NANO-X IMAGING LTD

Good day and thank you. Welcome to the Nanox Imaging Second Quarter 2022 Earnings Call. At this time, all participants are on a listen-only mode. After the speaker, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Mike Cavanaugh, Managing Director of Investor Relations. Please go ahead.

Good morning and thank you for joining us today. Earlier today, Nanox Imaging Limited released its financial results for the quarter-ended June 30, 2022. The release is currently available in the investor section of the company's website. Eris Meltzer, Chief Executive Officer, and Ron Daniel, Chief Financial Officer, will host this morning's call. Before we get started, I would like to remind everyone that management will be making statements during this call that include forward-looking statements regarding the company's financial results, research and development, manufacturing and commercialization activities, regulatory process operations, and other matters. These statements are subject to risks, uncertainties, and assumptions that are based on management's current expectations as of today and may not be updated in the future. Therefore, these statements should not be relied upon as representing the company's views as of any subsequent date. Factors that may cause such a difference include, but are not limited to, those described in the company's filings with the Securities and Exchange Commission. We will also refer to certain non-GAAP financial measures to provide additional information to investors. A reconciliation of the non-GAAP to GAAP measures is provided with our press release with the primary differences being goodwill impairment, change in obligation in connection of a merger and acquisitions, stock-based compensation, amortization of intangible assets and class action litigation, and SEC inquiry-related expenses. I'd now like to turn the call over to Eris Meltzer.

Thank you, Mike, and thank you all for joining us on the call today. As always, we appreciate your continued support of Nano-X. As in our last call, I will give an overview of our recent achievements and share our outlook on the coming months before turning the call over to Rand Daniel, our Chief Financial Officer, to review our financial results. We will then open the call up to questions. We've continued to make progress during the past quarter to advance the Nano-ARC system towards commercialization, and we continue to proceed full force ahead to make headway in the FBA clearance process. On the call today, I will discuss the advances we have made since our last earnings call by breaking my comments into three distinct segments, regulatory, commercialization, and finally, AI and teleradiology. I will discuss what we have done in each of these segments and how we have moved closer to our goal of system deployment at scale. Before I do that, I'll touch on our financial results at a high level, but we'll leave most of the details to Rand's commentary later in the call. NanoX generated top-line revenue of $2.2 million in the second quarter of 2022, compared to $1.8 million in Q1 2022. As in the previous quarter, all revenue was generated by NanoX Tellurideology Services Business Unit and by NanoX AI, our deep learning machine analytics company. As most of you know, these business units began generating revenue since their acquisitions in November 2021. and it's gratifying to see our teleradiology services growing quarter over quarter. These revenues, while relatively small at this time, are important for two reasons. First, they help us to improve our cash flow and its management, and second, we believe they demonstrate that customers and other stakeholders, such as hospitals and integrated health systems, value these services, which in turn strength our belief that these applications and services will add value within our multisource system when integrated with our proprietary imaging technology. I'm happy to report that during the second quarter of 2022, we signed 14 new client agreements for teleradiology services. Our clients in the teleradiology segment include hospitals, outpatient imaging centers, urgent cares, multispecialty physicians group, research facility, and mental health facilities. We continue to see accelerated revenue growth in our teleradiology services, driven by new client additions, as well as organic growth from existing clients. The AI solution business continued to gain traction both in the U.S. and abroad. For example, Lennox had their first go-live at five Northwell health outpatient centers on July 26th. followed by South Shore Hospital on August 8th. Additional hospitals and outpatient sites throughout the system are anticipated to go live through the remainder of August and into September. In addition, we previously reported a large strategic agreement with one of the leading IDNs in the Northwest of the US to use our AI population health solution. We can now share that this customer is Spectrum Health. an integrated healthcare network based in Michigan with 15 hospitals and health facilities. I'd now like to discuss our progress on the regulatory front. Beyond the beneficial revenue streams I just mentioned, we made further progress in our efforts to gain FDA clearance for the Nano-XARC multisource system. Recently, we received feedback from the FDA on our Q submission supplement that we previously submitted to the agency. The feedback we have received has been valuable, and it's helping us to optimize our 510 submission. Subsequently, we are now preparing our 510 submission to the FDA for our multisource NONUX ARC, which we expect will have the full power levels and indications that we believe will result in a successful deployment of the Nano-X Arc. In parallel, we are preparing for global deployment of our multi-source Nano-X Arc, according to local regulations and subject to requisite approval in each market. Without any regulatory efforts to obtain the CE mark for Nano-X Arc, we have submitted all necessary documentation to begin the process for CE marking. We look forward to providing additional updates as this process advances. Moving on to commercialization. We have continued to progress our commercialization of the multi-source Nano-X Arc in several areas. I'm happy to announce that we have taken steps to advance deployment of the multi-source Nano-X Arc in Nigeria. In April, we sent a preliminary deployment team to be on the ground there and are preparing to send our first commercial unit for demonstration and training purposes. Our shipment plan to Nigeria is progressing hand-in-hand with the local regulation process. I also have the pleasure to announce another new agreement that we have signed recently with a distributor in Ghana, under which we agreed to deploy 350 units subject to local regulatory requirements, which brings our total contracted units to 6,850 worldwide. This is a great milestone for the company, and we are pushing forward on the development and the deployable system to fulfill these orders. We believe that once we begin to deploy the multisource NanoXARC in Nigeria and other early adoption area, health systems, hospitals, and distributors will see the service that the NanoXARC provides. and that we will then begin to fulfill the backlog of orders we have built up. In addition, we have an agreement in place with a non-governmental organization, BioVentures for Global Health, known as BVGH, for developing and implementing a medical imaging training initiative in Nigeria. BVGH is a Seattle-based nonprofit organization that strategically develops and manage programs across the for-profit and nonprofit sectors to accelerate research and development for poverty-related diseases, build biomedical R&D capacity in low- and middle-income countries, and improve cancer patient care in Africa. Some new collaboration and developments. I'd also like to take a minute to announce another milestone on the path to commercialization that we are excited about. We are in the process of establishing a technology development center based in Israel to develop the chips and the tubes that will need for the nonics art in the years to come. This center will be complement our facilities in Korea and Japan. To close my remark, I want to thank the Nanooks team for all their hard work and progress achieved in this quarter. But most of all, I want to thank all our investors for their continued support for our mission to democratize healthcare by making imaging affordable and available anywhere in the world. We look forward to reporting more progress on our next earnings call. With that, I would like to turn the call over to Rand Daniel, Chief Financial Officer to review our financial results.