Perimeter Medical Imaging AI, Inc.

Ladies and gentlemen, and welcome to Perimeter Medical Q2 2026 conference call. At this time, all lines are in the 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 the star zero for the operator. This call is being recorded on Tuesday, August 18, 2026. I would now like to turn the conference over to Stephen Kilmer. With best 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, and Sarah Brien. Thank you for joining us today. and our public filings and press releases, which are posted on CEDARplus.ca. Our results may differ materially from those projected on today's call. No forward-looking statement can be guaranteed. Permanente takes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future, or otherwise, other than as required by law. On the call representing the company are Adrian Mendes, Perimeter's chief executive officer, Sara Brien, the company's chief financial officer, and Andrew Berkeley, Perimeter's chief innovation officer and co-founder. With that said, I'll now turn the call over to Sara.

Thanks, Steve. Good afternoon, everyone, and welcome to our second quarter of 2026 conference call. On behalf of the management team and everyone at Perimeter, I would like to thank you for your ongoing interest in our company. For those of you who are our shareholders, we appreciate your continued interest and support. Before turning the call over to Adrian to provide a commercial update, I'd like to provide a brief update on our preliminary financial results. To streamline things, all of the numbers I will refer to have been rounded, so they are approximate. Also, as a reminder, we report in U.S. dollars. Finally, as you may have noticed, these numbers are preliminary and subject to change. The reason driving this is the accounting treatment and classification of the convertible debentures that was closed in Q2 unit-based structure. While that may impact some of the expense and net loss per share figures, the accounting finalization will not change revenues or cash position. For the three-month period ending June 30th, 2026, the company recorded revenue of $503,100,000. with a full amount coming from recurring revenue, which consisted of the sale of S-Series consumables and system leases, as well as from preventative maintenance services, the sale of ESP warranty programs. This represented 31% sequential growth over Q1, 2026. Operating expenses for the three months ended June 30th, 2026 were $3.1 million. down 28% from $4.3 million in the same period in 2025. Second quarter 2026 net loss was $2.6 million or two cents per common share, a 33% improvement compared to $3.9 million or four cents per common share loss in the three months ended June 30th, 2025. Cash used in operating activities in the six months ended June 30th, 2026 was $5.1 million, a 23% year-over-year decrease from Q2 2025. As of June 30th, 2026, cash was $6.4 million. With that, I'll turn the call over to Adrian.

Thanks, Sara. And thanks again, everyone, for your time and attention today. As we've talked about in the past, our goal in the quarters leading up to FDA approval of our next-generation AI-enabled Clare device was to seed the market with our legacy S-series OCT in order to create a strong network of early adopters and technology champions. Though our commercial team has been and remains relatively lean, it achieved that goal. and the positive momentum we've built through 2025 and into 2026 translated into strong sequential growth of recurring revenues in the second quarter of 2026. Today, despite it only being about four months since the FDA PMA approval of our next generation clear device, we've already made two clear placements and the first hospital has commercially deployed the technology. They may not seem like huge numbers at first blush, but it's important to note that we couldn't even talk to any potential Clare customers before we received FDA approval for the technology in March. On top of that, we have built a strong sales funnel, which consists of a mix of current legacy S-series users looking to upgrade to Clare at a higher ASP per procedure due to the AI, and brand new users who are looking to use OCT in the operating room for the first time. On the back of all that strong interest, we continue to have confidence that we will continue to see commercial traction with Clare to grow as we progress through the rest of 2026 and for it to materially accelerate in 2027 and beyond. And so to summarize what you've just heard, we saw yet another period of positive commercial traction driven by our legacy S-Series product as demonstrated by our 31% sequential quarter-over-quarter recurring revenue growth in the second 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 quarterly operating expenses by 28% and net losses by 33% respectively, and operating cash burn in the first six months decreased by 23%. We received PMA approval from the FDA for our next generation AI-enabled clear device in March. Soon thereafter, we achieved the first two commercial placements, and last week we announced the technology's first commercial deployment by a hospital. We plan on methodically and opportunistically expanding our commercial team to drive growth without getting too far out ahead of it. And finally, pulling all of this together, we believe that we're at a pivotal inflection point in our business and the cusp of entering into a stage of anticipated rapid growth. In a brand new market like ours, it is difficult to predict the timing of growth precisely. But we believe that 2027 revenues will be materially higher than 2026. It's an exciting time for us, and we look forward to keeping updating our progress. And with that, I'd like to now open up the call for your questions. Operator?

Thank you. Ladies and gentlemen, we will now begin the question and answer session. To ask a question, you may press the star followed by the number one on your telephone keypad. And if you're using a speakerphone, please pick up your handset before pressing the keys. to provide your question, please press the star followed by the number two. With that, our first question comes from the line of Michael Freeman with Raymond James. Please go ahead.

Okay, good evening. Congratulations on the quarter. Congratulations on the new deployments. Glad to see this leg of your revenue growth story start. I would like to ask, I'd like to ask about the pipeline. Last quarter, you gave a bit of granularity on how many, I guess, leads or mature leads you have in your pipeline. What detail could you give us about that?

Yeah, I think in general, the pipeline continues to grow, Michael. We're able to now, you know, last quarter we had just started, but at this point, we've been able to continue to move things through that pipeline. Tools that will come through the other end at this point. And I think over the next few months, you'll start to see more of those. We will start to see more of those come through as we continue to put more into the front end of the pipe. What's key for us right now is not just moving what's in that pipe with our small team, as mentioned, but really, you know, building that pipe out larger, you know, putting more to the front end. and that's where a lot of our focus has been right now, both building out the sales team as well as increasing the movement through the pipe.

Got it, got it. Would you be willing to put some numbers to that? I think in the last quarter you talked about 50 qualified leads or is this a number that is in flux?

It's in flux all the time. I think it's just safe to say that the leads that we have continue to increase and continue to move. But it changes consistently, obviously.

I wanted to talk about OpEx. There's a nice reduction in OpEx year over year. I recognize that with the launch of the product, we're going to want to invest in the sales team. Maybe Sara, how should we think about OpEx as the year proceeds?

Yeah, I think OpEx really, from my perspective, is we're going to see sort of and a number of others.

on how you are deploying the sales team currently. What do you view as, if you could just give us an overview of the initial sales strategy in the first few months following Claire's approval.

Yeah, I can give you some more follow on that. So, you know, as you know, we've got a number, several dozen of customers on the older S-series products. and then the pipeline, as we talked about, of new customers. So there's two elements to our path forward. One is converting existing customers over to Clare, and the other is bringing on board some of the new customers from the pipeline. We're focused in the areas we have existing customers, even for the new ones. So, you know, Dallas, of course, is a big center for us, Utah, Colorado, Phoenix. There's a few other areas that we've got customers. So really focus, so part of the strategy is to focus on those geographies, those metropolitan areas, number one. Number two, working through various accounts, whether they're already on the S-Series or brand new, true. As it turns out, even if it's at an existing customer, because Claire has AI on it, it now needs to go through, whereas we didn't have to do this with S-Series, with Claire, we do have to go through all the AI review committees and IT reviews within the hospital. So it isn't a quick flip. It does take them time to run through the review of our AI. So that adds time there. And then, of course, if it's at an account that we don't have any customers, any devices at, then it's a full sales cycle to include contracting and pricing and everything. So, you know, the sales strategy is folks in the hubs, the places we have customers, have multiple tracks, both in converting existing customers as well, again, new customers on board, and then the converting of existing customers. The major work that needs to be done there is go through the IT AI review boards that they have at the hospitals, as well as move to the higher price for the AI. Okay.

Thank you very much.

I'm going to pass the line. Thanks, Michael.

and your next question comes from the line of Kent Belliver with Brookline Capital Markets.

Please go ahead. Thank you. A couple questions. Adrian, acknowledging your earlier comment about the precision around uptake, are you still comfortable with two to three times revenue growth in 2026?

We'll see how the revenue ends up. You know, there's a lot of options that are sort of towards the later stage of the sort of the sales pipeline funnel or whatever. And it'll be a matter of whether they cross over this year or they flip over, you know, cross over the boundary into next year. Still very bullish on our growth trajectory and our ability to get customers onto the clear. So I think we're still in line on that front. and we'll kind of see how things time out. I think what we're working through now from a timing standpoint is actually getting through those AI committees at the hospitals which are turning out to be, you know, there's a lot of education that has to go into that which is something we haven't had to do in the past but our AI from a risk standpoint from the hospital is, it really isn't that risky. We're not connected to the internet. It's not a continuous learning system. It's a fixed AI algorithms. So it doesn't hit any of the real concerns that these committees have. But we still have to go through those. So how that translates into actually getting Claire's, you know, earning revenue, we'll see. We've got a couple, like I said, you know, already across the threshold and we'll see how the rest of them fall out over the next, you know, four months this year and then over the next six to 12 months, you know, into next year.

And in the AI reviews, and again, I acknowledge it Only a couple of places, and it's all new, but how sophisticated are these review boards on the technology, given everything that's coming at them and this pace of change?

What's interesting is that their processes, from what we've observed, the processes within various hospitals are evolving in real time also. So what was the process three months ago has now changed, and now there's a new process with different people and different milestones and things like that. They're getting better. Fundamentally, what they're most concerned about, I think, is really twofold. One is, is your device going out of the system to do its inferences? or is it locally contained within the hospital, right? And for us, that's easy. It's all locally contained inside the device itself. So there's nothing going out to the cloud or to the internet. So they're concerned about that, right? They want to make sure that is the case. And then the other thing they are concerned about is the model that is validated and then gets moved into the hospital, is it fixed or does it continuously change in real times? and ours is fixed and doesn't change in real time, right? So then that's, like, reduces risk from their standpoint. And I guess the third thing, which does take a bit more sophistication, but I think people generally understand this, is is the model a generative model or not, right? And generative being more risky because, you know, it's generating content as opposed to not. Like, ours is not generative. It is really an image detection model. an image recognition type of model. So that also falls in the lower risk bucket. But the ability to communicate that to the right people and go through the process in the right way is what the navigation that we need to do with all our customers now is, which is something we haven't had to do in the past. And frankly, the hospitals haven't really had to do with much until obviously the past couple of years. So their process are evolving as well.

All right. Okay. And one last question is, You had planned to file with CMS for HCPCS codes in June. Were you able to do that as expected?

Yeah. Yeah, we were able to get that filing in place. So that's being reviewed by CMS at this time.

Great. Thank you. Thanks, Ted.

And once again, if you would like to ask a question, please press the star 1 on your telephone keypad. Your next question comes from the line of Scott McCauley with Paradigm Capital. Please go ahead.

Hi, Adrian and Sara. Thanks for taking the questions. I guess just to confirm, how many sites are in total are currently using either the S series or CLAIRE? I think it was 22 or 23. and expect that's probably the same, given that the two were clear systems were kind of conversions, but just wanted to confirm that.

Yeah, that assumption is correct. Yeah, the two that we, the two clear systems were conversions from the S series over to clear.

So, is it 22 total? Oh, sorry, it's 22. Yeah. Cool. And then maybe I was a bit confused with the remarks. So, There was the two that were installed, and that was the announcement with the Q1 update, which was great. And then last week, the commercial adoption, I think you phrased it as one commercial site, but from what I recall in the press release, it was mentioned two hospitals. So are both systems now commercially doing procedures, or is it they're both installed and only one's doing procedures? Just to clarify that for me there.

No, no, they're both installed and they're both doing procedures.

Got it. That's great. And how many did you have a sense of, you know, are you kind of happy with the initial pace of the number of procedures that those sites are doing?

Yeah, I mean, they've flipped over from all the procedures that used to be on the S-series are now on Clare. So I'm happy with that. and now it's a matter of getting more and more CLAIRs out there.

Yeah, absolutely. And do you see the number or the percentage of the procedures that they're using CLAIR or they plan to use CLAIR kind of higher than what maybe they were using the S-series for? If there were some procedures they weren't using S-series that now that they have CLAIR that they're planning to start using it more?

No, I don't think there'll be a difference from that respect. There are folks that with the S-Series were using it for certain types of breast cancer and then other types of things as well. With Clare, the trial we ran through was really focused on those types of breast cancer, right, so DCIS and IDC fundamentally, right, which is pretty much what the S-Series customers are using for also. Okay. So although it can be, you know, the surgeons can use it off-label for other things, the AI was really trained and validated against DCS and IEC. So I don't really see the release of CLAIRE being a catalyst to expansion to different types of use cases other than those. That being said, you know, we're very surprised how often that we talk to surgeons like, oh, we've started to use it in this way or that way. You know, that wasn't really part of our original intention, but... but they find uses for the technology that we hadn't anticipated.

Absolutely. And on the personnel side, I know that hiring and expanding the sales force and the team was a big part of the capital raise and helping to accelerate the rollout. Are you still happy with the people you're seeing? Have you hired anybody in kind of new regions that you're looking to expand in. Kind of any updates in that process would be great.

Yeah, we're happy with the candidates that we're seeing. And so I think we will start to see them coming on board over the next few months. And then, of course, there's a training time and things like that. So where I expect a new sales team to start really delivering from a revenue standpoint, which is ultimately the goal here, is towards the end of the year and then early into next year. So we'll see that acceleration in revenue due to the increase in our sales team. That's great.

And I guess with the current balance sheet and kind of where do you see the runway kind of giving you to hit some of those kind of acceleration?

Sara, you want to take that?

Yeah, I mean, I think, you know, our intention of the the last capital raise was to get 12 months of cash on the balance sheet and we're still projecting that same runway at the time of capital raise.

That's great. Maybe just one or two more. Any kind of major, other major events or conferences that are coming up in the next few months, will you be able to get out there and kind of pound the table on Claire and brought in the reach with lots of the concentrated audience?

From a – on the clinical side, the big conference for us is ASBRS, the annual conference, which happens in the April-May timeframe so that, you know, the innovation timed out pretty well. It came just a month or so after we got FDA approval. So we made a big splash there. But in the breast cancer world, breast surgery world, that's kind of the big one. and then from an investor conference standpoint, there's a few more that we're looking at from now to the end of the year in the fall and we'll make announcements of those as we get closer to the time.

That's great. and maybe lastly, I know I think one of the things you talked about in the past was potential NASDAQ dual listing or kind of leveraging more of the capital markets south of the border. Any kind of progress on that in terms of getting ready for that type of an event?

Yeah, we're in the planning stages on that. So, you know, there's work to do on the accounting side. There's work to do on the legal side. but we've started the process of playing that out and preparing for that.

That's great. I appreciate taking the questions. Thanks. Thanks, Seth.

Thank you. And you do have a follow-up question coming from the line of Kent Belliver with Brookline Capital Markets. Please go ahead.

Great. Thanks again. Do you have any kind of sense of the appetite for customers to do a lease versus a capital sale?

We have, there certainly is a place in our customer base for capital sales leases or leases. We haven't got to the point where that has been the sort of are sticking criteria, frankly, for capital sales versus lease. But definitely it's very standard in the industry. So that is, you know, we're prepared to have those discussions as it comes up with customers. You know, that's fully one of the options we've got in front of us in terms of how we can help get the devices deployed.

Okay, great. And for purposes of any guidance you've given in the past, did you have an implied estimate of

We have not given any guidance to that on that front.

Great, thank you.

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

Thank you. Okay, so the second quarter of 26 marked a critical milestone for Perimeter. Very critical, just this commercialization. So this is highlighted by the first placements of our Clare device out in the field. This represents a major validation of our clinical, regulatory, and technology development efforts, and it does position us to advance to the next phase of commercialization strategy, which is really now focused primarily on scaling our adoption. Moving forward, we believe that we are approaching a period of rapid development Thank you presenters and ladies and gentlemen, this concludes today's conference call. Thank you all for joining. You may now disconnect.