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Spectral AI Announces 2025 First Quarter Financial Results

1. MDAI reported Q1 2025 revenue of $6.7 million, a 6% increase. 2. Achieved net income of $2.9 million, contrasting with $3.2 million loss last year. 3. DeepView™ System demonstrates superior burn healing predictions, crucial for FDA submission. 4. Secured $15 million debt financing, enhancing cash to $14.1 million. 5. Company reaffirms $21.5 million revenue guidance for FY 2025.

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Why Bullish?

MDAI's revenue increase and net income signify strong operational performance, similar to positive impacts seen from previous FDA submissions in biotech firms.

How important is it?

Positive financial results and strong FDA submission indicators raise investor confidence, potentially translating into stock price support.

Why Short Term?

Immediate market response is expected due to revenue and financing news, as seen previously in biotech advancements with FDA submissions.

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NASDAQ: BARDANASDAQ: INONASDAQ: NVAX
May 13, 2025 16:05 ET  | Source: Spectral AI, Inc. Q1 Overview Research & Development Revenue of $6.7 MillionImproved Capital Structure Reflected in Cash of $14.1 MillionContinued work on planned De Novo submission to the FDA in the first half of 2025 DALLAS, May 13, 2025 (GLOBE NEWSWIRE) -- Spectral AI, Inc. (Nasdaq: MDAI) (“Spectral AI” or the “Company”), an artificial intelligence (AI) company focused on medical diagnostics for faster and more accurate treatment decisions in wound care, today announced financial results for the first quarter ended March 31, 2025 and provided an update on its ongoing business activities. “During the first quarter we continued to execute against our strategic plan and are working hard towards our De Novo submission to the FDA by the end of the first half of 2025,” said Dr. J. Michael DiMaio, M.D., the Company’s Chairman of the Board. “We made important strides in the validation of the diagnostic results of our DeepView™ System for burn indication through the completion of our Burn Validation Study in March, 2025. The goal of the Burn Validation Study was to further demonstrate the innovative and versatile nature of Spectral AI’s DeepView technology, as well as its ability to predict burn wound healing potential on the first day of injury with greater performance and speed than the methods currently used today. With the rigorous statistical analysis support, the DeepView System continues to outperform the clinical judgment of burn physicians by a large margin.” Dr. DiMaio concluded, “I am pleased with the operating results through the first quarter of 2025 and our team remains dedicated as we continue to drive towards our FDA De Novo submission by the end of the first half of 2025; and I’m proud of the work of our team to realize this significant milestone in the Company’s history.” SELECT BUSINESS HIGHLIGHTS Clinical Trials The Burn Validation Study which concluded in March 2025, represented one of the largest burn trials ever conducted in the United States. The Company enrolled and analyzed data obtained from 164 total patients comprised of 115 adult and 49 pediatric patients in burn centers and emergency departments across the United States. Corporate The Company satisfied all of its outstanding obligations relating to its SEPA (defined below) in February 2025.The Company completed a debt financing agreement of up to $15.0 million from Avenue Capital Group, with an initial draw down of $8.5 million in March 2025. In connection with this debt financing, the Company also raised $2.7 million of equity financing from institutional and other new and existing investors. The capital raise provides significant support to Spectral AI’s product commercialization efforts, including the upcoming U.S. launch of its DeepView System. Q1 2025 FINANCIAL RESULTS OVERVIEW All comparisons are to the first quarter ended March 31, 2024 (“Q1 2024”) unless otherwise stated. Research & Development Revenue¹ Research & Development Revenue for Q1 2025 rose 6.0% to $6.7 million from $6.3 million, reflecting an increased level of activity under the Company’s contract with BARDA (the “BARDA PBS Contract”). Gross Margin Gross margin for Q1 2025 improved to 47.2% from 46.6%, due to a slightly higher concentration of direct labor as a component of reimbursement under the BARDA PBS Contract as compared to the first quarter of 2024. General & Administrative Expense General & administrative expenses in Q1 2025 were reduced to $4.1 million from $5.1 million reflecting a directed focus on work by the Company on the BARDA PBS Contract. Other Income/(Expense) Other income/(expense) in Q1 2025 increased $4.9 million from $(1.0) million primarily relating to the Company recording a decrease in the fair value of its warrant liability of $4.4 million in Q1 2025. In addition, transaction costs were $0 as compared to $(0.8) million for the first quarter of 2024, which related to the Company’s previously announced financing agreements (see “Financial Condition” section below). Net Income/(Loss) The Company reported net income for Q1 2025 of $2.9 million, compared to a net loss of $(3.2) million, primarily due to the change in the fair value of the Company’s warrant liability. Financial Condition As of March 31, 2025, cash improved to $14.1 million from $5.2 million at December 31, 2024. As noted above, the Company completed a debt financing agreement of up to $15.0 million from Avenue Capital Group, with an initial draw down of $8.5 million in March 2025 and also raised approximately $2.7 million of equity financing from institutional and other new and existing investors as part of that transaction. Additionally, the Company satisfied the remaining payment obligations of its fixed price standby equity purchase agreement (“SEPA”) with a long-only investor in February, 2025. 2025 Guidance The Company reiterates its revenue guidance of approximately $21.5 million for FY 2025. Financial guidance for FY 2025 does not reflect contributions from the sale of the DeepView™ System for the burn indication or any additional material financial contributions that may result from the commercialization of our DeepView™ System. CONFERENCE CALL The Company will host a conference call today at 5:00 pm Eastern Time to discuss these results. Investors interested in participating in the live call can dial: 833-630-1956 – U.S.412-317-1837 – International A simultaneous webcast of the call may be accessed online from the Events & Presentations section of the Investor Relations page of the Company’s website at https://investors.spectral-ai.com/news-events/events. About Spectral AI Spectral AI, Inc. is a Dallas-based predictive AI company focused on medical diagnostics for faster and more accurate treatment decisions in wound care, with initial applications involving patients with burns. The Company is working to revolutionize the management of wound care by “Seeing the Unknown®” with its DeepView® System. The DeepView® System is being developed as a predictive device to offer clinicians an objective and immediate assessment of a burn wound’s healing potential prior to treatment or other medical intervention. With algorithm-driven results and a goal of exceeding the current standard of care in the future, the DeepView® System is expected to provide fast and accurate treatment insight towards value care by improving patient outcomes and reducing healthcare costs. For more information about the DeepView® System, visit www.spectral-ai.com. Forward-Looking Statements Certain statements made in this release are “forward looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995, including statements regarding the Company’s strategy, plans, objectives, initiatives and financial outlook. When used in this press release, the words “estimates,” “projected,” “expects,” “anticipates,” “forecasts,” “plans,” “intends,” “believes,” “seeks,” “may,” “will,” “should,” “future,” “propose” and variations of these words or similar expressions (or the negative versions of such words or expressions) are intended to identify forward-looking statements. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside Company’s control, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. As such, readers are cautioned not to place undue reliance on any forward-looking statements. Investors should carefully consider the foregoing factors, and the other risks and uncertainties described in the “Risk Factors” sections of the Company’s filings with the SEC, including the Registration Statement and the other documents filed by the Company. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. For Media and Investor Relations, please contact: David Kugelman Atlanta Capital Partners LLC (866) 692-6847 Toll Free – U.S. & Canada (404) 281-8556 Mobile and WhatsApp Email: dk@atlcp.com  Spectral AI, Inc.Condensed Consolidated Balance Sheets(in thousands, except share and per share data)   March 31, December 31,  2025 2024Assets    Current assets:    Cash $14,061  $5,157 Accounts receivable, net  2,103   2,505 Inventory  437   425 Prepaid expenses  1,287   1,289 Other current assets  840   746 Total current assets  18,728   10,122        Non-current assets:      Property and equipment, net  164   2 Right-of-use assets  1,830   1,971 Total Assets $20,722  $12,095               Liabilities and Stockholders’ Deficit      Current liabilities:      Accounts payable $3,113  $4,035 Accrued expenses  3,712   3,210 Deferred revenue  663   960 Lease liabilities, short-term  474   201 Notes payable, current  244   422 Notes payable – at fair value  -   2,365 Warrant liabilities  5,106   6,451 Total current liabilities  13,312   17,644 Note payable, long-term  7,512   - Lease liabilities, long-term  1,524   1,702 Total Liabilities  22,348   19,346        Stockholders’ Deficit      Preferred stock ($0.0001 par value); 1,000,000 shares authorized; no shares issued and outstanding as of March 31, 2025 and December 31, 2024  -   - Common stock ($0.0001 par value); 80,000,000 shares authorized; 25,588,121 and 22,594,877 shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively  2   2 Additional paid-in capital  43,684   40,973 Accumulated other comprehensive income  20   3 Accumulated deficit  (45,332)  (48,229)Total Stockholders’ Deficit  (1,626)  (7,251)Total Liabilities and Stockholders’ Deficit $20,722  $12,095  Spectral AI, Inc. Condensed Consolidated Statements of Operations(in thousands, except share and per share data)   Three Months EndedMarch 31,  2025 2024     Research and development revenue $6,707  $6,326 Cost of revenue  (3,539)  (3,381)Gross profit  3,168   2,945        Operating costs and expenses:      General and administrative  4,064   5,088 Total operating costs and expenses  4,064   5,088 Operating loss  (896)  (2,143)       Other income (expense):      Net interest (expense) income  (20)  14 Borrowing related costs  (581)  (276)Change in fair value of warrant liability  4,253   20 Change in fair value of notes payable  220   66 Foreign exchange transaction loss, net  (8)  (16)Other income (expense), including transaction costs  -   (848)Total other income (expense), net  3,864   (1,040)       Income (loss) before income taxes  2,968   (3,183)Income tax provision  (71)  (22)Net income (loss) $2,897  $(3,205) _______________________________¹ Research and Development Revenue consisted primarily of funding from the Biomedical Advanced Research and Development Authority (BARDA), part of the Administration for Strategic Preparedness and Response (ASPR) within the U.S. Department of Health and Human Services.

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