NEW YORK – DarioHealth Corp. (NASDAQ:DRIO), a digital health company, has announced the addition of four new contracts with self-insured employers, set to activate in the first quarter of 2025. These agreements are part of the company's Business-to-Business-to-Consumer (B2B2C) channel expansion, aiming to provide recurring revenue streams from the comprehensive suite of Dario's digital health solutions.
The contracts cover the full range of Dario's platform services, indicating the value employers see in a multi-condition offering. The company's Chief Commercial Officer, Steven Nelson, stated that these contracts are expected to contribute to near-term growth, improve gross margins, and expand the user base. Nelson also mentioned that these signings are in line with DarioHealth's goal of achieving an estimated 25 new client signings in 2024, marking a 35% increase in the client base compared to 2023.
DarioHealth's platform delivers personalized health management tools and one-on-one coaching for various chronic conditions, including diabetes, hypertension, weight management, musculoskeletal pain, and behavioral health. The company emphasizes user-centric care that encourages sustainable behavior change and has reported high user satisfaction and retention rates.
While the company's press release contains forward-looking statements regarding the expected impact of these contracts on the company's growth and profitability, it is important to note that these are projections and actual results could differ. The company has cautioned that factors like regulatory approvals, product demand, market acceptance, and competitive pressures could affect outcomes.
The information in this article is based on a press release statement from DarioHealth Corp. and does not constitute an endorsement of the company or its products.
In other recent news, DarioHealth Corp. reported a significant increase in revenue and operational advancements during its Q3 2024 earnings call. The digital health solutions leader announced a revenue of $7.42 million, marking an 18.7% increase from the previous quarter and a 111% increase year-over-year, primarily attributed to its B2B2C business segment. The company's platform now supports six chronic conditions, thanks to the successful integration of recent acquisition, Twill.
DarioHealth also managed to reduce non-GAAP operating expenses to $12.3 million, a 15.9% decrease from the previous quarter. The company secured 10 new clients in Q3 and expects to reach 25 new clients by year-end. A strategic partnership with Centene (NYSE:CNC) has been formed to expand in the Medicare Advantage market.
Looking ahead, DarioHealth is aiming for a $50 million run rate by the end of 2025, with a focus on deepening client relationships and enhancing offerings. The company expects B2B2C revenue to grow by 50-70%, while B2C revenue stabilizes around $8 million. The company is still working towards achieving a cash flow breakeven, with the target set for the end of 2025.
InvestingPro Insights
As DarioHealth Corp. (NASDAQ:DRIO) announces new contracts with self-insured employers, it's crucial to examine the company's financial health and market performance. According to InvestingPro data, DarioHealth's market capitalization stands at $24.43 million, reflecting its current market valuation.
The company's revenue for the last twelve months as of Q3 2023 was $23.05 million, with a notable quarterly revenue growth of 111.0% in Q3 2023. This significant growth aligns with the company's expansion efforts in the B2B2C channel as mentioned in the article. However, it's important to note that the company is currently not profitable, with an operating income margin of -260.99% for the same period.
InvestingPro Tips highlight some challenges facing DarioHealth. The company is "quickly burning through cash" and "may have trouble making interest payments on debt." These factors could potentially impact the company's ability to fully capitalize on its new contracts and achieve its growth targets.
The stock's performance has been volatile, with a 19.41% decline in the past month and a 56.91% drop over the last six months. This volatility, combined with the fact that analysts do not anticipate profitability this year, suggests that investors should closely monitor the company's progress in converting these new contracts into sustainable revenue streams.
For readers interested in a deeper analysis, InvestingPro offers 8 additional tips for DarioHealth, providing a more comprehensive view of the company's prospects and challenges.
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