conference back over for any closing remarks.

Thank you so much, Betsy. Once again, I'd like to thank you for joining us today and for your interest in QT Imaging. We are energized by our momentum with more to come. We look forward to discussing our progress during our next conference call in August, and we can, when we can report the second quarter results. Until then, have a nice afternoon, and thank you so much.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

Please also note today's event is being recorded. At this time, I would like to turn the floor over to Jody Cain. Please go ahead.

This is Jody Cain with Alliance Advisors IR. Thank you for participating in today's call. Joining me from QT Imaging are Dr. Raluca Dinu, Chief Executive Officer, and Jay Jennings, Chief Financial Officer. I would like to remind listeners that comments made during this call by management will include forward-looking statements within the meaning of federal securities laws. Any statements that are not statements of historical fact should be deemed to be forward-looking statements. Such statements involve known and unknown risks, uncertainties, and other factors that may cause actual results, performance or achievements to be materially different from those implied by such statements.

All forward-looking statements are based on QT Imaging's current beliefs as well as assumptions made by and information currently available to QT Imaging and related to, among other things, QT Imaging's Breast Acoustic CT scanner, including its product commercialization and manufacturing, the evolution of QT Imaging into a scalable imaging platform, the QTI Cloud Platform and SaaS model, performance of software enhancements, new product development and introductions, product sales growth and projected revenues, and QT Imaging's industry and future events. For a list and description of risks and uncertainties associated with the company's business, please see its filings with the Securities and Exchange Commission. Furthermore, the content of this call contains information that is accurate only as of the date of the live broadcast, March 25th, 2026.

QT Imaging disclaims any obligation, except as required by law, to update or revise any financial and operational projections or other forward-looking statements, whether because of new information, future events or otherwise. Now I'd like to turn the call over to Dr. Raluca Dinu. Raluca?

Thank you, Jody. Good afternoon, everyone, and thank you for joining us for our second quarterly conference call. On behalf of our board of directors, management team, and everyone at QT Imaging, I would like to thank you for your interest in our company. For those of you who are shareholders, we appreciate your support. This earnings call marks an important moment for QT Imaging as we continue to build a new category in breast imaging, safe volumetric wave-based 3D imaging that delivers MRI-like information in a clinical and patient-friendly system. Our focus is execution, reliability and commercial expansion in markets where access to advanced imaging has historically been limited. As we evolve from a hardware equipment company into a global data-driven platform, each exam is becoming an even richer source of quantitative AI-enabled insights that can inform care over time.

I am proud of the transformation QT Imaging achieved over the past year. In 2025, we exceeded our revenue targets, increased scanner deployments, laid the foundation for our cloud SaaS platform, expanded internationally through new distribution partnerships, and significantly strengthened our balance sheet. This progress reflects disciplined execution across our commercial and product strategies. The momentum has carried into 2026 as we continue building a stronger and more scalable business. Let's go over the progress and the vision in detail. To recap, our strategy is focused on addressing a significant gap in breast imaging. We are positioning our technology as a preferred screening solution for two key populations, intermediate risk women and younger high risk women under 40, identified through established risk assessment models.

Together, these groups represent roughly 70% of the screening population when accounting for intermediate risk patients, and the large number of women with dense breast tissue will require enhanced screening approaches. This creates a substantial opportunity for increasing access to screening and improving clinical outcomes. Our imaging platform is designed specifically to perform well in dense breast tissue while capturing physiological information about the breast in a way that is close to MRI functional imaging. In a single exam, the system is able to capture multiple physiological biomarkers that reflect vascular, structural, and mechanical characteristics of the tissue. These biomarkers are derived directly from the imaging data itself rather than from laboratory or tissue testing. The result is what we describe as one scan, multiple biomarker approach that can provide clinicians with deeper functional insights while potentially reducing the need for additional follow-on tests.

Beyond QT Imaging Breast Acoustic CT scanner as an imaging system itself, we are building a precision diagnostic ecosystem around the platform using our SaaS model, the QTI Cloud Platform. This software environment, analyzing the physiological biomarkers generated during each scan and converts them into quantitative clinical insights. By leveraging the geometric, elastic, and spectral properties of the tissue captured during imaging, the platform can support diagnostic interpretation, longitudinal monitoring, and clinical decision-making. Over time, this software layer is designed to continuously expand the clinical value of every scanner we deploy. Another important advantage of this system is workflow consistency. The imaging process is designed to be largely operator independent, which reduces variability and helps produce more consistent imaging results across different sites and patient populations. From an economic perspective, the platform is designed to lower overall cost of imaging.

It reduces capital equipment requirements, simplifies operations, and decreases reliance on highly specialized personnel. At the same time it participates in existing reimbursement pathways for physiological imaging with potential incremental reimbursement opportunities tied to the advanced physiological insights generated through the software platform. Equally important is the patient experience. The system eliminates breast compression, ionizing radiation, and contrast injections. That makes the scan significantly more comfortable and less intimidating for patients. We believe this can improve adherence to screening programs, reduce anxiety associated with repeat imaging, and support more consistent long-term monitoring. Finally, because the modality is completely non-invasive and does not rely on radiation or contrast agents, it is particularly well suited for therapy monitoring. Clinicians can perform scans more frequently without the limitation that exists with modalities such as mammography or MRI.

That allows physicians to track treatment response more closely and potentially gain earlier insight into whether a therapy is working. Let's cover now our results and business partnerships. We entered 2026 with strong business and financial momentum, thanks to the many accomplishments our team delivered in 2025. I'm proud to report that last year we shipped 40 scanners, more than tripling the 12 scanners shipped in 2024. We also delivered record revenue of $18.9 million, surpassing our guidance of $18 million. These gains reflect the growing demand of our radiation-free, compression-free 3D breast imaging platform and heightened interest in our technology. Revenue growth in 2025 was primarily driven by our exclusive distribution agreement with our United States distribution partner, NXC Imaging, which is a wholly owned subsidiary of Canon Medical Systems USA.

Last August, we expanded geographically, naming Gulf Medical as our exclusive partner for commercialization of the Breast Acoustic CT scanner in Saudi Arabia, leveraging their strong relationship with hospitals, clinics, and government health institutions. This partnership is expected to drive adoption across both public and private healthcare sectors and aligns with Saudi Arabia's ongoing investment in women's health and advanced imaging. Distribution partnerships like NXC Imaging and Gulf Medical are central to our strategy of scaling the business while maintaining a capital efficient model. In line with this strategy, we expanded our presence in the Gulf region this January through an exclusive distribution agreement with Al Naghi Medical Co, a leading medical device distributor in the United Arab Emirates. This new agreement covers QT Imaging Breast Acoustic CT scanners and our QTI Cloud Platform.

The agreement calls for minimum order quantities totaling 43 scanners over three years, representing more than $24 million in minimum contracted revenue. We will continue to use the strategy of contracting for minimum order quantities to expand in other regions. In October, we entered into a strategic collaboration with Intelerad Medical Systems, now GE, to enable seamless integration of QT Imaging Breast Acoustic CT scanners with their secure cloud-based platform. Intelerad is a global leader in medical imaging solutions and their enterprise picture archiving and communication systems, PACS, and cloud backbone serves as the delivery infrastructure for the QTI Cloud Platform to support clinical and research deployments, facilitate secure data management, streamline workflows, and support integration into existing radiology IT environments.

In January, we announced a partnership with Olea Medical to enhance the QTI Cloud Platform by integrating Olea Medical advanced visualization, quantitative analytics, and AI-ready imaging technologies to support clinical interpretation, research workflows, and quantitative imaging assessments. Olea Medical software uses advanced mathematical modeling and AI-assisted tools to generate robust imaging biomarkers visualization. We believe this technology will further strengthen the clinical utility of our QT scans and enable future AI and machine learning applications. In regards to our regulatory applications and approvals, we have submitted our documentation to Saudi Arabia FDA, SFDA, for regulatory approval in Saudi Arabia, as well as to the Ministry of Health and Prevention for UAE regulatory approval. We received UAE regulatory approval on March 17. We will continue the same regulatory strategy for other Gulf states. Later in the year, we plan to apply for CE Mark regulatory approval for European expansion.

Additionally, this month we have also received the FDA 510(k) clearance for an enhanced configuration of our breast imaging scanner. The updated system incorporates a tilted transmitter geometry that improves tomographic coverage of tissue close to the chest wall. This part of the body anatomy has been extremely challenging to capture with standard imaging approaches, and our enhanced design provides more complete posterior breast coverage and improved overall diagnostic utility. Regarding the reimbursement codes, in November 2025, we applied for a Category III current procedural terminology, CPT code from the American Medical Association, which is designed to support emerging technologies and procedures while further evidence is gathered. On February 23rd, 2026, the American Medical Association CPT editorial panel approved a new Category III CPT code for 3D quantitative transmission volumetric ultrasound tomography of the breast.

The new Category III code X579T represents a significant milestone in the clinical and commercial advancement of QT imaging technology, recognizing the distinct clinical evidence enabled by its radiation-free, compression-free 3D breast imaging platform. The new CPT code ensures standardized reporting of this emerging imaging service, supporting data collection, utilization tracking, and continuing evaluation by clinicians, payers, and health systems. The code is scheduled for release on July 1st, 2026, with an effective date of January 1st, 2027. The reimbursement code will support adoption in hospitals. I'm happy to report a few major updates in our clinical studies. Firstly, Mayo Clinic prospective pilot study evaluated the effectiveness of QT scans compared with MRI as a supplemental screening tool for patients with a high risk of breast cancer.

The study enrolled 26 women with an elevated lifetime risk of breast cancer, more than 20% from July to October 2025. All patients underwent a bilateral breast MRI and QT scan, where the QT scan was performed within 30 days of the MRI. Images of both modalities were independently interpreted by four breast radiologists. This pilot study demonstrated a high absolute agreement between MRI and QT scans, suggesting their comparable effectiveness in identifying positive findings. Secondly, Sunnybrook Cancer Centre prospective observational early validation study evaluated the use of QT scans in detecting, characterizing, and measuring the volume of breast masses in comparison to MRI. QT scans demonstrated good performance in identifying relatively small tumors, multiple lesions, satellite lesions, intraductal extensions, and calcifications, as well as offering valuable diagnostic insights. MRI with contrast offered a broader distribution in size classification.

In summary, the study found good overall agreement between MRI and QT scans for assessing breast mass volume. These results suggest that a QT scan could excel in specific diagnostic scenarios, particularly when evaluating advanced and multifocal disease, and may serve as an important alternative breast imaging option when MRI is not feasible due to availability or patient contraindication. To report now on our cash position. We strengthened our balance sheet through an $18.2 million oversubscribed private placement that was completed in October. This financing was led by Sio Capital, with participation from other institutional and existing investors, positioning us to support continued growth and invest in our platform. We ended 2025 with $10.5 million in cash. We also made important progress at the corporate level.

We successfully uplisted the trading of our common stock to the Nasdaq Capital Market after meeting all applicable financial, corporate governance, and regulatory requirements. This is an important milestone that we believe expands our visibility and access to capital markets both now and in the future. We return to Nasdaq after less than one year due to our very strong turnaround momentum. Regarding our team, we continue to strengthen our clinical and scientific expertise by naming the renowned breast cancer researcher, Dr. Mary Yamashita, as Medical Advisor. Dr. Yamashita will support us across several key areas, including optimizing clinical integration, refining user experience, and ensuring that our technology not only meets, but exceeds the expectations of clinicians and patients. Her deep experience in breast imaging and clinical research will be invaluable as we broaden our install base and continue to generate data in both community and academic settings.

We also continue to strengthen our operations team, having recently hired the vice president of manufacturing, the vice president of quality and regulatory, and plan to add the vice president of supply chain and production planning. Regarding media and IR. Recently, we partnered with The Shift, which is an intergenerational, interdisciplinary media platform featuring Gloria Steinem as their Inaugural Changemaker and cover star alongside other prominent women to broaden awareness of QT Imaging technology and our scanner as a safe, comfortable imaging modality, and to spotlight our growing global commercial momentum. This collaboration aligns our women-centered radiation-free imaging platform with The Shift's influential voice to help reach and educate women who shape conversations around health and innovation. As part of this partnership, we will participate in The Shift Makers Awards and Gala at Harvard University this week.

Our advances in breast imaging will subsequently be featured in The Shift publication to further the education and impact for early detection and prevention, extending our message to a broader audience of women that would benefit from the QT Imaging technology. Additionally, we engaged Alliance Advisors IR team to broaden our outreach to investors and enhance our presence in the capital markets. Communicating our strategy, execution, and long-term value proposition more effectively supports our focus on establishing a shareholder base that fully understands and embraces our growth trajectory and the transformative potential of our technology. Now I'd like to turn the call to our CFO, Jay Jennings, to review financial results. Jay?

Thank you, Raluca, and good afternoon, everyone. I'll start with a review of our fourth quarter financial performance, followed by our full year results. We reported record revenue of $8.3 million for Q4 2025, up 877% from the prior year and up 97% versus Q3 2025. The year-over-year increase was primarily attributable to the shipment of 17 Breast Acoustic CT scanners during the quarter, fulfilling the 2025 minimum order quantity under the NXC Imaging distribution agreement. Cost of revenue for Q4 2025 was $5.1 million compared with $447,000 for Q4 2024, resulting in a gross margin for the 2025 period of 38% compared with 47% in the 2024 period.

The decrease was primarily attributable to the shipment of two scanners in the 2025 quarter, built by our contract manufacturing partner at a higher cost due to tariffs and other fees. Total operating expenses for the fourth quarter of 2025 were $3.8 million compared with $2.5 million for the same period of 2024. The increase was primarily attributable to increases in employee compensation and professional and outside service costs, partially offset by an increase in the allocation of overhead expenses from operating expenses to cost of revenue. Our operating loss for Q4 of 2025 was $700,000, substantially narrowed from $2.1 million in Q4 2024.

Net loss for Q4 of 2025 was $1.4 million, which is a substantial reduction from a net loss of $3.5 million for the fourth quarter of 2024. EBITDA for Q4 2025 was -$371,000 compared with -$2.1 million in Q4 2024. Excluding stock-based compensation and other non-cash expenses, such as the change in fair value of earn out liability, adjusted EBITDA for Q4 2025 was -$400,000, an improvement from -$1.5 million for Q4 2024. Net cash used in operating activities during the fourth quarter of 2025 was $3.1 million compared with $1.2 million for the fourth quarter of 2024.

The increase was primarily due to an increase in accounts receivable to $5.8 million as of December 31st, 2025, which was subsequently collected in full, partially offset by a lower net loss as adjusted for non-cash expenses. Turning now to the full year. We shipped 40 systems in 2025. Revenue was $18.9 million for 2025, exceeding the company's guidance of $18 million and representing 288% growth over 2024. Gross margin for 2025 was 45% compared with 54% for 2024. The decline was primarily attributable to the three scanners built by our contract manufacturing partner at a higher cost due to tariffs and other fees that I mentioned earlier. Total operating expenses for 2025 were $13 million, a 12% improvement from $14.8 million in 2024.

The decline was primarily attributable to a $4.3 million decrease in transaction expenses related to the business combinations in 2024, a $1.7 million increase in the allocation of overhead expenses from operating expenses to cost of revenue, and a $300,000 reduction in insurance expense. These reductions were partially offset by a $3 million increase in compensation and benefits, a $1 million increase in professional and outside services, and a $200,000 increase in technology infrastructure expenses.

Net loss for 2025 was $21.1 million, which included other expense of $8.8 million, consisting of non-cash expense of $6.6 million incurred at the issuance of the Lynrock Lake term loan, an extinguishment loss of $2.1 million for the Yorkville note and Cable Car note, and a $100,000 extension fee for the Cable Car note, as well as a $3.6 million increase in the fair value of warrant liability and a $1.8 million increase in the fair value of earn out liability. This compared with a net loss of $9 million for 2024. EBITDA for 2025 was -$18.3 million compared with -$4.3 million for 2024.

Non-GAAP adjusted EBITDA for 2025 of -$3.5 million, improved 52% with -$7.4 million for 2024. Net cash used in operating activities for 2025 was $9 million compared to $10 million in 2024. As of December 31st, 2025, the company had cash, restricted cash, and cash equivalents of $10.5 million. Please see our Form 10-K filed earlier today for further details regarding our financial results. Turning now to 2026 guidance. We are affirming our expectation for revenue of approximately $39 million for the year, more than doubling 2025 revenue. This guidance is based on the expected shipment of scanners under current distributors minimum order quantities, as well as the early monetization of cloud-based services as we bring our platform online across clinical and research customers.

Under our distribution agreements, in addition to the 60 scanners contracted by NXC Imaging for 2026, Gulf Medical is contracted for 20 scanners in 2026, 32 scanners in 2027, and 40 scanners in 2028. Al Naghi Medical is contracted for seven scanners in 2026, 16 scanners in 2027, and 20 scanners in 2028. Now I'll turn the call back to Raluca.

Thanks, Jay. As we execute our strategy, QT Imaging is now defined by our scanners as well as by data, quantitative biomarkers, and cloud-based tools. By combining the radiation-free, compression-free 3D imaging modality with secure cloud delivery, advanced visualization and quantitative analytics, we are building a differentiated, scalable, data-centric ecosystem that supports a broad range of clinical research and AI-driven applications in breast imaging. Every exam we will generate will reach quantitative data such as speed of sound, attenuation, and reflection that power BI-RADS aligned tools and probability of cancer maps. This delivers to clinicians more than images alone, but also actionable AI-ready information. Our business model is structured on the installed scanners, forming the base and cloud SaaS and AI modules, driving recurring revenue through ongoing software and analytics upgrades.

I am proud of our team's performance and dedication as we work to transform breast imaging through safer, quantitative, and more accessible technologies. We believe QT Imaging is well-positioned to become the breast imaging platform of choice for women, clinicians, and the health systems. With strong momentum, expanding partnerships and growing adoption, our company is well-positioned for another year of meaningful growth and innovation. On behalf of our board of directors, management team, and everyone at QT Imaging, thank you for your interest in our company and for your support. With that, we are now ready to take questions. Operator?

We will now begin the question-and-answer session. To ask a question, you may press star and then one on your telephone keypads. If you are using a speakerphone, we do ask that you please pick up your handset prior to pressing the keys to ensure the best sound quality. To withdraw your questions, you may press star and two. Again, that is star and then one to join the question queue. We will pause momentarily to assemble the roster. Our first question this afternoon comes from Ben Haynor from Lake Street Capital Markets. Please go ahead with your question.

Good afternoon. Thanks for taking the questions. First off for me, just wanted to get a sense of what you're seeing in terms of utilization ramps as these new installs kinda come online. Is it, does it track similar to what you've seen in the past? Is it quicker? Any color there would be helpful.

Ben, thank you so much. I appreciate you joining us. I appreciate all the great conversations we have across the course. Ben, we do see a pickup of installations from our distributor in the United States of various scanners in the field. We are not keeping up with the updates on the website that we're not current today necessarily, but I have few other thoughts to share. Today we are only working through NXC Imaging as our exclusive distributor in the United States. As you've seen, and you and I discussed in the past, we've gotten our Category III CPT code, which will open doors for us in hospitals in United States.

As we've discussed, we have hired Satrajit Misra. Satrajit is our Chief Commercial Officer, and he's doing a fabulous job opening up opportunities in the United States in parallel with and coordinated, obviously, with our distributor, NXC Imaging. Very important for us because as you know, this is a new technology. Sales into hospitals would be able to be done in coordination with the company. One other point I discussed in the call about our two major clinical studies comparing QT with MRI. We're very proud of both of them.

We will continue putting clinical data into the market, comparing this imaging technology to MRI and to other imaging modalities with the support of our collaborators that they are doing an incredible job, and we are very grateful for that. Last one, Dr. Mary Yamashita, she joined the team. She's an incredible radiologist with deep knowledge of various imaging modalities and we'll rely on her expertise to guide us further. We do have great traction in the United States and will do even better in the future.

Excellent. You know, just thinking about the kind of biopharma usage opportunity, you know, being able to repeat QT scans as frequently as you want, and the applications for potentially tracking treatment response. You know, are you having conversations there? What are thoughts kind of around that, you know, segment or opportunity out there?

Yes. Ben, very dear to our hearts. As we know, this is a quantitative technology that we can measure the volume of the finding and obviously the medication that provided to the patient will be able to, the effect of that medication will be able to be tracked very fast since it's a modality that does not expose the body to any radiation. If it works, the doctor, the oncologist will know in few weeks if it's the right medication or not. We do have this on our radar. Satrajit and I discuss it all the time. We will address it within this year for sure.

There are so many clinical studies going on in the United States that we could be participating with this scanner to be able to offer this imaging modality as a tool to the oncologist and the pharma companies checking various medications for the patients. We will follow up on this one, Ben, and update in our future calls for sure. Thank you so much for bringing it up.

Yeah. That makes sense. Stay tuned there. On CE Mark, is that the clearance or the approval that you're going for there, is that, you know, kind of straight up the system, or are there, are you gonna do any sorts of biomarkers alongside that? What's kind of the-

Mm-hmm.

What does that submission look like?

The Saudi Arabia, Ben. I missed that. Or United States?

For CE Mark.

Oh, CE Mark. Yes. Ben, this year we'll work hard on putting together all the documentation for that. First the scanner and then the biomarkers. Like United States. Like we've done in United States, FDA approval and 510(k), and we've gotten the latest approval a few weeks back. We'll do the same for the application for the CE. First the scanner and then the biomarkers for sure.

Okay. Sequence there?

Yeah, just one sentence. Quite a lot of bureaucracy and documentation for that. We'll work through the year for the application for CE Mark. We have very good partnerships with them and support for that. We'll update in our calls. That's next on our list for sure.

Got it. I guess lastly for me on, you know, just kind of on the news flow that folks should expect this year? Obviously we've got CE Mark, we've got, you know, the biopharma potential opportunity. You've got, you know, what do we have kinda, what else on the biomarker front, AI front, what can we expect this year?

Cool. Ben, first of all, SFDA approval. We are applying for the other four states in the Gulf, and hopefully this war will end soon, so we can get back to business. We have Bahrain, Qatar, Kuwait and Oman. We'll apply for the regulatory approvals there. CE Mark, that's for regulatory approval on our end. We do have in the pipeline improvements of our reconstruction software for reflection and attenuation. The biomarkers. One after another we'll report as soon as we have good results. I mean, quite soon on some of those for sure. That's from that perspective. Obviously the results for our clinical studies.

We are continuing the collaboration with the Odette Cancer Centre, with Mayo, and we have a few new ones, starting soon.

Great. Sounds like we're in for an eventful year. That's it for me. Thank you very much.

A lot of fun. Thank you so much, Ben. I appreciate it. Thank you so much.

Once again, if you would like to ask a question, please press star and then one. To withdraw your questions, you may press star and two. Again, that is star and then one to join the question queue. It's showing no questions at this time. I'd like to turn the floor back over to Dr. Dinu for any closing remarks.

I appreciate it. Thank you so much. Thank you for joining us today and for your interest in QT Imaging. We are energized by our progress with more to come, and we look forward to discussing our success during our next conference call in May when we'll report the first quarter results. Until then, thank you, thank you again, and have a nice evening. Thank you very much.

With that, everyone, we'll close today's conference call and presentation. We thank you for joining. You may now disconnect your lines.