The following discussion and analysis of our financial condition and results of operations, as well as other sections in this Quarterly Report on Form 10-Q, should be read in conjunction with our unaudited interim consolidated financial statements and related notes thereto included elsewhere herein. In addition to historical financial information, some of the information contained in the following discussion and analysis contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical facts, including statements regarding our future results of operations and financial position, business strategy, current and prospective products, product approvals, research and development costs, current and prospective collaborations, timing and likelihood of success, plans and objectives of management for future operations and future results of current and anticipated products, are forward-looking statements. These statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.
In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “would,” “should,” “expect,” “plan,” “design,” “anticipate,” “could,” “intend,” “target,” “project,” “contemplate,” “believe,” “estimate,” “predict,” “potential,” “outlook” or “continue” or the negative of these terms or other similar expressions. The forward-looking statements in this Quarterly Report on Form 10-Q are only predictions. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations. These forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q and are subject to a number of risks, uncertainties and assumptions described under the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K filed with the SEC on March 17, 2026. These risks and uncertainties include, without limitation, risks and uncertainties related to: the effect of the transaction with Greenbrook on our business relationships; operating results and business generally; our ability to execute our business strategy; our ability to achieve or sustain profitable operations due to our history of losses; our reliance on the sale and usage of the System to generate revenues; the scale and efficacy of our salesforce; our ability to retain talent; availability of coverage and reimbursement from third-party payors for treatments using our products; physician and patient demand for treatments using our products; developments in respect of competing technologies and therapies for the indications that our products treat; product defects; our ability to obtain and maintain intellectual property protection for our technology; developments in clinical trials or regulatory review of the System for additional indications; developments in regulation in the U.S. and other applicable jurisdictions; potential effects of evolving and/or extensive government regulation; the terms of our credit facility; and our self-sustainability;existing cash balances; our ability to achieve positive cash flows; and our ability to continue as a going concern. The events and circumstances reflected in our forward-looking statements may not be achieved or occur and actual results could differ materially from those projected in the forward-looking statements. The Company cautions investors not to place undue reliance on these forward-looking statements. Moreover, we operate in an evolving environment. New risk factors and uncertainties may emerge from time to time, and it is not possible for us to predict all risk factors and uncertainties. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements contained in this Quarterly Report on Form 10-Q as a result of any new information, future events or changed circumstances or otherwise.
Overview
We believe that mental health is as important as physical health. The Company’s first commercial product, the System, is a non-invasive and non-systemic office-based treatment that uses TMS to create a pulsed, MRI-strength magnetic field that induces electrical currents designed to stimulate specific areas of the brain associated with mood. The System is cleared by the FDA to treat adult patients with MDD who have failed to achieve satisfactory improvement from prior antidepressant medication in the current MDD episode. It is also cleared by the FDA as an adjunct for adults with OCD and for adolescent patients aged 15-21 with MDD. It is
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also cleared by the FDA to decrease anxiety symptoms in adult patients with MDD that may exhibit comorbid anxiety symptoms (anxious depression). In addition to selling the System and associated treatment sessions to customers, the Company operates Greenbrook Treatment Centers across the U.S., offering TMS therapy using the Systems. The Company acquired Greenbrook, a provider of mental healthcare services, pursuant to the Arrangement. The System is safe, clinically effective, reproducible and precise, and the Company believes it is supported by the largest clinical data set of any competing TMS system. Treatment Centers also acquire SPRAVATO® to treat adults with treatment-resistant depression or depressive symptoms in adults suffering from MDD with acute suicidal ideation or behavior.
Effective as of December 9, 2024, Neuronetics and Greenbrook completed the Arrangement. Each share of Greenbrook common stock outstanding immediately prior to the effective time of the Arrangement was exchanged for shares of Neuronetics common stock at a specified exchange ratio upon closing of the Arrangement. We continue to operate as Neuronetics, Inc., and the Company’s shares trade on the NASDAQ Global Market under the ticker “STIM.”
We designed the System as a non-invasive therapeutic alternative to treat patients who suffer from MDD and to address many of the key limitations of existing treatment options. Additionally, through our acquisition of Greenbrook, we now derive revenue directly from our Treatment Centers, by providing TMS therapy and SPRAVATO® for MDD and other mental health disorders. We derive the majority of our revenues from Greenbrook revenue,treatment session sales, and sales of the System.
We currently operate in two segments: NeuroStar, formerly known as medical device and Greenbrook, formerly known as clinic services. We generate revenues from clinic operations, initial capital sales of our systems, sales of our recurring treatment sessions, service and repair, clinic collaboration services and extended warranty contracts.
For the three months ended June 30, 2026, our Greenbrook revenue and our NeuroStar revenue represented 65% and 35% of our revenues, respectively. For the six months ended June 30, 2026, Greenbrook revenue and our NeuroStar revenue represented 64%and 36% of our revenues, respectively.
Greenbrook revenue consists of revenue attributable to the performance of treatments to patients in the U.S. In circumstances where the net patient fees have not yet been received, the amount of revenue recognized is estimated based on an expected value approach. Due to the nature of the industry and complexity of our Greenbrook revenue arrangements, where price lists are subject to the discretion of payors, variable consideration exists that may result in price concessions and constraints to the transaction price for the services rendered.
Greenbrook revenue reimbursements are derived from third-party payors including federal and state agencies (under the federal healthcare programs), managed care health plans and commercial insurance companies.
We currently sell the System and recurring treatment sessions in the U.S. through our sales and customer support team. Our sales force targets an estimated 53,000 psychiatrists across 26,000 practices. We expect to continue to expand our direct sales and customer support team to further penetrate the market by demonstrating the benefits of the System to providers and their patients. Some of our customers have purchased or may purchase more than one of the Systems. Based on our commercial data, we believe many providers can recoup their initial capital investment in a System by providing a standard course of treatment to approximately 12 patients. We believe psychiatrists can generate approximately $9,000 of average revenue per patient for a standard course of treatment, which may provide meaningful incremental income to their practices. We serve a diverse customer base. In the U.S., providers are reimbursed by federal healthcare programs, as well as the vast majority of commercial payors, for treatment sessions utilizing our System.
Our research and development efforts are primarily focused on hardware and software product developments and enhancements of the System and clinical development relating to additional indications. We outsource the manufacture of components of the Systems that are produced to our specifications, and individual
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components are either shipped directly from our third-party contract manufacturers to our customers or consolidated into pallets at our Malvern, Pennsylvania facility prior to shipment. Final installation of these systems occurs at the customer site.
Total revenues increased by $3.5 million, or 9%, from $38.1 million for the three months ended June 30, 2025 to $41.6 million for the three months ended June 30, 2026 and increased by $5.9 million, or 8%, from $70.1 million for the six months ended June 30, 2025 to $76.0 million for the six months ended June 30, 2026. The increase was primarily attributable to an increase in Greenbrook revenue. We incurred net losses of $3.5 million and $14.2 million for the three and six months ended June 30, 2026, respectively compared to net losses of $9.8 million and $22.5 million for three and six months ended June 30, 2025, respectively. As of June 30, 2026, we had an accumulated deficit of $473.2 million.
Global Economic Conditions
We are continuing to closely monitor macroeconomic impacts, including but not limited to developments affecting financial institutions, supply chains, unemployment rates, investment values, consumer confidence, inflationary and potential recessionary pressures, on our business, results of operations and financial results, which could adversely affect us.
Components of Our Results of Operations
Revenues
We have generated revenues primarily from the sale of the Systems and related sales and rentals of the System, clinic revenue and the recurring revenues from our sale of treatment sessions in the U.S.
Greenbrook Revenues. Greenbrook revenue, formerly known as service or clinic revenue, consisting of TMS services, SPRAVATO® sales and other mental wellness services is determined based on net patient fees, which includes estimates for contractual allowances and discounts. Net patient fees are estimated using an expected value approach where management considers such variables as the average of previous net patient fees received by the applicable payor and fees received by other patients for similar services and the Company’s best estimate leveraging industry knowledge and expectations of third-party payors’ fee schedules. We expect clinic revenue to increase in 2026.
NeuroStar Revenues. NeuroStar revenue, formerly known as products and other revenue, consists of System revenues,treatment session revenues, and other revenues.
System Revenues. System revenues consist primarily of sales or rentals of a capital component, including equipment upgrades to the initial sale of the System. The Systems can be purchased outright or on a sales type lease basis by certain customers. Additionally, Systems may be sold as unlocked Systems, which do not require the customer to purchase treatment sessions for the life of the System.
Treatment Session Revenues. Treatment session revenues primarily include sales of treatment sessions and SenStar treatment links. The treatment sessions are access codes that are delivered electronically in the U.S. The SenStar treatment links are disposable units containing single-use access codes that are sold and used outside the U.S. Access codes are purchased separately by our customers, primarily on an as-needed basis, and are required by the System in order to deliver treatment sessions.
Other Revenues. Other revenues are derived primarily from service and repair, research collaboration agreements and extended warranty contracts with our existing customers.
Refer to the section titled “Critical Accounting Policies and Use of Estimates—Revenue Recognition” in our Annual Report on Form 10-K filed with the SEC on March 17, 2026. Also, refer to “Summary of Significant Accounting Policies” in Notes to Interim Consolidated Financial Statements located in Part I – FINANCIAL INFORMATION, Item 1. Financial Statements.
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Cost of Revenues and Gross Margin
Cost of revenues consists of the costs of components and products purchased from our third-party contract manufacturers of the Systems. We use third-party contract manufacturing partners to produce the components for and assemble the Systems. Cost of revenues also includes costs related to personnel, warranty, shipping, amortization of capitalized software and our operations and field service departments. Our clinic costs primarily include direct center and patient care/treatment costs, regional employee compensation and depreciation. We expect our cost of revenues to increase mainly for Greenbrook, as our product mix changes.
Our gross profit is calculated by subtracting our cost of revenues from our revenues. We calculate our gross margin as our gross profit divided by our revenues. Our gross margin has been and will continue to be affected by a variety of factors, primarily product sales mix, pricing and third-party contract manufacturing costs. Our gross margins on revenues from sales of the Systems and Greenbrook revenue are lower than our gross margins on revenues from sales of treatment sessions and sale of unlocked systems. As a result, the sales mix between the Systems, Greenbrook revenues and treatment sessions can affect the gross margin in any reporting period.
Sales and Marketing Expenses
Sales and marketing expenses consist of commercial activities related to the sale of the Systems and clinic services and personnel costs including salaries and related benefits, sales commissions and share-based compensation for employees focused on these efforts. Other significant sales and marketing costs include conferences and trade shows, promotional and marketing activities, including direct and online marketing and practice support programs.
We anticipate that our sales and marketing expenses will decrease in 2026 relative to 2025 as a result of the cost efficiencies realized post-acquisition across the sales and marketing divisions.
General and Administrative Expenses
General and administrative expenses consist primarily of personnel expenses, including salaries and related benefits, share-based compensation and travel expenses, for employees in executive, finance, clinic support, information technology, legal and human resource functions. General and administrative expenses also include insurance, outside legal fees, accounting and other consulting services, audit fees from our independent registered public accounting firm, Board fees and other administrative costs, such as corporate facility costs, including rent, utilities, depreciation and maintenance not otherwise included in cost of revenues.
We anticipate that our general and administrative expenses will decrease during 2026 compared to 2025 expenses.
Research and Development Expenses
Research and development expenses consist primarily of personnel expenses, including salaries and related benefits and share-based compensation for employees in clinical development, product development, regulatory and quality assurance functions, as well as expenses associated with outsourced professional scientific development services and costs of investigative sites and consultants that conduct our preclinical and clinical development programs. We typically use our employee, consultant and infrastructure resources across our research and development programs.
We expect our research and development expenses to decrease during 2026 compared to 2025 expenses.
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Interest Expense
Interest expense consists of cash interest payable under our credit facility and the amortization of deferred financing costs related to our indebtedness.
Other Income, Net
Other income, net, consists primarily of interest income earned on our money market account balances and notes receivable and ERC payments.
Loss on extinguishment of debt
Loss on debt extinguishment consists of prepayment penalties and impairment of deferred financing costs associated with the extinguishment of debt, as well as fees incurred with third parties in connection with debt extinguishment.
Results of Operations
Comparison of the three months ended June 30, 2026 and 2025
Three Months Ended
June 30, Increase / (Decrease)
2026 2025 Dollars Percentage
(in thousands, except percentages)
Revenues $ 41,568 $ 38,108 $ 3,460 9 %
Cost of revenues 20,345 20,350 (5) (0) %
Gross Profit 21,223 17,758 3,465 20 %
Gross Margin 51.1 % 46.6 %
Operating expenses:
Sales and marketing 9,984 11,868 (1,884) (16) %
General and administrative 11,404 12,150 (746) (6) %
Research and development 1,336 1,798 (462) (26) %
Total operating expenses 22,724 25,816 (3,092) (12) %
Loss from Operations (1,501) (8,058) 6,557 81 %
Other (income) expense:
Interest expense 2,125 1,969 156 8 %
Other income, net (162) (188) 26 (14) %
Net Loss $ (3,464) $ (9,839) $ 6,375 65 %
Revenues by Segment
Three Months Ended June 30,
2026 2025
% of % of
Amount Revenues Amount Revenues
(in thousands, except percentages)
NeuroStar revenue $ 14,677 35 % $ 15,084 40 %
Greenbrook revenue 26,891 65 % 23,024 60 %
Total revenues $ 41,568 100 % $ 38,108 100 %
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Revenues
Total revenue for the three months ended June 30, 2026 was $41.6 million, an increase of $3.5 million, or 9%, compared to the three months ended June 30, 2025 revenue of $38.1 million.
The increase in revenue was primarily driven by higher Greenbrook revenue, which increased $3.9 million, or 17%, to $26.9 million in the second quarter of 2026 from $23.0 million in the second quarter of 2025, reflecting continued contributions from clinics acquired in connection with the Greenbrook transaction and improved revenue cycle management within our Greenbrook segment. The growth was partially offset by a decline in NeuroStar revenue, which decreased $0.4 million to $14.7 million for the three months ended June 30, 2026 from $15.1 million for the three months ended June 30, 2025.
Cost of Revenues and Gross Margin
Cost of revenues remained relatively consistent at $20.3 million for the three months ended June 30, 2026, compared to $20.4 million for the three months ended June 30, 2025. Gross margin increased from 46.6% for the three months ended June 30, 2025 to 51.1% for the three months ended June 30, 2026. The increase in gross margin was primarily due to sales of unlocked capital systems, which carry a higher average selling price, as well as improved revenue cycle management within the Greenbrook clinics.
Sales and Marketing Expenses
Sales and marketing expenses decreased by $1.9 million, or 16.0%, from $11.9 million for the three months ended June 30, 2025 to $10.0 million for the three months ended June 30, 2026. The decrease was primarily driven by lower personnel costs and reduced marketing program spend.
General and Administrative Expenses
General and administrative expenses decreased by $0.8 million, or 6%, from $12.2 million for the three months ended June 30, 2025 to $11.4 million for the three months ended June 30, 2026. The decrease was due to a decrease in stock based expense within the general and administrative function.
Research and Development Expenses
Research and development expenses decreased by $0.5 million, or 26%, from $1.8 million for the three months ended June 30, 2025 to $1.3 million for the three months ended June 30, 2026. The decrease in research and development was driven by personnel expense.
Interest Expense
Interest expense increased by $0.1 million, or 8%, from $2.0 million for the three months ended June 30, 2025 to $2.1 million for the three months ended June 30, 2026, primarily due to a higher outstanding debt balance.
Other Income, Net
Other income, net decreased by $0.03 million, or 14%, primarily due to lower interest income earned on the Company's money market accounts and notes receivable.
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Comparison of the six months ended June 30, 2026 and 2025
Six Months Ended
June 30, Increase / (Decrease)
2026 2025 Dollars Percentage
(in thousands, except percentages)
Revenues $ 76,022 $ 70,083 $ 5,939 8 %
Cost of revenues 38,645 36,587 2,058 6 %
Gross Profit 37,377 33,496 3,881 12 %
Gross Margin 49.2 % 47.8 %
Operating expenses:
Sales and marketing 20,721 23,867 (3,146) (13) %
General and administrative 24,452 25,287 (835) (3) %
Research and development 2,700 3,414 (714) (21) %
Total operating expenses 47,873 52,568 (4,695) (9) %
Loss from Operations (10,496) (19,072) 8,576 45 %
Other (income) expense:
Interest expense 4,391 3,891 500 13 %
Loss on extinguishment of debt 539 — 539 100 %
Other income, net (1,182) (435) (747) (172) %
Net loss $ (14,244) $ (22,528) $ 8,284 37 %
Revenues by Segment
Six Months Ended June 30,
2026 2025
% of % of
Amount Revenues Amount Revenues
(in thousands, except percentages)
NeuroStar revenue $ 27,602 36 % $ 28,400 41 %
Greenbrook revenue 48,420 64 % 41,683 59 %
Total revenues $ 76,022 100 % $ 70,083 100 %
Revenues
Total revenue for the six months ended June 30, 2026 was $76.0 million, an increase of 8% compared to the six months ended June 30, 2025 revenue of $70.1 million.
The increase in revenue was primarily driven by higher Greenbrook revenue, which increased $6.7 million, or 16%, to $48.4 million for the six months ended June 30, 2026 from $41.7 million for the six months ended June 30, 2025. The increase in Greenbrook revenue was primarily attributable to contributions from clinics acquired in connection with the Greenbrook transaction, as well as continued growth in clinic operations and improved revenue cycle management within the Greenbrook segment. This growth was partially offset by a decrease in NeuroStar revenue, which declined $0.8 million, or 3%, to $27.6 million for the six months ended June 30, 2026 from $28.4 million for the six months ended June 30, 2025. Greenbrook revenue represented 64% of total revenue for the six months ended June 30, 2026 compared to 59% for the six months ended June 30, 2025, while NeuroStar revenue represented 36% of total revenue compared to 41% in the prior-year period.
Cost of Revenues and Gross Margin
Cost of revenues increased by $2.0 million, or 6%, from $36.6 million for the six months ended June 30, 2025 to $38.6 million for the six months ended June 30, 2026. Gross margin increased from 47.8% for the six months ended June 30, 2025 to 49.2% for the six months ended June 30, 2026. The increase in gross margin
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was primarily due to sales of unlocked capital systems, which carry a higher average selling price, as well as improved revenue cycle management within the Greenbrook clinics.
Sales and Marketing Expenses
Sales and marketing expenses decreased by $3.2 million, or 13%, from $23.9 million for the six months ended June 30, 2025 to $20.7 million for the six months ended June 30, 2026. The decrease was primarily driven by lower personnel costs, reduced marketing program spend, and a favorable bad debt adjustment related to the current expected credit loss reserve.
General and Administrative Expenses
General and administrative expenses decreased by $0.8 million, or 3%, from $25.3 million for the six months ended June 30, 2025 to $24.5 million for the six months ended June 30, 2026. The decrease was due to a decrease in stock based expense within the general and administrative function.
Research and Development Expenses
Research and development expenses decreased by $0.7 million, or 21%, from $3.4 million for the six months ended June 30, 2025 to $2.7 million for the six months ended June 30, 2026. The decrease in research and development was primarily driven by lower personnel expense.
Interest Expense
Interest expense increased by $0.5 million, or 13%, from $3.9 million for the six months ended June 30, 2025 to $4.4 million for the six months ended June 30, 2026, primarily due to a higher outstanding debt balance.
Loss on extinguishment of debt
Loss on extinguishment of debt amounting to $0.5 million was recorded during the six months ended June 30, 2026, related to the Perceptive Facility. This included $0.3 million of early prepayment fees and $0.2 million of deferred financing expense related to extinguishment of debt.
Other Income, Net
Other income, net increased by $0.8 million, or 172%, from $0.4 million for the six months ended June 30, 2025 to $1.2 million for the six months ended June 30, 2026, primarily due to higher interest income earned on the Company's money market accounts, notes receivable and ERC payments.
Liquidity and Capital Resources
Overview
As of June 30, 2026, we had cash and cash equivalents of $19.2 million and an accumulated deficit of $473.2 million, compared to cash and cash equivalents of $28.1 million and an accumulated deficit of $458.8 million as of December 31, 2025. We incurred negative cash flows from operating activities of $10.4 million and $20.5 million for the six months ended June 30, 2026 and 2025, respectively. The Company has incurred operating losses since its inception, and management anticipates that its operating losses will continue in the near term as the Company continues to invest in sales and marketing and product development activities. The Company’s primary sources of capital to date have been from its initial public offering, borrowings under its credit facility, proceeds from its secondary public offerings of common stock (including, without limitation, the ATM Program), and revenues from Greenbrook and NeuroStar. As of June 30, 2026, the Company had $65.0 million of borrowings outstanding under the Perceptive Facility, which has a final maturity on July 25, 2029. The Perceptive Facility is subject to certain financial covenants including a minimum net revenue covenant that escalates over the term of the Perceptive Facility and a minimum liquidity covenant.
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If our cash and cash equivalents and anticipated revenues from Greenbrook and NeuroStar are insufficient to satisfy our liquidity requirements, we may seek to sell additional common or preferred equity or debt securities or enter into a new credit facility or another form of third-party funding or seek other debt financing. If we raise additional funds by issuing equity or equity-linked securities, our stockholders would experience dilution and any new equity securities could have rights, preferences and privileges superior to those of holders of our common stock. Debt financing, if available, may involve covenants restricting our operations or our ability to incur additional debt. We cannot be assured that additional equity, equity-linked or debt financing will be available on terms favorable to us or our stockholders, or at all. It is also possible that we may allocate significant amounts of capital towards products or technologies for which market demand is lower than expected and, as a result, abandon such efforts. If we are unable to maintain our current financing or obtain adequate additional financing when we require it, or if we obtain financing on terms which are not favorable to us, or if we expend capital on products or technologies that are unsuccessful, our ability to continue to support our business growth and to respond to business challenges could be significantly limited, or we may be required to delay the development, commercialization and marketing of our products.
The Company is subject to certain financial covenants under its credit facility, including a liquidity and quarterly trailing twelve-month minimum revenue covenants. On March 12, 2026, the Company amended the terms of its credit agreement to modify the required quarterly revenue covenants through December 31, 2026 and the liquidity covenants through September 30, 2027. As of June 30, 2026 the Company was in compliance with the financial covenants in accordance with this agreement. The Company currently projects trailing twelve-month revenue for the period ended March 31, 2027 to be below the minimum required revenue for that period as stated in the credit facility agreement. Should the Company not be able to meet its March 31, 2027 minimum revenue covenant, the lender may at that time and at its discretion, call the credit facility. Should the lender call the facility, the Company is not projected to have the liquidity required to meet its requirement to pay off the loan. Therefore, substantial doubt exists about the Company’s ability to continue as a going concern.
Actions within the Company's control to meet its minimum revenue covenant include improvements to its revenue cycle management to increase collections, introducing new treatment options at its clinic locations and pursuing new strategies within its NeuroStar business to accelerate sales growth and optimize its product mix. The Company’s ability to meet its liquidity needs, including meeting future revenue and liquidity covenants, is dependent on growth in existing and acquired product and service lines and the realization of synergies related to its acquisition of Greenbrook. However, at this time, these actions do not fully mitigate the risk related to compliance with the revenue covenant for the March 31, 2027 period. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Our current and future funding requirements will depend on many factors, including:
● our ability to achieve revenue growth and improve operating margins;
● compliance with the terms and conditions, including covenants, set forth in our credit facility;
● the cost of expanding our operations and offerings, including our sales and marketing efforts;
● our ability to improve or maintain coverage and reimbursement arrangements with domestic third-party and government payors;
● our rate of progress in establishing coverage and reimbursement arrangements from international commercial third-party and government payors;
● our rate of progress in, and cost of the sales and marketing activities associated with, establishing adoption of our products and maintaining or improving our sales to our current customers;
● the cost of research and development activities, including research and development relating to additional indications of neurohealth disorders;
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● the effect of competing technological and market developments;
● efficiency of our Greenbrook operations; and
● the potential cost of and delays in product development as a result of any regulatory oversight applicable to our products.
As of June 30, 2026, there were no significant changes to our material cash requirements as set forth in our Annual Report on Form 10-K filed with the SEC on March 17, 2026.
Cash Flows
The following table sets forth a summary of our cash flows for the six months ended June 30, 2026 and 2025:
Six Months Ended June 30,
2026 2025
(in thousands)
Net Cash used in Operating activities $ (10,429) $ (20,497)
Net Cash used in Investing activities (589) (471)
Net Cash provided by Financing activities 1,831 18,978
Net decrease in Cash, Cash equivalents and Restricted cash $ (9,187) $ (1,990)
Net Cash used in Operating Activities
Net cash used in operating activities for the six months ended June 30, 2026 was $10.4 million, consisting primarily of a net loss of $14.2 million and an unfavorable change in net operating assets and liabilities of $1.3 million, partially offset by non-cash charges of $5.1 million primarily consisting of depreciation and amortization, loss on disposal of property and equipment, non-cash interest expense, share-based compensation and loss on extinguishment of debt. The increase in net operating assets was primarily due to decreases in accrued expenses, an increase inventory, partially offset by a decrease in accounts receivable and prepaid commission.
Net cash used in operating activities for the six months ended June 30, 2025 was $20.5 million, consisting primarily of a net loss of $22.5 million and an increase in net operating assets of $3.7 million, offset by non-cash charges of $5.7 million primarily consisting of depreciation and amortization and share-based compensation. The increase in net operating assets was primarily due to increases in accounts receivable, and decreases in accounts payable, accrued expenses, prepaid expenses and other assets and prepaid commission expense.
Net Cash used in Investing Activities
Net cash used in investing activities for the six months ended June 30, 2026 was $0.6 million, which was primarily due to purchases of property and equipment and capitalized software costs, partially offset by proceeds from the sale of property and equipment.
Net cash used in investing activities for the six months ended June 30, 2025 was $0.5 million, which was attributable to purchases of property and equipment and capitalized software costs.
Net Cash provided by Financing Activities
Net cash provided by financing activities for the six months ended June 30, 2026 was $1.8 million. This primarily reflected proceeds of $8.0 million from the issuance of common stock under the ATM Program. These inflows were partially offset by the repayment of $5.0 million of long-term debt, repayment of deferred and contingent consideration of $0.3 million, payment of debt extinguishment costs of $0.3 million, payments
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of common stock offering issuance costs under the ATM Program of $0.4 million, debt issuance costs of $0.1 million, and distributions to non-controlling interest holders of $0.2 million.
Net cash provided by financing activities for the six months ended June 30, 2025 was $19.0 million and primarily consisted of net proceeds from our secondary public offering.
Indebtedness
For information regarding the Perceptive Facility, refer to “Debt” in Notes to Interim Consolidated Financial Statements located in Part I – FINANCIAL INFORMATION, Item 1. Financial Statements.
Recent Accounting Pronouncements
Refer to “Summary of Significant Accounting Policies” and “Recent Accounting Pronouncements” in Notes to Interim Consolidated Financial Statements located in Part I – FINANCIAL INFORMATION, Item 1. Financial Statements.