Kestra Medical Technologies Reports First Quarter Fiscal 2026 Financial Results

Rhea-AI Summary

Kestra Medical Technologies (Nasdaq: KMTS) reported strong Q1 FY26 financial results, with revenue reaching $19.4 million, a 52% increase year-over-year. The wearable medical device company saw significant growth with 4,205 prescriptions written for its ASSURE® system, up 51% from the previous year. Gross margin expanded to 45.7% from 32.9% year-over-year.

The company raised its FY26 revenue guidance to $88 million, representing 47% growth compared to FY25, up from previous guidance of $85 million. Despite strong top-line growth, Kestra reported a GAAP net loss of $25.8 million and held cash and equivalents of $201.2 million as of July 31, 2025.

Positive

• Revenue grew 52% year-over-year to $19.4 million
• Gross margin significantly expanded to 45.7% from 32.9%
• Prescriptions for ASSURE® system increased 51% to 4,205
• Raised FY26 revenue guidance to $88 million
• Strong cash position of $201.2 million

Negative

• GAAP net loss increased to $25.8 million from $20.3 million year-over-year
• Operating expenses rose significantly to $37.7 million from $22.6 million
• Adjusted EBITDA loss widened to $19.4 million from $15.7 million

Insights

Financial Analyst

Kestra posted impressive 52% revenue growth, expanded margins to 45.7%, and raised FY26 guidance, showing strong commercial execution despite continued losses.

Kestra's Q1 FY26 results demonstrate exceptional commercial momentum with $19.4 million in revenue, representing 52% year-over-year growth. This outperformance was driven by their ASSURE® wearable defibrillator system, which saw prescriptions increase by 51% to 4,205 units. The company is successfully expanding both market share with existing customers while activating new accounts.

The gross margin expansion from 32.9% to 45.7% is particularly impressive, reflecting both volume leverage and a more favorable payer mix with a higher proportion of in-network patients. This 12.8% margin improvement directly contributed to gross profit more than doubling from $4.2 million to $8.9 million.

Despite the strong top-line performance, Kestra remains deeply unprofitable with a GAAP net loss of $25.8 million and an adjusted EBITDA loss of $19.4 million. Operating expenses increased significantly to $37.7 million, which included $2.9 million in non-recurring public company costs. Even excluding these one-time expenses, core operating expenses grew substantially to $30.3 million as the company invests heavily in commercial and revenue cycle resources.

Management's confidence is evident in their raised revenue guidance for FY26 from $85 million to $88 million, projecting 47% annual growth. With $201.2 million in cash, Kestra has approximately 2.5 years of runway at the current burn rate to achieve profitability or secure additional funding.

The wearable defibrillator market appears to be responding positively to Kestra's ASSURE® system, but investors should carefully monitor the path to profitability as the company balances aggressive commercial expansion with improving operational efficiency.

KIRKLAND, Wash., Sept. 11, 2025 (GLOBE NEWSWIRE) -- Kestra Medical Technologies, Ltd. (Nasdaq: KMTS), a wearable medical device and digital healthcare company, today reported financial results for the first quarter fiscal 2026, which ended July 31, 2025.

Financial Highlights

• Generated revenue of $19.4 million in Q1 FY26, an increase of 52% compared to the prior year period.
• Expanded gross margin to 45.7% in Q1 FY26 compared to 32.9% in the prior year period.
• Increased FY26 revenue guidance to $88 million, representing growth of 47% compared to FY25.
  

“We had a strong start to fiscal 2026, with our sustained commercial momentum generating revenue growth of over 50% in the first quarter,” said Brian Webster, President and CEO. “We also continued to make progress on several key operational objectives, including growing the commercial organization, enhancing our revenue cycle management capabilities, and expanding gross margin. As we progress on our journey to category leadership, we remain focused on both market share capture and growing the wearable defibrillator market, while executing on our commitments to patients and their prescribers.”

First Quarter Fiscal 2026 Financial Results

• Total revenue was $19.4 million, an increase of 52% compared to the prior year period.
  • 4,205 prescriptions were written for the ASSURE^® system, an increase of 51% compared to the prior year period.
  • Revenue growth was driven by higher market share with existing customers and activation of new accounts. Revenue also benefited from a higher mix of in-network patients and improvements in revenue cycle management capabilities.
• Gross profit was $8.9 million compared to $4.2 million in the prior year period.
  • Gross margin expanded to 45.7% compared to 32.9% in the prior year period, driven by volume leverage and a higher mix of in-network patients.
• GAAP operating expenses were $37.7 million and included $2.9 million of non-recurring new public company costs. GAAP operating expenses were $22.6 million in the prior year period.
  • Excluding non-recurring new public company costs and share-based compensation expense, operating expenses were $30.3 million in Q1 FY26. The increase was attributable to growth in expenses related to commercial and revenue cycle resources.
• GAAP net loss and comprehensive loss was $25.8 million compared to GAAP net loss and comprehensive loss of $20.3 million in the prior year period.
  • Adjusted EBITDA^* loss was $19.4 million compared to an adjusted EBITDA loss of $15.7 million in the prior year period.
• Cash and cash equivalents totaled $201.2 million as of July 31, 2025.

*Adjusted EBITDA is a non-GAAP financial measure. See “Use of Non-GAAP Financial Measures” below for additional information. A reconciliation of Adjusted EBITDA to the most directly comparable GAAP measure is included in this press release.

Fiscal Year 2026 Revenue Guidance
Kestra is increasing its FY26 revenue guidance to $88 million, representing growth of 47% compared to FY25. This compares to prior FY26 revenue guidance of $85 million.

Webcast and Conference Call
Kestra will host a conference call today at 4:30 p.m. ET to discuss first quarter fiscal 2026 financial results. A live and archived webcast of the event will be available in the “Events” section of the investor relations website.

Use of Non-GAAP Financial Measures
This press release contains certain financial information that is not presented in conformity with U.S. generally accepted accounting principles (“GAAP”), including Adjusted EBITDA. The non-GAAP financial measures are provided as supplemental information to Kestra’s financial measures presented in this press release that are calculated and presented in accordance with GAAP.

Adjusted EBITDA, which is calculated as net income (loss), as adjusted to exclude other income/expense (including interest), income tax expense (benefit), depreciation and amortization expense, share-based compensation expense, and non-recurring new public company costs, is presented because management believes it allows investors to view the Company’s performance in a manner similar to the method used by management to evaluate the Company’s performance for both strategic and annual operating planning. Management believes that in order to properly understand short-term and long-term financial trends, it is helpful for investors to understand the impact of the items excluded from the calculation of Adjusted EBITDA, in addition to considering the Company’s GAAP financial measures. The excluded items vary in frequency and/or impact on our results of operations and management believes that the excluded items are not reflective of our ongoing core business operations and financial condition. Excluding such items allows investors and analysts to compare our operating performance to other companies in our industry and to compare our period-over-period results.

The non-GAAP financial measures used by Kestra may not be the same or calculated in the same manner as those used and calculated by other companies. Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as a substitute for Kestra’s financial results prepared and reported in accordance with GAAP. We urge investors to review the reconciliation of these non-GAAP financial measures to the comparable GAAP financial measures included in this press release, and not to rely on any single financial measure to evaluate our business. A reconciliation of Adjusted EBITDA reported in this press release to the most comparable GAAP measure for the respective periods appears in the table captioned “Reconciliation of GAAP Net Income (Loss) to Adjusted EBITDA” later in this release. Within the accompanying financial tables presented, certain columns and rows may not add due to the use of rounded numbers.

Forward-Looking Statements
Except where otherwise noted, the information contained in this press release is as of September 11, 2025. Statements in this press release and on the related teleconference that express a belief, expectation or intention, as well as those that are not historical fact, are forward-looking statements. Except as required by law, the Company undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements about, among other topics, our anticipated operating and financial performance, including financial guidance and projections; business plans, strategy, goals and prospects; and expectations for our products. Given their forward-looking nature, these statements involve substantial risks, uncertainties and potentially inaccurate assumptions, and we cannot ensure that any outcome expressed in these forward-looking statements will be realized in whole or in part. You can identify these statements by the fact that they use future dates or use words such as “will,” “may,” “could,” “likely,” “ongoing,” “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “assume,” “target,” “forecast,” “guidance,” “goal,” “objective,” “aim,” “seek,” “potential,” “hope” and other words and terms of similar meaning. Kestra’s financial guidance is based on estimates and assumptions that are subject to significant uncertainties. Among the factors that could cause actual results to differ materially from past results and future plans and projected future results are the following: risks related to our limited operating history and history of net losses; our ability to successfully achieve substantial market adoption of our products; competitive pressures; our ability to adapt our manufacturing and production capacities to evolving patterns of demand, governmental actions and customer trends; product defects or complaints and related liability; our ability to obtain and maintain adequate coverage and reimbursement levels for our products; our ability to comply with changing laws and regulatory requirements and resulting costs; our dependence on a limited number of suppliers; and other risks and uncertainties, including those described under the heading “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended April 30, 2025 and other filings filed or to be filed with the U.S. Securities and Exchange Commission (“SEC”). These filings, when made, are available on the Investor Relations section of our website at https://investors.kestramedical.com/ and on the SEC’s website at https://sec.gov/.

About Kestra
Kestra Medical Technologies, Ltd. is a commercial-stage wearable medical device and digital healthcare company focused on transforming patient outcomes in cardiovascular disease using monitoring and therapeutic intervention technologies that are intuitive, intelligent, and connected. For more information, visit www.kestramedical.com.

KESTRA MEDICAL TECHNOLOGIES, LTD. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (in thousands, except share and per share amounts) (unaudited)
		Three Months Ended July 31,
		2025				2024
Revenue		$	19,371			$	12,782
Cost of revenue			10,520				8,582
Gross profit			8,851				4,200
Operating expenses:
Research and development			4,001				3,404
Selling, general and administrative			33,728				19,227
Total operating expenses			37,729				22,631
Loss from operations			(28,878	)			(18,431	)
Other expense (income):
Interest expense			1,912				1,874
Interest income			(2,167	)			(37	)
Other expense (income)			(2,830	)			48
Net loss before provision for income taxes			(25,793	)			(20,316	)
Provision for income taxes			33				7
Net loss and comprehensive loss			(25,826	)			(20,323	)
Net loss attributable to non-controlling interest			—				(439	)
Net loss and comprehensive loss attributable to Kestra Medical Technologies, Ltd.			(25,826	)			(19,884	)
Less: Undeclared preferred stock dividends			—				2,383
Net loss attributable to common shareholders, basic and diluted		$	(25,826	)		$	(22,267	)
Net loss per share attributable to common shareholders, basic and diluted		$	(0.50	)		$	(1.12	)
Weighted-average shares of common shares outstanding, basic and diluted			51,304,599				19,885,382

RECONCILIATION OF GAAP NET LOSS AND COMPREHENSIVE LOSS TO ADJUSTED EBITDA (in thousands) (unaudited)
		Three Months Ended July 31,
		2025				2024
GAAP Net loss and comprehensive loss		$	(25,826	)		$	(20,323	)
Non-GAAP Adjustments:
Interest expense			1,912				1,874
Interest income			(2,167	)			(37	)
Other expense (income)			(2,830	)			48
Provision for income taxes			33				7
Depreciation expense			2,028				2,375
Share-based compensation expense			4,579				377
Non-recurring new public company costs			2,866				—
Adjusted EBITDA		$	(19,405	)		$	(15,679	)

KESTRA MEDICAL TECHNOLOGIES, LTD. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except share and per share amounts) (unaudited)
		July 31,				April 30,
		2025				2025
Assets
Current assets
Cash and cash equivalents		$	201,214			$	237,595
Accounts receivable, net			9,246				8,081
Disposable medical equipment supplies			6,802				6,572
Prepaid expenses and other current assets			3,429				3,080
Total current assets			220,691				255,328
Right-of-use assets			2,046				2,078
Deposits			1,787				2,021
Restricted cash			334				334
Property and equipment, net			40,376				34,830
Other long-term assets			1,062				1,153
Total assets		$	266,296			$	295,744
Liabilities and Shareholders’ Equity
Current liabilities
Accounts payable		$	18,570			$	23,961
Accrued liabilities			13,650				13,829
Operating lease liabilities, current portion			36				187
Total current liabilities			32,256				37,977
Operating lease liabilities, net of current portion			3,067				3,026
Warrant liabilities			5,188				8,097
Other long-term liabilities			140				140
Long-term debt, net			41,486				41,098
Total liabilities			82,137				90,338
Commitments and contingencies
Shareholders’ equity
Common shares, $1.00 par value; 100,000,000 shares authorized as of July 31, 2025 and April 30, 2025; 51,348,656 shares issued and outstanding as of July 31, 2025 and April 30, 2025			51,349				51,349
Additional paid-in capital			678,885				674,306
Accumulated deficit			(546,075	)			(520,249	)
Total shareholders’ equity			184,159				205,406
Total liabilities and shareholders’ equity		$	266,296			$	295,744

Investor contact
Neil Bhalodkar
neil.bhalodkar@kestramedical.com

FAQ

What were Kestra Medical Technologies' (KMTS) Q1 FY26 earnings results?

Kestra reported Q1 FY26 revenue of $19.4 million (up 52% YoY), with a gross margin of 45.7%. The company posted a GAAP net loss of $25.8 million and had $201.2 million in cash and equivalents.

How many ASSURE system prescriptions did Kestra (KMTS) receive in Q1 FY26?

Kestra received 4,205 prescriptions for its ASSURE® system in Q1 FY26, representing a 51% increase compared to the prior year period.

What is Kestra Medical Technologies' (KMTS) revenue guidance for FY26?

Kestra increased its FY26 revenue guidance to $88 million, up from previous guidance of $85 million, representing 47% growth compared to FY25.

How much cash does Kestra Medical Technologies (KMTS) have?

As of July 31, 2025, Kestra had $201.2 million in cash and cash equivalents.

What drove Kestra's (KMTS) revenue growth in Q1 FY26?

Revenue growth was driven by higher market share with existing customers, activation of new accounts, a higher mix of in-network patients, and improvements in revenue cycle management.