Executive Summary

Q4 FY2025 revenue grew 145% year over year to $1.15M but missed S&P Global consensus of $1.39M; GAAP EPS was ($0.09) versus consensus of ($2.44). Management introduced FY2026 revenue guidance of $12–$16M and guided “at least” $1.7M for Q1 FY2026, while clarifying Gen2 (PH II) is not included in the outlook . Revenue consensus and EPS consensus from S&P Global; values marked with * are from S&P Global.*
Commercial ramp continues: >45 U.S. hospitals installed and using LungFit PH; 3 new hospital starts and 3 renewals in Q4. International distribution now covers >25 countries (>2B lives) and “more than a dozen” LungFit PH units shipped OUS in recent weeks; expect OUS contribution to accelerate in 2H FY2026 .
Product/regulatory: PMA supplement for transport-ready LungFit PH II was submitted (smaller, lighter, transport-ready); management expects PH II, once approved, to be a major share and volume driver, but timing remains uncertain and is not embedded in guidance .
Cost/cash: Operating expenses down ~58% over six quarters; FY2025 cash/cash equivalents and marketable securities were $6.9M (excludes $1.0M GETZ payment post-3/31 and $2.0M additional debt draw). Management cites runway “well into calendar 2026” assuming revenue ramp and cost control .

What Went Well and What Went Wrong

What Went Well
- Strong top-line trajectory: Q4 revenue rose to $1.15M (+7% QoQ; +145% YoY), with management signaling “at least” $1.7M next quarter and FY2026 $12–$16M, reflecting U.S. hospital adoption and early OUS momentum .
- Strategic OUS expansion: >25 country distribution coverage (>2B lives); “more than a dozen” units shipped OUS recently; OUS contribution expected to be meaningful from 2H FY2026 .
- PH II catalyst submitted: PMA supplement for LungFit PH II (transport-ready) filed; management: “we are confident that the introduction of LungFit PH II will play a pivotal role in accelerating our market expansion” .
What Went Wrong
- Revenue miss: Q4 revenue of $1.15M missed S&P Global consensus of $1.39M*. FY2025 revenue of $3.71M also came in below $3.92M* . Revenue consensus from S&P Global.*
- Profitability/margins: Gross margin remained negative despite improvement (gross loss of $32k on $1.15M revenue); net loss was ($8.04M) for Q4, reflecting depreciation and one-time upgrade costs and a high fixed-cost base .
- Balance sheet tight: FY2025-end liquidity was $6.9M in cash and securities (pre $1.0M GETZ and $2.0M additional debt after quarter-end), underscoring reliance on execution and financing arrangements to reach management’s targeted runway .

Financial Results

Metric	Q2 FY2025 (Sep 30, 2024)	Q3 FY2025 (Dec 31, 2024)	Q4 FY2025 (Mar 31, 2025)	QoQ (Q4 vs Q3)	YoY (Q4 vs Q4 FY2024)
Revenue ($USD Millions)	$0.798	$1.072	$1.152	+7.5% (calc from , )	+145.3% (vs $0.470 in Q4 FY2024) (calc from )
GAAP Diluted EPS ($)	($0.28)	($0.15)	($0.09)	+$0.06 (improvement) (calc from , )	+$0.28 (improvement vs Q4 FY2024) (calc from )
Gross Profit Margin %	(135.9%) (gross loss $1.084M / $0.798M) (calc from )	(20.1%) (gross loss $0.215M / $1.072M) (calc from )	(2.8%) (gross loss $0.032M / $1.152M) (calc from )	+17.3 pp (calc)	+108.3 pp (calc)
Net Income Margin %	(1,674%) ($13.358M loss / $0.798M) (calc from )	(1,216%) ($13.032M loss / $1.072M) (calc from )	(698%) ($8.035M loss / $1.152M) (calc from )	+518 pp (calc)	+? pp (requires Q4 FY2024 net loss)

Notes: All “calc” fields are computed from cited source data.

Estimates vs Actuals (S&P Global consensus; asterisked values are from S&P Global)

Q4 FY2025: Revenue $1.39M* vs Actual $1.15M (miss); EPS ($2.44)* vs ($0.09) (better than consensus loss) . Revenue/EPS consensus from S&P Global.*
Q3 FY2025: Revenue $0.93M* vs Actual $1.07M (beat); EPS ($3.20)* vs ($0.15) (better than consensus loss) . Consensus from S&P Global.*
Q2 FY2025: Revenue $1.03M* vs Actual $0.80M (miss); EPS ($5.68)* vs ($0.28) (better than consensus loss) . Consensus from S&P Global.*

Segment breakdown: Not disclosed; company reports consolidated results .

KPIs

U.S. installed base: “more than 45 hospitals” using LungFit PH .
Q4 additions: 3 new hospital starts; 3 renewals .
International distribution: >25 countries covered; access to >2B lives; “more than a dozen” units shipped OUS in recent weeks .
Contracting: Annualized contracted revenue was $3.5M on Oct 1, 2024 (context for run-rate) .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue	Q1 FY2026 (quarter ending Jun 30, 2025)	None	“At least $1.7M”	Introduced
Revenue	FY2026	None	$12–$16M	Introduced
Inclusion of LungFit PH II in guidance	FY2026	N/A	Not included in guidance (management clarification)	Clarified
Operating expenses trajectory	Next 1–2 quarters	Cost reductions ongoing	Expect further OpEx reduction into Q1–Q2, then scale with revenue	Updated commentary

Earnings Call Themes & Trends

Topic	Previous Mentions (Q2 FY2025, Q3 FY2025)	Current Period (Q4 FY2025)	Trend
Commercial ramp (U.S.)	Q2: hospital contracts +60% QoQ; annualized contracted revenue $3.5M (as of Oct 1). Q3: 6 new hospital starts; double-digit sequential growth outlook .	>45 hospitals installed/using; 3 new starts and 3 renewals in Q4 .	Accelerating adoption
International expansion	Q2: CE Mark expected; Australia authorization; Middle East distributors signed .	>25 country coverage; >2B lives; “more than a dozen” units shipped OUS; expect 2H FY2026 OUS revenue ramp .	Ramping; revenue impact skewed to 2H
Regulatory (PH II)	Q2: PH transport-ready PMA supplement planned CY1Q25 .	PH II PMA supplement submitted; transport-ready; expected to meaningfully expand market post approval .	Key 2026+ catalyst; timeline TBD
Cost structure	Q2/Q3: cost conservation; reduced OpEx vs prior year .	OpEx down ~58% over 6 quarters; trough likely June or September quarter .	Improving
Cash/financing	Q2: $20.6M private placement; debt retired/restructured; runway to June 2026 .	FY-end cash & securities $6.9M; +$1.0M GETZ and +$2.0M post-Q4; runway well into CY2026 contingent on execution .	Adequate if execution hits targets
Competitive landscape	Cylinder-based peers unchanged contracting terms; new offering by Mallinckrodt noted .	No change in typical 1/3/5-year contract structures observed .	Stable competitive dynamics
Macro/tariffs	Not emphasized previously.	Limited COGS impact (low-single-digit %) from tariffs; OUS varies by tender timelines .	Manageable headwinds

Management Commentary

Strategic message: “Our commercial momentum is building… With LungFit PH now installed and in regular use at more than 45 hospitals nationwide, awareness is accelerating.”
PH II significance: “We are confident that the introduction of LungFit PH II will play a pivotal role in accelerating our market expansion and advancing our position as a global leader in hospital-based NO delivery.”
Guidance scope: “Fiscal 2026 guidance does not include the second-generation system at all.”
OUS ramp: “We have already shipped more than a dozen units… we plan to see a meaningful contribution… starting in the back half of fiscal 2026 and beyond.”
Cost discipline and runway: “Over the past six quarters, we’ve reduced operating expenses from north of $17 million to just above $7 million… We believe our cash, cash equivalents, marketable securities, and existing financing vehicles will be sufficient… well into calendar 2026… provided we continue to hit our internal revenue estimates and control costs.”

Q&A Highlights

PH II and guidance: PH II not included in FY2026 outlook; approval timing uncertain; company will update once FDA interactions progress .
OUS commercialization: Initial shipments to distributors; expect tender-driven hospital placements with material financial impact in 2H FY2026; usage patterns similar to U.S. where cardiac surgery is on-label OUS .
Expense trajectory: Further OpEx reduction expected into Q1–Q2; then scale with revenue to maintain service levels .
Contracting models: Introducing a “razor/razor-blade” capital purchase + consumables option in addition to traditional hourly contracts; early customer interest could aid FY2026 revenue .
Competitive dynamics: No meaningful change in contract terms (still 1/3/5-year) despite new competitor offerings; Mallinckrodt’s new system considered another cylinder-based option .

Estimates Context

Q4 FY2025: Revenue $1.39M* vs $1.15M actual (miss); EPS ($2.44)* vs ($0.09) actual (better than consensus loss) .
Q3 FY2025: Revenue $0.93M* vs $1.07M actual (beat); EPS ($3.20)* vs ($0.15) actual (better than consensus loss) .
Q2 FY2025: Revenue $1.03M* vs $0.80M actual (miss); EPS ($5.68)* vs ($0.28) actual (better than consensus loss) .

Implications for models: Introduced FY2026 revenue guide ($12–$16M) vs FY2026 revenue consensus of $8.58M* suggests upward estimate revisions if execution on U.S. growth and OUS tenders materializes; PH II approval is incremental and not in company guidance . Consensus values from S&P Global.*

Key Takeaways for Investors

Commercial inflection is underway, with consecutive quarterly revenue growth and >45 U.S. hospitals; however, near-term prints can be noisy versus small-coverage consensus, as seen in Q4 revenue miss .
OUS is the next leg: distribution breadth (>25 countries) and early shipments point to 2H FY2026 revenue contribution; monitor tender wins and initial hospital placements by region .
PH II is the structural catalyst: transport-ready PMA supplement submitted; once approved, management expects step-change in addressable market and logistics—yet not included in FY2026 guide; approval/launch timing will drive re-rating .
Costs have reset materially; watch for further OpEx decline in Q1–Q2 and operating leverage as revenue scales .
Liquidity is adequate if execution continues; follow collections, GETZ/APAC milestones, and any financing developments relative to runway claims into CY2026 .
For trading: upside catalysts include OUS tenders, U.S. account wins, any positive FDA interactions on PH II, and consensus revisions toward company guide; downside risks include tender delays, slower hospital conversions, and any PH II review slippage .

Footnote: All values marked with * are consensus values retrieved from S&P Global via the GetEstimates tool.

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