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Edap Tms S.a. misses on earnings expectations. Reported EPS is $-0.24 EPS, expectations were $-0.22.

Operator: Greetings, and welcome to the EDAP TMS First Quarter 2026 Conference Call. As a reminder, this conference call is being recorded. I would now like to turn the call over to Louisa Smith from Gilmartin Group. Please go ahead.

Louisa Smith: Good morning. Thank you for joining us for the EDAP TMS First Quarter 2026 Financial and Operating Results Conference Call. Joining me on today’s call are Ryan Rhodes, Chief Executive Officer; Ken Mobeck, Chief Financial Officer; and Francois Dietsch, Chief Accounting Officer. Before we begin, I would like to remind everyone that management’s remarks today may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management’s current expectations and involve risks and uncertainties that could cause actual results to differ materially from those anticipated. We direct you to the Risk Factors section of our most recently filed annual report on Form 10-K for the year ended December 31, 2025, as filed with the Securities and Exchange Commission as well as our other filings with the SEC for a description of factors that may cause such differences.

These statements speak only as of today’s date, and we undertake no obligation to update or revise them, except as required by law. Additionally, this call is being recorded and constitutes a public disclosure for purposes of Regulation FD. I would now like to turn the call over to Chief Executive Officer, Ryan Rhodes.

Ryan Rhodes: Thank you, Louisa, and good morning, everyone. As announced this morning, we delivered a strong first quarter. We reported record first quarter total revenue for the company of $17.8 million, led by record first quarter Focal One Robotic HIFU revenue of $11.6 million, further reinforcing the momentum we highlighted on our previous fourth quarter call. Today, I will provide additional color on new system placements, growing utilization trends and our ongoing indication expansion efforts before turning the call over to Ken to review our financial results. Before discussing the quarter in more detail, I would like to remind everyone that effective January 1 of this year, EDAP becomes a U.S. domestic issuer. As a result, beginning this quarter, we will report all financial results in U.S. dollars on a go-forward basis.

Now turning to our first quarter results. Our HIFU business continues to demonstrate strong and sustained momentum. We have now delivered 7 consecutive quarters of year-over-year growth in this segment, reflecting increasing physician adoption, expanding utilization and growing global demand for Focal One Robotic HIFU technology. We delivered record revenue across our core HIFU business driven by strong growth in both system placements and procedure volumes across U.S. and international markets. During the quarter, we recorded 11 capital sales and 10 total net placements, further reinforcing the strength and growing visibility of our Focal One pipeline. In the quarter, we continued to expand adoption across many of the most prestigious academic cancer centers in the United States.

As noted, University of Pittsburgh Medical Center, UPMC, converted to a cash sale and Moffitt Cancer Center became the 10th Focal One system installed in the state of Florida. These placements further validate Focal One’s emergence as a leading robotic focal therapy platform being adopted and utilized by top-ranked institutions nationwide. We also placed a second Focal One system within the Mass General Brigham Healthcare Network. With this addition, 11 U.S. hospital and health networks have now invested in and launched 2 or more Focal One robotic HIFU programs, underscoring the growing utilization, confidence and long-term commitment we are seeing from major health care systems. Internationally, we achieved a record 6 capital sales in the first quarter, reflecting the continued expansion of our global commercial reach, supported by our established and growing sales channel infrastructure.

Performance in Europe was particularly strong. In France, we completed our first cash sale following the French National Health System’s decision to provide universal coverage for the Focal One HIFU procedure. As a reminder, this coverage decision was supported by results from the landmark HIFI study, a large prospective comparative trial that demonstrated positive efficacy outcomes for Focal One robotic HIFU as compared with radical prostatectomy in the treatment of prostate cancer. This quarter also marked the first time our Focal One capital sales were driven by demand across 2 clinical indications, prostate cancer and deep infiltrating endometriosis. Further highlighting the value of Focal One as both a multi-specialty and multi-indication treatment platform.

In the United Kingdom, Cleveland Clinic London converted to a cash sale supported by strong engagement from global thought leaders in both urology and gynecology departments, which plan to utilize Focal One Robotic HIFU for the treatment of both prostate cancer and endometriosis. In Eastern Europe, we achieved our first Focal One cash sale in Hungary, driven by the hospital’s strategic initiative to expand treatment capabilities for both prostate cancer and endometriosis. These placements are important as they recognize Focal One robotic HIFU as the only multi-indication focal therapy platform to deliver broad clinical utility across both men’s and women’s health. In the Americas, we delivered our first Focal One system in Mexico, further expanding our growing clinical regional footprint, which now includes Brazil, Argentina, Chile, Panama and Mexico.

This is a result of our growing and expanding sales channel throughout this region. Turning to utilization. U.S. procedure volumes increased 53% year-over-year. This significant growth was driven by physicians and hospital systems that increasingly recognize the importance of offering Focal One as a cornerstone focal therapy treatment within a comprehensive prostate cancer program. As we continue to expand the clinical applications of Focal One Robotic HIFU and bring meaningful value to a broader population of prostate cancer patients, we also remain focused on the significant unmet need in patients who experience recurrence following failed radiation therapy. Radiation therapy failure rates reported in the clinical literature remains significant and treatment options for these patients are extremely limited, often consisting primarily of hormone deprivation therapy, which can carry debilitating long-lasting side effects that materially impact the patient’s quality of life.

Our recent announcement regarding the peer-reviewed publication of the HIFI-2 study further strengthens our global leadership position in focal therapy. This study is significant for several reasons. First, it represents the largest prospective study ever conducted, enrolling more than 500 patients evaluating salvage treatment following recurrence after failed radiation therapy. Second, HIFI-2 is the largest prospective study assessing the use of Focal One robotic HIFU within this important patient population. Importantly, the study demonstrated clinically meaningful oncologic control with 71% of the overall patient population avoiding hormone deprivation therapy at 30 months. Additionally, in a rigorously selected subgroup of patients, 84% avoided hormone deprivation therapy within the same follow-up time period.

These positive results show promise for use of Focal One HIFU as a breakthrough treatment for this important population of men who have previously been left with limited options that result in negative long-lasting side effects. It is also important to note that the National Comprehensive Cancer Network guidelines already recommend HIFU as a treatment option for patients with prostate cancer recurrence following failed radiation therapy, and both Medicare and commercial payers currently provide reimbursement coverage for the use of Focal One robotic HIFU in this clinical setting. In summary, the publication of the HIFI 2 study further reinforces Focal One’s unique position as a noninvasive organ-sparing and function-preserving treatment option for a patient population that has historically faced limited therapeutic alternatives beyond palliative care.

In urology and moving beyond prostate cancer, we continue to invest in expanded clinical indications for Focal One. We are currently accelerating clinical studies evaluating the use of Focal One for the treatment of benign prostatic hyperplasia or BPH. In early March, our clinical team collaborated with urologists from the New York Icahn School of Medicine at Mount Sinai to treat patients in Chile as part of an ongoing clinical research study. Based on encouraging early outcomes, the trial will continue with plans to enroll and to treat a second cohort of patients over the coming months. In addition, a separate IRB-approved study will be conducted at Mount Sinai in New York following patient evaluations from the Chile study. Together, these initiatives reflect our broader strategy to expand the clinical utility of Focal One and to further strengthen the body of evidence supporting its expanded use across additional urologic applications.

Within gynecology, our commercial rollout in endometriosis continues to gain momentum across Europe. As mentioned earlier, multiple hospitals have now invested in Focal One Robotic HIFU to support the treatment of both prostate cancer and endometriosis, reinforcing the platform’s growing multi-specialty clinical utility. During the quarter, we actively participated in 2 major scientific meetings, the European Endometriosis Congress and the British Society for Gynecological Endoscopy Annual Scientific Meeting. Our Focal One sponsored symposium at the European Endometriosis Congress in Bologna, Italy, attracted more than 400 attendees and generated strong engagement from leading clinicians and specialists across key international markets. On the clinical front, Croix-Rousse Hospital in Lyon, France remains central to our expansion strategy, serving both as a high-volume treatment center and as our primary physician training hub for endometriosis.

In parallel, Focal One robotic HIFU endometriosis programs are beginning to launch and enroll patients. We are pleased to confirm that first patient treatments at several newly established clinical centers are expected to begin in the coming weeks, representing an important milestone as these programs transition from physician training into active clinical adoption. At these recent scientific meetings, investigators also presented positive long-term follow-up data from the Phase II and Phase III randomized controlled trial, demonstrating effective and durable outcomes that remain consistent across all patient cohorts. These findings further reinforce our confidence in the long-term clinical value of this treatment approach. Importantly, we believe the growing body of clinical evidence establishes a strong foundation to support the advancement along the regulatory pathway.

Collectively, these commercial and clinical developments further strengthen our conviction that endometriosis represents a significant long-term growth opportunity for Focal One. As we mentioned on our last call in March, we collaborated with the leadership team from the NYU Langone Department of Urology to host the inaugural International Symposium on Robotic Focal therapy in New York City. This event attracted physicians from both the U.S. and international markets who are either developing or actively evaluating focal therapy programs centered around Focal One Robotic HIFU. The strong attendance and overall success of this educational program further highlights the growing momentum we continue to see throughout the global urology community.

Building on the success of the NYU symposium and in response to increasing demand from urologists seeking to integrate Focal One technology into their practices, we will be sponsoring a CME accredited physician training course at Memorial Sloan Kettering Cancer Center on Thursday, May 14. MSKCC is ranked as the leading urology-focused comprehensive cancer center in the United States and is a leading and highly experienced user of Focal One robotic HIFU globally. Looking ahead, we will deliver a strong presence at the upcoming Annual Meeting of the American Urological Association in Washington, D.C. starting on May 15. The AUA meeting represents the largest global gathering of urologists and serves as a premier forum where the latest advances in urology are presented and translated into clinical practice.

Throughout the conference, we will host multiple educational and clinical engagement activities, including booth presentations, semi-live Focal One procedures, panel discussions and hands-on Focal One simulation sessions led by key clinical thought leaders. In addition, we will be hosting numerous analyst and investor meetings throughout the scientific program. And finally, we are excited to announce that we will host an Investor Day on June 1 at the NASDAQ MarketSite in New York City. During this event, we will provide important updates on our commercial growth strategy, clinical indication expansion and product innovation road map as we continue to build increased momentum across our business. We believe the opportunity ahead of us has never been greater, and we look forward to sharing our vision for the next phase of growth.

We hope you will join us in New York. With that, I would now like to turn the call over to Ken to review our financial results.

Ken Mobeck: Thank you, Ryan, and good morning, everyone. As a reminder, all figures will now be reported in U.S. dollars. As Ryan mentioned earlier, our record revenue performance for the first quarter of 2026 was driven by continued strength in our core HIFU business, which grew 78% compared to the first quarter of 2025. Growth in our HIFU business was partially offset by expected continued decline in our noncore distribution and ESWL businesses, which declined by 20% in Q1 2026 versus Q1 2025. Total company-wide revenue for the first quarter was $17.8 million, an increase of 25% as compared to total revenue of $14.3 million for the same period in 2025. Total HIFU revenue for the first quarter was $11.6 million as compared to $6.5 million for the first quarter of 2025.

The 78% year-over-year increase in HIFU revenue was driven by 11 Focal One capital sales in the first quarter of 2026 versus 6 capital sales in the prior year period as well as a 30% year-over-year increase in Focal One treatment-driven revenue. As mentioned earlier, Focal One procedures in the U.S. grew 53% year-over-year. Gross profit for the first quarter was $8.1 million compared to $6 million for the prior year period. Gross margin was 45.7% in the first quarter compared to 42% for the first quarter of 2025. The 370 basis points increase in gross margin year-over-year was primarily due to the strategic shift to our higher-margin HIFU business segment, which had gross margins of 51.4% for the first quarter compared to 48.6% for the first quarter of 2025.

Operating expenses were $15.5 million for the first quarter compared to $12.3 million for the same period in 2025. The increase in operating expenses was driven by higher sales expense related to increased system sales as well as incremental costs associated with our transition to a U.S. domestic filer. Operating loss for the first quarter was $7.4 million as compared to $6.3 million in the first quarter of 2025. Net loss for the first quarter was $9.1 million or $0.24 per share as compared to a net loss of $7.4 million or $0.20 per share in the prior year period. The increase in net loss was driven by incremental operating loss of $1.1 million as well as a $1.7 million non-cash charge related to warrants and interest expense on the European Investment Bank Cante drawdown.

This was partially offset by $1.1 million positive currency impact versus the prior year period. Turning to the balance sheet. Inventory increased $13.3 million at the end of the first quarter as compared to $12.8 million at the end of Q4 2025. This sequential increase in inventory was due to a higher level of HIFU-related inventory to meet the increased demand for Focal One systems as our business momentum continues to grow. Cash and cash equivalents at the end of the first quarter were $15 million compared to $20.5 million at the end of Q4 2025. The sequential decrease was driven primarily by cash used in operating activities to support our strategic investments in accelerating HIFU growth. Subsequent to the end of the first quarter, on April 20, we received the second tranche from the European Investment Bank credit facility totaling approximately $14 million, which will further strengthen our balance sheet and will be reflected in our Q2 financial statements.

The tariff impact on the first quarter P&L and balance sheet was approximately $400,000. We are reiterating our full year 2026 guidance. We continue to expect core HIFU revenue in the range of $50 million to $54 million, representing 34% to 45% growth over 2025 and combined noncore revenue in the range of $22 million to $26 million. I will now turn it back to Ryan for closing remarks. Ryan?

Ryan Rhodes: Thanks, Ken. As we execute through 2026, our priorities remain clear: commercial execution and continuing to deepen penetration across leading centers, indication expansion and advancing our endometriosis and BPH programs, technology and innovation positioning Focal One as a leader in the space with the most advanced robotic focal therapy platform. Q1 was a great start, and we are confident in our ability to deliver on our 2026 priorities. Operator, please open the line for questions.

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Operator: [Operator Instructions] We’ll take our first question from Michael Sarcone with Jefferies.

Michael Sarcone: Just to start, the U.S. HIFU procedure growth, 53%, really impressive, and that’s a nice acceleration. Maybe you can just talk a little bit more about what you’re seeing in terms of utilization and what’s driving that growth? And then, I guess, secondly, how sustainable is that level of growth in your opinion?

Ryan Rhodes: Yes, Michael. So first off, yes, we had good procedure growth and again, on a quarter-over-quarter basis, double-digit growth. And so again, we’re seeing increased demand for non-radical treatments, obviously, focal therapy being the discussion point. So I see — we see a couple of things. One is our installed base customers continue to evolve with their programs. We’ve expanded training to additional doctors. So that has a direct input to increased volume of procedures. But also, we’re getting better at ramping programs. And so obviously, selling more capital creates more capacity to treat more patients. So I think it’s really a combination of a number of things. I think the patient audience, as we know, prostate cancer is a heterogeneous cancer.

So patients are now doing more research. They’re really looking at their options closely. And if they’re really not a candidate for radical treatments, then they should ideally be on active surveillance or they should be a target for focal therapy. So we see very good engagement from the centers that have our technology and certainly more centers looking to adopt it. And so again, I would — we have a dedicated sales force on the clinical side that’s doing an excellent job of advancing the programs. And again, we sell and build a program. So we feel very confident that we’ll continue to grow our procedures. It’s a very important metric for us. And of course, it’s important to driving increased margin as well as overall revenue.

Michael Sarcone: That’s helpful. And I guess just to follow up on that. When you think about your U.S. accounts, in particular, for Focal One, I mean, can you give us some sense of what’s the average number of surgeons using the system at accounts today? And maybe talk about how that’s evolved over the past few quarters.

Ryan Rhodes: Yes. So very good question. So some of our earlier programs, we had individual surgeons or urologists that drove deals. And of course, as we described it as a program, a program may involve a number of urologists. So we’ve moved from kind of that 1.5 number of trained doctors to nearly 2 per site, 2 or more. We have some sites where we have as many as 6 urologists trained to access Focal One and more in the queue to be trained in coming quarters and including weeks. So we’re a little more prescriptive now as we’ve matured in our business. We want to train more urologists. It really depends — it varies by institution, academic centers versus community hospitals. But we’re in that kind of 2 or more range is our goal. And certainly, in some instances, as I referenced, we have up to 6 or 7 urologists trained and now starting to access Focal One. So that’s really positive for us. And we’ll continue to do — continue to focus on that as we launch new programs.

Michael Sarcone: All right. And then if I could just squeeze in one more. Just on the endometriosis side, it sounds like some really solid momentum overseas. I guess just a 2-parter here. How are you thinking about financial contribution as you start to see endometriosis application grow? And then secondly here, any update on what’s going on with your U.S. efforts in endometriosis?

Ryan Rhodes: Yes. So as we talked about, we had some great wins in the quarter with gynecologists weighing in on endometriosis. So again, bringing in a second specialty, we’re not only a urology company in men’s health, but we’re also becoming a women’s health company. So I think what you’re seeing there is certainly more activity on the capital sales side. In the short term, we’ll see that. I think we’ll see more of that coming because we can do more procedures on the same platform, Focal One. So it may be too early to say in our models, we’ll have more that we can share in future updates of how that may play into the overall revenue number, including recurring revenue, right, on disposables or consumables. As far as the U.S., we — as noted, we’re still waiting for published data from the randomized controlled trial that has now follow-up out to 24 months, coming up on 24 months.

And then there was a subset of patients who are part of the sham arm who were treated and were coming up to 12 months follow-up. We’re expecting that data to be published likely sometime this year. That data will be very important for us to revisit our strategy with the FDA in the U.S. So the good news is some of this data has been recently discussed and presented at the 2 meetings I referenced in Europe. And there seems to be very good engagement from the thought leaders who specialize in endometriosis. So — but when these — when the new data is presented, I think that will be an opportunity again to take that and that will play directly back into the conversations that we’ll have with the FDA.

Operator: We’ll take our next question from Jason Bednar with Piper Sandler.

Jason Bednar: Congrats on the quarter here. I wanted to start on the HIFU business here in the U.S. Your placements are doing well globally. That’s obviously put a really good growth here in the quarter. A lot of that can be attributed to this international expansion that you’re touching on. I know we’re a few years into this more focused commercial initiative around HIFU in the U.S. as well, though. Can you take us around through how you’re thinking about the U.S. market? What does that runway look like in the U.S.? And when we think about opportunities in HIFU, are they just simply greater now outside the U.S., and that’s why we’re seeing more emphasis and growth from — again, from kind of your ex U.S. markets?

Ryan Rhodes: Yes. So what — again, we sell what we believe and clearly have demonstrated a clinically necessary strategic revenue-enhancing service line in the #1 diagnosed cancer in men. So prostate cancer, obviously, is an anchor point in men’s health. So looking at the system sales, we have a strong pipeline, and that pipeline is building. I think hospitals are also starting to recognize the need to answer to the call of offering focal therapy. Focal therapy is emerging as a treatment category, as we know, but it is a necessity to be a comprehensive offering in a hospital. And we are looking at our system sales, we’re really early in this adoption life cycle. I mean, we’re growing here, but the upside is significant for the company and looking at total numbers of potential sales for the future, and I’m talking about the U.S. So again, we continue to focus on building our active pipelines.

As you can see, we continue to sell in academic centers, but also growing more rapidly in community hospitals. And that’s important, and we’ve had some notable wins as we look across our installed base. In the outside U.S., I think the important thing to understand is our legacy history in urology as a company in extracorporeal shockwave lithotripsy, we already have an established sales channel. So now we’re fully activating on that sales channel. A number of us came from Intuitive Surgical, and we know the playbook, and we’re applying that playbook like we did back in the early days of radical prostatectomy. And so I think we’re seeing those results play out now. So the outside U.S. market continues to gain traction as we continue to move the U.S. market.

Ken Mobeck: And to add to that, as we look at our mix for the year, it will still be predominantly in the U.S. when it comes to unit sales. And as a reminder, we sell direct in the U.S. so we can demand a higher ASP, both on our systems and on our consumable products.

Jason Bednar: Okay. So just to clarify, Ken, you’re saying that embedded in the guidance for the rest of this year, what’s implied is that U.S. accounts for a disproportionate amount of the mix of system sales?

Ken Mobeck: Correct.

Jason Bednar: Okay. Perfect. Maybe next one on — obviously have the biggest conference coming up here with AUA. Is there anything quantitative you’re prepared to talk about in terms of sessions, meetings exposure? I know, Ryan, you mentioned a lot of those that are — that you have planned, but how this year’s conference compares to the last few years as you look to broaden your exposure and deepen your relationships?

Ryan Rhodes: Yes. So a couple of good things for this year. The meeting is in Washington, D.C. next week. And as communicated on the call, we have a course going on with Memorial Sloan Kettering Cancer Center. So that’s on the front end of AUA, the day before, and then we’re going to be directly in Washington, D.C. with the scientific program of AUA. So as we look at it, we will have a very strong showing at this meeting, a lot of busy activity at our booth. We have presentations where we have the ability to do case simulations, which are really important for new customers that get to get on the Focal One platform and go through an actual treatment. They see how easy it is to set up the treatment and what the robotic platform can do for them.

Beyond that, I would just say there a scattering of different scientific presentations throughout the meeting, abstracts either presented orally or in some of the poster sessions or even some discussion on the growth of focal therapy. I think the biggest thing that we see is focal therapy is becoming more of a household word in the treatment category of prostate cancer. As it continues to evolve, we’re in a new era of treatment. So we’ll see some of that going on out in the scientific sessions. We have a number of presentations from key thought leaders at our booth. We’ll have a dinner event that’s already sold out, and we’re excited about that. That will be on Saturday night. So we’ll have a lot of great activity. And of course, we have a very large booth in the main focused area of the exhibit hall.

While we’re there, we’re entertaining a number of discussions with key investors and key analysts. We believe we’re a breakout story. So we want to have those conversations and continue the momentum we’re building.

Jason Bednar: All right. Very good. Last one for me and maybe just shortly after the AUA, you’ve got your Investor Day coming up. Should we be prepared for a long-range plan at the Investor Day? Is that something you’re going to be prepared to discuss?

Ryan Rhodes: Yes. On our Investor Day, really, we’re really at an inflection point of our business. So we want to provide a number of key updates. So there will be some updates on our financial models. We’ll be talking about kind of the wrap around our commercial strategy. Of course, we’ll be talking about some of the new indications and what we’re focusing on there. And I think there’ll be a technology element, something we haven’t discussed or shown before that will be of interest to all attendees. We’re investing in some new innovations as it relates to Focal One, but even beyond Focal One. So I think there’ll be a lot there for people to learn and understand, and we look forward to sharing those updates accordingly.

Operator: At this time, there are no further questions. I will now turn the meeting back to Ryan Rhodes.

Ryan Rhodes: As discussed on this quarter’s call, Focal One Robotic HIFU continues to emerge as a market-leading focal therapy technology being adopted by more and more physicians and hospitals around the world. Focal One requires no surgery cutting or use of radiation, thus allowing physicians to perform a noninvasive precise robotic targeted ablation that treats only the intended disease areas while preserving the patient’s healthy tissue. Its focus as an organ-sparing and function-preserving treatment aligns with the direction of modern medicine. Importantly, Focal One is not just a device. It’s a foundation of program building within health care institutions. We believe this multi-specialty multi-indication strategy positions us well for sustained growth and long-term value creation.

I want to thank everyone for joining us on today’s call. We look forward to seeing you at the upcoming Annual Meeting of the American Urological Association next week and at our Investor Day and the Jefferies Healthcare Conference, both taking place in New York City in early June. Thank you.

Operator: Thank you. This brings us to the end of today’s meeting. We appreciate your time and participation. You may now disconnect.

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