10-Q: Butterfly Network Reports Q1 2025 Results, Revenue Up 20.2% Driven by Strong Product Sales

Sentiment:

Quarterly Report 2 May 2025 7:28 AM

Butterfly Network's Q1 2025 revenue increased by 20.2% year-over-year, driven by higher product sales and growth in software and services revenue.

Better than expectedThe company's revenue increased by 20.2% year-over-year, indicating growth in the business.The company's net loss decreased from $21.761 million to $13.967 million, showing improved financial performance.

Summary

Butterfly Network, Inc. reported its financial results for the first quarter of 2025.
Total revenue for Q1 2025 was $21.225 million, a 20.2% increase compared to $17.656 million in Q1 2024.
Product revenue increased by 25.4% to $14.164 million, driven by higher sales volume in the US and the impact of the iQ3 probe's higher selling price.
Software and other services revenue increased by 10.9% to $7.061 million, driven by higher enterprise software revenue and increased licensing and services revenue from partnerships.
The company's net loss for Q1 2025 was $13.967 million, compared to a net loss of $21.761 million in Q1 2024.
Units fulfilled increased by 10.9% to 4,738 units in Q1 2025.
The company completed a public offering of 27.6 million shares of Class A common stock on January 31, 2025, generating net proceeds of $81.1 million.
As of March 31, 2025, Butterfly Network had cash and cash equivalents of $155.2 million.

Sentiment

Score: 7

Explanation: The report shows positive revenue growth and a reduced net loss, which is encouraging. However, the company is still operating at a loss and faces ongoing litigation risks, tempering the overall sentiment.

Positives

Revenue increased by 20.2% year-over-year, indicating growth in the business.
Product revenue increased by 25.4%, driven by higher sales volume and the iQ3 probe.
Software and other services revenue increased by 10.9%, driven by enterprise software and partnerships.
Net loss decreased from $21.761 million to $13.967 million, showing improved financial performance.
The successful public offering generated $81.1 million in net proceeds, strengthening the company's balance sheet.

Negatives

The company still reported a net loss of $13.967 million for the quarter.
Software and other services mix decreased by 2.8 percentage points, to 33.3%.

Risks

The company is involved in ongoing litigation, including a putative class action lawsuit and stockholder derivative actions, which could result in significant costs and liabilities.
The company's future performance is subject to various risks and uncertainties, including those described in the 2024 Annual Report on Form 10-K.

Future Outlook

The company expects to continue to invest in its business to grow revenue and believes that its existing cash and cash flows from operations will be sufficient to meet its liquidity, capital expenditure, and anticipated working capital requirements and fund its operations for at least the next 12 months.

Management Comments

Since 2022, we have taken significant actions to reduce our cost of operations and extend our cash runway and have reduced our annual cash requirements by approximately $180 million, to less than $50 million annually.
As we look forward, we expect to continue to invest in our business in order to grow revenue.

Industry Context

Butterfly Network operates in the digital health and medical imaging industry, competing with companies that market ultrasound imaging devices. The company's focus on portable, semiconductor-based ultrasound technology and cloud-connected software differentiates it from traditional ultrasound systems.

Comparison to Industry Standards

It's difficult to directly compare Butterfly Network's results to industry standards without specific competitor data for Q1 2025.
However, companies like Philips, GE Healthcare, and Siemens Healthineers are major players in the broader medical imaging market, and their performance can provide some context.
Butterfly's growth rate and focus on point-of-care ultrasound may be compared to smaller, more specialized companies in the handheld ultrasound space.

Legal Proceedings

On February 16, 2022, a putative class action lawsuit, styled Rose v. Butterfly Network, Inc., et al. was filed in the United States District Court for the District of New Jersey.
On June 21, 2022, a stockholder derivative action, styled Koenig v. Todd M. Fruchterman, et al. was filed in the United States District Court for the District of Delaware against the Companys board of directors and the Company as nominal defendant.
On November 28, 2023, a stockholder derivative action, styled Bhavsar v. Todd M. Fruchterman, et al. was filed in the United States District Court for the District of Delaware against the board of directors and the Company as nominal defendant.

Stakeholder Impact

Shareholders: The increased revenue and reduced net loss are positive signs for shareholders.
Employees: The company's continued investment in its business could lead to job growth and opportunities for employees.
Customers: The company's focus on innovation and accessibility could benefit customers by providing more affordable and convenient medical imaging solutions.

Key Dates

Date	Description
February 4, 2020	Butterfly Network, Inc. was incorporated in Delaware.
November 27, 2020	Proxy/Registration Statement filed with the SEC.
January 12, 2021	Start date of alleged class action lawsuit period.
November 15, 2021	End date of alleged class action lawsuit period.
February 16, 2022	Rose v. Butterfly Network, Inc., et al. was filed.
June 21, 2022	Koenig v. Todd M. Fruchterman, et al. was filed.
November 28, 2023	Bhavsar v. Todd M. Fruchterman, et al. was filed.
December 31, 2024	Date of audited consolidated financial statements used for comparison.
January 1, 2025	The number of shares reserved for issuance was increased automatically by 4% of the number of outstanding shares of common stock as of January 1, 2025.
January 31, 2025	The Company issued and sold 27,600,000 shares of its Class A common stock in a public offering at a price of $3.15 per share.
March 5, 2025	Entities owned by trusts created for the benefit of the children of Dr. Jonathan Rothberg, a member of our board of directors, adopted a Rule 10b5-1 trading arrangement.
March 31, 2025	End of the quarterly period.
April 21, 2025	Date as of which the registrant had 220,861,993 shares of Class A common stock outstanding and 26,426,937 shares of Class B common stock outstanding.
May 2, 2025	Date of report signature.
July 7, 2025	Beginning of the period during which entities owned by trusts created for the benefit of the children of Dr. Jonathan Rothberg, a member of our board of directors, have authorized the sale of up to 6,202,545 shares of our Class A common stock.
July 3, 2026	End of the period during which entities owned by trusts created for the benefit of the children of Dr. Jonathan Rothberg, a member of our board of directors, have authorized the sale of up to 6,202,545 shares of our Class A common stock.

Keywords

revenue, Butterfly Network, financial results, ultrasound, iQ3 probe, software, net loss, stock offering

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