Good day and welcome to the MIOMO second quarter 2026 financial results conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there'll be an opportunity to ask questions. To ask a question, you may press star, then one on your telephone keypad. To withdraw your question, please press star, then two. Please note this event is being recorded. I would now like to turn the conference over to Vivian Cervantes, Investor Relations. Please go ahead.

Thank you, operator, and good afternoon, everyone. This is Vivian Cervantes with Alliance Advisors IR. Welcome to the MIOMO Second Quarter 2026 Financial Results Conference Call. With me today are MIOMO's Chief Executive Officer, Paul Gudonis, and Chief Financial Officer, Dave Henry. Before we begin, I'd like to caution listeners that statements made during this call by management other than historical facts are forward-looking statements. The words anticipate, believe, estimate, expect, intend, guidance, outlook, confidence, target project, and other similar expressions are typically used to identify such forward-looking statements. These forward-looking statements are not guarantees of future performance and may involve and are subject to risks and uncertainties and other factors that may affect MIOMA's business, financial condition, and operating results. These risks, uncertainties, and other factors are discussed in MIOMA's filings with the SEC. Actual outcomes and results may differ materially from what's expressed or implied by these forward-looking statements. Furthermore, except as required by law, MIAMO undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this call, today, August 5, 2026. It's now my pleasure to turn the call over to MIAMO CEO, Paul Gudonis. Paul, please go ahead.

Thanks, Vivian, and good afternoon, everyone. Thank you all for joining us today. Our mission here at Myomo remains straightforward, to restore function and independence to people living with chronic arm and hand paralysis. Every day, we hear from patients whose lives have been changed by the MyoPro, individuals who can once again feed themselves, carry groceries, return to work, or simply use both hands for everyday activities. This mission and our goal to serve a much larger number of patients continue to guide every decision we make. From a business perspective, the second quarter demonstrated continued progress in executing the strategy we introduced earlier this year. Rather than relying primarily on direct-to-consumer marketing, we're building a more durable and scalable business by evolving our go-to-market strategy by emphasizing recurrent patient referrals, expanding reimbursement coverage, tightly managing our operational execution, and continuing our market leadership through innovation on our wearable robotics platform. Importantly, we're seeing measurable progress across all four of our success pillars, which I set out earlier this year. Our first success pillar is the shift to recurring patient sources. Overall revenue for the second quarter increased 21% year-over-year to $11.7 million, and Recurring Patient Sources represented 53% of total revenue during the quarter. That's double the 26% of revenue from these sources a year ago. Our shift to Recurring Patient Sources is resulting in an improvement in patient quality as well. The conversion rate of referral leads into pipeline ads is significantly higher than the conversion rate of advertising source leads to pipeline ads. We added more than 150 referral sites bringing us to over 300 active locations, with a growing number already referring a second patient or more. O&P revenue doubled versus the prior year, and the out-of-box care national rollout is progressing well alongside discussions with other national O&P organizations. Our second success pillar is to increase market access. We've signed additional LVANCE state contracts under our national agreement, further expanding our in-network footprint, among other payer relationships established in the quarter, we are now in network with Optum's workers' compensation product, which is a part of UnitedHealthcare. The benefit of being in network is higher authorization rates from contracted payers, a still small but growing number of cases we're seeing higher authorization rates compared with non-contracted payers, which demonstrates the value of these agreements in improving patient access and reimbursement efficiency. Meanwhile, we continue to serve a growing number of Medicare Part D patients with a 100% reimbursement rate for patients with the complete medical documentation supporting the delivery of a MyoPro to them. Our third success pillar is to demonstrate operating leverage. As I mentioned, revenue increased 21% while operating expenses grew only 1%. And we improved our adjusted EBITDA by over $3 million compared to the second quarter of last year. Revenue for Employee continues to improve as we implement new systems and efficient processes. In our manufacturing organization, we now have a trained Six Sigma team that has been executing cost reduction initiatives, which include the mobile app rollouts to replace the cost of a laptop for each device. We're using our new facility here in Burlington, Massachusetts to expand in-house assembly from outsourced contractors and we've made a very new investment in 3D printing capabilities. We still remain confident that these and other initiatives will result in expanding margins and lower cash burn. We're demonstrating the ability to grow revenues at a faster rate than operating expenses, which puts us on the path to profitability and sustainable positive cash flows. Our fourth success pillar is continued progress on product developments and clinical research. Development of the next generation MyoPro3 continues on schedule. At the OT World Conference in Germany in May, which is the largest OT industry event in Europe, we introduced a hand-only prototype for the German market, thus expanding future market opportunities by serving the patient population that needs only a device for hand function. This is the latest example of building upon our wearable robotics platform, which now includes a cloud-based data collection system and mobile app for communicating with patients and clinicians. Meanwhile, we're making good progress at the University of Utah randomized control trial which has enrolled 25 of 50 patients and an updated six-month outcomes publications plan for the second half of this year. As you can see, the key operating methods continue to move forward in the right direction for expanding recurring referral sources, increasing payer access, demonstrating operating leverage, investing in innovation based on our platform, and most importantly, helping more patients regain the use of their arms and hands. And some additional highlights in the quarters I wrap up my remarks. The evolution in our go-to-market strategy to recurring patient sources is yielding terrific results, including record quarterly orders, totaling 255 MyoPro units in the second quarter. One example of how the strategy is working is the case of Barbara, who was referred to myoma by her therapist at a major rehab hospital in New Jersey, where she'd be attending therapy after her stroke. Barbara is 14 months post-stroke, and it plateaued with her upper extremity progress. With limited ability to use her right arm, the therapist contacted us as a potential MyoPro candidate. After positive evaluation, her physician provided the necessary medical documentation, The MyoPro was authorized by her health insurance plan Blue Cross Blue Shield within 30 days of the assessment, and she was fit with her custom MyoPro within 90 days of the referral. And she's doing well. She's making great progress with her therapy and training on how to use her new MyoPro. She's also able to take advantage of our recently released four-finger saddle, which will help improve her functional grasp for the activities of daily living, which she can now do at home. Arbor's case exemplifies the effectiveness of our patient referral program, which engages recurring rehabilitation sources at the point of care to advance the patient's return to mobility and independence and can lead to a faster revenue cycle. I'd also like to highlight that we enhanced our board with the appointment of Joe Manko of Horton Capital, one of our largest shareholders, and Will Feble, a seasoned healthcare and med tech executive. Our expanded board strengthens our governance framework and strategic capabilities by adding directors with significant industry experience, financial expertise, and proven leadership in building shareholder value. With that overview, I'll now turn the call over to Dave Henry to review our financial results in greater detail.

Thank you, Paul, and good afternoon, everyone. As Paul just discussed, our go-to-market evolution continues to gain traction, and I'm pleased to report another quarter of solid financial and operational execution. Our revenue for the second quarter of 2026 was 11.7 million, up 21% versus the prior year period. The increase was driven by both a higher average selling price, or ASP, and a higher number of revenue units. ASP for the quarter was approximately $55,500, up about 2% versus the prior year, and we recognized revenue on 211 mile-per-units, an increase of 19% over the second quarter of 2025. Looking at payer mix, Medicare Part D patients represented 50% of second quarter revenue, compared with 56% in the prior year period. Medicare Advantage plans represented 16% of second quarter revenue compared with 20% in the prior year period. A transition toward recurring patient sources continued to accelerate during the quarter. Recurring patient sources represented 53% of second quarter revenue compared with 26% in the prior year quarter, achieving our objective of 50% of revenues from recurring patient sources six months ahead of schedule. Within these recurring channels, 23% of total revenue is generated by direct billing referrals through our MyoConnect program, up from 20% in the first quarter. We also continue to see strong momentum from our other recurring channels, with international revenue representing 17% of revenue, growing 32% year over year, and the USOMP channel representing 10% of revenue, growing 130% year over year. VA patients represented 3% of revenue in the second quarter. Turning to our metrics, we've received a record 255 MyoPro orders during the quarter of 23% year over year. Higher conversion of orders to revenue affects the efficiency of our operations as 57% of second quarter revenue units came from orders received during the quarter. We added 739 patients to the pipeline during the quarter up 2% sequentially. Advertising spending was up 11% sequentially. Pipeline ads in the quarter were impacted by maintenance activities on our website, which resulted in a temporary pause in data sharing with our digital ad agency. Those activities have been completed, and the website is functioning normally. Patient quality in the pipeline is improving, however, as 17% of pipeline ads in the second quarter were generated by direct billing referrals, which is reflective of our progress in adding referring sites and is an increase of 11% in the first quarter. To illustrate the impact of MyoConnect, typically about 25% of our pipeline ads on a quarterly basis are Medicare patients. Looking at only MyoConnect pipeline ads so far in 2026, roughly 50% of patients entering the pipeline are Medicare patients. As a result, increasing direct billing referrals combined with our continuing market assets efforts are improving patient quality and are starting to translate into a higher authorization rate as well. We ended the quarter with a backlog of 218 patients down modestly from the first quarter as higher revenue velocity offset stronger order growth. Turning to our financial results, gross margin for the second quarter was 72.1%. up from 62.7% in the prior year quarter. The improvement was driven primarily by the higher ASP, lower overhead spending, and the favorable impact of material cost reductions, including the rollout of the Myoma mobile app, partially offset by somewhat higher clinical costs reclassified the cost of goods sold. Operating expenses were 10.7 million, representing an increase of less than 1% compared with the second quarter of 2025. higher general and administrative expenses offset lower advertising and R&D spending. Operating loss improved significantly to 2.3 million compared with 4.6 million in the prior year quarter. Adjusted EBITDA improved to a loss of 800,000 compared with a loss of 4 million a year ago representing a 79% year-over-year improvement. Note that a portion of the improvement in adjusted EBITDA is due to higher stock-based compensation expense as certain employee incentive payments were paid in stock during the quarter as part of our cash management initiatives. Below operating loss, second quarter results include a non-cash charge of approximately $1.2 million related to a marked adjustment on the valuation of our derivative liabilities as well as cash and non-cash interest expense associated with the Avenue capital term loan. including these non-cash charges, net loss for the quarter was $4 million or $0.09 a share compared to the $4.6 million or $0.11 per share in the second quarter of 2025. Turning now to our balance sheet and cash flow, as of June 30th, 2026, cash, cash equivalents and short-term investments totaled $13.5 million. Cash used in operating activities during the second quarter was $1.9 million. a substantial improvement compared with 8.9 million used in the second quarter of 2025. Prior year cash spring was impacted by a temporary payment hold imposed by the D&D Max and payment of 2024 incentive payments in cash. Let me conclude with our outlook. For the third quarter, we expect revenue to be in the range of 11.5 million to 12 million, representing 14 to 19% year-over-year growth. Given the strong first half performance and continued momentum across the business, we're raising our full-year revenue guidance to a range of $45 million to $47 million, up from our previous guidance of $43 million to $46 million. We expect a modest sequential increase in operating expenses in the third quarter. We're also maintaining our previously communicated operating leverage objective to limit the growth of operating expenses in 2026 to half the rate of revenue growth. In addition, we expect total cash burned during the second half of the year to be less than $2 million. Overall, we're very pleased with the progress we're making, the evolution of our go-to-market approach, continued improvement in operating leverage, and strong execution position as well for the balance of 2026. With that financial overview, I'll turn the call back to Paul.

Thanks, Dave. Well, to summarize, we're keenly focused on implementing our four success pillars. to grow MyoPro volume and revenues while improving the key financial metrics including gross margin, adjusted EBITDA, and cash usage. We've now delivered over 3,000 devices to patients, and our technology platform is making a dramatic difference in their lives. and while we've established Myomo as the market leader in addressing this large unmet need, we're still at the early stage of market penetration with a prevalence population of hundreds of thousands of qualified individuals who are suffering with chronic arm paralysis and tens of thousands more each year going through rehab clinics that could be potential Myopro candidates as well. Now, Dave and I are ready to take your questions. Operator?

Thank you. We will now begin the question and answer session. To ask a question, you may press star, then 1 on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you'd like to withdraw your question from the queue, please press star, then 2. At this time, we will pause momentarily to assemble our roster.

While we're waiting for the first question, I'd like to mention that in September, we'll be participating in the H.C. Wainwright 28th Annual Global Investment Conference in New York on September 14 and 15. We'll attend in person at this conference and are available for one-on-one meetings. Okay, operator, let's take the first question when you're ready.

Absolutely. Our first question comes from Chase Knickerbocker of CHLM. Please go ahead.

Hi, everyone. This is Jake. I'm for Chase. Congrats on the results. Thanks for taking the questions. We're clearly inflecting back to growth here. Do you mainly attribute this to MyoConnect? Are you seeing much higher conversion rates of these patients that come through MyoConnect? And then also, what portion of the pipeline is now made up of MyoConnect referrals?

You're right. We see the MyoConnect program really gaining momentum here. We're adding more sites, you know, up to 300 referral sites. And what we're seeing is, as Dave mentioned, now we have better medically qualified patients because the therapists have been informed by us, you know, who makes the good MyoPro candidates, they tend to have better insurance. You know, so the larger percentage of them have Medicare Part B, which is easier to get reimbursed for that patient. So that MyoConnect program is really driving the growth, but I also have some other growth drivers. Our own tea business is growing. In fact, we'll be at the AOPA National Conference next month. continue building relationships over there. And Europe is growing strongly as well. So we've got multiple growth drivers going on over here. I think Dave's going to answer your question about the pipeline.

As I mentioned, there were 17% of our pipeline ads in the quarter were from the MyOpConnect referrals. That was up from 11% in the first quarter. And so that's about 150 122, I believe, referrals. Referral pipeline, yeah.

Thank you. Thanks for that, Colin. And then just one more for me. How are you thinking about readout timing for the Utah RCT, and what's going to be the chief benefit that you will reap here assuming good data? Is it predominantly increasing covered lives outside of Part B, or do you expect it to help with demand generation in O&P and within MyoConnect?

Well, I believe the answer to the second part is all of the above. I think we'll be able to go with our chief medical officer to medical directors at various payers and make the case that the myoprobe is not experimental, it's not investigational. It's proven. It's being covered by Medicare and other payers. Thousands of people are already benefiting from it. And here's more research data about it. As I mentioned, we have 25 of the 50 patient subjects already in the study. We'll do a readout at six months. And then we expect the full publication sometime in 2027. Great.

Thank you.

Our next question comes from Scott Henry of AGP. Please go ahead.

Thank you, and good afternoon. Starting with a couple of questions on the metrics. First, when you talk about the 255 orders, is that the same as what historically was referred to as authorizations?

Same thing, yes.

Okay.

Scott, it's a combination of insurance authorizations that we get from our direct billing operation and then orders, POs, we get from an O&P provider or a PO from a VA.

Okay. And historically, you've given us the reimbursement cumulative pipeline. Do you still have that number or are we going to get that or not?

Yeah, the overall pipeline at the end of the quarter was... 1,491 patients.

Okay, so that's a little lower, but is there some rationalization of that? I know sometimes you kind of take some people out, you change, it's not always apples to apples.

Yeah, yeah, I mean, there's, I mean, remember, we, you know, with all of the, with the but the challenge is trying to get Medicare Advantage patients authorized. A lot of them stick in the pipeline a while. So I think looking at pipeline ads because they're sort of closer, particularly as we migrate towards MyoConnect, I think that's probably a better metric to kind of look at instead of the overall pipeline and who might be stuck in there longer term. So I would focus on the pipeline ad.

Okay. And in there, I think the number was 739. Do you think that's a good number? Yeah. Is that a reasonable number going forward? Yeah.

And as I mentioned, you know, that 739 included, you know, the 122 referral pipeline ads. And as I said, roughly, so far this year, roughly half of Myoconnect pipeline ads are Medicare. So that compares with 25% for the overall program, which is driven by the advertising. So we're getting, we're seeing much better patients under Myoconnect, ones that are, that have fewer contraindications. They're closer to their pre-stroke life. They are, it's easier to obtain their reimbursement documents. And oh, by the way, more of them are Medicare. So it's all – that really kind of explains why we're doing what we're doing.

Okay. And then, you know, we are going into a midterm election year, and it sounds like it's going to be a pretty active midterm, which can clog up the media and impact your ability to get the message out there. How should we – you know, do you think that will have any impact? on the back half of the year?

Well, typically, fourth quarter of every year, we tend to scale back to direct-to-consumer advertising for some of the reasons you mentioned, Scott. This year, it's an election year, so there's more competition for those eyeballs. There's also the holiday advertising that we have to deal with and so on. So that's why we're going to keep emphasizing our MyoConnect program. We're growing the number of people in the field with sales and clinical expertise to build more referral sites, and that's pretty immune from the advertising aspects.

Okay, great. I got a final question. If we look at operating income, because I know there's a lot of noise by the time you get down to net loss, $2.2 million in the quarter was a pretty good quarter. We haven't seen many in the first digit there. Do you think we're now at a stage where, you know, it might even improve from this level? Or how should we think about operating income, you know, sequentially as we go through the year and onward?

I guess I would kind of look at the components of it. It might be easier to answer the question. So, you know, we've given the revenue guidance. you know, the gross margin, you know, we were at 72%. I don't know why that would go down. We are, you know, cost reductions continue at pace. We have more that are planned that will reduce manufacturing costs here in the second half of the year. And, you know, typically, you know, second half revenues are stronger than first half revenues and we will get the leverage impact of that. Then in terms of the operating expenses, I said that we would expect some modest operating expense growth in the third quarter. And then fourth quarter, it's not going to, I don't expect fourth quarter to be higher than third. And so I would expect it to be along those same lines, I would say. And so that should then translate then into for the improvement in operating loss as we go through the rest, as we finish up the year here with, you know, presumably given our full year guidance, you know, that does sort of lead to higher fourth quarter revenue.

Okay, great. Thank you for the color there, and thank you for taking the questions. Yep.

Our next question comes from Jeremy Perlman of Maxim Group. Please go ahead.

Okay, good afternoon. Thank you for taking the question. Firstly, regarding, you still have, you know, really great on the Model Connect, the referrals, you six months had a schedule to reach over 50%, but still roughly 50% is generating from direct consumer, direct to patient marketing. Maybe talk about how has that evolved since the beginning of the year and how do you think that will evolve through the rest of 2026? And what type of, how are you, you know, spending your advertising dollars, your marketing dollars in that bucket?

Yeah, I would expect that part of the modest increase in operating expenses is an expected increase in ad spending in third quarter. That's something we typically do before we take our foot off the gas on advertising spending a little bit in the fourth quarter. Advertising spending is still an important part of what we're doing, and the advertising driven revenues are still an important part of what we're doing. I just want to make sure that people understand we're not turning those off. It's going to be an important part of our business on an ongoing basis. We just want to see a greater mix of revenues coming from recurring patient sources.

Right. Understood. So where do you think that could, you know, ultimately, where do you think that could stabilize that percentage of referrals versus your direct-to-consumer?

I think as we look towards the end of the year, I mean, we had a goal of 50. I think 55% probably might be a reasonable number to exit the end of the year. And then longer term, I think we're going to be in a position where MyoConnect is starting to mature here as we get toward the end of the year. So maybe a 64-ish kind of split, something like that, longer term. might be where we land.

Okay, great. And just last question on this referral program, you know, not just the MyoConnect, but, you know, in peak clinics and the VA, I'm sure you've done the due diligence. You know, how much more runway do you have because you said you have 300, roughly 300, you know, referrals, whatever you want, I don't know how you refer them to, but referrals, that are referring myopro patients to you, how much more runway do you have, you know, just number of actual clinics you could sign up or OMP clinics regardless?

There are several thousand stroke rehab clinics around the country, whether they're affiliated with major hospitals like Spalding Rehab here in Boston or Kessler and so on. But there's a lot of smaller neuro clinics around the country that see stroke patients. So we're just at the early stage of this. And the MyoConnect program has two growth factors. One, increased penetration, more awareness. by the therapists and the doctors at these rehab clinics, but also kind of what I'll call same-store sales growth. We're already starting to see that after their first referral, they'll make a second referral, and hopefully over time, as they see their patients benefiting from the MyoProbe, we'll see an increasing number of referrals per site. So I see two drivers here that kind of lead to exponential growth, more referral sites, and then more patients referred per site over time. The same thing with the O&P clinics. The revenue is still relatively small out of the total mix. I mean, there are several thousand O&P clinics around the country. We have regular meetings with the senior executives of the ones that have been put together as national players. and we're looking to increase our penetration among their clinicians and offices and continuing to find more entrepreneurial OT clinics around the country as well. So that's another growth factor, not only here in the U.S., but also in Germany.

Great. Okay, great. Thank you so much for taking my questions. I'll jump back in the queue. You're welcome.

Once again, if you have a question, please press star then one. Our next question comes from Edward Wu of Ascendant Capital. Please go ahead.

Congratulations on all the progress. My question is on international. It sounds like you're going to be introducing a hand-only device in Germany. Will it only be in the German market, and would you be bringing it into the U.S. market?

Well, it's a very exciting new product development and I was over in Leipzig, Germany in May with our team introducing this prototype which is under development. The reason we're starting in Germany is because a hand-only product will be reimbursed in Germany. There's already a small competitor, HKK, which already has a hand-only device. We're bringing our technology platform to build a superior device to that. And we know it will get reimbursed in Germany, so we're starting there. And then we can work on how we get the appropriate HCPCS codes here in the U.S. to support rollout here in the U.S. because there's certainly this patient demand for people who can move their upper arm, but they don't have the distal function. So this would be available and it expands our adjustable market with this new product off our technology platform.

Is it going to require significant R&D or is it already built into your plans for OpEx?

We will be covering that in our OPEX plans here. You know, it's not a major redo of the product. It's really breaking off the mobile motor, investing in the way of sensors and power of the unit. So it's a relatively small R&D investment compared to the MioPro3.

Great. Well, thank you, and I wish you guys good luck.

Thank you, Ed.

This concludes the question and answer session. I would like to turn the conference back over to Paul for any closing remarks.

Thanks, Operator, and thank you all for joining us today and for your questions. We look forward to seeing and hearing from you in the coming months. Again, thanks again, and have a good evening.

This concludes today's conference call. You may now disconnect your lines. Thank you for participating, and have a pleasant day.