Q2 2026 Beyond Air Inc Earnings Call
Speaker #1: A question-and-answer session will follow the formal presentation. And now, I would like to turn the call over to Garth Russell, LifeSide Advisors. Please go ahead.
Speaker #2: Thank you, Operator. Good afternoon, everyone, and thank you for joining us. Today, after market close, we issued a press release announcing the operational highlights and financial results for Beyond Air's second quarter of fiscal year 2026, ended September 30, 2025.
Speaker #2: A copy of this press release can be found on our website, www.beyondair.net, under the News and Events section. Before we begin, I would like to remind everyone that we will be making comments and various plans, and prospects which constitute forward-looking statements remarks about future expectations, for purposes of the Safe Harbor Provisions under the Private Securities Litigation Reform Act of 1995.
Speaker #2: Beyond Air cautions that these forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those indicated. We encourage everyone to review the company's filings with the Securities and Exchange Commission, including without limitation, the company's most recent Form 10-K and Form 10-Q, which identify specific factors that may cause actual results or events to differ materially from those described in the forward-looking statements.
Speaker #2: Additionally, this conference call is being recorded, and will be available for audio rebroadcast on our website, www.beyondair.net. Furthermore, the content of this conference call contains time-sensitive information that is accurate only as of the date of the live broadcast, November 10, 2025.
Speaker #2: Beyond Air undertakes no obligation to revise or update any statements to reflect events or circumstances after the date of this call. With that, I'll turn the call over to Steve Lisi, Chairman and Chief Executive Officer of Beyond Air.
Speaker #2: Steve.
And we had data shown by a physician at the extra Corporal life, support organization conference in September, which show positive results. When lung fit was used in the ECMO sweep gas circuit on neonates.
I would like to provide an update on the data from Beyond Cancer's phase, 1A study as a reminder study enrolled, 10 subjects at doses of 25,000 and 50,000 parts per million nitric oxide, gas delivered. Over 5 minutes into tomorrow early.
These patients all had metastatic disease and were heavily pre-treated. The mean number of total prior surgeries, radiation, and medications was 10.3.
With a minimum of 4 and a maximum of 18.
The mean number of all prior medications, only was 5.5 with a minimum of 2 and a maximum of 14.
All subjects had a life expectancy of less than 12 months when we treated them with unoo therapy.
The only adverse event that occurred in one patient, possibly attributable to nitric oxide, was a grade 3 vasovagal response.
Otherwise, the safety profile is very clean for this patient population.
With respect to overall survival, the median and mean are 22 months and 21.2 months, respectively.
These survival numbers, will continue to increase as we have. Not yet reached the final median survival,
Even these impressive data we are assessing the best path forward for the program at this time.
We remain dedicated to pursuing the phase 1B combination study with anti pd1 therapy and we will communicate more details as we progress.
The neurons team is working closely with Regulators, investigators patient groups, and Foundations, to accelerate development of ba 101 towards a first in human study.
Promise of lung fit is a parent and we are thankful to the team at Street of taking the time to appreciate our vision.
Provide clinicians and patients around the world, with the optimal no system.
Now, we'll turn it over to our CFO Doug Larson.
We showed 3% growth versus last quarter. Deep mentioned how our revenue is a little chunkier. Now given an international ramp is never straight up.
Improvement was primarily attributed to sales growth.
Our margins slipped back to negative this quarter due to costs required to upgrade our existing fleet of devices.
And Provisions for excess inventory.
Turning to operating expenses, we continue to see cost reduction across the board and sgna R&D. And in our supply chain due to cost reduction initiatives, we took in the last 12 months.
This translates to a 37% reduction year over year.
And greater than 56% reduction from a high of 17 million at its peak.
Going forward, we anticipate R&D expenses will decrease slightly next quarter. As the costs related to our Gen 2 device are mostly behind us.
SG&A expenses will only move up in line with our commercial performance to maintain our excellence in service and take advantage of coming opportunities.
Did last year.
Half of the decrease of 2.1 million was due to a reduction in development costs for our Gen 2 device. While the other half was mostly attributed to a decrease in salaries and stock-based compensation costs
Sgna expenses for the quarters and September 30th, 2025 and September 30th. 2024 were 4.9 million and 7.2 million respectively.
Almost all of the decrease of 2.3 million was from a reduction in salaries and stock based compensation costs.
Only part of the business that saw an increase in SG&A was a neuron NOS, as they started to build a little bit of infrastructure to support the groundbreaking work being done there.
Other expense was 0.6 million compared to a 1.2 million expense for the same period a year ago.
The decrease in expense of $0.6 million was primarily attributed to
the prior period loss associated with the partial extinguishment of debt.
Net loss attributed to Common stockholders of Beyond air, Inc was 7.9 million or a loss of 1.25 per share, basic and diluted.
Our net loss for the fiscal quarter and in September 30th, 2024 was 13.4 million or a loss of 5.67 cents. Per share, basically,
please note that the per share results for both periods were calculated to reflect the company's 1 for 20 reverse stock split, which became effective on July 14th, 2025
Net cash burn for the quarter was 4.7 million, which is a 66% reduction versus a year ago.
We believe our overall cash burn will continue to reduce as revenue grows and will only get better until we get approval and start building inventory in preparation for the launch of Gen 2.
As of September 30, 2025, we reported cash, cash equivalents, and marketable securities of $10.7 million.
By Steve mentioned earlier Sub sub subsequent to the end of the second quarter. We announced closing a strategic Financial agreement with streeterville capital LLC under. The terms of the agreement, we issued 12 million promary note, bearing, a 15% annual interest rate.
This note matures in 24 months from the issue date with no payments due for the first 12 months.
In addition, we entered into a 20 million equity line of credit agreement, with streeterville capital dependent on our filing and S1 resale registration. Covering resale of the shares. Streeterville Capital may receive under the ELO
Is Elo provides us with the right, but not the obligation to sell up to million dollars of newly issued shares of our common stock over a 24-month period subject to certain limitations.
Following these recent financing agreements, we believe there are cash and existing Financial. Vehicles will be sufficient to allow us to support our current operating plans, well, into calendar 2027 and potentially to profitability. Providing, we continue to hit our current Revenue. Estimates continue to control costs at Beyond are
With that, I'll hand the call back to Steve.
Thanks Todd.
Operator will take questions.
Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2. If you would like to remove your question from the queue.
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1 moment, please, while we pull for questions.
The first question is from Justin Walsh from Jones Trading. Please go ahead.
Hi, thanks for taking the questions, um, without going into specific fiscal 2027 guidance. Uh, can you comment on the expected growth drivers leaving into the, uh, potential approval of the the second generation lung, fit pH? And then how you're thinking about that trajectory after that second gen product is out?
Thanks Justin. Appreciate that.
so,
obviously, the trajectory wants the second generation is out should be significantly steeper than what we're seeing now. Um, that that's our belief and uh, you know, I think people know the, the attributes of that system versus the current system and the competition. So we're confident in that.
Um, as for the growth drivers, prior to that, I assume you're asking for, um, yes, you know, we're yeah, we're setting up. You know, internationally, we we we're in 35 countries now with Partners, uh, we did just
Um, Place systems in our first commercial Hospital outside the United States. So takes time to build that. Um,
Of of seeds planted out there. I guess you could say and we anticipate that with fiscal 27 coming up, we should be winning a lot of, um, hospitals outside the United States. Um, where the competition is a little bit different than it is in the United States.
um so that's 1 of the drivers for for 27, the other thing inside the United States, you know, we did
We did introduce a capital purchase model. Our system is now.
To a point where it's extremely reliable. Um,
we've had interest and we've actually had our first hospital purchase from us. Um, so that would be a capital equipment purchase and then the filter and the other accessories would be, uh, the ongoing, uh, purchase and those prices. I guess, it depends on how much nitric oxide use in your hospital, um, per year per system, but this is certainly, uh, very competitive from a per hour cost basis for nitric oxide. So I think this new, um, offering, uh, in terms of how hospitals can pay in the United States, we've gotten some interest there and the and the xus will be The Driver um prior to Gen 2, being approved.
Got it and uh, 1 more question. Um, you mentioned here that that you're hoping to commercialize, the the second gen lung fit pH around end of calendar 2026, if I heard correctly, uh, I'm just wondering if you can comment on kind of the thinking around this timing and whether or not you've noticed any delays in your dealings with the FDA recently
Yeah, I think the FDA is doing a great job. I don't think, uh, the timing...
that we're providing is, is uh,
Is FDA being the limiting factor. It's it's more supply chain on our side. Um, I think the environment is difficult to get the parts that we need. Um, so it doesn't help with all the
the uh,
Disagreements. I would say that are happening around the world with trade, um, government shutdown, doesn't help either. So, I think, just getting things in, in place for our ability to get our contract manufacturer in shape, for for inspections is what we're doing. So, it's just a matter of time before that occurs. And I did mention, I mean, you did mention we'd be launching before the end of the year, I think approval has to be a little bit earlier than December obviously. Um, for us to be able to launch by then we're not going to launch the next day. It's going to take a little bit of time, so,
Um, that's kind of where we are right now. Things can change, things can be
Better or worse in terms of timing. But as we sit here today, that's the feeling that we have.
Got it. Thanks for taking the questions.
The next question is from Yale, Jen from Lila & Company. Please go ahead.
Good afternoon, and thanks for taking the questions. Uh, Steve, could you just, uh, do some comparison between the new model versus the prior one? So, give us a little bit more deep dive in terms of the benefits, uh, to the company, uh, maybe to the market penetration. I didn't have a follow.
Up. Yeah, thanks. Yo. I mean, the the the biggest uh difference was a few but the biggest difference is or the size. So this second generation machine will be about 60% the size of the original. Um,
It will be or we've applied for. And I, I believe, we believe that upon approval with approval from FDA, it would be approved for use in ground and air transportation. Um that's that's critical. I think that's probably the biggest Difference Maker for us.
Um, and the user.
the user interface has been upgraded, um,
Based on feedback from our current customers and some.
future customers, I guess, who aren't using our gen 1 System, but did give us advice on Gen 2
Um, so we listened to them, and we built this device based on their input. So we think that all of the functions of the device will be...
a little bit easier and a little bit better for the user. Um, 1 other thing that we have is that the
Maintenance intervals will be longer so that the disruption of swapping machines out for those high-volume users will be, will be, uh,
A thing of the past. Let's say, um,
So when you have hospitals that are using, you know,
An exceptional amount of hours persistent per year. Let's say way above what the average is, you know, we're bringing them in for maintenance fairly regularly. So that's a little bit of a disruption at the hospital and where we're working to get Gen 2 out there, so that disappears
I'm sorry. Try to get a little bit about the TD, new business model. What new business model can achieve that wasn't really fully appreciated but can be appreciated by the existing one?
Um you mean Gen 2 versus gen 1? Yeah.
Uh, I mean, I'm vers. I mean, you mentioned that the new business model, which is, is the purchase. Oh yeah, machine. So I just want to get a sense of what the what does that, what's the benefits of that versus? Uh, the, the the the business business operation, you have done, you know, before this and, uh, what the so additional benefits you can generate from that.
Yeah, so look, the market was set up as essentially a leasing market, um, before we entered the market. So we're, you know, we came in and we, you know, worked with hospitals based on what they were used to and we got requests from hospitals. Can we purchase the machine? Can we purchase the machine? Um, and we weren't.
doing a purchase of the machine in the first, you know, 2 years because we were still making upgrades and tweaking the machine and it would have been difficult to sell something where you were still upgrading and improving it. We're at the point now where there really aren't any more improvements to the Gen 1 machine. Um, you know, a little tweak here or there is is standard, maybe a software update or something. Those things are not
Major changes so, um, for hospitals that have been asking us, if we, they could purchase again. I, I don't know, on their side, you know, they, they prefer to purchase and, and to buy the disposables at a much lower rate than the leasing model would have, um, again that's just their preference. So we are offering different models for using our system to the hospitals based on their needs. That's all it is. Yeah, we we're not abandoning the leasing model or um in any way. So we we have multiple um different types of leases. So we're really just trying to offer the hospitals what they're asking for. So the latest 1 is the capital purchase model, so we introduced it a few months ago and we've got hospitals, that are that are, um, taking advantage of it.
Okay, great, maybe you just follow up on the question. On the next question is that uh you got a lot of uh International audience sign which is a great things to happen? And because of the
A massive market over there. Uh, I assume most of these are distributors.
Uh, uh, distributors. So, uh, how should we think about modeling, uh, over the long term in terms of what sort of pricing that may generate versus the one in the United States, which is slightly different, and how was the filter?
Uh, yeah, renewing filter, you know, filling to that model as well and the things.
yeah, I mean
Actress model for us, you know, where we're selling things to the distributors and then they're using it in whatever model they like in their markets, whether it be a leasing model or a capital equipment purchase model or something else, um, or some combination of that—that's their business. So for us, though, you know, they're purchasing the machines like a capital equipment purchase and then, you know, we're also selling them the disposables, including the filter, which is obviously the most important disposable. So,
Um, I, I, that's how you should think about it. In terms of modeling, it's more of a...
um,
You know, just a repetitive revenue line. And I think that that's probably going to happen more in fiscal 2027 than now because we're just getting the systems out there. Once they're placed in hospitals, you see that repeat business, but that's not happening in fiscal 2026. It'll be a fiscal 2027 phenomenon, picking up speed more in fiscal 2028, because we're still waiting for regulatory approvals in many countries, and it takes time to get into these hospitals. So it is a long process, but.
It's the way it goes.
Okay, great. That's very helpful. And congrats on the, you know, fortifying the balance sheets, which you can do a lot of good things with. And congrats!
Thanks, why?
The next question is from Marie. Thibault from btig. Please go ahead.
Um and then any any thoughts on uh Cadence for the back half of the year?
Thanks Sam, appreciate it. Well, look, you know, we we we've got
3.6 million in the first half. So it's it's not a
large leap to get to the 8 plus, uh, range. But, um,
You know, we we have a, a, a transition at Chief commercial officer, so I I I'm sure everyone on the call wouldn't expect, you know, Bob Goodman to hit the ground running on and Week 1 or 2 and start ripping sales straight up. I think it'll, it'll take a little bit of time for Bob to implement, you know, his
processes here and get things moving in the right direction. So I think that, you know, when there's a change like this, there's going to be a little bit of disruption. So that's, uh,
Part of the reason why the 8 to 10 million is the new guidance.
Okay. Okay, that's helpful. Um, and then maybe I can just follow up here on, um, the, the pace of contract renewals, um, that are coming up. Are you seeing pretty strong, renewal rates are are customers. Um, exiting contracts at all, would would just love, uh, an update there as well? Thanks,
Yeah, the renewals are going well. We've had a bunch of renewals go from 1 year; they renewed for 3 years. We see that.
Happening, not with every contract, but a good number of them.
um,
and I think that, you know, getting on Premiere is very helpful. Um, we had a few hospitals that, um,
Or Premier hospitals. That that
You know we we we had contracts with weren't yet on Premiere so now being on Premier solidifies that, that's very helpful. Um we look forward to hopefully getting on Health Trust as well.
Not only get hospitals, but maintain them, sometimes they can contract out of there.
Out outside of their GPO which is rare, but when we do, when we get on the go, it's obviously important. So we haven't really seen hospitals leaving us. Um,
it's it's a very sticky business I think and I think it's due to the team in the field the machines performance and and my
Really helpful. Thanks for taking the question, Steve.
At this time, we are showing no further questions in the queue and this concludes our question and answer session. I would now like to turn the call back over to Steve Lucy for any closing remarks.
Thanks operator. Thanks everyone for joining. Um look forward to speaking to you in the near future. Thank you.
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