Nyxoah SA Ordinary Shares 2026 Q2 Earnings Call

Good afternoon, everyone. I welcome you to our second quarter 2026 earnings call. Participating from the company today will be Olivier Taelman, Chief Executive Officer, and John Landry, Chief Financial Officer. During the call, we will discuss our operating activities and review our second quarter 2026 financial results released after U.S. market closing today, after which we will host a question-and-answer session. The press release can be found on the investor relations section of our website. This call is being recorded and will be archived in the events section on the investor relations tab of our website. Before we begin, I'd like to remind you that any statements that relate to expectations or predictions of future events, market trends, results, or performance are forward-looking statements. All forward-looking statements are based upon our current estimates and various assumptions.

These forward-looking 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. All forward-looking statements are based upon current available information. The company assumes no obligation to update these statements. Accordingly, you should not place undue reliance on these forward-looking statements. For a list and description of the risks and uncertainties associated with our business, please refer to the Risk Factors section of our Form 20-F, which was filed with the Securities and Exchange Commission on March 26th, 2026. With that, I will now turn the call over to Olivier.

Thank you, Pearson. Good day, everyone. Thank you for joining us for the second quarter 2026 earnings call. Let me start with Q2 highlights. Q2 was a strong quarter for Nyxoah across multiple fronts. I'm pleased with the progress we are making in the business. First, the strong commercial execution of our U.S. launch delivered a second consecutive quarter of more than 20% sequential U.S. revenue growth. U.S. net revenue was EUR 5.2 million, up 22% over the first quarter of 2026. We also posted another strong quarter of revenue growth in our international business, up 19% over the first quarter of 2026. On a worldwide basis, net revenue was EUR 7.7 million in the second quarter, representing 21% sequential growth over the first quarter. Second, before doing a deeper dive on the U.S. commercialization results, let me provide our high-level leading U.S. commercial indicators.

Our U.S. leading commercial indicators continued to strengthen across the board. Entering quarter two with 40 fully trained sales reps, we can cover 200 of the top 400 high-volume hypoglossal nerve stimulation accounts in the U.S. We have trained 55 new surgeons and activated 89 new accounts in this quarter, doubling our active account base to 180. We entered the third quarter with 427 patients actively under prior authorization, a 77% increase over the prior quarter. Our prior authorization approval rate remains at 100% for both commercial payers and patients submitted via the WISeR program. On the reimbursement front, CMS announced meaningful proposed increases for AGNS overall, including Genio specifically. CMS-proposed facility reimbursement would increase OPPS facility payment by 12% and ASC, ambulatory surgical centers, by 15% for 2027. These increases would further strengthen the economic value of the Genio procedure for the facilities.

From a financing perspective, we significantly strengthened our balance sheet by securing $110 million during the quarter, taking away the financial overhang. This new capital will provide us with the resources needed to further accelerate Genio U.S. commercialization ramp and implement the growth initiatives focused on increasing the patient funnel. Digging in deeper into the U.S. commercialization. The U.S. commercial launch remains the primary driver of our long-term company success. Our U.S.-focused strategy remains unchanged and centered on driving strong Genio adoption in the top 400 high-volume AGNS accounts, which represent approximately 70% of the total U.S. AGNS volume. We hired and trained 50 new sales reps in the first quarter, bringing us to 40 sales territories as of April 1st. Entering Q2, we have access to 200 of the top 400 high-volume AGNS accounts.

Specifically, we trained 55 new surgeons in Q2, bringing the total to 262 surgeons trained on the Genio system. We activated 89 new accounts in Q2, roughly doubling our active account base, bringing the total to 180 active high-volume AGNS accounts. Finally, we had 427 patients actively under prior authorization submissions entering the third quarter of 2026. This is a 77% increase over the previous quarter. Doubling our active account base to 180 high-volume AGNS accounts in a single quarter demonstrates that both facilities and physicians are embracing Genio and confirms success of our patient referral pathway by sleep physicians. With 427 patients actively under prior authorization exiting Q2, this gives us first-hand confirmation of increased patient demand and is a key leading indicator for Q3 of the acceleration of our patient pipeline, giving us confidence in continued launch momentum entering Q3. Next, reimbursement. There is now full clarity for Genio reimbursement with the dedicated Medicare C code C8011 for Genio.

Our commercial payer coverage remains broad and stable using existing CPT codes. Our market access team continues to execute strong on supporting prior authorization submissions. Through our Genio access program, we continue to see 100% approval rates of commercial payers, Medicare Advantage, and Medicare patients under the WISeR program. Commercial payers are still the majority of our business, making up approximately 85% of it. The recent direction of CMS proposed rule for 2027 AGNS reimbursement would positively impact the clinical and economic value of the Genio procedure in OPPS and ASCs. Specifically, CMS is proposing to increase hospital outpatient reimbursement for the Genio procedure under C code C8011 from $31,526 to $35,414, or an increase of approximately 12%.

CMS is also proposing to increase ambulatory surgical centers, the ASCs, reimbursement from $27,563 to $31,722, or an increase of approximately 15%. These proposed increases are amongst the strongest within APC 5465, the level 5 neuromodulation category. Finally, in the upcoming September CPT Editorial Panel meeting, AAO-HNS, supported by Nyxoah as an industry member, will continue the discussion of a comprehensive AGNS coding. As a consequence, Nyxoah did not submit Genio for a dedicated category 1 CPT code on the September CPT Editorial Panel meeting agenda. Let me now focus a little bit more on our recent Investor Day. On July 8th, we had the pleasure of hosting our Investor Day, where we focused on bringing together leading ENT surgeons and sleep physicians alongside independent reimbursement experts. The surgeons shared their first-hand implant experience with Genio, and both surgeons and sleep physicians confirmed strong airway openings on activation.

These real-time experiences are the key drivers behind Genio's adoption in their practice. The reimbursement experts presented their view of the AGNS reimbursement landscape, confirming the durability of long-term coverage and Genio's strong positioning under every future coding scenario. The event reinforced the two pillars of our U.S. launch, growing physician adoption and a solid reimbursement foundation. For those who missed it, the replay is available on our investor relations website. International. Before turning to the financial, let's look at the international markets. We accelerated revenue in the second quarter, resulting in a 19% growth quarter-over-quarter. Overall, in the first half of 2026, we almost doubled our international revenue versus the first half of 2025, driven by our focused commercial approach in target geographies.

In Germany specifically, as the largest AGNS market outside the U.S., we first entered this market back in 2023 as our commercial proof of concept, resulting today in a stable AGNS market share of up to 25% overall, with a market share in our top high-volume accounts of above 50%. In the U.K., we entered the market at the same time as competition in late 2024, and in our initial accounts, we are seeing market shares above 50% as well. In the Middle East, Nyxoah is the sole AGNS provider, and we continue to further expand. We recently entered the market in the Netherlands. Our strategy remains unchanged. Exercise financial discipline in these markets with a goal of driving growth and breaking even in our international business, which we've been able to do already in Germany.

With that, I will now turn the call over to John for a detailed overview of our financial results.

Thank you, Olivier. For the second quarter of 2026, worldwide net revenue was EUR 7.7 million, which represents 21% sequential growth compared to the first quarter of 2026 and compares to EUR 1.3 million in net revenue in the second quarter of 2025. U.S. net revenue was EUR 5.2 million, representing 22% sequential growth over the first quarter of 2026. International net revenue was EUR 2.5 million, representing 19% sequential growth over the first quarter of 2026. For the six months ended June 30, 2026, worldwide net revenue was EUR 14 million compared to EUR 2.4 million for the six months ended June 30, 2025, an almost six-fold year-over-year increase, primarily driven by our U.S. commercial launch. Gross margin in the second quarter of 2026 was 60%, compared to 57% in the first quarter of 2026.

Research and development expenses were EUR 9.5 million in the second quarter of 2026 compared to EUR 10.1 million in the second quarter of 2025, due to a decrease in product development expenses. SGA expenses were EUR 15.6 million in the second quarter of 2026 compared to EUR 10.7 million in the second quarter of 2025. This increase was primarily driven by the continued build-out of our U.S. commercial organization. Total operating loss for the second quarter of 2026 was EUR 20.6 million and remained relatively flat compared to EUR 19.9 million in the second quarter of 2025. Please note that our operating expenses in the second quarter of 2026 included a one-time non-cash share-based compensation charge of approximately EUR 900,000 due to the repricing of employee equity incentive awards. Non-GAAP cash operating expenses were EUR 21.8 million, or essentially flat compared to EUR 21.7 million in the first quarter of 2026.