• Revenue: $164.3 million in Q4 2024, representing 24% year-over-year growth.
• Gross Margin: 70% in Q4 2024, an improvement from 66% at the beginning of the year.
• Adjusted Net Income: $0.2 million or $0.01 per share in Q4 2024, compared to an adjusted net loss of $25.8 million or $0.84 per share in Q4 2023.
• Adjusted EBITDA: $19.3 million or 11.7% of revenue in Q4 2024, compared to 1.8% in Q4 2023.
• Full Year Adjusted EBITDA: Negative $7.7 million or 1.3% of revenue for 2024.
• Operating Expenses: $116.7 million in Q4 2024, up 2.6% year-over-year.
• Free Cash Flow: Over $30 million generated during the last 3 quarters of 2024.
• Cash and Short-term Investments: Approximately $535.6 million at the end of Q4 2024.
• 2025 Revenue Guidance: $675 million to $685 million.
• 2025 Adjusted EBITDA Margin Guidance: Expected to range between 7% and 8% of full year revenues.

• Warning! GuruFocus has detected 6 Warning Signs with IRTC.

Release Date: February 20, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• iRhythm Technologies Inc (NASDAQ:IRTC) achieved over 20% revenue growth in 2024, driven by sustained volume demand across all customer channels.
• The company celebrated 1 million patients registered for GeoMonitor in 2024, highlighting strong adoption of their new long-term continuous monitor.
• iRhythm Technologies Inc (NASDAQ:IRTC) improved its gross margin profile from 66% at the beginning of the year to 70% by the fourth quarter of 2024.
• The company successfully expanded its international presence, launching ZO services in Austria, the Netherlands, Switzerland, and Spain, and received regulatory approval in Japan.
• iRhythm Technologies Inc (NASDAQ:IRTC) reported its first positive adjusted net income in the fourth quarter of 2024, demonstrating a focus on profitable growth.

Negative Points

• The company faces potential tariffs from Mexico, Canada, and China, which could negatively impact gross margins by 50 to 75 basis points.
• iRhythm Technologies Inc (NASDAQ:IRTC) continues to incur significant expenses related to FDA remediation efforts and DOJ subpoena activities, totaling approximately $11 million in 2024.
• There is a low single-digit pricing pressure expected in 2025, which could impact revenue growth.
• The company is still in the early stages of international expansion, with contributions from new markets expected to be modest in 2025.
• iRhythm Technologies Inc (NASDAQ:IRTC) is managing ongoing regulatory and quality compliance issues, with remediation efforts expected to continue throughout 2025.

Q & A Highlights

Q: Could you elaborate on the guidance for 2025, considering the multiple catalysts like record account openings and Epic integration? A: Daniel Wilson, CFO: For 2025, we see several growth drivers, including balanced growth across multiple areas. However, we are cautious due to potential headwinds like low single-digit pricing pressure and competitive disruptions. We aim to maintain a balanced approach while being optimistic about the business momentum.

Q: How has the momentum from 2024 continued into 2025, and what trends are you seeing in the first quarter? A: Quentin Blackford, CEO: We saw growth increase every quarter in 2024, driven by new channels like primary care. While we had some benefits from new channel partners in Q4, we want to see sustained contributions before adjusting our guidance. The ZOAT side remains promising, and we are monitoring market disruptions.

Q: Can you update us on the progress with the FDA remediation efforts and the 483 observations? A: Quentin Blackford, CEO: We are making significant progress and aim to complete remediation activities by mid-2025. We maintain regular communication with the FDA and have met all deliverables. We are also conducting an independent review to ensure high standards.

Q: What is the status of the Z1CT timelines, and do you need to wait for the 483 remediation before submitting for approval? A: Quentin Blackford, CEO: We are on track to submit Z1CT for approval in Q3 2025. The 483 remediation does not need to be fully completed before submission. We prioritized critical remediation activities to demonstrate our commitment to the FDA.

Q: How is the Epic integration progressing, and what impact is it having on demand generation? A: Quentin Blackford, CEO: The Epic integration has been successful, improving workflow efficiency and customer satisfaction. We are seeing positive anecdotal signs of volume uplift, but we need more data before adjusting forward-looking expectations. The integration is expected to enhance patient care and increase volumes.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.