Butterfly Network, Inc. (BFLY): Results of Operations and Financial Condition
Butterfly Network, Inc. (BFLY) filed an SEC Form 8-K — Results of Operations and Financial Condition. Exhibit 99.1 Butterfly Network Reports Second Quarter 2026 Financial Results Delivered Record Revenue and Adjusted EBITDA Loss Above Guidance • Raised full year Revenue and Improved Adjusted EBITDA Guidance • Delivered quarterly Revenue of $32.6 million in Q2, representing 39% Yo
How this was made
The 30-second read
Why it matters
The filing provides fresh, decision-relevant numbers: Q2 performance (revenue, gross margin, adjusted EBITDA loss) and explicit guidance ranges for FY 2026 and Q3 2026, plus operational milestones that can affect near-term demand and procurement eligibility.
Market read
Traders can reprice BFLY based on raised FY 2026 revenue and improved adjusted EBITDA loss guidance, plus concrete progress on government and international expansion.
What to watch
Key execution risks remain around FedRAMP certification in Q3 2026, Home & Community Care commercialization timing (revenue expected in Q4), and international probe sales volatility.
Butterfly Network Reports Second Quarter 2026 Financial Results Delivered Record Revenue and Adjusted EBITDA Loss Above Guidance
Revenue grew 39% year-over-year to a record $32.6 million, gross margin expanded to 71.4%, adjusted EBITDA loss improved 78% to $1.4 million, and the Company raised Fiscal Year 2026 revenue and adjusted EBITDA guidance.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Total revenueGAAP | $32.6 million | – | 39% |
| Gross profitGAAP | $23.3 million | – | – |
| Gross marginGAAP | 71.4% | – | – |
| Operating expensesGAAP | $37.0 million | – | 19% |
| Total operating expenses excluding stock-based compensation and other expensesnon-GAAP | $26.3 million | – | – |
| Net lossGAAP | $12.9 million | – | – |
| Adjusted EBITDA lossnon-GAAP | $1.4 million | – | 78% |
| EPSGAAP | $(0.05) | – | – |
| Adjusted EPSnon-GAAP | $(0.01) | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| U.S. revenuePrimarily driven by revenue from Butterfly Embedded™ partnerships, including the co-development partnership with Midjourney, as well as increased probe sales volume to health system, medical school, and eCommerce customers. | $27.6 million | – | 57% |
| International revenueLargely resulting from decreased probe sales to international distribution partners during the second quarter, partially offset by recent commercial expansion into the Brazilian medical device market. | $5.0 million | – | decreased 14% year-over-year |
Fiscal Year 2026 outlook
- Revenue$119 million to $123 million
- Noteapproximately 22% to 26% growth
- NoteAdjusted EBITDA loss of $19 million to $23 million
- Note3rd Quarter of 2026 revenue of $26 million to $30 million
- Note3rd Quarter of 2026 revenue of approximately 30% growth year-over-year at the midpoint
- Note3rd Quarter of 2026 adjusted EBITDA loss of $6 million to $9 million
What drove it
- Butterfly Embedded™ added two new partners, bringing the Embedded portfolio to 11 partners.
- Midjourney and Aleph Neuro unveiled applications being built with Butterfly's Ultrasound-on-Chip™ platform.
- The Company signed six new enterprise software agreements and expanded the Compass AI software pipeline meaningfully year over year.
- Gross-margin expansion was primarily due to relatively higher-margin Butterfly Embedded™ licensing revenue and a reduction in software amortization costs for historic software development investments.
- The Company received regulatory authorization in Brazil.
- Home & Community Care was prepared for first commercial implementation in the second half of 2026, with revenue expected in the fourth quarter.
Concerns
- International revenue decreased 14% year-over-year to $5.0 million, largely due to decreased probe sales to international distribution partners.
- Operating expenses increased 19% to $37.0 million.
- The Company reported a net loss of $12.9 million and an adjusted EBITDA loss of $1.4 million.
- Third Quarter of 2026 guidance calls for an adjusted EBITDA loss of $6 million to $9 million.
What to watch
- Achievement of FedRAMP certification in the third quarter of 2026 following provisional authorization to sell across the U.S. Department of Veterans Affairs.
- First commercial implementation of Home & Community Care in the second half of 2026 and expected revenue in the fourth quarter.
- Commercial availability by year-end of three existing Butterfly Garden™ partner tools.
- Execution against Fiscal Year 2026 revenue guidance of $119 million to $123 million and adjusted EBITDA loss guidance of $19 million to $23 million.
- Whether international probe sales to distribution partners recover following the second-quarter decline.
Balance sheet and cash flow
- Cash and cash equivalents were $124.7 million as of June 30, 2026.
Analysis
Butterfly reported record quarterly revenue of $32.6 million, up 39% from $23.4 million in the second quarter of 2025. U.S. revenue rose 57% to $27.6 million, driven primarily by Butterfly Embedded™ partnership revenue, including the Midjourney co-development partnership, and by higher probe sales to health systems, medical schools and eCommerce customers. International revenue declined 14% year-over-year to $5.0 million because of lower probe sales to international distribution partners, partially offset by expansion into Brazil.
Profitability improved substantially despite higher spending. Gross profit increased to $23.3 million from $14.9 million, while GAAP gross margin rose to 71.4% from 63.7%. Management attributed the margin improvement to higher-margin Butterfly Embedded™ licensing revenue and lower software amortization costs. Operating expenses increased 19% to $37.0 million, and operating expenses excluding stock-based compensation and other expenses increased to $26.3 million from $23.1 million, reflecting higher headcount supporting revenue growth, product development and software development projects.
The higher revenue and gross-margin result reduced losses. Net loss was $12.9 million, compared with $13.8 million in the prior-year period, while adjusted EBITDA loss improved 78% to $1.4 million from $6.2 million. GAAP EPS was $(0.05), compared with $(0.06), and adjusted EPS was $(0.01), compared with $(0.03). Cash and cash equivalents were $124.7 million as of June 30, 2026.
The Company raised Fiscal Year 2026 guidance to revenue of $119 million to $123 million, or approximately 22% to 26% growth, and an adjusted EBITDA loss of $19 million to $23 million. Third Quarter of 2026 guidance calls for revenue of $26 million to $30 million and an adjusted EBITDA loss of $6 million to $9 million. Operational milestones include two new Embedded partners, six new enterprise software agreements, provisional authorization to sell across the U.S. Department of Veterans Affairs, and planned Home & Community Care commercialization in the second half of 2026.
The central items for investors are the durability of Embedded licensing revenue and the associated gross-margin benefit, the recovery trajectory for international distribution sales, and progress on the stated third-quarter FedRAMP certification target. Management also expects three existing Butterfly Garden™ partner tools to become commercially available by year-end and expects Home & Community Care revenue in the fourth quarter.
Management, verbatim
Butterfly delivered another outstanding quarter, exceeding the high end of our guidance while achieving record revenue, gross margin and adjusted EBITDA.
Joseph DeVivo, President, Chief Executive Officer and Chairman
Together, these growth engines reinforce one another and continue to expand our long-term opportunity.
Joseph DeVivo, President, Chief Executive Officer and Chairman
Not in the filing
stated, not guessed- GAAP operating income or loss
- Adjusted gross profit
- Adjusted gross margin
- Prior-quarter comparisons for reported metrics
- Operating cash flow
- Free cash flow
- Debt balance
- Capital returns, including share repurchases and dividends
- Gross-margin guidance
- Operating-expense guidance
- Tax-rate guidance
- Prior-period guidance for comparison
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.
Background
This is an SEC Form 8-K (Item 2.02) with Butterfly Network’s Q2 2026 results and updated FY and Q3 guidance.
Ticker impact
Butterfly Network reported Q2 revenue of $32.6M (+39% YoY), raised FY 2026 revenue to $119M-$123M, and improved adjusted EBITDA loss guidance.
Likely positive near-term bias as guidance upgrades and higher gross margin support earnings expectations, with follow-through risk around FedRAMP timing and commercialization milestones.
The filing is a primary earnings/guidance disclosure with multiple quantified upgrades (revenue and adjusted EBITDA) plus concrete operational catalysts (FedRAMP provisional authorization, Brazil authorization, first commercial implementation timing).
Market effects
Supports sentiment for ultrasound hardware and AI-enabled point-of-care platforms, especially companies positioning toward enterprise software and government procurement.
Brazil regulatory authorization may improve perceived growth optionality in international ultrasound demand.
FedRAMP progress and embedded-partner expansion reinforce US government and partner ecosystem narratives that can influence broader medtech software adoption sentiment.
Counterpoint
Despite guidance raises, the company still reports net loss and adjusted EBITDA loss, so upside may be limited if operating expense growth outpaces revenue conversion.
Key entities
- issuerButterfly Network, Inc.
Reports Q2 2026 financial results and raises FY 2026 revenue and adjusted EBITDA loss guidance; highlights FedRAMP progress and Brazil regulatory authorization.
- regulatory_programFedRAMP
US government cloud security authorization pathway; company received provisional authorization and targets certification in Q3 2026.
- partnerVCOM
Medical education partner referenced for a long-term strategic partnership to support physician training transitions.
