Electromed, Inc.

Greetings and welcome to the ElectroMed Fiscal Q3 2026 Earnings Call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone requires operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Mike Cavanaugh, Investor Relations. You may begin.

Good afternoon and thank you for joining the ElectroMed earnings call. Earlier today, ElectroMed Incorporated released financial results for the third quarter of fiscal 2026. The press release is currently available on the company's website at www.smartfest.com. Before we get started, I would like to remind everyone that some of the statements that management will make on this call are considered forward-looking statements, including statements about the company's future operating and financial results and plans. Such statements are subject to risks and uncertainties that could cause actual performance or achievements to be materially different from those projected. Any such statements represent management's expectations as of today's date. You should not place any undue reliance on those forward-looking statements, and the company does not undertake any obligation to update or revise forward-looking statements, whether as a result of new information, future events, or otherwise. Please refer to the company's SEC filings for further guidance on this matter. Joining me on the call today are Jim Kniff, Electromed's President and Chief Executive Officer, and Brad Nagel, Chief Financial Officer. As on previous calls, Jim will provide operational highlights from the quarter. Brad will then review the financials, and we will close with a question and answer session. With that, I will now turn the call over to Jim Kniff, President and Chief Executive Officer of ElectroMed.

Good afternoon, everyone, and thank you for joining us today. I'm excited to share our third quarter results. Let me start with the headlines. Q3 marks our 14th consecutive quarter of year-over-year revenue and profit growth. We delivered revenue of $18.6 million, representing 18.4% growth compared to the prior year. This performance reflects the strength of our commercial execution and the growing recognition of SmartVest as the leading solution for airway clearance. Growth was broad-based across our business. Our flagship home care segment grew a robust 19%. Our distributor revenues increased 3% driven by consistent demand from our DME partners. Hospital grew 43% over prior year and rebounded after a slow second quarter. This diversified growth demonstrates the strength of our market position and the effectiveness of our multi-channel strategy. Even more impressive is our record bottom line performance. Operating income increased to 3.8 million in the third quarter, a 76% increase versus prior year. Diluted earnings per share came in at 35 cents, up 67% versus the prior year. From a balance sheet perspective, we maintained a strong cash position of $17 million. As you may recall, our board approved a $10 million stock repurchase authorization in the first quarter, reflecting our confidence that ElectroMed represents a sound investment. Yet we slow repurchasing activity in Q3 as we assess the recent macro market dynamics. We remain committed to finding ways to deliver value back to our shareholders. Looking at our results, it's clear that the business model ElectroMed has built is working well. Our focus on airway clearance for the home care market, coupled with our productive sales and fulfillment teams, which handle the process from prescription to delivery of the vest to the patient's home, sets us apart in the market. Moreover, our business model is a strong foundation for continued future growth. As we've said many times, bronchiectasis is underdiagnosed and airway clearance is underprescribed. That said, let me turn to what I believe is the most exciting part of our story, the underserved bronchiectasis market. This represents the primary strategic opportunity for Electromed, which we are executing to capture. The numbers tell a compelling story. Today, approximately 923,000 patients in the United States are diagnosed with bronchiectasis, yet only 16% are currently benefiting from high-frequency chest wall oscillation therapy. Think about that. Nearly 800,000 diagnosed patients could experience the life-changing benefits from our SmartVest system, but aren't receiving this therapy today. Equally compelling is that it is estimated that over 4 million additional individuals may have undiagnosed bronchiectasis. This highlights not just a large commercial opportunity, but the need for continued education and awareness about this disease. To seize this opportunity, ElectroMed launched our innovative Triple Down on Bronchiectasis campaign, which promotes a powerful three-pronged treatment paradigm that's changing how clinicians think about bronchiectasis management. Number one, clear airways first with SmartVest to effectively remove mucus, which is the fuel for future infections. Second, treat the patient's infection with antibiotics. And third, help reduce inflammation. This approach helps break what we call the vicious vortex, where chronic infection, persistent inflammation, and damaged airways continuously worsen, leading to progressive lung disease and reduced quality of life for patients. The campaign is delivering results. Our digital promotion of the Clear Airways First messaging has been running for 18 months and has generated over 2 million impressions and generated more than 65,000 visits to our educational landing pages. We're reaching clinicians where they are and changing the conversation around bronchiectasis treatment. At the same time, our clinical team is out in the field making a difference. In the third quarter alone, they spoke at four regional respiratory conferences promoting what we call the ABCs of bronchiectasis, always be clearing the airways first with SmartVest. We're also seeing success with peer-to-peer education. We conducted four virtual webinars featuring respected pulmonologists, which were attended by over 375 clinicians. When physicians hear from their peers about the clinical benefits of SmartVest, it moves the needle. Our presence at key conferences continues to expand our reach, The SmartVest team attended three national conferences in the quarter, ensuring we're visible and engaged where bronchiectasis specialists gather. We've also been doing important research to understand where the gaps are in patient care. We completed a manuscript based on the data from the NTM Bronchiectasis Research Registry, which found that 58% of qualifying patients were not prescribed HFCWO therapy despite meeting clinical criteria. This gap represents an obvious opportunity for early intervention, and our team is working aggressively to close it, in part through our Sip On This campaign, aimed at driving conversations with high bronchiectasis-diagnosing physicians who aren't yet prescribing HFCWO. Beyond clinical education, we're also innovating on the technology and process side to make it easier for clinicians to prescribe SmartVest and for patients to receive therapy faster. Our smart order e-prescribed solution is transforming how clinics submit orders to our fulfillment team. This is particularly timely given that CMS recently finalized new rules requiring covered entities to modernize their processing of orders and phase out faxes by May 2028. Our e-prescribed solution already meets CMS requirements for electronic signatures and processing of orders, positioning us ahead of this industry shift. The introduction of the e-prescribed solution has been a success. In the third quarter, over 40% of orders came through our smart order solution, resulting in a five-day reduction in average days to ship versus fax orders. And the number of prescriptions processed through the system is only anticipated to increase. That means patients get their therapy faster and clinics benefit from improved workflow. Increasing payer coverage remains a primary strategy to ensure patients benefit from our technology. I'm pleased to report that we now have 86% of covered lives in the U.S. under contract who could benefit from SmartVest. The covered lives we've added over the past 18 months have resulted in over 50 referrals where we would have otherwise not been able to recognize revenue. Each one of those represents a patient whose life we can improve. On the commercial side, we added Q3 with 58 direct sales reps. While this is flat versus the second quarter, I'm happy to report that we have since added four additional sales reps to our roster, which is now up to 62, maximizing our market coverage. Before I hand the call over to Brad, I want to touch briefly on our operational capabilities, which are yet another significant competitive advantage, especially in today's environment. Our manufacturing optimization plan initiated last year is complete. We physically restructured our manufacturing facility to improve our production process and provide capacity for future growth. I'm particularly proud that our products are manufactured in the United States. ElectroMed is a U.S.-based company with operations and product assembly located domestically, and 99% of our net revenues are generated in the United States. While not without risk, we have continued to maintain our strong track record of on-time delivery to our customers and sustain our robust gross margins, even during the current uncertain global environment. With that, I'd like to turn the call over to Brad for a review of our financials. Brad, over to you.