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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

​

FORM 10-Q

​

(Mark One)

☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

​

For the quarterly period ended June 30, 2025

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OR

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☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

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For the transition period from to

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Commission File Number: 001-39032

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PROFOUND MEDICAL CORP.

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(Exact Name of Registrant as Specified in its Charter)

​

​ | ​
Ontario, Canada | Not Applicable
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.)
​ | ​
2400 Skymark Avenue, Unit #6, Mississauga, Ontario, Canada (Address of principal executive offices) | L4W 5k5 (Zip Code)

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Registrant’s telephone number, including area code: (647) 476-1350

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Securities registered pursuant to Section 12(b) of the Act:

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​ | ​ | ​ | ​ | ​
Title of each class |  | Trading Symbol(s) |  | Name of each exchange on which registered
Common Shares, No Par Value Per Share | ​ | PROF | ​ | Nasdaq Stock Market LLC

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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

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Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

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Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

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​ | ​ | ​ | ​ | ​ | ​
Large accelerated filer |  | ☐ | Accelerated filer |  | ☐
Non-accelerated filer | ​ | ☒ | Smaller reporting company | ​ | ☒
Emerging growth company | ​ | ☐ | ​ | ​ | ​

​

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

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As of August 14, 2025, the registrant had 30,053,142 common shares, no par value per share, outstanding.

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EXPLANATORY NOTE

Profound Medical Corp. (the “Company”) qualifies as a “Foreign Private Issuer,” as defined in Rule 3b-4 under the Securities Exchange Act of 1934 (the “Exchange Act”) and is exempt from filing quarterly reports on Form 10-Q by virtue of Rules 13a-13 and 15d-13 under the Exchange Act. The Company has voluntarily elected to file this Quarterly Report on Form 10-Q for the quarter ended June 30, 2025.

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Table of Contents

Form 10-Q – QUARTERLY REPORT

For the Quarter Ended June 30, 2025

Table of Contents

​ | ​ | ​
​ | ​ | Page
PART I. | Financial Information | ​
Item 1. | Condensed Consolidated Financial Statements | ​
​ | Condensed Consolidated Balance Sheets (Unaudited) | 1
​ | Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) | 2
​ | Condensed Consolidated Statements of Shareholders’ Equity (Unaudited) | 3
​ | Condensed Consolidated Statements of Cash Flows (Unaudited) | 5
​ | Notes to Condensed Consolidated Financial Statements | 6
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 15
Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 22
Item 4. | Controls and Procedures | 22
PART II. | Other Information | 23
Item 1. | Legal Proceedings | 23
Item 1A. | Risk Factors | 23
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 23
Item 3. | Defaults Upon Senior Securities | 23
Item 4. | Mine Safety Disclosures | 23
Item 5. | Other Information | 24
Item 6. | Exhibits | 24
Signatures | 25

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Table of Contents

Profound Medical Corp.

CONDENSED CONSOLIDATED BALANCE SHEET S

(USD in thousands, except per share data)

(unaudited)

​

​ | ​ | ​ | ​ | ​
​ | ​ | June 30, | ​ | December 31,
​ |  | 2025 |  | 2024
​ | ​ | $ | ​ | $
Assets | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​
Current assets: | ​ | ​ | ​ | ​
Cash | ​ | 35,195 |  | 54,912
Trade and other receivables, net (note 3) | ​ | 4,898 |  | 7,045
Inventory (note 4) | ​ | 8,353 |  | 5,801
Prepaid expenses and deposits | ​ | 365 |  | 1,307
Total current assets | ​ | 48,811 |  | 69,065
​ | ​ | ​ | ​ | ​
Property and equipment, net (note 5) | ​ | 278 |  | 425
Intangible assets, net (note 6) | ​ | 175 |  | 261
Right-of-use assets, net | ​ | 303 |  | 396
Deferred tax assets, net | ​ | 101 | ​ | 87
Total assets | ​ | 49,668 |  | 70,234
​ | ​ | ​ | ​ | ​
Liabilities | ​ | ​ |  | ​
​ | ​ | ​ | ​ | ​
Current liabilities: | ​ | ​ |  | ​
Accounts payable | ​ | 949 |  | 1,317
Accrued expenses and other current liabilities (note 7) | ​ | 3,802 |  | 2,835
Deferred revenue | ​ | 694 |  | 419
Long-term debt (note 8) | ​ | — |  | 1,737
Lease liabilities | ​ | 279 |  | 257
Total current liabilities | ​ | 5,724 |  | 6,565
​ | ​ | ​ | ​ | ​
Deferred revenue | ​ | 74 |  | 49
Long-term debt (note 8) | ​ | 4,462 |  | 2,924
Lease liabilities | ​ | 72 |  | 203
Other non-current liabilities | ​ | 77 |  | 71
Total liabilities | ​ | 10,409 |  | 9,812
​ | ​ | ​ | ​ | ​
Shareholders’ equity | ​ | ​ |  | ​
​ | ​ | ​ | ​ | ​
Common shares, no par value, unlimited shares authorized, 30,053,142 and 30,039,809 issued and outstanding at June 30, 2025 and December 31, 2024, respectively (note 9) | ​ | 281,641 |  | 281,552
Additional paid-in capital | ​ | 23,649 |  | 21,298
Accumulated other comprehensive income | ​ | 5,558 |  | 2,742
Accumulated deficit | ​ | (271,589) |  | (245,170)
Total shareholders’ equity | ​ | 39,259 |  | 60,422
​ | ​ | ​ | ​ | ​
Total liabilities and shareholders’ equity | ​ | 49,668 |  | 70,234

​

The accompanying notes are an integral part of these condensed consolidated financial statements.

1

Table of Contents

Profound Medical Corp.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(USD in thousands, except per share data)

(unaudited)

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended June 30, | ​ | Six Months Ended June 30,
​ |  | 2025 |  | 2024 |  | 2025 |  | 2024
​ | ​ | $ | ​ | $ | ​ | $ | ​ | $
Revenue (note 11) | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Recurring - non-capital |  | 1,561 |  | 1,460 | ​ | 3,362 | ​ | 2,899
Capital equipment |  | 650 |  | 773 | ​ | 1,470 | ​ | 773
​ |  | 2,211 |  | 2,233 | ​ | 4,832 | ​ | 3,672
Cost of sales |  | 593 |  | 812 | ​ | 1,361 | ​ | 1,385
Gross profit |  | 1,618 |  | 1,421 | ​ | 3,471 | ​ | 2,287
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Operating expenses |  | ​ |  | ​ | ​ | ​ | ​ | ​
Research and development |  | 6,098 |  | 4,205 | ​ | 10,906 | ​ | 8,150
Selling, general and administrative |  | 9,326 |  | 5,058 | ​ | 17,537 | ​ | 9,856
Total operating expenses |  | 15,424 |  | 9,263 | ​ | 28,443 | ​ | 18,006
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Operating loss |  | 13,806 |  | 7,842 | ​ | 24,972 | ​ | 15,719
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Other (income) expenses |  | ​ |  | ​ | ​ | ​ | ​ | ​
Net finance (income) expense |  | (343) |  | (422) | ​ | (788) | ​ | (884)
Net foreign exchange (gain) loss |  | 2,168 |  | (520) | ​ | 2,130 | ​ | (1,390)
Total other (income) expenses |  | 1,825 |  | (942) | ​ | 1,342 | ​ | (2,274)
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net loss before income taxes |  | 15,631 |  | 6,900 | ​ | 26,314 | ​ | 13,445
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Income tax expense |  | 78 |  | 19 | ​ | 119 | ​ | 59
Deferred tax recovery |  | (14) |  | — | ​ | (14) | ​ | —
Total income tax expense | ​ | 64 | ​ | 19 | ​ | 105 | ​ | 59
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net loss attributed to shareholders for the period |  | 15,695 |  | 6,919 | ​ | 26,419 | ​ | 13,504
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Other comprehensive (income) loss |  | ​ |  | ​ | ​ | ​ | ​ | ​
Item that may be reclassified to (income) loss |  | ​ |  | ​ | ​ | ​ | ​ | ​
Foreign currency translation adjustment |  | (2,713) |  | 470 | ​ | (2,816) | ​ | 1,439
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net loss and other comprehensive loss for the period |  | 12,982 |  | 7,389 | ​ | 23,603 | ​ | 14,943
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Loss per share (note 12) |  | ​ |  | ​ | ​ | ​ | ​ | ​
Basic and diluted net loss per common share |  | 0.52 |  | 0.28 | ​ | 0.88 | ​ | 0.55
Basic and diluted weighted average common shares outstanding |  | 30,053,142 |  | 24,440,444 | ​ | 30,055,047 | ​ | 24,373,869

​

The accompanying notes are an integral part of these condensed consolidated financial statements.

​

​

2

Table of Contents

Profound Medical Corp.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(USD in thousands)

(unaudited)

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | ​ |  | ​ |  | ​ |  | Accumulated |  | ​ |  | ​
​ | ​ | ​ | ​ | ​ | ​ | Additional | ​ | Other | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | Paid-in | ​ | Comprehensive | ​ | Accumulated | ​ | ​
​ | ​ | Common Shares | ​ | Capital | ​ | Income | ​ | Deficit | ​ | Tota1
​ | ​ | Shares | ​ | Amount $ | ​ | $ | ​ | $ | ​ | $ | ​ | $
Balance - December 31, 2024 |  | 30,039,809 |  | 281,552 |  | 21,298 |  | 2,742 |  | (245,170) |  | 60,422
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net loss for the period |  | — |  | — |  | — |  | — |  | (10,724) |  | (10,724)
Cumulative translation adjustment – net of tax of $nil |  | — |  | — |  | — |  | 103 |  | — |  | 103
Vesting of RSUs (note 10) | ​ | 13,333 | ​ | 89 | ​ | (89) | ​ | — | ​ | — | ​ | —
Share-based compensation (note 10) |  | — |  | — |  | 989 |  | — |  | — |  | 989
Balance – March 31, 2025 |  | 30,053,142 |  | 281,641 |  | 22,198 |  | 2,845 |  | (255,894) |  | 50,790
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net loss for the period |  | — |  | — |  | — |  | — |  | (15,695) |  | (15,695)
Cumulative translation adjustment – net of tax of $nil |  | — |  | — |  | — |  | 2,713 |  | — |  | 2,713
Share-based compensation (note 10) |  | — |  | — |  | 1,451 |  | — |  | — |  | 1,451
Balance – June 30, 2025 |  | 30,053,142 |  | 281,641 |  | 23,649 |  | 5,558 |  | (271,589) |  | 39,259

​

The accompanying notes are an integral part of these condensed consolidated financial statements.

​

3

Table of Contents

Profound Medical Corp.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(USD in thousands)

(unaudited)

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | Accumulated | ​ | ​ | ​ |
​ | ​ | ​ | ​ | ​ | ​ | Additional | ​ | Other | ​ | ​ | ​ |
​ | ​ | ​ | ​ | ​ | ​ | Paid-in | ​ | Comprehensive | ​ | Accumulated | ​ |
​ | ​ | Common Shares | ​ | Capital | ​ | Income | ​ | Deficit | ​ | Total
​ | ​ | Shares | ​ | Amount $ | ​ | $ | ​ | $ | ​ | $ | ​ | $
Balance - December 31, 2023 |  | 21,370,565 |  | 222,205 |  | 20,808 |  | 5,565 |  | (217,354) |  | 31,224
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net loss for the period |  | — |  | — |  | — |  | — |  | (6,585) |  | (6,585)
Cumulative translation adjustment – net of tax of $nil |  | — |  | — |  | — |  | (969) |  | — |  | (969)
Shares issued in public offering and private placement |  | 3,058,334 |  | 21,079 |  | — |  | — |  | — |  | 21,079
Share-based compensation (note 10) |  | — |  | — |  | 767 |  | — |  | — |  | 767
Balance – March 31, 2024 |  | 24,428,899 |  | 243,284 |  | 21,575 |  | 4,596 |  | (223,939) |  | 45,516
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net loss for the period | ​ | — | ​ | — | ​ | — | ​ | — | ​ | (6,919) | ​ | (6,919)
Cumulative translation adjustment – net of tax of $nil | ​ | — | ​ | — | ​ | — | ​ | (470) | ​ | — | ​ | (470)
Exercise of share options (note 10) | ​ | 101 | ​ | 1 | ​ | (1) | ​ | — | ​ | — | ​ | —
Vesting of RSUs (note 10) | ​ | 52,835 | ​ | 413 | ​ | (413) | ​ | — | ​ | — | ​ | —
Share-based compensation (note 10) | ​ | — | ​ | — | ​ | 768 | ​ | — | ​ | — | ​ | 768
Balance – June 30, 2024 | ​ | 24,481,835 | ​ | 243,698 | ​ | 21,929 | ​ | 4,126 | ​ | (230,858) | ​ | 38,895

​

The accompanying notes are an integral part of these condensed consolidated financial statements.

​

​

​

4

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Profound Medical Corp.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW S

(USD in thousands)

(unaudited)

​

​ | ​ | ​ | ​ | ​
​ | ​ | Six Months Ended June 30,
​ |  | 2025 |  | 2024
​ | ​ | $ | ​ | $
Cash flows from operating activities |  |  |  |
Net loss for the period |  | (26,419) | ​ | (13,504)
Adjustments to reconcile net loss to net cash provided by operating activities: |  | ​ | ​ | ​
Depreciation of property and equipment (note 5) |  | 218 | ​ | 383
Amortization of intangible assets (note 6) |  | 86 | ​ | 101
Non-cash lease expense adjustment |  | (19) | ​ | (21)
Share-based compensation (note 10) |  | 2,440 | ​ | 1,535
Interest and accretion expense |  | 51 | ​ | 323
Change in amortized cost of trade and other receivables |  | — | ​ | (167)
Changes in operating assets and liabilities: |  | ​ | ​ | ​
Trade and other receivables (note 3) |  | 2,449 | ​ | 484
Inventory (note 4) |  | (2,723) | ​ | (168)
Prepaid expenses and deposits |  | 1,042 | ​ | 773
Accounts payable, accrued expenses and other liabilities (note 7) |  | 545 | ​ | (507)
Deferred revenue |  | 317 | ​ | 18
Deferred tax liabilities |  | (14) | ​ | 2
Net cash used in operating activities |  | (22,027) | ​ | (10,748)
​ | ​ | ​ | ​ | ​
Cash flows from financing activities |  | ​ | ​ | ​
Repayments of long-term debt (note 8) | ​ | (290) | ​ | (1,227)
Issuance of commons shares (note 10) | ​ | — | ​ | 22,938
Payments of financing costs (note 10) | ​ | — | ​ | (1,859)
Proceeds from the exercise of stock options (note 10) |  | — |  | 1
Net cash provided by (used in) financing activities | ​ | (290) | ​ | 19,853
​ | ​ | ​ | ​ | ​
Net increase (decrease) in cash | ​ | (22,317) | ​ | 9,105
Effect of exchange rate changes on cash | ​ | 2,600 | ​ | (1,239)
Cash, beginning of period | ​ | 54,912 | ​ | 26,213
Cash, end of period | ​ | 35,195 | ​ | 34,079
​ | ​ | ​ | ​ | ​
Supplemental cash flow information: | ​ | ​ | ​ | ​
Interest paid, included in financing activities | ​ | 139 | ​ | 307
Income taxes paid, included in operating activities | ​ | 65 | ​ | 174

​

The accompanying notes are an integral part of these condensed consolidated financial statements.

​

​

5

Table of Contents

Profound Medical Corp.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

1 Description of business and liquidity risk

Profound Medical Corp. (Profound) and its subsidiaries (together, the Company) were incorporated under the Ontario Business Corporations Act on July 16, 2014. The Company is a commercial-stage medical device company focused on the development and marketing of customizable, incision-free therapeutic systems for the ablation of diseased tissue utilizing platform technologies.

The Company’s registered address is 2400 Skymark Avenue, Unit 6, Mississauga, Ontario, Canada, L4W 5K5.

Liquidity

As of June 30, 2025, we had cash of $35,195 compared to $54,912 as of December 31, 2024. Historically, our primary source of cash has been financing activities, e.g., equity offerings as well as the CIBC Credit Agreement.

Based on our current operating plans, we expect that our existing cash and sales of our products and services will enable us to fund our operating expenses and capital expenditure requirements for at least the next 12 months from the date of the issuance of these unaudited condensed consolidated financial statements. During that time, we expect that our expenses will increase, primarily due to the continued commercialization of TULSA-PRO and Sonalleve. We have based these estimates on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we expect. The Company’s ability to accomplish all of its future strategic plans is dependent on obtaining additional financing or executing other strategic options by the third quarter of the year ending December 31, 2026; however, there is no assurance the Company will achieve these objectives.

​

2 | Summary of significant accounting policies

Basis of preparation

The Company prepares its condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States (US GAAP). The condensed consolidated financial statements include the accounts of wholly owned subsidiaries, after elimination of intercompany accounts and transactions. The consolidated financial information presented herein reflects all financial information that, in the opinion of management, is necessary for a fair statement of financial position, results of operations and cash flows for the periods presented.

Unaudited condensed consolidated financial statements

The condensed consolidated balance sheet as of June 30, 2025, the condensed consolidated statements of operations and comprehensive loss and of shareholders’ equity for the three and six months ended June 30, 2025 and 2024, and the condensed consolidated statements of cash flows for the six months ended June 30, 2025 and 2024, are unaudited. The financial data and other information disclosed in these notes to the financial statements related to June 30, 2025, and the three and six months ended June 30, 2025 and 2024, are also unaudited. The accompanying condensed consolidated balance sheet as of December 31, 2024 has been derived from the audited consolidated financial statements included in the Annual Report on Form 10-K (“Annual Report”) filed with the Securities and Exchange Commission on March 7, 2025.

The unaudited condensed consolidated financial statements have been prepared on the same basis as the annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to a fair statement of the Company’s financial position as of June 30, 2025, and the results of its operations and cash flows for the three and six months ended June 30, 2025 and 2024. The results for the three and six months ended June 30, 2025, are not necessarily indicative of results to be expected for the year ending December 31, 2025, or for any other period or for any future year and should be read in conjunction with the annual consolidated financial statements included in the Annual Report.

6

Table of Contents

Use of estimates

The preparation of the Company’s unaudited condensed consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Significant estimates and assumptions reflected in these unaudited condensed consolidated financial statements include, but are not limited to, assumptions related to the valuation of inventory, the determination of the amortized cost of trade and other receivables, determination of expected credit loss, and the valuation of stock options. The Company based its estimates on historical experience, known trends and other market-specific or other relevant factors that it believes to be reasonable under the circumstances. On an ongoing basis, management evaluates its estimates when there are changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. Actual results could differ from those estimates.

Recent Accounting Pronouncements

The FASB issued ASU 2024-03 in November 2024 and ASU 2025-01 in January 2025 clarifying the effective date of ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, an accounting standard update to improve income statement expenses disclosures. The standard requires more detailed information related to the types of expenses, including (among other items) the amounts of purchases of inventory, employee compensation, depreciation and intangible asset amortization included within each interim and annual income statement’s expense caption, as applicable. This authoritative guidance can be applied prospectively or retrospectively and will be effective for fiscal years beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the effect of this pronouncement on its disclosures.

​

3 | Trade and other receivables, net

Trade receivables and other receivables, net, as of June 30, 2025 and December 31, 2024 consists of the following:

​

​ | ​ | ​ | ​ | ​
​ | ​ | June 30, | ​ | December 31,
​ |  | 2025 |  | 2024
​ | ​ | $ | ​ | $
Trade receivables, gross |  | 4,114 |  | 5,245
Contract assets, gross | ​ | 596 | ​ | 1,340
Trade receivables and contract assets | ​ | 4,710 | ​ | 6,585
Allowance for expected credit losses |  | (531) |  | (158)
Trade receivables, net |  | 4,179 |  | 6,427
Tax receivables |  | 557 |  | 308
Other receivables |  | 162 |  | 310
Total trade and other receivables, net |  | 4,898 |  | 7,045

​

The activity in the allowance for expected credit losses for trade receivables and contract assets was as follows:

​

​ | ​ | ​ | ​ | ​
​ |  | June 30, |  | December 31,
​ | ​ | 2025 | ​ | 2024
​ | ​ | $ | ​ | $
Balance - Beginning of the period | ​ | 158 | ​ | 76
Provision for allowance for expected credit losses | ​ | 373 | ​ | 82
Balance - End of the period | ​ | 531 | ​ | 158

​

​

7

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4 | Inventory

Inventory as of June 30, 2025 and December 31, 2024 consists of the following:

​

​ | ​ | ​ | ​ | ​
​ | ​ | June 30, | ​ | December 31,
​ |  | 2025 |  | 2024
​ | ​ | $ | ​ | $
Finished goods |  | 5,621 |  | 3,837
Raw materials |  | 2,732 |  | 1,964
Inventory |  | 8,353 |  | 5,801

​

During the three and six months ended June 30, 2025, $496 and $1,156, respectively (three and six months ended June 30, 2024 - $751 and $1,188) of inventory was recognized in cost of sales.

​

5 | Property and equipment, net

The major components of property and equipment, net, as of June 30, 2025 and December 31, 2024 consist of the following:

​

​ | ​ | ​ | ​ | ​
​ | ​ | June 30, | ​ | December 31,
​ |  | 2025 |  | 2024
​ | ​ | $ | ​ | $
Leasehold improvements |  | 542 |  | 542
Equipment under operating lease |  | 1,640 |  | 2,273
Total |  | 2,182 |  | 2,815
Accumulated depreciation |  | (1,904) |  | (2,390)
Property and equipment, net |  | 278 |  | 425

​

Depreciation expense for the three and six months ended June 30, 2025 was $102 and $218, respectively (three and six months ended June 30, 2024 - $184 and $383). During the three and six months ended June 30, 2025, the Company sold $135 and $213, respectively (three and six months ended June 30, 2024 - $nil and $nil) of equipment under operating lease to a customer.

​

6 | Intangible assets

The major components of intangible assets as of June 30, 2025 and December 31, 2024 consist of:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | June 30, 2025 | ​ | December 31, 2024
​ | ​ | ​ | ​ | $ | ​ | $
​ |  | Weighted |  | ​ |  | ​ |  | ​ |  | ​ |  | ​ |  | ​
​ | ​ | Average | ​ | ​ | ​ |  | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Remaining | ​ | ​ | ​ | Accumulated | ​ |  | ​ |  |  | Accumulated |  | ​
​ | ​ | Useful | ​ | Gross | ​ | Amortization | ​ | Net | ​ | Gross | ​ | Amortization | ​ | Net
​ | ​ | Lives | ​ | Carrying | ​ | and | ​ | Carrying | ​ | Carrying | ​ | and | ​ | Carrying
​ | ​ | (Years) | ​ | Amount | ​ | Impairments |  | Amount | ​ | Amount | ​ | Impairments | ​ | Amount
Exclusive license agreement | ​ | 4.2 | ​ | 231 | ​ | (148) | ​ | 83 | ​ | 231 | ​ | (142) | ​ | 89
Software | ​ | 0.6 | ​ | 978 | ​ | (886) | ​ | 92 | ​ | 978 | ​ | (806) | ​ | 172
​ | ​ | ​ | ​ | 1,209 | ​ | (1,034) | ​ | 175 | ​ | 1,209 | ​ | (948) | ​ | 261

​

The Company has a license agreement (the license) with Sunnybrook Health Sciences Centre (Sunnybrook), pursuant to which Sunnybrook licenses to the Company certain intellectual property and exclusively licensed-in rights that enable the Company to use Sunnybrook’s technology for MRI-guided trans-urethral ultrasound therapy. The Company has the option to acquire rights to improvements to the relevant technology and intellectual property. If the Company fails to comply with any of its obligations or otherwise breaches this agreement, Sunnybrook may have the right to terminate the license.

​

8

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7 | Accrued expenses and other current liabilities

Accrued expenses and other current liabilities as of June 30, 2025 and December 31, 2024 consist of the following:

​

​ | ​ | ​ | ​ | ​
​ | ​ | June 30, | ​ | December 31,
​ |  | 2025 |  | 2024
​ | ​ | $ | ​ | $
Accrued employee compensation | ​ | 2,000 | ​ | 706
Clinical trials | ​ | 1,293 | ​ | 325
Other general accruals | ​ | 509 | ​ | 1,804
Accrued expenses and other current liabilities | ​ | 3,802 | ​ | 2,835

​

​

8 | Long-term debt

On March 3, 2025, the Company entered into an amended and restated credit agreement with CIBC (the “CIBC Credit Agreement”), which amended the terms of the CIBC Loan and the existing long-term debt provided under the Original CIBC Credit Agreement was repaid with proceeds from a new revolving line of credit provided by CIBC to Profound. This was accounted for as a modification of debt whereby a new effective interest rate was established based on the carrying value of the debt and the revised cash flows. The line of credit bears interest at the Wall Street Journal Prime Rate subject to a floor of 6.25%. The CIBC Credit Agreement contains financial covenants whereby unrestricted cash is at all times greater than EBITDA for the most recent nine-month period, reported on a monthly basis and that revenue for the 12 month period must be 15% greater than revenue for the same time period in the prior fiscal year, reported on a quarterly basis. The obligations are secured by, inter alia, a general security agreement over the assets and the assets of the Company’s subsidiaries. The revolving line of credit matures on March 3, 2027 and provides an option to the Company to increase the amount of the revolving commitment by $5,000 within 18 months from March 3, 2025, subject to achieving a minimum trailing 12 month revenue exceeding $15,000. The exercise of the option would result in the size of the revolving commitment increasing from $10,000 to a maximum of $15,000. Additionally, the CIBC Credit Agreement provides that Profound may request a one-time increase in the principal amount of the revolving line of credit up to a maximum amount of $10,000, which is subject to the approval of CIBC in its sole discretion. The Company is in compliance with these financial covenants as at June 30, 2025. Future compliance with the financial covenants included in the CIBC Credit Agreement is dependent upon achieving certain revenue, EBITDA, and anticipated cash levels.

As per the Company’s most recent forecasts, the Company projects to be in violation of one of its covenants under the CIBC Credit Agreement by December 31, 2025, where unrestricted cash will no longer exceed the required liquidity amount for the most recent nine-month period. As per the terms of the CIBC Credit Agreement, based on this projected breach, CIBC may exercise the right to declare the outstanding debt obligation as immediately due and payable. Management has evaluated the significance of this event and has concluded that, if a waiver cannot be obtained from CIBC for the violation, the Company will have sufficient unrestricted cash to repay the total remaining outstanding debt obligation that may become due.

​

​ | ​ | ​ | ​ | ​
​ | ​ | June 30, | ​ | December 31,
​ |  | 2025 |  | 2024
​ | ​ | $ | ​ | $
Balance - Beginning of period | ​ | 4,661 | ​ | 7,104
Interest expense | ​ | 190 | ​ | 600
Interest paid | ​ | (139) | ​ | (582)
Foreign exchange | ​ | 40 | ​ | (483)
Repayment | ​ | (290) | ​ | (1,978)
Balance - End of period | ​ | 4,462 | ​ | 4,661
Less: Current portion | ​ | — | ​ | 1,737
Long-term portion | ​ | 4,462 | ​ | 2,924

​

​

9

Table of Contents

9 | Share capital

Common shares

The Company is authorized to issue an unlimited number of common shares.

​

​ | ​ | ​ | ​ | ​
​ |  | June 30, |  | December 31,
​ | ​ | 2025 | ​ | 2024
Issued and outstanding (with no par value) | ​ | $ | ​ | $
30,053,142 (December 31, 2024 – 30,039,809) common shares | ​ | 281,641 | ​ | 281,552

​

Voting Power

Except as otherwise required by law, the holders of common shares possess all voting power for the election of the Company’s directors and all other matters requiring shareholder action. Holders of common shares are entitled to one vote per share on matters to be voted on by shareholders.

Dividends

Holders of common shares will be entitled to receive such dividends, if any, as may be declared from time to time by the Company’s board of directors in its discretion out of funds legally available therefor. In no event will any stock dividends or stock splits or combinations of stock be declared or made on common stock unless the shares of common stock at the time outstanding are treated equally and identically.

Liquidation, Dissolution and Winding Up

In the event of the Company’s voluntary or involuntary liquidation, dissolution, distribution of assets or winding-up, the holders of the common stock will be entitled to receive an equal amount per share of all of the Company’s assets of whatever kind available for distribution to shareholders, after the rights of the creditors have been satisfied.

​

10 | Share-based payments

Share options

Effective May 20, 2020, the Company adopted amendments to the share option plan (the Share Option Plan). The maximum number of common shares reserved for issuance under the share option plan and the long-term incentive plan is 3,905,175 common shares or such other number as may be approved by the holders of the voting shares of the Company.

As at June 30, 2025, 2,147,568 (December 31, 2024 – 2,291,152) options are outstanding. Each share option granted allows the holder to purchase one common share, at an exercise price not less than the lesser of the closing trading price of the common shares on the TSX (or other exchange where the common shares are listed), on the date a share option is granted and the volume-weighted average price of the common shares for the five trading days immediately preceding the date the share option is granted. Share options granted under the Share Option Plan generally have a maximum term of ten years and vest over a period of up to four years.

10

Table of Contents

A summary of the share option activity during the period presented and the total number of share options outstanding as at those dates are set forth below:

​

​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | Weighted average
​ | ​ | Number | ​ | exercise price
​ |  | of options |  | C$
Balance - December 31, 2024 |  | 2,291,152 |  | 14.13
Granted |  | 54,100 |  | 6.87
Forfeited/expired |  | (197,684) |  | 17.77
Balance - June 30, 2025 |  | 2,147,568 |  | 13.61
Exercisable - June 30, 2025 |  | 1,187,803 |  | 15.77
Expected to vest - June 30, 2025 |  | 2,147,568 |  | 13.61

​

The Company estimated the fair value of the share options granted during the period using the Black-Scholes option pricing model with the weighted average assumptions below. The Company estimated the expected future stock price volatility for its common stock by using its historical volatility based on daily price observations for the most recent historical period equal to the length of the instrument’s expected life of options.

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | March 19, | ​ | May 20, | ​ | June 13, | ​
Grant date |  | 2025 | ​ | 2025 | ​ | 2025 |
Exercise price |  | C$9.87 | ​ | C$6.28 | ​ | C$8.78 | ​
Expected volatility |  | 68 | % | 68 | % | 69 | %
Expected life of options |  | 6 years | ​ | 6 years | ​ | 6 years | ​
Risk-free interest rate |  | 2.85 | % | 2.98 | % | 3.06 | %
Dividend yield |  | — | ​ | — | ​ | — | ​

​

​

The weighted average grant date fair values of share options granted for the three and six months ended June 30, 2025 were C$4.59 and C$4.82, respectively (three and six months ended June 30, 2024 - C$7.01 and C$7.01).

Long-term incentive plan

Effective May 17, 2023, the Company adopted the amended long term incentive plan (the LTIP). The LTIP is an incentive-based equity compensation plan that provides for the grant of restricted share units (the RSUs) and deferred share units (the DSUs, together with the RSUs, the Units). The maximum number of units which may be reserved for issuance under this LTIP in respect of grants of RSUs and DSUs shall not exceed 4.9% of the issued and outstanding common shares on a non-diluted basis, provided that, the maximum number of shares which may be reserved for issuance pursuant to all of the Company’s security-based compensation arrangements shall not in the aggregate exceed 13% of the issued and outstanding common shares on a non-diluted basis. The Company may grant Units to officers, directors or employees of the Company. Each Unit represents the right to receive one common share in accordance with the terms of the LTIP. The number of Units granted at any particular time will be calculated by dividing the dollar amount of such grant by the market value of a common share on the applicable grant date, which is equal to the volume weighted average trading price of all common shares traded on the TSX (or other exchange where the Common Shares are listed) for the five trading days immediately preceding such date. RSUs and DSUs granted under the LTIP vest over a period of up to three years.

11

Table of Contents

The following table summarizes RSUs activities:

​

​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | Weighted
​ | ​ | ​ | ​ | average grant
​ | ​ | ​ | ​ | date fair value
​ | ​ | Number of | ​ | per share
​ |  | RSUs |  | C$
Balance - December 31, 2024 |  | 324,621 |  | 11.18
Granted |  | 801,000 | ​ | 9.26
Vested |  | (13,333) | ​ | 11.27
Forfeited |  | (36,834) | ​ | 9.83
Balance - June 30, 2025 |  | 1,075,454 | ​ | 9.80

​

A summary of the DSUs changes during the period are set forth below:

​

​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | Weighted
​ | ​ | ​ | ​ | average grant
​ | ​ | ​ | ​ | date fair value
​ | ​ | Number of | ​ | per share
​ |  | DSUs |  | C$
Balance - December 31, 2024 |  | 91,670 |  | 10.40
Granted |  | 60,485 | ​ | 8.49
Balance - June 30, 2025 |  | 152,155 | ​ | 9.64

​

Share-based compensation expense

The following table presents the components and classification of share-based compensation recognized for share options, RSUs, and DSUs for the three and six months ended June 30, 2025 and 2024:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended June 30, | ​ | Six Months Ended June 30,
​ | ​ | 2025 | ​ | 2024 | ​ | 2025 | ​ | 2024
​ |  | $ |  | $ |  | $ |  | $
Share options |  | 125 | ​ | 129 | ​ | 758 |  | 298
RSUs |  | 627 | ​ | 528 | ​ | 869 |  | 1,017
DSUs |  | 699 | ​ | 111 | ​ | 813 |  | 220
Share-based compensation |  | 1,451 | ​ | 768 | ​ | 2,440 |  | 1,535
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Cost of sales |  | 7 | ​ | 15 | ​ | 10 |  | 30
Research and development |  | 315 | ​ | 156 | ​ | 588 |  | 323
Selling, general and administrative |  | 1,129 | ​ | 597 | ​ | 1,842 |  | 1,182
Share-based compensation |  | 1,451 | ​ | 768 | ​ | 2,440 |  | 1,535

​

​

​

11 | Revenue

The following table provides information about disaggregated revenue by products and services:

​

​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | For the three months ended June 30, 2025
​ | ​ | Contracts with | ​ | ​ | ​ | ​
​ | ​ | customers | ​ | Leasing | ​ | Total
​ |  | $ |  | $ |  | $
Revenue |  |  |  |  |  |
Recurring - non-capital |  | 1,331 |  | 230 |  | 1,561
Capital equipment |  | 650 |  | — |  | 650
​ |  | 1,981 |  | 230 |  | 2,211

​

​

12

Table of Contents

​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | For the three months ended June 30, 2024
​ | ​ | Contracts with | ​ | ​ | ​ | ​
​ | ​ | customers | ​ | Leasing | ​ | Total
​ |  | $ |  | $ |  | $
Revenue | ​ | ​ | ​ | ​ | ​ | ​
Recurring - non-capital | ​ | 1,180 | ​ | 280 | ​ | 1,460
Capital equipment | ​ | 773 | ​ | — | ​ | 773
​ | ​ | 1,953 | ​ | 280 | ​ | 2,233

​

​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | For the six months ended June 30, 2025
​ | ​ | Contracts with | ​ | ​ | ​ | ​
​ | ​ | customers | ​ | Leasing | ​ | Total
​ |  | $ |  | $ |  | $
Revenue |  |  |  |  |  |
Recurring - non-capital |  | 2,852 |  | 510 |  | 3,362
Capital equipment |  | 1,470 |  | — |  | 1,470
​ |  | 4,322 |  | 510 |  | 4,832

​

​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | For the six months ended June 30, 2024
​ | ​ | Contracts with | ​ | ​ | ​ | ​
​ | ​ | customers | ​ | Leasing | ​ | Total
​ |  | $ |  | $ |  | $
Revenue |  |  |  |  |  |
Recurring - non-capital |  | 2,399 |  | 500 |  | 2,899
Capital equipment |  | 773 |  | — |  | 773
​ |  | 3,172 |  | 500 |  | 3,672

​

​

12 | Loss per share

The following table shows the calculation of basic and diluted loss per share:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Three Months Ended June 30, | ​ | Six Months Ended June 30,
​ | ​ | 2025 |  | 2024 |  | 2025 |  | 2024
​ | ​ | $ | ​ | $ | ​ | $ | ​ | $
Net loss for the period |  | ​ | 15,695 | ​ | $ | 6,919 | ​ | ​ | 26,419 |  | $ | 13,504
Weighted average number of common shares |  | ​ | 30,053,142 | ​ | ​ | 24,440,444 | ​ | ​ | 30,055,047 |  | ​ | 24,373,869
Basic and diluted loss per share |  | $ | 0.52 | ​ | $ | 0.28 | ​ | $ | 0.88 |  | $ | 0.55

​

The computation of diluted loss per share is equal to the basic loss per share due to the anti-dilutive effect of the share options, RSUs and DSUs. Of the 2,147,568 (June 30, 2024 – 1,481,408) share options, 1,075,454 (June 30, 2024 – 458,895) RSUs, and 152,155 (June 30, 2024 – 75,000) DSUs are not included in the calculation of diluted loss per share for the period ended June 30, 2025, 1,187,803 (June 30, 2024 – 1,319,783) were exercisable.

​

13 | Segment reporting

The Company’s operations are categorized into one industry segment, which is medical technology focused on magnetic resonance guided ablation procedures for the treatments to ablate the prostate gland, uterine fibroids, osteoid osteoma and nerves for palliative pain relief for patients with metastatic bone disease. The CODM regularly reviews the operating results of the Company on a consolidated basis as part of making decisions for allocating resources and evaluating performance. Further, the CODM is regularly provided with the consolidated expenses as noted on the consolidated statements of operations and comprehensive loss.

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The following tables represent total revenue by geographic area, based on the location of the location of the reporting entity for the three and six months ended June 30, 2025 and 2024, respectively:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | For the three months ended June 30, 2025
​ | ​ | Canada | ​ | USA | ​ | Germany | ​ | Total
​ |  | $ |  | $ |  | $ |  | $
Revenue | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Recurring - non-capital | ​ | 94 | ​ | 1,327 | ​ | 140 | ​ | 1,561
Capital equipment | ​ | — | ​ | 650 | ​ | — | ​ | 650
​ | ​ | 94 | ​ | 1,977 | ​ | 140 | ​ | 2,211

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | For the three months ended June 30, 2024
​ | ​ | Canada | ​ | USA | ​ | Germany | ​ | Total
​ |  | $ |  | $ |  | $ |  | $
Revenue |  | ​ |  | ​ | ​ | ​ |  | ​
Recurring - non-capital | ​ | 99 | ​ | 1,101 | ​ | 260 | ​ | 1,460
Capital equipment |  | 773 |  | — | ​ | — |  | 773
​ |  | 872 |  | 1,101 | ​ | 260 |  | 2,233

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | For the six months ended June 30, 2025
​ | ​ | Canada | ​ | USA | ​ | Germany | ​ | Total
​ |  | $ |  | $ |  | $ |  | $
Revenue |  | ​ |  | ​ | ​ | ​ |  | ​
Recurring - non-capital | ​ | 376 | ​ | 2,620 | ​ | 366 | ​ | 3,362
Capital equipment |  | 570 |  | 900 | ​ | — |  | 1,470
​ |  | 946 |  | 3,520 | ​ | 366 |  | 4,832

​

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | For the six months ended June 30, 2024
​ | ​ | Canada | ​ | USA | ​ | Germany | ​ | Total
​ |  | $ |  | $ |  | $ |  | $
Revenue |  | ​ |  | ​ | ​ | ​ |  | ​
Recurring - non-capital | ​ | 203 | ​ | 2,259 | ​ | 437 | ​ | 2,899
Capital equipment |  | 773 |  | — | ​ | — |  | 773
​ |  | 976 |  | 2,259 | ​ | 437 |  | 3,672

​

The following tables represent other geographic information for the six months ended June 30, 2025 and the year ended December 31, 2024:

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | For the period ended June 30, 2025
​ | ​ | Canada | ​ | USA | ​ | Germany | ​ | China | ​ | Finland | ​ | Total
​ |  | $ |  | $ |  | $ |  | $ |  | $ |  | $
Total assets |  | 38,180 |  | 6,802 |  | 1,502 |  | 60 |  | 3,124 |  | 49,668
Intangible assets |  | 175 |  | — |  | — |  | — |  | — |  | 175
Property and equipment |  | 69 |  | 209 |  | — |  | — |  | — |  | 278
Right-of-use assets |  | 303 |  | — |  | — |  | — |  | — |  | 303
Amortization of intangible assets |  | 86 |  | — |  | — |  | — |  | — |  | 86
Depreciation of property and equipment |  | 23 |  | 195 |  | — |  | — |  | — |  | 218

​

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | For the year ended December 31, 2024
​ | ​ | Canada | ​ | USA | ​ | Germany | ​ | China | ​ | Finland | ​ | Total
​ |  | $ |  | $ |  | $ |  | $ |  | $ |  | $
Total assets |  | 58,743 |  | 6,351 |  | 1,661 |  | 92 |  | 3,387 |  | 70,234
Intangible assets |  | 261 |  | — |  | — |  | — |  | — |  | 261
Property and equipment |  | 93 |  | 332 |  | — |  | — |  | — |  | 425
Right-of-use assets |  | 396 |  | — |  | — |  | — |  | — |  | 396
Amortization of intangible assets |  | 229 |  | — |  | — |  | — |  | — |  | 229
Depreciation of property and equipment |  | 66 |  | 641 |  | — |  | — |  | — |  | 707

​

​

​

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​

​

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

As used in this Quarterly Report on Form 10-Q, the “Company”, the “Registrant”, “we” or “us” refer to Profound Medical Corp. The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and related notes that appear elsewhere in this report. In addition to historical financial information, the following discussion contains forward-looking statements that reflect our plans, estimates, assumptions and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to these differences include those discussed in the Risk Factors section of the Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 7, 2025 (the “2024 Annual Report”), and elsewhere in this report under “Part II, Other Information—Item 1A, Risk Factors.” Forward-looking statements include information concerning our possible or assumed future results of operations, business strategies and operations, financing plans, potential growth opportunities, potential market opportunities, potential results of our development efforts or trials, and the effects of competition. Forward-looking statements include all statements that are not historical facts and can be identified by terms such as “anticipates,” “believes,” “could,” “seeks,” “estimates,” “expects,” “intends,” “may,” “plans,” “potential,” “predicts,” “projects,” “should,” “will,” “would” or similar expressions and the negatives of those terms. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Also, forward-looking statements represent our management’s plans, estimates, assumptions and beliefs only as of the date of this report. Except as required by law, we assume no obligation to update these forward-looking statements publicly or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future. Unless stated otherwise, all references to “$” are to United States dollars in thousands and all references to “C$” are to Canadian dollars in thousands.

Overview

We are a commercial-stage medical device company focused on the development and marketing of customizable, incision-free therapeutic systems for the image guided ablation of diseased tissue utilizing its platform technologies and leveraging the healthcare system’s existing imaging infrastructure. Our lead product (the “TULSA-PRO system”) combines real-time MRI, robotically driven transurethral sweeping-action thermal ultrasound with closed-loop temperature feedback control for the ablation of prostate tissue. The product is comprised of one-time-use devices and durable equipment that are used in conjunction with a customer’s existing MRI scanner.

We are commercializing TULSA-PRO, a technology that combines real-time MRI, robotically-driven transurethral ultrasound and closed-loop temperature feedback control. The TULSA procedure, performed using the TULSA-PRO system, has the potential of becoming a mainstream treatment modality across the entire prostate disease spectrum; ranging from low-, intermediate-, or high-risk prostate cancer; to hybrid patients suffering from both prostate cancer and benign prostatic hyperplasia (“BPH”); to men with BPH only; and also, to patients requiring salvage therapy for radio-recurrent localized prostate cancer. TULSA employs real-time MR guidance for pixel-by-pixel precision to preserve prostate disease patients’ urinary continence and sexual function, while killing the targeted prostate tissue via a precise sound absorption technology that gently heats it to kill temperature (55-57°C). TULSA is an incision- and radiation-free “one-and-done” procedure performed in a single session that takes a few hours. Virtually all prostate shapes and sizes can be safely, effectively, and efficiently treated with TULSA. There is no bleeding associated with the procedure; no hospital stay is required; and most TULSA patients report quick recovery to their normal routine. TULSA-PRO is CE marked, Health Canada approved, and 510(k) cleared by the U.S. Food and Drug Administration (“FDA”).

We are also commercializing Sonalleve, an innovative therapeutic platform that is CE marked for the treatment of uterine fibroids and palliative pain treatment of bone metastases. Sonalleve has also been approved by the China National Medical Products Administration for the non-invasive treatment of uterine fibroids and has FDA approval under a Humanitarian Device Exemption for the treatment of osteoid osteoma. We are in the early stages of exploring additional potential treatment markets for Sonalleve where the technology has been shown to have clinical application, such as non-invasive ablation of abdominal cancers and hyperthermia for cancer therapy.

We deploy a hybrid recurring revenue business model in the United States to market TULSA-PRO, i) charging a one-time payment that includes a supply of our one-time-use device, use of the system as well as our Genius services that support each TULSA center with clinical and patient recruitment and ii) a traditional model of charging for the system separately as capital and an additional per patient charge for the one-time-use devices and associated Genius services. The Sonalleve product is marketed primarily outside North America in European and Asian countries, deploying a capital sales model. Outside of North America, we generate most of our

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revenues from our system sales in Europe and Asia, where we deploy a more traditional hybrid business model, charging for the system separately as a capital sale and an additional per patient charge for the one-time-use devices and associated Genius services.

Results of Operations

Comparison of Three and Six Months Ended June 30, 2025 and 2024

The following selected financial information as at and for the three and six months ended June 30, 2025 and 2024 have been derived from the unaudited consolidated financial statements and should be read in conjunction with those unaudited consolidated financial statements and related notes.

​ | ​ | ​ | ​ | ​
​ |  | For the six months ended June 30,
​ | ​ | 2025 |  | 2024
​ | ​ | $ | ​ | $
Revenue | ​ | 4,832 | ​ | 3,672
Operating expenses | ​ | 28,443 | ​ | 18,006
Other (income) expense | ​ | 1,342 | ​ | (2,274)
Net loss for the period | ​ | 26,419 | ​ | 13,504
Basic and diluted loss per share | ​ | 0.88 | ​ | 0.55

​

​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | For the three months ended June 30, | ​
​ | ​ | 2025 | ​ | 2024 | ​ | Change |
​ | ​ | $ |  | $ |  | $ |  | % |
Revenue | ​ | 2,211 | ​ | 2,233 | ​ | (22) | ​ | (1) | %
Cost of sales |  | 593 | ​ | 812 | ​ | (219) | ​ | (27) | %
Gross profit |  | 1,618 | ​ | 1,421 | ​ | 197 | ​ | 14 | %
Gross margin | ​ | 73 | % | 64 | % | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Expenses |  | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Research and development |  | 6,098 | ​ | 4,205 | ​ | 1,893 | ​ | 45 | %
Selling, general and administrative |  | 9,326 | ​ | 5,058 | ​ | 4,268 | ​ | 84 | %
Total operating expenses |  | 15,424 | ​ | 9,263 | ​ | 6,161 | ​ | 67 | %
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Other (income) expense |  | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net finance (income) expense |  | (343) | ​ | (422) | ​ | 79 | ​ | (19) | %
Net foreign exchange (gain) loss |  | 2,168 |  | (520) |  | 2,688 |  | (517) | %
Total other (income) expense |  | 1,825 | ​ | (942) | ​ | 2,767 | ​ | (294) | %
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net loss before income taxes |  | 15,631 | ​ | 6,900 | ​ | 8,731 | ​ | 127 | %
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Income taxes |  | 64 | ​ | 19 | ​ | 45 | ​ | 237 | %
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net loss attributed to shareholders for the period |  | 15,695 | ​ | 6,919 | ​ | 8,776 | ​ | 127 | %
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Other comprehensive (income) loss |  | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Item that may be reclassified to profit or loss |  | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Foreign currency translation adjustment |  | (2,713) | ​ | 470 | ​ | (3,183) | ​ | (677) | %
Net loss and comprehensive loss for the period |  | 12,982 | ​ | 7,389 | ​ | 5,593 | ​ | 76 | %
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Loss per share |  | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Basic and diluted net loss per common share |  | 0.52 | ​ | 0.28 | ​ | 0.24 | ​ | 86 | %
Basic and diluted weighted average common share outstanding |  | 30,053,142 | ​ | 24,440,444 | ​ | ​ | ​ | ​ | ​

​

​

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​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | For the six months ended June 30, | ​
​ |  | 2025 | ​ | 2024 | ​ | Change | ​
​ | ​ | $ |  | $ |  | $ |  | % | ​
Revenue | ​ | 4,832 | ​ | 3,672 | ​ | 1,160 | ​ | 32 | %
Cost of sales | ​ | 1,361 | ​ | 1,385 | ​ | (24) | ​ | (2) | %
Gross profit | ​ | 3,471 | ​ | 2,287 | ​ | 1,184 | ​ | 52 | %
Gross margin | ​ | 72 | % | 62 | % |  | ​ |  | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Expenses | ​ |  | ​ |  | ​ |  | ​ |  | ​
Research and development | ​ | 10,906 | ​ | 8,150 | ​ | 2,756 | ​ | 34 | %
Selling, general and administrative | ​ | 17,537 | ​ | 9,856 | ​ | 7,681 | ​ | 78 | %
Total operating expenses | ​ | 28,443 | ​ | 18,006 | ​ | 10,437 | ​ | 58 | %
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Other (income) expense | ​ |  | ​ |  | ​ |  | ​ |  | ​
Net finance (income) expense | ​ | (788) | ​ | (884) | ​ | 96 | ​ | (11) | %
Net foreign exchange (gain) loss | ​ | 2,130 | ​ | (1,390) | ​ | 3,520 | ​ | (253) | %
Total other (income) expense | ​ | 1,342 | ​ | (2,274) | ​ | 3,616 | ​ | (159) | %
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net loss before income taxes | ​ | 26,314 | ​ | 13,445 | ​ | 12,869 | ​ | 96 | %
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Income taxes | ​ | 105 | ​ | 59 | ​ | 46 | ​ | 78 | %
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Net loss attributed to shareholders for the period | ​ | 26,419 | ​ | 13,504 | ​ | 12,915 | ​ | 96 | %
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Other comprehensive (income) loss | ​ |  | ​ |  | ​ |  | ​ |  | ​
Item that may be reclassified to profit or loss | ​ |  | ​ |  | ​ |  | ​ |  | ​
Foreign currency translation adjustment | ​ | (2,816) | ​ | 1,439 | ​ | (4,255) | ​ | (296) | %
Net loss and comprehensive loss for the period | ​ | 23,603 | ​ | 14,943 | ​ | 8,660 | ​ | 58 | %
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Loss per share | ​ |  | ​ |  | ​ |  | ​ |  | ​
Basic and diluted net loss per common share | ​ | 0.88 | ​ | 0.55 | ​ | 0.33 | ​ | 60 | %
Basic and diluted weighted average common share outstanding | ​ | 30,055,047 | ​ | 24,373,869 | ​ |  | ​ |  | ​

​

Key Components of Our Results of Operations

Revenue

We deploy a hybrid recurring revenue business model in the United States to market TULSA-PRO, i) charging a one-time payment that includes a supply of our one-time-use device, use of the system as well as our Genius services that support each TULSA center with clinical and patient recruitment and ii) a traditional model of charging for the system separately as capital and an additional per patient charge for the one-time-use devices and associated Genius services. The Sonalleve product is marketed primarily outside North America in European and Asian countries deploying a one-time capital sales model with limited recurring service revenue. Outside of North America, we generate most of our revenues from our system sales (both TULSA-PRO and Sonalleve) in Europe and Asia where we deploy a more traditional hybrid business model, charging for the system separately as capital and an additional per patient charge for the one-time-use devices and associated Genius services. Revenue is comprised of recurring – non-capital revenue, which consists of the sale of one-time-use devices, lease of medical devices, procedures and services associated with extended warranties and capital equipment, which is the one-time sale of capital equipment.

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For the three months ended June 30, 2025, we recorded revenue totaling $2,211, consisting of $650 from the one-time sale of capital equipment and $1,561 from recurring – non-capital revenue. For the three months ended June 30, 2024, we recorded revenue totaling $2,233, consisting of $773 from the one-time sale of capital equipment and $1,460 from recurring – non-capital revenue. The decrease of $22, or -1%, in revenue for the three months ended June 30, 2025 compared to the three months ended June 30, 2024 was mainly driven by a reduction in capital sales during the period, which was partially offset by higher recurring revenue in the United States.

For the six months ended June 30, 2025, we recorded revenue totaling $4,832, consisting of $1,470 from the one-time sale of capital equipment and $3,362 from recurring – non-capital revenue. For the six months ended June 30, 2024, we recorded revenue totaling $3,672, consisting of $773 from the one-time sale of capital equipment and $2,899 from recurring – non-capital revenue. The increase of $1,160, or 32%, in revenue for the six months ended June 30, 2025 compared to the six months ended June 30, 2024 was the result of higher recurring revenue in the United States and capital sales overseas.

Cost of Sales

Cost of sales primarily includes the cost of finished goods, depreciation of equipment under lease, inventory write-downs, royalties, warranty expenses, freight and direct overhead and labor expenses necessary to acquire or manufacture the finished goods.

For the three months ended June 30, 2025, we recorded a cost of sales of $593, which reflects a 73% gross profit. For the three months ended June 30, 2024, we recorded a cost of sales of $812, which reflects a 64% gross profit. The decrease of $219, or -27%, in cost of sales for the three months ended June 30, 2025 compared to the three months ended June 30, 2024 was the result of capital equipment buy outs by existing customers which have higher margins. The gross profit was higher in the three months ended June 30, 2025 by $197, or 14%, due to manufacturing operating at higher efficiency rates based on improvements that have been implemented.

For the six months ended June 30, 2025, we recorded a cost of sales of $1,361, which reflects a 72% gross profit. For the six months ended June 30, 2024, we recorded a cost of sales of $1,385, which reflects a 62% gross profit. The decrease of $24, or -2%, in cost of sales for the six months ended June 30, 2025 compared to the six months ended June 30, 2024 was the result of different product combination whereby more capital equipment was sold which have higher margins. The gross profit was higher in the six months ended June 30, 2025 by $1,184, or 52%, due to manufacturing operating at higher efficiency rates based on improvements that have been implemented and the growth in the number of capital systems sold.

Operating Expenses

Operating expenses consist of two components: research and development (“R&D”) and selling, general and administrative (“SG&A”).

R&D Expenses

R&D expenses are comprised of costs incurred in performing R&D activities, including new product development, continuous product improvement, investment in clinical trials and related clinical manufacturing costs, materials and supplies, salaries and benefits, consulting fees, patent procurement costs, and occupancy costs related to R&D activity.

For the three months ended June 30, 2025, R&D expenses increased by $1,893, or 45%, to $6,098 compared to $4,205 for the three months ended June 30, 2024. The increase in R&D expenses was largely due to increased headcount, increased enrolment for the CAPTAIN trial, treatments and recruitment efforts, and higher travel costs due to patient treatments.

For the six months ended June 30, 2025, R&D expenses increased by $2,756, or 34%, to $10,906 compared to $8,150 for the six months ended June 30, 2024. The increase in R&D expenses was largely due to increased headcount, increased enrolment for the CAPTAIN trial and recruitment efforts, and higher material expenditures due to spending on R&D initiatives to increase compatibility with MRI scanners, reduce design costs and improve efficiencies.

These expenses promote the ongoing development and improvement of the products while further strengthening the commitment to a reliable and customizable product. We continue to make substantial investments in our clinical trial initiatives through research and development and anticipate that the research will continue to support our reimbursement efforts.

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SG&A expenses

Selling, general and administrative expenses are comprised of business development costs related to the market development activities and commercialization of our systems, including salaries and benefits, marketing support functions, occupancy costs, insurance, various management and administrative support functions and other miscellaneous marketing and management costs.

SG&A expenses for the three months ended June 30, 2025 increased by $4,268, or 84%, to $9,326 compared to $5,058 for the three months ended June 30, 2024. The increase in SG&A was driven by increased sales force, commission payments, increased travel and infrastructure costs to support our growth.

SG&A expenses for the six months ended June 30, 2025 increased by $7,681, or 78%, to $17,537 compared to $9,856 for the six months ended June 30, 2024. The increase in SG&A was due to increased sales force, commission payments, increased travel and costs associated with hosting our educational event Pro-Talk Live.

Net finance (income) expense

Net finance (income) expense is primarily comprised of the following: (i) the CIBC Credit Agreement (as defined herein) accreting to the principal amount repayable and its related interest expense; (ii) interest income from cash; (iii) the lease liability interest expense; and (iv) the interest income on trade and other receivables.

Net finance (income) expense decreased $79 to ($343) during the three months ended June 30, 2025, compared to $(422) during the three months ended June 30, 2024. The decrease in net finance (income) expense was due to decrease in interest income from cash.

Net finance (income) expense decreased $96 to ($788) during the six months ended June 30, 2025, compared to $(884) during the six months ended June 30, 2024. The decrease in net finance (income) expense was due to decrease in interest income from cash.

Liquidity and Capital Resources

As of June 30, 2025, we had cash of $35,195 compared to $54,912 as of December 31, 2024. Historically, our primary source of cash has been financing activities, e.g., equity offerings as well as the CIBC Credit Agreement (as defined below).

Based on our current operating plans, we expect that our existing cash and sales of our products and services will enable us to fund our operating expenses and capital expenditure requirements for at least the next 12 months from the date of the issuance of these unaudited condensed consolidated financial statements. During that time, we expect that our expenses will increase, primarily due to the continued commercialization of TULSA-PRO and Sonalleve. We have based these estimates on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we expect. The Company’s ability to accomplish all of its future strategic plans is dependent on obtaining additional financing or executing other strategic options by the third quarter of the year ending December 31, 2026; however, there is no assurance the Company will achieve these objectives.

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Use of Proceeds

2024 Public Offering

We received net proceeds of $36,132 from our public offering completed on December 10, 2024 (the “2024 Public Offering”). We intend to use net proceeds from the 2024 Public Offering to fund the continued commercialization of the TULSA-PRO system in the United States, the continued development and commercialization of the TULSA-PRO system and the SONALLEVE system globally and for working capital and general corporate purposes. In addition, there have been no material adjustments to the cost or timing of the business objective previously disclosed in such prospectus supplement.

​ | ​ | ​
​ | ​ | Total spending of proceeds
​ | ​ | from the 2024 Public
​ | ​ | Offering as of
​ |  | June 30, 2025
​ | ​ | $
TULSA-PRO commercialization | ​ | 18,277
Sonalleve development and commercialization | ​ | 6,092
Working capital and general corporate purposes |  | 4,826
Total |  | 29,195

​

CIBC Loan

We entered into a credit agreement with Canadian Imperial Bank of Commerce (“CIBC”) on November 3, 2022 (the “Original CIBC Credit Agreement”), for gross proceeds of C$10,000, maturing on November 3, 2027, with an interest rate based on CIBC prime plus 2% (the “CIBC Loan”). We were required to make interest-only payments until October 31, 2023, and monthly repayments on the principal of C$208 plus accrued interest commenced on October 31, 2023. All of our obligations under the Original CIBC Credit Agreement are guaranteed by our current and future subsidiaries and include security of first priority interests in our and our subsidiaries’ assets. Initially, we had financial covenants in relation to the CIBC Loan where unrestricted cash is at all times greater than EBITDA for the most recent six-month period, reported on a monthly basis and that revenue for any fiscal quarter must be 15% greater than revenue for the same fiscal quarter in the prior fiscal year, reported on a quarterly basis.

On March 3, 2025, we entered into an amended and restated credit agreement with CIBC (the “CIBC Credit Agreement”), which amended the terms of the CIBC Loan and the existing long-term debt provided under the Original CIBC Credit Agreement was repaid with proceeds from a new revolving line of credit provided by CIBC to us. The line of credit bears interest at the Wall Street Journal Prime Rate subject to a floor of 6.25%. The CIBC Credit Agreement contains certain financial covenants, and the obligations thereunder are secured by, inter alia, a general security agreement over our assets and the assets of our subsidiaries. The revolving line of credit matures on March 3, 2027, and provides an option to us to increase the amount of the revolving commitment by $5,000 within 18 months from March 3, 2025, subject to achieving a minimum trailing 12-month revenue exceeding $15,000. The exercise of the option would result in the size of the revolving commitment increasing from $10,000 to a maximum of $15,000. Additionally, the CIBC Credit Agreement provides that we may request a one-time increase in the principal amount of the revolving line of credit up to a maximum amount of $10,000, which is subject to the approval of CIBC in its sole discretion.

Cash Flows

The following table summarizes our cash flows for each of the periods presented (in thousands):

​

​ | ​ | ​ | ​ | ​
​ | ​ | Six months ended June 30,
​ | ​ | 2025 | ​ | 2024
​ |  | $ |  | $
Cash provided by (used in) operating activities | ​ | (22,027) | ​ | (10,748)
Cash provided by (used in) financing activities |  | (290) |  | 19,853
Foreign exchange on cash |  | 2,600 |  | (1,239)
Net increase (decrease) in cash |  | (19,717) |  | 7,866

​

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Operating Activities

Net cash used in operating activities for the six months ended June 30, 2025 was $(22,027). The principal use of the operating cash flows during the period related to a net loss of $26,419 and a change in net operating assets and liabilities of $1,616 and in non-cash charges of $2,776. The cash used in operating expenses was primarily due to the increased efforts supporting the commercialization and expansion of our products. This resulted in an increase in headcount, travel, clinical trial costs and marketing fees. Non-cash charges consisted primarily of share-based compensation, amortization and depreciation.

Net cash provided by (used in) operating activities for the six months ended June 30, 2024 was $(10,748). The principal use of the operating cash flows during the period related to a net loss of $13,504 a change in net operating asset and liabilities of $602 and non-cash charges of $2,154. The cash used in operating expenses was primarily due to the increased sales and marketing efforts in the US and overall consulting and legal fees. Non-cash charges consisted primarily of share-based compensation, amortization and depreciation.

Financing Activities

Net cash provided by (used in) financing activities for the six months ended June 30, 2025 was $(290) from the repayments of long-term debt principal.

Net cash provided by (used in) financing activities for the six months ended June 30, 2024 was $19,853 primarily from the proceeds from the issuance of common shares of $21,079 net of issuance costs, which were offset by repayments of long-term debt of $1,227.

Foreign Exchange on Cash

Cash was impacted by the change in the foreign exchange rates for the Company’s foreign currency denominated cash (non-USD). The value of our currencies decreased, resulting in a decrease in our cash holdings.

Funding Requirements

Based on our current operating plans, we expect that our existing cash and sales of our products and services will enable us to fund our operating expenses and capital expenditure requirements for at least the next 12 months from the date of the issuance of these unaudited consolidated financial statements. During that time, we expect that our expenses will increase, primarily due to the continued commercialization of TULSA-PRO and Sonalleve.

We manage liquidity risk by monitoring actual and projected cash flows. A cash flow forecast is performed regularly to ensure that we have sufficient cash to meet our operational needs while maintaining sufficient liquidity. Our cash requirements depend on numerous factors, including market acceptance of our products, the resources devoted to developing and supporting the products and other factors. We expect to continue to devote substantial resources to expand procedure adoption and acceptance of our products.

We may require additional capital to fund R&D activities and any significant expansion of operations. Potential sources of capital could include equity and/or debt financings, development agreements or marketing agreements, the collection of revenue resulting from future commercialization activities and/or new strategic partnership agreements to fund some or all costs of development. There can be no assurance that we will be able to obtain the capital sufficient to meet any or all of our needs. The availability of equity or debt financing will be affected by, among other things, the results of R&D and Sales expansion, our ability to obtain regulatory approvals, the market acceptance of our products, the state of the capital markets generally, strategic alliance agreements and other relevant commercial considerations. In addition, if we raise additional funds by issuing equity securities, existing security holders will likely experience dilution, and any incurring of indebtedness would result in increased debt service obligations and could require us to agree to operating and financial covenants that would restrict operations. Any failure on our part to raise additional funds on terms favorable to us or at all may require us to significantly change or curtail current or planned operations in order to conserve cash until such time, if ever, that sufficient proceeds from operations are generated, and could result in us not being in a position to take advantage of business opportunities, in the termination or delay of clinical trials for our products, in curtailment of product development programs designed to identify new products, in the sale or assignment of rights to technologies, product and/or an inability to file market approval applications at all or in time to competitively market products.

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Critical Accounting Policies and Estimates

There have been no significant changes to our critical accounting policies since December 31, 2024. For a description of critical accounting policies that affect our significant judgments and estimates used in the preparation of our unaudited condensed consolidated financial statements, refer to Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” contained in our Annual Report on Form 10-K dated March 7, 2025.

Recent Accounting Pronouncements

See Note 2 to our Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q is incorporated herein by reference.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Not applicable.

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Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Our management maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in our periodic and current reports that we file with the SEC is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives, and management necessarily applies its judgment in evaluating the cost benefit relationship of possible controls and procedures.

Our principal executive officer and principal financial officer, after evaluating the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of June 30, 2025, have concluded that, based on such evaluation, our disclosure controls and procedures were effective to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. You should read this description of our controls and procedures together with “Item 9A. Controls and Procedures” included in our 2024 Annual Report.

Changes in Internal Control Over Financial Reporting

Other than the material weakness remediation activities described below, there were no changes in our internal control over financial reporting, as identified in connection with evaluation required by Rules 13a-15(e) and 15d-15(e) under the Exchange Act, that occurred during the three months ended June 30, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Based on our assessment, management believes that, as of December 31, 2024, the Company’s internal control over financial reporting was not effective based on those criteria as a result of a material weakness in internal control over financial reporting discussed in the paragraphs below.

A material weakness is a deficiency, or a combination of deficiencies, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis.

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In conjunction with the preparation of the Company’s financial statements for the year ended December 31, 2024, and specifically in connection with the recognition of revenue under ASC 606, Revenue from contracts with customers, management determined that the controls over the review of contract terms and arrangements with customers did not operate effectively during 2024. This material weakness resulted in audit adjustments to revenue, trade and other receivables and prepaid expenses, deposits and other assets, which were recorded prior to the issuance of the consolidated financial statements as of and for the year ended December 31, 2024. Management considered these adjustments to constitute a material weakness that required remediation.

During the three months ended June 30, 2025, we have taken steps of implementing our remediation plans with respect to the material weakness identified in our internal control over financial reporting. Specifically, in an effort to address the identified material weakness and enhance our internal controls related to revenue recognition, management has commenced efforts to expand the finance team to include more Chartered Professional Accountants (CPAs) with technical expertise and experience in evaluating more complex areas of US GAAP, specifically contract terms and arrangements with customers, and engaged third-party consultants to assist with assessing the accounting for more complex revenue contracts, as necessary. Management’s efforts are ongoing and its remediation plan is expected to be completed during 2025.

While we believe that these efforts will improve our internal control over financial reporting in accordance with U.S. GAAP and SEC reporting requirements, the implementation of these measures is ongoing and will require validation and testing of the design and operating effectiveness of internal controls over a sustained period of financial reporting cycles. This material weakness could result in misstatements of the company’s financial statement accounts and disclosures that could result in a material misstatement to the annual or interim consolidated financial statements that would not be prevented or detected. The material weaknesses will not be considered remediated until our management designs and implements effective controls that operate for a sufficient period of time and our management has concluded through testing that these controls are effective. We cannot assure you that the measures we have taken to date, and are continuing to implement, will be sufficient to establish and maintain effective internal control over financial reporting.

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PART II—OTHER INFORMATION

Item 1. Legal Proceedings.

From time to time, we may be subject to legal proceedings. We are not currently a party to or aware of any proceedings that we believe will have, individually or in the aggregate, a material adverse effect on our business, financial condition or results of operations. Regardless of outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources, and other factors.

Item 1A. Risk Factors.

Our business is subject to a number of risks, including risks that may prevent us from achieving our business objectives or may adversely affect our business, financial condition, results of operations, cash flows, and prospects. These risks are discussed more fully in the section entitled “Risk Factors” in our 2024 Annual Report. There have been no material changes to the risk factors described in the 2024 Annual Report.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None.

Item 3. Defaults Upon Senior Securities.

None.

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Item 4. Mine Safety Disclosures.

None.

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Item 5. Other Information.

Rule 10b5-1 Trading Plans

During the three months ended June 30, 2025, none of our directors or executive officers adopted, modified or terminated any contract, instruction or written plan for the purchase or sale of our securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement” as defined in Item 408(c) of Regulation S-K.

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Item 6. Exhibits.

Exhibit Number |  | Exhibit Description |  | Filed with this Report |  | Incorporated by Reference herein from Form or Schedule |  | Filing Date |  | SEC File/Reg. Number
3.1 | ​ | Articles of Incorporation | ​ | ​ | ​ | Form S-8 (Exhibit 4.1) | ​ | 11/7/2019 | ​ | 333-234574
3.2 | ​ | Articles of Amendment | ​ | ​ | ​ | Form S-8 (Exhibit 4.2) | ​ | 11/7/2019 | ​ | 333-234574
3.3 | ​ | Articles of Amalgamation | ​ | ​ | ​ | Form S-8 (Exhibit 4.3) | ​ | 11/7/2019 | ​ | 333-234574
3.4 | ​ | Bylaws | ​ | ​ | ​ | Form S-8 (Exhibit 4.4) | ​ | 11/7/2019 | ​ | 333-234574
31.1 | ​ | Certification of the Company’s Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | ​ | X | ​ | ​ | ​ | ​ | ​ | ​
31.2 | ​ | Certification of the Company’s Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | ​ | X | ​ | ​ | ​ | ​ | ​ | ​
32† | ​ | Certification of the Company’s Principal Executive Officer and Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | ​ | X | ​ | ​ | ​ | ​ | ​ | ​
101.INC | ​ | Inline XBRL Instance Document | ​ | X | ​ | ​ | ​ | ​ | ​ | ​
101.SCH | ​ | Inline XBRL Taxonomy Extension Schema Document | ​ | X | ​ | ​ | ​ | ​ | ​ | ​
101.CAL | ​ | Inline XBRL Taxonomy Extension Calculation Linkbase Document | ​ | X | ​ | ​ | ​ | ​ | ​ | ​
101.DEF | ​ | Inline XBRL Taxonomy Extension Definition Linkbase Document | ​ | X | ​ | ​ | ​ | ​ | ​ | ​
101.LAB | ​ | Inline XBRL Taxonomy Extension Label Linkbase Document | ​ | X | ​ | ​ | ​ | ​ | ​ | ​
101.PRE | ​ | Inline XBRL Taxonomy Extension Presentation Linkbase Document | ​ | X | ​ | ​ | ​ | ​ | ​ | ​
104 | ​ | Cover Page Interactive Data File (formatted as iXBRL and contained in Exhibit 101). ​ | ​ | X | ​ | ​ | ​ | ​ | ​ | ​

* Filed herewith.

† The certifications attached as Exhibit 32 that accompany this Quarterly Report on Form 10-Q are not deemed filed with the Securities and Exchange Commission and are not to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended (whether made before or after the date of such Form 10-Q), irrespective of any general incorporation language contained in such filing.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

​ | ​ | PROFOUND MEDICAL CORP.
​ | ​ | ​ | ​
Date:August 14, 2025 |  | By: | /s/ Arun Menawat
​ | ​ | ​ | Name: Arun Menawat
​ | ​ | ​ | Title: Chief Executive Officer
​ | ​ | ​ | (Principal Executive Officer)
​ | ​ | ​ | ​
Date:August 14, 2025 | ​ | By: | /s/ Rashed Dewan
​ | ​ | ​ | Name: Rashed Dewan
​ | ​ | ​ | Title: Chief Financial Officer
​ | ​ | ​ | (Principal Financial and Accounting Officer)

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