Dan Shea: Yes, I think you’re right to point out the persistency of the service revenue. That’s a known, and you know I think that when we thought of the furlough decisions, I think that was a big factor in determining you know who would get furloughed and who wouldn’t get furloughed. I think right now there’s a workforce that’s there, that’s covering manufacturing field service, sort of assembling source x-rays and you know filling orders for all kinds of sort of disposables. On the product side, I think back to the discussion just earlier, I think the €“ you know the go-to-market approach with Xoft is at least partially done through our partners, and so you know there is €“ like we said, there is a bit of a, sort of a low now because of the furlough, but I think the controllers, we’re still getting controllers in.
We have an order, a supply chain that’s delivering enough to have them available to be purchased and in particular you know in the €“ outside the U.S. market there’s some strong partners who are in a position to make orders. That I think, yes, I think it’s a good question on the product side. I think you’re also right to highlight the persistency of the service revenue.
Marie Thibault: Sure. Okay, that’s helpful, thank you for that. I guess you know to sort of highlight one other thing that you mentioned today that’s new to us is the profitability timelines, very encouraging to hear. What are you assuming in that? Are you assuming that you know there is a strategic option from the Xoft? Are you assuming some sort of growth on the top line? And as part of that question, I guess if you could refresh us on what margins look like for the detection business, that would help us as we plot out getting to profitability in late €˜24. Thank you for the questions.
Dana Brown: So hey Dan, I’ll flip it on you. If you want to go first and maybe tackle some of the metrics oriented, and then I can talk to some of the underlying just assumptions on the business model side.
Dan Shea: Okay. Yeah, I mean I think you’re right to highlight the sale and what that might mean to you know €“ if it’s a sale and it generates cash in a sale, that’s going to obviously help our process for determining how much runway we have to get the detection business up and running or keep running and sort of you know follow through on everything that Dana started with. So you know I think from a margin standpoint, I think the detection margins are €“ I guess you know off the top of my head is like around 80% and you know I think the Xoft margins are more 30% or 40% you know for, obviously for . You know this was probably more like 85 and 40 would be the way to think of it and yes, so I think we’re €“ I think the hard products as you will that are at Xoft are a lower margin than the software we’re selling at the detection side.
Marie Thibault: Okay, okay, and then just given the assumptions?
A – Dana Brown: Yeah, I was just going to say, so the model we have right now is very conservative. So it is actually not dependent on receiving an influx of cash for example from this Xoft sale. That would be good news right, and we would actually treat it a bit as you know an investment reserve, and assuming we create some really compelling ROI models from some of these areas as I mentioned that we could diversify into from a revenue standpoint, and we’re going to be able to deploy right, that cash to bring those additional revenue streams online, so. So this is you know €“ right now, like it’s we’ve laid the catch €“ the cost reductions deep enough that we could be self-sustaining right, to get to this point right, of being cash flow positive and being profitable as we exit next year in the most like conservative scenarios.
And then, we’ve got work ahead of us over the course of the next few months to build out these business case options alternatives and see which ones we want to dive into right and take on, so. And then we would be in a position at that point in time, that we’ve been talking about market opportunity, you know what it could mean to actually grow the business, hopefully even faster.
Marie Thibault: Okay, understood. Thank you for taking the questions.
Dana Brown: You’re welcome.
Operator: Thank you. Your next question is coming from Yale Jen from Laidlaw & Company. Your line is live.
Yale Jen : Good afternoon, and thanks for taking the questions, and congrats again as to €“ on the leader of the company right now.
Dana Brown: Thank you.
Yale Jen : My first question is that it’s just based on a rough estimate, that of this year the therapy business take about 30% of the total revenue, and I understand this year the same transition for the detections of the revenue is a little bit lower. But nevertheless this seems to be a reasonably largely hole that eventually needs to be filled and add more from the detection to €“ presumably to reach the probability goal by the end of 2024. So was there any specific or potential aspect or particular areas you feel that could sort of grow the revenue much quicker and that you can maybe comment on?
A – Dana Brown: So I’ll chime in with one area in particular that I think we’re just beginning to I’ll say maximize right or explore and then Dan I can pass it over to you. I think the greatest near term opportunity we have, and it’s based upon the great work that got accomplished in 2022 is really leveraging some of our new channel partnerships. So I believe on the last earnings call, right, the partnership that’s in development was introduced with Rad Partners, so that’s an exciting partnership. It’s beginning to pick up speed. In fact, I personally probably spend an hour so each day with the team working through details in terms of the architecture, the scaling helping Rad Partners think through how they are going to ramp up their business around it, so that’s an exciting area of growth that we’ll see come online here in 2023 and then really begin to take hold in 2024. So Dan, I’m going to pass it over to you if there’s any other comments you want to add.
Dan Shea: Not a ton. You know, I think you’re right Yale, that so the therapy business is about 29% of our 2022 revenue. And you know I guess the thinking, at least on the path that is to explore strategic options is the feeling that the two businesses aren’t as integrated as we might have originally envisioned in the past and that they €“ you’re not going to lose a lot of synergies by separating the two. And then candidly, it’s just you know what Dana said. It’s giving us more runway to sort of grow into this SaaS subscription model, by (a) hopefully generating a big check or a check for the Xoft business and then (b) really, we’re very focused on preserving cash and minimizing our losses and cash burn.
Yale Jen : Okay, great, that’s very, very helpful. And maybe just one more question here. Which is the Google Health that the partnership you have, just recently built. Would that be more of the increased awareness to a much greater general public, or does — are there sort of other aspects of that could also involve in the revenue generation.
Dana Brown: Yes, so I think just to €“ also just to make sure we’re all clear, right. So this is a technology partnership, right. So we’re leveraging and co-developing technology with Google. Google would not be like a channel partner from a sales perspective for us. But to your point, obviously Google has great brand awareness, a great processing power. We’re actually seeing already the ways in which, knowing the processing power, the lift it’s going to give to operations. Turnaround time right for reading these images is just fantastic. So as part of the work we’re doing and exploring, the best way to deploy the technology with Rad Partners, for example. So I do think that the Google Health relationship will be seen as you know risk mitigation for companies that are moving to cloud for the first time for this kind of technology and services.
I do think because of their brand awareness, because of the work they already have in place around data security and privacy, that’s going to help again hopefully shorten right the sales cycle. So I think like indirectly you’re going to see that it’s going to accelerate and help revenue, even though they’re not per se, a sales channel for us.
