Butterfly Network Q2 Revenue Jumps 39% on Embedded Partnership Surge; Midjourney Deal Disclosed
BFLY has more than doubled off its 52-week low of $1.32.
Summary
Butterfly Network's Q2 revenue surged 39% to $32.6M, beating estimates, driven by a 150% jump in software and services revenue from Embedded partnerships. The company also disclosed a lucrative co-development deal with AI firm Midjourney.
Key Events · Earnings and Guidance · BFLY
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Q2 Revenue Beats on Embedded Surge
Total revenue of $32.6M, up 39% YoY, driven by a 149.8% increase in software and other services to $16.9M, primarily from Embedded partnerships including Midjourney.
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Midjourney Co-Development Deal Disclosed
Exhibit 10.1 reveals a 5-year agreement with AI lab Midjourney, including a $15M upfront NRE fee, $10M annual license fee, and a revenue share on future commercial products using Butterfly's chip technology.
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Net Loss Narrows, Cash Runway Solid
Net loss improved to $12.9M from $13.8M YoY. Cash and equivalents stood at $124.7M, down from $150.5M at year-end, but sufficient to fund operations for at least 12 months.
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Litigation Liabilities Rise, Fully Insured
Estimated liabilities for loss contingencies increased to $10M, primarily from the Sezonov case, but a corresponding $10M insurance recovery asset was recognized, resulting in no net P&L impact.
Analysis · BFLY · Industrial Applications And Services
A standout quarter for Butterfly Network saw revenue climb 39% year-over-year to $32.6 million, topping expectations. The real engine was software and other services, which more than doubled to $16.9 million, powered by Embedded partnerships—most notably a newly unveiled co-development and licensing agreement with AI lab Midjourney. That deal delivers $15 million upfront and $10 million annually, plus a revenue share on future commercial products. While the net loss narrowed, the company holds $124.7 million in cash, providing ample runway. The quarter also brought a sharp rise in litigation-related liabilities to $10 million, fully offset by an insurance recovery asset, leaving the net P&L impact neutral. Against a backdrop of heavy insider selling by the CEO and founder in recent weeks, these results and the Midjourney partnership offer a positive fundamental counterpoint.
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At the time of this filing, BFLY was trading at $7.60 on NYSE in the Industrial Applications And Services sector, with a market capitalization of approximately $1.9B. The 52-week trading range was $1.32 to $9.69. This filing was assessed with positive market sentiment and an importance score of 8 out of 10.