Ceribell, Inc. Q3 FY2026 earnings call

• Core Seizure Business Growth: The core seizure business remains a durable growth engine, with the active account base increasing by a record 35 hospitals to 747 total accounts. Headband utilization hit a new record, with year-over-year usage per account growing at a double-digit rate.
• Delirium Monitoring Launch: The company launched its delirium monitoring solution via a successful commercial pilot. The strategy involves offering it as a free software upgrade to existing customers in exchange for program commitments (e.g., training >80% of staff) rather than incremental subscription fees. Clinical utility is driving increased headband utilization.
• Omni Platform Unveiled: Management unveiled 'Omni,' a new hardware platform integrating video, continuous monitoring, EKG compatibility, and parasitical add-ons. It supports eight FDA-cleared algorithms for seizure, status epilepticus, delirium, and other brain stress indicators. Limited market release began in Q3 2026, with a full launch expected in 2027.
• Algorithm Enhancements: New FDA 510(k)-cleared algorithms for quantitative EEG trending and amplitude-integrated EEG analysis are scheduled for cloud-based release next year, enhancing clinical insights for bedside users and neurologists.
• Strategic Initiatives: Progress includes a strategic account management team targeting regional health systems, strong engagement with VA and DOD health systems (including a commitment for expansion), and ongoing pipeline development for Neonate products.

The company reported total revenue of $29.3 million for the third quarter of 2026, representing approximately 30% year-over-year growth and a 4% sequential increase. This performance was driven by two primary segments: Products revenue reached $22.2 million (an increase of 31% from $17.0 million in Q3 2025), while Subscription revenue totaled $7.1 million (an increase of 28% from $5.6 million in Q3 2025). The firm maintains high gross margins, with Q3 2026 gross margin at 90% compared to 88% in the prior year period.

• Full-year 2026 revenue guidance raised to $115–$117 million (previously $114–$117 million), reflecting 29–31% annual growth over 2025.
• The revised guidance reflects momentum in the core business but explicitly excludes material contributions from neonate, pediatric, or delirium products, which are expected to contribute meaningfully in 2027.
• Gross margins are expected to remain in the high 80% range going forward, supported by current inventory positions and tariff policies.

• IP Litigation Costs: General and administrative expenses included $1.1 million related to ongoing IP litigation. There is potential exposure to pay $2.9 million in Elliman and Clinical Studies.
• Execution Complexity: Implementing disruptive technology like delirium monitoring requires significant operational effort, including staff training and workflow alignment, which may slow broad-scale conversion despite clinical utility.
• Forward-Looking Statement Risks: As with all earnings calls, actual results may differ from projections due to material risks and uncertainties outlined in SEC filings, including Form 10-K and 10-Q.

Q: Gracia Mahoney asked about the offset between product and subscription revenue strength and how algorithm updates might factor into the outlook.

A: Scott Blumberg noted that product margins showed significant strength. He emphasized that while purchase volumes varied slightly relative to usage, utilization remains the core metric where record highs were achieved, and the company is focused on long-term usage trends over short-term purchase fluctuations.

Q: Robbie Marcus inquired about the commercial strategy for Delirium, specifically regarding new vs. deepening accounts and OpEx implications for the launch.

A: Jane Chao explained that Delirium will drive both utilization and new account acquisition. In the near term, utilization growth from existing accounts is key, but long-term new accounts will likely launch with both seizure and Delirium enabled. OpEx leverage is high because the existing sales team (CAMs and TMs) will handle the launch, leveraging established relationships without needing new infrastructure.

Q: Brandon Vasquez asked for clarification on the 'same store' utilization metric definition and the drivers behind the record double-digit growth.

A: Jane Chao attributed the growth to continuous execution of a three-part playbook: departmental expansion (ICU/ED), physician engagement, and protocolization. Scott Blumberg defined the metric as precise cloud-enabled device usage data used to incentivize teams. He noted that department expansion creates durable, sustainable revenue capture as different departments are onboarded throughout the year.

Q: Jason Bedford asked if Delirium pilot utilization increases were isolated to Delirium or if they pulled through to higher Seizure usage, and if there were minimum volume commitments.

A: Jane Chao stated that clinically, it is difficult to separate the two as patients often present with both; the joint monitoring drives patient expansion (e.g., sepsis patients) and increases face time with clinicians, boosting awareness for both conditions. Scott Blumberg confirmed there are no contractual volume obligations, but the consistent usage patterns in the pilot give high conviction that following the recommended workflows will yield similar results.

Q: Josh Jennings asked about VA account additions and utilization growth expectations for 2027.

A: Scott Blumberg clarified that a commitment secured late last fiscal year aligns with prior year volumes and will roll into the account base over the next 2-3 quarters. Jane Chao added that while top-down VA launches initially show lower-than-average usage, utilization grows as experience is gained, and the company is confident in driving sustainable usage across these accounts.