IRADIMED CORP

Previous wording

The following discussion and analysis should be read in conjunction with our unaudited condensed financial statements and the related notes to those statements included in this Quarterly Report, the discussion of certain risks and uncertainties contained in “Part I, Item 1A, Risk Factors” of this Quarterly Report, the discussion under “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Part I, Item 1. Business” included in the 2023 Annual Report and the “Cautionary Statements Regarding Forward-Looking Statements” section at the beginning of this Quarterly Report.

Current wording

The following discussion and analysis should be read in conjunction with our unaudited condensed financial statements and the related notes to those statements included in this Quarterly Report, the discussion of certain risks and uncertainties contained in “Part I. Item 1A. Risk Factors,” the discussion under “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Part I, Item 1. Business” included in the 2024 Annual Report and “Part II. Item 1A. Risk Factors” of this Quarterly Report and the “Cautionary Statements Regarding Forward-Looking Statements” section at the beginning of this Quarterly Report.

Previous wording

We develop, manufacture, market and distribute MRI compatible medical devices and accessories, disposables and services relating to them.

Current wording

We develop, manufacture, market, sell, and distribute MRI compatible medical devices and product related accessories, disposables, and services.

Previous wording

We are a leader in the development of innovative MRI compatible medical devices. We are the only known provider of a non-magnetic IV infusion pump system that is specifically designed to be safe for use during MRI procedures. We were the first to develop an infusion delivery system that largely eliminates many of the dangers and problems present during MRI procedures. Standard infusion pumps contain magnetic and electronic components, which can create radio frequency interference and are dangerous to operate in the presence of the powerful magnet that drives an MRI system. Our patented MRidium® MRI compatible IV infusion pump system has been designed with a non-magnetic ultrasonic motor, uniquely designed non-ferrous parts and other special features to safely and predictably deliver anesthesia and other IV fluids during various MRI procedures. Our pump solution provides a seamless approach that enables accurate, safe and dependable fluid delivery before, during and after an MRI scan, which is important to critically ill patients who cannot be removed from their vital medications, and children and infants who must generally be sedated to remain immobile during an MRI scan.

Current wording

We are a leader in the development of innovative MRI compatible medical devices and products. We are the only known provider of a non-magnetic IV infusion pump system that is specifically designed to be safe for use during MRI procedures. We were the first to develop an infusion delivery system that largely eliminates many of the dangers and problems present during MRI procedures. Standard infusion pumps contain magnetic and electronic components, which can create radio frequency interference and are dangerous to operate in the presence of the powerful magnet that drives an MRI system. Our patented MRidium® MRI compatible IV infusion pump system has been designed with a non-magnetic ultrasonic motor, uniquely designed non-ferrous parts and other special features to safely and predictably deliver anesthesia and other IV fluids during various MRI procedures. Our pump solution provides a seamless approach that enables accurate, safe and dependable fluid delivery before, during and after an MRI scan, which is important to critically ill patients who cannot be removed from their vital medications, and children and infants who must generally be sedated to remain immobile during an MRI scan.

Previous wording

We generate revenue from the sale of MRI compatible medical devices and accessories, extended warranty agreements, services related to maintaining our products and the sale of disposable products used with our devices. The principal customers for our MRI compatible products include hospitals and acute care facilities, both in the United States and internationally. As of September 30, 2024, our direct U.S. sales force consisted of 27 field sales representatives, 4 regional sales directors and supplemented by 8 clinical application specialists. Internationally, we have distribution agreements with independent distributors selling our products.

Current wording

We generate revenue from the sale of MRI compatible medical devices and related products, accessories, extended warranty agreements, services related to maintaining our products and the sale of disposable products used with our devices. The principal customers for our MRI compatible products include hospitals and acute care facilities, both in the United States and internationally. As of March 31, 2025, our direct U.S. sales force consisted of 27 field sales representatives, 4 regional sales directors and supplemented by 9 clinical application specialists. Internationally, we have distribution agreements with independent distributors selling our products.

Previous wording

For the quarter ended September 30, 2024, our revenue increased by $1.8 million, or 11.0% to $18.3 million, compared to $16.5 million for the quarter ended September 30, 2023. Income before the provision for income taxes was $6.4 million for the quarter ended September 30, 2024, compared to $6.4 million for the quarter ended

Current wording

For the quarter ended March 31, 2025, our revenue increased by $1.9 million, or 11% to $19.5 million, compared to $17.6 million for the quarter ended March 31, 2024. Income before the provision for income taxes was $5.9 million for the quarter ended March 31, 2025, compared to $5.2 million for the quarter ended March 31, 2024. Net income was $4.7 million, or $0.37 per diluted share, in the quarter ended March 31, 2025, compared to $4.1 million, or $0.32 per diluted share in the quarter ended March 31, 2024.

Previous wording

For the remainder of 2024, we expect higher revenue when compared to the same period in 2023 primarily due to higher sales of our medical devices, related accessories, disposables, and services. We also expect higher operating expenses compared to the same period in 2023 primarily due to higher sales and marketing, regulatory, and general and administrative expenses.

Current wording

For the remainder of fiscal year 2025, we expect higher revenue when compared to the same period in 2024 primarily due to higher sales of our medical devices and products, related accessories, disposables, and services. We also expect higher operating expenses compared to the same period in 2024 primarily due to higher sales and marketing, regulatory, and general and administrative expenses.

Previous wording

The discussion and analysis of our financial condition and results of operations are based on our unaudited condensed financial statements, which we have prepared in accordance with GAAP. The preparation of these unaudited condensed financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the unaudited condensed financial statements as well as the reported revenue and expenses during the reporting periods. On an ongoing basis, we evaluate our estimates and judgments. We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

Current wording

statements as well as the reported revenue and expenses during the reporting periods. On an ongoing basis, we evaluate our estimates and judgments. We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

Previous wording

We believe that the estimates, assumptions and judgments involved in the accounting policies described in “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations*”* of our 2023 Annual Report have the greatest potential impact on our financial statements, so we consider them to

Current wording

We believe that the estimates, assumptions and judgments involved in the accounting policies described in “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations*”* of our 2024 Annual Report have the greatest potential impact on our financial statements, so we consider them to be our critical accounting policies and estimates. As of March 31, 2025, there were no material changes to the information provided regarding recent accounting pronouncements in Note 1 to the Financial Statements in the 2024 Annual Report.

Previous wording

Comparison of the Three Months Ended and Nine Months Ended September 30, 2024 and 2023

Current wording

Comparison of the Three Months Ended March 31, 2025 and 2024

Previous wording

For the three months ended September 30,2024, revenue increased by $1.8 million, or 11.0%, to $18.3 million from $16.5 million for the same period in 2023. This is attributed to continued demand for our IV Infusion Pump System, Disposables and extended warranty revenue.

Current wording

For the three months ended March 31,2025, revenue increased by $1.9 million, or 11%, to $19.5 million from $17.6 million for the same period in 2024. This is attributed to continued demand for our IV Infusion Pump System, disposables and amortization of extended warranty revenue.

Previous wording

Revenue from sales in the U.S. increased by $1.3 million, or 9.4%, to $15.2 million for the three months ended September 30, 2024, from $13.9 million for the same period in 2023. Revenue from sales internationally increased by $0.5 million, or 19.2%, for the three months ended September 30, 2024 to $3.1 million, from $2.6 million for the same period in 2023. Domestic sales accounted for 82.9% of revenue for the three months ended September 30, 2024, compared to 84.2% for the same period in 2023.

Current wording

Revenue from sales in the U.S. increased by $2.5 million, or 19%, to $16.0 million for the three months ended March 31, 2025, from $13.4 million for the same period in 2024. Revenue from sales internationally decreased by $0.6 million, or 15%, for the three months ended March 31, 2025 to $3.6 million, from $4.2 million for the same period in 2024. Domestic sales accounted for 82% of revenue for the three months ended March 31, 2025, compared to 76% for the same period in 2024.

Previous wording

Revenue from sales of our disposables, service and other increased by $0.5 million, or 11.9%, to $4.7 million for the three months ended September 30, 2024, from $4.2 million for the same period in 2023. Revenue from the amortization of extended warranty agreements increased by $0.1 million, or 15.0%, to $0.6 million for the three months ended September 30, 2024, from $0.5 million for the three months ended September 30, 2023.

Current wording

For the three months ended March 31, 2025 our cost of revenue increased by $0.5 million, or 12%, to $4.7 million from $4.2 million for the same period in 2024. For the three months ended March 31, 2025, our gross profit increased by $1.4 million, or 10%, to $14.8 million from $13.4 million for the same period in 2024. Gross profit margin remained at 76.1% for both the three months ended March 31, 2025 and 2024.

Previous wording

For the three months ended September 30, 2024, general and administrative expense increased by $0.4 million, or 11.1%, to $4.0 million from $3.6 million for the same period in 2023. This increase is primarily due to higher legal and professional expenses, software maintenance, and increased payroll and benefit expenses.

Current wording

For the three months ended March 31, 2025, general and administrative expense increased by $0.6 million, or 15%, to $4.6 million from $4.0 million for the same period in 2024. This increase is primarily due to higher legal and professional expenses, software maintenance, and increased payroll and benefit expenses.

Previous wording

For the three months ended September 30, 2024, sales and marketing expense increased by $0.9 million, or 31.0%, to $3.8 million from $2.9 million for the same period in 2023. This increase is primarily due to higher sales commissions, sales activities expenses, and payroll and benefits expenses.

Current wording

For the three months ended March 31, 2025, sales and marketing expense increased by $0.4 million, or 11%, to $4.2 million from $3.8 million for the same period in 2024. This increase is primarily due to higher sales commissions, sales activities expenses, and payroll and benefits expenses.

Previous wording

For the three months ended September 30,2024, research and development expense increased by $0.1 million, or 20.0%, to $0.6 million from $0.5 million for the same period in 2023. This is primarily due to us no longer allocating recently approved product parts related to the next generation pump to research and development, offset by increased payroll and benefit expenses. These approved parts are now included in raw material inventory.

Current wording

For the three months ended March 31,2025, research and development expense decreased by $0.2 million, or 25.0%, to $0.6 million from $0.8 million for the same period in 2024. This is primarily due to a reduction in the purchase of protype materials, offset by increased payroll and benefit expenses. These approved parts are now included in raw material inventory.

Previous wording

Other income, net consists of interest income, foreign currency gains and losses, and other miscellaneous income. For the three months ended September 30, 2024, other income, net increased by $0.1 million, to $0.6 million from $0.5 million for the same period in 2023. This increase is due to higher interest rates earned by money market fund investments that comprise a significant portion of our cash balances.

Current wording

Other income, net consists of interest income, (the largest component), foreign currency gains and losses, and other miscellaneous income. For the three months ended March 31, 2025, other income, net remained consistent at $0.5 million compared with the same period in 2024.

Previous wording

For the three and nine months ended September 30, 2024, we recorded a provision for income tax expense of $1,368,830 and $3,843,834, respectively. Our effective tax rate was 21.3% and 21.4% for the three and nine months ended September 30, 2024, respectively, and differed from the U.S. Federal statutory rate primarily due to U.S. state income tax expense, partially offset by research and development tax credits.

Current wording

For the three months ended March 31, 2025, we recorded a provision for income tax expense of $1,258,000. Our effective tax rate was 21.2% for the three months ended March 31, 2025 and differed from the U.S. Federal statutory rate primarily due to U.S. state income tax expense, partially offset by research and development tax credits.

Previous wording

For the three and nine months ended September 30,2023, we recorded a provision for income tax expense of $1,341,352 and $3,403,523, respectively. Our effective tax rate was 20.9% and 21.2%, respectively, and differed from the U.S. Federal statutory rate primarily due to U.S. Federal income tax expense partially offset by research and development tax credits.

Current wording

For the three months ended March 31,2024, we recorded a provision for income tax expense of $1,106,968. Our effective tax rate was 21.1% and differed from the U.S. Federal statutory rate primarily due to U.S. state income tax expense partially offset by research and development tax credits.

Previous wording

On July 31, 2024, the Company received notice of examination from the U.S. Internal Revenue Service for the tax year ended December 31, 2021. We are currently complying with the taxing authority and believe our tax position for the year under review was appropriate and have not accounted for any proposed adjustments at this time. The Company remains subject to income tax examinations for our United States Federal and certain U.S. state income taxes for 2019 and subsequent years.

Current wording

On July 31, 2024, the Company received a notice of examination from the U.S. Internal Revenue Service for the tax year ended December 31, 2021. We are currently complying with the taxing authority and believe our tax position for the year under review was appropriate and have not accounted for any proposed adjustments at this time. The Company remains subject to income tax examinations for our United States Federal and certain U.S. state income taxes for 2020 and subsequent years.

Previous wording

As of September 30, 2024, we had cash and cash equivalents of $51.7 million, stockholders’ equity of $83.4 million, and working capital of $66.2 million. As of December 31, 2023, we had cash and cash equivalents of $49.8 million, stockholders’ equity of $71.4 million, and working capital of $59.7 million.

Current wording

As of March 31, 2025, we had cash and cash equivalents of $50.3 million, stockholders’ equity of $90.1 million, and working capital of $66.7 million. As of December 31, 2024, we had cash and cash equivalents of $52.2 million, stockholders’ equity of $86.8 million, and working capital of $66.7 million.

Previous wording

We believe that our current cash, and any cash generated from operations will be sufficient to meet our ongoing operating requirements for at least the next 12 months and into the foreseeable future. We do not anticipate requiring additional capital; however, if required or desirable, we may seek to obtain a credit facility, raise debt, or issue additional equity in private or public markets.

Current wording

We believe that our current cash, and any cash generated from operations will be sufficient to meet our ongoing operating requirements for at least the next 12 months and into the foreseeable future. We do not anticipate requiring additional capital; however, if required or desirable, we may seek to obtain a credit facility, raise debt, or issue additional equity in private or public markets. However, ongoing negative economic conditions (including in relation to inflationary pressures, elevated interest rate levels and impacts from the imposition of, or changes in, tariffs) have resulted in, and may continue to result in, significant disruptions of financial and capital markets, which could reduce our ability to access capital and negatively affect our liquidity in the future.

Previous wording

Cash provided by operating activities increased by $10.0 million, to $19.6 million for the nine months ended September 30, 2024, compared to $9.6 million for the same period in 2023. During the nine months ended September 30, 2024, cash provided by operations was positively impacted by net income, lower inventory purchases, and reduced accounts receivable and negatively impacted by higher cash outflows related to accounts payable.

Current wording

Cash provided by operating activities increased by $0.4 million, to $4.3 million for the three months ended March 31, 2025, compared to $3.9 million for the same period in 2024. During the three months ended March 31, 2025, cash provided by operations was positively impacted by higher net income, lower cash outflows related to accounts payable, and negatively impacted by increased inventory purchases and accounts receivable.

Previous wording

Cash used in investing activities decreased by $1.6 million, to $5.8 million for the nine months ended September 30, 2024, compared to $7.4 million for the same period in 2023. For the nine months ended September 30, 2023, we acquired land for $6.2 million in cash to be used for future office, assembly, warehouse, and shipping space to accommodate our increased operations and anticipated growth. The majority of our 2024 spend in investing activities is attributed to construction costs of our new facility on the aforementioned land.

Current wording

Cash used in investing activities decreased by $3.4 million, to $3.9 million for the three months ended March 31, 2025, compared to $0.5 million for the same period in 2024. The majority of our 2025 spend in investing activities is attributed to construction costs of the New Facility to accommodate our increased and anticipated growth.

Previous wording

Cash used in financing activities decreased by $1.5 million, to $11.9 million for the nine months ended September 30, 2024, compared to approximately $13.4 million for the same period in 2023. In both periods, the Company paid special dividends to our stockholders; and in the 2024 period, we commenced a regular quarterly dividend policy, subject to the sole discretion of the Company’s Board of Directors and applicable law.

Current wording

Cash used in financing activities decreased by $5.7 million, to $2.3 million for the three months ended March 31, 2025, compared to approximately $8.0 million for the same period in 2024. In March 2024, the Company paid a special dividend to our stockholders; and commenced a regular quarterly dividend payment, subject to the sole discretion of the Company’s Board of Directors and applicable law.