Greetings and welcome to the Ekso Bionics' First Quarter 2018 Financial Results Conference Call. As a reminder, this conference is being recorded. For opening remarks, I will now turn the call over to David Carey of Lazar Partners. Thank you, David. You may begin.

Thank you, Devin and thank you all for participating in today's call. Joining me from Ekso Bionics are Jack Peurach, President and Chief Executive Officer and Max Scheder-Bieschin, Chief Financial Officer. Earlier today, Ekso Bionics released financial results for the quarter ended March 31, 2018. A copy of the press release is available in the company's website. Before we begin, I would like to remind you that management will make statements during this call that include forward-looking statements within the meaning of federal securities laws which are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Any statements contained in this call that are not statements of historical facts should be deemed to be constitute forward-looking statements. All forward-looking statements, including without limitation are examination of historical operating trends and our future financial or operational expectations are based upon management's current estimates and various assumptions. These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated or implied by those forward-looking statements. Accordingly, you should not place undue reliance on these statements. For a list and description of the risks and uncertainties associated with our business, please see our filings with the Securities and Exchange Commission. Ekso disclaims any intention or obligation except as required by law to update or revise any financial or operational projections or other forward-looking statements, whether because of new information, future events or otherwise. This conference call contains time-sensitive information and is accurate only as of the broadcast today, May 7, 2018. I will now turn the call over to Jack Peurach. Jack?

Thanks, David and thanks to all of you for participating in today's call. Since becoming CEO of Ekso Bionics almost two months ago, I've been inspired by the focus and dedication of our leadership team and all of our employees to realize the potential of our innovative products and technologies. The power of that focus is reflected in the achievements we made in the first quarter of 2018. I am pleased with our revenue growth and unit adoption in the rehabilitation market in the United States and the EMEA, both year-over-year and quarter-over-quarter. Our total revenues of $2.5 million for the first quarter of 2018 is a 75% increase over the same quarter in 2017. And our shipment of 24 EksoGT systems in the first quarter of 2018 is over 160% increase compared with the same period in the prior year. This is the first time we achieved revenue of over $2 million in our rehabilitation business. Of the 24 EksoGT systems shipped in the first quarter, 13 new units were sold and 11 new units were added to our rental fleet. This demonstrates the traction our rental program is gaining in the US market. This program is helping to drive adoption of EksoGT, as evidenced by the four rental units that converted to sales in the first quarter. We will certainly have to be diligent in our efforts to convert rentals to sales or long term leases. However, while still early days, I believe that the program will continue to drive customers to make a long term commitment to a product that we believe is transforming the rehabilitation landscape. The 23 rentals we have in the field represent over $2.5 million in potential sales. We continue to build a robust body of clinical data that we believe demonstrate the…

Thanks, Jack for those very kind words. My decision to step away from Ekso was one of the most difficult choices I've ever made, especially as I believe we are getting real traction in both the rehabilitation and industrial markets. I am pleased to have at least one more opportunity to review our financial results with you today. Total reported revenue was $2.5 million for the first quarter ended March 31, 2018. This breaks down to $2.1 million in the EksoGT and related revenue and $400,000 in industrial sales. We'd like to note again that this is the first time we exceeded $2 million for our rehabilitation business, with both North America and Europe contributing to the growth. In addition, we see that our rental programs continue to resonate with customers, which continues to help accelerate adoption. Our rental fleet grew to 23 rental units at the end of March 2018. This represents a potential of close to $2.5 million in future revenues. Gross profit for the quarter was $800,000 compared to $400,000 for the same period in 2017. We expect gross margins for our rehab business to continue to strengthen, as the year progresses, as implemented changes to our service business and cost of good reductions take effect. Sales and marketing expenses for the quarter were $3.9 million, compared to $3.1 million for the first quarter 2017. With some organizational changes we made earlier this quarter, we see the run rate for the second half of the year to be about $750,000 less per quarter than this past quarter. Research and development expenses for the quarter were $1.8 million compared to $2.9 million for the first quarter 2017, a decrease due to our reduction in workforce in May 2017. General and administrative expenses for the quarter were $3.7 million…

Thanks, Max. I guess there's nothing like going out on a high note. A 75% increase in revenue over the same quarter last year. The first time we hit $2 million in a rehab business and the first time we go into backlog in all of our businesses are notable achievements. But as I said a few minutes ago, I'm more focused on the future than the quarter we just completed. Going forward, there will be a continued focus on gaining operational efficiencies that will allow us to achieve significant and profitable growth for what is a large market opportunity for our technology without compromising our ability to deliver on the hope that we promise to our customers and to the patients they serve, hitting our stride is the best way to help the end users of our products hit theirs. Operator, you may now open the line for questions.

[Operator Instructions] Our first question comes from the line of Bruce Nudell with SunTrust.

Hi. This is Stan Fediuk on the line for Bruce Nudell. Thank you for taking my questions. First, can you just provide more color on the unit trends in the quarter? In medical, there were higher rental units. How should we think about the unit trends going forward?

Hi, Stan. This is Max. Thanks for being on the call and for the questions, since that's financial oriented. So of the 24 units that we shipped this quarter, we can tell you that 14 of those were in the United States. 10 of those were in EMEA. And of the 14, 11 were net new rentals, 10 in the United States, one in EMEA. And I think in terms of the trends, EMEA is a direct and an indirect market, mostly indirect and you'll see mostly sales to our distributor partners on that front. And in the United States, you should continue to see an equal weighting as we're experienced this quarter and started to experience last quarter between rental and sales. It will be lumpy from quarter-to-quarter, but we think the rental program is really what's driving significant increase in adoption. And as long as we keep really good conversion rates on those rentals and we're eyeing that very carefully, I think it's going to be a good opportunity to accelerate the sales cycle.

Okay. In industrial, what was the split between vests and mounts?

We shipped 75 units in the industrial space, 36 units were mounts, 39 were vests.

Okay. Great. And is there any update with the JV in China?

Hey, Stan. We are continuing to press forward with that. We're extremely excited about the opportunity in China, both downstream and for operationally for the cost of our product. As of today, we've not made any final decisions or final agreements with partners, but that work is underway. When we do have something to announce, we will do it.

Is there - do you know what the potential size of the Chinese market for medical is?

The rehabilitation - for rehabilitation applications, the market is significant. It's also quite immature. So it's very difficult to size it properly, but it's quite significant in order of multiples the size of the US market.

To give you a sense, Stan, it's 800,000 stroke every year in the United States. There's a - as Jack said, it's very immature market, but we estimate it's 10x the size in terms of number of strokes.

Okay. And can you provide some additional details on the license agreement in Japan?

Sure. It's a - Daydo has an exclusive agreement to use our technology in the new home construction market in Japan. They have a distribution agreement to distribute our products in the new home market and in the broader Japan market. That is a nonexclusive agreement. And we have the opportunity to, if they develop products that we find useful outside of that market, we can bring those products into our markets, outside of Japan.

They're going to be paying us a royalty rate as well, but that's not been disclosed.

Okay. And then - I think that's it for my questions and also Max, I just also want to wish you all the best.

Thanks very much, Stan.

Thank you. We have reached the end of our allotted time for questions. I would like to turn the floor back over to Mr. Peurach for closing comments.

Thank you all for joining us today. I think our first quarter results really demonstrate the momentum and I believe that we are in a trajectory toward realizing the true clinical and commercial value of our products. I also believe that there is significant value to be gained from investing in innovation and continuing to lead the charge in protecting, restoring and improving human mobility. I'm excited to capture the opportunities that exist in the markets for our current products and we are committed to identifying and creating new opportunities that will radically increase the value we can provide to our patients, workers and customers.

This concludes today's teleconference. You may now disconnect your lines at this time. Thank you for your participation.