STXS 10-K & 10-Q changes, risk factors and insider trading

Macroeconomic and geopolitical factors, as well as pandemics, epidemics or outbreaks of infectious disease could have an adverse effect on our supply chain, our hospital customers buying patterns, and our ability to raise capital and could otherwise disrupt our normal business operations.

Future results of operations and liquidity could be materially adversely impacted by uncertainties in macroeconomic and geopolitical factors.factors in both the U.S. and globally including continuing introduction of new or modification of existing tariffs or trade barriers, supply chain challenges, inflationary pressures, elevated interest rates, and disruptions in commodity markets stemming from conflicts, such as those between Russia and Ukraine and conflicts in the Middle East, including Israel and Iran. The Company continues to experience difficulties with periodic worldwide supply chain disruptions, including shortages and inflationary pressures, tariffs and other trade regulations that are or may be imposed, and logistics delays which make it difficult for us to source parts and ship our products. We have generally been ablecontinue to conductevaluate normalthe macroeconomics business activitiesenvironment, albeit in a more deliberate manner than prior to the pandemic, including taking action to increase inventory levels where appropriate and engaging in discussions with our vendors on contractual obligations, but we cannot guarantee that theyour business activities will not be impacted more severely in the future. Our suppliers and contract manufacturers have experienced, and may continue to experience, similar difficulties. If our manufacturing operations or supply chains are materially interrupted, it may not be possible for us to timely manufacture or service our products at required levels, or at all. Changes in economic conditionsconditions, government shutdowns, tariff escalation, retaliatory measures and supplynew chainimport constraints restrictions could lead to higher inflation than previously experienced or expected, which could, in turn,turn leadcreate tosupply shortages anas increasecompanies inseek costs.alternative Wesources of supply and adjust their logistics and transportation routes. As a result of these factors, we may be unable to raise the prices of our products sufficiently to keep up with the rate of inflation, especially tariff-induced inflation. A material reduction or interruption in any of our manufacturing processes or a substantial increase in costs would have a material adverse effect on our business, operating results, and financial condition.

Many of our hospital customers, for whom the purchase of our system involves a significant capital purchase which may be part of a larger construction project at the customer site (typically the construction of a new building), may themselves be under economicsimilar pressures. Hospitals continue to experience challenges with staffing and cost pressures as supply chain constraints and inflation drive up operating costs. ThisHospitals may also be adversely affected by the liquidity concerns driven by elevated interest rates and the broader macroeconomic environment. These factors could cause delays or cancellations of current purchase orders and other commitments and may exacerbate the long and variable sales and installation cycles for our robotic magnetic navigation systems. Our hospital customers have also experienced challenges in sourcing supplies, such as catheters, needed to perform procedures. Such shortages have, and may continue to, put pressure on procedures and our disposable revenue. Delays in order placement, cancellation of existing orders and reduced demand or availability of our disposable products all would have a material adverse effect on our business, financial condition, and results of operations.

PandemicsIn addition to the macroeconomic factors, occurrences similar to the COVID-19 pandemic may negatively affect demand for both our systems and our disposable productsproducts. inIn the future.past, For example, during the COVID-19 pandemic, we had negative demand for our products, and generallyhave experienced other business disruptions, such asincluding travel restrictions on us and our third-party distributors, distributors. All of thiswhich negatively affected our complex sales, marketing, installation, distribution and service network relating to our products and services, and that may occur again in the future if we experience another pandemic or a significant resurgence of COVID-19.services. We also experienced reductions in demand for our disposable products as our healthcare customers (physicians and hospitals) re-prioritized the treatment of patients and diverted resources away from non-pandemic related areas, leading to the performance of fewer fewer procedures in which our disposable products are used. The impact varied widely over time by individual geography. For instance, in 2022, procedure volumes were challenged by periodic resurgences of COVID-19, ongoing hospital staffing issues and other factors. In the first quarter of 2023, COVID-19 resurgences in China continued to negatively impact our procedure volumes in that region, but as infections and hospitalization decreased, we saw a recovery of procedure volumes with no further impacts in the year. Significant decreases to our capital or recurring revenues could have a material adverse effect on our business, operating results, and financial condition. We Whilecontinue we cannot reliablyto anticipate whether there will be new or periodic resurgences of pandemic-related issues, or the impact or the severity of any such pandemics or resurgences, we believe that any such instances could cause periodic disruptions to our manufacturing operations, supply chains, procedures volumes, service activities, activities, and capital system orders and placements,placements relating to new or ongoing periodic resurgences of pandemic-related issues, any of which could have a material adverse effect on our business, financial condition, results of operations, or cash flows. The impact has varied widely over time by individual geography.

To achieve and grow sales, hospitals must purchase our products and, in particular, our robotic magnetic navigation systems. The robotic magnetic navigation system is a novel device, and hospitals and physicians are traditionally cautious in adopting new products and treatment practices. In addition, hospitals may delay their purchase or installation decision for the robotic magnetic navigation system based on the disposable interventional devices that have received regulatory clearance or approval. Moreover, the robotic magnetic navigation system is an expensive piece of capital equipment, representing a significant portion of the cost of a new or replacement interventional lab. Although priced significantly below a robotic magnetic navigation system, theour Odyssey and Synchrony Solution isare still anexpensive products. expensiveFurther, product. Whilewhile we have partnered with fluoroscopy manufacturers to reduce the cost of acquisition, the ongoing cost of ownership, and the complexity of installation of a robotic electrophysiology practice, this strategy may not be successful. If hospitals do not widely adopt our systems or partnered products or if they decide that our systems are too expensive, we may never become profitable. Any failure to sell as many systems as our business plan requires could also have a seriously detrimental impact on our results of operations, financial condition, liquidity position, and cash flow.

For example, supply chain disruptions have led to vendor discussions regarding contractual performance which we intend togenerally resolve through continuednegotiations, negotiationsalthough butin one instance we have been required us to assert performance issues under ourthe vendor agreements.agreement. We may not be successful in our claims, negotiations or claim, and even if we are successful, we may continue to experience supply disruptions. Our collaborators range from small and midsized organizations which may have limited resources to large, global organizations with diverse product lines and interests that may diverge from our interests in commercializing our products. Accordingly, our collaborators may not devote adequate resources to our products, or may experience financial difficulties, change their business strategy or undergo a business combination that may affect their willingness or ability to fulfill their obligations to us.

The termination or failure of one or more of our collaborations could have a material adverse effect on our financial condition, results of operations and cash flow. In addition, if we are unable to enter into additional collaborations in the future, or if these collaborations fail, our ability to develop and commercialize products could be impacted negatively and our revenue could be adversely affected. For example, example, our agreement with BiosenseJohnson Webster& Johnson expired by its terms on December 31, 2022.2022 ending the receipt of royalty payments on the J&J catheters. While thethat agreement providesprovided for a continuation of supply by BiosenseJohnson Webster& Johnson of the co-developedJ&J catheters to us or our customers for three years following the termination, wethat noobligation longerlapsed receive royaltyon paymentsDecember from31, Biosense Webster.2025. Although we are in the process of establishing alternative catheter supply arrangements, including the developmentour of a fully ownedproprietary magnetically enabled ablation catheter, we cannot guarantee that thosean arrangementsadequate alternative catheter supply will be successful. available in a timely manner. Failure to establishmaintain alternativesan adequate supply of magnetically enabled ablation catheters may reduce the likelihood that physician users will continue to use our technology which will have have a negative impact on our future revenue, cash flow and operations. Even if we are successful in establishing onean oradequate morealternate supply, alternatives, weit cannotis guaranteeunlikely that those arrangements will replace the royalty revenue stream previously received from the sale of the BiosenseJ&J Webster catheter.

We depend on contract manufacturers to produce and assemble certain of the components of our systems and other products such as our electrophysiology catheter advancement device and other disposable devices. We also depend on various third-party suppliers for the magnets we use in our robotic magnetic navigation system and certain components of our Odyssey Solution.and Synchrony & SynX Solutions. In addition, some of the components necessary for the assembly of our products are currently provided to us by a single supplier, including the magnets for our robotic magnetic navigation system and certain components of our Odyssey Solution, and we generally do not maintain large volumes of inventory. Our reliance on these third parties involves a number of risks, including, among other things, the risk that:

In addition,the ifpast, thesesome manufacturers orcritical suppliers stophave stopped providing us with the components and services necessary for the operation of our business, requiring us to identify alternate sources. We cannot guarantee that another manufacturer or supplier will not, in the future, stop providing us with components or services necessary for the operation of our business, and if that were to occur, we maycannot notguarantee that we would be able to identify alternate sources in a timely fashion.fashion Anyor transitionat all. In the past, transitions to alternate manufacturers orand suppliers has would likely resultresulted in operational problemsproblems, increased expenses, and increasedlimitations expenses and could delay the shipment of, or limiton our ability to,to provide our products. We cannot assure you that we would be able to enter into agreements with new manufacturers or suppliers on commercially reasonable terms or at all. Additionally, obtaining components from a new supplier may require a new or supplemental filing with applicable regulatory authorities and clearance or approval of the filing before we could resume product sales. Any disruptions in product flow may harm our ability to generate revenue, lead to customer dissatisfaction, damage our reputation and result in additional costs or cancellation of orders by our customers.

We rely on other parties to manufacture, and in some cases to service, magnetically compatible x-ray systems, catheter sensing technology, and a number of disposable interventional devices for use with our robotic magnetic navigation system. If these parties cannotexperience, oras some do nothave had in the past, various challenges including the ability to manufacture sufficient quantities to meet customer demand, or ifdisruption of their manufacturing processes are disrupted,processes, or ifan they are not ableinability to service or warrant their products, our revenue and profitability would be adversely affected.

Trade restrictions in the form of tariffs or quotas, or both, could also affect the importation of those product components and could increase the cost and reduce the supply of products available to us. For example, the TrumpU.S. administrationsfederal government has implemented, or is considering the imposition of, tariffs on certain foreign goods, including on our products that emanate from China as described above and we cannot predict the implementation or effects of any such tariffs or proposed tariffs, or any potential legislation or actions taken by the U.S. federal government that restrict trade, such as additional tariffs, trade barriers, and other protectionist or retaliatory measures taken by governments in Europe, Asia, and other countries, could adversely impact our ability to sell products and services, which could increase the cost of our products and the components and raw materials that go into making them. Countries may also adopt other protectionist measures that could limit our ability to offer our products and services. In addition, decreases in the value of the U.S. dollar against foreign currencies, or significant price increase from these suppliers, could increase the cost of products we purchase from overseas vendors.

We subcontract all or part of the manufacture and assembly of components of our products and devices. The products we design may not satisfy all the performance requirements of our customers and we may need to improve or modify the design or ask our subcontractors to modify their production process to do so. In addition, we, or our subcontractors, have in the past experienced and may continue to experience quality problems,problems. We, or our subcontractors, may also experience substantial costs and unexpected delays related to efforts to upgrade and expand manufacturing, assembly and testing capabilities. If we incur delays due to quality problems or other unexpected events, our revenue may be impacted.

As a result of the acquisition,acquisition of APT EP in July, 2024, we will beare managing APT’s ongoing business of manufacturing, commercializing, development developing and sales ofselling APT’s catheters and related products and services. The manufacturing process of catheters is complex, highly technical, and our prior experience in this field is dated. The process can be subject to periodic worldwide supply chain disruptions, including labor shortages and inflationary pressures, tariffs or other trade restrictions, and logistics delays which make it difficult for us to source parts and ship our products. We may require a higher level of overhead than currently anticipated. Our ability to successfully manage this new aspect of our business will depend, in part, upon management’s ability to design and implement strategic initiatives that address not only the integration of APT into us, but also the increased scope of the combined business with its associated increased costs and complexity. ThereWe canare be nostill assurances that we will be successful in manufacturing catheter products or that we will realizeintegrating the expected operating efficiencies, cost savingsbusinesses and otherimplementing benefitssafeguards anticipatedto fromminimize theany acquisition.negative impacts on our financial position, results of operations and cash flows post-acquisition.

ThePursuant to the share purchase agreementagreement, obligatedwe us to filefiled a resale registration statement relating tocovering the upfront stock consideration and additional earnout shares. This prospectus is a part of that resale registration statement and covers the 1,486,620 common shares and an estimated 4,613,380 additional earnout common shares. As of the date of this report, we have issued an aggregate of 1,419,523 shares as earnout consideration, However, the exact number of earnout shares that may be issued under the share purchase agreement for for suchfuture milestones will be calculated based on the average of the closing per share price of Stereotaxis common stock immediately prior to the dates such revenue performance and/or regulatory milestones are achieved, up to $24 million in total value through September 30, 2029, provided that the total number of shares issued under the share purchase agreement as upfront stock consideration and earnout consideration may not toexceed exceed16,846,595, which is 19.9% of the total number of shares of the Company’s common stock issued and outstanding immediately prior prior to July 31, 2024 (the “Share Cap Limitation”). In addition, the vesting of the right to receive the earnout shares would would be accelerated in the event of a change of control of Stereotaxis, based on a probability-weighted average estimate of the potential to achieve any remaining milestones, discounted to its net present value considering expected time when earnouts related to the milestones would become payable through September 30, 2029 As a result, the actual number of additional Earnout Shares we may be required to issue could be materially greater or less than our estimate, depending whether and to what extent the future revenue milestones are met and/or regulatory approvals are obtained, as well as the actual average closing price of our common stock calculated pursuant to a formula near the time such milestones are achieved and/or whether a change of control occurs. If we are required to issue Earnout Shares under the Share Purchase Agreement, there could be significant additional dilution to the Company’s stockholders. Moreover, even if we are not required to issue any Earnout Shares, the potential for the issuance of such shares may negatively affect the trading price of our common stock in anticipation of such potential dilution. Sales of a substantial number of shares comprising the Closing Shares or any Earnout Shares in the public market, or the perception that such sales may occur, could adversely affect the market price of our securities.2029.

Security breaches and other disruptions to our information technology infrastructure could interfere with our operations; compromise information belonging to us, our employees, customers, and suppliers; and expose us to liability which could adversely impact our business and reputation. In the ordinary course of business, we rely on information technology networks and systems, some of which are managed by third parties, to process, transmit, and store electronic information, and to manage or support a variety of business processes and activities. Additionally, we collect and store certain data, including proprietary business information and customer and employee data, and may have access to confidential or personal information in certain of our businesses that is subject to privacy and security laws, regulations, and customer-imposed controls. Despite our cyber securitycyber-security measures (including employee and third-party training, use of user names and passwords for access to information technology systems, monitoring of networks and systems, and maintenance of backup and protective systems) which are continuously reviewed and upgraded, our information technology networks and infrastructure may still be vulnerable to damage, disruptions, or shutdowns due to attack by hackers, breaches, employee error or malfeasance, power outages, computer viruses, telecommunication or utility failures, systems failures, war or other military conflicts, natural disasters, or other catastrophic events. We have programs in place to detect, contain, and respond to data security incidents, and we continually make improvements to our networks and systems to minimize or eliminate vulnerabilities. However, because the techniques used to exploit systems change frequently and can be difficult to detect, we may not be able to prevent these intrusions or mitigate them when and if they occur. Additionally, we rely on some information technology networks and systems managed by third parties, and we rely on these third parties to deploy appropriate measures to protect their systems and networks. Vulnerabilities in their systems could compromise the security of our own infrastructure. Any such events could result in legal claims or proceedings, liability or penalties under privacy laws, disruption in operations, and damage to our reputation, which could materially adversely affect our business. While we have experienced, and expect to continue to experience, these types of threats to our information technology networks and infrastructure, to date none of these threats has had a material impact on our business or operations.

Expensive intellectual property litigation is frequent in the medical device industry and may cause us to incur substantial expenses to defend.

Infringement actions, validity challenges and other intellectual property claims and proceedings, whether with or without merit, can be expensive and time-consuming and would divert management’s attention from our business. We have incurred, and expect to continue to incur,incur substantial costs in obtaining patents and may have to incur substantial costs defending our proprietary rights. Incurring such costs could have a material adverse effect on our financial condition, results of operations and cash flow.

Our suppliers, subcontractors, or we may fail to comply with the FDAFDA, EU and other state and foreign government authorities quality system regulation or other quality standards.

Healthcare policy changes, including the potential repeal or amendment of any existing legislation, may have a material adverse effect on us. Such changes could, among other things, reduce reimbursement for procedures using our products, change coverage policies, increase compliance costs, and delay or reduce hospital capital spending.

We generally warrant each of our products against defects in materials and workmanship for a period of 12 months following the installation of our system. Additionally, we rely on the warranty provided by our third-party suppliers, including our fluoroscopy system providers. If product returns or warranty claims increase, or ifif, as has occurred in the past, our third-party suppliers do not honor their warranty obligations to us or certain claims are not covered thereunder, we could incur unanticipated additional expenditures for parts and service. In addition, our reputation and goodwill in the interventional lab market could be damaged. Unforeseen warranty exposure in excess of our established reserves for liabilities associated with product warranties could materially and adversely affect our financial condition, results of operations and cash flow.

These factors, as well as general economic, credit, political and market conditions, may materially adversely affect the market price of our common stock. As with the stock of many other public companies, the market price of our common stock has been particularly volatile during the recent periodperiods of upheaval in the capital markets and world economy. This excessive volatility may continue for an extended period of time following the filing date of this report. Furthermore, the stock prices of many companies in the medical device industry have have experienced wide fluctuations that have often been unrelated to the operating performance of these companies. Volatility in the price price of our common stock on the NYSE American Market may depress the trading price of our common stock, which could, among other things, allow allow a potential acquirer of the Company to purchase a significant amount of our common stock at low prices. In addition, the volatility of of our stock price could lead to class action securities litigation being filed against us, which could result in substantial costs and a diversion of our management resources, which could significantly harm our business.

As described in Note 11 of the accompanying notes to the consolidated financial statements in Part II, Item 8 of this Form 10-K, on February 23, 2021, the Company`s Board of Directors, upon recommendation of the Compensation Committee, approved the grant of the Performance Share Unit Award (“CEO Performance Award”) pursuant to the CEO Performance Share Unit Award Agreement (the “PSU Agreement”), to David L. Fischel, the Company’s Chief Executive Officer. Under the terms of the PSU Agreement, the Company will incur significant additional stock-based compensation expense over the term of the award regardless of whether or not any of the milestones are achieved as the probability of meeting the ten market capitalization milestones is not considered in determining the timing of expense recognition. The expense will be recognized on an accelerated basis through 2030. Total stock-based compensation recorded as operating expense for the CEO Performance Award was $7.1 million and $7.2 million for the yearyears ended December 31, 2024.2025 and 2024, respectively. As of December 31, 2024,2025, the Company had approximately $29.8 $22.7 million of total unrecognized stock-based compensation expense remaining under the CEO Performance Award if Mr. Fischel continues to serve as CEO, or in a similar capacity, through 2030. This additional stock-based compensation expense, incurred regardless of whether any milestones are achieved, increases the difficulty for the Company to achieve a profitable position as measured by generally accepted accounting principles.

This report includes various forward-looking statements that are subject to risks and uncertainties, many of which are beyond our control. Our actual results could differ materially from those anticipated in these forward- looking statements as a result of various factors, including those set forth in Item 1A. “Risk Factors,” as well as various impacts related to our previously announced acquisition of Access Point Technologies EP, Inc. (“APT”). Forward-looking statements discuss matters that are not historical facts. Forward-looking statements include, but are not limited to, discussions regarding our operating strategy, sales and marketing strategy, regulatory strategy, industry, economic conditions, financial condition, liquidity, capital resources, results of operations, the impact of, and our response to the coronavirus (“COVID-19”) pandemicpandemic, pandemics similar to the coronavirus (“COVID-19”) pandemic (or COVID-19 resurgences),pandemic, and statements relating to our recent acquisition of APT including any benefits expected from the acquisition, potential strategic implications as a result of the acquisition, and the potential for achievement of the regulatory and commercial milestones that would trigger contingent payments in the transaction. Such statements include, but are not limited to, statements preceded by, followed by or that otherwise include the words “believes,” “expects,” “anticipates,” “intends,” “estimates,” “projects,” “can,” “could,” “may,” “will,” “would,” or similar expressions. For those statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. You should not unduly rely on these forward-looking statements, which speak only as of the date on which they were made. They give our expectations regarding the future but are not guarantees. We undertake no obligation to update publicly or revise forward-looking statements, whether because of new information, future events or otherwise, unless required by law.

Our primary products include the Genesis RMN System,and the GenesisX RMN System,Systems, the Odyssey Solution,and Synchrony & SynX Solutions, various interventional devices under the Map-iT, MAGiC and EMAGIN brands, and other related devices. Through our strategic relationships with fluoroscopy system manufacturers, providers of catheters and electrophysiology mapping systems, and other parties, we offer our customers x-ray systems and other accessory diagnostic and therapeutic devices.

The Genesis RMN Systemand isthe GenesisX RMN Systems are designed to enable physicians to complete more complex interventional procedures by providing image-guided delivery of catheters through the blood vessels and chambers of the heart to treatment sites. This is achieved using externally applied magnetic fields that govern the motion of the working tip of the catheter, resulting in improved navigation, efficient procedures, and reduced x-ray exposure. The GenesisX RMN System, the latest generation of the Genesis RMN System, is designed to significantly enhance the accessibility of Robotic Magnetic Navigation by eliminatingreducing the lengthy construction cycle necessary to install prior generation RMN systems.

We pursue arrangements with fluoroscopy system manufacturers to provide suchRMN systemsSystems in a bundled purchase offer for hospitals establishing robotic interventional operating rooms. An integrated x-ray system is critical for customer adoption of RMN systems,Systems, and when offered offered as a bundled purchase offer with the RMN System, may reduce the cost of acquisition, the ongoing cost of ownership, and the complexity of installation of a robotic electrophysiology practice.

Not all products have and/or require regulatory clearance in all the markets we serve. Please refer to “Regulatory Approval” in Item 1 for a description of the regulatory clearance, licensing, and/or approvals we currently have or are pursuing. Approval processes can be lengthy and uncertain, submissions may require revised or additional non-clinical and clinical data, and regulatory applications could be denied.

As of December 31, 2024,2025, we had approximately $15.2$9.1 million of system backlog, consisting of outstanding purchase orders and other commitments for these systems. Of the December 31, 20242025 system backlog, we expect approximately 70%78% to be recognized as revenue over the course of 2026. 2025. We had system backlog of approximately $14.7$14.4 million as of December 31, 2023.2024. There can be no assurance that we will recognize such revenue in any period or at all because some of our purchase orders and other commitments are subject to contingencies that are outside our control. These orders and commitments may be revised, modified or canceled, either by their express terms, because of negotiations or by project changes or delays. In addition, the sales cycle for the robotic magnetic navigation system is lengthy and generally involves construction construction or renovation activities at customer sites. Consequently, revenues and/or orders resulting from sales of our robotic magnetic navigation navigation systemsystems can vary significantly from one reporting period to the next.

We have strategic relationships with technology leaders and innovators in the global interventional market. Through these strategic relationships we provide compatibility with our robotic magnetic navigation system,systems, integrated x-ray systems, digital imaging and 3D catheter location sensing technology, and compatible disposable interventional devices. The maintenance of these strategic relationships, or the establishment of equivalent alternatives, is critical to our commercialization efforts. There are no guarantees that any existing strategic relationships will continue, and efforts are ongoing to ensure the availability of compatible systems and devices and/or equivalent alternatives. We cannot provide assurance as to the timeline of the ongoing availability of such compatible systems or our ability to obtain equivalent alternatives on competitive terms or at all.

BeyondIn interventional devices, we continue to drive our broad-based innovation plan with ongoing regulatory and development efforts for our RMN systems. In the third quarter of 2024, we attained CE Mark for the GenesisX RMN SystemSystem, and arein workingthe towardsfourth quarter of 2025 we received FDA 510(k) regulatory clearance within the United States. This latest generation of the RMN System is designed to significantly enhance the accessibility accessibility of Robotic Magnetic Navigation by eliminating the lengthy construction cycle necessary to install prior generation RMN systems. In November 2024, the Genesis RMN system, our current generation system, received regulatory approval from China’s National Medical Products Administration (NMPA), and our partner MicroPort received the regulatory clearances and for their integrated mapping system system and novel ablation catheter making available the most current advancesadvanced minimally-invasiveminimally invasive robotic technology to physicians and patients patients in China. In October, 2025, we attained CE Mark for the Synchrony Solution and are working towards FDA 510(k) regulatory clearance within the United States.

In addition to the aforementioned macroeconomic factors, occurrences similar to the COVID-19 pandemic or similar occurrences may negatively affect demand for both our systems and our disposable products. In the past, we have experienced business disruptions, including travel restrictions on us and our third-party distributors, which negatively affected our complex sales, marketing, installation, distribution and service network relating to our products and services. We also experienced reductions in demand for our disposable products as our healthcare customers (physicians and hospitals) re-prioritized the treatment of patients and diverted resources away from non-pandemic areas, leading to the performance of fewer procedures in which our disposable products are used. The impact varied widely over time by individual geography. For instance, in 2022, procedure volumes were challenged by periodic resurgences of COVID-19, ongoing hospital staffing issues and other factors. In the first quarter of 2023, COVID-19 resurgences in China continued to negatively impact our procedure volumes in that region, but as infections and hospitalization decreased, we saw a recovery of procedure volumes with no further impacts in the current year. Significant decreases to our capital or recurring revenues could have a material adverse effect on our business, operating results, and financial condition. We continue to anticipate periodic disruptions to our manufacturing operations, supply chains, procedures volumes, service activities, and capital system orders and placements relating to new or ongoing periodic resurgences of pandemic-related issues, any of which could have a material adverse effect on our business, financial condition, results of operations, or cash flows.

Financial instruments that potentially subject the Company to concentration of credit risk consist of cash, cash equivalents and marketable securities. Our investments may include, at any time, a diversified portfolio of cash equivalents and short-term and long-term investments in a variety of high-quality securities, including money market funds, U.S. treasury and U.S. government agency securities, corporate notes and bonds, commercial paper, non-U.S. government agency securities, and municipal notes. The Company’s exposure to any individual corporate entity is limited by policy. Deposits may exceed federally insured limits, and the Company is exposed to credit risk on deposits in the event of default by the financial institutions to the extent account balances exceed the amount insured by the Federal Deposit Insurance Corporation (FDIC). The Company closely monitors events involving limited liquidity, defaults, non-performance or other adverse developments that affect financial institutions or other companies in the financial services industry or the financial services industry generally, including Silicon Valley Bank. On March 10, 2023, Silicon Valley Bank (“SVB”), where the Company maintained accounts with a cash balance of less than 6% of the Company’s total cash, cash equivalents and marketable securities, was closed by the California Department of Financial Protection and Innovation and the FDIC was appointed as receiver. On March 12, 2023, the U.S. Department of the Treasury, Federal Reserve Board, and FDIC released a joint statement announcing that the FDIC would complete its resolution of SVB in a manner that fully protected all depositors at SVB and that depositors would have access to all of their money starting March 13, 2023. On March 26, 2023, it was announced that First-Citizens Bank & Trust Company would assume all of SVB’s deposits and loans as of March 27, 2023. During the periods presented, the Company has not experienced any losses on its deposits of cash, cash equivalents or marketable securities.generally.

InWe accordance with Accounting Standards Codification Topic 606 (“ASC 606”), “Revenue from Contracts with Customers,” we account for a contract with a customer when there is a legally enforceable contract between the Company and the customer, the rights of the parties are identified, the contract has commercial substance, and collectability of the contract consideration is probable. We record our revenue based on consideration specified in the contract with each customer, net of any taxes collected from customers that are remitted to government authorities.

The Company has determined that the contingent consideration due under the terms of its July 31, 2024, acquisition agreement with APT Holding Company, Inc. represents a contingent liability in accordance with the provisions of Accounting Standard 805, Business Combinations. The Company has established short-term and long-term contingent liabilities for the net present fair value of contingent payments which are both probable of occurrence and reasonably estimable. The initial fair value of the contingent consideration both at the acquisition date and subsequent reporting periods was determined by a third-party valuation firm using both a Monte Carlo simulation and probability based approaches. The contingent consideration is remeasured to fair value at each reporting date until the contingency is resolved. Changes in fair value are recognized in the Company’s earnings as a charge to General and Administrative expenses. See Note 3, Acquisitions for further discussion of the contingent consideration recorded as of the acquisition date and as of December 31, 2025 and 2024.

Stock compensation expense, which is a non-cash charge, results from stock, stock option, non-qualified stock options, stock appreciation rights, and restricted share grants made to employees, directors, and third-party consultants at the fair value of the grants. For time-based awards, the fair value of options and stock appreciation rights granted was determined using the Black-Scholes valuation method which gives consideration to the estimated value of the underlying stock at the date of grant, the exercise price of the option, the expected dividend yield and volatility of the underlying stock, the expected life of the option and the corresponding risk-free interest rate. The fair value of the grants of stock and restricted shares and units was determined based on the closing price of our stock on the date of grant. Stock compensation expense for options, stock appreciation rights and for time-based restricted share grants and units is amortized on on a straight-line basis over the vesting period of the underlying issue, generally over four years except for grants to directors which are generally earned over a period of six months. Stock compensation expense for performance-based restricted shares, if any, is amortized on a straight-line basis over the anticipated vesting period and is subject to adjustment based on the actual achievement of objectives. Compensation expense is recognized only for those optionsawards expected to vest, net of actual forfeitures. Estimates of the expected life of options have been based on the average of the vesting and expiration periods, which is the simplified method under general accounting principles for share-based payments. Estimates of volatility utilized in calculating stock-based compensation have been prepared based on historical data. Actual experience to date has been consistent with these estimates.

The amount of compensation expense to be recorded in future periods may increase if we make additional grants of options, stock appreciation rights or restricted shares. The amount of expense to be recorded in future periods may decrease if the requisite service periods are not completed.completed or if performance targets are not achieved.

Revenue. Revenue increased from $26.8 million for the year ended December 31, 2023, to $26.9 million for the year ended December 31, 2024, an increaseto of less than 1%. Revenue from sales of systems decreased from $8.7$32.4 million for the year ended December 31, 2023,2025, an increase of 20%. Revenue from sales of systems increased from $8.6 million for the year ended December 31, 2024, to $8.6$10.2 million for the year ended December 31, 2024,2025, aan decreaseincrease of approximately 1%,18%, driven by decreasedincreased system sales volumes in the current year period. period. Revenue from sales of disposable interventional devices, service and accessories increased to $18.3$22.2 million for the year ended December 31, 2024,2025, from $18.0$18.3 million for the year ended December 31, 2023,2024, an increase of approximately 1%.21%. The increase was primarily driven by the contributionsfull year contribution from our recent2024 acquisition of APT partiallyand offset by decreasedincreased service revenue in the current year period.

Cost of Revenue. Cost of revenue increased from $11.9$12.3 million for the year ended December 31, 2023,2024, to $12.3$15.3 million for the year ended December 31, 2024,2025, an increase of approximately 3%.24%. As a percentage of our total revenue, overall gross margin was 54%53% and 56%54% for the years ended December 31, 2024,2025, and December 31, 2023,2024, respectively. The decrease was primarily due to changes in product mix. Cost of revenue for systems sold decreasedincreased from $8.1$6.9 million for the year ended December 31, 2023,2024, to $6.9$8.0 million for the year ended December 31, 2024,2025, primarily due to decreasedincreased system sales volume and changes in product mix in the current year period. Gross margin for systems increased from $0.7$1.8 million for the year ended December 31, 2024, to $2.2 million for the year ended December 31, 2023,2025. toCost $1.8of revenue for disposables, service, and accessories increased from $5.4 million for the year ended December 31, 2024.2024, Costto of revenue for disposables, service, and accessories increased from $3.9$7.3 million for the year ended December 31, 2023, to $5.4 million for the year2025. ended December 31, 2024. Gross margin for disposables, service and accessories was 70%67% for the current year period compared to 79%70% for the year ended December 31, 2023,2024, primarily driven by acquisitionproduct related accounting which required the valuation of acquired finished good inventory to fair value.mix.

Research and Development Expense. Research and development expenses decreased from $10.3 million for the year ended December 31, 2023, to $9.8 million for the year ended December 31, 2024, to $9.4 million for the year ended December 31, 2025, a decrease of approximately 5%.4%. This decrease was primarily driven by the reversal attainment of antechnological accruedfeasibility and regulatory licenseapproval fee.of the GenesisX in 2025 offset by acquired headcount expense from our acquisition.

General and Administrative Expense. General and administrative expenses include finance, information systems, legal, and general management expenses, amortization of acquisition related intangible assets, and the gain or loss associated with the remeasurement of the acquisition related contingent consideration. General and administrative expenses increased from $14.1 million for the year ended December 31, 2023, to $17.2 million for the year ended December 31, 2024, to $17.8 million for the year ended December 31, 2025, an increase of approximately 22%.4%. This increase was primarily driven by the remeasurementchange of thein contingent consideration,consideration higherexpense and amortization of acquisition related intangible assets offset by lower administrative expenses and professional service fees in the current year period, and amortization of the acquisition related intangible assets.period.

RealizationAs of deferred tax assets is dependent upon future earnings, the timing and amount of which are uncertain. Accordingly, net deferred tax assets have been fully offset by valuation allowances as of December 31, 2024, and December 31, 2023, to reflect these uncertainties. As of December 31, 2024,2025, we had gross federal net operating loss carryforwards arising from our operations of approximately $134.9$159.1 million. The federal net operating loss carryforwards reflect accumulated book losses reduced for the 2013 IRC Section 382 ownership change limitation of $188.0$144.4 million, book/tax differences and expiration of carryforwards. The federal net operating loss carryforwards generated prior to the 2018 tax year of approximately $98.8 million will expire between 2030 and 2037. The federal net operating losses generated in 2018 and thereafter will be carried forward indefinitely as a result of changes in the tax law following the Tax Cuts and Jobs Act (“TCJA”). As of December 31, 2024,2025, we had gross state net operating loss carryforward of approximately $38.1$50.2 million which will expire at various dates between 20252026 and 2043 if not utilized.

In addition to the net operating loss carryovers related to our operations, in connection with our 2024 acquisition of APT as discussed in in Note 3, we acquired federal and state net operating loss and tax credit carryovers of APT. Our ability to utilize those carryovers and credits will be limited under IRC Section 382. The Section 382 limited net operating loss carryovers total approximately $9.1$9.2 million, million, of which $0.6 million was incurred prior to the 2018 effective date of the TCJA and will expire between 2035 and 2037 with the remainder available for indefinite carryforward. The applicable state net operating loss carryforwards related to APT are approximately $9.6 million with $9.1$9.2 million expiring at various dates between 2030-20382030 - 2038 with the remaining carried forward indefinitely. The acquired tax credit carryovers carryforwards total $0.2$0.3 million for federal income tax purposes, which expire between 2036 and 2043, and state credit carryovers of $0.3 million, which expire between 2031 and 2038. Consistent with our conclusion with respect to the need for valuation allowances associated with our other deferred tax assets, the net deferred tax assets related to APT of $1.6 million at the acquisition date as well as those at December 31, 20242025 were fully included in our valuation allowance.

As of December 31, 2024,2025, our accumulated deficit was $561.7$583.4 million with cash and cash equivalents of $12.4$13.4 million, inclusive of restricted cash.million. Since inception, we have financed our operations primarily through cash generated by operations and proceeds from our debt and stock offerings.

Net cash used in operating activities. We used approximately $8.5$13.7 million and $9.1$8.5 million of cash in operating activities during the years ended December 31, 20242025 and 2023,2024, respectively. The decreaseincrease in cash used in operating activities was primarily driven by the increased operating loss partially offset by changes in working capital.

Net cash provided by financing activities. We generated approximately $0.3$14.8 million and $0.1$0.3 million of cash from financing activities for the years ended December 31, 20242025 and 2023,2024, respectively. The cash generated in both periods2025 was primarily driven by the exerciseproceeds from the registered direct offering and the controlled equity offering during the third and fourth quarters. The cash generated in 2024 was driven by the proceeds from issuance of stock from the exercise of options, net of issuance costs, and from our employee stock purchase program.

At December 31, 2024,2025, we had working capital of approximately $4.8 million, compared to a working capital of approximately $20.0$11.5 million, compared to working capital of approximately $4.8 million at December 31, 2023.2024. The decrease increase in working capital was primarily driven by the netproceeds lossfrom incurredour andequity acquisitionofferings ofin APT during the year ended December 31, 2024.2025.

This report includes various forward-looking statements that are subject to risks and uncertainties, many of which are beyond our control. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth in “Part II -II, Item 1A.1A, “Risk FactorsFactors,” included inof this Quarterly Report on Form 10-Q and in Part I, Item 1A, “Risk Factors,” included inof our Annual Report on Form 10-K for the year ended December 31,2025,31, 2025, as amended, as well as variousrisks impactsand uncertainties related to our previously announced acquisition of Access Point Technologies EP, Inc. (“APT”) and our recently announcedcompleted acquisition acquisitions of Robocath. Forward-looking statements discuss matters that are not historical facts. Forward-looking statements include, but are not limited to, discussions regarding our operating strategy, sales and marketing strategy, regulatory strategy, industry, economic conditions, conditions, financial condition, liquidity, capital resources,resources and results of operations,operations; the on-goingongoing impact of the coronavirus (“COVID -19COVID-19”) pandemic and our response to it or anythe impact of aany similar pandemic,pandemic; and statements relating to our recent acquisitionacquisitions of APT and Robocath, including anythe anticipated benefits expected from the acquisition, potentialand strategic implications as a result of the acquisition,acquisitions; our ability to integrate acquired operations; manufacture, develop, commercialize and thesell potential foracquired achievementproducts; ofretain thekey personnel; fund Robocath’s operations; and achieve regulatory and commercial milestones that wouldcould trigger contingent payments in the transaction.payments. Such statements include, but are not limited to, statements preceded by, followed by, or that otherwise include the words “believebelieve,”, “expectsexpects,”, “anticipates,” “intends,” “anticipatesestimates,”, “intendsprojects,”, “estimatescan,”, “projectscould,”, “canmay,”, “could”, “may”, “would”, or similar expressions. For those statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. You should not unduly rely on these forward-looking statements, which speak only as of the date on which they are made. They give our expectations regarding the future but are not guarantees. We undertake no obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless required by law.

We pursue arrangements with fluoroscopy system manufacturers to provide RMN Systems in a bundled purchase offer for hospitals establishing robotic interventional operating rooms. An integrated x-ray system is critical for customer adoption of RMN Systems,Systems andand, when offered asin a bundled purchase offer with the RMN System, may reduce the cost of acquisition, the ongoing cost of ownership, and the the complexity of installation of a robotic electrophysiology practice.

In the fourth quarter of 20252025, we received FDA 510(k) regulatory clearance withinin the United States for the GenesisX RMN System. This latest generation of the RMN System is designed to significantly enhance the accessibility of Robotic Magnetic Navigation by eliminating the lengthy construction cycle necessary to install prior generationprior-generation RMN systems. In October 2025, we attainedobtained CE Mark for the Synchrony Solution Solution, and in theApril first quarter of 20262026, we received FDA 510(k) regulatory clearance withinin the United States.

The Stereotaxis MAGiC catheter, a robotically navigated magnetic ablation catheter designed to perform minimally invasive cardiac ablation procedures, obtained the CE marking in Europe during the first quarter,quarter of 2025 and U.S. Food and Drug Administration (FDA) 510(k) clearance in January 2026. MAGiC Sweep™, the first robotically navigated high-density EP mapping catheter, received U.S. Food and Drug Administration (FDA) 510(k) clearance in July 2025. We are in the process of obtaining necessary approvals for both devices in other geographies. We are also currently seeking regulatory clearances for the EMAGIN 5F catheter guideguide, which is designed to robotically navigate tortuous venous and arterial vasculature.

Beginning in 2025, the U.S. implemented a baseline tariff framework on most importsimports, with higher countrycountry- and product-specific rates for certain trading partners, including Mexico, Germany, Japan and China, among others, alongside reciprocal measures announced by other jurisdictions. In February 2026, the U.S. Supreme Court ruled that these tariffs levied under the International Emergency Economic Powers Act (“IEEPA”) arewere unconstitutional. As a result of this ruling, the U.S. Court of International Trade issued an order directing the U.S. Customs and Border Border Protection (the “CBP”) agency to begin formalizing a processrefund for refunds.process. On April 20, 2026, the CBP launched an online portal that can be used to submitfor IEEPA tariff refund requests, which are subject to review by CBP. Such refund requests.process Allwas requestsappealed willand beis reviewed by the CBPsubject to determineongoing validitylitigation, prioras well as torefund theprocess issuance of refunds.developments. In response to the Supreme Court’s ruling, a new 10% tariffsurcharge foron allmost imports was imposed under Section 122 of the Trade Act of 19741974. wasThe imposed. These tariffssurcharge took effect on February 24, 2026, and willexpired remainon inJuly effect24, for2026. 150 days, the maximum period thatThese Section 122 permitstariffs are withoutcurrently congressionalsubject action.to However,legal previouschallenge and in May 2026, the CIT issued a ruling that the Section 122 tariffs are unauthorized by the statute, although this ruling is currently stayed pending appeal. Previous exclusions, such asincluding for qualifying goods under the United States-Mexico-Canada Agreement (“USMCA”), remainremained in place. In July 2026, the U.S. presidential administration imposed additional tariffs under Section 301 of the Trade Act of 1974. These Section 301 tariffs are also currently subject to legal challenge.

We source certain sub-assembliessubassemblies from Mexico, all of which qualify under USMCA; therefore, these items were not subject to the increased tariff, tariff, and the effect on our cost of revenuesrevenue for the threesix months ended MarchJune 31,30, 2026, was immaterial. We currently expect our Mexican subassemblies sub-assemblies to continue to qualify under USMCA,USMCA and wetherefore do therefore not expect a material impact from future changes inrelating theto future.these items.

Some of our suppliers have also incurred incremental tariffs and have passed or may pass on those additional costs on to us. These pass-through tariffs and other specific tariff actions against steel and aluminum have resulted in an effective rate of up to 60 percent60% (“tariff stacking”) on certain specialty alloys that we source from Europe and Japan. ThisThese actionmeasures hashave not had a material direct impact on our operations to date, but the long-term effects of these and other existing or future trade measures are difficult to predict.

We also import certain raw materials and finished goods from outside of the U.S. that are subject to tariffs, including our proprietary MAGiC Cathetercatheter, which is manufactured in Germany and currently distributed principally in Europe. This device received FDA 510(k) clearance clearance in the USU.S. in January 2026, and we are currently ramping up production of this device as a replacement for catheters previously supplied by to users by J&J. Tariffs could render the USU.S. product launch of the MAGiC Cathetercatheter uneconomical, which would, in turn,could slow adoption adoption of our Robotic Magnetic Navigation (“RMN”) platform.

During the threesix months ended MarchJune 31,30, 2026, tariffs and other trade measures recognized in total cost of revenue were not material. Future changes to tariff ratesrates, the availability of tariff refunds and the imposition of new tariffs by the U.S. and/or other countries could result in a material impact to our results of operations. TheThere remains substantial uncertainty regarding the duration of various existing and newly announced or intended tariffs, potential changes or pauses to such tariffs, tariff levels, and whether further additional tariffs or other retaliatory actions may be imposed, modified, suspended, or invalidated, and the ultimate impact of changes to tariffs and trade barriers will depend on various factors, including the timing, amount, scope, and nature of any tariffs or trade barriers that are implemented,implemented and the availability of refunds, all of which could have a material adverse effect on our business, financial condition, or results of operations. We continue to monitor and evaluate these developments and assess their potential impact on our business, financial condition, and results of operations.

Future results of operations and liquidity could be materially adversely impacted by uncertainties in macroeconomic and geopolitical factors in both the U.S. and globally including continuing introduction of new or modification of existing tariffs or trade barriers, supply chain challenges, inflationary pressures, elevated interest rates, and disruptions in commodity markets stemming from conflicts, such as those between Russia and Ukraine and conflicts in the Middle East, including Israel and Iran. The Company continues to experience difficulties with periodic worldwide supply chain disruptions, including shortages and inflationary pressures, tariffs and other trade regulations that are or may be imposed, and logistics delays which make it difficult for us to source parts and ship our products. We continue to evaluate the macroeconomicsmacroeconomic business environment, taking action to increase inventory levels where appropriate and engaging in discussions with our vendors on contractual obligations, but we cannot guarantee that our business activities will not be impacted more severely in the future. Our suppliers and contract manufacturers have experienced, and may continue to experience, similar difficulties. If our manufacturing operations or supply chains are materially interrupted, it may not be possible for us to timely manufacture or service our products at required levels, or at all. Changes in economic conditions, government shutdowns, tariff escalation, retaliatory measures and new import restrictions could lead to higher inflation than previously experienced or expected, which could, in turn create supply shortages as companies seek alternative sources of supply and adjust their logistics and transportation routes. As a result of these factors, we may be unable to raise the prices of our products sufficiently to keep up with the rate of inflation, especially tariff-induced inflation. A material reduction or interruption in any of our manufacturing processes or a substantial increase in costs would have a material adverse effect on our business, operating results, and financial condition.

In addition to the macroeconomic factors, occurrences similar to the COVID-19 pandemic may negatively affect demand for both our systems and our disposable products. In the past, we have experienced business disruptions, including travel restrictions on us and our third-party distributors, which negatively affected our complex sales, marketing, installation, distribution and service network relating to our products and services. We also experienced reductions in demand for our disposable products as our healthcare customers (physicians and hospitals) re-prioritized the treatment of patients and diverted resources away from non-pandemic areas, leading to the performance of fewer procedures in which our disposable products are used. The impact varied widely over time by individual geography. For instance, in 2022, procedure volumes were challenged by periodic resurgences of COVID-19, ongoing hospital staffing issues and other factors. In the first quarter of 2023, COVID-19 resurgences in China continued to negatively impact our procedure volumes in that region, but as infections and hospitalization decreased, we saw a recovery of procedure volumes with no further impacts in the year. Significant decreases to our capital or recurring revenues could have a material adverse effect on our business, operating results, and financial condition. We continue to anticipate periodic disruptions to our manufacturing operations, supply chains, procedures volumes, service activities, and capital system orders and placements relating to new or ongoing periodic resurgences of pandemic-related issues, any of which could have a material adverse effect on our business, financial condition, results of operations, or cash flows.

As a result of the July 2024our acquisition of APT EP, Inc.,Inc. July 2024 and of Robocath in July 2026, we are managing APT’sthe ongoing businessbusinesses of both APT and Robocath, which include the manufacturing, commercializing, development developing and salesselling ofcatheters, APT’sinterventional cathetersproducts and other related products and services. The manufacturing process offor catheters is complex, complex and highly technical, and our prior experience in this field is prior to the APT acquisition was dated. The process can be subject to periodic worldwide supply chain disruptions, including labor shortages and inflationary pressures, tariffs or other trade restrictions, and logistics delays whichthat make it difficult for us to source parts and ship our products. We may require a higher level of overhead than currently anticipated. Our ability to successfully manage this new aspect of our business will depend, in part, upon management’s ability to design and implement strategic initiatives that address not only the integration of APT and Robocath into us,our business, but also the increased scope of the combined business withand its associated increased costs and complexity. We are still integrating theboth APT’s and Robocath’s respective businesses into our own, and implementing safeguards to minimize any negative impacts on our financial position, results of operations and cash flowsflows. post-acquisition.In addition, Robocath is located in, and organized under the law of, France, and that may present additional accounting, cultural, regulatory and other issues. Please refer to Part II, Item 1A, Risk Factors, for a description of the risks associated with the Robocath acquisition.

Since our inception, we have generated significant losses. As of MarchJune 31,30, 2026, we have incurred cumulative net losses of approximately $589.2$593.7 million. In 2026, the Company plans to advance adoption of its robotic magnetic navigation systems and its proprietary devices in those markets where regulatory clearance has been received and to work with regulatory approval authorities in those geographies where approval is pending, with the goal of furthering clinical adoption and new system placements. We expect to incur additional losses in 2026 as we continue the development and commercialization of our products, conduct our research and development activities, advance new products into clinical development from our existing research programs andprograms, fund additional sales and marketing initiatives.initiatives, and fund Robocath’s ongoing operations and development of its next-generation R-Two products. Robocath has sustained historical operating losses, and we expect that it will continue to incur operating losses and negative cash flows in the coming years. We may be required to fund Robocath’s ongoing operations for the foreseeable future. During the remainder of 2026, we will continue to monitor the impact of the macroeconomic environment on our project timing, regulatory approvals, customer and supplier operations, and our operating results. Until we can generate significant cash flow from our operations, we expect to continue to fund our operations with cash resources primarily generated from the proceeds of our past and future public offerings,offerings and private sales of our equity securities. We cannot accurately predict the timing and amount of our utilization of capital, which will depend on several factors outside of our control.

WhileBased on our current plans and assumptions, we believe our existing cash and cash equivalents, including the proceeds from our at-the-market offering program and July 2025 equity raise, will be sufficient to fund our operating expenses and capital equipment requirements, inincluding currently anticipated funding requirements for Robocath’s operations and development activities. In light of the macroeconomic environment environment,and the uncertainties associated with integrating and funding Robocath, however, we cannot guarantee that we will not need additional funding in the future. We will continue to explore financing alternatives, and we cannot guarantee that additional financing financing will be available on acceptable terms or that such financing will not be dilutive to our stockholders. If adequate funds are not available to us, we could be required to delay development or commercialization of new products, to license to third parties the rights to commercialize products or technologies that we would otherwise seek to commercialize ourselves, or to reduce the sales, marketing, customer support or other resources devoted to our products, any of which could have a material adverse effect on our business, financial condition, condition and operationalresults of results.operations. In addition, we could be required to cease operations.

Contracts related to the sale of systems typically contain separate obligations for the delivery of system(s), installation, and a service-type service-type warranty for one year following installation. Revenue is recognized when the Company transfers control to the customer, which is generally at the point when acceptance occurs that indicates customer acknowledgment of delivery or installation, depending on the terms of the arrangement. arrangement. Revenue from service-type warranties is included in Other Recurring Revenue and is recognized ratably typically over the first year following installation of the system as the customer receives the service-type warranty throughout the period. The Company’s system system contracts generally do not provide a right of return. Systems may be covered by a one-year assurance-type warranty in lieu of a a service-type warranty. Assurance-type warranty costs were less than $0.1 million for the threesix months ended MarchJune 31,30, 2026, and 2025.

Revenue from sales of disposable products is recognized when control is transferred to the customers, which generally occurs at the time of shipment, but can also occur at the time of delivery depending on the customer arrangement. Disposable products are covered by an assurance type warranty that provides for the return of defective products. Warranty costs were not material for the threesix months ended MarchJune 31,30, 2026, and 2025.

The Company has determined that sales incentive programs for the Company’s sales team meet the requirements to be capitalized as the Company expects to generate future economic benefits from the related revenue generating contracts after the initial capital sales transaction. The costs capitalized as contract acquisition costs included in prepaid expenses and other assets in the Company’s consolidated balance sheets were approximately $0.2 million and $0.1 million as of MarchJune 31,30, 2026, and December 31, 2025, respectively. The Company did not incur any impairment losses during any of the periods presented.

Comparison of the Three Months Ended MarchJune 31,30, 2026, and 2025

Revenue. Revenue decreased from $7.5$8.8 million for the three months ended MarchJune 31,30, 2025, to $6.3$7.7 million for the three months ended MarchJune 31,30, 2026, a decrease of 16%.13%. Revenue from the sales of systems decreased to $1.3$1.5 million for the three months ended MarchJune 31,30, 2026, from $2.0$3.0 million for the three months ended MarchJune 31,30, 2025, driven by decreased sales volume in the current year period. Revenue from sales of disposable interventional devices, service, and accessories decreasedincreased to approximately $5.0$6.2 million for the three months ended MarchJune 31,30, 2026, from $5.5$5.8 million for the three months ended MarchJune 31,30, 2025, aan decreaseincrease of approximately 10%.7%. The decreaseincrease in the current period was lowerprimarily driven by higher current period disposable sales volumesof relatedStereotaxis tosupplied thecatheters transitionwhich include our proprietary MAGiC ablation catheter partially offset by continuing pressure from the Johnson and& Johnson catheter to our proprietary MAGiC catheter in the current year period.transition.

Cost of Revenue. Cost of revenue decreased from $3.4$4.2 million for the three months ended MarchJune 31,30, 2025, to $2.5$3.2 million for the three months months ended MarchJune 31,30, 2026, a decrease of approximately 27%.25%. As a percentage of our total revenue, overall gross margin increased to 58% for 60%the three months ended June 30, 2026, from 52% for the three months ended MarchJune 31, 2026, from 54% for the three months ended March 31,30, 2025, primarily due to changes in product mix. Cost of revenue for systems sold decreased from $1.7$2.4 million for the three months ended MarchJune 31,30, 2025, to $0.8$1.1 million for the three months ended MarchJune 31,30, 2026, driven by decreased system sales volume in the current year period. Gross margin for systems was $0.3 $0.7 million for the three months ended MarchJune 31,30, 2025, compared to $0.5$0.4 million for the three months ended MarchJune 31,30, 2026. Cost of revenue for disposables, service, and accessories remainedincreased consistentfrom at $1.7$1.9 million for the three months ended MarchJune 31,30, 20252025, andto 2026.$2.1 Gross margin for disposables, service, and accessories was 66%million for the three months ended June March 31,30, 2026, compareddriven toby 68%increased fordisposable thesales three months ended March 31, 2025.volumes. Gross margin for disposables, service, and accessories decreased to 66% for the three months ended June 30, 2026, from 68% for the three months ended June 30, 2025 due to changes in product mix in the current period.

Research and Development Expenses. Research and development expenses increased from $2.3$1.8 million for the three months ended MarchJune 31,30, 2025, to $2.4 million for the three months ended MarchJune 31,30, 2026, an increase of approximately 2%.34%. This increase was primarily duedriven toby projectthe timingcapitalization of GenesisX into inventory in the prior year period and partially offset by lower headcount-related costs.costs in the current year period.

Sales and Marketing Expenses. Sales and marketing expenses decreased from $3.1$3.3 million for the three months ended MarchJune 31,30, 2025, to $2.6 million for the three months ended MarchJune 31,30, 2026.2026, a decrease of approximately 21%. This decrease was primarily due to lower headcount-related costs costsand trade-show expenses in the current year period.

General and Administrative Expenses. General and administrative expenses include finance, information systems, legal, and general management expenses, amortization of acquisition related intangible assets, and the gain or loss associated with the remeasurement of the acquisition related contingent consideration. General and administrative expenses increased from $4.5$4.0 million for the three months ended MarchJune 31,30, 2025, to $4.8$4.1 million for the three months ended MarchJune 31,30, 2026, an increase of approximately 6%. This increase was primarily driven by the change in contingent consideration expense and costs related to the pending Robocath acquisition, partially offset by lower headcount-related costs in the current year period.2%.

Interest Income. Net interest income remained consistent at $0.1 million for the three months ended MarchJune 31,30, 2025, and 2026.

As of MarchJune 31,30, 2026, we had $14.6$10.5 million of cash and cash equivalents. We had working capital of $12.9$11.2 million as of MarchJune 31,30, 2026, compared to $11.5 million as of December 31, 2025.

In July 2025, we closed a registered direct offering of our common stock for $8.5 million in gross proceeds before deducting offering expenses. In November 2025, we completed the Additionaladditional Closingclosing from the July registered direct registering offering for $4.0 million in gross proceeds before deducting offering expenses.

On March 13, 2026, we filed a new shelf registration statement on Form S-3 (File No. 333-294288) to register (i) $100.0 million of debt securities, common stock, preferred stock, warrants, rights or units consisting of any two or more of such securities (the “2026 Shelf”) and (ii) $50$50.0 million shares of common stock tothat may be issued under the at-the-market offering program with Roth Capital described below. The 2026 Shelf was declared effective by the SEC on March 20, 2026.

As noted above, in August 2025, we entered into a sales agreement with Roth Capital Markets (“Roth”), as sales agent and/or principal, under which we may issue and sell up to $50.0 million of our common stock. On March 13, 2026, we entered into a first amendment to the sales agreement, which modified the original sales agreement to, among other things, reflect our filing of a new Registration Statement on Form S-3 with the SEC on March 13, 2026 and set the maximum amount of shares of our common stock that we may offer and sell through or to Roth at $50 million from the date of the amendment to the sales agreement, subject to certain limitations set forth in the amendment. During the threesix months ended MarchJune 31,30, 2026, we sold an aggregate of 2,005,3082,361,579 shares of common stock under the sales agreement, agreement, at an average price of approximately $2.39$2.34 per share for gross proceeds of $4.8$5.5 million and net proceeds of $4.6$5.3 million, after deducting Roth’s commission and other expenses. As of MarchJune 31,30, 2026, $50.0$49.3 million of common stock remained available to be sold under this facility, subject to certain conditions as specified in the sales agreement.

The following table summarizes our cash flow by operating, investing and financing activities for the threesix months ended MarchJune 31,30, 2026, and and 2025 (in thousands):

Net cash used in operating activities. We used approximately $3.4$7.1 million and $1.8$5.5 million of cash for operating activities during the threesix months ended MarchJune 31,30, 2026,2026 and 2025, respectively. The increase in cash used in operating activities was driven by the higher operating loss in the current-year period and changes in working capital.

Net cash used in investing activities. We used lessapproximately than $0.1$1.2 million of cash for investing activities during the threesix months ended ended MarchJune 31,30, 20262026, for interim financing provided to Robocath and the purchase of equipment. We didused notless usethan any$0.1 million of cash for investing activities during the threesix months ended MarchJune 31, 2025.30, 2025, for the purchase of equipment.

Net cash provided by financing activities. We generated approximately $4.7$5.4 million of cash from financing activities during the threesix months months ended MarchJune 31,30, 2026, and less thanapproximately $0.1 million during the threesix months ended MarchJune 31,30, 2025. The cash generated in 2026 was primarily primarily driven by the proceeds from the at-the-market offering during the first quarter.offering. The cash generated in in 2025 was driven by the proceeds from the issuance of stock from upon the exercise of options, net of issuance costs, and from our employee stock purchase program.

As of MarchJune 31,30, 2026, the Company did not have any debt.