This article first appeared on GuruFocus .
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Revenue:Total revenue of $64.1 million, up 48% year over year.
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US Revenue:$59.6 million, up 51% year over year.
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Plaque Revenue:$7.8 million in the second quarter.
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OUS and Other Revenue:$4.5 million.
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Total Global Revenue Cases:84,491, up 74% year over year.
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Gross Margin:83.3%, compared to 75.6% in the second quarter of 2025.
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SG&A Expenses:$37.8 million.
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R&D Expenses:$23.5 million.
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Non-GAAP Operating Loss:$7.9 million, compared to $11.5 million last year.
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Non-GAAP Net Loss:$5.8 million, or $0.07 per share, compared to a net loss of $17.6 million, or $2.79 per share, in the second quarter of 2025.
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GAAP Net Loss:$15.7 million, or $0.18 per share.
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Cash and Investments:$246.8 million at the end of the quarter.
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Full-Year 2026 Revenue Guidance:Raised to $246 million to $250 million, representing 40% to 42% growth.
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Full-Year 2026 Plaque Revenue Guidance:Raised to $29 million to $31 million.
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Full-Year 2026 Non-GAAP Gross Margin Guidance:Approximately 82%.
Release Date: August 13, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Revenue grew 48% year-over-year to $64.1 million, with US revenue up 51%, marking the fastest growth in eight quarters.
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Plaque revenue exceeded expectations at $7.8 million, with activations and utilization ahead of plan, supporting a raised full-year outlook.
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Gross margin expanded to 83.3%, up 770 basis points year-over-year, driven by AI efficiencies, volume leverage, and higher-margin Plaque mix.
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Launched Heartflow Plaque Staging, a clinically validated tool for risk stratification, expected to drive further adoption.
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Selected as exclusive Plaque provider for the NIH-funded PRE-EMPT study, highlighting clinical confidence in the technology.
Negative Points
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Non-GAAP operating loss of $7.9 million and net loss of $5.8 million persist, though improved year-over-year.
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FFRCT ASPs face pressure, with year-over-year declines expected to moderate only by 2027.
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Plaque adoption remains early, with utilization still far from the 60% applicability target.
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Ongoing IP litigation and CID investigation create potential legal and financial uncertainties.
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Full-year guidance implies only modest sequential revenue growth in H2, reflecting conservative assumptions and seasonality.
Q & A Highlights
Q: Can you provide more detail on what is driving the strong adoption of Plaque and what differentiates HeartFlow from competitors in this space? A: John Farquhar (CEO) stated that Plaque momentum is significant and ahead of plan, with new account activations on track to reach 1,250 by year-end, a milestone that took eight years to achieve with FFRCT. He attributes the success to market-leading accuracy and reproducibility, validated in peer-reviewed studies, which aligns with ACC scientific standards. Physician adoption metrics are at record levels, with utilization ramping above initial expectations, and coverage is ahead of plan at approximately 78%. Customers are increasingly choosing HeartFlow, signaling strong market preference.
Q: How should we think about the revenue beat in Q2, and was it driven more by FFRCT or Plaque? A: Vikram Verghese (CFO) clarified that Plaque handily beat expectations, with revenues of $7.8 million, approximately $4 million above plan. However, the overall performance was broad-based, with both FFRCT and Plaque contributing. FFRCT saw strong volume growth driven by improved utilization in existing sites and ramping new accounts. Plaque was a standout, with strong utilization trends, a record number of new ordering physicians, and existing physicians using the service more frequently.
Q: Can you provide an update on the DECIDE one-year outcomes and how the data might influence physician behavior? A: John Farquhar (CEO) confirmed the one-year outcomes will be presented in Q4, focusing on changes in LDL. He noted that while clinical data is important for education, the most significant driver of adoption is physicians observing real-world changes in their patients' LDL levels after using Plaque analysis. This real-world evidence is expected to create a snowball effect that will further support Plaque adoption over the long term.
Q: What are the timelines and next steps for the RCTs targeting the asymptomatic market, and is FDA approval required? A: John Farquhar (CEO) explained that the company is targeting three high-risk asymptomatic subpopulations: secondary prevention (prior MI/PCI), patients with calcium, and patients with Plaque. These trials will use existing technology, so no new FDA clearance is required. Each trial will enroll 300-500 patients, with endpoints measuring changes in physician management and outcomes (LDL and soft Plaque). Enrollment begins in Q4 2026 for the first two trials and Q1 2027 for the third. This approach is capital-efficient and leverages existing sales channels, with the goal of entering these markets with reimbursed technology before 2030.
Q: Can you elaborate on the operating leverage seen in Q2 and the role of AI efficiency in future margin expansion? A: Vikram Verghese (CFO) highlighted that Q2 outperformance on the top line was reinvested with discipline into R&D, yet EBIT was roughly cut in half quarter-over-quarter. The company is leveraging durable revenue growth with strong margin expansion to invest in R&D and commercial initiatives. Key drivers for future margin expansion include the autonomous processing initiative, which reduces human touch, and the scaling of Plaque revenues. Despite investments, OpEx as a percentage of revenue is expected to improve by at least 5 points year-over-year, reinforcing the path to profitability by 2028.
Q: How did pricing dynamics and revenue per case perform in Q2, and what is the outlook for ASPs? A: Vikram Verghese (CFO) noted that FFRCT volumes came in significantly above plan, with ASPs finishing modestly ahead of expectations due to favorable customer mix. This mix is considered durable, and consensus estimates for full-year FFRCT ASP are in the right ballpark. For Plaque, ASP favorability was driven by contractual step-ups that went into effect and a beneficial mix of higher-priced accounts. No further pricing changes are baked into the 2026 guidance, but a more meaningful step-up is expected in early 2027.
Q: What is the pace of Plaque adoption at key accounts, and is there a halo effect between FFRCT and Plaque usage? A: John Farquhar (CEO) confirmed that while the maximum applicability for Plaque is 60% of CCTAs, the ramp towards that level is ahead of expectations, though still early. Initially, there was more overlap with FFRCT patients also receiving Plaque, but this is broadening as adoption increases. The company is pleased with the progress and the expanding use of Plaque across a wider range of patients.
Q: Why does the full-year gross margin guidance not assume sequential improvement, and what are the key levers for expansion? A: Vikram Verghese (CFO) explained that the 82% gross margin guidance accounts for increased Plaque revenues, with about 75% of the Q2 beat driven by revenue outperformance. The remaining beat was due to headcount favorability and less R&D amortization. The architecture of margin expansion relies on AI-driven automation, Plaque revenue growth, and volume leverage. While there are puts and takes, including additional hiring in production and customer success, the autonomous processing initiative is expected to be a more significant driver in 2027, underpinning the mid-term target of 85%.
Q: Can you provide an update on the PCI Navigator product and its commercialization strategy? A: John Farquhar (CEO) stated that PCI Navigator is currently not charged for, and there are no plans to pursue reimbursement. The strategy is to use it as a differentiator to engage interventional cardiologists as champions for the CT plus HeartFlow pathway. The rollout is phased, focusing on high-volume PCI hospitals first, to avoid distracting from the primary focus on Plaque. Early feedback has been very strong, and the company plans to expand availability throughout the year and into 2027.
Q: What is the company's view on the recent CMS proposal for AI-enabled software reimbursement, and how might it impact HeartFlow? A: John Farquhar (CEO) viewed the proposal as a positive in the near term, noting that the 2027 hospital payment proposal keeps FFRCT and Plaque stable while increasing CCTA payments by nearly 12%, strengthening the economics of the HeartFlow pathway. Longer-term, the new framework for AI-enabled software is seen as constructive, as CMS acknowledges AI services differ from traditional medical devices. HeartFlow believes its clinical evidence aligns well with CMS's goal of better aligning payments with clinical outcomes, and the company looks
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
