Good afternoon, and welcome everyone to the Beyond Air Financial Results Call for the Fiscal Quarter and year ended 03/31/2025. At this time, participants are in a listen-only mode. A question and answer session will follow the formal presentation. And now I would like to turn the call over to Corey Davis.

Thank you, operator. Good afternoon, everyone, and thank you for joining us. Today, after the market closed, we issued a press release announcing the operational highlights and financial results for Beyond Air's fourth quarter of fiscal year 2025 ended 03/31/2025. A copy of this press release can be found on our website beyondair.net under the news and events section. Before we begin, I'd like to remind everyone that we will be making comments and various remarks about future expectations, plans, and prospects, which constitute forward-looking statements for purposes of the Safe Harbor provisions under the Private Securities Litigation Reform Act of 1995. Beyond Air cautions that these forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those indicated. We encourage everyone to review the company's filings with the SEC, including, without limitation, the company's most recent Form 10-K and Form 10-Q, which identify specific factors that may cause actual results or events to differ materially from those described in the forward-looking statements. Additionally, this conference call is being recorded and will be available for audio rebroadcast on our website, beyondair.net. Furthermore, the content of this conference call contains time-sensitive information that is accurate only as of the date of the live broadcast, 06/17/2025. Beyond Air undertakes no obligation to revise or update any statements to reflect events or circumstances after the date of this call. With that, I'll turn the call over to Steve Lisi, Chairman and Chief Executive Officer of Beyond Air. Go ahead, Steve.

Thanks, Corey. And good afternoon to everyone. With me here today is Doug Larson, our Chief Financial Officer. We are quite pleased with the progress we've made over the past year. For the fiscal year ended 03/31/2025, we reported a 220% increase in revenue to $3.7 million compared with $1.2 million for the same period last year. All of this growth came from U.S. sales, with the majority coming from hospitals signed during the back half of the year. As a result, we have tremendous revenue growth built in to kick off fiscal year 2026, along with several new growth drivers I will discuss in a moment. With this in mind, we have decided to also announce that we are on track to report revenue of at least $1.7 million for the quarter ending in just two weeks on 06/30/2025, which translates to greater than a 45% sequential quarterly growth and greater than 145% year-over-year growth. In addition, we are providing revenue guidance of $12 million to $16 million for the full fiscal year ending 03/31/2026. This level of projected growth moving forward shows how we are overcoming the barriers to entry in the nitric oxide market and are well on our way to making LungFit PH the market leader. The more customers use LungFit PH, the more confidence grows in the product and our ability to provide top-tier service. This is an exciting time for our team and our shareholders. Let me now dig a little deeper into the numbers for the fiscal fourth quarter of 2025 and growth drivers for fiscal 2026. The commercial team's efforts have led to a steady flow of new hospital contracts throughout fiscal year 2025. During the fourth quarter, we saw three new hospital starts and three hospitals renew their contracts. As I've…

Thanks, Steve, and good afternoon, everyone. Our financial results for the fourth quarter of fiscal year 2025, which ended 03/31/2025, are as follows. Revenue for the fiscal year ended 03/31/2025 increased 20% to $3.7 million compared with $1.2 million for the fiscal year ended 03/31/2024. We're showing a $1.7 million loss in gross profit for the fiscal year 2025 compared to $1.3 million for fiscal year 2024. Cost of revenue of $5.4 million were recognized in the fiscal year compared with $2.5 million in the fiscal year ended 03/31/2024. Cost of revenue exceeded revenue primarily driven by the depreciation of LungFit devices and one-time upgrade costs to systems. Research and development expenses were $16.9 million for fiscal year 2025 compared with $24.4 million for the fiscal year ended 03/31/2024. The decrease of $7.5 million was primarily attributed to a decrease in salaries, stock-based compensation, and to a lesser extent, from clinical and preclinical study SG&A expenses for the year ended 03/31/2025 and 03/31/2024 were $26 million and $37.3 million, respectively. A decrease of $11.3 million was attributed primarily to a reduction in salaries and stock-based compensation costs. Other expense was $3.9 million compared to $1.3 million a year ago. The increase in other expense of $2.6 million was mainly due to a non-cash loss recorded upon the retirement of Avenue Capital debt. Net loss attributed to common stock of Beyond Air Inc was $46.6 million or a loss of 69¢ per share basic and diluted. Our net loss for the fiscal year ended 03/31/2024 was $60.2 million or a loss of $1.82 per share basic and diluted. Net cash burn for the year was $44.1 million, which is more than 28% lower than the previous year. We've talked in previous quarters about how we've been laser-focused on fixed cost reduction…

Thanks, Doug. We'll now take some questions. Operator?

Thank you. We'll now be conducting a question and answer session. If you would like to ask a question, please press 1 on your telephone keypad. Participants using speaker equipment may be necessary to pick up your handset before pressing the star key. One moment, while we poll for questions. Our first question is from Marie Thibault with BTIG.

Hi, good afternoon, and congrats on the progress here. Wanted to ask my first question here about LungFit 2.0. Great to see that get in. Wanted to understand if that system approval is being assumed in the fiscal year 26 guidance range that you've given us and how we should think about the selling dynamics ahead of that potential approval. Is that something where hospitals see that coming approval and say, hey, I want to get exposure to LungFit before that comes out? Is it, you know, they wait a little bit as they're waiting for that gen system? Help us think about some of those dynamics.

Thanks, Marie. Fiscal '26 guidance does not include the second-generation system at all. And to answer your other question, you know, we don't promote the gen two, obviously, until we get approval. So people know it exists, obviously, and they do inquire. But I think it's, you know, the focus is on gen one. That's what we're promoting now, and that's what we're marketing and pushing. And yeah, I mean, obviously, there are some hospitals that are getting exposure to gen one immediately, and then there are others who will choose to wait. So we've seen both at this point.

Okay. Very encouraging. Very helpful, Steve. I want to ask also about OUS. You've, you know, gotten several shipments out there. It sounds like, of units. What are we understanding about what some of those contracts look like? Is there any difference in how hospitals use this versus how they use it within U.S. hospitals? Any trends or specific countries we should be looking toward or any other catalyst OUS? Just want to get a little closer to that market.

Yeah, I think it's a little early for us to see any trends in actual hospitals outside the U.S. Right now, our shipments are initial shipments to distributors. And they're taking those and using them for demonstration to get interest to have hospital placements. And there's a much more tender process outside the United States than in the U.S., so it takes a little bit longer to get into the hospitals. So I think the back half of this fiscal year, we'll see a big upswing on the international side as we get hospital placements, and we'll get some trends at that point. But our initial work in the market outside the U.S. is showing, you know, consistency in terms of how they use nitric oxide. You know, outside the U.S., cardiac surgery is on label. So they're definitely using it in that area. But again, it's similar to how it's used in the United States.

Okay. Very helpful updates. Thanks a lot, Steve.

Thanks, Marie.

Thank you. Our next question is from Jason Wittes with ROTH Capital.

Hi. Thanks for taking the questions, and congrats on the progress here. On the PMA submission, do you have an expected timeline for when we may see an approval for that for that for LungFit PH2?

Jason, did you ask me when FDA is gonna approve?

I just do you have an estimate is what I'm asking? And I guess I was I'd add to that, how should we think about a potential launch? It's think you had indicated earlier that it's kind of stage launch versus an immediate bolus type. Just curious about the dynamics around what we might expect when the FDA approves this device.

Okay. So, yeah, I'm gonna stay away from the exact timing on an FDA approval. I mean, you know, everybody kinda knows what's going on at FDA right now. There's a little bit of an upheaval. Let's just kinda let things settle in. It'll take a few months for us to interact with FDA and get a better understanding of their questions on our application. And, you know, perhaps, you know, I can give some more timelines or better guidance on timing at that moment in time. But as for the launch for Gen two, you know, obviously, we're gonna prep for that as we work with FDA. There's always a period where you need to build up inventory and you need to scale up your manufacturing. So it will take a couple of months and then we will try to keep up with demand. That'll probably be the challenge that we have post-approval.

Okay. That's fair. That's a totally appropriate answer. I get it. And then, you know, appreciate the guidance, which looks quite strong. We're at the low end. There's a big range there. I mean, what has to happen to get towards the higher end of that range for the $12 to $16 million that you're kind of hinting or pointing to for 2026?

Yeah. It's not really that big of a range. I mean, $4 million range. I guess it seems that way because it's a small, you know, $12 to $16. It's not a 100 to a 104. Percentage-wise, certainly, but dollar-wise, you know, go ahead. You know, I mean, you know, you can get a couple of contracts that are a good size, and it can move you a few million dollars. You know, we can get some approvals, regulatory approvals overseas for some big countries and get some big orders in. So, you know, it's not to us, it's not that big of a range because things can swing dramatically with some of the things that we have going on in the pipeline. So, you know, that's kinda how we view it. We feel pretty comfortable getting to There's too many moving parts and it's only June. So it's exciting for us.

Got it. That's helpful. And then, maybe just another clarification. On did I hear correctly? So, basically, on the expense line, there'll be further reductions until expected through September, and then you basically grow with revenues. And on the expense line, is that the right way to think about modeling the P&L?

Yes, exactly.

Okay. That's all I got. Thanks, and congrats on the PMA submission.

Thanks, Jason.

Our next question is from Justin Walsh with Jones Trading.

Hi. Thanks for taking the question. And now you guys are supplying globally, I was wondering, I guess, the degree to which you're seeing impacts or worried about impacts from some of the emerging geopolitical questions. I mean, we have a moving target with U.S. tariffs. And you mentioned that you're supplying to Ukraine and, of course, you have ties in Israel. So just curious how all of that is impacting things or not.

You know, I don't think it's impacting us that much. I mean, we manufacture in the United States for LungFit. So the vast majority of our costs are in the U.S. We do source some parts from outside the U.S. But it's not a major impact if those tariffs and some of the big ones are going to stay in place. It's a low single-digit percentage impact on our cost of goods. So it's not a major impact on us. And on the reverse side, we haven't really seen anything about where we're shipping to in terms of tariffs on the other end at this point. And as for Israel and Ukraine, I mean, honestly, it wasn't, you know, Israel's great to be in. It's not a large country. But it will impact our ex-U.S. sales. We're very happy to be there. But I don't think it's a major driver like a France or a Turkey. Or an Australia, India, you know, these are much bigger countries where we are. And to be honest, we were very surprised and happy that the distributor that we're working with in Eastern Europe had Ukraine on their list. So we're very excited to be able to help the distributor there going to Ukraine, but we didn't have any expectations for that. So that's just upside.

Great. And maybe just a follow-up on that. I'm curious if you're seeing more uptake in some of those or where you think some of the markets might be a little bigger? I mean, obviously, you just mentioned a couple of them, but I'm wondering if you really think you'll take off in India or somewhere in particular.

Yeah. I mean, it depends. Like, they're all different in terms of timing. So India, we have a partner, but there's a regulatory process to go through. So the impact from India on this fiscal year will be minimal. And, you know, some of the other countries where, like Australia, Thailand, France, Romania, Turkey. These places, the regulatory process is already done or a very short time. So we'll get some more impact from them. But it's like I said earlier, an early question, it's a little too early. Because there are tender processes in a lot of these countries, so it takes time to get in. To some hospitals. So we're gonna wait the next, you know, three, four, five months to see how those go and how many we get and how quickly we get in. And every country is different, so this is new for us. As a company and new for this product. Even our international team who has experience with this, this is a new product. I mean, no one's ever seen a non-cylinder-based nitric oxide system outside the United States before. And, certainly not one that makes it from ambient air. So this is kind of new for everybody, and we have some distributors who are extremely excited, jumped at the opportunity, and it was a very quick process to sign them up. And others are a little more skeptical. I think because

Our next question is from Yale Jen with Laidlaw and Company.

Good afternoon, and thanks for taking the questions. And congrats on the guidance as well as the performance. We just got about three here. The first one is that you suggest that you will have more than $1.7 million for the next quarter or current ongoing quarters, actually. And $12 to $16 million for the fiscal 26. So what's the confidence you can provide behind these forecasts or projections? And I have a follow-up.

Thanks, Yale. I mean, we're pretty confident. We wouldn't have put it out if we weren't. I think the fact that June ends in two weeks, we're pretty confident it'll be $1.7 million. You know, it could be something that happens in the next two weeks to bump it up a bit. We can't really predict that. But we're highly confident in that number. And, as for the fiscal year, we're pretty confident. I mean, we've got a lot in the hopper here. Especially on the international side. Even in the U.S., there's movement in some areas that, you know, we're excited to see and maybe happening a little bit sooner than we thought. So I'll give you an example. You know, we're very flexible with the customers and how they want to structure their contracts. It's very easy with our system to be as flexible as they would like us to be. But one of the things we started offering earlier this year is the Razer Razer Blade model. So the purchase of our system and then the ongoing purchase of the consumables, which is mainly the filter. And we've gotten some good feedback over the last month or two on that model. So we may actually see some hospitals jumping at the opportunity for that rather than the more traditional nitric oxide model, which is how many hours do you use, x amount, this is what your annual cost could be divided by 12, and you get paid that per month. That's really the main way it's done, but we're offering this other way of doing it with the purchase model. And, you know, we may see some of that in this fiscal year, and that's exciting. And that gives us some confidence in our numbers because it wasn't something we were seeing six to nine months ago at all.

Okay. Great. That's very helpful and confident. And also, in the press release, you mentioned you have about 45 in the United States now either installed or actually as well as using the LungFit systems. And so going toward, let's say, the end of this year, fiscal maybe or if the calendar year is of this end of this year. Do you anticipate what might be the estimate or projection of the number of hospitals that you may have as well as maybe whether you would also see the volume increase per hospital?

You know, I definitely see the volume increasing per hospital. We've been seeing that for the past year and a half. A lot of our hospitals are going over what their estimate was for the year. That's a good thing. You know, we do offer a discounted hourly rate if they go over. So certainty of price is important for the customer. So I think that may continue. Hopefully, hospitals can get a bit, you know, with us and get a better handle on what they're gonna use for the year. So there's certainty in what they're spending. I don't want to speculate on the total number of hospitals we're going to have at the end of the fiscal year. While it's important, while it's important, you know, not every hospital is created equal. So some hospitals are small in terms of their volume, and some are very large in terms of their volume. So we could have one hospital be worth 10 in some cases. So obviously, 45 is a great number. I certainly see it being significantly more than that number at the end of the fiscal year. But, I'm not gonna take a guess and try to triangulate that exact number right now, Yale. But thank you.

Okay. Great. And maybe just squeeze in one more question. So, follow-up the earlier one. That for the PMA applications, I know this is difficult to predict the timing to possible approval. For a possible approval. But just let's assume or maybe if in the normal quote-unquote, normal circumstances, would this process maybe take about twelve months to sixteen months or shorter? Just curious. What will be the reference point we can at least think about? And thanks.

Yeah. So there are statistics that FDA puts out about PMAs and PM this is a PMA supplement. So FDA puts statistics out about how long these things take so you can see them online. I just caution you to take these averages because not every PMA is created equal. You know, we are just a supplement. You know, we've generation system. Basically make nitric oxide the same way as our with our second-generation system as our first generation. A lot of the things that we do are equivalent. It's obviously smaller. It obviously has some enhanced features. And it obviously is built to be used for ambulances and helicopters and airplanes. So there are some differences, but from how it operates, it's really not that much different. So could we be quicker than the average that FDA puts out? Probably. But, again, if you look at FDA's guidelines, it's a hundred and eighty days. For a PMA supplement. And they normally do not hit that hundred and eighty days. And it's not that they can't hit their timelines. A lot of times, they have questions. And that clock will stop. While you're having discussions with FDA. So that's something that companies don't control, FDA does, and we're gonna work with them. Get this done as quickly as possible. But I just don't know what that timeline will be. At this point, we'll have a better handle once we start discussions with FDA in the next couple of months.

Great. That's a lot of great colors on the story. And, again, congrats and thanks for taking the question.

Thanks, Yale.

Our next question is from Jason Bednar with Piper Sandler.

Hey, guys. Thanks for taking the questions. Is Joe Downing on for Jason. Congrats on the PMA submission. Just wondering if there's any difference you can call out in the sales process with the 2.0 device versus the 1.0 device. And then just off of that, can you just remind us how much this LungFit 2.0 expands the market?

So, Joe, thanks for the questions. I mean, we're not trying to sell this gen two or market the gen two right now, so we're not gonna comment on how the process is different because we don't have a process yet. We have to wait for approval on that. But as for how it opens the market, I mean, it vastly expands this market. It opens it up for us as a company to every hospital in the world that wants to use nitric oxide. Can get it anywhere. Our gen one is already in remote locations treating patients. So the gen two, it'll be even easier. To do that. So this is something that will change the way people use nitric oxide in the hospital. I think that it will increase volumes overall and, again, reach hospitals that don't use nitric right now. So this is a for us, I think, and for the industry, it's a game changer. It really is.

Great. Thanks, Steve. Appreciate that. And then just one last one on the competitive landscape. Your largest peer put out a new offering a number of months ago. Just wondering if you're seeing anything worth calling out with contract negotiations with hospitals as a result of that launch?

Which one are you talking about?

Mallinckrodt.

Oh, the Mallinckrodt offering? You know, we haven't seen a change. I mean, the contracts are usually one, three, and five years. This market. We haven't really seen any change in that. So at least my team and I haven't really seen much change. Yes. They're out there with their new offering and, you know, they're marketing it for sure. And I see I think they, last time they spoke, they gave an idea of how many hospitals they were in or something or that they were in hospitals. So you can take a look at what their transcript said. So, yeah, it's another competitor. It's another cylinder-based system. Out there. That's the fourth cylinder-based system in the United States.

Great. Thanks, Steve. Appreciate it.

Yep. Thanks, Joe.

At this time, we're showing no further questions in queue. This does conclude our question and answer session. I would now like to turn the call back over to Steve Lisi for any closing remarks.

Just like to thank everybody for joining us today. And, we'll talk to you in August. Thank you.

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