Full Press Release Details
Butterfly Network, Inc. Reports 2020 Financial
Strong Year-Over-Year Revenue Growth Driven
by Continued Adoption of Butterfly Technology
GUILFORD, Conn. and NEW YORK, New York, March 29, 2021 -- Butterfly
Network, Inc. (NYSE: BFLY) ("Butterfly" or the "Company"), a digital health company working to bring medical imaging
to all and to advance global health equity, today announced financial results for the full year 2020 and provided a business update.
"In 2020, Butterfly grew revenues by 68% to $46.3 million
as probe sales continued to increase, driven by the further adoption of our technology by healthcare providers," said Dr. Todd
Fruchterman, Butterfly Network's President and Chief Executive Officer. "In the fourth quarter, we introduced the
next-generation Butterfly probe, the iQ+, and more upgrades to our proprietary, patented technology platform. We are excited to see
the demand for our comprehensive solution, which helps healthcare providers intercept disease and treat conditions earlier, and we
expect will ultimately reduce the total cost of care while improving patient outcomes."
"The completion of our business combination with Longview Acquisition
Corp. in February 2021 solidifies the company's financial foundation for the next stage of its growth," said Stephanie Fielding,
Butterfly Network Chief Financial Officer.
Full Year 2020 Financial Results
Total revenues for the full year 2020 were $46.3 million, a 68% increase
year-over-year from $27.6 million in 2019. Product revenues for the full year 2020 were $38.4 million, an increase of 53% from $25.1 million
in 2019, and Subscription revenues were $7.9 million in 2020, growing 216% from $2.5 million in 2019. These increases were primarily due
to a higher volume of products sold from a ramping up of commercial efforts and the introduction of Butterfly iQ+, the next generation
hardware in October 2020.
Total gross loss for 2020 was ($61.2) million, compared to 2019 gross
loss of ($20.9) million. Total gross margin for the full year of 2020 was (132.4%), compared to (75.8%) in 2019. Cost of revenue in 2020 was significantly impacted by non-recurring charges totaling $62.7 million.
Operating expenses in 2020 were $100.4 million, a moderate 23% increase
year-over-year from $81.4 million in 2019, as the company conserved cash while various financing options were evaluated over the course
Net loss in 2020 was ($162.7) million as compared to a net loss of
($99.7) million during 2019.
EBITDA was ($160.3) million in 2020, compared with ($101.5) million
in 2019. Adjusted EBITDA was ($85.2) million in 2020 compared with ($86.0) million in 2019.
Cash and cash equivalents at December 31, 2020 were $60.2 million.
Recent Company Highlights
In February 2021, Butterfly announced the appointment of Dr. Fruchterman
as its President and Chief Executive Officer in advance of the closing of its business combination with Longview Acquisition Corp.
The company established a number of partnerships in 2020 designed to
expand awareness and the reach of its unique point-of-care ultrasound. This included a collaboration with the American College of Cardiology
to transform cardiovascular care using point-of-care ultrasound, announced in October 2020.
A conference call to review 2020 financial results and to provide
a business update is scheduled for March 29, 2021 at 4:30 PM Eastern Time. Interested parties may access the conference call by dialing
(844) 558-0160 (U.S.) or (236) 714-3222 (International) and referencing Conference ID 9239416. Additionally, a link to a live webcast
of the call will be available in the Investor Relations section of Butterfly's website at https://ir.butterflynetwork.com.
About Butterfly Network, Inc.
Founded by Dr. Jonathan Rothberg in 2011, and recently listed on the
New York Stock Exchange through a business combination with Longview Acquisition Corp., Butterfly created the world's first handheld,
single probe whole-body ultrasound system using semiconductor technology, the Butterfly iQ. Butterfly's mission is to democratize
medical imaging and contribute to the aspiration of global health equity, making high-quality ultrasound affordable, easy-to-use, globally
accessible, and intelligently connected, including for the 4.7 billion people around the world lacking access to ultrasound. Through its
proprietary Ultrasound-on-Chip technology, Butterfly is paving the way for earlier detection and remote management of health conditions
around the world. The Butterfly iQ can be purchased by healthcare practitioners in the United States, Australia, Austria, Belgium, Canada,
Denmark, Finland, France, Germany, Ireland, Italy, the Netherlands, New Zealand, Norway, Poland, Portugal, Spain, Sweden, Switzerland,
and the United Kingdom. Butterfly iQ is a prescription device intended for trained and qualified healthcare professionals only.
Forward Looking Statements
This press release includes "forward-looking
statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform
Act of 1995. The Company's actual results may differ from its expectations, estimates, and projections and, consequently, you should
not rely on these forward-looking statements as predictions of future events. Words such as "expect," "estimate,"
"project," "budget," "forecast," "anticipate," "intend," "plan,"
"may," "will," "could," "should," "believes," "predicts," "potential,"
"continue," and similar expressions (or the negative versions of such words or expressions) are intended to identify such
forward-looking statements. These forward-looking statements include, without limitation, the Company's expectations with respect
to financial results, future performance, development of products and services, potential regulatory approvals, anticipated financial
impacts and other effects of the Company's business combination on its business, and the size and potential growth of current or
future markets for its products and services. These forward-looking statements involve significant risks and uncertainties that could
cause the actual results to differ materially from those discussed in the forward-looking statements. Most of these factors are outside
the Company's control and are difficult to predict. Factors that may cause such differences include, but are not limited to: the
impact of COVID-19 on the Company's business; the ability to recognize the anticipated benefits of the business combination; the
Company's ability to grow and manage growth profitably; the success, cost and timing of the Company's product and service
development activities; the potential attributes and benefits of the Company's products and services; the Company's ability
to obtain and maintain regulatory approval for its products, and any related restrictions and limitations of any approved product; the
Company's ability to identify, in-license or acquire additional technology; the Company's ability to maintain its existing
license, manufacture, supply and distribution agreements; the Company's ability to compete with other companies currently marketing
or engaged in the development of products and services that the Company is currently marketing or developing; changes in applicable laws
or regulations; the size and growth potential of the markets for the Company's products and services, and its ability to serve those
markets, either alone or in partnership with others; the pricing of the Company's products and services and reimbursement for medical
procedures conducted using its products and services; the Company's estimates regarding expenses, revenue, capital requirements
and needs for additional financing; the Company's financial performance; the Company's ability to raise financing in the future;
and other risks and uncertainties indicated from time to time in the Company's filings with the Securities and Exchange Commission.
The Company cautions that the foregoing list of factors is not exclusive. The Company cautions you not to place undue reliance upon any
forward-looking statements, which speak only as of the date of this press release. The Company does not undertake or accept any obligation
or undertake to release publicly any updates or revisions to any forward-looking statements to reflect any change in the Company's
expectations or any change in events, conditions or circumstances on which any such statement is based.
BFLY OPERATIONS, INC. (FORMERLY BUTTERFLY NETWORK, INC.)
CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share amounts)
| December 31, | ||||||||
| 2020 | 2019 | |||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 60,206 | $ | 90,002 | ||||
| Accounts receivable, net | 5,752 | 1,951 | ||||||
| Inventories | 25,805 | 9,441 | ||||||
| Current portion of vendor advances | 2,571 | 5,239 | ||||||
| Prepaid expenses and other current assets | 2,960 | 1,793 | ||||||
| Due from related parties | 38 | 829 | ||||||
| Total current assets | $ | 97,332 | $ | 109,255 | ||||
| Property and equipment, net | 6,870 | 5,325 | ||||||
| Non-current portion of vendor advances | 37,390 | 46,940 | ||||||
| Other assets - related party | - | 1,661 | ||||||
| Other non-current assets | 5,599 | 1,956 | ||||||
| Total assets | $ | 147,191 | $ | 165,137 | ||||
| Liabilities, convertible preferred stock, and stockholders' deficit | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 16,400 | $ | 5,168 | ||||
| Deferred revenue, current | 8,443 | 3,200 | ||||||
| Due to related parties | 154 | 6 | ||||||
| Accrued purchase commitments, current | 22,890 | - | ||||||
| Accrued expenses and other current liabilities | 21,808 | 6,951 | ||||||
| Total current liabilities | $ | 69,695 | $ | 15,325 | ||||
| Deferred revenue, non-current | $ | 2,790 | $ | 587 | ||||
| Convertible debt | 49,528 | - | ||||||
| Loan payable | 4,366 | - | ||||||
| Accrued purchase commitments, non-current | 19,660 | - | ||||||
| Other non-current liabilities | 2,146 | 566 | ||||||
| Total liabilities | $ | 148,185 | $ | 16,478 | ||||
| Convertible preferred stock | 360,937 | 360,937 | ||||||
| Total stockholders' deficit | $ | (361,931 | ) | $ | (212,278 | ) | ||
| Total liabilities, convertible preferred stock and stockholders' deficit | $ | 147,191 | $ | 165,137 |
BFLY OPERATIONS, INC. (FORMERLY BUTTERFLY NETWORK, INC.)
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except shares and per share amounts)
| Year ended December 31, | ||||||||
| 2020 | 2019 | |||||||
| Revenue: | ||||||||
| Product | $ | 38,347 | $ | 25,081 | ||||
| Subscription | 7,905 | 2,502 | ||||||
| Total revenue | $ | 46,252 | $ | 27,583 | ||||
| Cost of revenue: | ||||||||
| Product (including losses on purchase commitments of $60.1 million and $9.5 million, respectively) | $ | 106,407 | $ | 47,857 | ||||
| Subscription | 1,068 | 621 | ||||||
| Total cost of revenue | $ | 107,475 | $ | 48,478 | ||||
| Gross loss | $ | (61,223 | ) | $ | (20,895 | ) | ||
| Gross margin | (132.4 | )% | (75.8 | )% | ||||
| Operating expenses: | ||||||||
| Research and development | $ | 49,738 | $ | 48,934 | ||||
| Sales and marketing | 26,263 | 14,282 | ||||||
| General and administrative | 24,395 | 18,185 | ||||||
| Total operating expenses | $ | 100,396 | $ | 81,401 | ||||
| Loss from operations | $ | (161,619 | ) | $ | (102,296 | ) | ||
| Interest income | 285 | 2,695 | ||||||
| Interest expense | (1,141 | ) | - | |||||
| Total other income (expense), net | (231 | ) | (96 | ) | ||||
| Loss before provision for income taxes | $ | (162,706 | ) | $ | (99,697 | ) | ||
| Provision for income taxes | 39 | - | ||||||
| Net loss | $ | (162,745 | ) | $ | (99,697 | ) | ||
| Net loss per common share attributable to common stockholders, basic and diluted | $ | (27.90 | ) | $ | (17.73 | ) | ||
| Weighted-average shares used to compute net loss per share attributable to common stockholders, basic and diluted | 5,833,164 | 5,622,752 |
Use of Non-GAAP Financial Measures
To supplement the Company's financial statements presented
on a GAAP basis, the Company has provided certain non-GAAP financial measures, including EBITDA and Adjusted EBITDA. Management uses
these non-GAAP measures to evaluate the Company's operating performance in a manner that allows for meaningful
period-to-period comparison and analysis of trends in its business. Management believes that such measures are important in
comparing current results with prior period results and are useful to investors and financial analysts in assessing the
Company's operating performance. The non-GAAP financial information presented here should be considered in conjunction with,
and not as a substitute for, the financial information presented in accordance with GAAP. Investors are encouraged to review the
reconciliation of these non-GAAP measures to their most directly comparable GAAP financial measures set forth below.
BFLY OPERATIONS, INC. (FORMERLY BUTTERFLY NETWORK, INC.)
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
| Years ended December 31, | ||||||||
| 2020 | 2019 | |||||||
| Net Loss | $ | (162,745 | ) | $ | (99,697 | ) | ||
| Add: | ||||||||
| Interest income | (285 | ) | (2,695 | ) | ||||
| Interest expense | 1,141 | - | ||||||
| Other expense, net | 231 | 96 | ||||||
| Provision for income taxes | 39 | - | ||||||
| Depreciation and amortization | 1,316 | 758 | ||||||
| EBITDA | $ | (160,303 | ) | $ | (101,538 | ) | ||
| Add: | ||||||||
| Stock based compensation | 11,004 | 6,038 | ||||||
| Loss on purchase commitments | 60,113 | 9,500 | ||||||
| Inventory write down | 2,570 | - | ||||||
| Impairment of prepaid advance | 1,390 | - | ||||||
| Adjusted EBITDA | $ | (85,226 | ) | $ | (86,000 | ) |