PROCEPT BioRobotics

Phase A — Understand the business

Lens 1 · Company Overview

PROCEPT is a single-product surgical-robotics company that sells one thing: a robotic treatment for an enlarged prostate (benign prostatic hyperplasia, BPH). It is a classic razor-and-blade model wearing a robotics badge:

• The razor: the AquaBeam (1st-gen, FDA De Novo Dec 2017) and HYDROS (2nd-gen, 510(k) Aug 2024) robotic systems — capital equipment placed in hospitals. US HYDROS sold at a record ~$485k ASP in Q1 2026; FY2026 system-price guidance was raised to $450–460k. The system integrates ultrasound + cystoscopy + a heat-free waterjet that robotically ablates prostate tissue ("Aquablation").
• The blade: a single-use disposable handpiece consumed every procedure (US ASP now ~$3,500 for 2026). Plus service contracts (1-yr warranty → extended service).

Revenue mix (FY2025): total $308.1M, split System sales/rentals $106.1M (+18%), Handpieces/consumables $181.4M (+49%), Service $20.5M (+61%). The consumable is now ~59% of revenue and the growth engine — the model has crossed the inflection from "sell boxes" to "sell razor-blades," which is exactly what you want in this archetype.

Customers: US hospitals (primary), plus ambulatory surgery centers, distributors and leasing companies. No customer >10% of revenue or A/R in Q1 2026 — genuinely diversified end-market. Sold via a direct US salesforce targeting urologists; mixed direct/distributor model abroad (UK + Japan now direct after reimbursement wins). Contract structure: point-in-time revenue on system + handpiece shipment (ASC 606); service ratably; a small sales-type-lease book (net investment $4.8M) — not a recurring-subscription business, so reported revenue tracks unit shipments, which becomes the central controversy (Lens 5/13). Single operating segment; CODM is the CEO. HQ San Jose, CA; ~158k sq ft owned-process manufacturing.

Lens 2 · Supply Chain

Upstream inputs → PROCEPT → end customer, named where the filing names them:

• Inputs / suppliers: components, sub-assemblies and materials "purchased from numerous global suppliers" — but "almost all of whom are single-source suppliers." This is the single most underwritten line in the whole filing. PROCEPT has supply agreements with several single-source vendors and "intends to maintain sufficient levels of inventory" as the buffer. A third-party-manufactured ultrasound system + probe ships with every robot (a named, externally-sourced sub-system PROCEPT does not control).
• Internal: PROCEPT directly manufactures the robotic system, handpiece, integrated scope and accessories in San Jose — vertically integrated on the high-value, high-margin pieces. Inventory $77.5M at Q1 2026 (raw $23.3M / WIP $12.8M / finished $41.4M).
• Logistics: a "well-known third-party logistics provider" with nodes in the US, UK and Netherlands ships globally.
• Downstream: hospital → bills third-party payors (Medicare MACs, Medicaid, commercial). Reimbursement is the real "demand" gate (Lens 1/3).

Chokepoints: (1) single-source suppliers across most components — a vendor failure stops the line; inventory is the only hedge. (2) The bundled third-party ultrasound — a dependency on an external imaging OEM. (3) Single US manufacturing facility (concentration / disaster risk). For a company this small ($308M rev) the supply chain is appropriately simple, but it is brittle, not deep.

Lens 3 · Competitive Advantages (moats)

The moat is clinical-evidence + guideline-inclusion + a category-of-one regulatory position, not scale (PROCEPT is the minnow here).

• Evidence moat: 9 clinical studies, >150 peer-reviewed publications, and the WATER trial is the only FDA pivotal BPH study randomized head-to-head against TURP (the century-old standard of care), showing superior safety, non-inferior efficacy, and superior efficacy >50ml. Five-year retreatment rates 5.2% (WATER) / 3.0% (WATER II). This is a genuinely hard-to-replicate asset — a competitor would need a decade and tens of millions to match it.
• Guideline moat: included in AUA, EAU, CUA, German Urology Society, and NICE guidelines. In Q1 2026 the EAU upgraded Aquablation to a "strong recommendation" — a real catalyst for international adoption and a moat-widener.
• Reimbursement moat: 100% of Medicare MACs cover it (since 2021); ~95% of US men have payer access; and effective Jan 1, 2026 Aquablation got a permanent Category I CPT code (52597), replacing the temporary Cat-III code — paid similarly to a TURP. A Cat-I code is the difference between "experimental billing" and "standard reimbursed procedure."
• Switching costs: modest-but-real — once a $450k+ robot is installed and a hospital's urologists are trained, the disposable annuity and the workflow lock-in create stickiness; the install base (971 globally / 765 US at Q1 2026, up from 912/718 at YE2025) is the recurring-revenue flywheel.
• IP: 73 issued US patents (expiring 2028–2042) + 157 foreign, 40 US applications pending; exclusive royalty-free licenses from AquaBeam LLC (to ~2037) and HydroCision (to ~2039).

Bargaining power: WEAK over suppliers (single-source — they hold the cards) and MIXED over customers (hospitals are price-sensitive bulk buyers — the IDN price war is the FY2025 story). The moat is product/clinical/regulatory, not commercial muscle. Against a Boston Scientific or Teleflex with 10x the salesforce, that evidence moat is the only thing keeping PROCEPT in the game — but it is the right moat for category creation.

Lens 4 · Segments

Single reportable segment, so the cut is by product line and geography:

By product (FY2025 vs FY2024):

By geography (FY2025): US $270.4M (88%) / OUS $37.7M (12%). OUS grew faster off a tiny base (FY2024 $24.0M → FY2025 $37.7M, +57%). US revenue carries higher ASPs and gross margin — mix toward US is margin-accretive, mix toward OUS is dilutive. The three-year ramp is dramatic: total revenue $136.2M (2023) → $224.5M (2024) → $308.1M (2025) — a company that roughly doubled in two years. Trend + cause: consumable share is climbing as the install base compounds (the model maturing); the deceleration to watch is the quarterly YoY (Lens 5).

---

Phase B — Measure performance

Lens 5 · Earnings Result (latest print — Q1 2026, period ended 2026-03-31)

[All figures research-layer: filings/10-q-2026-q1.md unless tagged.]

• Revenue $83.1M, +20% YoY (vs $69.2M Q1 2025). Beat consensus ~$80.5M. But this is a sharp deceleration from Q3 2025's +43% ($83.3M) and the pre-announced Q2 2025 +48% — the growth rate halved.
• Gross margin 64.9% (vs 63.9%) — and management flagged a recovery to 65% from 61% in Q4 2025 driven by handpiece pricing discipline + scale leverage.
• Operating loss $(32.6)M; net loss $(31.6)M; EPS $(0.56) (vs $(0.45)). Loss widened YoY because opex (R&D +31% to $21.5M, SG&A +18% to $65.1M) outran the 20% revenue print — the deliberate-slowdown quarter still spent like a 40%-grower.
• The story under the number: ~12,200 US procedures (+~30% YoY), 49 HYDROS systems at ~$485k ASP, 7 HYDROS in the first UK launch at >$400k, 2 trade-in replacements. So real demand (procedures) grew ~30% while reported revenue grew 20% — the gap is the deliberate purge of channel-stuffed handpieces (see below).
• Balance sheet: cash $245.6M (down from $286.5M at YE — burned ~$41M in the quarter, of which OCF was $(38.1)M, more than 2x the $(17.0)M of Q1 2025 — seasonally the heaviest-burn quarter, driven by a $13.3M A/R build + $7.0M inventory build). Long-term debt $51.7M (CIBC term loan, SOFR+2.25%, ~5.9%, due Oct 2027, balloon). Accumulated deficit $673.2M. No going-concern flag; 12-month runway affirmed — but on a ~$130–150M annualized burn against $246M cash, the CIBC loan ($52M due Oct 2027) + the cash trajectory put a capital raise squarely in the 2026–27 window (the filing itself lists equity/debt issuance as the contingency).
• Market reaction context: the print beat, but the stock has been cut roughly in half over twelve months — the damage was done at Q4 2025 (Feb 26, 2026), not Q1.
• Unusual vs own history: the Q1 2026 A/R jump (+$13.3M) and the OCF doubling are the items to watch; both are explained by commercialization scale + timing, but A/R outrunning revenue is a yellow flag to re-check next quarter (Lens 10).

Lens 6 · Earnings Calls (sentiment trend)

No transcripts on the shelf (transcripts/ empty) → ``. Tone has shifted hard across the last ~3 calls:

• Q2 2025 (pre-announce, Jul 2025): euphoric — +48% pre-announced growth, paired with the CEO-succession news. Peak optimism.
• Q4 2025 (Feb 26, 2026): the mea-culpa / reset call. Management disclosed that handpiece sales had been running ahead of actual procedures (channel inventory), changed "inventory practices" so handpiece units track procedure volume, layered on pricing discipline, and realigned the commercial org (dedicated launch teams, regional integration, tighter account management). They cut FY2026 guidance to $390–410M and Q1 to $79–82M (vs ~$93.7M consensus). The recurring new vocabulary: "durable procedure growth," "pricing discipline," "launch teams," "activation variability."
• Q1 2026 (Apr 30, 2026): steadying-the-ship call under new CEO Larry Wood. Beat the reset bar; emphasized 30% procedure growth "in line," record ASPs, the UK launch, the EAU upgrade, FirstAssist AI 2nd-gen clearance, and the HYDROS replacement cycle as a 2027 (not 2026) driver. What they stopped saying: the unqualified hyper-growth framing. What they started saying: quality-of-revenue, discipline, "in line with expectations." This is a management team deliberately resetting the narrative from growth-at-any-cost to durable, higher-quality growth — credible if you trust the operator, a red flag if you think it's demand-saturation in a discipline costume.

Lens 7 · Comps

PRCT is unprofitable, so P/E, EV/EBIT, dividend yield and ROE are n/a — not meaningful for the subject; only EV/Sales is comparable. Profitable peers are shown for context on what a "graduated" robotics/medtech multiple looks like. All multiples ``; where not separately sourced, marked n/a.

Read: at ~4x EV/Sales on a ~30%-procedure-grower with 65% GM and a widening path to scale, PRCT is not expensive on a growth-adjusted basis vs where ISRG (~the only true surgical-robotics pure-play comp) trades on earnings. The bull frame: PRCT today rhymes with early ISRG — a single-procedure robotic razor-and-blade before the multiple-procedure, profitable re-rate. The bear frame: ISRG earns its multiple (17% ROE, FCF machine); PRCT burns cash and has one indication. The honest read: EV/Sales ~4x is a fair-to-cheap price for the growth IF procedure growth holds and margins keep climbing — and a trap if FY2025's reset was the first crack in the demand story.

Lens 8 · Stock-Price Catalysts (moves >5%, last ~year)

PRCT's tape is brutally earnings-and-guidance-driven — a textbook single-asset growth-stock volatility profile. 52-week range $19.35–$62.17/$66.85 (~70% peak-to-trough). Current ~$28.81 (2026-06-10).

• Jul 24, 2025 (↑): CEO succession + 48% Q2 pre-announce — momentum peak.
• Feb 26, 2026 (↓, the big one): Q4 2025 miss + FY2026 guide-down to $390–410M and Q1 to $79–82M (vs ~$93.7M consensus) → new 52-week low, stock roughly halved over the surrounding months. BofA → Underperform, PT $20; Oppenheimer → Perform.
• Apr 30, 2026 (↑ modest): Q1 beat the reset bar; relief. Pattern / what the market reacts to: guidance and quarterly growth-rate, almost nothing else. This is not a macro or single-customer name — it is a "did the growth narrative hold this quarter?" name. The market has zero tolerance for a growth-rate disappointment in an unprofitable compounder, which is precisely why the FY2025 quality-of-revenue reset detonated the multiple even though procedures grew 30%.

---

Phase C — Judge people & books

Lens 9 · Management

The single most important variable in this dossier is the September 2025 CEO change.

• Larry L. Wood — President & CEO since Sept 2, 2025. Track record: ~18 years at Edwards Lifesciences running Transcatheter Aortic Valve Replacement (TAVR) — the division he led to $4.1B in 2024 sales — plus Group President of Surgical Structural Heart ($981M, 2024); together 94% of Edwards' revenue. 35–40 years in medtech (Edwards + Baxter). This is the highest-pedigree hire PROCEPT could have made: TAVR is the canonical "minimally-invasive robotic/transcatheter therapy displacing open surgery, won on clinical evidence + guideline inclusion + reimbursement" playbook — structurally identical to Aquablation-vs-TURP/prostatectomy. He has literally already built the thing PROCEPT is trying to become. That he left the crown jewel of Edwards for a sub-$2B single-asset name is a meaningful conviction signal.
• Dr. Reza Zadno — retired Sept 1, 2025. CEO since 2020; took the company public (2021 IPO), drove Aquablation commercialization and launched the prostate-cancer trials. A clean, planned, "founder-stage-builder hands to scale-stage-operator" succession — not a crisis exit.
• Kevin Waters — EVP & CFO (offer letter 2018; long-tenured). Adopted a Rule 10b5-1 plan (Mar 18, 2026) to sell up to 59,127 shares through Jun 2027 — routine, pre-arranged, small relative to the float; note but don't over-weight. Alaleh Nouri — Chief Legal Officer.
• Skin in the game / insider ownership: no insider-transactions.csv on the shelf and Part III incorporated by reference to the proxy → insider ownership n/a (chase the 2026 DEF 14A). SBC is heavy (FY: 13.3M unvested RSUs at $36.18 + $130.3M unrecognized RSU expense; $13.1M SBC in Q1 alone) — alignment via equity is high, dilution cost is real (Lens 10).
• Capital allocation: pre-profit, so the "allocation" is R&D + commercial build + clinical trials, funded by prior equity raises ($164.5M raised in 2024). No buybacks/dividends (appropriate). The one judgment call — letting handpiece channel inventory run ahead of procedures, then resetting it — is the blemish, and it happened on the prior regime; Wood is cleaning it up.
• Red flags: none material — no related-party deals beyond the benign AquaBeam/HydroCision IP licenses; no promotional going-concern games; comp is equity-heavy but standard for the stage. Archetype: the company is transitioning from founder/clinician-led to professional-scale-operator-led — and got an A-list operator. This is the bull's most under-priced fact.

Lens 10 · Forensic Red Flags

Forensic lens — every figure research-layer unless tagged.

• The real one — quality of revenue / channel stuffing (now self-disclosed): the FY2025 issue was handpiece sell-in running ahead of procedure sell-through — i.e., revenue was being pulled forward via customer stocking. Management itself flagged and corrected it (changed inventory practices so units track procedures). Credit for transparency, but it confirms reported consumable revenue was over-stating underlying demand in 2024–25 — re-underwrite the handpiece line on a procedures × ASP basis (~12,200 US procedures/qtr × ~$3,500), not on shipped units.
• A/R outrunning revenue: A/R rose to $96.4M at Q1 2026 from $83.5M at YE (+15.4% QoQ) while revenue was roughly flat sequentially — a divergence to watch. DSO is climbing. Allowance for credit losses is tiny ($1.25M) and rising slowly. Not alarming yet given hospital customers, but it is the exact metric that hides a channel problem — flag for next quarter.
• Inventory build: $77.5M (+10% QoQ), finished goods $41.4M — consistent with a launch ramp (HYDROS) but also with softening pull-through; the $0.27M write-down is immaterial. Watch finished-goods days.
• Cash flow vs earnings: OCF $(38.1)M in Q1 vs $(31.6)M net loss — cash burn exceeds the accounting loss because of the working-capital build (A/R + inventory). This is the honest, conservative direction (no flattering of cash via stretched payables).
• SBC flattering non-GAAP: SBC is large — $13.1M in Q1 2026 (~16% of revenue) and >$50M run-rate — and PROCEPT, like all medtech, will tout adjusted/EBITDA figures that add it back. The dilution is real: shares 56.9M (Q1 2026) up from 54.7M (YE2024); 8.3M dilutive securities overhang. Treat any non-GAAP "profitability" with the SBC haircut intact.
• Leases / debt / related parties: clean. Operating leases $26.3M PV (single SJ facility). CIBC loan secured by substantially all assets incl. IP — standard venture-debt collateral. IP licenses (AquaBeam LLC, HydroCision) are old, royalty-free, immaterial-payment — not a related-party concern.
• Auditor: PwC (San Jose), unqualified opinion on both financials and ICFR; ICFR effective; no material weaknesses; critical audit matter = Robotic Systems revenue recognition (i.e., the auditor's own focus area is exactly the revenue-timing question above).

Regulatory findings (required sub-section):

• SEC Litigation Releases / AAERs: None. regulatory/regulatory-findings.md (generated 2026-06-20 via EDGAR EFTS, LR + AAER, period 2021–2026): 0 SEC findings.
• 10-K Item 3 (Legal Proceedings) + Q1 Item 1: "not presently a party to any legal proceedings that…would have a material adverse effect". No active IP litigation and no patent-infringement notices received as of YE2025.
• Non-SEC enforcement (FDA/DOJ/FTC) web check: no material enforcement hits surfaced; the relevant FDA exposure is prospective/regulatory (Class II device, QMSR effective Feb 2, 2026, recall/warning-letter risk inherent to medtech), not a current action.
• Verdict: No material regulatory or legal findings — verified via SEC EDGAR EFTS (LR, AAER), 10-K/10-Q Item 3, and web search as of 2026-06-20.

---

Phase D — Project & stress-test

Lens 11 · Forward Projection (FY2026 / FY2027 / FY2028)

PRCT is loss-making, so the scoreable line is revenue + path-to-breakeven, not EPS (EPS stays negative through the window on every realistic path). Built bottom-up from the Q1 2026 actual + company guidance.

Anchors: FY2025 revenue $308.1M; FY2026 guidance $390–410M (+27–33%), reaffirmed at Q1; FY2026 EPS guide ~$(1.54)–(1.55); ~30% procedure growth + raised system ASP ($450–460k) + ~$3,500 handpiece ASP as the build blocks.

Margin / breakeven path: GM ~65% and rising toward high-60s with scale + US mix + pricing discipline; opex growing slower than revenue post-realignment (the whole point of the reset). On the base path, operating-loss narrows materially through FY2027 and PROCEPT plausibly approaches operating breakeven in FY2028 at ~$600M revenue — but a capital raise (equity or refinanced debt) before the CIBC maturity (Oct 2027) is likely given the cash trajectory ($246M cash, ~$130–150M annual burn). Dilution is the base-case tax on the equity.

Scoreable forecast (logged conceptually; forecast.ts create skipped per --watchlist rule): PRCT FY2026 revenue >= $400M, p = 0.60, resolves 2027-02 (FY2026 10-K). Rationale: guidance reaffirmed twice, Q1 beat the bar, but the FY2025 reset proves management's own visibility is imperfect — 60%, not higher.

Lens 12 · Bull vs Bear

Bull case. PROCEPT is early-ISRG in urology: a clinically-superior, guideline-endorsed, fully-reimbursed (Cat-I CPT) robotic razor-and-blade attacking a $30B US TAM where surgery is under-penetrated (only ~400k of millions of candidates get surgery annually) and the standard of care (TURP) is a 100-year-old electrocautery procedure with ugly side-effect rates. Real demand is compounding ~30% (procedures), the consumable annuity is now 59% of revenue and growing 49%, gross margin is climbing (61%→65%), the install base flywheel (765 US systems) throws off recurring handpiece revenue, and there are three stacked call options the market is discounting to zero: (1) Larry Wood, the man who built Edwards' $4B TAVR franchise, now running the identical playbook; (2) prostate-cancer expansion (WATER IV PCa pivotal vs radical prostatectomy — a TAM-doubling indication); (3) the HYDROS replacement cycle kicking in from 2027. At ~4x EV/Sales after a ~50% de-rate, you're paying a fair-to-cheap price for a 30% grower with a widening moat and an A-list operator.

Bear case (permanent-impairment risks). (1) The FY2025 reset is the first crack in a demand wall, not a clean-up. If letting customers over-stock handpieces was masking saturating procedure demand among early-adopter urologists, then "durable procedure growth" decelerates structurally and the whole single-asset thesis unwinds — there is no second product to catch the company. (2) Boston Scientific and Teleflex (10x+ the resources, existing UroLift/Rezum/laser franchises, full payer coverage, entrenched urology relationships) decide the BPH-robotics TAM is worth contesting and out-sell PROCEPT's thin direct force. (3) Capital structure: ~$130–150M annual burn on $246M cash + a $52M loan due Oct 2027 forces a dilutive raise into a de-rated stock. Pre-mortem (18 months out, thesis broke): procedure growth decelerated below 20%, a competitor launched a credible robotic BPH device, the handpiece base never re-accelerated post-purge, the company raised equity at $22 diluting 15%, and the multiple compressed to 2.5x EV/Sales → stock halves again. Are multiples too high? No — ~4x EV/Sales is not the problem; the problem is durability of the numerator. Contrarian view (what the market refuses to see): the market is pricing the FY2025 reset as a demand failure when the procedure data (+30%) says it was a quality-of-revenue clean-up, and it is assigning ~zero value to the single best operator hire in small-cap medtech this cycle. If procedures hold 25%+ for two more quarters, the de-rate reverses violently.

Lens 13 · Devil's Advocate (short-seller)

Dismantling the bull case.

• What structurally breaks the model: PROCEPT sells one procedure for one disease. There is no diversification cushion. If BPH-robotics adoption plateaus — because early-adopter urologists are tapped, because hospitals balk at $450k capital in a tight budget cycle, or because the side-effect advantage isn't enough to overcome TURP's "good-enough + free" incumbency — the entire enterprise decelerates at once. The FY2025 reset is the first data point consistent with that.
• Revenue concentration / shift: not customer-concentrated (good) but 100% indication-concentrated and ~88% US-concentrated. The consumable line — 59% of revenue — was just revealed to have been inflated by channel stocking; strip that and the "durable" base is smaller than the headline suggested.
• Why the moat is weaker than bulls think: the moat is clinical evidence, which protects against a me-too but not against a well-resourced incumbent who can fund their own trials. Boston Scientific already owns the BPH category economically (Rezum + lasers) and has the salesforce, payer relationships and balance sheet to outspend PROCEPT into a corner if it chooses. PROCEPT's evidence lead buys time, not invulnerability.
• Most dangerous competitor bulls underestimate: Boston Scientific — not because it has a better device today, but because it has every commercial lever PROCEPT lacks and a direct strategic interest in defending its BPH franchise.
• Worst capital-allocation / accounting: the handpiece channel-stuffing (now disclosed) + heavy SBC (~16% of revenue) flattering adjusted metrics + a looming dilutive raise. None are fraud; all erode per-share value.
• Assumptions that must hold for today's price (~$28.81, ~$1.58B): ~30% procedure growth holds for years; gross margin keeps climbing; the company reaches breakeven before a punitive raise; no incumbent counter-attack. If growth disappoints 20–30% (say FY2026 lands at $360M not $400M), EV/Sales compresses toward 2.5–3x on a lower base → stock to ~$18–20 (right where BofA already pegged it).
• Single scenario that permanently impairs: a credible robotic BPH competitor from Boston Scientific/Teleflex + a simultaneous procedure-growth stall, forcing PROCEPT into a down-round equity raise from a position of weakness — single-asset company, no fallback, dilution spiral. Plausibility: moderate — not the base case, but far from tail, and the FY2025 reset raised its probability.

Lens 14 · Management Questions (ordered by information value)

1. Of the ~30% procedure growth in Q1, how much came from new accounts vs. rising utilization in existing accounts — and is per-system utilization in your oldest cohorts still rising or plateauing?
2. Now that handpiece sell-in is reset to track procedures, what is the true organic handpiece growth rate stripped of the prior channel inventory — and when does reported consumable revenue re-accelerate to match procedure growth?
3. How saturated is the early-adopter urologist base, and what is the realistic ceiling on the 765-system US install base before you're selling to laggards?
4. Larry — you built Edwards' TAVR franchise from category-creation to $4B. What specifically from that playbook applies to Aquablation, and what doesn't (reimbursement is already largely won here)?
5. What is the capital plan — given ~$130–150M annual burn, $246M cash, and the $52M CIBC loan due Oct 2027, when and how do you expect to fund the gap, and what dilution should shareholders model?
6. What would a Boston Scientific or Teleflex robotic BPH entrant have to do to threaten you, and how defensible is your evidence/guideline lead against a well-funded incumbent trial program?
7. On the HYDROS replacement cycle — what % of the AquaBeam install base do you expect to trade in, at what economics, and why is it a 2027 not 2026 driver?
8. What is the path and timeline to operating breakeven, and at what revenue level does the model inflect to cash generation?
9. Prostate cancer (WATER IV PCa): what readout timeline, what's the regulatory/reimbursement path vs radical prostatectomy, and how should we size that TAM option?
10. Gross margin went 61%→65% on pricing discipline + scale — where does GM structurally settle, and how much is price (fragile) vs cost (durable)?
11. On single-source suppliers across most components — what is your dual-sourcing roadmap and worst-case line-down exposure?
12. International: UK HYDROS launch sold 7 systems at >$400k and EAU upgraded you to "strong recommendation" — which 2–3 markets are next, and what's the OUS margin drag as mix shifts?
13. What were the root causes of the FY2025 commercial misalignment, and what concretely is different in the realigned org so it doesn't recur?
14. How do you think about SBC at ~16% of revenue trending down, and the dilution trajectory shareholders should expect over the next three years?

---