Butterfly Network Reports 4.5% Revenue Growth to $21.5 Million in Q3 2025

Butterfly Network, Inc. reported its financial results for the third quarter of 2025, revealing total revenue of $21.5 million, a 4.5% increase from $20.6 million in the same period last year. The revenue growth was primarily driven by a 7.5% increase in product sales, which reached $14.6 million, attributed to higher average selling prices and increased sales volume in international markets. However, revenue from software and other services decreased slightly by 1.3% to $6.9 million, reflecting lower renewals of individual subscriptions and reduced revenue from extended warranties.

The company's cost of revenue surged significantly, totaling $25.2 million for the quarter, compared to $8.3 million in the prior year, marking a 203.1% increase. This rise was largely due to a non-recurring charge of $17.4 million for excess and obsolete inventory, which accounted for 80.8% of the total revenue for the quarter. Consequently, Butterfly reported a gross loss of $3.8 million, a stark contrast to the gross profit of $12.2 million recorded in the same quarter of 2024.

Operating expenses for the third quarter totaled $31.4 million, up from $29.5 million a year earlier. The increase was driven by higher sales and marketing expenses, which rose by 10.6% to $10.6 million, reflecting investments in the sales force and client experience. Research and development expenses remained relatively stable at $8.7 million, while general and administrative expenses slightly decreased to $9.3 million. The net loss for the quarter was $34.0 million, compared to a loss of $16.9 million in the prior year, resulting in a net loss per share of $0.13.

In terms of operational metrics, Butterfly reported a 4.7% increase in units fulfilled, totaling 4,921 devices for the quarter, driven by higher probe sales in the U.S. market. The company also noted a decrease in the software and other services mix as a percentage of total revenue, which fell to 32.3% from 34.2% in the previous year, indicating a shift towards hardware sales. As of September 30, 2025, Butterfly had cash and cash equivalents of $144.2 million, bolstered by a public offering in January that raised $81.0 million.

Looking ahead, Butterfly Network aims to continue investing in its business to drive revenue growth while managing operational costs. The company expects that its existing cash and cash flows will be sufficient to meet its liquidity needs for at least the next 12 months. However, it remains cautious about market conditions and the potential impact of technological advancements on its inventory and product offerings.