Kestra Medical 2026 Q2 Earnings Revenue Surpasses Estimates Despite Wider Loss

Kestra Medical (KMTS) reported fiscal 2026 Q2 earnings on Dec 11th, 2025. The company’s results reflect strong revenue growth but persistent losses, with guidance raised for the year.

Kestra Medical (KMTS) reported Q2 2026 earnings with revenue of $22.57 million, surpassing estimates by $1.6 million, while GAAP EPS of -$0.64 missed by $0.05. The company raised FY2026 revenue guidance to $91 million, up from $88 million, reflecting strong demand and operational improvements.

Revenue

The total revenue of Kestra Medical increased by 53.4% to $22.57 million in 2026 Q2, up from $14.71 million in 2025 Q2.

Earnings/Net Income

Kestra Medical narrowed losses to $0.64 per share in 2026 Q2 from a loss of $1.19 per share in 2025 Q2 (46.2% improvement). Meanwhile, the company's net loss widened to $-32.78 million in 2026 Q2, representing a 59.0% increase from the $-20.62 million loss recorded in 2025 Q2. While EPS showed a 46.2% improvement, the net loss widened by 59.0%, highlighting ongoing operational challenges.

Price Action

The stock price of Kestra Medical has edged up 1.14% during the latest trading day, has edged up 1.67% during the most recent full trading week, and has dropped 5.72% month-to-date.

Post-Earnings Price Action Review

The strategy of buying Kestra Medical (KMTS) shares after a revenue raise quarter-over-quarter on the financial report release date and holding for 30 days resulted in poor performance over the past three years. The strategy had a CAGR of -3.40% with a maximum drawdown of 0.00% and a Sharpe ratio of -0.05, indicating significant underperformance and risk compared to the benchmark, which had a CAGR of 20.18% and a maximum drawdown of 65.82%.

CEO Commentary

Brian Webster, President and Chief Executive Officer, highlighted Kestra’s strong Q2 performance, noting 53% year-over-year revenue growth to $22.6 million and a historic gross margin of 50.6%, up 11 points YoY. He emphasized the Assure system’s clinical differentiation, citing the ACE-PASS study’s validation of its safety, wear time (23.1 hours), and low false alarm rate. Strategic priorities include expanding the sales force (100 active territories, up from 80 in FY2025) and improving in-network payer coverage (now low 80s). Webster expressed optimism about the WCD market’s acceleration to low double-digit growth and Kestra’s path to 70%+ gross margins. He underscored investments in clinical evidence, commercial expansion, and leveraging ACE-PASS data to influence guideline updates.

Guidance

Kestra raised FY2026 revenue guidance to $91 million (from $88 million), driven by prescription volume growth, higher in-network mix, and RCM improvements. The CEO affirmed confidence in continued gross margin expansion, targeting 70%+ margins “over the next few years,” and reiterated the WCD market’s potential to grow into a multi-billion-dollar sector. Quantitative targets include maintaining 50%+ revenue growth and achieving operating leverage through scale.

Additional News

Kestra Medical appointed Timothy Moran as Chief Business Officer, strengthening its leadership team for the next growth phase. The company is scheduled to present at the Stifel 2025 Healthcare Conference, focusing on strategic initiatives and market expansion. Additionally, Kestra showcased its Cardiac Recovery System Platform at the HFSA 2025 conference, highlighting advancements in sudden cardiac arrest risk management. These developments underscore the company’s commitment to innovation and market visibility.