Good day, and welcome to the BrainsWay First Quarter 2025 Earnings Conference Call. All participants will be in listen-only mode. After today’s presentation, there will be an opportunity to ask questions. Please note this event is being recorded. I would now like to turn the conference over to Brian Ritchie of LifeSci Advisors. Please go ahead.

Thank you all, and welcome to BrainsWay’s first quarter 2025 earnings conference call. With us today are BrainsWay’s Chief Executive Officer, Hadar Levy; and Chief Financial Officer, Ido Marom. The format for today’s call will be a discussion of recent trends and business updates from Hadar, followed by a detailed discussion of the financials. Then we will open up the call for your questions. Earlier today, BrainsWay released financial results for the three months ended March 31, 2025. A copy of the press release is available on the company’s Investor Relations website. Before I turn the call over to Hadar, I would like to remind you that this conference call, including both management’s prepared remarks and the question-and-answer session, may contain projections or other forward-looking statements regarding, among other topics, BrainsWay’s anticipated future operating and financial performance, business plans and prospects and expectations for its products and pipeline, which are all subject to risks and uncertainties, including shifting market conditions resulting from geopolitical, supply chain and other factors as well as the use of non-GAAP financial information. Additional information regarding these and other risks are available in the company’s earnings release and in its other filings with the SEC including the Risk Factors section contained in BrainsWay’s Form 20-F. I would now like to turn the call over to Hadar. Please go ahead.

Thank you, Brian. Welcome everyone and thank you for joining us today. We’re excited to share that we have carried the strong momentum from last year into 2025. In the first quarter, we generated $11.5 million in revenue, marking a 27% increase year-over-year. In addition, we shipped a total of 81 Deep TMS systems, representing a 42% increase compared to the first quarter of 2024. We have signed a backlog and remaining performance obligation totaling nearly $60 million, providing clear visibility into future growth. This overall performance reflects the growing demand for our Deep TMS platform and further reinforces our leadership position in the non-invasive neuromodulation space. Our commercial growth, particularly in the U.S., is being driven by extended adoption of Deep TMS in the treatment of obsessive-compulsive disorder, or OCD, anxious depression, and other mental health conditions. Let me take a minute to review the execution of our sales strategy. Over the past year, we have been highly focused on strengthening our customer base and driving near-term growth by engaging large enterprise networks with multi-year agreements. As part of these agreements, we have elevated our customer service to better handle the unique and evolving needs of each of these accounts. As a result, we are taking this engagement deeper and building valuable partnerships that offer both sides real value beyond the traditional one-time sales approach we used previously. We have also continued to scale our pay-per-use and lease-based model, which supports recurring revenue and provides more flexibility for providers. These efforts are creating a more predictable and sustainable foundation for BrainsWay’s future. However, what truly sets BrainsWay apart and confirms our position as an undisputed leader in the TMS market is our technological and clinical differentiation. In fact, a growing number of customers have switched from other TMS technologies to BrainsWay, citing our clinical performance and economic value as primary reasons. Building on this market positioning, the next phase of our growth strategy focuses on three key pillars: one, further elevating market awareness of Deep TMS and its clinical impact; two, advancing our R&D roadmap to unlock new and expanded treatment indications; and three, broadening patient access through global expansion and health system integration. We believe that these activities are critical as we work to further cement our role in shaping the future of mental health treatment. In terms of opportunities to drive greater access to Deep TMS through new and expanded indication, we are well positioned to ramp up activity around OCD in 2025. Our data for this indication are highly encouraging, demonstrating that over 60% of patients respond positively to Deep TMS therapy. This high response rate underscores the efficacy of our system and its potential to help improve the quality of life for approximately 400,000 patients suffering from OCD annually. It’s also worth noting that we have the first TMS therapy approved for OCD, further elevating our position over the rest of the industry. Anxious depression is another indication where our system was the first TMS device cleared by the FDA as an effective treatment. I’m pleased to announce that doctors in the U.S. are continuing to report an increase in Deep TMS treatment for anxious depression. As a reminder, this refers to patients with major depressive disorder who also exhibit comorbid anxiety symptoms. This is a large addressable medical need that affects approximately 10 to 16 million adults in the U.S. each year. We are also making steady progress in bringing increased attention to our clinical data supporting the use of Deep TMS therapy for post-traumatic stress disorder, or PTSD. We have already made steady progress over the last two quarters following the initial approval for reimbursement of Deep TMS therapy in Israel. As we look ahead, we are working to expand the available reimbursement for PTSD in Israel with the goal of potentially including more Israeli medical centers as well as adding private clinic settings. I will conclude this section of my comments by saying that we continue to advance the randomized multicenter U.S. clinical trial evaluating an accelerated treatment protocol for the Deep TMS system for major depressive disorder or MDD treatment as compared to the current standard of care Deep TMS protocol. As a reminder, the traditional Deep TMS protocol involves a four-week acute treatment phase with one session each day of treatment. This is now being compared to an accelerated protocol, which involves a significantly shorter acute phase, taking place over several treatment days. This has the potential to improve convenience and thereby make Deep TMS substantially more appealing to prospective patients. While I have spent a lot of time today discussing our top-line performance and future growth drivers, our team has done a tremendous job balancing our expense management while generating this high level of revenue growth. This has allowed us to consistently report a strong gross margin of 75%. We also increased our operating income and adjusted EBITDA margin and generated positive cash flow from operation. This brings me to the international trade and tariff policies that have dominated the global news cycle for the past few months. We are actively monitoring our potential exposure to the recent changes to these policies, especially as they pertain to the U.S., Israel and European Union. While specific policies and timing of implementation remain fluid, we do not expect there to be a material impact on our gross margin for the current year. As a result, we are reiterating our full year 2025 financial guidance of between $49 million to $51 million in revenue. This would represent a growth of 20% to 24% over 2024. We also anticipate generating operating income of 3% to 4% and adjusted EBITDA of 11% to 12% for full year 2025. With that, I will now turn the call over to Ido for his review of our first quarter 2025 financial results.

Thank you, Hadar. Revenue for the first quarter of 2025 was $11.5 million, a 27% increase compared to the prior year period revenue of $9.1 million. We placed 81 Deep TMS systems in the first quarter. Our installed base was 1,434 systems as of March 31, 2025, compared to 1,158 systems at the same point in the prior year. Gross profit for the first quarter of 2025 was $8.6 million, or a 75% gross margin. This is compared to $6.8 million during the prior year period at the same gross margin. Moving on to operating expenses. For the first quarter of 2025, sales and marketing expenses were $4.2 million compared to $3.8 million for the first quarter of 2024. Research and development expenses were $2.3 million compared to $1.6 million in the first quarter of 2024. General and administrative expenses for the first quarter of 2025 were $1.5 million compared to $1.3 million for the first quarter of 2024. Operating profit for the first quarter was approximately $576,000 compared to approximately $93,000 for the same period in 2024. Adjusted EBITDA was about $1.3 million, representing the seventh consecutive quarter of positive adjusted EBITDA compared to $715,000 for the first quarter of 2024. For the first quarter ended March 31, 2025, we recorded net profit of about $1.1 million compared to $111,000 in the same period of 2024. We reported cash, cash equivalents, and short-term deposits of about $72 million on March 31, 2025. Based on our backlog and U.S. pipeline and continued momentum internationally, we expect revenue in the range of $49 million to $51 million for the full year 2025, which represents 20% to 24% growth over 2024 revenue. In addition, we anticipate reporting operating profit of 3% to 4% of revenue and adjusted EBITDA of 11% to 12% for the full year 2025. This concludes our prepared remarks. I will now ask the operator to please open up the call for questions.

Yes, thank you. We will now begin the question-and-answer session. And today’s first question comes from Steve Lichtman from Oppenheimer & Company.

Thank you. Congratulations Hadar and Ido on the quarter. I guess the first question is another quarter where systems came in well ahead. As you look at the wins that you’re seeing in the field, any sense you can give us in terms of how much is sort of greenfield opportunity that you’re getting, meaning market expansion versus perhaps some competitive conversions?

Yes. Hi Steve, good morning. Thank you for the question. I think the environment today remains very positive and reasonably strong and we have experienced some large commercial wins recently in the marketplace that are increasing our demand for the Deep TMS system. I would say that roughly around 80% of our new sales are coming from greenfield, which means new customers, and 20% relates to conversion from the competition. Obviously, some of the new systems installed are also coming from an expansion of our current customer base.

Got it. Thanks. You also mentioned continued shift toward more sustainable revenue models like lease, but you also mentioned pay per use. Can you talk about that a little bit more and sort of your evolution on that and where you are at this point in pay per use?

Yes, it depends on the specific segment of customers and territory. In Israel, for instance, we are only working with the pay per use model which is a very unique and flexible business model for the provider and also with some other customers in the U.S. In this business model, we are providing the system with no upfront fee and we are charging on fair procedure. We also provide all the ecosystem around it which includes the technician and operator for this specific business model. The other business model is the fixed business model. It’s a binding contract that our customer base is committed to us for the next four years, which if it’s going to be, is most likely going to be the most preferred business model for them.

Got it. Okay, great. And then just lastly on clinical trials, I guess can you give us a sense of when you think the accelerated protocol data might come in? And then also any update on potential new clinical trials in conjunction with psychedelic drugs? I know the ketamine centers is another opportunity certainly for you. Thanks.

Yes. So we are making very good progress on the clinical trial. We have submitted our results around the accelerated protocol to the FDA and the expectation is to receive the FDA clearance towards the end of the year. We are also working on data collection for PTSD and the treatment of adolescents suffering from MDD to expand our labeling in this area. And for both of them, again, the expectation is to submit the data to the FDA and potentially also get the FDA clearance before the end of the year. We are evaluating the protocol of combining Deep TMS treatment together with some psychedelic treatment in some major centers. So, we are defining the protocol and our goal is to launch this clinical trial potentially in Q3 this year.

Great. Thanks, Hadar.

Thank you, Steve.

Thank you. And the next question comes from Jeff Cohen with Ladenburg Thalmann.

Hi, this is Destiny on for Jeff. Thank you for taking our questions. Just quickly, in case I missed it, did you make any comments around OCD helmets that were shipped during the quarter and what that installed base looks like currently?

We did not. But I can share with you that we shipped 57 OCD coils that bring us to close to 850 OCD coils around the globe.

Wow! Okay, got it. Thank you. And then looking ahead more with this Deep TMS 360 product, I’m curious, I know it’s still early, so just really hypothetically, how are you seeing this device fitting into a center? So, is this something that one of these larger accounts would have an existing system, a traditional system like they have now with the multiple different coils, or is it something where as well as a 360 system, or is it more so that a center would upgrade or switch out the device to a 360 in order to have it – in order to have all the offerings? Does that make sense? Does my question make sense?

Absolutely. I think the right answer is that it will be a mix of both. At least at the beginning. The TMS 360 has its advantages. It’s a revolutionary system that is aiming to provide us with a shorter treatment with better efficacy and to potentially treat areas where we hope to see some better effects, like dementia and some areas around addiction that currently we believe, as compared to the TMS 104 system, we’re supposed to see some better treatment. So I believe some of the customers will need to have both systems. Some of them will just ask us to upgrade. It just depends on the segmentation and the profile of the potential customers. There are greenfield customers in the addiction space that we haven’t explored much yet. I believe that the next indication with the TMS 360 is going to be a perfect match for that.

Excellent. Okay, thank you. I am going to take the rest of my questions offline. Thank you for the time.

Thank you, Destiny.

Thank you. And the next question comes from Ram Selvaraju with H.C. Wainwright.

Good morning. I'm curious if you’re seeing any significant geopolitical risk related to potential disruption to the business. Can you quantify this?

Not necessarily. We’re always living in an environment that we see lots of changes, with the MFN, etc. But we don’t see it as having a negative impact. We are always trying to evaluate things that are happening. The same goes for the tariff policies. We are actively monitoring everything around us. For now, we don’t see any negative impact on our industry, but it doesn’t mean that we’re not actively monitoring this on a daily basis. We do believe that Deep TMS technology holds multiple unique advantages over any kind of drug therapies. Even the tariff is not something that we consider material for us today. So the overall environment continues to be very positive for us.

Got it. That’s helpful. Are you likely to see any more meaningful upgrading of the current install base this year or in 2026?

Yes, look, the demand continues to grow and you see it in the numbers quarter-over-quarter. I’m comparing brain cells to the competition. We are truly the market leader selling most of the systems, but most importantly, also the additional coils that are providing additional treatment capabilities to our customer base. We will continue to provide demand to the market. We continue to see constant demand not only for the H1-coil for depression, but also growing demand for the H7-coil and the H4-coil for the addiction space. I believe that healthy demand will continue to drive the adoption of the Deep TMS system by the end of the year and also toward 2026.

Okay, that’s helpful. One final one, if I could just ask if you’re considering implementing a stock repurchase program? What would be the primary considerations that would determine the timing of that moving forward?

Not at the moment. I think for now we are evaluating all the options on the table. There are lots of really great options today. We’ve got close to $72 million in our bank account, and we’re aiming to expand the growth of our top-line revenue while simultaneously continuing to invest in innovation for the future of this technology and product. We will continue to evaluate this option toward the end of the year after assessing all the opportunities on the table.

All right, thank you so much. Those are all my questions.

Thank you, Ram.

Thank you. This concludes our question-and-answer session. I would like to turn the conference back over to Hadar Levy for any closing comments.

Thank you. I would like to thank all of the investors, analysts, and other participants for their interest in BrainsWay. With that, please enjoy the rest of your day. Goodbye.

The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect your lines.