Company to host conference call and webcast at 8:30 a.m. Eastern Time NEW YORK, Aug. 5, 2025 /PRNewswire/ -- DarioHealth Corp. (Nasdaq: DRIO) ("Dario" or the "Company"), a leader in the global digital health market, announced today that it will release its financial results for the 2nd quarter ended June 30th, 2025 and will host a conference call and webcast at 8:30 a.m. Eastern Time, on Tuesday, August 12th, 2025, before the market opens. Erez Raphael, Chief Executive Officer, Steven Nelson, President and ...

Core Viewpoint - DarioHealth Corp. and GreenKey Health have formed a strategic partnership to address the $150 billion sleep apnea market, which affects over 29 million Americans, by providing an integrated chronic care solution that combines behavioral health, sleep, and cardiometabolic care [1][4]. Group 1: Collaboration Details - The collaboration combines Dario's AI-powered health solutions with GreenKey's sleep-first approach to obstructive sleep apnea management [2]. - The immediate focus is on engaging large payers and building a national network of service providers through targeted outreach and thought leadership [3]. - The partnership aims to secure payer contracts and enhance awareness through a multi-channel marketing plan targeting various healthcare plans and self-funded employers [2][3]. Group 2: Market Opportunity - The sleep apnea market is significant, with up to 80% of moderate to severe cases undiagnosed, leading to over $150 billion in annual costs due to related health issues [4]. - There is a growing demand for integrated solutions as payers shift towards value-based care, which the collaboration aims to fulfill [4]. Group 3: Expected Outcomes - The joint solution is designed to improve member health outcomes, reduce healthcare costs, and increase productivity through better sleep health and effective comorbidity management [6]. - The collaboration is expected to provide actionable data insights to continuously optimize program performance [6]. - By aligning behavioral health and sleep strategies with cardiometabolic interventions, the partnership offers a comprehensive approach to chronic care management [5].

Company Overview and Investment Thesis - DarioHealth Corp offers a comprehensive and unified product offering, covering 6 conditions with navigation technology[9] - The company leverages massive data assets, having invested in understanding and evaluating over 13 billion user data points[9] - The company operates in a fast-growing industry with over $170 billion market opportunity[9] - The company provides significant value to payers, with a concrete 5X ROI (over $5,000 ROI per user from 89 studies)[10] Market and Solution - Chronic diseases account for 75% of aggregate US healthcare spending[12] - 60% of adults in the US have a chronic disease, and 40% have two or more[12] - The company's solution supports member needs across multiple conditions on one integrated digital platform[17] Growth and Financial Performance - The company's B2B revenue growth exceeds 6x with 85+ customers added since 2020[10] - The company's B2B2C revenue trajectory has grown significantly, reaching $21.8 million in 2024 Q3 RR[35] - The company is executing a faster path to profitability, targeting 2H 2025, one year faster than the original target[65] - The company has achieved significant synergies post-Twill acquisition, with a 111% increase in revenue and a 23% reduction in operating loss in Q3 2024 (GAAP)[67]

Core Insights - DarioHealth Corp. has presented new research demonstrating sustained outcomes for GLP-1 users and an 89% accuracy in AI-driven blood glucose predictions, indicating the company's strong position in the digital health market [1][2][6] Group 1: Research Findings - A significant reduction in eA1c levels from 9.0% to 6.7% was observed in GLP-1 users, with sustained results for six months post-medication discontinuation [2][8] - Users of Dario's platform maintained stable outcomes without significant weight or glucose rebound after stopping GLP-1 medication, addressing a critical challenge in chronic condition management [4][8] - The studies highlight the importance of integrated digital tools in enhancing medication adherence and optimizing health outcomes [5][6] Group 2: AI and Personalization - Dario's AI research achieved an 89% accuracy in predicting future blood glucose levels, utilizing user behavior and activity data [7][10] - The company's next-generation AI platform aims to provide personalized interventions based on real-time behaviors and clinical data, enhancing chronic condition management [6][9] - Age was identified as a significant factor influencing outcomes, with older adults showing stronger results through increased engagement in lifestyle activities [14] Group 3: Commercial Strategy - Dario is actively leveraging its research findings in discussions with payers and self-insured employers to offer integrated solutions for chronic condition management, particularly in GLP-1 optimization [3][10] - The company believes its platform can maximize return on investment for health plans and employers implementing GLP-1 programs, thereby enhancing commercial value [6][10]

Financial Data and Key Metrics Changes - In Q1 2025, the company reported revenue of $6.75 million, a 17% increase year-over-year driven by recurring revenue growth from B2B2C channels [10] - Non-GAAP gross margins improved to 70.5%, up from 62.4% in Q1 2024, while core B2B2C business maintained gross margins above 81% for four consecutive quarters [12][35] - Non-GAAP operating loss decreased from $9.1 million to $5.8 million year-over-year, representing a 36% reduction [13] Business Line Data and Key Metrics Changes - The company signed 14 new clients in Q1 2025, including one national health plan, one regional health plan, and 12 employers, increasing the total client base to 97 from 83 at the end of 2024 [12][19] - Over 80% of new contracts are multi-condition, with an average contract length of three years and a renewal rate above 90% [12][19] Market Data and Key Metrics Changes - The market is shifting towards whole person digital health and platform consolidation, with employers and health plans seeking trusted partners for multi-condition care [8][20] - The company is actively engaged with multiple national and regional payers, with discussions ongoing for high-value long-term contracts [25] Company Strategy and Development Direction - The company is focused on executing a strategy centered on platform differentiation, client quality, and commercial scalability [11] - The integration of Twilio has strengthened the company's position, allowing it to support five chronic conditions under a unified brand [7][8] - The company aims to achieve operational cash flow breakeven by the end of 2025, supported by existing account extensions and new contracts [17][36] Management's Comments on Operating Environment and Future Outlook - Management noted a broader reset in the digital health market, emphasizing the importance of sustainable outcomes-driven business models [36] - The company is confident in its ability to drive sustained commercial growth and deliver measurable impact, with a robust pipeline of employer expansions and health plan launches expected in 2026 [32][34] Other Important Information - The company completed an equity raise and refinanced its debt, deferring debt amortization to 2028, which provides financial flexibility [17] - The leadership team has been strengthened with new appointments, enhancing execution and cross-functional alignment [16] Q&A Session Summary Question: Can you explain the timeline delays related to tariffs? - Management explained that delays were due to a large account transforming its offering and some specific partnerships affected by tariff issues, which impacted revenue expectations [42][43] Question: How is the partnership with RULA Health rolling out? - The company has begun systematic integration with existing clients, with positive adoption and plans for broader campaigns [48][49] Question: What is the path to cash flow breakeven by year-end? - Management indicated that achieving breakeven will be a combination of revenue growth and further reductions in operating expenses [51][53] Question: Can you provide an update on large pharma activities? - Management confirmed ongoing discussions with large pharma companies, with new contracts expected to contribute revenue in Q2 or Q3 [59][61] Question: How is the company managing contract transitions? - Management clarified that most contracts are being renewed, and transitions to different revenue models are not resulting in client losses [66][68]

Financial Data and Key Metrics Changes - In Q1 2025, the company reported revenue of $6.75 million, a 17% increase year over year driven by recurring revenue growth from B2B2C channels [11] - Non-GAAP gross margins improved to 70.5%, up from 62.4% in Q1 2024, with core B2B2C business sustaining above 81% gross margins for four consecutive quarters [14][37] - Non-GAAP operating loss decreased from $9.1 million to $5.8 million year over year, representing a 36% reduction [14] Business Line Data and Key Metrics Changes - The company signed 14 new clients in Q1 2025, including one national health plan, one regional health plan, and 12 employers, increasing the total client base to 97 from 83 at the end of 2024 [13][21] - Over 80% of new contracts are multi-condition, with an average contract length of three years and a renewal rate above 90% [13][21] Market Data and Key Metrics Changes - The market is shifting towards whole person digital health and platform consolidation, with employers and health plans seeking trusted partners for multi-condition care [9][22] - The company is actively engaged with multiple national and regional payers, with two top-tier health plans evaluating the full suite platform for deployment in 2026 [27][28] Company Strategy and Development Direction - The company is focused on executing a strategy centered on platform differentiation, client quality, and commercial scalability, leveraging AI to enhance operational efficiency and member engagement [15][33] - The integration of Twilio has strengthened the company's position in the industry, allowing it to support five chronic conditions under a unified brand [7][9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving operational cash flow breakeven run rate by the end of 2025, supported by existing account extensions and a deep pipeline of near-term opportunities [19][38] - The company is optimistic about the reset in the digital health market, emphasizing the importance of clinical credibility and financial discipline [38][40] Other Important Information - The company completed an equity raise and refinanced its debt, deferring debt amortization to 2028, which provides financial flexibility [19] - The leadership team has been strengthened with new appointments, enhancing execution and cross-functional alignment [18] Q&A Session Summary Question: Can you explain the timeline delays related to tariffs? - Management indicated that delays were due to a large account transforming its offering and some specific partnerships affected by tariff issues, which impacted revenue expectations [44][45] Question: How is the partnership with RULA Health rolling out? - The integration with RULA Health is underway, with initial adoption by a few clients and plans for broader campaigns [51][52] Question: What will drive the path to cash flow breakeven? - Achieving breakeven will be a combination of revenue growth and further reductions in operating expenses, with a focus on increasing gross margins from B2B2C business [54][56] Question: Can you provide an update on large pharma activities? - The company has signed new deals with large pharma companies, including Sanofi, and expects these to contribute revenue in Q2 or Q3 [62][65] Question: What is the impact of cleaning up contracts on revenue? - Most contracts are renewed, but transitioning to different revenue models for some accounts has created temporary headwinds [70][72]

Core Insights - DarioHealth Corp. reported a revenue of $6.75 million for Q1 2025, marking a 17% increase year-over-year but an 11.2% decrease sequentially due to a shift in scope with a large national health plan client [2][12][5] - The company is strategically positioned to capitalize on trends in healthcare, including the expansion of GLP-1 therapies and the integration of AI in healthcare solutions [2][3] - DarioHealth signed 14 new clients year-to-date, increasing its total client count to 97, with over 80% of new contracts being multi-condition [3][5] Financial Performance - Gross margin improved to 57.5% on a GAAP basis and 70.5% on a non-GAAP basis, reflecting operational efficiencies [4][5] - Total operating expenses decreased by 35% year-over-year to $13.3 million, with non-GAAP operating expenses at $10.6 million [4][17] - The GAAP operating loss decreased by 47% to $9.4 million compared to Q1 2024, while the non-GAAP operating loss narrowed to $5.8 million [7][19] Strategic Initiatives - The company is undergoing an AI transformation aimed at automating workflows and reducing costs, with an expected further 15-20% reduction in operating expenses over the next 12-18 months [6][11] - DarioHealth is focusing on building durable, recurring revenue through high-quality collaborations while phasing out low-margin business [8][9] - Key collaborations have been established to expand Dario's multi-condition offerings, enhancing its value-based care model [9][14] Leadership and Operational Focus - DarioHealth has strengthened its executive leadership team, which is focused on improving execution and operational efficiency [10] - The company has refinanced its debt and raised equity, enhancing its balance sheet and extending its cash runway [11][21] - DarioHealth aims to achieve operational cash flow breakeven by the end of 2025, supported by existing account expansions and new contract wins [5][11]

Financial Performance - Total revenues for Q1 2025 were $6.752 million, a 17.3% increase from $5.758 million in Q1 2024[22] - Gross profit for Q1 2025 was $3.882 million, compared to $2.432 million in Q1 2024, reflecting a significant improvement[22] - Operating loss for Q1 2025 was $9.409 million, reduced from $17.855 million in Q1 2024, indicating better cost management[22] - Net loss attributable to common shareholders for Q1 2025 was $14.066 million, compared to $9.209 million in Q1 2024, showing an increase in losses[22] - For the three months ended March 31, 2025, DarioHealth reported a net loss of $9,227,000, compared to a net loss of $7,175,000 for the same period in 2024, indicating an increase in losses of approximately 28.6%[27] - The company recorded tax expenses of $22 thousand for the three months ended March 31, 2025, compared to income tax of $1,994 thousand for the same period in 2024, reflecting a decrease of approximately 98.90%[128]. - The basic net loss per share for common stock was $(0.14) for the three months ended March 31, 2025, compared to $(66.78) for the same period in 2024, showing an improvement of approximately 79.09%[132][134]. Cash Flow and Liquidity - Cash and cash equivalents as of March 31, 2025, were $27.854 million, slightly up from $27.764 million at the end of 2024[16] - The company used approximately $6,673,000 in cash for operating activities during the three months ended March 31, 2025, a decrease from $13,110,000 used in the same period in 2024, reflecting a 49.1% improvement in cash flow usage[27] - DarioHealth's cash, cash equivalents, and restricted cash at the end of the period were $27,854,000, down from $35,041,000 at the end of March 2024, representing a decrease of 20.5%[27] - The company intends to fund future operations through cash on hand and additional offerings of debt or equity securities, highlighting the need for ongoing capital[29] Assets and Liabilities - Total current liabilities increased to $19.155 million as of March 31, 2025, from $16.635 million at the end of 2024[19] - Total assets decreased to $115.600 million as of March 31, 2025, down from $118.884 million at the end of 2024[16] - DarioHealth has an accumulated deficit of $404,409,000 as of March 31, 2025, indicating ongoing financial challenges since inception[29] - The allowance for credit losses increased from $163,000 at the beginning of the period to $191,000 by the end of March 31, 2025, reflecting a rise of 17.2%[40] Revenue Breakdown - Revenue from Commercial - Business-to-Business-to-Consumer (B2B2C) increased to $4,737,000 in Q1 2025 from $3,470,000 in Q1 2024, a growth of 36.5%[52] - DarioHealth's major customer accounted for 19.1% of the company's revenue for the three months ended March 31, 2025, compared to 8.5% and 16.5% for the same period in 2024[40] - The Company recognized a price concession of $1,088,000 in fiscal year 2024, which was recorded as a reduction in revenue[50] - The Company expects to recognize approximately $1,305,000 in deferred revenue over the next 12 months[54] Stock and Equity - The company raised approximately $22,422,000 from the issuance of 17,307 Series C, 4,000 Series C-1, and 1,115 Series C-2 preferred shares at a purchase price of $1,000 per share[99] - The company accounted for deemed dividends of $2,194,000 and $744,000 for the Series C, C-1, and C-2 preferred stock for the three-month periods ended March 31, 2025, and March 31, 2024, respectively[101] - The company issued 7,055 and 11,750 Series D and D-1 preferred shares in December 2024, raising approximately $18,805,000[101] - As of March 31, 2025, there were 25,605 shares of Series D, D-1, D-2, and D-3 preferred stock outstanding, convertible into approximately 36,533,135 shares of Common Stock[113] - The company modified the terms of Series B, B-1, and B-3 preferred shares, resulting in a deemed contribution of $12,194,000[109] Expenses - Research and development expenses for Q1 2025 were $4.108 million, down from $6.642 million in Q1 2024, indicating a focus on cost reduction[22] - The total stock-based compensation expenses for the three-month period ended March 31, 2025, amounted to $2,342,000, compared to $6,858,000 for the same period in 2024[122] - During the three months ended March 31, 2025, the Company recorded share-based compensation expenses of $65 related to a consulting firm[96] - The company recorded share-based compensation expenses of $893,000 for the three-month period ended March 31, 2024, and $0 for the same period in 2025[99] Debt and Financing - The Company refinanced its existing $25,000,000 credit facility to a new $30,000,000 facility on May 1, 2023[59] - The interest rate on the Avenue Loan Facility is set at the higher of 4.50% plus the prime rate or 12.50%[60] - The Company recorded remeasurement expenses related to the Avenue Loan of $270,000 for the three months ended March 31, 2025[66] - The Company refinanced its existing $30,000 credit facility with a new $32,500 credit agreement, allowing for an additional draw of up to $17,500[138] - The additional $17,500 Term Loan includes $2,500 subject to revenue and gross margin thresholds and $15,000 at the discretion of the Agent and Lenders[138] Shareholder Actions - The Compensation Committee approved a grant of 575,000 restricted shares of Common Stock and warrants to purchase up to 1,050,000 shares of Common Stock in February 2025[97] - The Company appointed Chen Franco-Yehuda as CFO, issuing her 500,000 restricted shares vesting over three years[138] - Stockholders approved the issuance of 33,956,850 shares of Common Stock from the conversion of 25,605 shares of Series D Preferred Stock[138] Miscellaneous - The Company has a liability to pay future royalties to the Israeli Innovation Authority amounting to 3% of sales from related products, totaling $954 as of March 31, 2025[88] - The Company recorded remeasurement income of $1,085 and $9,156 related to the Pre-Funded Warrants for the three-month periods ended March 31, 2025, and March 31, 2024, respectively[75] - The fair value of the Avenue Loan Facility was estimated using a discount rate of 19% as of March 31, 2025[82] - The fair value of the Orbimed Warrant liability was estimated using the Monte-Carlo simulation valuation technique, with a stock price of $0.61 and volatility of 88.4% as of March 31, 2025[84]

Core Insights - DarioHealth Corp. has published new research in JMIR demonstrating the effectiveness of personalized digital health interventions in increasing flu vaccination awareness among members with diabetes [1][2][4] Group 1: Research Findings - A pragmatic randomized follow-up study was conducted to assess how digital health tools can raise awareness and improve vaccination rates among people with diabetes [2] - The study involved 64,904 members segmented into three groups: one exposed to a previous flu vaccination campaign, one receiving a more personalized version of the campaign, and a control group with no exposure [3] - Results indicated that the group receiving personalized and frequent messages showed significantly improved awareness of flu risks and higher vaccination rates compared to the other groups [4] Group 2: Company Strategy and Impact - DarioHealth aims to deepen member engagement through personalized interventions that drive measurable clinical outcomes [5] - The company emphasizes the importance of personalization in improving health and transforming care through digital innovation [5][6] - Dario's platform provides continuous and customized care, promoting sustainable behavior change and enhancing user satisfaction and retention [7]

Core Viewpoint - DarioHealth Corp. will release its financial results for the first quarter of 2025 on May 14, 2025, and will host a conference call to discuss these results [1][2]. Group 1: Conference Call Details - The conference call is scheduled for May 14, 2025, at 8:30 a.m. Eastern Time [3]. - Participants can join via a domestic dial-in number (1-800-717-1738) or an international number (1-646-307-1865) [3]. - A replay of the call will be available approximately two hours after the event until May 28, 2025 [3]. Group 2: Company Overview - DarioHealth Corp. is a leader in the digital health market, focusing on chronic condition management through a user-centric digital therapeutics platform [4]. - The platform provides personalized interventions for conditions such as diabetes, hypertension, weight management, musculoskeletal pain, and behavioral health [4]. - DarioHealth's approach aims to empower users to make sustainable lifestyle changes, enhancing user satisfaction and retention [5]. Group 3: Market Reach - DarioHealth offers its solutions globally to health plans, self-insured employers, care providers, and consumers [6].