Hyperfine, Inc.

Hello and welcome to the Hyperfine Q425 earnings call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, just press star followed by the number one on your telephone keypad. And if you would like to withdraw your question, press star one again. Thank you. Now I would like to turn the call over to Webb Campbell. Webb, you may begin.

Thank you for joining today's call. Earlier today, Hyperfine Inc. released financial results for the quarter ending December 31st, 2025. A copy of the press release is available on the company's website as well as sec.gov. Before we begin, I'd like to remind you that management will make statements during this call that include forward-looking statements within the meaning of federal securities laws, which are made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. Any statements contained in this call that relate to expectations or predictions of future events, results, or performance are forward-looking statements. All forward-looking statements, including without limitation, those relating to our operating trends and future financial performance, expense management, expectations for hiring, training and adoption, growth in our organization, market opportunity, commercial and international expansion, regulatory approvals, and product development are based upon current expectations and various assumptions. These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated or implied by these forward-looking statements. Accordingly, you should not place undue reliance on these statements. For a list and description of these risks and uncertainties associated with our business, please refer to the risk factors section of our latest periodic filing with the Securities and Exchange Commission. This conference call contains time-sensitive information and is accurate only as of the live broadcast today, March 18, 2026. Hyperfine Inc. disclaims any intention or obligation, except as required by law, to update or revise any financial projections or forward-looking statements, whether because of new information, future events, or otherwise. With that, I will turn the call over to Maria Sainz, President and Chief Executive Officer.

Good afternoon, and thank you for joining us. On the call with me today is our Chief Administrative Officer and Chief Financial Officer, Brett Hale. Fourth quarter revenue of over $5 million demonstrated our very strong performance with the next generation subsystem for the second straight quarter. the mid-2025 introduction of our second-generation soup scanner, the updated AI software, and the addition of a new market with our launch into the neurology office setting mark a turning point in the adoption of portable brain MRI, the potential of ultra-low-field MRI, and the future of our company. We have now demonstrated that we hold a highly proprietary and differentiated technological position in our ability to produce diagnostic quality images with an ultra-low field magnet, making HyperFind's technology safe, accessible, and deployable across a continuum of preventative, acute, and chronic brain health settings. In 2025, we validated that the SUSE system offers unequivocal clinical and economic value to clinicians and providers ready for mainstream adoption and scale across a growing number of sites of care inside and outside the hospital. I want to start by summarizing some of the key highlights from the last several months. to illustrate why I feel very optimistic about the future of the SOOP system for brain health and Hyperfine's unique position with ultra-low-field MRI long-term. From a market perspective, the feedback on SOOP's image quality with Optive AI software continues to be outstanding from the neurology, neurosurgery, and radiology communities, leading to deal activation, reactivation, larger deals, and interest from IDNs and health systems. The FDA clearance in December 2025 of our first update after the release of Optive AI software represents the 11th generation of software releases and confirms our commitment to continuous image quality advances with ultra-low-field MRI. This latest soup software incorporates features in our diffusion-weighted imaging to further refine the value of the soup system in stroke workflows. The recently published SLEEM Stroke Publication and the newer PMR Presentation validate the clinical diagnostic utility of the SUP system for stroke triage and for patient care in neurology offices, respectively. The publication of the health economic impact data adds an incredibly important element to our selling approach. We now have published evidence to support the cost savings in medical supplies, staff usage, and a significant improvement in patient progress when using the SUP system. Finally, the approval of the first generation subsystem in India opens a new large geographic expansion opportunity for hyperfarm. Throughout 2025, we executed on our operational milestones across innovation, clinical and economic evidence generation, and site of care and geographic expansion. We delivered strong revenue growth in the second half of the year, and importantly, we see market activation momentum continuing as we progress through 2026. This transformation was achieved in the context of a continued reduction in cash burn and gross margin expansion, demonstrating the scalability and leverage of our business model. We ended the year with a healthy balance sheet, And with the growth capital added from our recent financing, we are well positioned for sustained growth and investment in our technology, current markets, and potential future expansion opportunities into 2028. Over the past six years, we have maintained an unwavering commitment to continuous innovation and market development, transforming our original concept for an ultra-low-field portable brain MRI system into a highly differentiated and clinically relevant platform ready for broad adoption to help address the real limitations related to brain imaging. The next-generation subsystem with OptipAI software represents the culmination of phenomenal innovations in electronics, physics, and AI technology. to make image quality at 64 milliTesla approach that of high-field MRI. Looking ahead, these advancements represent a new beginning and a stronger platform to further increase clinical capabilities and expand into additional use cases across sites of care. We received FDA clearance for the next upgrade to the OptifAI software last December. This latest software focuses on advanced multidirectional diffusion-weighted imaging to enhance stroke detection. Going forward, you can continue to expect a cadence of one to two software releases per year as we expand upon our leadership in the AI-enabled ultra-low-field MR imaging space. We have now sold over a dozen next-generation systems since June, and have launched incredibly busy and successful SUP programs across critical care, emergency departments, and neurology offices. Exiting 2025, our primary call points are adult and pediatric critical care, emergency departments, and neurology clinics and offices. More recently, we have actively begun pilot efforts in the neurosurgical and neurointerventional setting, as well as in mobile units for dementia screening research. We will continue to lean on our strengths, not only in continuous innovation, but also in clinical data generation to support a growing number of use cases and widespread adoption. A good example of this is our contrast PMR study. a prospective multicenter clinical study to evaluate the feasibility and visualization benefits of contrast-enhanced ultra-low-field portable MRI. I'm pleased to share that we are approximately 20% towards our enrollment goal. The study is designed to support a future FDA submission late 2026 to expand the subsistence intended use to include gadolinium-based contrast agents potentially unlocking new applications as we focus broadly on neurodegenerative diseases and surgical use. Brain scans with contrast will potentially broaden the use of the subsystem across office and hospital settings. In outpatient care, scans with contrast are reimbursed using a dedicated CPT code Turning to our clinical work in the ED, we are seeing significant traction with accounts interested in deploying the subsystem in the ED for faster stroke triage using MRI. The excessive wait time for MRI in the ED is a costly and widespread patient care issue across hospitals of all sizes. Beyond the recently published VIN paper, the PRIME study, being led by the Yale School of Medicine, is an additional project to validate the subsistence utility in England's faster triage of old-comer patients in the ED. As a reminder, this study evaluates the potential of AI-powered portable MRI for broad patient triage in the ED. I'm happy to share years of completed enrollment ahead of schedule and expect to share an update on the findings later this year. The compelling image quality of the next-generation subsystem with Optive AI software is activating our hospital pipeline to levels we have not experienced before. Driven by interest from both clinical and administrative stakeholders, and evolving deal discussions to multiple placements, as well as first and subsequent deals at IDNs across the U.S. These larger, more strategic deals are very encouraging for the future growth of our business. Although larger deals have increased administrative processes and are more dependent on budget cycles, creating some potential for quarterly lumpiness and variability. With a recently published health economic impact data analysis as reference, hospitals evaluating the subsystem are now modeling one to one and a half year return on investment timelines, substantially better than the three to four year typical for capital equipment. The recent publication summarizes the data compiled at Jefferson Abington across 143 scans, related to their savings in cost of care driven by reduction in supplies, faster clinical decision-making, accelerated patient discharge, and freed up capacity on conventional scanners for elective procedures. These real-world, peer-reviewed health economic data have become powerful catalysts for deals and elevating conversations to C-suite decision-makers. With our device MSRP of $590,000 for our next generation system, we can capture significant value while delivering strong ROI for our customers. The neurology office represents an additional growth vector for our business. Neurologists prescribe a high volume of MRIs, yet only approximately 10% of private neurology practices have MRI imaging onsite, which creates an enormous addressable market opportunity with minimal incumbent competition. Our full commercial launch into this market in Q3 has progressed rapidly through Q4. Our pilot program in the first half of 2025 confirmed the process through accreditation, training, and reimbursement to scale portable brain MRI as an ancillary business in the office setting. We have proven that physicians can obtain diagnostic quality MR brain images within their offices, providing patients with timely and convenient access at the point of care. In January 2026, data from our office's study, NeuroPMR, was presented at the American Society of Neuroimaging. In this study, patients received brain imaging on both the portable subsystem and conventional high-field MRI. In the study, portable MRI demonstrated 92% concordance with a standard MRI in identifying the presence or absence of intratranial pathology during a blinded review by independent neuroradiologists. In unblinded paired image reviews incorporating clinical history, concordance increased to 98% as assessed by a neurologist and neuroimager. Furthermore, patients expressed a strong preference for portable MRI, reporting that they were four times more likely to choose portable MRI over standard MRI. Across all experience measures, including comfort, anxiety, claustrophobia, noise, and overall satisfaction, portable MRI was rated superior to standard MRI. Trained clinical staff successfully operated the system within neurology offices without the need for MR technologies, highlighting its safe and straightforward operation. In Q4, we accelerated our selling efforts across both single and multi-clinician practices, building robust pipelines of both our first and next-generation subsistence. We deployed a segmentation pricing strategy, offering different configurations to serve practices of varying sizes and profiles. We're also leveraging our Neuronet partnership to promote adoption across their network of neurology practices. The office market is still in its early days, yet reception has been robust and has been further fueled by the presentation of data from Neuro PMR. Turning to our international business, where we have made significant progress in the quarter, we have launched Optic AI software in 10 different European languages, with the software now available in the international markets we serve. We're going through the European regulatory process to bring the next generation subscanner to the UK and CE markets before the end of this year. Additionally, in late 2025, we also received regulatory approval in India, unlocking a key new market. With our local partner, we are planning the launch, engaging top KOLs in the country to help drive awareness and adoption. In accordance, we expect placements in India to scale at a measured pace throughout the year. Market feedback on the subsystem with Optic AI software remains consistently very positive. I firmly believe the subsystem today is ready for broad adoption and our image quality positions as well to continue to broaden and deepen use cases. We have three diverse and differentiated business opportunities to drive growth in the near future through placements across the hospital, neurology offices, and international markets. I will now turn the call over to Brett to review our financial performance and 2026 guidance.

Thank you, Maria. Before I recap our financial results for the fourth quarter and full year of 2025 and our expectations for 2026, I want to touch on our recently strengthened capital position. Last October, on the heels of our first full quarter of our next generation scoop system launch, we strengthened our balance sheet by raising over $20 million in equity, welcoming multiple quality investors to the story. More recently, building on our business momentum and to complement this equity, we raised $15 million as an initial tranche under an up to $40 million long-term debt facility. The initial tranche extends our cash runway into 2028, and the broader facility provides growth capital and significant financing flexibility for the commercial phase of our company. We are adding this non-dilutive capital on attractive terms and have sized the upfront tranche to extend our cash runway while continue to responsibly reduce our cash firm. For purposes of modeling, we expect quarterly interest payments to be approximately $400,000, and these payments are contemplated in our cash firm guidance. Now turning to our Q4 and full year 2025 results. Revenue for the quarter ended December 31, 2025, was $5.3 million, up 128% compared to $2.3 million in the fourth quarter of 2024. We sold 16 units net in the fourth quarter of 2025 versus nine units in the fourth quarter of 2024. We saw demand across all businesses with placements in hospitals, neurology offices, and international markets. This quarter, some hospital systems elected to grow with our technology through a four-charge technology upgrade comprised of multiple unit placements. For the full year 2025, we generated $13.6 million in revenue, up 5% compared to $12.9 million in 2024. As anticipated, 2025 was a tale of two halves. with significant growth in the second half due to multiple mid-year product launches, generating $8.7 million in revenue in the second half, compared to $4.8 million in the first half of 2025. Gross profit for the fourth quarter of 2025 was $2.7 million, of 226% compared to the fourth quarter of 2024. Gross margin was 50.9%, our second straight sequential quarter above 50%, and representing 1,530 basis points of gross margin expansion over the fourth quarter of 2024. For the full year 2025, we generated $6.8 million in gross profit, up 15% compared to the full year 2024, and our full year gross margin was 49.8%. representing 410 basis points of gross margin expansion over 2024. We continue to drive healthy margins for our stage and believe we are well positioned for meaningful margin expansion as we scale. R&D expenses for the fourth quarter of 2025 were $3.8 million, compared to $5.1 million in the fourth quarter of 2024, a decline of 25%. For the full year 2025, R&D expenses were 17.5 million compared to 22.5 million for the full year 2024, a decline of 22%. We continue to realize the reorganization, the benefits of the reorganization we completed in the first quarter of 2025 as we transition to a commercial growth stage organization. Sales, general, and administrative expenses for the fourth quarter of 2025 were $6.5 million, flat compared to the fourth quarter of 2024. For the full year 2025, sales, general, and administrative expenses were $26.4 million, as compared to $26.6 million for the full year 2024. We continue to exercise spending discipline and realize sales productivity and operating leverage in the business. Net loss for the fourth quarter of 2025 was $5.9 million, equating to a net loss of $0.06 per share as compared to a net loss of $10.4 million or a net loss of $0.14 per share for the same period of the prior year. For the full year 2025, net loss was $35.6 million, equating to a net loss of $0.43 per share as compared to a net loss of $40.7 million or a net loss of $0.56 per share for the same period of the prior year. The fourth quarter of 2025 and the full year of 2025 net losses includes a non-cash change in fair value of warrant liabilities recorded as a gain of $1.5 million and $800,000 respectively. Our net cash burn excluding financing in the fourth quarter of 2025 was $5.7 million, down 30% from $8.2 million in the fourth quarter of 2024. For the full year 2025, our net cash burn excluding financing was $29.9 million, down 22% from $38.4 million in 2024. Reducing our cash burn was a significant focus of ours in 2025, and we are pleased with the execution on this front. We will continue to prioritize spending discipline and optimize our operating leverage in 2026, which I will discuss in the context of our guidance framework shortly. As of December 31st, 2025, we have $35.1 million in cash and cash equivalents on our balance sheet. This is inclusive of the 18.4 million in net proceeds raised from our October equity financing and subsequent green shoe. But it is not inclusive of the 15 million initial tranche from our new long-term debt facility. In addition to the 15 million of initial funding, we have the option through the end of 2027 to access additional tranches totaling up to 25 million upon achievement of prescribed commercial targets. This additional $25 million of growth capital is not included in our cash runaway expectations. Now turning to our financial guidance. Beginning with our revenue outlook, for the full year 2026, we expect revenue between $20 to $22 million, representing year-to-year growth at the midpoint of 55%. Given the strength of our fourth quarter finish, which includes a multi-unit system-wide upgrade, we expect a typical step down in capital revenue from year-end levels. Our pipeline remains strong across our three business verticals, including several multi-unit hospital and IDN opportunities. While these deals will serve as meaningful drivers of our long-term growth and sales productivity, they typically progress over multiple quarters. We also anticipate commencing the launch of our next-generation swoop scanner in international markets in the second half of the year. As a result, we expect revenue to progressively strengthen through the quarters in 2026. Looking at gross margin, we are initiating a range of 50% to 55% for the year. We expect the progression of gross margin percentage increase to closely follow our sales growth, and we expect second half gross margin percentages to exceed the first half. We remain optimistic that we will continue the trend of surpassing 50% gross margins comfortably and sustainably as we realize higher volume driven by our growth catalyst. Lastly, we are initiating total cash burn expectations in the range of $26 to $28 million for the full year 2026, representing a 10% year-over-year decline in cash burn at the midpoint. This cash burn expectation includes debt servicing mentioned previously. From a spending perspective, we will continue to be disciplined with our spending while investing in commercially-oriented projects and will continue to operate with one U.S. sales team covering both the hospital and office market opportunities and through distributors internationally. As mentioned earlier, with the initial incremental growth capital raised in March, we now see a cash runway for the business extending into 2028. We believe we are entering an important phase of growth. having strengthened our financial profile and positioned the business as a high-growth, de-risked medical imaging platform with multiple durable catalysts across large, underserved sites of care. We have successfully transitioned to a commercial-stage business supported by a compelling value proposition, robust pricing, attractive gross margins, and increasing sales productivity and operating leverage. I would now like to turn the call back to Maria for closing comments.

Thank you, Brett. Before we open the call to your questions, I want to briefly share a call I just had with one of our customer sites. This is one of our first programs that launched with our next-generation subscanner. They purchased two units in the third quarter of 2025 and have been using the subsystem since late 2003 across critical care, the emergency department, and most recently, in a hub and spoke model with a satellite site. Today, they have performed over 200 subsystem scans, reporting a high degree of satisfaction and great clinical and economic impact for the patients they care for and their workflow. On that very positive note, we can now turn to your questions. Operator?

We will now begin the question and answer session. If you would like to ask a question at this time, simply press star followed by the number one on your telephone keypad. And our first question comes from the line of Frank Pekanian with Lake Street Capital Markets. Frank, please go ahead.

Great. Thank you for taking the questions. Congratulations on all the progress. I was hoping to start with one on the key assumptions surrounding 2026 guidance What can you tell us you're assuming in that guide as it relates to US, OUS, anything, any color around multi-system unit ordering? I'm assuming there's a price component in there given the MSRP you quoted throughout the call. And then anything else we should consider as we're thinking about how you built the guide for 2026?

Thanks, Frank. This is Brett. I'll take that one. So, yeah, the way we built 2026 is really tied to the growth catalyst of the business. I think you commented on a couple of them. We have three business verticals that comprise, you know, the revenue stream that we've modeled out and are predicated in our guidance. In the hospital side of the business, you're right, the multi-unit systems and the IDNs will play out over time. I think, as we mentioned, those take several quarters. So as the year progresses, we'll see more and more of those in our financial numbers. The office business, which we launched in the middle of last year, will continue to see traction on that in regards to the neural PMR data as well as the penetration into that space. And then international, we commented in there that we've got a second-generation scanner that we expect in the second half of the year. So really taking all those pieces together, we see a progressive strengthening of the top line throughout the balance of 2026. Bigger deals obviously are tied to budgetary processes, and so those will probably play out more in the second half of the year, but we will see a progression of the top line starting in the beginning of the year and then continue to strengthen throughout the year.

And maybe on pricing and high frank, we did comment on the MSRP at $590,000, so that is something that changed. So we increased it from 550, which was the pricing at the launch of our Model 2, and moved it to 590 at the beginning of the year. That is primarily in our U.S. hospital business. We also commented on the fact that we are doing pricing segmentation and using both Model 1 and Model 2. in the office because not all offices are made equal. Some are single practitioner, relatively small, and the volume doesn't support the model two. So we're using model one at a different price point in the office setting. And last but not least, of course, internationally, since we operate and transact through distributors, we're doing that at distributor pricing. So not different than previously, we do have the blended a combination of all of those that ends up being our ASB. But we continue to see the health and the improvement just because there is one of the business verticals, which is the U.S. hospital that is predominantly Model 2 and is enjoying sort of the advantages of the price increase. The reason for mentioning also 590 in the prepared remarks was that When you run really the ROI calculation, given the economic impact data that was recently published with any hospital, even at a 590 pricing, you do get to that one to one and a half year ROI, which makes it incredibly compelling from an administrative standpoint.

Very helpful color. I was hoping on the second one, I could ask a little bit more about the pipeline. I think in the Q3 call, you've referenced the Hyperfine pipeline being at its strongest and most diversified. Following a really strong Q4, would you say that that comment still holds true? Or are you still in the camp of building up the funnel in the front half of the year?

So the comments around the pipeline continuing to be the strongest we have ever seen is very true. It is also very true that it is comprised of more multiple deals and more IDN deals. We have several deals with big IDNs in progress. It is also true that those deals are a little bit more now mainstream procurements. and in some cases dependent on budget year. So remember, we were really stealth before the introduction of Model 2, so when it launched in June of last year. Truly the very first budget year that we are able to take advantage of is the one that kicks in July 1 for a lot of the hospitals. So I think we've commented that some of these bigger, more strategic multiple deals are actually a little heavier in process and may create some variability. There is something also that happened in Q4, which is a for-revenue upgrade of an institution where we had multiple systems and they wanted to standardize and move their install base to Model 2. That is probably a one-time event as it relates to Q4 that I'm not seeing in sort of the forecast for every quarter going forward. So hopefully that gives you color around how we're looking at the pipeline. Incredibly robust and totally full with very big idea names, multiple deals, but those come with a little bit more process and the budget year being more naturally that July to the end of the year is something that may create this sort of progressive strengthening of our revenue line over the course of the year.

Very helpful. If I could sneak one in. When you speak about the multi-unit orders, my assumption for Q4 is maybe that was single digit but multi-unit. Is there – one, is maybe that accurate, if you care to comment on that? And then two, as you look at some of the multi-unit deals in the pipeline, is there potential for double-digit multi-unit deals?

Double-digit number of deals or number of units?

No, I think I understand your question, Frank. Number of units per deal. Yep. When we talk about multi-UN, you can think about things two ways. One is an individual hospital where there is multiple placement opportunities. So, for example, someone might want to have it for both critical care in the emergency department and maybe pediatric and adult in the case for critical care. So you might have three or four placement opportunities in an individual hospital. And then when you talk about an IDN, IDNs obviously are multiple hospitals. The deals will likely not be all the hospitals at once, but it will probably start at one of the hospitals, but then we'll go across the IDN network where they will want to standardize care. So over time, that could be, but really in an individual quarter, we're talking about single digits at an individual transaction level.

Got it. Very helpful, Connor. Thank you.

Thank you.

And your next question comes from the line of U1Z with B Riley Securities. So, U1, please go ahead.

Thank you for taking our questions and congrats on a strong 2026 guidance. Maria, the business has its ups and downs over the past couple of years. I think it will be very helpful to investors if you can provide a quick review, especially, you know, what we have learned that can be used for the current business momentum.

Sure, thank you, Yuan. So I think we have defined our technology as portable brain MRI, but the real product that we offer is high-quality imaging that is accessible, affordable, and easy to get. And I don't believe in the last few years we were there until the introduction of both the Model 2 as well as the Optiv AI software. So I have personally witnessed an incredibly sharp change towards endorsement and approval of our technology and interest in our technology as we have brought up substantially the image quality all the way to what we have now said, which is very, very close to high-field MRI. So the clinical value has now been totally transformed into something that is a very useful tool. I know I commented on a small anecdote on one important new account with Model 2, but the reality is they're using it all the time as a go-to tool for the triage of their patients with suspected stroke symptoms, and they're doing it at a spoke level. institution as well as they're doing it in their ED, and they are able to make clinical decisions every day. Our technology wasn't there when we started. We were portable, we were low field, but our imaging was not at the level of clinical decision making. So I have a totally different appreciation for the opportunity now that we have established that base of clinical utility. And I have also witnessed, because of this high level of image quality now, an interest to take our unit, to take our technology into even more use cases and sites of care than we have planned thus far. I know I've mentioned mobile. I know I've mentioned surgical. But those are places where we are being pushed, where we are being asked to play, because the technology now offers that great combination of high clinical value with that access, affordability, ease of use component, safety component, pretty much anywhere. Does that make sense? I really think we're leaving behind a development phase of getting to that level of clinical utility as we have refined and improved, really, the image quality.

Got it. Yeah, that's very helpful. Maybe one question for Brad. I noticed the service revenue is lower in fourth quarter. As we imagine, you know, you have more devices in store. The service revenue should grow year over year. So can you please provide some additional color on that?

Yeah, thank you, Yuan. Yeah, so you would expect service revenue to, you know, progress over time, and that is the long-term trajectory of that line item. In Q4, we mentioned that we had done some forward technology upgrades, and as part of that, we had to go through an accounting contract assessment, and there's some adjustments in the service line item related to that, but going forward, you would expect that trajectory to be what you had articulated.

Got it. Yeah, that's all from my side. Thank you. Thanks.

Thank you.

There's no further questions at this time. I'm going to turn it back over to Maria Sainz for closing remarks. Maria?

Sure. Thanks, everyone, for joining us today. We look forward to keeping you updated in the next several weeks. Thanks, everyone, and have a great rest of your day.

That concludes today's call. You may now disconnect.