Shares of Butterfly Network Inc (NYSE: BFLY) tumbled 5.48% in after-hours trading following the release of its third-quarter 2025 financial results. Despite beating revenue expectations, the digital health company reported a wider net loss, which appears to have spooked investors.
Butterfly Network, known for its portable ultrasound technology, reported Q3 revenue of $21.5 million, representing a 5% year-over-year growth and surpassing the analyst consensus estimate of $21.22 million. However, the company's net loss expanded significantly to $34 million, compared to $16.9 million in the same period last year.
While Butterfly Network highlighted its reduced quarterly cash burn of $3.9 million, a new record low for the company, investors seemed more focused on the widening losses. The increased net loss could be attributed to various factors, including a substantial $17.4 million write-down of excess and obsolete inventory recognized during the quarter.
Despite the challenges, Butterfly Network reaffirmed its full-year 2025 revenue guidance of $91 million to $95 million, representing approximately 13% growth. The company also narrowed its adjusted EBITDA loss guidance to a range of $32 million to $35 million.
Joseph DeVivo, Butterfly's President, CEO, and Chairman, remained optimistic about the company's future, stating, "Even in a seasonally softer period, we delivered growth on top of last year's record third quarter growth, while continuing to reduce our use of cash. We stayed on the offense -- advancing AI, strengthening enterprise readiness, and pushing forward on technology milestones that will shape our future."
However, the market's negative reaction suggests that investors may be growing impatient with the company's path to profitability. As Butterfly Network continues to invest in technology advancements such as its P5.1 chip and Apollo AI chip development, the balance between growth investments and financial performance will likely remain a key focus for shareholders in the coming quarters.
Comments