iRhythm Holdings, Inc.

Thank you for attending today's iRhythm Technologies, Inc. Q2 2025 Earnings Conference Call. My name is Bethany, and I will be the moderator for today's call. All lines will be muted during the presentation portion of the call, and we do ask that you limit yourself to one question. I would now like to pass the conference over to our host, Stephanie Zabich, Senior Director of Investor Relations. Please go ahead.

Thank you all for participating in today's call. Earlier today, iRhythm released financial results for the second quarter ended June 30, 2025. Before we begin, I'd like to remind you that management will make statements during this call that include forward-looking statements within the meaning of federal securities laws pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Any statements contained in this call that are not statements of historical fact should be deemed to be forward-looking statements. These are based upon our current estimates and various assumptions and reflect management's intentions, beliefs, and expectations about future events, strategies, competition, products, operating plans, and performance. These statements involve risks and uncertainties that could cause actual results or events to materially differ from those anticipated or implied by these forward-looking statements. Accordingly, you should not place undue reliance on these statements. For a list and description of the risks and uncertainties associated with our business, please refer to the risk factors section of our most recent annual and quarterly reports on Form 10-K and Form 10-Q, respectively, filed with the Securities and Exchange Commission. Also during this call, we will discuss certain financial measures that have not been prepared in accordance with U.S. GAAP with respect to our non-GAAP and cash-based results, including adjusted EBITDA, adjusted operating expenses, and adjusted net loss. Unless otherwise noted, all references to financial metrics are presented on a non-GAAP basis. The presentation of this additional information should not be considered in isolation of as a substitute for or superior to results prepared in accordance with GAAP. Please refer to the tables on our earnings release in 10-Q for reconciliation of these measures than the most directly comparable GAAP financial measures. Unless otherwise indicated, all references to financial measures in this call, other than revenue, refer to non-GAAP results. This conference call contains time-sensitive information and is accurate only as of the live broadcast today, July 31st, 2025. IRISM disclaims any intention or obligation except as required by law, to update or revise any financial projections or forward-looking statements, whether because of new information, future events, or otherwise. And with that, I'll turn the call over to Quinton Blackford, iRhythm's President and CEO.

Thank you, Stephanie. Good afternoon, everyone, and thank you for joining us today. Dan Wilson, our Chief Financial Officer, is with me on today's call. My remarks will cover our business performance during the second quarter of 2025 and our outlook for the remainder of the year. I will then turn the call over to Dan to provide a detailed review of our financial results and updated guidance for 2025. We're excited to report strong second quarter results with $186.7 million in revenue, representing more than 26% year-over-year growth driven by acceleration within our core long-term continuous monitoring business, continued progress with innovative channel partners, and sustained strength in our ZOAT product lines. We achieved record new account openings in long-term continuous monitoring, driven by innovative channel partnerships in combination with continued strong growth from recently launched IDN customers that are adopting both Xeo Monitor and Xeo AT, leading to record revenue quarters for both product lines. We're also encouraged by the momentum we're seeing across our international markets, with continued strong demand in the United Kingdom, steady uptake in four additional European countries, and our broad commercial launch in Japan. all demonstrating the global potential of our platform and our expanding pillars of growth. As we've discussed for several quarters, iRhythm's strategic focus on moving prescribing early in the care journey to primary care physicians has not only resulted in greater capacity for cardiologists and electrophysiologists to see qualified patients, but has also enabled proactive monitoring to be offered upstream to pre-identified patients who may otherwise be asymptomatic. We've realized the benefits of this approach within our core business, where we continue to see strong, accelerating volume growth driven by expanding prescribing patterns within additional channels of our large installed base, further enabled by our EHR integration strategy and the focused execution of our commercial team. Over the past year, they've deepened engagement across existing accounts and expanded our footprint within large health systems, many of which have quickly grown into some of our most significant relationships. These results highlight our differentiated ability to deliver scalable system-wide solutions that resonate with health systems seeking streamlined, single-vendor approaches. Our Epic Aura solution, which we began offering more broadly earlier this year, is generating strong customer interest and demonstrating early operational impacts. Many early adopters are already expanding Xeo usage to new departments and care settings, leading to both volume growth and improved patient access. These integrations are also delivering significant efficiency gains, reducing project implementation times by over 50% on average. With over 40 health systems now actively implementing or preparing Aura integrations, we're excited about the continued expansion of this offering. Building on this solid foundation in our core business, we're seeing accelerating growth from innovative national account openings as we work toward addressing approximately 27 million undiagnosed patients at risk for arrhythmias in the United States alone. This represents a significant market opportunity that we're uniquely positioned to capture. During the second quarter, the contribution from innovative channel partners continued to grow as we added more than 1,000 prescribers at Signify Health, launched with another nationwide partner in Centrewell. and renewed the program with the Innovative Channel Partner from the fourth quarter of last year. What gives us confidence in this approach, albeit still in the very early stages of this market expansion, is that all of our Innovative Channel Partners have increased their activity after pilot launches and are contributing in progressively meaningful ways as we continue adding additional partner accounts. We now have 12 partners under contract covering approximately 2 million potential patients with a robust near-term pipeline of 40 active discussions and a long-term target list of approximately 100 potential partners in the U.S. market. We're optimistic this will be a meaningful contributor to our growth for years to come due to the expected repeat monitoring, new members entering the funnel, and impacting patient health statuses in the populations we serve. An essential contributor to success in these programs has been a growing body of real-world evidence describing the importance of early arrhythmia detection, especially in adjacent disease states where patients may already have or be at risk of developing arrhythmias. At the American Diabetes Association event in June of this year, retrospective real-world analysis of patients with type 2 diabetes, some of whom also had chronic kidney disease, demonstrated that cardiac arrhythmias present frequently and early, often preceding major cardiovascular events such as heart attack, stroke, or heart failure. These results build upon findings presented at American Heart Association in 2024, which demonstrated that patients with diabetes and COPD who developed arrhythmias had twice the hospitalization rate, 35 to 50% higher emergency care costs, and hospital stays up to five days longer compared to matched patients without arrhythmias, all of which drive up costs within the healthcare system. Furthermore, real-world data presented at the American College of Cardiology event in May of this year demonstrated that fewer than one in five patients experience a symptom coinciding with an arrhythmic episode, reinforcing the need to monitor patients based upon unique health factors instead of symptoms. Zio is ideally positioned to address this growing market need, as published in our Camelot data and reinforced in our Avalon data presentation at HRS this year. Xeo long-term cardiac monitoring is associated with higher diagnostic yield, lower likelihood of repeat testing, and lower likelihood of cardiovascular events compared to other long-term cardiac monitoring products. These are very important, distinctive features of our Xeo platform that allow us to find and enable the treatment of arrhythmias at lower cost. To further enable this proactive monitoring strategy for more patients, we're particularly excited to highlight our recent partnership with Lucem Health, a leader in AI-driven early disease detection solutions. This partnership represents a significant step forward in our mission to accelerate early detection of undiagnosed arrhythmias and other associated comorbid conditions. As we announced earlier today, this partnership is a first-of-its-kind offering utilizing Gluson's predictive AI to help identify arrhythmias earlier in patient populations with an elevated risk for arrhythmias. Through this comprehensive solution, we're bringing together real-world claims data, EHR integration, and predictive AI to enable physicians to identify appropriate patients for proactive monitoring using ZOECG monitoring services and deliver precision medicine solutions for population health management. This initiative positions us to empower organizations that shift from reactive care to proactive preventative care, delivering data-driven insights for review by physicians to support better outcomes and financial efficiency across populations. We believe this approach will support broader healthcare system goals to extend value beyond individual patient diagnosis to population health initiatives and value-based care strategies across specialties. By embracing proactive arrhythmia detection, leading to earlier care intervention, we can help patients and members live fuller, more meaningful lives, grounded in wellness, not crisis, while at the same time reducing the cost burdens of our existing healthcare system. With ZOAT, we delivered another record quarter, driven by sustained momentum across both new and existing accounts. Our commercial team has executed exceptionally well on two fronts. First, by expanding adoption of ZOAT within our longstanding customer base, more of which are now integrating both ZioMonitor and ZioAT into the workflows, and second, by bringing new accounts on board with full system integrations from the outset. This dual-pronged approach is enabling us to deliver more comprehensive solutions to health systems and is accelerating our growth in a market where we still hold low double-digit share compared to the more than 70% market share in our core long-term monitoring segment. The consistent growth over the past three quarters reinforces our confidence in the significant opportunity ahead. Our next-generation Xeo MCT product, for which we expect to file the 510K this quarter, is designed to significantly enhance our competitive position in this large, underpenetrated market. Key improvements we intend to submit to the FDA include moving Xeo MCT onto the same form factor as Xeo Monitor with a smaller footprint, better adhesion and extended battery life, extending wear time from 14 days to 21 days, and advanced software for enhanced detection parameters and an improved final wear report. While we're encouraged by the success of our Xeo AT service, we believe that our next generation MCT, or Xeo MCT, could be even better for our customers and their patients. Additionally, our market access and payer relations teams have made significant progress, expanding access to Xeo services as an in-network benefit to more than 10 million additional patients throughout the country. These wins have included removing MCT as an investigational benefit and recognizing the clinical value of 14-day monitoring. Turning to markets outside of the United States, we continue to make steady progress in the U.K., four additional European markets, and in Japan. In Japan, we have launched eight new commercial accounts since our second quarter commercialization with positive feedback from physicians to date. We're recruiting patients for retrospective and prospective studies to compare Zio with other cardiac monitors in Japan with the goal of demonstrating superiority of Zio over other in-country offerings. In Europe, we were pleased with another quarter of strength in the UK private market, and we've seen steady uptake in the four additional countries where we launched commercially last fall. Our teams are focused on creating market awareness through KOL engagements and on demonstrating Zio's value proposition through publications and collaborations. Looking forward, we're energized by our expanding innovation pipeline and the multiple growth vectors we're developing. Our teams are making substantial progress on next-generation capabilities, strategic partnerships, and platform enhancements that will drive both near-term performance and long-term market expansion. We're confident these investments position us to maintain our innovation leadership while capturing the significant opportunities ahead. Our strong growth trajectory is built on a foundation of operational excellence and financial discipline that positions us for sustainable scaling. We're demonstrating this commitment through our approach to regulatory excellence, submitting comprehensive responses to the FDA's warning letter and 483 observations, and implementing measures that go beyond the agency's requirements while planning a third-party audit for the second half of this year as we drive toward best-in-class quality processes. Importantly, we've expanded adjusted EBITDA margins by 500 basis points, since Q2 of last year while investing aggressively in growth initiatives, demonstrating our ability to generate sustainable operating leverage. This performance reflects our disciplined approach to process optimization, strategic automation deployment, and focused investment in financially attractive growth opportunities. With that, I'll now turn the call over to Dan to discuss our recent financial performance and updated outlook.