Q2 2026 Kestra Medical Technologies Ltd Earnings Call Transcript
Key Points
- Kestra Medical Technologies Ltd (KMTS) reported a 53% increase in revenue for the second quarter, reaching $22.6 million, driven by a 54% year-over-year increase in prescriptions.
- The company's gross margin surpassed 50% for the first time, marking the eighth consecutive quarter of sequential gross margin expansion.
- The Assure system met both primary endpoints in the ACEPASS study, demonstrating its safety and effectiveness, and had the highest wear time of any US WCD trial.
- KMTS is expanding its sales organization, increasing active sales territories from 80 to approximately 100, to further penetrate existing accounts and target new prescribers.
- The company has improved its revenue cycle management capabilities, with the in-network mix increasing to the low 80s, enhancing efficiency and positively impacting financial metrics.
- Despite strong revenue growth, Kestra Medical Technologies Ltd (KMTS) reported a GAAP net loss of $32.8 million for the second quarter, compared to a $20.6 million loss in the prior year period.
- Operating expenses increased to $43.2 million, up from $25 million in the prior year period, driven by investments in commercial expansion and public company costs.
- The WCD therapy remains underutilized, reaching only 14% of the eligible US addressable market, indicating a significant gap in market penetration.
- The company faces challenges in bringing more regional and local payers under contract, with over 3,000 payers in the United States.
- Kestra Medical Technologies Ltd (KMTS) relies on a leased business model, requiring substantial investment in its fleet of devices, which could impact cash flow and capital allocation.
Good afternoon and welcome to Kestra Medical Technologies second quarter fiscal 2026 earnings call. This conference call is being recorded for replay purposes. We will be facilitating a question answer session following prepared remarks from management.
(Operator Instructions) I would now like to turn the call over to Neil Bhalodkar, Vice President of Investor Relations, for introductory comments.
Thank you, Victor.
Thank you for joining Kestra's second quarter fiscal 2026 earnings call. With me today are Brian Webster, President and Chief Executive Officer, and Vaseem Mahboob, Chief Financial Officer. This call includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.
Statements made on this call that do not relate to matters of historical fact should be considered forward-looking statements. These statements are based on Kestra's current expectations, forecasts, and assumptions, which are
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