Ceribell Inc (CBLL) 2025 Q1 法說會逐字稿

Hello. Thank you for standing by.

At this time, I would like to welcome you to the CeriBell Q1 2025 earnings call.

(Operator Instructions)

I would now like to turn the conference over to Elizabeth Sparicio, Investor Relations. Please go ahead.

Good afternoon. Thank you all for participating in today's call.

Joining me from CeriBell are Jane Chao, Co-Founder and Chief Executive Officer; and Scott Blumberg, Chief Financial Officer.

Earlier today, CeriBell issued a press release announcing financial results for the quarter ended March 31, 2025. A copy of the press release is available on the Investor Relations section of the company's website.

Before we begin, I'd like to remind you that management will make statements during this call that include forward-looking statements, within the meaning of Federal Securities Laws; and that these are being made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995.

Any statements contained in this call that relate to expectations or predictions of future events, results, or performance are forward-looking statements. These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated or implied by these forward-looking statements.

Accordingly, you should not place undue reliance on these statements.

For a list and description of the risks and uncertainties associated with our business, please refer to the Risk Factors section of our public filings with the Securities and Exchange Commission, including our annual report on Form 10-K, filed with the SEC on February 25, 2025.

This conference call contains time-sensitive information and is accurate only as of the live broadcast, today, May 8, 2025. CeriBell disclaims any intention or obligation, except as required by law, to update or revise any financial projections or forward-looking statements, whether because of new information, future events, or otherwise.

With that, I will turn the call over to Jane.

Thanks, Elizabeth. Good afternoon. Thank you, all, for joining us on our first-quarter 2025 earnings call.

Today, I share the key highlights from our first-quarter results, as well as our strategic priorities for 2025. Scott will, then, provide a more detailed analysis of our financial performance and discuss our full-year 2025 guidance.

The first quarter marked a strong start to the year for CeriBell. We delivered robust revenue growth and made measurable progress across every strategic initiative outlined on our last call.

Total revenue, for the first quarter of 2025, was $20.5 million. This reflects 42% growth over the same period last year and 11% growth over the fourth quarter of 2024.

We were also pleased to deliver 88% gross margin in Q1. Once again, our strong Q1 performance was driven by our team's continued success in acquiring and launching new accounts, while also driving utilization across our account base.

As Scott will detail, our first-quarter performance has given us greater conviction in revenue growth expectation for the full year of 2025. Importantly, we are also reaffirming our confidence in achieving profitability in the future, using only current cash-on-hand, despite a dynamic trade environment

Underpinning our growth is the clinical value that we deliver to our customers every day.

As of March 31, 2025, we had 558 active accounts, representing an increase of 29 during the first quarter. Among these were our first cohort of VA hospitals, where our Clarity algorithm has now been integrated.

This followed the receipt of authority to operate from the federal government in November 2024. This ATO is a testament to CeriBell's ability to comply with extensive cybersecurity standards, which have become increasingly important for hospitals.

More recently, we are proud to have also received FedRAMP High authorization from the US government. This represents an even more significant validation of our cybersecurity standards and enables other government agencies to utilize the CeriBell system.

For context, FedRAMP High is the US government's most stringent category for review of cloud-enabled technology that handle highly-sensitive information. Following this authorization, CeriBell is one of the only 51 companies and the only medical device manufacturer to have received this authorization.

While we are delighted by our success, to date, we believe that we are still in the early stage of the adoption curve for our products. Based on our market research and assumptions, we only serve around 3% of the US populations who could benefit from our technology.

We're confident in our ability to leverage our unmatched AI capability and extensive clinical evidence to establish CeriBell as the standard of care.

Through Q1, we continued to invest in and expand our commercial organization. We are on track to meet our goal of expanding our account acquisition team to 55 territory managers by mid-2025.

Given the nature of our sales cycle, we expect that this expansion will begin impacting our rate of account acquisition growth in 2026. Meanwhile, we are continuing to invest in our Clinical Account Manager, or CAM, team to serve our growing account base.

As, by far, the most studied and proven rapid EEG solution on the market, we have also continued to build on our efforts to expand awareness regarding the clinical and economic benefits of CeriBell. We are directly engaging with clinicians; investing in marketing initiatives; and. importantly, generating further clinical and health economic data.

During the first quarter, we are pleased to see three separate publications reinforce the clinical benefit of using CeriBell. These papers articulated the advantage of nursing-driven rapid EEG protocols, the clinical value of assessing seizure in stroke and stroke mimic patients, and the significant decrease in time to diagnose and treat in-pediatric patients for CeriBell EEG cohort, when compared to using conventional EEG.

Beyond investing in sales and marketing efforts, we are also investing in our product development pipeline. Our goal remains to make EEG a new vital sign. We believe these investments will enable us to extend the benefits of our technology to even more patients.

Recently, we were thrilled to receive FDA 510(k) clearance of Clarity for seizure detection in pediatric patients. Clarity is now the first and only FDA-cleared seizure detection algorithm indicated for patients aged one year and above, thereby expanding our addressable patient population.

The development of our pediatric algorithm was supported by EEG data collected from over 1,700 patients. FDA data indicates that this is the largest validation data set ever used for FDA clearance of a seizure detection algorithm. This reflects the scale of our extensive EEG database and the rigor of our algorithm and validation process.

Our pediatric Clarity algorithm is designed to be used with our existing CeriBell EEG head bands, which are already cleared for use in patients of all ages. We believe CeriBell, with Clarity, will have a profound impact on the lives of children at risk of seizure, who are particularly vulnerable to preventable secondary brain injury caused by seizure. In fact, seizures are a leading neurological cause of pediatric visits to emergency department.

Studies have also shown that up to 98% of pediatric patients in ICU who experienced just 12 minutes of seizure, in a one-hour window, suffer from neurological decline. Yet, despite EEG being critical for appropriate patient management, pediatric patients in the ED are often discharged without any EEG.

These children often receive their first EEG in the outpatient setting, days, weeks, or even months later; and, sometimes, not at all.

We estimate that 80% of pediatric emergency department visits occur at general or non-children's hospital, which represents our core customer base, today.

Yet, there is typically a significant shortage of pediatric epileptologists in general EDs. This shortage results in potentially even greater clinical gaps than for adult population.

Clarity is a powerful tool to help both epileptologists and ED physicians fill these gaps.

Following this clearance, we plan to conduct a limited commercial release and pilot. Specifically, we will focus on pediatric expansion within our existing ED accounts, as well as children's hospitals. This will enable us to better understand how to best leverage the natural synergies of the pediatric Clarity opportunity with our existing product and ED strategy, as well as potential future indications, including Clarity for neonates.

Ultimately, we will refine our broader go-to-market strategy with an even more comprehensive offering for the wider population.

To summarize, this pediatric clearance marks the first step on our path to entering another exciting segment of our core seizure market. We look forward to providing more updates in our next call.

Moving to our pipeline. We are pleased to report that the timeline for other opportunities discussed on our last earnings call -- specifically, neonate Clarity and Delirium -- remain on track. On a go-forward basis, we intend to provide pipeline updates only on clearances or other meaningful regulatory or strategic changes.

At a high level, we feel our pediatric clearance is illustrative of some of the unique dynamics inherent in our regulatory and commercialization pathways.

First, there is a very high degree of synergy and interdependency across our existing products and anticipated future indications. Second, we are truly pioneering novel solutions and endeavoring to improve care by transforming care pathways. Third, we believe the regulatory frameworks for our potential new indications are faster and lower cost compared to those for most medical devices, due to the nature of algorithm development and ability to leverage our extensive EEG database and AI expertise.

As a result, we want to be incredibly strategic and precise in how we bring this potentially transformational innovation to market. We anticipate using at least one year, following regulatory clearance of any indication-related product expansions, to pilot our approach and potentially continue to optimize our products.

We believe this will allow us to refine our messaging and sales approach and better understand how the new product offering impacts the hospital workflows. We expect this will enable us to most effectively bring products to market quickly; while optimizing our business plans, based on real-world feedback.

This has been a successful strategy for CeriBell since the initial introduction of Clarity in 2020. We are excited to replicate our proven approach with pediatric Clarity and our future product launches.

Our near-term focus will remain on expanding CeriBell access to millions of patients who are receiving delayed or suboptimal diagnosis due to the inherent limitation of the conventional EEG. Over time, these incremental patient populations will meaningfully impact our total addressable market and stand to create real growth upsides.

Importantly, we believe we will be able to target these novel patient populations within our existing call points, largely by leveraging our existing sales force.

We're encouraged by our progress in Q1. And we'll continue focusing on initiatives to sustain growth through 2025 and beyond.

Specifically, we plan to invest in our commercial organization to drive adoption of the CeriBell system for seizure detection in both new and existing accounts; continue to drive awareness of seizures in the acute care setting by maintaining a leading presence in generating clinical and economic evidence; and, finally, make further strides in expanding our market through further product development and commercial launches.

With that, I'll now turn the call over to Scott Blumberg, our CFO, to provide a review of our first-quarter results and outlook for the remainder of 2025.

Thank you, Jane. Good afternoon, everyone.

As Jane mentioned, total revenue for the first quarter was $20.5 million, a 42% increase from $14.4 million in the same period of the prior year. The increase was primarily driven by continued commercial expansion, resulting in increased adoption of the CeriBell system across new and existing accounts.

Within existing accounts, we saw strong growth in usage and purchase trends. We attribute the success to our CAM strategy, plus the benefits of seasonal trends, including many hospitals' increased ICU patient census in the winter months.

Product revenue, from the first quarter of 2025, was $15.6 million, representing an increase of 41% from $11.0 million in the first quarter of 2024. Subscription revenue, for the first quarter of 2025, was $4.9 million, representing an increase of 45% from $3.4 million in the first quarter of 2024.

Gross margin, for the first quarter of 2025, was 88% compared to 86% in the prior year period.

Total operating expenses, for the first quarter of 2025, were $32.2 million, an increase of 55% compared to $20.8 million in the first quarter of 2024. Non-cash stock-based compensation expense was $2.3 million in the first quarter of 2025. The increase in operating expenses was primarily attributable to investments in our commercial organization, increased headcount to support the growth of the business, and expenses related to operating as a public company.

More specifically, we continue to make key hires across our sales and marketing and R&D teams. As it relates to our sales force, as Jane noted, we are on track to achieve our goal of 55 territory managers by midyear and are continuing to strategically expand our TAM team. We expect further opportunistic investments in our commercial team to continue through 2025.

Meanwhile, we are maintaining our expectation that stock-based compensation expense will contribute approximately $50 million to total operating expenses for the full-year 2025.

As a reminder: we expect expenses associated with the annual equity grant process to increase beginning in Q2.

Net loss was $12.8 million for the first quarter of 2025 or a loss of $0.36 per share compared to a loss of $8.5 million or a loss of $1.56 per share in the first quarter of 2024. An average weighted share count of 35.9 million shares was used to determine loss per share in the first quarter of 2025.

Our cash, cash equivalents, and marketable securities, as of March 31, 2025, were $182.7 million.

Turning, now, to our outlook for the remainder of 2025.

Given our momentum in the first quarter of 2025, we now expect full-year 2025 total revenue to range from $83 million to $87 million, up from our prior guidance of $81 million to $85 million, which represents annual growth of 27% to 33% over 2024.

Moving down the P&L. Even in the face of substantially-increased tariffs on goods imported from China, we continue to expect gross margins for the full-year 2025 to be in the mid-80% range. This contemplates our high degree of confidence in our expectation for current product inventory located within the United States to fully meet demand through, at least, the third quarter of 2025.

Therefore, we do not expect to see any material impact to gross margins and incremental tariffs on imports from China until, at least, the fourth quarter of 2025.

Looking ahead, under the latest assumption -- which is the imports from China will be subject to 145% in tariffs, in addition to the 25% in tariffs that have been in place since 2018 -- we believe the impact to our gross margin, from the new tariffs, will still be less than 10 percentage points. This compares to gross margins of 88% in the first quarter of 2025.

To be clear: this assumes no change in currently-proposed tariffs and no benefit from our own mitigation strategies, including potentially reshoring our manufacturing, which we are actively considering. When we have greater clarity regarding international trade policies, we are confident in our ability to move quickly to fully execute these contingency plans; likely within a matter of quarters, not years.

Independent of potential tariff-mitigation efforts, we are also leaning further into our pre-existing cost reduction strategies, the effect of which would be amplified, if current proposed tariffs remain in place.

Ultimately, based on what we know today, we are confident in our ability to maintain a strong, above-industry average gross margin, around 80% in the medium term; with a clear path to continue to deliver margins in the mid-80% range, over the medium to long term. This is due to our mitigation strategies, which we believe are quickly actionable; our relatively low nominal cost basis for goods imported from China; and the fact that 25% of our revenue comes from subscription products, which generate a 97% gross margin and are not subject to tariffs.

And, finally, even assuming the current tariff rate and no incremental revenue from pipeline initiatives, we continue to have a great deal of conviction in our ability to reach cash flow breakeven with current cash, on hand.

With that, I'll turn the call back to Jane.

Thank you, Scott. Thank you, all, for your time today.

In conclusion, I'm very pleased with our strong first-quarter performance, which positions us well for continued success through 2025 and beyond.

I'd like to thank our CeriBell employees for their continued commitment to our customers and the patients we serve.

Finally, we appreciate your support and continued interest in CeriBell. We look forward to providing you with updates on our progress in the quarters to come.

I will now turn the call over to the operator for any Q&A. Operator?

Thank you. We will now begin the question-and-answer session.

(Operator Instructions)

Travis Steed, Bank of America.

Hi. This is Stephanie Piazzola, on for Travis. Congrats on the good quarter. Thanks for taking the question.

I wanted to ask on Q1: you beat by $1 million and you're raising the full-year guide by about $2 million at the midpoint. So I wanted to ask what's driving the raise in the guide by more than the beat and what now looks better versus your previous expectation?

And, just thinking about cadence, do we see that raise show up in any particular quarter?

And then, I have a follow-up.

Hi, Stephanie. Thanks for the question.

Yeah. We beat consensus by about $1 million in Q1. I think, more than that, we got greater confidence in all of the strategies that we've been implementing, both on the account acquisition and account management side.

I think you'll see our usage per account has grown pretty substantially, Q1 over Q4.

As we said in our prepared remarks, we expect that there's a little bit of seasonality in that number. But we have a high degree of confidence that our strategies are working. So it's really a matter of an additional quarter of visibility and execution that's giving us the confidence to raise.

Great. And then, for my follow-up, I just wanted to ask a little bit more on tariffs and your ability to keep gross margin for the year in the same mid- to high-80% range, despite tariffs potentially having some impact in Q4 and just your confidence there.

And then, on a full-year basis, you mentioned a less than 10-point impact to gross margin. That doesn't include any mitigation, I believe you said. So just curious if you could elaborate on potential mitigation actions that you could take to potentially offset some of that headwind.

Sure. Well, first of all, acknowledging that the trade environment is incredibly dynamic with that caveat.

As I mentioned, we have about two quarters of runway, here, where we're operating off of inventory that was acquired before the tariffs. So we don't expect an impact over the coming couple of quarters.

In Q4 and in early 2026, we would expect some impact; the degree of which really depends on what the ultimate policy is and how much clarity there is.

And then, the comment about returning to the mid-80% range is really dependent on how quickly we get that clarity so we can execute on the strategies.

As far as the strategies go, I think it's important to acknowledge that we didn't get to 88% margins by chance. We've really focused on supply chain, extensively, since the beginning of the company.

A lot of the strategies we have in place were things we're already working on. We've really doubled down and accelerating them.

One is automation. Second is cost negotiation with vendors. Third is reduction of cost of shipping.

One thing that's important to note is that some of these cost-reduction initiatives, under the current tariff structure, would have a synergistic effect where it would magnify, as it would lower the nominal cost base of the product.

And then, ultimately, we are looking at -- and have pretty detailed plans for -- reshoring. But we're really waiting for greater clarity on where the ultimate US trade policy settles, before we execute on those plans. But they're ready to go.

And, as I mentioned, that will take a couple of -- a few quarters to execute on, not a few years.

Robert Marcus, J.P. Morgan.

Hi. This is actually [Rohan], on for Robbie. Congrats on a nice quarter. Thanks for taking our question.

I wanted to start off and follow up on the gross margin point but zero in on OpEx. You reiterated the expectation of reaching cash flow breakeven with the current cash, on hand.

So I just want to get a sense for your thoughts on OpEx this year, between SG&A and R&D; and then, how you're thinking about that trending, maybe, a bit longer term?

And then, I had a follow-up, as well.

Yeah. As it relates to the impact of tariffs on margins, I think it's important to note that we expect the impact to be transient. So it's bounded, since we expect to be in the mid-80% range in the not-too-distant future.

As it relates to OpEx, some of the investments we made -- which we outlined on our last earnings call -- are related to the capital raised in the IPO, which was substantially more than we initially intended to raise. So we are investing a bit more than we had previously intended, before the IPO on R&D.

We're also looking at opportunistic areas to invest in sales infrastructure to drive growth. One example is that we're running a pilot on driving usage within the emergency departments. And our strategy is generally to run commercial pilots; and then, if it works well, double down; and if it's not working well, adjust.

With the capital we raised, we feel very confident in our ability to do that.

We understand the critical importance of achieving positive cash flow without additional capital. So we're always keeping our eye on that. We have a very high degree of confidence that we can execute that while making these additional investments.

Great. And then, I had another question on the pediatric software approval and your limited launch of that this year. Is there any contribution, from that, factored into the current guidance for 2025? And how should we think about the incremental revenues, potentially, just in light of the TAM expansion, over the long term?

Thanks.

Thank you for the question. The short answer: in 2025, the pediatric Clarity will not have an impact on the 2025 guidance. However, as we talked about earlier, we do see a meaningful expansion there, both in children's hospital, as well as pediatric population in the emergency department.

After we finish our limited commercial release, which will be about a year frame, we will do a full launch. And, with the full launch, we will start to anticipate additional revenue in the outer years.

Margaret Andrew, William Blair.

Hi. Good afternoon, folks. Thanks for taking the question.

Maybe, I wanted to start with guidance first. Scott, your math tracks, at least with our model. Maybe, we don't have a specific utilization rate but, at least, based on our model and some reasonable assumptions, if we keep utilization flat versus with what happened, maybe, in the first quarter for the rest of the year, it gets us to that high end or, maybe, even above the high end of your revenue guidance range.

And that doesn't even account for the nice number in Clarity, where those metrics looked really nice versus our model, as well.

So two questions around that. One, is my math right? And why should or shouldn't utilization rates grow above this quarter's specific rate?

And then, two, what seasonality should we expect going into Q2 and throughout 2025? Do you think that the sell-side numbers, maybe, for Q2 prior, going into this quarter, should go up? Or are they pretty -- should stay where they are?

Thanks.

Yeah. I think, as it relates to seasonality, let me get to the reason behind that, which is really having to do with ICU census.

In the winter months, there's higher ICU census, given respiratory illness. And so, we've historically seen an increase in usage in Q4 and Q1. And, of course, we're just coming out of that.

So we did have a pretty high Q1. Last year, Q1 to Q2, we saw a slight sequential decline in usage. It's a little bit hard to truly isolate the impact from the CAM strategies, which we're very confident are driving usage from seasonality.

But we do expect that seasonality did drive some of that number in Q1. So I wouldn't be surprised if in the near-term quarters, you might see that number potentially go down from where it was in Q1 temporarily, as a result of seasonality.

But, ultimately, over the long term, we have a very high degree of confidence that our strategy is working.

It's important to note that we still feel that we're somewhere in the neighborhood of 20% to 30% penetrated within our established account base. So we have a lot of room to keep growing and driving utilization.

Okay. And so, maybe, utilization dips down a little bit, comes back up in Q4. But, directionally, it seems like the CAM strategy is paying off. And so, the prior number, at least relative to this one, we had utilization down 8% sequentially into Q2.

Is that too aggressive? Is that about right, relative to maybe, the ED visits that you're seeing?

I won't comment on individual models. I would say that sequentially, Q2 over Q1, as we continue growing the business, right, throughout the history of the business, we've had sequential increases quarter over quarter.

But, as we grow, the number of accounts we're adding, relative to the total account base, gets less and less. So we get less impact from new account adds.

Over time, I would expect for the seasonality, as it relates to Q1 to Q2, to increase in terms of how visible it is in the numbers.

So Q2 to Q1, I would expect a much more modest increase, if any, than we saw Q4 to Q1, as a result of that seasonality.

Okay. Super helpful. And then, maybe, just to walk through some of these CAM investments because, again, it does seem to be paying off in higher utilization.

Can you give us some context over some of the initiatives that are playing out? Not that you're hiring people. But they're doing something in the field.

So what are they doing? How broadly are some of those initiatives playing out, at this point? And how should that play out, as we look out through '25 and '26?

Thank you.

Yeah. We focus on a few different dimensions in driving utilization with our CAM team.

The first area we focus on is to raise the disease awareness and especially leveraging existing guideline. For example, American Heart Association has a Level 1 recommendation of using EEG promptly after cardiac arrest patient -- after initial survival.

Despite the Level 1 recommendation starting in 2020, many hospitals still were not aware of this guideline. So our CAM team often go in and partner with the nursing and physician team to develop more standardized protocol so proper care can be delivered.

The second dimension we focus on is, in general, the physician education, as well. Post-pandemic, there's still a lot of turnover, both at physician level, as well as nursing level. So our team will go in and re-educate not just how to apply the device but latest (inaudible) guideline and some of the disease state education.

The third area we focus on is departmental expansion. In many of our accounts, we're not fully penetrated. We're not in all the ICU, the floor, and emergency department yet. So that's another third area we focus on.

Josh Jennings, TD Cowen.

Hi. Good afternoon. Great start to the year.

I wanted to just build on your last answer, Jane, and just trying to think about the opportunities in the customer base to expand in departments -- as you said: ICU, floor, ER. Any quantification, in terms of the opportunity for that expansion within your customer base?

And then, also, our check suggests that you guys, have been effective at landing an account at the mothership in a hospital network and then, expanding out into the satellites. Maybe, just talk about the opportunity within your customer base there, as well.

Sorry for the two-tiered question.

Yeah. Thank you, Josh.

For the first question, we stated that we estimate we are currently in 3% of the US market for seizure. And the math there is we are 10% penetrated in the hospital number, roughly. And for the accounts we are in, we estimate that we are in about -- we are serving about 30% -- 20% to 30% of the patients for the hospitals we are in.

So that goes back to the drivers I mentioned earlier: we are not serving all the patients; we are not serving all the departments. So there's about 70% opportunity, just within the accounts we are in.

For your second question: we do see a large synergy across different hospitals -- especially, similar to tele stroke -- this hub-and-spoke model that works very well. In the spoke satellite hospitals, they tend to have even bigger gap in conventional EEG. Often, it's Monday to Friday, 9 to 5; or not have EEG, at all.

So our strategy there is, really, to leverage their own health economics data, their own impactful patient studies to further drive that. It's a strategy we have been applying for the past few years.

And, as Scott mentioned, we are trying different investment opportunities on the commercialization front. One area we are investing in is to build up the hospital healthcare-system team. And that team can further drive the strategy.

Excellent. And I wanted to just also learn about -- sorry to ask you to help us with this -- but just in terms of the competitive landscape, are you seeing any -- is there anything on your radar?

We don't believe you're seeing anything in the field. And, again, our check suggests that there's competitive systems that are not rising to the level of CeriBell.

But, maybe, just help us understand what you're seeing, competitively, out in the marketplace.

Thanks for taking the questions.

Yeah. It's very much aligned with what you stated, Josh. We have seen some emerging competitors trying to enter the category we have created, which is a point-of-care EEG. And we remain the clear category leader.

And, also, we are highly confident we'll keep this leadership position with our technology; both hardware and algorithm, that's unmatched; also, our clinical evidence and our patents.

We also want to remind everyone that we are only in 3% US market. As Scott already mentioned, we are raising our revenue guidance in 2025. And that also implies that we are not seeing meaningful difference on the competitive front.

Thank you.

Jon Young, Canaccord.

Hi, Jane and Scott. It's Jon, on for Bill, tonight. Thanks for taking my questions. Congratulations on the quarter.

I wanted just to talk about pricing. What pricing is factored into your gross margin comments, Scott, that you mentioned on the call? And can you just talk broadly about your ability to raise prices in this tough macro environment? How receptive are hospitals to that?

And I have a follow-up. Thank you.

The comments I gave, as it relates to our margins, has no change in pricing policy. We've continued to make appropriate but not egregious increases in pricing to our customers. And we've continued to deliver value to them, both as a cost saver and revenue generator.

So customers have been receptive to that.

We have not contemplated or our guidance does not contemplate any change in strategy, such as tariff-based price increases. But, of course, that's something we may look at -- but not included in those numbers.

Great. Thanks. And, if you did have to raise prices, based on tariffs, how quickly could you do that? Are these annualized contracts? Or could you do it pretty immediately?

Generally speaking, contracts are a year; sometimes, two years. But they expire on a rolling basis.

There's not a set time at which they expire. So we would -- generally, our pricing increases or changes have to do with the individual customers' contract life cycle, which is spread throughout the year.

Great. Thanks for that one, Scott.

Jeffrey Cohen, Ladenburg Thalmann.

Hi, Jane and Scott. Thanks for taking our questions. One shorter one, one longer one.

Firstly, could you comment on pediatric Clarity, as far as number of SKUs; and if the actual headband itself and its manufacturers (inaudible) same process, same unit, and same number of leads?

Just to make sure I understand the question: it's is the pediatric Clarity, in terms of whether or not it's additional product -- in terms of SKU?

Yeah. Are there different sizes available, as far as the headband? And is the unit, itself, as far as the leads, the same as adult -- the hardware portion?

Yeah. Our hardware has already been approved, cleared by FDA for all ages. So there's already different sizes of headband using the existing product.

Even before this pediatric Clarity, we actually have pediatric patients using CeriBell system. They just (inaudible) not used Clarity. They only used the hardware as the base version.

So with Clarity pediatric, this would not be an independent product. This is more likely, say, when we go back to the existing base account, if they have a PICU -- pediatric ICU -- and they all have pediatric population in their emergency department, we would expand Clarity usage from adult to pediatric.

Got it. That's helpful.

And then, secondly, you touched on it a little bit but I'm curious if you could expand upon and talk about the internal permeation at a facility, whether pulled or pushed from the ICU toward the ER or vice versa? What are you seeing, as far as practice that's going on now; as far the ER departments coming up to speed, beyond the traditional penetration in ICU and CCU?

Yeah. The clinical context of your question, let me lay that out first.

Before CeriBell, many ICUs have some level of access of EEG. But, by contrast, majority of emergency department almost never use EEG because the conventional EEG can take hours or even days, it does not work with the timeframe that ED operates on, with often minutes or hours.

Therefore, our initial entrance to the hospital, often, is the ICU because they have used conventional EEG before and it's more a tool that clear-see expansion and advantage over conventional EEG.

With that success, we start to introduce EEG to the emergency department a few years back. And that has been very successful.

Within the hospital clinical setting, often, the ICU would support or even recommend our product to the emergency department. And the reason is that, quite often, patients could be empirically treated in the ED, without EEG, so that patient could be intubated with the suspicion of seizure without confirmed EEG.

This patient will be sent to the ICU. And that could lead to ICU bed, unnecessary ICU length of stay, which is also reflected in our clinical study.

It's one of the drivers we could reduce length of stay. Therefore, we can really cover the hospital -- entire patient workflow, starting from ED all the way to ICU.

So your sense of the awareness in ER is coming well, both from the company and your clinical organization, capital organization; as well as, internally, from the ICU departments? But, case by case, I imagine?

That's correct.

Perfect. Thanks for taking my questions.

Thank you, Jeff.

There are no further questions, at this time.

I'll turn the call back over to Jane Chao, Co-Founder and CEO.

Thank you. Thank you, everyone, for joining the call.

We very much appreciate your interest in CeriBell. Again, we are very excited and pleased about our first quarter and look forward to continuing sharing our future quarters with you all.

This concludes the meeting. You may now disconnect.