Spectral AI, Inc.
For the period ended Sep 30, 2025. Filed Nov 13, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Nov 13, 2025
MDAI$1.49+8.0%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-08-13.
0001213900-25-075125
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-11-13.
0001213900-25-109409
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 101 previous paragraphs and 103 current paragraphs.
82 unchanged; 19 reworded; 2 added; 0 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 13 previous and 13 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (2)
Current report
General and administrative expense was $13.4 million, for the nine months ended September 30, 2025, respectively, a decrease of 12.7% as compared to the same period in 2024, from the reduction in research and development as the Company completed its FDA DeNovo submission in the end of the second quarter of 2025. Non-revenue generating research and development activities, primarily related to salaries and related costs and consulting fees, have decreased by approximately $2.5 million for the nine months ended September 30, 2025 compared to the same period in 2024.
Current report
In October 2025, the Company entered into a securities purchase agreement which provided for the issuance and sale of 3.1 million shares of common stock, at an offering price of $1.90 per share. In addition, in a concurrent private placement the Company issued and sold warrants for the purchase of up to 4.0 million shares of common stock and pre-funded warrants to purchase up to 0.9 million shares of common stock, for aggregate gross proceeds of $7.6 million.
Reworded paragraphs (19)
Previous wording
In addition to our BARDA contract, we received a $4.0 million grant award from MTEC in April 2023, which, building on prior awards from DHA, is to be used to support military battlefield burn evaluation via a handheld DeepView System device. In August 2024, the MTEC award was increased to $4.9 million and is currently intended to run through December 2025 with funding dependent on various milestones. In March 2024, we received an additional $0.5 million award from the DHA to further this development, for a total contract value of approximately $2.8 million.
Current wording
In addition to our BARDA contract, we received a $4.0 million grant award from MTEC in April 2023, is to be used to support military battlefield burn evaluation via a handheld DeepView System device. In August 2024, the MTEC award was increased to $4.9 million and is currently intended to run through December 2025 with funding dependent on various milestones. In March 2024, we received an additional $0.5 million award from the DHA.
Previous wording
Comparison of Three and Six Months Ended June 30, 2025 and 2024
Current wording
Comparison of Three and Nine Months Ended September 30, 2025 and 2024
Previous wording
The following table summarizes these metrics for the three and six months ended June 30, 2025 and 2024 (in thousands):
Current wording
The following table summarizes these metrics for the three and nine months ended September 30, 2025 and 2024 (in thousands):
Previous wording
The following table summarizes our results of operations for the three and six months ended June 30, 2025 and 2024 (in thousands):
Current wording
The following table summarizes our results of operations for the three and nine months ended September 30, 2025 and 2024 (in thousands):
Previous wording
Research and development revenue was $5.1 million and $11.8 million for the three and six months ended June 30, 2025, respectively, a decrease of 32.3% and 14.7%, respectively, compared to the comparable periods in 2024, reflecting less activity as we completed work under the PBS BARDA Contract.
Current wording
Research and development revenue was $3.8 million and $15.6 million for the three and nine months ended September 30, 2025, respectively, a decrease of 53.6% and 29.2%, respectively, compared to the same periods in 2024, reflecting reduced research and development as we approached DeNovo submission under the PBS BARDA Contract.
Previous wording
For the three and six months ended June 30, 2025 and 2024, the Company’s revenues disaggregated by the major sources was as follows (in thousands):
Current wording
For the three and nine months ended September 30, 2025 and 2024, the Company’s revenues disaggregated by the major sources were as follows (in thousands):
Previous wording
Cost of revenue for the three and six months ended June 30, 2025 was $2.8 million and $6.3 million, respectively, an decrease of 33.4% and 16.3%, respectively, compared to the comparable periods in 2024, due to decreased activity to fulfill our U.S. governmental contracts, consistent with decreased research and development revenue.
Current wording
Cost of revenue for the three and nine months ended September 30, 2025 was $2.1 million and $8.5 million, respectively, a decrease of 51.8% and 29.6%, respectively, compared to the same periods in 2024, due to reduced research and development as we approached DeNovo submission to fulfill our U.S. governmental contracts, in conjunction with decreased research and development revenue.
Previous wording
Gross margin for the three and six months ended June 30, 2025 was 45.2% and 46.4%, respectively, an increase of 0.9% and 1.1%, respectively, as compared to the comparable periods in 2024, due to a higher concentration of direct labor as a component of our overall revenue.
Current wording
Gross margin for the three and nine months ended September 30, 2025 was 42.7% and 45.5%, respectively, a decrease of 2.1% and increase of 0.3%, respectively, as compared to the same periods in 2024, due to a higher concentration of direct labor as a component of our overall revenue.
Previous wording
General and administrative expense was $4.4 million and $8.5 million, for the three and six months ended June 30, 2025, respectively, a decrease of 23.3% and 21.8% respectively, as compared to the comparable period in 2024. Non-revenue generating research and development activities, primarily related to salaries and related costs and consulting fees, have decreased by approximately $3.9 million and $5.0 million for the three and six months ended June 30, 2025 compared to the comparable period in 2024 offset by an increase of approximately $1.5 million and $2.7 million, related to other administrative expenses for the three and six months ended June 30, 2025, respectively, compared to the comparable period in 2024. Additionally, the Company incurred less put option and premium expense for financing transactions in the current year.
Current wording
General and administrative expense was $5.0 million for the three months ended September 30, 2025, an increase of 9.0%, as compared to the same period in 2024 due to the shift from BARDA research and development to administrative work for FDA submission. Non-revenue generating research and development activities, primarily related to salaries and related costs and consulting fees. Additionally, the Company incurred less put option and premium expense for financing transactions in the current year.
Previous wording
Net interest (expense) income for the three and six months ended June 30, 2025 primarily relates to costs related to the financing relating to the Company’s insurance policies.
Current wording
Net interest expense for the three and nine months ended September 30, 2025 primarily relate to interest expense associated with the Avenue Financing as well as costs related to the Company’s insurance policy financing.
Previous wording
Change in fair value of warrant liability decreased by approximately $5.8 million and $1.6 million for the three and six months ended June 30, 2025 as compared to the comparable period in 2024. The increase reflects changes in the fair value of the Company’s Public Warrants for the three-month and six-month period ended June 30, 2025. The Company repriced the Public Warrants in November 2024 to an exercise price of $2.75 from $11.50 per share. The Company’s Public Warrants are classified as liabilities and remeasured to fair value at each reporting period, with changes recognized in net loss. As a result, fluctuations in the warrant price may cause significant non-cash gains or losses, leading to volatility in reported net loss.
Current wording
Change in fair value of warrant liability decreased by approximately $86 thousand for the three months ended September 30, 2025 as compared to the same period in 2024. Change in fair value of warrant liability was an expense of $0.9 million for the nine months ended September 30, 2025, as compared to a benefit of $0.7 million for same period in 2024. The changes reflect fluctuations in the fair value of the Company’s warrants during the three-month and nine-month period ended September 30, 2025. The Company’s warrants are classified as liabilities and remeasured to fair value at each reporting period, with changes recognized in net loss. As a result, fluctuations in the warrant price of Public Warrants and fluctuations in the fair value of other outstanding warrants may cause significant non-cash gains or losses, leading to volatility in reported net loss.
Previous wording
Foreign exchange transaction loss for three and six months ended June 30, 2025 are immaterial due to lower balances in our deposit accounts and accounts payable denominated in British pound sterling and less fluctuation in the exchange rate between the U.S. dollar and the British pound sterling. Foreign exchange transaction loss for the three and six months ended June 30, 2024 relates to the increased exchange rate between the U.S. dollar and the British pound sterling for our deposit accounts that are denominated in British pound sterling. In addition, this amount includes costs associated with buying British pound sterling for payment of our employees and vendors in the UK.
Current wording
Foreign exchange transaction loss for three and nine months ended September 30, 2025 are due to lower balances in our deposit accounts and accounts payable denominated in British pound sterling and less fluctuation in the exchange rate between the U.S. dollar and the British pound sterling. Foreign exchange transaction loss for the three and nine months ended September 30, 2024 relates to the increased exchange rate between the U.S. dollar and the British pound sterling for our deposit accounts that are denominated in British pound sterling. In addition, this amount includes costs associated with buying British pound sterling for payment of our employees and vendors in the UK.
Previous wording
The following table presents our Adjusted EBITDA for the three months ended March 31, 2025 and 2024 (in thousands):
Current wording
The following table presents our Adjusted EBITDA for the three and nine months ended September 30, 2025 and 2024 (in thousands):
Previous wording
As of June 30, 2025 we had approximately $10.5 million in cash, notes payable of $7.7 million, and no other long-term debt. We had an accumulated deficit of approximately $53.3 million.
Current wording
As of September 30, 2025 we had approximately $10.5 million in cash, which is flat when compared to the second quarter of 2025. We had notes payable of $7.8 million, and no other long-term debt. We had an accumulated deficit of approximately $56.9 million.
Previous wording
The new PBS BARDA Contract, executed in September 2023, has a total value of up to approximately $150.0 million if all future options are executed. The base phase of the PBS BARDA Contract, valued at $54.9 million, was exercised concurrently with the contract award in September 2023. To date, our total potential support from BARDA is nearly $272.9 million for our 2013, 2019, and 2023 awards. In April 2023, we received a $4.0 million grant under the MTEC Agreement. In August 2024, the MTEC award was increased to $4.9 million and is currently intended to run through December 2025 with funding dependent on various milestones. See “Research and Development Revenue” above. With the PBS BARDA Contract and funding available through the Avenue Financing (as described below), the Company believes it will have sufficient working capital to fund operations for at least one year beyond the release date of the condensed consolidated financial statements.
Current wording
The new PBS BARDA Contract, executed in September 2023, has a total value of up to approximately $150.0 million if all future options are executed. The base phase of the PBS BARDA Contract, valued at $54.9 million, was exercised concurrently with the contract award in September 2023. To date, our total potential support from BARDA is nearly $272.9 million for our 2013, 2019, and 2023 awards. In April 2023, we received a $4.0 million grant under the MTEC Agreement. In August 2024, the MTEC award was increased to $4.9 million and is currently intended to run through December 2025 with funding dependent on various milestones. See “Research and Development Revenue” above. With the PBS BARDA Contract, the recent $7.6 million common stock offering and funding available through the Avenue Financing (as described below), the Company believes it will have sufficient working capital to fund operations for at least one year beyond the release date of the condensed consolidated financial statements.
Previous wording
The following table summarizes our cash flows for the six months ended June 30, 2025 and 2024 (in thousands):
Current wording
The following table summarizes our cash flows for the nine months ended September 30, 2025 and 2024 (in thousands):
Previous wording
Net cash used in operating activities increased by approximately $3.2 million for the six months ended June 30, 2025, as compared to the six months ended June 30, 2024, primarily driven by decreased staffing levels and consulting costs and expenses resulting from the change in focus to DeepView Burn.
Current wording
Net cash used in operating activities decreased by approximately $2.3 million for the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024, primarily driven by decreased staffing levels and consulting costs and expenses resulting from the change in focus to DeepView Burn.
Previous wording
Net cash provided by financing activities increased to approximately $10.2 million for the six months ended June 30, 2025 as compared to $10.1 million for the six months ended June 30, 2024. This was primarily attributable to proceeds from the Avenue Financing of $8.5 million and the attendant equity raise of $2.7 million partially offset by the loan repayments on the Yorkville debt facility.
Current wording
Net cash provided by financing activities increased to approximately $12.7 million for the nine months ended September 30, 2025 as compared to $8.6 million for the nine months ended September 30, 2024. This was primarily attributable to proceeds from the Avenue Financing of $8.3 million, proceeds from the exercise of common stock warrants of $2.0 million and the attendant equity raise of $3.1 million partially, offset by the loan repayments on the Yorkville debt facility.
Previous wording
Our critical accounting policies are described under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Critical Accounting Policies” in our Annual Report on Form 10-K for the year ended December 31, 2024, which was filed with the SEC on March 31, 2025. During the six months ended June 30, 2025, there were no material changes to our critical accounting policies from those previously disclosed.
Current wording
Our critical accounting policies are described under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Critical Accounting Policies” in our Annual Report on Form 10-K for the year ended December 31, 2024, which was filed with the SEC on March 31, 2025. During the nine months ended September 30, 2025, there were no material changes to our critical accounting policies from those previously disclosed.