Core Insights - Butterfly Network, Inc. will report its fourth quarter and full year 2025 financial results on February 26, 2026, at 8:00 am ET [1] - The conference call will be hosted by Joseph DeVivo, President and CEO, and John Doherty, CFO, to discuss financial performance and operational progress [1] Company Overview - Butterfly Network is a healthcare company focused on transforming medical imaging through its proprietary Ultrasound-on-Chip™ technology and ultrasound software solutions [3] - The company launched the first handheld, single-probe, whole-body ultrasound system, Butterfly iQ, in 2018, followed by iQ+ in 2020 and iQ3 in 2024, each with enhanced processing power [3] - The iQ3 received the Best Medical Technology award at the 2024 Prix Galien USA Awards, highlighting its recognition in the healthcare sector [3] Product and Market Strategy - Butterfly combines advanced hardware, intelligent software, AI, services, and education to promote the adoption of affordable and accessible imaging solutions [4] - Clinical publications indicate that Butterfly's handheld ultrasound probes, when paired with Compass™ enterprise workflow software, can improve care workflows, reduce costs, and enhance provider economics [4] - The company's cloud-based solution enables healthcare delivery anywhere, addressing significant global healthcare challenges and aiming to democratize healthcare [4] - Butterfly devices are available to trained healthcare practitioners across various regions, including parts of Africa, Asia, Australia, Europe, the Middle East, North America, and South America [4]

Group 1 - Butterfly Network, Inc. (NYSE:BFLY) has received positive ratings from analysts, with Craig-Hallum raising the price target to $5.25 from $3.25 and maintaining a Buy rating, while Lake Street raised its target to $5.50 from $4, also reiterating a Buy rating [1][2] - The company reported a year-over-year revenue growth of at least 17% for Q4, amounting to $26.2 million, surpassing the Street's estimate of $25.7 million, with a full-year revenue of $92.3 million [1][3] - The growth is primarily attributed to the core business, with some revenue in Q4 coming from a partnership with Midjourney [1] Group 2 - Butterfly Network specializes in digital health, focusing on transforming care through software and semiconductor-based ultrasound technology, with two portable ultrasound devices available: Butterfly iQ3 and Butterfly iQ+ [4] - The company's Ultrasound-on-Chip technology enables whole-body imaging using a single handheld probe, showcasing innovation in the ultrasound market [4]

Core Insights - Butterfly Network, Inc. anticipates a revenue growth of at least 17% year-over-year for the fourth quarter ending December 31, 2025 [1] - The company is entering 2026 with strong momentum in its handheld ultrasound business and plans to outline its growth strategy at the upcoming J.P. Morgan Healthcare Conference [2] Company Overview - Butterfly Network is a digital health company focused on transforming medical imaging through its proprietary Ultrasound-on-Chip™ technology and software solutions [3] - The company launched the first handheld, single-probe, whole-body ultrasound system, Butterfly iQ, in 2018, followed by the iQ+ in 2020 and the iQ3 in 2024, each improving in processing power and performance [3] - The iQ3 received the Best Medical Technology award at the 2024 Prix Galien USA Awards, highlighting its recognition in the healthcare sector [3] Business Strategy - Butterfly combines advanced hardware, intelligent software, AI, services, and education to promote the adoption of affordable imaging solutions [4] - The company aims to democratize healthcare by addressing global healthcare challenges through its cloud-based solutions, which enable care delivery anywhere [4] - Butterfly's devices are available to trained healthcare practitioners across various regions, including Africa, Asia, Europe, and the Americas [4]

Core Insights - Butterfly Network, Inc. is participating in the 8th Annual Evercore Healthcare Conference, with key executives scheduled for a fireside chat and one-on-one investor meetings [1][2] - The company is recognized for its innovative Ultrasound-on-Chip™ technology and has launched several handheld ultrasound systems, including the award-winning iQ3 [3][4] Company Overview - Butterfly Network, Inc. is a digital health company focused on transforming medical imaging through handheld, whole-body ultrasound technology and intuitive software solutions [1][3] - The company launched the first handheld, single-probe, whole-body ultrasound system, Butterfly iQ, in 2018, followed by the iQ+ in 2020 and the iQ3 in 2024, each improving in processing power and performance [3] - The iQ3 received the Best Medical Technology award at the 2024 Prix Galien USA Awards, highlighting its significance in the healthcare sector [3] Product and Technology - Butterfly combines advanced hardware, intelligent software, AI, services, and education to enhance the adoption of affordable and accessible imaging solutions [4] - The company’s handheld ultrasound probes, paired with Compass™ enterprise workflow software, have been shown to improve care workflows, reduce costs, and enhance provider economics [4] - Butterfly's devices are available to trained healthcare practitioners globally, addressing critical healthcare challenges [4]

Financial Data and Key Metrics Changes - Revenue for Q3 2025 was $21.5 million, reflecting a 5% growth over the prior year, driven by higher average selling prices and increased volume, particularly in the U.S. [14][15] - Gross margin, including a non-cash inventory write-off of $17.4 million, was negative 17.5%, compared to 59.5% in the prior year. Adjusted gross margin increased to 63.9% from 60% in the prior year [17][18] - Adjusted EBITDA loss was $8.1 million, an improvement from a loss of $8.4 million in Q3 2024, leading to a normalized cash burn of $3.9 million [18][19] - Cash and cash equivalents at the end of the quarter were $148 million, with a trailing 12-month cash use of $31.5 million [19] Business Line Data and Key Metrics Changes - Product revenue was $14.6 million, an increase of 8% versus Q3 2024, driven by higher average selling prices in international markets and increased volume in e-commerce and veterinary channels [15][16] - Software and other services revenue was $6.9 million, flat compared to the prior year, with increased licensing and services revenue offset by lower renewals of individual subscriptions [16] Market Data and Key Metrics Changes - Total international revenue increased 4% over the prior year to $5.4 million, primarily driven by price increases following the international launch of iQ3 [15] - U.S. revenue was $16.1 million, slightly up from the previous year, attributed to e-commerce sales and improved performance in the veterinary distribution channel [15] Company Strategy and Development Direction - The company is focusing on enterprise sales by building a strategy that integrates Butterfly more holistically within health systems, despite facing headwinds in the second quarter [5][6] - The five-year plan introduced multiple growth pillars, including deeper engagement in core business areas and expansion into new markets [5][6] - The AI strategy is seen as a significant accelerator, with successful trials demonstrating the economic impact of Butterfly's AI tools on patient care and hospital efficiency [8][12] Management's Comments on Operating Environment and Future Outlook - Management noted that while Q3 is typically the quietest quarter, they are optimistic about returning to momentum in 2026, with increased pipeline opportunities [5][21] - The company reaffirmed its full-year revenue guidance of $91 to $95 million, indicating a need to close larger deals in the pipeline to reach the higher end of the range [22][23] - Management expressed confidence in the long-term positioning of Butterfly Network, emphasizing the affordability and flexibility of their technology compared to traditional ultrasound solutions [24] Other Important Information - The company has strengthened its information security posture with new certifications, enhancing its competitive advantage in the market [7][56] - The P5.1 chip development has been completed, expected to significantly enhance imaging capabilities and performance, with production set to begin [26][27] Q&A Session Summary Question: Can you quantify the size of some deals that have been pushed due to macro factors? - Management indicated that deals can range from 100 to 200 probes, with large medical school deals also in the pipeline [33][35] Question: What is the outlook for the sales pipeline heading into 2026? - Management noted that while the time to close has extended, there are more deals stacking up, and they expect a lift in 2026 as budgets reset [41][42] Question: How will the cost-effectiveness data from the Rutgers study impact future sales? - The study establishes significant economic benefits, which will strengthen the company's position in enterprise sales discussions [43][46] Question: What is the status of the HomeCare program? - Management remains optimistic about the channel but emphasized that until agreements are finalized, nothing is certain [47] Question: What is needed to de-risk the launch of the P5.1 chip? - Management expressed confidence in the low risk of execution for the new product launch, citing successful past launches as a precedent [50][52] Question: How does the new information security certification help win business? - The company believes its cloud connectivity and security posture provide a competitive advantage, especially as the industry shifts towards cloud solutions [56][57]

Core Insights - Butterfly Network has launched an AI-powered Gestational Age tool in Malawi and Uganda to enhance maternal and fetal health through improved access to ultrasound technology [1][4] - The tool allows lower-skilled healthcare workers to estimate gestational age quickly and accurately without requiring image interpretation or extensive training [4][5] - The initiative is part of Butterfly's broader commitment to advancing maternal health in under-resourced settings, supported by the Gates Foundation and developed in collaboration with the University of North Carolina [4][5] AI-Enabled Gestational Age Tool - The AI tool addresses the critical need for affordable ultrasound technology in low-resource settings, where 92% of maternal and neonatal mortality occurs in low- and middle-income countries [2] - It enables midwives and other healthcare providers to deliver timely care by determining the appropriate gestational age for necessary medical interventions [4] Milestone Achievements - Butterfly Network has successfully deployed 1,000 handheld ultrasound probes and trained over 1,050 healthcare providers in Sub-Saharan Africa from September 2022 to December 2024 [6] - As of July 2025, 1.8 million scans have been conducted, averaging 83,000 scans monthly, demonstrating significant integration of obstetrical ultrasound services in over 697 public health facilities [6] Positive Impact on Maternal Health - Preliminary data from Kenya indicates a significant increase in women seeking antenatal care before 24 weeks, with over 90% patient satisfaction reported [9] - In South Africa, there has been a notable reduction in stillbirths and maternal mortality, with 873 appropriate referrals made for higher-level care [10][11] - The average scan time for providers has been reduced to 1.3 minutes, with a high confidence level in detecting key maternal conditions post-training [12] Technological Advancements - The latest Butterfly device, iQ3, has been approved for use in South Africa and Kenya, enhancing the quality and accessibility of POCUS [7] - Butterfly's innovations have received multiple accolades, including the Best Medical Technology at the 2024 Prix Galien USA Awards, highlighting the company's commitment to advancing healthcare technology [14]

Core Insights - The study published in JAMA confirms that a Butterfly-enabled POCUS program focused on lung ultrasound significantly reduces hospital stay and costs associated with undifferentiated dyspnea, including acute heart-failure exacerbations [1][2][3]. Study Findings - The POCUS program led to a reduction of 246 hospital bed-days and resulted in direct cost savings of $751,537 during the evaluation period [3][4]. - The integration of a hospitalist POCUS workflow, which included lung ultrasound and AI assistance, was associated with a 30% reduction in expected hospital length of stay (8.3 days compared to 11.9 days, p = .01) [7]. - Clinical management was altered in 35% of cases due to the use of POCUS, highlighting its impact on patient care [7]. Economic Impact - The incremental cost-effectiveness ratio was calculated at $3,055 per hospital bed day saved, demonstrating the economic value of POCUS integration into inpatient care [7]. - The study emphasizes the potential for POCUS to improve hospital resource utilization and patient care through structured workflows [4][6]. Company Background - Butterfly Network, Inc. is a digital health company that specializes in portable ultrasound technology and software solutions, aiming to transform healthcare delivery [2][9]. - The company has developed a series of handheld ultrasound devices, including the Butterfly iQ, iQ+, and iQ3, which leverage advanced semiconductor technology [9][10].

Financial Data and Key Metrics Changes - The company reported record revenue of $23.4 million for Q2 2025, representing a 9% increase year-over-year, driven by higher average selling prices and sales of semiconductor chips [16][20] - Gross margins reached an all-time high of 64%, up from 59% in the prior year, attributed to higher average selling prices and improved software and services margins [20] - Adjusted EBITDA loss improved to $6.2 million from $8.1 million in the same period last year, reflecting a 24% improvement [20][24] Business Line Data and Key Metrics Changes - Product revenue was $16.6 million, a 13% increase compared to Q2 2024, primarily due to higher average selling prices and chip sales [18] - Software and other services revenue remained flat at $6.8 million, impacted by lower renewals of individual subscriptions and implementation services revenue [19] - Total annual recurring revenue (ARR) grew slightly, led by an increase in enterprise software subscription ARR [19] Market Data and Key Metrics Changes - U.S. revenue was $17.2 million, essentially flat year-over-year, affected by lower probe volume despite chip sales [17] - International revenue increased by 19% to $6.2 million, driven by price and volume growth from the international launch of iQ3 [18] Company Strategy and Development Direction - The company is focusing on larger deals and expanding its enterprise and medical school pipeline, with a recent large enterprise deal closed in Q2 [7][8] - The launch of the next-generation software platform, Compass AI, is expected to enhance documentation processes and increase penetration within existing customers [27][28] - The company is optimistic about the long-term growth potential of handheld ultrasound technology and aims to leverage its core competencies to deliver new revenue streams [32][33] Management's Comments on Operating Environment and Future Outlook - Management acknowledged macroeconomic headwinds affecting purchase decisions and delayed large deals, but remains confident in the long-term value proposition of its products [5][24] - The company adjusted its full-year revenue guidance to a range of $91 million to $95 million, emphasizing fiscal discipline while investing in growth areas [24][25] - Management believes that the current uncertainties are temporary and expects a return to normalcy as healthcare providers adapt to changes [60][61] Other Important Information - The company announced the departure of its CFO, Heather Getz, with Megan Carlson appointed as interim CFO [13][14] - The Butterfly Garden initiative is entering its commercial phase, with new AI tools expected to enhance clinical use [9][11] Q&A Session Summary Question: Competitive landscape and its impact - Management clarified that the guidance revision was not due to competitive pressures but rather delays in larger deals, emphasizing that they are pioneering new market segments [36][38] Question: Software subscription revenue trends - The software revenue is experiencing a mixed performance, with individual subscriptions facing churn while enterprise software is growing, aided by the upcoming Compass AI [41][42] Question: Guidance assumptions and enterprise side impact - Management noted that delays in global health deals and enterprise sales have led to a conservative guidance revision, but they remain optimistic about future opportunities [55][56] Question: Home care program details - The home care program is expected to generate revenue through a program fee based on enrolled patients and revenue per scan, with significant potential for scaling [67][69] Question: Readmission reduction in heart failure - Management indicated a significant reduction in readmissions, with plans to demonstrate the scalability of pilot results to secure broader agreements [84][85] Question: IQ Station and P5 updates - The IQ Station is expected to compete with existing ultrasound carts, while the P5 technology is anticipated to significantly enhance image quality, positioning the company favorably in the market [90][92]

Financial Data and Key Metrics Changes - The company reported record revenue of $23.4 million for Q2 2025, representing a 9% increase compared to the previous year, driven by higher average selling prices and sales of semiconductor chips [16][20] - Gross margins reached an all-time high of 64%, up from 59% in the prior year, attributed to higher average selling prices and improved software and services margins [20] - Adjusted EBITDA loss improved to $6.2 million from $8.1 million in the same period last year, reflecting a 24% improvement [20][24] Business Line Data and Key Metrics Changes - Product revenue was $16.6 million, a 13% increase year-over-year, primarily due to higher average selling prices and chip sales [18] - Software and other services revenue remained flat at $6.8 million, impacted by lower renewals of individual subscriptions and implementation services revenue [19] - Total Annual Recurring Revenue (ARR) grew slightly, led by an increase in enterprise software subscription ARR [19] Market Data and Key Metrics Changes - U.S. revenue was $17.2 million, essentially flat year-over-year, affected by lower probe volume despite higher average selling prices [17] - International revenue increased by 19% to $6.2 million, driven by the international launch of iQ3 and geographic expansion [17] Company Strategy and Development Direction - The company is focusing on larger deals and expanding its enterprise and medical school pipeline, despite delays in closing some larger deals [6][22] - The launch of the next-generation software platform, Compass AI, is expected to enhance documentation processes and improve enterprise sales [27][28] - The company is optimistic about the long-term growth potential of handheld ultrasound technology and its ability to drive worldwide adoption [34] Management's Comments on Operating Environment and Future Outlook - Management noted macroeconomic headwinds affecting purchase decisions, particularly in the U.S. hospital and enterprise channels [22][60] - The company has adjusted its full-year revenue guidance to a range of $91 million to $95 million, reflecting the need to close delayed larger deals [23][24] - Management remains confident in the company's value proposition and believes it will thrive in a cost-contained healthcare environment [5][34] Other Important Information - The company announced the departure of its CFO, Heather Gatz, who will transition to an advisory role until early 2026 [13][15] - The Butterfly Garden initiative is entering its commercial phase, with new AI tools expected to enhance clinical use [9][11] Q&A Session Summary Question: Competitive landscape and headwinds - Management clarified that the guidance revision was not due to competition but rather delays in larger deals, emphasizing that they are pioneering new market segments [36][38] Question: Software subscription revenue trends - Management indicated that individual subscription renewals face challenges, while enterprise software is growing, aided by the upcoming Compass AI [42][44] Question: Guidance assumptions and enterprise side impact - Management noted that delays in global health deals and enterprise sales have led to a conservative guidance adjustment, but they remain optimistic about future opportunities [54][56] Question: Home care pilot program details - Management shared that the home care program has shown significant reductions in readmissions, and they are working to finalize commercial agreements [65][67] Question: IQ Station and P5 updates - Management confirmed that IQ Station will compete with existing ultrasound carts, and the P5 technology is expected to significantly enhance image quality [91][93]

Core Insights - The Medical Info Systems industry is experiencing significant growth driven by new federal policies and the $500 billion Stargate AI project initiated by Donald Trump, which aims to enhance AI infrastructure in healthcare [1][3][5] - The use of AI in the medical device market is projected to grow at a CAGR of 29.9% from 2026 to 2029, indicating strong demand for digital healthcare solutions [1][3] - The industry faces challenges due to escalating tariffs on imports, which could hinder the development of AI technologies essential for healthcare [2][5] Industry Overview - The Zacks Medical Info Systems industry includes companies that develop healthcare information systems, providing software and hardware solutions for secure access to clinical, administrative, and financial data [2] - The focus on patient satisfaction and data security has increased the demand for big data, cloud computing, blockchain, and AI technologies [2] Trends Influencing the Industry - AI is being increasingly adopted in the medical sector for drug synthesis, device creation, and diagnostics, with the global AI in healthcare market expected to reach $95.65 billion by 2025 [3] - Remote patient monitoring is growing rapidly due to the rise in wearable devices and telehealth services, with the global smart healthcare products market projected to grow from $145.9 billion in 2023 to $485.71 billion by 2032, at a CAGR of 12.78% [4] Financial Performance - The Zacks Medical Info Systems industry has underperformed the S&P 500 and the broader medical sector over the past year, with a decline of 6.6% compared to a 25.3% increase in the S&P 500 [9] - The industry is currently trading at a forward price-to-sales (P/S) ratio of 3.95, lower than the S&P 500's 4.56 and the sector's 2.50 [12] Investment Opportunities - Veeva Systems, with a Zacks Rank 1 (Strong Buy), is expected to see an 11% earnings growth for fiscal 2026 [18] - Hims & Hers Health, holding a Zacks Rank 2 (Buy), anticipates a 58% increase in earnings for 2025, driven by a growing subscriber base [22] - Butterfly Network, also with a Zacks Rank 2, projects a 5.9% improvement in earnings for 2025 [26]