Kestra Medical 2026 Q2 Earnings Revenue Surges 53% but Losses Widen

Kestra Medical (KMTS) reported fiscal 2026 Q2 earnings on Dec 11, 2025, with revenue rising 53.4% to $22.57 million, surpassing expectations by $1.6 million. However, GAAP EPS of -$0.64 missed estimates by $0.05, while the net loss widened to $32.78 million (59.0% increase YoY). The company raised FY26 revenue guidance to $91 million, reflecting strong prescription growth and margin expansion.

Revenue

Total revenue surged to $22.57 million in Q2 2026, a 53.4% increase from $14.71 million in Q2 2025. This growth was driven by 54% higher prescriptions for the Assure system, a 50.6% gross margin milestone, and a 100 active sales territories expansion.

Earnings/Net Income

Kestra narrowed its per-share loss to $0.64 in Q2 2026 from $1.19 in Q2 2025 (46.2% improvement). However, the net loss widened to $32.78 million, up 59.0% from $20.62 million in the prior year. The EPS shortfall highlights ongoing profitability challenges despite top-line growth.

Price Action

The stock price rose 1.14% in the latest trading day and 1.67% for the week, but declined 5.72% month-to-date.

Post-Earnings Price Action Review

A strategy of purchasing Kestra shares on revenue raise announcements and holding for 30 days generated a 10.21% cumulative return over three years, with an average annual return of 3.40%. While the Q2 2026 revenue beat spurred an 11% one-day price jump, the stock’s 34.77% 90-day gain and 10.21% year-to-date return remain volatile. The high price-to-sales ratio of 18.6 underscores sensitivity to future earnings misses or product scaling setbacks. Investors must balance modest returns against risks from ongoing losses and valuation challenges.

CEO Commentary

Brian Webster, President and CEO, emphasized 53% revenue growth to $22.6 million, driven by 54% prescription growth and 50.6% gross margin. Strategic priorities include expanding sales territories to 100 active, enhancing in-network payer coverage (80%+ mix), and leveraging clinical evidence from the ACE-PAS study to influence guideline updates. Webster noted the WCD market’s “low double-digit” growth acceleration and Kestra’s “strong execution across all elements of the business.”

Guidance

Kestra raised FY26 revenue guidance to $91 million (52% growth vs. FY25), up from prior $88 million. The company targets “70% plus margins over the next few years” and reiterated confidence in operating leverage through scale. Updated guidance reflects a “run-rate business” model with disciplined commercial expansion to “establish trust with investors.”

Additional News

Kestra appointed Timothy Moran as Chief Business Officer to strengthen leadership for growth. The company closed a $148 million public offering on Dec 4, 2025, bolstering its $175 million cash balance. Additionally, Kestra showcased its Cardiac Recovery System platform at the 2025 Heart Failure Society of America conference, highlighting innovations in sudden cardiac arrest risk management.