Good afternoon, and welcome to TransMedics Second Quarter 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. We will be facilitating a question-and-answer session towards the end of today's call. As a reminder, this call is being recorded for replay process. I would now like to turn the call over to Brian Johnston from the Gilmartin Group for a few introductory comments.

Thanks, operator. Earlier today, TransMedics released financial results for the quarter ended June 30, 2022. A copy of the press release is available on the company's website. Before we begin, I would like to remind you that management will make statements during this call that include forward-looking statements within the meaning of federal securities laws, which are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Any statements contained in this call that relate to expectations or predictions of future events, results, or performance are forward-looking statements. All forward-looking statements, including, without limitation, our examination of operating trends, the potential commercial opportunity for our products, and our future financial expectations, which include expectations for growth in our organization, regulatory approvals, and reimbursement, as well as guidance and/or expectations for revenue, gross margins, and operating expenses in 2022, are based upon our current estimates and various assumptions. These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated or implied by these forward-looking statements. Accordingly, you should not place undue reliance on these statements. For a list and description of the risks and uncertainties associated with our business, please refer to the Risk Factors section of our quarterly report filed with the Securities and Exchange Commission on May 5, 2022. TransMedics disclaims any intention or obligation, except as required by law, to update or revise any financial projections or forward-looking statements, whether because of new information, future events, or otherwise. This conference call contains time-sensitive information that is accurate only as of the live broadcast today, August 1, 2022. With that, I'll now turn the call over to Waleed Hassanein, President and Chief Executive Officer.

Thank you, Brian. Good afternoon everyone and welcome to TransMedics second quarter 2022 earnings call. As always, joining me today is Stephen Gordon, our Chief Financial Officer. Before discussing 2Q results, let me first briefly highlight our $60 million debt financing agreement with CIBC Innovation Banking, which was announced earlier today. The new facility, which was fully funded upon closing, enabled us to retire our previous debt arrangement with OrbiMed and strengthen our balance sheet to provide further financial flexibility. We greatly appreciate the partnership we have with OrbiMed and very much look forward to establishing a successful partnership with CIBC in the years to come. Now let me shift to our exciting 2Q results. Through the second quarter, our commercial momentum accelerated, with results delivering an unequivocal statement on TransMedics growth potential and our commercial execution post FDA approvals of our OCS technology for three large transplant markets. Importantly, our performance in 2Q underscores the significance of NOP, or the National OCS Program, as the main growth driver for our business in the United States. Let me summarize the results. For the third sequential quarter, we posted record year-over-year growth in net revenue. Net revenue for 2Q was $20.5 million, representing 151% growth over the same period of Q2 2021 and approximately 29% sequential growth from Q1 2022. Importantly, 88% or $18.1 million of Q2 revenue came from the U.S. centers, representing 215% growth over the same period from 2021. NOP attributed revenue accounted for approximately 84% of our total U.S. revenue in Q2 '22. We fully expect that NOP will remain the main driver for our U.S. business for the foreseeable future. Stephen will cover the details of the organ split in his section of the call. Now let me discuss some other trends that make us confident in our near and long-term growth potential. First, for the second sequential quarter, liver led the way across our three organ markets. This is indicative of our ability to quickly scale operations and build momentum in the largest of our three addressable markets. We were also excited to see that liver centers have quickly acclimated to the NOP concept. Second, heart and lung also continued to grow sequentially, despite overall U.S. lung transplant volumes remaining below pre-COVID rates and a slower than normal June in the U.S. across organs. This slowdown was reflected in the U.S. National OPTN reports and is a relatively normal phenomenon in transplantation, as we experienced a rebound in rates in July. Third, as we highlighted earlier, NOP drove a significant portion of our U.S. revenues in the second quarter, validating our expectations that it will continue to do so for the foreseeable future. As I stated earlier, 84% of our total U.S. revenue came from NOP. On a per organ basis, liver was approximately 99% NOP; lung was approximately 93% NOP; and heart was approximately 57% NOP. As we move forward, we expect to see the percentage of NOP continue to be high and grow across the board, especially for heart transplant numbers. Notably, given the high contribution of NOP, our revenue represented impressive growth in actual new cases and not just stocking orders. This is one of the most interesting and important features of NOP as it makes our business more linear in terms of revenue growth, as we further penetrate transplant programs. Furthermore, it is important to note that 2Q results came from a fairly modest number of transplant centers, between 6 to 12 in each organ category. This is important for two reasons. It shows that we have a significant greenfield opportunity for commercial growth from adding more U.S. transplant programs or centers to use our NOP program. This is a critical area of our growth strategy that I will touch upon later. Second, it shows the continued deeper penetration of OCS within this initial number of centers that are relying on us to operate their transplant programs. This is huge from a competitive positioning standpoint. TransMedics NOP is becoming an integral part of many U.S. transplant program workflows. Lastly, we had a very successful 2022 ISHLT conference in Boston in April. This was the first live meeting since COVID, and we were very encouraged to see TransMedics OCS and NOP as the clear focus of this meeting. There were several featured presentations on OCS Heart, DCD, and EXPAND results, long-term outcomes of OCS Lung EXPAND results, and the first public presentation of the NOP program's concept. Importantly, we took this opportunity to publicly launch an aspirational U.S. initiative to double lung and heart transplant numbers over the next five years using the TransMedics NOP program. In all, we were very encouraged by several trends through Q2 and believe we have positioned TransMedics to achieve 100% year-over-year revenue growth in '22. Now let me discuss our strategies to deliver on this expectation and to extend our momentum into '23 and beyond. First, by expanding our NOP infrastructure. This is critical and will include increasing the number of surgical staff, especially on the liver side, expanding the number of launch points to gain broader geographical coverage in the U.S., and growing our clinical support staff. Importantly, we need to grow our transportation and logistical network to drive efficiency, execution, and financial performance. Second, by expanding our manufacturing and production capacity. We are well underway to tripling our production cleanroom infrastructure by year-end, enabling us to meet the significant demand of OCS use across all three organ platforms. We are also expanding our production headcount and instituting a second shift. Additionally, we're continuing to bolster our raw material inventory to meet the growing demand and mitigate supply chain risks. Third, by increasing the number of active NOP transplant programs in all three organ markets. We have seen the significant impact from a modest number of active transplant programs in the U.S. on U.S. revenue over the past three quarters. We are planning to methodically grow our number of active NOP programs in the U.S. throughout '22 and into '23 and beyond. Finally, by continuing to invest in our next-generation OCS technology and our next organ programs. This is critical to our long-term growth and further distancing ourselves from any potential competition. In our view, the roadmap forward is clear, and we believe strongly that we are operationally well-prepared to take these critical next steps. However, while we believe we are in the early stages of a rapid growth trajectory, we also see the current macro environment and the rapid increase in demand for our OCS technology could present challenges that may create some level of bumpiness in our business. For clarity, let me provide some perspectives on what we view as potential uncertainties that may negatively impact us in the second half of '22. These are the main reasons for us being prudent and cautious in our expectations throughout '22. First, global supply chain issues impacting the scalability of our production capacity to meet the growing demand for our OCS technology. 2Q results continued to outpace our forecasted demand plans and challenged our finished goods inventory. Our operations and supply chain team has been doing a phenomenal job of mitigating the risks of any backorder situation. We remain cautious, however, because we are concerned that our continued investment to rapidly increase our raw material may be negatively impacted by unforeseen supply chain issues from one of our vendors or suppliers. The second is the scaling up of NOP infrastructure. The time to recruit, train, and certify clinical staff to be fully functional in the field presents a potential time lag, while we are rapidly growing our case volume. We are instituting several initiatives to standardize our clinical training programs for our field team, as well as continuing recruitment efforts throughout the United States. Third is access to charter air transport to maximize coverage and availability. This is an important area, as we are seeing global conditions limit the availability of chartered flights used for organ transplant support in the U.S. We are actively expanding our network and will aggressively pursue new strategies to minimize this risk on our long-term growth potential. Fourth is the impact of summer vacations and year-end holidays on second half '22 revenue. It is the norm that August is a fairly slow month for our international transplant activities given the impact of summer vacations in Europe. Q4 will also have the impact of Thanksgiving and Christmas holidays, which may negatively impact transplant volumes in the United States. Finally, COVID. We see minimal or no impact of COVID on heart and liver transplant trends. However, as we stated before, lung will always be disproportionately impacted by any new COVID waves or variants. Based on our 2Q and H1 results and balancing these great results with potential growing headwinds, for the second sequential quarter, we are raising our annual revenue guidance for the full year '22 to between $67 million to $75 million, up from $59 million to $65 million for the same period. This represents a solid 121% to 148% growth over 2021. We take guidance very seriously, and we wanted to ensure that we are being prudent and reflecting the realities of the potential growing pains. With that, let me turn the call to Stephen to cover the detailed financial results for the quarter.

Thank you, Waleed. I will now provide some additional detail on the second quarter results and other financial information for the quarter. For the second quarter of 2022, our net revenue was $20.5 million. This is an increase of 151% from the second quarter of 2021 and a sequential increase of 29% from last quarter. In the U.S., net revenue was $18.1 million, representing 215% growth over the second quarter of 2021. The organ breakdown is as follows on U.S. net revenue: $9.6 million from OCS Liver, $5.9 million from OCS Heart, and $2.6 million from OCS Lung. I'll repeat those numbers again for the folks listening: $9.6 million from OCS Liver, $5.9 million from OCS Heart, and $2.6 million from OCS Lung. All organ products grew sequentially from the first quarter of 2022. Outside of the U.S., our revenue grew 9% on a constant currency basis. However, taking into consideration unfavorable currency movements, reported revenue was $2.4 million, down 1% from Q2 of 2021 and included $2.2 million of OCS Heart and $0.2 million of OCS Lung. The key driver of Q2 revenue performance was further utilization of the OCS across all organs, in particular our National OCS Program continues to be the critical commercial vehicle for further customer adoption in the U.S. Gross margin for the second quarter of 2022 was 70%, which is up from 68% in the second quarter of 2021 and down sequentially from 76% reported in Q1 2022. The improvement in gross margin from Q2 of 2021 is a result of the higher revenue and fully commercial revenue in the U.S. The sequential reduction in gross margin is a result of the higher mix of NOP-related revenue. We expect gross margin to improve in the future as we move out of the early phase of NOP and improve its efficiency. Total operating expenses were $24.1 million in Q2 2022, a 56% increase over Q2 2021 operating expenses. A significant increase in expenses was again driven by the growth in our commercialization efforts in the U.S. and our NOP in particular. This represents our continued investment in our regional resources and the infrastructure to allow us to access more national program transplant cases across all organs and all regions. We also saw growth in R&D primarily related to the development of our next generation OCS. However, as we described last quarter, R&D spending was sequentially lower in Q2 2022 due to less next-gen development activity this quarter compared to last quarter. Our operating loss was $9.7 million in the first quarter of 2022 compared to $9.9 million in the second quarter of 2021, and our net loss for the quarter of 2022 was $11.5 million compared to $10.7 million in the second quarter of 2021. Cash, cash equivalents, and marketable securities were $58.1 million as of June 30, 2022, which equates to a reduction of $13.9 million from the balance at the end of Q1 2022. Weighted average common shares outstanding for the quarter were 27.98 million shares. Finally, as Waleed mentioned earlier, we took an important step to provide additional financial flexibility in July of 2022 by refinancing our existing debt with a new $60 million term loan with CIBC Innovation Bank. A portion of the new loan was used to pay off the balance of our prior loan with OrbiMed, and the new loan added approximately $23 million of new cash to our balance sheet. And as I usually do before returning the call to Waleed, I would like to reconfirm that the increase in our revenue guidance for 2022 is $67 million to $75 million for the fiscal year, representing a range of 121% to 148% growth over 2021.

Thank you, Stephen. In summary, we're very pleased with our 2Q performance. The TransMedics NOP integrated approach has clearly proved its unique ability to streamline the transplant process for transplant centers and drive significant growth. Our demonstrated ability to execute on rapidly scaling the NOP to include liver and hearts over the past two quarters, along with launching new initiatives, leaves us more confident than ever in our ability to continue to drive significant commercial growth throughout '22 and beyond. As we stated before, we believe we are still fairly early in our growth trajectory, and we are laser-focused on continuing to build on our commercial momentum for the future. We are inspired and excited for the future of TransMedics as we continue to transform the global organ transplant landscape across geographies and cement our global leading position in transplant therapy. With that, I will now turn the call to the operator for Q&A.

Thank you. Our first question comes from Bill Plovanic with Canaccord. You may proceed.

Thank you. Good evening. I have a couple of questions. First, regarding guidance, I need to ask about your $67 to $75 million target. You achieved $36 million in the first half. This implies a range of approximately $30.5 million to $38.5 million for the second half of the year, which suggests a decline in the latter half. How many of the potential headwinds you mentioned are you currently facing, or are they more of a future concern? I'm trying to gain clarity on what's included in that range.

Thank you, Bill. The guidance we're giving is the guidance we stand by. The rapid growth and acceleration in utilizing our finished goods inventory have really put a lot of challenges in our ability to continue to beef up that inventory. So that is something we're experiencing today. The other thing that we're experiencing today is our ability to cover many cases when finding enough air transport charter flights to be able to cover many cases in the same evening. The others are more cautionary, just understanding the dynamic and what it would take to scale up the NOP and the training programs, etc. So we wanted to be prudent, to be cautious, and to be thoughtful in our estimates. But that's as we see it today. We will continue to look at the guidance, and we will continue to refine the guidance as we continue to execute throughout this year.

Excellent. Thanks. And then what do you see as the greatest impediment for a transplant center for adopting your technology? One of the comments was regarding the kind of concentrated success you've seen. So what's been the impediment in getting to some of the other centers to adopt at this point?

I don't see it as an impediment, Bill. We have been engaged with a fairly broad number of centers. It's just the time it takes for them to wrap their heads around the NOP. We all know that the transplant community is a very conservative group. They've been doing it one way for the past 50 years. Here we come transforming that completely into a more streamlined process that is managed by a third party. So we want to be prudent. We want them to get to where we are in their own time. We don't want to force anything. Just the time it takes for them to come to terms with the NOP is really it. Part of that is understanding that any service cost in addition to product cost is coming from the organ acquisition cost center, and seeing the outcomes that are being delivered using NOP compared to outcomes through the direct acquisition. This is really it. We're growing, and we’re proud of the number of centers that have adopted NOP, but we don't see major impediments. It's just the time it will take to convert the bulk of the market to NOP. We have to be careful not to rush things. Let things mature at an appropriate pace because we are transforming the standard of care. Everybody knows that transforming the standard of care doesn't happen overnight. We're laying that solid growth foundation for '23 and '24, not just '22, which is why we’re being prudent and careful to allow centers the time they need to grasp the NOP concept.

And last question was, there was an article in the post today. I think the real question is how the breakup of UNOS impacts you, especially given that UNOS oversees the OPTN? I think they had the Wednesday Senate hearing finance committee meeting.

Yes. Bill, as I've said publicly numerous times, we don’t have any interest in commenting on any legislative or federal mandates to break up UNOS. I don't think UNOS is going to be broken up anytime soon. We have to continue to play within the construct of the federal structure of organ transplant. What we present into this argument is something very positive, something that presents a solution, not pointing to an antiquated part of the system. We point that the OCS and the results achieved by OCS represent the highest rate of solid organ utilization in the history of organ transplant in the United States. Number two, for the last 18 months, the NOP has demonstrated significant success in growing transplant program volumes by accessing new donor pools like DCD donors and extended criteria DCD donors, and TransMedics is managing that successfully to perform more cases. The case number is growing quarter-over-quarter, month-over-month, and daily. So that's what we present. We present a positive solution to this complicated problem. We will operate within any federal structure, whether it's UNOS or another structure. We don't see that as something that we should be too concerned about. But we want to make sure that our voice, our data, our technology, and our NOP is factored into all these national discussions around revamping the organ transplant system in the United States.

Thanks for taking my questions.

Thank you. Our next question comes from the line of Cecilia Furlong with Morgan Stanley. Your line is now open.

Thanks. This is Calvin on for Cecilia. Thanks for taking the questions. Two from me. First, I wanted to ask more on heart traction within the NOP. It sounds like heart and OP mix stepped up from 30% to about 57%, which is a very positive update to hear. So I'm just curious, where do you see that level trending exiting 2022? But also, what has worked, or what have been some of the learnings as you've been ramping up education for these cardiothoracic surgeons towards adopting OCS?

Thank you, Calvin. Where do we see that trend? Up. We're working very hard to make sure that the trend continues to grow and for the heart to match the other two organs. What's the biggest learning? The biggest learning is to focus on the quality of the clinical management of the organ and deliver a better organ than one that's managed by the institution's staff. That is our laser focus with our team. Without that, it will be difficult to convince people to leave control to our team. As I said to Bill's earlier question, we understand that very well. We know that the cardiothoracic surgical mindset is very focused on outcome. They've been trained to manage their own organs for many decades, and it's going to take the time it takes. But for us, we lead with data. We convince them by showing them that if we manage these organs for them, the outcomes will be better than if their team manages these organs.

Got it. Great. Second question really is on account ramping. I was wondering if you could talk a bit more about pushbacks or discussions you've seen as new centers contemplate the cost for NOP, what ultimately gets them comfortable? And really, how long is this process taking currently? Also, what's baked into your guidance around navigating this initial account acquisition process and timing associated with it? Thanks so much.

Thank you, Calvin. As I mentioned earlier, we focus on two main aspects when onboarding a new NOP center: ensuring they understand the process and how easy it is to implement. We want them to grasp the workflow and recognize that while it is different, it's not significantly so, and they will always maintain control over the clinical decision to accept or decline an organ. The second aspect is to clarify that every cost associated with the service component, excluding the technology aspect, is included in the organ acquisition cost center. Our guidance reflects our expectation to double revenue in 2022. Currently, we are concentrating on establishing a solid foundation for growth in 2023 and 2024, which requires patience as we allow centers the necessary time to become long-term partners, rather than just making one case per quarter. This is all incorporated into our guidance. Specifically, we anticipate ending the year with around 10 to 12 active centers per organ, meaning centers that utilize the technology at least twice per month throughout the quarter. While some organs are closer to reaching this goal than others, that is our target as we move forward.

Thank you. Our next question comes from the line of Josh Jennings with Cowen. Your line is now open.

Hi. Good evening. Thank you, gentlemen. Congratulations on another strong quarter. I wanted to start by asking about guidance. I apologize for another question on it, but I want to clarify that the upper limit of your guidance does not suggest you have indicated there are market conditions to consider. You're not suggesting that there is a capacity constraint regarding your current NOP infrastructure or any supply limitations that may arise as you grow. The $75 million figure is not a ceiling for 2022; it reflects your cautious outlook for the business in the latter half of the year.

That's exactly correct, Josh. As I said to Bill, we are not experiencing any definitive headwind or negative situation other than demand ramping up and far outpacing our original forecast and updated forecast; that's the only thing we know. Because of that, we want to be prudent, cautious, and conservative. Again, we take guidance very seriously. I want to reiterate that $75 million is not the absolute ceiling for '22. It's the prudent number that we stand by to ensure that as we are scaling up, we're not inadvertently causing any disruption or issues that may negatively impact our growth ability in '23. Again, our laser focus right now is to be able to be in the same situation in '23. So that’s why we're being very deliberate and cautious, giving centers the time they need to ensure we have a solid foundation exiting 2022.

Excellent. That's clear. Thank you. Just my follow-up on just the drive by CMS, HHS to reform the U.S. transplant network but also to grow volumes. I think there was a great data point that Arizona shared in terms of their liver transplant volume growth in Q1 after adopting NOP. Are there any other anecdotal cases you can share just in terms of high volume transplant centers in any organ indication where they've seen that type of growth? It seems like that's occurring and Arizona is not a one-off. Thanks for taking the questions.

Thank you, Josh. I think rather than naming individual centers, I will reiterate what I've discussed publicly before. Based on what we see, we are almost certain that we will see an overall increase in the number of heart and liver transplants in '22 over '21, driven primarily by extensive use of DCD livers and DCD hearts using the OCS and NOP program. So there’s more than just Mayo Arizona; there are several large liver transplant programs that are becoming significantly dependent on NOP, integrating it into their workflow while growing their volume by accessing distant donors, whether DBD or DCD. The DCD utilization in the United States is at an all-time high throughout the first half of this year just looking at the OCS data and NOP data that we have.

Thank you. Our next question comes from the line of Suraj Kalia with Oppenheimer. Your line is now open.

Good afternoon, Waleed, Stephen. Can you hear me all right?

We can hear you just fine, Suraj.

Perfect. Congrats gentlemen on a nice quarter. So, Waleed, two questions. The first one, a multipart question. Waleed, how many sites were doing multiple organs and utilizing NOP? What would predispose one to use NOP for one organ and not another? And maybe Stephen could jump in, just give us some guideposts on the number of sites in each organ so that we can triangulate the utilization aspect?

Sure. In the second quarter, there were a total of 15 centers using multiple NOP programs with OCS, spanning all three organ categories. Most of the multi-programs are utilized in at least two out of the three organ categories, if not all three. However, some logistics at individual centers can hinder this. For instance, one center working on heart transplants has taken four months to recruit additional lung transplant surgeons to revive their lung transplant program, causing delays. There are factors beyond our control, but we are optimistic that by the end of the year, our initiatives will lead to more centers adopting NOP. Over the next two years, we are targeting the same number of centers as mentioned earlier: around 30 to 40 transplant programs in each organ category, which comprise 80% of the transplant market's volume. That is our focus for the next 24 months. Our goal is to conclude 2022 with 10 to 12 of those 30 to 40 programs converted to NOP and regularly using OCS as part of their standard practice throughout the quarter.

Yes. And Suraj, I think we look at it by organ. What I would say is we talked about 6 to 12 centers for each organ category. The high end is on the heart, as we have many heart centers, because we dealt with a lot of heart centers historically. The low end is on the lung, which is the challenged market with COVID, and the liver is somewhere in the middle. So, without being specific, that should give you a sense of where we're at.

Fair enough. Waleed, I have one more question. Is NOP really the key driver? When we look at OUS, I’d appreciate a comparison and contrast of OUS; there is obviously a large total addressable market in the U.S., which we understand. Additionally, I didn't hear you mention the shortages in dobutamine and dopamine in the market. I assume that's not affecting you, but I would appreciate any further insights on that. Congratulations again, gentlemen, and thank you for addressing my questions.

Thank you, Suraj. I think the biggest macro difference between OUS and U.S. when it comes to implementing NOP are two things. One, the lack of national reimbursement in OUS markets; that is a huge impediment. The second is some of the European regulations are very different than U.S. regulations when it comes to organ transplant. For example, in Italy, it is illegal for any member of any other medical center to accompany a donor organ on the charter flight back to the transplant program. Some esoteric rules, like that, could make NOP difficult outside of the U.S. However, we have positive experiences with replicating NOP in the Netherlands. The only difference is the NOP model in the Netherlands that we worked with them to establish is fully managed and funded by the National Healthcare Authorities in the Netherlands. They’ve grown their heart transplant volume by nearly 40% last year using the OCS equivalent of NOP, where three devices with three trained teams covered the entire heart transplant programs in the Netherlands, and they're doing great. As I stated in my previous call, there's interest from the UK NHSBT to explore replicating the NOP from our experience. Again, dealing with NHSBT takes a long time, but we're working closely with them. We will continue to pursue this. We're also pursuing hybrid NOP models in Germany and Italy. But these are the initiatives we have launched to continue driving growth OUS until national reimbursements are achieved.

Thank you. Our next question comes from the line of Allen Gong with JPMorgan. Your line is now open.

Thanks. Congrats on the great quarter. Sorry to again touch on guidance, but I guess just to kind of like put it a different way, you've highlighted that there's a healthy amount of conservatism being put into your guidance, which I think we can all agree is really prudent given the continuing macro challenges. But with summer representing a bit of a challenge in the third quarter and then holidays presenting a bit of a challenge in the fourth quarter, how should we really think about the cadence of growth from second quarter to third quarter and then fourth quarter? Does the middle range of guidance assume essentially flattish trends, or should we think of maybe a little bit of a softer third quarter and a step up in the fourth quarter?

Hi, Allen. This is Stephen. I would think of it as a flattish trend. Waleed mentioned we saw a rebound in July, so we have some indication that, at least July, was decent. So I would think of it as flattish over Q3 and Q4.

Yes, I agree. Again, we just wanted to be as realistic and prudent as we can. We hope that we don't see a downtrend. But we expect, if one of these things impacts us, it will be more of a flat quarter-over-quarter.

Got it. And then how should we think about operating expense growth? I think relative to our forecasts, that came in a little bit higher than we were expecting in the quarter, which makes sense, given all the investments you're making and the momentum you have commercially. But I think the last time we got a guide from you was on the fourth quarter of last year where you pointed to 25% to 30% expense growth. Since you're getting so much momentum, investing into that probably makes sense. Should we think about that as at least being at the higher end of that, or maybe even being even higher than 25% to 30%? Thanks a lot.

Thanks, Allen. That's a good question because we did see a little bit of higher spending than planned due to really supporting the growth that we're seeing and getting ahead of it. I think at the last call, I talked about expense growth being about a third of the rate of revenue. We probably need to take that up a little bit. So like from a third to maybe 40% at least for the next few quarters.

Thank you. There are no additional questions waiting at this time. So I'll pass the conference over to the management team for additional remarks.

Thank you all very much for taking the time to be on this call. We're looking forward to the next call. Have a great evening.

That concludes the TransMedics second quarter 2022 earnings conference call. Thank you for your participation. You may now disconnect your line.