Gross Margin Outlook
Q: What's your outlook on gross margins reaching 75%?
A: Gross margins in Q1 benefited from a favorable geographic mix, with 68% of revenue coming from the U.S., and higher manufacturing capacity utilization helping as well. As we move into the second half of the fiscal year, we expect higher volumes to drive gross margins up to 75%.

OpEx Guidance Reduction
Q: Why did you lower your OpEx guidance for the year?
A: The reduction is due to a change in accounting methodology for stock-based compensation (SBC) expenses related to an executive transition, a non-cash expense. Non-SBC OpEx guidance remains the same, with around 12% year-on-year growth, investing in commercial activities, clinical trials, and R&D initiatives.

Strategy Under New CEO
Q: Will there be significant changes to the strategy?
A: The current strategy is effective, and we plan to continue with it, making small refinements and adding specificity over time. We focus on bringing on accounts that can be significant Zephyr Valve users, driving efficiency, and facilitating best practices among existing accounts.

M&A Outlook
Q: Are you considering M&A to add new products?
A: While we're open to M&A opportunities and are keeping our eyes on technologies that could fit, our focus is on executing the existing strategy to capture the significant untapped market with motivated patients and physician buy-in.

Innovation Pipeline
Q: What can you tell us about the innovation pipeline?
A: We're primarily focused on the AeriSeal clinical trial, which we believe will significantly expand our total addressable market over time. Additionally, we're working on sustaining improvements to make our products easier to use, which is crucial for driving adoption.

12-Month Priorities
Q: What does success look like in the next 12 months?
A: Success means continued progress in our new sales process, clinical initiatives like the CONVERT II trial and the Japanese post-approval study, and increased marketing efforts to raise COPD physician and patient awareness. Effective execution of our existing plan would be a significant win. We also aim to meet or beat our guidance and drive operating leverage through our business.

Account Productivity
Q: How is account productivity progressing?
A: We've seen about a 10% improvement in productivity across our account base. While this metric can be influenced by various factors, we believe that U.S. revenue growth is a better indicator of our progress moving forward.

Tailored Account Strategies
Q: Where is the low-hanging fruit to accelerate growth?
A: Each account has different needs, so we're focusing on refining our strategy to provide more specificity depending on where each account is in the sales process. By tailoring our approach, we aim to accelerate adoption and productivity.

Q1 Performance and Guidance
Q: Should we expect results at the higher end of guidance?
A: We're pleased with our Q1 performance, which strengthens our confidence in the annual revenue guidance. However, it's still early in the fiscal year, and we prefer not to get ahead of ourselves as we aim to see continued momentum and commercial traction.