Beta Bionics Inc. (BBNX) delivered a mixed bag of results Thursday, showing impressive revenue growth but stumbling on a key metric that matters for future momentum. The diabetes management technology company beat sales expectations handily, but analysts aren't celebrating just yet.

The company reported preliminary fourth-quarter 2025 net sales of at least $32 million, crushing the consensus estimate of $28.19 million and representing year-over-year growth of at least 56%. That's solid top-line performance by any measure.

Breaking down the channels, Durable Medical Equipment (DME) sales reached at least $22.3 million, up at least 23% year-over-year. But the real star was the Pharmacy Benefit Plan (PBP) channel, which generated at least $9.7 million compared to just $2.4 million a year earlier. That's the kind of explosive growth that gets investors excited.

Beta Bionics also reported that its installed user base more than doubled to over 35,000 users from 15,298 a year ago. The company noted that approximately 69% of new users were transitioning from multiple daily insulin injections, suggesting the technology is reaching people who really need better solutions. Roughly a low-30% share of new patient starts were reimbursed through the PBP channel, up from the prior quarter, and Type 2 diabetes patients accounted for about 25% to 30% of new starts.

The Problem: Patient Starts Miss the Mark

Here's where things get tricky. New patient starts for the quarter came in at least 5,581, up 36% from 4,084 in Q4 2024. That sounds good until you realize analysts were expecting 5,816. The 4% miss might seem small, but it's a leading indicator that matters when you're trying to justify premium valuations.

Back in October during its Q3 earnings release, Beta Bionics had raised its full-year 2025 sales guidance from a range of $88 million to $93 million up to more than $96.5 million, beating the consensus of $91.36 million. The company also increased its estimate for PBP channel reimbursement to 27% to 29% of new patient starts from a prior 25% to 28%, and raised its gross margin outlook to 54% to 55% from 52% to 55%.

Bank of America Pulls Back

Bank of America downgraded Beta Bionics from Buy to Neutral on Thursday, and analyst Travis Steed didn't mince words about why. The stock is trading at roughly 6.5 times EV/2027 Sales, which puts it at the high end compared to competitors. When you're commanding premium valuations, you need premium execution, and that patient starts miss is a red flag.

Steed cut his price target from $33 to $28, noting that with just 1% to 2% total market share, the company should be showing more momentum in new patient starts. The diabetes management market is getting increasingly competitive, and Beta Bionics faces the challenge of proving it can execute against larger, more established competitors with greater scale.

The analyst acknowledged that a patch pump expected in 2027 supports the long-term investment thesis and should catalyze the stock when it arrives. But the Q4 update makes it harder to see significant upside in the near term while investors wait for that product launch.

Without profitability yet, the pressure to deliver on growth metrics becomes even more critical. You can't coast on potential forever when the competition is breathing down your neck.

BBNX Price Action: Beta Bionics shares were down 31.38% at $21.95 at the time of publication on Friday.