Spectral AI Inc (NASDAQ:MDAI) reported a strong financial performance for the third quarter of 2024, highlighted by a 138% increase in research and development revenue as it advanced its burn wound technology.
For Q3 2024, the company posted $8.2 million in revenue, up from $3.4 million in the same quarter last year.
The surge was driven primarily by increased activity on the company's Project BioShield (PBS) contract with the Biomedical Advanced Research and Development Authority (BARDA) and additional US government contracts.
Gross margin improved to 44.9%, up from 42.8% in Q3 2023, reflecting the higher revenue base and increased development activity.
Spectral AI's DeepView AI-Burn system, which leverages artificial intelligence to enhance the diagnosis and treatment of burn injuries, has reached a critical milestone with the completion of clinical visits for the final group of patients in its US Burn Pivotal Study. The company expects to release top-line results from the study by December 2024.
The company also announced the completion of a proof-of-concept module for its wound measurement technology, which it believes will offer a more accurate and standardized way to measure burn injuries.
In addition, Spectral AI secured over $850,000 in new funding from the Medical Technology Enterprise Consortium (MTEC) to further develop its DeepView SnapShot M, a handheld device aimed at battlefield burn assessments.
“My confidence in the potential of DeepView AI-Burn to change the standard of care in burn wound assessment and improve patient outcomes has never been greater,” Dr Michael DiMaio, chair of Spectral AI said in a statement.
“We are fortunate to have the support of a team of dedicated professionals, an engaged and committed management team and Board, and $150 million of non-dilutive US Government funding to advance our technology towards commercialization.”
Spectral AI ended Q3 2024 with $3.7 million in cash, and the company reiterated its 2024 revenue guidance of approximately $28.0 million.
Earlier today Spectral AI announced plans to spin off its Spectral IP subsidiary into an independent publicly traded entity. The move is designed to maximize shareholder value and further support the company's regulatory and commercialization goals.
Financial highlights
- Revenue: $8.2 million in Q3 2024, a 138% increase year-over-year.
- Gross Margin: 44.9%, up from 42.8% in Q3 2023.
- Operating Loss: Narrowed to $0.9 million, compared to a loss of $4.2 million in Q3 2023.
- Net Loss: $1.5 million or $0.08 per share, significantly improved from a net loss of $10.6 million or $0.77 per share in the prior year. The Q3 2024 loss included $1.1 million in borrowing costs, compared to no such costs in Q3 2023.
- Adjusted EBITDA: A loss of $0.7 million, improved from a loss of $3.9 million in Q3 2023.