Radiology vendor Nanox Imaging warns of ‘going concern’ risk as losses deepen

Radiology vendor Nanox Imaging is raising concern about its continued viability amid persistent financial challenges. 

The publicly traded, Israel-based company reported its quarterly earnings result on June 25, including a net loss of $14.3 million, up 8% from the same period the previous year. Nanox—which has developed a commercial grade, tomographic imaging device with a digital X-ray source—said it is burning through cash and may need a lifeline. 

During the first three months in 2026, the company experienced negative cash flow from operations of $14 million. In fact, since incorporating in 2012, Nanox has accumulated a deficit of $463 million, with its activities primarily funded by the sale of common stock. 

“The company expects to continue to incur significant costs related to its ongoing operations,” Nanox said in an announcement Thursday, noting that management expects its cash balance to be insufficient to support operations for the next year. “These factors raise substantial doubt as to the company’s ability to continue as a going concern,” it added later. 

Nanox estimated it has a cash balance of approximately $27 million as of this month. Management is currently seeking to raise funds in the private equity and capital markets to help finance operations. However, there is no assurance it will be able to secure the necessary financing. Nanox also warned that the sale of securities or additional indebtedness raises the risk of diluting its stockholders’ interests. Shares of the company were down sharply following the earnings report, falling 35% over the last five days. 

The challenge comes after investors recently filed a class-action lawsuit, claiming Nanox has made false and misleading statements about its business. These include efforts to scale up its manufacturing and production operations to meet anticipated demand for its Nanox.Arc system following regulatory approvals. The company also shared an update about challenges with its South Korean manufacturing operations on Thursday. Nanox said it is now evaluating ways to optimize its cost structure there and “maximize the value” of related assets. As part of these deliberations, the company said it’s considering selling or closing its operations in Korea. 

Nanox continues to be hampered by factors including manufacturing site readiness, construction and infrastructure completion, and regulatory processes. “As a result of these timing-related factors,” the company said it no longer expects to achieve 2026 revenue targets. It believes that providing investors with annual revenue guidance is “not currently an appropriate tool for evaluating the company’s operating progress,” with Nanox now suspending such forecasting.

CEO Erez Meltzer said the company will alter its business approach to emphasize partnerships while taking steps to “improve our cost structure.” Nanox also is prioritizing deployments of its Nanox.ARC imaging system at “high visibility reference sites.” These include a facility operated by RadNet Inc., which has reportedly used a single such system for several months. 

“While changing the standard of care in medical imaging takes time, we believe these adjustments position us more effectively for sustainable growth and to capitalize on the potential of Nanox.ARC,” Meltzer said in a statement June 25. “That said, the pace of commercialization will continue to depend on a range of factors, including market adoption, customer demand, site readiness, construction timelines, regulatory approvals, and the performance of our partners.”

Along with manufacturing systems, Nanox also owns teleradiology firm USARad and AI-maker Zebra Medical, acquiring both in 2021 for over $200 million. Nanox was previously subject to two securities class action complaints against the company and its former officer. On June 2, 2023, Nanox entered into a formal agreement to settle those actions for $8 million. Additionally, the company paid a $650,000 civil penalty to settle charges that it violated SEC rules that same year.