LUNG — Pulmonx Corporation

Pulmonx Q1 2026 Earnings Call Summary

1. Key Financial Results and Metrics

• Total Revenue: $20.6 million, down 9% year-over-year from $22.5 million.
• U.S. Revenue: $13.3 million, a 7% decline from $14.2 million in Q1 2025.
• International Revenue: $7.3 million, a 12% decrease from $8.3 million, primarily due to the absence of sales to a distributor in China.
• Gross Margin: 78%, up from 73% in the prior year, attributed to a lower mix of distributor sales.
• Operating Expenses: $29 million, down 6% year-over-year. Excluding one-time restructuring costs, operating expenses decreased 8%.
• Net Loss: $13.7 million, or $0.33 per share, an improvement from a loss of $14.4 million or $0.36 per share in Q1 2025.
• Cash Position: $61.6 million at the end of Q1 2026, down $8.2 million from the previous quarter.

2. Strategic Updates and Business Highlights

• Sales Team Revamp: The company has filled all sales leadership positions and most U.S. field sales roles, stabilizing sales turnover and improving team culture.
• Focus Areas: Pulmonx is concentrating on:
  • Reaccelerating U.S. sales growth.
  • Advancing the AeriSeal clinical program to expand the addressable market.
  • Aligning cost structure to drive profitability.
• New Treating Centers: 15 new U.S. treating centers were added in Q1, indicating progress in expanding market presence.
• Clinical Initiatives: The CONVERT II pivotal trial for AeriSeal is progressing well, with expectations to complete enrollment by 2027.

3. Forward Guidance and Outlook

• 2026 Revenue Guidance: Reiterated guidance of $90 million to $92 million, with expectations for sequential quarterly improvement and a return to year-over-year growth in the latter half of the year.
• Operating Expenses: Expected to be between $113 million and $115 million for the full year, including approximately $19 million in noncash stock-based compensation.
• Cash Burn: Projected to be around $23 million for 2026, a decrease from $32 million in 2025.

4. Bad News, Challenges, or Points of Concern

• Revenue Decline: Notable declines in both U.S. and international revenues, primarily due to the lack of sales in China and previous operational challenges.
• China Market: The company is awaiting the renewal of its registration certificate in China, which is expected in the second half of 2026. This absence of sales is impacting international revenue growth.
• Transition Year: 2026 is characterized as a year of execution and transition, with prior underperformance being a concern.

5. Notable Q&A Insights

• Sales Strategy: Management emphasized a focused approach to sales, narrowing priorities to improve efficiency and productivity.
• Account Additions: The pace of new account additions is expected to stabilize around 10 per quarter, with a focus on high-quality accounts.
• Long-term Growth Aspirations: Management expressed confidence in returning to double-digit growth, particularly in international markets, but refrained from providing specific long-term growth targets beyond 2026.
• LungTraX Program: The program is being refocused to target specific accounts where it has shown effectiveness, rather than a broad application.

Overall, Pulmonx is navigating a challenging environment but is taking steps to stabilize its operations and position itself for future growth, particularly through strategic hiring and focused clinical initiatives.