Despite a more uncertain and cautious market climate with strained budgets at hospitals and simulator centers, especially in the USA (which was also mentioned in the interim report for the first quarter), commercial activity was high during the quarter and Surgical Science sees a continued strong pipeline for the coming quarters.

One consequence of the more uncertain market situation is that the time it takes for quotes to become orders increases. During the second quarter, this resulted in many orders for simulator revenue coming towards the end of the quarter. These orders then did not have time to be produced and distributed, which means that the order book at the end of the quarter was approximately SEK 30 million higher than at the beginning of the quarter. These orders will be shipped during the third quarter.

License revenues vary between quarters, partly because customers who have just started selling the products that Surgical Science has license revenues from purchase the licenses in packages. There is also an impact on revenues from Intuitive for the quarter, due to the transition between different generations of surgical systems where the older generation, where simulation is an option, has seen a decline in renewals of simulation subscriptions.

Development revenues, which later generate simulator and license revenues, were very strong during the quarter, partly due to revenues attributable to the order to deliver products to the Ministry of Defense in a Southeast Asian country, which was signed at the beginning of the year.

Due to the mix of revenues, the gross margin was lower than in the comparison period, provisionally just over 65% (68).

Large currency effects negatively affected the result by approximately SEK 25 million. A major factor was the weakening of the USD against the ILS. The largest part is due to revaluation of intercompany items. Costs were in line with expectations.

The preliminary operating result for the quarter (including the above-mentioned currency effects) shows a loss of approximately SEK 22 million. For the first half of the year, the preliminary operating profit amounts to approximately SEK 2 million (59), or SEK 28 million excluding acquisition and restructuring costs for Intelligent Ultrasound.

"We are acting quickly and decisively in this more uncertain market climate. Measures have already been taken and are ongoing to ensure that we can return to sales growth and convert the order book into revenue faster, to achieve our financial goals. Our focus is also on executing a number of profitability and efficiency improving measures that we assess will have an effect during the second half of this year. The integration of Intelligent Ultrasound is going according to plan and we are continuously realizing greater synergies. We feel confident in the long-term market potential for medical simulation and with our strategy and investments. We are equipped for continued growth in 2025/2026 and to achieve our goals for 2026." says Tom Englund, CEO of Surgical Science.

Surgical Science's interim report for the second quarter will be published on August 21 at 7:30 a.m.

Gothenburg, Sweden, August 7, 2025
Surgical Science Sweden AB (publ)

This press release, in its entirety, is available through the attachment or via:
https://surgicalscience.com/investor-relations/#press-releases

This is a translation of the Swedish version of the press release. When in doubt, the Swedish wording prevails.