Spectral AI, Inc. announced its financial results for the third quarter ended September 30, 2024, on November 6, 2024, reporting a 138% increase in research and development revenue to $8.2 million, up from $3.4 million in Q3 2023. This growth was primarily driven by increased activity on the Project BioShield (PBS) contract with BARDA and other U.S. Government contracts.
The company's gross margin improved to 44.9% from 42.8% in the prior year period, reflecting higher development activity and revenue. Operating loss narrowed significantly to $(0.9) million from $(4.2) million in Q3 2023, attributed to higher revenue, improved gross margin, and a $1.0 million reduction in non-revenue-generating R&D activities.
Spectral AI also announced its intent to spin off its Spectral IP, Inc. subsidiary, aiming to maximize shareholder value by allowing Spectral IP to focus on monetizing intellectual property assets outside of medical diagnostics. The company reiterated its revenue guidance of approximately $28.0 million for fiscal year 2024, ending Q3 2024 with $3.7 million in cash.
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