Outset Medical Reports First-Quarter Results
First Quarter and Recent Highlights
- Net revenue totaled
$27.9 million , a decrease of 6% compared to$29.8 million in the first quarter of 2025. - Recurring revenue consisting of Tablo consumables and services was
$22.5 million , roughly even with the prior-year period. - Gross margin expanded by more than 600 basis points over the prior-year period to 43.4% (43.8% on a non-GAAP basis). Product gross margin of 52.4% and service and other gross margin of 26.7% were record highs.
- Net cash used during the quarter of
$12 million was less than previously forecasted, resulting in a strong cash position, including restricted cash, cash equivalents and short-term investments, of$161 million at quarter-end.
“We delivered a solid first quarter and continued to make meaningful progress on our path to profitability, driven by disciplined execution and another quarter of record gross margin performance,” said
First Quarter 2026 Financial Results
Revenue for the first quarter was
Gross profit of
Operating expenses of
Excluding stock-based compensation expense and litigation charges, non-GAAP operating expenses were
Net loss was
Total cash, including restricted cash, cash equivalents and short-term investments, was
2026 Financial Guidance
Outset reiterated its 2026 revenue guidance of
Webcast and Conference Call Details
Outset will host a conference call today,
Use of Non-GAAP Financial Measures
The Company may report non-GAAP results for gross profit/loss, gross margin, operating expenses, operating margins, net income/loss, basic and diluted net income/loss per share, other income/loss, and cash flows. These non-GAAP financial measures are in addition to, and not a substitute for, or superior to, financial measures calculated in accordance with GAAP. As listed in the itemized reconciliations between GAAP and non-GAAP financial measures included in this press release, the Company’s GAAP financial measures include stock-based compensation expense and litigation charges incurred outside of the ordinary course of business in connection with the stockholder class action and relative derivative lawsuits as disclosed in the Company’s latest annual and quarterly reports. Stock-based compensation is a non-cash expense. In addition, litigation charges related to the above-described matters are excluded because they constitute non-routine litigation costs, arise outside of the ordinary course of the Company’s business, and are not indicative of its recurring operating results or underlying performance trends. As such, management has excluded the effects of these items in non-GAAP measures to assist investors in analyzing and assessing past and future operating performance and period-to-period comparisons. There are limitations related to the use of non-GAAP financial measures because they are not prepared in accordance with GAAP, may exclude significant expenses required by GAAP to be recognized in the Company’s financial statements, and may not be comparable to non-GAAP financial measures used by other companies. The Company encourages investors to carefully consider its results under GAAP, as well as its supplemental non-GAAP information and the reconciliation between these presentations, to more fully understand its business. Reconciliations between GAAP and non-GAAP results are presented in the Appendix A of this press release.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are forward-looking statements. Forward-looking statements are based on management’s current assumptions and expectations of future events and trends, which affect or may affect the Company’s business, strategy, operations or financial performance, and actual results and other events may differ materially from those expressed or implied in such statements due to numerous risks and uncertainties. Forward-looking statements include, but are not limited to, statements about the Company’s possible or assumed future results of operations and financial position, including expectations regarding projected revenues, gross margin, operating expenses, capital expenditures, cash use, cash burn, cash position, profitability and outlook; statements about the sufficiency of the Company’s cash balances through cashflow breakeven; statements regarding the anticipated impacts and benefits of the Company’s cost reduction actions, initiatives to optimize the commercial organization and improve forecasting and order visibility, and restructurings; statements regarding anticipated customer orders or other business opportunities including the expected size, closing and timing thereof; statements regarding the Company’s overall business strategy, plans and objectives of management; statements regarding the anticipated launch and timing of product enhancements and new features, as well as new or expanded services, and the expected benefits, performance, and impact thereof; the Company’s expectations regarding the market sizes and growth potential for Tablo and the total addressable market opportunities for Tablo; continued execution of the Company’s initiatives designed to expand gross margins; the Company’s ability to respond to and resolve any reports, observations or other actions by the
About
Outset is a medical technology company transforming the dialysis experience across the continuum of care with a first-of-its-kind technology. The Tablo® Hemodialysis System, FDA-cleared for use from hospital to home, is trusted by more than 1,000
Investor Contact
Investors@outsetmedical.com
Condensed Statements of Operations (in thousands, except per share amounts) (unaudited) |
||||||||||
| Three Months Ended | ||||||||||
| 2026 | 2025 | |||||||||
| Revenue: | ||||||||||
| Product revenue | $ | 18,550 | $ | 21,294 | ||||||
| Service and other revenue | 9,313 | 8,458 | ||||||||
| Total revenue | 27,863 | 29,752 | ||||||||
| Cost of revenue: | ||||||||||
| Cost of product revenue(2) | 8,833 | 11,002 | ||||||||
| Cost of service and other revenue | 6,935 | 7,684 | ||||||||
| Total cost of revenue | 15,768 | 18,686 | ||||||||
| Gross profit(1) | 12,095 | 11,066 | ||||||||
| Gross margin(1) | 43.4 | % | 37.2 | % | ||||||
| Operating expenses: | ||||||||||
| Research and development(2) | 5,618 | 5,515 | ||||||||
| Sales and marketing(2) | 13,279 | 13,652 | ||||||||
| General and administrative(2)(3) | 10,117 | 8,298 | ||||||||
| Total operating expenses | 29,014 | 27,465 | ||||||||
| Loss from operations | (16,919 | ) | (16,399 | ) | ||||||
| Interest income and other income, net | 1,527 | 1,976 | ||||||||
| Interest expense | (3,369 | ) | (3,560 | ) | ||||||
| Loss on extinguishment of term loan | — | (7,685 | ) | |||||||
| Loss before provision for income taxes | (18,761 | ) | (25,668 | ) | ||||||
| Provision for income taxes | 217 | 115 | ||||||||
| Net loss | $ | (18,978 | ) | $ | (25,783 | ) | ||||
| Net loss per share, basic and diluted | $ | (1.03 | ) | $ | (3.66 | ) | ||||
| Shares used in computing net loss per share, basic and diluted | 18,373 | 7,038 | ||||||||
| (1) Gross profit and gross margin by source consisted of the following: | ||||||||||
| Three Months Ended | ||||||||||
| 2026 | 2025 | |||||||||
| Gross profit | ||||||||||
| Product revenue | $ | 9,717 | $ | 10,292 | ||||||
| Service and other revenue | 2,378 | 774 | ||||||||
| Total gross profit | $ | 12,095 | $ | 11,066 | ||||||
| Gross margin | ||||||||||
| Product revenue | 52.4 | % | 48.3 | % | ||||||
| Service and other revenue | 25.5 | % | 9.2 | % | ||||||
| Total gross margin | 43.4 | % | 37.2 | % | ||||||
| (2) Includes stock-based compensation expense as follows: | ||||||||||
| Three Months Ended | ||||||||||
| Stock-based compensation expense | ||||||||||
| 2026 | 2025 | |||||||||
| Cost of revenue | $ | 111 | $ | 117 | ||||||
| Research and development | 820 | 559 | ||||||||
| Sales and marketing | 458 | 479 | ||||||||
| General and administrative | 2,064 | 1,822 | ||||||||
| Total stock-based compensation expense | $ | 3,453 | $ | 2,977 | ||||||
| (3) Includes non-ordinary course litigation charges related to stockholder class action and related derivative lawsuits as follows: | ||||||||||
| Three Months Ended | ||||||||||
| Litigation charges | ||||||||||
| 2026 | 2025 | |||||||||
| General and administrative | $ | 112 | $ | — | ||||||
| Total litigation charges | $ | 112 | $ | — | ||||||
Condensed Balance Sheets (in thousands, except per share amounts) |
||||||||
| 2026 | 2025 | |||||||
| (unaudited) | ||||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 30,562 | $ | 35,006 | ||||
| Short-term investments | 126,144 | 133,940 | ||||||
| Accounts receivable, net | 25,322 | 28,329 | ||||||
| Inventories | 49,650 | 47,609 | ||||||
| Prepaid expenses and other current assets | 5,031 | 5,999 | ||||||
| Total current assets | 236,709 | 250,883 | ||||||
| Restricted cash | 3,829 | 3,829 | ||||||
| Property and equipment, net | 4,073 | 4,670 | ||||||
| Operating lease right-of-use assets | 4,410 | 4,797 | ||||||
| Finance lease right-of-use assets | 80 | — | ||||||
| Other assets | 353 | 317 | ||||||
| Total assets | $ | 249,454 | $ | 264,496 | ||||
| Liabilities and stockholders' equity | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 1,440 | $ | 554 | ||||
| Accrued compensation and related benefits | 8,754 | 10,735 | ||||||
| Accrued expenses and other current liabilities | 11,599 | 9,433 | ||||||
| Accrued warranty liability | 1,352 | 1,374 | ||||||
| Deferred revenue, current | 12,641 | 13,795 | ||||||
| Operating lease liabilities, current | 1,795 | 1,739 | ||||||
| Finance lease liabilities, current | 26 | — | ||||||
| Total current liabilities | 37,607 | 37,630 | ||||||
| Deferred revenue | 366 | 406 | ||||||
| Operating lease liabilities | 2,797 | 3,271 | ||||||
| Finance lease liabilities | 59 | — | ||||||
| Term loan | 96,937 | 96,237 | ||||||
| Total liabilities | 137,766 | 137,544 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders' equity: | ||||||||
| Preferred Stock, |
— | — | ||||||
| Common stock, |
18 | 18 | ||||||
| Additional paid-in capital | 1,302,097 | 1,298,138 | ||||||
| Accumulated other comprehensive income | (73 | ) | 172 | |||||
| Accumulated deficit | (1,190,354 | ) | (1,171,376 | ) | ||||
| Total stockholders' equity | 111,688 | 126,952 | ||||||
| Total liabilities and stockholders' equity | $ | 249,454 | $ | 264,496 | ||||
Condensed Statements of Cash Flows (in thousands) (unaudited) |
||||||||
| Three Months Ended |
||||||||
| 2026 | 2025 | |||||||
| Net cash used in operating activities | $ | (12,844 | ) | $ | (25,663 | ) | ||
| Net cash provided by (used in) investing activities | 7,899 | (78,079 | ) | |||||
| Net cash provided by financing activities | 501 | 55,656 | ||||||
| Net decrease in cash, cash equivalents and restricted cash | (4,444 | ) | (48,086 | ) | ||||
| Cash, cash equivalents and restricted cash at beginning of the period | 38,835 | 127,343 | ||||||
| Cash, cash equivalents and restricted cash at end of the period(1) | $ | 34,391 | $ | 79,257 | ||||
| (1) The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the accompanying condensed balance sheets that sum to the total of the amounts shown in the accompanying condensed statements of cash flows (in thousands): | ||||||||
| 2026 | 2025 | |||||||
| Cash and cash equivalents | $ | 30,562 | $ | 75,928 | ||||
| Restricted cash | 3,829 | 3,329 | ||||||
| Total cash, cash equivalents and restricted cash* | $ | 34,391 | $ | 79,257 | ||||
| * The total cash, including restricted cash, cash equivalents and investment securities as of |
||||||||
| Appendix A | ||||||||||
Results of Operations – Non-GAAP (in thousands, except per share amounts) (unaudited) |
||||||||||
| Reconciliation between GAAP and non-GAAP net loss per share: | ||||||||||
| Three Months Ended | ||||||||||
| 2026 | 2025 | |||||||||
| GAAP net loss per share, diluted | $ | (1.03 | ) | $ | (3.66 | ) | ||||
| Stock-based compensation expense | 0.19 | 0.42 | ||||||||
| Litigation charges | 0.01 | — | ||||||||
| Non-GAAP net loss per share, diluted | $ | (0.83 | ) | $ | (3.24 | ) | ||||
| Reconciliation between GAAP and non-GAAP net loss: | ||||||||||
| Three Months Ended | ||||||||||
| 2026 | 2025 | |||||||||
| GAAP net loss, diluted | $ | (18,978 | ) | $ | (25,783 | ) | ||||
| Stock-based compensation expense | 3,453 | 2,977 | ||||||||
| Litigation charges | 112 | — | ||||||||
| Non-GAAP net loss, diluted | $ | (15,413 | ) | $ | (22,806 | ) | ||||
| Reconciliation between GAAP and non-GAAP results of operations: | ||||||||||
| Three Months Ended | ||||||||||
| 2026 | 2025 | |||||||||
| GAAP gross profit | $ | 12,095 | $ | 11,066 | ||||||
| Stock-based compensation expense | 111 | 117 | ||||||||
| Non-GAAP gross profit | $ | 12,206 | $ | 11,183 | ||||||
| GAAP gross margin | 43.4 | % | 37.2 | % | ||||||
| Stock-based compensation expense | 0.4 | 0.4 | ||||||||
| Non-GAAP gross margin | 43.8 | % | 37.6 | % | ||||||
| GAAP research and development expense | $ | 5,618 | $ | 5,515 | ||||||
| Stock-based compensation expense | (820 | ) | (559 | ) | ||||||
| Non-GAAP research and development expense | $ | 4,798 | $ | 4,956 | ||||||
| GAAP sales and marketing expense | $ | 13,279 | $ | 13,652 | ||||||
| Stock-based compensation expense | (458 | ) | (479 | ) | ||||||
| Non-GAAP sales and marketing expense | $ | 12,821 | $ | 13,173 | ||||||
| GAAP general and administrative expense | $ | 10,117 | $ | 8,298 | ||||||
| Stock-based compensation expense | (2,064 | ) | (1,822 | ) | ||||||
| Litigation charges | (112 | ) | — | |||||||
| Non-GAAP general and administrative expense | $ | 7,941 | $ | 6,476 | ||||||
| GAAP total operating expense | $ | 29,014 | $ | 27,465 | ||||||
| Stock-based compensation expense | (3,342 | ) | (2,860 | ) | ||||||
| Litigation charges | (112 | ) | — | |||||||
| Non-GAAP total operating expense | $ | 25,560 | $ | 24,605 | ||||||
Source: Outset Medical, Inc.