On Tuesday, Cantor Fitzgerald adjusted its price target for Nano-X Imaging (NASDAQ:NNOX), reducing it to $11 from the previous $14, while sustaining an Overweight rating on the stock. The adjustment follows Nano-X's third-quarter financial report, which revealed revenues of $3.0 million, falling short of both Cantor's $3.3 million and FactSet consensus estimates of $3.9 million. Despite this, the company saw a year-over-year revenue increase of approximately 32%.
The revenue for the quarter was primarily driven by Nano-X's teleradiology services, which saw an 18% year-over-year increase to $2.6 million. Additionally, the company's artificial intelligence solutions grew significantly, by about 184% year-over-year to $0.4 million.
Nano-X also generated income from the sales and deployment of its imaging systems, which contributed $29 thousand to the quarter's revenue. This was attributed to the deployment of ARC systems in the United States and 2D systems in Africa.
During the earnings call, Nano-X highlighted that it currently has around 47 imaging systems in the United States in various stages of deployment. Moreover, the company has a substantial backlog, with approximately 200 systems awaiting deployment.
The firm remains optimistic about Nano-X's growth prospects, citing the ongoing U.S. deployments and the potential for a broader application of its technology for general scans. This could significantly expand the company's market opportunity.
In addition, Nano-X is developing a next-generation device, which is anticipated to further contribute to its growth trajectory. The Overweight rating reaffirmed by Cantor Fitzgerald reflects the firm's confidence in the long-term potential of Nano-X Imaging, despite the recent adjustments to the company's short-term financial expectations.
In other recent news, Nanox Imaging Limited reported its Q3 2024 financial results, showing both progress and growth. The company's earnings revealed a GAAP net loss of $13.6 million, but this was offset by an increase in revenue, particularly from its AI solutions segment. Nanox also highlighted the successful deployment of 47 Nanox ARC systems across seven U.S. states, contributing to advancements in medical imaging technology.
The financial report showed a total revenue of $3 million for the quarter, with teleradiology services contributing $2.6 million and AI solutions revenue growing to $400,000. Despite the net loss, the company's cash position remains robust with $57.1 million in cash and equivalents.
Among the recent developments, Nanox is expecting to hit important milestones in 2025, including chest and full-body indication approvals, CE Mark, and the ArQX launch. The company's AI solutions segment showed a significant year-over-year revenue increase, and new FDA 510(k) clearance for its AI Health CCNG Version 2.0 has been secured.
CEO Erez Meltzer emphasized the strategic importance of the U.S. market and the company's efforts to advance commercialization globally. He also pointed out multiple upcoming milestones that have the potential to be significant for the company.
InvestingPro Insights
Recent data from InvestingPro sheds additional light on Nano-X Imaging's financial position and market performance. Despite the revenue shortfall noted in the article, the company has shown a significant return over the last week, with its stock price increasing by 13.88%. This recent uptick may reflect investor optimism about the company's long-term prospects, aligning with Cantor Fitzgerald's maintained Overweight rating.
However, InvestingPro Tips highlight some challenges facing Nano-X. The company suffers from weak gross profit margins, which is evident in the reported -88.34% gross profit margin for the last twelve months. This aligns with the article's focus on revenue growth but underscores the need for improved profitability.
On a positive note, Nano-X holds more cash than debt on its balance sheet, with liquid assets exceeding short-term obligations. This financial stability could be crucial as the company continues to deploy its imaging systems and develop next-generation devices.
For investors seeking a more comprehensive analysis, InvestingPro offers 5 additional tips for Nano-X Imaging, providing a deeper understanding of the company's financial health and market position.
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