iRhythm Technologies, Inc. (NASDAQ:IRTC) reported preliminary financial results for the fourth quarter of 2025, showing a 25.7% year‑over‑year revenue increase to $192.9 million, driven by a 30% rise in commercial volumes and a shift toward higher‑priced Zio AT services. The company’s net loss narrowed to $5.2 million from a $1.3 million loss in Q4 2024, while operating cash flow turned positive for the first time in its history, marking a milestone that signals a transition from a growth‑at‑all‑costs model to profitable scaling.
iRhythm’s gross margin expanded to 71.1% from 70.0% in Q4 2024, a lift attributed to the mix shift toward higher‑margin Zio AT services and improved operational leverage as revenue scales. The company’s free‑cash‑flow positivity, achieved for the first time, reflects disciplined cost management and a growing customer base in primary care and population health, where AI‑powered risk‑stratification partnerships are expanding.
Management highlighted the continued success of its clinical evidence program, citing the AVALON 7 and CAMELOT 8 studies that reinforce the clinical superiority of its long‑term cardiac monitoring platform. These studies support the company’s strategy to broaden its addressable market into adjacent indications such as obstructive sleep apnea and to deepen penetration in international markets.
For 2026, iRhythm projects revenue of $870 million to $880 million, a 17%–18% year‑over‑year increase, and an adjusted EBITDA margin of 11.5%–12.5%. The guidance reflects confidence in sustained demand for its monitoring services and the expected acceleration of its AI‑driven analytics platform, while acknowledging ongoing regulatory remediation efforts and valuation concerns that may temper investor enthusiasm.
Market reaction to the preliminary announcement was muted, with the stock falling 5.2% on heavy volume. Analysts noted that, despite the strong results, the company’s valuation multiples remain high and the guidance, while positive, does not fully offset concerns about future growth sustainability and regulatory compliance risks.
Management emphasized that the company remains focused on cost discipline, strategic investments in high‑return verticals, and maintaining a robust pipeline of clinical evidence to support market expansion. CEO Quentin Blackford stated that the quarter “represents a transformative year for iRhythm, with record commercial volumes, over 25% year‑over‑year revenue growth, and the first free‑cash‑flow‑positive quarter in company history.”
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