Profound Medical — Third Quarter 2026 Earnings Summary

Financial Performance:

• Total revenue for Q3 2026 reached approximately $9.8 million, an 86% increase year-over-year, comprising $4.1 million in recurring non-capital revenue and $5.7 million from capital equipment sales.
• Gross margin expanded to 78% in Q3 2026 from 74% in the prior-year period.
• Operating expenses increased 21% year-over-year to approximately $15.5 million, driven by headcount, commissions, travel, severance, and R&D spending, partially offset by reduced clinical trial costs.
• Cash used in operating activities was approximately $5.0 million in Q3 2026, a 56% sequential decline from Q2 2026 and a 48% year-over-year decrease from Q3 2025.
• Net loss improved 3% to approximately $7.7 million ($0.21 per share) from $8.0 million ($0.26 per share) in the prior-year quarter.
• Cash and cash equivalents stood at approximately $33.3 million as of September 30, 2026.
• Deferred revenue increased to $805,000 (current) and $743,000 (long-term) at September 30, 2026, compared to $445,000 and $388,000 respectively in December 2025.
• Long-term debt of $4.512 million was recorded at September 30, 2026, compared to $4.499 million in long-term debt at December 31, 2025 (with $4,512 million current portion and $0 long-term portion at Q3 2026).

Guidance and Future Outlook:

• Full-year 2026 revenue is projected to be at least $25.0 million.
• Full-year 2026 gross margin is expected to be 70% or higher.
• Management expects existing cash and revenue to fund operating and capital expenditure requirements for at least the next 12 months.
• The company has no immediate plans to raise capital but will opportunistically evaluate dilutive and non-dilutive financing opportunities.

Business Segments and Product Lines:

• The TULSA-PRO installed base grew to 98 systems at quarter-end.
• The 5,000th TULSA Procedure was performed in October.
• A new supply and distribution agreement with Cook Medical positions TULSA-PRO within the iMRI Suite offering through Cook's Copernicus program, expanding U.S. sales channels.
• Under the Cook agreement, Cook will purchase TULSA-PRO systems for distribution in the U.S., while customers obtain disposables and service contracts directly from Profound.
• The qualified sales pipeline for TULSA-PRO and Sonalleve totaled approximately $79.2 million at the end of Q3 2026.
• New co-education agreement with Telix Pharmaceuticals to broaden reach within the urology community and increase awareness of TULSA-PRO.
• Utilization data shows TULSA-PRO used across various prostate conditions, sizes, and ablation types, including 79% for malignant tissue ablation and 42% for whole-gland ablation.

Market and Competitive Landscape:

• Commercial payer engagement showed progress, with approximately 10.7 million covered lives added in Q3 2026, including 1.8 million from commercial and Medicare Advantage programs.
• The company maintains a co-sales and co-marketing agreement with Siemens Healthineers to commercialize a total MRI-guided prostate therapy solution.
• TULSA-PRO is FDA-cleared for use with multiple compatible 1.5T and 3T MRI systems and is being worked on for 510(k) clearance with the MAGNETOM Free.Max scanner.
• Post-market CAPTAIN Level 1 randomized clinical data demonstrated statistically significant advantages over robotic radical prostatectomy.

Risks and Challenges:

• Forward-looking statements regarding revenue, financial results, and commercialization success are subject to risks including regulatory approvals, reimbursement, economic factors, and competition.
• There is no assurance that the qualified sales pipeline will result in recognized revenue within a specific timeframe.
• Actual results may vary from projections due to numerous risks and uncertainties affecting the medical device industry.

Management Commentary and Tone:

• CEO Arun Menawat expressed confidence in the business's progress, citing the 86% revenue growth and declining cash burn as evidence of a strong full-year outlook.
• Menawat emphasized the priority of converting physician interest and payer coverage into system placements and recurring revenue.
• Incoming CEO Richard Fabian, effective January 14, 2027, stated his priority is to scale the organization across commercial, clinical, operational, and supply chain aspects.
• Menawat will transition to Executive Chairman to support continuity as Profound advances its commercial strategy.
• CFO Matthew Sobczyk was appointed permanent CFO, bringing financial expertise to support spending discipline and capital allocation.
• Jason Mills joined the Board, bringing experience in strategy, capital markets, and medical technology investment analysis.

Other Key Points:

• Richard Fabian, currently President, will succeed Arun Menawat as CEO on January 14, 2027.
• Matthew Sobczyk was named permanent CFO, effective immediately.
• Jason Mills was appointed to the Board of Directors, succeeding Cynthia Lavoie.
• Profound has 36,626,844 common shares outstanding as of November 5, 2026.
• The company is presenting clinical data at the 15th Interventional MRI Symposium and plans to present one-year CAPTAIN data at RSNA 2026.
• The company recorded a monthly high for new order activity in July.