Aiforia Technologies Plc, Company Release, March 7, 2025 at 9.00 a.m. EET

Aiforia Technologies Plc’s Financial Statements Bulletin for January–December 2024 (unaudited): Aiforia’s market position and orderbook strengthened

Aiforia arranges a live webcast on a result publication day at 10.00 a.m. Finnish time. Details of the event and how to participate can be found at the end of this release.

This release is a summary of Aiforia Technologies Plc's Financial Statements Bulletin for January–December 2024. The full report is attached to this release and also available at https://investors.aiforia.com/en/.

The demand for Aiforia’s AI-assisted image analysis solutions grew significantly in 2024, with order book increasing by 118% compared to last year. Aiforia’s stable market position as a well-known supplier was reflected in a shift of new contracts from smaller deals to multi-year partnerships with large hospital districts. This change brought stability and predictability to the company’s business. Strategic partnerships are expected to accelerate growth over the years as collaborations generate revenue. 

Unless otherwise indicated, figures in brackets refer to the corresponding period in 2023.

July–December 2024 

• Group revenue increased by 3% to EUR 1,479 (1,438) thousand.  
• Order book increased by 118% to EUR 5,165 (2,373) thousand. 
• EBITDA was EUR -4,021 (-4,616) thousand.  
• Operating loss (EBIT) was EUR -6,122 (-6,363) thousand.  
• Profit for the review period was EUR -5,980 (-6,393) thousand.  
• The Group’s net debt at the end of the period was EUR -4,935 (-8,126) thousand.  
• Cash and cash equivalents at the end of the period amounted to EUR 11,496 (13,974) thousand.  
• Unadjusted earnings per share (EPS) were EUR -0.22 (-0.25). 
• In the second half of the year, Aiforia signed significant cooperation agreements and made new market openings, e.g. with Finland's largest healthcare laboratory company, Fimlab, with the Castile and León Hospital District in Spain, with one of the world's leading hospitals, Assistance Publique-Hôpitaux de Paris in Paris, France and with the Lombardy healthcare region in Italy.

January–December 2024

• Group revenue increased by 19% to EUR 2,852 (2,398) thousand.  
• Order book increased by 118% to EUR 5,165 (2,373) thousand. 
• EBITDA was EUR -8,220 (-9,699) thousand.  
• Operating loss (EBIT) was EUR -12,195 (-12,879) thousand.  
• Profit for the review period was EUR -11,947 (-12,925) thousand.  
• Unadjusted earnings per share (EPS) were EUR -0.43 (-0.50).  
• The parent company's loss for the financial year is EUR -10,423 thousand, and the distributable free equity is EUR 10,078 thousand. The Board of Directors proposes to the General Meeting that the loss for the financial year be retained in the retained earnings account and that no dividend be paid.

Key figures

*Personnel expenses include capitalization of development expenses.  

**The Company’s potential dilutive instruments consist of stock options. As the Company’s business has been unprofitable, stock options would have an anti-dilutive effect and are therefore not taken into account in calculating the dilutive loss per share. Thus, there is no difference between the undiluted and diluted earnings per share. 

Jukka Tapaninen, CEO: 

The demand for Aiforia’s AI-assisted image analysis solutions strengthened significantly during the year. In the pathology sector, improving the efficiency of the workflow by utilizing AI is a key development target as the population ages and sample volumes increase. Using our AI solutions in diagnostics supports the efficiency and quality of our customers’ operations. This was reflected in our order book, which we consider to be the most important key performance indicator, which grew by 118 percent during the year. A strengthened order book will be reflected in the development of our revenue as the systems are installed and integrated into our customers’ workflows.  

We have invested in product development, which has led to good commercialization of our products and strengthened our market position. At the same time, we have honed our organization and strengthened sales and R&D. Our stable market position as a well-known supplier is also reflected in the shift in the focus of new contracts from smaller deals to multi-year partnerships with large hospital districts. This change has brought stability and predictability to our business, which is positively reflected in our order book.  

During the year, we received important references from Europe, both in large public tenders and from the private healthcare sector. Examples of these include one of the world’s leading hospitals located in Paris, Assistance Publique-Hôpitaux de Paris, choosing Aiforia’s AI solutions. In Spain, the regional health management of Castile and León selected us as a solution provider for AI-assisted diagnostics. In Italy, after our first successful digital pathology project, Aiforia was also selected as a partner to digitize the anatomical pathology laboratories of 31 health authorities in the Lombardy region in the Veneto area. These partnerships significantly strengthen our position in the European market and demonstrate that our innovative AI solutions deliver value to our customers. In a new market opening, Memorial Hospitals Group in Turkey has selected Aiforia as its partner for AI-assisted clinical diagnostics in pathology.  

A significant opening in the domestic market was our multi-year partnership with Finland's largest healthcare laboratory company, Fimlab.  

To accelerate our growth strategy, we signed several partnerships related to resale and product collaboration, e.g., in the United States, South Korea and Saudi Arabia. The market for digital pathology is growing rapidly in South Korea, and hospitals are increasingly interested in introducing AI solutions to improve pathologists’ workflow. These partnerships that support the resale of our products are significant steps in bringing our AI to new markets and meet the growing needs of pathologists and medical professionals in these target countries. 

We invested in the development of new AI models and user interfaces for both clinical diagnostics and research use. With this development, our product range will expand during 2025. We launched a completely new AI model developed in collaboration with the Mayo Clinic to predict the risk of colorectal cancer recurrence. We also strengthened our product range by introducing the Aiforia® Studies software module to the market, designed to support AI-assisted image analytics in preclinical studies. 

During the review period, we further developed the Aiforia® Create product, designed for training AI models, by adding new functionalities and enabling the use of neural networks developed by third parties, such as large Foundation Models. We also further improved the integration possibilities of Aiforia’s platform with the systems used by customer laboratories. 

The achievements of the past year bring us closer to Aiforia’s mission to transform pathology image analysis with AI, enabling better care for each patient. At the beginning of the year, we published short-term business targets for 2024–2025. This year, we will continue to work determinedly towards achieving these goals.  

The digital transformation of pathology is accelerating, and the demand for AI-assisted image analysis solutions is growing rapidly. Aiforia is at the forefront of this exciting development, and our skilled team and cutting-edge offering position us for continued success in these dynamic markets. We rely on our ability to navigate a changing competitive environment and deliver exceptional value to our customers. I am incredibly proud of what we have achieved together and look forward to continuing this journey in 2025.

Business targets

Aiforia does not publish short-term outlooks or financial targets. However, the company has set short- and medium-term business targets:   

Aiforia’s short-term business targets for 2024–2025 are:   

• Expand pre-clinical offering with new AI models and study-centric GLP (Good Laboratory Practice) workflow  
• Expand clinical offering with 10 new regulatory-approved AI models  
• Form at least three new strategic partnerships 
• Achieve 15 key accounts (potential for over EUR 500 thousand in annual recurring revenue)  
• Achieve a positive cash flow from operating activities.  

Aiforia’s updated mid-term business targets by the end of 2030 are:  

• Create a product offering that covers 80 percent of the pathologist’s diagnostic workflow  
• Achieve profitable business by the end of 2027  
• Achieve revenue of over EUR 100 million  
• Leverage technology beyond diagnostic support for pathologists  
• Achieve 50 key accounts (potential for over EUR 500 thousand in annual recurring revenue). 

Operating environment 

An aging population and an increase in serious diseases, such as cancer, strain healthcare systems worldwide (WHO Report on Cancer, 2020). Laboratories and hospitals are reforming diagnostic workflows to improve efficiency and support pathologists’ work. Accurate diagnoses enable personalized patient care and improve the effectiveness of treatments.  

Pathologists examine and diagnose patient specimens, thereby guiding medical treatment. With the digitalization of pathology, samples traditionally examined under the microscope are increasingly being analyzed by computers. With the advent of digital pathology, laboratories and hospitals can take advantage of increasingly sophisticated technologies such as AI.   

During the review period, significant public sector investment decisions and competitive tendering in utilizing AI in healthcare were made especially in Europe. Aiforia estimates that this reflects the fact that the digitalization rate of pathology has increased, and AI-based image analysis solutions are becoming more common as a result.  

Revenue and profitability 

July‒December (H2) 2024

Revenue 

In July–December, the Group’s revenue increased by 3 percent to EUR 1,479 (1,438) thousand. Revenue consisted of sales of Aiforia’s software solutions and services to both clinical sector and preclinical research customers. Of the revenue, 40 percent (7%) came from Finland, 45 percent (53%) from North America, and the remaining 15 percent (40%) from Europe and other regions across the globe.  

The other operating income amounted to EUR 226 (39) thousand. Of this, the company recognized EUR 224 (37) thousand as product development and other grants. The grants were related to the EU-funded Decider project, coordinated by the University of Helsinki, and the recognition of the grant portion of the loan drawn from Business Finland. Foreign exchange rate gains from sales are EUR 1 (1) thousand and other income amounted to EUR 1 (1) thousand. 

Profitability 

The cost of materials and services directly related to revenue amounted to EUR 337 (217) thousand, mainly consisting of purchased cloud services associated with Aiforia's services and products.  

The Group's EBITDA for the July–December period was EUR -4,021 (-4,616) thousand, while the operating loss (EBIT) was EUR -6,122 (-6,363) thousand. The result for July–December was EUR -5,980 (-6,393) thousand. The Group's result aligns with the company's strategy and reflects the stage in Aiforia's development where the company invests heavily in product development to enable future growth.  

Depreciation of tangible and intangible assets amounted to EUR 2,101 (1,747) thousand.  

Aiforia's personnel expenses before capitalization for July–December amounted to EUR 4,916 (4,848) thousand and other operating expenses to EUR 3,384 (4,030) thousand. The company capitalized EUR 1,206 (958) thousand in personnel expenses and EUR 1,744 (1,932) thousand in other operating expenses in July–December. Personnel costs include EUR 843 (708) thousand in non-monetary costs arising from share-based incentive schemes.  

Financial income and expenses amounted to EUR 142 (-50). The breakdown of items has been changed; the subsidiary's foreign exchange gains and losses, which were netted in the 2023 comparison period, have been adjusted to their own lines.

January‒December 2024

Revenue 

In January–December, the Group’s revenue was EUR 2,852 (2,398) thousand. Revenue consisted of sales of Aiforia's software solutions and services to both clinical sector and preclinical research customers. Of the revenue, 25 percent (9%) came from Finland, 40 percent (60%) from North America, and the remaining 35 percent (31%) from Europe and other regions across the globe. 

The other operating income amounted to EUR 368 (93) thousand. The company recognized EUR 365 (78) thousand as product development and other grants in January–December. All grants were related to the EU-funded Decider project, coordinated by the University of Helsinki, as well as the funding grant from Business Finland. The share of exchange rate gains from sales was EUR 2 (13) thousand and the other income amounted to EUR 1 (1) thousand. 

Profitability 

The cost of materials and services directly related to revenue amounted to EUR 602 (466) thousand, mainly consisting of purchased cloud services associated with Aiforia's services and products.  

The Group's EBITDA for January–December 2024 was EUR -8,220 (- 9,699) thousand, while the operating loss (EBIT) was EUR -12,195 (-12,879) thousand. The result for the year 2024 was EUR 11,947 (-12,925) thousand. The Group's result aligns with the company's strategy and reflects the stage in Aiforia's development where the company invests heavily in product development to enable future growth.  

Depreciation of tangible and intangible assets amounted to EUR 3,975 (3,180) thousand. 

Personnel expenses before capitalization for January–December 2024 amounted to EUR 9,303 (9,154) thousand and other operating expenses before capitalization to EUR 7,115 (8,496) thousand. The company capitalized EUR 2,369 (1,360) thousand in personnel expenses and EUR 3,212 (4,567) thousand in other operating expenses in January–December 2024. Personnel expenses include EUR 1,190 (1,181) thousand non-monetary expenses arising from share-based incentive schemes.  

Financial income and expenses amounted to EUR 248 (-46) thousand.

Balance sheet, cash flow, and financing 

The Group's balance sheet total at the end of the financial year 2024 was EUR 28,376 (28,191) thousand. The equity ratio was 61% (66%).   

At the end of the financial year the Group's net debt was EUR -4,935 (-8,126) thousand. Non-current liabilities amounted to EUR 7,078 (6,169) thousand.   

Net cash flow from operating activities in the financial year 2024 totaled EUR -7,803 (-8,160) thousand. The company continued to invest heavily in product development, as planned.  

Cash flow from investing activities totaled EUR –5,593 (-5,986) thousand, consisting of investments in intangible and tangible assets.  

Cash flow from financing activities in the financial year 2024 amounted to EUR 10,883 (3,486) thousand. Cash and cash equivalents at the end of the year 2024 amounted to EUR 11,496 (13,974) thousand. The company's financial and cash position is stable, however, to ensure sufficient balance sheet position to finance growth long into the future the company is, in the next twelve months, also exploring different options to strengthen its capital structure, including equity and debt instruments, as well as subsidies and grants. 

In May 2024, Aiforia carried out a directed share issue of 2,843,851 new shares, raising EUR 9.95 million. The net proceeds from the placing are intended to be used to support Aiforia’s growth strategy by enhancing its product development function and accelerating the regulatory approval process in the United States for its AI-assisted software solutions. In addition, the net proceeds of the placing aim to strengthen the company’s sales and marketing activities, as well as serve other operational purposes.  

In March 2024, a total of 50,000 Aiforia shares were subscribed for through employee stock options. The company received EUR 68.6 thousand from the share subscriptions recorded in the unrestricted equity reserve.  

In October 2024, a total of 70,000 Aiforia shares were subscribed for through employee stock options. The company received EUR 82.5 thousand from the share subscriptions recorded in the unrestricted equity reserve. 

During 2024, EUR 505 (505) thousand in long-term interest-bearing debt was repaid, and EUR 1,800 (4,040) thousand new debt was drawn. 

Investments, research and development 

Gross investments in the financial year 2024 amounted to EUR 5,652 (6,071) thousand. The most significant part of Aiforia's investments comprises investments in product development and the commercialization of new software solutions.  

The company's investments in product development are essential for implementing its strategy without compromise. Product development investments are expected to deliver commercial benefits over the next few years. The amortization period for product development investments is five years from the date of capitalization. 

Personnel 

The average number of Aiforia's employees in the financial year 2024 was 75 (73) full-time equivalents. At the end of the financial year, Aiforia employed 77 (79) people. Of them, 60 (56) worked in Finland, 9 (10) in the rest of Europe, and 8 (13) in the United States. The Group has offices in Helsinki, Cambridge, MA and Rochester MN, USA, where the wholly owned subsidiary Aiforia Inc. is located.  

Proposal by the Board of Directors on the treatment of the result for the financial year 

The parent company's loss for the financial year 2024 is EUR -10,423 thousand and the distributable free equity is EUR 10,078 thousand. The Board of Directors proposes to the General Meeting that the loss for the financial year be retained in the retained earnings account and that no dividend be paid. 

Significant events after the reporting period 

Aiforia announced on February 18, 2025, the share subscriptions based on stock options. A total of 20,000 Aiforia Technologies Plc’s new shares were subscribed for with the Stock Options 2016A by January 13, 2025. For subscriptions made with the stock options 2016A the entire subscription price of EUR 400.00 will be entered in the reserve for invested unrestricted equity. New shares were registered in the Trade Register on February 18, 2025, and will be traded on the Nasdaq Helsinki Plc’s First North Growth Market Finland -marketplace as of February 19, 2025. After the trade registration the total amount of shares is 28,934,467. 

The terms and conditions of stock options are available on the company's website at https://investors.aiforia.com/en/. 

On February 20, 2025, Aiforia announced that it had successfully obtained the In Vitro Diagnostic Regulation (IVDR) certification. At the same time, the company launched three new CE IVD -marked AI models for breast and prostate cancer diagnostics. The certification was granted by a notified body, BSI Group. The certificate confirms that Aiforia complies with the requirements of the IVD Regulation 2017/746 and enables Aiforia to bring an expanded portfolio of AI models to the European market.

On March 5, 2025 Aiforia and Orion, a Finnish pharmaceutical company, announced the extension of their collaboration to include the use of Aiforia's software solution for preclinical study evaluations. This collaboration involves implementing the Aiforia^®Studies module within Orion's preclinical histology processes, as well as joint development to further automate and improve the study evaluation workflow of preclinical pathologists.

On March 6, 2025, Aiforia announced that it had closed a deal with a regional health authority of Sardinia in Italy for AI-assisted diagnostics. This two-year collaboration contract with seven hospitals in the region involves utilizing Aiforia's clinical AI solutions to analyze biopsies from breast and prostate cancer patients. The provider in the deal is a GPI S.p.A. lead consortium, and Aiforia is one of their subcontractors. 

Financial reporting and the Annual General Meeting in 2025

The calendar for Aiforia Technologies Plc’s financial reporting concerning the financial year 2025 is as follows:  

• March 14, 2025: The Financial Statements and the Board of Directors’ Report for financial year 2025 
• August 28, 2025: Half-Year Financial Report for January 1 to June 30, 2025 

Aiforia Technologies’s Annual General Meeting is planned to be held on April 4, 2025.  

Financial reports are available after publication on Aiforia's website at https://investors.aiforia.com/en/. 

Webcast 

Aiforia arranges a live webcast for investors, analysts, and media on March 7, 2025, at 10.00 a.m. Finnish time. The event will be held in English. The financial results will be presented by Jukka Tapaninen, CEO and Veli-Matti Parkkonen, CFO.  

The webcast can be followed at https://aiforia.videosync.fi/q4-2024. 

A recording of the event and the presentation materials will be available at https://investors.aiforia.com/ later in the day.

Further inquiries

Veli-Matti Parkkonen, CFO, Aiforia Technologies Plc
tel. +358 405 009 878
https://investors.aiforia.com/

Certified Adviser 
UB Corporate Finance Ltd
ubcf@unitedbankers.fi

About Aiforia

Aiforia is a trusted provider of deep learning artificial intelligence (AI) solutions for pathology. Aiforia delivers software solutions that elevate diagnostic capabilities in image analysis, enabling remarkable medical discoveries now and in the future. With thousands of AI models already developed on the Aiforia platform for research use and several diagnostic solutions deployed, Aiforia is already significantly impacting pathology and healthcare.

Founded in 2013, Aiforia is a publicly traded company operating internationally with thousands of platform users across the globe. The company is headquartered in Helsinki, Finland, with offices in Cambridge, Massachusetts, and Rochester, Minnesota, and local representatives across Europe and North America. The diverse team at Aiforia includes experienced pathologists, medical scientists, AI and software developers, and a dedicated commercial team. Together, they are working to transform pathology with AI, enabling better care for each patient.

Find out more at www.aiforia.com