DarioHealth (DRIO) Misses Q1 EPS by 2c, Revenues Miss

DarioHealth (NASDAQ: DRIO) reported Q1 EPS of ($0.15), $0.02 worse than the analyst estimate of ($0.13). Revenue for the quarter came in at $2.24 million versus the consensus estimate of $2.5 million.

CEO, Erez Raphael, stated, "Our strong financial performance in the first quarter of 2019 was driven by the increased contribution of our higher-margin, digital therapy subscriptions as a percentage of revenue, as the company's business transforms from being driven by medical devices to software-as-a-service (SaaS).

We believe there is a growing global healthcare emphasis on value and accountability enabled by user-centric evidence-based solutions. DarioHealth's pioneering digital therapeutics subscription offerings are geared towards the engaged consumer and are driving the company's improved financial performance.

We continue to see growth acceleration across our membership in user numbers, average revenue per user per month (ARPU), as well as unit margin increases in the unit economics of our membership offering.

We view these improving indicators as validation of our strategy to accommodate increasing digital personalization of healthcare through our shift from a med device-enabled, glucose monitoring app model to a comprehensive, chronic condition management subscription that helps achieve the lifestyle changes and provider access required to meaningfully improve chronic conditions and their costs.

One illustration of this is the value-based care payment initiatives launched recently by the U.S. Department of Health and Human Services (HHS)intended to transform primary care delivery and reduce national healthcare costs, 20% of which goes to the treatment of diabetes.

Our scalable digital therapy platform is built for integration by large organizations such as retailers, health insurance companies, clinics, pharmaceutical and medical device manufacturers, and nutrition companies seeking access to health and cost benefits for their users, enabled by healthcare digitization, personalization and evidence-based care.

Our plan is to meet the surge of demand for data-driven therapeutics, especially dealing with chronic conditions, and we expect to accelerate revenue and increase revenue attributed to monthly subscribers through the implementation of certain broad marketing and branding initiatives in tandem with our ongoing sales and marketing optimization efforts."

For earnings history and earnings-related data on DarioHealth (DRIO) click here.

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