Business Overview / Sources of Revenue

BrainsWay (BWAY) is a **medical device company** focused on noninvasive neuromodulation systems using proprietary deep transcranial magnetic stimulation (**Deep TMS**) to treat mental health and neurological disorders such as major depressive disorder and obsessive-compulsive disorder.[1][2][3]

The company operates a **“razor-and-blade” model**: it sells or leases Deep TMS systems to psychiatrists, clinics, and hospitals, then generates recurring revenue from treatment helmet usage (per‑use/session fees or prepaid treatment plans).[4]

BrainsWay earns revenue primarily from:
- **Systems and accessories** (capital equipment sales/leases of Deep TMS devices).
- **Recurring treatment revenues** tied to procedure volume (the main long‑term driver).[4]

Geographically, about **81% of revenue comes from the United States** and roughly **19% from other regions** based on recent fiscal-year data.[1]

Revenue Growth Potential and Recurrence

BrainsWay already has a **large and growing recurring revenue base**, driven by multi‑year leases and per‑treatment usage. Around **70% of new customer engagements are multi‑year lease agreements**, and remaining performance obligations of about **$60–65M** indicate high visibility and durability of revenue streams.[2][1] Recurring revenue is growing faster than non‑recurring (about **+34% YoY vs. +23%**), and management is explicitly shifting toward a **high‑margin ARR model**.[1]

From FY2020–2024, revenue grew at roughly a **~17% CAGR**, despite a down year in 2022.[3] Independent models project a **10% base‑case growth in 2025**, and a **~15% revenue CAGR through 2027**, with longer‑term (5–10 years) potential in the **low‑ to mid‑teens CAGR** range, contingent on broader reimbursement and new indications.[3][2]

Economic Moat Factors

BrainsWay’s **economic moat is modest and specialized, not broad or unassailable**.

Key advantages:
- **Unique assets/technology**: Proprietary **H‑coil Deep TMS** design and multiple **FDA clearances** for indications like depression, OCD, and smoking addiction support some differentiation and regulatory barriers.[1][2][4]
- **Clinical data & know‑how**: Extensive trial base, treatment protocols, and installed base in psychiatry clinics create implicit **switching frictions** for physicians and institutions.[1][3]
- **Regulatory and reimbursement hurdles** in neurostimulation slow new entrants, adding a light barrier.

Weaknesses:
- **Limited network effects**: Usage at one clinic does not strongly increase value for others.
- **Scale and brand**: As a small med‑device company, BrainsWay lacks the **scale and brand power** of larger device or pharma competitors.[2][3]
- Competing TMS systems and alternative treatments keep pricing and returns under pressure.

Leadership

BrainsWay’s CEO is **Hadar Levy**, not a founder; the company was founded in 2003, and he joined leadership in 2014.[1][3] He was appointed CEO in February 2023, so has been in the role for about 3 years.[3][6] Public filings and company materials do not disclose a significant founding-type equity stake for him; any holdings appear to be those of a professional manager rather than a founder. The broader team includes a CFO, CTO, CMO, and other VPs, indicating a relatively standard, professionally managed leadership structure.[1]

Financial Health

BrainsWay has a **strong net cash position** and an overall **conservative balance sheet**, with assets and equity far exceeding liabilities and no material financial debt reported in recent filings.[1] Operating cash flow has been **consistently positive** over the last four quarters, implying **positive free cash flow**, given modest capex.[1] That suggests a **solid, improving FCF margin**, though still in the single to low‑double digits on recent revenue levels.[1] Share count has **inched up over time**, indicating **modest dilution rather than net share repurchases** in recent years.[1][4]

Last updated Jan 11, 2026