Profound Medical Corp.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 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 June 30, 2026

☐	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: 001-39032

PROFOUND MEDICAL CORP.

(Exact Name of Registrant as Specified in its Charter)


Ontario, Canada	Not Applicable
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

2400 Skymark Avenue, Unit #6, Mississauga, Ontario, Canada (Address of principal executive offices)	L4W 5K5 (Zip Code)

Registrant’s telephone number, including area code: (647) 476-1350

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


Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Shares, No Par Value Per Share		PROF		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, 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 August 6, 2026, the registrant had 36,532,594 common shares, no par value per share, outstanding.

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Profound Medical Corp.

CONDENSED CONSOLIDATED BALANCE SHEETS

(USD in thousands, except per share data)

(unaudited)


	June 30,	December 31,
	2026	2025
	$	$
Assets

Current assets:
Cash	38,271	59,723
Trade and other receivables, net (note 3)	9,614	7,200
Inventory (note 4)	10,456	8,238
Prepaid expenses and deposits	523	928
Total current assets	58,864	76,089

Trade and other receivables, net (note 3)	—	300
Property and equipment, net (note 5)	556	698
Intangible assets, net (note 6)	121	138
Right-of-use assets, net (note 9)	2,763	184
Deferred tax assets, net	81	66
Total assets	62,385	77,475

Liabilities

Current liabilities:
Accounts payable	955	1,563
Accrued expenses and other current liabilities (note 7)	3,127	3,815
Deferred revenue	342	445
Long-term debt (note 8)	4,507	—
Lease liabilities (note 9)	119	213
Income tax payable	63	39
Total current liabilities	9,113	6,075

Deferred revenue	618	388
Long-term debt (note 8)	—	4,499
Lease liabilities (note 9)	2,754	—
Other non-current liabilities	92	79
Total liabilities	12,577	11,041

Shareholders’ equity

Common shares, no par value, unlimited shares authorized, 36,532,594 and 36,293,640 issued and outstanding at June 30, 2026 and December 31, 2025, respectively (note 10)	325,383	323,839
Additional paid-in capital	25,688	25,310
Accumulated other comprehensive income	3,070	5,025
Accumulated deficit	(304,333)	(287,740)
Total shareholders’ equity	49,808	66,434

Total liabilities and shareholders’ equity	62,385	77,475

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

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Profound Medical Corp.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(USD in thousands, except per share data)

(unaudited)


	Three Months Ended June 30,			Six Months Ended June 30,
	2026	2025		2026	2025
	$	$		$	$
Revenue (note 12)
Recurring - non-capital	1,612	1,561		4,086	3,362
Capital equipment	871	650		3,734	1,470
	2,483	2,211		7,820	4,832
Cost of sales	536	593		2,041	1,361
Gross profit	1,947	1,618		5,779	3,471

Operating expenses
Research and development	5,654	6,098		10,916	10,906
Selling, general and administrative	7,359	9,326		13,950	17,537
Total operating expenses	13,013	15,424		24,866	28,443

Operating loss	11,066	13,806		19,087	24,972

Other (income) expenses
Net finance income	(336)	(343)		(713)	(788)
Net foreign exchange (gain) loss	(1,245)	2,168		(1,861)	2,130
Total other (income) expenses	(1,581)	1,825		(2,574)	1,342

Net loss before income taxes	9,485	15,631		16,513	26,314

Income tax expense	68	78		95	119
Deferred tax recovery	(13)	(14)		(15)	(14)
Total income tax expense	55	64		80	105

Net loss attributed to shareholders for the period	9,540	15,695		16,593	26,419

Other comprehensive (income) loss
Item that may be reclassified to (income) loss
Foreign currency translation adjustment	950	(2,713)		1,955	(2,816)

Net loss and other comprehensive loss for the period	10,490	12,982		18,548	23,603

Loss per share (note 13)
Basic and diluted net loss per common share	0.26	0.52		0.46	0.88
Basic and diluted weighted average common shares outstanding	36,350,665	30,053,142		36,324,393	30,055,047

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

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Profound Medical Corp.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(USD in thousands)

(unaudited)


				Accumulated
			Additional	Other
			Paid-in	Comprehensive	Accumulated
	Common Shares		Capital	Income	Deficit	Tota1
	Shares	Amount $	$	$	$	$
Balance - December 31, 2025	36,293,640	323,839	25,310	5,025	(287,740)	66,434
Net loss for the period	—	—	—	—	(7,053)	(7,053)
Cumulative translation adjustment – net of tax of $nil	—	—	—	(1,005)	—	(1,005)
Vesting of DSUs (note 11)	10,000	68	(68)	—	—	—
Vesting of RSUs (note 11)	33,997	256	(256)	—	—	—
Share-based compensation (note 11)	—	—	1,048	—	—	1,048
Balance – March 31, 2026	36,337,637	324,163	26,034	4,020	(294,793)	59,424

Net loss for the period	—	—	—	—	(9,540)	(9,540)
Cumulative translation adjustment – net of tax of $nil	—	—	—	(950)	—	(950)
Vesting of DSUs (note 11)	16,128	96	(96)	—	—	—
Vesting of RSUs (note 11)	178,829	1,124	(1,124)	—	—	—
Share-based compensation (note 11)	—	—	874	—	—	874
Balance – June 30, 2026	36,532,594	325,383	25,688	3,070	(304,333)	49,808

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

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Profound Medical Corp.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(USD in thousands)

(unaudited)


				Accumulated
			Additional	Other
			Paid-in	Comprehensive	Accumulated
	Common Shares		Capital	Income	Deficit	Total
	Shares	Amount $	$	$	$	$
Balance - December 31, 2024	30,039,809	281,552	21,298	2,742	(245,170)	60,422
Net loss for the period	—	—	—	—	(10,724)	(10,724)
Cumulative translation adjustment – net of tax of $nil	—	—	—	103	—	103
Vesting of RSUs (note 11)	13,333	89	(89)	—	—	—
Share-based compensation (note 11)	—	—	989	—	—	989
Balance – March 31, 2025	30,053,142	281,641	22,198	2,845	(255,894)	50,790

Net loss for the period	—	—	—	—	(15,695)	(15,695)
Cumulative translation adjustment – net of tax of $nil	—	—	—	2,713	—	2,713
Share-based compensation (note 11)	—	—	1,451	—	—	1,451
Balance – June 30, 2025	30,053,142	281,641	23,649	5,558	(271,589)	39,259

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

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Profound Medical Corp.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(USD in thousands)

(unaudited)


		Six Months Ended June 30,
		2026		2025
		$		$
Cash flows from operating activities
Net loss for the period		(16,593)		(26,419)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation of property and equipment (note 5)		219		218
Amortization of intangible assets (note 6)		16		86
Non-cash lease expense adjustment		99		(19)
Share-based compensation (note 11)		1,922		2,440
Interest and accretion expense		9		51
Changes in operating assets and liabilities:
Trade and other receivables (note 3)		(2,473)		2,449
Inventory (note 4)		(2,686)		(2,723)
Prepaid expenses and deposits		384		1,042
Accounts payable, accrued expenses and other liabilities (note 7)		(991)		545
Deferred revenue		164		317
Income taxes payable		27		—
Deferred tax assets		(18)		(14)
Net cash used in operating activities		(19,921)		(22,027)

Cash flows from financing activities
Repayments of long-term debt (note 8)		—		(290)
Net cash provided by (used in) financing activities		—		(290)

Net increase (decrease) in cash		(19,921)		(22,317)
Effect of exchange rate changes on cash		(1,531)		2,600
Cash, beginning of period		59,723		54,912
Cash, end of period		38,271		35,195

Supplemental cash flow information:
Interest paid		150		139
Income taxes paid, included in operating activities		69		65

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

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Profound Medical Corp.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

1Description of business

Profound Medical Corp. (Profound) (the Company) was incorporated under the Ontario Business Corporations Act on July 16, 2014. The Company is a commercial-stage medical device company focused on the development and marketing of customizable, incision-free therapeutic systems for the ablation of diseased tissue utilizing platform technologies.

The Company’s registered address is 2400 Skymark Avenue, Unit 6, Mississauga, Ontario, Canada, L4W 5K5.

2	Summary of significant accounting policies

Basis of preparation

The Company prepares its condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States (US GAAP). The condensed consolidated financial statements include the accounts of wholly owned subsidiaries, after elimination of intercompany accounts and transactions. The consolidated financial information presented herein reflects all financial information that, in the opinion of management, is necessary for a fair statement of financial position, results of operations and cash flows for the periods presented.

Unaudited condensed consolidated financial statements

The condensed consolidated balance sheet as of June 30, 2026, the condensed consolidated statements of operations and comprehensive loss for the three and six months ended June 30, 2026 and 2025, the condensed consolidated statements of shareholders’ equity for the three and six months ended June 30, 2026 and 2025, and the condensed consolidated statements of cash flows for the six months ended June 30, 2026 and 2025, are unaudited. The financial data and other information disclosed in these notes to the consolidated financial statements related to June 30, 2026, and the three and six months ended June 30, 2026 and 2025, are also unaudited. The accompanying condensed consolidated balance sheet as of December 31, 2025, has been derived from the audited consolidated financial statements included in the Annual Report on Form 10-K (“Annual Report”) filed with the Securities and Exchange Commission on March 5, 2026.

The unaudited condensed consolidated financial statements have been prepared on the same basis as the annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to a fair statement of the Company’s financial position as of June 30, 2026, and the results of its operations and cash flows for the three and six months ended June 30, 2026 and 2025. The results for the three and six months ended June 30, 2026, are not necessarily indicative of results to be expected for the year ending December 31, 2026, or for any other period or for any future year and should be read in conjunction with the annual consolidated financial statements included in the Annual Report.

Use of estimates

The preparation of the Company’s condensed consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Significant estimates and assumptions reflected in these consolidated financial statements include, but are not limited to, assumptions related to the determination of expected credit losses, and the valuation of stock options. The Company based its estimates on historical experience, known trends and other market-specific or other relevant factors that it believes to be reasonable under the circumstances. On an ongoing basis, management evaluates its estimates when there are changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. Actual results could differ from those estimates.

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Recent Accounting Pronouncements

In January 2026, the Company adopted ASU 2025-05, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets. The Company elected the practical expedient to assume that current conditions as of the balance-sheet date remain unchanged for the remaining life of its current accounts receivable and contract assets. The adoption of this guidance did not have a material impact on the Company’s condensed consolidated financial statements.

3	Trade and other receivables, net

Trade receivables and other receivables, net, as of June 30, 2026 and December 31, 2025 consists of the following:


	June 30,	December 31,
	2026	2025
	$	$
Trade receivables, gross	9,584	7,621
Contract assets, gross	—	386
Trade receivables and contract assets	9,584	8,007
Allowance for expected credit losses	(577)	(898)
Trade receivables, net	9,007	7,109
Tax receivables	427	311
Other receivables	180	80
Total trade and other receivables, net	9,614	7,500
Less: Current portion	9,614	7,200
Long-term portion	—	300

The activity in the allowance for expected credit losses for trade receivables and contract assets was as follows:


	June 30,	December 31,
	2026	2025
	$	$
Balance - Beginning of the period	898	158
Write off against the allowance	(375)	—
Provision for allowance for expected credit losses	54	740
Balance - End of the period	577	898

4	Inventory

Inventory as of June 30, 2026 and December 31, 2025 consists of the following:


	June 30,	December 31,
	2026	2025
	$	$
Finished goods	5,899	5,280
Raw materials	4,557	2,958
Inventory	10,456	8,238

During the three and six months ended June 30, 2026, $428 and $1,861, respectively (three and six months ended June 30, 2025 - $496 and $1,156, respectively) of inventory was recognized in cost of sales.

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5	Property and equipment, net

The major components of property and equipment, net, as of June 30, 2026 and December 31, 2025 consist of the following:


	June 30,		December 31,
	2026		2025
	$		$
Leasehold improvements	542		542
Equipment	176		176
Equipment under operating lease	1,494		1,571
Total	2,212		2,289
Accumulated depreciation	(1,656)		(1,591)
Property and equipment, net	556		698

Depreciation expense for the three and six months ended June 30, 2026 was $126 and $219, respectively (three and six months ended June 30, 2025 - $102 and $218, respectively). During the three and six months ended June 30, 2026, the Company sold $71 and $154, respectively (three and six months ended June 30, 2025 - $135 and $213, respectively) of equipment under operating lease to a customer.

6	Intangible assets

The major components of intangible assets as of June 30, 2026 and December 31, 2025 consist of:


				June 30, 2026						December 31, 2025
				$						$
		Weighted
		Average
		Remaining				Accumulated						Accumulated
		Useful		Gross		Amortization		Net		Gross		Amortization		Net
		Lives		Carrying		and		Carrying		Carrying		and		Carrying
		(Years)		Amount		Impairments		Amount		Amount		Impairments		Amount
Exclusive license agreement		3.1		231		(171)		60		231		(158)		73
Software		—		978		(978)		—		978		(978)		—
Distribution rights		14.3		66		(5)		61		66		(1)		65
				1,275		(1,154)		121		1,275		(1,137)		138

The Company has a license agreement (the license) with Sunnybrook Health Sciences Centre (Sunnybrook), pursuant to which Sunnybrook licenses to the Company certain intellectual property and exclusively licensed-in rights that enable the Company to use Sunnybrook’s technology for MRI-guided trans-urethral ultrasound therapy. The Company has the option to acquire rights to improvements to the relevant technology and intellectual property. If the Company fails to comply with any of its obligations or otherwise breaches this agreement, Sunnybrook may have the right to terminate the license.

7	Accrued expenses and other current liabilities

Accrued expenses and other current liabilities, as of June 30, 2026 and December 31, 2025 consist of the following:


	June 30,		December 31,
	2026		2025
	$		$
Accrued employee compensation	1,437		2,347
Clinical trials	694		524
Other general accruals	996		944
Accrued expenses and other current liabilities	3,127		3,815

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8	Long-term debt

On March 3, 2025, the Company entered into an amended and restated credit agreement (the “CIBC Credit Agreement”), with Canadian Imperial Bank of Commerce (“CIBC”) which amended the terms of the CIBC Loan and the existing long-term debt provided under the Original CIBC Credit Agreement was repaid with proceeds from a new revolving line of credit provided by CIBC to Profound. This was accounted for as a modification of debt whereby a new effective interest rate was established based on the carrying value of the debt and the revised cash flows. The line of credit bears interest at the Wall Street Journal Prime Rate subject to a floor of 6.25%. Following an amendment to the CIBC Credit Agreement on September 30, 2025, the amended financial covenants are that unrestricted cash is at all times greater of: (i) to the extent that EBITDA is a negative number or loss for the most recent six-month period, the amount of such loss, or (ii) $10,000, reported on a monthly basis and that revenue for the 12 month period must be 15% greater than revenue for the same period in the prior fiscal year, reported on a quarterly basis. The Company is in compliance with these financial covenants as of June 30, 2026. Future compliance with the financial covenants included in the CIBC Credit Agreement is dependent upon achieving certain revenue, EBITDA, and anticipated unrestricted cash levels.

The obligations are secured by, inter alia, a general security agreement over the assets and the assets of the Company’s subsidiaries. The revolving line of credit matures on March 3, 2027 and provides an option to the Company to increase the amount of the revolving commitment by $5,000 within 18 months from March 3, 2025, subject to achieving a minimum trailing 12 month revenue exceeding $15,000. The exercise of the option would result in the size of the revolving commitment increasing from $10,000 to a maximum of $15,000. Additionally, the CIBC Credit Agreement provides that Profound may request a one-time increase in the principal amount of the revolving line of credit up to a maximum amount of $10,000, which is subject to the approval of CIBC in its sole discretion.


		June 30,		December 31,
		2026		2025
		$		$
Balance - Beginning of period		4,499		4,661
Interest expense		159		394
Interest paid		(150)		(331)
Foreign exchange		(1)		65
Repayment		—		(290)
Balance - End of period		4,507		4,499
Less: Current portion		4,507		—
Long-term portion		—		4,499

9	Leases

Leases where the Company is the Lessee

The Company leases certain office premises. In January 2026, the Company entered into a lease modification agreement for one of its office premises that extended the lease term and modified the payment schedule. This modification increased the right-of-use assets but did not provide the Company with any additional right‑of‑use assets. Therefore, this was accounted for as a modification of an existing operating lease, resulting in a remeasurement of the related operating lease liability using an updated incremental borrowing rate and a corresponding adjustment to the right‑of‑use asset. The extension commences October 1, 2026, with fixed payment structures expiring in 2033. Lease liabilities and corresponding right-of-use assets were recognized based on the present value of future lease payments.

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Lease expense for the three and six months ended June 30, 2026 and 2025:


	Three Months Ended June 30,
	2026	2025
	$	$
Operating lease costs	118	58
Total lease costs	118	58


	Six Months Ended June 30,
	2026	2025
	$	$
Operating lease costs	237	116
Total lease costs	237	116

Other information related to operating leases is as follows:


	Six Months Ended June 30,
	2026		2025
Cash paid from operating cash flows for amounts included in the measurement of lease liabilities	143		140
Weighted average remaining lease term	7.25 years		0.75 years
Weighted average discount rate	5.50	%	5.99	%

Maturities of the operating lease liabilities and minimum payments for operating leases having initial or remaining noncancellable terms in excess of one year as of June 30, 2026 were as follows:


2026		69
2027		377
2028		497
2029		512
2030		528
Thereafter		1,533
Total		3,516
Less: Imputed interest		643
Present value of remaining lease payments		2,873
Less: Current portion		119
Non-current portion		2,754

10	Share capital

Common shares

The Company is authorized to issue an unlimited number of common shares.


		June 30,		December 31,
		2026		2025
Issued and outstanding (with no par value)		$		$
36,532,594 (December 31, 2025 – 36,293,640) common shares		325,383		323,839

Voting Power

Except as otherwise required by law, the holders of common shares possess all voting power for the election of the Company’s directors and all other matters requiring shareholder action. Holders of common shares are entitled to one vote per share on matters to be voted on by shareholders.

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Dividends

Holders of common shares will be entitled to receive such dividends, if any, as may be declared from time to time by the Company’s board of directors in its discretion out of funds legally available therefor. In no event will any stock dividends or stock splits or combinations of stock be declared or made on common stock unless the shares of common stock at the time outstanding are treated equally and identically.

Liquidation, Dissolution and Winding Up

In the event of the Company’s voluntary or involuntary liquidation, dissolution, distribution of assets or winding-up, the holders of the common stock will be entitled to receive an equal amount per share of all of the Company’s assets of whatever kind available for distribution to shareholders, after the rights of the creditors have been satisfied.

11	Share-based payments

Share options

Effective May 20, 2020, the Company adopted amendments to the share option plan (the Share Option Plan). The aggregate maximum number of common shares that may be issued under the Share Option Plan, together with all other security-based compensation arrangements of the Company, is limited to 13% of the issued and outstanding common shares. The current maximum number of common shares reserved for issuance under the share option plan together with the long-term incentive plan is 4,749,237 common shares (or such other number as may be approved by the holders of the voting shares of the Company).

As of June 30, 2026, 2,151,048 (December 31, 2025 – 2,142,522) options were outstanding. Each share option granted allows the holder to purchase one common share, at an exercise price not less than the lesser of the closing trading price of the common shares on the TSX (or other exchange where the common shares are listed), on the date a share option is granted and the volume-weighted average price of the common shares for the five trading days immediately preceding the date the share option is granted. Share options granted under the Share Option Plan generally have a maximum term of ten years and vest over a period of up to four years.

A summary of the share option activity during the period presented and the total number of share options outstanding as of those dates are set forth below:


			Weighted average
	Number		exercise price
	of options		C$
Balance - December 31, 2025	2,142,522		13.53
Granted	121,600		8.29
Forfeited/expired	(113,074)		15.69
Balance - June 30, 2026	2,151,048		13.12
Exercisable - June 30, 2026	1,450,606		14.49
Expected to vest - June 30, 2026	2,151,048		13.12

The Company estimated the fair value of the share options granted during the period using the Black-Scholes option pricing model with the weighted average assumptions below. The Company estimated the expected future stock price volatility for its common stock by using its historical volatility based on daily price observations for the most recent historical period equal to the length of the instrument’s expected life of options.


		March 17,		May 19,		June 11,
Grant date		2026		2026		2026
Exercise price		C$7.58		C$9.63		C$9.41
Expected volatility		68	%	67	%	67	%
Expected life of options		6 years		6 years		6 years
Risk-free interest rate		3.00	%	3.45	%	3.32	%
Dividend yield		—		—		—

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The weighted average grant date fair values of share options granted for the three and six months ended June 30, 2026 were C$5.78 and C$5.40, respectively (three and six months ended June 30, 2025 - C$4.59 and C$4.82).

Long-term incentive plan

Effective May 17, 2023, the Company adopted the amended long term incentive plan (the LTIP). The LTIP is an incentive-based equity compensation plan that provides for the grant of restricted share units (the RSUs) and deferred share units (the DSUs, together with the RSUs, the Units). The aggregate maximum number of common shares that may be reserved for issuance under the LTIP in respect of grants of RSUs and DSUs is limited to 4.9% of the issued and outstanding common shares on a non-diluted basis, provided that, the maximum number of common shares which may be reserved for issuance pursuant to all of the Company’s security-based compensation arrangements shall not in the aggregate exceed 13% of the issued and outstanding common shares on a non-diluted basis. The Company may grant RSUs to officers, directors, employees, or consultants of the Company or any of its affiliates and any such person’s personal holding company, as designated by the Board in a resolution upon the terms and conditions set forth in a grant agreement. DSUs may be granted to any director of the Company who has been designated by the Company for participation in the LTIP and who has agreed to participate in the LTIP Each Unit represents the right to receive one common share in accordance with the terms of the LTIP. The number of Units granted at any particular time will be calculated by dividing the dollar amount of such grant by the market value of a common share on the applicable grant date, which is equal to the volume weighted average trading price of all common shares traded on the TSX (or other exchange where the common shares are listed) for the five trading days immediately preceding such date. RSUs and DSUs granted under the LTIP vest over a period of up to three years, subject to DSU deferral features.

The following table summarizes RSUs activities:


				Weighted
				average grant
				date fair value
		Number of		per share
		RSUs		C$
Balance - December 31, 2025		859,335		9.23
Granted		97,430		8.29
Vested		(212,826)		9.18
Forfeited		(82,003)		9.19
Balance - June 30, 2026		661,936		9.11

A summary of the DSUs changes during the period are set forth below:


				Weighted
				average grant
				date fair value
		Number of		per share
		DSUs		C$
Balance - December 31, 2025		135,490		9.39
Granted		51,324		9.36
Vested		(26,128)		8.84
Forfeited		(17,098)		9.37
Balance - June 30, 2026		143,588		9.48

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Share-based compensation expense

The following table presents the components and classification of share-based compensation recognized for share options, RSUs, and DSUs for the three and six months ended June 30, 2026 and 2025:


		Three Months Ended June 30,				Six Months Ended June 30,
		2026		2025		2026		2025
		$		$		$		$
Share options		295		125		647		758
RSUs		521		627		1,204		869
DSUs		58		699		71		813
Share-based compensation		874		1,451		1,922		2,440

Cost of sales		(26)		7		(19)		10
Research and development		219		315		422		588
Selling, general and administrative		681		1,129		1,519		1,842
Share-based compensation		874		1,451		1,922		2,440

12	Revenue

The following table provides information about disaggregated revenue by products and services:


		Three Months Ended June 30,
		2026		2025
		$		$
Timing of transfer of control
Point in time revenue		2,298		2,028
Service revenue recognized over time		185		183
		2,483		2,211


	Six Months Ended June 30,
	2026	2025
	$	$
Timing of transfer of control
Point in time revenue	7,440	4,475
Service revenue recognized over time	380	357
	7,820	4,832

13	Loss per share

The following table shows the calculation of basic and diluted loss per share:


	Three Months Ended June 30,				Six Months Ended June 30,
	2026		2025		2026		2025
	$		$		$		$
Net loss for the period		9,540		15,695		16,593		26,419
Weighted average number of common shares		36,350,665		30,053,142		36,324,393		30,055,047
Basic and diluted loss per share	$	0.26	$	0.52	$	0.46	$	0.88

The computation of diluted loss per share is equal to the basic loss per share due to the anti-dilutive effect of the share options, RSUs and DSUs. Of the 2,151,048 (June 30, 2025 – 2,147,568) share options, 661,936 (June 30, 2025 – 1,075,454) RSUs, and 143,588 (June 30, 2025 – 152,155) DSUs that are not included in the calculation of diluted loss per share for the period ended June 30, 2026, 1,450,606 (June 30, 2025 – 1,187,803) were exercisable.

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14	Segment reporting

The Company’s operations are categorized into one industry segment, which is medical technology focused on magnetic resonance guided ablation procedures for the treatments to ablate the prostate gland, uterine fibroids, osteoid osteoma and nerves for palliative pain relief for patients with metastatic bone disease. The CODM regularly reviews the operating results of the Company on a consolidated basis as part of making decisions for allocating resources and evaluating performance. Further, the CODM is regularly provided with the consolidated expenses as noted on the consolidated statements of operations and comprehensive loss.

The following tables represent total revenue by geographic area, based on the location of the reporting entity for the three months ended June 30, 2026 and 2025, respectively:


	For the three months ended June 30, 2026
	Canada	USA	Germany	Total
	$	$	$	$
Revenue
Recurring - non-capital	129	1,301	182	1,612
Capital equipment	427	444	—	871
	556	1,745	182	2,483


	For the three months ended June 30, 2025
	Canada	USA	Germany	Total
	$	$	$	$
Revenue
Recurring - non-capital	94	1,327	140	1,561
Capital equipment	—	650	—	650
	94	1,977	140	2,211


	For the six months ended June 30, 2026
	Canada	USA	Germany	Total
	$	$	$	$
Revenue
Recurring - non-capital	1,614	2,140	332	4,086
Capital equipment	2,513	1,221	—	3,734
	4,127	3,361	332	7,820


	For the six months ended June 30, 2025
	Canada	USA	Germany	Total
	$	$	$	$
Revenue
Recurring - non-capital	376	2,620	366	3,362
Capital equipment	570	900	—	1,470
	946	3,520	366	4,832

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The following tables represent other geographic information for the six months ended June 30, 2026 and the year ended December 31, 2025:


	For the period ended June 30, 2026
	Canada	USA	Germany	China	Finland	Total
	$	$	$	$	$	$
Total assets	51,218	7,215	540	137	3,275	62,385
Intangible assets	121	—	—	—	—	121
Property and equipment	13	389	—	—	154	556
Right-of-use assets	2,763	—	—	—	—	2,763
Amortization of intangible assets	16	—	—	—	—	16
Depreciation of property and equipment	28	169	—	—	22	219


	For the year ended December 31, 2025
	Canada	USA	Germany	China	Finland	Total
	$	$	$	$	$	$
Total assets	63,046	9,791	1,243	137	3,258	77,475
Intangible assets	138	—	—	—	—	138
Property and equipment	41	481	—	—	176	698
Right-of-use assets	184	—	—	—	—	184
Amortization of intangible assets	187	—	—	—	—	187
Depreciation of property and equipment	51	322	—	—	—	373

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

As used in this Quarterly Report on Form 10-Q, the “Company”, the “Registrant”, “we” or “us” refer to Profound Medical Corp. The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and related notes that appear elsewhere in this report. In addition to historical financial information, the following discussion contains forward-looking statements that reflect our plans, estimates, assumptions and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to these differences include those discussed in the Risk Factors section of the Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 5, 2026, and elsewhere in this report under “Part II, Other Information—Item 1A, Risk Factors.” Forward-looking statements include information concerning our possible or assumed future results of operations, business strategies and operations, financing plans, potential growth opportunities, potential market opportunities, potential results of our development efforts or trials, and the effects of competition. Forward-looking statements include all statements that are not historical facts and can be identified by terms such as “anticipates,” “believes,” “could,” “seeks,” “estimates,” “expects,” “intends,” “may,” “plans,” “potential,” “predicts,” “projects,” “should,” “will,” “would” or similar expressions and the negatives of those terms. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Also, forward-looking statements represent our management’s plans, estimates, assumptions and beliefs only as of the date of this report. Except as required by law, we assume no obligation to update these forward-looking statements publicly or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future. Unless stated otherwise, all references to “$” are to United States dollars in thousands and all references to “C$” are to Canadian dollars in thousands.

Overview

We are a commercial-stage medical device company focused on the development and marketing of AI-powered, MRI-guided, incision-free therapies for the ablation of diseased tissue utilizing our platform technologies and leveraging the healthcare system’s existing imaging infrastructure. Our lead product (the “TULSA-PRO system”) combines real-time MRI, robotically driven transurethral sweeping-action thermal ultrasound with closed-loop temperature feedback control for the ablation of prostate tissue. The product is comprised of one-time-use devices and capital equipment that are used in conjunction with a customer’s existing MRI scanner.

We are commercializing TULSA-PRO, a technology that combines real-time MRI, robotically-driven transurethral ultrasound and closed-loop temperature feedback control. The TULSA procedure, performed using the TULSA-PRO system, has the potential of becoming a mainstream treatment modality across the entire prostate disease spectrum; ranging from low-, intermediate-, or high-risk prostate cancer; to hybrid patients suffering from both prostate cancer and benign prostatic hyperplasia (“BPH”); to men with BPH only; and also, to patients requiring salvage therapy for radio-recurrent localized prostate cancer. TULSA employs real-time MR guidance for pixel-by-pixel precision to preserve prostate disease patients’ urinary continence and sexual function, while killing the targeted prostate tissue via a precise sound absorption technology that gently heats it to kill temperature (55-57°C). TULSA is an incision- and radiation-free “one-and-done” procedure performed in a single session that takes a few hours. Virtually all prostate shapes and sizes can be safely, effectively, and efficiently treated with TULSA. There is generally no bleeding associated with the procedure; no hospital stay is required; and most TULSA patients report quick recovery to their normal routine. TULSA-PRO is CE marked, Health Canada approved, and 510(k) cleared by the U.S. Food and Drug Administration (“FDA”).

We are also commercializing Sonalleve, an innovative therapeutic platform that is CE marked for the treatment of uterine fibroids and palliative pain treatment of bone metastases. Sonalleve has also been approved by the China National Medical Products Administration for the non-invasive treatment of uterine fibroids and has FDA approval under a Humanitarian Device Exemption for the treatment of osteoid osteoma. We are in the early stages of exploring additional potential treatment markets for Sonalleve where the technology has been shown to have clinical application, such as non-invasive ablation of abdominal cancers and hyperthermia for cancer therapy.

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Results of Operations

Comparison of Three and Six Months Ended June 30, 2026 and 2025

The following selected financial information as of and for the three and six months ended June 30, 2026 and 2025 have been derived from the unaudited consolidated financial statements and should be read in conjunction with those unaudited consolidated financial statements and related notes.


		For the six months ended June 30,
		2026		2025
		$		$
Revenue		7,820		4,832
Operating expenses		24,866		28,443
Other (income) expense		(2,574)		1,342
Net loss for the period		16,593		26,419
Basic and diluted loss per share		0.46		0.88


		For the three months ended June 30,
		2026		2025		Change
		$		$		$		%
Revenue		2,483		2,211		272		12	%
Cost of sales		536		593		(57)		(10)	%
Gross profit		1,947		1,618		329		20	%
Gross margin

Expenses
Research and development		5,654		6,098		(444)		(7)	%
Selling, general and administrative		7,359		9,326		(1,967)		(21)	%
Total operating expenses		13,013		15,424		(2,411)		(16)	%

Other (income) expense
Net finance (income) expense		(336)		(343)		7		(2)	%
Net foreign exchange (gain) loss		(1,245)		2,168		(3,413)		(157)	%
Total other (income) expense		(1,581)		1,825		(3,406)		(187)	%

Net loss before income taxes		9,485		15,631		(6,146)		(39)	%

Income taxes		55		64		(9)		(14)	%

Net loss attributed to shareholders for the period		9,540		15,695		(6,155)		(39)	%

Other comprehensive (income) loss
Item that may be reclassified to profit or loss
Foreign currency translation adjustment		950		(2,713)		3,663		(135)	%
Net loss and comprehensive loss for the period		10,490		12,982		(2,492)		(19)	%

Loss per share
Basic and diluted net loss per common share		0.26		0.52		(0.26)		(50)	%
Basic and diluted weighted average common shares outstanding		36,350,665		30,053,142

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	For the six months ended June 30,
	2026		2025		Change
	$		$		$		%
Revenue	7,820		4,832		2,988		62	%
Cost of sales	2,041		1,361		680		50	%
Gross profit	5,779		3,471		2,308		66	%
Gross margin

Expenses
Research and development	10,916		10,906		10		—
Selling, general and administrative	13,950		17,537		(3,587)		(20)	%
Total operating expenses	24,866		28,443		(3,577)		(13)	%

Other (income) expense
Net finance (income) expense	(713)		(788)		75		(10)	%
Net foreign exchange (gain) loss	(1,861)		2,130		(3,991)		(187)	%
Total other (income) expense	(2,574)		1,342		(3,916)		(292)	%

Net loss before income taxes	16,513		26,314		(9,801)		(37)	%

Income taxes	80		105		(25)		(24)	%

Net loss attributed to shareholders for the period	16,593		26,419		(9,826)		(37)	%

Other comprehensive (income) loss
Item that may be reclassified to profit or loss
Foreign currency translation adjustment	1,955		(2,816)		4,771		(169)	%
Net loss and comprehensive loss for the period	18,548		23,603		(5,055)		(21)	%

Loss per share
Basic and diluted net loss per common share	0.46		0.88		(0.42)		(48)	%
Basic and diluted weighted average common shares outstanding	36,324,393		30,055,047

Key Components of Our Results of Operations

Revenue

We deploy a hybrid revenue business model in the United States to market TULSA-PRO by charging for the system separately as capital and an additional charge for the one-time-use devices. The Sonalleve product is marketed primarily outside North America deploying a one-time capital sales model with limited recurring service revenue. Outside of North America, we generate most of our revenues from our system sales (both TULSA-PRO and Sonalleve) in Europe and Asia where we deploy a hybrid business model, charging for the system separately as capital and an additional charge for the one-time-use devices. Revenue is comprised of (a) recurring – non-capital revenue, which consists of the sale of one-time-use devices and services associated with maintenance contracts and (b) capital equipment, which is the one-time sale of capital equipment and the lease of capital equipment.

For the three months ended June 30, 2026, we recorded revenue totaling $2,483, consisting of $871 from the one-time sale of capital equipment and $1,612 from recurring – non-capital revenue. For the three months ended June 30, 2025, we recorded revenue of $2,211, consisting of $650 from the one-time sale of capital equipment and $1,561 from recurring – non-capital revenue. The increase of $272, or 12%, in revenue for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 was the result of higher recurring revenue and capital sales overseas during the second quarter of 2026.

For the six months ended June 30, 2026, we recorded revenue totaling $7,820, consisting of $3,734 from the one-time sale of capital equipment and $4,086 from recurring – non-capital revenue. For the six months ended June 30, 2025, we recorded revenue of $4,832, consisting of $1,470 from the one-time sale of capital equipment and $3,362 from recurring – non-capital revenue. The increase

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of $2,988, or 62%, in revenue for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 was driven by higher capital sales in the United States and overseas.

Cost of Sales

Cost of sales primarily includes the cost of finished goods, depreciation of equipment under lease, inventory write-downs, royalties, warranty expenses, freight and direct overhead and labor expenses necessary to acquire or manufacture the finished goods.

For the three months ended June 30, 2026, we recorded a cost of sales of $536, related to the sale of medical devices, capital and non-capital, which reflects 78% gross profit. For the three months ended June 30, 2025, we recorded a cost of sales of $593, which reflects a 73% gross profit. The decrease of $57, or 10%, in cost of sales for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 was the result of the sale of multiple systems under existing operating leases to customers. The gross profit was higher in the three months ended June 30, 2026 by $329, or 20%, due to growth in the number of one-time-use devices sold.

For the six months ended June 30, 2026, we recorded a cost of sales of $2,041, related to the sale of medical devices, capital and non-capital, which reflects a 74% gross profit. For the six months ended June 30, 2025, we recorded a cost of sales of $1,361, which reflects a 72% gross profit. The increase of $680, or 50%, in cost of sales for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 was the result of a different product combination whereby more capital equipment was sold which contains a higher margin. The gross profit was higher in the six months ended June 30, 2026 by $2,308, or 66%, due to growth in the number of capital systems sold.

Operating Expenses

Operating expenses consist of two components: research and development (“R&D”) and selling, general and administrative (“SG&A”).

R&D Expenses

R&D expenses are comprised of costs incurred in performing R&D activities, including new product development, continuous product improvement, investment in clinical trials and related manufacturing costs, materials and supplies, salaries and benefits, consulting fees, patent procurement costs, and occupancy costs related to R&D activity.

For the three months ended June 30, 2026, R&D expenses decreased by $444, or 7%, to $5,654 compared to $6,098 for the three months ended June 30, 2025. The decrease in R&D expenses was largely due to a reduction in clinical trial costs due to CAPTAIN trial enrollment completion. Offsetting these costs was an increased headcount, travel expenditures and higher consulting expenditures due to spending on R&D initiatives to reduce product costs and improve quality and efficiencies of our products.

For the six months ended June 30, 2026, R&D expenses increased by $10, or nil%, to $10,916 compared to $10,906 for the six months ended June 30, 2025. The increase in R&D expenses was largely due to increased headcount, travel expenditures and higher consulting expenditures due to spending on R&D initiatives to reduce product costs and improve quality and efficiencies of our products. Offsetting these costs were a reduction in clinical trial costs due to CAPTAIN trial enrollment completion.

These expenses emphasize our commitment to the ongoing development and improvement of the products while further demonstrating the commitment to a reliable and customizable product.

SG&A expenses

Selling, general and administrative expenses are comprised of business development costs related to the market development activities and commercialization of our systems, including salaries and benefits, marketing support functions, occupancy costs, insurance, various management and administrative support functions and other miscellaneous marketing and management costs.

SG&A expenses for the three months ended June 30, 2026 decreased by $1,967, or 21%, to $7,359 compared to $9,326 for the three months ended June 30, 2025. The decrease in SG&A was primarily due to decreased salary and commission expenses related to lower headcount in sales force, a reduction in travel expenses, an overall discount in our insurance premiums for the same coverage from the prior year and a reduction in bad debt expense. Offsetting these expenses was an increase in promotion and marketing expenses.

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Use of Proceeds

2025 Offering and non-brokered private placement

We received net proceeds of $40,801 from the public offering and the private placement (together, the “2025 Offering”) completed in December 2025. We intend to use net proceeds from the 2025 Offering to fund the continued commercialization of the TULSA-PRO system in the United States, the continued development and commercialization of the TULSA-PRO system and the Sonalleve system globally and for working capital and general corporate purposes. In addition, there have been no material adjustments to the cost or timing of the business objective previously disclosed in such prospectus supplement.


		Total spending of proceeds
		from the 2025
		Offering as of
		June 30, 2026
		$
TULSA-PRO commercialization		17,075
Sonalleve development and commercialization		4,269
Working capital and general corporate purposes		5,563
Total		26,907

CIBC Loan

On March 3, 2025, we entered into an amended and restated credit agreement (the “CIBC Credit Agreement”) with Canadian Imperial Bank of Commerce (“CIBC”), which amended the terms of the loan with CIBC (the “CIBC Loan”) and the existing long-term debt provided under the original credit agreement with CIBC was repaid with proceeds from a new revolving line of credit provided by CIBC to us. The line of credit bears interest at the Wall Street Journal Prime Rate subject to a floor of 6.25%. Following an amendment to the CIBC Credit Agreement on September 30, 2025, the amended financial covenants are that unrestricted cash is at all times greater of: (i) to the extent that EBITDA is a negative number or loss for the most recent six-month period, the amount of such loss, or (ii) $10,000, reported on a monthly basis and that revenue for the 12 month period must be 15% greater than revenue for the same period in the prior fiscal year, reported on a quarterly basis. We are in compliance with these financial covenants as of June 30, 2026. Future compliance with the financial covenants included in the CIBC Credit Agreement is dependent upon achieving certain revenue, EBITDA, and anticipated unrestricted cash levels.

The obligations are secured by, inter alia, a general security agreement over our assets and the assets of our subsidiaries. The revolving line of credit matures on March 3, 2027 and provides an option to increase the amount of the revolving commitment by $5,000 within 18 months from March 3, 2025, subject to achieving a minimum trailing 12 month revenue exceeding $15,000. The exercise of the option would result in the size of the revolving commitment increasing from $10,000 to a maximum of $15,000. Additionally, the CIBC Credit Agreement provides that we may request a one-time increase in the principal amount of the revolving line of credit up to a maximum amount of $10,000, which is subject to the approval of CIBC in its sole discretion.

Cash Flows

The following table summarizes our cash flows for each of the periods presented (in thousands):


	Six months ended June 30,
	2026		2025
	$		$
Cash provided by (used in) operating activities	(19,921)		(22,027)
Cash provided by (used in) financing activities	—		(290)
Foreign exchange on cash	(1,531)		2,600
Net increase (decrease) in cash	(21,452)		(19,717)

Operating Activities

Net cash used in operating activities for the six months ended June 30, 2026 was $(19,921), primarily attributable to a net loss of $16,593 and $5,593 in net operating assets and liabilities, partially offset by $2,265 of non-cash charges. The cash used in operating

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activities was primarily due to the increased efforts supporting the commercialization and expansion of our products. This resulted in an increase in marketing and promotion fees and increased travel. Non-cash charges consisted primarily of share-based compensation, amortization and depreciation.

Net cash used in operating activities for the six months ended June 30, 2025 was $(22,027). The principal use of the operating cash flows during the period related to a net loss of $26,419 and an increase in net operating assets and liabilities of $1,616 and non-cash charges of $2,776. The cash used in operating expenses was primarily due to the increased efforts supporting the commercialization and expansion of our products. This resulted in an increase in headcount, travel, clinical trial costs and marketing fees. Non-cash charges consisted primarily of share-based compensation, amortization and depreciation.

Financing Activities

Net cash provided by (used in) financing activities for the six months ended June 30, 2026 was $nil.

Net cash provided by (used in) financing activities for the six months ended June 30, 2025 was $(290) from the repayments of long-term debt principal.

Foreign Exchange on Cash

Cash was impacted by the change in the foreign exchange rates for the Company’s foreign currency denominated cash. The value of our currencies decreased, resulting in a decrease in our cash holdings.

Funding Requirements

Based on our current operating plans, we expect that our existing cash and sales of our products and services will enable us to fund our operating expenses and capital expenditure requirements for at least the next 12 months from the date of the issuance of these unaudited consolidated financial statements. During that time, we expect that our expenses will increase, primarily due to the continued commercialization of TULSA-PRO and Sonalleve.

We manage liquidity risk by monitoring actual and projected cash flows. A cash flow forecast is performed regularly to ensure that we have sufficient cash to meet our operational needs while maintaining sufficient liquidity. Our cash requirements depend on numerous factors, including market acceptance of our products, the resources devoted to developing and supporting the products and other factors. We expect to continue to devote substantial resources to expand procedure adoption and acceptance of our products.

We may require additional capital to fund R&D activities and any significant expansion of operations. Potential sources of capital could include equity and/or debt financings, development agreements or marketing agreements, the collection of revenue resulting from future commercialization activities and/or new strategic partnership agreements to fund some or all costs of development. There can be no assurance that we will be able to obtain the capital sufficient to meet any or all of our needs. The availability of equity or debt financing will be affected by, among other things, the results of R&D, our ability to obtain regulatory approvals, the market acceptance of our products, the state of the capital markets generally, strategic alliance agreements and other relevant commercial considerations. In addition, if we raise additional funds by issuing equity securities, existing security holders will likely experience dilution, and any incurring of indebtedness would result in increased debt service obligations and could require us to agree to operating and financial covenants that would restrict operations. Any failure on our part to raise additional funds on terms favorable to us or at all may require us to significantly change or curtail current or planned operations in order to conserve cash until such time, if ever, that sufficient proceeds from operations are generated, and could result in us not being in a position to take advantage of business opportunities, in the termination or delay of clinical trials for our products, in curtailment of product development programs designed to identify new products, in the sale or assignment of rights to technologies, product and/or an inability to file market approval applications at all or in time to competitively market products.

Critical Accounting Policies and Estimates

There have been no significant changes to our critical accounting policies since December 31, 2025. For a description of critical accounting policies that affect our significant judgments and estimates used in the preparation of our unaudited condensed consolidated financial statements, refer to Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” contained in our Annual Report on Form 10-K dated March 5, 2026.

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Recent Accounting Pronouncements

See Note 2 to our Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q, which is incorporated herein by reference.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Not applicable.

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Our management maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in our periodic and current reports that we file with the SEC is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives, and management necessarily applies its judgment in evaluating the cost benefit relationship of possible controls and procedures.

Our principal executive officer and principal financial officer, after evaluating the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of June 30, 2026, have concluded that, based on such evaluation, our disclosure controls and procedures were effective 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 and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. You should read this description of our controls and procedures together with “Item 9A. Controls and Procedures” included in our Annual Report on Form 10-K, which was filed with the SEC on March 5, 2026.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting, as identified in connection with evaluation required by Rules 13a-15(e) and 15d-15(e) under the Exchange Act, that occurred during the three months ended June 30, 2026 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II—OTHER INFORMATION

Item 1. Legal Proceedings.

From time to time, we may be subject to legal proceedings. We are not currently a party to or aware of any proceedings that we believe will have, individually or in the aggregate, a material adverse effect on our business, financial condition or results of operations. Regardless of outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources, and other factors.

Item 1A. Risk Factors.

Our business is subject to a number of risks, including risks that may prevent us from achieving our business objectives or may adversely affect our business, financial condition, results of operations, cash flows, and prospects. These risks are discussed more fully in the section entitled “Risk Factors” in our Annual Report on Form 10-K filed with the SEC on March 5, 2026 (the “2025 Annual Report”). There have been no material changes to the risk factors described in the 2025 Annual Report.

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

None.

Table of Contents

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

None.

Item 5. Other Information.

Rule 10b5-1 Trading Plans

During the three months ended June 30, 2026, none of our directors or executive officers adopted, modified or terminated any contract, instruction or written plan for the purchase or sale of our securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement” as defined in Item 408(c) of Regulation S-K.

Item 6. Exhibits.

Exhibit Number		Exhibit Description		Filed with this Report		Incorporated by Reference herein from Form or Schedule		Filing Date		SEC File/Reg. Number
3.1		Articles of Incorporation				Form S-8 (Exhibit 4.1)		11/7/2019		333-234574
3.2		Articles of Amendment				Form S-8 (Exhibit 4.2)		11/7/2019		333-234574
3.3		Articles of Amalgamation				Form S-8 (Exhibit 4.3)		11/7/2019		333-234574
3.4		Bylaws				Form S-8 (Exhibit 4.4)		11/7/2019		333-234574
31.1		Certification of the Company’s Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002		X
31.2		Certification of the Company’s Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002		X
32†		Certification of the Company’s Principal Executive Officer and Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002		X

† 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 the Company 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 such Form 10-Q), irrespective of any general incorporation language contained in such filing.

	PROFOUND MEDICAL CORP.

Date: August 6, 2026	By:	/s/ Arun Menawat
		Name: Arun Menawat
		Title: Chief Executive Officer
		(Principal Executive Officer)

Date: August 6, 2026	By:	/s/ Rashed Dewan
		Name: Rashed Dewan
		Title: Chief Financial Officer
		(Principal Financial and Accounting Officer)


		Page
PART I.	Financial Information
Item 1.	Condensed Consolidated Financial Statements
	Condensed Consolidated Balance Sheets (Unaudited)	1
	Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited)	2
	Condensed Consolidated Statements of Shareholders’ Equity (Unaudited)	3
	Condensed Consolidated Statements of Cash Flows (Unaudited)	5
	Notes to Condensed Consolidated Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	16
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	23
Item 4.	Controls and Procedures	23
PART II.	Other Information	23
Item 1.	Legal Proceedings	23
Item 1A.	Risk Factors	23
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	23
Item 3.	Defaults Upon Senior Securities	24
Item 4.	Mine Safety Disclosures	24
Item 5.	Other Information	24
Item 6.	Exhibits	24
Signatures		25