Thank you for standing by. Welcome to the Pulmonx Q4 2022 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, press star one one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Laine Morgan at Gilmartin Group. Thank you, operator. Good afternoon, thank you all for participating in today's call. Joining me from Pulmonx are Glen French, President and Chief Executive Officer, and Derrick Sung, Chief Financial Officer. Earlier today, Pulmonx issued a press release announcing its financial results for the fourth quarter and year ended December 31st, 2022. A copy of the press release is available on Pulmonx's website. Before we begin, I'd like to remind you that management will make statements during this call that include forward-looking statements within the meaning of federal securities laws, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Any statements contained in this call that relate to expectations or predictions of future events, results, or performance are forward-looking statements. All forward-looking statements, including, without limitation, those relating to our operating trends, commercial strategies, and future financial performance, the timing and result of clinical trials, the impact of COVID-19 on our business and prospects for recovery, expense management, expectations for hiring, growth in our organization, market opportunity, guidance for revenue, gross margin, operating expenses, commercial expansion, and product pipeline development are based upon our current estimates and various assumptions. These statements involve material risks and uncertainties that could cause actual results or events that materially differ from those anticipated or implied by these forward-looking statements. Accordingly, you should not place undue reliance on these statements. For a list and description of the risks and uncertainties associated with the business, please refer to the Risk Factors section of our filings with the Securities and Exchange Commission, including our quarterly report on Form 10-Q filed with the SEC on November 8, 2022. Also during this call, we will discuss certain non-GAAP financial measures. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are provided in the press release, which is posted in our investor relations website. These non-GAAP measures are not intended to be a substitute for our GAAP results. This conference contains time-sensitive information and is accurate only as of the live broadcast today, February 22, 2023. Pulmonx disclaims any intention or obligation, except as required by law, to update or revise any financial projections or forward-looking statements, whether because of new information, future events, or otherwise. With that, I'll turn the call over to Glen. Thanks, Laine. Good afternoon, everyone, welcome to our fourth quarter and full year 2022 earnings call. Here with me is Derrick Sung, our Chief Financial Officer. I'll begin with a few highlights to contextualize our fourth quarter and full year 2022 results before turning to our outlook and strategic priorities for 2023. 2022 was a foundational year for Pulmonx, in which we finally emerged after more than two years of intermittent disruptions into a more normalized environment that allows us to resume building the basis for long-term sustainable growth, with a focus on developing our accounts to establish our Zephyr Valve procedure as a standard of care for the treatment of patients with severe COPD. For the full year 2022, we achieved $53.7 million in worldwide sales, growing our business 11% as reported, and 16% on a constant currency basis over 2021. Further, we delivered full year 2022 revenue in the U.S. of $32.5 million, representing growth of 30% over 2021. On top of this, we also made substantial progress on our commercial and clinical initiatives. Specifically, we increased our U.S. commercial footprint in 2022, adding 64 new treating centers, and thereby taking our total to 278 centers, and this provides a solid base as we focus increasingly on account development and penetration. We saw two encouraging clinical data readouts on our AeriSeal technology. Our ongoing CONVERT multi-center, multinational trial in Europe, a single center feasibility study in Australia both revealed early signs that AeriSeal can successfully close air channels between lobes of the lungs, thereby allowing patients with collateral ventilation to be treated successfully with Zephyr Valves. Lastly, we received regulatory approval for our Zephyr Valve procedure in Japan and are presently working to establish reimbursement there later this year. To cap off the year, we ended the fourth quarter with global sales of $15.4 million, our highest quarterly revenue to date, driven by another record U.S. Performance of $9.5 million in sales, representing 30% growth over the same period last year. Looking ahead, we are focused on continuing to ensure our procedure is done efficiently and routinely in our target hospitals. While we expect some of the macro winds seen in 2022 to continue into this year, we are confident in our ability to push through these headwinds. We've made good initial progress increasing efficiency in our high-potential accounts and intend to continue to ramp these efforts, maintaining our expectation that these will translate directly and substantially to revenue growth in the back half of this year. Taking this into account, we anticipate full year 2023 revenue to be in the range of $63 million-$65 million. As a reminder, our strategy is three-pronged. First, selecting, training and launching accounts that we believe based on our comprehensive assessment criteria, have the potential to be strong Zephyr Valve centers. Second, increasing the efficiency and procedural capacity of our accounts by encouraging best practices with our physician and administrative champions. Finally, increasing center volumes by building local awareness of the substantial benefits of Zephyr Valve with both emphysema patients and the physicians who manage them, thereby developing a strong referral network. Relative to assessing and launching new accounts, we were pleased to add 17 new U.S. treating centers in the fourth quarter, bringing our total number to 278. While our focus will remain throughout 2023 on developing this cohort into high volume accounts, we expect to selectively identify and establish an additional 40-50 new accounts through the year. These will be accounts that are committed to developing a comprehensive Zephyr Valve program to deliver clinical efficiency and excellence. Looking forward, we believe that account activity and account productivity will be the best metrics to measure our progress in increasing efficiency and sales across our existing base of U.S. treating centers. We define account activity as the percentage of trained treating centers that place a revenue-generating order in a given quarter. In the fourth quarter of 2022, U.S. account activity was 73%, which represents a resumption of activity to a more normalized level in a post-pandemic environment. We expect that account activity will remain in the 75% range as we continue to grow our denominator of treating centers. We define account productivity as the average number of cases conducted in a given quarter by our active and established Zephyr Valve treating centers, which are those that have been performing Zephyr Valve procedures for at least three quarters and have placed a revenue-generating order in the subject quarter. After emerging from the most recent wave of COVID pandemic, the average productivity in our active established accounts across the last three quarters of 2022 ranged between four and five cases per quarter. More specifically, active established account productivity was approximately 4.8 cases in the fourth quarter of 2022. We see this as the most critical metric by which to measure the success of our account development and strategy, and expect to see the average account productivity in our active established accounts increase in the second half of the year as we realize the initial benefits from our refocused strategy. Importantly, we feel strongly that we can accomplish our commercial goals this year with our existing footprint of sales territories, which at year-end consisted of 55 in the U.S. and 36 internationally. While we expect to continue to opportunistically add sales resources in select geographies, we are confident that this team can effectively cover and grow our target markets. Part of our initiative to expand productivity focuses on building awareness of the benefits of Zephyr Valve procedure among COPD physicians. To this end, we're pleased to have partnered with Medscape and the American College of Chest Physicians to launch physician education programs on Zephyr Valves and are already seeing strong physician engagement in these programs. We expect these partnerships to continue to facilitate our efforts to increase awareness with COPD physicians on how Zephyr Valves may substantially improve the lives of their patients with COPD and emphysema, and we intend to look for incremental opportunities to advance these collaborations. Beyond these initiatives, within existing markets, we are continuing to pursue ways to further tap into and expand what we believe to be a $12 billion global market opportunity. Toward this end, we received regulatory approval in Japan for our Zephyr Valve treatment late last year. Our team is now working diligently toward the establishment of reimbursement and the subsequent commercial market introduction in Japan, which we expect late this year. As a reminder, we estimate Japan to be a $1 billion market opportunity with approximately 100,000 patients who stand to benefit from our treatment. Further, with regard to expanding our addressable market, we continue to view AeriSeal as a possible way to leverage the large number of severe COPD patients with collateral ventilation who are not candidates today for treatment with Zephyr Valves. Last year, interim findings from our ongoing multi-center, multinational CONVERT trial showed AeriSeal successfully converted 78% of the first 40 patients in the study to having little to no collateral ventilation. These patients were then successfully treated with Zephyr Valves. We expect to complete trial enrollment this year with final data presented next year. Also, learnings from the CONVERT trial contribute to our dialogue with FDA regarding an IDE and related clinical protocol that we expect to initiate before the end of this year. With that, I'll now turn the call over to Derrick to provide a more detailed review of our fourth quarter results. Thank you, Glenn, and good afternoon, everyone. Total worldwide revenue for the three months ended December 31st, 2022 was a record $15.4 million, a 13% increase from $13.7 million in the same period of the prior year, and an increase of 18% on a constant currency basis. U.S. revenue in the fourth quarter reached a new high of $9.5 million, a 30% increase from $7.3 million during the prior year period. The growth in U.S. sales reflected continued commercial momentum and adoption of our Zephyr Valve therapy as we move into a more stabilized environment. International revenue in the fourth quarter of 2022 was $6 million, a 7% decrease from $6.4 million during the same period last year, and an increase of 5% on a constant currency basis as international sales growth was negatively impacted by foreign currency exchange rates. Notably, our fourth quarter international performance reflected a rebound from the more pronounced summer seasonality that we experienced during the third quarter in certain markets. Gross margin for the fourth quarter of 2022 was 73% compared to 75% in the prior year period, reflecting slightly lower capacity utilization. In 2023, we expect gross margin to fall within the range of 73%-74%, remaining near 73% in the first half of the year and then trending towards 74% in the back half of the year. Total operating expenses for the fourth quarter of 2022 were $25.8 million, a 14% increase from $22.6 million in the fourth quarter of 2021. Non-cash stock-based compensation expense was $4.1 million in the fourth quarter of 2022. Excluding stock-based compensation expense, total operating expenses in the fourth quarter of 2022 increased 10% from the same period of the prior year. Looking ahead, we expect operating expenses for the full year 2023 to fall between $112 million-$114 million, inclusive of approximately $22 million of non-cash stock-based compensation expense as we take a disciplined and prudent approach to managing expenses while continuing to invest to drive growth. Excluding non-cash stock-based compensation expense, our operating expense guidance implies an increase in operating expense of 9%-11% in 2023 over the prior year, demonstrating operating leverage as we expect to increase our cash operating expenses at a meaningfully lower rate than we expect to grow revenue. R&D expenses for the fourth quarter of 2022 were $3.9 million compared to $3.7 million in the same period of the prior year. The increase was primarily attributable to an increase in stock-based compensation expense. Sales, general and administrative expenses for the fourth quarter of 2022 were $21.9 million compared to $18.9 million in the fourth quarter of 2021. The increase was primarily attributable to an increase in sales and marketing expenses as we expanded our commercial team and increased commercial activities, as well as an increase in stock-based compensation expense. Net loss for the fourth quarter of 2022 was $14.3 million, or a loss of $0.38 per share, as compared to a net loss of $13 million or a loss of $0.35 per share for the same period of the prior year. An average weighted share count of 37.4 million shares was used to determine loss per share for the fourth quarter 2022. Beginning this quarter, we will be reporting on Adjusted EBITDA, which we believe is representative of the ongoing operating performance of our business. Adjusted EBITDA reflects our net loss before interest, taxes, depreciation, and amortization expense and also excludes non-cash stock-based compensation expense. Adjusted EBITDA loss for the fourth quarter of 2022 was $9.8 million, as compared to $9.4 million in the fourth quarter of 2021. We ended December 31st 2022 with $147.1 million in cash equivalents, and marketable securities, a decrease of $9.8 million from September 30th 2022. Earlier this week, we further strengthened our balance sheet by drawing down the remaining $20 million provided by our existing term loan, bringing the total amount drawn on this credit facility to $37 million. Including this recent drawdown, our cash position at the end of 2022 would have been approximately $167 million. We felt it prudent to take advantage of the favorable terms of the loan to provide ourselves with the greatest degree of financial flexibility to invest in our business. As a reminder, we recently refinanced this credit facility in October of last year at an attractive rate of prime plus 1% and extended the maturity date out another five years with at least two additional years of interest-only payments. We remain confident that we can reach cash flow breakeven in our existing current operations with the capital that we have on hand and continue to expect our annual cash burn to decrease as we grow our top line and drive operating leverage. Turning to our revenue outlook for 2023. We expect to deliver full year 2023 revenue in the range of $63 million-$65 million. Our guidance assumes foreign currency exchange rates will be relatively neutral to growth on an annual basis, with foreign exchange remaining a headwind to growth in the first half of the year and then transitioning to a tailwind in the back half of 2023. We expect sales in the first quarter of 2023 to be sequentially lower than the fourth quarter of last year, as we've typically seen in the past. Lastly, I'd like to mention that in December 2022, we received a civil investigative demand from the U.S. Department of Justice in connection with a request for information under the False Claims Act and the Anti-Kickback Statute. The CID requests information in connection with the sales and marketing of Zephyr Valves and related products and services. We maintain policies and procedures to promote compliance with the Anti-Kickback Statute, False Claims Act, and other applicable laws and regulations, and are fully cooperating with this investigation. While we cannot at this time reasonably predict the duration or outcome of this matter, I would emphasize that at this time, we do not view this as a barrier to growth or a hindrance to the implementation of our commercial strategy. With that, I will now turn the call back to Glen for closing comments. Thanks, Derrick. In summary, we look forward to delivering strong growth in 2023, particularly in the back half of the year as we build on our momentum with a refocused team and strategy. We remain confident in our commercial efforts to scale accounts while also selectively adding new ones, in addition to our efforts to start selling product in Japan before the end of the year. We also look forward to progressing the development of AeriSeal, which offers an opportunity to significantly expand our target market by possibly offering the benefits of Zephyr Valves to patients who are not currently candidates for the procedure. Taken together, we expect to execute on both commercial and clinical development objectives and thereby deliver strong growth in 2023 and beyond. With that, I'd like to thank you all for your attention, and we will now open up the call for questions. Operator? Thank you. At this time, we will conduct a question and answer session. As a reminder, to ask a question, you will need to press star one one on your telephone and wait for your name to be announced. To withdraw your question, press star one one again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Rick Wise of Stifel. Your line is now open. Good afternoon, everybody. Nice to see the solid fourth quarter performance. Maybe Glen, just to start off, like, in the big picture front, you talked about the macro environment improving and the strong fourth quarter supports that idea, that notion. Just help us understand what's changed, what you're able to do now, that you weren't able to do obviously or were challenged by over the last year or so, and you know, why you're confident or why you're feeling good that that macro environment improvement is gonna set you up well, to have another good year in 23. Thanks, Rick. Appreciate the question. The thing that's changed, I mean, just thinking about 2022, we started the year with significant headwinds, with COVID basically hitting all of our markets, essentially all at the same time, plus or minus a week or two. That had a significant negative impact. Outside the United States, our ability to rebound from that was slower than what we had experienced in the United States. That, I think has really fully cleared for us as we, you know, progressed across the year, albeit at different rates in different parts of the world. That's cleared a bit. The other thing is that we had some real staffing challenges. We talked about those in the last call. Some of those were related to just sort of normalization and getting people back into their seats. Some of those, as we talked about in the third quarter, were related to extraordinary opportunities for folks to take time after the better part of three years not being able to take a vacation. We, we felt that in the third quarter. We don't anticipate extraordinary types of impact as we look ahead in that regard. Finally, one of the things that was revealed to us that we talked about in the last quarter call, when we had, particularly in the United States, about six months without COVID, which was the first time ever that we weren't getting knocked around in one place or another, we were able to identify, where we really stood with our accounts as opposed to you know, and in some cases, I think we were maybe assuming or hearing that COVID was the problem, and in fact, the account hadn't made the procedure, quite as routine as a part of their offering as is appropriate in our high-performing accounts. As we talked about in the last call, we were able to set up a process whereby we classified all of our accounts and then set specific goals for moving them into the direction of being better established and as a consequence, being able to execute our procedure more routinely and more efficiently. Those are all things that I think put us coming into this year into a better place, whether that be with the plan or just without the headwinds that we had faced, particularly in the first part of last year. Gotcha. On your account productivity, obviously, you know, you're doing well. If I, if I wrote it down correctly, and I think I am saying it correctly, 45 cases a quarter on average. Did I hear you correctly that the average for all accounts was 4.8 in the fourth quarter, or was that your top performing? Anyway, maybe you'll clarify that, but as we think about 2023, can we get into the five-six range? Maybe talk about your training and your efforts to support drive better account productivity that could get you there, if that's the right way to think about it. Well, we had across the year, across 2022, the first quarter, our account productivity number was 3.9. We started below four in the first quarter. We were in the mid-range in sort of the 4.5 range in the second two quarters, and we exited the year at 4.8. Yes, we were in the four to five range across the year. It is our expectation that we will be exiting this year in the five to six range, as you talked about. We'll do this through executing on the plans that we had talked about before. Training is central to that. Ensuring whether that be on-site training in terms of sharing best practices to ensure that the centers themselves are able to efficiently move patients from the sort of the front door to the procedure, and in doing so, decrease the time that it takes, which is a very sensitive variable in sort of our productivity equation, if you will. Also the training itself. I think we may have talked, maybe not on one of these calls, but we have modified the way that we bring folks into training. I would say that relative to where we were a couple of years ago, the physicians that are coming in to training are much more committed and much more engaged. We ask them to bring forward the data and information and scans on three patients that are talked about prior to training. They then immediately come out of face-to-face training. You may recall that in COVID times, we were doing virtual training, which is not nearly as good as having somebody face-to-face for a day, going with a world expert at the front of the room, going through all the various aspects of the procedure and standing in a procedure room for one, two or three procedures. We ask those physicians to immediately go back and to execute three procedures, which are then reviewed by experts along with them to assess, you know, what do the scans look like, what are the, and how is that patient doing in terms of volume reduction and other metrics. Those conversations are very, very valuable in bringing those physicians up to speed, getting them doing the procedure quickly. In sort of the COVID days, they'd come out of training and they'd start looking for patients, and then a wave of COVID would knock them off balance, and it could be 9 months before they treated their first patient. We're getting folks engaged much more quickly, and that's essentially the backdrop for how we intend to drive this forward. Rick Wise, this is Derrick Sung. Let me just clarify the definition that we're using for account productivity. It takes a few quarters for an account to get up to speed, when, from when they do their first case. When we look at and measure our account productivity, we're looking at accounts that have been up and running for at least three quarters. They're in their fourth quarter of implanting our Zephyr Valve. We're also looking at only those accounts that have actually done a case in that given quarter. Our number isn't diluted by, you know, inactive accounts. The numbers that Glen gave, sort of in the four to five range of established active account productivity, refer to those accounts that have been up and running for at least three quarters, are active in a given quarter, and we do indeed expect those, that number to move up through the back half of the year and into that five to six range as we exit the year. Gotcha. Just, Derrick, last from me, if I could you expand on your gross margin comments? Gross margins were a little lighter than I looked for, and your guidance is a little lighter, and yet you had record volumes. Maybe I missed it. Can you a little more color on why gross margins are a little lower than they were earlier in the year, and ditto for the look ahead to 23. Thank you. Sure, Rick. That slight reduction in gross margin that we're seeing in the fourth quarter of last year, and as we look into the first half of this coming year in 2023, reflects a slightly lower capacity utilization or production output as we feel like we're now kind of where we wanna be in terms of inventory levels and safety stock, given our current outlook for demand in the near term. We're expecting to stay around that 73% range in that first half of the year. As in the back half of the year and into next year, as we start once again ramping up our production output, into next year and beyond, we expect to move up to kind of that 74% range. We continue to believe that, and expect that our gross margins will continue to move up as we ramp our production output, to meet demand and, will land over the long term in that high- 70 ranges as we reach scale. Thank you so much, Derrick. Absolutely. Okay, thank you. Please stand by while we wait up for our next caller. Okay. Our next question comes from the line of Bill Plovanic of Canaccord. Your line is now open. Hey, Glen, Derrick, it's John on for Bill tonight. Thanks for taking our questions. Can you talk a little bit more on the number of accounts that are efficient today with the patient flow process? In the past, you've highlighted 40-50 accounts that do this well. Where does that number stand today? Can you just give us a little more details on how you're gonna help with those struggling accounts? Are you gonna hire more reps this year or just how you gonna work through the workflow processes? Thanks. Derrick, I don't know if you heard all of that. It was a little choppy for me. Did you get that whole question? Yeah. John, you're asking, what percentage, you know, so what percentage of our accounts are kind of where we want them to be and how are we going to, I think, focus on driving, you know, those accounts that are not as high volume as we'd like, to get to where- Yeah, sorry. they wanna be. Okay. Right. Yeah, sorry. If that's to paraphrase your question. You know, I, I would start by saying, you know, I think, you know, today, I would say approximately, you know, exiting the year, you know, roughly speaking, maybe a quarter of our accounts are really doing kind of well and doing where we want them to be. They're, they're what we would consider to be high volume accounts. There's certainly, you know, an additional group of accounts that we feel can get into that range that we're really focused on. What we're focused on is exactly kind of what Glen had mentioned, which was during his prepared remarks, which is, you know, driving site, efficiency, making this product or this procedure routine. It, it's a new procedure that we're setting up and a new service line that we're setting up in these hospitals. Coordinating across multidisciplinary functions at driving the training, and really the focus and mind share to get our physicians in those hospitals to adopt our procedure as a routine procedure is really kind of what we are focused on. That's really kind of the site efficiency efforts that we're gonna be driving through the first half of this year. We expect to be able to do that with our existing sales force. This isn't gonna require, and we're not anticipating, a significant increase in our sales force through 2023, which I believe was the second part of your question. It's really just a focus of driving kind of that efficiency and mind share and making this procedure routine amongst those hospitals that we've already opened. Thanks, Derrick. If you could hear this question too, just on Japan and the launch preparation, what's the team size there today, and what infrastructure do you still need to add to be ready for launch end of this year? Thanks for taking our questions. Sure, absolutely. We're in pretty good shape, I think, as far as Japan goes. We have a general manager in place who joined us, senior executive at Medtronic has joined us, been leading the way, been on board for about six months. We have a marketing person, sort of a clinical marketing type person. I think we've extended a couple offers to a couple sales representatives to begin to get those accounts where they need to be. We've been leveraging significantly deeply experienced consultants from a regulatory and clinical perspective. We're gonna have to do a post-approval clinical trial. We've got our own personnel that have been traveling through their identified partners that we'll be working with. We're frankly in very good shape, as it relates to, both the number and sort of, functional expertise of the folks that we have or are just about bringing on at this point. Thanks. Thank you. Please stand by for our next caller, or next question. Our next question comes from the line of Travis Steed of BofA Securitie s. Your line is now open. Hi, this is Ian on for Travis. Just hoping to get a bit more detail on the guide here, if possible. What does the $63 million-$65 million imply for US versus OUS? I think you had previously said 25% growth U.S., 15% OUS. Looks like U.S. was a little faster in Q4, OUS a little slower. Any additional detail around expectations for Q1 here, given that almost through February last year had the COVID impact. I think the Street's at around $13.5 million. Is that in the right ballpark for Q1 here? Hi, Ian, this is Derrick. I'll go ahead and take those questions. In terms of, you know, the implications for growth rates relative to our sales guidance, our sales guidance of $63 million-$65 million does imply kind of roughly, you know, at the midpoint, 20%-ish growth on a year-over-year basis over 2022, which is sort of the same that we communicated at the end of last year as we're kind of giving our high level directional guidance. If we think about the breakdown between the U.S. and OUS, I think we'll continue to remain in that 60-40 mix with, you know, about 60% of our business coming from the U.S., 40% coming from international. We do expect the US to grow meaningfully faster than international. You know, the U.S., you know, I think will grow in that 25%-30% range, whereas, you know, outside the U.S., you know, we're looking at something in the 15%-20% range. That is, I think that answers the first part of your question. Can you repeat the second part of your question? Yeah, just any additional detail around Q1. I think the street's. Right $thirteen and a half million. Right. We do expect to see sort of typical sequential seasonality in Q1. Historically, we've seen that Q1 sales are anywhere from, you know, 10%-15% lower on a sequential basis than Q4. That's typically driven by outside the U.S. We see hospitals oftentimes using up their budgets near the end of the year. Globally, including the U.S., you know, there's generally a gradual ramp-up as folks come off the holidays in the beginning of the year. Now that seasonality was more pronounced during COVID, if we look back into the kind of the pre-COVID time period, we do typically see that sort of sequential decline. I would expect to see something in that range, that historical range, again in Q1. I would expect to see international reflect more of that seasonality than the U.S. I think both will see a level of sequential decline as we've typically seen in the past. Okay. Perfect. Maybe one on international. Just Japan, any early expectations around revenue numbers later this year? How fast could that potentially ramp next year? In terms of China, just how large of a business is that for you? Any expectations around a rebound there this year? Yeah. With regard to Japan, we anticipate that we're going to get approval or reimbursement later, you know, later part of the year. I think it takes some time to get things up and running. I don't expect that the day after we get approval, we're gonna be treating our first patient. We'll get a handful of patients in this year, I think, if we're doing well. I don't expect any material contribution this year to revenues by Japan. The other thing is we anticipate that the first 100-150 patients in Japan are likely to have to all run through a clinical trial. We'll probably be opening up Japan through five or 10 specific centers. I expect that though revenues in the next year will be way stronger than they are this year, I don't anticipate that those are gonna knock the doors off of. They're not gonna bend the curve dramatically in terms of our OUS revenues. I see revenues really taking off in 2025 when we've had an opportunity to enroll those first patients into the study and expand our footprint and move off of that. I think that's the way that I would think about getting into that opportunity. Over time, we see that as being probably our, you know, certainly a top five market for us. I think the second part of your question was around China. China is, you know, less than $1 million in revenue for us right now. Okay. Thanks for taking the question. Please stand by for our next question. Our next question comes from the line of Jason Bednar of Piper Sandler. Your line is now open. Hey, excuse me, good afternoon. Thanks for taking the questions here. Glen or Derrick, you know, I, the number of new accounts you're looking to onboard this year is, you know, maybe below, a little bit below what we've seen in past years. I think that's probably partly a function of maybe where you're at in onboarding a lot of your target accounts. As your reps refocus their efforts towards driving account productivity, I think this makes a ton of sense. You know, what does the give and take look like here as the emphasis shifts? Are you expecting return on time for your reps to be higher in focusing on turning on existing accounts versus being more productive with your existing accounts? Maybe could you help us with, like, what the lower new account additions means in terms of, you know, the shift in how your reps spend their time during the day? Yeah, adding new accounts has never really been central to what we're asking the reps to do. It's been fairly organic in terms of the opening of new accounts. I think the thing that is new is that what we've shared with the sales organization is that we need to get these accounts to a point that where they're doing this procedure much more routinely. What you see from the revenue numbers of those accounts that have gotten to that place where they're exercising much more routinely and efficiently, is that the revenues follow, and it's fairly dramatic. Everybody's on the same page here. We're not telling folks not to open new accounts. They're gonna continue to do that opportunistically. The real opportunity here for us, as we are now, you know, sort of moved past halfway penetrated into the hospitals that we're targeting in the United States, is really around same store sales. That's what we're focused on. That's everyone's on the same page. We're not forcing anybody to do anything. We're trying to make this technology available to the greatest number of people possible. That's the path that makes the most sense to everyone. That's where folks are focused at this time. Okay. Great. That's helpful. Then maybe could you talk about the trends you're seeing in Europe, you know, notably Germany and France, which, you know, account for a disproportionate part of your international franchise? It sounds like there's still maybe some capacity constraints in those markets. Do you see those markets maybe accelerating throughout 2023, almost mimicking the U.S. but on a lagged basis? Are there other effects in Germany and France in particular we should have in mind, that maybe even make that more of a 2024 recovery dynamic? Thank you. Yeah. Well, the three, our big three international countries are Germany, France, and the U.K. Together they represent 2/3 of our international business. The U.K. in some ways is leading the way on a global basis with regard to the execution of the strategy that we're talking about employing in the United States. I mean, they've been doing this for a while. They grew 31% last year year-over-year. We anticipate that they're gonna do great, and they're gonna continue to grow at a high rate as we look into the year. France had after a sort of an initial adoption curve that was very much consistent with the slope of the upward slope of the U.S. adoption, had a remarkably soft year last year. We expect them to get back on that sort of steeper curve. I'm expecting really good things out of France this year, and I wouldn't be surprised if France is nipping at Germany's heels to be the number 1 market outside the United States for us, perhaps by the end of this year. As far as Germany goes, we're executing on the fundamentals like we are everywhere else. We've got good marketing activity, good commercial or sales activity. We're executing the same sort of game plan that we are in other markets, and we expect them to grow as well. If I had to predict the amount of growth on a percentage basis, I'd probably put the UK and France ahead of Germany, but I expect all three to make significant contributions across the year. Thank you. Thank you. I would now like to turn it back to Glen French for closing remarks. I thank you everybody for your questions. They're much appreciated. We remain very confident in the opportunity as well as our ability to access it. This opportunity is clearly large. The patients are there. They're seeking information on the procedure. They're seeking access to the procedure. We feel like we've got a great plan that we're executing on. It's very clear. Our data are strong, they're consistent, they're compelling. We're included in the global guidelines, reimbursements sorted out in all of our major markets. Our treating doctors view our reversible procedure as the standard of care in collateral ventilation negative patients. These are the folks that are doing the procedures. We are working to expand our total addressable market through both geographic expansion into Japan, as well as expanding our indication that we're working on with AeriSeal and enabling us to treat with Zephyr Valve, a large population of severe emphysema patients who are today not candidates for the procedure. In short, we remain very optimistic about the future. We appreciate everyone's interest. I think unless people have any additional questions, I think that we've gotten to the end of the call. Okay. Well, thank you for your participation in today's conference. This does conclude the program. You may now disconnect.