Good day, and thank you for standing by. Welcome to the Profound Medical Fourth Quarter 2025 Financial Results Conference Call. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Stephen Kilmer, Investor Relations. Sir, please go ahead.

Thank you, and 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 in the United States and Canada. All forward-looking statements are based on Profound's current beliefs, assumptions, and expectations and relate to, among other things, any expressed or implied statements or guidance regarding current or future financial performance and position, and expectations regarding the efficacy of Profound technology. Such statements involve known and unknown risks, uncertainties, and other factors that may cause actual results, performance, or achievements to be materially different from those implied by such statements. No forward-looking statement can be guaranteed. Listeners are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this conference call. Profound undertakes no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events, or otherwise, other than as required by law. Representing the company today are Dr. Arun Menawat, Profound's Chief Executive Officer; Rashed Dewan, the company's Chief Financial Officer; Dr. Mathieu Burtnyk, Profound's President; and Tom Tamberrino, our Chief Commercial Officer. Please note that our prepared remarks today will be a little longer than normal as we present to you the dynamics of the market and our strategies to create a profitable growth company. With that said, I'll now turn the call over to Rashed.

Good afternoon, everyone, and welcome to our Fourth Quarter and Full Year 2025 Conference Call. On behalf of the management team and everyone at Profound, I would like to thank you for your ongoing interest in our company. For those of you who are shareholders, we appreciate your continued interest and support. I will turn the call over to Mathieu shortly for commercial updates. However, first, I want to provide a brief summary of our fourth quarter 2025 financial results. To streamline things, all numbers I refer to have been rounded and are approximate. For the three months ended December 31, 2025, the company recorded revenue of $6 million, with $2.3 million from recurring revenue and $3.7 million from one-time sales of capital equipment. Fourth quarter 2025 revenue increased by 43% from $4.2 million for the same period a year ago. Gross margin for Q4 2025 was 67% compared to 71% in Q4 2024. The lower gross margin in the fourth quarter of 2025 was mainly due to product mix and introductory pricing in new markets with international distributors in Saudi Arabia and Australia. Total operating expenses for the fourth quarter of 2025, which include R&D and SG&A expenses, were $11.4 million compared to $11.3 million in Q4 2024. Overall, the company reported a net loss of $8.2 million, or $0.27 per common share, compared to a net loss of approximately $4.9 million, or $0.20 per common share, in the three months ended December 31, 2024. As of December 31, 2025, Profound had cash of $59.7 million. As Arun will discuss later in the call, we believe we are now on a path to profitable growth. In line with that, we expect our cash burn to decline and eventually become cash flow positive as our revenues continue to grow and our margins remain high. Now, I will turn the call over to Mathieu for an update on clinical and development activities.

Again, I'm sorry, let me cover Mathieu's part here. So again, Rashed, thank you. Last year, we completed recruitment in CAPTAIN, the first multicenter, randomized, controlled trial directly comparing a new technology to robotic radical prostatectomy for men with localized prostate cancer. CAPTAIN completes the foundational pillars of clinical evidence, validating TULSA as the new platform for prostate disease management. From gold-standard treatment, treat and resect data through track durable 5-year outcomes, CAPTAIN now positions us to demonstrate with statistical rigor, TULSA's superior quality of life profile while delivering whole-gland treatment efficacy. CAPTAIN was designed for world-leading experts in prostate cancer clinical trials. They built a practical study that ensured successful enrollment and, more importantly, a scientifically robust protocol with endpoints that matter to patients, clinicians, and payers. Let me repeat that point. CAPTAIN's endpoints are those that matter to the patients, the clinicians, and the payers. Patients were randomized 2:1 using an intelligent stratification algorithm, resulting in highly balanced arms, a cornerstone of credible randomized trials, balanced arms allow us to make definitive comparative conclusions about safety and efficacy. And critically, CAPTAIN measures efficacy in a meaningful way, determining whether clinically significant cancer remains after treatment. Patients and their oncologists want to know whether cancer has been killed and eliminated, not merely whether it had progressed. As discussed last quarter, completing treatments in CAPTAIN locks in the timeline for data readouts, including the imminent release of primary safety and quality of life endpoints. Last year, we shared initial perioperative outcomes showing faster recoveries after TULSA than robotic prostatectomy with zero blood loss or overnight hospitalization, reduced pain, and earlier return to daily function and overall health. These advantages echo the same drivers that fueled early adoption of robotic surgery.

Thank you for taking over. I can jump back in if you want?

Okay. Go ahead.

I'll go ahead. So ahead of schedule, we will present the first clinical outcomes from CAPTAIN next week at the meeting of the European Association of Urology in London, U.K. EAU is the premier academic urology meeting, and we were pleased that our data has been selected for inclusion in the late-breaking and the high-impact session. The presentation will be delivered by Dr. Laurence Klotz on Friday, March 13, between 1:00 and 3:00 p.m. Greenwich Mean Time, which is 8:00 to 10:00 a.m. Eastern time. These data include complete 90-day perioperative results and the 6-month primary safety and quality of life endpoints. Six-month quality of life outcomes are an increasingly important and modern endpoint. They reflect meaningful patient recovery and provide a more relevant early indicator of functional preservation. At EAU, we will report 6-month urinary incontinence rates, the single most important quality of life outcome for patients, along with 90-day hospital readmissions and time to return to work. At EAU, we will also report positive surgical margin rates in the prostatectomy arm, which we will later compare against TULSA biopsy outcomes in late Q4. CAPTAIN provides the first true apples-to-apples comparison of safety, quality of life, and efficacy, the information required to support a new treatment paradigm. CAPTAIN is the most comprehensive truly Level 1 trial. But let me also take the time to outline the fundamental differences between CAPTAIN and other ongoing studies, namely WATER IV, FARP, and HIFU. First, WATER IV. WATER IV is a multicenter randomized trial comparing Aquablation to radical prostatectomy in men with low and intermediate-risk localized prostate cancer. The inclusion of low-risk patients is a critical distinction because these men harbor minimal disease and are unlikely to progress within the study's follow-up period, limiting any meaningful assessment of cancer control. Equally important is what the trial measures. WATER IV's primary endpoints are quality-of-life only. That means that the study is not designed or powered to demonstrate comparative oncologic efficacy. This is particularly notable considering there are no other peer-reviewed data using the Aquablation procedure to eliminate cancer in prostate cancer patients. The trial includes a single cancer-related secondary endpoint assessed only in the Aquablation arm, which is the stable or improved grade group at 1 year versus baseline. In practice, that means a patient who entered the study with grade group 3, an unfavorable intermediate risk clinically significant cancer will be counted as a success even if the same grade group 3 disease remains after treatment. That is not the same as limiting cancer or even improving the cancer grade, and is not a randomized head-to-head efficacy readout. Frankly, this is not a Level 1 cancer trial. Next, FARP. The focal ablation versus radical prostatectomy study. FARP is a single-center European trial, which inherently limits generalizability to broad clinical practice, particularly to high-volume U.S. surgeons. Its population, like WATER IV, includes low and intermediate risk patients with disease localized to one side of the prostate. While FARP does include a comparative efficacy measure, the bar is not oncologic eradication. The focal therapy arm is deemed effective if patients avoid upgrading to grade group 4. In other words, men who start with grade group 1, 2, or 3 are considered successfully treated as long as they do not progress to grade group 4. This is a very different endpoint than curing and eliminating clinically significant cancer. Even though TULSA was part of the study and to the best of our knowledge, the TULSA arm did better than any other arm, including HIFU, the reason we think is that not the most credible study is the endpoint itself. Avoiding upgrade is not the same as proving cancer has been cleared. Patients want to know plainly whether they still have cancer or not. Lastly, HIFU, a large multisite French comparison of HIFU versus prostatectomy did not randomize patients and therefore, is not considered a Level 1 trial. The result is significant selection bias and unbalanced arms. For example, HIFU patients were on average roughly a decade older than surgery patients. Age differences directly confound the study's primary endpoint of salvage treatment-free survival and erectile function. Older patients are less likely to undergo salvage treatment. Older patients have lower baseline erectile function, which means they have less function to lose after treatment. Without balanced randomization, you cannot make definitive comparative conclusions. Let me conclude. TULSA is solving the debate between focal and whole-gland treatment for prostate cancer. CAPTAIN measures efficacy to the same standard as robotic surgery, an essential requirement to establish a new standard of care. TULSA is the only technology capable of whole-gland, focal, and customized treatment. Patients often choose focal therapy to preserve quality of life. With TULSA, patients achieve the benefit of focal side effects with the efficacy of whole-gland treatment. I will now turn the call over to Tom.

Thank you, Mathieu. As Rashed mentioned, we achieved a year-over-year revenue increase of 43%. We had 78 TULSA-PRO sites as of December 31, 2025. The company's TULSA-PRO qualified sales pipeline is also growing and currently stands at 110 new systems being classified within one of the verify, negotiate and contracting stages, which are the final three phases of our sales process. Q3 2025 was a true commercial inflection point, and we saw the momentum continue in Q4. We're continuing to see broader adoption of TULSA-PRO across both academic and community hospitals. That's largely due to increased awareness of the system's clinical benefits and the establishment of a reimbursement pathway made possible by the Category 1 CPT codes for the TULSA procedure. TULSA reimbursement was confirmed again for 2026 at urology Level 7, which is appropriate as TULSA utilized real-time MR, which is crucial to better clinical outcomes. Our team has also initiated engagement with private insurance carriers, and we expect coverage decisions from carriers in the second half of 2026. Our global commercial leadership team has never been stronger than it is today. This includes sales, marketing, business development, health economics, market access, patient education, patient access, clinical service, and strategic initiatives. We have a world-class team of professionals here in the U.S. and around the world. It is noteworthy that we have launched a strategic TULSA program team, which will use our organizational leverage to ensure successful TULSA program launches and this team will grow procedural volume thereafter. Our team remains focused on targeting high-volume urology centers and supporting physician training. We're leveraging positive clinical outcomes and patient testimonials to drive engagement and deepen relationships with our customers. Looking ahead, I'm confident in our ability to further accelerate this growth. We're well positioned to capitalize on the expanding interest in image-guided interventions and we continue to scale our commercial footprint while validating our technology in the prostate care market. And as Arun will also highlight, there are a number of important catalysts coming in 2026, that continue to drive our belief that we will reach high double-digit to low triple-digit revenue growth. Importantly, we believe we are now on a path to not just growth but profitable growth with this selling approach. The math to achieve this target is simple, with just 200 TULSA program cases using the existing MR installed base, assuming a conservative 50 TULSA procedures per site per year and a $5,500 recurring revenue to Profound per procedure, we would be at $55 million in procedural revenue. Add to this $10 million in annual service revenue, and another $20 million in new capital sale revenue based on an estimate of 40 new TULSA-PRO systems sold per year at an average sales price of $500,000 per system. Altogether, this will put us around $85 million in annual revenue. With 70% plus gross margin already achieved, we would be profitable. We're also building strategic partnerships on a global basis. Recent distribution agreements with Al Faisaliah Medical Systems in Saudi Arabia and Getz Healthcare in Australia and New Zealand have already started to bear fruit with multiple systems sold in Q4 2025. Our partnerships with OEMs such as Siemens are also progressing well, and there's more exciting opportunity to come on the partnership front as 2026 progresses. Thank you for your time. I will now turn the call over to Arun.

Thank you, Tom, and good afternoon, again. Prostate cancer treatment has historically been divided into two main approaches: whole-gland robotic prostatectomy and radiation therapy. Focal therapy options like HIFU, cryoablation, and IRE have emerged to compete with these traditional methods by treating typically less than 35% of the gland, targeting only the visible cancer. However, TULSA is establishing itself as a unique category. TULSA-PRO can be used to treat the entire gland, a small portion, or anything in between. It combines the effective clinical outcomes of whole-gland treatments with the reduced side effects associated with focal therapies. The distinct nature of the TULSA procedure is crucial, though it may be challenging for urologists and hospitals to grasp the differences amid competing focal therapies from various companies. While it may be difficult, it's certainly achievable. Most surgeons who have utilized both TULSA-PRO and other treatments have preferred TULSA due to its versatility in addressing a full range of prostate diseases while minimizing quality-of-life issues like urinary incontinence and erectile dysfunction. We believe that whole-gland robotic prostatectomy and radiation therapy have reached their limits, and alternative focal therapies are insufficient. The TULSA-PRO system stands out with its ability to address all types of prostate disease while providing better economics to providers and more value to payers. TULSA leverages real-time MR imaging, which offers several significant clinical and economic benefits. First, real-time MR thermometry allows for continuous visualization and autonomous temperature adjustments throughout the procedure, enabling tailored therapies that minimize side effects typically linked to robotic surgery or radiation. Second, MR generates standardized cross-sectional images that facilitate AI analysis, something that may not be achievable with other imaging techniques like ultrasound. This capability allows TULSA-PRO to employ an AI-driven treatment plan. With a single click, the AI software delineates the prostate and presents a treatment design while keeping critical nerve bundles and the sphincter muscle region safe. Surgeons can either approve the AI-generated plan or adjust it as needed, streamlining and ensuring reliability in treatment planning. The TULSA-AI contouring assistant is based on treatment plans from leading radiologists and has demonstrated superiority over surgeon-generated designs. Third, MR enables real-time temperature monitoring. With this feature and directional ultrasound from a catheter placed in the urethra, TULSA-PRO can gently heat tissue to target temperatures between 55 to 57 degrees Celsius without causing boiling or charring. This means the entire gland, or any portion designated by the surgeon, can be effectively treated while the body reabsorbs the dead tissue. In the FDA-registered TACT clinical trial, measurements showed a median prostate size reduction of 91%, achieved by effectively shrinking the prostate around the urinary channel, which is safeguarded during the procedure. Fourth, TULSA-AI allows for cleaner surgical margins. During the TULSA procedure, real-time MR gives surgeons visibility into the cancer present in the prostate. If needed, they can engage an additional TULSA-AI module, Thermal Boost, to apply extra heat to ensure effective temperatures at the prostate's outer margin or slightly beyond. Fifth, it’s worth noting that even TULSA's partial gland or focal procedures outperform other focal methods that rely solely on ultrasound imaging. TULSA benefits from real-time MR diffusion and T2 images, which pinpoint abnormal cell regions that could indicate cancer. This real-time imaging helps surgeons accurately define treatment areas to encompass suspicious zones, enhancing the chances of successful focal or partial gland treatment while reducing side effects. Lastly, advanced real-time MR imaging confirms treatment success by monitoring cell death at the procedure's conclusion, improving the predictability of outcomes based on the intent of treatment. In summary, TULSA-PRO addresses the debate between whole-gland and focal prostate cancer treatments without compromising effectiveness. TULSA-PRO can treat the entire gland, small portions, or anything in between, applicable to large, small, or even radio-recurrent prostates, all enhanced by the guidance from MR imaging. It's successfully used for low, medium, and high-risk cancers, as well as salvage cases. Switching to benign prostatic hyperplasia (BPH), traditional treatments like transurethral resection of the prostate (TURP) have remained largely unchanged over the last century. Several alternative treatments aim to enhance patient experiences and minimize complications such as bleeding, erectile dysfunction, loss of ejaculation, and extended hospital stays. A recently published study from the University of Turku shows TULSA significantly improves International Prostate Symptom Scores, peak urine volume rates, and the discontinuation of BPH medications. Despite urologists using TULSA-PRO since we received FDA clearance in 2019, our BPH patient volumes have been limited due to longer treatment durations compared to other options. The latest TULSA-AI volume reduction feature is shifting the BPH treatment landscape. This module is designed to preserve the many benefits of TULSA while streamlining the process for urologists by quickly identifying the overgrown areas indicating BPH. The software simplifies workflows and cuts procedure times down to between 60 and 90 minutes. With the growing economic rationale for TULSA-PRO, the reimbursement landscape has strengthened as of January 2026. CMS has separated reimbursement for real-time MR in-bore biopsy from the current method that relies on real-time ultrasound registered with prior MR images. This adjustment allows surgeons to view cancerous areas through registered MR images while utilizing ultrasound convenience for biopsies. Though this method is an improvement over non-MR applications, data indicate a 20% error rate from image registration. Consequently, CMS now offers separate reimbursement for more accurate, albeit costlier, real-time in-bore MR biopsy. The reimbursement for standard MR registered ultrasound biopsies is approximately $3,500, whereas real-time MR biopsies are set at around $5,500, representing a 57% increase. This is a notable change that is beginning to garner interest. Comparing Medicare national average payments, the hospital reimbursement for the TULSA procedure in 2026 stands at $13,479, compared to $10,860 for robotic surgery and $9,672 for focal therapies like HIFU and cryoablation. Therefore, starting in 2026, both in-bore MR prostate biopsy and the TULSA Procedure enjoy superior reimbursement rates. Overall, our hypothesis that the future of prostate disease care will be MR-centric is being validated. Clinical evidence suggests that if prostate cancer is detectable on an MR, immediate treatment is warranted, solidifying iMRI and in-bore biopsy as the preferred diagnostic methods. Typically, 3 to 5 biopsy procedures are performed for each prostate cancer treatment, and with approximately 1 million prostate biopsies conducted annually, no single treatment method currently exceeds 100,000 patients per year. This indicates a clear disparity between preferred MR-guided diagnostic methods and mainstream treatment options. We believe TULSA is uniquely positioned to bridge that gap moving forward. Our near-term strategy focuses on expanding our network to reach 200 TULSA-PRO sites. Simultaneously, we are finalizing compatibility for the new Siemens Interventional MR, Free.Max. We anticipate that by late 2026, TULSA-equipped sites using Free.Max will be operational, paving the way for a future interventional MR suite featuring TULSA. These locations will enhance patient workflows and staffing efficiencies, further promoting adoption. We've received consistent confirmation that hospitals are receiving payments for all qualified Medicare patients and expressing satisfaction with the reimbursement levels. Additionally, many commercial payers are now approving coverage for the procedure on a case-by-case basis. We're excited about the recent upgrade to our AI-powered software, which simplifies the patient workflow for those experiencing BPH symptoms. This versatility allows us to address a diverse range of prostate cancer and BPH patients effectively, enabling facilities to optimize scheduling for TULSA Procedure days, enhancing operational efficiency for hospital staff. This development significantly broadens our total addressable market. The economic viability surrounding real-time iMRI procedures for prostate cancer, including MR in-bore biopsy and TULSA, continues to strengthen. Before concluding, I’d like to discuss our second major opportunity, Sonalleve. This technology, primarily sold as a one-time capital investment, employs the same MR imaging and thermal technology found in TULSA-PRO, utilizing focused ultrasound to treat diseases from outside the body. Currently, ten Sonalleve devices are operational in parts of Europe, China, and Southeast Asia, having treated over 4,000 women for uterine adenomyosis and fibroids, conditions that can lead to chronic pain and heavy menstrual bleeding. Sonalleve has shown promise in providing pain relief and addressing symptoms without affecting ovarian reserve, allowing women to maintain their fertility. Furthermore, Sonalleve is undergoing research and clinical trials in Europe for the ablation of pancreatic cancer and other oncological diseases. We are developing an FDA regulatory strategy for this technology, alongside potential recurring revenue opportunities beyond the initial device sale, with further updates to come later this year. In summary, Profound is at the forefront of iMRI procedures, offering precise, incision-free therapies that enhance clinical confidence, procedural control, and patient outcomes. By utilizing real-time MR guidance, our technologies aim to eliminate uncertainty in treatment planning, execution, and verification. We stand as the only company capable of delivering treatments from inside the body through a catheter inserted via a natural orifice, which is represented by our TULSA technology, and from the outside using a disc, as seen with the Sonalleve technology. Regardless of configuration, MR enables real-time imaging and temperature measurement to achieve cell kill with minimal energy. Our sales team is effectively driving results, and our defined pipeline is now over 110 compared to 97 at the end of 2025. The TULSA-PRO installed base was 78 at year-end, and we expect this to grow to about 120 by the end of 2026. The new AI volume reduction module for addressing BPH symptoms is significantly shortening procedure times, making TULSA competitive with other BPH treatment options. This application could potentially add 400,000 patients to our annual total addressable market, effectively tripling it. The inclusion of the BPH module allows physicians to facilitate a full TULSA day, treating both prostate cancer and BPH patients together, which is crucial for scheduling and maintaining an active TULSA program. Our second technology platform, Sonalleve, is set to play a more integral role in our narrative in the upcoming months and quarters, both internationally and in the U.S. Finally, we believe the various catalysts ahead position us for substantial revenue growth in the high double-digit to low triple-digit range. This concludes our prepared remarks. We're now happy to take any questions you may have.

Our first question will come from Ben Haynor with Lake Street Capital Markets.

First one for me on the private payers, I appreciate the commentary on giving commercial insurers to pay for it, you think in the second half of the year. I was wondering if you can give us any sense of what your customers are seeing now. I know I think on the Q3 call, you mentioned that commercial insurers were reimbursing roughly $25,000 to $65,000 is the range you had seen. And then any commentary on whether you're being successful in getting any commercial rejections overturned ultimately?

Ben, yes. So the number of patients who are going through the private is increasing. The typical payments are between, I would say, most of them are between 1.5x to 2.5x of Medicare. So we're pretty satisfied, and our sites are happy with the numbers. With respect to coverage and reversals from rejections, we are tracking better than 90% at this point. Just recently, I saw one very strategic reversal. There are certain independent organizations in the U.S. like Maximus and so on. These companies actually make independent determinations that hospitals use as guides or whether or not a new technology is considered experimental or standard of care, and they recently deemed our TULSA as standard of care. So we're pretty optimistic actually. We're very, very satisfied with the numbers that we're seeing, and we are very optimistic we'll start to see actually converting these reductions into coverage decisions in the second half of the year.

That's very helpful. Great. And then I apologize if I missed this, but can you maybe comment here on the dynamics of the sequential decline you saw in noncapital revenue here?

We lost you a little bit. Could you repeat the question?

I was wondering if you could comment on the dynamics you observed regarding utilization. It seems there was a sequential decline in noncapital revenue from Q3 to Q4.

We lost you a little bit. Could you repeat the question?

Could you comment on the dynamics of utilization from Q3 to Q4 and whether the movement in noncapital revenue sequentially?

Yes, I understand. The trend we've observed shows that every site is gradually increasing usage. Last quarter, we noted a specific figure indicating a quarter-over-quarter increase of about 20 percent. This trend seems to be continuing in terms of procedures. As Tom mentioned in his presentation, we anticipate that with the new catalysts, such as the CAPTAIN data releasing next Friday and the BPH module now reaching our customers, the pace of usage is expected to accelerate in 2026. Regarding your question about capital dynamics, we're still in the early stages, and predicting capital is definitely more challenging than forecasting recurring revenue. We did share a couple of initial market prices with some sites in Q4, and currently, you will notice that our product mix is becoming a bit more capital-focused due to device sales. As Tom highlighted, our pipeline remains robust. Nonetheless, in the long run, we expect over 70 percent of our revenue will originate from recurring sources. In the next few years, as we grow our installed base, you can expect the capital revenue to range between 40 percent to 60 percent per quarter.

Okay. Got it. And then just talking about the installs for this year and looking at for 40-or-so more units, and that's roughly 1/3 of the pipeline that you have. Are there any bottlenecks on year-end that need to be taken care of in terms of the capacity to install new units? Is there anything that you can improve on your side of things?

Ben, we are a growing company. So most certainly, Q4 was a very dynamic quarter. And because we shipped for the first time systems in double digits. And yes, we are increasing our logistics and operations side. We're actually looking to put a warehouse in the U.S. that would allow us to streamline some of the shipments. We are also putting all the ERP systems to make sure all the scheduling and building of the devices are taking place. Nothing that is anything out of the ordinary that we would not do at this time in our company. But yes, there is a lot of dynamics along the lines of making sure that, as Tom and his team starts to build the top line that we are able to deliver appropriately.

Our next question comes from the line of John McAulay with Stifel.

I want to put a finer point on the recurring revenue question that's been asked. So just as I do the back of the envelope math here, if procedures grew roughly 20% quarter-over-quarter, as you said, total recurring revenue, $2.3 million, it implies that revenue per procedure declined significantly, something like more than 50% quarter-over-quarter. So I just want to understand how much of this is driven by the more capital-focused mix? Was there some kind of one-time conversion or discounting in here? And what should we expect going forward on a revenue per procedure basis?

Yes. The 20% growth I mentioned was year-over-year, not quarter-over-quarter. When we assess inventory, we manage it accordingly. Therefore, the quarter-over-quarter recurring revenue may not directly reflect the product usage. Typically, purchases occur in the third quarter for use in the fourth quarter, leading to fluctuations. I wouldn't make a direct correlation on a quarterly basis, but over a six-month period, it becomes more relevant. There has been no discounting at all. Our set price for disposables is fixed at $5,500. Very few sites do not own the equipment, and in those cases, we actually see prices exceeding $5,500. Thus, there is no discounting on the disposable price.

Understood. That's helpful. And switching gears to 2026, you talked about high double-digit, low triple-digit growth. Consensus is currently, I think it's something like 120%. Our numbers are closer to 100%. Where do you hope we end up in this range? I mean if I try to read between the lines here and I assume a range of 90% to 110%, not with specific numbers, it seems like 100% might be a median, but maybe you could just help us out on where you would hope estimates end up for the year ahead.

Yes. So when we did not particularly provide official guidance on revenue at the moment, we certainly feel very confident in terms of the number of sites. And I think if your analysis though is in the right ballpark, in the sense that we're looking at least 42 sites this year, which we have provided. And if you look at the math that Tom provided in his presentation, I think if you add up all of those, you're sort of going to end up with the range that you just described.

Understood. That's helpful. And I could just sneak in one more question. You talked about the dynamic of recurring versus capital mix in the future, and you still believe in that 70-30 longer-term range, but in this year ahead, I mean I'm just looking at the fourth quarter results, I mean, the mix was something closer to 40% recurring, 60% capital, roughly. I mean is that the sort of mix we should be thinking about for 2026?

I believe the number of sites will increase, and with the addition of 42 sites at $0.5 million each, we can expect significant growth. Therefore, for at least the first few years, a 50-50 or 60-40 split seems reasonable. However, it's important to remember that we are mainly a recurring revenue company. We discussed this in detail today to highlight how TULSA compares to others, showcasing our confidence in our position. This confidence stems from seeing TULSA implemented, with our devices being increasingly utilized. Long-term, I think expecting a 70-30 mix is quite reasonable.

Our next question comes from the line of Michael Freeman with Raymond James.

I'm going to ask a question about the CAPTAIN trial. It's exciting that you've decided to share information on the trial next week. Can you explain the decision-making process for releasing this data early? Does having an early look at this trial compromise it in any way? Is it still considered a Level 1 trial? As a follow-up, do you anticipate that the early release of this data could potentially speed up reimbursement timelines for private payers?

So yes, thank you. Those are important questions actually. So let me answer your second question first. I do expect that the earlier data will certainly give us more confidence in getting coverage decisions this year. But to your first question, a little bit more technical. We are very careful, as you know, on making sure that our data when we present that our trials are pristine, and then with proper analysis and guidance from leading physicians. So as we looked at this, and it just happened in the last couple of days, as we looked at all this, those precedents are typically used and the reality is that 6-month data actually is a very important milestone data set. In fact, particularly for urinary incontinence, and it's used routinely in BPH trials, for example. And we have, as Mathieu described, there is sufficient data already out on the robotic prostatectomy arm with respect to margins, so which is a sort of indicator of the success of early treatment or not. So we're not presenting any data that will be considered out of the ordinary here. These are standard endpoints, and they are measured in a way that are very credible. So we are not going to compromise anything. We are running the company with a very strategic mindset. So we're absolutely not going to compromise anything. But having said that, I think you will see meaningful standard data that will be credible.

I would like to know more about the discussion regarding progress towards cash flow positivity. Can you provide a threshold, such as scale or timeline, for when you expect Profound to achieve cash flow positivity?

Yes. If you examine the data we have published, you will find that in the first half of this year, our cash burn was just over $10 million each quarter. In the third quarter, it decreased to about $8 million. Analyzing the fourth quarter, our cash burn has reduced to just above $6.5 million. You can start to observe this trend, which aligns with our revenue growth. There may be some fluctuations in certain quarters as we add personnel and their integration may not be perfectly timed, but we feel comfortable and confident because we see this trend developing. If you project the numbers, as Tom mentioned, we believe that we can achieve profitability with revenues in the range of $80 million to $85 million. Currently, we are around $24 million to $25 million in revenue, and based on our cash plan, you can see the path to reaching those $80 million to $85 million targets. With the growth rates you can likely forecast from our installed base, it is reasonable to expect that you will be able to reach these projections.

Okay. All right. I'm going to squeeze a quick one in. You provided good guardrails on TULSA install expectations for the year. I guess, more granularly looking at the first quarter as we're well progressed. Wondering if you could provide some commentary on, I guess, the pacing of those installations through the year and how first quarter is proceeding.

I'm sorry, I couldn't hear everything you said. If you could please repeat it?

Sure. I was looking for some color on TULSA installation progress during the first quarter. And also how we might expect pacing of those procedures through the year, given your expectations that you provided earlier in the call.

Oh, I see. What you mean is that you're looking for detailed information on a quarter-over-quarter basis?

That's right.

So we're trying to get to a standardized way of announcing numbers, and we think more standardized is end of this quarter. So which is why we were at 78. We are higher than that today for sure than we were at the time. But I would say, again, I think generally speaking, med tech companies grow in the second half of the quarter. So I would say if you're modeling, I would model it sort of increasing quarter-over-quarter and not linearly every quarter.

Our next question comes from the line of Scott McAuley with Paradigm Capital.

Already been covered, but maybe I could just ask on the BPH module. Any granularity on how many of the installations are currently using it?

Good question, actually. I would say there are at least 10 sites that have already started using it. In terms of the forecast, I think the numbers are increasing pretty rapidly, I would say, by mid-year, we will have at least 30, 40 sites using it.

That's great. And there was a few announcements around international expansions and agreements. And I think in the margin discussion, there was a comment on some kind of introductory pricing, I believe, maybe for international, but I may have misread that. Any kind of progress on the international front for TULSA?

Yes, that's a great question, Scott. In the latter half of last year, we began to gain significant attention in international markets. Although we've traditionally focused on the U.S., which currently accounts for 90% of our attention, we recognized the global nature of healthcare. Not engaging with international opinion leaders didn't seem logical, so Tom and his team have partnered with several distributors, as mentioned. The discounts were specifically for these new distributors to help them get started. There were no discounts applied in the U.S., and we do not anticipate any in the future, which is why Rashed is confident that we can maintain the 70-plus percent margin we've achieved this year and in many previous quarters. Our approach in the international market remains cautious but is conducted through distributors. We will have support and senior personnel overseeing these distributors, but we do not intend to establish a direct sales team internationally; that’s reserved for the U.S. We are definitely seeing strong interest, but Europe may progress slowly until reimbursement decisions are finalized. However, the Asian markets are showing great promise.

That's great. And down the road, as that international presence and impact grows, is that something you're going to separate out a bit more in terms of U.S. installations versus global installations and revenue relative to each of those areas?

Yes. Over time, we will. Once they become material, we will.

Just one clarification. We do break out the international revenue. So there is a segment reporting, that's where we do break out revenue source where is it coming from.

Yes, yes, definitely. I think it was more the international revenue specific to TULSA, but as it becomes more meaningful down the road, maybe be more specific around that.

Our next question comes from the line of Chris Potter with Northern Border Investments.

Just on the utilization question. From your customers' perspective, can you just talk about how many procedures per site they're looking for in terms of it making economic sense for them? In other words, I think if I'm doing the math right, each of your sites is doing 20 or 25 procedures a year now, which didn't sound like a whole lot. You gave the example of having 200 systems doing 50 procedures a year, is 50 procedures a year kind of the ideal for your typical customer? Or is it higher than that? I would think it would be higher than that.

Yes, many of these sites are quite new, and the ones we installed in the fourth quarter are hardly utilized. To get a more accurate estimate, we should consider about 60% of the installed base. However, we believe that aiming for 50 procedures per site is reasonable. Some sites are performing over 100 procedures, while others that adopted the system early were only doing around 10 procedures a year. With reimbursement now available, these larger hospitals are gradually starting to increase their activity. As private insurance reimbursement begins to take effect, we expect further growth. So, while we currently are below 50, we think aiming for 50 is a solid target, and reaching 200 sites is achievable too. In the long term, if we do average 50, we might not be fully satisfied, but as I mentioned previously, with TULSA Day allowing us to treat various conditions together, we now have enough patient volume to make 50 a very achievable goal.

That's helpful. Would you expect that the average utilization per site would increase materially in 2026?

I believe that in the second half of 2026, we will see a shift in our sales approach. As Tom mentioned, we're moving towards a hunter/farmer model, where the farmers' team will focus more on utilization than before. In the past, lack of reimbursement meant it wasn't a priority, but now we're integrating our genius team into the commercial organization and building a farmer-based sales team. I think this team will enhance the startup phase for new sites and improve utilization over time.

And I'm showing no further questions at this time. And I would like to hand the conference back over to Dr. Menawat for closing remarks.

Thank you so much for spending the time with us. We really appreciate the attention. We are excited about where we're going, and we look forward to updating you at the end of Q1. Have a good evening.

This concludes today's conference call. Thank you for participating, and you may all disconnect. Everyone, have a great day.