Why Heartflow Stock Soared Today
Key Points
Heartflow's AI-powered platform could save countless lives.
The company is growing at an impressive clip.
Shares of Heartflow (NASDAQ: HTFL) jumped on Friday after the medical diagnostics specialist boosted its full-year revenue targets.
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Hearty growth
Coronary artery disease is the leading cause of death worldwide. Heartflow is working to make it a condition that can be accurately detected and effectively managed.
Its Heartflow One platform uses cutting-edge artificial intelligence (AI) to turn coronary images into personalized 3D models of the heart, providing doctors with a non-invasive way to locate plaque and ascertain its effect on blood flow.
Unsurprisingly, given these benefits, Heartflow's tech is in high demand. The company's revenue surged 48% year over year to $64.1 million in the second quarter.
Moreover, Heartflow's profitability is improving as it scales its operations. Its adjusted gross margin increased to 83.3% from 75.6% in the year-ago period.
Investors should note that Heartflow is not yet profitable. But its adjusted operating loss did narrow to $7.9 million from $11.5 million in the prior-year quarter.
A path to sustained profitability
Heartflow now expects its full-year revenue to grow by 40%-42% to between $246 million and $250 million in 2026, up from a prior forecast of 29%-32% growth. Management also lifted its adjusted gross margin target to 82% from 81%.
"Record gross margin and improving operating leverage demonstrate the increasing scalability of our model, giving us greater confidence in long-term, profitable growth," CEO John Farquhar said.
Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.