Nano-X Imaging Ltd. ($NNOX)

Ladies and gentlemen, thank you for standing by. Welcome to the Nano-X Fourth Quarter 2025 Earnings Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would like now to turn the conference over to Mike Cavanaugh, Investor Relations. Please go ahead.

Good morning, and welcome to the Nano-X Imaging Fourth Quarter 2025 Investor Call. Earlier today, Nano-X Imaging Ltd. released financial results for the quarter ending December 31, 2025. The release is currently available on the Investors section of the company's website. With me today are Erez Meltzer, Chief Executive Officer and acting Chairman; and Ran Daniel, Chief Financial Officer. Before we get started, I would like to remind everyone that management will be making statements during this call that include forward-looking statements regarding the company's financial results, research and development, manufacturing and commercialization activities, regulatory process and clinical activities, among other matters. These statements are subject to risks, uncertainties and assumptions that are based on management's current expectations as of today and may not be updated in the future. Therefore, these statements should not be relied upon as representing the company's views as of any subsequent date. Factors that may cause such a difference include, but are not limited to, those described in the company's filings with the Securities and Exchange Commission. We will also refer to certain non-GAAP financial measures to provide additional information to investors. A reconciliation of the non-GAAP to GAAP measures is provided with our press release with the primary differences being non-GAAP net loss attributable to ordinary shares, non-GAAP cost of revenue, non-GAAP gross profit, non-GAAP gross profit margin, non-GAAP research and development expenses, non-GAAP sales and marketing expenses, non-GAAP general and administrative expenses and non-GAAP gross loss per share. With that, I'd now like to turn the call over to Erez Meltzer.

Thank you, Mike, and thank you all for joining us today. In the fourth quarter of 2025, we continued to move the business forward across multiple fronts. While our primary focus remains on expanding our commercial presence, given the current geopolitical situation, we spent a lot of effort during the quarter and the beginning of 2026 to secure our supply chain and strengthen our financial positions as well. On top of that, we made good progress advancing the capabilities of Nano platform and strengthening the operational infrastructure needed to support our long-term growth. I'm happy to report that we recently entered into an agreement with Howard Technology Solutions, a division of powered industries, which has a national reach and an established presence in health care and public sector market, providing us with a scalable framework for expanding Nanox.ARC deployments. This agreement reflects our confidence in the commercial demand for the Nanox.ARC and our ability to engage partners that can support sustained growth in system placements across the U.S. Other the framework of this agreement, [ Howard ] is expected to deploy 300 Nanox.ARC systems over a 3 years period, of which 60 are indicated to be deployed in the first year. We also recently announced multiple commercial agreement, which together accumulates to roughly 360 [ systems ] over a 2 to 3 years' period. These partnerships expand our reach across imaging centers and specialty care setting where point-of-care imaging is integral to clinical workflow and patient management. This represents a fundamental shift in how we are [ poised ] to scale our business from providing our technology to the [ play ] and a meaningful volume shifting toward a growing CapEx portion. This is what we see and getting us closer to our indicated revenue of 2026. The framework has the potential to become a meaningful contributor over time [ and ] just confidence in our ability to convert our robust pipeline into revenue as we move forward. We view this and continue momentum and see ourselves moving closer to an inflection point. We observed a clear shift in the market perception at major radiology conferences, including RSNA in the U.S. and ECR in Europe, where engagement and inbound interest increased meaningfully. We've also taken important steps to strengthen our operational foundation, a key component of this initiative is the restructuring of cert activities in our Korean manufacturing facility in order to reduce our Korean operation OpEx and cash burn and improve efficiency while maintaining our supply of Nanox.ARC system component. We are very pleased with the progress we have made recently, but it is clear that the pace of deployment continues to be influenced by various external processes, including import licenses, construction time line, and regulatory [ required ] in certain markets. These steps take time to complete. And while we are not setting try with a pace and would like to deployments more faster, this reflects the current operating reality across multiple markets. We expect that many of these processes will streamline as additional sites moved through to the pipeline. Introducing new technology of any time into a medical environment is always complex process. It requires alignment across clinical workflow, regulatory framework, and operational infrastructure as well as changing behaviors which all takes time to achieve it. While this can slow down the early stages of deployment, it is also a natural part of introducing innovative technology into the health care systems. Turning to revenues. We continue to target $35 million in revenue for the full year of 2026 based on the execution of our current plans. Today, as part of the [ above ] mentioned, we have signed a commercial agreement, which we believe could result in present and future placements of [ Tabat400 ] systems globally over the next 2, 3 years, of this, approximately 38 systems are currently adverse stages of deployment, including administration, commercial installation and system spending construction and/or regulatory approval. In addition, there are approximately 15 systems that are expected to be installed over the next few months and start of our non imaging network. That said, it is important to emphasize that our current revenue base remain at an early stage and part of this deployed base is not generating revenue and the pace of [ rent ] prop will depend primarily on the timing of system activation, their transition into a revenue-generating operation and the impact of the deployment by the business partners. As more systems move into operation and utilization increases, we expect revenue to book accordingly. However, the exact timing of this trend may very and always depending on the deployment process and progress and our factors. I will now provide some bit color on the Korea restructuring that I referenced in my opening remarks. Recently, we adopted a restructuring plan designed to better align our manufacturing cost structure with our long-term financial model, support our path toward improved gross margin and align our manufacturing capabilities with the company's strategic priorities. As part of this plan and our broader cost reduction efforts, we are closing our chip manufacturing line in South Korea, downsizing our fabrication facilities and shifting production to established international manufacturing partners including system, a Switzerland-based manufacturing partner. We currently hold substantial emitter inventory, which we plan to work through as we had transitioned to a more efficient outsourced production model better aligned with current and projected demand. With these actions, we expect to reduce structural and overhead costs, low [ our ] cash burn and enhanced overall operation efficiency. With that overview, let's now take a detailed look at our various business segments, starting with the U.S. deployment. Beyond the hardware agreement, we also recently announced a distribution agreement with Imperial Imaging Technology, a U.S.-based provider of diagnostic imaging solution to support rollout across the Southeast, particularly in [ optic ] focused environment where there is strong demand for a point-of-care imaging. In addition, we signed agreements with distributors such as integrity imaging, a U.S.-based provider of medical imaging solution with established relationships across hedging centers, health care providers. Elite Surgical, which serves surgical and specialty care environments, digital X-ray imaging a leading diagnostic imaging provider with deep reginal presence across [ Arcosa ]. And most recently, a collaboration with [ New ] an imaging solution provider focused on expanding access to diagnostic imaging and radiology oncology system to support all to support the deployment of Nanox.ARC systems. These collaborations aim to strengthen our distribution capability by adding sales resources and on the ground presence expands our geographic coverage, and we believe it is the potential to become a meaningful contributor to revenues per time. In parallel, we remain active discussion with additional partners reflecting continued interest from medical equipment providers and likely further expansion of our U.S. pipeline. Alongside our channel strategy, our U.S. direct sales team on the ground continues to make progress in targeted clinical segments. For example, we recently signed an agreement with regional sports medicine in [ Auto ] Group, our first orthopedic practice customer in the United States. This represents an important step into a segment where imaging plays a central role in diagnostic and treatment decisions and where providers benefit from having imaging available on site. Orthopedics remain a high volume and imaging-driven specialty with a strong incentives to retain imaging in-house. Additionally, we are advancing the [ Nano ] imaging network. A focused initiative designed to build a network-based imaging services model in [ the ]. This initiative target segment, such as the workers' compensation and specialized care for reimbursement dynamics may support higher per scan pricing. We are currently deploying already systems across a number of sites in the U.S. Under this model, Nano-X supports Nanox.ARC system deployment, maintenance and connectivity, while our partners manage tight operation and local engagement. While still in the very early stage, we believe this initiative can become an important component of our long-term commercial strategy as the utilization increases and the model is further validated. To provide additional context around this shift in engagement, we participated in two major industry events during the period. At RSNA, the world's largest annual radiology conference held in the U.S., our booth featuring live demonstration of the Nanox.ARC system saw strong interest throughout the event. At the European Congress of Radiology, ECR, the largest radiology conference in Europe, we showcase the Nanox.ARC [ in ] Europe for the first time and presented new clinical and AI data. Engagement levels were high, reflecting growing awareness of the system's clinical value and its potential role in routine imaging world. We were also proud to receive the [ redock ] awards from product design to [ 2 ]6 for the Nano-X [ ARC ] prestigious international recognition that reflects the maturity usability and clinical readiness of our platform. Let's now turn to work outside of the U.S. As I mentioned earlier regarding ECR, we were also honored to receive the newcomer award at ECR 2026 reflecting the growing recognition of Nanox will in the European radiology community. In February, Nano-X announced an exclusive distribution agreement with [ Inter ] a leading medical distributor in Argentina with more than 35 years of experience. Under this agreement, INTECH will oversee marketing, distribution installation and support for the Nanox.ARC system and related services across the country. The collaboration intended to support commercial expansion of Nano-X 3D digital tomosynthesis technology in Argentina and strengthened the company's presence in Latin America, leveraging [ Imec's ] established relationship with the health care providers and nationwide service capabilities. Commercialization will be subject to obtaining the required regulatory approval. In Latin America, we were expected for a significant presentation at the International Congress of Radiology, the ICR in Cartagena, Colombia. The presentation will support clinical discussion around digital tomosynthesis and contribute to engagement with regional clinicians and industry stakeholders. In Europe, we continue to build momentum through partners and additional regional distributors. As a reminder, over the past few quarters, we have announced multiple European collaborations, including France, Romania, Czech Republic, Serbia alongside additional engagement in other European markets. These collaborations support our ability to navigate local regulatory environment and advanced commercialization across multiple countries. Switching gears, we continue to advance dilatory work that supports our commercial initiatives by expanding the use cases for our solution and making them accessible in more markets. We have advanced key milestones, including TAP2D clearance in the United States. As a reminder, TAP2D is the 2D new image output for the Nanox.ARC system, a practical tool for a geologist to enhance their diagnostic confidence as they become more experienced evaluating digital tomosynthesis images in part of our broader vision to alleviate agentive use limitation over time. We also updated the AMR approval for Nanox.ARC in Israel based on our existing CE Mark enabling use of the system without object limitation. Removal of the agent [ usliitation ] in the U.S. remain a key regulatory priority. We believe this is an important step that can expand our addressable market and support broader adoption. We are also working to finalize our CMR submission for the Nanox.ARC in Europe, which is currently anticipated in 2026, subject to change based on regulatory priorities. Turning to our AI business. We continue to strengthen our position as a comprehensive platform for the interpretation of medical images. I'm happy to report that Cedars-Sinai Medical Center in Los Angeles is joining a trial studying the benefit of Nanox.AI aortic valve classification measurement solution, which is currently under development. We have recently conducted an on-site revaluation of the model across approximately 600 retrospective cases. The result exceeded our expectations with six cases over severe classification identified in approximately 100 cases showing clinical relevant findings. The Cedars-Sinai team has also expressed interest in collaboration on scientific publications based on these results. We are very pleased to be partnering with Cedars-Sinai, one of the nation's premier medical institutions. Overall, we are seeing growth in Nanox.AI business driven by new customers, expansion of existing agreements and the integration of Nano-X Health IT. During the quarter, we completed the strategic acquisition of [ Vaso ] HealthCare IT, now Nano-X Health IT, a health care IT provider serving hospitals and health care systems across the United States with expertise in health care IT implementation. Since completing the acquisition, we have been progressing with integration and alignment while also signing several new customer agreements. We are seeing growth driven by new customers, expansion of existing agreements and the integration of our health IT capabilities and we expect this business to contribute to revenue from day 1. In addition to increasing our footprint in AI, the Health IT platform, enhance our ability to integrate into clinical workflow, expand customer cases [ and ] support cross engagement across our ecosystems. Moreover, the rest of the organization is leveraging the [ LIP ] team's expertise and market presence, particularly as it pertains to lead generation for the U.S. [ Iron ] Nanox.AI and Nanox.ARC. Similar to our regulatory work, clinical validation remains central to our strategy and support our commercial efforts to generating evidence across multiple applications and supporting the use of Nano-X solution. As already mentioned, the Cedars-Sinai Medical Center is joining a trial of Nanox.AI Arc [ clarification ] measurement solution, and we've accomplished much more recently. In an exciting update from our collaboration with MDS wellness, an independent provider of wellness screening programs located in Michigan, we secured our first Institutional Review Board approval for a clinical trial within the U.S. The trial will focus on line cancer screening of high-risk patients and the applicability of Nanox.ARC technology as it relates to patient population of Nano-X MPS. As I stated earlier, we attended the European Conference of Radiology, the ECR, where we were able to present several scientific achievements and I'd like to share some highlights now. Dr. [ Nova Shashin ], ARC's Chief Medical Officer, presented our scientific work on lung cancer screening using the Nanox.ARC in the work with our operations in what was shown that is the majority of patients, the screening outcomes based on the lung [ rug ] category, the standard lung cancer premicalification system was similar when analyzing the CT and digital tomosynthesis. This further strengthens the applicability of the TS as a potential addition to screening activities ramping up globally. Dr. [ At ] Wind firmer, senior medical and clinical adviser presented the proven value of our opportunistic screening for CT image using Nanox.AI and three FDA-cleared algorithm enabling earlier detection of chronic disease. Our latest imaging, in addition, tomosynthesis augmented projection, known as TAP2D was also featured in several scientific posters showing value of TAP2D image and a supplemental image to DTS in lieu of the traditional two extra imaging with no additional dose or acquisition inflicted on the patient. And in addition, at the recently concluded World conference of osteoporosis, Nanox.AI bone solution were featured, including updates from our ADAPT trial conducted across four NHS Trust and led by the University of Oxford as well as initial observation from our collaboration with the Greek Air Force. The data will show once more the clinical and economic benefits of AI-based opportunistic screening for routine city exempts. The validation abstract comparing the accuracy of the CCS 2.2 compared with cardiology expert reader as part of the [ InFO ] trial was expected as the poster at the Society of Cardiovascular Complete Thermotography Annual Scientific Meeting in the coming July. Outside the U.S., we are excited about our recent collaboration with their Medical Center in Israel, which is part of the [ Clalit ] Israel largest health services organization where we have an exciting relationship. The Nanox.ARC has been deployed in the emergency department and will be utilized by orthopedic staff as part of the clinical workflow to help establish the digital tomography as an effective tool with lower dose and more efficient workflow than today's CT-based workflow. This is the first time that Nanox.ARC is installed within an emergency department in a major hospital and represent the confidence our collaboration has a Nano-X solution. I'll now provide an update on our robust OEM relationship. Nano-X continued to advance its technology pipeline with ongoing development of next-generation field demand X-ray sources and tube architecture. Recent progress includes improvement in [ telemeter ] design and fabrication processes aimed to expanding chip lifetime and enhancing performance, development of micro focus and multi-zone emitter configuration for application stated semiconductor inspection and held and continued advancement of the Nano-X MDX, the multisource two [ platform ] enabling new system architecture for 3D imaging. The company is also progressing a multiple OEM collaboration in pilot projects across industrial, semiconductor and security market, supporting the expansion of Nano-X's technology into new applications. We recently received a purchase order from the leading semiconductor equipment manufacturer for the developmental meters, supporting advance inspection applications at the leading edge of next-generation IT technologies. With [ Obi ] National Laboratories, the U.S. government agency, a second round of product life is currently in progress, and in process with preparations underway as required materials become available. In parallel, one global imaging component supplier has agreed to evaluate our micro-focused meter technology and is [ caring ] dedicated test infrastructure to support that work. Another major OEM continues to advance prototype development based on our meter design with validation activities are going. Overall, these engagements reflect continued momentum across multiple development track as we work to validate our technology with established industry partners. Before I move on I'd like to briefly note that despite the current geopolitical situation in the Middle East, we have not experienced any material disruption to our operation and our business continues to operate event. With that, I will turn the call over to Ran to review our financials. Ran, over to you.

Thank you. We reported a GAAP net loss for the fourth quarter of 2025 of $33.4 million, which is the reported period. Compared with a net loss of $14.1 million in the fourth quarter of 2024, which is the comparable period. The increase was largely due to an impairment of long-lived assets in the amount of $17.5 million which was recorded during the reported period as a result of the company's restructuring plan that is intended to better align the company's manufacturing activities. The increase was also due to an increase of $0.7 million in the gross loss increase of $1.1 million in the sales and marketing expenses and increase of $1.4 million in other expenses. Revenue for the reported period was $3.7 million compared to revenue $3.0 million in the comparable period. The increase of $0.7 million increase of 23% in the revenues stands from an increase of $0.3 million in our revenue from the teleradiology services and an increase of $0.4 million in our revenue due to the consolidations of Nano-X Health IT Inc. since the completion of its acquisition on November 19, 2025. Gross loss for the quarter period was $3.6 million on a GAAP basis compared to a gross loss of $2.9 million in the comparable period on a GAAP basis. Non-GAAP gross loss for the reported period was $1.2 million as compared to a gross loss of $0.3 million in the comparable period which represents a gross loss margin of approximately 32% on a non-GAAP basis for the reported period as compared to a gross loss margin of 9% on a non-GAAP basis in the comparable period. Revenue from the teleradiology services for the reported period was $3.1 million compared to revenue of $2.8 million in the comparable period. The company's got to gross profit from the teleradiology services for the reported period was $0.9 million. Gross profit margins of approximately 27% compared to $0.6 million gross profit margin of approximately 21% in the comparable period. Non-GAAP gross profit of the company's teleradiology services for the reported period was $1.5 million gross profit margins of approximately 48% compared to a non-GAAP gross profit of $1.1 million, gross profit margin of approximately 41% in the comparable period. The increase in the company's revenue and gross profit from the teleradiology services was mainly attributable to customer retention, increased rates and increased volume of the company's reading services. During the reported period, the company generated revenue for the sales and deployment of its imaging systems, which amounted $49,000 for the reported period with a gross loss of $2.6 million on a GAAP and non-GAAP basis compared to revenue of $136,000 with a gross loss of $1.5 million on a GAAP and non-GAAP basis in the comparable period. The revenue stems from the deployment of our Nanox.ARC systems and the sales of our OEM services in the U.S. The company's revenue from its AI and software solutions for the reported period was $0.5 million on a GAAP and non-GAAP basis compared to revenue of $0.1 million on a GAAP and non-GAAP basis in the comparable period. Included in the reported period revenue of $0.4 million, which was generated by Nano-X Health IT Inc. since the completion of its acquisitions on November 19, 2025. The company's gross law for its AI and software solutions for the reported period was $1.9 million on a GAAP basis compared to a gross loss of $2.0 million on a GAAP basis in the comparable period. Non-GAAP gross profit of the company's AI and software solutions for the reported period was $0.1 million compared to $6,000 in the comparable period. Research and development expenses net for the reported period were $4.8 million compared to $5.4 million in the comparable period, which represents a decrease of $0.6 million. The decrease was mainly due to a decrease of $0.2 million in share-based compensation, $0.6 million in grants received net and $0.4 million in expenses related to our research and development activities to maintain our current and future products. The decrease was mitigated by an increase of $0.5 million in salaries and wages. Sales and marketing expenses for the reported period are $2.0 million compared to $0.9 million in the comparable period, which represents an increase of $1.1 million, mainly due to an increase of $0.7 million in salaries and wages due to our increased efforts to commercialization of the commercialization of our products in the U.S. market and $0.4 million in sales and marketing activities mainly due to expenses that are related to the RSNA conference, which took place during the fourth quarter of 2025. General and administrative expenses for the reported period was $6.0 million compared to $5.8 million in the comparable period, that the increase of $0.2 million was mainly due to expenses that are related to the acquisitions of Nano-X Health IT Inc. Other expenses net for the reported period were $1.4 million, largely due to the noncash settlement with the shareholder. Recently, we initiated a restructuring plan that is intended to better align our refracturing and overhead cost structure and to support gross profit margin improvement to the company's long-term financial model and the company's strategic priorities. As part of this restructuring plan, the company will shift its manufacturing operations from the company-owned facilities into a fully outsourced model. The plan will reduce structuring and overhead cost by downsizing the restructuring facilities located in the company's fab in South Korea to offer the production to other international manufacturers such as the Swiss chip maker System. The restructuring plan is expected to be largely completed in fiscal year 2026 resulted with the company recording a noncash impairment of long-lived assets of approximately $17.5 billion in fiscal year of 2025, a cost that is related to the impairment of its machinery and equipment of the company's cheap manufacturing line. We continue to evaluate the overall composition of the restructuring-related charges, including potential additional cash components. The remaining restructuring-related costs if any, are expected to be incurred over the course of the implementation of the restructuring plan that estimates of the total charges and the timing thereof are subject to a number of assumptions and uncertainties and actual results may differ materially. Non-GAAP net loss attributable to ordinary shares for the reported period was $11.2 million compared to $10 million in the comparable period. The increase of $1.2 million in the non-GAAP net loss attributable to ordinary shares was mainly due to an increase of $0.9 million in the non-GAAP gross loss and an increase of $1.4 million in the non-GAAP operating expenses. Please refer to the non-GAAP adjustments, which were included in the financial portion of the PR that we have issued today. Turning to our balance sheet. As of December 31, 2025, we had cash, cash equivalents and marketable securities of approximately $60 million compared to $55 5 million as of September 30, 2025. We also had a $3.1 million short-term loan from a bank as of December 31, 2025. We ended the quarter with a property and equipment net of $29.7 million compared to $45.4 million as of December 31, 2024. The decrease was mainly attributable to an impairment of approximately $17.5 million that was recorded in the reported period as a result of the above-mentioned impairment related to the machinery and equipment of the company's Korean fab. We had approximately 69.6 million and 63.8 million shares outstanding as of December 31, 2025 and December 2024, respectively. During the fourth quarter of 2025, the company sold approximately 4.2 million ordinary shares, which generated net proceeds of approximately $15.5 million, net of issuance expenses. With that, I will hand the call back over to Erez.

Thank you, Ran. Before closing, I'd like to address the leadership update. After 5 years with the company, our great Chief Financial Officer, Ran Daniel, decided to step down from his role to explore other opportunities. During his tenure, Ran played an important role in strengthening our financial discipline, supporting our transition to a public company in building the financial and reporting infrastructure needed to support our long-term strategy. We also led successful capital raises that strengthened our balance sheet. In addition to leading our finance organization, Ran also oversaw our Investor Relations activity and worked closely with investors and analysts throughout his tenure. We are grateful for his many contributions and wishing continued success in the future endeavors. One will remain with the company to support a smooth transition period. As we look ahead, we are pleased to announce that Guy Nathanzon will be joining Nano-X as Chief Financial Officer. Guy brings extensive financial leadership experience with the U.S. publicly traded companies including several senior CFO and CEO roles in the med tech companies as well as his deep experience supporting growth, scale and global operations. His background includes capital raising, capital markets, both sell-side and buy-side M&A and global financial operations. Guy also brings deep medical technology leadership experience with senior CFO and COO at multiple medtech companies during periods of commercialization, [ CALA ] and global expansion. Guy also brings medical technology experience, having served interior leadership role during periods of commercialization and expansion. His previous [ Lee ] served as the CFO Scorpio Labs Medical Technology company developing AI-based diagnostic platform and most recently was CFO of Valent Semiconductor and New York Stock Exchange listed company. We are pleased to welcome Guy to the leadership. He will join the company and will assume the role of Chief Financial Officer as of August 1. As we look back to this quarter, and ahead to the rest of 2026, I want to leave you with a few takeaways that underscore the momentum we are [ holding ] at Nano-X. First, our commercial progress in the United States has been good. We have established a strong foundation with various partners expected to place systems over the next 2 to 3 years including significant agreements with our industry's internal imaging integrity, imaging and others. This represents a fundamental shift in how we are poised to scale our business from providing our technology to deploying in a meaningful volume shifting towards a growing CapEx portion, this is what we believe will get us closer to our [ India ] revenues of 2026. Second, our strategic acquisition of [ Veda ] Healthcare IT, now operating as Nano-X Health IT has immediately strengthen our capabilities and revenue base. The recognition we received at RSNA and ER including the newcomer awards at ACR reflect the broader truth. Nano-X recognize as a credible player contributing to conversation around the future standard of care in the medical imaging. That perception shift in translating into deeper market engagement and robust supply. The foundation we have built positions us well to convert our pipeline into revenues and deliver on our growth objectives. We are excited about what lies ahead and remain committed to executing on our vision of demarketizing medical imaging globally. Thank you all for your continued support, and we look forward to updating you on our progress in the quarters ahead. Operators, please open the call for questions.

[Operator Instructions] And the first question comes from Jeffrey Cohen with Ladenburg Waman & Company.

Just a couple of questions to [ diving ] a little further. So could you talk a little bit about your footprint and commercial organization, mainly related in the U.S. as far as teams that are direct sales organizations and talk a little bit about how that works with your distribution channels in the U.S.

Okay. So we have in the U.S., what we call Nano-X impact. We have five direct salespeople with the director of the national sales that is coming from our biggest distributors in the country with a lot of experience. In addition, we have which we call the clinical education specialists where their role and assignment is to go to the places that we have the systems installed, trade the [ people ], trying to get a better understanding of the referring physician who works with this site. So their job is to build awareness around the site and what's the clinical value that can be added or other referring physicians that we'll do there. We are -- we have a few organization and operational responsibilities, including tech people who are doing the part of the installations. And in addition, we are -- we have people who are doing the STR like building the deal flow. We are in the process of adding another two people who would be responsible for the channel management. But right now, since we have almost 10 business partners, one of them has mentioned today, is huge. This will require a lot of coordination, a lot of support. We have an onboarding processes for each one of them, which is very methodological that we do in the process to -- when we sign an agreement, the trading process, the unit, for example, we have a few of the business partners in the [ late ] time. We have tens of [ billings ] that already were arranged with the potential customers in order to expand into from field where they are [ committed ] to in the agreement.

Okay. Got it. And then as a follow-up, could you talk a little bit about the South Korean facility and the impairment, what should we expect for 2026, you anticipate further restructuring and impairment? And will that be in the front half year versus the back half of the year? And could you estimate for us if there will be cash and noncash?

Besides the impairment expenses we recorded in 2025, which was the impairment of mainly whatever is related to the chip line in [ the ] fab which was amounted to $17.5 million in the noncash expense, we do anticipate relatively minor expenses which are related to more efficiency that we're going to enact. It won't be -- we don't anticipate that will be a significant amount of dollar. So that's actually going probably to be a cash expense. But as I said, it's not going to be material.

Bear in mind that this fab was built during COVID when semiconductors were not necessarily available. So right now, we are rationalizing the situation where we have a sustainable supplier with a much lower cost of being chips that we do. The Southern Korea go, we converted to more of R&D center for the ceramic teams that we are developing there and might be even another product which is going to come out from this region.

[Operator Instructions] And our next question will come from Scott Henry with AGP.

Thank you, and good morning or afternoon, depending on your location. First, Ran, it was a pleasure working with you. I wish you the best in your future endeavors.

But don't give me. I have another one earnings call.

Excellent. And then, I guess, the first question. When we look at the guidance for 2026, the $35 million which is strong growth. Can you talk about the cadence throughout the year, Q1 is over. So when will we see that inflection point to reach those impressive number?

I think that you will see most of the -- in the second half -- towards the second half of 2026, I don't think that they should expect a big ramp in the revenue in Q1. But I think once we will be able to materialize all the opportunities in terms of distribution agreements that we just announced, you will see. You may see a ramp-up in the second half of 2026.

Scott, most of the agreements were signed beginning of about a month or 2 after the RSNA and part of them also after the ECR. And most of them -- most of the business partners agreements, which are going to shift our revenues to be more coming from more from CapEx rather than only the stuff has been signed in the last few weeks, let's say, a month. So right now, we say we will do -- we will start the onboarding the process and the ramp-up will be, hopefully, its financial towards, as Ran said, towards the second part of the year.

Okay. I appreciate that color. And just from a modeling perspective, the teleradiology services, which at this point is still your largest revenue driver. For 2026, should we be thinking about kind of low double-digit growth? Is it still on that trajectory?

I don't think that we refer to the [indiscernible] in our guidance. So I don't want to make any specific attribution to any specific line of visits or segments. But [ general ] saying I think that your assumption not far from real [indiscernible] from real.

And then when we look at spending for Q4 removing the onetime items, it was a little elevated from Q3 with the restructuring, do you -- would you think that it should start declining from Q4 levels going forward? How should we think about those trends in spending?

Well, what happened in the -- you mean, if you look at the non-GAAP, of course, which adds on the impairment expenses and the expense -- the other expenses, that's mainly related to the settlement with the shareholder, you've seen an increase in G&A, which is, I would call it a seasonal increase mainly because of audit and all kind of other year-end items and expenses that were related to the acquisition of [ Base ] Healthcare, which is onetime in nature. On the other hand, you also see an increase in the sales and marketing, which are -- some of it is related to the [ ization ] oil efforts in the U.S. market. So that's actually something that is not onetime item in nature, but on the other, and if we will participate again in our S&A conference that -- that really depends on the questions. We participate in the RSNA in the [ out ] quarter, as you remember, that cost money, unfortunately. But if we participate against then it will be recurring if we won't, we won't.

Thank you. And this does conclude today's conference call. Thank you for your participation, and you may now disconnect.