Form 10-Q - Quarterly report [Sections 13 or 15(d)]

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 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 March 31, 2024

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT OF 1934

For the transition period from ___________to_________

Commission File Number: 001-39949

_________________

Hyperfine, Inc.

(Exact name of registrant as specified in its charter)

_________________


Delaware		98-1569027
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)
351 New Whitfield Street Guilford, Connecticut		06437
(Address of principal executive offices)		(Zip Code)

(866) 796-6767

(Registrant’s telephone number, including area code)

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


Title of Each Class	Trading Symbol(s)	Name of each exchange on which registered
Class A common stock, $0.0001 Par Value Per Share	HYPR	The Nasdaq Stock Market LLC

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 ☐

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 ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a 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.


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. ☐

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

As of May 1, 2024, the registrant had 56,952,666 shares of Class A common stock outstanding and 15,055,288 shares of Class B common stock outstanding.

TABLE OF CONTENTS


		Page
	Cautionary Statement Regarding Forward-Looking Statements	3
PART I	FINANCIAL INFORMATION	5
Item 1.	Financial Statements	5
	Condensed Consolidated Balance Sheets (unaudited)	5
	Condensed Consolidated Statements of Operations and Comprehensive Loss (unaudited)	6
	Condensed Consolidated Statements of Changes in Stockholders’ Equity (unaudited)	7
	Condensed Consolidated Statements of Cash Flows (unaudited)	8
	Notes to Condensed Consolidated Financial Statements (unaudited)	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	28
Item 4.	Controls and Procedures	28
PART II	OTHER INFORMATION	29
Item 1.	Legal Proceedings	29
Item 1A.	Risk Factors	29
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	29
Item 3.	Defaults Upon Senior Securities	29
Item 4.	Mine Safety Disclosures	29
Item 5.	Other Information	29
Item 6.	Exhibits	30
	Signatures	31

All brand names or trademarks appearing in this report are the property of their respective holders. Use or display by us of other parties’ trademarks, trade dress, or products in this report is not intended to, and does not, imply a relationship with, or endorsements or sponsorship of, us by the trademark or trade dress owners. Unless the context requires otherwise, references in this report to the “Company,” “we,” “us,” and “our” refer to Hyperfine, Inc. and its wholly-owned subsidiaries, including Hyperfine Operations, Inc., or Legacy Hyperfine, and Liminal Sciences, Inc., or Liminal, as the case may be.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that relate to future events or our future financial performance regarding, among other things, the plans, strategies and prospects, both business and financial, of the Company. These statements are based on the beliefs and assumptions of our management team. Although we believe that our plans, intentions and expectations reflected in or suggested by these forward-looking statements are reasonable, we cannot assure you that we will achieve or realize these plans, intentions or expectations. Forward-looking statements are inherently subject to risks, uncertainties and assumptions. Generally, statements that are not historical facts, including statements concerning possible or assumed future actions, business strategies, events or results of operations, are forward-looking statements. These statements may be preceded by, followed by or include the words “believes,” “estimates,” “expects,” “projects,” “forecasts,” “may,” “will,” “should,” “seeks,” “plans,” “scheduled,” “anticipates” or “intends” or similar expressions. Forward-looking statements contained in this Quarterly Report on Form 10-Q include, but are not limited to, statements about:

•

the success, cost and timing of our product development activities;

•

the commercialization and adoption of our existing products and the success of our future product offerings;

•

the potential attributes and benefits of our products and services;

•

our ability to obtain and maintain regulatory approval for our products, and any related restrictions and limitations of any approved product;

•

our ability to identify, in-license or acquire additional technology;

•

our ability to maintain our existing licensing, manufacturing and supply agreements;

•

our ability to compete with other companies currently marketing or engaged in the development of magnetic resonance imaging technologies, many of which have greater financial and marketing resources than us;

•

the size and growth potential of the markets for our products and services, and the ability of our products and services to serve those markets, either alone or in partnership with others;

•

the pricing of our products and services and reimbursement for medical procedures conducted using our products and services;

•

changes in applicable laws or regulations;

•

our estimates regarding expenses, revenue, capital requirements and needs for additional financing;

•

our ability to raise financing in the future;

•

our financial performance;

•

our success in retaining or recruiting, or necessary changes in, our officers, key employees or directors;

•

intense competition and competitive pressures from other companies in the industry in which we operate;

•

market conditions and global and economic factors, such as inflation or the conflicts in Ukraine and the Middle East;

•

our intellectual property rights; and

•

the effect of legal, tax and regulatory changes.

These and other risks and uncertainties are described in greater detail under the caption “Risk Factors” in Item 1A of Part I of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, in Item 1A of Part II of this Quarterly Report on Form 10-Q, and in other filings that we make with the Securities and Exchange Commission

(the “SEC”). The risks described under the heading “Risk Factors” are not exhaustive. New risk factors emerge from time to time, and it is not possible to predict all such risk factors, nor can we assess the impact of all such risk factors on our business or the extent to which any factor or combination of factors may cause actual results to differ materially from those contained in any forward-looking statements. Forward-looking statements are not guarantees of performance. You should not put undue reliance on these statements, which speak only as of the date hereof. All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by the foregoing cautionary statements. We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements

HYPERFINE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(in thousands, except share and per share amounts)


	March 31, 2024			December 31, 2023
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	63,204		$	75,183
Restricted cash		—			621
Accounts receivable, less allowance of $248 and $321 as of March 31, 2024 and December 31, 2023, respectively		5,343			3,189
Unbilled receivables		895			942
Inventory		7,298			6,582
Prepaid expenses and other current assets		2,950			2,391
Total current assets		79,690			88,908
Property and equipment, net		3,706			2,999
Other long term assets		2,047			2,292
Total assets	$	85,443		$	94,199
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable	$	2,532		$	1,214
Deferred grant funding		—			621
Deferred revenue		1,527			1,453
Due to related parties		45			61
Accrued expenses and other current liabilities		4,663			5,419
Total current liabilities		8,767			8,768
Long term deferred revenue		1,021			968
Other noncurrent liabilities		17			64
Total liabilities		9,805			9,800
COMMITMENTS AND CONTINGENCIES (NOTE 13)
STOCKHOLDERS' EQUITY
Class A Common stock, $.0001 par value; 600,000,000 shares authorized; 56,952,666 and 56,840,949 shares issued and outstanding at March 31, 2024 and December 31, 2023, respectively		5			5
Class B Common stock, $.0001 par value; 27,000,000 shares authorized; 15,055,288 shares issued and outstanding at March 31, 2024 and December 31, 2023, respectively		2			2
Additional paid-in capital		339,201			338,114
Accumulated deficit		(263,570	)		(253,722	)
Total stockholders' equity		75,638			84,399
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	85,443		$	94,199

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

HYPERFINE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Unaudited)

(in thousands, except share and per share amounts)


	Three Months Ended March 31,
	2024			2023
Sales
Device	$	2,704		$	2,132
Service		591			503
Total sales		3,295			2,635
Cost of sales
Device		1,499			1,071
Service		442			409
Total cost of sales		1,941			1,480
Gross margin		1,354			1,155
Operating Expenses:
Research and development		5,570			5,461
General and administrative		4,430			6,182
Sales and marketing		2,004			2,547
Total operating expenses		12,004			14,190
Loss from operations		(10,650	)		(13,035	)
Interest income		796			869
Other income, net		6			6
Loss before provision for income taxes		(9,848	)		(12,160	)
Provision for income taxes		—			—
Net loss and comprehensive loss	$	(9,848	)	$	(12,160	)
Net loss per common share attributable to common stockholders, basic and diluted	$	(0.14	)	$	(0.17	)
Weighted-average shares used to compute net loss per share attributable to common stockholders, basic and diluted		71,934,045			70,864,226

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

HYPERFINE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (Unaudited)

(in thousands, except share amounts)


	Class A Common Stock				Class B Common Stock				Additional		Accumulated			Total Stockholders'
	Shares		Amount		Shares		Amount		Paid-in Capital		Deficit			Equity
Balance, December 31, 2023		56,840,989	$	5		15,055,288	$	2	$	338,114	$	(253,722	)	$	84,399
Net loss		—		—		—		—		—		(9,848	)		(9,848	)
Issuance of restricted stock		41,007		—		—		—		—		—			—
Exercise of stock options		70,670		—		—		—		55		—			55
Stock-based compensation expense		—		—		—		—		1,032		—			1,032
Balance, March 31, 2024		56,952,666		5		15,055,288		2		339,201		(263,570	)		75,638


	Class A Common Stock				Class B Common Stock				Additional		Accumulated			Total Stockholders'
	Shares		Amount		Shares		Amount		Paid-in Capital		Deficit			Equity
Balance, December 31, 2022		55,622,488	$	5		15,055,288	$	2	$	333,199	$	(209,484	)	$	123,722
Net loss		—		—		—		—		—		(12,160	)		(12,160	)
Issuance of restricted stock		324,296		—		—		—		—		—			—
Exercise of stock options		54,211		—		—		—		49		—			49
Stock-based compensation expense		—		—		—		—		1,126		—			1,126
Balance, March 31, 2023		56,000,995		5		15,055,288		2		334,374		(221,644	)		112,737

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

HYPERFINE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(in thousands)


	Three Months Ended March 31,
	2024			2023
Cash flows from operating activities:
Net loss	$	(9,848	)	$	(12,160	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		263			254
Stock-based compensation expense		1,032			1,126
Payments received on net investment in lease		34			2
Changes in assets and liabilities:
Accounts receivable, net		(2,154	)		(915	)
Unbilled receivables		47			(259	)
Inventory		(833	)		(1,122	)
Prepaid expenses and other current assets		(1,252	)		272
Due from related parties		—			48
Prepaid inventory		693			281
Other long term assets		200			(18	)
Accounts payable		1,208			954
Deferred grant funding		(621	)		(58	)
Deferred revenue		127			(125	)
Due to related parties		(16	)		64
Accrued expenses and other current liabilities		(1,392	)		(1,835	)
Operating lease liabilities, net		2			—
Net cash used in operating activities		(12,510	)		(13,491	)
Cash flows from investing activities:
Purchases of property and equipment		(145	)		(61	)
Net cash used in investing activities		(145	)		(61	)
Cash flows from financing activities:
Proceeds from exercise of stock options		55			49
Net cash provided by financing activities		55			49
Net decrease in cash and cash equivalents and restricted cash		(12,600	)		(13,503	)
Cash, cash equivalents and restricted cash, beginning of period		75,804			118,243
Cash, cash equivalents and restricted cash, end of period		63,204			104,740
Reconciliation of cash, cash equivalents, and restricted cash reported in the balance sheets
Cash and cash equivalents		63,204			104,027
Restricted cash		—			713
Total cash, cash equivalents and restricted cash	$	63,204		$	104,740
Supplemental disclosure of noncash information:
Unpaid purchase of property and equipment	$	742		$	36

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

HYPERFINE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(all amounts are in thousands, except share and per share amounts)

1. ORGANIZATION AND DESCRIPTION OF BUSINESS

Hyperfine, Inc. (together with its subsidiaries, as applicable, “Hyperfine” or the “Company”), formerly known as HealthCor Catalio Acquisition Corp. (“HealthCor”), was incorporated as a Cayman Islands exempted company on November 18, 2020. The Company’s legal name became Hyperfine, Inc. in connection with the closing (the “Closing”) of the business combination with HealthCor (the “Business Combination”) on December 22, 2021 (the “Closing Date”). In connection with the Closing, Hyperfine, Inc., a Delaware corporation (“Legacy Hyperfine”), and Liminal Sciences, Inc., a Delaware corporation (“Liminal”), merged with and into separate wholly owned subsidiaries of HealthCor and became wholly-owned subsidiaries of the Company (the “Mergers”), and changed their names to Hyperfine Operations, Inc. and Liminal Operations, Inc., respectively. Liminal subsequently changed its name to Liminal Sciences, Inc.

The Company is an innovative health technology business with a mission to revolutionize patient care globally through accessible, affordable, clinically relevant ultra-low-field (“ULF”) magnetic resonance (“MR”) brain imaging. The Company's Swoop® Portable MR Imaging® System (“Swoop® system”) produces high-quality images at a lower magnetic field strength than conventional magnetic resonance imaging (“MRI”) scanners. The Swoop® system is designed to transform brain MR for the patient, the clinician and the provider, and to provide a highly differentiated experience for patients, timely imaging to clinicians, and favorable economics for hospital administrators. The Swoop® system is a portable, ULF MRI device for producing images that display the internal structures of the head where full diagnostic examination is not clinically practical. When interpreted by a trained physician, these images provide information that can be useful in determining a diagnosis. Healthcare professionals can use the Swoop® system to make effective clinical diagnoses and decisions in various care settings where conventional MRI devices are inaccessible. The easy-to-use interface and portable design of the Company's Swoop® system make it easily and readily accessible anywhere in a hospital, clinic, or patient care site and it does not require any special facilities accommodations nor specialized personnel to operate safely. ULF MR does not expose patients to harmful ionizing radiation and compares favorably in this regard to X-ray computed tomography (“CT”) or positron emission tomography (“PET”). The Company's Swoop® system received initial 510(k) clearance for brain imaging from the U.S. Food and Drug Administration (“FDA”) in 2020. In February and October 2023, the Company received 510(k) clearances from the FDA of the latest updates to its Swoop® system AI-powered software. The combination of these two software updates significantly improved diffusion-weighted imaging (“DWI”), incorporated deep-learning based denoising in the post-processing of DWI images for crisper images, and improved image quality for all Swoop® system sequences. The Swoop® system has also received marketing authorization for brain imaging in several countries, including the European Union (CE certification), the United Kingdom (UK Conformity Assessment (“UKCA”)), Canada, Australia and New Zealand. All of the Company’s revenue to date has been generated from sales of the Swoop® system and related services. The Company has an indirect wholly-owned subsidiary in the United Kingdom that did not have any significant operations during 2023 nor the three months ended March 31, 2024.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Principles of Consolidation

The unaudited accompanying condensed consolidated financial statements include the accounts of the Company and have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the accounting disclosure rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. All intercompany transactions and balances have been eliminated.

These condensed consolidated financial statements should be read in conjunction with the financial statements and notes included in the Company’s audited consolidated financial statements as of and for the years ended December 31, 2023 and 2022. The condensed consolidated balance sheet as of December 31, 2023 included herein was derived from the audited consolidated financial statements as of that date.

HYPERFINE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(all amounts are in thousands, except share and per share amounts)

The accompanying condensed consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the financial position, results of operations, and cash flows for the interim periods. The results for the three months ended March 31, 2024 are not necessarily indicative of the results to be expected for any subsequent quarter, the year ending December 31, 2024, or any other period.

Except as described elsewhere in this Note 2 under the heading “Recently Issued Accounting Pronouncements”, there have been no material changes to the Company’s significant accounting policies as described in the audited consolidated financial statements as of December 31, 2023 and 2022.

Risks and Uncertainties

The Company is subject to risks and uncertainties caused by events with significant geopolitical and macroeconomic impacts, including, but not limited to, the conflicts in Ukraine and the Middle East, inflation and actions taken to counter such impacts. The Company relies on single source manufacturers and suppliers for the supply of its products. Disruption from these manufacturers or suppliers has and would have a negative impact on the Company’s business, financial position and results of operations in its consolidated financial statements. The Company continues to critically review its liquidity and anticipated capital requirements in light of the significant uncertainty created by geopolitical and macroeconomic conditions.

Concentrations of Credit Risk

The Company's cash and cash equivalents are deposited with several major financial institutions. At times, deposits in these institutions exceed the amount of insurance provided on such deposits. The Company reduces this risk by maintaining such deposits with high quality financial institutions that management believes are creditworthy and the Company monitors this credit risk and makes adjustments to the concentrations as necessary. The Company has not experienced any losses in such accounts and does not believe that it is exposed to any significant risk of loss on these balances.

With respect to accounts receivable, credit risk is mitigated by the Company’s ongoing credit evaluation of its customers’ financial condition. As of March 31, 2024 and December 31, 2023, the Company had three customers and two customers, respectively, that each accounted for more than 10% of trade receivables. With respect to revenues, three customers and one customer each accounted for more than 10% of revenues for the three months ended March 31, 2024 and 2023, respectively.

Segment Information

The Company’s Chief Operating Decision Maker (“CODM”) is its Chief Executive Officer (“CEO”). Substantially all of the Company’s long-lived assets are located in the United States. Other than $2,434 of revenue recognized in non-U.S. countries for the three months ended March 31, 2024, all of the revenues during this period were earned in the United States. Since the Company is aggregated into a single reportable segment, all required financial segment information is provided in the condensed consolidated financial statements.

Use of Estimates

The preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires the Company to make estimates and assumptions about future events that affect the amounts reported in its condensed consolidated financial statements and accompanying notes. Future events and their effects cannot be determined with certainty. On an ongoing basis, management evaluates these estimates and assumptions. Significant estimates and assumptions included:

•

Revenue recognition, including determination of the timing and pattern of satisfaction of performance obligations, determination of the standalone selling price (“SSP”) of performance obligations;

•

Allowance for credit losses;

•

Net realizable value (the selling price as well as estimated costs of disposal and transportation) of inventory, and demand and future use of inventory;

HYPERFINE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(all amounts are in thousands, except share and per share amounts)

•

Valuation allowances with respect to deferred tax assets; and

•

Assumptions underlying the fair value used in the calculation of stock-based compensation expense.

The Company bases these estimates on historical and anticipated results and trends and on various other assumptions that the Company believes are reasonable under the circumstances, including assumptions as to future events. Changes in estimates are recorded in the period in which they become known. Actual results could differ from those estimates, and any such differences may be material to the Company’s condensed consolidated financial statements.

Recently Issued Accounting Pronouncements

In December 2023, the Financial Accounting Standards Board (“FASB”) issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which enhances effective tax rate reconciliation disclosure requirements and provides clarity to the disclosures of income taxes paid, income before taxes and provision for income taxes. The amendments are effective for fiscal years beginning after December 15, 2024. Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance. The amendments in this update should be applied on a prospective basis. Retrospective application is permitted. The Company is currently evaluating this ASU to determine the impact of the amendments on the Company’s consolidated financial statements and disclosures.

In November 2023, the FASB issued ASU No. 2023-07 “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures.” This ASU expands public entities’ segment disclosures by requiring disclosure of significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items, and interim disclosures of a reportable segment’s profit or loss and assets. This ASU is effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024. This ASU is applicable to the Company’s Annual Report on Form 10-K for the fiscal year ending December 31, 2024, and subsequent interim periods, with early application permitted. The Company is currently evaluating the impact of adopting this ASU on its consolidated financial statements and disclosures.

Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the SEC have not had, or are not believed by management to have, a material impact on the Company’s present or future financial statements.

3. REVENUE RECOGNITION

Disaggregation of Revenue

The Company disaggregates revenue from contracts with customers by product type. The Company believes that these categories best represent the payor types by nature, amount, timing and uncertainty of its revenue streams. The following table summarizes the Company’s disaggregated revenues:


		Three Months Ended March 31,
	Pattern of Recognition	2024		2023
Device	Point in time	$	2,704	$	2,132
Service	Over time		591		503
Total revenue		$	3,295	$	2,635

HYPERFINE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(all amounts are in thousands, except share and per share amounts)

Contract Balances

Contract balances represent amounts presented in the condensed consolidated balance sheets when either the Company has transferred goods or services to the customer, or the customer has paid consideration to the Company under the contract. These contract balances include trade accounts receivable and deferred revenue. Deferred revenue represents consideration received from customers at the beginning of the subscription period for services that are transferred to the customer over the respective subscription period. The accounts receivable balances represent amounts billed to customers for goods and services where the Company has an unconditional right to payment of the amount billed.

The following table provides information about receivables and deferred revenue from contracts with customers:



	March 31, 2024		December 31, 2023
Accounts receivable, net	$	5,343	$	3,189
Unbilled receivables - current	$	895	$	942
Unbilled receivables - non-current(1)	$	909	$	1,044
Deferred revenue	$	1,527	$	1,453
Long term deferred revenue	$	1,021	$	968

______________________

(1) Recorded in other long term assets in the Company’s consolidated balance sheets.

The Company recognizes a receivable when it has an unconditional right to payment. Typical payment terms require the Company's customers to pay the Company within 30 days of invoice and up to less than one year based on the terms agreed upon with the respective customer.

Accounts Receivable, Unbilled Services, and Deferred Revenue

Accounts receivable are recorded at net realizable value. Unbilled receivables arise when performance obligations are satisfied for which revenue has been recognized but the customers have not been billed. Contractual provisions and payment schedules may or may not correspond to the timing of the performance of services under the contract.

Deferred revenue is a contract liability that consists of customer payments received in advance of performance and billings in excess of revenue recognized, net of revenue recognized from the balance at the beginning of the period.

The amount of revenue recognized during the three months ended March 31, 2024 and 2023 that was included in the deferred revenue balance at the beginning of the period was $493 and $430, respectively.

Timing of Billing and Performance

Difference in the timing of revenue recognition and associated billings and cash collections result in recording of billed accounts receivable, unbilled accounts receivable (including contract assets), and deferred revenue on the consolidated balance sheet. Amounts are billed in accordance with the agreed-upon contractual terms, resulting in recording unbilled accounts receivable in instances where the right to bill is contingent solely on the passage of time, and contract assets in instances where the right to consideration is conditional on something other than the passage of time.

Revenue from Leasing Arrangements

Revenue from leasing arrangements is not subject to the revenue standard for contracts with customers and remains separately accounted for under ASC 842, including leases for the three months ended March 31, 2024 and the year ended December 31, 2023. The Company records operating lease rental revenue as service revenue on a straight-line basis over the lease term. The Company recorded service revenue from lease arrangements of $82 and $114 for the three months ended March 31, 2024 and 2023, respectively. The Company records revenue from the sale of hardware devices under sales-type leases as device revenue in an amount equal to the present value of minimum

HYPERFINE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(all amounts are in thousands, except share and per share amounts)

lease payments at the inception of the lease. Sales-type leases also produce financing income, which is included in device revenue in the consolidated statements of operations and comprehensive loss and is recognized at effective rates of return over the lease term.

Costs of Obtaining or Fulfilling Contracts

The Company incurs incremental costs of obtaining contracts with customers. Incremental costs of obtaining contracts, which include commissions paid as a result of obtaining contracts with customers, are capitalized to the extent that the Company expects to recover such costs. Capitalized costs are amortized in a pattern that is consistent with the Company’s transfer to the customer of the related goods and services. Such costs are recorded in Other long term assets and were $378 and $391 as of March 31, 2024 and December 31, 2023, respectively. During the three months ended March 31, 2024 and 2023, the Company recognized $78 and $16, respectively, in expense related to the amortization of the capitalized contract costs.

Transaction price allocated to remaining performance obligations

As of March 31, 2024 and December 31, 2023, the Company had remaining performance obligations amounting to $5,618 and $5,661, respectively. The Company expects to recognize approximately 30% of its remaining performance obligations as revenue in fiscal year 2024, and an additional 70% in fiscal year 2025 and thereafter.

4. FAIR VALUE OF FINANCIAL INSTRUMENTS

Fair value estimates of financial instruments are made at a specific point in time, based on relevant information about financial markets and specific financial instruments. As these estimates are subjective in nature, involving uncertainties and matters of significant judgment, they cannot be determined with precision. Changes in assumptions can significantly affect estimated fair value.

The Company measures fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. The Company utilizes a three-tier hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value:

Level 1 — Valuations based on quoted prices in active markets for identical assets or liabilities that an entity has the ability to access.

Level 2 — Valuations based on quoted prices for similar assets or liabilities, quoted prices for identical assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets or liabilities.

Level 3 — Valuations based on inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company has no assets or liabilities valued with Level 3 inputs.

The carrying value of cash and cash equivalents, accounts payable and accrued expenses and other current liabilities approximates their fair values due to the short-term or on demand nature of these instruments.

The Company had no assets or liabilities classified as Level 2 or Level 3 and there were no transfers between fair value measurement levels during the three months ended March 31, 2024 and 2023.

The Company had $63,005 and $74,685 of money market funds, demand deposit and savings accounts included in cash and cash equivalents and restricted cash as of March 31, 2024 and December 31, 2023, respectively. These assets were valued using quoted prices in active markets and accordingly were classified as Level 1.

HYPERFINE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(all amounts are in thousands, except share and per share amounts)

5. INVENTORIES

A summary of inventories is as follows:


	March 31, 2024		December 31, 2023
Raw materials	$	2,617	$	1,757
Finished goods		4,681		4,825
Total inventories	$	7,298	$	6,582

Manufacturing overhead costs primarily include management’s best estimate and allocation of the labor costs incurred related to acquiring finished goods from the Company’s contract manufacturer. Labor costs include wages, taxes and benefits for employees involved in warehousing, logistics coordination, material sourcing, and production planning activities.

6. PROPERTY AND EQUIPMENT, NET

Property and equipment, net, are recorded at historical cost and consist of the following:


	March 31, 2024			December 31, 2023
Laboratory equipment	$	986		$	986
Research devices		1,679			1,532
Sales and marketing devices		490			490
Computer equipment		678			668
Construction in progress		1,335			595
Tooling		509			505
Trade show assets		254			254
Leased devices		397			397
Other		612			611
		6,940			6,038
Less: Accumulated depreciation and amortization		(3,234	)		(3,039	)
Property and equipment, net	$	3,706		$	2,999

Depreciation expense amounted to $263 and $254 for the three months ended March 31, 2024 and 2023, respectively.

7. RIGHT-OF-USE (“ROU”) ASSETS AND LEASES LIABILITIES

The Company has operating leases for its corporate offices, including its Palo Alto, California lease agreement which expires on April 30, 2025. As of March 31, 2024 the Palo Alto, California lease had an operating lease ROU assets of $194, current portion of operating lease liabilities of $189, and noncurrent portion of operating lease liabilities of $17, which are included in the Company's condensed consolidated balance sheets in other long term assets, accrued expenses and other current liabilities, and other noncurrent liabilities, respectively.

The weighted-average remaining lease term associated with the measurement of the Company's operating lease obligations is 13 months and the weighted-average discount rate is 7.9%.

The Company recorded short-term operating lease cost during the three months ended March 31, 2024 of $45. Cash paid for operating lease during the three months ended March 31, 2024 was $48.

Future minimum commitments due under the lease agreement as of March 31, 2024 are $165 for the remainder of 2024 and $50 thereafter.

HYPERFINE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(all amounts are in thousands, except share and per share amounts)

On March 1, 2024, the Company entered into a lease agreement for approximately 10,000 square feet of warehouse space in Guilford, Connecticut. The lease term is 12 months beginning March 1, 2024, and includes an option to renew for an additional one-year term at the then prevailing rental rate. The exercise of the lease renewal option is at the Company’s sole discretion. The Company applied ASC 842 practical expedient for short-term leases, which allows entities with leases of 12 months or shorter to not recognize ROU assets and lease liabilities for short-term leases. Future minimum commitments due under the lease agreement as of March 31, 2024, are $52 for the remainder of 2024 and $12 thereafter.

8. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Accrued expenses and other current liabilities consist of the following:



	March 31, 2024		December 31, 2023
Bonuses	$	1,012	$	2,463
Contracted services		1,894		1,237
Legal fees		339		412
Payroll and related benefits		1,072		676
Operating lease liabilities		189		185
Other		157		446
Total accrued expenses and other current liabilities	$	4,663	$	5,419

9. EQUITY INCENTIVE PLAN

The Company's 2021 Equity Incentive Plan (the “Hyperfine Plan”) is administered by the Company's board of directors and its compensation committee, which may grant restricted stock units (“RSUs”) and options to purchase shares either as incentive stock options or non-qualified stock options, and other stock-based awards. The option grants are subject to certain terms and conditions, option periods and conditions, exercise rights and privileges as set forth in the Hyperfine Plan.

Stock option activity

The following table summarizes the changes in the Company’s outstanding stock options for the three months ended March 31, 2024:


	Number of Options
Outstanding at January 1, 2024		14,271,587
Granted (1)		4,461,083
Exercised		(70,670	)
Forfeited / Cancelled / Expired		(181,006	)
Outstanding at March 31, 2024		18,480,994

_____________________________________________

(1)

Includes employee new hire grants of stock options to purchase 91,100 shares of the Company's Class A common stock. Also includes annual employee grants of stock options and special employee grants of stock options to purchase 1,934,983 shares of the Company's Class A common stock, and grants to executive officers of stock options to purchase 2,435,000 shares of the Company's Class A common stock. The grants will vest 25% on the first anniversary date of the grant with the remainder vesting equally over the remaining 36 months, subject to the employee’s continued service to the Company through the applicable vesting dates.

HYPERFINE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(all amounts are in thousands, except share and per share amounts)

In general, employee awards will vest based on continued service which is generally over four years. Nonemployee director awards generally will vest in one year based on continued service on the date of the next regular annual stockholders meeting. The grant date fair value of the award will be recognized as stock-based compensation expense over the requisite service period. The grant date fair value was determined using similar methods and assumptions as those previously disclosed by the Company.

Restricted stock unit activity

The following table summarizes the changes in the Company’s outstanding RSUs for the three months ended March 31, 2024:


	Number of RSUs
Outstanding at January 1, 2024		369,026
Granted		—
Vested		(41,036	)
Forfeited		(13,747	)
Outstanding at March 31, 2024		314,243

The following table presents details of stock-based compensation expenses by functional line item noted within the Company's operating expenses:


	Three Months Ended March 31,
	2024		2023
Cost of sales	$	24	$	23
Research and development		337		206
Sales and marketing		39		38
General and administrative		632		859
	$	1,032	$	1,126

10. NET LOSS PER SHARE

Basic net loss per share is computed by dividing the net loss by the weighted-average number of shares of common stock of the Company outstanding during the period. Diluted net loss per share is computed by giving effect to all common equivalent shares of the Company, including outstanding stock options, RSUs and Earn-Out Shares (defined below), to the extent dilutive. Basic and diluted net loss per share was the same for each period presented as the inclusion of all common equivalent shares of the Company outstanding would have been anti-dilutive.

The following table presents the calculation of basic and diluted net loss per share for the Company’s common stock:


	Three Months Ended March 31,
	2024			2023
Numerator:
Net Loss	$	(9,848	)	$	(12,160	)
Numerator for Basic and Dilutive EPS – Loss available to common stockholders	$	(9,848	)	$	(12,160	)
Denominator:
Common Stock		71,934,045			70,864,226
Denominator for Basic and Dilutive EPS - Weighted-average common stock		71,934,045			70,864,226
Basic and dilutive net loss per share	$	(0.14	)	$	(0.17	)

HYPERFINE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(all amounts are in thousands, except share and per share amounts)

Since the Company was in a net loss position for all periods presented, net loss per share attributable to Class A and Class B common stockholders was the same on a basic and diluted basis, as the inclusion of all common equivalent shares outstanding would have been anti-dilutive. Anti-dilutive common equivalent shares were as follows:


	Three Months Ended March 31,
	2024		2023
Outstanding options to purchase common stock		18,480,994		13,297,988
Outstanding RSUs		314,243		1,151,596
Earn-Out Shares (1)		9,357,835		9,400,616
Total anti-dilutive common equivalent shares		28,153,072		23,850,200

_________________________

(1) The Company will issue to holders of Legacy Hyperfine and Liminal securities as of immediately prior to the effective time of the Mergers, in accordance with their pro rata share, up to 10,000,000 shares of Class A common stock as earn-out consideration (the “Earn-Out Shares”) net of forfeitures, if at any time during the period between the Closing Date of December 22, 2021 and the third anniversary of the Closing Date (the “Earn-Out Period”), (i) the last share price of the Class A common stock is greater than or equal to $15.00 for any 20 trading days within any 30 consecutive trading day period, or (ii) there is a transaction that will result in shares of Class A common stock being converted or exchanged into the right to receive cash or other consideration having a value greater than or equal to $15.00. During the Earn-Out Period, if there is a transaction (other than for stock splits, stock dividends, special cash dividends, reorganizations, recapitalizations or similar transactions affecting the Class A common stock) that will result in the shares of Class A common stock being converted or exchanged into the right to receive cash or other consideration having a value less than $15.00, then the right to receive Earn-Out Shares will terminate.

11. INCOME TAXES

The Company accounts for income taxes under ASC 740, “Income Taxes” (“ASC 740”). ASC 740 requires the recognition of deferred tax assets and liabilities for both the expected impact of differences between the financial statement and tax basis of assets and liabilities and for the expected future tax benefit to be derived from tax loss and tax credit carry forwards. ASC 740 additionally requires a valuation allowance to be established when it is more likely than not that all or a portion of deferred tax assets will not be realized.

Income taxes for the three months ended March 31, 2024 and 2023 are recorded at the Company’s estimated annual effective income tax rate, subject to adjustments for discrete events, if they occur. The Company’s estimated annual effective tax rate was 0.0% for the three months ended March 31, 2024 and 2023. The primary reconciling items between the federal statutory rate of 21.0% for these periods and the Company’s overall effective tax rate of 0.0% were related to the effects of deferred state income taxes, research and development credits, stock-based compensation, and the valuation allowance recorded against the full amount of its net deferred tax assets.

A valuation allowance is required when it is more likely than not that some portion or all of the Company’s deferred tax assets will not be realized. The realization of deferred tax assets depends on the generation of sufficient future taxable income during the period in which the Company’s related temporary differences become deductible. The Company has recorded a full valuation allowance against its net deferred tax assets as of March 31, 2024 and 2023 since management believes that based on the earnings history of the Company, it is more likely than not that the benefits of these assets will not be realized.

12. RELATED PARTY TRANSACTIONS

The Company utilizes and subleases office and lab space in Connecticut, which is being leased from an unrelated landlord by 4Catalyzer Corporation (“4C”), which is owned by a related party. The Company pays rent to 4C on a month-to-month basis. A total of approximately $129 and $58 was paid during the three months ended March 31, 2024 and 2023, respectively.

Hyperfine entered into a Master Services Agreement (the “Master Services Agreements”) with 4C effective as of July 7, 2021 pursuant to which Hyperfine may engage 4C to provide services such as general administration,

HYPERFINE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(all amounts are in thousands, except share and per share amounts)

facilities, information technology, financing, legal, human resources and other services, through future statements of work and under terms and conditions to be determined by the parties with respect to any services to be provided. The Company paid an aggregate of $34 and $137 during the three months ended March 31, 2024 and 2023, respectively, under the Master Services Agreement. As of March 31, 2024 and December 31, 2023 there were $45 and $61 due to 4C, respectively, for expenses paid on the Company's behalf. These payables are included in due to related parties on the condensed consolidated balance sheet.

13. COMMITMENTS AND CONTINGENCIES

Commitments

The Company sponsors a 401(k) defined contribution plan covering all eligible U.S. employees. Contributions to the 401(k) plan are discretionary. The Company did not make any matching contributions to the 401(k) plan for the three months ended March 31, 2024 or 2023.

During 2020 and 2021, the Company was awarded multiple grants totaling $4,910 from the Bill & Melinda Gates Foundation (“BMGF”) for the provision and equipping of sites with the Company’s portable MR brain imaging system to enable the performance of a multi-site study focused on optimizing diagnostic image quality. These grants are designed to provide data to validate the use of the Swoop® system in measuring the impact of maternal anemia, malnutrition, infection and birth related injury. All of these grants are designed to support the deployment of a total of 25 Swoop® system devices and other services to investigators, which commenced in the spring of 2021. In March 2023, the term of the BMGF grant agreement was extended to February 2024. As of March 31, 2024 and December 31, 2023, 25 and 22 Swoop® system units, respectively, have been delivered to the BMGF. In May 2023, the Company was awarded an additional $3,354 grant from the BMGF to continue to develop a scalable approach to measuring neurodevelopment via low-field MRI in neonates, infants, and young children in low-to-middle income countries through February 2026. The funds are accounted for as restricted cash with a corresponding credit to deferred grant funding. Any grant funds, plus any interest income, that have not been used for, or committed to, the project must be returned promptly to the BMGF upon expiration of or termination of the agreement. During the three months ended March 31, 2024, the Company completed and delivered the remaining Swoop system® devices and delivered a grant milestone of a software update that provides faster scan times, additional system quality control tests, and other minor enhancements. The Company released $621 of restricted cash and recorded grant receivable of $470 excluding interest earned of $9, in prepaid expenses and other current assets in the condensed consolidated balance sheet. As of March 31, 2024 and December 31, 2023, there were no grant fund amounts that were required to be returned under the terms of the project.

Purchase Commitments

The Company’s purchase commitments and obligations include all open purchase orders and contractual obligations in the ordinary course of business, including commitments with contract manufacturers and suppliers, for which the Company has not received the goods or services. A majority of these purchase obligations are due within a year. Although open purchase orders are considered enforceable and legally binding, the terms generally allow the Company the option to cancel, reschedule, and adjust its requirements based on the Company’s business needs prior to the delivery of goods or performance of services.

Contingencies

The Company is, from time to time, a party to litigation that arises in the normal course of its business operations. The Company is not presently a party to any litigation for which it believes a loss is probable requiring an amount to be accrued or a possible loss contingency requiring disclosure.

HYPERFINE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(all amounts are in thousands, except share and per share amounts)

The Company has indemnification obligations under some agreements that the Company enters into with other parties in the ordinary course of business, including business partners, investors, contractors, and the Company’s officers, directors and certain employees. The Company has agreed to indemnify and defend the indemnified party against claims and related losses suffered or incurred by the indemnified party from actual or threatened third-party claims because of the Company’s activities or non-compliance with certain representations and warranties made by the Company. It is not possible to determine the maximum potential loss under these indemnification provisions due to the Company’s limited history of prior indemnification claims and the unique facts and circumstances involved in any particular case. The Company has not recorded any liability under such indemnification provisions within its condensed consolidated balance sheets. The Company is not aware of any claims or other circumstances that would give rise to material payments from the Company under such indemnification provisions.

The Company agreed to pay $1,000 to a third party service provider if the Company's pre-closing equity holders receive any Earn-Out Shares. As the Company has not met the criteria to trigger the earn-out, such payment is not determined to be probable and no liability was recognized within our condensed consolidated balance sheets. See Note 10. Net Loss Per Share, for further information regarding the earn-out criteria.

14. SUBSEQUENT EVENTS

The Company has evaluated subsequent events through the date the financial statements were issued and has determined that there were no subsequent events required to be disclosed.

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

The following discussion and analysis provides information which management believes is relevant to an assessment and understanding of our condensed consolidated results of operations and financial condition. The discussion should be read in conjunction with the unaudited condensed consolidated financial statements and notes thereto contained in this Quarterly Report on Form 10-Q and the consolidated financial statements and notes thereto for the year ended December 31, 2023 contained in our Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on March 22, 2024. This discussion contains forward-looking statements and involves numerous risks and uncertainties, including, but not limited to, those described in the “Risk Factors” sections of our Annual Report on Form 10-K for the year ended December 31, 2023, and of this Quarterly Report on Form 10-Q. Actual results may differ materially from those contained in any forward-looking statements. Unless the context otherwise requires, references to “we”, “us”, “our”, and “the Company” are intended to mean the business and operations of Hyperfine, Inc. and its consolidated subsidiaries. The unaudited condensed consolidated financial statements for the three months ended March 31, 2024 and 2023, respectively, present the financial position and results of operations of Hyperfine, Inc. and its wholly owned subsidiaries.

Overview

We are an innovative health technology business with a mission to revolutionize patient care globally through accessible, affordable, clinically relevant ultra-low-field (“ULF”) magnetic resonance (“MR”) brain imaging. Our Swoop® Portable MR Imaging® System (“Swoop® system”) produces high-quality images at a lower magnetic field strength than conventional magnetic resonance imaging (“MRI”) scanners. Our Swoop® system is designed to transform brain MR for the patient, the clinician and the provider, and to provide a highly differentiated experience for patients, timely imaging to clinicians, and favorable economics for hospital administrators. The Swoop® system is a portable, ULF MRI device for producing images that display the internal structures of the head where full diagnostic examination is not clinically practical. When interpreted by a trained physician, these images provide information that can be useful in determining a diagnosis. Healthcare professionals can use the Swoop® system to make effective clinical diagnoses and decisions in various care settings where conventional MRI devices are inaccessible. The easy-to-use interface and portable design of our Swoop® system make it easily and readily accessible anywhere in a hospital, clinic, or patient care site and it does not require any special facilities accommodations nor specialized personnel to operate safely. ULF MR does not expose patients to harmful ionizing radiation and compares favorably in this regard to X-ray computed tomography (“CT”) or positron emission tomography (“PET”).

The demand for MR imaging has been increasing due to the aging population and the rising prevalence of neurological, neurodegenerative, and cardiovascular conditions, as well as the trends towards decentralized healthcare in mature as well as low- and middle-income countries. Healthcare professionals and insurers recognize imaging as an effective, non-invasive diagnostic tool for evaluation and ongoing monitoring. The Swoop® system is the next generation brain imaging device designed to increase access to MRI in a cost-effective manner and expand the current $35 billion imaging market.

Despite their advantages, many healthcare institutions worldwide lack the facilities, specialized operators, and capital necessary to acquire and maintain expensive conventional MRI devices. The Swoop® system is the first U.S. Food and Drug Administration (“FDA”)-cleared, portable, ULF, MR brain imaging system and is capable of providing imaging at multiple sites of care, such as intensive care units, clinics, emergency departments or physicians’ offices, and can inform the timely detection, diagnosis, monitoring, and treatment of acute and chronic conditions inside and outside the hospital. We designed the Swoop® system to address the limitations of conventional imaging technologies and make MR brain imaging accessible nearly anytime and anywhere across professional healthcare settings. We believe the adoption of the Swoop® system by healthcare professionals has clinical and economic benefits throughout healthcare communities in both high and low resource settings.

The Swoop® system is AI-powered and integrates deep learning, a form of AI, for the reconstruction and denoising of T1, T2, and fluid-attenuated inversion recovery (“FLAIR”) sequences. The Swoop® system also incorporates deep learning denoising in the diffusion-weighted imaging (“DWI”) sequences for image post-processing. The integration of deep learning does not require any additional steps from the user. As a result, deep learning can enhance the image quality and, consequently, the diagnostic value of images generated at ULF. The algorithms are designed to improve ULF image quality, while reducing the impact of scan artifacts. The images created with these algorithms were validated by expert radiologists. The Swoop® system is used clinically every day as the first mover

in the field of portable ULF MRI, and with an install base that continues to expand. The learnings from this field experience has served to improve our software, AI, and denoising algorithms resulting in the image quality and performance improvements of our product over the eight software releases since our initial clearance. As we move forward, we are continuously investing in improving our AI-powered image quality and leveraging each imaging-focused software release to further improve the Swoop® system performance.

Legacy Hyperfine received initial 510(k) clearance for brain imaging of patients of all ages from the FDA in 2020 and has now received eight subsequent clearances from the FDA after the initial clearance. We received our most recent clearance from the FDA in October 2023 for the latest update of our Swoop® system AI-powered software. This updated software expanded the Swoop® system’s AI denoising capabilities by incorporating deep learning denoising in the DWI sequence for image post-processing. In February and October 2023, we received 510(k) clearances from the FDA for the latest updates to our Swoop® system AI-powered software. The combination of these two software updates significantly improved DWI, incorporated deep-learning based denoising in the post-processing of DWI images for crisper images, and improved image quality for all Swoop® system sequences. The Swoop® system has also received marketing authorization for brain imaging in several countries, including the European Union (CE), the United Kingdom (UKCA), Canada, Australia and New Zealand.

Key Performance Measures

Management reviews and analyzes several key performance measures including Total revenues and Total Swoop® system units sold. These measures are reviewed and analyzed to evaluate our business performance, identify trends affecting our business, allocate capital, and make strategic decisions.

Total revenues were $3.3 million for the three months ended March 31, 2024, an increase of $0.7 million, or 25.0% from the three months ended March 31, 2023, primarily driven by increases in Swoop® system units sold and service revenues. See "Results of Operations - Sales" below for further information. Total Swoop® system units sold were 13 units for the three months ended March 31, 2024, an increase of 3 units, or 30.0% from the three months ended March 31, 2023.

Factors Affecting Results of Operations

The following factors have been important to our business and we expect them to impact our results of operations and financial condition in future periods:

Technical innovation

We have developed our Swoop® system through extensive research and development activities. Moreover, our team is dedicated to clinical support programs designed to integrate the Swoop® system into an array of diverse healthcare environments and applications. We believe that, from our commercial and clinical experience, we are gaining invaluable insights into the Swoop® system’s feasibility. We believe these learnings will enable us to further improve our product and develop new services and tools in the future. We are continuously improving our image quality and imaging capabilities. Building upon this foundation and our expertise in ULF brain imaging, we plan to develop new imaging applications, broadening the range of clinical uses for our technology. Additionally, we are leveraging our strengths in AI and cloud technology to explore the Swoop® system’s role as a brain imaging clinical decision support platform. While these technical innovations may increase our research and development expenses, we expect them to have a positive impact on our results of operations and profitability in the future.

Commercialization efforts of the Swoop® system

Our results have included revenue from outside the United States and outside the United States. Legacy Hyperfine received initial 510(k) clearance from the FDA in 2020. We are focused on building relationships and executing contracts with U.S. hospital systems. We are building a direct sales and field support organization in the United States and have recently made changes within our sales and clinical support teams who are working in strong collaboration to increase adoption, support successful implementations and support routine use at customer sites. As of 2024, we have targeted a select number of international markets to add to our commercial efforts operating through distributors.

Expand sales in international markets

The countries in which we have begun commercializing our Swoop® system include Canada, Australia, and New Zealand. We obtained a Medical Device License issued by Health Canada, UKCA certification in the United Kingdom, CE certification in the EU and regulatory authorization in Australia and New Zealand. In 2024, we have plans to expand our international commercial focus to select international countries.

While we will maintain our commercial focus in the United States in 2024, our commitment to the vision of providing affordable and accessible imaging that enables earlier detection and timely management of health conditions worldwide is currently made possible by grant funding from the BMGF. Through our engagement with the BMGF, we have deployed and continue to deploy the Swoop® system in low-middle income settings without readily-accessible MRI technology. The multiple grants provided by our research partnership with the BMGF, which commenced funding in the spring of 2020, support the deployment of 25 Swoop® system and accessories to investigators. As of March 31, 2024 and December 31, 2023, 25 and 22 Swoop® system units, respectively, have been delivered to the BMGF. The ongoing investigation is designed to provide data to validate the potential use of the Swoop® system in measuring the impact of maternal anemia, malnutrition, infection, and birth-related injury. In May 2023, we were awarded an additional 3-year grant from the BMGF to continue to develop a scalable approach to measuring neurodevelopment via ULF brain imaging in neonates, infants, and young children in low-to-middle income countries. During the three months ended March 31, 2024, we completed and delivered the remaining Swoop system® devices and delivered a grant milestone of a software update that provides faster scan times, additional system quality control tests, and other minor enhancements, we released $0.6 million of restricted cash and recorded grant receivable of $0.5 million excluding interest earned, in prepaid expenses and other current assets in our condensed consolidated balance sheet.

Results of Operations

The following is a discussion of our results of operations for the three months ended March 31, 2024 and 2023. Our accounting policies are described under "Summary of Significant Accounting Policies" in Note 2 to our unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q.


	Three Months Ended March 31,						Change
($ Amounts in thousands)	2024			2023			%
Sales
Device	$	2,704		$	2,132			26.8	%
Service		591			503			17.5	%
Total sales		3,295			2,635			25.0	%
Cost of Sales
Device		1,499			1,071			40.0	%
Service		442			409			8.1	%
Cost of sales		1,941			1,480			31.1	%
Gross margin		1,354			1,155			17.2	%
Operating expenses:
Research and development		5,570			5,461			2.0	%
General and administrative		4,430			6,182			(28.3	)%
Sales and marketing		2,004			2,547			(21.3	)%
Total operating expenses		12,004			14,190			(15.4	)%
Loss from operations		(10,650	)		(13,035	)		(18.3	)%
Interest income		796			869			(8.4	)%
Other income, net		6			6			—	%
Loss before provision for income taxes		(9,848	)		(12,160	)		(19.0	)%
Provision for income taxes		—			—
Net loss and comprehensive loss	$	(9,848	)	$	(12,160	)		(19.0	)%

Comparison of the Three Months Ended March 31, 2024 and 2023 ($ Amounts shown in tables in thousands)

Sales


	Three Months Ended March 31,				Change
	2024		2023		Amount		%
Device	$	2,704	$	2,132	$	572		26.8	%
Service		591		503		88		17.5	%
Total sales	$	3,295	$	2,635	$	660		25.0	%

Device sales increased by $0.6 million, or 26.8%, for the three months ended March 31, 2024 compared to the three months ended March 31, 2023. This increase was driven primarily by an increase in the volume of device sales.

Service sales increased by $0.1 million, or 17.5%, for the three months ended March 31, 2024 compared to the three months ended March 31, 2023. This increase was driven by an increase in the volume of commercial system units installed as generally all commercial systems installations generate recurring service revenue. Service sales revenue is generally recognized over time as we are providing the customer with ongoing access to our resources and software upgrades throughout the subscription period. This type of revenue is recurring in nature and we expect will continue to grow as more devices are sold.

Cost of sales


	Three Months Ended March 31,				Change
	2024		2023		Amount		%
Device	$	1,499	$	1,071	$	428		40.0	%
Service		442		409		33		8.1	%
Total cost of sales	$	1,941	$	1,480	$	461		31.1	%

Cost of device sales increased by $0.4 million, or 40.0%, for the three months ended March 31, 2024 compared to the three months ended March 31, 2023. This increase was driven primarily by an increase in units sold.

Cost of service sales increased by $33 thousand, or 8.1%, for the three months ended March 31, 2024 compared to the three months ended March 31, 2023. This increase is due to the increased install base.

Research and development


	Three Months Ended March 31,				Change
	2024		2023		Amount		%
Research and development	$	5,570	$	5,461	$	109		2.0	%

Research and development expenses increased by $0.1 million, or 2.0%, for the three months ended March 31, 2024 compared to the three months ended March 31, 2023. This increase was driven primarily by an increase in personnel related costs of $0.7 million as a result of increased headcount and an increase in consulting costs of $0.3 million, partially offset by $0.9 million of higher grant fulfilments recorded as credits to research and development expenses.

General and administrative


	Three Months Ended March 31,				Change
	2024		2023		Amount			%
General and administrative	$	4,430	$	6,182	$	(1,752	)		(28.3	)%

General and administrative expenses decreased by $1.8 million, or 28.3%, for the three months ended March 31, 2024 compared to the three months ended March 31, 2023. This decrease was driven primarily by a decrease in personnel related costs and stock-based compensation expenses of $1.0 million as a result of a lean executive team, a decrease in accounting, auditing and SEC expenses of $0.3 million, a decrease in insurance expenses of $0.1 million, a decrease in legal expenses and legal related expenses of $0.3 million, and a decrease in recruitment expenses of $0.1 million.

Sales and marketing


	Three Months Ended March 31,				Change
	2024		2023		Amount			%
Sales and marketing	$	2,004	$	2,547	$	(543	)		(21.3	)%

Sales and marketing expenses decreased by $0.5 million, or 21.3%, for the three months ended March 31, 2024 compared to the three months ended March 31, 2023. This decrease was driven primarily by a decrease in personnel related costs of $0.2 million, a decrease in digital marketing and marketing events costs of $0.2 million, and a decrease in software related expenses of $0.1 million.

Interest income


	Three Months Ended March 31,				Change
	2024		2023		Amount			%
Interest income	$	796	$	869	$	(73	)		(8.4	)%

Interest income decreased by $73 thousand for the three months ended March 31, 2024 compared to the three months ended March 31, 2023. The decrease was driven primarily by lower cash balances in money market funds and demand deposit accounts during the three months ended March 31, 2024 compared to the three months ended March 31, 2023.

Other income, net


	Three Months Ended March 31,				Change
	2024		2023		Amount		%
Other income, net	$	6	$	6	$	—		—	%

Other income, net was unchanged for the three months ended March 31, 2024 compared to the three months ended March 31, 2023. Other income, net during the three months ended March 31, 2024 was $6 thousand consisting primarily of interest income from customer financing of approximately $24 thousand, offset by a net realized loss on foreign currencies of approximately $14 thousand and other expenses of $4 thousand.

Liquidity and Capital Resources

We have funded our operations primarily with proceeds from the issuance of common and preferred stock. We have incurred significant cash burn and recurring net losses, which includes a net loss of $9.8 million for the three months ended March 31, 2024, and an accumulated deficit of $263.6 million as of March 31, 2024. As of March 31, 2024, we had cash and cash equivalents of $63.2 million. As we continue to invest in research and development of our products and sales and marketing, we expect to continue to incur a significant cash burn and recurring net losses for the foreseeable future until such time that our product and services sales generate enough gross profit to cover our operating expenses. However, we can provide no assurance that our product and service sales will generate a net profit in the future or that our cash resources will be sufficient to continue our commercialization and development activities.

In November 2023, we filed a shelf registration statement on Form S-3 with the SEC pursuant to which we registered for sale up to $150 million of any combination of our Class A common stock, preferred stock, debt securities, warrants, rights and/or units from time to time and at prices and on terms that we may determine. Our shelf registration statement on Form S-3 also included a prospectus (the “Sales Agreement Prospectus”) covering up to an aggregate of $50.0 million in shares of Class A common stock that we may issue and sell from time to time, through B. Riley Securities, Inc. (“B. Riley”) acting as our sales agent, pursuant to the sales agreement that we entered into with B. Riley in November 2023 (the “Sales Agreement”), for our “at-the-market” equity program. We are not obligated to make any sales of Class A common stock under the Sales Agreement. As of March 31, 2024, we had not sold any Class A common stock pursuant to the Sales Agreement. As of the filing of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, we are subject to the SEC general instructions of Form S-3 known as the “baby shelf rules.” Under these instructions, the amount of funds we can raise through primary public offerings of securities in any 12-month period using our registration statement on Form S-3 is limited to one-third of the aggregate market value of the shares of our common stock held by non-affiliates. Therefore, we are limited in the amount of proceeds we are able to raise by selling shares of our common stock using our Form S-3, including under the Sales Agreement, until such time as our public float exceeds $75 million. On March 22, 2024, we filed an amendment to the Sales Agreement Prospectus, pursuant to which, as of such date, we may offer and sell shares of our Class A common stock having an aggregate offering price of up to $22.8 million from time to time through or to B. Riley.

Our ability to access capital when needed is not assured and, if capital is not available when, and in the amounts needed, we could be required to delay, scale back or abandon some or all of our development programs, commercialization of our products, and other operations which could materially harm our operations, financial condition and operating results. We expect that our existing cash and cash equivalents, together with proceeds from the sales of our products and services, will enable us to conduct our planned operations for at least the next 12 months. Factors that could accelerate cash needs include: (i) delays in achieving scientific and technical milestones; (ii) unforeseen capital expenditures and fabrication costs related to manufacturing; (iii) changes we may make in our business or commercialization and hiring strategy; (iv) costs of running a public company; (v) higher inflation and increases in product transportation and labor costs; and (vi) other items affecting our forecasted level of expenditures and use of cash resources including potential acquisitions.

We expect to use our cash to further invest in the development of our products and services, commercial expansion, and for working capital and general corporate purposes.

Our future cash requirements will depend on many factors, including market adoption of our products; the cost and timing of establishing additional sales, marketing and distribution capabilities; the cost of our research and development activities; our ability to enter into and maintain collaborations; the cost and timing of potential future regulatory clearances or approvals for our products; and the effect of competing technological and market developments. We cannot assure you that we will be able to obtain additional funds on acceptable terms, or at all. If we raise additional funds by issuing equity or equity-linked securities, our stockholders may experience dilution. Future debt financing, if available, may involve covenants restricting our operations or our ability to incur additional debt. Any debt or equity financing that we raise may contain terms that are not favorable to us or our stockholders. If we raise additional funds through collaboration and licensing arrangements with third parties, it may be necessary to relinquish some rights to our technologies or our products, or grant licenses on terms that are not favorable to us. If we do not have or are not able to obtain sufficient funds, we may have to delay development or commercialization of our products. We also may have to reduce marketing, customer support or other resources devoted to our products and services or cease operations.

Cash

As of March 31, 2024, we had cash and cash equivalents of $63.2 million. Our future capital requirements may vary from those currently planned and will depend on various factors including further development costs, commercialization strategy, international expansion, and regulatory costs. If we need additional funds and are unable to obtain funding on a timely basis, we may need to curtail significantly our product development and commercialization efforts to provide sufficient funds to continue our operations, which could adversely affect our business prospects.

Cash flows

The following table summarizes our cash flows for the periods indicated:


	Three Months Ended March 31,
(In thousands)	2024			2023
Net cash used in operating activities	$	(12,510	)	$	(13,491	)
Net cash used in investing activities		(145	)		(61	)
Net cash provided by financing activities		55			49
Net decrease in cash, cash equivalents, and restricted cash	$	(12,600	)	$	(13,503	)

Net cash used in operating activities

For the three months ended March 31, 2024, net cash used in operating activities of $12.5 million was due primarily to a net loss of $9.8 million and changes in operating assets and liabilities of $4.0 million, partially offset by non-cash items of $1.3 million. Non-cash items were primarily stock-based compensation expense of $1.0 million and depreciation expense of $0.3 million. Changes in operating assets and liabilities were driven primarily by an increase in accounts receivable of $2.1 million due to timing of billing and collection, a decrease in accrued expenses and other current liabilities of $1.4 million mainly due to annual bonus payout, an increase in prepaid expenses and other current assets of $1.3 million mainly due to the timing of payment of the directors and officers insurance and the recording of a grant receivable, an increase in inventory of $0.8 million, a decrease in deferred grant funding of $0.6 million due to fulfillment and delivery of a BMGF grant milestone related to a delivery of an enhanced version of our software, partially offset by an increase in accounts payable of $1.2 million, a decrease in prepaid inventory of $0.7 million, a decrease in other long term assets of $0.2 million, and an increase in deferred revenue of $0.1 million.

For the three months ended March 31, 2023, net cash used in operating activities of $13.5 million was due primarily to a net loss of $12.2 million and changes in operating assets and liabilities of $2.7 million, partially offset by non-cash items of $1.4 million. Non-cash items were primarily stock-based compensation expense of $1.1 million and depreciation expense of $0.3 million. Changes in operating assets and liabilities were driven primarily by a decrease in accrued expenses and other liabilities of $1.8 million mainly driven by annual bonus payout and lower payroll and related benefits accrual, an increase in inventory of $1.1 million, an increase in accounts receivable of $0.9 million, an increase in unbilled receivables of $0.3 million, a decrease in deferred grant funding of $0.1 million, a decrease in deferred revenue of $0.1 million, partially offset by an increase in accounts payable of $1.0 million, a decrease in prepaid expenses and other current assets of $0.3 million, a decrease in prepaid inventory of $0.3 million.

Net cash used in investing activities

For the three months ended March 31, 2024, net cash used in investing activities of $142 thousand was from fixed assets purchased.

For the three months ended March 31, 2023, net cash used in investing activities of $61 thousand was from fixed assets purchased.

Net cash provided by financing activities

For the three months ended March 31, 2024, net cash provided by financing activities of $55 thousand was proceeds from option exercises.

For the three months ended March 31, 2023, net cash provided by financing activities of $49 thousand was proceeds from option exercises.

Contractual obligations

We sponsor a 401(k) defined contribution plan covering all eligible U.S. employees. Contributions to the 401(k) plan are discretionary. We did not make any matching contributions to the 401(k) plan for the three months ended March 31, 2024 and 2023.

Through our engagement with the BMGF, we have deployed and continue to deploy the Swoop® system in low-middle income settings without readily-accessible MRI technology. The multiple grants provided by our research partnership with the BMGF, which commenced funding in the spring of 2020, support the deployment of 25 Swoop® system and accessories to investigators. As of March 31, 2024 and December 31, 2023, 25 and 22 Swoop® system units, respectively, were delivered to the BMGF. The ongoing investigation is designed to provide data to validate the potential use of the Swoop® system in measuring the impact of maternal anemia, malnutrition, infection, and birth-related injury. In May 2023, we were awarded an additional 3-year grant from the BMGF to continue to develop a scalable approach to measuring neurodevelopment via ULF brain imaging in neonates, infants, and young children in low-to-middle income countries.

Our purchase commitments and obligations include all open purchase orders and contractual obligations in the ordinary course of business, including commitments with contract manufacturers and suppliers, for which we have not received the goods or services. A majority of these purchase obligations are due within a year. Although open purchase orders are considered enforceable and legally binding, the terms generally allow us the option to cancel, reschedule, and adjust our requirements based on our business needs prior to the delivery of goods or performance of services.

We had no other significant contractual obligations as of March 31, 2024.

For information on contingencies, refer to Note 13 in the notes to our unaudited condensed consolidated financial statements for the three months ended March 31, 2024 and 2023 included elsewhere in this Quarterly Report on Form 10-Q.

Critical Accounting Policies and Significant Judgments and Estimates

Our management's discussion and analysis of our financial condition and results of operations is based on our condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The preparation of these condensed consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, as well as the reported revenue generated and expenses incurred during the reporting periods. Our estimates are based on our historical experience and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about items that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

Except as described in Note 2 “Summary of Significant Accounting Policies – Recently Issued Accounting Pronouncements”, to our unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q, there have been no material changes to our critical accounting policies and estimates as compared to the critical accounting policies and estimates disclosed in our Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC on March 22, 2024.

Recently Issued Accounting Pronouncements

A description of recently issued accounting pronouncements that may potentially impact our financial position and results of operations is disclosed in Note 2 to our unaudited condensed consolidated financial statements and notes thereto for the three months ended March 31, 2024 and 2023 included elsewhere in this Quarterly Report on Form 10-Q.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

We are exposed to market risk in the ordinary course of business. Market risk represents the risk of loss that may impact our results of operations or financial position due to adverse changes in financial market prices and rates. Our market risk exposure is primarily a result of fluctuations in interest rates, inflation risk, and foreign exchange risk. We do not hold, issue or enter into any financial instruments for speculative or trading purposes. We do not have significant exposure to foreign currencies.

Interest Rate Risk

Our cash, cash equivalents and restricted cash as of March 31, 2024 consisted of $63.2 million in money market funds, demand deposit and savings accounts. Such interest-earning instruments carry a degree of interest rate risk. The goals of our investment policy are liquidity and capital preservation. We believe that we do not have any material exposure to changes in the fair value of these assets as a result of changes in interest rates due to the short-term nature of our cash equivalents. Based on our balance sheet position at March 31, 2024, the annualized effect of a 0.5 percentage point decrease in interest rates would be to decrease earnings before income taxes by $0.3 million.

Inflation Risk

We do not believe that inflation has had a material effect on our business, financial condition, or results of operations, other than its impact on the general economy. Nonetheless, if our costs were to become subject to inflationary pressures, we might not be able to fully offset such higher costs through price increases. Our inability or failure to do so could harm our business, financial condition, and results of operations.

Foreign Exchange Risk

We operate our business primarily within the United States and currently execute the majority of our transactions in U.S. dollars. We have not utilized hedging strategies with respect to such foreign exchange exposure. This limited foreign currency translation risk is not expected to have a material impact on our condensed consolidated financial statements.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our principal executive officer and principal financial officer evaluated the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of March 31, 2024. Based upon that evaluation, our principal executive officer and principal financial officer have concluded that, as of March 31, 2024, the end of the period covered by this report, our disclosure controls and procedures were effective at a reasonable assurance level 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 officer and principal financial officer, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting, identified in connection with the evaluation of such internal control that occurred during the three months ended March 31, 2024, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II — OTHER INFORMATION

Item1. Legal Proceedings

We are not currently a party to any material legal proceedings.

Item 1A. Risk Factors

Our business, results of operations and financial condition are subject to various risks and uncertainties including the risk factors described under the caption “Risk Factors” in our most recent Annual Report on Form 10-K, filed with the SEC on March 22, 2024 (the “2023 Annual Report on Form 10-K”). There have been no material changes to the risk factors described in the 2023 Annual Report on Form 10-K.

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

Unregistered Sales of Equity Securities and Use of Proceeds

Not applicable.

Issuer Purchases of Equity Securities

We did not repurchase any of our equity securities during the three months ended March 31, 2024.

Item 3. Defaults Upon Senior Securities

Not applicable.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

10b5-1 Trading Arrangements

From time to time, our officers (as defined in Rule 16a-1(f) of the Exchange Act) and directors may enter into Rule 10b5-1 or non-Rule 10b5-1 trading arrangements (as each such term is defined in Item 408 of Regulation S-K). During the three months ended March 31, 2024, none of our officers or directors adopted, modified or terminated any such trading arrangements.

Item 6. Exhibits

See Exhibit Index.

EXHIBIT INDEX


Exhibit Number	Exhibit Description	Filed Herewith	Incorporated by Reference herein from Form or Schedule	Filing Date	SEC File/ Reg. Number
10.1+	Nonemployee Director Compensation Policy, As Amended.	X
10.2	Master Services Agreement, by and between Hyperfine Operations, Inc. (formerly Hyperfine, Inc.) and 4Catalyzer Corporation, dated July 7, 2021.	X
31.1	Certification of the Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.	X
31.2	Certification of the Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.	X
32*	Certifications of the Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.	X
101.INS	Inline XBRL Instance Document - The instance document does not appear in the Interactive Data File because its Inline XBRL tags are embedded within the Inline XBRL document.	X
101.SCH	Inline XBRL Taxonomy Extension Schema Document.	X
104	Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101).	X

+ Management contract or compensatory plan or arrangement.

* 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 Hyperfine, Inc. 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 this Form 10-Q, irrespective of any general incorporation language contained in such filing.

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.


		HYPERFINE, INC.
Date: May 14, 2024		By: /s/ Maria Sainz
		Maria Sainz
		President and Chief Executive Officer

Date: May 14, 2024		By: /s/ Brett Hale
		Brett Hale
		Chief Administrative Officer, Chief Financial Officer, Treasurer and Corporate Secretary

Exhibit 10.1

HYPERFINE, INC.

NONEMPLOYEE DIRECTOR COMPENSATION POLICY

(Adopted December 22, 2021, As Amended April 1, 2024)

The Board of Directors of Hyperfine, Inc. (the “Company”) has approved the following Nonemployee Director Compensation Policy (this “Policy”) to provide an inducement to obtain and retain the services of qualified persons to serve as members of the Company’s Board of Directors. The Policy establishes compensation to be paid to nonemployee directors of the Company.

Applicable Persons

This Policy shall apply to each director of the Company who is not an employee of the Company or any Affiliate (each, an “Outside Director”). “Affiliate” shall mean an entity which is a direct or indirect parent or subsidiary of the Company, as determined pursuant to Section 424 of the Internal Revenue Code of 1986, as amended.

Compensation

Equity Grants

Annual Grants

Each Outside Director shall be granted, automatically and without any action on the part of the Board of Directors, under the Company’s 2021 Equity Incentive Plan or a successor plan (the “Equity Plan”), non-qualified stock options (“Options”) to purchase 79,200 shares of the Company’s Class A common stock, par value $0.0001 per share (the “Common Stock”), each year beginning in 2024 on the first business day after the Company’s annual meeting of stockholders (the “Annual Grant”).

Initial Grants for Newly Appointed or Elected Directors

Each new Outside Director (including any Outside Director whose election to the Board of Directors was approved at the Company’s special meeting of stockholders on December 21, 2021) shall be granted, under the Equity Plan, a number of restricted stock units (“RSUs”) (each RSU relating to one share of Common Stock) or other equity award, as determined by the Board of Directors in connection with the initial appointment or election of such Outside Director to the Board of Directors, on the first business day after the date that the Outside Director is first appointed or elected to the Board of Directors (the “Initial Grant” and, together with the Annual Grants, the “Outside Director Grants”).

 Terms of Outside Director Grants

Unless otherwise specified by the Board of Directors or the Compensation Committee at the time of grant, each Outside Director Grant shall: (i) vest, in the case of (A) an Annual Grant, at the end of the “Directors’ Compensation Year,” which shall be defined as the period beginning on the date of each regular Annual Stockholders Meeting and ending on the date of the next regular Annual Stockholders Meeting, subject to the Outside Director’s continued service on the Board of Directors through the applicable Directors’ Compensation Year, and (B) an Initial Grant, in equal annual installments over three years from the date of the grant, subject to the Outside Director’s continued service on the Board of Directors on the applicable vesting dates; and (ii) be granted under the Company’s standard form of agreement unless on or prior to the date of grant the Board of Directors or the Compensation Committee shall determine that other terms or conditions shall be applicable.

Cash Fees

Annual Cash Fees

Each Outside Director will receive an annual cash retainer fee in the amount of $50,000, the Chairperson of the Board of Directors will receive an additional annual cash retainer fee in the amount of $40,000, and the following additional annual cash fees shall be paid to the Outside Directors serving on the Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee, as applicable (collectively, the “Annual Fees”).


Committee of Board of Directors	Annual Retainer Amount for Chair		Annual Retainer Amount for Other Members
Audit Committee	$	20,000	$	10,000
Compensation Committee	$	15,000	$	7,500
Nominating and Corporate Governance Committee	$	10,000	$	5,000

Payment Terms for All Cash Fees

Annual Fees payable to Outside Directors shall be paid quarterly in arrears as soon as practicable following the last business day of each fiscal quarter.

Following an Outside Director’s first election or appointment to the Board of Directors, such Outside Director shall receive his or her cash compensation prorated during the first fiscal quarter in which he or she was initially appointed or elected for the number of days during which he or she provides service. If an Outside Director dies, resigns, or is removed during any quarter, he or she shall be entitled to a cash payment on a prorated basis through his or her last day of service that shall be paid as soon as practicable following the last business day of the fiscal quarter.

Expenses

Upon presentation of documentation of such expenses reasonably satisfactory to the Company, each Outside Director shall be reimbursed for his or her reasonable out-of-pocket business expenses incurred in connection with attending meetings of the Board of Directors and Committees thereof or in connection with other business related to the Board of Directors. Each Outside Director shall abide by the Company’s travel and other expense policies applicable to Company personnel.

Amendments

The Compensation Committee or the Board of Directors shall review this Policy from time to time to assess whether any amendments in the type and amount of compensation provided herein should be adjusted in order to fulfill the objectives of this Policy.

Exhibit 10.2

MASTER SERVICES AGREEMENT

This Master Services Agreement (“Agreement”) is effective as of July 7, 2021 (“Effective Date”), and is by and between Hyperfine, Inc. (“Client”) and 4Catalyzer Corporation (“Company”).

Client and Company enter into this Master Services Agreement for the purpose of setting forth the terms and conditions upon which Client may engage Company to provide services as requested by Client from time to time. As a master contract, this Agreement allows the parties to contract for multiple projects through the issuance of individual statements of work without the need to renegotiate the basic terms and conditions contained herein.

Therefore, in consideration of the mutual promises, covenants and agreements stated below, and intending to be legally bound, the parties agree as follows:

Services.

1.1.

Statements of Work. Company shall provide to Client with the services as set forth on Client’s purchase orders or mutually executed statements of work (each a “SOW”) as requested by Client from time to time (“Services”). Each SOW shall be substantially in the form as set forth in Attachment A (Statement of Work Template). Company shall perform such Services (i) in compliance with all Applicable Laws, rules and regulations (“Applicable Laws”); (ii) in compliance with any additional policies specified by Client and provided to Company; and (iii) with care, skill, and diligence and in accordance with generally accepted industry standards and practices.

1.2.

Designated Representative. Company will assign one or more designated representatives to manage assigned Client projects and serve as the point of contact for training requirements and specified performance obligations. If Client requests that Company replace or reassign its designated representative, or any other Employee directly involved in performing the Services, then Company shall replace or reassign such person as soon as practicable. Company shall use commercially reasonable efforts to maintain its designated representative for Client’s account, and shall not reassign or replace such person with less than 60 days’ notice to Client, unless such person is no longer able to perform such person’s duties as the designated representative.

1.3.

Subcontractors and Affiliates. Company may engage subcontractors or Company Affiliates to perform Services, at no additional cost to Client, provided that: (i) Company shall seek and obtain Client’s prior written approval for the appointment of any such subcontractor or Affiliate to perform activities in connection with the Services; (ii) the subcontractor or Affiliate shall be contractually bound by confidentiality and intellectual property provisions at least as stringent as those to which Company is subject under this Agreement; (iii) Company shall not be relieved of any responsibilities or obligations under this Agreement as a result of subcontracting its obligations under this Agreement; (iv) Company shall remain Client’s sole point of contact and sole contracting party; (v) all subcontractor and Company Affiliate employees shall be subject to the same provisions of this Agreement as Company’s employees; and (vi) Company shall be solely responsible for paying all subcontractors, unless otherwise expressly set forth in an SOW. Any employee, contractor, subcontractor or agent performing Services (collectively, “Employees”) shall be immediately removed from a project if requested by Client in its discretion. Company shall be liable and responsible for its subcontractors’ and Affiliates’ and their Employees’ performance of this Agreement as if such performance were made directly by Company. An “Affiliate” of a party is a business entity under common control with, or controlling or controlled by, such party, with “control” meaning direct or indirect ownership of

50% or more of the voting interest in such other entity, and in the case of a partnership, control of the general partner.

Compensation. In return for the Services performed under this Agreement, Client shall pay Company the fees specified in a SOW or purchase order. Client shall not pay fees for Services not performed, and Company shall refund any prepaid fees for work not performed. If Services are performed outside of Company’s place of domicile, payment may be subject to tax withholding. Client shall have the right to withhold such taxes unless Company provides Client with the properly executed forms documenting that its income is exempt from withholding.

Expenses. Company shall furnish, at Company’s expense, all materials, equipment, services or supplies needed to perform and complete the Services. If expressly required in an SOW, Client will reimburse Company for certain pre-authorized and reasonable and necessary out of pocket expenses (without markup) that Company incurs in performing Services that are consistent with Client’s expense reimbursement guidelines as may be provided to Company from time to time (“Pass-Through Expenses”).

Method of Payment. Company shall deliver to Client, within fifteen (15) days after the end of each calendar month or as otherwise set forth in an SOW, an invoice for fees and authorized Pass-Through Expenses. The invoice shall contain a written progress report or summary sheet detailing the work performed by Company and a reasonable accounting of fees and reimbursable Pass-Through Expenses. Invoices and copies of receipts shall be submitted electronically (pdf, doc, xls or ppt format) to the contact provided by Client. Company shall keep original receipts for a period of five (5) years for audit and reporting purposes. Client shall pay undisputed invoiced amounts within thirty (30) days following receipt of an accurate invoice. Client shall have no obligation to reimburse Company for Pass-Through Expenses that are not invoiced within (90) days of the date that Company incurred such expense.

Independent Contractor. Company agrees that it is an independent contractor when performing the Services and that the relationship between Company and Client does not constitute a partnership, joint venture or agency. Neither Company nor any Employee (i) is an employee, agent or legal representative of Client or (ii) has any authority to represent Client or to enter into any contracts or assume any liabilities on behalf of Client. Company retains all rights and privileges of sole employer of Employees, including, without limitation, the right to control, hire, discipline, compensate and terminate such Employees. Neither Company nor its Employees shall have the right to receive employee benefits available to Client employees. Company shall be solely and unconditionally responsible for providing all employee compensation, contributions, and benefits to its Employees, and for paying any related taxes or assessments.

Intellectual Property Rights.

6.1.

Client Materials. All materials, documents, data, software, information and inventions supplied or made available to Company by or on behalf of Client or its designee, and all modifications thereto and all copies and transformations thereof, shall be and remain the sole and exclusive property of Client. Company shall use such items solely to perform the relevant Services, and shall not use such items for any other purpose or for its own benefit, or disseminate such items to any third parties. Company shall deliver all such items to Client immediately upon demand, or upon expiration or termination of this Agreement.

6.2.

Work Product. Company shall make full and prompt disclosure to Client of all inventions, discoveries, know-how, software, work, reports, results, presentations, writings, ideas, designs and other information in any form that are created, developed, written, conceived or made by

Company or any of its Employees (whether solely or jointly with others) as a result of or in connection with the Services and any patent, trade secret or other intellectual property rights with respect thereto (collectively, “Work Product”). Company agrees that all Work Product that is copyrightable subject matter shall be considered “work made for hire” and that Client is and shall be the sole author of the Work Product and the sole owner of all rights therein in perpetuity. With respect to any Work Product that is not “work made for hire,” Company hereby irrevocably assigns and shall cause each of its Employees to assign, without additional consideration, to Client, in perpetuity, all of Company and its Employees’ respective rights, titles and interests worldwide in and to such Work Product. At Client’s request and expense, Company shall, and shall cause its Employees to, execute all documents and take all actions that Client reasonably deems necessary to perfect Client’s ownership of the Work Product.

6.3.

Warranties. Company represents, warrants and covenants that Company has the right to make the assignments and grant the licenses to Client set forth in this Section 6, and that ownership and use of the Work Product by or on behalf of Client will not constitute an infringement of any third party patent, trademark, copyright, trade secret or other proprietary right. Upon Client’s request, Company shall provide Client with a written certification from an authorized representative of Company confirming that all third party materials, if any, included in any deliverable includes all necessary license and use rights for Client’s and its Affiliates’ perpetual and ongoing use of such third party materials without additional charge.

6.4.

Company Materials. To the extent any deliverable includes Company’s or any third party’s pre-existing concepts, ideas, models, know-how, software, methodologies, technology or techniques (“Company Materials”), Company shall identify all such Company Materials in the applicable SOW and, as between the parties, Company shall retain ownership in such Company Materials and Company hereby grants to Client, its Affiliates and their respective independent contractors, agents, successors and assigns, a worldwide, non-exclusive, perpetual, irrevocable, royalty-free, paid-up, fully-transferable right and license to use the Company Materials and to make, have made, sell, offer to sell, have sold and import products and services using Company Materials.

Confidential Information.

7.1.

Definition. Client and Company acknowledge and agree that each party will have access to, or become acquainted with, information and materials that the other party considers confidential. For purposes of this Agreement, “Confidential Information” means all confidential, and proprietary information, property and material of the disclosing party or its Affiliates, and all derivatives, portions and copies thereof. Client Confidential Information includes without limitation, information resulting from or related to: (i) the Services; (ii) the business practices, plans or relationships of Client; and (iii) Work Product.

7.2.

Restrictions. The receiving party shall keep the disclosing party’s Confidential Information in strict confidence and shall not, at any time during or for ten (10) years after the expiration or termination of this Agreement, without the disclosing party’s prior written consent, disclose, publish, disseminate or otherwise make available, directly or indirectly, any item of such Confidential Information to any third party. The receiving party shall use the disclosing party’s Confidential Information only in connection with the performance or receipt of Services (as applicable), or in the exercise of a right granted under this Agreement, and for no other purpose. Upon the disclosing party’s request or upon completion of the Services, the receiving party shall immediately cease all use of the disclosing party’s Confidential Information and return it to the disclosing party or, at the disclosing party’s option, certify to the destruction of all Confidential Information; provided, however, the receiving party may retain one copy of the disclosing party’s

Confidential Information for archival purposes only.

7.3.

Exceptions. Confidential Information shall not include information that: (i) is already in the public domain at time of disclosure; (ii) becomes part of the public domain through no fault or wrongful act of the receiving party; (iii) is rightfully received by the receiving party from a third party without any obligation of confidentiality or any restriction on use; (iv) is already known to the receiving party without any obligation of confidentiality or any restriction on use, as evidenced by its written records; or (v) is independently developed by the receiving party without use of the other party’s Confidential Information, as evidenced by the receiving party’s written records. Information that a disclosing party makes available to the receiving party shall be presumed to be Confidential Information and the burden of establishing that such information comes within the foregoing exceptions is on the receiving party.

7.4.

Permitted Disclosures. Notwithstanding the obligations set forth above, each party may disclose the other party’s Confidential Information to any of such party’s employees or consultants who need to receive the Confidential Information in order to perform responsibilities and obligations related to the Services, or to exercise a right granted under this Agreement, provided that each party shall ensure that, prior to disclosing the Confidential Information, each employee or consultant to whom the Confidential Information is to be disclosed is made aware of the obligations contained in this Agreement and agrees to adhere to such terms of this Agreement as if it were a party to it. Each party is responsible and liable for such persons’ compliance with the terms of this Section 7.

7.5.

Disclosure. If the receiving party is or expects to be required to disclose the disclosing party’s Confidential Information pursuant to any judicial or administrative process or order, the receiving party shall, as soon as practicable and prior to any such disclosure, give the disclosing party sufficient notice and reasonable assistance to contest such requirement or order should it wish to do so. The receiving party agrees to cooperate fully with the disclosing party in seeking any protective order, at the disclosing party’s request and expense. If the receiving party is required to disclose the disclosing party’s Confidential Information pursuant to such process, the receiving party shall only disclose such Confidential Information that is required by such process and shall continue to treat such information as Confidential Information even after disclosure.

7.6.

Nondisclosure of Terms. Company will not disclose the terms or existence of this Agreement to any third party except for disclosure to its financial or legal advisors under an obligation of confidentiality.

Equitable Relief. The parties recognize that any threatened breach or breach of Section 6 or Section 7 will cause irreparable harm that may be inadequately compensable in damages and that, in addition to other remedies that may be available at law or equity, a party is entitled to seek injunctive relief for such threatened or actual breach, without the obligation of posting a bond or proving monetary damages.

Term and Termination.

9.1.

Term. This Agreement shall continue in full force and effect for a period of five (5) years from the Effective Date (the “Term”). If Services are being performed by Company under a SOW signed by the parties during the Term and such 5-year period has expired, then this Agreement shall continue in effect only with respect to any such SOW until its completion.

9.2.

Termination by Client. Client may terminate this Agreement or any given SOW for any reason

upon seven (7) days’ notice to Company, specifying the date upon which such termination shall be effective. Upon receipt of such notice, Company shall inform Client of the extent of performance through such date and deliver to Client whatever Work Product exists, including works-in-progress. In the event of termination of this Agreement by Client pursuant to this Section, Client shall pay for Services satisfactorily rendered prior to the effective date of cancellation in a manner consistent with the Agreement and the applicable SOW.

9.3.

Termination for Cause. Each party may terminate this Agreement or any given SOW immediately by written notice to the other party if the other party has materially breached an obligation in this Agreement or the SOW, as applicable, and the breach is not curable. If the breach is curable, the breaching party shall have thirty (30) days from receipt of notice specifying the nature and extent of the breach to cure. This Agreement or the SOW, as applicable, will terminate at the end of this 30-day period unless the breach is cured.

9.4.

Additional Termination Right. Client may terminate this Agreement immediately upon notice to Company if Company or one of Company’s Employees is convicted of a crime involving counterfeiting, diversion or illegal trade, or there is evidence of Company’s involvement in fraud, counterfeiting, diversion or illegal trade, or other violation of laws. Client shall have the right, at any time, to cancel or postpone any pre-scheduled audits, meetings, and/or project commencement for an individual SOW by giving reasonable advanced notice to Company without additional costs and/or expenses to Client, where reasonable advanced notice is defined as greater than five (5) business days’ notice from said audits, meetings, or project commencement.

9.5.

Effect of Termination. Termination of a SOW alone shall not result in the termination of this Agreement or termination of any other SOW. Termination of this Agreement shall automatically terminate each SOW. Except as may be set forth otherwise in this Agreement, all rights and obligations of the parties that expressly or by their nature survive the expiration or termination of this Agreement shall continue in full force and effect subsequent to and notwithstanding the expiration or termination of this Agreement until they are satisfied or by their nature expire and shall bind the parties and their legal representatives, successors, and permitted assigns. Without limiting the foregoing, Sections 6, 7, 8, 9.5, 11, 14, 16, 17, 18, 19, 20 and 21 shall survive any expiration or termination of this Agreement

10.

Other Engagement. Company may provide services to other clients during the Term provided, Company is not, and will not become, a party to another agreement that conflicts with Company’s performance under this Agreement.

11.

Indemnification. Company shall defend, indemnify and hold harmless Client, its Affiliates and their respective officers, directors, partners, shareholders, employees and agents, from and against any and all liabilities, claims, demands, causes of action, damages, losses, fines, penalties, costs and expenses, including, without limitation, reasonable attorneys’ fees, arising out of or in connection with: (a) any negligence or intentional misconduct of Company in the performance of the Services; (b) any breach by Company of its obligations under this Agreement; or (c) any allegation that the Services, work product or deliverables provided by Company, or any Company Materials, infringe or misappropriate a third party’s patent, trademark, trade secret, copyright or any other proprietary right.

12.

Insurance. Company shall maintain at its own expense full insurance coverage for Company and its Employees, including, without limitation:

12.1.

Commercial General Liability covering bodily injury and property damage (including loss of use

thereof) with minimum limits of $1,000,000 each occurrence and $2,000,000 general aggregate, including Premises Liability, Products/Completed Operations, and Contractual Liability coverage for the Indemnity provided under this Agreement;

12.2.

Commercial Automobile Liability covering owned, hired and non-owned vehicles with limits of at least $1,000,000 combined single limit (bodily injury and property damage);

12.3.

Workers’ Compensation as required by Applicable Laws and Employer’s Liability coverage with a limit of not less than $1,000,000; and

12.4.

Umbrella Liability coverage with minimum limits of at least $4,000,000 each occurrence and $4,000,000 general aggregate, sitting excess of the general liability, commercial auto liability and employer’s liability program.

Each of the policies referenced with the exception of 12.3 shall name Client as an Additional Insured. All referenced policies shall (i) be primary to any liability insurance carried by Client, which insurance shall be excess and noncontributory for claims and losses arising out of the performance of this Agreement, and (ii) shall cover claims arising out of the performance of this Agreement made within three (3) years of termination or expiration of the Agreement. All coverage required above, with the exception of 12.3, shall include a waiver of subrogation and a waiver of any insured-versus-insured exclusion regarding Client (provided that this waiver of subrogation shall not circumvent Company’s indemnification obligations under the Agreement). Upon request, Company shall provide Client with certificates of insurance coverage.

13.

Representations and Warranties of Company.

13.1.

General. Company represents and warrants that it is free to enter into this Agreement and that performance of the Services does not, and will not, (i) breach any agreement that obligates Company to keep in confidence any trade secrets or confidential information of Company or of any third party, or (ii) breach any agreement with a third party that restricts Company from providing Services to Client.

13.2.

Compliance. Company represents and warrants that payment of fees by Client is not a kickback, inducement or reward for the purchase or use of Client products and that Company is under no pre-existing duty or obligation, including an obligation imposed by law, regulation, payer, or contractual arrangement with a third party, that already requires Company to perform the Services.

13.3.

Qualification. Company represents and warrants that Company and its Employees are, and at all times during the Term will be, qualified by training and experience, with appropriate expertise and necessary licenses, approvals and certifications, to perform safely, adequately and lawfully the obligations under this Agreement. Company represents and warrants that all Company Employees performing Services shall successfully complete any training required by Client prior to commencing any such Services.

13.4.

Applicable Laws. Company represents, warrants and undertakes that it: (i) will perform this Agreement and operate its business in compliance with all Applicable Laws; (ii) shall not offer, pay, request or accept any bribe, inducement, kickback or facilitation payment, and shall not make or cause another to make any offer or payment to any individual or entity for the purpose of influencing a decision for the benefit of Client; and (iii) shall cause its affiliated companies, suppliers and subcontractors performing Services to operate their business in compliance with all

Applicable Laws.

14.

Audits, Inspections and Records.

14.1.

Audits. During the Term, and with reasonable prior notice, Company shall allow Client, or a designated third party, access to Company’s facilities, systems, books and records in order to review the performance of Services and audit and ascertain compliance by Company with the terms of this Agreement.

14.2.

Regulatory Inspections. Company shall promptly inform Client if any governmental or regulatory authority takes, or gives notice of its intent to take, legal or regulatory action alleging improper or inadequate practices in the performance of the Services or potentially impacting performance of the Services. Company shall promptly inform Client of the findings of any such action or inspection by a governmental or regulatory authority that may have an impact on the performance of Services or the manufacture of Client products and any related quality systems.

14.3.

Records. “Records” means information created, received or recorded in any format by Company in the performance of Company’s obligations under this Agreement. Company shall maintain and retain complete, organized and accurate Records. Company shall ensure that Records are protected from destruction or damage and are maintained within Company’s control during the Term and for three (3) years thereafter, or for a longer period of time as requested by Client and agreed to by Company, or as otherwise specified in this Agreement or required under Applicable Law. If Applicable Law does not permit certain Records to be maintained for this length of time, Company shall maintain such Records for the maximum period of time permitted by Applicable Law. Client, or its authorized representatives, shall be permitted to examine and obtain copies of such Records at Client’s expense during the Term and for three (3) years thereafter.

15.

Debarment. Company represents and warrants to Client that Company: (i) is not excluded, debarred, suspended or otherwise ineligible to participate in government healthcare programs or in government procurement or non-procurement programs and no debarment is pending or has been initiated; (ii) has not been charged with or convicted of a criminal offense that requires exclusion from a government healthcare program; and (iii) is not otherwise disqualified or suspended from performing the Services or subject to any restrictions or sanctions by any governmental or regulatory authority or professional body (an “Ineligible Person”). Company further represents and warrants that Company is not using, and will not in the future use, any Employee who is an Ineligible Person in the performance of Services. Company shall immediately notify Client in writing if Company or any Employee is or becomes an Ineligible Person or if any action, suit, claim, investigation, or other legal or administrative proceeding is pending or, to the best of Company’s knowledge, threatened, that would make Company or any Employee an Ineligible Person.

16.

Communications and Use of Name. All drafts of proposed publications, written reports, training materials, advertisements and similar documents related to the Services and intended to be communicated or published by Company to any third party (“Communications”) must be submitted to Client for review and approval prior to dissemination. Client shall have the right to make any editorial changes it deems necessary to ensure such Communications are accurate and in compliance with Applicable Laws and Client policies or to protect any information that Client considers confidential. Company shall not use Client’s name or Confidential Information in any publication, press release, promotional material or other form of publicity without the prior written approval of Client, which it may withhold, condition and/or revoke in its discretion.

17.

Data Protection and Security Requirements. In performing Services, Company shall comply with

Client’s data protection, privacy and security policies as provided to Company in writing in advance from time to time, and shall execute Client’s standard form of Business Associate Agreement if necessary.

18.

Governing Law and Venue. This Agreement shall be governed by and construed and interpreted in accordance with the laws of the State of Connecticut, excluding with respect to conflict of laws principles. The Parties submit to the personal and exclusive jurisdiction of the courts in Connecticut for any disputes arising under or relating to this Agreement. The United Nations Convention on the International Sale of Goods is excluded.

19.

Notices. Any notice or legal communication that is required or permitted hereunder shall be deemed given only if delivered personally or sent by facsimile (with transmission confirmed) or by registered or certified mail, return receipt requested, or by a nationally recognized overnight delivery service, sent to the address of each Party as provided in writing to the other Party after the Effective Date. Notices shall be effective upon receipt. It is understood that this Section is not intended to govern the day-to-day business communications between the parties in performing Services.

20.

Limitation of Liability. EXCEPT FOR DAMAGES CAUSED BY A PARTY’S BREACH OF SECTION 7 OR COMPANY’S BREACH OF SECTION 17, AND EXCEPT FOR PERSONAL INJURY (INCLUDING DEATH) AND PROPERTY DAMAGE CAUSED BY A PARTY’S NEGLIGENCE, NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR INCIDENTAL, CONSEQUENTIAL OR EXEMPLARY DAMAGES ARISING OUT OF THIS AGREEMENT EVEN IF SUCH DAMAGES WERE FORESEEABLE.

21.

Miscellaneous. This Agreement and each SOW constitute the entire agreement and understanding between the parties with respect to the subject matter hereof and supersede all prior oral and written agreements, understandings, promises and representations with respect thereto. Notwithstanding the content of any purchase order, sales agreement or other document or record, whether issued before or after the Effective Date, the provisions of this Agreement shall govern and any conflicting, inconsistent or additional terms contained in other documents or records shall be void. In the event of any conflict or inconsistency between an SOW and this Agreement, the terms of this Agreement shall govern unless otherwise expressly set forth in such SOW, in which case the term of the SOW shall govern for purposes of such SOW only. No amendment, modification or waiver of any of the terms of this Agreement shall be deemed valid unless made in writing and duly executed by authorized representatives of both parties. Each party may enforce the Agreement in strict accordance with its terms. The failure of either party to enforce its rights strictly in accordance with terms shall not be construed as having in any way modified or waived same. Company may not assign, delegate or transfer this Agreement or any of its rights or obligations hereunder. Invalidity or unenforceability of any provision in this Agreement shall not affect the validity or enforceability of any other provision. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original and all of which shall together be deemed to constitute one agreement.

IN WITNESS WHEREOF, the parties intending to be legally bound, do hereby execute this Agreement effective as of the Effective Date and represent that the individuals executing this Agreement have the authority to bind their respective entities.


HYPERFINE, INC.

By:	/s/ Neela A. Paykel
Name:	Neela A. Paykel
Title:	General Counsel

     4CATALYZER CORPORATION

    

     By: /s/ Alexander Magary

    

     Name: Alexander Magary

    

     Title: Assistant Secretary

    

ATTACHMENT A

Statement of Work

Hyperfine, Inc. (“Client”) and 4Catalyzer Corporation (“Company”) have entered into a Master Services Agreement dated ________, 2021 (the “Agreement”). Client and Company enter into this Statement of Work (“SOW”) effective _________, 2021 (the “SOW Effective Date”). The terms and conditions of the Agreement are incorporated herein by reference and shall govern the performance of the parties’ duties under this SOW. Capitalized terms used herein and not otherwise defined are used as defined in the Agreement. This SOW shall not bind the parties unless and until a purchase order is issued against the SOW.

Background and Project Description. [This section should contain both a description of the objective, goals and outcomes of the project and an explanation of why Client needs these Services, including the benefits and value that the project will deliver.]

Services/Deliverables. [Describe in detail the Services/deliverables that Company will perform or provide, along with any methodology, dependencies, assumptions and acceptance testing (if applicable).]

Key Performance Indicators. [KPIs should be measureable items which tie to project milestones. The consequences of a failure to meet a KPI also need to be explained.]

Project Milestones and Billing Schedule. The Services and deliverables will be performed or provided in accordance with the following milestones and at the rates set forth below. Invoices shall be issued upon acceptance of the Services and deliverables by Client.


Milestone/Deliverable	Date Due	Rate	Payment

Key Personnel. Company agrees to use its best efforts to maintain continuity in personnel assigned to perform the Services. Key personnel are named below.


Name	Title	Rate	Responsibilities

Term. This SOW shall take effect as of the SOW Effective Date and shall be completed when all of the Services are performed to Client’s satisfaction [or “terminate on _____________”], unless terminated earlier or extended pursuant to the Agreement.

IN WITNESS WHEREOF, the authorized representatives of the parties hereto have executed this SOW on the date stated opposite that party’s signature.

Hyperfine, Inc. 4Catalyzer Corporation

- ii –


By:			By:
Name:			Name:
Title:			Title:
Date:			Date:

- iii –

Exhibit 31.1

CERTIFICATIONS UNDER SECTION 302

I, Maria Sainz, certify that:

I have reviewed this quarterly report on Form 10-Q of Hyperfine, Inc.;

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 14, 2024


/s/ Maria Sainz
Maria Sainz
President and Chief Executive Officer (principal executive officer)

Exhibit 31.2

CERTIFICATIONS UNDER SECTION 302

I, Brett Hale, certify that:

I have reviewed this quarterly report on Form 10-Q of Hyperfine, Inc.;

any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 14, 2024


/s/ Brett Hale
Brett Hale
Chief Administrative Officer, Chief Financial Officer, Treasurer and Corporate Secretary (principal financial officer)

Exhibit 32

CERTIFICATIONS UNDER SECTION 906

Pursuant to section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of section 1350, chapter 63 of title 18, United States Code), each of the undersigned officers of Hyperfine, Inc., a Delaware corporation (the “Company”), does hereby certify, to such officer’s knowledge, that:

The Quarterly Report for the quarter ended March 31, 2024 (the “Form 10-Q”) of the Company fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.


Dated: May 14, 2024	/s/ Maria Sainz
	Maria Sainz
	President and Chief Executive Officer
	(principal executive officer)

Dated: May 14, 2024	/s/ Brett Hale
	Brett Hale
	Chief Administrative Officer, Chief Financial Officer, Treasurer and Corporate Secretary
	(principal financial officer)

Document and Entity Information - shares	3 Months Ended
Document and Entity Information - shares	Mar. 31, 2024	May 01, 2024
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2024
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q1
Trading Symbol	HYPR
Entity Registrant Name	Hyperfine, Inc.
Entity Central Index Key	0001833769
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Title of 12(b) Security	Class A common stock, $0.0001 Par Value Per Share
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Shell Company	false
Entity File Number	001-39949
Entity Tax Identification Number	98-1569027
Entity Address, Address Line One	351 New Whitfield Street
Entity Address, City or Town	Guilford
Entity Address, State or Province	CT
Entity Address, Postal Zip Code	06437
City Area Code	866
Local Phone Number	796-6767
Entity Incorporation, State or Country Code	DE
Document Quarterly Report	true
Document Transition Report	false
Class A Common Stock
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		56,952,666
Class B Common Stock
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		15,055,288

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
CURRENT ASSETS:
Cash and cash equivalents	$ 63,204	$ 75,183
Restricted cash		621
Accounts receivable, less allowance of $248 and $321 as of March 31, 2024 and December 31, 2023, respectively	5,343	3,189
Unbilled receivables	895	942
Inventory	7,298	6,582
Prepaid expenses and other current assets	2,950	2,391
Total current assets	79,690	88,908
Property and equipment, net	3,706	2,999
Other long term assets	2,047	2,292
Total assets	85,443	94,199
CURRENT LIABILITIES:
Accounts payable	2,532	1,214
Deferred grant funding		621
Deferred revenue	1,527	1,453
Accrued expenses and other current liabilities	4,663	5,419
Total current liabilities	8,767	8,768
Long term deferred revenue	1,021	968
Other noncurrent liabilities	17	64
Total liabilities	9,805	9,800
COMMITMENTS AND CONTINGENCIES (NOTE 13)
STOCKHOLDERS' EQUITY:
Additional paid-in capital	339,201	338,114
Accumulated deficit	(263,570)	(253,722)
Total stockholders' equity	75,638	84,399	$ 123,722
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	85,443	94,199
Class A Common Stock
STOCKHOLDERS' EQUITY:
Common stock	5	5
Class B Common Stock
STOCKHOLDERS' EQUITY:
Common stock	2	2
Related Party
CURRENT LIABILITIES:
Due to related parties	$ 45	$ 61

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Allowance for doubtful accounts receivable	$ 248	$ 321
Class A Common Stock
Common shares, par value, (per share)	$ 0.0001	$ 0.0001
Common shares, shares authorized	600,000,000	600,000,000
Common shares, shares issued	56,952,666	56,840,949
Common shares, shares outstanding	56,952,666	56,840,949
Class B Common Stock
Common shares, par value, (per share)	$ 0.0001	$ 0.0001
Common shares, shares authorized	27,000,000	27,000,000
Common shares, shares issued	15,055,288	15,055,288
Common shares, shares outstanding	15,055,288	15,055,288

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Sales
Total sales	$ 3,295	$ 2,635
Cost of sales
Total cost of sales	1,941	1,480
Gross margin	1,354	1,155
Operating Expenses:
Research and development	5,570	5,461
General and administrative	4,430	6,182
Sales and marketing	2,004	2,547
Total operating expenses	12,004	14,190
Loss from operations	(10,650)	(13,035)
Interest income	796	869
Other income, net	6	6
Loss before provision for income taxes	(9,848)	(12,160)
Provision for income taxes	0	0
Net loss and comprehensive loss	$ (9,848)	$ (12,160)
Earnings Per Share, Basic	$ (0.14)	$ (0.17)
Earnings Per Share, Diluted	$ (0.14)	$ (0.17)
Denominator for Basic EPS - Weighted-average common stock	71,934,045	70,864,226
Denominator for Dilutive EPS - Weighted-average common stock	71,934,045	70,864,226
Device
Sales
Total sales	$ 2,704	$ 2,132
Cost of sales
Total cost of sales	1,499	1,071
Service
Sales
Total sales	591	503
Cost of sales
Total cost of sales	$ 442	$ 409

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Unaudited) - USD ($) $ in Thousands	Total	Additional Paid-in Capital	Accumulated Deficit	Common Stock Class A Common Stock	Common Stock Class B Common Stock
Balance at Dec. 31, 2022	$ 123,722	$ 333,199	$ (209,484)	$ 5	$ 2
Balance (in shares) at Dec. 31, 2022				55,622,488	15,055,288
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(12,160)		(12,160)
Issuance of restricted stock				324,296
Exercise of stock options	49	49
Exercise of stock options (in shares)				54,211
Stock-based compensation expense	1,126	1,126
Balance at Mar. 31, 2023	112,737	334,374	(221,644)	$ 5	$ 2
Balance (in shares) at Mar. 31, 2023				56,000,995	15,055,288
Balance at Dec. 31, 2023	84,399	338,114	(253,722)	$ 5	$ 2
Balance (in shares) at Dec. 31, 2023				56,840,989	15,055,288
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(9,848)		(9,848)
Issuance of restricted stock				41,007
Exercise of stock options	55	55
Exercise of stock options (in shares)				70,670
Stock-based compensation expense	1,032	1,032
Balance at Mar. 31, 2024	$ 75,638	$ 339,201	$ (263,570)	$ 5	$ 2
Balance (in shares) at Mar. 31, 2024				56,952,666	15,055,288

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Cash flows from operating activities:
Net loss	$ (9,848)	$ (12,160)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation	263	254
Stock-based compensation expense	1,032	1,126
Payments received on net investment in lease	34	2
Changes in assets and liabilities:
Accounts receivable, net	(2,154)	(915)
Unbilled receivables	47	(259)
Inventory	(833)	(1,122)
Prepaid expenses and other current assets	(1,252)	272
Due from related parties		48
Prepaid inventory	693	281
Other long term assets	200	(18)
Accounts payable	1,208	954
Deferred grant funding	(621)	(58)
Deferred revenue	127	(125)
Due to related parties	(16)	64
Accrued expenses and other current liabilities	(1,392)	(1,835)
Operating lease liabilities, net	2
Net cash used in operating activities	(12,510)	(13,491)
Cash flows from investing activities:
Purchases of property and equipment	(145)	(61)
Net cash used in investing activities	(145)	(61)
Cash flows from financing activities:
Proceeds from exercise of stock options	55	49
Net cash provided by financing activities	55	49
Net decrease in cash and cash equivalents and restricted cash	(12,600)	(13,503)
Cash, cash equivalents and restricted cash, beginning of period	75,804	118,243
Cash, cash equivalents and restricted cash, end of period	63,204	104,740
Reconciliation of cash, cash equivalents, and restricted cash reported in the balance sheets
Cash and cash equivalents	63,204	104,027
Restricted cash		713
Total cash, cash equivalents and restricted cash	63,204	104,740
Supplemental disclosure of noncash information:
Unpaid purchase of property and equipment	$ 742	$ 36

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Mar. 31, 2024	Mar. 31, 2023
Pay vs Performance Disclosure
Net Income (Loss)	$ (9,848)	$ (12,160)

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Mar. 31, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false
Rule 10b5-1 Arrangement Modified	false
Non-Rule 10b5-1 Arrangement Modified	false

ORGANIZATION AND DESCRIPTION OF BUSINESS

3 Months Ended

Mar. 31, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

ORGANIZATION AND DESCRIPTION OF BUSINESS

1. ORGANIZATION AND DESCRIPTION OF BUSINESS

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

3 Months Ended

Mar. 31, 2024

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Principles of Consolidation

Risks and Uncertainties

Concentrations of Credit Risk

Segment Information

Use of Estimates

•

Allowance for credit losses;

•

Net realizable value (the selling price as well as estimated costs of disposal and transportation) of inventory, and demand and future use of inventory;

•

Valuation allowances with respect to deferred tax assets; and

•

Assumptions underlying the fair value used in the calculation of stock-based compensation expense.

Recently Issued Accounting Pronouncements

REVENUE RECOGNITION

3 Months Ended

Mar. 31, 2024

Revenue from Contract with Customer [Abstract]

REVENUE RECOGNITION

3. REVENUE RECOGNITION

Disaggregation of Revenue


		Three Months Ended March 31,
	Pattern of Recognition	2024		2023
Device	Point in time	$	2,704	$	2,132
Service	Over time		591		503
Total revenue		$	3,295	$	2,635

Contract Balances

The following table provides information about receivables and deferred revenue from contracts with customers:



	March 31, 2024		December 31, 2023
Accounts receivable, net	$	5,343	$	3,189
Unbilled receivables - current	$	895	$	942
Unbilled receivables - non-current(1)	$	909	$	1,044
Deferred revenue	$	1,527	$	1,453
Long term deferred revenue	$	1,021	$	968

______________________

(1) Recorded in other long term assets in the Company’s consolidated balance sheets.

Accounts Receivable, Unbilled Services, and Deferred Revenue

Timing of Billing and Performance

Revenue from Leasing Arrangements

Costs of Obtaining or Fulfilling Contracts

Transaction price allocated to remaining performance obligations

FAIR VALUE OF FINANCIAL INSTRUMENTS

3 Months Ended

Mar. 31, 2024

Fair Value Disclosures [Abstract]

FAIR VALUE OF FINANCIAL INSTRUMENTS

4. FAIR VALUE OF FINANCIAL INSTRUMENTS

Level 1 — Valuations based on quoted prices in active markets for identical assets or liabilities that an entity has the ability to access.

The Company had no assets or liabilities classified as Level 2 or Level 3 and there were no transfers between fair value measurement levels during the three months ended March 31, 2024 and 2023.

INVENTORIES

3 Months Ended

Mar. 31, 2024

Inventory Disclosure [Abstract]

Inventories

5. INVENTORIES

A summary of inventories is as follows:


	March 31, 2024		December 31, 2023
Raw materials	$	2,617	$	1,757
Finished goods		4,681		4,825
Total inventories	$	7,298	$	6,582

PROPERTY AND EQUIPMENT, NET

3 Months Ended

Mar. 31, 2024

Property, Plant and Equipment [Abstract]

PROPERTY AND EQUIPMENT, NET

6. PROPERTY AND EQUIPMENT, NET

Property and equipment, net, are recorded at historical cost and consist of the following:


	March 31, 2024			December 31, 2023
Laboratory equipment	$	986		$	986
Research devices		1,679			1,532
Sales and marketing devices		490			490
Computer equipment		678			668
Construction in progress		1,335			595
Tooling		509			505
Trade show assets		254			254
Leased devices		397			397
Other		612			611
		6,940			6,038
Less: Accumulated depreciation and amortization		(3,234	)		(3,039	)
Property and equipment, net	$	3,706		$	2,999

Depreciation expense amounted to $263 and $254 for the three months ended March 31, 2024 and 2023, respectively.

RIGHT-OF-USE ("ROU") ASSETS AND LEASES LIABILITIES

3 Months Ended

Mar. 31, 2024

Leases [Abstract]

RIGHT-OF-USE ("ROU") ASSETS AND LEASES LIABILITIES

7. RIGHT-OF-USE (“ROU”) ASSETS AND LEASES LIABILITIES

The weighted-average remaining lease term associated with the measurement of the Company's operating lease obligations is 13 months and the weighted-average discount rate is 7.9%.

The Company recorded short-term operating lease cost during the three months ended March 31, 2024 of $45. Cash paid for operating lease during the three months ended March 31, 2024 was $48.

Future minimum commitments due under the lease agreement as of March 31, 2024 are $165 for the remainder of 2024 and $50 thereafter.

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

3 Months Ended

Mar. 31, 2024

Payables and Accruals [Abstract]

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

8. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Accrued expenses and other current liabilities consist of the following:



	March 31, 2024		December 31, 2023
Bonuses	$	1,012	$	2,463
Contracted services		1,894		1,237
Legal fees		339		412
Payroll and related benefits		1,072		676
Operating lease liabilities		189		185
Other		157		446
Total accrued expenses and other current liabilities	$	4,663	$	5,419

EQUITY INCENTIVE PLAN

3 Months Ended

Mar. 31, 2024

Share-Based Payment Arrangement [Abstract]

EQUITY INCENTIVE PLAN

9. EQUITY INCENTIVE PLAN

Stock option activity

The following table summarizes the changes in the Company’s outstanding stock options for the three months ended March 31, 2024:


	Number of Options
Outstanding at January 1, 2024		14,271,587
Granted (1)		4,461,083
Exercised		(70,670	)
Forfeited / Cancelled / Expired		(181,006	)
Outstanding at March 31, 2024		18,480,994

_____________________________________________

(1)

Restricted stock unit activity

The following table summarizes the changes in the Company’s outstanding RSUs for the three months ended March 31, 2024:


	Number of RSUs
Outstanding at January 1, 2024		369,026
Granted		—
Vested		(41,036	)
Forfeited		(13,747	)
Outstanding at March 31, 2024		314,243

The following table presents details of stock-based compensation expenses by functional line item noted within the Company's operating expenses:


	Three Months Ended March 31,
	2024		2023
Cost of sales	$	24	$	23
Research and development		337		206
Sales and marketing		39		38
General and administrative		632		859
	$	1,032	$	1,126

NET LOSS PER SHARE

3 Months Ended

Mar. 31, 2024

Earnings Per Share [Abstract]

NET LOSS PER SHARE

10. NET LOSS PER SHARE

The following table presents the calculation of basic and diluted net loss per share for the Company’s common stock:


	Three Months Ended March 31,
	2024			2023
Numerator:
Net Loss	$	(9,848	)	$	(12,160	)
Numerator for Basic and Dilutive EPS – Loss available to common stockholders	$	(9,848	)	$	(12,160	)
Denominator:
Common Stock		71,934,045			70,864,226
Denominator for Basic and Dilutive EPS - Weighted-average common stock		71,934,045			70,864,226
Basic and dilutive net loss per share	$	(0.14	)	$	(0.17	)


	Three Months Ended March 31,
	2024		2023
Outstanding options to purchase common stock		18,480,994		13,297,988
Outstanding RSUs		314,243		1,151,596
Earn-Out Shares (1)		9,357,835		9,400,616
Total anti-dilutive common equivalent shares		28,153,072		23,850,200

_________________________

INCOME TAXES

3 Months Ended

Mar. 31, 2024

Income Tax Disclosure [Abstract]

INCOME TAXES

11. INCOME TAXES

RELATED PARTY TRANSACTIONS

3 Months Ended

Mar. 31, 2024

RELATED PARTY TRANSACTIONS

12. RELATED PARTY TRANSACTIONS

COMMITMENTS AND CONTINGENCIES

3 Months Ended

Mar. 31, 2024

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

13. COMMITMENTS AND CONTINGENCIES

Commitments

Purchase Commitments

Contingencies

SUBSEQUENT EVENTS

3 Months Ended

Mar. 31, 2024

Subsequent Events [Abstract]

SUBSEQUENT EVENTS

14. SUBSEQUENT EVENTS

The Company has evaluated subsequent events through the date the financial statements were issued and has determined that there were no subsequent events required to be disclosed.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	3 Months Ended
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	Mar. 31, 2024
Accounting Policies [Abstract]
Basis of Presentation and Principles of Consolidation	Basis of Presentation and Principles of Consolidation The unaudited accompanying condensed consolidated financial statements include the accounts of the Company and have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the accounting disclosure rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. All intercompany transactions and balances have been eliminated. These condensed consolidated financial statements should be read in conjunction with the financial statements and notes included in the Company’s audited consolidated financial statements as of and for the years ended December 31, 2023 and 2022. The condensed consolidated balance sheet as of December 31, 2023 included herein was derived from the audited consolidated financial statements as of that date. The accompanying condensed consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the financial position, results of operations, and cash flows for the interim periods. The results for the three months ended March 31, 2024 are not necessarily indicative of the results to be expected for any subsequent quarter, the year ending December 31, 2024, or any other period. Except as described elsewhere in this Note 2 under the heading “Recently Issued Accounting Pronouncements”, there have been no material changes to the Company’s significant accounting policies as described in the audited consolidated financial statements as of December 31, 2023 and 2022.
Risks and Uncertainties	Risks and Uncertainties The Company is subject to risks and uncertainties caused by events with significant geopolitical and macroeconomic impacts, including, but not limited to, the conflicts in Ukraine and the Middle East, inflation and actions taken to counter such impacts. The Company relies on single source manufacturers and suppliers for the supply of its products. Disruption from these manufacturers or suppliers has and would have a negative impact on the Company’s business, financial position and results of operations in its consolidated financial statements. The Company continues to critically review its liquidity and anticipated capital requirements in light of the significant uncertainty created by geopolitical and macroeconomic conditions.
Concentration of Credit Risk	Concentrations of Credit Risk The Company's cash and cash equivalents are deposited with several major financial institutions. At times, deposits in these institutions exceed the amount of insurance provided on such deposits. The Company reduces this risk by maintaining such deposits with high quality financial institutions that management believes are creditworthy and the Company monitors this credit risk and makes adjustments to the concentrations as necessary. The Company has not experienced any losses in such accounts and does not believe that it is exposed to any significant risk of loss on these balances. With respect to accounts receivable, credit risk is mitigated by the Company’s ongoing credit evaluation of its customers’ financial condition. As of March 31, 2024 and December 31, 2023, the Company had three customers and two customers, respectively, that each accounted for more than 10% of trade receivables. With respect to revenues, three customers and one customer each accounted for more than 10% of revenues for the three months ended March 31, 2024 and 2023, respectively.
Segment Information	Segment Information The Company’s Chief Operating Decision Maker (“CODM”) is its Chief Executive Officer (“CEO”). Substantially all of the Company’s long-lived assets are located in the United States. Other than $2,434 of revenue recognized in non-U.S. countries for the three months ended March 31, 2024, all of the revenues during this period were earned in the United States. Since the Company is aggregated into a single reportable segment, all required financial segment information is provided in the condensed consolidated financial statements.
Use of Estimates	Use of Estimates The preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires the Company to make estimates and assumptions about future events that affect the amounts reported in its condensed consolidated financial statements and accompanying notes. Future events and their effects cannot be determined with certainty. On an ongoing basis, management evaluates these estimates and assumptions. Significant estimates and assumptions included: • Revenue recognition, including determination of the timing and pattern of satisfaction of performance obligations, determination of the standalone selling price (“SSP”) of performance obligations; • Allowance for credit losses; • Net realizable value (the selling price as well as estimated costs of disposal and transportation) of inventory, and demand and future use of inventory; • Valuation allowances with respect to deferred tax assets; and • Assumptions underlying the fair value used in the calculation of stock-based compensation expense. The Company bases these estimates on historical and anticipated results and trends and on various other assumptions that the Company believes are reasonable under the circumstances, including assumptions as to future events. Changes in estimates are recorded in the period in which they become known. Actual results could differ from those estimates, and any such differences may be material to the Company’s condensed consolidated financial statements.
Recently Issued Accounting Pronouncements	Recently Issued Accounting Pronouncements In December 2023, the Financial Accounting Standards Board (“FASB”) issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which enhances effective tax rate reconciliation disclosure requirements and provides clarity to the disclosures of income taxes paid, income before taxes and provision for income taxes. The amendments are effective for fiscal years beginning after December 15, 2024. Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance. The amendments in this update should be applied on a prospective basis. Retrospective application is permitted. The Company is currently evaluating this ASU to determine the impact of the amendments on the Company’s consolidated financial statements and disclosures. In November 2023, the FASB issued ASU No. 2023-07 “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures.” This ASU expands public entities’ segment disclosures by requiring disclosure of significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items, and interim disclosures of a reportable segment’s profit or loss and assets. This ASU is effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024. This ASU is applicable to the Company’s Annual Report on Form 10-K for the fiscal year ending December 31, 2024, and subsequent interim periods, with early application permitted. The Company is currently evaluating the impact of adopting this ASU on its consolidated financial statements and disclosures. Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the SEC have not had, or are not believed by management to have, a material impact on the Company’s present or future financial statements.

REVENUE RECOGNITION (Tables)

3 Months Ended

Mar. 31, 2024

Revenue from Contract with Customer [Abstract]

Summary of Disaggregated Revenues

The following table summarizes the Company’s disaggregated revenues:


		Three Months Ended March 31,
	Pattern of Recognition	2024		2023
Device	Point in time	$	2,704	$	2,132
Service	Over time		591		503
Total revenue		$	3,295	$	2,635

Information about Receivables and Deferred Revenue from Contracts with Customers

The following table provides information about receivables and deferred revenue from contracts with customers:



	March 31, 2024		December 31, 2023
Accounts receivable, net	$	5,343	$	3,189
Unbilled receivables - current	$	895	$	942
Unbilled receivables - non-current(1)	$	909	$	1,044
Deferred revenue	$	1,527	$	1,453
Long term deferred revenue	$	1,021	$	968

______________________

(1) Recorded in other long term assets in the Company’s consolidated balance sheets.

INVENTORIES (Tables)

3 Months Ended

Mar. 31, 2024

Inventory Disclosure [Abstract]

Summary of Inventories

A summary of inventories is as follows:


	March 31, 2024		December 31, 2023
Raw materials	$	2,617	$	1,757
Finished goods		4,681		4,825
Total inventories	$	7,298	$	6,582

PROPERTY AND EQUIPMENT, NET (Tables)

3 Months Ended

Mar. 31, 2024

Property, Plant and Equipment [Abstract]

Schedule of Property and Equipment, Net

Property and equipment, net, are recorded at historical cost and consist of the following:


	March 31, 2024			December 31, 2023
Laboratory equipment	$	986		$	986
Research devices		1,679			1,532
Sales and marketing devices		490			490
Computer equipment		678			668
Construction in progress		1,335			595
Tooling		509			505
Trade show assets		254			254
Leased devices		397			397
Other		612			611
		6,940			6,038
Less: Accumulated depreciation and amortization		(3,234	)		(3,039	)
Property and equipment, net	$	3,706		$	2,999

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Tables)

3 Months Ended

Mar. 31, 2024

Payables and Accruals [Abstract]

Schedule Of Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consist of the following:



	March 31, 2024		December 31, 2023
Bonuses	$	1,012	$	2,463
Contracted services		1,894		1,237
Legal fees		339		412
Payroll and related benefits		1,072		676
Operating lease liabilities		189		185
Other		157		446
Total accrued expenses and other current liabilities	$	4,663	$	5,419

EQUITY INCENTIVE PLAN (Tables)

3 Months Ended

Mar. 31, 2024

Share-Based Payment Arrangement [Abstract]

Summary of Stock Option Activity

The following table summarizes the changes in the Company’s outstanding stock options for the three months ended March 31, 2024:


	Number of Options
Outstanding at January 1, 2024		14,271,587
Granted (1)		4,461,083
Exercised		(70,670	)
Forfeited / Cancelled / Expired		(181,006	)
Outstanding at March 31, 2024		18,480,994

_____________________________________________

(1)

Summary of Restricted Stock Unit Activity

The following table summarizes the changes in the Company’s outstanding RSUs for the three months ended March 31, 2024:


	Number of RSUs
Outstanding at January 1, 2024		369,026
Granted		—
Vested		(41,036	)
Forfeited		(13,747	)
Outstanding at March 31, 2024		314,243

Summary of Stock-Based Compensation Expenses by Function

The following table presents details of stock-based compensation expenses by functional line item noted within the Company's operating expenses:


	Three Months Ended March 31,
	2024		2023
Cost of sales	$	24	$	23
Research and development		337		206
Sales and marketing		39		38
General and administrative		632		859
	$	1,032	$	1,126

NET LOSS PER SHARE (Tables)

3 Months Ended

Mar. 31, 2024

Earnings Per Share [Abstract]

Schedule of Basic and Diluted Net Loss Per Share

The following table presents the calculation of basic and diluted net loss per share for the Company’s common stock:


	Three Months Ended March 31,
	2024			2023
Numerator:
Net Loss	$	(9,848	)	$	(12,160	)
Numerator for Basic and Dilutive EPS – Loss available to common stockholders	$	(9,848	)	$	(12,160	)
Denominator:
Common Stock		71,934,045			70,864,226
Denominator for Basic and Dilutive EPS - Weighted-average common stock		71,934,045			70,864,226
Basic and dilutive net loss per share	$	(0.14	)	$	(0.17	)

Schedule of Anti-dilutive Common Equivalent Shares

Anti-dilutive common equivalent shares were as follows:


	Three Months Ended March 31,
	2024		2023
Outstanding options to purchase common stock		18,480,994		13,297,988
Outstanding RSUs		314,243		1,151,596
Earn-Out Shares (1)		9,357,835		9,400,616
Total anti-dilutive common equivalent shares		28,153,072		23,850,200

_________________________

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Additional Information (Details) $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2024 USD ($) Customer	Mar. 31, 2023 USD ($) Customer	Dec. 31, 2023 Customer
Summary Of Significant Accounting Policies [Line Items]
Revenue recognized \| $	$ 493	$ 430
Revenue \| Customer Concentration Risk
Summary Of Significant Accounting Policies [Line Items]
Number Of Customers \| Customer	3	1
Accounts Receivable \| Customer Concentration Risk
Summary Of Significant Accounting Policies [Line Items]
Number Of Customers \| Customer	3		2
Non-US
Summary Of Significant Accounting Policies [Line Items]
Revenue recognized \| $	$ 2,434

REVENUE RECOGNITION - Summary of Disaggregated Revenues (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Disaggregation Of Revenue [Line Items]
Total revenue	$ 3,295	$ 2,635
Device
Disaggregation Of Revenue [Line Items]
Total revenue	2,704	2,132
Device \| Point In Time
Disaggregation Of Revenue [Line Items]
Total revenue	2,704	2,132
Service
Disaggregation Of Revenue [Line Items]
Total revenue	591	503
Service \| Over Time
Disaggregation Of Revenue [Line Items]
Total revenue	$ 591	$ 503

REVENUE RECOGNITION - Information about Receivables and Deferred Revenue from Contracts with Customers (Details) - USD ($)
$ in Thousands

Mar. 31, 2024

Dec. 31, 2023

Revenue from Contract with Customer [Abstract]

Accounts receivable, net

$ 5,343

$ 3,189

Unbilled receivables - current

895

942

Unbilled receivables - non-current

^[1]

909

1,044

Deferred revenue

1,527

1,453

Long term deferred revenue

$ 1,021

$ 968

[1]	Recorded in other long term assets in the Company’s consolidated balance sheets.

REVENUE RECOGNITION - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Disaggregation Of Revenue [Line Items]
Payment terms range, minimum	30 days
Payment terms range, maximum	1 year
Revenue recognized that was included in the deferred revenue balance at the beginning of the period	$ 493	$ 430
Capitalized contract cost	378		$ 391
Amortization of capitalized contract cost	78	16
Remaining performance obligation	5,618		$ 5,661
Service
Disaggregation Of Revenue [Line Items]
Revenue from lease arrangements	$ 82	$ 114

REVENUE RECOGNITION - Additional Information (Details1)	Mar. 31, 2024
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2024-04-01
Disaggregation Of Revenue [Line Items]
Remaining performance obligation expected to be recognized, percentage	30.00%
Remaining performance obligation expected to be recognized, duration	9 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2025-01-01
Disaggregation Of Revenue [Line Items]
Remaining performance obligation expected to be recognized, percentage	70.00%
Remaining performance obligation expected to be recognized, duration

FAIR VALUE OF FINANCIAL INSTRUMENTS - Additional Information (Details) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Fair value assets transfer between levels amount	$ 0	$ 0
Level 1 \| Money Market Funds and Demand Deposit Accounts
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Cash and cash equivalents	63,005,000		$ 74,685,000
Level 2
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Assets	0	0
Liabilities	0	0
Level 3
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Assets	0	0
Liabilities	$ 0	$ 0

INVENTORIES - Summary of Inventories (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Inventory Disclosure [Abstract]
Raw materials	$ 2,617	$ 1,757
Finished goods	4,681	4,825
Total inventories	$ 7,298	$ 6,582

PROPERTY AND EQUIPMENT, NET - Schedule of Property and equipment, net (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Property Plant And Equipment [Line Items]
Property and equipment, gross	$ 6,940	$ 6,038
Less: Accumulated depreciation and amortization	(3,234)	(3,039)
Property and equipment, net	3,706	2,999
Laboratory Equipment
Property Plant And Equipment [Line Items]
Property and equipment, gross	986	986
Research Devices
Property Plant And Equipment [Line Items]
Property and equipment, gross	1,679	1,532
Sales and Marketing Devices
Property Plant And Equipment [Line Items]
Property and equipment, gross	490	490
Computer Equipment
Property Plant And Equipment [Line Items]
Property and equipment, gross	678	668
Construction In Progress
Property Plant And Equipment [Line Items]
Property and equipment, gross	1,335	595
Tooling
Property Plant And Equipment [Line Items]
Property and equipment, gross	509	505
Trade Show Assets
Property Plant And Equipment [Line Items]
Property and equipment, gross	254	254
Leased Devices
Property Plant And Equipment [Line Items]
Property and equipment, gross	397	397
Other
Property Plant And Equipment [Line Items]
Property and equipment, gross	$ 612	$ 611

PROPERTY AND EQUIPMENT, NET - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Property, Plant and Equipment [Abstract]
Depreciation expense	$ 263	$ 254

RIGHT-OF-USE ("ROU") ASSETS AND LEASES LIABILITIES - Additional Information (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2024 USD ($)	Mar. 01, 2024 ft²
Lessee, Lease, Description [Line Items]
Lease expiration date	Apr. 30, 2025
Operating lease ROU assets	$ 194
Operating lease, right-of-use asset, statement of financial position	Other long term assets
Operating lease liability, current	$ 189
Operating lease, liability, current, statement of financial position	Accrued expenses and other current liabilities
Operating lease liability, noncurrent	$ 17
Operating lease, liability, noncurrent, statement of financial position	Other noncurrent liabilities
Weighted-average remaining lease term - operating leases (in months)	13 months
Weighted-average discount rate - operating leases	7.90%
Short-term operating lease cost	$ 45
Cash paid for operating lease	48
Future minimum commitments due under the lease agreement remainder of 2024	165
Future minimum commitments due under the lease agreement thereafter	50
Guilford, Connecticut
Lessee, Lease, Description [Line Items]
Lease term		12 months
Lessee, operating lease, renewal term		1 year
Operating lease, number of square feet of warehouse space \| ft²		10,000
Future minimum commitments due under the lease agreement remainder of 2024	52
Future minimum commitments due under the lease agreement thereafter	$ 12

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES - Schedule of Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Payables and Accruals [Abstract]
Bonuses	$ 1,012	$ 2,463
Contracted services	1,894	1,237
Legal fees	339	412
Payroll and related benefits	1,072	676
Operating lease liabilities	189	185
Other	157	446
Total accrued expenses and other current liabilities	$ 4,663	$ 5,419

EQUITY INCENTIVE PLAN - Summary of Stock Option Activity (Details) - Hyperfine Plan

3 Months Ended

Mar. 31, 2024

Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding [Roll Forward]

Number of Options, Beginning balance

14,271,587

Number of Options, Granted

4,461,083

^[1]

Number of Options, Exercised

(70,670)

Number of Options, Forfeited / Cancelled / Expired

(181,006)

Number of Options, Ending balance

18,480,994

[1]

EQUITY INCENTIVE PLAN - Summary of Stock Option Activity (Parenthetical) (Details)	3 Months Ended
	Mar. 31, 2024 shares
Vesting Tranche One
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Vesting Rights, Percentage	25.00%
Employee New Hire \| Class A Common Stock
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of shares to be purchased upon exercise of non-qualified stock options	91,100
Annual Employee Grants [Member] \| Class A Common Stock
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of shares to be purchased upon exercise of non-qualified stock options	1,934,983
Executive \| Class A Common Stock
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of shares to be purchased upon exercise of non-qualified stock options	2,435,000

EQUITY INCENTIVE PLAN - Additional Information (Details)	3 Months Ended
	Mar. 31, 2024
Employee Stock Option
Stock-based Compensation Arrangement by Stock-based Payment Award [Line Items]
Stock based compensation award requisite service period	4 years

EQUITY INCENTIVE PLAN - Summary of Restricted Stock Unit Activity (Details) - Restricted Stock Unit	3 Months Ended
	Mar. 31, 2024 shares
Stock-based Compensation Arrangement by Stock-based Payment Award [Line Items]
Number of RSUs, Beginning balance	369,026
Number of RSUs, Vested	(41,036)
Number of RSUs, Forfeited	(13,747)
Number of RSUs, Ending balance	314,243

EQUITY INCENTIVE PLAN - Summary of Stock-Based Compensation Expenses by Function (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Employee Service Stock-based Compensation Allocation Of Recognized Period Costs [Line Items]
Total stock-based compensation expense	$ 1,032	$ 1,126
Cost of Sales
Employee Service Stock-based Compensation Allocation Of Recognized Period Costs [Line Items]
Total stock-based compensation expense	24	23
Research and Development
Employee Service Stock-based Compensation Allocation Of Recognized Period Costs [Line Items]
Total stock-based compensation expense	337	206
Sales and Marketing
Employee Service Stock-based Compensation Allocation Of Recognized Period Costs [Line Items]
Total stock-based compensation expense	39	38
General and Administrative
Employee Service Stock-based Compensation Allocation Of Recognized Period Costs [Line Items]
Total stock-based compensation expense	$ 632	$ 859

NET LOSS PER SHARE - Schedule of Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Net loss	$ (9,848)	$ (12,160)
Numerator for Basic and Dilutive EPS – Loss available to common stockholders	$ (9,848)	$ (12,160)
Denominator for Basic EPS - Weighted-average common stock	71,934,045	70,864,226
Denominator for Dilutive EPS - Weighted-average common stock	71,934,045	70,864,226
Earnings Per Share, Basic	$ (0.14)	$ (0.17)
Earnings Per Share, Diluted	$ (0.14)	$ (0.17)
Common Stock
Denominator for Basic EPS - Weighted-average common stock	71,934,045	70,864,226
Denominator for Dilutive EPS - Weighted-average common stock	71,934,045	70,864,226

NET LOSS PER SHARE - Schedule of Anti-dilutive Common Equivalent Shares (Details) - shares	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Total anti-dilutive common equivalent shares	28,153,072	23,850,200
Outstanding Options to Purchase Common Stock
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Total anti-dilutive common equivalent shares	18,480,994	13,297,988
Outstanding RSUs
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Total anti-dilutive common equivalent shares	314,243	1,151,596
Earn-Out Shares
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Total anti-dilutive common equivalent shares	9,357,835	9,400,616

NET LOSS PER SHARE - Schedule of Anti-dilutive Common Equivalent Shares (Parenthetical) (Details) - Class A Common Stock - $ / shares	3 Months Ended
	Mar. 31, 2024	Dec. 31, 2023
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Common stock, shares issued	56,952,666	56,840,949
Number of trading days	20 days
Number of consecutive trading days	30 days
Earnout shares right to terminate threshold consideration value	$ 15
Minimum
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Share price	15
Value of cash or other consideration received upon conversion of stock	$ 15
Earn-Out Shares \| Maximum
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Common stock, shares issued	10,000,000

INCOME TAXES - Additional Information (Details)	3 Months Ended
INCOME TAXES - Additional Information (Details)	Mar. 31, 2024	Mar. 31, 2023
Income Tax Disclosure [Abstract]
Effective tax rate percent	0.00%	0.00%
Statutory tax rate	21.00%

RELATED PARTY TRANSACTIONS - Additional Information (Details) - 4C - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Related Party Transaction [Line Items]
Payments for rent	$ 129	$ 58
Payment for services	34	$ 137
Due to related parties	$ 45		$ 61

COMMITMENTS AND CONTINGENCIES (Details)	1 Months Ended	3 Months Ended		12 Months Ended
COMMITMENTS AND CONTINGENCIES (Details)	May 31, 2023 USD ($)	Mar. 31, 2024 USD ($)	Mar. 31, 2023 USD ($)	Dec. 31, 2021 USD ($) System	Dec. 31, 2023 USD ($)	Dec. 31, 2020 USD ($)
Product Liability Contingency [Line Items]
Matching contributions to the plan		$ 0	$ 0
Deferred grant funding				$ 4,910,000	$ 621,000	$ 4,910,000
Grant awarded from the BMGF	$ 3,354,000
Expenses allocated		1,000,000
Number of swoop systems and other services deployed \| System				25
Earn-out liability		0
Amount released from restricted cash		621,000
Grant receivable		470,000
Interest earned		9,000
Grant fund amounts required to be returned under provisions		0			$ 0
Indemnification Agreement
Product Liability Contingency [Line Items]
Liability under indemnifications		$ 0