CONNEQT Health Limited ($CQT)

It's now 9:00 a.m. here in Sydney, so we'll make a start. Welcome, everyone, and thank you for joining today's webinar for an update on CONNEQT's business and operating activities for Q3 FY '26. My name is Rod Hinchcliffe from M&C Partners, and I'll be moderating the call today. And with me on the call is CONNEQT's Chairman, Niall Cairns; Chief Executive Officer, Craig Cooper; and Chief Strategy Officer, Catherine Liao. The format for today, Craig and Catherine will take us through the update, which will be followed by a question-and-answer session based on some questions that have already been submitted. And just a reminder that today's webinar is being recorded. And with that, I'll pass over to you, Craig.

Thanks so much, Rod. Well, good morning, everybody, and thanks for joining the call. This morning, we're going to take you through an update on CONNEQT's third quarter. We'll also talk about our growth drivers for the Pulse as well as how we're looking at customer acquisition and also some key sales metrics. I just jumped ahead of slide -- someone's jumping ahead of the slide, but that's quite okay. We'll also give an update on the positive early traction we're seeing with our enterprise sales business and how we are scaling that model. And then I'll finish with some insight into the rest of the year and into 2027 as well as some questions. All right. So before we jump into the quarterly highlights, I just really wanted to sort of look back over the last 16 months as to really where we have come from really what we call day 0 when we launched Pulse under what was then the CONNEQT business -- excuse me, the Cardiex business. So if you remember, that was a business that had mostly one-off unit sales in research and clinical. We had no subscription or recurrent revenues in that business. We had less predictable market sales, which were being impacted by not just policies of the current administration in returns of the cutback and research sales, but we also saw sort of a tempering of the pharmaceutical research and grants that were being handed out, which clearly was impacting our business. And then also, we only had a single product line, which was the XCEL product. So fast forward to where we are today, 16 months seems like such a short period, but we've done a lot in that time. In that time, we now have a predictable top line revenues for the Pulse that importantly, we know how to scale. We have a model that's based on customer accessible pricing, which is together with recurrent SaaS and app-based revenues, which previously we didn't have. We were really pricing ourselves in a sort of very high-end market of pharma business as well as research and sort of high-end clinicians. So everything that we've done over the past 16 months has really been driven to driving sort of product adoption at scale in terms of the markets that we've been targeting and pricing into those markets has been a huge part of what we've been doing in that period. We also have a high-margin annual recurring revenue contract business that is in its infancy with the new enterprise solutions that we're offering to the market, and Catherine will take us through that. And then importantly, we also have a technology pathway that provides us with a licensable platform for third parties to integrate by year-end, and we'll talk about that a little bit more as we proceed through the deck. And I think from the perspective of any standard, we've shown tremendous quarter-on-quarter growth since day 1 of the launch, over 50% quarter-on-quarter growth for each quarter. So that's been just a testament to the team, the momentum we have and really driven by strong execution across the board by everyone in the company. So as most of you may have seen from the quarterly, our Q3 revenue was a little over $2 million, up 25% from the previous quarter. So a great result. Pulse now the primary growth driver in the company, contributing a little over $1.1 million with accelerating momentum throughout the quarters. So as I mentioned, over 50% quarter-on-quarter growth since launch, which I think any start-up in early age company, looking at these numbers, I think these are numbers that most companies would die for, particularly given that we are a consumer Rx medical device, which really distinguishes us from other products on the market, just given the sort of uniqueness in terms of the marketing of the sales process and the acquisition process for new customers. So -- but even with that, our Pulse sales are accelerating with a run rate approaching $7 million. So it's just a great result all around. Research revenue has also rebounded. So a strong period for our research team, principally led by Ric Ruffhead out of our Naperville office in Indiana. So a great result from Ric in terms of that market. And then as I mentioned, early contributions from our enterprise business, which Catherine will talk about shortly. And we ended with a strong run rate scaling to $10 million on an annualized basis, obviously, uplifted by everything which is happening with the Pulse, our research sales and also the contribution revenues that we'll start to see accelerate on the enterprise side as we further move through the year. So great demand. We've now normalized supply. We had a hiccup in the middle of the quarter, which we'll talk to later in the presentation. We have our enterprise channel, which is scaling. We have put in place the foundations for recurrent annual recurring revenues in respect of both the Pulse as well as our enterprise business. And we've really seen across the board strong market validation for the business, as we move forward. So on all fronts, a strong quarter, continuing with the growth of the previous quarters and really validating everything that we've been building and had a vision for over the last few years. Niall will talk about the capital and funding position towards the end of the presentation. But in the quarter, we had some initial sort of capital infusions from some strategic partners. We have some ongoing funding in process. As I said, Niall will talk about that shortly. And then on the cost side, we've continued to optimize our operating costs by each quarter and consistently decreasing them in order to really provide a platform for us to meet our profitability targets in a much quicker manner. I mean we've been very, very closely watching our operating costs and optimizing across all offices over the course of the past 4 quarters, even though we've been growing, scaling, adding staff, but ultimately, even with everything that we're doing, we're still managing to reduce our cost base. So increase in our operating revenues consistent quarterly performance from the top line and consistent quarterly deductions from the bottom line, all driving us towards a better financial opportunity as we move forward. So from the perspective of where we look at growth going forward, these are the key things that really we're focused on, obviously, led by the Pulse from the consumer side and really expanding the base at scale because really, the more we expand from a device perspective, the more we have from a revenue contribution basis on a lifetime value, just given what we're seeing from an uptake on the digital purchases that are being made in the app. So it's really -- we look at the Pulse is really the razor of the razor blade model. So once we get the Pulse embedded in someone's home, now the opportunity is from the perspective of everything that we're layering on top of it to really add incremental value from the perspective of digital subscriptions, memberships, some of the other initiatives that I'll talk to as we move through. But really, it's the foundational base for everything else that drives the economics of the company. And supported, as I mentioned, by the recurrent revenue models that we've been putting in place for both enterprise as well as for consumer, and that's mostly founded in the in-app cardiology reports, which we'll talk about for both consumer and from the perspective of enterprise adoption. Catherine will talk about this concept of this 2-market flywheel in terms of how each of the enterprise and consumer markets that we're targeting support and drive each other from the perspective of brand, market recognition and ultimately new customers. And then from a product perspective, everything we're doing from an app from the perspective of what we're building into the current Pulse as well as the next version 2 of the Pulse as we move through towards the end of the year, everything is driven towards driving engagement around the product, increasing lifetime value, increasing retention, making this a product that's sticky in the home as part of someone's wellness program that becomes an essential longevity tool for them. And then as we move outside our core base of target customers at the moment, we're looking across the insurance market, the pharma market and some of these other networks that may not seem like the sort of core opportunity for us, which we're focused on at the moment, but we're seeing real opportunities amongst some of these high-value segments that we can integrate our devices into, which provide sort of meaningful analytics and impact, but more importantly, from the perspective of examples, for example, like insurer Healthcares for employer run insurance plans. So we're excited about that. And then expanding into data analytics, given the amount of data that we're really sucking out of the device and from the perspective of the readings and the analytics that we're getting from the app, and I know we talk about Biomarker-as-a-Service. It's something we're really excited about as we move forward. It's something that stands alone in regards to the licensing opportunities for the platform for third parties as well as a platform that allows us to really expand our own markets with our new product releases in terms of how we look at those going forward, whether -- and we'll talk about that as we move through as well. So that's how we look at the growth going forward. We're supported by all the research that continues to come out in the market around the sector from the perspective of arterial health. We feel like we're unique in this whole sort of wellness market in respect of the fact that we -- part of a consistent narrative from us at a lot of the conferences that we talk to and at the podcasts that we do, when everyone is talking about supplements and sleep wearables and performance wearables, our sort of narrative is very much grounded in the fact that everyone is talking about really the wrong thing because the thing we should be really talking about is the #1 thing that kills us. So we can't talk about longevity unless we talk about cardiovascular health. So we're really seeing that sort of folded into the narrative more and more as we move forward. And we hope that we are a sort of principal driver of that given everything that we're doing in the market from the perspective of advocating in the sector. And we're also seeing it continually through some of these large sort of category owners as well. And I know I quote Oura and WHOOP a lot. And from the enterprise side, companies like KardiaMobile and AliveCor. But we got a note from a shareholder asking me why I talk about CONNEQT and Oura when their market cap is now $11 billion and we're only $25 million. Well, I've never talked about any of them in the context of us being comparable on a market cap basis. I've always talked about them in the perspective of them being really what we call category owners. These are companies that have really, what I call, put a flag on the moon in terms of owning these categories from a brand perspective. and have been able to show that at scale, when you really own a category like sleep, like performance fitness, like blood biomarkers, like continuous glucose monitoring, then that's really the opportunity that we are targeting. And I can talk about this a little bit more at the end during the Q&A because I think it's important to sort of point out sort of where we are sort of on the growth trajectory as against these companies when they started because when you look at the analytics around WHOOP and Oura, which both recently, for example, just got $10 billion and $11 billion valuations. These are companies that were founded in the sort of the 2015 era. And when you look back and analyze those businesses, those companies took 2 to 4 years to get to a $10 million run rate. on their products at the time. They hit an inflection point in the following years after that when they started doing subscriptions, but that was not something they were doing in the early years. So for us, we've really taken all those learnings. So in a sense, I feel like we are -- we are where they are earlier than when they started to have their inflection point, just given the history of both of those companies. And sure they are huge businesses, but that's really our vision. That's really what gets us up in the morning in terms of not so much what the differential is from the perspective of market caps and how we can reach that, but really what the category opportunity is for arterial health, given that it's -- as I say here, it's the largest unclaimed biomarker category. I challenge anyone to really identify anyone who has sort of ownership of this sector, which is the largest health care sector in the world. It pales -- sleep and fitness and everything else sort of pales in comparison to cardiovascular health. So it's really ours to lose, and that's what we've been really executing against. So I might just pass it over to Catherine for the moment to lead us into a discussion around product.

Absolutely. Thank you, Craig. So as Craig has articulated, CONNEQT is just not a single product story, right? It's really 2 -- it's one platform that serves 2 market segments, and that strengthens one and the other together because enterprise gives us the credibility, the institutional relationships, validation and recurring account revenue, whereas consumer gives us reach, engagement, that longitudinal data and that then feeds back into more research, more knowledge, and it creates this lovely flywheel effect that I talked about. And we are seeing that kind of playing together. physicians are seeing the ads that we are running for the consumers reaching out saying, how do I offer that in my practice? Consumers are reaching out to us and say, "Hey, I'm looking -- can you refer me to a physician that can help me dive into my reports further. And so we are becoming that very critical component, linking these 2 sets of market together. And this is truly the strategic value that we have created that where each of these markets strengthens the other, right? And together, this is really the growth and the value that we are able to extract by playing and offering what we offer.

Next slide, Catherine. Shall keep moving.

No, I got it. It caught up. So what makes this really powerful is that the same core cardiology assessment can operate across both the home and in the clinic. We are standardizing on the set of arterial health biomarkers that go beyond the traditional brachial blood pressure, as you know, right, and really focusing on these advanced measurements around central blood pressure, central hemodynamics that really tells us a better story around how well our arteries are aging and then that -- how that really impacts overall health, disease progression and ultimately longevity. And so the best thing about this is that these are not wellness or vanity metrics. They are clinically meaningful and doctors trust them. And so we now can take these measurements and actually do risk predictions and basically be able to say, hey, what is your chance of increased likelihood to have heart attacks, stroke, heart failure and really now give people a set of insights and their clinicians the tools and the know-how to now be able to really slow down a trajectory that may be negatively impacting someone's health. And so that's really differentiated. And as Craig has said, right, we are positioned in a category creation type of opportunity here. No one -- no one can do this with a noninvasive repeatable assessment that identifies something that is truly meaningful and clinically credible. So when you look at the broader screening market, right, most tests are expensive, episodic and structural. So full body MRIs, soft plaque phenotyping with clearly, calcium scores and even carotid screening and DEXA scan, which is for body composition, they'll have a role, but they are generally just a onetime snapshot. And so we are fundamentally different. We give that both an in-home and in-clinic assessment that truly quantifies the risk of really heart diseases. And because it's repeatable, it can be done at the comfort of the home. We now are beginning to capture the longitudinal monitoring, right? We have customers were that we have generated not just tens but hundreds of these reports for. And it's so incredibly satisfying seeing the impact that we have on people's health. And then I will pass it back over to you, Craig.

Thanks, Catherine. So as we mentioned at the outset, strong growth from a consumer perspective. This gives you an idea of really what the scale of that growth has been like since launch. And as I also said, even sort of more remarkable given that it's an Rx consumer medical device. So we ended up Q3 just a tad under Q2. We'll talk about that in a little bit more detail at the end of the call, how -- what happened, how we fixed that, solve that from a go-forward basis. But regardless, ended up that quarter still pretty strongly given that we had nearly 4 weeks without supply of our large cup devices. So you can imagine the scale of growth for Q3 if we had that in place. But regardless, we're trending well through to Q4 as we move through to the end of the financial year. And internally, we're looking at growth from a little over $1.1 million up to $1.75 million. We're well on the way to that as we stand. So all positive, all around from the perspective of growth as we move forward. And then importantly, something that's not focused on as much is really what we're doing from an in-app purchase perspective because this is really going to set the foundation of the -- or one of the key components of recurrent revenues for Pulse sales as we move forward. And this is exactly what Catherine talked about from an enterprise perspective in terms of the reports that are provided in clinic across our network of partners that we're contracting with. These are the same reports that are generated both on the app as well as for download through the app for sharing with your physician. The full 12-page cardiology report, which is a very detailed view of all the SphygmoCor biomarkers with explanatory notations in a format that can be shared with your physician. And really, this is what we've seen as the sweet spot for us in this sector in respect of a unique offering across the market landscape. No one else can do it because they don't have the technology that we have from the perspective of our legacy SphygmoCor technology. So it's really up to us to lose, as I keep saying, in terms of evangelizing, educating and really monetizing this report as much as possible. But early results for really the last 6 months, 13% of customers who buy the device are now purchasing additional services by the app, principally the cardiology report. 74% of those are selecting the annual plan. You can choose both an annual plan or you can buy it just on a monthly basis. So these are great numbers from really a standing start 6 months ago. 50%, again, it's kind of the magic number for us in terms of quarter-on-quarter growth since we launched Care+. And I might say from a team perspective, this was not an easy task from a software, from an in-app integration, from an app store integration, from a delivery perspective to get this up and have this delivered in the time frame that we did, but it's going to be one of the core foundations as we move forward from the perspective of our ongoing revenues. So we thought we'd give you a sort of a snapshot of how we look at acquisition because the marketplace that we operate in it's -- obviously, we're a medical device. We're Rx. We require a subscription for the device for the moment. It's a seamless process, which happens in the back end when you make a purchase, it happens in seconds. And there's really a pretty sort of limited funnel that you have to go through in order to get it. You just really just have to nominate that you're over 18 years old or you're not pregnant. So it's not something which is a significant blocker for us, we believe, from a sales perspective. What it is, though, it's an extra cost from the perspective of COGS. It's small, but still all those costs add up. So anyway, putting that aside, how we look at acquisition is extremely holistic because there's just not one touch point for customers in the consumer market, in particular, when we're talking about the Pulse. So we have to be present really everywhere. So organic search, we have a huge content engine and a team that's daily churning out content, very sort of medical and sort of educational content around using the device, the biomarkers, cardiovascular impact of using our device. It's a content machine that drives both the search engines as well as the requirements of the LLMs for the major AI engines, which are always looking for content in order to sort of fuel their engines. So we build it both from a perspective of organic search as well as for the LLMs. Paid media as well is a big part of our promotion. So principally on Meta, which are Facebook and Instagram. So that's where the majority of our paid acquisition dollars are going. So we run sort of at times anywhere from 15 to 100 ads across those platforms. So a big part of the team's activities is built around that with great leadership that we've recruited to run our paid media team. Social and creators is massive for us from the perspective of sort of creating mind share about our business, reaching out to the creator community, doing some paid collaborations with influencers on Instagram, having a constant cadence of social posts that can be shared across people's networks. So we have a group running our social team. Our PR also is a big part of us. We have a PR group that all day is just reaching out to whether they're influencers or conference organizers for speaking gigs, podcasts for speaking gigs, just the whole sort of landscape of publication. So it's a big part of what we do. And then e-mail and customer relationship management, which is, for us, together with social, a key component of driving our cost of acquisition. So we need to get to a point that we have a balance of organic and paid acquisition media. So e-mail is a huge part of that. So from day 1, when many of you remember when we started our newsletter sign-up campaign before we even released the Pulse, we were starting to acquire e-mail addresses. So we've continued with that. We run pop-ups. We run campaigns for people who have abandoned their carts. We run onboarding campaigns. We run e-mail campaigns, which allow people to share discount codes and so on and so forth, really adopting best practices for that. And then referral and partnerships. A lot of these are collaborations we do across the social channels as well as what we're doing with our physician partners and the affiliate networks that we're part of. And these are really groups that super distribute our product into these affiliate networks of not just physicians, but influencers, content creators, and other people who want to run a affiliate codes for us. So we need to be seen everywhere. It's not just one thing. When people purchase good, they may see it on Facebook, they may search it on Google. They may do a search on it on an LLM. They may look across the social channels. It's really a different world today than it was even 2 to 3 years ago in terms of the funnel for acquisition. So we need to be everywhere where people are, and we need to provide educated content in order to show what an impact we can have on someone's life and really use all of these platforms to really what we call sort of translate mind share, which is really what we're doing here into market share through acquisition of our product. And then from the perspective of how we look at it financially, I mentioned this concept of blended CAC, which is customer acquisition cost. So it's a key component of everything that we do on a day-to-day basis. I mean, really, this is like a stock market screen for one of a better analogy for a number of our team members who sort of live on in these metrics all day and are constantly within the major ad platforms that we're using for paid media turning the dials, twisting or moving the levers and really looking to optimize it on a really minute-by-minute basis. So it's a key part of, obviously, the economics for us. It's a key part of the contribution margin to profitability of the company as we move forward. And together with its closest cousin in this, which is the COGS, the cost of the goods sold, those 2 really make up sort of the key components of what we are continuously optimizing and mindful of in terms of driving contribution -- net contributions to profitability as we move forward. So key components of that. Care+, as I sort of stood up in one of the previous slides, these are all recurrent contribution margins that are going to continue to grow and scale the more we get products in the market. So not just from the perspective of everything that's doing -- being happening from an enterprise perspective, but also principally at the moment from the perspective of how many devices we can get into the market. So the more devices we get in the market, the more opportunity we have to upsell them on recurrent programs around principally the cardiovascular report at the moment and really build out a more clearer view of what the economics are going to be looking like as we move forward, just given sort of the early stages that we are at, at the moment. And all of these really fit in and sort of contribute to how we look at each product sell from a lifetime perspective in respect of lifetime value. So from a perspective of product sale, from the perspective of COGS, from the perspective of acquisition and attachment rates in respect of new products moving forward, be that the cardiology report, be that new products that we're looking at standing up such as telehealth appointments as we move through towards the end of the year. It's really how much we can use the device, how much we can layer on top of the device going forward given the thousands of customers that we're going to continue to sort of scale, who have an identified need for a whole suite of products that we can start to roll in as we move forward. So that's kind of how we're looking at it as we move forward. So I thought I'd just sort of end on the consumer side with just some highlights around how we look at this whole opportunity from a marketing perspective and just sort of showcase some of the highlights around some of the successes over the past quarter and the months sort of preceding that. So I talked about Instagram and how important it is from the perspective of building reach, building social sharing and awareness. It's just a couple of slides in terms of where we've come from over -- from the course of the last 3 periods. So we actually hit 5,000 Instagram followers this afternoon. It kind of popped up on the screen, which is nice. Our followers is great, but more importantly, views and shares are really what we follow. So we have a small, relatively speaking, sort of organic following at the moment, but we get strong sharing, we get strong views across all the videos that we stand up across our Instagram channel. It's a mix of educational of lifestyle so -- and product based, I should say. So we cover a full gamut, and we have a sort of regular cadence around Instagram as we move throughout every week. But one of the highlights, as I mentioned before, was everything that we're doing from an e-mail marketing perspective. So particularly from the perspective of contributions to operating costs. So the bottom right slide, you'll see that this is a representation of the actual contribution from e-mail marketing from the perspective of the last few quarters. So you'll see we started off small, which is really when Meghan joined us who we brought on to really scale out our e-mail marketing. We saw the early signs of growth. And this last quarter, we had $85,000 that came through. And this is really revenue that came from a mix of e-mail campaigns of newsletter marketing. It's also abandoned carts. Hey, we see you left your product in your cart, how can we help? Is a discount, so on and so forth. So it's meaningful as we move forward and as we scale. So the challenge for us now is by drilling down on the metrics more in terms of how we acquire more e-mail customers. and then really putting this whole sector under a microscope as we move forward so we can really start to drive much more meaningful economics around this. So I'm not saying that this isn't great to see. This is really very welcome, just considering we were doing 0 in this in the quarters before this. So we're all really happy with the way e-mail marketing is going, and it's going to be a big part of us going forward. And I think if you're on Instagram or any consumer sites as you scroll, I think you'll see that a lot of companies are using e-mail marketing to great effect. So I'm just losing control a little bit here. So let me see if I can get through. Catherine, do you want to go the next slide or might be still under your control? Thank you. So the app is a big part of it, what I've been talking about in terms of stickiness, in terms of keeping people engaged, particularly not just from the perspective of their sort of journey with us, but making sure that journey is a long run, and we retain them as long as possible because the cost of acquiring customer is much greater than the cost of keeping them if we do our job right. So we put a lot of energy into what we do from an app and an experience perspective. And I know a lot of you in Australia don't see this because the app is not as readily available, but it's a key component of the development team and everything we're doing from an update perspective this year. We're hoping to roll out version 2 over the course of the next few months with a number of sort of key technology enhancements and then towards the end of the year, work towards a refresh. But a big part of the business is obviously the app. It's the purchasing vessel, of course, for the cardiology report. So that's why we want to keep people engaged as we move forward. Next slide, Catherine. And then we talk about our industry impact at the top of the hour. So you've seen some of these as we've moved through the year, but it's super important to us that in the short time, again, 16 months since we've really been alive with the product, just the recognition that we've received across the industry. And most recently sort of headlined with the American Association of Retired Persons announcement last month in their sort of best of 2026, which was huge for us. So it's the largest media business of its type in America. So we are super excited to get that on top of everything else that we've received over the course of the period since we've launched. So it's a big part of it. It's headlines for us, sound bites across all the marketing that we do. It's validation. So it all goes into the part in terms of making people feel comfortable with the product as they move towards making an actual purchase. Next slide, Catherine. Just a little bit on what social looks like for us if you're not on Instagram. So just a few snapshots, educational discounts, sort of personal lifestyle stories and pure product-based sort of Instagram posts. So just a sort of highlight if you haven't seen it. Next slide, Catherine. And then Amplifying CONNEQT, as we call it across the larger stage with everything we're doing from the perspective of sort of building the public profile, whether it's live events like you see Catherine here at NextMed Global Health Conference, which I was at last November, other events that we're both targeting. Catherine is very, very active in the community. She's doing a PhD in sort of vascular health, focusing on arterial sickness and vascular aging. And so that's just been just a massive sort of entree for her to the sectors that we're trying to get into from the perspective of the clinical markets and which has really built out a huge base of, I will say, fans in the sector, just given the specific focus around vascular aging, which is just sort of a massive component of the whole wellness and longevity movement here in the United States. So we're also on podcasts and we're setting up little pop-up stores all over the place and at events and the major conferences. So just an idea from an industry perspective of sort of how we're -- what we're calling sort of amplifying the business as much as we can. Next slide, Catherine. And then just finishing on the consumer side, just to sort of stand up a couple of sort of headlines that we're focused on around vascular aging, which I mentioned, which we feel will be an extremely unique and valuable biomarker to us, which we will be providing as part of the app update in version 2. It's important to note that we won't be doing it as what's called a wellness biomarker, which is really what comprises pretty much all of the devices, all the wearables, all of those are sort of wellness components. So our goal is to get an FDA-cleared vascular age biomarker that we can validly market across the clinical market as well as the consumer market. And as we move towards our strategy of having Biomarker-as-a-Service and being able to launch that within the app as opposed to in the device as an extra layer of subscription biomarkers. We think this is going to be a key driver for us from a product perspective. And then look, it's a no-brainer for us to move into telehealth in respect of the cardiovascular health market. As I said, we have an embedded customer base. By the time this launches towards the end of the year, we'll have thousands and thousands of customers, which are receiving cardiology reports every month and it's just a natural progression for us to then market them into a telehealth consultation with a cardiologist as part of that process. So these are kind of the low-hanging fruit of many things that we're focused on at the moment, but key components as we move forward. And Catherine, with that, I'll pass it over to you to talk a little bit about enterprise.

Yes. It's all very, very exciting. And I have to commend the team, especially focusing on consumer marketing because believe it or not, consumer marketing is a key driver into the enterprise business as we see it as well. As I've mentioned earlier, right? Doctors and clinicians, they are also consumers. And so they'll see an Instagram video from an influencer, that influencer could be another doc talking about how they are using a CONNEQT Pulse to better treat their patients. And to talk about the cardiology report, which then drives another doc onto our website. And then, of course, our website is designed to actually delineate between consumer offering and professional offering, which then drives the clinician now to explore more about the clinical offering and then reach out. And so it's a really, really lovely cycle that we have created and I'm just so proud to be part of the team to deliver that. And so earlier this year, we introduced per assessment model in clinical offering. So ranging from $8 to $15 per assessment depending on the commitment from the clinic. And what the idea is to do is really shifting our conversation with the professionals from a traditional, a very expensive capital equipment purchase to tying really the usage of the assessment into how they grow their clinic and how they grow their practice. And across the customer types, the use cases are actually starting to -- we see a pretty consistent trend, right? So Sports and Performance Labs use it for athletic optimization and recovery tracking. In the Primary Care and Preventive Clinics, they use it for annual wellness and early detection of vascular aging as what Craig has said. And then Special Clinics use it as a diagnostic adjunct to intensify treatment or accelerate further diagnostics and then also for longitudinal monitoring of how effective the therapies being applied is working. And the key here is that this is not a onetime test, right? It becomes part of the routine care, which means that every patient interaction becomes a revenue event for our professional customers and that's also tied to a clinically meaningful signal for them. And of course, I mean the -- and as we've gotten to know throughout this presentation is that the opportunity for us is not in the devices themselves, it's in the data that we have synthesized into a report that classifies someone's heart health into green, yellow and red and then to be able to then take further actions that lowers the barrier to adoption through a subscription model and a bundled pricing, so which means that we remove the frictions on new clinics from implementing this. And secondly, that we prove value at the practice level, right? So it's not just about increasing revenue, which some of the clinics care about, which is very much our cash pay, but it's also about improving their clinical care, the efficiencies on how they are treating their patients and really enhancing the quality of care through better risk stratification. Third, we embedded directly into workflow for a lot of our customers, everybody takes a blood pressure, right, when you go to a clinic. Well, instead of taking a blood pressure with just a traditional Omron professional blood pressure monitor, right? They take blood pressure with the XCEL. And that just -- and then by doing so, they now immediately get more insight into how well and what is the patient's health. So this is very critical. It sits alongside the vitals intake. It's not an optional add-on. And fourth, the clinical usage drives consumer demand, right? Because now someone -- a patient gets a report from their clinician. They may not have seen our ads, for example. But now they see this information. They are now looking at it further up. Nothing like having a report that then you share with your friends, your family to kind of go, hey, especially talking about boosting, right? Hey look, my heart health is all in the green and just the power around being able to share that and then how that naturally triggers to somebody else says, hey, I want to know that too. How do I go about to get this? And so just that traffic light has just been -- the reception that we've gotten from it has been tremendous. And then, of course, finally, every report generates recurring revenue. And as we grow that, right, it's now -- you can kind of see the multiplier starting to happen. And that's how we really scale the business without scaling the headcount linearly because traditionally, if we are selling a device, each rep can only sell so many -- makes so many interactions, so many calls, sell so many boxes, if you will. But now once we are as an embedded subscription-based business, right, once we are in, we are part of the workflow of our customers, right. As they grow, we continue to grow without needing to resell into them every year. But what we do need to do is that we invest in customer success. We invest in making them successful so that this becomes part of their core business capability. And then we want to share a case study, and I mentioned this last time when we spoke exactly this is what it looks like, and I'll give you a quick update. So a customer that we have is a 70-location sports performance franchise. They were a pilot site at the end of the December quarter and then we converted them and have started implementing into different locations. So starting from 1 pilot at the end of last calendar year to now, we are getting close to about 10 or so into the sports clinic and then we continue to add new clinics month in and month out. And for them, this is a natural complement to what they already offer, right, adding cardiovascular insights along body composition, metabolic testing and performance assessments. And the great thing for them is that there's no need for new infrastructure or staffing, right? It sits alongside -- they already have the infrastructure to do a resting metabolic rate. Well, there's already a chair, there's a room, there's already a protocol on how somebody rests. And so by adding a 3-minute assessment, it's almost like it's obvious and they see attach rates to their existing -- to how their customers are coming in. So -- and they just love that this becomes such a natural part of their standard testing stack, right? And so -- and really what we position and what we actually also add credibility to these clinics because they start with being very much sports and fitness-centric and performance-centric. Now we add a clinical layer, right, that fills a gap that no other test address, which is central hemodynamics, arterial performance, vascular health. And the lovely thing about this model is that this is actually repeatable across multiple verticals and practice types. And so what we are very, very focused on is make -- get access and begin working with a customer network, make that network successful and then we move on to the next one and then we move from the next one. We have been very, very deliberate because it's all about -- it's not just about selling somebody our offering, right? Because I mean, our offering is a very accessible and very modest starting point, right? So anybody can get started with us at -- with USD 6,000 a year to about AUD 10,000 in that first year. That's not where we are starting, right? It's meant to be an easy lever for them to pull. But what it is, is that we want to make this now entrenched into their business so that next year, that usage grows, but they also see their revenue growth. So their business grows, we grow and they grow some more, we grow some more. And so this is that kind of scaling effect that we start to get to exponential growth that I'm very, very excited about. So -- and with that, I will pass it back to Craig to tell us what's coming.

Yes. I might point out, Catherine, as you know, we're starting to build a team to drive and lead the integrations of the enterprise solutions. DexaFit is a great start, but you've also been rolling out across clinical networks and building that. But it's been really our in-house team that's been doing it at a very base level. I mean we built the cart that we showcased there. This is not something that's come out of mass production. We printed it. Our Chief Technology Officer actually printed the cart at his home printer and we've built that out. So that's really the offering that we're putting in. But now that we have a team in place, it's really just a question about scale because I think we've talked about in the past, we've had a 100% success rate on our rollout and integration and from an inbound perspective. So we just need to scale that out because those numbers really starts to click as we move forward. Thanks, Catherine. All right. So -- looking forward, what's on the radar. So obviously, focusing on expanding CONNEQT and with the Pulse and supercharging those growth rates, 50% quarter-on-quarter is going to be -- it's a top line for us and a North Star. But look, we're having research reports coming out on us, which are putting our stock at sort of 7x what it is now based on 20% quarter-on-quarter growth. So within that sort of range is where we're going to be targeting. We know we can turn the dial up. It's just a matter of optimizing the underlying economics of it. And there's an inflection point with current economics that we start to have a net positive contribution to operating costs, which kind of scale pretty quickly towards profitability. So you'll see some changes from a product perspective over the course of the next 3 weeks, which will assist us in this from a pricing perspective. We've kind of played with prices with the product over really the whole period since we launched because the product has been really very price inelastic. We've priced it anywhere from sort of over $400 to down to $249 with different sort of offerings and attachments with the cardiovascular reports that go with it. But we feel like we should be participating sort of more at the top end from a price perspective. We really have not seen that much elasticity in price or I should say, in purchasing from the perspective of that sort of range of prices that we've been offering over the course of the product's launch. So look out for some changes in that regard sort of at the top end, which will help us drive the bottom line much quicker. Look for expanded offerings within our enterprise product, which are in the pipeline at the moment. And from an app perspective, as I mentioned before, we'll be making some sort of key technology changes over the course of the next 2 to 3 months as we move forward. So really, that's -- from where we're seeing today, really, that's what our key focus is. Obviously, from a top line, from a Pulse perspective, making sure we hit our targets at a minimum about 25% sort of quarter-on-quarter on the current growth as we move through to December, which is sort of where we're targeting from the perspective of the sort of $1.7 million that we're looking at for the current quarter. So we're positive about that. That will be, again, another tremendous achievement for us. It's not something that's a one-off. We need to get to a point where we're scalable on a consistent basis at a growth rate, which is sort of underpinned by the economics of the business. I mean this is a tried to say, I know, but this is really what sort of drives us on a day-to-day basis. So we're working both at the top line from the perspective of pricing, but also from the bottom line from the perspective of the V2 of the Pulse as we move through this calendar year, which will be a very, very unique device integrated with our SphygmoCloud and our Biomarker-as-a-Service, which will enable us to have an app-based pricing system for everything that we do from the perspective of biomarkers, telehealth function, everything will really be pushed up to the app out of the device, which will basically become a [ Duma ], not a completely dumb block, but a Duma block with limited capabilities, which will be most likely an OTC device, but we'll be pushing all our SphygmoCloud parameters up into the cloud and all the pricing of those will be implemented on a subscription basis. And we think that's going to be a game changer for us when we launch that. And that will also provide a basis for us to also enable that those biomarkers as services to other companies. And I know we've talked about this in the past, but this is the reality of how we will be able to do this. And getting FDA clearance as a Biomarker-as-a-Service is a very unique opportunity, something that we're already in pre-discussions with the FDA. So we'll be enabling that process rapidly as we move throughout this year. But this for us from a company perspective, will be a game changer. So look out for that. I know we've talked about integration with wearable companies and other parties in the past. This will provide the basis for that, but more importantly, provide the basis for us to enable us to charge, optimize and include all our biomarkers in an app as well as decreasing our cost of goods on the products at the base level. So at both ends, it's going to be economically profitable for us once we implement that as we move forward. So really, that's the focus from a dev team perspective, apps, SphygmoCloud, Biomarker-as-a-Service, Pulse V.2. These are things that we're having our weekly roundups on from the perspective of the team who are working on that. So it's a high priority for us. And then I talked about previously, just some of the sort of more headline things like expanding Arterial Age, telehealth and premium subscription features. So all of those and sort of that channel are really what are driving us and what we believe are going to be fundamental to really supercharging the trajectory of the business as we move forward and -- so we're super excited about that. And then following on from that, just expansion of everything we do. Once we get the platforms in place. I mean so much of what we do is really just enabling the opportunities as opposed to putting them into the market. So I'm the guy who's always saying, I want something tomorrow. And the team is always sort of tempering me from the perspective of that just in terms of what it takes in order to get things together. And I think we've shown you over 16 months what we have been able to do. I think and everyone wants more, but the fact that what we've delivered from sort of day 1 from the perspective of, as I keep saying, an Rx consumer medical device, I mean, most companies would die for those numbers. And I will tell you, if we weren't -- if we were listing today without any history with those numbers or if we listed 6 months ago, I should say, IPO'ed with those numbers, without any history, I mean, we'd be a $200 million or $300 million company. If we were -- I would say, if we're in the U.S., absolutely. In Australia, I would say the same. Because of these numbers and this growth, these are the sort of market valuations that we are seeing. So we need to get off the chair that we're on and really start to get together as shareholders in terms of driving the opportunity, supporting us as we move forward. As you know, Niall and I have continued from day 1, 6, 7 years ago, led every round in the business from a capital perspective. So we're there right there with you at much greater levels than everyone else. So this is something that we have a huge vision for. We believe there's a big market for. So we think we've shown that we have everything in place now. So with that, I'll leave it. But just to summarize, growth in Pulse sales accelerating quarter-on-quarter, app purchases accelerating quarter-on-quarter, positive traction in enterprise. $10 million annualized group run rate in less than 16 months when you include the Pulse, predictable growth drivers, which we know how to dial up and importantly, the platform for an acquisition engine, which is focused on maximizing net contributions to profitability. So all of these are good news. So with that, I'll finish up, and thanks to everyone, for jumping on this morning. And back to you, Rod. I think we may have some questions if we didn't already cover everything.

Yes. Thanks, Craig. We do have a few questions, and I know you've covered a number of these already, so I'll be quick with some of them. First one, in the quarterly, you noted Pulse exited March at an annualized run rate of approximately AUD 7 million. And in April is tracking for another record month. Can you talk about what is driving that momentum, whether you believe the growth is sustainable? If so, what sort of growth rate should we expect moving forward?

Yes. I think I covered it in respect of what that sort of top line is from the perspective of maintaining our growth rates going forward, 50% quarter-on-quarter. But from the perspective of the floor sort of 20% to 25%. So as I said, we're continuing to play with the dials to optimize growth, obviously, also being capital conscious as we move forward from the perspective of new orders and inventory costs and everything else. But when we look at growth, the key components of that are really all the factors that go into making a sale from a product perspective, which I talked about from the perspective of everything we're doing across all the parts of the company that are driving that acquisition engine. But then also being equally, if not more mindful of the bottom line, the cost of goods and the cost of acquisition and all the metrics that play into the economics. But look, we've just shown constant growth every quarter since we launched. Let's not start thinking that's going to stop and suddenly wonder whether it's just magic that we're doing it. It's not. It all comes together because we are driving an efficient acquisition engine, an efficient engine from the perspective of growth in sales. So we're going to continue to do what we do. But as I mentioned, optimize everything we can from a COGS perspective in terms of decreasing the actual cost of goods sold and product as well as the internal components of the product are 2 key parts of that because the chipset that goes in is a significant component, which I might add, we'll lose that once we migrate into operating with a Biomarker-as-a-Service in the app. So that will come out of the cost base. So we're doing everything we can from the bottom line to decrease costs from a product perspective and optimize sales at the top end as well as meeting the growth targets without just having growth for growth's sake.

Okay. The next question is, can you provide some more detail on the large cut supply issue, how it impacted sales and how it was resolved?

Catherine, do you want to jump in?

Sure. I can speak to that. Well, so it turns out that majority of our customers purchase large cuff. And that shouldn't be a surprise given the American demographic and our customer profile, right, tends to be majority men. And so what we saw is that we basically after Christmas, we ran out because we had such a great demand going into our Christmas marketing, the promotions and essentially, all the orders even post-Christmas essentially consumed all of our Pulse sales, and we basically had them ready, they were in transit. But of course, as you know, there's -- sometimes there's so much we can do with the logistics company and we simply had to wait for the boat with the containers on them with the devices to essentially show up. So what it resulted in is that we had some pretty clever workarounds. What we were able to do is essentially take small devices, ship them with the stock of spare large cuffs that we have, which we do keep on hand. That bought us some pretty good amount of time into the middle and kind of towards the end of January. But then still the boat didn't show up again, right? Boats come. You can see it on a belt in the ocean. You can see it sitting at port and the time between it arriving at the port going through customs is unpredictable timing. And then from the customs being released on to a train and from the train on to the truck to get to even our warehouse, it was basically a set of visibility that we didn't have nor did I have our logistics company. And so, so much of the inventory slowness is just due to the fact that there were factors out of our control. Now the great thing was that even though we did use that period of time, did a lot of also our testing refinement, our marketing message testing our ads. So then as the stock was replenished, we turned our marketing back on. And I'm really proud to say that typically, if you think about it, in consumer retail, there's usually seasonality, right? You see Christmas thing a high buying season, there will be a drop in Q1 and then it slowly builds up in the year -- for the rest of the year. We maintained linearity from the arguably the busiest shopping season, right, of the year, shopping period into usually the quietest shopping season of the year and we maintained that linearity. And what we are still seeing is now we are continuing now back up towards the upward tick.

Okay. You talked about continued traction in Care+ subscriptions and in-app monetization. How meaningful could this recurring revenue be over the next 12 months?

Look, I think we're very happy with the early growth rates on it and the attachment rates in the app. I'm just sort of running some sort of back of the envelope numbers here just -- so I think -- look, as a guide, assuming we do 5,000 sales, just back of the envelope, we do 5,000 sales in the current quarter with a 20% attachment rate, which will be a little bit of a step-up from where we are now at 13%. And 70% of those taking annual plan at $200. So that's $140,000. So not insignificant. So again, back of the envelope, early stages with it. So it just gives you an idea of sort of how much they can scale. And -- but remember, these aren't one-off purchases. These are customers who bought into the need for these reports and have engaged with us in acquiring them. So the challenge and opportunity for us as we go forward is to make sure we extend the lifetime value out as much as possible. We continue to layer on other value opportunities with them because if they're going to purchase that, we know they're going to purchase something else. We have a fair idea anyway. So they go into a certain capture box for us from an e-mail marketing perspective and a whole sort of funnel in terms of how we look at those customers. So we think it's going to be very meaningful as we move forward and more meaningful than the economics of the device itself.

Okay. A similar question on the enterprise side. The company has 10 enterprise sites onboarded. How do you see these revenue scaling from here?

So the revenue scaling is not just about the 10 enterprise sites, right? It's the next step is getting to 100. If you think about it, 100 enterprise sites each doing, let's say, 3 assessments a day, that is $1 million a year in ARR. So we get the first 100 active and successful, we work on the next 100, get them active and successful and you can see the increase in that. Just as a reference, we know some of our -- in our previous -- our existing, there are customers, but there are customers in the traditional capital equipment model. We know busy clinics will do 16,000 patient engagements in a given year. So to us, that is where the opportunity is from what a single clinic can do. Are we going to get there from year 1? No. Is everybody going to be there in year 1? No. But fundamentally, that's where the market opportunity is for us and that we are -- that's essentially the North Star that I'm aimed at.

Okay. You've touched on this next one as well. With Pulse sales increasing in the different pricing levels you've used, can you provide some detail on the trends in customer acquisition costs and margins?

I will say that I think we covered the question in terms of costs. And so look out for that. We think we're -- well, I'll say we're going to be increasing the cost because we think we have very limited price elasticity. So we'll be increasing the price in the next 3 to 4 weeks, a lot of back-end stuff that has to occur around that. So look for that. From the perspective of acquisition costs, all I'm going to say is that they've been trending positively for the better. I mean we are really zoning in on the opportunity to have consistent 2 to 3x ROAS as we move forward, which is Return on Ad Spend, which will provide sort of significant contribution margin to the company and sort of a much faster track to profitability. But it's a very -- I mean, it's a hard lever to pull. And it's taken us -- well, it took us probably 12 months to get to the stage where we are now that we're much more optimized within principally the Meta Ad Networks. We have sort of high-level coverage of our accounts with the ad representatives across the Meta Networks who are on a daily basis, assisting us in optimizing those numbers better, but that's where we need to get to. But we've had many, many, many sort of months of sort of net positive contributions from ROAS perspective, others flat and others really at the high end. So it's a matter of just getting a consistent band where we're confident from the perspective of our ad spend that contributes a top level -- a top line and sort of a base in terms of contribution to our operating fixed costs. And that's how we're looking at it.

Okay. Can you provide an update on Biomarker-as-a-Service and when we can reasonably expect to see first revenues?

Maybe explain it, Catherine, if I didn't sort of make it clear.

Yes, I think it's probably too early. Yes. So Biomarker-as-a-Service or the idea, so I think you've heard us talk about SphygmoCloud or SphygmoCor Cloud and the idea is that we are moving our algorithm that has historically been locked on to the device themselves. So the translation of the Sphygmo technology can only extend as far as the hardware that we have and the hardware we sell. But instead, what we are doing is that we are taking our algorithm out of the devices itself and we are going to run it in the cloud. So in that case, what we can essentially do is we can talk to any device that gives us a waveform. So the waveform could be from another brachial monitor. It could be from a ring, right, like I'm wearing or a ring, whereby give us a waveform that is validated, we'll work with you to validate that waveform. And then so give us that, pay us a couple of cents or a couple of dollars for us to process that waveform for us to spit back a set of biomarkers that are clinically validated and FDA cleared. And so in Craig's slides, we had talked about what's coming is the PPG development kit. So PPG is the optical sensor in all the wearables today. And what you can imagine is we will be working with device makers that then can give us their waveform and incorporate and begin to display our biomarkers, the SphygmoCor biomarkers into their offering, right? The idea is that we have a tremendous opportunity to not be a hardware company and be a software company. That's where the margins, that's where the multiples really come in terms of where I see the value and where we all see the value of what this company could be. Hardware is expensive. It's slow. Right? Whereas we simply let other people who make hardware give us a signal that we need and only we can essentially transform into all these arterial health signals. And to Craig's point earlier about why do we benchmark ourselves to an Oura, to a WHOOP, to an AliveCor and about the whole category creation opportunity that ahead of us is the fact that we have one 30-year legacy around a set of algorithm that has generated tremendous amount of insights into arterial health. And that is proven, it's credible. Now we are taking that algorithm, putting into a cloud environment that any device can access for a fee. Now what we have done is essentially expanded the reach of these biomarkers, not just through our device, but through every device out there that is touching a human body where there's an arterial signal available for us to access.

Okay. I think you've largely covered this next one, Craig. But recent presentations, you've referred to WHOOP and Oura and their market caps being multibillion dollar. How do you see these companies as comparable when CONNEQT's market cap is so small? I think you've been through most of that.

Yes. I think, look, we never -- as I said, we've never compared on the basis of market cap. But my point was we're already at the transition point that those companies reached much later than us in the process. I mean it took them 3 to 4 years to scale to $10 million to $15 million. It's taking us half that time. So we've got the benefits of all that learning. They spend a lot of time figuring things out, and they really weren't the companies that we see today. And look, remember, everyone starts small. Everyone starts with a baseline. So my comp has always been more from the perspective of the category ownership. But it's also -- when you think about it, when you look at us, we're in a less crowded market. We're in a wide open category, which none of them had. I feel we're achieving scale, 2 to 4x faster than they did in the period that they were where we are now. So there's a lot of positives that we can take around that. But I think aspirationally, we should all be looking to these companies as what we can do, what we can do with everything that we've put in place, how we've scaled over the course of the last 60 months with products and what the opportunity is. Let's not lose sight of that, particularly from the perspective of the fact that we have the biggest health care market opportunity bar none in cardiovascular health. So that's how we look at it. And it's more aspirationally and from a vision perspective. Of course, I want to be like this. We all do. But I'm saying this is just not fancible thinking. There are foundational reasons why we can get there if we all commit to it and make this a success.

Okay. The final question, what is the biggest catalyst investors should look for over the next 6 to 12 months?

Well, if you use one, it's Pulse growth and profitability combined because that's two, consistently meeting our targets from the perspective of growth, scaling up our enterprise business, demonstratable revenues from the app and then a meaningful pathway towards profitability based on net contribution margins from all the products that we are rolling out.

Okay. That's it on the questions. If anyone has anything further, please send them through to [email protected]. Back to you, Craig.

Thanks, Rod. Yes. Well, thank you, everybody, for dialing in. We're a long way from you over here, but just be assured that we're working as hard as we can for all of us as shareholders. And we thank you for your support. As always, we hope you are -- I wouldn't say rejoicing, but as confident as we are in the results that we presented for the quarter, consistent with the growth that we have shown throughout the past previous 3 quarters and that we see you in the next time when we catch up at the end of the fourth quarter. All right. Thank you very much.