Stereotaxis, Inc.

Good morning. Thank you for joining us for Stereo Taxi Second Quarter 2021 Earnings Conference Call. Certain statements during the conference call and question and answer period to follow may relate to future events, expectations, and as such constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties, and other factors which may cause the actual results, performance, or achievements of the company in the future to be materially different from the statements that the company's executives may take today. These risks are described in detail in our public filings within the Securities and Exchange Commission, including our latest periodic report of Form 10-K or 10-Q. We assume no duty to update these statements. At this time, all participants have been placed on a listen-only mode. The floor will be open for questions and comments following the presentation. As a reminder, today's call is being recorded. It is now my pleasure to turn the floor over to your host, David Fishel, Chairman and CEO of Serial Taxis.

Thank you, Operator, and good morning, everyone. I'm joined today by Kim Perry, our Chief Financial Officer. In the second quarter, we delivered robust growth and our strongest absolute revenue since 2015, as we continue to benefit from a return of robotic system sales. Euro-year comparisons are inflated by a particularly depressed second quarter of 2020, but current quarter revenue was up approximately 70% year-over-year, up 5% sequentially, and up 33% from the second quarter of 2019. Renewed adoption of robotic systems is the first significant wave of revenue growth in our strategic innovation plan. We are pleased to reap the initial fruits of that strategy and are confident the strategy will lead to a multi-year period of sustained robustness. System revenue reported in the quarter reflects shipments of a Genesis and Model S system to a hospital establishing a new robotic electrophysiology program in the United States, as well as an IOB system to a hospital establishing a new robotic electrophysiology program in China. As discussed on prior calls, partial revenue recognition is often triggered upon shipment of systems, and the revenue reported reflects a portion of the overall contract value from these two deals. During the second quarter, we received two orders for robotic systems. One, as previously discussed, to a US hospital, and the other to one of the most prestigious medical centers in China, Fuwai Beijing. Fuwai Beijing is a very large cardiovascular hospital with 17 cath labs performing over 50,000 interventional procedures a year. They are establishing a new robotic electrophysiology program after observing our success in other practices and conducting a head-to-head study that showed significantly lower rates of silent strokes in robotic versus manual emulation procedures. This was our second order from China this year, and these two orders will be the first new robotic systems in China in nearly 10 years. This is a reflection of the renewed interest and acceptance that we are experiencing globally and the specific high level of customer and strategic interest we are seeing in China. Thus, China is emerging as a third geographic pillar for our business. We believe that emerging relationships with strong strategic partners in China may allow for broad adoption of our technology in that geography. We will enter into any relationship in a prudent fashion that enhances our long-term opportunity and look forward to sharing additional details when appropriate. I recognize the uneven pace of orders announced on any individual quarterly call makes projections difficult. but we continue to see significant interest in Genesis. During the quarter, we hosted 35 separate telerobotic visits, 13 of which were to new potential customers. Over the last nine months, we received seven orders for robotic systems, five of which were from Greenfield customers establishing new robotic programs. We are now seeing increased activity from multiple hospitals that delayed lab replacement projects during the depth of the pandemic. we expect 2022 to reflect a near normalized level of replacement cycle projects. Orders received in the remainder of 2021 and early 2022 are expected to result in approximately a doubling of system revenue next year and contribute to robust double-digit revenue growth in 2022. As we grow our business, we are investing in establishing the commercial, operational, and technological foundations that will allow for long-term growth. Commercially and operationally, we continue to expand our fellows program, are pleased to welcome several experienced new leaders across various roles in our organization, and are on track to move into an expanded new headquarters at year end. Two weeks ago, we were particularly excited to announce the addition of Dr. Miriam Curay as an independent board member. Her long-term experience in executive leadership and intuitive surgical is highly beneficial as we look to positively transform interventional medicine with robotics as Intuitive has done across laparoscopic surgeries. Technologically, we are aggressively advancing the second and third waves in our strategic innovation plan. Stereotaxis's advanced, robotically navigated magnetic ablation catheter represents the second wave in our strategic innovation plan. The catheter has been progressing through the manufacturing and testing processes necessary for submissions for European approval and a US IDE study. Supply chain challenges, however, have caused some manufacturing delays at our partner, Osipka. Most recently, in July, Osipka received a force majeure letter from a supplier of a specific epoxy glue, delaying previously confirmed shipments. This seems to be a global phenomena, and we've been addressing disruptions like this with grit and creativity, but they have a disruptive impact. We now expect to complete manufacturing and testing of the hundreds of catheters needed for our regulatory submissions and complete those submissions for European approval and a U.S. pivotal trial early next year. We believe that will allow for revenue contribution from the catheter in Europe in 2022 and a potential U.S. regulatory approval in 2023. We continue to work energetically on a third wave of innovations, both independently and with new partners. that will accelerate our adoption in electrophysiology and expand our robotic technology into new adjacent markets. We believe we will be in a position to present several of these in more detail at the end of this year, and given our progress, this should lead to several regulatory filings and product launches in 2022. We are confident in the positive impact these innovations will have on patients, physicians, providers, and on Stereo Texas's financial and strategic foundation. Kim will now provide some commentary on our financial results, and then I'll make a few financial comments as well before opening the call to Q&A.

Thank you, David, and good morning, everyone.