Pulmonx Q2 2026 Earnings Report

Pulmonx EPS Results

• Actual EPS: -$0.24
• Consensus EPS: -$0.28
• Beat/Miss: Beat by +$0.04
• One Year Ago EPS: N/A

Pulmonx Revenue Results

• Actual Revenue: $22.76 million
• Expected Revenue: $22.39 million
• Beat/Miss: Beat by +$362.00 thousand
• YoY Revenue Growth: N/A

Pulmonx Announcement Details

• Quarter: Q2 2026
• Date: 7/29/2026
• Time: After Market Closes
• Conference Call Date: Wednesday, July 29, 2026
• Conference Call Time: 4:30PM ET

Pulmonx (NASDAQ:LUNG) is a commercial-stage medical device company focused on bronchoscopic lung volume reduction for patients suffering from severe emphysema. The company’s flagship therapy, the Zephyr® Endobronchial Valve System, employs one-way valves delivered via a minimally invasive bronchoscopic procedure to collapse diseased portions of the lung, reducing hyperinflation and improving respiratory function. Complementing this treatment, Pulmonx offers the Chartis® Pulmonary Assessment System, which provides clinicians with quantitative measurements of collateral ventilation to aid in patient selection and optimize clinical outcomes.

The Zephyr Valve received the CE mark in Europe in 2008 and FDA approval in the United States in 2018, and it has since been adopted by leading respiratory and thoracic centers across North America and Europe. Pulmonx supports its commercial portfolio with comprehensive physician training programs, ongoing clinical research collaborations, and robust post-market surveillance initiatives. These efforts help validate long-term safety and efficacy, while also guiding future enhancements and potential label expansions for its technologies.

Headquartered in Redwood City, California, Pulmonx maintains an international presence through offices and distribution partners in Europe. Under the leadership of President and Chief Executive Officer Antonio Pizarro, the company continues to advance its mission of improving the quality of life for patients with obstructive lung diseases. Pulmonx remains committed to innovation in minimally invasive therapies and to building strategic relationships with physicians and healthcare institutions worldwide.

Pulmonx Q2 2026 Earnings Call Transcript

Key Takeaways

• Neutral Sentiment: Second-quarter revenue was $22.8 million, down 5% year over year. U.S. revenue declined 4% but increased 7% sequentially, while the international decline was attributed to the suspension of China shipments; 12 new U.S. treating centers were added.
• Positive Sentiment: Management reiterated its 2026 revenue guidance of $90 million to $92 million and expects to return to year-over-year growth later this year, potentially exiting 2026 at or near double-digit growth as new sales representatives ramp.
• Positive Sentiment: Cost reductions produced meaningful operating leverage: net loss fell 34% to $10.1 million and adjusted EBITDA loss improved nearly 40% to $5.1 million. Full-year operating expenses are now expected at $109 million to $111 million, with cash burn projected at approximately $23 million.
• Positive Sentiment: Pulmonx renewed its Chinese registration certificate in June and expects to resume distributor shipments in early 2027; excluding China, international revenue grew 9% on a constant-currency basis. Second-quarter gross margin rose to 78%, and full-year guidance was raised to approximately 76%.
• Positive Sentiment: Enrollment in the pivotal CONVERT II trial for AeriSeal is progressing toward completion in 2027. Management views AeriSeal as a potential tool to expand the global addressable market for Zephyr valves by roughly 20%, with earlier commercial availability possible in certain European markets after local enrollment is complete.

Presentation

[Operator]

Ladies and gentlemen, thank you for standing by. Welcome to Pulmonx second quarter 2026 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star one one on your telephone, and you will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I would like now to turn the call over to Webb Campbell, investor relations. Please go ahead.

[Webb Campbell, VP of Investor Relations at Gilmartin Group]

Good afternoon, thank you for joining today's call. Joining me from Pulmonx are Glen French, President and Chief Executive Officer, and Derrick Sung, Chief Operating Officer and Chief Financial Officer. Earlier today, Pulmonx issued a press release announcing its financial results for the quarter ended June 30th, 2026. A copy of the press release is available on the Pulmonx website. Before we begin, I'd like to remind you that management will make statements during this call that include forward-looking statements within the meaning of Federal Securities laws, which are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Any statements contained in this call that relate to expectations or predictions of future events, results, or performance are forward-looking statements.

[Webb Campbell, VP of Investor Relations at Gilmartin Group]

All forward-looking statements, including, without limitations, those related to our operating trends, commercial strategies, and future financial performance, including long-term outlook and full-year 2026 guidance, the timing and results of clinical trials, physician engagement, expense management, market opportunity, guidance for revenue, gross margin, operating expense, cash usage, commercial expansion, and product demand, adoption and pipeline development, are based upon our current estimates and various assumptions. These 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. Accordingly, you should not place undue reliance on these statements. For a list and description of the risks and uncertainties associated with our business, please refer to the Risk Factors section of our filings with the Securities and Exchange Commission, including our quarterly report on Form 10-Q filed with the SEC on May 4th, 2026.

[Webb Campbell, VP of Investor Relations at Gilmartin Group]

During this call, we will discuss certain non-GAAP financial measures. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are provided in the press release, which is posted on our investor relations website. These non-GAAP measures are not intended to be a substitute for our GAAP results. This conference call contains time-sensitive information and is accurate only as of the live broadcast today, July 29th, 2026. Pulmonx disclaims any intention or obligation, except as required by law, to update or revise any financial projections or forward-looking statements, whether because of new information, future events, or otherwise. With that, I will turn the call over to Glen.

[Glen French, President and CEO at Pulmonx]

Thank you, Webb. Good afternoon, everyone, welcome to our second quarter 2026 earnings call. Here with me is Derrick Sung, our Chief Operating Officer and Chief Financial Officer. Overall, we are very pleased with the progress we are making against our three key priorities of re-accelerating sales growth, driving near-term operating leverage, and advancing our market expanding clinical initiatives. Pulmonx delivered total worldwide revenue of $22.8 million in the second quarter of 2026, consistent with our expectations as our efforts to regain commercial traction play out as anticipated. We remain confident in our ability to achieve our previously communicated revenue guidance of $90 million-$92 million for the full-year 2026 and remain on track to return to global sales growth later in the year.

[Glen French, President and CEO at Pulmonx]

We made a commitment at the start of this year to deliver meaningful operating leverage through our cost alignment initiatives. I am pleased that the impact of our actions is now clearly evident in our results this quarter. We effectively reduced our year-over-year adjusted EBITDA loss by nearly 40% to $5.1 million in the second quarter of 2026. Derrick will provide further details later in the call. Today, I'm pleased to report progress across our remaining two priorities, re-accelerating sales growth and advancing our market expanding clinical initiatives. I will address each of these in turn, starting with our progress on driving U.S. sales growth. Our organization has made great strides in building and maintaining the right people and the right culture in the U.S., which we consider to be a foundational element of re-accelerating revenue growth in the region.

[Glen French, President and CEO at Pulmonx]

I remain encouraged by our progress in this respect. We have now filled all of our sales leadership positions. Those leaders are making rapid progress in rounding out our U.S. field sales team with top talent. We've also seen marked improvement in our commercial team culture as priorities have become clear and incentives are better aligned with our corporate objectives. Sales turnover has normalized consistent with industry standards. We are thrilled with the team that we have in place. As the newer members of our team continue to ramp, we expect U.S. sales growth to build through the back half of the year.

[Glen French, President and CEO at Pulmonx]

Our emphasis remains on disciplined execution of the highest impact selling activities, consistent with the near-to-far framework we've outlined previously. To reiterate, this means, one, setting up high quality and efficient valve programs. Two, engaging with and educating physicians who treat COPD and who are aligned with hospital systems offering Zephyr valves. Three, concentrating on direct-to-patient efforts, specifically on geographies with established treating centers that have the capacity to accommodate interested patients. Finally, four, continuing to work together with our champions to educate service line administrators to ensure appropriate resourcing of their programs.

[Glen French, President and CEO at Pulmonx]

In my interactions with our sales managers and members of our field team, I see a re-energized unit intensely focused on impacting the lives of patients. During meetings with treating physicians and administrators, I hear about hospitals focused on driving value for patients and their systems by aligning resources and processes to scale and expand referral networks. These meetings have validated my conviction that sharper focus on fewer initiatives is helping accelerate growth by focusing on what matters most.

[Glen French, President and CEO at Pulmonx]

With respect to our international business, we continue to see strength and stability across international markets, which delivered 9% year-over-year constant currency revenue growth excluding China. Related to China, we are pleased to share that in mid-June, we secured the renewal of our Chinese registration certificate. With this hurdle behind us, we look forward to resuming shipments to our Chinese distributor by early next year. For the balance of this year, we will be focused on restarting commercial activity in this region. Turning to our second priority, expanding our addressable market through AeriSeal remains a central focus. Enrollments in our CONVERT II pivotal trial is progressing, and we continue to expect to complete enrollment in 2027. We believe that AeriSeal represents a TAM expansion tool for our Zephyr valves and a future revenue contributor with the ability to expand our addressable market by roughly 20% globally.

[Glen French, President and CEO at Pulmonx]

In closing, while 2026 is a year of execution and transition, we're very pleased with our pace of progress, and we have strong conviction in our strategy to refine execution and further penetrate the substantial remaining market opportunity for our products. The organization remains aligned and focused on the priorities that matter most. We're confident in our underlying strength of this business and the opportunity in front of us, and in our ability to deliver sustainable, profitable growth as our year-over-year trends continue to strengthen. With that, I will turn the call over to Derrick to provide more detailed review of our second quarter results.

[Derrick Sung, COO and CFO at Pulmonx]

Thank you, Glen, and good afternoon, everyone. I'd like to start by highlighting the significant progress that we've achieved in driving operating leverage through our P&L. This was a commitment that we had made at the start of the year when we implemented our cost alignment initiative to reduce recurring operating expenses by over 10% while still maintaining investments in our key growth initiatives. As a result of these initiatives, I'm pleased to report that net loss for the second quarter of 2026 was $10.1 million, a reduction of 34% as compared to a net loss of $15.2 million in the same period of the prior year. Net loss per share was $0.24, down from a loss of $0.38 per share in the prior year period.

[Derrick Sung, COO and CFO at Pulmonx]

Most importantly, adjusted EBITDA loss, which excludes non-cash stock-based compensation expense, for the second quarter of 2026 was $5.1 million, compared to $8.4 million in the same period of the prior year. This nearly 40% reduction in adjusted EBITDA loss clearly demonstrates the progress we've made in realizing near-term operating leverage as we work to re-accelerate sales growth. This operating leverage, combined with the recent restructuring of our credit facility, which extends the maturity of our debt to 2031 and provides us with access to an additional $20 million in undrawn capital subject to certain revenue milestones, has meaningfully strengthened our balance sheet. We ended June 30th, 2026, with $55.8 million in cash and cash equivalents, a decrease of $5.8 million from March 31st, 2026.

[Derrick Sung, COO and CFO at Pulmonx]

We continue to expect to burn roughly $23 million of cash for the full-year 2026, which would be nearly a 30% reduction from our cash burn in 2025. Turning back to the top line, total worldwide revenue in the second quarter of 2026 was $22.8 million, a 5% decrease from $23.9 million in the same period last year, and a decrease of 6% on a constant currency basis. U.S. revenue in the second quarter was $14.2 million, a 4% decrease from $14.7 million during the same period of the prior year, and a 7% sequential increase from the first quarter of 2026. We added 12 new U.S. treating centers during the quarter. International revenue in the second quarter of 2026 was $8.6 million, a 6% decrease from $9.1 million during the same period last year, and a decrease of 9% on a constant currency basis.

[Derrick Sung, COO and CFO at Pulmonx]

The decline in international revenue was fully attributable to the lack of sales to our distributor in China. Excluding China, we continued to see solid performance across our other international markets, which grew 12% as compared to the same period last year, and 9% on a constant currency basis. As Glen mentioned, we are pleased to have now received renewal of our Chinese registration certificate and look forward to ramping our commercial activities in the region and resuming distributor shipments by early next year. Gross margin for the second quarter of 2026 was 78%, compared to 72% in the prior year period. The year-over-year increase was driven by a lower mix of distributor sales in our international markets, as well as greater overhead absorption and cost efficiencies across our supply chain.

[Derrick Sung, COO and CFO at Pulmonx]

Looking forward, we now expect gross margin for the full-year of 2026 to be approximately 76%, as we expect to continue to realize some of these benefits throughout the remainder of the year. Total operating expenses for the second quarter of 2026 were $26.8 million, a 16% decrease from $32 million in the same period last year. Non-cash stock-based compensation expense was $3.7 million in the second quarter of 2026. Excluding stock-based compensation expense, operating expenses in the second quarter of 2026 decreased 11% from the same period of the prior year. The decrease in operating expenses reflects the cost reduction efforts that we initiated at the start of the year, and we remain on track to meaningfully reduce our expense trajectory in 2026 while maintaining investments in our key growth initiatives.

[Derrick Sung, COO and CFO at Pulmonx]

To that end, we now expect full-year 2026 operating expenses to fall between $109 million and $111 million, inclusive of approximately $15 million of non-cash stock-based compensation expense. The reduction in our operating expense guidance primarily reflects a reduction in stock-based compensation expense due to the fair value of our shares. R&D expenses for the second quarter of 2026 were $5 million, compared to $5.3 million in the second quarter of 2025. Selling, general, and administrative expenses for the second quarter of 2026 were $21.8 million, compared to $26.7 million in the second quarter of 2025. Finally, turning to our revenue outlook for 2026. We are reiterating our expectation of full-year 2026 revenue in the range of $90 million-$92 million.

[Derrick Sung, COO and CFO at Pulmonx]

As a reminder, our business typically experiences seasonality that results in a sequential decrease in sales in the third quarter of the year as compared to the second quarter. Despite the seasonality, we continue to expect to return to year-over-year growth later this year as we anniversary the impact of the suspension of China shipments in our international business, and as we see improvements to our U.S. business from our recently filled sales positions and our refocused commercial strategy. To conclude, we entered 2026 with a clear plan to improve the trajectory of our business, and we are pleased with the progress that we have made as reflected in our second quarter results. We remain focused on the work ahead, ramping our sales organization, advancing our clinical programs, and delivering the financial leverage we've committed to.

[Derrick Sung, COO and CFO at Pulmonx]

We are confident in the strength of our business and in our team's ability to execute. With that, I'd like to thank you all for your attention, and we will now open the call for questions. Operator?

[Operator]

Thank you. As a reminder to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. The first question will come from Rick Wise with Stifel. Your line is now open.

[Rick Wise, Analyst at Stifel]

Thank you, and hi Glen, hi Derrick. Good to see the progress here. Maybe just to start off, maybe you could dig a little deeper into the sales force positive evolution here, all the leadership positions filled. I just wanted to be sure I'm understanding. Have you filled all the sales positions you want, or that's still something in progress? Just how much more to go on that front?

[Glen French, President and CEO at Pulmonx]

Hey, Rick. This is Glen. We are filling the sales positions. We have a normal amount of turnover that happens in medical device companies. I think the average is nontrivial that happens as a backdrop. What we faced last year was a doubling or tripling of what would be considered normal. We're back on a normal trajectory. We are in the process of the positions that were open when we got here were filled and in the normal course of things, either due to departures based on the rep's decision or based on our decision. There's a normal process that happens, and we're back to normal again as it relates to that.

[Rick Wise, Analyst at Stifel]

Great. Glen, I know you've talked in the past about it takes six to nine months, if I'm remembering correctly. Please correct me if I'm wrong. Takes six to nine months for the average sales guy to get up and running and start to contribute to. I don't know how to ask it, on average now with the folks you've hired since you and Derrick returned to Pulmonx, do you get to that sort of more optimal nine-month range this year on average for the group, the new group? Maybe just give us a little more color when we should really start to expect to see much more visible impact from the team.

[Glen French, President and CEO at Pulmonx]

I think we're starting to see visible impact from the team. Let me just start there. Whether it be the step-up from the first quarter, the second quarter on a sequential basis, or whether, perhaps more importantly, the step-up we see in some of the other indicators that we look at across the board, frankly. We see folks coming up to speed. The six to nine months is what is correct in terms of what we've seen historically. We've made some very, I think, constructive changes to our sales training process, which I think that may modify that six to nine months.

[Glen French, President and CEO at Pulmonx]

I'm not going to claim that it'll happen, but I'm very excited about the combination of leveraging some of the field sales trainers, bringing in new resources to kind of take our sales training to another level, and as a result, perhaps bring people up more quickly. The other thing that we have in place today that we didn't frankly have in place in the same way when I was last here roughly two years ago, is a bench.

[Glen French, President and CEO at Pulmonx]

We have territory account managers who I think you can think of as sort of junior reps who are able to come up to speed quite quickly because they're working under a territory manager, and those folks, in some cases, actually in a lot of cases over the last couple of years, have been able to step into some of these openings along the way, into these territory manager openings and do a really great job. Anyway, there's a lot of things that are happening that may tighten that up, but I think you know me well enough, I'm not going to claim a win on that front until we have some amount of history in the rearview.

[Rick Wise, Analyst at Stifel]

No. I appreciate that. Glen, on China, the registration is accepted. That sounds encouraging. Maybe just talk to us a little bit about the steps you're taking. Just help us better understand the cadence of activities that'll happen now and just when we're going to start to see that revenue more visible. I think you said first quarter, but what has to happen between now and then?

[Glen French, President and CEO at Pulmonx]

We had a situation. Let me first say that, I'll talk a little bit here. Derrick's been very much involved in this process, so I will invite him to share his views if I miss anything here. Registration was a big step. It was a binary proposition, and so getting on the other side of that is wonderful news. We're very excited about that. We saw this coming. I think we've talked about this in the past. When we saw that this registration was going to sunset and that we were going to have some downtime in China as a result of it. We obviously stocked up some inventory, tried to keep accounts going as long as we could, and some number of accounts have a process at this point to restart them.

[Glen French, President and CEO at Pulmonx]

In particular, some of our larger accounts in China have a process to restart them and get underway. As we look at the back half of the year, we're reigniting those accounts, get those engines up and running, and we're anticipating that we probably won't see material revenues until next year, early next year.

[Rick Wise, Analyst at Stifel]

One last question, I'll wait to see whether there's room for more questions as a follow-up. Glen, I apologize to you. I even apologize to Derrick. I hate to bring up 2027, but we have numbers, we've got to print, and maybe just at a high level, you could help us think about it and reflect on current consensus still has you sort of in the mid-90s. I think to myself, China coming back, a repurposed, rebuilt, reconfigured sales force, stronger leadership, more accounts open. I mean, current consensus number is my number in the mid-90s seems very conservative. I realize there's a lot that you've got to do before you get there, and you're not going to give guidance today, I suspect, help us think about that potential. It seems like there's room, if all goes well and as planned, to be actually a very strong year.

[Derrick Sung, COO and CFO at Pulmonx]

Rick, thanks for the question. This is Derrick. I'll refocus your attention to our guidance this year and what we expect this year. I don't want to get out in front of our skis and comment on 2027 guidance right now. We'll certainly do that in due course, probably on our Q4 call. This quarter, or this year, we have said that we are really focused on returning our company back to global sales growth, both in the U.S. and internationally this year. We do expect that contemplated in our guidance.

[Derrick Sung, COO and CFO at Pulmonx]

As we exit the year, that we'll exit the year growing at or close to double digits by the end of even this year. I think we're going to have some very good and strong momentum going into next year. We are really focused right now on reinvigorating our sales force, putting the pieces in place to get ourselves back to sales growth this year. We feel really good about where we are. We're really right where we expect to be in terms of re-accelerating our growth and flipping from negative to positive growth this year.

[Rick Wise, Analyst at Stifel]

It's great to see the progress and congratulations on all. I know it's a lot of hard work involved. Thanks for the answers, appreciate it.

[Operator]

Thank you. Our next question is going to come from Frank Takkinen with Lake Street Capital. Your line's open.

[Nelson Cox, Analyst at Lake Street Capital]

Hey, this is Nelson Cox on for Frank. Thanks for taking the questions and congrats on the progress. Maybe just first to start, as we think about the path to double-digit growth exiting the year that you've talked about, maybe just can you help us with the relative contribution you expect from newer reps ramping versus new centers versus deeper utilization at your established programs?

[Glen French, President and CEO at Pulmonx]

We anticipate that we're going to get some positive contribution across the board there. We've talked about each of these elements. If you want to, we could start with the sales reps. We know that territories that have reps in them do better than territories that don't. We know that there is a ramp-up time for the reps when they're new in the territory. Our average tenure in the company and in the sales organization a couple of years ago was something like two and a half years, and today it's about a year.

[Glen French, President and CEO at Pulmonx]

I'm sure you could have done that math given what you know the turnover was over across last year. In any case, we've got to get those folks up and running. We expect them to be more productive. That will show itself. Greater rep productivity shows itself in an increase in same-store sales, I would expect. We should see that, and we should continue to see new centers come on and so forth. There's a number of things that will need to come together that will contribute to the growth that we envision on the horizon.

[Nelson Cox, Analyst at Lake Street Capital]

Yep, fair enough. Just for my last one, gross margin running at 78% the last couple of quarters here, and you cited a couple of drivers, absorption, supply chain efficiencies. With China shipments now resuming early next year, you have 76% now in the full-year guide, which implies some second half moderation. Anything specific we should be modeling there? Is that just conservatism? Maybe how do you think about the long-term kind of gross margin steady state?

[Derrick Sung, COO and CFO at Pulmonx]

Yeah, that's a great question. China or the absence of sales into China clearly help our gross margin. China does come at a lower gross margin, but still a very attractive operating margin, I'll point out. We would expect to see our gross margin come in a little lower once we do resume shipments into China. I think there is some variability around timing of that resumption of shipments into China. I think we've left a little bit of room for ourselves in terms of our guidance to accommodate that timing.

[Derrick Sung, COO and CFO at Pulmonx]

I do think that we have, over time, excluding China, made some real progress in terms of taking cost out of our supply chain, driving production efficiencies. I feel very comfortable that even when China comes back online, that as a company, we will be comfortably at or above 75% in terms of gross margin. We'll continue to push hard to, over time, move that number higher as we continue to drive overall efficiencies.

[Nelson Cox, Analyst at Lake Street Capital]

Great. Thank you, guys.

[Operator]

Thank you. Our next question will come from Andrea Irawan with Piper Sandler. Your line's open.

[Andrea Irawan, Analyst at Piper Sandler]

Hi, this is Andrea on for Jason. Thanks for taking the question and congrats on the EBITDA progress. I know a lot of us over the years focus on StratX scans as a leading indicator for future Zephyr volumes. Can you just take us through what you're seeing in the U.S. and international markets on StratX? Are you seeing the numbers of scans improve sequentially, and would that match with your revenue guidance? Thanks.

[Glen French, President and CEO at Pulmonx]

Yes. StratX scans, we do keep a close eye on that as a good indicator of what we might expect in the future. We don't tend to get too specific about it, but internally we look at it. You would expect that as we project strengthening of revenue in the back part of this year and frankly, into next year, that we would see an increase in StratX.

[Andrea Irawan, Analyst at Piper Sandler]

Appreciate it. Thank you.

[Operator]

Thank you. Our next question is going to come from William Plovanic with Canaccord. Your line is now open.

[William Plovanic, Analyst at Canaccord]

Good evening, and thanks for taking my question. My first question is on seasonality. If you look at the U.S. last year, it was down 5% Q2 to Q3, and the year before it was flat. Given the ramping sales force, how should we think about that? Is it the typical 5% down, or should it be flatter just because these new reps are becoming productive? Also, same question, as we think about international with China in and out of the picture, how do we think about that? You have easy comps really going into the back half of this year without China. It should be as solidly year-over-year, but also should be probably flat is my guess. Can you help us out with that?

[Derrick Sung, COO and CFO at Pulmonx]

Yeah, absolutely. Thanks for bringing that up, Bill. Appreciate the question. We do typically see seasonality between Q2 and Q3. Typically, we are sequentially down. For sure, outside the U.S. and even within the U.S., we are typically flat to down by a few percent. I would expect to see that same level of seasonality this year as well. While we do have folks coming up to speed, I do think that our folks that we have are still new, and, at this point, I don't expect to see anything different than we have in the past from a seasonality perspective. I do think that that's something that isn't yet modeled when I look into the consensus numbers, into the consensus models. I think there's probably a shifting from Q3 into Q4 in terms of revenue models to reflect that seasonality.

[William Plovanic, Analyst at Canaccord]

Okay, great. On the CONVERT on new accounts, you added 12. I think the original guidance was about 10 a quarter. You did a little better than that in the first quarter. Should we still think about 10 a quarter as we move forward?

[Glen French, President and CEO at Pulmonx]

Yes. That's the way we think about it. Sometimes we're going to hit above, sometimes we'll hit below, but about 40 a year.

[William Plovanic, Analyst at Canaccord]

Okay. Two more for me, just on the CONVERT II, you mentioned that enrollment's progressing and will complete next year. Any update on where AeriSeal will be commercially available or launched in the CE mark nations?

[Glen French, President and CEO at Pulmonx]

We haven't provided an update, as I think, but we have talked about our bigger markets. Germany, the U.K., and France are our biggest markets. Spain and Benelux and Italy and Switzerland. These are all larger European markets. Just for anybody who's not as familiar with our distribution, about 2/3 of our business is in the U.S., one-third is international, and probably 80% of our international business, maybe more than that actually, probably 90% of our international business comes from Europe. Those bigger markets are the ones that some number of those would be the first ones to come online first with AeriSeal. The reason why you asked the question, Bill, is that we have the CE mark on AeriSeal, so we don't have the same regulatory path to market in those countries that we do in the United States.

[William Plovanic, Analyst at Canaccord]

Yeah. Are you going to be launching it in those countries anytime soon? That's the real question.

[Glen French, President and CEO at Pulmonx]

I know. The answer is that we will be launching sooner than we will be in the U.S. The CONVERT II trial is an international trial, and we have centers in most of the countries that I just mentioned. It's a global trial, so it's in the United States, it's across Europe and in Australia. We will not be launching AeriSeal. Two things are going to happen. One, the CONVERT I publication has been submitted for publication, so we're going to get that out before we're going to launch because we need to have some documentation of what people can expect when they use it. The second thing is that we will not be launching into any markets until we are done enrolling CONVERT II patients in those markets. Those are sort of the rate limiters.

[Glen French, President and CEO at Pulmonx]

I'm not going to answer the follow-on question, which is when specifically do we expect to enroll the last patients into CONVERT II in Europe? That would give you a sense of the rough timeline when we would be considering commercializing in some number of European markets.

[William Plovanic, Analyst at Canaccord]

If you complete enrollment in a given country next year, you could commercialize in that country if the trial's enrollment has been completed, even though it's not completed in other CE mark countries. Is that fair to assume?

[Glen French, President and CEO at Pulmonx]

We don't have a specific target. The specific targets we have in the trial is we're trying to establish a ratio of the distribution between the U.S. and OUS. We do not have a specific target in France or a specific target in the U.K. It's really a question of when are we done enrolling OUS patients in CONVERT, at which point we'll move down the path, the commercialization questions. It's not going to be a switch that will be thrown. There will be training that'll happen. It'll be some normal launch activities, which would typically take 90-180 days or something before you'd start seeing folks up and running and adopting and buying.

[William Plovanic, Analyst at Canaccord]

I'll stop on that. Last question for me, I'll give you an easy one. You got the debt facility in place. With milestones, you'll be able to access that. How are you thinking about the path to cash flow breakeven with your current cash and that debt facility access? Thanks for taking the questions.

[Derrick Sung, COO and CFO at Pulmonx]

Thanks, Bill. We feel good about our path to cash flow breakeven. We believe that we have a clear path with the cash that we have on hand and an additional buffer with the access from the debt facility. With the capital that we have access to today, we feel like we can clearly get to cash flow breakeven over the next few years.

[William Plovanic, Analyst at Canaccord]

Thanks.

[Operator]

That does conclude the Q&A session for today. I would now like to turn the call back to Glen French for closing remarks.

[Glen French, President and CEO at Pulmonx]

Thank you, operator. In closing, I'd just like to say that we're focused and executing on the priorities that matter most. I'm pleased with the team we have, the path we are on to improve the trajectory of our business, and the progress we are making. We remain focused on the well-defined work ahead, strengthening our sales organization, advancing our clinical programs, and continuing to improve our financial leverage. We are both confident in the strength of the business and in our team's ability to continue to effectively execute. Thank you all for your time and interest in Pulmonx, and to all Pulmonx employees around the world who work every day to improve the lives of patients with severe emphysema. Thank you.

[Operator]

This concludes today's conference call. Thank you for participating, and you may now disconnect.

Participants

Executives

• Glen French, President and CEO
• Derrick Sung, COO and CFO

Analysts

• Webb Campbell, VP of Investor Relations at Gilmartin Group
• Rick Wise, Analyst at Stifel
• Nelson Cox, Analyst at Lake Street Capital
• Andrea Irawan, Analyst at Piper Sandler
• William Plovanic, Analyst at Canaccord