Nano-X (NNOX) Q2 2025: 20+ Active Systems Drive U.S. Imaging Revenue Expansion
Nano-X’s commercial ramp accelerated in Q2, with over 20 NanoX Arc systems now scanning patients and a robust pipeline supporting its 100-unit year-end target. The company’s hybrid CapEx and subscription model is gaining traction, especially in the U.S., while AI partnerships and clinical validation efforts are broadening market reach. Management expects revenue inflection in the second half as deployments scale and new channels activate.
Summary
- Commercial Pipeline Momentum: U.S. installations and qualified leads surged, underpinned by distributor partnerships and direct sales.
- AI and Clinical Validation: Strategic collaborations and academic studies are strengthening Nano-X’s value proposition and supporting adoption.
- Second-Half Revenue Inflection: Management expects deployments and new customer activity to drive meaningful revenue growth through year-end.
Performance Analysis
Nano-X delivered revenue growth in Q2, driven by increased teleradiology services and early imaging system sales, though gross loss widened modestly as the company scaled commercial operations. Teleradiology, which provides remote reading of medical images, accounted for the majority of revenue and continued to show improved customer retention and higher service rates, with gross profit margins rising to 18 percent on a GAAP basis. Imaging system revenue reached $221,000, supported by more than 20 NanoX Arc units actively scanning patients, representing a step-change in operational momentum.
AI solutions revenue remained nascent but showed early signs of growth via new partnerships and expanding installations, though profitability is not expected until 2026. Operating expenses held steady, reflecting management’s commitment to cost discipline even as sales and marketing investments increased to support the U.S. commercial launch. The balance sheet remains solid with over $62 million in cash and equivalents, providing runway for continued deployment and product development.
- Imaging System Ramp: Over 20 systems active, up from prior periods, fueling initial imaging-related revenue.
- Teleradiology Margin Expansion: Gross profit margin improved on higher volume and retention, supporting the core services business.
- Operational Efficiency: OPEX remained stable, offsetting increased sales and marketing outlays with reductions in legal and administrative costs.
Management reiterated its expectation for accelerating revenue in the back half of 2025, as a growing pipeline of installations and AI deployments moves toward full-scale commercial impact.
Executive Commentary
"Expanding our commercial footprint remains a top priority, and our sales team continues to expand the pipeline of qualified leads and successfully convert those leads into systems being shipped to customers... We are well on our way to meeting our target of 100 systems installed or being deployed by year's end."
Erez Meltzer, Chief Executive Officer and Acting Chairman
"All in all, it's a tradeoff. Once we increase in one place, we do decrease in one place, and we're trying to maintain the same level of expenses. And as we have said before... when you're going to see the revenue alleviating, then you should see a decrease in the operating loss and the burn and et cetera."
Ron Daniel, Chief Financial Officer
Strategic Positioning
1. U.S. Market Penetration and Sales Model Evolution
Nano-X is executing a dual-channel approach in the U.S., combining direct sales with distributor partnerships (ASI and Swiss Ray) and targeting both CapEx (capital equipment sales) and MSaaS (Managed Service as a Subscription, pay-per-scan or rental) models. This hybrid model is designed to maximize addressable market and accommodate diverse customer preferences, with CapEx favored in Europe and a mix in the U.S. The company is now approved in eight U.S. states, a meaningful regulatory milestone for scaling installations.
2. Clinical and Academic Validation as Adoption Catalysts
Clinical validation is central to Nano-X’s go-to-market strategy, with collaborations at Duke University and Kaiser University generating peer-reviewed evidence and immersive training for radiology professionals. These partnerships are designed to build credibility, drive awareness, and accelerate adoption by demonstrating the diagnostic value and workflow integration of NanoX Arc systems, particularly in orthopedics and lung cancer screening.
3. AI Ecosystem Expansion
AI solutions are gaining traction through integration with leading platforms, such as DeepSeaOS and Ezra, as well as new pilots in India and expanded U.S. B2B2C deployments. Management expects AI revenue to become more predictable and material in 2026, as annual payment models and broader platform integration drive scale. Collaborations targeting NIH grants and population health studies further position Nano-X as a differentiated player in AI-powered imaging.
4. Manufacturing and Supply Chain Scale-Up
To support anticipated growth, Nano-X finalized a multi-year manufacturing agreement with FabriNet, a global electronics manufacturing services provider. This partnership is expected to lower costs, ensure regulatory compliance, and provide scalable production capacity for both current and future imaging system variants.
5. International Expansion and Regulatory Progress
Following CE mark approval, Nano-X is accelerating its European rollout, with Romania and Greece among the first targets for distributor-led deployments. Latin America and select Asia-Pacific markets (notably India and Thailand) are in early-stage pilot or regulatory phases, while the U.S. remains the primary near-term growth engine.
Key Considerations
Nano-X’s Q2 results highlight a company transitioning from R&D and regulatory groundwork to commercial execution, with a clear focus on scaling both hardware and AI service lines. The following considerations frame the strategic context for investors:
Key Considerations:
- Pipeline Visibility: Management claims all 100 targeted year-end deployments are identified, with installation schedules mapped and deal flow accelerating.
- Hybrid Revenue Model: The mix of CapEx and MSaaS models enables flexibility across geographies and customer segments, but also introduces revenue recognition complexity and forecasting variability.
- AI Monetization Trajectory: AI business is expected to reach breakeven in 2026, with current volatility in reported revenue due to annual payment structures and revenue recognition timing.
- Operational Leverage: Stable OPEX points to discipline, but further margin improvement will depend on scaling deployments and achieving manufacturing efficiencies.
- Clinical Education and KOL Engagement: Ongoing investment in clinical education and key opinion leader networks is critical for driving behavior change and adoption in a conservative industry.
Risks
Key risks for Nano-X include execution risk in scaling system deployments, especially given the conservative adoption cycles in medical imaging and the need for continued clinical validation. Regulatory hurdles in new markets and evolving reimbursement environments could impact the pace of commercialization. Additionally, the company’s hybrid revenue model introduces forecasting complexity, while AI monetization is still dependent on broader platform adoption and integration. Investors should monitor the pace of new installations, customer utilization rates, and the conversion of pipeline leads into recurring revenue.
Forward Outlook
For Q3 2025, Nano-X guided to:
- Continued acceleration in NanoX Arc installations, with more than 20 systems already scanning and additional deployments scheduled.
- Revenue growth driven by both U.S. and European market expansion and increased AI solution adoption.
For full-year 2025, management reiterated:
- Target of 100 NanoX Arc systems deployed or in process by year-end.
- Second-half revenue inflection as commercial pipeline converts and AI partnerships scale.
Management highlighted several factors that will drive growth:
- Robust qualified lead pipeline and expanded distributor network in the U.S. and EU.
- Ongoing clinical validation and academic collaborations to support adoption and reimbursement discussions.
Takeaways
Nano-X’s Q2 marks a turning point as the company shifts from validation to commercial scaling, with tangible progress in U.S. installations, AI partnerships, and manufacturing readiness.
- Commercial Execution: The company’s ability to deploy over 20 active systems and map out its 100-unit target underpins management’s confidence in second-half revenue growth.
- Strategic Partnerships: AI integration with major platforms and academic validation are key differentiators, supporting both product adoption and long-term monetization potential.
- Future Watchpoints: Investors should track the conversion of the pipeline into recurring revenue, the pace of international expansion, and evidence of operating leverage as deployments scale.
Conclusion
Nano-X’s Q2 2025 results signal a meaningful shift toward commercial scaling, as operational execution and strategic partnerships begin to translate into revenue momentum. The company’s multi-pronged approach—spanning hardware, AI, and clinical validation—positions it for accelerated growth, though execution and adoption risks remain as the business model matures.
Industry Read-Through
Nano-X’s progress highlights growing demand for accessible, lower-cost 3D imaging solutions and the increasing importance of AI-driven workflow enhancements in radiology. The company’s hybrid revenue model and focus on clinical validation reflect broader industry trends, as imaging OEMs and digital health startups alike seek to balance capital sales with recurring service revenue and evidence-based adoption. The traction in distributor partnerships and academic collaborations underscores the need for ecosystem engagement in overcoming adoption barriers. For the medical imaging sector, Nano-X’s evolution from R&D to commercial execution is an indicator of the sector’s readiness for innovation, but also a reminder of the long adoption cycles and regulatory hurdles that shape medtech growth trajectories.