Q2 2026 Lumexa Imaging Holdings Inc Earnings Call

August 12, 2026

Speaker #1: Thank you for standing by, and welcome to the Lumexa Imaging second-quarter 2026 earnings conference call. At this time, all participants are and listen-only mode.

Operator: Thank you for standing by, and welcome to the Lumexa Imaging Q2 2026 earnings conference call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during this session, you will need to press star 11 on your telephone. If your question has been answered and you would like to remove yourself from the queue, simply press star 11 again. As a reminder, today's program is being recorded. Now I would like to introduce your host for today's program, Sue Dooley, Investor Relations. Please go ahead, ma'am.

Speaker #1: After the speaker's presentation, there will be a question-and-answer session. To ask a question during this session, you'll need to press *11 on your telephone.

Speaker #1: If your question has been answered and you'd like to remove yourself from the queue, simply press star 11 again. As a reminder, today's program is being recorded.

Speaker #1: And now, I'd like to introduce your host for today's program, Sue Cooley from Investor Relations. Please go ahead, ma'am.

Speaker #2: Thank you. And hello, everyone. We appreciate you joining us today. Leading today's call are our Chief Executive Officer, Caitlin Zula, and Tony Martin, our Chief Financial Officer.

Sue Dooley: Thank you, and hello, everyone. We appreciate you joining us today. Leading today's call are our Chief Executive Officer, Caitlin Zulla, and Tony Martin, our Chief Financial Officer. Before we begin, I want to note that today's discussion will include forward-looking statements, including statements regarding our 2026 guidance, expected operating performance, growth initiatives, reimbursement assumptions, capital expenditures, and other future events. These statements reflect our current expectations and assumptions, which are subject to risks and uncertainties that could cause actual results to differ materially. Please refer to the forward-looking statements and risk factors described in today's earnings release and our most recent SEC filings for additional information. We undertake no obligation to update these statements. We will also discuss certain non-GAAP financial measures, definitions, and reconciliations to the most directly comparable GAAP measures are included in today's earnings release. With that, I will now turn the call over to Caitlin.

Speaker #2: Before we begin, I want to note that today's discussion will include forward-looking statements, including statements regarding our 2026 guidance, expected operating performance, growth initiatives, reimbursement assumptions, capital expenditures, and other future events.

Speaker #2: These statements reflect our current expectations and assumptions, which are subject to risks and uncertainties that could cause actual results to differ materially. Please refer to the forward-looking statements and risk factors described in today's earnings release and are most recent SEC filings for additional information.

Speaker #2: We undertake no obligation to update these statements. We will also discuss certain non-GAAP financial measures. Definitions and reconciliations to the most directly comparable GAAP measures are included in today's earnings release.

Speaker #2: With that, I will now turn the call over to Caitlin. Caitlin, please go ahead.

Sue Dooley: Caitlin, please go ahead.

Speaker #3: Thanks, Sue. Thank you all for joining us today. Q2 was a quarter of substantial progress as we continued to execute against the strategic priorities which support our ambition to build the premier platform for high-quality, lower-cost outpatient imaging serving health systems, physicians, and patients.

Caitlin Zulla: Thanks, Sue. Thank you all for joining us today. Q2 was a quarter of substantial progress as we continue to execute against the strategic priorities which support our ambition to build the premier platform for high quality, lower cost outpatient imaging serving health systems, physicians, and patients. These include driving strong same center growth with an expanding mix of advanced modalities, new de novo openings, and ensuring the successful ramp of new centers, accelerating high-impact strategic service lines, and expanding our geographic footprint through disciplined capital efficient growth. I am eager to share our progress tonight. A few highlights from the quarter. In Q2, we demonstrated continued strength of our core business. We delivered healthy growth in total same center volumes, sustained momentum in advanced modalities, continued maturation of our de novo cohort, and important progress in expanding our health system partnerships.

Speaker #3: These include driving strong same-center growth with an expanding mix of advanced modalities, new de novo openings, and ensuring the successful ramp of new centers.

Speaker #3: Accelerating high-impact strategic service lines and expanding our geographic footprint through disciplined, capital-efficient growth. I'm eager to share our progress tonight. A few highlights from the quarter.

Speaker #3: In Q2, we demonstrated continued strength in our core business. We delivered healthy growth in total same-center volumes, sustained momentum in advanced modalities, continued maturation of our de novo cohorts, and made important progress in expanding our health system partnerships.

Speaker #3: Advanced modalities grew to 37.4% of total volumes, a record high for our company. And 111 basis points higher than a year ago. Our advanced modality mix shift continues to build, driving higher reimbursement and margin for the business.

Caitlin Zulla: Advanced modalities grew to 37.4% of total volume, a record high for our company, 111 basis points higher than a year ago. Our advanced modality mix shift continues to build, driving higher reimbursement and margin for the business. in May, we announced four new centers so far this year. We have opened two de novos against our ongoing goal of eight to 10 annually. We also completed two acquisitions, including our first site with the UPMC joint venture. As we have previously indicated, the balance of this year's openings will be later in the year, and we remain on track to hit our full year de novo target. in June, we achieved a significant milestone, a joint venture with Hospital for Special Surgery, a globally recognized leader in musculoskeletal health, expanding our presence in the New York City Metro area.

Speaker #3: In May, we announced four new centers so far this year. We've opened two de novos against our ongoing goal of 8 to 10 annually.

Speaker #3: We also completed two acquisitions, including our first site with the UPMC joint venture. And as we've previously indicated, the balance of this year's openings will be later in the year and we remain on track to hit our full year de novo target.

Speaker #3: In June, we achieved a significant milestone: a joint venture with Hospital for Special Surgery, a globally recognized leader in musculoskeletal health, expanding our presence in the New York City metro area.

Speaker #3: And all quarter, we are actively ramping de novo centers and our 2024 and 2025 cohorts are tracking in line with our expectations. Layering in a healthy mix of advanced volumes while meeting meaningful strides towards our objectives around long-term growth and profit expansion.

Caitlin Zulla: All quarter, we are actively ramping de novo centers, and our 2024 and 2025 cohorts are tracking in line with our expectations, layering in a healthy mix of advanced volumes while making meaningful strides towards our objectives around long-term growth and profit expansion. These accomplishments provide us with a strong foundation heading into the H2 of the year. Our performance through Q2, together with the continued progress across our key growth initiatives, supports our continued confidence in our ability to deliver our full year commitments and the updated guidance we are providing tonight. Tony Martin will speak more to this in a moment. We remain inspired by our mission to expand access to high quality and lower cost imaging through elevated, compassionate care. I am proud of the progress our team is making and the energy they bring to their work at Lumexa every day.

Speaker #3: These accomplishments provide us with a strong foundation heading into the second half of the year. Our performance through Q2, together with the continued progress across our key growth initiatives, supports our continued confidence in our ability to deliver our full-year commitments and the updated guidance we're providing tonight.

Speaker #3: Tony will speak more to this in a moment. We remain inspired by our mission to expand access to high-quality and lower-cost imaging through elevated, compassionate care.

Speaker #3: I'm proud of the progress our team is making and the energy they bring to their work at Lumexa every day. In fact, we recently completed our annual employee engagement survey and achieved record scores.

Caitlin Zulla: In fact, we recently completed our annual employee engagement survey and achieved record scores, a reflection of a team that is aligned and energized by our vision to be the partner of choice for leading health systems and radiologists. That spirit of engagement and shared purpose is the foundation from which we continue to grow. It is early days for our market opportunity, and yet our value proposition resonates strongly with patients, providers, health systems, and payers. Whether through our wholly owned or joint venture centers, we are successfully delivering high quality imaging in more convenient settings on a more timely basis and at a meaningfully lower cost than hospital outpatient departments. We help health systems solve important operational challenges and achieve their patient care and market expansion goals. Patients love the care they receive, which is reflected in our Net Promoter Scores that consistently exceed 90.

Speaker #3: Our reflection of a team that is aligned and energized by our vision to be the partner of choice for leading health systems and radiologists.

Speaker #3: That spirit of engagement and shared purpose is the foundation from which we continue to grow. It's early days for our market opportunity, and yet our value proposition resonates strongly with patients, providers, health systems, and payers.

Speaker #3: Whether through our wholly owned or joint venture centers, we are successfully delivering high-quality imaging in more convenient settings on a more timely basis and at a meaningfully lower cost than hospital outpatient departments.

Speaker #3: We help health systems solve important operational challenges and achieve their patient care and market expansion goals. And patients love the care they receive, which is reflected in our net promoter scores that consistently exceed 90.

Speaker #3: In fact, Kaufman Hall just published an article titled "Radiology Strategy Was Never About Radiology," which states, "Imaging is not simply a department. It's a critical infrastructure for health systems' growth in oncology, cardiovascular, neuroscience, and orthopedics." We could not agree more.

Caitlin Zulla: In fact, Kaufman Hall just published an article titled "Radiology Strategy Was Never About Radiology," which states, "Imaging is not simply a department. It is a critical infrastructure for health systems growth in oncology, cardiovascular, neuroscience, and orthopedics." We could not agree more. Our value proposition at Lumexa is bigger than operating imaging centers. We help health systems improve access, retain patients, and improve their bottom line. We view imaging access as the front door to a health system's most valuable service line, and we help health systems own that front door at a lower cost in the right convenient locations for their patients and with an operating model that drives value to all stakeholders. As you know, CMS released its 2027 Hospital Outpatient Prospective Payment System proposed rule in early July. We believe the proposed OPPS rule provides further validation of the direction healthcare is moving.

Speaker #3: Our value proposition at Lumexa is bigger than operating imaging centers. We help health systems improve access, retain patients, and improve their bottom lines. We view imaging access as the front door to a health system's most valuable service line.

Speaker #3: And we help health systems own that front door. At a lower cost. In the right convenient locations for their patients. And with an operating model that drives value to all stakeholders.

Speaker #3: As you know, CMS released its 2027 Hospital Outpatient Prospective Payment System proposed role in early July. We believe the proposed OPPS role provides further validation of the direction health care is moving.

Speaker #3: High-quality imaging should be delivered in the most appropriate cost-effective setting. If finalized as proposed, the site-neutral provisions would reduce the reimbursement advantage associated with hospital outpatient departments and further strengthen the rationale for health systems to expand, lower cost, freestanding imaging capacity.

Caitlin Zulla: High quality imaging should be delivered in the most appropriate, cost-effective setting. If finalized as proposed, the site-neutral provisions would reduce the reimbursement advantage associated with hospital outpatient departments and further strengthen the rationale for health systems to expand lower cost freestanding imaging capacity. Lumexa is built for this environment. Our model enables health systems to improve access, expand strategically, and participate in outpatient imaging growth with a lower cost structure that does not depend on a hospital-based reimbursement premium. While the proposal remains subject to comment and finalization, we view the shift towards outpatient imaging as a structural growth driver that will benefit us across the years, not quarters. In other government matters, we reviewed CMS' 2027 Medicare Physician Fee Schedule proposed rule released in July.

Speaker #3: Lumexa is built for this environment. Our model enables health systems to improve access, expand strategically, and participate in outpatient imaging growth with a lower-cost structure that does not depend on a hospital-based reimbursement premium.

Speaker #3: While the proposal remains subject to comment and finalization, we view the shift towards outpatient imaging as a structural growth driver that will benefit us across the years, not quarters.

Speaker #3: In other government matters, we reviewed CMS's 2027 Medicare Physician Fee Schedule proposed role released in July. As a reminder, this is relevant to our current rate assumptions of approximately flat year-over-year government reimbursement rates and a 1% increase in commercial payer rates.

Caitlin Zulla: As a reminder, this is relevant to our current rate assumptions of approximately flat year-over-year government reimbursement rates and a 1% increase in commercial payer rates. If finalized as proposed, we believe the CMS rule would be consistent with our planning assumption for government payer rates. Medicare Advantage and fee for service stand at around 20% of our revenue. Regarding our commercial payers, the majority of the mix, we're fortunate to have a diverse set of payers who renew across staggered years, and so far this year, commercial negotiations also support our assumptions as we look ahead. At Lumexa, we're addressing a large and growing market opportunity, and the market is moving towards us. We benefit from durable long-term tailwinds that we believe are just taking shape.

Speaker #3: If finalized as proposed, we believe the CMS role would be consistent with our planning assumption for government payer rates. Medicare Advantage and Fee for Service stand at around 20% of our revenue.

Speaker #3: Regarding our commercial payers, the majority of the mix were fortunate to have a diverse set of payers who renew across staggered years and so far this year, commercial negotiations also support our assumptions as we look ahead.

Speaker #3: At Lumexa, we're addressing a large and growing market opportunity, and the market is moving toward us. We benefit from durable, long-term tailwinds that we believe are just taking shape.

Speaker #3: Aging populations with more complex and chronic conditions, new treatment paradigms requiring advanced imaging, rising preventative screening rates, and a sustained shift from hospital-based to outpatient sites of care in a fragmented, capacity-constrained industry.

Caitlin Zulla: Aging populations with more complex and chronic conditions, new treatment paradigms requiring advanced imaging, rising preventative screening rates, and a sustained shift from hospital-based to outpatient sites of care in a fragmented capacity-constrained industry. In a real highlight of Q2, we announced our ninth health system joint venture, a strategic partnership with Hospital for Special Surgery, the world-renowned leader in musculoskeletal health. I would like to speak to this prestigious partnership in a bit more detail, which we think represents a significant validation of our joint venture approach. HSS is ranked number 1 in orthopedics in the US and is recognized globally for clinical excellence. Their decision to partner with Lumexa involved a rigorous evaluation of our clinical quality and operational capabilities. HSS is an exciting amplifier of our vision to build a broad network of imaging centers in some of the nation's most attractive markets.

Speaker #3: In a real highlight of Q2, we announced our ninth Health System Joint Venture, a strategic partnership with Hospital for Special Surgery, the world-renowned leader in musculoskeletal health.

Speaker #3: I would like to speak to this prestigious partnership in a bit more detail, which we think represents a significant validation of our joint venture approach.

Speaker #3: HSS is ranked number one in orthopedics in the US and is recognized globally for clinical excellence. Their decision to partner with Lumexa involved a rigorous evaluation of our clinical quality and operational capabilities.

Speaker #3: HSS is an exciting amplifier of our vision to build a broad network of imaging centers in some of the nation's most attractive markets. Imagine New Yorkers who can visit their specialists in Manhattan and obtain timely and convenient imaging in surrounding communities.

Caitlin Zulla: Imagine New Yorkers who can visit their specialists in Manhattan and obtain timely and convenient imaging in surrounding communities. The New York metro area is one of the largest healthcare markets in the country, and we are excited to serve patients and referring providers in this strategic MSA. We are honored that HSS chose to partner with Lumexa. This partnership is our second new health system collaboration in the last 12 months, following UPMC, and reflects the growing pipeline of health systems actively seeking to expand hospital outpatient imaging access. In fact, our recent market review identified a substantial universe of health systems, close to 100, where our model can address a demonstrated outpatient imaging need, giving us the confidence in the depth and duration of our partnership pipeline. The market in front of us is promising and vast, and our offering is compelling.

Speaker #3: The New York metro area is one of the largest health care markets in the country, and we are excited to serve patients and referring providers in this strategic MSA.

Speaker #3: We are honored that HSS chose to partner with Lumexa. This partnership is our second new health system collaboration in the last 12 months, following UPMC, and reflects the growing pipeline of health systems actively seeking to expand, hospital outpatient imaging access.

Speaker #3: In fact, our recent market review identified a substantial universe of health systems close to 100 where our model can address a demonstrated outpatient imaging need, giving us the confidence and the depth and duration of our partnership pipeline.

Speaker #3: The market in front of us is promising and vast, and our offering is compelling. In addition to the long-term market forces supporting our growth plans, our operations and commercial teams have partnered with clinical leaders to implement important programs to enhance care and drive growth.

Caitlin Zulla: In addition to the long-term market forces supporting our growth plans, our operations and commercial teams have partnered with clinical leaders to implement important programs to enhance care and drive growth. Specifically, our team was busy with programs to drive same-center growth and expand access with discipline and an emphasis on advanced modalities. Here is a little more on that. PET was a particular highlight in Q2, with 23.2% growth. We continue to advance our strategy here, adding two of our three targeted new PET machines in July. We are also expanding into new tracers, unlocking our valuable PET offering for more patients, including the tracer FES fluoroestradiol for estrogen-positive breast cancer patients. On the BAC front, our AI-powered breast arterial calcification program continues to see strong uptake in New York and New Jersey, and we are advancing our expansion plans for other geographies.

Speaker #3: Specifically, our team was busy with programs to drive same-center growth and expand access, with discipline and an emphasis on advanced modalities. Here's a little more on that.

Speaker #3: PET was a particular highlight in Q2, with 23.2% growth. We continue to advance our strategy here, adding two of our three targeted new PET machines in July.

Speaker #3: We are also expanding into new tracers, unlocking our valuable PET offering for more patients, including the tracer FES, fluoroestradiol, for estrogen-positive breast cancer patients.

Speaker #3: On the BAC front, our AI-powered breast arterial calcification program continues to see strong uptake in New York and New Jersey, and we are advancing our expansion plans for other geographies.

Speaker #3: We recently launched our Lung Cancer Screening Initiative. This involves programs to drive patient engagement around one of the most impactful screening opportunities in our patient population.

Caitlin Zulla: We recently launched our lung cancer screening initiative. This involves programs to drive patient engagement around one of the most impactful screening opportunities in our patient population. By increasing awareness and access, we can help more patients get screened, diagnosed earlier, and connected to life-saving care. Lung cancer remains the leading cause of cancer-related deaths in the US, and only about 18% of eligible individuals currently receive the screening. A striking gap when compared to the 72% screening rate for colorectal cancer. Targeted clinical outreach efforts like these remain a strength for our company. In Q2, we continued to advance our capital-light best-of-breed technology strategy. Today, we are giving that integrated capability a name, Lumexa Connect. Lumexa Connect is the operating platform that connects patients, referring physicians, radiologists, and health system partners across the imaging journey.

Speaker #3: By increasing awareness and access, we can help more patients get screened, diagnosed earlier, and connected to life-saving care. Lung cancer remains the leading cause of cancer-related deaths in the U.S., and only about 18% of eligible individuals currently receive the screening—a striking gap when compared to the 72% screening rate for colorectal cancer.

Speaker #3: Targeted clinical outreach efforts like these remain a strength for our company. In Q2, we continue to advance our Capital Light, best-of-breed technology strategy. Today, we are giving that integrated capability a name: Lumexa Imaging Connect.

Speaker #3: Lumexa Connect is the operating platform that connects patients, referring physicians, radiologists, and health system partners across the imaging journey. Built on leading technologies, our platform allows us to rapidly integrate emerging innovations rather than require us to develop every solution ourselves.

Caitlin Zulla: Built on leading technologies, our platform allows us to rapidly integrate emerging innovations rather than require us to develop every solution ourselves. Lumexa Connect is foundational to our strategy, and it is designed to help us move faster, onboard new partners efficiently, improve access, increase capacity, and scale efficiently as we grow. We are already seeing this strategy deliver results. We remain on track to deploy Fast Scan across two-thirds of our centers by year-end, helping shorten MRI scan times and expand capacity. We are also advancing virtual MRI capabilities and rolling out AI-powered dictation and reporting tools designed to improve radiologist efficiency, reduce physician burnout, and accelerate report turnaround time. Lumexa Connect is not a new strategy. It is the name for the scalable operating platform that already supports our centers, our partners, and our continued growth. New name, still capital-light, still best of breed.

Speaker #3: Lumexa Connect is foundational to our strategy, and it's designed to help us move faster, onboard new partners efficiently, improve access, increase capacity, and scale efficiently as we grow.

Speaker #3: We're already seeing this strategy deliver results. We remain on track to deploy FastScan across two-thirds of our centers by year-end, helping shorten MRI scan times and expand capacity.

Speaker #3: We're also advancing virtual MRI capabilities and rolling out AI-powered

Speaker #1: A dictation and reporting tools designed to improve radiologists efficiency , reduce physician burnout and accelerate report turnaround times . We . The Kinect is not a new strategy .

Speaker #1: It is the name for the scalable operating platform that already supports our centers, our partners, and our continued growth. The new name is still capital.

Speaker #1: Light . Still best of breed . And we'll continue to evolve this platform with the best technologies to support improved service and operating performance for our patients .

Caitlin Zulla: We will continue to evolve this platform with the best technologies to support improved service and operating performance for our patients, referring physicians, radiologists, and health system partners. In that regard, I would like to take a moment to highlight another differentiating aspect of our company, investments that enable the goals of our own technologists. I am delighted to share that in Q2, we graduated our 100th technologist from Lumexa's Technologist Advancement Academy, spanning advanced modalities and mammography, including technologists from across all of our geographies. I am proud of our teams who support this important initiative, helping make Lumexa a great place for our clinical team members to call home. Wrapping up, I am pleased with the gains we are achieving as we proceed with good momentum into the second half of the year.

Speaker #1: Referring physicians , radiologists , and health system partners . In that regard , I would like to take a moment to highlight another differentiating aspect of our company investments that enable the goals of our own technologists .

Speaker #1: I'm delighted to share that in Q2 , we graduated our 100th technologist from Mexico's technologists Advancement Academy . Spanning advanced modalities and mammography , including technologists from across all of our geographies .

Speaker #1: I'm proud of our teams who support this important initiative , helping make Lumecca a great place for our clinical team members to call home Wrapping up , I'm pleased with the gains we're achieving as we proceed with good momentum into the second half of the year .

Speaker #1: De novos are ramping. Advanced modalities are growing as a percentage of our mix. Our JV pipeline is robust, and we're expanding into important new markets with exceptional health system partners.

Caitlin Zulla: De novos are ramping, advanced modalities are growing as a percentage of our mix, our JV pipeline is robust, and we are expanding into important new markets with exceptional health system partners. I remain confident in our ability to execute on our strategic priorities and deliver on our full-year commitments, and I believe we are just getting started. Before I turn the call over to Tony, I will pause as I do every quarter to say a huge thank you to our dedicated team members and radiologists. Your commitment to our patients and to our mission is the foundation of everything we do. With that, Tony, please continue.

Speaker #1: I remain confident in our ability to execute on our strategic priorities and deliver on our full-year commitments, and I believe we are just getting started. Before I turn the call over to Tony, I will pause, as I do every quarter, to say a huge thank you to our dedicated team members and radiologists.

Speaker #1: Your commitment to our patients and to our mission is the foundation of everything we do . With that , Tony , please continue

Speaker #2: Thank you, Caitlin, and thank you all for joining us tonight. I'll review the financial results and speak to key drivers of our performance for the quarter.

Tony Martin: Thank you, Caitlin. Thank you all for joining us. Tonight, I will review the financial results and speak to key drivers of our performance for the quarter. I will then provide our outlook for the full year. To supplement my review of our GAAP financials, I will discuss certain system-wide financial and operating metrics that provide additional perspective on our overall performance and the breadth of our business. We use these metrics in managing the business because they reflect activity across all of the centers we operate, both wholly owned as well as the centers we operate in our joint ventures with health systems. Turning to our Q2 financials, consolidated revenues came in at $264.2 million, an increase of 5.1% compared to the same period last year. System-wide revenue growth, which includes all sites we operate, was 6% in the quarter, powered by strong growth in advanced modalities.

Speaker #2: I will then provide our outlook for the full year to supplement my review of our GAAP financials. I will discuss certain system-wide financial and operating metrics that provide additional perspective on our overall performance and the breadth of our business. We use these metrics in managing the business because they reflect activity across all of the centers.

Speaker #2: We operate both wholly owned centers as well as the centers we operate in our joint ventures with health systems. Turning to our second quarter financials, consolidated revenues came in at $264.2 million.

Speaker #2: An increase of 5.1% compared to the same period last year . System wide revenue growth , which includes all sites we operate , was 6% in the quarter , powered by strong growth in advanced modalities , revenue per scan in our outpatient segment increased 2.2% .

Tony Martin: Revenue per scan in our outpatient segment increased 2.2%. This is a system-wide metric we use because it provides useful perspective on outpatient economics by capturing both the technical scan revenue and, where applicable, the associated professional read revenue. The year-over-year increase was driven by advanced modalities representing a larger share of our business, together with modest increases in contracted payer rates, partially offset by payer mix shifts in a few markets. I would like to review some important volume metrics before going into more detail on our financials. We experienced strong system-wide volume performance across our outpatient sites during Q2, both wholly owned and in JVs. System-wide volume growth was 3.1%, with strength in advanced imaging being somewhat tempered by routine scans. Although we did see improvement in mammography volumes that started the year slower than expected.

Speaker #2: This is a system wide metric we use because it provides useful perspective on outpatient economics by capturing both the technical scan revenue and , where applicable , the associated professional read revenue The year over year increase was driven by advanced modalities representing a larger share of our business , together with modest increases in contracted payer rates partially offset by payer mix shifts in a few markets I would like to review some important volume metrics before going into more detail on our financials We experienced strong system wide volume performance across our outpatient sites during Q2 , both wholly owned and in JVs System wide volume growth was 3.1% , with strength in advanced imaging being somewhat tempered by routine scans Although we did see improvement in mammography volumes that started the year slower than expected .

Speaker #2: While routine scans impact our earnings less than advanced . We were glad to see them improve during the quarter Advanced modality volumes , which generally reimburse 3 to 4 times higher than routine modalities , were a highlight and grew 6.3% system wide versus prior year , and 6.8% on a consolidated basis .

Tony Martin: While routine scans impact our earnings less than advanced, we were glad to see them improve during the quarter. Advanced modality volumes, which generally reimburse 3 to 4 times higher than routine modalities, were a highlight and grew 6.3% system-wide versus prior year and 6.8% on a consolidated basis. As Caitlin already highlighted, this quarter, advanced modalities represented 37.4% of our volumes, a 111 basis point increase over the prior year period. We are encouraged that these procedures have continued to steadily grow and represent a higher mix of our system-wide volumes. Now for a bit more detail on our consolidated revenues. Outpatient net patient service revenues, at $143.7 million, grew 3.5% on healthy same site growth. Professional fee net patient service revenues, our second operating segment, were $60.0 million, reflecting growth of 5%, in line with our model.

Speaker #2: As Caitlin already highlighted this quarter , advanced modalities represented 37.4% of our volumes . A 111 basis point increase over the prior year period We're encouraged that these procedures have continued to steadily grow and represent a higher mix of our system wide volumes .

Speaker #2: Now for a bit more detail on our consolidated revenues Outpatient net patient service revenues at 143.7 million , grew 3.5% on healthy same site growth Professional fee net patient service revenues Our second operating segment were 60.0 million , reflecting growth of 5% .

Speaker #2: In line with our model, finally, management fee and other revenues grew $7.2 million and were $60.4 million for the quarter. Within that management fee line, roughly $26 million primarily represents management fees we earn from operating the sites in our health system.

Tony Martin: Finally, management fee and other revenues grew $7.2 million and were $60.4 million for the quarter. Within that management fee line, roughly $26 million primarily represents management fees we earn from operating the sites in our health system JVs, which saw particular strength this quarter. The remaining $34 million in this category represents zero margin pass-throughs of employee, IT, and site-level costs that we pay on behalf of our joint ventures. When you are modeling us, it is important to understand these two components in terms of impact to margin. G&A for the quarter was $24.4 million, up $5.7 million from Q2 of 2025. This increase was expected and driven by $5.9 million higher expenses from the two primary components we talked about last quarter and that will continue to impact year-over-year comparisons throughout 2026. They are as follows.

Speaker #2: , which saw particular strength this quarter . The remaining 34 million in this category represents zero margin pass through of employee . IT and site level costs that we pay on behalf of our joint ventures .

Speaker #2: When you're modeling us , it's important to understand these two components in terms of impact to margin , G and A for the quarter was 24.4 million , up 5.7 million from the second quarter of 2025 .

Speaker #2: This increase was expected and driven by 5.9 million higher expenses from the two primary components . We talked about last quarter , and that will continue to impact year over year comparisons throughout 2026 .

Speaker #2: They are as follows. First, our Pubco costs, which are ongoing expenses related to being a public company. These were $1.5 million in the quarter, and we continue to expect approximately $7 million of these costs for the full year 2026.

Tony Martin: First, our PubCo costs, which are ongoing expenses related to being a public company. These were $1.5 million in the quarter, and we continue to expect approximately $7 million of these costs for full year 2026. Second, and also similar to last quarter, is an increase in stock-based compensation from $8.3 million in Q2 of 2025 to $12.7 million in Q2 of 2026. This reflects the one-time resetting of legacy equity comp plans as part of our IPO. We expect full year stock-based comp for 2026 to be approximately $50 million. About half of that relates to historic M&A and will be fully amortized by the end of 2026. As a result, we anticipate ongoing stock-based compensation of approximately $20 million to $28 million for full year 2027. Below operating expenses, we include our equity and earnings of unconsolidated affiliates.

Speaker #2: Second , and also similar to last quarter , is an increase in stock based compensation from 8.3 million in Q2 of 25 to 12.7 million in Q2 of 26 .

Speaker #2: This reflects the one time resetting of legacy equity comp plans as part of our IPO . We expect full year stock based comp for 2026 to be approximately 50 million , about half of that relates to historic M&A and will be fully amortized by the end of 2026 .

Speaker #2: As a result , we anticipate ongoing stock based compensation of approximately 20 to 28 million for full year 2027 . Below operating expenses , we include our equity and earnings of unconsolidated affiliates This is our pro rata ownership share of the net income of our JV sites The line item in our financials that reflects contributions from these important partnerships .

Tony Martin: This is our pro rata ownership share of the net income of our JV sites, the line item in our financials that reflects contributions from these important partnerships. At $18.6 million, this was $2.1 million higher than Q2 of 2025, reflecting particular strength this quarter in the sites we operate with health system partners. Below the operating line, interest expense was $16.2 million in Q2. This new run rate is $14 million less than Q2 2025, reflecting our use of IPO proceeds to pay down debt last December, freeing up more than $50 million in cash interest expense savings on an annualized basis and increasing our flexibility to invest in growth. In addition, we repriced our debt in June 2026, further reducing our go-forward run rate for interest expense by $1 million per quarter starting in Q3.

Speaker #2: At 18.6 million . This was 2.1 million higher than Q2 of 25 , reflecting particular strength this quarter in the sites we operate with health system partners below the operating line , interest expense was 16.2 million in Q2 .

Speaker #2: This new run rate is 14 million less than Q2 25 , reflecting our use of IPO proceeds to pay down debt last December , freeing up more than 50 million in cash .

Speaker #2: Interest expense savings on an annualized basis and increasing flexibility to invest in growth . In addition , we repriced our debt in June 2026 , further reducing our go forward run rate for interest expense by 1 million per quarter .

Speaker #2: Starting in Q3 , pre-tax income was 5.8 million for Q2 , compared to a pre-tax loss of $2.4 million in Q2 25 . After a tax provision of about 3 million in the quarter .

Tony Martin: Pre-tax income was $5.8 million for Q2, compared to a pre-tax loss of $2.4 million in Q2 2025. After a tax provision of about $3 million in the quarter, net income was $2.7 million in Q2, compared to a net loss of $7.2 million in the prior year period. Our GAAP EPS was $0.03 per share in Q2 and adjusted EPS was $0.20. Turning now to adjusted EBITDA, which is an important supplemental measure we use to evaluate operating performance across our entire network. It includes adjusted EBITDA from our wholly owned centers as well as our pro rata share from the centers we operate through our health system joint ventures. Adjusted EBITDA was $56.4 million in the quarter, compared with $56.3 million a year ago. Underlying performance benefited from healthy overall volumes and strong growth in advanced modalities.

Speaker #2: Net income was $2.7 million in Q2 , compared to a net loss of 7.2 million in the prior year period . Our GAAP EPS was $0.03 per share in Q2 , and adjusted EPS was $0.20 .

Speaker #2: now to adjusted EBITDA , which is an important supplemental measure we use to evaluate operating performance across our entire network . It includes adjusted EBITDA from our wholly owned centers , as well as our pro rata share from the centers we operate through our health system , joint ventures .

Speaker #2: Adjusted EBITDA was $56.4 million in the quarter, compared with $56.3 million a year ago. Underlying performance benefited from healthy overall volumes and strong growth in advanced modalities.

Speaker #2: While our reported growth absorbed incrementally , public company costs and planned investments associated with ramping our de novo centers the year over year comparison also reflects a tougher prior year baseline than we saw in Q1 , as the volume recovery following the resolution of an out of situation , was largely resolved by the second quarter of 2025 .

Tony Martin: While our reported growth absorbed incremental PubCo costs and planned investments associated with ramping our de novo centers, the year-over-year comparison also reflects a tougher prior year baseline than we saw in Q1, as the volume recovery following the resolution of an out-of-network situation was largely resolved by Q2 2025. Our adjusted EBITDA margin was 21.4% in Q2 2026, compared to 22.4% in Q2 2025, partly due to the $1.5 million step-up in PubCo costs. Sequentially, adjusted EBITDA margin increased 110 basis points from Q1. On the cash flow front, cash flows from operating activities were $32.8 million in Q2 2026. This is $31 million higher than Q2 2025, reflective of our lower senior credit facility debt and related interest payments.

Speaker #2: Our adjusted EBITDA margin was 21.4% in Q2 26 , compared to 22.4% in Q2 25 , partly due to the 1.5 million step up in public company costs sequentially .

Speaker #2: Adjusted EBITDA margin increased 110 basis points from Q1 on the cash flow front , cash flows from operating activities were 32.8 million in Q2 26 .

Speaker #2: This is $31 million higher than Q2 '25, reflective of our lower senior credit facility debt and related interest payments. Free cash flow, which we define as cash flows from operating activities...

Tony Martin: Free cash flow, which we define as cash flows from operating activities less CapEx, was $23.1 million for Q2 2026, a record high for the company, compared to negative $2.5 million in Q2 2025. This is a $25.6 million improvement and resulted in a conversion in Q2 of roughly 41% of adjusted EBITDA, which is another record. The improvement was largely attributable to our reduced debt and related interest expense that demonstrates the ability of our business to continue to generate strong cash flow. Recall that we used the full IPO proceeds to pay down debt in order to free up cash to pursue our market opportunity, grow the company, and de-lever.

Speaker #2: Less CapEx was 23.1 million for Q2 26 , a record high for the company compared to -2.5 million in Q2 25 . This is a $25.6 million improvement , and resulted in a conversion in Q2 of roughly 41% of adjusted EBITDA , which is another record .

Speaker #2: The improvement was largely attributable to our reduced debt and related interest expense . That demonstrates the ability of our business to continue to generate strong cash flow .

Speaker #2: Recall that we used the full IPO proceeds to pay down debt in order to free up cash to pursue our market opportunity , grow the company and deliver We would not read a single quarter as a new run rate , but as we have said previously , we continue to expect 2026 free cash flow conversion to be approximately 25 to 30% of adjusted EBITDA on a full year basis , while free cash flow conversion can vary , we believe this conversion range will improve as we scale our business .

Tony Martin: We would not read a single quarter as a new run rate, but as we have said previously, we continue to expect 2026 free cash flow conversion to be approximately 25% to 30% of adjusted EBITDA on a full year basis. While free cash flow conversion can vary, we believe this conversion range will improve as we scale our business. Now for a moment on CapEx. We continue to see the opportunity to accelerate our growth plans in our fragmented industry and to target meaningful returns by investing in de novos, adding new and upgraded equipment and capabilities at our existing sites, and through targeted M&A. Our $9.7 million capital spend in Q2 2026 reflects a busy quarter of investment activity and is not a change in our underlying spending plan. We continue to anticipate approximately $5 million to $7 million in cash CapEx per quarter.

Speaker #2: And now, for a moment on CapEx. We continue to see the opportunity to accelerate our growth plans in our fragmented industry and to target meaningful returns by investing in de novos, adding new and upgraded equipment and capabilities at our existing sites, and through targeted M&A.

Speaker #2: Our $9.7 million capital spend in Q2 26 reflects a busy quarter of investment activity and is not a change in our underlying spending plan .

Speaker #2: We continue to anticipate approximately 5 to 7 million in cash CapEx per quarter , shifting to the balance sheet . Our capital position is strong , and we ended the quarter with 69.7 million in cash and cash equivalents , up from 51.2 million at the start of the quarter .

Tony Martin: Shifting to the balance sheet, our capital position is strong, and we ended the quarter with $69.7 million in cash and cash equivalents, up from $51.2 million at the start of the quarter. As of 30 June, net leverage was 3.6 times, compared to 5.7 times a year ago. Further, we are committed to managing our capital structure strategically, and at the end of Q2, we repriced our term loan to a rate of SOFR plus 250 basis points. This reduction generates an additional annual cash interest savings of $4 million per year, starting in Q3. Wrapping up with our outlook, we are pleased with our accomplishments in Q2, including progress across key growth initiatives. With half the year complete, we are narrowing our adjusted EBITDA guidance range to $235 million to $241 million, versus the previous range of $234 million to $242 million, while maintaining the midpoint at $238 million.

Speaker #2: As of June 30th , net leverage was 3.6 times , compared to 5.7 times a year ago Further , we're committed to managing our capital structure strategically , and at the end of Q2 , we repriced our term loan to a rate of Sofr plus 250 basis points .

Speaker #2: This reduction generates an additional annual cash interest savings of 4 million per year , starting in Q3 . Wrapping up with our outlook , we're pleased with our accomplishments in Q2 , including progress across key growth initiatives .

Speaker #2: And so, with half the year complete, we're narrowing our adjusted EBITDA guidance range to $235 million to $241 million, versus the previous range of $234 million to $242 million, while maintaining the midpoint at $238 million.

Speaker #2: The narrower range reflects our first half results . Our view of the business and continued confidence in the underlying assumptions supporting our guidance .

Tony Martin: The narrower range reflects our H1 results, our view of the business, and continued confidence in the underlying assumptions supporting our guidance. Adjusted EBITDA reflects our full system-wide footprint, including our pro rata share of JV performance, while our consolidated revenue guidance reflects only our majority-owned centers. That scope difference, not a change in our view of either business, is why we are narrowing adjusted EBITDA guidance while our revenue guidance remains unchanged. Tonight, we are reiterating our consolidated revenue guidance of $1.045 billion to $1.097 billion and our adjusted EPS guidance of $0.71 to $0.77 per share. As we move into Q3 and continue executing on our goals, we are energized by the opportunities in front of us and the progress we have made so far this year. With that, let us turn to your questions. Operator, would you please open the call?

Speaker #2: Adjusted EBITDA reflects our full system wide footprint , including our pro rata share of JV performance , while our consolidated revenue guidance reflects only our majority owned centers that scope difference , not a change in our view of either business , is why we're narrowing adjusted EBITDA guidance .

Speaker #2: While our revenue guidance remains unchanged . And so tonight , we're reiterating our consolidated revenue guidance of 1.45 billion to 1.097 billion , and our adjusted EPS guidance of 71 to $0.77 per share As we move into Q3 and continue executing on our goals , we're energized by the opportunities in front of us and the progress we've made so far this year So with that , let's turn to your questions Operator , would you please open the call

Speaker #3: Certainly. And, ladies and gentlemen, we ask that you please limit yourself to one question. Our first question comes from the line of Brian Tanquilut from Jefferies.

Operator: Certainly. Ladies and gentlemen, we ask that you please limit yourself to one question. Our first question comes from the line of Brian Tanquilut from Jefferies. Your question please.

Speaker #3: Your question please .

Speaker #4: Hey . Good afternoon . This is this is Bret Krukowski on for Brian with Jefferies . Thanks for taking the questions here . As we think about the second half of the year , can you talk about the expectations for the seasonality in the business ?

Brett Grolkowski: Hey, good afternoon. This is Brett Grolkowski on for Brian Tanquilut with Jefferies. Thanks for taking the questions here. As we think about the H2 of the year, can you talk about the expectations for the seasonality in the business, and then if there is any other incremental drivers to point out as we think about the sequential ramp?

Brett Grulkowski: Hey, good afternoon. This is Brett Grolkowski on for Brian Tanquilut with Jefferies. Thanks for taking the questions here. As we think about the H2 of the year, can you talk about the expectations for the seasonality in the business, and then if there is any other incremental drivers to point out as we think about the sequential ramp?

Speaker #4: And then if there's any other incremental drivers to point out , as we think about the sequential ramp Thanks

Caitlin Zulla: Thanks so much, Brett. Appreciate the question. Maybe I will kick it off, and then I will turn it over to Tony to talk a little bit more about H2 pacing. We are very excited by the progress we have been able to demonstrate this year. Advanced imaging continues to be strong. Really thrilled by our new company record of the 37.4% of volumes coming from advanced imaging. As you will remember, last year, we did a record number of de novos. We opened up nine. Pacing of those were three in Q1, three in Q2, zero in Q3, and then three in Q4. Excited by the progress we have been able to see in the ramping of our 2024 and 2025 de novo cohorts.

Speaker #1: Thanks so much . I appreciate the question . Maybe I'll kick it off and then I'll turn it over to Tony to talk a little bit more about second half pacing .

Speaker #1: So we are very excited by the progress we've been able to demonstrate this year . Advanced imaging continues to be strong . Really thrilled by our new company , record .

Speaker #1: Of 37.4% of volumes coming from advanced imaging . And as you last year , we did a record number of de novos . We opened up nine pacing of those for three in the first quarter , three in the second , zero , in the third , and then three in the fourth .

Speaker #1: And so excited by the progress we've been able to see in the ramping of our 2024 and 2025 de novo cohorts . And so what you see is really a compounding of all of these trends as we enter in the second half of the year , which is why we were confident in reaffirming our guidance .

Caitlin Zulla: And so what you see is really a compounding of all of these trends as we enter in the H2 of the year, which is why we were confident in reaffirming our guidance and narrowing the range. But Tony, I will let you maybe talk a little bit more about specific pacing.

Speaker #1: And narrowing the range . But , Tony , I'll let you maybe talk a little bit more about specific pacing .

Speaker #2: Sure , sure . Yes . The momentum is what we expected as the year would unfold . There is a natural seasonality to the business .

Tony Martin: Sure. Yes. The momentum is what we expected as the year would unfold. There is a natural seasonality to the business and we are seeing that happen. As we reported last quarter, we expected 45% of our earnings in the H1 of the year and 55% in the back half, and we are right on that. That comes from the seasonal ramping of volume and the ramping of our de novos. We had so many of them come out of the ground in 2025. So right on target for the 45% in the H1 and the ramping that we expect to continue sequentially Q3 and Q4. Actually it was 45.3%, if we want to take it out to a decimal point. So we are actually a little bit ahead of that.

Speaker #2: And , you know , we're seeing that happen . And as we reported last quarter , you know , we expected 45% of our earnings in the first half of the year and 55% in the back half .

Speaker #2: And , you know , we're right on that . That comes from , you know , the seasonal ramping of volume and ramping up our de novos .

Speaker #2: You know, we had so many of them come out of the ground in 2025, so right on target for the 45% in the first half.

Speaker #2: And the ramping that we expect to continue kind of sequentially in Q3 and Q4 . And actually at 45.3% , if we want to , you know , take it out to a decimal point or actually a little bit ahead of that

Speaker #4: Great . Okay . Yeah , that's helpful . And then for a follow up , could you maybe provide some additional color on the recent JV , maybe on how it's progressed in the early stages ?

Brett Grolkowski: Great. Okay. Yeah, that is helpful. For a follow-up, could you maybe provide some additional color on the recent HSS JV, maybe on how it has progressed in the early stages, and then if there is any future expansion opportunity there? Then maybe more broadly, what the pipeline, as a whole for new JV opportunities looks like. Thank you.

Brett Grulkowski: Great. Okay. Yeah, that is helpful. For a follow-up, could you maybe provide some additional color on the recent HSS JV, maybe on how it has progressed in the early stages, and then if there is any future expansion opportunity there? Then maybe more broadly, what the pipeline, as a whole for new JV opportunities looks like. Thank you.

Speaker #4: And then if there's any future expansion opportunity there, and then maybe more broadly, what the pipeline as a whole for new JV opportunities looks like.

Speaker #4: Thank you

Speaker #1: Yes. Happy to talk about HSF. It was a very exciting milestone for the company. HSF, obviously, is a world-renowned institution.

Caitlin Zulla: Yes. Happy to talk about HSS. It was a very exciting milestone for the company. HSS, obviously world-renowned institution and so focused on musculoskeletal, which obviously requires imaging in every part of the diagnosis and treatment. With HSS, similar to UPMC, we are focusing on a de novo approach. We have already targeted markets in the New York metropolitan area and are actively advancing site plans. New York does have CON requirements that will require a little bit longer of an extended timeline, but excited to talk a little bit more about this as we go into 2027. Then we think about the second part of your question about hospital engagement and hospital pipelines. One of the reasons I am the most excited to be in this role at Lumexa is the early days around opportunities to continue to grow to serve outpatient needs in the industry.

Speaker #1: And you're so focused on musculoskeletal , which obviously requires imaging in every part of the diagnosis and treatment with HSS , similar to UPMC , we were focusing on a de novo approach .

Speaker #1: We've already targeted markets in the New York metropolitan area and actively advancing site plan . New York does have a con requirements that will require a little bit longer of an extended timeline , but excited to talk a little bit more about this as we go into 2027 .

Speaker #1: And then we think about the second part of your question about hospital engagement and hospital pipeline . One of the reasons I'm the most excited to be in this role at Lumex is the early days around opportunities to continue to grow , to serve outpatient needs in the industry , starting first radiology demand continues to grow for all the reasons we talked about novel treatment paradigms , increased screening mandates , technological advances , and there's continued unmet demand .

Caitlin Zulla: Starting first, radiology demand continues to grow for all the reasons we talked about, right, novel treatment paradigms, increased screening mandates, technological advances, and there is continued unmet demand. It is also an incredibly fragmented landscape and very early days for health systems to really begin to formalize what is their outpatient imaging strategy. We have got an exciting pipeline of health systems we are talking to. We look forward to giving more updates across upcoming quarters. There is a lot of growth and opportunity in this space. Thanks so much, Brett.

Speaker #1: And then, it is also an incredibly fragmented landscape, and it's still very early days for health systems to really begin to formalize what is their outpatient imaging strategy.

Speaker #1: And so we've got an exciting pipeline of health systems . We're talking to . We look forward to giving more updates across , you know , upcoming quarters .

Speaker #1: But there is there's a lot of growth and opportunity in this space . Thanks so much , Bret

Speaker #4: Thanks

Brett Grolkowski: Thanks.

Brett Grulkowski: Thanks.

Speaker #3: Thank you. And our next question comes from the line of Andrew Cooper from Raymond James. Your question, please.

Operator: Thank you. Our next question comes from the line of Andrew Cooper from Raymond James. Your question, please.

Speaker #5: Hey , everybody . Thanks for the questions . Maybe first , you know , we've heard a lot from from different players in the space through the quarter or through the earnings reports already .

Andrew Cooper: Hey, everybody. Thanks for the questions. Maybe first, we have heard a lot from different players in the space through the quarter or through their earnings reports already. I guess, I think, Tony, you mentioned some payer mix shift in a few markets. Could you touch on that a little bit more and anything you are seeing from a procedure mix perspective, whether it is changes in ortho related imaging versus more acute-oriented procedures? Just would love your observations in underlying some of the volume changes.

Speaker #5: I guess I think , Tony , you mentioned some payer mix shift in a few markets . Could you touch on that a little bit more ?

Speaker #5: And anything you're seeing from a procedure mix perspective , whether it's changes in , you know , ortho related imaging versus more kind of acute oriented procedures ?

Speaker #5: Just would love your observations on, kind of, underlying some of the volume changes.

Speaker #2: Sure . I'll ask to add some color after I give you a couple couple numbers here , but you know , really ? Yeah , we saw just a little bit of , of shift in , in payer mix .

Tony Martin: Sure. I will ask that Caitlin add some color after I give you a couple numbers here, but really, we saw just a little bit of shift in payer mix. Nothing significant. It was in a couple of markets, and it was different than what we had in Q1. We had different parts of the business experience some ebbs and flows in this stuff. So really nothing of note or anything that would be a long-term trend. Just a modest shift. You could see we came in where we expected, so obviously was not significant. Caitlin can-

Speaker #2: Nothing , nothing significant within a couple , a couple markets . And it was kind of different than what we had in Q Q1 you know , we had , different parts of the business experience .

Speaker #2: You know , some ebbs and flows in this stuff . So really nothing , nothing of note or anything that would be a long term trend .

Speaker #2: Just kind of a , you know , modest shift and you could see , you know , we came in where we expected .

Speaker #2: So it obviously wasn't significant. And Caitlin...

Speaker #6: Yeah, I can really take the acuity piece.

Caitlin Zulla: Yeah, I can maybe take the acuity piece, Andrew. As we see acuity as it was across the book, we continue to see real strength in MRI. MRI growth on a system-wide basis was 7.2% quarter-over-quarter. So, continuing to drive our focus on supporting MRI. And then PET. 23.2% growth, as we highlighted in the script. Throughout our journey, we've been talking about the opportunity we have at Lumexa to deepen our PET profile. So thrilled that we're able to say that two of the three machines that we had talked about this year are live, in South Carolina and Arizona. And then we continue to see advancements in the radiotracers. We reference our new estrogen positive breast imaging radiotracer FES. We continue to see strong demand for amyloid, Clarify, also working on Ga-68 and FDG.

Speaker #1: Andrew . So as we see acuity across the book , we continue to see real strength in MRI , MRI growth on a system wide basis was 7.2% quarter over quarter .

Speaker #1: So continuing to , you know , kind of drive our focus on supporting MRI . And then Pet . So 23.2% growth , as we highlighted in the script , throughout our journey , we've been talking about the opportunity we have at Lumex to deepen our pet profile .

Speaker #1: So thrilled that we're able to say that two of the three machines that we had talked about this year are live in South Carolina and Arizona, and we continue to see advancements in the radiotracers.

Speaker #1: You know , we reference our new estrogen positive breast imaging Radiotracer we continue to see strong demand for amyloid clarify . Also working on GA 68 and FDG .

Speaker #1: So continue to focus on expanding Pet as a strategic service line based on the strong demand . There

Caitlin Zulla: Continue to focus on expanding PET as a strategic service line based on the strong acuity demand there.

Speaker #3: Thank you. And our next question comes from the line of Andrew Mock from Barclays. Your question, please.

Operator: Thank you. Our next question comes from the line of Andrew Mok from Barclays. Your question, please.

Speaker #7: Hi . Good afternoon . We don't have the Q yet , so I was hoping you could share the same store system wide revenue growth metric in the quarter and talk through the underlying components of that between volume and price .

Andrew Mok: Hi, good afternoon. We don't have the queue yet, so I was hoping you could share the same store system-wide revenue growth metric in the quarter and talk through the underlying components of that between volume and price. Thanks.

Speaker #7: Thanks

Speaker #2: Sure . The the same site volume growth was that .

Andrew Mok: Sure. The same-site volume growth, was that the question?

Speaker #7: Same store . Yeah . Same store system wide revenue . You know , what did that come in in the quarter ? And then maybe break that down into the component components of price and volume .

Tony Martin: Same-store, yeah. Same-store system-wide revenue, what did that come in in the quarter? Then maybe break that down into the components of price and volume. Thanks.

Speaker #7: Thanks .

Speaker #2: Yeah , yeah . So same , same site system , system wide basis was 4.4% revenue and 2.2% volume , 2.2% rate

Tony Martin: Yeah. So same-site system-wide basis was 4.4% revenue and 2.2% volume, 2.2% rate.

Speaker #7: Got it . That's helpful . And then on the commercial mix side , can I just revisit that for a second ? It was a little bit unclear to me what exactly you're seeing on commercial mix .

Andrew Mok: Got it. That's helpful. Then on the commercial mix side, can I just revisit that for a second? It was a little bit unclear to me what exactly you're seeing on commercial mix. So one, can you help us understand where that finished in the quarter? What was that down year over year? To the extent that you did see some pressure in some of your markets, can you just elaborate on what exactly you saw? Thanks.

Speaker #7: So one , can you help us understand where that finished in the quarter ? What was that down year over year ? And , you know , to the extent that you did see some pressure in some of your markets , can you just elaborate on what exactly you saw ?

Speaker #7: Thanks

Speaker #2: Sure . Yeah . When we get to Q published , it'll it'll show , you know , 59% consolidated of commercial mix , which is the same as it was last year .

Tony Martin: Sure. When we get the Q published, it will show 59% consolidated commercial mix, which is the same as it was last year. There is a very slight downward tick, but nothing significant. We have heard some of the other healthcare providers, particularly the hospitals, talk about a more significant payer mix shift. We didn't really see that. In Q2, it was in a few markets that we consolidate, and in Q1, we had a little bit of degradation more on the JV side, and they just kind of, neither one seems to be a sign of anything durable that we could tell. Like I said, really fractional because it is just kind of a rounding error on our payer mix percentages.

Speaker #2: There's a very slight downward tick , but nothing , you know , nothing significant . Right . We , you know , we have heard , you know , some of the other health care providers , particularly the hospitals , talk about , you know , a more significant payer makeshift .

Speaker #2: We didn't really see that in . Q two . It was in a few markets that we consolidate . And in Q1 , we had a little bit of degradation more on the JV side .

Speaker #2: And they just kind of , you know , neither one is seems to be a sign of anything you know , durable that we could tell .

Speaker #2: And like I said, in a really fractional way because, you know, it does kind of act as a rounding error on our payer mix percentages.

Speaker #3: Thank you. And our next question comes from the line of Whit Mayo from Leerink Partners. Your question, please.

Operator: Thank you. Our next question comes from the line of Whit Mayo from Leerink Partners. Your question, please.

Speaker #8: Hi . Hey , thanks . Looking at the first quarter , you guys had , you know , some weather related disruption . Do you think you recovered any of that volume in the second quarter , or is that just all lost at this point ?

Whit Mayo: Hey, thanks. Looking at Q1, you guys had some weather-related disruption. Do you think you recovered any of that volume in Q2, or is that just all lost at this point?

Speaker #6: Yeah . Hey , whit .

Caitlin Zulla: Yeah. Hey, Whit. Thank you for the question. Maybe I will start. We saw strength of advance in Q1, and we are really proud of how it ended. Our thinking was there would be very little carryover of advance into Q2. Talking about advanced performance in Q2, again, performed well. You can see the impact of our new facilities are having on our overall enterprise growth rate. One of the areas that we were focused on the recovery front, was mammography. We had talked about that lagging at the end of Q1. Excited to see mammography growth this quarter. Mammo is up 2.6% year over year, and continued to grow north of 6% on a per day basis over Q1. So, the one area where we did see a little bit of opportunity and pull-through is in mammo.

Speaker #1: Thank you for the question. Maybe I'll start. We saw strength of advance in Q1, and we're really proud of how it ended.

Speaker #1: And so our thinking was there would be very little carryover of advanced into Q2. Talking about advanced performance in Q2, you know, again, it performed well.

Speaker #1: You can see the the impact of our new facilities are having on our overall , overall enterprise growth rate . And one of the areas that we were focused on , on the recovery front was mammography .

Speaker #1: And so we had talked about that lagging at the end of Q1 . Excited to see mammography growth this quarter was up 2.6% year over year and continue to grow north of 6% on a per day basis over Q1 .

Speaker #1: So , you know , the one area where we did see a little bit of opportunity and pull through is in Mammo again , we focused on advanced because they reimburse at a significant higher rate than routine , but nice to see the recovery within the Mammo book .

Caitlin Zulla: Again, we focus on advance because they reimburse at a significant higher rate than routine, but nice to see the recovery within the mammo book.

Speaker #8: Okay. I was curious if there was any cost that you'd care to call out related to the data breach.

Whit Mayo: Okay. I was curious if there was any cost that you'd care to call out related to the data breach.

Speaker #1: Yeah , thanks , whit . When we think about data breach , we disclosed it in our Q one to create clarity that the breach was related to a vendor and not our systems .

Caitlin Zulla: Yeah, thanks, Whit. When we think about data breach, we disclosed it in our Q1, to create clarity that the breach was related to a vendor and not our systems. Second, to highlight the fact we've seen minimal impact on the business. We have not seen any costs that require us to say that we think it'll be impacting the business or have a material impact. We want to continue to be transparent about the journey we are on, and make sure that we're answering any of your questions.

Speaker #1: And then second , to highlight the fact we've seen minimal impact on the business , we have not seen , you know , any costs that require us to say that we think it will be impacting the business or how the impact .

Speaker #1: And we want to continue to be transparent about the journey we are on and make sure that we're answering any of your questions

Speaker #3: Thank you . And our next question comes from the line of Stephen Baxter from Wells Fargo . Your question , please .

Operator: Thank you. Our next question comes from the line of Stephen Baxter from Wells Fargo. Your question, please.

Speaker #9: Hi . I just wanted to ask a follow up on the cadence . I get that we're we're on track in terms of the , you know , the 45 versus 55% allocation .

Stephen Baxter: Hi, just wanted to ask, like a follow-up on the cadence. I get that we're on track in terms of the 45% versus 55% allocation, but when we think about the H1 EBITDA growth needing to improve a good amount in the H2, should we be thinking that that's primarily going to be driven by better growth or maybe improved margin profile versus what you delivered in the H1 of the year? Then, have a follow-up. Thanks.

Speaker #9: But we think about the first half EBITDA growth needing to improve , you know , a good amount in the back half . Should we be thinking that that's primarily going to be driven by better growth ?

Speaker #9: Or maybe improved margin profile versus what you delivered in the first half of the year? And then I have a follow-up. Thanks.

Speaker #2: Sure. Yeah. I mean, kind of a good starting point is just what tends to happen sequentially from Q1 all the way through Q4.

Tony Martin: Sure. Yeah, a good starting point is just what tends to happen sequentially, from Q1 all the way through Q4. As we've talked about in past calls, it's a sequential ramp from when the deductibles reset, as you know. So from Q1 to Q2 sequentially, our adjusted EBITDA grew nearly 11%. That's an example of what tends to happen with seasonality of the business. You see some meaningful step-ups just from the pure seasonality component. So we believe that undergirds everything that happens at all the sites from year to year, and that's a big part of it. In addition, you've seen, as Caitlin Dula described, more and more of our volumes are coming from advance, and that too provides some more momentum sequentially as the quarters unfold. Then, of course, the de novos.

Speaker #2: You know , as we talked about in past calls , you know , it's a sequential ramp from when the when the deductibles reset , as you know .

Speaker #2: So, from Q1 to Q2, sequentially, our adjusted EBITDA grew nearly 11%. And so that's an example of what tends to happen with seasonality of the business.

Speaker #2: You see some meaningful step-ups just from the seasonality component. So we believe that that undergirds everything that happens at all the sites from year to year.

Speaker #2: And that's a big part of it . In addition , you , you've seen as Caitlin described , more and more of our volumes are coming from advanced and that that to provides more momentum as you know , sequentially as the quarters unfold .

Speaker #2: And then , of course , the de novo , you know , we opened a few toward the end of 2020 for a lot more than 2025 .

Tony Martin: We opened a few toward the end of 2024, a lot more in 2025. So with our typical ramp of those, they tend to get to breakeven in a year or so. So, the ones we opened in 2024, it was only 4 compared to more than double that, 9 last year. Those are ramping the profitability this year and already are earlier in our reported numbers. There's not very many of them, but those 2024 ones are right on target, and that means they're making some money. The 2025 ones are going to gain a lot more momentum in the H2 of the year. They are doing very well against expectations. We map out our path to when they'll reach breakeven and where they'll go from there. We did a deep dive recently on all of them and feel great about where they're headed.

Speaker #2: So with our , our typical ramp of those , you know , they tend to get to break even in a year or so .

Speaker #2: So , you know , the ones we opened 2024 , it was only four compared to , you know , more than double that ten .

Speaker #2: I mean , nine last year . You know , those are those are ramping profitability this year . And already are , you know , earlier in our reported numbers , there's not very many of them .

Speaker #2: But , you know , those 24 ones are right on target . And that means they're making some money . The 2025 ones are going to gain a lot more momentum in the second half of the year .

Speaker #2: They are doing very well against expectations . You know , we we map out , you know , our path to when they'll reach break even and where they'll go from there .

Speaker #2: We did a deep dive recently on , on all of them . And feel great about where they're headed . And so that Q is meaningful in terms of sequential growth in the second half of the year compared to what we've reported in the first half .

Tony Martin: That too is meaningful in terms of sequential growth in the H2 of the year compared to what we reported in the H1.

Speaker #9: Got it. Okay. And then, just to come back to the policy side, I obviously appreciate you touching on the proposed changes for hospital imaging reimbursement.

Stephen Baxter: Got it. Okay. Just to come back to the policy side, obviously appreciate the touching on the proposed changes for hospital imaging reimbursement. As we think about the types of opportunities this could potentially open up for you, I guess how should we think about that? Is it just an acceleration of the same type of growth that you've seen in JV partnering opportunities you've seen, or do you think there's any opportunity for some of these growth opportunities to maybe develop differently than they have in the past for you? Thanks.

Speaker #9: This is, we think, about the types of opportunities this could potentially open up for you, I guess. How should we think about that?

Speaker #9: Is it is it just an acceleration of the same type of growth that you've seen in JV partnering opportunities that you've seen , or do you think there's any opportunity for some of these growth opportunities to maybe develop differently than they have in the past for you ?

Speaker #9: Thanks .

Speaker #1: Yeah , I think , Steven , we are optimistic and excited about the site neutrality proposed rule . You know , certainly it depends on how it is finalized .

Caitlin Zulla: Yeah. Thanks, Stephen. We are optimistic and excited about the site neutrality proposed rule. Certainly, it depends on how it is finalized. I think first, importantly, as a point of clarification, Lumexa does not rely on hospital outpatient reimbursement premiums. So the proposal really does improve the relative attractiveness of our IDTF model. I see this as a multi-year catalyst versus something that's going to change our results immediately. What I do think, though, it does is it today reinforces the conversations that are already happening, that hospitals need more imaging capacity, and building that capacity in a high-cost hospital setting is becoming increasingly difficult to justify. Our model allows them to expand access, retain patients within their network, participate economically, obviously without relying on that hospital outpatient reimbursement premium.

Speaker #1: I think first , importantly , it's always a point of clarification . New Mexico does not rely on hospital outpatient reimbursement premiums . So the proposal really does improve the relative attractiveness of our Idt's model I see this as a multiyear catalyst versus something that's going to change our results immediately .

Speaker #1: What I do think it does is that it today reinforces the conversations that are already happening: that hospitals need more imaging capacity, and building that capacity in a high-cost hospital setting is becoming increasingly difficult to justify.

Speaker #1: And then our model allows them to expand access , retain patients within their network , participate economically . You know , obviously , without relying on that hospital outpatient reimbursement premium .

Speaker #1: So, we do expect the first impact will be an increased urgency and activity in our partnership pipeline, and then, over time, this will be followed by new centers and expanded relationships.

Caitlin Zulla: We do expect the first impact will be an increased urgency and activity in our partnership pipeline, and then followed over time by new centers and expanded relationships. I just also want to clarify, obviously, our strategy doesn't depend on this rule being finalized, but our underlining value proposition already works. I do think site neutrality would simply strengthen it.

Speaker #1: And I just also want to clarify , obviously , our strategy doesn't depend on this rule being finalized , but the under our underlying value proposition already works .

Speaker #1: But I do think site neutrality would simply strengthen it.

Speaker #3: Thank you. And our next question comes from the line of Chickering from Deutsche Bank. Your question, please.

Operator: Thank you. Our next question comes from the line of Pito Chickering from Deutsche Bank. Your question, please.

Speaker #10: Hey . Good afternoon guys . Thanks for taking my questions . I guess focusing on cash flow from this quarter . It looked pretty good , but I think a lot of it came from increase of accrued expenses .

Pito Chickering: Hey, good afternoon, guys. Thanks for taking my questions. I guess focusing on cash flow from ops this quarter looked pretty good, but I think a lot of it came from increase of accrued expenses. Can you talk about sort of cash flow in Q2 and how we should be thinking about cash flow from ops and CapEx in the back half of the year?

Speaker #10: So, can you talk about cash flow in the second quarter and how we should be thinking about cash flow from operations and CapEx in the back half of the year?

Speaker #2: Sure Yeah . We we feel real good about what Q2 means for the , you know , guidance range . We provided of 25 to 30% conversion rate , you know , that translates to something like 60 to 70 million of free cash flow for the year .

Tony Martin: Sure. We feel real good about what Q2 means for the guidance range we provided of 25% to 30% conversion rate. That translates to something like $60 million to $70 million of free cash flow for the year. It is very much about timing quarter to quarter. As you pointed out, there are working capital swings that are natural in the business. Those tend to mean that the H2 of the year is better than the H1. But sometimes you have some swings that work in your favor that hit in the same quarter. For Q2, that was true in our day-to-day working capital, and also the timing of distribution from our JVs was favorable. We got a few extra million of that. Really both of those just happen in Q2 rather than Q3.

Speaker #2: It's very much about timing, quarter to quarter. You know, as you pointed out, there are working capital swings that are natural in the business.

Speaker #2: And those were those those tend to mean , you know , that the second half of the year is better than , than the first .

Speaker #2: But sometimes you have some , swings that work in your favor that hit in the same quarter . And so for Q2 , that was true in our in our day to day working capital and also the timing of distributions from our JVs was favorable .

Speaker #2: We got a few extra million of that, and really both of those just kind of happened in Q2 rather than Q3.

Speaker #2: And so we don't really view the year any differently , but we definitely , you know , see the , you know , the performance in Q2 , as indicative of why we guided to that 25 to 30% on a full year basis anyway .

Tony Martin: We do not really view the year any differently, but we definitely see the performance in Q2 as indicative of why we guided to that 25% to 30% on a full year basis anyway. Your question about the CapEx, yeah. $5 million to $7 million a quarter is what we expect to spend. I would say we had more than that in Q2 because we have just been busy in investing in our growth opportunities. We really will continue to do that where the return is there. That may cause us to be at the high end of the range. It would not surprise me if that annual number is more driven by a $7 million a quarter run rate as we get later in the year.

Speaker #2: And , you know , your question about the CapEx . Yep . I mean , 5 to 7 million a quarter is what we expect to spend .

Speaker #2: I'd say , you know , we we had more than that in the second quarter . Because we've just been busy investing in our growth opportunities .

Speaker #2: And we really will continue to do that where the return is there. That may cause us to kind of be at the high end of the range.

Speaker #2: It wouldn't surprise me if that annual number is kind of more driven by, you know, a $7 million a quarter run rate as we get later in the year.

Speaker #2: Because , you know , if we have opportunities to grow , whether it's getting more de novos out of the ground or other spend that , you know , we don't want to tie ourselves too much to some sort of artificial number because we're , you know , we're here to grow and deploy that capital .

Tony Martin: Because if we have opportunities to grow, whether it is getting more de novos out of the ground or other spend that we do not want to tie ourselves too much to some sort of artificial number because we are here to grow and deploy that capital. All that said, within the bounds of the free cash flow guidance we have given, we feel very good about that for the year.

Speaker #2: But , you know , all that said , within the bounds of the free cash flow guidance we've given , you know , we feel very good about that year

Speaker #10: Okay . Then follow up , like you talked about pet in your script , can you just remind us how machines you guys have in your centers and what percent of revenues pet is these days ?

Pito Chickering: Okay. Then follow up, you talked about PET in your script. Can you just remind us how many machines you guys have in your centers and what percent of revenues PET is these days, and how we should think about that role in the next 12 months? Are you taking share from the hospitals? Is it mostly the JVs or fully owned facilities that you are investing in and you are taking share out of? Thank you.

Speaker #10: And how should we think about that role in the next 12 months? And are you taking share from out of the hospitals, and is it mostly the JVs or fully owned facilities that you're investing in or taking share out of?

Speaker #10: Thank you .

Speaker #1: Yes. So, we are very excited by the growth of PET. We have shared that we have eight PET machines in. The goal was to get to 11 this year.

Caitlin Zulla: Yes. We are very excited by the growth of PET. We have shared that we have 8 PET machines, and the goal was to get to 11 this year. We already have 2 open, well on our way. We have focused on there is so much opportunity within MRI and CT, and that is what the business has prioritized over the year. But we do see significant growth opportunity in PET. We expect to see significant growth rate. The 23.2% that we highlighted was before the 2 machines opened in July. We should expect in Q3 that growth rate will continue to go higher. As we think about where are we taking share, PET is one of the more heartbreaking backlogs in so many communities that we are entering into, where we are hearing that patients are waiting weeks, if not months, for their PET exams.

Speaker #1: So we already have two open and well on our way. We have focused on—there’s so much opportunity within MRI and CT, and that’s what the business has prioritized over the years.

Speaker #1: But we do see significant growth opportunity in PET. We expect to see significant growth rates. The 23.2% that we highlighted was before the two machines opened in July.

Speaker #1: So, you should expect in Q3 that the growth rate will continue to go higher as we think about where we are taking share.

Speaker #1: I mean , Pet is one of it is one of the more heartbreaking battles , backlogs in so many communities that we are entering into .

Speaker #1: We're hearing that patients are waiting weeks , if not months for their pet exams . And when you think about what pet does is it helps diagnose oftentimes , you know , life threatening diseases and so whether or not treatment is progressing , treatment is stopping the progression of the disease .

Caitlin Zulla: When you think about what PET does, it helps diagnose oftentimes life-threatening diseases and show whether or not treatment is stopping the progression of the disease. Waiting weeks and months is unacceptable. We are often going into markets where there is a significant backlog. Primarily, obviously patients being seen at hospitals that cannot keep up with the demand. We expect to see continued growth in both our individual consolidated markets, which Arizona is, and that is where one of the additions came, and then also within our joint ventures, the site in South Carolina is in partnership with Atrium. So exciting growth in PET for certainly the quarters to come.

Speaker #1: Waiting , waiting weeks and months is , is , is unacceptable . So we are often going into markets where there is a significant backlog primarily , obviously , patients being seen at hospitals that can't keep up with the demand .

Speaker #1: And so we expect to see continued growth in both our individual , you know , consolidated markets , which Arizona is . And that's where one of the .

Speaker #1: Additions came. And then also, within our joint ventures, you know, the site in South Carolina is in partnership with Atrium.

Speaker #1: So, exciting growth in PET for certainly the quarters to come.

Speaker #3: Thank you . And as a reminder , if you have a question at this time , please press star one one on your telephone .

Operator: Thank you. As a reminder, if you have a question at this time, please press star 1 1 on your telephone. Our next question comes from the line of Matt Mardula from William Blair. Your question, please.

Speaker #3: Our next question comes from the line of Matt Medulla from William Blair. Your question, please.

Speaker #11: Yeah . Hello . This is Matthew on for Ryan Daniels . Thank you so much for taking all the questions . And with advanced imaging being 37.4% of volume , a record for the company , I know one of the company's goals is to increase advanced imaging volume .

Matt Mardula: Yeah, hello, this is Matt on for Ryan Daniels. Thank you so much for taking all the questions. With advanced imaging being 37.4% of volume, a record for the company, I know one of the company's goals is to increase advanced imaging volume, but how should we think about the growth in advanced imaging as a percentage of volume for the rest of the year and maybe into 2027 or longer term? When we are all thinking about the drivers of advanced imaging, it sounds like it is just a good mix of industry trends and company initiatives. Is it more weighted towards one?

Speaker #11: But how should we think about the growth in advanced imaging as a percentage of volume for the rest of the year? And maybe into 2027 or longer term?

Speaker #11: And then just when I'm kind of thinking and we're all thinking about the drivers of events , imaging , it sounds like it's just a good mix of industry trends and company initiatives .

Speaker #11: But is it more weighted towards one?

Speaker #1: Thanks, Matt. Appreciate the question. So yes, we're excited that we were able to have 37.4% of total volume come from advanced.

Caitlin Zulla: Thanks, Matt. Appreciate the question. Yes, excited that we were able to have 37.4% of total volume come from advanced. Notably, that is 111 basis point improvement over Q1 2025. We are not setting a specific target number. We want to grow all parts of our business, but when we have advanced growing more rapidly than routine, obviously the contribution in terms of revenue, advanced is three to four times revenue premium, and that flows through to margin. It is a significant driver of our success and growth. When you think about what is driving advanced, certainly you have got the secular drivers that is radiology, aging population, increasing chronic conditions. You have novel treatment paradigms, and so there is just an increased demand.

Speaker #1: Notably, that's a 111 basis point improvement over Q1 2025. We aren't setting a specific target number; we want to grow all parts of our business.

Speaker #1: But when we have Advanced growing more rapidly than Routine, obviously the contribution in terms of revenue advances three to four times revenue premium, and then that flows through to margin.

Speaker #1: It's a significant driver of our success and growth . And then when you think about what is driving advanced , I mean , certainly you've got the secular drivers that is radiology .

Speaker #1: You know , aging population increasing chronic conditions . You have novel treatment paradigms . And so there's just an increased demand . But we are doing everything we can to make sure we are capturing our fair share And growing at a pace exceeding the industry .

Caitlin Zulla: We are doing everything we can to make sure we are capturing our fair share, and growing at a pace exceeding the industry. That starts with how we are positioning our sales team. We have highlighted that we have over 120 representatives in the market selling for our value proposition all day, every day. It also goes to how we are structuring our operations to continue to expand capacity. Things like Fast Scan that we are on track to get to two-thirds of our MRI suite equipped with Fast Scan or virtual MRI that we are continuing to roll out to help make sure that if techs happen to call out, we are able to continue to run the machine.

Speaker #1: And so that starts with how we're positioning our sales team . We've highlighted that we have over 120 representatives in the market selling to our value proposition all day , every day , you know , and then it also goes to how we're structuring our operations to continue to expand the capacity .

Speaker #1: You know , things like fast scan that we're on track to get to two thirds of Emily MRI equipped with fast or virtual MRI that we're continuing to roll out to help make sure that , you know , if tests happen to call out , we're able to continue to run the machines .

Speaker #1: So continuing to focus on the capacity . And then , of course , you know , really targeting , where do we where do we open our new de novo sites , all based on where we see supply demand mismatch in the geography and opportunity to serve the population that is that does not have ample access to advanced imaging .

Caitlin Zulla: Continuing to focus on the capacity, and of course, really targeting where do we open our new de novo sites, all based on where we see supply, demand mismatch in a geography and an opportunity to serve a population that does not have ample access to advanced imaging. Certainly it is exciting to be in an industry that has got strong tailwinds, and we are doing everything we can on a sales and operations perspective to position ourselves for outsized growth.

Speaker #1: So certainly, it's exciting to be in an industry that's got strong tailwinds. And we're doing everything we can, from a sales and operations perspective, to position ourselves for outsized growth.

Speaker #3: Thank you. And our next question comes from the line of Benjamin Rossi from JP. Your question, please.

Operator: Thank you. Our next question comes from the line of Benjamin Rossi from JPMorgan. Your question, please.

Speaker #5: Hey .

Speaker #12: Good afternoon . Thanks for taking my questions . In context of the broader labor tightness for radiologists and text , as you've been working to leverage some of those technologies , you mentioned to expand capacity , are you finding this unlock capacity allows for enough of a backfill to make up for any labor related capacity limitations ?

Benjamin Rossi: Hey, good afternoon. Thanks for taking my questions. In context of the broader labor tightness for radiologists and techs, as you have been working to leverage some of those technologies you mentioned to expand capacity, are you finding this unlocked capacity allows for enough of a backfill to make up for any labor-related capacity limitations? Or are these constraints resulting in backlogs in certain facilities? Just curious on capacity trends during Q2 and how you are managing levels to meet demand.

Speaker #12: Or are these constraints resulting in backlogs in certain facilities? Security capacity trends leading to queues, and how are you managing levels to meet demand?

Speaker #2: Yeah, yeah. That's something we think about all the time. I think I can go first and throw a number or two out there, and then Caitlin can kind of expand with broader context on this, you know?

Tony Martin: Yeah. Something we think about all the time. I think I can go first and throw a number or two out there, then Caitlin can expand for broader context on this. We look at our expense for this as up 5% year-over-year. Our operating expenses from 2025 to 2026. In this kind of inflationary environment that we are in generally in the economy, that feels pretty good. It has been an inflationary type of item for us. That said, there is certainly opportunities to improve that. Caitlin, I know we do a lot to retain and recruit.

Speaker #2: Yeah , we we look at our expense for this as , you know , like it's up 5% year over year or operating expenses From , from 25 to 26 .

Speaker #2: And so , you know , in this kind of inflationary environment that we're in generally in the economy , you know , that that feels pretty , pretty good .

Speaker #2: And , you know , it is kind of has , has kind of been an inflationary type of item for us that , you know , that said , there's , you know , there's , there's certainly opportunities to improve that .

Speaker #2: And Caitlin, I know we do a lot to retain and recruit.

Speaker #1: Yes . Yeah , yeah . So when you're thinking about the 5% that includes obviously free ramp up cost for de novos . And so , you know , comparing against our revenue , there's , you know , expansion upon it .

Caitlin Zulla: Yeah. So Ben, when you are thinking about the 5%, that includes obviously pre-ramp-up costs for de novos. Comparing against our revenue, there is expansion upon it and opportunities to, as revenue continues to grow alongside the expenses, it will grow at higher rate. What are we doing to continue to support? Obviously, I highlighted the Technologist Advancement Academy continuing to grow our own. We have the advantage of being an environment that technologists like to work in compared to hospitals. We are continuing to roll out our virtual MRI solution that allows us to have one tech run multiple machines at one time which allows us to have increased capacity, especially as we are recruiting a tech or somebody is calling out to take care of their family or take PTO. On the radiologist side, this is why we love our three-prong model.

Speaker #1: And opportunities to , as revenue continues to grow alongside the expenses , it'll grow at a higher rate . You know , and then what are we doing to continue to support , you know , obviously , I highlighted the tech Advancement Academy continuing to grow our own .

Speaker #1: You know , we have the advantage of being an environment that technologists like to work in compared to hospitals and , you know , we are continuing to roll out our virtual MRI solution that allows us to have one tech run multiple machines at one time , which allows us to have increased capacity , especially if we've got we're recruiting a tech or somebody calling out to take care of their family or take PTO .

Speaker #1: And then , you know , on the radiologist side , this is why we love kind of our three pronged model . We have a connection .

Caitlin Zulla: We have Connexia, our telerad group, where we continue to recruit and build out the capacity within that entity, our third-party radiologists that we work with in the markets that we serve, and our affiliated physician groups. So between all of that, we are able to come up with the right solutions to support the community growth.

Speaker #1: Our Telluride group, where we continue to recruit and build out the capacity within that entity. Our third-party radiologists that we work with in the markets that we serve.

Speaker #1: And then our affiliated physician groups. So between all of that, we're able to come up with the right solutions to support, you know, the continued growth.

Speaker #12: Great . And I guess as a follow up , I wanted to spend a moment there in connects you . I guess , with that broader commentary regarding industry demand and read turnaround .

Benjamin Rossi: Great. As a follow-up, I wanted to spend a moment there on Connexia. With that broader commentary regarding industry demand and read turnaround, can you give us an update on how you are thinking about that segment? Are you finding that your partners are leaning into this segment more or if it is resonating more with your prospective partners? Thanks.

Speaker #12: Can you give us an update on how you think about that segment? Are you finding that partners are leaning into this segment more, or if it's maybe resonating more with your prospective partners?

Speaker #12: Thanks

Speaker #1: Yes. Ben, often when we're having conversations with our health system partners, the fact that we are bringing an option for the RAD reads to support the outpatient strategy is seen as very attractive and a differentiator in our approach.

Caitlin Zulla: Yes, Ben, often when we are having conversations with our health system partners, the fact that we are bringing an option for the rad read to support the outpatient strategy is seen as very attractive and a differentiator in our approach. There are certainly health systems that have a preference around rad read groups. If they do, we will support what is the most right for the partnership and the local market. But the fact that we are able to provide incremental capacity for our outpatient centers is certainly seen as a positive in the joint venture discussions.

Speaker #1: There are certainly health systems that have a preference around Rad Read. And so, if they do, we will support what is most right for the partnership and the local market.

Speaker #1: But the fact that we are able to provide incremental capacity for outpatient centers is certainly seen as a positive in the joint venture discussions.

Speaker #3: Thank you. This does conclude the question-and-answer session of today's program. I'd like to hand the program back to Katelyn for any further remarks.

Operator: Thank you. This does conclude the question and answer session of today's program. I would like to hand the program back to Caitlin for any further remarks.

Speaker #1: Thank you. I want to close by thanking our team members and radiologists, whose commitment to our mission and to our patients and communities we serve remains the foundation of everything we do. Thank you for your questions today.

Caitlin Zulla: Thank you. I want to close by thanking our team members and radiologists whose commitment to our mission and to our patients and communities we serve remains the foundation of everything we do. Thank you for your questions today. We enter the H2 of 2026 with strong momentum, a growing network of health system partners, and deep confidence in our strategy and our team's ability to execute. We look forward to updating you on our progress in the future. Have a good night.

Speaker #1: We enter the second half of 2026 with strong momentum, a growing network of health system partners, and deep confidence in our strategy and our team's ability to execute.

Speaker #1: We look forward to updating you on our progress in the future. Have a good night.

Speaker #3: Thank you , ladies and gentlemen , for your participation in today's conference . This does conclude the program . You may now disconnect .

Operator: Thank you, ladies and gentlemen, for your participation in today's conference. This does conclude the program. You may now disconnect. Good day.