Heartflow, Inc. (HTFL)·Q3 2025 Earnings Summary

Executive Summary

• Q3 2025 revenue was $46.3M, up 41% YoY, and beat Wall Street consensus ($41.96M) by ~$4.3M; non-GAAP EPS of ($0.27) missed consensus of ($0.24) by $0.03. Revenue strength was driven by U.S. FFRCT adoption and expanding installed base, while EPS was pressured by non-cash warrant revaluation and debt extinguishment charges. *
• Gross margin expanded to 76.5% GAAP (76.8% non-GAAP), reflecting volume leverage and production efficiency; management expects Q4 gross margins similar to Q3 and remains confident in the long-term path to ≥80%.
• 2025 revenue guidance was initiated at $173.0–$173.5M (≈37.5–38.0% YoY growth), anchored by durable FFRCT adoption; management reiterated cash flow profitability within three years of the IPO.
• Strategic catalysts: UnitedHealthcare and Cigna coverage for Plaque Analysis (now 57% of U.S. covered lives), FDA clearance and launch of next-gen Plaque Analysis, and strong interest in CT-guided PCI Navigator slated for 2026 launch; however, management does not expect material Plaque revenues until late 2026.

What Went Well and What Went Wrong

What Went Well

• Strong top-line growth (+41% YoY) and volume momentum (+48% YoY revenue cases, +7% sequential), driven by U.S. FFRCT utilization and rapid installed base expansion. “Durable growth in our FFRCT business... drove third quarter total revenue up 41% year-over-year.”
• Margin execution: Gross margin expanded to 76.5% GAAP / 76.8% non-GAAP, with gains attributable to volume leverage and production efficiency; management expects Q4 margins similar to Q3 and sees a pathway to 80%+.
• Strategic progress: Next-gen Plaque Analysis received FDA clearance and launched; commercial coverage advances (UnitedHealthcare, Cigna) pushed Plaque coverage to 57% of U.S. lives; PCI Navigator introduced to strong clinician interest.

What Went Wrong

• EPS headwinds: GAAP net loss of ($50.9M) and GAAP EPS ($1.04) were impacted by a $32.1M non-cash warrant liability remeasurement, a $6.4M debt extinguishment loss, partially offset by a $4.8M derivative liability benefit. Non-GAAP EPS was ($0.27).
• Consensus EPS miss: Non-GAAP EPS of ($0.27) fell short of Wall Street consensus of ($0.24); Adjusted EBITDA of ($9.8M) also trailed consensus. *
• Plaque revenue timing: Despite coverage momentum, management guided that material Plaque adoption is unlikely until late 2026, requiring further coverage (≥70% lives) and physician education; this delays the “second wave” revenue contribution.

Financial Results

Quarterly Trend (oldest → newest)

Values with an asterisk were retrieved from S&P Global.*

Q3 2025 Actual vs Consensus

Values with an asterisk were retrieved from S&P Global.*

Segment Revenue (Q3 2025)

KPIs

Guidance Changes

Earnings Call Themes & Trends

Note: No prior quarter earnings materials were located in filings; HTFL became public in August 2025.

Management Commentary

• “Heartflow delivered an outstanding third quarter of 2025… Durable growth in our FFRCT business and rapid expansion of our installed base drove third quarter total revenue up 41% year-over-year.” — John Farquhar, CEO
• “Operating expenses were 101% of revenue versus 114% a year ago, demonstrating improving operating leverage while we continue to invest for growth.” — Vikram Verghese, CFO
• “As of October 2025, the warrant holder net exercised all warrants… we expect to record a final non-cash warrant revaluation charge of approximately $9.3M in Q4 2025. Q4 will be the last quarter with any warrant remeasurement impact.” — Vikram Verghese, CFO
• “We received FDA 510(k) clearance for our next-generation Plaque Analysis and began the full commercial launch… 21% improvement in plaque detection performance.” — John Farquhar, CEO
• “We’re not forecasting material Plaque adoption until we receive 70% of all covered lives… I would not advise any material adoption until the tail end of 2026.” — John Farquhar, CEO

Q&A Highlights

• Growth drivers and guidance philosophy: Management cited durable FFRCT demand, installed base expansion, referrer activation (TAMs), and conservative guidance posture amid tougher sequential comps.
• Plaque pathway: Material adoption requires ≥70% covered lives and physician education; progress on coverage and clinical evidence is strong, but revenue contribution is likely back-end loaded to late 2026.
• Gross margin durability: Margin gains tied to higher case volumes and algorithmic automation; Q4 margin expected similar to Q3, with long-term confidence in ≥80%.
• PCI Navigator positioning: Extends HeartFlow platform into interventional planning; strong interest observed, with Navigate PCI registry planned H1’26 to quantify impact.

Estimates Context

• Revenue beat: Q3 revenue $46.276M vs consensus $41.961M, driven by U.S. FFRCT volume and installed base; implies ~10% upside to expectations. *
• EPS miss: Q3 non-GAAP EPS ($0.27) vs consensus ($0.24); non-GAAP adjustments excluded non-cash warrant revaluation, derivative liability change, and debt extinguishment. *
• Forward look: Q4 2025 consensus revenue $46.236M, EPS ($0.155), EBITDA (~$13.822M); management signaled similar gross margins to Q3 and final warrant impact in Q4. *

Values retrieved from S&P Global.*

Key Takeaways for Investors

• Revenue momentum and margin execution are intact, evidenced by a revenue beat and 76.5–76.8% margins; near-term trading may focus on whether Q4 delivers “similar” margins and sustained volume leverage.
• EPS volatility was driven by non-cash, transitory items (warrant revaluation) and debt extinguishment; with warrants fully exercised, Q4 should be the last quarter with warrant-related noise.
• The FFRCT franchise remains the core growth engine; installed base growth and TAM expansion underpin 2025 guidance of $173.0–$173.5M.
• Plaque is a significant “second wave” but requires ≥70% coverage and substantial physician education; expect revenue contribution to skew to late 2026 rather than 2025–H1’26.
• PCI Navigator broadens the platform into treatment planning and can aid account penetration and stickiness ahead of a 2026 commercial launch.
• Balance sheet strength (cash $291.2M, zero term loan post prepayment) provides flexibility to fund growth and clinical programs toward cash flow breakeven within three years of IPO.
• Watch for: Q4 gross margin confirmation, final ~$9.3M warrant charge, cadence of installed base adds, and payer coverage progress toward the 70% Plaque inflection.