Beta Bionics, Inc.

Comparison of the three and nine months ended September 30, 2026 and 2025

The following table summarizes our results of operations for the periods indicated:

* Not meaningful

(1)

Includes stock-based compensation expense. See Note 11, Stock-Based Compensation, for stock-based compensation expense by financial statement line item.

Net Sales

Net sales for the three months ended September 30, 2026 were $35.5 million, compared to $27.3 million for the three months ended September 30, 2025. The increase in net sales of $8.2 million was primarily driven by an increase in the number of single-use products sold, correlated to the growth in our installed base, and growth in new patient starts. For the three months ended September 30, 2026, single-use products accounted for 68% of net sales, up from 47% for the three months ended September 30, 2025.

For the three months ended September 30, 2026, 62% of net sales were generated through the DME channel and 38% through the PBP channel, compared to 77% and 23%, respectively, for the three months ended September 30, 2025. The shift toward the PBP channel was driven by expanded pharmacy benefit coverage enabled through contracts with PBMs and their affiliated health plans, resulting in a higher proportion of new patient starts being reimbursed through this channel.

Net sales for the nine months ended September 30, 2026 were $95.1 million, compared to $68.1 million for thenine months ended September 30, 2025. This increase in net sales of $27.0 million was primarily driven by an increase in the number of single-use products sold, correlated to the growth in our installed base, and growth in new patient starts. For thenine months ended September 30, 2026, single-use products accounted for 63% of net sales, up from 44% for thenine months ended September 30, 2025.

For thenine months ended September 30, 2026, 62% of net sales were generated through the DME channel and 38% through the PBP channel, compared to 79% and 21%, respectively, for thenine months ended September 30, 2025. The shift toward the PBP channel was driven by expanded pharmacy benefit coverage, resulting in a larger percentage of new patient starts reimbursed through this channel.

Cost of Sales

Cost of sales for the three months ended September 30, 2026 was $15.2 million, compared to $12.1 million for the three months ended September 30, 2025. This increase of $3.1 million was primarily attributable to increased volumes of single-use products and iLets sold through the PBM channel.

Cost of sales for thenine months ended September 30, 2026 was $39.5 million, compared to $31.5 million for thenine months ended September 30, 2025. This increase of $8.0 million was primarily attributable to increased volumes of single-use products and iLets sold through the PBM channel.

Gross Profit and Gross Margin

Gross profit for the three months ended September 30, 2026 was $20.3 million, compared to $15.1 million for the three months ended September 30, 2025. Gross margin was 57% for the three months ended September 30, 2026, compared to 55% in the three months ended September 30, 2025. Gross profit increased by $5.2 million, primarily driven by higher sales volume. Gross margin improved year over year due to increased production scale, lower warranty expense and improved cost absorption.

Gross profit for the nine months ended September 30, 2026 was $55.7 million, compared to $36.6 million for the nine months ended September 30, 2025. Gross margin was 59% for the nine months ended September 30, 2026, compared to 54% in the nine months ended September 30, 2025. Gross profit increased by $19.1 million, primarily driven by higher sales volume. Gross margin improved year over year due to increased production scale, lower warranty expense and improved cost absorption.

Research and Development Expenses

Research and development expenses for the three months ended September 30, 2026 were $12.0 million, compared to $8.2 million for the three months ended September 30, 2025. The increase of $3.8 million was primarily attributable to a net increase of $3.1 million in materials, engineering and clinical trial-related expenses incurred in the development of Mint, our patch pump, the bihormonal system of the iLet and incremental software and product updates. The remaining increase is attributable to payroll-related expenses, including stock-based compensation, driven by an increase in headcount focused on supporting our innovation activities.

Research and development expenses for thenine months ended September 30, 2026 were$32.6 million, compared to $24.7 million for thenine months ended September 30, 2025. The increase of $7.9 million was primarily attributable to a net increase of $4.2 million in materials, engineering and clinical trial-related expenses incurred in the development of Mint, our patch pump, the bihormonal system of the iLet and incremental software and product updates. The remaining increase is attributable to payroll-related expenses, including stock-based compensation, driven by an increase in headcount focused on supporting our innovation activities.

The table below summarizes the nature of research and development expense by major expense category:

(1)

External research and development costs primarily include expenses incurred with third parties such as clinical research organizations conducting the clinical trials and engineering and product development consulting services associated with our development of the iLet and Mint, our patch pump.

(2)

Internal research and development costs primarily include personnel-related expenses for research and development functions, excluding stock-based compensation and internal costs to manufacture product candidates before FDA marketing authorization, such as raw materials and internal facilities-related expenses.

Sales and Marketing Expenses

Sales and marketing expenses for the three months ended September 30, 2026 were $25.1 million, compared to $16.0 million for the three months ended September 30, 2025. The increase of $9.1 million was primarily attributable to an increase of $6.2 million in payroll-related costs, including salaries and wages, sales incentive bonuses, and stock-based compensation due to an increase in headcount of our sales force and customer care team in connection with the expansion of our sales territories within the United States. The remaining increase includes healthcare provider (HCP)-related marketing and travel-related costs to support our business growth.

Sales and marketing expenses for the nine months ended September 30, 2026 were $70.5 million, compared to $45.1 million for the nine months ended September 30, 2025. The increase of $25.4 million was primarily attributable to an increase of $17.5 million in payroll-related costs, including salaries and wages, sales incentive bonuses, and stock-based compensation due to an increase in headcount of our sales force and customer care team in connection with the expansion of our sales territories within the United States. The remaining increase includes HCP-related marketing and training and travel-related costs to support our business growth.

General and Administrative Expenses

General and administrative expenses for the three months ended September 30, 2026 were $9.8 million, compared to $7.9 million for the three months ended September 30, 2025. The increase of $1.9 million was primarily attributable to a $2.1 million increase in software-related expenses, professional service fees and payroll-related expenses, including stock-based compensation, due to an increase in headcount. These increases were partially offset by a decrease in legal fees.

General and administrative expenses for the nine months ended September 30, 2026 were $29.1 million, compared to $22.4 million for the nine months ended September 30, 2025. The increase of $6.7 million was primarily attributable to an increase of $3.7 million in payroll-related expenses, including stock-based compensation, due to an increase in headcount, as well as increases of $3.5 million in software-related expenses, quality remediation expenses, and professional service fees. These increases were partially offset by a decrease in accounting and legal fees.

Other Income (Expense)

Total other income (expense), net for the three months ended September 30, 2026 was $2.3 million of income, compared to $2.8 million of income for the three months ended September 30, 2025. This change of $0.6 million was primarily attributable to lower interest income on investments, reflecting a reduction in invested balances as IPO proceeds were used to fund operating activities.

Total other income (expense), net for the nine months ended September 30, 2026 was $6.8 million of income, compared to $4.2 million of expense for the nine months ended September 30, 2025. This change of $11.0 million was primarily attributable to the absence of a loss from the change in fair value of warrant liabilities in the current period, as the warrants were remeasured and net exercised in connection with our IPO in January 2025, partially offset by lower interest income on investments, reflecting a reduction in invested balances as IPO proceeds were used to fund operating activities.

Selected Quarterly Financial Information

The following tables set forth our selected unaudited quarterly statements of operations data for each of the eight quarters in the period ended September 30, 2026. The information for each of these quarters has been prepared in accordance with GAAP, on a basis consistent with our unaudited condensed financial statements included elsewhere in this Quarterly Report and our audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2025 and include, in our opinion, all normal recurring adjustments necessary for the fair presentation of the results of operations for the periods presented, with the exception of adjusted earnings before interest, taxes, depreciation and amortization (EBITDA), which is a non-GAAP financial measure discussed below. Our historical quarterly results are not necessarily indicative of the results that may be expected in the future and these quarterly results are not necessarily indicative of our operating results for a full year. The following quarterly financial information should be read in conjunction with our financial statements and related notes thereto included elsewhere in this Quarterly Report.

The following tables set forth our selected unaudited quarterly statements of operations data for the periods presented:

(1)

Includes stock-based compensation expense as follows:

The following tables set forth our selected unaudited quarterly key business metrics for the periods presented:

Adjusted EBITDA

In addition to our financial results determined in accordance with GAAP, we believe the following adjusted EBITDA non-GAAP measure is useful in evaluating our operating performance. We use adjusted EBITDA to evaluate our ongoing operations and for internal planning and forecasting purposes. We believe that this non-GAAP financial measure, when taken together with the corresponding GAAP financial measures, provide meaningful supplemental information regarding our performance by excluding certain items that may not be indicative of our business, results of operations, or outlook. However, non-GAAP financial information is presented for supplemental informational purposes only, has limitations as an analytical tool and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP. In addition, other companies, including companies in our industry, may calculate similarly-titled non-GAAP measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our non-GAAP financial measures as tools for comparison. A reconciliation is provided below for adjusted EBITDA to the most directly comparable financial measure stated in accordance with GAAP. Investors are encouraged to review the related GAAP financial measures and the reconciliation of this non-GAAP financial measure to its most directly comparable GAAP financial measure, and not to rely on any single financial measure to evaluate our business.

The following table presents a reconciliation of adjusted EBITDA from the most comparable GAAP measure, net loss, for the eight quarters in the period ended September 30, 2026:

(1)

Amounts presented under “Quality system remediation” for the three months ended December 31, 2025, March 31, 2026, June 30, 2026, and September 30, 2026 reflect the same category of expenses previously labeled “Other non-recurring” in our Form 10-K for the year ended December 31, 2025. These expenses relate to our one-time remediation efforts in response to the Form 483 and the Warning Letter, including contractor support and the various updates to our quality system to meet FDA expectations.

Adjusted EBITDA is a key performance measure that we use to assess our operating performance. Because adjusted EBITDA facilitates internal comparisons of our historical operating performance on a more consistent basis, we use this measure for business planning purposes.

We calculate adjusted EBITDA as net loss adjusted to exclude (i) depreciation expense, (ii) stock-based compensation expense, (iii) interest income, (iv) income tax expense (benefit), (v) litigation settlement and other related expenses, (vi) quality system remediation and (vii) change in fair value of warrant liabilities.

Some of the limitations of adjusted EBITDA include: (i) adjusted EBITDA does not properly reflect capital commitments to be paid in the future and (ii) although depreciation expense includes non-cash charges, the underlying assets may need to be replaced and adjusted EBITDA does not reflect these capital expenditures. Our adjusted EBITDA may not be comparable to similarly titled measures of other companies because they may not calculate adjusted EBITDA in the same manner as we calculate the measure, limiting its usefulness as a comparative measure. In evaluating adjusted EBITDA, you should be aware that in the future we will incur expenses similar to the adjustments in this presentation. Our presentation of adjusted EBITDA should not be construed as an inference that our future results will be unaffected by these expenses or any unusual or non-recurring items. When evaluating our performance, you should consider adjusted EBITDA alongside other financial performance measures, including our net loss and other GAAP results.

Selected Quarterly Trends

Net sales

Net sales generally increased across the periods presented, primarily due to higher sales volumes, driven by continued growth in new patient starts and the installed base, which resulted in higher sales of both iLets and supplies. The quarterly trend reflects continued commercial adoption of the iLet and growth in our installed base, with seasonal decreases in net sales in the first quarters of 2026 and 2025 compared to the immediately preceding fourth quarters.

Cost of sales

Cost of sales generally increased across the periods presented, primarily driven by higher sales volume, including increased pharmacy channel iLet sales, partially offset by improved manufacturing efficiencies. Cost of sales increased in the third quarter of 2026 compared to the second quarter of 2026, primarily due to higher sales volume and a less favorable product mix within the DME channel, reflecting a higher contribution from DME supplies and a lower contribution from DME iLets. Consistent with seasonal sales trends, cost of sales decreased in the first quarters of 2026 and 2025 compared to the immediately preceding fourth quarters.

Gross Margin

Gross margin generally improved across the periods presented through the second quarter of 2026, driven by lower material costs, increased production volumes, and improved manufacturing cost absorption. Gross margin decreased to 57.3% in the third quarter of 2026 from approximately 59% in the second quarter of 2026, primarily due to unfavorable product mix within the DME channel.

The proportion of new patient starts reimbursed through the PBP remained in the high-30% range in the third quarter of 2026, consistent with the first and second quarter of 2026.

Operating expenses

Research and development expenses generally increased over the periods presented, reflecting the timing of various clinical trial-related expenses, as well as increased engineering, materials, third-party consulting and payroll-related costs to support ongoing product development and enhancement efforts, including Mint, our patch pump, the bihormonal system, and incremental software and product updates.

Sales and marketing expenses increased across the periods presented, primarily driven by higher payroll-related costs associated with expansion of the sales force and customer care team, as well as increased marketing efforts.

General and administrative expenses generally increased over the periods presented, primarily due to higher payroll-related costs to support growth.

Adjusted EBITDA

Adjusted EBITDA fluctuated across the periods presented, reflecting the impact of revenue seasonality, continued investment in operating expenses and changes in gross margin. Adjusted EBITDA improved through the second half of 2025 as revenue growth, improved gross margins and operating leverage more than offset increases in operating expenses. Adjusted EBITDA declined in the first quarter of 2026 compared to the fourth quarter of 2025, remained relatively consistent in the second quarter of 2026, and declined further in the third quarter of 2026, primarily reflecting continued investment in operating expenses to support commercial growth. Variability across the periods presented was also impacted by discrete items, including a milestone payment to Xeris in the fourth quarter of 2024 and quality system remediation expenses beginning in the fourth quarter of 2025 and continuing through 2026.