8-K: Butterfly Network Reports 20% Revenue Growth in Q1 2025, Reaffirms Full-Year Guidance

Butterfly Network announces a 20% year-over-year revenue increase in Q1 2025, driven by strong U.S. sales and higher iQ3 probe prices, while reaffirming its full-year revenue and adjusted EBITDA guidance.

Summary

• Butterfly Network reported its financial results for the first quarter ended March 31, 2025.
• The company achieved revenue of $21.2 million, a 20% increase compared to $17.7 million in the first quarter of 2024.
• U.S. revenue grew by 24% to $16.6 million, fueled by higher sales volume, the impact of the iQ3 probe's higher selling price, and semiconductor chip deliveries.
• International revenue increased by 9% to $4.6 million, driven by the higher selling price of the iQ3 probe in new international markets.
• Gross profit increased to $13.4 million from $10.3 million, with gross margin improving to 63.0% from 58.2%.
• Net loss decreased by 36% to $14.0 million from $21.8 million in the prior year period.
• Adjusted EBITDA loss was reduced to $9.1 million from $13.2 million.
• The company raised $81.7 million in net proceeds through a public offering completed on January 31, 2025.
• Butterfly Network reiterated its full-year 2025 revenue guidance of $96 million to $100 million, representing approximately 20% growth.
• The company also reaffirmed its adjusted EBITDA loss guidance of $37 million to $42 million for the full year 2025.
• Cash and cash equivalents stood at $155.2 million as of March 31, 2025.

Sentiment

Score: 8

Explanation: The document presents a positive outlook with strong revenue growth, improved margins, and successful capital raising. The management's comments are optimistic, and the company is making progress on its strategic initiatives.

Positives

• Revenue increased by 20% year-over-year, indicating strong growth.
• Gross margin improved significantly, reflecting higher average selling prices and software margins.
• Net loss and adjusted EBITDA loss were reduced, demonstrating improved financial performance.
• Successful capital raise strengthens the company's balance sheet and supports innovation.
• The Butterfly HomeCare pilot program shows promising results in reducing rehospitalizations for heart failure patients.
• Medical education momentum continues with additional schools committing to student device programs.
• The company's iQ3 ultrasound device was featured in the HBO Max medical drama 'The Pitt', highlighting its growing adoption.

Negatives

• The company is still operating at a net loss of $14.0 million.
• The company is still operating at an adjusted EBITDA loss of $9.1 million.

Risks

• The company's ability to achieve its revenue and adjusted EBITDA guidance depends on various factors, including market acceptance of its products and services.
• Competition from other companies in the medical imaging market could impact Butterfly Network's growth.
• Changes in healthcare regulations and reimbursement policies could affect the adoption of Butterfly Network's products.
• The company's reliance on third-party manufacturers and suppliers could create supply chain risks.

Future Outlook

Butterfly Network reiterates its full-year 2025 revenue guidance of $96 million to $100 million, representing approximately 20% growth, and adjusted EBITDA loss guidance of $37 million to $42 million.

Management Comments

• Joseph DeVivo, Butterfly's President, Chief Executive Officer and Chairman commented, 2025 is off to a great start.
• The Butterfly team hit the mark again, delivering right on target with a 20% growth quarter.
• Were very proud of how the Company continues to mature.
• As we move through the second year of our five-year strategic plan, we are beginning to see the benefits of our multi-pronged growth strategy take shape furthering our resilience and enabling us to deliver consistent and meaningful results.
• Our results highlight the strength of our opportunities in medical education and enterprise adoption, while marking continued progress across our strategic initiatives, Octiv and Butterfly HomeCare.
• With multiple avenues for growth and a team built to execute, were well-positioned to deliver on the guidance we committed, while continuing to advance innovation and uphold our technology leadership.

Industry Context

Butterfly Network's focus on portable, semiconductor-based ultrasound technology aligns with the broader trend of digital health and point-of-care diagnostics. The company's growth in medical education and enterprise adoption reflects the increasing demand for accessible and affordable medical imaging solutions.

Comparison to Industry Standards

• Comparable companies in the point-of-care ultrasound market include GE Healthcare, Philips, and Siemens Healthineers.
• Butterfly Network's 20% revenue growth in Q1 2025 is competitive compared to the growth rates of larger, more established players in the industry.
• The company's focus on innovation, as evidenced by the iQ3 and AI-powered applications, positions it well for future growth in the rapidly evolving digital health landscape.
• The Butterfly HomeCare pilot program addresses the critical need for reducing rehospitalizations, a key focus area for healthcare providers and payers.

Stakeholder Impact

• Shareholders: The positive financial results and reaffirmed guidance are likely to be viewed favorably by shareholders.
• Employees: The company's growth and success can lead to increased job security and opportunities for advancement.
• Customers: Healthcare practitioners and patients benefit from the availability of affordable and accessible medical imaging solutions.
• Suppliers: The company's growth can lead to increased demand for their products and services.
• Creditors: The company's strong financial position reduces the risk of default on its obligations.

Next Steps

• Continue clinical execution of the Butterfly HomeCare congestive heart failure pilot program.
• Expand medical education programs with additional school commitments.
• Advance AI development partnerships within the Butterfly Garden.
• Focus on mainstream medical adoption of Butterfly iQ3.

Key Dates

Keywords

Butterfly Network, ultrasound, medical imaging, financial results, revenue, EBITDA, iQ3, digital health, healthcare, growth