Perimeter Medical Imaging AI, Inc.

Good afternoon, ladies and gentlemen, and welcome to Perimeter Medical Q1 2026 conference call. At this time, all lines are in a listen-only mode. Following the presentation, we will conduct a question-and-answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. This call is being recorded on Thursday, May 28, 2026. I would now like to turn the conference over to Stephen Kilmer, Investor Relations. Please go ahead.

Thank you. Good afternoon, everyone. Let me start by pointing out that this conference call will include forward-looking statements within the meaning of applicable securities laws. These may include statements regarding the future financial position, business strategy and strategic goals, commercial activities and timing, competitive conditions, research and development activities, projected costs and capital expenditures, research and clinical testing outcomes, The potential benefits of our products, including Perimeter S Series, OCT, and CLAIRE, formerly Perimeter B Series, OCT, Perimeter's ability to broaden its user base and system utilization, expectations regarding new products and the timing thereof, and expectations regarding opportunities for market expansion. Forward-looking statements are subject to numerous risks and uncertainties, many of which are beyond our control, including the risks and uncertainties described from time to time in our public filings and press releases, which are posted on CDER+. Our results may differ materially from those projected on today's call. No forward-looking statement can be guaranteed. Perimeter undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, other than what is required by law. On the call, representatives of the company are Adrian Mendez, Perimeter's Chief Executive Officer, Sarah Bryan, the company's Chief Financial Officer, Abby Goodman, Perimeter's VP of Sales, and Andrew Berkley, Perimeter's chief innovation officer and co-founder.

With that said, I'll turn the call over to Sarah.

Thanks, Steve. Good afternoon, everyone, and welcome to our first quarter 2026 conference call. On behalf of the management team and everyone at Perimeter, I would like to thank you all for your ongoing interest in our company. For those of you who are our shareholders, we appreciate your continued interest and support. Before turning a call over to Abby to provide a commercial update, I'd like to provide a brief update on our financial results. To streamline things, all the numbers I will refer to have been rounded so they are approximate. So as a reminder, we report in US dollars. For the three-month period ending March 31st, 2026, the company recorded revenue of $385,000. with a full amount coming from recurring revenue, which consisted of the sale of S-series consumables and system leases, as well as from the sale of ESP warranty programs. Recurring revenue grew 14% year over year compared to Q1 2025. As a reminder, in Q1 2025, we recognized $230,000 from one-time sale of S-series capital equipment that was included in the total quarter revenue of $550,000. Operating expenses for the three months ended March 31st, 2026 were down 3.2 million, over 3.2 million down 30% from 4.6 million in the same period in 2025. First quarter 2026 net loss was 3 million or 0.2 cents per common share, a 31% improvement compared to 4.3 million. or 5 cents per common share in the three months ended March 31st, 2025. Cash used in operating activities in Q1 2026 was 2.2 million, 41% decrease compared to Q1 2025. As of March 31st, 2026, cash was approximately $421,000. This amount did not include any of the approximate 7.5 million in gross proceeds that the company raised from the April 2026 first tranche closing of the debenture offering, which is still to be completed, nor from successfully completed May 2026 life offering. With that, I'll now turn over the call to Abby.

Abby?

Thanks, Sarah. And thanks again, everyone, for your time and attention today. As many of you know, this is my first time participating in a perimeter investor call. But I know we have talked often in the past about how our goal in 2025 was to seed the market with our legacy S-series OCT in order to create a strong network of early adopters and technology champions in preparation for potential FDA, PMA approval, and subsequent rollout of our next generation Clare OCT plus AI device. Though our commercial team has been and remains relatively lean and mean, it did achieve that goal. And the positive momentum we built throughout 2025 translated into strong recurring revenues in the first quarter of 2026. This was despite our being in what can be best described as a transition period following the March 2026 FDA PMA approval of our next generation clear device. While I just described this as a typical transition phase between selling a legacy and a next generation device, we are actually thinking about it more as an inflection point. One that marks entering into what we believe will be a phase of rapid growth supported by potentially game changing innovation. Since this is my inaugural perimeter investor call, let me provide some color on our pipeline to help illustrate that. Today, at the top of our CLAIRE sales funnel, there are close to 50 qualified leads. Of those, more than a dozen are currently classified as being within one of the prospecting, developing, validating, and contracting stages. There are two things I'd like to highlight here. First, our sales funnel consists of a mix of current legacy S-series users looking to upgrade to CLAIRE at a higher per procedure AFP due to the AI, and brand new users who are looking to use OCT in the operating room for the first time. Second, it's important to note that we couldn't even talk with any potential Clare customers before we received FCA PMA approvals for the technology at the beginning of March. We obviously can't guarantee all of the qualified leads, even those at the last contracting stage will result in final installs before the end of the year, if ever. But we believe reasonable assumptions and basic math drive our confidence that we will start to see commercial traction with Clare to grow in the second half of the year. We aren't relying on hope or probability models. We have taken the opportunity to plan out how to drive and support the next stages of our growth. Today, we've organized geographically around a small handful regional sales hubs and our commercial team consists of three groups of sales professionals. Market development folks, who as the title implies, are responsible for new capital sales and demand creation. Clinical sales specialists, who own the account once CLAIRE is installed and are primarily responsible for surgeon engagement and utilization ramp in their territory. And clinical application specialists, who have primary OR case coverage. Like with many MedTech companies, we aren't giving granular detail on the number of hubs, nor on the team size and or makeup that service them. But I can say that we expect to grow proactively and methodically, expand our sales organization across the country as we grow. Thank you again for your time. I will now turn the call over to Adrian to wrap things up.

Thanks, Abby. All right, it's an exciting quarter.

So to summarize what you just heard, we saw yet another period of positive commercial traction driven by our legacy S-Series product, as demonstrated by our 14% recurring revenue growth in the first quarter. At the same time, we continue to carefully manage our resources as we grow. As a result of our cost control efforts, we were able to reduce operating expenses by 30%, operating cash burn by 41%, and the net loss by 31%, respectively, in the quarter. We received FDA PME approval for our next generation AI-enabled Clare device in early March. And since then, our sales team has already built a Clare sales funnel of close to 50 qualified leads, with over a dozen of those classified as being within the active management stages of the pipeline. We plan on methodically and opportunistically expanding our commercial team to drive growth without getting too far ahead of it. And finally, pulling all of this together, We believe we are at a pivotal inflection point in our business and on the cusp of entering into a stage of anticipated rapid growth. It's an exciting time for us, and we look forward to keeping updated on our progress. And with that, I'll now open up the call for your questions. Operator?

Thank you. And ladies and gentlemen, we will now begin the question and answer session. To ask a question, you may press a star followed by the number one on your telephone keypad. If you're using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press the star followed by the number two. Once again, that would be star one if you would like to ask a question.

One moment, please, for your first question. And our first question comes from the line of Scott McCauley with Paradigm Capital.

Please go ahead.

Afternoon, everyone. Thanks for taking the questions and welcome to the call, Abby. Great to hear from you. First of all, great to hear that there's two CLAIR systems already up and running in facilities in the States. Quick question, have they performed any procedures yet with the device? And maybe a bit of detail in terms of the process of getting them set up, like were they Have they already put up their hands before the approval? How long did it take to go through the procurement process? Any of those kind of color would be interesting.

Hey, Scott. Yeah, thanks for the question. So it really has just happened. So there have been no procedures on it yet, on those machines, yes. But we'll keep you posted as that happens, which shouldn't be, I mean, it shouldn't take too long now for that. These were existing customers, so it's quicker than as if it were a brand new customer, of course. Obviously, all our existing customers were aware of what we were working on from an AI perspective ahead of the FDA approval, but we couldn't really actively engage with them in terms of getting those conversations started until that happened in March. Um, so it was, it was quicker than a brand new customer, but really we only could start engaging with them, um, after, uh, you know, after the FDA approval. So, um, that's kind of the timeline from beginning of March till now for us to get this first one through. Um, but you know, there's a deep pipeline as you've heard about. And so we expect to, uh, be talking about more of those, hopefully in the not too distant future.

Yeah, that's, that's great. And maybe on that pipeline, so we get to hear, That pulls kind of the top and at least midpoint of the funnels. And, you know, kind of two months from, you know, engagement to installation. So maybe a bit more on kind of timelines, how you see things moving through that pipeline and maybe comparing, you know, getting a new site up and running versus converting old sites. And if there is any kind of quantification around, you know, are these majority sites um, transitioning, uh, existing sites or majority, um, you know, completely new sites, uh, kind of any other color on the makeup of that pipeline would be, uh, interesting.

Yeah, no, it's probably, um, um, it's a mix.

It's a mix of both new and existing. Um, and it's, it's fairly balanced between the two. Um, the process, maybe I'll just talk a little bit about the process of, of how, you know, the folks that are already customers, have some experience with the way OCT and the S-series works within their workflow. So from a clinical standpoint, the idea of having the image assistant helping with that, it fits very nicely into the workflow. So what that process ends up looking like is much more of working with the administration because the pricing model is different. We're obviously charging more for Clare than we were for the S-Series to capture the value of what the AI system brings. So there's a renegotiation of, or a negotiation, I should say, of the conversion over to the next generation, onto Clare. So that's where the work is on that respect. But because the clinician is already used, the physician's already used to using the basic technology, it reduces that portion of the sales cycle. Now, the other portion of the pipeline are those physicians, so surgeons that have been aware of our S-series, have been looking forward for us to release Claire, and then now are engaging with us from that standpoint. Many of them have been through, like have seen our product in operation, either in the field or in, or at like conferences, ASPRS and others. So they have some feel for what it looks like. But if they're new, they haven't actually had it inside their workflow themselves personally. So for those sales, it's a little bit longer. Awareness is there. So we can kind of fast forward to the awareness stage and the understanding of what that means from an impact standpoint. But really part of that process is also getting the surgeon comfortable with the machine inside their operating room and fit into their workflow. So a little bit longer on that standpoint. So as we look at the entire pipeline, opportunities moving through the pipeline from now through the rest of the year and beyond, I think what we'll see is a mixture of current conversions and new customers, you know, current customers converting and new customers intermixed going forward at different rates as we can move them through that pipe.

That's great. Any details on that economics? So, you know, how much more you are able to charge on the consumer basis for the AI and how that thinking is evolving?

Yeah, so we're testing and we've been able to sign, obviously, you know, been quoting and getting business done at a price that is, it's, you know, it is not going to be at the same rate. So it's going to be, you know, relatively higher, significantly higher, let's say, than the S-series pricing. So we're not talking about specific pricing at this point. as we are testing out the markets. But I think you'll be able to see as the financial starts to come through, you'll start to see a significant uplift in our revenue model and our margins based off the pricing on the new product.

That's great. Maybe in the number of procedures for Q1, gross year over year, but in the consumable revenue, but down quarter over quarter, would you say that the actual number of procedures performed in Q1 was kind of equivalent or more than in Q4, and it's just a kind of timing of ordering or anything like that that kind of drove that change in the consumable revenue?

Yeah, it was down slightly from Q4 to Q1. There is some seasonality built into that, of course, with the way economics and people's health plan stuff coverage work. Q4 ends up being a very large quarter, both because of breast cancer awareness month and then people trying to get through the deductibles. It was down quarter and quarter, but Q2 is looking to be right on track again.

We're seeing that bounce back now. That's great.

Maybe on expanding the team, I know that there's a number of positions posted and how you're finding qualified people come in. You're happy with the quality of the candidates and excited to bring them on and let them loose on the pipeline?

Yeah, so there's a couple of things in terms of team growth. One is we're being very cautious on the speed at which we grow the team. You know, what we don't want to end up is in a failure mode where we hire too quickly, expand too quickly and end up having efficiency go down because we've got so many new folks on board, number one. And number two is We're a small company right now and we've got a small sales team, but we do want to preserve the culture and make sure we're managing that culture appropriately. And so the best way to destroy culture is just hire way too quickly and get overwhelmed. So there's a pacing item from just a core building out the company strategy. And then in terms of, but we have lots of candidates that are, you know, would love to work in the technology, work with us. And so that's been great. We've had those jobs out there and we're getting a very strong sort of flow of candidates through. But the flip side is we're also being quite selective in who we want to bring onto the team. As a company at the stage we're at right now, which is early stage, We really need, you know, the people you bring up early in a company are the ones that sort of define your culture and the way your company is going to work going forward. So these early folks are so important for us. They have to be able to work in a startup environment. They have to be able to be dynamic. They have to be willing to learn and develop sort of develop the playbook, so to speak, as we say internally, as we go expanding this project. We're also making a market. You know, margin assessment for breast cancer is not a market that currently exists out there. So we're creating it. um something where there is nothing so that takes a very unique sort of person um and so we're holding true to that right making sure we're getting the right people in the inbounds have been great we've got a lot of applicants uh we're very selective of who we actually you know get into the company that's great and uh finally it's not holding the mic too much um you know outside of uh just kind of progress on uh you know installations and utilization

kind of any kind of key things that you're looking at or working on kind of for the balance of the year that we should be looking out for, maybe reimbursement or anything else?

Yeah. Yeah. So obviously just commercialization, getting customers, expanding our customer base and procedure counts, et cetera, has been, it's going to be the major focus for us. We are working on reimbursements. And so we're getting ready to launch an application with CMS here in the next few days with the hope that that, you know, that gets into place by early next year. So we're feeling pretty good about that process. So that's another, you know, that'll get launched. And then, of course, there's an interactive period with CMS over the next few months as that application goes through. We have breakthrough device designation, which helps our ability to get to a reimbursable state. much quicker than if we did not have that. So that's a focus for us, and that's, again, in service of being able to accelerate revenue growth and commercial traction as we enter into 2027. So I think those are the two major things. Of course, we're always cognizant of capital. We're coming off a raise that we just completed a few weeks ago, which gives us that firepower to be able to go and expand, so that's great. But we're always managing that and have our eye on that ball as well. So I think those are the three major areas that we're focused on at this point.

That's great. Thanks, Adrian and the team. Congrats on all the progress today, that FDA approval.

Great stuff. Thanks, Scott.

And once again, if you would like to ask a question, please press the star 1 on your telephone keypad. The next question comes from the line of Michael Freeman with Raymond James. Please go ahead.

Hey, Adrian, Sarah, and Abby, good to hear from you. The first question is related to the financing, as you just mentioned. I wonder, should all the financings close as expected, what we should anticipate for total liquidity following the close of all those deals?

Sarah, do you want to take that question?

Yeah, sure. Hi, Michael. How are you? Yeah, I mean, our expectation is that the capital raised and anticipated cash into the business this year from revenue will give us a 12-month runway. So hopefully that answers your liquidity question.

Are you able to put a round number on that, or is that all you can say?

We announced, what, $7.5 million for U.S. dollars raised to date. We're expecting to close. We've already press released an announcement of another $2 million from Social Capital. We're just waiting to close out the venture on that, so it'll be north of the $9.5 million.

Okay, thank you. Now, on the... On the approval for CLAIRE, there was room in the, it left room for you guys to push AI model updates. I wonder if you could describe, I guess, how meaningful this is for you, plans for future model updates in the next little while and how they might expand the capabilities of the CLAIRE today.

Yeah, thanks. That's a great question, Michael. Okay, so yes, you're correct. As a part of our FDA approval, we also had approved what's called a pre-determined change control plan or PCCP. And what that allows us to do is get authorization from the FDA to make changes that they pre-approve. And as long as we follow the balance around what those changes can be, we can make make those changes and deploy them without having to go through another review cycle. So we had that, we got that applied to our AI algorithms. So what it doesn't mean is that we've got free reign to do whatever we want to with our AI models. But what it does mean, it still gives us a lot of room to maneuver in what we can do. So we can add more data to training. We can update our algorithms using the same basic architecture. And we can make those changes, you know, kind of as we go through our processes, we can release them and follow our normal release procedures for changes of the product. We got the version of the software that we ran the trial on, it's what we called ImageAssist 2.0. That was developed some years ago before the trial started. And that's what we have been frozen to through the FDA approval cycle. But of course, our AI team has been working on next versions of that. So we got approval on early March. And by early, no, late April, we had our next generation version of that available and on the machine. In fact, that's what we demoed at the ASPRS conference a few months or a few weeks ago. which had significant improvements over what the first generation was, right? So, you know, the two key things are, are you able to, is your algorithm able to find more of what it's looking for? In our case, suspicious areas within the images. And can it find less false positives? So, you know, like filter out more of this stuff that looks like it might be an issue, but isn't. And we made great improvements, 20 to 25% improvements in both of those metrics as we went from the algorithm that was in the trial to what we now have on machine. We do see, we do have a roadmap of continued improvement on where we are right now over the rest of the year as we gather more images, as the AI team improves the algorithm. So we still feel like there's still more, you know, more juice to squeeze from the lemon from the PCCP, even without having to go to, you know, through a whole nother review cycle. And that's, we're super excited about that because the speed at which AI moves, you know, we want to be, kind of following that as closely as we can. So, yeah, it's a big part of our strategy for product improvements, definitely.

That's great. I mean, 25% improvements on the algorithm. Super meaningful. So thank you for sharing that. Okay, those are all my questions. I'm excited for this company. I'm excited for patients. This is a big deal, this being on market. I'll leave it there.

Thank you. Thanks, Michael.

And I'm showing no further questions at this time. I would like to turn it back to Adrian Mendez for closing remarks.

All right, thank you. So the first quarter of 2026 marked a critical milestone for Perimeter. That was highlighted by the FDA PM approval in March, the approval of our next generation Clare OCD plus AI platform. This achievement represents a major validation for clinical, regulatory, and technology development efforts. and positions us to advance to the next phase of our commercialization strategy, which is focused on scaling adoption. During the first quarter, we continue to generate strong year-over-year growth in recurring consumable revenue from our legacy S-Series installed base, which we believe demonstrates the clinical utility and value of our technology provided to surgeons. Moving forward with Claire, now FDA PMA-approved, We believe our next-gen AI-enabled platform can broaden adoption, strengthen our commercial opportunity, and support rapid growth. We're in very exciting times here at Perimeter, and we thank you for your support and for your time.

Thank you. And ladies and gentlemen, this concludes today's conference call. Thank you all for joining UME Now Disconnect.