DarioHealth 2025 Q2 Earnings Deepened Losses Despite Revenue Stabilization

DarioHealth reported its fiscal 2025 Q2 earnings on August 12, 2025. The results reflect continued financial strain despite some operational stability. The company missed expectations across key metrics, with a significant increase in per-share losses and a modest reduction in net losses compared to the same period in the prior year.

Revenue
DarioHealth’s total revenue for Q2 2025 fell by 14.2% year-over-year to $5.37 million from $6.25 million in the prior-year quarter. The decline was primarily attributed to a decrease in consumer hardware sales, which accounted for $1.71 million, while services revenue totaled $3.66 million. There was no amortization of acquired intangible assets during the quarter.

Earnings/Net Income
DarioHealth’s losses widened on a per-share basis, with a loss of $0.18 per share in Q2 2025, up from $0.08 in Q2 2024, marking a 125% increase in per-share losses. However, the company’s net loss narrowed slightly to $-12.99 million for Q2 2025, compared to $-13.61 million in the same quarter of the previous year, representing a 4.6% reduction. Despite this, DarioHealth has now recorded losses in 11 consecutive years during the corresponding period, underscoring ongoing financial challenges.

Price Action
Shares of DarioHealth have experienced continued downward pressure. On the most recent trading day, the stock dropped 4.82%, while it fell 19.20% during the past full week. Month-to-date, it has plunged 40.43%, reflecting investor pessimism.

Post-Earnings Price Action Review
A strategy of buying DarioHealth shares following a quarter with improved revenue and holding for 30 days has historically underperformed. This approach recorded a return of -89.85%, significantly below a benchmark return of 46.32%, with an excess return of -136.17% and a compound annual growth rate (CAGR) of -54.60%. Over a three-year period, the strategy delivered a maximum drawdown of 0.00% and a Sharpe ratio of -0.54, highlighting poor risk-adjusted performance and high volatility.

CEO Commentary
Erez Raphael, CEO of DarioHealth, expressed confidence in the strategic value of the recent Twill acquisition, calling it an “incredible opportunity” to build a leading digital health platform. He emphasized that the combined entity is expected to nearly double its 2023 pro forma revenue and achieve gross margins of 80–85% by 2025. Raphael also highlighted anticipated annualized cost synergies of nearly 30% within two years and projected that these improvements, along with revenue scale and margin expansion, will accelerate the path to profitability within two years of the acquisition.

Guidance
DarioHealth expects the Twill acquisition to catalyze significant growth, with the combined entity positioned to leverage improved gross margins and cost synergies to drive long-term profitability. The company remains focused on integrating Twill’s operations and talent, citing shared values and goals that are expected to enhance growth momentum.

Additional News
On August 12, 2025, DarioHealth announced the acquisition of Twill, a move it described as a strategic milestone in building an unrivaled digital health platform. The acquisition is expected to nearly double pro forma 2023 revenue, with gross margins anticipated to reach 80–85% by 2025. DarioHealth also expects to realize nearly 30% in annualized cost synergies within two years post-acquisition, with the combination of revenue scale, margin improvements, and cost reductions expected to accelerate the path to profitability within two years. This marks one of the most significant business developments for the company in recent quarters.