Outset Medical Q1 Revenue Drops 6% to $27.9M, Gross Margin Rises to 43.4%
OM•Outset Medical’s first-quarter net revenue was $27.9 million, down 6% year-over-year, while recurring consumables and services revenue held steady at $22.5 million. Gross margin expanded over 600 basis points to 43.4%, net loss narrowed to $19 million and cash plus equivalents reached $161 million.
1. First-Quarter Revenue and Recurring Sales
Net revenue in Q1 totaled $27.9 million, a 6% decline from $29.8 million a year earlier. Product revenue fell 13% to $18.6 million while service and other revenue rose 10% to $9.3 million, with recurring Tablo consumables and services holding flat at $22.5 million.
2. Record Gross Margin Expansion
Gross margin increased by over 600 basis points to 43.4%, from 37.2% in Q1 2025, and 43.8% on a non-GAAP basis. Product margin hit 52.4% and service and other margin reached a record 26.7%, driven by efficiency improvements and cost discipline.
3. Cash Position and Profitability Progress
Net cash used was $12 million, below forecasts, leaving $161 million in cash, equivalents and short-term investments. Net loss narrowed to $19 million from $25.8 million a year ago, and non-GAAP loss improved to $15.4 million.
4. 2026 Financial Guidance
Outset Medical reiterated 2026 revenue guidance of $125 million–$130 million, a 5%–9% increase over 2025, and non-GAAP gross margin targets in the low to mid-40% range. Management emphasized focus on expanding Tablo adoption across care settings.
