BrainsWay, the Israeli medical device company specializing in Deep Transcranial Magnetic Stimulation (Deep TMS) for mental health disorders, released their Q1 2024 earnings, painting a picture of continued growth and profitability. The headline numbers were impressive: 37% year-over-year revenue growth, positive net income for the second consecutive quarter, and a robust pipeline suggesting sustained momentum. But beneath the surface, a subtle yet significant shift has occurred, one that could signal a surge in demand far exceeding current analyst projections.

The key lies in BrainsWay's strategic focus on large institutional and enterprise customers. While this has been a stated strategy for some time, the Q1 transcript reveals a tangible acceleration. Hadar Levy, BrainsWay's CEO, emphasized the "increasingly important role" these large entities are playing, highlighting a recent deal with Katie's Way Plus, a mental health provider specializing in services for military members, veterans, and their families. Katie's Way Plus expanded their Deep TMS network significantly, ordering 18 additional systems, bringing their total to approximately 40.

This is more than just a single large order. It speaks to a broader trend: large mental health groups are embracing Deep TMS as a core component of their treatment offerings. They're not just dipping their toes in the water anymore, they're building entire treatment networks around this technology.

Why is this so significant? It signals a shift in the industry's perception of Deep TMS. Early adopters were often individual psychiatrists, driven by clinical interest and a desire to offer innovative solutions. But the entry of large groups signifies a validation of the technology's efficacy and economic viability on a much larger scale.

Here's where the hypothesis gets truly intriguing. Currently, BrainsWay estimates adding 50-60 systems to its installed base each quarter, leading to roughly 1,350-1,400 systems by year-end. But what if this influx of institutional adoption throws those calculations out the window? What if Katie's Way Plus is just the first wave, with other large groups poised to follow suit?

Consider this: the mental health market is vast and underserved. Traditional treatments often fall short, leaving patients searching for alternatives. Deep TMS offers a compelling solution: it's non-invasive, has minimal side effects, and boasts strong evidence of efficacy for conditions like major depressive disorder and OCD. If a few Katie's Way-sized players across the US each adopt even half of Katie's Way's system count, the impact on BrainsWay's growth could be explosive.

Potential Growth in Deep TMS Systems Installed

The chart below shows BrainsWay's projected system installations based on current estimates (50-60 systems per quarter) and a hypothetical scenario with accelerated institutional adoption (100-200 systems per quarter).

Imagine a scenario where, instead of 50-60 systems, BrainsWay starts placing 100, 150, or even 200 systems per quarter. Suddenly, the current $37-$40 million revenue guidance begins to look conservative. Such a surge in demand would not only accelerate revenue growth but it would also dramatically leverage BrainsWay's already impressive profitability and cash flow generation.

Of course, this is just a hypothesis, but the signals are there. BrainsWay is perfectly positioned to ride this potential wave of institutional adoption. They have a strong balance sheet, a proven technology, and a commercial strategy aligned with the evolving market dynamics. If the Katie's Way Plus deal is any indication, a tsunami of demand may be on the horizon, leaving analysts scrambling to revise their projections upwards.

"Fun Facts About BrainsWay: * Did you know that BrainsWay's technology was initially inspired by research into treating Parkinson's disease? [Learn more about BrainsWay's history](https://www.brainsway.com/us/about/) * The company's name, BrainsWay, is a clever play on words, suggesting a path to improve brain health. * BrainsWay's Deep TMS technology has been used to treat patients in over 20 countries around the world. [Explore BrainsWay's global reach](https://www.brainsway.com/global/)"

These facts highlight the company's commitment to innovation, global reach, and dedication to finding solutions for complex brain disorders. As they continue to expand their footprint and drive adoption of Deep TMS, BrainsWay might just be at the forefront of a revolution in mental health care.