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DATE

Thursday, Aug. 13, 2026 at 4:30 p.m. ET

CALL PARTICIPANTS

• President and Chief Executive Officer - Steven Foster
• chief financial officer - Kevin Williamson

TAKEAWAYS

• Revenue -- $1.3 million, representing a 127% increase compared to $600,000 in the second quarter of 2025.
• Six-Month Revenue -- $2.7 million, an increase of 106% from $1.3 million in the first half of the prior year.
• Gross Profit -- $800,000, growing 232% over the second quarter of last year.
• Six-Month Gross Profit -- $1.8 million, an increase of 210% from $600,000 in the first six months of 2025.
• Gross Margin -- 64%, a 21 percentage point improvement reflecting better absorption of production overhead and a streamlined commercial footprint.
• Six-Month Gross Margin -- 66%, approximately 22 percentage points higher than the 44% reported in the first half of 2025.
• Training Event Growth -- 98%, measuring the increase in physician and distributor training events in the first half of 2026 compared to the second half of 2025.
• Operating Expenses -- $4.2 million, up from $3.1 million in the second quarter of 2025 due to higher sales and marketing costs.
• Six-Month Operating Expenses -- $8.4 million, compared to $7.1 million in the prior year period.
• Sales and Marketing Expense -- $1.9 million, driven by the expanded commercial team and the rollout of the SImmetry+ system.
• Research and Development Expense -- $768,000, reflecting continued investment in future product additions and system enhancements.
• Net Loss -- $4.1 million, compared to a net loss of $2.8 million in the second quarter of 2025.
• Net Loss Per Share -- $12.35, compared to $12.76 per share in the second quarter of 2025.
• Six-Month Net Loss Per Share -- $23.16, compared to $39.91 per share in the same period of 2025.
• Cash and Cash Equivalents -- $1.7 million, ending the quarter on June 30, 2026, compared to $3.8 million at the end of 2025.
• Public Offering Proceeds -- $4.2 million, closed on July 1, 2026, intended for partial debt repayment and commercial expansion.
• Non-Cash Interest Expense -- $900,000, related to the amortization of the original issue discount on convertible notes.
• Convertible Debt -- $5.2 million, maturing on Sept. 11, 2026, with an option to extend the maturity to Dec. 11, 2026.
• Reverse Stock Split -- 1-for-35, effected on Aug. 10, 2026, as part of efforts to regain Nasdaq compliance.

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RISKS

• Williamson warned that regarding the company's $5.2 million in convertible notes maturing in late 2026, "there can be no assurance the Company will repay or refinance these obligations in full."

SUMMARY

Management reported that second quarter performance included record revenue and gross profit, supported by increased surgical procedure volume and the integration of the SImmetry+ system. The company stated that it achieved gross margin expansion of 21 percentage points through improved production overhead absorption and higher field productivity. Financial activities following the quarter included a public offering to bolster the balance sheet and a reverse stock split to address Nasdaq listing requirements. Operations focused on physician training and the development of new product features intended to address unmet needs in sacroiliac joint fusion.

• Foster stated that the 510(k) clearance for the updated Catamaran system "incorporates various instrument upgrades, as well as the reclassification of certain instruments from disposable to reusable status."
• Management expects the shift from disposable to reusable instrumentation to drive margin improvements starting in the third quarter of 2026.
• The newly opened sales and training office in Tampa contributed to a 98% increase in training events during the first half of the year.
• An enhanced SImmetry+ system featuring streamlined decortication is scheduled to become clinically active in October 2026.
• The company is developing a third approach to the space, representing a novel product offering intended to meet large unmet needs.
• Management reported that physician and distributor training activity resulted in a record monthly case volume in July 2026.

INDUSTRY GLOSSARY

• 510(k): A premarket submission made to the FDA to demonstrate that a medical device is safe and effective by being substantially equivalent to a legally marketed device.
• Catamaran SI Joint Fusion System: A proprietary titanium implant system designed for a less invasive approach to fusing the sacroiliac joint.
• Decortication: The surgical removal of the surface layer of a structure, such as bone, to promote healing or fusion.
• Sacroiliac joint (SI Joint): The joint connecting the sacrum of the spine to the ilium of the pelvis.
• SImmetry+ System: A lateral access solution for sacroiliac joint fusion acquired by Tenon Medical in August 2025.

Full Conference Call Transcript

Operator: Greetings, and welcome to the Tenon Medical Second Quarter 26 Financial Results and Corporate Update Conference Call. As a reminder, this call is being recorded. Your hosts today are Steven Foster, President and Chief Executive Officer and Kevin Williamson, chief financial officer. Mr. Foster and Mr. Williamson will present results of operations for the second quarter ended 06/30/2026 and provide a corporate update. A press release detailing these results was released today and is available on the Investor Relations section of our company's website www.tenonmed.com. Before we begin the formal presentation, I would like to remind everyone statements made on the call and webcast may include predictions estimates, and other information that might be considered forward looking.

While these forward looking statements represent our current judgment on what the future holds, they are subject to risks and uncertainties that could cause actual results to differ materially. You are cautioned not to place undue reliance on these forward looking statements, which reflect our opinions only as of the date of this presentation. Please keep in mind that we are not obligating ourselves to revise or publicly release the results of any revision. To these forward looking statements in light of new information or future events. For a more complete discussion of these factors and other risks, you should review our quarterly and annual reports on file with the Securities and Exchange Commission at www.sec.gov.

At this time, I would like to turn the call over to Tenon Medical's chief executive officer, Steven Foster. Please go ahead, sir.

Steven Foster: Thank you, Joe, and good afternoon, everyone. I am pleased to welcome you to today's Second Quarter 26 financial results and corporate update conference call for Tenon Medical. Second quarter revenue was $1.3 million an increase of 127% over the second quarter last year and gross profit was $800 thousand an increase of 232%. Over the prior year period. Each was the highest we have reported in the second quarter. Gross margin was 64%, compared to 43% a year ago. Case volume grew across both the Catamaran and SImmetry+ platforms, and each incremental procedure is now carrying meaningfully more profit.

Looking at the first half as a whole, revenue was $2.7 million, an increase of 106% from $1.3 million in the first 6 months of 2025. Gross profit was $1.8 million an increase of 210% from $600 thousand at a gross margin of 66% compared with 44%. Our loss from operations for the 6 months was $6.6 million compared with $6.5 million a year ago essentially unchanged. While revenue doubled and gross profit dollars roughly tripled. Growth on the top line came from a higher number of Catamaran cases and continued meaningful SImmetry+ contribution since we acquired the SiVantage assets in August of last year. Position and distributor training is the leading indicator for us.

And on that front, our training events increased 98% in the first half of 26 compared with the second half of 25. Gross margin expanded substantially year over year. At 54%, we are approximately 21 percentage points higher than the second quarter of last year and at 66% for the first half we are roughly 22 points higher than the same period in 2025. Increased revenue has contributed through improved absorption of fixed production overhead, and we are also benefiting from more streamlined commercial footprint and stronger field productivity. Beyond the financials, a few items from the quarter are worth noting. First, on the commercial side, our platform offering continues to progress the way we had planned.

With physicians evaluating Catamaran and SImmetry+ as complementary tools. Inferior, posterior, and lateral approaches, to the same anatomy. As part of our continued investment in commercial activity, we have hired a seasoned professional sales lead to our East Coast sales team. And expect to add further sales heads and distributor partners in the back half of the year. Additionally, we saw a meaningful uptick in our physician and distributor training activity in Q2, driven by our newly opened Tampa sales and training office which has contributed to a record case value month in July and a strong start to Q3.

Second, as it relates to regulatory matters, subsequent to the quarter end, on July 2, we announced that we received FDA 510(k) clearance for the catamaran SI joint fusion system. The updated clearance incorporates various instrument upgrades, as well as the reclassification of certain instruments from disposable to reusable status. Which is expected to improve system performance, while reducing ongoing per procedure costs previously associated with disposable instrumentation, improving margins which we expect to play out meaningfully beginning in Q3. Third, we have had a busy quarter with our R&D initiatives and are nearing multiple launches that we believe will be meaningful in this space.

First, we have an enhanced SImmetry+ system that includes streamlined decortication, which will become clinically active in Q3 and is a significant improvement to this system. Second, we are nearing the final stages of development and approaching filing for 510(k) approval. Of an enhanced feature to the SImmetry+ implant which will make the implant even further differentiated. And third, we are excited about the progress we have made on a third approach to the space, an additional product offering to Catamaran and SImmetry+ that we believe meets a large unmet need in a very novel way. Fourth, as it relates to capital, on July 1, we closed a public offering of common stock or prefunded warrants.

And common stock purchase warrants, for aggregate gross proceeds of $4.2 million Net proceeds are expected to be used for partial repayment of our outstanding convertible notes. Commercial expansion, clinical research, and general corporate purposes. Looking out over the rest of the year, our focus is narrow. Keep growing procedure volumes on both platforms continue aggressive physician training and education, accelerate key R&D projects, and protect the gross margin gains we have built over the past year as we scale. We have multiple ways to win in this market, and we intend to use them. With that, I will turn the call over to Kevin to discuss our financials.

Kevin Williamson: Thank you, Steven. I will now provide a summarized review of our financial results. A full breakdown is available in our press release, crossed the wire this afternoon. Starting with the top line, second quarter revenue was 1.3 million a record for any second quarter in the company's history. And up 127% from $600 thousand a year ago. Revenue for the 6 months ended 06/30/2026 was 2.7 million. An increase of 106% compared to 1.3 million in the 6 months ended 06/30/2025. The increase in the quarter was driven by a large increase in the number of surgical procedures performed. As well as the addition of revenue related to the SImmetry+ system.

Over the past 12 months, we have meaningfully increased our physician user base, and surgical case volume and we expect to continue to build on that momentum through Salesforce expansion increased physician and distributor engagement, and future product launches. Gross profit was $800 thousand or 64% of revenue in the second quarter, compared to $200 thousand or 43% of revenue a year ago. that is a 232% increase in dollar terms. And the highest for any second quarter in the company's history. On a margin basis, we picked up about 21 percentage points year over year. For the 6 months, gross profit was 1,$800 thousand or 66.2% of revenue, compared to 600 thousand or 44.0% of revenue.

A 210% increase in dollars and roughly 22 percentage points. The improvement was primarily driven by higher revenue and lower costs in the period, driving further absorption of production overhead costs within cost of goods sold. We continue to expect to see our gross margin expand as revenue increases, and we further absorb fixed costs within our cost of sales. Operating expenses totaled $4.2 million in the second quarter, compared to $3.1 million in the second quarter of 25. For the 6 months, operating expenses totaled $8.4 million compared to $7.1 million in the prior year period. The increase in the quarter was primarily due to higher sales and marketing expenses, associated with higher revenue.

In addition to higher research and development expenses, as we continue to work towards future product additions. Net loss was $4.1 million, or $12.35 per share in the second quarter, compared to a net loss of $2.8 million or $12.76 per share second quarter of 25. For the 6 months, net loss was $7.5 million or $23.23 per share compared to a net loss of $6.4 million or $39.91 per share the same period a year ago. The increase in net loss was primarily driven below the operating line. $900 thousand of non-cash interest expense related to the amortization of the original issue discount related to our convertible notes which was not present in the prior year period.

We ended the quarter with $1.7 million in cash and cash equivalents, compared to $3.8 million as of 12/31/2025. Subsequent to quarter end on July 1, we closed the public offering with gross proceeds of $4.2 million which provides additional runway to fund our commercial, clinical, and development priorities. Overall, we believe the financial and strategic actions taken through the first half of 26 have positioned Tenon to drive continued growth in the second half and into 2027. While sustaining a streamlined and disciplined cost base and executing on our commercial and upcoming product launch initiatives. I will now hand the call back to Steven for closing comments.

Steven Foster: Thank you, Kevin. In conclusion, we believe Tenon is delivering top line growth margin growth a cost structure that is expected to provide efficiencies as we expand our offerings. Significant progress has been made on vital R&D projects, promising a diversified and innovative portfolio of sacropelvic technologies over the next 6 to 9 months. Focus on commercial expansion, and execution positions Tenon to build on this momentum and deliver increasing value to patients providers, and our shareholders. I thank you all for attending, and I would like to hand the call over to our operator to begin our Q&A session with covering analysts. Joe?

Operator: Thank you, sir. Ladies and gentlemen, if you would like to ask a question, please press 1 on your telephone keypad. And a confirmation tone will indicate your line is in the question queue. You may press 2 if you would like to remove your question from the queue. May be necessary to pick up your handset. Before pressing the star keys. And our first question comes from the line of Nicholas Sherwood with Maxim. Please proceed.

Nicholas Sherwood: Hi, good evening. Thank you for taking my questions. Can you kind of just talk about any sort of advancements that have come in the SiVantage product pipeline? How you are feeling about the regulatory or the research and development on those?

Steven Foster: Yes. Thanks, Nicholas. I appreciate the So when we did the SiVantage, transaction, they already had commercial activity in the SImmetry+ component of their of their offering. There are 3 major components to that technology. 1 was already released when we did the transaction. The second is an enhanced accreditation tool, which we mentioned will be out here in October for clinical use. And the second is in addition to the implant construct that we really think is going to be very novel and unique and answer some of the needs that have been communicated to us by our physician customers.

So you are going to see a greatly enhanced SImmetry+ platform over the coming 2 to 6 months as we roll all of this stuff out. And we really believe that platform is going to become very attractive to physicians that do lateral oblique procedures. Secondarily, SiVantage had a novel posterior technology, posterior approach technology, that we are now just finishing testing on and preparing for an FDA submission in that arena. Very excited where that is going. Anxious to share more, probably in the next quarterly review. We will get into some details about what that technology looks like, how it is positioned, how it is targeted, and things of that nature.

So the SiVantage portfolio is delivering as expected. Some really nice pipeline enhancements and what have you, and we are really excited about what is to come.

Nicholas Sherwood: Yeah. that is that is an exciting thing. And my next question is, this summer, it might be more a slower period when it comes to training new physicians. Can you kind of talk about are there any special events or pushes that you are going to have through the end of this year, kind of that, you know, sort of back to school season so to speak, when it comes to bringing in new physicians and training them on your technology?

Steven Foster: Yeah. Sure. Appreciate that. Look, I suppose with all of our activities, there is a little bit of seasonality. And certainly, it is true with physician training activities. We mentioned the opening of a training center in Tampa, and we are finding the demand to visit the facility to see the array of technologies that are there both in imaging as well as our own implant technology navigation technologies, things of that nature. Is really attractive. And, frankly, it is exceeded all of our expectations, the demand, the visits and what have you. So, you know, we mentioned some pretty significant growth in our training activity in the first half of 26 compared to 25.

We attribute most of that to the new facility that we have invested in. In the in, frankly, the really cool environment and experience that is being delivered when physicians visit that site. So we are we are actually seeing an uptick, and I anticipate continued uptick, not only because the facility there but as we start rolling out the enhancements to SImmetry+ the new technologies we talked about, etcetera, there will be even more compelling reasons for physicians to visit and take a look at what is happened.

Nicholas Sherwood: Awesome. Yeah. That sounds like there is some good progress there. Thank you for answering questions, and I will return to the queue.

Steven Foster: Thanks, Nicholas.

Operator: Thank you. This will conclude the question and answer session. And I would now like to turn the call back to Mr. Foster for his closing remarks.

Steven Foster: Thank you, Joe. I would like to thank each of you for joining our earnings conference call today and look forward to continuing to update you on our ongoing progress and growth. If we were unable to answer any of your questions, please reach out to our IR firm, MZ Group, We will be more than happy to assist. With that, I wish everybody a good evening.

Operator: This concludes today's conference. You may disconnect your lines at this time. And enjoy the rest of your day.