Kestra beats , raises FY27 guidance to $141M and lifts long-term margin target

 

Kestra beats Q1 2027 revenue estimates with 60% growth, raises FY27 guidance to $141M and lifts long-term margin target

• Q1 revenue $31.0M, +60% YoY, about 7% above Street expectations per Q&A.
• Gross margin 56.5%, up 1,080 bps YoY and 175 bps QoQ, 11th straight increase.
• Management now targets mid-70s gross margin within a few years, up from 70% prior.
• FY27 revenue guidance raised to $141m (+48% YoY) from $137m, implying stronger 2H.
• GAAP OpEx guided to $220m (+20% YoY) as company invests aggressively in commercial and R&D.
• Adjusted EBITDA loss widened to $24m from $19.4m on higher OpEx despite stronger gross profit.
• Liquidity totals ~$320m including term loan capacity, supporting growth investments and path to profitability.
• Wearable cardioverter defibrillator market grew ~14% in dollars, Kestra estimates ~15% U.S. share.
• In-network fittings mix improved from ~70% at IPO to low-80s, boosting revenue per fit.
• Main risks: sustained cash burn, execution on AI and automation, and achieving ambitious margin targets.
• Main concern: visibility on reaching profitability given elevated cash burn and ambitious investment and margin plans.
• Strong quarter, driven by outsized revenue growth, ongoing gross margin expansion, and a raised full-year outlook.

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