icad inc.

Good day and welcome to the ICAD Inc. Second Quarter 2021 Earnings Call. Today's conference is being recorded. At this time, I'd like to turn the conference over to Mr. Jeremy Suffer with LifeSci Advisors. Please go ahead, sir.

Thank you, Anna, and good afternoon, everyone. Thank you for participating on today's call. Joining me from ICAD are Michael Klein, Chairman and Chief Executive Officer, Stacey Stevens, President, and Charles Carter, Chief Financial Officer. Earlier this afternoon, ICAT announced financial results for the three and six months ended June 30th, 2021. Before we begin, I would like to caution the comments made during this conference call by management contain forward-looking statements, involve risks and uncertainties regarding the operations and future results of ICAT. I would also note that management may refer to certain non-GAAP financial measures. Management believes that these measures provide meaningful information for investors and reflects the view, the way that they view the operating performance of the company. You can find a reconciliation of our gap to non-gap measures at the end of this earnings release. I encourage you to review the company's filings with the Securities and Exchange Commission, including, without limitation, Forms 10Q and 10K, which identify specific risk factors that may cause actual results or events to differ materially from those described in the forward-looking statements. Furthermore, the content of this conference call contains time-sensitive information that is accurate only as of the date of this live broadcast, August 5, 2021. ICAT undertakes no obligation to revise or update any statements to reflect events or circumstances after the date of this conference call. With that said, it's my pleasure to turn the call over to Michael Klein. Mike?

Thank you, Jeremy, and good afternoon, everyone. I'd like to begin by highlighting several key aspects of ICAT's second quarter performance, as well as provide a brief snapshot of the current business and operating conditions as we move into Q3. As presented in our earnings release, ICAD's second quarter total revenue was $7.8 million. While this was a 41% increase over the second quarter of 2020, second quarter 2021, total revenue was negatively impacted by longer than expected enterprise sales cycles, which impacted the timing of several large accounts. We began to close some of these longer cycle deals in July. While we anticipate that the longer enterprise sale cycle will continue to be a meaningful component of our pipeline, the addition of these enterprise sales will increase our addressable market and average deal size. To be clear, the longer cycle deals that didn't close in Q2 were not lost to competition, which we continue to see little evidence of, and the slippage of some larger enterprise deals in Q2 are well-qualified customers actively seeking ICAD's detection and risk assessment AI solution and have dollars budgeted and allocated for purchase. And as stated, July was a successful month of capturing several of these important deals. It is worth spending a moment to detail the makeup of these enterprise deals and how we are evolving our commercial infrastructure, personnel, and go-to-market strategy to efficiently secure them. We have been tracking the emergence of this unique customer segment as it has become more prominent in recent months. These are typically large and often geographically diverse accounts. Their decisions on healthcare procurement are driven by a commitment to enhancing workflow productivity among a large number of stakeholders. Overall quality, consistency, and even uniformity of care and measurable ROI's are outcomes that are essential to enterprise customers. In sum, enterprise customers represent a unique linkage or triad of economic, clinical, and now technical decision makers, typically with the title of chief technology or chief information officer. We'll refer to the latter as CIO. While an additive and often helpful upstream call point, the inclusion of the CIO in the enterprise deal decision process can and has moderately extended our sales cycle. The emergence of the CIO in enterprise deals, however, presents us with a highly receptive, AI-centric, and knowledgeable customer that provides a clear advantage to ICAC. The CIO, or titles similar to it, represent a new category of final decision makers that understand the nuances and advantages of AI software, and importantly, the difference between a clinically validated and algorithmically based solution. This allows us to speak a common language, engage in more informed discussions, and allows us to even illustrate our performance superiority, productivity yields, and broad healthcare economic value proposition across all of ICAD's profound AI offering. And as just one example, one of the reasons that we are encouraged by the emergence of IT or the Chief Information Officer and enterprise customer is their high receptivity to our new risk offering and its importance across not only clinical and patient constituents, but to all C-level stakeholders. Our risk offering allows screening sites, clinicians, and patients to look one to two years ahead and determine level of patient risk of breast cancer. The patient could then be assigned unique screening regimens with higher risk patients scheduled with unique personal protocols and with more frequency than lower risk patients. The result is more cancers found, earlier intervention, and an improvement in healthcare economics across the spectrum from providers to payers to patients. Enterprise customers will be a priority call point for our new 3D risk assessment offering that we are very excited to announce today will be released in this quarter. We have carefully curated the release of this 3D risk AI offering based on our experience with 2D risk. We intend to significantly promote this offering in September and October to align with Breast Cancer Awareness Month in the fall. It is worth repeating that ICAD is unique in the market as the only vendor for a look into the future risk assessment AI offering for both 2D and 3D mammography. It provides sites with the ability to identify problematic cases one to two years before breast cancers may be discernible to the naked eye or is even detectable on software that looks only at today's age. Now, moving on to our therapy business, we continue to be pleased with the performance from this segment in both product and service revenue areas. Total therapy revenues of $3 million represents a doubling of revenue over Q2 of last year. Year over year product revenue increased by 600% from Q2 2020, while service revenue increased 31% as compared to Q2 2020. For a business that has 50% of its revenue derived by recurring follow-up sales, the high volume of new installations in the first half of 2021 is an encouraging lead indicator for increased recurring revenues as we look ahead. The growth in our therapy business was driven by several factors, including the sale of nine controllers in Q2. The majority of ZOFT products in Q2 were due to the continued surge in dermatology controller installations, which are being heavily influenced by the emergence of positive shifts in reimbursement payer coverage, and regulatory changes. Stacy will provide additional detail on this in a few minutes, as well as highlight the timing of our full commercial launch into neurosurgery with our treatment for glioblastoma. Let me add that in spite of the dramatic increase in the number of COVID Delta variant cases, we anticipate minimal impact on our order patterns. For MAMO screening sites, clinicians and patients, It comes down to simple math. As we head into month 18 of COVID and the resultant rolling screening delays and backlog, all healthcare professionals, clinical sites, and societies strongly agree that breast cancer risk and incidence vastly exceeds the probability of Delta variant-related disease severity, hospitalization, and or mortality rates. As such, now more than ever, continuing and even accelerating catch-up screening, particularly for high-risk patients, is essential. Not doing so with the knowledge that delays lead to more advanced cancers and greater cancer occurrence could emerge as one of the more detrimental long-term impacts of this pandemic. I'd like to mention, however, that the COVID pandemic has enhanced an already hard-coded core competency within ICAT. This is our ability to appropriately and prudently manage cash. With just under $38 million of Q2 ending cash and all debt paid off, we see ourselves continuing on prudent approach to spending while enhancing our commercial position and technology leadership. Productivity tools and techniques refined during COVID will continue to be a part of our managerial repertoire. I'd like to use this call to announce three key new members of the ICAT team. All three will be integral in maximizing and balancing our productivity and commercial yield with a strong cost-effectiveness orientation. The first of these is Charlie Carter, who after three months as our interim CFO will now serve as our full-time CFO. Charlie is a highly seasoned executive with both public and private company CFO experience, and we are thrilled to now have him on our team. I'd also like to announce Jeff Sirich as ICAD's new Chief Commercialization Officer. Jeff has run commercial operations at ZOFT for the past four quarters and has highlighted in our financials was successfully responsible for taking previously lumpy Zoff sales and has generated consistent and predictable sales momentum while demonstrating the highest level of commercial and operational acumen. Jeff's unique experience both at Zoff and in prior senior positions, particularly ones with very large account exposure with enterprise-like characteristics, makes him a particularly good fit at this time in our growth. We are also pleased to announce the appointment of Brian Testa as Chief People Officer. Brian has extensive experience in supporting organizations in building efficient, scalable, and high impact outcomes into their processes and culture. In his tenure with the company to date, he has played an essential role in expediently executing the high octane transformation of our commercial capabilities while also bolstering our innovative edge and our high productivity game plan. After a quarter of unique, well-defined, and transient dynamics, we see ourselves as better equipped for our next phase of commercial adoption. Our continually improving commercial team led by individuals with clear track records of proven sales success, combined with hard-coded prudent management of operational expenses, all added to the continued release of new innovations, such as 3D risk, this quarter will allow us to continue our success trajectory. I'd now like to turn the call over to Charlie for his review of the financials. Charlie, congratulations on officially joining the team, and please take it from here. Charlie?