0001464521-25-000019
SEC filingHeartflow's revenue grew 41% YoY driven by a 48% increase in revenue case volume, partially offset by mix shift to lower-priced accounts.
Heartflow's revenue for Q3 2025 was $46.3M, up 41% from $32.9M in Q3 2024, driven by a 48% increase in revenue case volume (51,805 vs. 34,970). This volume growth was partially offset by a lower average selling price due to a mix shift toward clinic/office-based accounts (32% of U.S. revenue cases vs. 29% in the prior year) and increased utilization and volume rebates. Gross profit rose 42% to $35.4M, with gross margin improving to 77% from 76%, benefiting from higher volume and production team productivity, partially offset by continued hiring and training costs. Operating expenses increased 27% to $50.5M, with R&D up 46% to $17.3M (driven by headcount and clinical trials) and SG&A up 19% to $33.2M (driven by personnel and marketing). Loss from operations remained relatively flat at $15.1M vs. $14.9M. However, net loss widened significantly to $50.9M from $19.1M due to $34.0M in other expense, including a $32.1M charge from remeasurement of the common stock warrant liability and a $6.4M loss on extinguishment of the 2024 Term Loan, partially offset by a $4.8M gain on derivative liability remeasurement.
Heartflow operates as a single segment, generating revenue primarily from usage-driven fees for Heartflow FFR CT Analysis (98% of revenue) and emerging Heartflow Plaque Analysis. Revenue case growth is the key volume metric, with Q3 2025 cases up 48% YoY. The mix of cases is shifting toward lower-priced clinic/office-based accounts, which represented 32% of U.S. cases vs. 29% a year ago, pressuring average revenue per case. The company continues to invest in expanding its installed base and educating physicians, with new accounts typically reaching steady state (33% FFR CT utilization of CCTA volume) within 12 months. The planned launch of Heartflow PCI Planner in 2026 aims to further expand the product portfolio.
Management expects to continue incurring operating losses as it scales the business, invests in R&D for new product features and clinical studies, and expands sales and marketing to drive adoption. Based on current operating plans, existing cash ($291.2M) plus expected cash from revenue is sufficient to fund operations for at least 12 months. No specific revenue or margin guidance was provided. Key drivers include further adoption of CCTA+Heartflow pathway, successful introduction of Plaque Analysis, automation of production processes to improve gross margin, and seasonality from staff availability. The IPO and debt conversion have strengthened the balance sheet, eliminating interest expense on the converted notes and term loan.
Heartflow's balance sheet strengthened significantly following its IPO in August 2025. Cash and cash equivalents totaled $291.2M as of September 30, 2025, up from $51.4M at year-end 2024, driven by $332.8M in net IPO proceeds. The company fully repaid its term loan ($115.1M principal plus fees) and converted $98.3M in convertible notes to equity. Total shareholders' equity turned positive to $254.6M from a deficit of $859.5M. The accumulated deficit remains high at $1.06B, reflecting ongoing losses.
The company has $4.5M in open purchase commitments for goods and services over the next three years (Note 7). Additionally, minimum royalty commitments under technology license agreements total $0.25M, with annual payments of $50k through 2029 and beyond. No material litigation contingencies were disclosed, though a subsequent event notes a civil investigative demand from the DOJ in October 2025.
Heartflow did not engage in any share buybacks or dividends during the period. Capital expenditures were $3.1M (2.5% of revenue), primarily for property and equipment. The company raised $72.8M in convertible notes (later converted to equity in the IPO) and repaid $115.1M in term loan principal. No new debt was outstanding at quarter end.
The company operates as a single reportable segment. Geographic revenue detail (Note 3): United States accounted for 92.4% of total revenue ($117.2M of $126.9M for nine months), followed by UK ($4.5M), Japan ($4.2M), and Rest of Europe ($1.0M). Revenue growth was broad-based with U.S. up 41.3% YoY.
Heartflow's cash flow from operations (CFO) remained negative at -$43.4M for the nine months ended September 30, 2025, an improvement from -$55.0M in the prior year. The net loss widened to -$92.4M from -$63.5M, but non-cash adjustments (e.g., $34.6M change in warrant liability, $8.7M stock-based compensation) and favorable working capital changes (e.g., $6.0M increase in accrued expenses) narrowed the cash burn. Capital expenditures (capex) decreased to $3.1M from $4.0M, reflecting lower investment in property and equipment.
Notably, the company raised significant financing: $332.8M from IPO (net) and $72.8M from convertible notes, offset by $115.1M term loan repayment and $6.8M exit fees. This bolstered cash by $239.8M to $295.6M at period end.
The cash flow statement reveals high dependence on external financing to fund operations and growth. While operating cash burn is moderating, the company still relies on capital markets. No free cash flow is reported, and with negative CFO, free cash flow would also be negative. Working capital swings were mixed, with accounts receivable and prepaid expenses consuming cash, while accrued expenses provided a boost. Overall, cash flow quality is weak due to continued net losses, but the IPO and debt restructuring have strengthened the balance sheet.