Q & A Highlights

Q: Can you provide incremental details on the sequential decline in B2B2C revenue and how we should think about the magnitude of acceleration in the back half from recent health plan wins? A: Erez Raphael, CEO, explained that the slight decline is due to additional cleanup following the transformation and closing of the pharma channel. The company has signed accounts with contracted ARR of $13.1 million, which they expect to convert into actual revenues over the next few quarters. They anticipate revenue gaining traction in the second half of the year, with growth between Q3 and Q4 and more momentum into Q1 of next year. He emphasized that the P&L is now much more efficient, so every additional dollar from signed accounts will be extremely efficient in reducing losses.

Q: How does DarioIQ's expected 10% to 15% increase in B2B2C ARR from existing customers show up commercially? Is it pricing, PMPM increases at renewal, and is it included in the $13.1 million ARR? A: Erez Raphael, CEO, clarified that DarioIQ improves member engagement, retention, and clinical outcomes, which generates additional revenue from the existing book of business. This is separate from the $13.1 million contracted ARR, which represents new business or expansions into additional conditions. He also noted that agentic AI is being used internally to reduce OpEx by taking over roles in the value chain, but the majority of the value will come from more engaged and retained members with better outcomes.

Q: Can you quantify how implementation time and time to ROI differ for a client landed through a channel partner versus a direct enterprise sale? A: Erez Raphael, CEO, stated that the main difference depends on the client profile rather than the channel. Employers typically roll out in January of the next year (about 75% of cases), while health plans usually enroll members three to six months after signing. He highlighted that some channel partners take responsibility for enrollment, which creates a better ROI for Dario as they don't need to spend sales and marketing resources on enrollment, leading to a stronger P&L profile with almost zero spend for winning and enrolling members.

Q: What percentage of the 13 billion data points underlying DarioIQ are first-party data from Dario's own devices versus third-party data, and how well is the value of that data realized today? A: Erez Raphael, CEO, explained that due to compliance aspects, the majority of data used for R&D and training models comes purely from the B2C business. Dario operates both B2C and B2B, but for training models and developing new features, they use B2C data first, learning patterns and improving the user journey, especially for multi-condition management. This approach allows them to implement AI capabilities in a highly regulated market, moving innovations from B2C to B2B after validation.

Q: With 75% of new accounts now coming through channel partners, how does this shift impact the company's sales cycle and customer acquisition costs? A: Lara Dodo, COO, noted that this structural shift gives Dario access to employers and plan populations they previously couldn't reach, with shorter sales cycles and materially lower customer acquisition costs. Nearly half of all private sector employees work for small businesses, which are difficult to reach through direct enterprise sales. The channel partner network allows Dario to access these employers at scale, diversifying the client base while sales and marketing spend continues to decline.

Q: Can you elaborate on the expansion with one of the five largest health insurers and the potential to triple the revenue opportunity? A: Lara Dodo, COO, confirmed that during the quarter, a top-five health insurer expanded its relationship by adding hypertension to its existing behavioral health program. This expansion has the potential to approximately triple Dario's revenue opportunity under that relationship. It marks the third health plan customer to expand beyond an initial deployment, demonstrating the success of the multi-condition platform strategy.

Q: How does the contracted annual recurring revenue (ARR) convert into recognized revenue, and what is the typical timeline? A: Lara Dodo, COO, explained that contracted ARR does not convert on the day an agreement is signed. Three things happen in sequence: program launch is set by plan year cycles and open enrollment windows; eligible members enroll progressively over quarters; and customers expand into additional conditions. From signature to full run-rate revenue typically takes four to five quarters. The company ended Q2 with approximately $13.1 million in contracted and late-stage ARR, with more than 80% being multi-condition, expected to convert into revenue in the second half of 2026 with the majority showing up in 2027.

Q: What is the company's current cash position and how does it support the path to profitability? A: Chen Franco-Yehuda, CFO, reported a pro forma cash position of $36.8 million as of June 30, 2026, including $14 million in cash and short-term deposits plus $22.8 million net from a registered direct financing closed in July. The financing was priced at the market with participation from existing long-term shareholders and new institutional investors. This provides the cash runway to execute on commercial opportunities and advance the path to cash flow positivity, with new implementations expected to contribute more meaningfully at the end of 2026 and ramp throughout 2027.

Q: How is the company leveraging AI to reduce operating expenses while scaling the business? A: Chen Franco-Yehuda, CFO, highlighted that Dario increased the use of AI within its own operations, helping to hold the line on costs even as the business scales. This contributed to an 80% sequential reduction in operating expenses and a 21% year-over-year decrease, while improving operating loss by 11% quarter-over-quarter and 30% year-over-year. The operating leverage embedded in the business model means that as new customers are implemented and existing customers expand, revenues can leverage the existing technology platform and infrastructure.

Q: Can you provide details on the new GLP-1 program and its distribution channels? A: Lara Dodo, COO, stated that weeks after announcing the provider-backed care strategy, Dario launched an integrated GLP-1 program combining AI-powered engagement with licensed provider evaluation and access to FDA-approved GLP-1 therapies. The program is available through three channels: Dario's direct-to-consumer shop, B2B2C employer programs, and health plan marketplaces. This rapid launch was possible because the technology platform, AI

For the complete transcript of the earnings call, please refer to the full earnings call transcript .