Neuronetics, Inc.

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Geopolitical instability and related disruptions to global markets could adversely affect global economic conditions and our business.

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Ongoing geopolitical tensions in the Middle East, including the conflict involving Iran, have contributed to volatility in global markets, which may increase the overall costs. Inflationary pressures may also contribute to broader macroeconomic volatility, which, in turn, could adversely affect our business. Further, supply chain disruptions, transaction restrictions and increased costs for raw materials could adversely affect our business, which could have a material impact on our business and financial results.

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Our financial condition raises substantial doubt as to our ability to continue as a going concern.

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There is substantial doubt regarding our ability to continue as a going concern. This conclusion was based on the Company’s current projections for trailing twelve-month revenue for the period ended March 31, 2027, which are currently expected to be below the minimum required revenue for that period as stated in the Perceptive Facility.

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Although we cannot predict with certainty all of our particular short-term cash uses or the timing or amount of cash requirements or the trailing twelve-month revenue for the period ended March 31, 2027, there is substantial doubt about our ability to continue as a going concern. Our recurring losses, negative cash flow and the uncertainties surrounding our ability to execute and to realize our planned revenue growth and expected benefits from our operational improvement initiatives, could impact our future profitability and liquidity, which could in the future raise substantial doubt about our ability to continue to execute our operating plan as currently intended and require us to seek additional financing. If adequate funds or additional financings are not available, if and when needed, or if the terms of potential funding sources are unfavorable, our business, financial condition, and results of operations could be materially and adversely affected. Additionally, our financial statements have been prepared assuming that we will continue to operate as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. Thus, our financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern.

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We are subject to certain federal, state and foreign fraud and abuse laws, health information privacy and security laws and transparency laws, which, if violated, could subject us to substantial penalties. Additionally, any challenge to or investigation into our practices under these laws could cause adverse publicity and be costly to respond to, and thus could harm our business.

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There are numerous U.S. federal and state, as well as foreign, laws pertaining to healthcare fraud and abuse, including anti-kickback, self-referral, false claims and physician transparency laws. Our business practices and relationships with providers, patients, vendors and third-party payors are subject to scrutiny under these laws. We may also be subject to patient information privacy and security regulation by both the federal government in addition to the states and foreign jurisdictions in which we conduct our business.

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These laws and regulations, among other impacts, constrain our business, marketing and other promotional activities by limiting the kinds of financial arrangements, including sales programs and provider directory services, we may have with providers or other potential purchasers of our products and services. We have also entered into consulting agreements with physicians, which are subject to these laws. Further, while we do not submit claims to any payor and our customers make the ultimate decision on how to submit claims, we may provide reimbursement guidance and support regarding our products and services. Due to the breadth of these laws, the narrowness of statutory exceptions and regulatory safe harbors available, and the range of interpretations to which they are subject, it is possible that some of our current or future practices might be challenged under one or more of these laws.

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To enforce compliance with healthcare regulatory laws, certain enforcement bodies have recently increased their scrutiny of interactions between healthcare companies and healthcare providers, which has led to a number of investigations, prosecutions, convictions and settlements in the healthcare industry. Responding to investigations can be time-and resource-consuming and can divert management’s attention from the business. Any such investigation or settlement could increase our costs or otherwise have an adverse effect on our business. Even an unsuccessful challenge or investigation into our practices could cause adverse publicity and be costly to respond to.

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On October 8, 2025, a subsidiary of the Company received a Civil Investigative Demand (the “Demand”) under the FCA dated August 28, 2025, from the U.S. Attorney’s Office for the Middle District of Florida. The Demand seeks information from certain subsidiaries related to federal healthcare program billing practices. The Company is cooperating with the Assistant United States Attorney who issued the Demand and is engaged in ongoing constructive dialogue in order to satisfy the Demand. The United States Attorney for the Middle District of Florida is working jointly with the Florida, Nevada and New Jersey Attorneys General offices. The Demand is focused on periods in time prior to the Company’s acquisition of Greenbrook TMS Inc. Additionally, in October 2025, the Michigan Attorney General’s office opened a similar investigation. Similar to the Demand, the Company is cooperating with the Michigan investigation. The Company has received, and may continue to receive, similar inquiries from other districts of the U.S. attorney’s office and states’ attorney general offices.

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If our operations are found to be in violation of any of the healthcare laws or regulations described above or any other healthcare regulations that apply to us, we may be subject to penalties, including administrative, civil and criminal penalties, damages, fines, disgorgement, exclusion from participation in government healthcare programs, such as Medicare and Medicaid, imprisonment, additional reporting obligations and oversight if we becomes subject to a corporate integrity agreement or other agreement to resolve allegations of non-compliance with these laws, reputational harm, diminished profits and future earnings, and the curtailment or restructuring of our operations, any of which could adversely affect our ability to operate our business and pursue our strategy.