| Factor | Score | Distribution | Value | Avg | Rank |
|---|---|---|---|---|---|
Valuation | 17 | — | 17.8x | Bottom tier | |
Growth | 76 | 28.1% | 7.1% | Top tier | |
Quality | 28 | -33.9% | 4.5% | Bottom tier | |
Safety | 49 | — | 2.6x | Around median | |
Capital Return | 26 | 0.00% | 2.12% | Bottom tier | |
Momentum | 84 | 429.6% | 2.9% | Top tier | |
Sentiment | 60 | 3 | 3 | Around median |
Estimates — analyst targets and a simplified DCF, not investment advice.
Butterfly Network develops a medical imaging platform based on Ultrasound-on-Chip technology and sells portable ultrasound devices such as iQ3 and iQ+, along with related software and services. Its core business includes probe sales, Compass AI software, and services, while Butterfly Embedded generates revenue from annual licensing fees, paid development work, hardware and chip sales, and then revenue sharing once partners' products reach the market. The company is also working to transform Butterfly Garden into a commercial platform for artificial intelligence applications and launch a home and community care model that combines fees linked to patient volume with per-scan fees.
In Q2 of fiscal year 2026, Butterfly Network recorded record revenue of $32.6 million, up 39% year over year, and record gross profit of $23.3 million, up 56%. Gross margin increased to 71% from 64%, benefiting from the greater contribution of the higher-margin Butterfly Embedded business, while net loss was $12.9 million and loss per share was $0.05. Adjusted earnings before interest, taxes, depreciation, and amortization loss improved by 78% to $1.4 million, compared with a loss of $6.2 million in the corresponding period of fiscal year 2025.
The Q2 fiscal year 2026 revenue mix consisted of $21.9 million from the core business, representing limited year-over-year growth of 2%, and $10.8 million from Butterfly Embedded, a 439% surge led by the Midjourney partnership. United States revenue reached $27.6 million, up 57%, while international revenue declined 14% to $5 million. On a trailing twelve-month basis in fiscal year 2026, revenue was $112.1 million and gross profit was $59 million, compared with a net loss of $74.8 million.
Automated analysis for informational purposes only — not investment advice.
The average analyst price target is $5.50, which is also the highest and lowest target, with the consensus rated Buy; the absence of any variation among the targets means the available coverage sample does not provide a broad range of scenarios. This target is above the 52-week range low of $1.47 but well below its high of $10.05, and there is no positive price-to-earnings ratio because of the trailing twelve-month net loss of $74.8 million; therefore, the valuation rationale depends on continued Embedded growth, margin improvement, and narrowing losses, rather than on currently realized earnings.
Figures in the text are as of 2026-09-01; the live price is shown at the top of the page.
Revenue increased 39% to a record $32.6 million, with Butterfly Embedded driving most of the increase. Embedded generated revenue of $10.8 million, up 439%, primarily driven by progress on the Midjourney partnership. In contrast, the core business grew 2% to $21.9 million, supported by United States healthcare institutions, medical schools, and the VCOM deal.
The announced contract with Midjourney has a value of $74 million, including an upfront payment of $15 million and annual licensing fees of $10 million. Butterfly recognizes revenue as work milestones are completed, while development work, chip sales, and revenue sharing can add further revenue once commercialization is reached. The company aims to deliver Apollo chips to Midjourney by the end of 2027 or the beginning of 2028.
The company has not yet achieved net profitability; net loss was $12.9 million and loss per share was $0.05 in Q2 of fiscal year 2026. However, the adjusted earnings before interest, taxes, depreciation, and amortization loss narrowed 78% to $1.4 million, and gross margin increased to 71%. Over the trailing twelve months in fiscal year 2026, net loss was $74.8 million compared with revenue of $112.1 million.
Butterfly aims to launch its next probe built on the P5.1 chip in Q1 of fiscal year 2027, adding harmonic imaging and improving cardiac imaging. It plans to enter the cart-based device market through iQ Station later in fiscal year 2027, a market whose existing size management estimated at approximately $1.6 billion to $2 billion. The company also aims to deliver the Apollo platform to Midjourney by the end of 2027 or the beginning of 2028, while iQ3 remains the core product until the next generation is launched.
The Compass AI opportunity pipeline has increased fivefold since fiscal year 2025, and the company signed six additional enterprise deals in Q2 of fiscal year 2026. The VCOM partnership has a potential contract value of more than $10 million over four years and includes iQ+, iQ3, and related software within the core business. As for home and community care, the first commercial state began on October 1, 2026, and its model relies on fees linked to patient volume, per-scan fees, and a potential component from realized savings.
