Outset Medical (OM) Q4 2025 earnings summary

Executive summary

• Achieved 2025 revenue of $119.5 million, up 5% year-over-year, with recurring revenue from consumables and services growing 6% to $88.7 million.

• Gross margin expanded to 39.1% for the year and 42.4% in Q4, with product gross margin exceeding 50% in Q4.

• Net loss narrowed to $81.7 million (GAAP) and $65.4 million (non-GAAP), a significant improvement over 2024.

• Received FDA clearance for next-generation Tablo platform, enhancing cybersecurity and system reliability, with launch expected in Q2 2026.

• Ended the year with $173 million in cash, cash equivalents, and investments.

Financial highlights

• Q4 revenue was $28.9 million, with $19.9 million in product revenue and $9 million in service and other revenue.

• Product revenue for 2025 was $84.8 million, up 5% year-over-year; service and other revenue was $34.7 million, up 6%.

• Gross profit for 2025 was $46.8 million, up from $38.6 million in 2024.

• Non-GAAP gross margin for Q4 expanded to 42.9%, and product gross margin exceeded 50% for the first time.

• Non-GAAP operating expenses for 2025 were $97.8 million, a 19% reduction from 2024.

Outlook and guidance

• 2026 revenue expected between $125 million and $130 million, a 5–9% increase over 2025.

• Non-GAAP gross margin projected in the low-to-mid 40% range, with potential for higher margins depending on product mix.

• Operating expense growth to be about half the rate of sales growth; cash use in 2026 expected to be lower than $46 million used in 2025.

• Q1 2026 revenue expected to be flat sequentially, with growth ramping through the year.