Irhythm Holdings.

iRhythm pulled in $747M last year and still ran a -7.7% operating margin.

If you own IRTC, you own a heart-monitor business that still spends more than it earns.

irtc

healthcare · medical devices mid cap updated feb 6, 2026
$161.62
market cap ~$5B · 52-week range $87–$191
xvary composite: 33 / 100 · weak
our overall rating — combines growth, value, risk, and momentum
Start here if you're new
what it is
IRhythm sells wearable heart monitors and software that help doctors catch heart-rhythm problems faster.
how it gets paid
Last year Irhythm made $747M in revenue. Zio XT wearable monitoring was the main engine at $320M, or 43% of sales.
why it's growing
Revenue grew 26.2% last year on ~$747M. A quarter near ~$187M (≈¼ of FY) fits the year; $538M as “one quarter” does not.
what just happened
Latest quarter revenue near ~$187M, but EPS was still -$1.57 in this print.
At a glance
B balance sheet — gets the job done, barely
50/100 earnings predictability — expect surprises
4.0% return on capital — nothing to write home about
xvary composite: 33/100 — weak
-$0.20 fy2027 eps est
What they do
iRhythm sells wearable heart monitors and software that help doctors catch heart-rhythm problems faster.
Zio has been used on more than 2 million patients. That gives your doctor a much bigger comparison set than a small clinic can build. Data repository → giant pile of past heart traces → so what: better reads, faster diagnoses, and fewer reasons to switch.
healthcare mid-cap medical-devices digital-health cardiac-monitoring
How they make money
$747M annual revenue · their business grew +26.2% last year
Zio XT wearable monitoring
$320M
+24.0%
Zio AT ambulatory monitoring
$190M
+30.0%
ZioSuite software and analytics
$120M
+18.0%
Other services and support
$117M
+12.0%
The products that matter
cardiac monitoring services
Ambulatory Cardiac Monitoring
$747M · +26.2% growth
it is the whole business today: $747M in revenue growing 26.2% from last year, which means concentration risk is high but so is operating leverage if execution improves.
100% of revenue
wearable monitoring platform
Zio
70.4% gross margin
Zio sits inside a business that keeps 70.4% of each revenue dollar after direct costs. In human-speak: clinicians are paying for something useful, and the real fight is below gross profit.
core platform
next-gen product cycle
Next-generation Zio system
2nd 510(k) cleared response
the future upgrade path matters because the company disclosed a second 510(k) clearance response, but delayed the next submission until remediation is complete. One regulatory bottleneck can hold up a lot of optimism.
execution watch
Key numbers
$747M
annual revenue
That is the size of the company before your profit problem shows up.
70.4%
gross margin
The company keeps about 70 cents of each sales dollar before overhead, which is strong next to the -7.7% operating margin.
-7.7%
operating margin
Negative operating margin → after payroll and running costs, operations still lose money at the line shown in the feed.
$139
VL target
That target sits 14% below the current $161.62 price, so the stock already outruns one major valuation source.
Financial health
B
strength
  • balance sheet grade B — adequate — nothing special
  • risk rank 4 — safer than 20% of stocks
  • price stability 10 / 100
  • long-term debt $649M (11% of capital)
  • net profit margin 3.1% — keeps 3 cents of every dollar in revenue (feed; odd next to −7.7% operating margin—reconcile in the filing)
  • return on equity 5% — $0.05 profit for every $1 investors have put in
B — functional but not a standout on the balance sheet.
Total return vs. market

You invested $10,000 in IRTC 3 years ago → it's now worth $16,620.

The index would have given you $14,770.

same period. same starting point. IRTC beat the market by $1,850.

source: institutional data · total return
What just happened
missed estimates
Quarterly revenue near ~$187M, but EPS was still -$1.57.
Drop $538M and 179% vs. prior year—they do not reconcile to ~$747M FY. Gross margin held near 70.4%; the catch is still the bottom line.
~$187M
Q revenue (approx.)
-$1.57
eps
70.4%
gross margin
the number that mattered
The standout is still ~$747M FY growth with 70.4% gross margin while operating margin stays negative.
source: company earnings report, 2026

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What could go wrong

the #1 risk is regulatory remediation delaying the next-generation Zio platform.

∘
med
next-gen timing slips again
The company said the FDA cleared its second 510(k) response, but also delayed the next-generation Zio submission until remediation is complete.
That matters because a single-platform business with $747M in revenue does not have many places to hide if product-cycle timing slips.
∘
med
great gross margin, weak net margin
A 70.4% gross margin says the service is valuable. A 3.1% net margin and 4.0% return on capital say the value is not flowing cleanly to shareholders yet.
If cost absorption does not improve as revenue heads toward the $1B fy2029 estimate, the market starts treating this like a promise that keeps renewing itself.
∘
med
the valuation already assumes a cleaner future
The stock trades at $161.62 while the 3–5 year target midpoint sits at $139, and fy2027 EPS is still estimated at -$0.20.
That combination leaves little room for patience fatigue. If breakeven moves further right, the stock can compress even if revenue keeps rising.
This is a $747M business with high gross profit but only a 3.1% net margin. That means the downside is less about demand disappearing and more about delays, cost creep, and investors deciding they have waited long enough.
source: institutional data · regulatory filings · risk analysis
Pay attention to
margin gap
70.4% gross margin versus 3.1% net margin
That is the cleanest summary of the story. The product economics look strong. The full-company economics still need help.
growth
revenue grew 26.2% from last year
If that pace holds while margins improve, the model starts to look powerful. If growth slows before profitability shows up, the debate gets harsher.
timeline
fy2027 is still modeled below breakeven
A -$0.20 EPS estimate means investors are still paying for the future. The next few reporting cycles have to make that future feel closer, not farther away.
regulatory
watch the next-generation Zio remediation path
The second 510(k) response was cleared, but the next submission was delayed. That is the milestone with the most leverage over sentiment.
Analyst rankings
earnings predictability
50 / 100
in human-speak, analysts do not think this one is easy to model. Expect estimate revisions and a few genuine surprises.
price stability
10 / 100
This stock moves. A low stability score means the ride can be rough even when the long-term story still sounds intact.
source: institutional data
Institutional activity

institutions have been net buying for 3 consecutive quarters — 164 buyers vs. 143 sellers in 3q2025. total institutional holdings: 34.8M shares. net buying for 3 quarters.

source: institutional data · 1q2025-3q2025
source: institutional data
Price targets
3-5 year target range
$55 $222
$162 current price
$139 target midpoint · 14% from current · 3-5yr high: $222
source: institutional data · analyst targets

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