4DMedical Limited

The Business

4DMedical sells CT:VQ, a software platform that turns a standard CT scanner into a lung ventilation and perfusion imaging tool, replacing the 40-year-old nuclear medicine scan that requires radioactive tracers and specialist technologists. The company has secured both FDA clearance and a dedicated CMS reimbursement code paying US$650.50 per scan, versus roughly US$1,150 for the nuclear alternative. Revenue comes from a software-as-a-service model: hospitals and imaging centres pay per scan, with 4DX collecting a share of the CMS payment. Distribution runs through a partnership with Philips and adoption at five academic medical centres.

Recent Performance

Revenue grew 21% in FY26 to $7.1m, a modest base that reflects a company still in early commercial rollout rather than scaled sales. Scan volumes rose 77% over the same period, but revenue per scan actually fell 32%, from roughly $30 to $20.50, because most volume growth came from lower-priced established products rather than the higher-value CT:VQ scans. The stock's inclusion in the ASX 200 and a $233m capital raise this year reflect strong investor appetite for the story, pushing the market capitalisation to roughly $2.2bn.

Outlook

Our forecast has revenue growing substantially over the coming years, driven by CT:VQ scans becoming a larger share of total volume and revenue per scan rising well above current levels as the higher-value product mix builds. Gross margin should hold near 92%, typical for software economics, but the company remains loss-making across the forecast period. The EBITDA margin is expected to improve materially from its current deeply negative level, though we do not model sustained profitability for several years yet, as fixed costs are absorbed gradually by a growing revenue base.

Key Risks

Clinical workflow inertia is the largest risk to the thesis. Nuclear ventilation-perfusion scanning has been the clinical standard for more than 40 years, and if adoption fails to cascade beyond academic medical centres into community and outpatient settings, revenue growth stalls well short of the scale needed for profitability. The second risk is that 4DX has not disclosed its actual revenue per CT:VQ scan, so the take rate assumption embedded in any model of this business carries genuine uncertainty that will only resolve as further quarterly disclosures accumulate. Third, because the company remains loss-making for years under most reasonable scenarios, a large share of any valuation necessarily rests on assumptions about the business a decade or more from now rather than on near-term, observable cash flows.

What to Watch

The thesis-defining event is the FY27 first-quarter update, which will reveal whether revenue per scan is finally inflecting upward as CT:VQ mix grows.

• Nov 2026 FY27 Q1 revenue/scan disclosure — first hard data on whether the CT:VQ take rate supports a bullish or bearish read on the commercial model.
• H1 FY27 Private payer coverage announcements — needed to expand beyond the Medicare-eligible patient population.
• FY28 CLEAR pulmonary embolism study interim data — could materially expand the addressable market if positive.

Company Description

4DMedical is a single-product medtech software company built around CT:VQ, a lung ventilation and perfusion imaging platform. The core technology captures four-dimensional lung motion data from a standard CT scan, using proprietary software (not new hardware) to detect ventilation and perfusion defects that indicate disease. Commercialisation runs through direct sales to academic medical centres and a distribution partnership with Philips, which carries contractual minimum order commitments through CY26-27. The company has also made two small acquisitions, RevealDx and contextflow, to add complementary AI diagnostic capability and a European distribution footprint.

Where the Growth Is

The entire growth story rests on the CT:VQ scan mix shift. CT:VQ currently makes up less than 5% of total scan volume, with the bulk of the current 344,000 scans coming from lower-priced, established products at roughly $15-20 each. As CT:VQ scans grow toward a meaningfully larger share of the mix over the coming years, blended revenue per scan should rise well above today's $20.50 level. This mix shift is the single largest driver of the entire revenue forecast, more important to the outcome than total scan volume growth on its own.

Competitive Position

4DMedical is the only FDA-cleared, CMS-reimbursed CT-based ventilation-perfusion imaging product on the market, and no competing 510(k) filing has been identified. This first-mover position is reinforced on three fronts: the regulatory pathway (FDA clearance took years to secure), the economic pathway (a dedicated CMS reimbursement code at $650.50 per scan), and the clinical pathway (growing published evidence from five academic medical centres). Replicating all three would likely take a competitor three to five years, and the advantage is widening as clinical evidence accumulates. The company holds under 1% share of the roughly $1.1bn addressable US nuclear VQ market, leaving substantial room to grow before competitive response becomes a near-term concern.

Management & Capital Discipline

Management has raised $309m across multiple funding rounds and used it to fund FDA clearance, CMS reimbursement, the Philips distribution deal, and two acquisitions. Cash employee costs fell 11% year-on-year in FY26 even as revenue grew, showing some willingness to control spending. That said, every binary regulatory milestone has been delivered, but converting that into disciplined commercial execution is untested. Share-based compensation spiked five-fold to $13m in FY26, a scale that warrants monitoring for shareholder alignment given the company remains years from profitability.

Financial Position

4DMedical holds approximately $254m in cash following its recent capital raises and acquisitions, against modest debt obligations tied to a Pro Medicus funding facility. At the current burn rate, this provides more than seven years of runway, and interest income on the cash balance (an estimated $8-10m annually) offsets roughly a quarter of ongoing losses. On this basis, the company can comfortably fund its commercialisation plan through to breakeven without needing further dilutive capital in our base case.