Shares of Butterfly Network BFLY soared by 26.9% on Sept. 4 following the announcement of the commercial launch of their cutting-edge Butterfly iQ3 handheld ultrasound system in Europe. Investors have shown tremendous enthusiasm, likely fueled by the remarkable success of the Butterfly iQ3 in the U.S. market since its debut earlier in the year.
The Butterfly iQ3 earned EU MDR certification in March and meets all requirements of the Restriction of Hazardous Substances Directive. This highly anticipated device is now available across all European countries as well as the United Kingdom, having been introduced in Canada during the second quarter. Plans are underway for regulatory approval in additional regions.
The Butterfly iQ3 represents a significant advancement in Butterfly Network’s ultrasound device lineup, surpassing the second-generation iQ+. Empowered by BFLY’s state-of-the-art P4.3 chip, the iQ3 boasts double the processing prowess of the iQ+ and delivers superior image quality. It also features new advanced 3D imaging tools for enhanced usability and a compact, ergonomic design. Furthermore, its higher price point compared to the iQ+ is expected to drive revenue growth to new heights.
With a remarkable 39.9% surge year-to-date, Butterfly Network shares have outperformed the industry decline of 13.5%, supported by the remarkable uptake of the Butterfly iQ3 in the U.S. market.
Impressive Performance of BFLY’s iQ3 in the U.S.
Butterfly Network’s second-quarter revenue growth of 16% was primarily attributed to the strong adoption of the Butterfly iQ3 in the United States, along with increased sales from the Canadian launch. During the quarter, 74% of total online orders were for the iQ3, which accounted for 89% of sales across all distribution channels in Canada. The company initiated a successful competitive device upgrade in the second quarter, allowing customers to trade in their old non-Butterfly products for the latest iQ3 model, presenting a promising avenue for growth.
iQ3 sales represented 50% of the total unit sales in the second quarter, with 75% of the total units sold in the United States.
BFLY’s iQ3 Revolutionizing Patient Care
The advanced 3D features of the Butterfly iQ3, including iQ Slice and iQ Fan, simplify image capturing processes. iQ Slice allows for up to 46 ultrasound slices to be captured simultaneously across a broad angle, enabling quick and effortless acquisition of high-quality images without the need for complex manipulation. Conversely, iQ Fan is a specialized lung tool that streamlines information capture, aiding clinicians in making informed decisions.
These cutting-edge features, combined with Butterfly’s extensive set of anatomical presets, imaging modes, artificial intelligence capabilities, advanced imaging tools, and calculation features, set the iQ3 apart. The device’s compact, ergonomic design has been a key factor in its rapid adoption in the U.S. and Canada and is expected to attract similar success in European markets. Notably, the iQ3 boasts a probe face 17% smaller and a 7% smaller overall size compared to the iQ+, along with an enhanced battery offering up to 2 hours of continuous scanning and rapid charging, making it a game-changer in the field.
These enhancements have significantly improved echo image quality and the biplane mode for cannulation, enhancing patient management, especially in cases requiring challenging IV access.
BFLY’s Zacks Rank & Market Comparisons
Butterfly Network presently holds an impressive Zacks Rank #2 (Buy).
Other top-performing stocks in the broader medical sector include Boston Scientific BSX, Apyx Medical APYX, and Universal Health Services UHS, all carrying a Zacks Rank #2 currently.
Boston Scientific boasts a long-term estimated growth rate of 12.6% and has consistently exceeded earnings expectations over the past four quarters.
Apyx Medical, with a 20% growth projection for 2025, saw its earnings fall short of estimates in the previous four quarters.
Universal Health Services maintains a long-term estimated growth rate of 19% and has surpassed earnings estimates in each of the last four quarters.