# Butterfly Network (BFLY) 10-Q SEC filing - Q2 FY2026 - Filed: Jul 30, 2026, 7:31 AM EDT - Fiscal quarter: Q2 FY2026 - Calendar quarter: Q2 2026 - Accession: 0001804176-26-000027 - OpenCapital page: https://www.opencapital.sh/filings/0001804176-26-000027 - Markdown URL: https://www.opencapital.sh/filings/0001804176-26-000027.md - Official SEC filing index: https://www.sec.gov/Archives/edgar/data/1804176/000180417626000027/0001804176-26-000027-index.htm ## Filing documents - [10-Q (bfly-20260630.htm)](https://www.sec.gov/Archives/edgar/data/1804176/000180417626000027/bfly-20260630.htm) - [EX-10.1 (bfly-20260630xex101.htm)](https://www.sec.gov/Archives/edgar/data/1804176/000180417626000027/bfly-20260630xex101.htm) - [EX-31.1 (bfly-20260630xex311.htm)](https://www.sec.gov/Archives/edgar/data/1804176/000180417626000027/bfly-20260630xex311.htm) - [EX-31.2 (bfly-20260630xex312.htm)](https://www.sec.gov/Archives/edgar/data/1804176/000180417626000027/bfly-20260630xex312.htm) - [EX-32.1 (bfly-20260630xex321.htm)](https://www.sec.gov/Archives/edgar/data/1804176/000180417626000027/bfly-20260630xex321.htm) --- ## 10-Q SEC source: [bfly-20260630.htm](https://www.sec.gov/Archives/edgar/data/1804176/000180417626000027/bfly-20260630.htm) UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2026 or o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __________ to Commission File Number: 001-39292 Butterfly Network, Inc. (Exact name of registrant as specified in its charter) | | | | --- | --- | | Delaware | 84-4618156 | | (State or other jurisdiction of incorporation or organization) | (IRS Employer Identification No.) | | 1600 District AvenueBurlington, Massachusetts | 01803 | | (Address of principal executive offices) | (Zip Code) | (781) 557-4800 (Registrant’s telephone number, including area code) Securities registered pursuant to Section 12(b) of the Act: Title of each class Trading Symbol(s) Name of each exchange on which registered Class A common stock, par value $0.0001 per share BFLY The New York Stock Exchange Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes   x No o Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes   x No o Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act. Large accelerated filer o Accelerated filer o Non-accelerated filer x Smaller reporting company x Emerging growth company o If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x As of July 24, 2026, the registrant had 244,858,246 shares of Class A common stock outstanding and 21,426,937 shares of Class B common stock outstanding. TABLE OF CONTENTS Page [Cautionary Statement Regarding Forward-Looking Statements](#ie4e8097a007347118754e76527a6eadf_10) [3](#ie4e8097a007347118754e76527a6eadf_10) [Part I](#ie4e8097a007347118754e76527a6eadf_13) [Financial Information](#ie4e8097a007347118754e76527a6eadf_13) [4](#ie4e8097a007347118754e76527a6eadf_13) [Item 1.](#ie4e8097a007347118754e76527a6eadf_16) [Financial Statements](#ie4e8097a007347118754e76527a6eadf_16) [4](#ie4e8097a007347118754e76527a6eadf_16) [Condensed Consolidated Balance Sheets (Unaudited)](#ie4e8097a007347118754e76527a6eadf_19) [4](#ie4e8097a007347118754e76527a6eadf_19) [Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited)](#ie4e8097a007347118754e76527a6eadf_22) [5](#ie4e8097a007347118754e76527a6eadf_22) [Condensed Consolidated Statements of Changes in Stockholders’ Equity (Unaudited)](#ie4e8097a007347118754e76527a6eadf_25) [6](#ie4e8097a007347118754e76527a6eadf_25) [Condensed Consolidated Statements of Cash Flows (Unaudited)](#ie4e8097a007347118754e76527a6eadf_34) [8](#ie4e8097a007347118754e76527a6eadf_34) [Notes to Condensed Consolidated Financial Statements (Unaudited)](#ie4e8097a007347118754e76527a6eadf_37) [9](#ie4e8097a007347118754e76527a6eadf_37) [Item 2.](#ie4e8097a007347118754e76527a6eadf_115) [Management’s Discussion and Analysis of Financial Condition and Results of Operations](#ie4e8097a007347118754e76527a6eadf_115) [20](#ie4e8097a007347118754e76527a6eadf_115) [Item 3.](#ie4e8097a007347118754e76527a6eadf_148) [Quantitative and Qualitative Disclosures About Market Risk](#ie4e8097a007347118754e76527a6eadf_148) [28](#ie4e8097a007347118754e76527a6eadf_148) [Item 4.](#ie4e8097a007347118754e76527a6eadf_151) [Controls and Procedures](#ie4e8097a007347118754e76527a6eadf_151) [28](#ie4e8097a007347118754e76527a6eadf_151) [Part II](#ie4e8097a007347118754e76527a6eadf_154) [Other Information](#ie4e8097a007347118754e76527a6eadf_154) [29](#ie4e8097a007347118754e76527a6eadf_154) [Item 1.](#ie4e8097a007347118754e76527a6eadf_157) [Legal Proceedings](#ie4e8097a007347118754e76527a6eadf_157) [29](#ie4e8097a007347118754e76527a6eadf_157) [Item 1A.](#ie4e8097a007347118754e76527a6eadf_160) [Risk Factors](#ie4e8097a007347118754e76527a6eadf_160) [29](#ie4e8097a007347118754e76527a6eadf_160) [Item 2.](#ie4e8097a007347118754e76527a6eadf_163) [Unregistered Sales of Equity Securities and Use of Proceeds](#ie4e8097a007347118754e76527a6eadf_163) [29](#ie4e8097a007347118754e76527a6eadf_163) [Item 5.](#ie4e8097a007347118754e76527a6eadf_166) [Other Information](#ie4e8097a007347118754e76527a6eadf_166) [29](#ie4e8097a007347118754e76527a6eadf_166) [Item 6.](#ie4e8097a007347118754e76527a6eadf_172) [Exhibits](#ie4e8097a007347118754e76527a6eadf_172) [29](#ie4e8097a007347118754e76527a6eadf_172) [Signatures](#ie4e8097a007347118754e76527a6eadf_175) [32](#ie4e8097a007347118754e76527a6eadf_175) In this Quarterly Report on Form 10-Q, the terms "we," "us," "our," the "Company," and "Butterfly" mean Butterfly Network, Inc. and our subsidiaries. CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS This Quarterly Report on Form 10-Q includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), that relate to future events or our future financial performance regarding, among other things, our plans, strategies, and prospects, both business and financial. These statements are based on the beliefs and assumptions of our management team. Generally, statements that are not historical facts, including statements concerning possible or assumed future actions, business strategies, events, or results of operations, are forward-looking statements. Forward-looking statements contained in this Quarterly Report on Form 10-Q include, but are not limited to, statements about: - the success, cost, and timing of our product development activities, including the development of additional potential products; - the potential attributes and benefits of our products and services; - our ability to obtain and maintain regulatory authorization for our products, and any related restrictions and limitations on the use of any authorized product; - our ability to identify, in-license, or acquire additional technology; - our ability to maintain our existing license, manufacturing, and supply agreements; - the success, cost, and timing of our efforts to out-license our intellectual property to third parties; - our ability to compete with other companies currently marketing or engaged in the development of ultrasound imaging devices, many of which have greater financial and marketing resources than us; - the size and growth potential of the markets for our products and services, and the ability of each to serve those markets, either alone or in partnership with others; - our estimates regarding expenses, revenue, capital requirements, and needs for additional financing; and - our financial performance. These statements may be preceded by, followed by, or include the words "believes," "estimates," "expects," "projects," "forecasts," "may," "will," "should," "seeks," "plans," "scheduled," "anticipates," or "intends" or similar expressions or phrases, or the negative of those expressions or phrases. The forward-looking statements are based on projections prepared by, and are the responsibility of, our management. Although we believe that our plans, intentions, and expectations reflected in or suggested by these forward-looking statements are reasonable, we cannot assure you that we will achieve or realize these plans, intentions, or expectations. Forward-looking statements are inherently subject to risks, uncertainties, and assumptions relating to, among other things: - our growth depends on our ability to attract and retain customers; - our business could be harmed if we fail to manage our growth effectively; - our current expectations and assumptions are subject to risks, assumptions, estimates, and uncertainties; - our business is subject to a variety of U.S. and foreign laws, which are subject to change and could adversely affect our business; - the pricing of our products and services, and reimbursement for medical procedures conducted using our medical products and services; - changes in applicable laws or regulations; - our ability to protect or enforce our intellectual property rights; and - economic downturns and political and market conditions beyond our control. These and other risks and uncertainties are described in greater detail under the caption "Risk Factors" in Item 1A of Part I of our Annual Report on Form 10-K for the year ended December 31, 2025 (the "2025 Annual Report on Form 10-K"), in Item 1A of Part II of this Quarterly Report on Form 10-Q, and in other filings that we make with the Securities and Exchange Commission ("SEC"). The risks described under the caption "Risk Factors" are not exhaustive. New risk factors emerge from time to time, and it is not possible to predict all such risk factors, nor can we assess the impact of all such risk factors on our business or the extent to which any factor or combination of factors may cause actual results to differ materially from those contained in any forward-looking statements. Forward-looking statements are not guarantees of performance. You should not put undue reliance on these statements, which speak only as of the date hereof. All forward-looking statements attributable to the Company or persons acting on the Company’s behalf are expressly qualified in their entirety by the foregoing cautionary statements. We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law. PART I — FINANCIAL INFORMATION ## Item 1. Financial Statements **BUTTERFLY NETWORK, INC.** ### CONDENSED CONSOLIDATED BALANCE SHEETS _(In thousands, except share and per share amounts) · (Unaudited)_ | Line item | June 30,2026 | December 31,2025 | | --- | --- | --- | | Assets | | | | Current assets: | | | | Cash and cash equivalents | $124,659 | $150,489 | | Accounts receivable, net of allowance for credit losses of $1,785 and $1,389 at June 30, 2026 and December 31, 2025, respectively | 34,554 | 26,744 | | Inventories | 58,559 | 61,389 | | Current portion of vendor advances | 2,157 | 2,063 | | Prepaid expenses and other current assets | 18,018 | 8,418 | | Total current assets | 237,947 | 249,103 | | Property and equipment, net | 15,850 | 16,587 | | Intangible assets, net | 6,816 | 7,516 | | Non-current portion of vendor advances | 4,868 | 5,008 | | Operating lease assets | 11,805 | 12,652 | | Other non-current assets | 5,709 | 5,667 | | Total assets | $282,995 | $296,533 | | Liabilities and stockholders’ equity | | | | Current liabilities: | | | | Accounts payable | $3,518 | $5,442 | | Deferred revenue, current | 15,472 | 26,909 | | Accrued purchase commitments, current | 131 | 131 | | Warrant liabilities, current | — | 413 | | Accrued expenses and other current liabilities | 39,482 | 32,222 | | Total current liabilities | 58,603 | 65,117 | | Deferred revenue, non-current | 10,185 | 9,391 | | Operating lease liabilities | 16,293 | 17,721 | | Other non-current liabilities | 8,514 | 8,325 | | Total liabilities | 93,595 | 100,554 | | Commitments and contingencies (Note 12) | | | | Stockholders’ equity: | | | | Class A common stock $0.0001 par value; 600,000,000 shares authorized at June 30, 2026 and December 31, 2025; 237,995,479 and 227,318,426 shares issued and outstanding at June 30, 2026 and December 31, 2025, respectively | 24 | 23 | | Class B common stock $0.0001 par value; 27,000,000 shares authorized at June 30, 2026 and December 31, 2025; 26,426,937 shares issued and outstanding at June 30, 2026 and December 31, 2025 | 3 | 3 | | Additional paid-in capital | 1,094,154 | 1,075,147 | | Accumulated deficit | (904,781) | (879,194) | | Total stockholders’ equity | 189,400 | 195,979 | | Total liabilities and stockholders’ equity | $282,995 | $296,533 | The accompanying notes are an integral part of these condensed consolidated financial statements. **BUTTERFLY NETWORK, INC.** ### CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS _(In thousands, except share and per share amounts) · (Unaudited)_ | Line item | Three months ended June 30, 2026 | Three months ended June 30, 2025 | Six months ended June 30, 2026 | Six months ended June 30, 2025 | | --- | --- | --- | --- | --- | | Revenue: | | | | | | Product | $15,720 | $16,621 | $30,373 | $30,785 | | Software and other services | 16,892 | 6,762 | 28,769 | 13,823 | | Total revenue | 32,612 | 23,383 | 59,142 | 44,608 | | Cost of revenue: | | | | | | Product | 7,370 | 6,670 | 13,725 | 12,494 | | Software and other services | 1,954 | 1,822 | 3,843 | 3,842 | | Total cost of revenue | 9,324 | 8,492 | 17,568 | 16,336 | | Gross profit | 23,288 | 14,891 | 41,574 | 28,272 | | Operating expenses: | | | | | | Research and development | 10,542 | 8,315 | 20,080 | 18,239 | | Sales and marketing | 11,467 | 11,559 | 22,884 | 23,179 | | General and administrative | 11,355 | 9,130 | 22,173 | 18,729 | | Other | 3,588 | 1,987 | 3,973 | 2,691 | | Total operating expenses | 36,952 | 30,991 | 69,110 | 62,838 | | Loss from operations | (13,664) | (16,100) | (27,536) | (34,566) | | Interest income | 1,079 | 1,503 | 2,265 | 3,155 | | Interest expense | (282) | (368) | (561) | (715) | | Change in fair value of warrant liabilities | — | 620 | 413 | 1,446 | | Other income (expense), net | (43) | 531 | (168) | 2,906 | | Loss before provision for income taxes | (12,910) | (13,814) | (25,587) | (27,774) | | Provision for income taxes | — | 20 | — | 27 | | Net loss and comprehensive loss | $(12,910) | $(13,834) | $(25,587) | $(27,801) | | Net loss per common share attributable to Class A and B common stockholders, basic and diluted | $(0.05) | $(0.06) | $(0.10) | $(0.12) | | Weighted-average shares used to compute net loss per share attributable to Class A and B common stockholders, basic and diluted | 262,100,993 | 248,393,811 | 259,324,052 | 241,695,884 | The accompanying notes are an integral part of these condensed consolidated financial statements. BUTTERFLY NETWORK, INC. CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (In thousands, except share amounts) (Unaudited) _Three months ended June 30, 2026_ | Line item | Class ACommon Stock / Shares | Class ACommon Stock / Amount | Class BCommon Stock / Shares | Class BCommon Stock / Amount | Additional Paid-In Capital | Accumulated Deficit | Total Stockholders’Equity | | --- | --- | --- | --- | --- | --- | --- | --- | | March 31, 2026 | 234,777,441 | $23 | 26,426,937 | $3 | $1,083,067 | $(891,871) | $191,222 | | Net loss | — | — | — | — | — | (12,910) | (12,910) | | Common stock issued upon exercise of stock options | 752,277 | — | — | — | 2,722 | — | 2,722 | | Common stock issued upon vesting of restricted stock units, net | 1,154,817 | 1 | — | — | (7) | — | (6) | | Common stock issued for employee stock purchase plan | 1,310,944 | — | — | — | 1,233 | — | 1,233 | | Stock-based compensation expense | — | — | — | — | 7,139 | — | 7,139 | | June 30, 2026 | 237,995,479 | $24 | 26,426,937 | $3 | $1,094,154 | $(904,781) | $189,400 | _Three months ended June 30, 2025_ | Line item | Class ACommon Stock / Shares | Class ACommon Stock / Amount | Class BCommon Stock / Shares | Class BCommon Stock / Amount | Additional Paid-In Capital | Accumulated Deficit | Total Stockholders’Equity | | --- | --- | --- | --- | --- | --- | --- | --- | | March 31, 2025 | 220,818,648 | $22 | 26,426,937 | $3 | $1,055,768 | $(816,097) | $239,696 | | Net loss | — | — | — | — | — | (13,834) | (13,834) | | Net proceeds from share offering | — | — | — | — | (104) | — | (104) | | Common stock issued upon exercise of stock options | 99,676 | — | — | — | 142 | — | 142 | | Common stock issued upon vesting of restricted stock units, net | 2,564,755 | — | — | — | — | — | — | | Common stock issued for employee stock purchase plan | 1,126,754 | — | — | — | 949 | — | 949 | | Stock-based compensation expense | — | — | — | — | 5,957 | — | 5,957 | | June 30, 2025 | 224,609,833 | $22 | 26,426,937 | $3 | $1,062,712 | $(829,931) | $232,806 | _Six months ended June 30, 2026_ | Line item | Class ACommon Stock / Shares | Class ACommon Stock / Amount | Class BCommon Stock / Shares | Class BCommon Stock / Amount | Additional Paid-In Capital | Accumulated Deficit | Total Stockholders’Equity | | --- | --- | --- | --- | --- | --- | --- | --- | | December 31, 2025 | 227,318,426 | $23 | 26,426,937 | $3 | $1,075,147 | $(879,194) | $195,979 | | Net loss | — | — | — | — | — | (25,587) | (25,587) | | Common stock issued upon exercise of stock options | 1,662,938 | — | — | — | 5,031 | — | 5,031 | | Common stock issued upon vesting of restricted stock units, net | 7,703,171 | 1 | — | — | (7) | — | (6) | | Common stock issued for employee stock purchase plan | 1,310,944 | — | — | — | 1,233 | — | 1,233 | | Stock-based compensation expense | — | — | — | — | 12,750 | — | 12,750 | | June 30, 2026 | 237,995,479 | $24 | 26,426,937 | $3 | $1,094,154 | $(904,781) | $189,400 | _Six months ended June 30, 2025_ | Line item | Class ACommon Stock / Shares | Class ACommon Stock / Amount | Class BCommon Stock / Shares | Class BCommon Stock / Amount | Additional Paid-In Capital | Accumulated Deficit | Total Stockholders’Equity | | --- | --- | --- | --- | --- | --- | --- | --- | | December 31, 2024 | 188,626,154 | $19 | 26,426,937 | $3 | $970,940 | $(802,130) | $168,832 | | Net loss | — | — | — | — | — | (27,801) | (27,801) | | Net proceeds from share offering | 27,600,000 | 3 | — | — | 81,003 | — | 81,006 | | Common stock issued upon exercise of stock options | 179,503 | — | — | — | 274 | — | 274 | | Common stock issued upon vesting of restricted stock units, net | 7,077,422 | — | — | — | (2,775) | — | (2,775) | | Common stock issued for employee stock purchase plan | 1,126,754 | — | — | — | 949 | — | 949 | | Stock-based compensation expense | — | — | — | — | 12,321 | — | 12,321 | | June 30, 2025 | 224,609,833 | $22 | 26,426,937 | $3 | $1,062,712 | $(829,931) | $232,806 | The accompanying notes are an integral part of these condensed consolidated financial statements. **BUTTERFLY NETWORK, INC.** ### CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS _(In thousands) · (Unaudited)_ | Line item | Six months ended June 30, 2026 | Six months ended June 30, 2025 | | --- | --- | --- | | Cash flows from operating activities: | | | | Net loss | $(25,587) | $(27,801) | | Adjustments to reconcile net loss to net cash used in operating activities: | | | | Depreciation, amortization, and impairments | 3,471 | 4,442 | | Non-cash interest expense | 561 | 713 | | Write-down of inventories | — | 66 | | Stock-based compensation expense | 12,580 | 12,148 | | Change in fair value of warrant liabilities | (413) | (1,446) | | Other | 834 | 172 | | Changes in operating assets and liabilities: | | | | Accounts receivable | (8,636) | (3,909) | | Inventories | 2,830 | 1,816 | | Prepaid expenses and other assets | (9,630) | (874) | | Vendor advances | 46 | 1,244 | | Accounts payable | (1,945) | (927) | | Deferred revenue | (10,643) | (581) | | Change in operating lease assets and liabilities | (455) | (411) | | Accrued expenses and other liabilities | 6,824 | (3,496) | | Net cash used in operating activities | (30,163) | (18,844) | | Cash flows from investing activities: | | | | Purchases of property, equipment, and intangible assets, including capitalized software | (1,924) | (1,249) | | Net cash used in investing activities | (1,924) | (1,249) | | Cash flows from financing activities: | | | | Proceeds from exercise of stock options | 5,031 | 274 | | Proceeds from employee stock purchase plan | 1,233 | 949 | | Net proceeds from share offering | — | 81,006 | | Payments to tax authorities for restricted stock units withheld | (7) | (2,775) | | Net cash provided by financing activities | 6,257 | 79,454 | | Net increase (decrease) in cash, cash equivalents, and restricted cash | (25,830) | 59,361 | | Cash, cash equivalents, and restricted cash, beginning of period | 154,504 | 92,790 | | Cash, cash equivalents, and restricted cash, end of period | $128,674 | $152,151 | The accompanying notes are an integral part of these condensed consolidated financial statements. BUTTERFLY NETWORK, INC. ### NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) ### Note 1. Organization and Description of Business Butterfly Network, Inc., formerly known as Longview Acquisition Corp. ("Longview"), was incorporated in Delaware on February 4, 2020. Following a business combination between the Company and BFLY Operations, Inc. (formerly Butterfly Network, Inc.) on February 12, 2021 (the "Business Combination"), the Company’s legal name became Butterfly Network, Inc. The Company is an innovative digital health business transforming care through a unique combination of portable, semiconductor-based ultrasound technology, intuitive software, services and educational offerings that can make medical imaging more accessible than ever before. Butterfly’s solution enables the practical application of ultrasound information into the clinical workflow through affordable hardware that fits in a healthcare professional’s pocket and is paired with cloud-connected software that is easily accessed through a mobile application. The Company also licenses its proprietary Ultrasound-on-Chip™ semiconductor platform for co-development of novel technologies in non-competitive markets through a program called Butterfly Embedded™ ("Embedded"). The Company operates wholly-owned subsidiaries in the United States, Australia, Germany, the Netherlands, Taiwan, and the United Kingdom. ### Note 2. Summary of Significant Accounting Policies Basis of Presentation and Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries and have been prepared in accordance with generally accepted accounting principles in the U.S. ("U.S. GAAP") and the accounting disclosure rules and regulations of the SEC regarding interim financial reporting. Certain information and note disclosures normally included in the annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the 2025 Annual Report on Form 10-K. All intercompany balances and transactions are eliminated upon consolidation. The condensed consolidated balance sheet as of December 31, 2025, included herein, was derived from the audited consolidated financial statements as of that date but does not include all disclosures, including certain notes, required by U.S. GAAP for annual reporting. In the opinion of management, the accompanying condensed consolidated financial statements reflect all normal and recurring adjustments necessary to present fairly the financial position, results of operations, and cash flows for the interim periods. The results for the three and six months ended June 30, 2026 are not necessarily indicative of the results to be expected for any subsequent quarter, the year ending December 31, 2026, or any other period. Use of Estimates The Company makes estimates and assumptions about future events that affect the amounts reported in its condensed consolidated financial statements and accompanying notes. Future events and their effects cannot be determined with certainty. On an ongoing basis, management evaluates these estimates and assumptions. The Company bases these estimates on historical and anticipated results and trends and on various other assumptions that the Company believes are reasonable under the circumstances, including assumptions about future events. Changes in estimates are recorded in the period in which they become known. Actual results could differ from those estimates, and any such differences may be material to the Company’s condensed consolidated financial statements. The Company revised its estimated liabilities for loss contingencies and recognized an insurance recovery asset during the three and six months ended June 30, 2026. For the three months ended June 30, 2026, the increase in the Company's estimated liabilities for loss contingencies was equal to the increase in the Company's insurance recovery asset, resulting in no net change to the Company's condensed consolidated statements of operations and comprehensive loss for the corresponding period. The following table summarizes the effects of the Company's revised estimates on captions in the condensed consolidated statements of operations and comprehensive loss (in thousands, except per-share amounts): | Line item | Three months ended June 30, 2026 | Six months ended June 30, 2026 | | --- | --- | --- | | Loss from operations | — | $2,750 | | Net loss and comprehensive loss | — | $2,750 | | Net loss per common share attributable to Class A and B common stockholders, basic and diluted | — | $0.01 | See Note 12 "Commitments and Contingencies" for additional information on the losses and loss recovery related to these estimated liabilities and insurance recovery asset, respectively. There have been no other material changes to the Company’s use of estimates as described in the consolidated financial statements for the year ended December 31, 2025. Concentration of Credit Risk Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash and cash equivalents and accounts receivable. As of June 30, 2026, substantially all of the Company’s cash and cash equivalents were invested in money market accounts with one financial institution. The Company also maintains balances in various operating accounts above federally insured limits. The Company has not experienced any significant losses on such accounts and does not believe it is exposed to any significant credit risk on its cash and cash equivalents. As of June 30, 2026 and December 31, 2025, no customers accounted for more than 10% of the Company’s accounts receivable. For the three and six months ended June 30, 2026, one customer accounted for more than 10% of the Company’s total revenue. For the three and six months ended June 30, 2025, no customers accounted for more than 10% of the Company’s total revenue. Segment Information The Company has determined that it operates in one reportable segment, which includes all activities related to the development, manufacture, and sale of the Company's products, software, and other services. The Company’s chief operating decision maker ("CODM"), its Chief Executive Officer, regularly reviews the Company's consolidated net loss, which is reported as net loss and comprehensive loss on the condensed consolidated statements of operations and comprehensive loss, for purposes of evaluating the Company's financial performance, including reviewing budget versus actual results, and determining changes in the Company's allocation of resources across the Company's strategic initiatives. The Company's measure of segment assets is total assets, as reported on the condensed consolidated balance sheets, and substantially all of the Company’s long-lived assets are located in the United States. In addition to the operating expenses presented on the condensed consolidated statements of operations and comprehensive loss, the CODM also reviews certain significant segment expenses. The following table summarizes the Company's segment revenue and significant segment expenses included in consolidated net loss (in thousands): | Line item | Three months ended June 30, 2026 | Three months ended June 30, 2025 | Six months ended June 30, 2026 | Six months ended June 30, 2025 | | --- | --- | --- | --- | --- | | Revenue | $32,612 | $23,383 | $59,142 | $44,608 | | Less: | | | | | | Cost of revenue (excluding write-downs of inventories and vendor advances) | 9,324 | 8,478 | 17,568 | 16,270 | | Write-downs of inventories and vendor advances | — | 14 | — | 66 | | Payroll operating expenses | 14,790 | 12,958 | 30,092 | 27,466 | | Stock-based compensation operating expenses | 6,891 | 5,864 | 12,303 | 12,148 | | Non-payroll operating expenses | 11,683 | 10,182 | 22,742 | 20,533 | | Other | 3,588 | 1,987 | 3,973 | 2,691 | | Other segment items | (754) | (2,266) | (1,949) | (6,765) | | Net loss | $(12,910) | $(13,834) | $(25,587) | $(27,801) | Other segment items include interest income, interest expense, the change in fair value of warrant liabilities, other income (expense), net, and the provision for income taxes. Because the Company operates in one reportable segment, other required segment disclosures are included on the Company's condensed consolidated financial statements. Interest income, interest expense, and the provision for income taxes are included on the condensed consolidated statements of operations and comprehensive loss. Depreciation, amortization, and impairments; write-down of inventories; and purchases of property, equipment, and intangible assets, including capitalized software, are included on the condensed consolidated statements of cash flows. Allowance for Credit Losses The following table summarizes activity in the Company's allowance for credit losses (in thousands): | Line item | Three months ended June 30, 2026 | Three months ended June 30, 2025 | Six months ended June 30, 2026 | Six months ended June 30, 2025 | | --- | --- | --- | --- | --- | | Balance, beginning of period | $1,180 | $2,716 | $1,389 | $2,583 | | Provision for expected credit losses | 702 | 121 | 826 | 368 | | Write-offs | (97) | (111) | (430) | (225) | | Balance, end of period | $1,785 | $2,726 | $1,785 | $2,726 | Operating Expenses – Other The Company classifies certain operating expenses that are not representative of its ongoing operations as other on the condensed consolidated statements of operations and comprehensive loss. These include costs related to the Company’s reductions in force, litigation costs, loss contingencies related to ongoing litigation, and legal settlements. The following table summarizes the types of expenses classified as other in the Company’s condensed consolidated statements of operations and comprehensive loss (in thousands): | Line item | Three months ended June 30, 2026 | Three months ended June 30, 2025 | Six months ended June 30, 2026 | Six months ended June 30, 2025 | | --- | --- | --- | --- | --- | | Employment-related expenses | $51 | $488 | $338 | $520 | | Legal-related expenses | 3,537 | 1,499 | 3,635 | 2,171 | | Total other | $3,588 | $1,987 | $3,973 | $2,691 | Recent Accounting Pronouncements Issued but Not Yet Adopted The Company considers the applicability and impact of all Accounting Standards Updates ("ASUs") issued by the Financial Accounting Standards Board ("FASB"). ASUs not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on the Company’s consolidated financial statements. In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which introduced new guidance on disclosures of specified information about certain costs and expenses included within expenses presented on the face of the income statements, such as purchases of inventory and employee compensation. This guidance is effective for the Company for annual reporting periods beginning January 1, 2027 and interim reporting periods beginning January 1, 2028. The Company is currently evaluating the impact that the adoption of this pronouncement will have on the Company's consolidated financial statements and disclosures. In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which introduced new guidance to modernize the accounting for internal-use software development costs by removing references to prescriptive and sequential software development stages and providing additional considerations when evaluating the probable-to-complete recognition threshold. This guidance is effective for the Company for both annual and interim periods beginning January 1, 2028. The new guidance may be adopted using either a prospective, modified, or retrospective transition approach. The Company is currently evaluating the impact that the adoption of this pronouncement will have on the Company's consolidated financial statements and disclosures, including which transition approach the Company expects to use. ### Note 3. Revenue Recognition Disaggregation of Revenue The Company disaggregates revenue from contracts with customers by type of good or service, geographical market, and business line. For the business line disaggregation, the Company considers revenue from its core business to be all revenue generated by activities outside of its Embedded business line. The Company believes that these categories aggregate the payor types by nature, amount, timing, and uncertainty of its revenue streams. The following table summarizes the Company’s disaggregated revenue (in thousands): | Line item | Pattern of Recognition | Three months ended June 30, 2026 | Three months ended June 30, 2025 | Six months ended June 30, 2026 | Six months ended June 30, 2025 | | --- | --- | --- | --- | --- | --- | | By type of good or service: | | | | | | | Product | Point-in-time | $15,720 | $16,621 | $30,373 | $30,785 | | Software and other services | Over time | 16,892 | 6,762 | 28,769 | 13,823 | | Total revenue | | $32,612 | $23,383 | $59,142 | $44,608 | | By geographical market: | | | | | | | United States | | $27,591 | $17,540 | $48,954 | $34,579 | | International | | 5,021 | 5,843 | 10,188 | 10,029 | | Total revenue | | $32,612 | $23,383 | $59,142 | $44,608 | | By business line: | | | | | | | Core business | | $21,851 | $21,387 | $42,646 | $40,303 | | Embedded | | 10,761 | 1,996 | 16,496 | 4,305 | | Total revenue | | $32,612 | $23,383 | $59,142 | $44,608 | Contract Balances Contract balances represent amounts presented in the condensed consolidated balance sheets when the Company has either transferred goods or services to the customer or the customer has paid consideration to the Company under the contract. These contract balances include trade accounts receivable and deferred revenue. The Company recognizes a receivable when it has an unconditional right to payment, and payment terms are typically 30 to 90 days for sales on credit of product, software, and other services. For the three months ended June 30, 2026 and 2025, the Company recognized $14.3 million and $5.6 million, respectively, of revenue that was included in the deferred revenue balance at the beginning of the period. For the six months ended June 30, 2026 and 2025, the Company recognized $22.2 million and $11.2 million, respectively, of revenue that was included in the deferred revenue balance at the beginning of the period. Transaction Price Allocated to Remaining Performance Obligations As of June 30, 2026 and December 31, 2025, the Company had $85.8 million and $99.6 million, respectively, of remaining performance obligations. As of June 30, 2026, the Company expects to recognize 60% of its remaining performance obligations as revenue in the next twelve months and an additional 40% thereafter. ### Note 4. Fair Value of Financial Instruments Fair value estimates of financial instruments are made at a specific point in time, based on relevant information about financial markets and specific financial instruments. As these estimates are subjective in nature, involving uncertainties and matters of significant judgment, they cannot be determined with precision. Changes in assumptions can significantly affect estimated fair value. The Company measures fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. The Company utilizes a three-tier hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: - Level 1 — Valuations based on quoted prices in active markets for identical assets or liabilities that an entity has the ability to access. - Level 2 — Valuations based on quoted prices for similar assets or liabilities, quoted prices for identical assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets or liabilities. - Level 3 — Valuations based on inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company has no assets or liabilities valued with Level 3 inputs. The carrying values of cash and cash equivalents, accounts receivable, accounts payable, and accrued expenses approximate their fair values due to the short-term or on-demand nature of these instruments. There were no transfers between fair value measurement levels during the periods ended June 30, 2026 and December 31, 2025. All of the Company’s unexercised warrants expired at the end of their contractual exercise period on February 12, 2026. These warrants included publicly traded warrants (the "Public Warrants"), which were issued as one-third of a warrant per unit during Longview’s initial public offering, and warrants sold in a private placement to Longview’s sponsor (the "Private Warrants"). Each whole warrant entitled the registered holder to purchase one share of Class A common stock at an exercise price of $11.50 per share, subject to adjustment per the warrant agreements. The Company recognizes the change in fair value of warrant liabilities in the condensed consolidated statements of operations and comprehensive loss. No warrants were exercised during the three and six months ended June 30, 2026 and 2025. The Company measured its Public Warrants using Level 1 fair value inputs based on quoted prices in active markets for the Public Warrants. Because any transfer of Private Warrants from the initial holder of the Private Warrants would result in the Private Warrants having substantially the same terms as the Public Warrants, management determined that the fair value of each Private Warrant was the same as that of a Public Warrant. Accordingly, the Company measured its Private Warrants using Level 2 fair value inputs based on quoted prices in active markets for the Public Warrants. The Company did not have any assets and liabilities that are measured at fair value on a recurring basis as of June 30, 2026. The following table summarizes the Company’s assets and liabilities that are measured at fair value on a recurring basis as of December 31, 2025, by level within the fair value hierarchy (in thousands): | Line item | Total | Fair Value Measurement Level / Level 1 | Fair Value Measurement Level / Level 2 | Fair Value Measurement Level / Level 3 | | --- | --- | --- | --- | --- | | Warrants: | | | | | | Public Warrants | $276 | $276 | — | — | | Private Warrants | 137 | — | 137 | — | | Total liabilities at fair value on a recurring basis | $413 | $276 | $137 | — | ### Note 5. Inventories The following table summarizes the Company’s inventories (in thousands): | Line item | June 30,2026 | December 31,2025 | | --- | --- | --- | | Raw materials | $37,527 | $37,865 | | Work-in-progress | 7,250 | 5,051 | | Finished goods | 13,782 | 18,473 | | Total inventories | $58,559 | $61,389 | Work-in-progress represents inventory items in intermediate stages of production by third-party manufacturers. For the three and six months ended June 30, 2026 and June 30, 2025, net realizable value inventory adjustments and excess and obsolete inventory charges were not significant and were recognized in product cost of revenue. See Note 12 "Commitments and Contingencies" for additional information regarding the Company’s inventory supply arrangements. ### Note 6. Property and Equipment, Net The following table summarizes the Company’s property and equipment, net (in thousands): | Line item | June 30,2026 | December 31,2025 | | --- | --- | --- | | Property and equipment, gross | $51,437 | $49,871 | | Less: accumulated depreciation and amortization | (35,587) | (33,284) | | Property and equipment, net | $15,850 | $16,587 | ### Note 7. Restricted Cash The following table reconciles cash, cash equivalents, and restricted cash from the condensed consolidated balance sheets to the condensed consolidated statements of cash flows (in thousands): | Line item | June 30, 2026 | June 30, 2025 | | --- | --- | --- | | Reconciliation of cash, cash equivalents and restricted cash: | | | | Cash and cash equivalents | $124,659 | $148,136 | | Restricted cash included within other non-current assets | 4,015 | 4,015 | | Total cash, cash equivalents and restricted cash shown in the condensed consolidated statements of cash flows | $128,674 | $152,151 | Restricted cash included within other non-current assets is held as collateral to secure a letter of credit for one of our office leases and is expected to be maintained as a security deposit throughout the duration of the lease. ### Note 8. Accrued Expenses and Other Current Liabilities The following table summarizes the Company’s accrued expenses and other current liabilities (in thousands): | Line item | June 30,2026 | December 31,2025 | | --- | --- | --- | | Employee compensation | $6,633 | $11,148 | | Customer deposits | 2,281 | 2,286 | | Accrued warranty liability | 472 | 501 | | Non-income tax | 2,328 | 2,478 | | Professional fees | 6,902 | 3,121 | | Current portion of operating lease liabilities | 2,804 | 2,677 | | Estimated liabilities for loss contingencies | 10,250 | 3,000 | | Other | 7,812 | 7,011 | | Total accrued expenses and other current liabilities | $39,482 | $32,222 | The following table summarizes warranty expense activity (in thousands): | Line item | Three months ended June 30, 2026 | Three months ended June 30, 2025 | Six months ended June 30, 2026 | Six months ended June 30, 2025 | | --- | --- | --- | --- | --- | | Balance, beginning of period | $1,546 | $735 | $1,343 | $1,023 | | Warranty provision charged to operations | 487 | 495 | 1,015 | 462 | | Warranty claims | (316) | (314) | (641) | (569) | | Balance, end of period | $1,717 | $916 | $1,717 | $916 | The Company classifies its accrued warranty liability based on the timing of expected warranty activity. The future costs of expected activity greater than one year are recorded within other non-current liabilities on the condensed consolidated balance sheets. ### Note 9. Stock-Based Compensation Equity Incentive Plans For the three and six months ended June 30, 2026, there were no significant changes to the Company’s 2012 Employee, Director and Consultant Equity Incentive Plan, as amended, (the "2012 Plan") and the Company’s Amended and Restated 2020 Equity Incentive Plan (the "2020 Plan"). On January 1, 2026, pursuant to the terms of the 2020 Plan, the number of shares reserved for issuance was increased automatically by 4% of the number of outstanding shares of common stock as of January 1, 2026. Stock Option Activity The following table summarizes the changes in the Company’s outstanding stock options: | Line item | Number of Options | | --- | --- | | Outstanding at December 31, 2025 | 5,551,227 | | Granted | — | | Exercised | (1,662,938) | | Forfeited | (1,706,317) | | Outstanding at June 30, 2026 | 2,181,972 | Generally, each award vests based on continued service per the award agreement. The grant date fair value of the award is recognized as stock-based compensation expense over the requisite service period. The grant date fair value was determined using similar methods and assumptions as those previously disclosed by the Company. Restricted Stock Unit Activity The following table summarizes the changes in the Company’s outstanding restricted stock units ("RSUs"): | Line item | Number of RSUs | | --- | --- | | Outstanding at December 31, 2025 | 21,538,563 | | Granted | 8,016,481 | | Vested | (7,704,480) | | Forfeited | (1,649,105) | | Outstanding at June 30, 2026 | 20,201,459 | Generally, each award vests based on continued service per the award agreement. The grant date fair value of the award is recognized as stock-based compensation expense over the requisite service period. The grant date fair value was determined based on the fair market value of the Company’s Class A common stock on the grant date. Included in the table above are market-based RSUs granted between 2023 and 2025 that include a service condition. The market-based conditions for these awards are objective metrics related to the Company’s stock price defined in the award agreements. The service condition for these awards is satisfied by providing service to the Company through the achievement date of the market-based conditions. The grant date fair value of the awards is recognized as stock-based compensation expense over the derived service period. The grant date fair value and derived service period were determined by using a Monte Carlo simulation with similar assumptions as those previously disclosed by the Company. Employee Stock Purchase Plan For the three and six months ended June 30, 2026, there were no significant changes to the Company’s 2024 Employee Stock Purchase Plan (the “ESPP”). On January 1, 2026, pursuant to the terms of the ESPP, the number of shares reserved for issuance was increased automatically by 1% of the number of shares of common stock issued and outstanding on December 31, 2023. 1.3 million and 1.1 million shares of common stock were issued under the ESPP during each of the three and six months ended June 30, 2026 and 2025, respectively. Stock-Based Compensation Expense The following table summarizes the Company’s stock-based compensation expense (in thousands): | Line item | Three months ended June 30, 2026 | Three months ended June 30, 2025 | Six months ended June 30, 2026 | Six months ended June 30, 2025 | | --- | --- | --- | --- | --- | | Cost of revenue – software and other services | $147 | — | $277 | — | | Research and development | 1,927 | 1,447 | 3,475 | 3,696 | | Sales and marketing | 1,943 | 2,076 | 3,452 | 3,796 | | General and administrative | 3,021 | 2,341 | 5,376 | 4,656 | | Total stock-based compensation expense | $7,038 | $5,864 | $12,580 | $12,148 | ### Note 10. Net Loss Per Share We compute net loss per share of Class A and Class B common stock using the two-class method. Basic net loss per share is computed by dividing the net loss by the weighted-average number of shares of each class of the Company’s common stock outstanding during the period. Diluted net loss per share is computed by giving effect to all potential shares of the Company’s common stock, including those presented in the table below, to the extent dilutive. Basic and diluted net loss per share were the same for each period presented as the inclusion of all potential shares of the Company’s common stock outstanding would have been anti-dilutive. As the Company uses the two-class method required for companies with multiple classes of common stock, the following tables present the calculation of basic and diluted net loss per share for each class of the Company’s common stock outstanding (in thousands, except share and per share amounts): | Three months ended June 30, 2026 | Class A | Class B | Total Common Stock | | --- | --- | --- | --- | | Numerator: | | | | | Allocation of undistributed earnings | $(11,608) | $(1,302) | $(12,910) | | Numerator for basic and diluted net loss per share – loss available to common stockholders | $(11,608) | $(1,302) | $(12,910) | | Denominator: | | | | | Weighted-average common shares outstanding | 235,674,056 | 26,426,937 | 262,100,993 | | Denominator for basic and diluted net loss per share – weighted-average common stock | 235,674,056 | 26,426,937 | 262,100,993 | | Basic and diluted net loss per share | $(0.05) | $(0.05) | $(0.05) | | Three months ended June 30, 2025 | Class A | Class B | Total Common Stock | | --- | --- | --- | --- | | Numerator: | | | | | Allocation of undistributed earnings | $(12,362) | $(1,472) | $(13,834) | | Numerator for basic and diluted net loss per share – loss available to common stockholders | $(12,362) | $(1,472) | $(13,834) | | Denominator: | | | | | Weighted-average common shares outstanding | 221,966,874 | 26,426,937 | 248,393,811 | | Denominator for basic and diluted net loss per share – weighted-average common stock | 221,966,874 | 26,426,937 | 248,393,811 | | Basic and diluted net loss per share | $(0.06) | $(0.06) | $(0.06) | | Six months ended June 30, 2026 | Class A | Class B | Total Common Stock | | --- | --- | --- | --- | | Numerator: | | | | | Allocation of undistributed earnings | $(22,980) | $(2,607) | $(25,587) | | Numerator for basic and diluted net loss per share – loss available to common stockholders | $(22,980) | $(2,607) | $(25,587) | | Denominator: | | | | | Weighted-average common shares outstanding | 232,897,115 | 26,426,937 | 259,324,052 | | Denominator for basic and diluted net loss per share – weighted-average common stock | 232,897,115 | 26,426,937 | 259,324,052 | | Basic and diluted net loss per share | $(0.10) | $(0.10) | $(0.10) | | Six months ended June 30, 2025 | Class A | Class B | Total Common Stock | | --- | --- | --- | --- | | Numerator: | | | | | Allocation of undistributed earnings | $(24,761) | $(3,040) | $(27,801) | | Numerator for basic and diluted net loss per share – loss available to common stockholders | $(24,761) | $(3,040) | $(27,801) | | Denominator: | | | | | Weighted-average common shares outstanding | 215,268,947 | 26,426,937 | 241,695,884 | | Denominator for basic and diluted net loss per share – weighted-average common stock | 215,268,947 | 26,426,937 | 241,695,884 | | Basic and diluted net loss per share | $(0.12) | $(0.12) | $(0.12) | For the periods presented above, the net loss per share amounts are the same for Class A and Class B common stock because the holders of each class are entitled to equal per share dividends or distributions in liquidation in accordance with the Company's certificate of incorporation, as amended and restated. The undistributed earnings for each year are allocated based on the contractual participation rights of the Class A and Class B common stock as if the earnings for the year had been distributed. As the liquidation and dividend rights are identical, the undistributed earnings are allocated on a proportionate basis. The following table summarizes the Company’s anti-dilutive common equivalent shares: | Line item | June 30, 2026 | June 30, 2025 | | --- | --- | --- | | Outstanding options to purchase common stock | 2,181,972 | 6,057,038 | | Outstanding restricted stock units | 20,201,459 | 20,451,491 | | Outstanding employee stock purchase plan options | 424,895 | 1,949,593 | | Outstanding warrants | — | 20,652,690 | | Total anti-dilutive common equivalent shares | 22,808,326 | 49,110,812 | Subsequent to June 30, 2026, 5.0 million shares of the Company's issued and outstanding Class B common stock were automatically converted into Class A common stock, on a one-to-one basis, upon sale. ### Note 11. 401(k) Retirement Plan The Company sponsors a 401(k) defined contribution plan covering all eligible U.S. employees. Contributions to the 401(k) plan are discretionary. For the three months ended June 30, 2026 and 2025, expenses for matching 401(k) contributions were $0.1 million and $0.1 million, respectively. For the six months ended June 30, 2026 and 2025, expenses for matching 401(k) contributions were $0.3 million and $0.3 million, respectively. ### Note 12. Commitments and Contingencies Commitments Leases: The Company primarily enters into leases for office space that are classified as operating leases. For the three months ended June 30, 2026 and 2025, total lease cost was $0.7 million and $0.7 million, respectively. For the six months ended June 30, 2026 and 2025, total lease cost was $1.5 million and $1.4 million, respectively. Total lease cost was primarily composed of operating lease costs. Purchase Commitments: The Company enters into inventory purchase commitments with third-party manufacturers in the ordinary course of business, including a non-cancellable inventory supply agreement with a certain third-party manufacturing vendor. The provisions of the agreement allowed the Company, once it reached a certain cumulative purchase threshold in the fourth quarter of 2021, to pay for a portion of the subsequent inventory purchases using an advance previously paid to the vendor. As of June 30, 2026, the aggregate amount of minimum inventory purchase commitments is $2.0 million, and the Company has a vendor advance asset of $0.4 million, net of write-downs, and an accrued purchase commitment liability of $0.1 million related to the agreement. The portion of the balances that is expected to be utilized in the next 12 months is included in current assets and current liabilities in the accompanying condensed consolidated balance sheets. The Company applied the guidance in Accounting Standards Codification Topic 330, Inventory to assess the purchase commitment and related loss, using such factors as Company-specific forecasts which are reliant on the Company’s limited sales history, agreement-specific provisions, macroeconomic factors, and market and industry trends. For the three and six months ended June 30, 2026 and 2025, the Company did not recognize any additions to the accrued purchase commitment liability, or any related losses, based on its purchase commitment assessment as there were no significant changes to the assessment factors. The Company reviews its inventory on hand, including inventory acquired under the purchase commitments, for excess and obsolescence ("E&O") on a quarterly basis. Any E&O inventory acquired that was previously accounted for as a purchase commitment liability accrual or vendor advance write down is recorded at zero value. During the three and six months ended June 30, 2026 and 2025, the Company did not acquire a significant amount of such E&O inventory. Contingencies The Company is involved in litigation and legal matters from time to time, which have arisen in the normal course of business. The Company accrues an estimated liability for legal contingencies when the Company considers a potential loss probable and can reasonably estimate the amount of the potential loss. Although the ultimate results of these matters are not currently determinable, management does not expect that they will have a material effect on the Company’s condensed consolidated balance sheets, statements of operations and comprehensive loss, or statements of cash flows. On February 16, 2022, a putative class action lawsuit, styled Rose v. Butterfly Network, Inc., et al. was filed in the United States District Court for the District of New Jersey. The claims are against the Company and certain of its directors and previous management as well as members of the board of directors of the Company prior to the completion of the Business Combination, alleging that the defendants made false and misleading statements and/or omissions about its post-Business Combination business and financial prospects. The alleged class consists of all persons or entities who purchased or otherwise acquired the Company’s stock between January 12, 2021 and November 15, 2021, persons who exchanged Longview shares for the Company’s common stock, and persons who purchased Longview stock pursuant, or traceable to, the Proxy/Registration Statement on Form S-4 filed with the SEC on November 27, 2020 or any amendment thereto. The Company intends to vigorously defend against this action. The lawsuit seeks unspecified damages, together with interest thereon, as well as the costs and expenses of litigation. There is no assurance that the Company will be successful in the defense of the litigation or that insurance will be available or adequate to fund any potential settlement or judgment or the litigation costs of the action. During the six months ended June 30, 2026, the Company recognized an estimated liability of $0.3 million for a loss contingency in connection with this litigation. There were no changes to the Company's estimate during the three months ended June 30, 2026. The estimated liability is included in accrued expenses and other current liabilities on the condensed consolidated balance sheets, and the estimated loss is included in other on the condensed consolidated statements of operations and comprehensive loss. On June 21, 2022, a stockholder derivative action, styled Koenig v. Todd M. Fruchterman, et al. was filed in the United States District Court for the District of Delaware against the Company’s board of directors and the Company as nominal defendant. On November 28, 2023, a stockholder derivative action, styled Bhavsar v. Todd M. Fruchterman, et al. was filed in the United States District Court for the District of Delaware against the board of directors and the Company as nominal defendant. Both these actions allege violation of Section 14(a) of the Exchange Act, as amended, and Rule 14a-9 promulgated thereunder, and claims for breach of fiduciary duty, contribution and indemnification, aiding and abetting, and gross mismanagement. The lawsuits are premised upon allegedly inadequate internal controls and purportedly misleading representations regarding the Company’s financial condition, business prospects, and the Company’s November 2021 earnings announcement. The Company intends to vigorously defend against these actions. The lawsuit seeks unspecified damages, disgorgement, and restitution, together with interest thereon, as well as the costs and expenses of litigation. There is no assurance that the Company will be successful in the defense of the litigation or that insurance will be available or adequate to fund any potential settlement or judgment or the litigation costs of the action. The Company is unable to predict the outcome or reasonably estimate a range of possible loss at this time. In the ongoing civil action styled Sezonov v. Longview Investors LLC, et al., a stockholder is pursuing claims on behalf of a putative class action arising from the Business Combination. The stockholder filed her complaint on December 13, 2023 in the Court of Chancery of the State of Delaware against two entities affiliated with Longview, and four former members of the Longview board of directors (including Mr. Robbins, who also is a current member of the Company’s board of directors). The complaint asserts claims for breaches of fiduciary duty, unjust enrichment, civil conspiracy and aiding and abetting breaches of fiduciary duty, and seeks unspecified damages. The case is currently in the discovery phase, and has not yet reached the class certification stage. The Company has produced documents to the plaintiff in the case pursuant to a non-party subpoena. The Company’s understanding is that the defendants in this action intend to continue to vigorously defend the claims pending against them. There is no assurance that the defendants will be successful in the defense of the litigation, or that insurance will be available or adequate to fund any potential settlement or judgment or the litigation costs of the action. In the event that such insurance is not available or adequate, the Company has indemnification obligations to certain defendants in the case that may be implicated later. During the three and six months ended June 30, 2026, the Company recognized increases of $4.0 million and $7.0 million, respectively, to its estimated liability for a loss contingency in connection with this indemnification obligation. During the six months ended June 30, 2026, the Company also recognized a related $10.0 million insurance recovery asset, which includes an increase of $4.0 million during the three months ended June 30, 2026, that the Company has deemed probable and estimable. As of June 30, 2026, the total estimated liability for such loss contingency is $10.0 million, and the total related insurance recovery asset is $10.0 million. The estimated liability is included in accrued expenses and other current liabilities on the condensed consolidated balance sheets, the insurance recovery asset is included in prepaid expenses and other current assets on the condensed consolidated balance sheets, and both the estimated loss and loss recovery are included in other on the condensed consolidated statements of operations and comprehensive loss. ## Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis provides information which management believes is relevant to an assessment and understanding of our condensed consolidated results of operations and financial condition. The discussion should be read in conjunction with the unaudited condensed consolidated financial statements and notes thereto contained in this Quarterly Report on Form 10-Q and the consolidated financial statements and notes thereto contained in our 2025 Annual Report on Form 10-K. This discussion contains forward-looking statements and involves numerous risks and uncertainties, including, but not limited to, those described under the caption "Risk Factors" in Item 1A of Part I of our 2025 Annual Report on Form 10-K. Actual results may differ materially from those contained in any forward-looking statements. ### Overview We are an innovative digital health business transforming care through a unique combination of portable, semiconductor-based ultrasound technology, intuitive software, services, and educational offerings that can make medical imaging more accessible than ever before. Butterfly’s solution enables the practical application of ultrasound information into the clinical workflow through affordable hardware that fits in a healthcare professional’s pocket and is paired with cloud-connected software that is easily accessed through a mobile application. Butterfly developed ultrasound devices that can perform whole-body imaging in a single handheld probe because they are powered by our proprietary semiconductor technology instead of piezoelectric crystals. Our Ultrasound-on-Chip™ makes ultrasound more accessible outside of large healthcare institutions, while our software is intended to make the product easy to use, fully integrated with the clinical workflow, and accessible on a user’s smartphone, tablet, and almost any hospital computer system connected to the Internet. We aim to enable the delivery of imaging information anywhere at point-of-care to drive earlier detection throughout the body and remote management of health conditions. We market and sell the Butterfly system, which includes probes, related accessories, and software subscriptions (which we refer to herein as our "core business"), to healthcare systems, physicians, and healthcare providers through a direct sales force, distributors, and our eCommerce channel. We also license our proprietary Ultrasound-on-Chip™ semiconductor platform for co-development of novel technologies in non-competitive markets through our Embedded program. ### Key Performance Measures We review the key performance measures discussed below to evaluate the business and measure performance, identify trends, formulate plans, and make strategic decisions. Our key performance measures may fluctuate over time as the adoption of our devices increases, which may shift the revenue mix more toward software and other services. The quarterly measures may be impacted by the timing of device sales. Units fulfilled We define units fulfilled as the number of devices whereby control is transferred to a customer. We do not adjust this measure for returns as our volume of returns has historically been low. We view units fulfilled as a key indicator of the growth of our business. We believe that this measure is useful to investors because it presents our core growth and the performance of our business period over period. For the three months ended Units fulfilled increased by 1,176 units, or 22.5%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. The increase was largely driven by higher probe sales volume in the U.S. through direct sales to health systems and medical schools as well as our eCommerce sales channel. Software and other services mix We define software and other services mix as a percentage of our total revenue recognized in a reporting period that is based on software subscriptions and other related services, consisting primarily of our software as a service ("SaaS") offering. We view software and other services mix as a key indicator of the profitability of our business, and thus we believe that this measure is useful to investors. Software and other services mix increased by 22.9 percentage points, to 51.8%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. This increase was primarily driven by increases in software and other services revenue generated by our Embedded partnerships, including our co-development partnership with Midjourney, Inc. ### Description of Certain Components of Financial Data Revenue Product revenue consists of revenue from the sale of products, such as medical devices, accessories, and semiconductor chips. Our software and other services revenue consists of revenue from the sale of SaaS subscriptions, extended warranties, services related to our Embedded partnerships, implementation and integration services, and software development kits ("SDKs"), which may be perpetual or term-based. SaaS subscriptions include licenses for teams and individuals as well as enterprise-level subscriptions. Services related to our Embedded partnerships include out-licensing arrangements and related research and development services. For sales of products and perpetual SDKs, revenue is recognized at a point in time upon transfer of control to the customer. Sales of SaaS subscriptions, extended warranties, and term-based SDKs are generally related to stand-ready obligations or continued provision of access, and the revenue for those offerings is recognized ratably over time. For sales of services related to our Embedded partnerships and implementation and integration services, revenue is recognized over time using input methods to determine a measure of progress. Over time, as adoption of our devices increases through further market penetration, as practitioners in the Butterfly network continue to use our devices, and as our Embedded collaborations continue to grow and develop, we expect our annual revenue mix to shift more toward software and other services. The quarterly revenue mix may be impacted by the timing of device sales. To date, we have invested in building out our commercial footprint, with the ultimate goal of growing adoption at large-scale healthcare systems and driving awareness of the usability of ultrasound. As we expand our healthcare system software offerings and develop relationships with larger healthcare systems, we continue to expect a higher proportion of our sales in healthcare systems compared to eCommerce. Cost of revenue Cost of product revenue includes manufacturing costs, personnel costs and benefits, inbound freight, packaging, warranty replacement costs, royalty fees for licensed intellectual property, payment processing fees, and inventory obsolescence and write-offs. We expect our cost of product revenue to fluctuate over time due to the level of units fulfilled in any given period and to fluctuate as a percentage of product revenue over time as our focus on operational efficiencies in our supply chain may be offset by increased prices of certain inventory components. Cost of software and other services revenue includes personnel costs, cloud hosting costs, and payment processing fees. Because the costs and associated expenses to deliver our software and other service offerings are less than the costs and associated expenses of manufacturing and selling our products, we anticipate an improvement in profitability and margin expansion over time as our revenue mix shifts increasingly towards software and other services. We plan to continue to invest additional resources to expand and further develop our SaaS and other service offerings which will be reflected in cost of revenue as amortization expense. Research and development Research and development expenses primarily consist of personnel costs and benefits, professional services, facilities-related expenses and depreciation, fabrication services, and software costs. Most of our research and development expenses are related to developing new products and services that have not reached the point of commercialization and improving our products and services that have been commercialized. Fabrication services include certain third-party engineering costs, product testing, and test boards. Research and development expenses are expensed as incurred. We expect to continue to make substantial investments in our product and software development, clinical, and regulatory capabilities. Sales and marketing Sales and marketing expenses primarily consist of personnel costs and benefits, advertising, conferences and events, facilities-related expenses, and software costs. We expect to increase our investments in our commercial capabilities. General and administrative General and administrative expenses primarily consist of personnel costs and benefits, insurance, patent fees, software costs, facilities-related expenses, and outside services. Outside services consist of professional services, legal fees and other professional fees. Other Operating expenses classified as other are expenses which we do not consider representative of our ongoing operations. These other expenses primarily consist of employee severance and benefits costs related to reductions in force, litigation costs, loss contingencies and related loss recoveries related to ongoing litigation, and legal settlements. ### Results of Operations We operate as a single reportable segment to reflect the way our CODM reviews and assesses the performance of the business. The accounting policies are described in Note 2 "Summary of Significant Accounting Policies" in our condensed consolidated financial statements included in this Quarterly Report on Form 10-Q. | (in thousands) | Three months ended June 30, 2026 / Dollars | Three months ended June 30, 2026 / % ofrevenue | Three months ended June 30, 2025 / Dollars | Three months ended June 30, 2025 / % ofrevenue | Six months ended June 30, 2026 / Dollars | Six months ended June 30, 2026 / % ofrevenue | Six months ended June 30, 2025 / Dollars | Six months ended June 30, 2025 / % ofrevenue | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | Revenue: | | | | | | | | | | Product | $15,720 | 48.2% | $16,621 | 71.1% | $30,373 | 51.4% | $30,785 | 69.0% | | Software and other services | 16,892 | 51.8 | 6,762 | 28.9 | 28,769 | 48.6 | 13,823 | 31.0 | | Total revenue | 32,612 | 100.0 | 23,383 | 100.0 | 59,142 | 100.0 | 44,608 | 100.0 | | Cost of revenue: | | | | | | | | | | Product | 7,370 | 22.6 | 6,670 | 28.5 | 13,725 | 23.2 | 12,494 | 28.0 | | Software and other services | 1,954 | 6.0 | 1,822 | 7.8 | 3,843 | 6.5 | 3,842 | 8.6 | | Total cost of revenue | 9,324 | 28.6 | 8,492 | 36.3 | 17,568 | 29.7 | 16,336 | 36.6 | | Gross profit | 23,288 | 71.4 | 14,891 | 63.7 | 41,574 | 70.3 | 28,272 | 63.4 | | Operating expenses: | | | | | | | | | | Research and development | 10,542 | 32.3 | 8,315 | 35.6 | 20,080 | 34.0 | 18,239 | 40.9 | | Sales and marketing | 11,467 | 35.2 | 11,559 | 49.4 | 22,884 | 38.7 | 23,179 | 52.0 | | General and administrative | 11,355 | 34.8 | 9,130 | 39.0 | 22,173 | 37.5 | 18,729 | 42.0 | | Other | 3,588 | 11.0 | 1,987 | 8.5 | 3,973 | 6.7 | 2,691 | 6.0 | | Total operating expenses | 36,952 | 113.3 | 30,991 | 132.5 | 69,110 | 116.9 | 62,838 | 140.9 | | Loss from operations | (13,664) | (41.9) | (16,100) | (68.9) | (27,536) | (46.6) | (34,566) | (77.5) | | Interest income | 1,079 | 3.3 | 1,503 | 6.4 | 2,265 | 3.8 | 3,155 | 7.1 | | Interest expense | (282) | (0.9) | (368) | (1.6) | (561) | (0.9) | (715) | (1.6) | | Change in fair value of warrant liabilities | — | — | 620 | 2.7 | 413 | 0.7 | 1,446 | 3.2 | | Other income (expense), net | (43) | (0.1) | 531 | 2.3 | (168) | (0.3) | 2,906 | 6.5 | | Loss before provision for income taxes | (12,910) | (39.6) | (13,814) | (59.1) | (25,587) | (43.3) | (27,774) | (62.3) | | Provision for income taxes | — | — | 20 | 0.1 | — | — | 27 | 0.1 | | Net loss and comprehensive loss | $(12,910) | (39.6)% | $(13,834) | (59.2)% | $(25,587) | (43.3)% | $(27,801) | (62.3)% | ### Comparison of the three months ended June 30, 2026 and 2025 Revenue | (in thousands) | Three months ended June 30, 2026 | Three months ended June 30, 2025 | Change | % Change | | --- | --- | --- | --- | --- | | Product | $15,720 | $16,621 | $(901) | (5.4)% | | Software and other services | 16,892 | 6,762 | 10,130 | 149.8 | | | $32,612 | $23,383 | $9,229 | 39.5% | Product revenue decreased by $0.9 million, or 5.4%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. The overall decrease was driven by the non-recurrence of prior-year sales of semiconductor chips to our Embedded partners, reducing current-year product revenue by $1.3 million. This decrease was partially offset by $0.4 million of higher product revenue generated from the increase in probe sales volume within our core business. Software and other services revenue increased by $10.1 million, or 149.8%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. This increase was primarily driven by increases in software and other services revenue generated by our Embedded partnerships, including our co-development partnership with Midjourney, Inc. Cost of revenue | (in thousands) | Three months ended June 30, 2026 | Three months ended June 30, 2025 | Change | % Change | | --- | --- | --- | --- | --- | | Product | $7,370 | $6,670 | $700 | 10.5% | | Software and other services | 1,954 | 1,822 | 132 | 7.2 | | | $9,324 | $8,492 | $832 | 9.8% | | Percentage of revenue | 28.6% | 36.3% | | | Cost of product revenue increased by $0.7 million, or 10.5%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025, primarily driven by the increased cost of devices sold as a result of our higher probe sales volume. Cost of software and other services revenue remained relatively flat for the three months ended June 30, 2026 compared to the three months ended June 30, 2025, increasing by $0.1 million, or 7.2%. This increase was primarily driven by a $0.6 million increase in costs related to providing services to our Embedded partners, partially offset by a $0.4 million decrease in amortization expense for software development investments that we made in prior years. Research and development | (in thousands) | Three months ended June 30, 2026 | Three months ended June 30, 2025 | Change | % Change | | --- | --- | --- | --- | --- | | Research and development | $10,542 | $8,315 | $2,227 | 26.8% | | Percentage of revenue | 32.3% | 35.6% | | | Research and development expenses increased by $2.2 million, or 26.8%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. This increase was primarily driven by a $1.2 million increase in personnel costs as we invested in additional headcount for our product and software development projects, a $0.7 million increase in product engineering costs as we progressed along our product development roadmap, and a $0.3 million increase in software costs as we leveraged more third-party AI tools to optimize our employee workflows during the period. Sales and marketing | (in thousands) | Three months ended June 30, 2026 | Three months ended June 30, 2025 | Change | % Change | | --- | --- | --- | --- | --- | | Sales and marketing | $11,467 | $11,559 | $(92) | (0.8)% | | Percentage of revenue | 35.2% | 49.4% | | | Sales and marketing expenses remained relatively flat for the three months ended June 30, 2026 compared to the three months ended June 30, 2025, decreasing by $0.1 million, or 0.8%. General and administrative | (in thousands) | Three months ended June 30, 2026 | Three months ended June 30, 2025 | Change | % Change | | --- | --- | --- | --- | --- | | General and administrative | $11,355 | $9,130 | $2,225 | 24.4% | | Percentage of revenue | 34.8% | 39.0% | | | General and administrative expenses increased by $2.2 million, or 24.4%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. This increase was primarily driven by a $1.5 million increase in personnel and other employment-related costs, including stock-based compensation expenses, and the recognition of a $0.4 million provision for credit losses in the current period related to a prior sale to one international distributor. Other | (in thousands) | Three months ended June 30, 2026 | Three months ended June 30, 2025 | Change | % Change | | --- | --- | --- | --- | --- | | Other | $3,588 | $1,987 | $1,601 | 80.6% | | Percentage of revenue | 11.0% | 8.5% | | | Other increased by $1.6 million, or 80.6%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. This increase was driven by the recognition of $4.0 million of estimated liabilities for loss contingencies related to ongoing litigation and $2.0 million of higher legal costs due to litigation. These increases were partially offset by the recognition of a $4.0 million loss recovery for expected insurance recoveries related to our estimated liabilities for loss contingencies and a $0.4 million reduction in employment-related costs. We believe these costs are not representative of our ongoing operations. ### Comparison of the six months ended June 30, 2026 and 2025 Revenue | (in thousands) | Six months ended June 30, 2026 | Six months ended June 30, 2025 | Change | % Change | | --- | --- | --- | --- | --- | | Product | $30,373 | $30,785 | $(412) | (1.3)% | | Software and other services | 28,769 | 13,823 | 14,946 | 108.1 | | | $59,142 | $44,608 | $14,534 | 32.6% | Product revenue decreased by $0.4 million, or 1.3%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. The overall decrease was driven by the non-recurrence of prior-year sales of semiconductor chips to our Embedded partners, reducing current-year product revenue by $2.8 million. This decrease was partially offset by $2.4 million of higher product revenue generated from the increase in probe sales volume within our core business. Software and other services revenue increased by $14.9 million, or 108.1%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. This increase was primarily driven by increases in software and other services revenue generated by our Embedded partnerships, including our co-development partnership with Midjourney, Inc. Cost of revenue | (in thousands) | Six months ended June 30, 2026 | Six months ended June 30, 2025 | Change | % Change | | --- | --- | --- | --- | --- | | Product | $13,725 | $12,494 | $1,231 | 9.9% | | Software and other services | 3,843 | 3,842 | 1 | — | | | $17,568 | $16,336 | $1,232 | 7.5% | | Percentage of revenue | 29.7% | 36.6% | | | Cost of product revenue increased by $1.2 million, or 9.9%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025, primarily driven by the increased cost of devices sold as a result of our higher probe sales volume. Cost of software and other services revenue remained flat for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. Research and development | (in thousands) | Six months ended June 30, 2026 | Six months ended June 30, 2025 | Change | % Change | | --- | --- | --- | --- | --- | | Research and development | $20,080 | $18,239 | $1,841 | 10.1% | | Percentage of revenue | 34.0% | 40.9% | | | Research and development expenses increased by $1.8 million, or 10.1%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. This increase was primarily driven by a $0.7 million increase in product engineering costs as we progressed along our product development roadmap, a $0.4 million increase in personnel costs as we invested in additional headcount for our product and software development projects, and a $0.4 million increase in software costs as we leveraged more third-party AI tools to optimize our employee workflows during the period. Sales and marketing | (in thousands) | Six months ended June 30, 2026 | Six months ended June 30, 2025 | Change | % Change | | --- | --- | --- | --- | --- | | Sales and marketing | $22,884 | $23,179 | $(295) | (1.3)% | | Percentage of revenue | 38.7% | 52.0% | | | Sales and marketing expenses remained relatively flat for the six months ended June 30, 2026 compared to the six months ended June 30, 2025, decreasing by $0.3 million, or 1.3%, largely driven by optimization of our marketing investments while delivering higher sales volume. General and administrative | (in thousands) | Six months ended June 30, 2026 | Six months ended June 30, 2025 | Change | % Change | | --- | --- | --- | --- | --- | | General and administrative | $22,173 | $18,729 | $3,444 | 18.4% | | Percentage of revenue | 37.5% | 42.0% | | | General and administrative expenses increased by $3.4 million, or 18.4%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. This increase was primarily driven by a $2.2 million increase in personnel and other employment-related costs, including stock-based compensation expenses; a $0.4 million increase in professional service costs for consulting, accounting, and auditing services; and the recognition of a $0.4 million provision for credit losses in the current period related to a prior sale to one international distributor. Other | (in thousands) | Six months ended June 30, 2026 | Six months ended June 30, 2025 | Change | % Change | | --- | --- | --- | --- | --- | | Other | $3,973 | $2,691 | $1,282 | 47.6% | | Percentage of revenue | 6.7% | 6.0% | | | Other increased by $1.3 million, or 47.6%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. This increase was driven by the recognition of $7.3 million of estimated liabilities for loss contingencies related to ongoing litigation and $4.3 million of higher legal costs due to litigation. These increases were partially offset by the recognition of a $10.0 million loss recovery for expected insurance recoveries related to our estimated liabilities for loss contingencies and a $0.2 million reduction in employment-related costs. We believe these costs are not representative of our ongoing operations. ### Liquidity and Capital Resources Since our inception, our primary sources of liquidity are cash flows from operations and proceeds from stock issuances and the Business Combination. Our primary uses of liquidity are operating expenses, working capital requirements, and capital expenditures. During the three months ended June 30, 2026, we utilized $13.3 million of cash and cash equivalents for ongoing operations. As of June 30, 2026, our cash and cash equivalents balance was $124.7 million. Our future spending will depend on various factors, including our rate of revenue growth and the timing and extent of spending on strategic business initiatives. We expect that our existing cash and cash flows from operations will be sufficient to meet our anticipated liquidity, working capital, and capital expenditure requirements and fund our operations for at least the next 12 months. As of June 30, 2026, we have restricted cash of $4.0 million to secure a letter of credit for one of our leases, which is expected to be maintained as a security deposit for the duration of the lease. Our material cash requirements include contractual obligations with third parties for office leases, technology licensing agreements, inventory supply agreements, and outsourced services. Our fixed office lease payment obligations were $22.5 million as of June 30, 2026, with $3.8 million payable within the next 12 months. Our fixed technology license payment obligations were $10.5 million as of June 30, 2026, with $1.5 million payable within the next 12 months. Our fixed purchase obligations for inventory supply agreements, net of vendor advances, were $1.7 million as of June 30, 2026, all of which is payable within the next 12 months. Our fixed outsourced services payment obligations were $3.4 million as of June 30, 2026, with $1.4 million payable within the next 12 months. As of June 30, 2026, we had no obligations, assets or liabilities, which would be considered off-balance sheet arrangements. ### Cash flows Comparison of the six months ended June 30, 2026 and 2025 The following table summarizes our sources and uses of cash for the six months ended June 30, 2026 and 2025: | (in thousands) | Six months ended June 30, 2026 | Six months ended June 30, 2025 | | --- | --- | --- | | Net cash used in operating activities | $(30,163) | $(18,844) | | Net cash used in investing activities | (1,924) | (1,249) | | Net cash provided by financing activities | 6,257 | 79,454 | | Net increase (decrease) in cash, cash equivalents, and restricted cash | $(25,830) | $59,361 | Net cash used in operating activities Net cash used in operating activities represents the cash receipts and disbursements related to our activities other than investing and financing activities. We expect cash provided by historical financing activities will continue to be our primary source of funds to support operating and capital expenditure needs for the foreseeable future. Net cash used in operating activities increased by $11.3 million, or 60.1%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. The increase was comprised of a $14.5 million increase in net working capital cash usage, partially offset by a reduction of $3.2 million in net loss adjusted for certain non-cash items. The increase in net working capital cash usage was primarily driven by a $10.1 million increase in cash used for changes in deferred revenue, an $8.8 million increase in cash used for changes in prepaid expenses and other assets, and a $4.7 million increase in cash used for changes in accounts receivable. These increases in cash usage were partially offset by a $9.3 million decrease in cash used for changes in accounts payable and accrued expenses. Net cash used in investing activities Net cash used in investing activities increased by $0.7 million, or 54.0%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025, primarily driven by increased investment in the development of our internal-use software. Net cash provided by financing activities Net cash provided by financing activities decreased by $73.2 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. This decrease was primarily due to the $81.0 million provided by the net proceeds from our public share offering during the prior year period, partially offset by a $5.1 million increase in cash provided by exercises and purchases of our shares pursuant to our stock plans. ### Critical Accounting Policies and Significant Judgments and Estimates This discussion and analysis of our financial condition and results of operations are based on our condensed consolidated financial statements which have been prepared in accordance with U.S. GAAP. The preparation of these condensed consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, contingent assets and liabilities, and related disclosures. Our estimates are based on our historical experience and various other factors that we believe are reasonable under the circumstances, and these form the basis for making judgments about items that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. As of June 30, 2026, we concluded that revisions to our estimated liabilities for loss contingencies related to ongoing litigation and a related insurance recovery asset were appropriate. As a result, we recognized an additional $4.0 million estimated loss and a $4.0 million loss recovery in our other operating expenses during the three months ended June 30, 2026. See the "Use of Estimates" subheading in Note 2 "Summary of Significant Accounting Policies" and see Note 12 "Commitments and Contingencies" in the Notes to Condensed Consolidated Financial Statements in Part I, Item 1 "Financial Statements" of this Quarterly Report on Form 10-Q for additional information about our estimated liabilities for loss contingencies and the related insurance recovery asset. For our condensed consolidated financial statements included in this Quarterly Report on Form 10-Q, there have been no other material changes to the critical accounting policies and estimates disclosed in our 2025 Annual Report on Form 10-K. ### Recently Issued Accounting Pronouncements A description of recently issued accounting pronouncements that may potentially impact our financial position and results of operations is set forth in Note 2 "Summary of Significant Accounting Policies" in the Notes to Condensed Consolidated Financial Statements in Part I, Item 1 "Financial Statements" of this Quarterly Report on Form 10-Q. ## Item 3. Quantitative and Qualitative Disclosures About Market Risk Interest Rate Risk We did not have any floating rate debt as of June 30, 2026. Our cash and cash equivalents are comprised primarily of bank deposits and money market accounts. The primary objective of our investments is the preservation of capital to fulfill liquidity needs. We do not enter into investments for trading or speculative purposes. Due to the short-term nature and low risk profile of these investments, we do not expect cash flows to be affected to any significant degree by a sudden change in market interest rates, including an immediate change of 100 basis points, or one percentage point. Declines in interest rates, however, would reduce future investment income. Inflation Risk We do not believe that inflation has had a material effect on our business, financial condition, or results of operations, other than its impact on the general economy. Nonetheless, to the extent our costs are impacted by general inflationary pressures, including as a result of tariffs, we may not be able to fully offset such higher costs through price increases or manufacturing efficiencies. Our inability or failure to do so could harm our business, financial condition, and results of operations. Foreign Exchange Risk We operate our business primarily within the United States and currently execute the majority of our transactions in U.S. dollars. We have not utilized hedging strategies with respect to such foreign exchange exposure. This limited foreign currency translation risk is not expected to have a material impact on our condensed consolidated financial statements. ## Item 4. Controls and Procedures Evaluation of Disclosure Controls and Procedures Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act as of the end of the period covered by this Quarterly Report on Form 10-Q. Disclosure controls and procedures are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include controls and procedures designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, our principal executive officer and principal financial officer, respectively, to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation of our disclosure controls and procedures, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of June 30, 2026. Changes in Internal Control over Financial Reporting There were no changes in our internal control over financial reporting identified in connection with the evaluation required by Rules 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the three months ended June 30, 2026 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. ### PART II — OTHER INFORMATION ## Item 1. Legal Proceedings We are currently and may in the future be subject to legal proceedings, claims, and regulatory actions arising in the ordinary course of business. The outcome of any such matters, regardless of the merits, is inherently uncertain. For more information about our legal proceedings and this item, see Note 12 "Commitments and Contingencies" in the Notes to Condensed Consolidated Financial Statements in Part I, Item 1 "Financial Statements" of this Quarterly Report on Form 10-Q, which is incorporated herein by reference. ## Item 1A. Risk Factors Our business, results of operations, and financial condition are subject to various risks and uncertainties including the risk factors described under the caption "Risk Factors" in our 2025 Annual Report on Form 10-K. There have been no material changes to the risk factors described in the 2025 Annual Report on Form 10-K. ## Item 2. Unregistered Sales of Equity Securities and Use of Proceeds Unregistered Sales of Equity Securities Not applicable. Issuer Purchases of Equity Securities We did not repurchase any of our equity securities during the three months ended June 30, 2026. ## Item 5. Other Information Rule 10b5-1 Trading Arrangements During the three months ended June 30, 2026, none of our directors or officers (as defined in Rule 16a-1(f) of the Exchange Act) of the Company adopted, modified, or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement", as each term is defined in Item 408 of Regulation S-K. ## Item 6. Exhibits See Exhibit Index. EXHIBIT INDEX | Exhibit Number | Exhibit Description | Filed Herewith | Incorporated by Reference herein from Form or Schedule | Filing Date | SEC File/ Reg. Number | | --- | --- | --- | --- | --- | --- | | 3.1 | Third Amended and Restated Certificate of Incorporation, as amended, of the Registrant, as filed with the Secretary of the State of Delaware on June 7, 2024. | | Form 8-K(Exhibit 3.1) | 6/13/2024 | 001-39292 | | 3.2 | Amended and Restated Bylaws of Butterfly Network, Inc. | | Form 8-K(Exhibit 3.2) | 2/16/2021 | 001-39292 | | 10.1@ | Co-Development and Licensing Agreement, dated as of November 13, 2025, by and between BFLY Operations, Inc. and Midjourney, Inc. | X | | | | | 31.1 | Certification of the Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | X | | | | | 31.2 | Certification of the Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | X | | | | | 32.1 | Certifications of the Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | X* | | | | | 101.INS | Inline XBRL Instance Document - The instance document does not appear in the Interactive Data File because its Inline XBRL tags are embedded within the Inline XBRL document. | X | | | | | 101.SCH | Inline XBRL Taxonomy Extension Schema Document. | X | | | | | 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document. | X | | | | | 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document. | X | | | | | 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document. | X | | | | | 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document. | X | | | | | 104 | Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101) | X | | | | * Furnished herewith. @ Certain confidential portions of this Exhibit were omitted by means of marking such portions with brackets (“[***]”) because the identified confidential portions (i) are not material and (ii) would be competitively harmful if publicly disclosed. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. BUTTERFLY NETWORK, INC. Date: July 30, 2026 By: /s/ John Doherty John Doherty Executive Vice President, Chief Financial Officer --- ## EX-10.1 SEC source: [bfly-20260630xex101.htm](https://www.sec.gov/Archives/edgar/data/1804176/000180417626000027/bfly-20260630xex101.htm) Exhibit 10.1 Certain identified information has been omitted from this exhibit because it is (i) not material and (ii) of the type that the registrant treats as private or confidential. [***] indicates the information has been omitted. Execution Version CO-DEVELOPMENT AND LICENSING AGREEMENT BUTTERFLY - MIDJOURNEY This Co-Development and Licensing Agreement (“Agreement”) is made and entered into as of November 13, 2025 (“Effective Date”) by and between Midjourney, Inc., a Delaware corporation (“Midjourney”), and BFLY Operations, Inc., a Delaware corporation (“Butterfly”). Midjourney and Butterfly may each be referred to herein as a “Party” and collectively as the “Parties”. WHEREAS, Butterfly is a digital health business that makes available a handheld, whole-body ultrasound device (“Device”) and related SaaS software (“Software”), where the Device is powered by Butterfly’s proprietary Ultrasound-on-Chip technology (“Chip Technology”) and is supported by intellectual property that facilities interaction with the Chip Technology (“Backend Technology”, as enumerated in Exhibit A), and Butterfly’s chip hardware (“Chip”, and collectively, “Butterfly IP”). WHEREAS, Midjourney is an independent artificial intelligence (“AI”) research lab, and wishes to partner with Butterfly to: (i) license Butterfly IP for use in 2D and 3D tomographic imaging of 25% or more of the body mass of human subjects using ultrasound-on-chip technology in an immersive water-bath configuration (“Field of Use”); (ii) purchase Chips from Butterfly; and (iii) collaborate on the development of chip technology to be used by Midjourney in the Field of Use (“Co-Development”). WHEREAS, The Parties previously entered into a certain binding term sheet dated March 14, 2025 (“Term Sheet”), which set forth the terms and conditions for a potential co-development and licensing relationship between the Parties concerning the Chip Technology, the Parties now wish to enter into this definitive Agreement to formalize and expand upon the Term Sheet. NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, the Parties agree as follows: 1.Development Plan and Milestones. The Parties shall mutually agree upon a development plan that outlines the objectives, scope of the research and development by each Party, timelines, pricing structure, and relevant development milestones (“Development Plan”), which is attached hereto as Exhibit B. Any material changes to the Development Plan must be agreed to by the Parties in writing. Certain milestones and phases may be further detailed in a Statement of Work (“SOW”), which will describe the scope of work, deliverables, timelines, and fees applicable to that portion of the Development Plan. Each SOW executed by the Parties shall be incorporated into, and form part of, this Agreement. In the event of a conflict between the terms of this Agreement and a SOW, this Agreement shall control, except where the SOW expressly states that it overrides a provision of this Agreement. 2.Intellectual Property; License. 2.1.Background IP. As between the Parties, each Party shall own and retain all right, title, and interest in and to all inventions, patents, patent applications and disclosures, innovations, improvements, formula, materials, original works of authorship, algorithms, software, database, developments, concepts, methods, trade secrets, designs, drawings, reports, and all similar information and all intellectual property rights therein that: (a) was made, conceived, developed, reduced to practice or acquired by such Party prior to the Effective 1 Certain identified information has been omitted from this exhibit because it is (i) not material and (ii) of the type that the registrant treats as private or confidential. [***] indicates the information has been omitted. Execution Version Date; or (b) is conceived, developed, reduced to practice, or acquired by such Party independently of this Agreement (collectively, “Background IP”). 2.1.1.Butterfly Background IP shall include all expertise, know-how, technical information, methodologies, algorithms, designs, software, firmware, research data, prototypes, specifications, and any other information related to the Device, Software, Backend Technology, and Chip Technology, including any improvements, modifications, or derivatives of the foregoing that are developed independently by Butterfly and excludes any Midjourney Modifications (as defined below). 2.1.2.Midjourney Background IP shall include all expertise, know-how, technical information, methodologies, algorithms, designs, software, firmware, research data, prototypes, specifications, and any other information related to Midjourney’s proprietary AI models and related hardware and excluding any Butterfly Improvements (as defined below). 2.2.Developed IP. All intellectual property, including but not limited to inventions, discoveries, modifications, derivatives, improvements, enhancements, designs, software, firmware, trade secrets, and other works created, conceived, developed, or reduced to practice in connection with the Co-Development (collectively, “Co-Developed Technology”) shall be owned exclusively by Midjourney, but excluding all Butterfly Background IP and Butterfly Improvements. 2.2.1.Midjourney Modifications. Midjourney shall own all software, drivers, interfaces, middleware, or other enhancements, improvements, modifications, customizations, or derivatives of Butterfly IP that are: (a) to be used in connection with Midjourney’s products, technology, or Co-Developed Technology; and (b) developed by or on behalf of Midjourney, other than by Butterfly (“Midjourney Modifications”), but excluding all Butterfly Background IP and Butterfly Improvements. 2.2.1.1.Midjourney Modifications shall be used exclusively in connection with the Chip and within the Field of Use. Midjourney shall not license, sell, or otherwise provide the Midjourney Modifications to any third party except as part of a Commercial Product (as defined below). 2.2.1.2.Midjourney grants to Butterfly a royalty-free, irrevocable, perpetual, and worldwide license to use the Midjourney Modifications solely for the purpose of supporting and enabling the use of the Chip in connection with the Co-Developed Technology 2.2.2.Butterfly Improvements. Butterfly shall own all improvements, modifications, or derivatives of the Chip, the Software, or the Chip Technology that does not constitute Midjourney Background IP or Midjourney Modifications , . (“Butterfly Improvements”) . Such Butterfly Improvements shall be Chip Technology, and deemed included in the scope of the Butterfly IP License. Butterfly Improvements shall include, but not be limited to, any developed technology or IP set forth for Butterfly’s Apollo Chip or as a “Butterfly Improvement” in any SOW. 2.2.3.Cooperation. To the extent any Co-Developed Technology or Midjourney Modifications require formal documentation to perfect Midjourney’s ownership, Butterfly shall execute, and shall ensure that its employees, agents, and affiliates 2 Certain identified information has been omitted from this exhibit because it is (i) not material and (ii) of the type that the registrant treats as private or confidential. [***] indicates the information has been omitted. Execution Version execute, all such necessary documents at Midjourney’s request and expense. To the extent any Butterfly Improvements require formal documentation to perfect Butterfly’s ownership, Midjourney shall execute, and shall ensure that its employees, agents, and affiliates execute, all such necessary documents at Butterfly’s request and expense. 2.3.License of Butterfly IP. For the duration of the Term subject to the terms and conditions of this Agreement, including the payment of all applicable fees, Butterfly grants to Midjourney a non-transferable, non-sublicensable (except as otherwise set forth in this Agreement): (a) license to access and use the Chip Technology, on an exclusive basis within the Field of Use (“Chip Technology License”); (b) license to use the Software within the Field of Use (“Software License”); and (c) license to make, use, sell, copy, and create derivative works of the Backend Technology in furtherance of the Co-Development on an exclusive basis within the Field of Use and only to the extent necessary to enable the Chip Technology License (“Backend Technology License”, and collectively, “Butterfly IP License”). 2.4.License under Blocking Patents. To ensure that each Party , and any of its successors and assigns in accordance with Section 13.4, is not blocked from using its own technology, each Party hereby grants to the other Party , its affiliates, and its successors and assigns, a non-exclusive, non-transferable, perpetual and irrevocable, fully-paid, royalty free and sub-licensable (through multiple tiers) patent license for any and all patent claims where: (a) that Party owns or has a right to sublicense that claim without incurring a payment or other obligation to a third party; (b) the claim covers any invention that is or includes any Co-Developed Technology or any portion thereof; and (c) the claim would be infringed by making, using, selling, offering to sell, importing, or distributing any then-current or future product, service, or technology, or any improvement or replacement thereto of the other Party , its affiliates and its successors and assigns. 3.Fees; Payment Terms. 3.1.One-time NRE Fee. Midjourney shall pay to Butterfly a one-time fee of fifteen million dollars ($15,000,000) for establishing the [***] in accordance with Section 4 herein (“NRE Fee”). The NRE Fee shall be invoiced and payable within thirty (30) days of the Effective Date. 3.2.Butterfly IP License Fee. Midjourney shall pay Butterfly an annual license fee of ten million dollars ($10,000,000) payable in equal quarterly installments during the Term as consideration for the Butterfly IP License (“Butterfly IP License Fee”). Payment obligations shall commence as of the Effective Date. If the Effective Date occurs in 2025 or at any time other than the first day of a calendar quarter, the initial quarterly installment shall be prorated based on the number of days remaining in that quarter. Each quarterly installment (including any prorated installment) shall be payable within thirty (30) days following the end of each calendar quarter during the Term. Failure by Midjourney to pay any installment of the Annual License Fee in full within such thirty (30)-day period and not cured within thirty (30) days after written notice from Butterfly, shall result in the termination of Midjourney’s exclusivity rights under this Agreement. 3.2.1.License Upgrade Option. Midjourney may, at any time during the Term, elect to upgrade its Butterfly IP License to an upgraded license [***] (“Upgraded Annual License”). Once the election to upgrade the License is made, Midjourney must maintain the Upgraded Annual License through the remainder of the Term of the Agreement. Upon such election, Midjourney shall pay to 3 Certain identified information has been omitted from this exhibit because it is (i) not material and (ii) of the type that the registrant treats as private or confidential. [***] indicates the information has been omitted. Execution Version Butterfly the upgraded license fee of [***] per calendar year, payable in equal quarterly installments, commencing on the first full month following Midjourney’s written notice of its election to upgrade. Failure by Midjourney to pay any installment of the Upgraded Annual License Fee in full within the thirty (30)-day period following the end of each calendar quarter during the Term and not cured within thirty (30) days after written notice from Butterfly, shall result in the termination of Midjourney’s exclusivity rights and Upgraded Annual License under this Agreement. 3.2.1.1.Upgraded License Terms. Under the Upgraded License and subject to the Intellectual Property Rights and Licenses of Section 2, Midjourney shall have the right to: (i) obtain and maintain a copy of the [***] IP; (ii) access and use the [***] IP for purposes of making modifications, improvements, and derivative works of the [***] IP; and (iii) [***]. In the event of such an upgrade, Midjourney shall receive a credit against the upgraded annual license fee equal to any amounts previously paid to Butterfly for the [***] annual license fee applicable to the then-current calendar year. 3.3.Milestone-Based Payments. Butterfly shall be entitled to milestone-based payments upon the achievement of the development milestones set forth in the Development Plan (each, a “Milestone”). Upon completion of a Milestone, Butterfly shall deliver to Midjourney a written Milestone notice that includes reasonable supporting documentation or evidence demonstrating the applicable Milestone completion in accordance with the Development Plan. Within 10 business days of receipt of such notice (“Acceptance Period”), Midjourney shall provide Butterfly with either: (a) written acceptance of the completed Milestone, which shall not be unreasonably withheld; or (b) a written rejection in reasonable detail specifying the grounds for rejection. If Midjourney fails to respond within the Acceptance Period, the Milestone shall be deemed accepted by Midjourney as of the next day following the end of the Acceptance Period. Upon acceptance or deemed acceptance of a Milestone, Midjourney shall pay the corresponding Milestone payment within thirty (30) days of such acceptance. 3.3.1.Dispute Resolution. In the event Midjourney provides timely written rejection of the Milestone completion notice, the Parties shall discuss in good faith to resolve the issue. If the Parties are unable to reach resolution within thirty (30) days after Midjourney’s rejection, the matter shall be escalated to senior management of each Party for discussion and resolution before either Party may pursue remedies under this Agreement. 3.4.Revenue Share. In the event Midjourney commercializes a hardware product that uses or incorporates the Chips, as a device or as part of a scanning service (“Commercial Product”) , Butterfly shall be entitled to receive [***] of the Net Revenue derived from sales of such Commercial Products, either, as applicable, based on: (a) the sale price of each unit, or (b) the price per scan, or (c) the list price of a scan offered as part of a subscription . For purposes of this Agreement, “Net Revenue” shall mean the total aggregate revenue received by Midjourney from the sale of the Commercial Products, less any applicable taxes, refunds, and credits issued. Midjourney shall maintain complete and accurate records of all revenue relevant to the calculation of Net Revenue and shall provide Butterfly with detailed quarterly reports upon Butterfly’s request. If Butterfly reasonably disputes the accuracy of a report or calculation of Net Revenue, Butterfly shall notify 4 Certain identified information has been omitted from this exhibit because it is (i) not material and (ii) of the type that the registrant treats as private or confidential. [***] indicates the information has been omitted. Execution Version Midjourney in writing with detail of the dispute, and the Parties shall promptly confer and use good faith efforts to resolve the dispute. Any such revenue share payments will be payable monthly on the last day of the month following the previous calendar month for revenue collected in that month. Any revenue share payments that are not paid in full on or before the date such payments are due will bear interest beginning on the first day after the due date at one percent (1%) per month. 3.5.Chip Pricing. The price of all Chips purchased under this Agreement during the Term shall be Cost plus [***]. “Cost” shall mean Butterfly’s direct manufacturing costs, including materials, labor, and standard overhead, but excluding any markup or profit. Butterfly shall provide Midjourney its records related to Cost upon Midjourney’s request. If Midjourney reasonably disputes the accuracy of the records or calculation of Cost, Midjourney shall notify Butterfly in writing with detail of the dispute, and the Parties shall promptly confer and use good faith efforts to resolve the dispute. 4.[***] 5.Confidentiality. 5.1.Confidential Information. Each Party (“Receiving Party”) understands that the other Party (“Disclosing Party”) has or may disclose technical, financial, business, and other information or data relating to the Disclosing Party’s business (“Confidential Information”). Confidential Information includes, without limitation, each Party’s Background IP, the Co-Developed Technology, Midjourney Modifications, Butterfly IP, non-public information regarding features, functionality and performance of hardware, products, or services, the terms of this Agreement, and all other business, financial, and technical information which is designated as “confidential”, “proprietary” or some similar designation, or any information, whether or not labeled as such, which should reasonably be understood as confidential. Confidential Information does not include any information that the Receiving Party can document: (a) is or becomes generally available to the public through no fault of the Receiving Party; (b) was in its possession or known by it prior to receipt from the Disclosing Party; (c) was rightfully disclosed to it without restriction by a third party with the legal authority to do so; or (d) was independently developed without use of any Confidential Information of the Disclosing Party. 5.2.Obligations. Subject to Butterfly’s specific disclosure obligations and timelines as a public company, each Party will not use the other Party’s Confidential Information for any purpose except in utilization of the license rights, or as otherwise permitted herein. Each Party will not disclose the other Party’s Confidential Information to third parties or to such Party’s employees, except those employees of the Receiving Party who have a need to know and are legally bound to keep the Confidential Information confidential by obligations consistent with those of this Agreement. A Party may disclose the other Party’s Confidential Information if required by law or by any applicable regulatory authority, including but not limited to the U.S. Securities and Exchange Commission (“SEC”) and New York Stock Exchange (“NYSE”), provided that the Receiving Party gives the Disclosing Party reasonable advance notice, to the extent practicable, so as to allow the Disclosing Party an opportunity to obtain a protective order or other relief as appropriate. 6.Term and Termination. 5 Certain identified information has been omitted from this exhibit because it is (i) not material and (ii) of the type that the registrant treats as private or confidential. [***] indicates the information has been omitted. Execution Version 6.1.Term. This Agreement shall commence on the Effective Date, and, unless sooner terminated pursuant this Section 6, shall be in effect for 5 years. The Parties may mutually agree in writing to extend this Agreement for additional terms. 6.2.Termination for Cause. Either Party may terminate this Agreement upon written notice if: (a) the other Party breaches a material term or condition of the Agreement, and if the breach is capable of remedy, fails to promptly remedy that breach within thirty (30) days of written notice from the non-breaching Party; or (b) upon the other Party’s liquidation, commencement of dissolution proceedings or assignment of substantially all of its assets for the benefit of creditors, or if the other party becomes the subject of bankruptcy or similar proceeding that is not dismissed within sixty (60) days. All payments due under this Agreement, except for any amounts properly accrued for work performed prior to termination, shall immediately cease upon such termination. 6.3.Survival. Upon expiration or termination of this Agreement, all rights and obligations will immediately terminate except any sections of the Agreement that by their nature should survive such termination will survive, including but not limited to the sections titled Intellectual Property, Confidentiality, [***], Representations and Warranties, Indemnification, Limitation of Liability, and Miscellaneous. Notwithstanding the foregoing, all licenses under Section 2.3 will terminate with this Agreement. 7.Representations and Warranties. 7.1.Each Party hereby represents and warrants to the other Party that: (i) it has the full power and authority to enter into this Agreement, to carry out its obligations hereunder, and to grant the rights set forth herein; (ii) it shall perform its obligations in substantial compliance with all applicable laws, statutes, ordinances, and regulations, including those related to data privacy, health, and safety; (iii) it has, and will throughout the Term of this Agreement, cause its employees who work on the Co-Development to disclose to it inventions that are within the scope of the Co-Development and to assign to it the rights to such inventions; (iv) to its knowledge, its Background IP and the other Party’s use thereof will not infringe upon the intellectual property or other rights of a third party. 7.2.Disclaimer. EXCEPT AS SPECIFICALLY PROVIDED IN SECTION 7.1, EACH PARTY DISCLAIMS ALL WARRANTIES OF ANY KIND, EXPRESS OR IMPLIED, TO THE FULLEST EXTENT PERMITTED BY LAW, INCLUDING BUT NOT LIMITED TO THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, AND NONINFRINGEMENT. NEITHER PARTY MAKES ANY REPRESENTATION OR WARRANTY WITH REGARD TO THE SUCCESS OF THE CO-DEVELOPMENT OR THE USEFULNESS OF ANY BACKGROUND IP OR CO-DEVELOPED TECHNOLOGY. 8.Indemnification. 8.1.Mutual Indemnification. Each Party will defend, indemnify, and hold harmless the other Party and its officers, directors, employees, agents, and representatives from all judgments, damages, liabilities, costs and expenses (including reasonable attorneys’ fees) incurred in connection with any third party claim to the extent arising out of or related to: (i) a claim that the indemnifying Party has infringed or misappropriated third party intellectual property rights in its performance of this Agreement or in its Background IP; (ii) the indemnifying Party’s gross negligence or willful misconduct; or (iii) the indemnifying Party’s violation of applicable law, statute, ordinance, or regulation. 6 Certain identified information has been omitted from this exhibit because it is (i) not material and (ii) of the type that the registrant treats as private or confidential. [***] indicates the information has been omitted. Execution Version 8.2.Indemnification Procedures. The Party seeking indemnification under Section 9.1 shall promptly notify the indemnifying Party in writing of any action, claim, or liability in which such Party intends to claim such indemnification. The indemnifying Party shall have the sole and exclusive authority to defend and/or settle any such claim, provided that the indemnifying Party may not settle any claim without the indemnified Party’s written consent, which will not be unreasonably withheld, unless it unconditionally releases the indemnified Party of all related liability. The indemnified Party shall reasonably cooperate with the indemnifying Party in connection therewith. 9.Limitation of Liability. EXCEPT FOR BREACH OF CONFIDENTIALITY OBLIGATIONS UNDER SECTION 5 AND BREACH OF INTELLECTUAL PROPERTY AND LICENSING PROVISIONS OF SECTION 2 AND INDEMNIFYING PARTY’S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT (COLLECTIVELY, “EXCLUDED CLAIMS”), IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR ANY LOSS OF PROFITS OR REVENUE, LOSS OF GOODWILL OR REPUTATIONAL HARM, LOSS OF DATA, INTERRUPTION OF BUSINESS, OR ANY INDIRECT, SPECIAL, INCIDENTAL, CONSEQUENTIAL, OR PUNITIVE DAMAGES, REGARDLESS OF THE FORM OF ACTION, WHETHER IN CONTRACT, TORT, STRICT LIABILITY, OR OTHERWISE, EVEN IF INFORMED OF SUCH DAMAGES IN ADVANCE. 9.1.Damages Cap. EXCEPT FOR EXCLUDED CLAIMS, Each Party’s maximum aggregate liability for any and all claims and damages arising out of or related to this Agreement shall not exceed twenty million dollars ($20,000,000). EXCEPT FOR AN INDEMNIFYING’S PARTY GROSS NEGLIGENCE OR WILLFUL MISCONDUCT, each Party’s maximum aggregate liability for Excluded Claims shall not exceed seventy-five million dollars ($75,000,000). 10.Publicity. The Parties shall mutually agree in writing on the timing and content of any press release, public announcement, or any other public release of information that explicitly mentions the other Party and discusses the Co-Development relationship. Notwithstanding the foregoing, Butterfly, as a publicly traded company, may publicly disclose this Agreement only to the extent required by the U.S. Securities and Exchange Commission (“SEC”), New York Stock Exchange (“NYSE”) or any other applicable regulatory authority and will limit the disclosure to the minimum material terms necessary as determined by the reasonable objective judgment of its legal counsel. Butterfly will seek confidential treatment for all other information and will notify Midjourney before making any required disclosures. 11.Exclusivity. [***]. Notwithstanding the foregoing, Midjourney may perform its obligations under this Agreement independently or by engaging third parties, as long such third parties are not [***], to do so on its behalf, provided that Midjourney does not violate any confidentiality obligations or other terms and conditions of this Agreement in connection with such development and/or third party engagement. Nothing in this section will restrict Midjourney’s ordinary course of business with third parties other than [***] outside of the Field of Use. 12.Non-Solicitation. Each Party agrees, during the Term and for a period of one year after the end of the Term, not to directly or indirectly solicit or induce for employment, or employ or engage as an independent contractor, any personnel of the other Party. In addition, neither Party shall, directly or indirectly, facilitate, encourage, or assist any third party in soliciting, inducing, employing, or engaging as an independent contractor any personnel of the other Party. The restrictions of this Section 12 will not apply to individuals who independently respond to indirect solicitations (such as 7 Certain identified information has been omitted from this exhibit because it is (i) not material and (ii) of the type that the registrant treats as private or confidential. [***] indicates the information has been omitted. Execution Version general newspaper advertisements, employment agency referrals and internet postings) not targeting such individual. The restrictions in this Section 12 on a Party will immediately terminate in the event of the commencement of bankruptcy proceedings by or against the other Party under Title 11 of the United States Code (“Title 11”). 13.Miscellaneous. 13.1.Severability. If any provision of this Agreement is determined to be unenforceable or invalid for any reason, in whole or in part, such invalidity or unenforceability shall attach only to such provision or part thereof and the remaining part and all other provisions shall continue in full force and effect. 13.2.Entire Agreement. This Agreement, and any accompanying attachments constitutes the entire agreement between the Parties with respect to the subject matter of this Agreement, and supersedes all prior negotiations, agreements, representations, and understandings of any kind, whether written or oral, between the Parties, preceding the date of this Agreement. In the event of any conflict between this Agreement and the Term Sheet and any quotations, the terms of this Agreement shall govern. 13.3.Assignments. Neither Party may assign or transfer this Agreement in whole or in part, by operation of law or otherwise, without the prior written consent of the other Party, except that either Party (the “Assigning Party”) may assign or transfer this Agreement without the written consent of other Party (the “Non-Assigning Party”) to a Person succeeding to all or substantially all the assets or business of the Assigning Party to which this Agreement relates, whether by merger, purchase or otherwise, provided that such Person expressly assumes, in a writing delivered to the Non-Assigning Party, all of the terms and conditions of this Agreement. Any attempted assignment, delegation or transfer by an Assigning Party in violation hereof shall be null and void. Subject to the foregoing, this Agreement shall be binding on the Parties and their successors and assigns Notwithstanding the foregoing, Midjourney may assign this Agreement to its Affiliate without Butterfly’s consent, provided that such assignment shall only become effective upon notice being received by Butterfly, and such Affiliate assuming all of the applicable obligations of Midjourney under this Agreement. “Affiliate” shall mean any person or entity that directly or indirectly controls, is controlled by, or is under common control with Midjourney, or any direct or indirect subsidiary of Midjourney in which Midjourney holds more than fifty (50%) of the ownership interest. 13.4.Modifications. No modifications to this Agreement shall be binding upon the Parties without the express, written consent of both Parties. 13.5.Governing Law. The laws of the State of California shall govern this Agreement without giving effect to the choice of law provisions thereof. Any action based on or arising out of this Agreement shall be brought and maintained exclusively in a state or federal court located in San Francisco, California. [Signature Page Follows] 8 Certain identified information has been omitted from this exhibit because it is (i) not material and (ii) of the type that the registrant treats as private or confidential. [***] indicates the information has been omitted. Execution Version IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Effective Date. MIDJOURNEY: BUTTERFLY: /s/ David Holz /s/ Joseph DeVivo Name: David Holz Name: Joseph DeVivo Title: DH Title: CEO Date: 11/17/2025 Date: 11/13/2025 9 Certain identified information has been omitted from this exhibit because it is (i) not material and (ii) of the type that the registrant treats as private or confidential. [***] indicates the information has been omitted. Execution Version Exhibit A [***] 10 Certain identified information has been omitted from this exhibit because it is (i) not material and (ii) of the type that the registrant treats as private or confidential. [***] indicates the information has been omitted. Execution Version Exhibit B [***] 11 Certain identified information has been omitted from this exhibit because it is (i) not material and (ii) of the type that the registrant treats as private or confidential. [***] indicates the information has been omitted. Execution Version EXHIBIT B-1 [***] 12 --- ## EX-31.1 SEC source: [bfly-20260630xex311.htm](https://www.sec.gov/Archives/edgar/data/1804176/000180417626000027/bfly-20260630xex311.htm) Exhibit 31.1 CERTIFICATIONS UNDER SECTION 302 I, Joseph DeVivo, certify that: 1.I have reviewed this Quarterly Report on Form 10-Q of Butterfly Network, Inc.; 2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; 4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: (a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; (c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and (d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): (a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and (b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. Date: July 30, 2026 /s/ Joseph M. DeVivo Joseph M. DeVivo Chief Executive Officer, President, and Chairman of the Board --- ## EX-31.2 SEC source: [bfly-20260630xex312.htm](https://www.sec.gov/Archives/edgar/data/1804176/000180417626000027/bfly-20260630xex312.htm) Exhibit 31.2 CERTIFICATIONS UNDER SECTION 302 I, John Doherty, certify that: 1.I have reviewed this Quarterly Report on Form 10-Q of Butterfly Network, Inc.; 2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; 4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: (a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; (c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and (d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): (a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and (b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. Date: July 30, 2026 /s/ John Doherty John Doherty Executive Vice President, Chief Financial Officer --- ## EX-32.1 SEC source: [bfly-20260630xex321.htm](https://www.sec.gov/Archives/edgar/data/1804176/000180417626000027/bfly-20260630xex321.htm) Exhibit 32.1 CERTIFICATIONS UNDER SECTION 906 Pursuant to section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of section 1350, chapter 63 of title 18, United States Code), each of the undersigned officers of Butterfly Network, Inc., a Delaware corporation (the “Company”), does hereby certify, to such officer’s knowledge, that: The Quarterly Report for the quarter ended June 30, 2026 (the “Form 10-Q”) of the Company fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company. Dated: July 30, 2026 /s/ Joseph M. DeVivo Joseph M. DeVivo Chief Executive Officer, President, and Chairman of the Board Dated: July 30, 2026 /s/ John Doherty John Doherty Executive Vice President, Chief Financial Officer