Kestra Medical Technologies (KMTS) Q1 2027 earnings summary

Executive summary

• Revenue for Q1 FY27 grew 60% year-over-year to $31.0 million, driven by market expansion, increased patient adoption, and improved revenue cycle management.

• Gross margin expanded to 56.5%, up from 45.7% year-over-year, reflecting improved utilization, higher in-network patient mix, and cost efficiencies.

• Net loss widened to $44.1 million from $25.8 million in the prior year, primarily due to higher operating expenses and a $6.3 million loss on extinguishment of debt.

• Continued investments in technology, AI, automation, commercial expansion, R&D, and infrastructure to drive growth, efficiency, and scalability.

• Commercial team productivity increased, with new reps ramping faster and deeper account penetration through territory splits.

Financial highlights

• Q1 revenue reached $31.0 million, a 60% year-over-year increase, with gross profit rising to $17.5 million.

• Gross margin improved to 56.5% from 45.7% year-over-year, driven by higher in-network patient mix and cost improvements.

• GAAP operating expenses were $55.2 million, with adjusted OpEx at $44.2 million; R&D expense as a percentage of revenue was 22%.

• Net loss was $44.1 million, with adjusted EBITDA loss at $24.0 million.

• Cash, cash equivalents, and investments totaled $244.7 million as of July 31, 2026; total liquidity including term loan was ~$320 million.

Outlook and guidance

• FY 2027 revenue guidance raised to $141 million, representing 48% growth over FY 2026 and up from prior guidance of $137 million.

• Guidance increase reflects confidence in KPIs: prescription growth, in-network mix, and RCM improvements.

• Expect stronger revenue acceleration in the second half of FY 2027 as new reps ramp up.

• Gross margin target increased to mid-70% over the next few years, up from prior 70% outlook.

• OpEx for FY 2027 expected at $220 million, with R&D spend returning to historical 5%-7% range in H2.