Yahoo Finance Butterfly Network Inc (BFLY) Q1 2024 Earnings Call Transcript Highlights: Revenue Growth and ...
Revenue: $17.7 million, a 14% increase from the previous year.
Net Income: Not specifically mentioned, focus on EBITDA instead.
EBITDA: Adjusted EBITDA loss of $13.2 million, an improvement from a loss of $22.3 million in the previous year.
Gross Margin: Remained relatively flat at 58%.
Product Revenue: $11.3 million, up 28% from Q1 2023.
Software and Services Revenue: $6.4 million, slightly down from the previous year.
Annual Recurring Revenue (ARR): Grew by 4% year-over-year.
U.S. Revenue: $12.2 million, a 19% increase.
International Revenue: $4.2 million, up 14%.
Cash and Cash Equivalents: $117 million, providing a runway into 2026.
2024 Revenue Guidance: Expected to be in the range of $75 to $80 million.
2024 EBITDA Guidance: Projected loss of $55 to $50 million.
Release Date: May 01, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
Butterfly Network Inc reported a 14% revenue growth in Q1 2024, reaching $17.7 million, marking the highest first quarter in the company's history.
The successful launch of IQ three, which received FDA clearance and was introduced ahead of schedule, significantly contributed to the quarter's performance.
International revenue grew by 14%, driven by improved execution from distributors and strong performance from the international direct team.
Butterfly Network Inc has extended its cash runway into 2026 due to ongoing efforts to streamline operations and become more cash-efficient.
The company is actively expanding its product offerings and markets, with plans to launch IQ three in Canada and Europe later in 2024.
Negative Points
Software and services revenue was slightly down in Q1 2024, primarily due to lower individual subscription renewals.
The company received a notification from the NYSE about non-compliance with the standard requiring a 30-day stock price moving average of at least $1.
Despite the strong quarter, Butterfly Network Inc still reported an adjusted EBITDA loss of $13.2 million for Q1 2024.
The company faces challenges in maintaining and growing its stock price to reflect its business value and avoid potential delisting.
Butterfly Network Inc is still in the process of exploring non-dilutive financing options to extend its cash runway and pathway to profitability.
Q & A Highlights
Q: Can you provide insights into the initial key areas of uptake for IQ three, such as cardiology or OB/GYN? A: Joseph Devivo, CEO of Butterfly Network, highlighted significant uptake in cardiology, where many new orders are originating. The emergency room and critical care are also strong areas, with continued robust sales of IQ Plus, indicating broadened customer reach.
Q: Regarding the home care initiative, can you elaborate on the expected business model and revenue generation? A: Joseph Devivo explained that the focus is on service revenue and potentially taking on risk based on clinical outcomes, rather than just device sales. This model aims to support hospitals in managing readmissions, which are costly, by providing services that help manage patient care at home.
Q: Can you discuss the financial impact of deploying Butterfly Network's technology in hospitals, specifically referring to the University of Rochester's experience? A: Joseph Devivo shared that the University of Rochester saw a significant increase in revenue capture from point-of-care ultrasound exams after deploying Butterfly Network's technology system-wide. This deployment not only improved clinical decision-making but also did not detract from radiology revenues, showcasing the additive value of point-of-care ultrasound.
Q: What are the non-dilutive financing options being explored, and how might these impact the path to profitability? A: Joseph Devivo mentioned exploring service revenue models and success-based risk sharing in clinical settings, particularly in home care. Additionally, licensing deals, such as the one with 4US Neuro tech, are being pursued to leverage Butterfly Network's semiconductor technology in other markets, potentially providing significant non-dilutive capital.
Q: How does the adoption curve of IQ three compare to previous models like IQ and IQ Plus? A: Heather Getz, CFO, noted that it's still early days to draw definitive conclusions about the adoption curve of IQ three compared to earlier models, especially with only half a quarter of sales data available. However, the initial reception has been very positive.
Q: What are the implications of the European Commission's Roadhouse directive on Butterfly Network's business? A: Joseph Devivo discussed ongoing dialogues with the European Commission, expressing optimism about the directive potentially favoring Butterfly Network's technology over traditional lead-based systems. This could lead to a ban on sales of older ultrasound technologies in the EU, benefiting Butterfly Network.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
