4DMedical’s Cost Cuts and FDA Submission Set Stage for Market Disruption

Strong Financial Momentum and Operational Efficiency

4DMedical Limited (ASX:4DX) has delivered a robust financial performance in the first nine months of FY2025, doubling its operating revenue to $4.5 million compared to the prior corresponding period. The company maintained impressive gross margins of 91.4%, underscoring the scalability and profitability of its SaaS-based respiratory imaging solutions. Quarterly revenue growth continued into Q3 FY2025, with an 8% increase over the previous quarter and a 42% rise in underlying SaaS revenue after adjusting for one-off items.

Operationally, 4DMedical has implemented a significant cost reduction program, achieving $6.5 million in annualized savings primarily through a reduction in global headcount from 142 to 117 full-time employees and stringent control over non-personnel expenses. These measures have already begun to reduce operating expenses, positioning the company for improved profitability in upcoming quarters.

Expanding Global Footprint and Commercial Traction

The company’s SaaS footprint expanded by 20% in Q3 FY2025, now serving 361 sites worldwide, up from 301 in the previous quarter. Scan volumes surged 34% quarter-on-quarter, driven by increased adoption of Lung Density Analysis (LDAi), SeleCT screening, and RV/LV analysis. This growth reflects strong market demand across private, academic, and distributor channels.

4DMedical secured several key contract renewals and new commercial agreements during the quarter. Notably, the Cleveland Clinic renewed a three-year SaaS contract valued at a minimum of A$227,000, reinforcing the company’s presence in a globally renowned academic medical center. In Australia, pilot programs with Integral Diagnostics and Qscan Radiology Clinics successfully converted into commercial contracts, broadening access to 4DMedical’s pulmonary function and structure analysis products.

Regulatory Progress and Product Innovation

The company is on the cusp of submitting its CT:VQ™ ventilation and perfusion imaging technology for FDA 510(k) clearance. This milestone is highly anticipated by academic medical centers and industry collaborators, including the Brooke Army Medical Center, the largest medical facility within the U.S. Department of Defense, which has already acquired CT:VQ™ for clinical research. Early clinical results are expected to be presented soon, potentially validating CT:VQ™ as a faster, safer, and more accessible alternative to nuclear ventilation-perfusion imaging.

In parallel, 4DMedical secured regulatory approval for its CT Lung Ventilation Analysis Software (CT LVAS™) in Canada, complementing existing approvals for Lung Density Analysis, Lung Texture Analysis, and Lung Nodule SaaS products. This regulatory breadth enhances the company’s competitive positioning in North America, a market with significant healthcare expenditure and demand for advanced respiratory diagnostics.

Strategic Partnerships and Market Advocacy

4DMedical’s partnership with Philips is gaining commercial traction, with over 200 Philips sales personnel trained to promote 4DMedical’s portfolio. The collaboration was spotlighted during testimony by Philips North America’s CEO before the U.S. House Committee on Veterans’ Affairs, where 4DMedical’s technology was presented as a transformative solution for veteran healthcare. This high-profile endorsement underscores the strategic value and market potential of 4DMedical’s innovations.

The company also showcased its full product suite at major industry congresses, including the Society of Thoracic Radiology in the U.S. and the Thoracic Society of Australia and New Zealand, generating a strong pipeline of commercial leads and peer recognition. With Australia’s National Lung Cancer Screening Program launching in July 2025, 4DMedical is well positioned to integrate its lung nodule detection and incidental findings assessment technologies into this significant public health initiative.

Capital Raise Supports Accelerated Growth

In March 2025, 4DMedical completed a heavily oversubscribed capital raise totaling $13.9 million through a placement and share purchase plan. The funds will underpin working capital needs and accelerate commercialization efforts, particularly the FDA submission for CT:VQ™. The company’s cash balance stood at $16.8 million at quarter-end, providing a solid financial runway to execute its strategic plan.

CEO Andreas Fouras highlighted the disconnect between operational success and share price, signaling confidence in upcoming milestones to realign market valuation. The company’s focus on organic growth, combined with strategic partnerships and regulatory advances, sets the stage for a transformative year ahead in respiratory diagnostics.