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Butterfly Network (BFLY)
NYSE:BFLY
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Butterfly Network
(NYSE:BFLY)
Rating:50Neutral
Price Target:
$2.50
▲(8.70%Upside)
Positive Factors
Market Expansion
The core POCUS business is seeing sales funnel expansion and interest across both hospital systems and medical schools, which should give visibility into the lift in probe sales over the coming quarters and years.
Product Innovation
BFLY has several big growth drivers, including the worldwide rollout of iQ3, the upcoming launch of Compass 2.0 software, and a major Octiv partnership.
Revenue Growth
Total revenue increased 20% with a notable rise in US revenue driven by higher sales volume to health systems and the delivery of semiconductor chips to new partners.
Negative Factors
Competition
Risks include slow rate of change in medicine with difficult-to-predict inflections, competition from larger players, and being unproven with opportunities.
Funding Uncertainty
The company's guidance considers the increased uncertainty some of its customers face regarding funding through the NIH, US Aid, and Medicaid.
Market Risks
Several potential risks were called out, including uncertainty among global health customers (who rely in part on government funding) and tariffs (manageable impact to costs).
Butterfly Network (BFLY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$568.76M
Dividend YieldN/A
Average Volume (3M)2.83M
Price to Earnings (P/E)―
Beta (1Y)2.49
Revenue Growth25.77%
EPS Growth49.44%
CountryUS
Employees190
SectorHealthcare
Sector Strength58
IndustryMedical - Devices
Share Statistics
EPS (TTM)-0.04
Shares Outstanding220,862,000
10 Day Avg. Volume2,787,030
30 Day Avg. Volume2,826,727
Financial Highlights & Ratios
PEG Ratio>-0.01
Price to Book (P/B)1.51
Price to Sales (P/S)0.00
P/FCF Ratio-2.62
Enterprise Value/Market Cap0.63
Enterprise Value/Revenue1.15
Enterprise Value/Gross Profit6.95
Enterprise Value/Ebitda-1.18
Forecast
1Y Price Target
$4.50Price Target Upside95.65% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
Butterfly Network Business Overview & Revenue Model
Company DescriptionButterfly Network, Inc., a digital health company, develops, manufactures, and commercializes ultrasound imaging solutions in the United States and internationally. It offers Butterfly iQ, a handheld and single-probe whole body ultrasound system; Butterfly iQ+, a point-of-care ultrasound imaging device that connects with a smartphone, tablet, and hospital computer system; and Butterfly Blueprint, a system-wide ultrasound platform with Compass software that integrates into a healthcare system's clinical and administrative infrastructure. The company also provides Butterfly system, which includes probes, and related accessories and software subscriptions, to healthcare systems, physicians, and healthcare providers through a direct sales force, distributors, and eCommerce channel. In addition, it offers cloud-based software solutions to healthcare systems, teleguidance, in-app educational tutorials, and formal education programs through its Butterfly Academy software, as well as clinical support and services. Butterfly Network, Inc. was incorporated in 2011 and is headquartered in Guilford, Connecticut.
How the Company Makes MoneyButterfly Network generates revenue primarily through the sale of its ultrasound devices. The Butterfly iQ+ is sold directly to healthcare providers, hospitals, and other medical institutions. Additionally, the company offers a subscription-based model for its software platform, which provides users with cloud storage, advanced imaging tools, and telemedicine capabilities. This software subscription model ensures a steady stream of recurring revenue. Butterfly Network also engages in partnerships with healthcare organizations and educational institutions to expand its market reach and bolster sales. These collaborations can include joint research initiatives, co-development projects, and distribution agreements that further contribute to its financial growth.
Butterfly Network Earnings Call Summary
Earnings Call Date:May 02, 2025
(Q1-2025)
| % Change Since: -1.71%|
Next Earnings Date:Jul 31, 2025
Earnings Call Sentiment Positive
The earnings call reflects a strong performance with significant revenue growth and strategic advancements, particularly in the U.S. market and medical schools. However, international revenue is facing challenges due to funding cuts and economic pressures. The company remains optimistic about overcoming these challenges with its diversified growth strategies.Q1-2025 Updates
Positive Updates
Strong Revenue Growth
Butterfly Network reported a 20% growth in revenue for Q1 2025, totaling $21.2 million, driven primarily by higher sales volume in U.S. sales channels and the launch of the iQ3 probe.
Improved Gross Margins
Gross margins improved from 58% to 63% year-over-year, attributed to higher average selling prices and reduced software amortization and hosting costs.
Enterprise Hospital Program Success
Butterfly Network is on the verge of signing its second hospital enterprise customer, with a commitment to integrate Butterfly's Compass software throughout their network, following the proliferation of Butterfly probes.
Expansion in Medical Schools
Significant progress in medical schools with more institutions adopting one probe per student programs, creating a sustainable, recurring revenue model.
Launch of Octiv and Butterfly Garden
Continuing progress with the Octiv program, including an upcoming partnership announcement in the generative AI space, and expansion of the Butterfly Garden AI marketplace with new FDA-cleared applications.
Negative Updates
Impact of USAID Funding Cuts
USAID funding cuts have led to delays in several opportunities within Butterfly Network's international revenue base, particularly affecting partnerships in low- and middle-income countries.
Economic and Tariff Pressures
Potential tariff impacts could result in additional costs for importing probes to the U.S., and broader economic pressures could delay deal closures.
Lower Software Renewal Rates
While software and services revenue increased by 11%, the growth was partially offset by lower renewals of individual subscriptions.
Company Guidance
During the Butterfly Network's first quarter 2025 earnings call, the company announced a 20% revenue growth, reaching $21.2 million, driven by increased sales of the iQ3 probe and higher demand in U.S. sales channels. The gross margin improved to 63%, up from 58% the previous year, with adjusted EBITDA loss reduced from $13.2 million in Q1 2024 to $9.1 million. International revenue grew 9% to $4.6 million, while U.S. revenue increased 24% to $16.6 million. Product revenue rose 25% to $14.2 million, whereas software and other services grew 11% to $7.1 million. The company reiterated its full-year guidance of 20% revenue growth with an adjusted EBITDA loss between $37 million and $42 million, despite economic uncertainties and potential tariff impacts.Butterfly Network Financial Statement Overview
Summary
Butterfly Network faces significant financial challenges, including unprofitability and negative cash flows. Despite some strengths in revenue growth and cost management, operational inefficiencies persist. The balance sheet is relatively stable with low leverage, but ongoing losses and cash flow issues could impact future stability.Income Statement
Butterfly Network has shown modest revenue growth with a year-over-year increase of approximately 4.35% in the TTM. However, the company is currently unprofitable with a negative net profit margin of -75.57% and a negative EBIT margin of -81.35%, indicating significant operational challenges. The gross profit margin is positive at 60.65%, suggesting some strength in cost management, but overall profitability remains a concern.40
Negative
Balance Sheet
The company's balance sheet reflects a moderate level of stability with a debt-to-equity ratio of 0.08, indicating low leverage. The equity ratio is relatively strong at 75.27%, demonstrating a solid equity base relative to total assets. However, the company has been consistently recording negative net income, which adversely affects return on equity, currently not calculable due to negative net income.50
Neutral
Cash Flow
Butterfly Network's cash flow situation is challenging, with negative free cash flow and operating cash flow in the TTM. Despite a reduction in negative free cash flow compared to the previous period, the company continues to experience cash outflows from operations, affecting its liquidity position. The operating cash flow to net income ratio is not favorable, reflecting the need for better cash management strategies.45
Neutral
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 85.62M | 82.06M | 65.90M | 73.39M | 62.56M | 46.25M | Gross Profit |
| 51.93M | 48.83M | 16.86M | 39.46M | 17.05M | -61.22M | EBIT |
| -69.65M | -74.41M | -145.61M | -193.02M | -192.73M | -161.62M | EBITDA |
| -60.52M | -60.92M | -124.84M | -162.74M | -29.55M | -160.25M | Net Income Common Stockholders |
| -64.70M | -72.49M | -133.70M | -168.72M | -32.41M | -162.75M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 155.21M | 88.78M | 134.44M | 237.81M | 422.84M | 60.21M | Total Assets |
| 318.41M | 256.08M | 304.27M | 417.57M | 571.97M | 147.19M | Total Debt |
| 19.76M | 22.84M | 25.03M | 31.89M | 27.69M | 53.89M | Net Debt |
| -135.46M | -65.94M | -109.41M | -130.67M | -395.15M | -6.31M | Total Liabilities |
| 78.72M | 87.25M | 84.22M | 92.21M | 124.27M | 509.12M | Stockholders Equity |
| 239.70M | 168.83M | 220.05M | 325.36M | 447.69M | -361.93M |
| Cash Flow | Free Cash Flow | ||||
| -34.63M | -44.40M | -104.60M | -187.42M | -197.06M | -84.08M | Operating Cash Flow |
| -32.72M | -41.71M | -98.82M | -169.12M | -189.19M | -81.70M | Investing Cash Flow |
| -1.87M | -2.66M | 70.41M | -93.78M | -9.87M | -2.38M | Financing Cash Flow |
| 76.97M | -1.50M | 228.00K | 2.88M | 565.69M | 54.28M |
Butterfly Network Technical Analysis
Negative
2.30
Price Trends
2.34
Negative
2.90
Negative
2.71
Negative
Market Momentum
0.02
Negative
45.48
Neutral
41.77
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BFLY, the sentiment is Negative. The current price of 2.3 is below the 20-day moving average (MA) of 2.38, below the 50-day MA of 2.34, and below the 200-day MA of 2.71, indicating a bearish trend. The MACD of 0.02 indicates Negative momentum. The RSI at 45.48 is Neutral, neither overbought nor oversold. The STOCH value of 41.77 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for BFLY.
Butterfly Network Risk Analysis
Butterfly Network disclosed 48 risk factors in its most recent earnings report. Butterfly Network reported the most risks in the "Tech & Innovation" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Butterfly Network Peers Comparison
Overall Rating
UnderperformOutperform
Sector (54)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $742.34M | ― | -15.96% | ― | 22.60% | 41.26% | |
62 Neutral | $524.11M | ― | -11.33% | ― | 31.28% | -81.86% | |
54 Neutral | $5.37B | 3.26 | -45.10% | 3.30% | 16.81% | 0.02% | |
52 Neutral | $559.55M | 45.80 | -36.78% | ― | 1.34% | -530.36% | |
50 Neutral | $568.76M | ― | -29.16% | ― | 25.77% | 49.44% | |
49 Neutral | $430.99M | ― | -27.82% | ― | 5.85% | -8.92% | |
47 Neutral | $543.80M | ― | -19.79% | ― | 8.60% | -42.76% |
* Healthcare Sector Average
Performance Comparison
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152.75%
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KIDS
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21.16
-8.26
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SIBN
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17.42
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BVS
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6.62
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.