Achieved profitability milestone with third
quarter adjusted net income1 of $1.2M
Reported third quarter 2024 revenues2 of
$76.6M with 77% year-over-year growth of exome and genome test
revenue
Expanded third quarter 2024 adjusted gross
margins2 to 64%
Raising guidance to deliver between $284M
and $290M in FY 2024 revenue
GeneDx to host conference call today at 8:30
a.m. ET
GeneDx Holdings Corp. (Nasdaq: WGS), a leader in delivering
improved health outcomes through genomic insights, today reported
its financial results for the third quarter of 2024.
“We delivered 77% growth on exome and genome revenues in Q3 and
have reached the point of profitability, a significant milestone in
our company’s history,” said Katherine Stueland, CEO of GeneDx.
“Our advancements in genomics are redefining the standard of care,
setting new industry standards for clinical utility and economic
efficiency, and shortening the time to a diagnosis for thousands of
families. With an ever-growing number of families eligible for our
services, our growth outlook is healthy and sustainable. We
continue to bring life-changing impact to the pediatric outpatient
and NICU settings, and we are now establishing the foundation for
clinically-actionable, responsible, and scalable genomic newborn
screening.”
“Once again, our quarterly performance exceeded our top and
bottom-line expectations. The third quarter marked our 10th
consecutive quarter of cash flow improvement and we achieved
positive adjusted net income ahead of our prior target,” said Kevin
Feeley, CFO of GeneDx. “With our industry-leading technology and a
massive market opportunity ahead, GeneDx will continue to couple
financial discipline with strategic investment to accelerate the
business and provide answers for even more families in need.”
Third Quarter 2024 Financial Results (Unaudited)1,2
Revenues
- Revenues from continuing operations grew to $76.6 million, an
increase of 52% year-over-year and 11% sequentially.
- Total company revenues were $76.9 million.
- Exome and genome test revenue grew to $60.0 million, an
increase of 77% year-over-year and 18% sequentially.
Exome and genome volume
- Exome and genome test results volume grew to 19,262, an
increase of 46% year-over-year and 7% sequentially.
- Exome and genome represented 33% of all test results, up from
23% in the third quarter of 2023 and up from 31% in the second
quarter of 2024.
Gross margin
- Adjusted gross margin from continuing operations expanded to
64%, up from 48% in the third quarter of 2023 and up from 62% in
the second quarter of 2024.
- Total company gross margin was 62%.
Operating expenses
- Adjusted total operating expenses were $46.6 million, a
decrease of 2% year-over-year and an increase of 4% sequentially.
- Total GAAP operating expenses were $54.8 million.
Net Income (Loss)
- Adjusted net income improved to $1.2 million, an improvement of
106% year-over-year and 143% sequentially.
- GAAP net loss was $8.3 million.
Cash burn and cash position
- Total net use of cash was $5.0 million in the third quarter of
2024, an improvement of 88% year-over-year and 17%
sequentially.
- Cash, cash equivalents, marketable securities and restricted
cash was $117.4 million as of September 30, 2024, inclusive of
proceeds of $14.6 million, net of fees, from the issuance of
418,653 shares of Class A common stock in connection with sales
pursuant to our “at-the-market” offering during the third quarter
of 2024.
GeneDx Full Year 2024 Guidance
GeneDx has updated full year 2024 guidance. Management expects
GeneDx to:
- Drive full year 2024 revenues2 between $284 and $290 million
(previous guidance was between $255 and $265 million);
- Expand full year 2024 adjusted gross margin2 profile to at
least 62% (previous guidance was at least 60%);
- Use between $60 to $65 million of net cash for full year 2024
(previous guidance was between $65 to $70 million)
- Adjusted gross margin, adjusted total operating expenses and
adjusted net income (loss) are non-GAAP financial measures. See
appendix for a reconciliation of GAAP to Non-GAAP figures
presented.
- Revenue and gross margin results from continuing operations,
which we believe are representative of our ongoing business
strategy exclude any revenue and cost of goods sold of the exited
Legacy Sema4 diagnostic testing business for the current and all
comparative periods. Total company results are labeled accordingly
and include GeneDx’s continuing operations and the financial
impacts of exited Legacy Sema4 business activities for the current
and all comparative periods.
Third Quarter 2024 Business Highlights
Driving sustainable growth and expanding access for more patient
populations
- Achieved over 700,000 clinical exomes and genomes sequenced,
with over 100,000 completed in the last six months alone
- Accelerated adoption of whole exome sequencing (WES) and whole
genome sequencing (WGS) coverage by state Medicaid programs,
bringing total states covering exome or genome sequencing in the
pediatric outpatient setting to 30
- Indiana - WES and WGS (July 2024)
- Connecticut - WGS (July 2024)
- Texas - WGS (September 2024)
- Florida - WGS (October 2024)
- The Centers for Medicare & Medicaid Services issued
“historic guidance” to state Medicaid agencies, underscoring their
obligation to provide all medically necessary services under the
Early and Periodic Screening, Diagnostic, and Treatment (EPSDT)
benefit
- Under EPSDT, every Medicaid-enrolled child under 21 is entitled
to services that meet their unique medical needs. This includes
diagnostics like exome and genome sequencing - some of the most
powerful tools we have to unlock appropriate care, treatments, and
crucial support systems for these children.
- Expanded the Epilepsy Partnership Program, a first-of-its-kind
patient access program that is increasing access to exome and
genome sequencing for pediatric epilepsy patients, by including an
additional biopharma partner
- Collaborated with researchers from Wellcome Sanger Institute to
release data from the largest and most diverse study to date, with
data from more than 30,000 patients, on how recessive genetic
changes contribute to developmental disorders in children
- On September 23, 2024, findings from the study were published
in Nature Genetics, showcasing that most new recessive
developmental disorder diagnoses lie within known genes.
- The publication is further evidence of our commitment to the
important role of diversity in genomics and belief that serving a
more diverse patient population drives more definitive diagnoses
for patients of all backgrounds.
Demonstrating genome leadership in the neonatal inventive care
unit (NICU)
- Launched improvements to our rapid whole genome sequencing
product, including cheek swabs for more accessible sample
collection, and shortened turnaround times to as soon as five
days
- Progressed initiative to launch Epic Aura in the first half of
2025, which will seamlessly integrate GeneDx exome and genome
testing into the ordering and resulting workflows of many of the
largest health systems across the country
Leaders in genomic newborn screening (gNBS)
- Conducted more gNBS than any other lab in the United States and
successfully executed multi-site implementation strategies across
diverse patient populations, positioning GeneDx as the clear leader
set to revolutionize the standard approach to NBS
- On October 8, 2024, data was presented at the International
Conference on Newborn Sequencing (ICoNS) showcasing that GeneDx has
now provided genomic newborn screenings for more than 14,000
infants through its participation in the groundbreaking GUARDIAN
and Early Check research studies. Today, that number exceeds
15,000.
- Revealed limitations of traditional newborn screening methods
and showcased the promise of advanced genomic technology to deliver
equitable health care for all children
- On October 24, 2024, findings from the GUARDIAN study were
published in JAMA (Journal of the American Medical Association), a
leading peer-reviewed medical journal.
- GUARDIAN goes beyond the typical newborn screening panel of
about 60 conditions to now over 450-early onset genetic conditions
with established effective interventions.
- Over the initial 11-month period, 4,000 newborns were enrolled
and 3.7% of newborns had positive screenings.
- By referencing our internal database, one of the largest of its
kind enriched for rare disease, we find that the average age of
diagnosis for children with these same conditions ranges from 7-11
years.
- Of the newborns with true positive findings, 92% had a
confirmed diagnosis for a condition not included in traditional
NBS.
- The study highlights the wide acceptance of more advanced and
modernized NBS, with 72% of families approached for the study
consenting to participate.
Webcast and Conference Call Details
GeneDx will host a conference call today, October 29, 2024, at
8:30 a.m. Eastern Time. Investors interested in listening to the
conference call are required to register online. A live and
archived webcast of the event will be available on the “Events”
section of the GeneDx investor relations website at
https://ir.genedx.com/.
Forward-Looking Statements
This press release contains certain forward-looking statements
within the meaning of the federal securities laws, including
statements regarding our future performance and our market
opportunity, including our expected full year 2024 reported revenue
guidance, our expectations regarding our adjusted gross margin
profile in 2024, and our use of net cash in 2024. These
forward-looking statements generally are identified by the words
“believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,”
“strategy,” “future,” “opportunity,” “plan,” “may,” “should,”
“will,” “would,” “will be,” “will continue,” “will likely result,”
and similar expressions. Forward-looking statements are
predictions, projections and other statements about future events
that are based on current expectations and assumptions and, as a
result, are subject to risks and uncertainties. Many factors could
cause actual future events to differ materially from the
forward-looking statements in this press release, including but not
limited to: (i) our ability to implement business plans, goals and
forecasts, and identify and realize additional opportunities, (ii)
the risk of downturns and a changing regulatory landscape in the
highly competitive healthcare industry, (iii) the size and growth
of the market in which we operate, (iv) our ability to pursue our
new strategic direction, and (v) our ability to enhance our
artificial intelligence tools that we use in our clinical
interpretation platform. The foregoing list of factors is not
exhaustive. You should carefully consider the foregoing factors and
the other risks and uncertainties described in the “Risk Factors”
section of our Annual Report on Form 10-K for the fiscal year ended
December 31, 2023, filed with the U.S. Securities and Exchange
Commission (the “SEC”) on February 23, 2024 and other documents
filed by us from time to time with the SEC. These filings identify
and address other important risks and uncertainties that could
cause actual events and results to differ materially from those
contained in the forward-looking statements. Forward-looking
statements speak only as of the date they are made. Readers are
cautioned not to put undue reliance on forward-looking statements,
and we assume no obligation and do not intend to update or revise
these forward-looking statements, whether as a result of new
information, future events, or otherwise. We do not give any
assurance that we will achieve our expectations.
About GeneDx
At GeneDx (Nasdaq: WGS), we believe that everyone deserves
personalized, targeted medical care—and that it all begins with a
genetic diagnosis. Fueled by one of the world’s largest rare
disease data sets, our industry-leading exome and genome tests
translate complex genomic data into clinical answers that unlock
personalized health plans, accelerate drug discovery, and improve
health system efficiencies. It all starts with a single test. For
more information, please visit genedx.com and connect with us on
LinkedIn, X, Facebook, and Instagram.
Volume and revenue in the table below include the combination of
the Legacy GeneDx diagnostic business with the data and information
business of Legacy Sema4.
Volume & Revenue
3Q24
2Q24
1Q24
4Q23
3Q23
Volumes
Whole exome, whole genome
19,262
18,017
16,592
15,663
13,216
Hereditary cancer
4,672
5,482
6,868
8,240
8,556
Other panels
35,095
34,204
31,763
33,692
35,861
Total
59,029
57,703
55,223
57,595
57,633
Revenue ($ millions)
Whole exome, whole genome
$
60.0
$
50.7
$
44.0
$
39.2
$
34.0
Hereditary cancer
3.3
3.8
5.5
5.5
4.5
Other panels
13.8
13.3
10.7
11.2
10.6
Data information
(0.5
)
1.1
1.3
2.2
1.3
Total
$
76.6
$
68.9
$
61.5
$
58.1
$
50.4
Unaudited Select Financial Information (in thousands)
Three months ended September
30, 2024
Three months ended June 30,
2024
GeneDx
Legacy Sema4
Total
GeneDx
Legacy Sema4
Total
Revenue
$76,622
$252
$76,874
$68,924
$1,590
$70,514
Adjusted cost of services
27,370
—
27,370
26,523
145
26,668
Adjusted gross profit
$49,252
$252
$49,504
$42,401
$1,445
$43,846
Adjusted gross margin %
64.3%
100.0%
64.4%
61.5%
90.9%
62.2%
Three months ended September
30, 2023
GeneDx
Legacy Sema4
Total
Revenue
$50,350
$2,953
$53,303
Adjusted cost of services
26,079
225
26,304
Adjusted gross profit
$24,271
$2,728
$26,999
Adjusted gross margin %
48.2%
92.4%
50.7%
Three months ended September
30, 2024
Reported
Depreciation and
amortization
Stock-based compensation
expense
Restructuring costs
Change in FV of financial
liabilities
Charges related to business
exit
Other
Adjusted
Diagnostic test revenue
$
77,418
$
—
$
—
$
—
$
—
$
—
$
—
$
77,418
Other revenue
(544
)
—
—
—
—
—
—
(544
)
Total revenue
76,874
—
—
—
—
—
—
76,874
Cost of services
29,045
(1,495
)
(174
)
(6
)
—
—
—
27,370
Gross profit
47,829
1,495
174
6
—
—
—
49,504
Gross margin
62.2
%
64.4
%
Research and development
11,665
(222
)
(537
)
—
—
—
—
10,906
Selling and marketing
17,025
(1,225
)
(394
)
(55
)
—
—
—
15,351
General and administrative
26,145
(2,987
)
(2,531
)
(308
)
—
—
—
20,319
Impairment loss
—
—
—
—
—
—
—
—
Other, net
774
—
—
—
—
—
—
774
Loss from operations
(7,780
)
5,929
3,636
369
—
—
—
2,154
Interest income (expense), net
(843
)
—
—
—
—
—
—
(843
)
Other income (expense), net
264
—
—
—
880
—
(1,327
)
(183
)
Income tax benefit
47
—
—
—
—
—
—
47
Net income (loss)
$
(8,312
)
$
5,929
$
3,636
$
369
$
880
$
—
$
(1,327
)
$
1,175
Three months ended September
30, 2023
Reported
Depreciation and
amortization
Stock-based compensation
expense
Restructuring costs
Change in FV of financial
liabilities
Charges related to business
exit
Other
Adjusted
Diagnostic test revenue
$
51,955
$
—
$
—
$
—
$
—
$
—
$
—
$
51,955
Other revenue
1,348
—
—
—
—
—
—
1,348
Total revenue
53,303
—
—
—
—
—
—
53,303
Cost of services
28,044
(1,613
)
(75
)
(52
)
—
—
—
26,304
Gross profit
25,259
1,613
75
52
—
—
—
26,999
Gross margin
47.4
%
50.7
%
Research and development
14,288
(283
)
533
(970
)
—
—
—
13,568
Selling and marketing
16,763
(1,225
)
115
(415
)
—
—
—
15,238
General and administrative
26,099
(5,551
)
(1,004
)
(754
)
—
—
—
18,790
Impairment loss
8,282
—
—
—
—
(8,282
)
—
—
Other, net
2,794
—
—
—
—
(1,014
)
—
1,780
Loss from operations
(42,967
)
8,672
431
2,191
—
9,296
—
(22,377
)
Interest income (expense), net
1,053
—
—
—
—
—
—
1,053
Other income (expense), net
(544
)
—
—
—
(590
)
—
1,134
—
Income tax benefit
172
—
—
—
—
—
—
172
Net loss
$
(42,286
)
$
8,672
$
431
$
2,191
$
(590
)
$
9,296
$
1,134
$
(21,152
)
Three months ended June 30,
2024
Reported
Depreciation and
amortization
Stock-based compensation
expense
Restructuring costs
Change in FV of financial
liabilities
Charges related to business
exit
Other
Adjusted
Diagnostic test revenue
$
69,439
$
—
$
—
$
—
$
—
$
—
$
—
$
69,439
Other revenue
1,075
—
—
—
—
—
—
1,075
Total revenue
70,514
—
—
—
—
—
—
70,514
Cost of services
27,562
(808
)
(86
)
—
—
—
—
26,668
Gross profit
42,952
808
86
—
—
—
—
43,846
Gross margin
60.9
%
62.2
%
Research and development
10,902
(211
)
(347
)
(35
)
—
—
—
10,309
Selling and marketing
16,585
(1,225
)
(368
)
(63
)
—
—
—
14,929
General and administrative
25,170
(2,974
)
(2,307
)
(150
)
—
—
—
19,739
Impairment loss
—
—
—
—
—
—
—
—
Other, net
874
—
—
—
—
—
—
874
Loss from operations
(10,579
)
5,218
3,108
248
—
—
—
(2,005
)
Interest income (expense), net
(894
)
—
—
—
—
—
—
(894
)
Other income (expense), net
(17,890
)
—
—
—
4,409
—
13,450
(31
)
Income tax benefit
190
—
—
—
—
—
—
190
Net loss
$
(29,173
)
$
5,218
$
3,108
$
248
$
4,409
$
—
$
13,450
$
(2,740
)
GeneDx Holdings Corp.
Condensed Consolidated Balance Sheets (in thousands,
except share and per share amounts)
September 30, 2024
(Unaudited)
December 31, 2023
Assets:
Current assets:
Cash and cash equivalents
$
57,894
$
99,681
Marketable securities
58,566
30,467
Accounts receivable
38,220
32,371
Due from related parties
260
445
Inventory, net
10,770
8,777
Prepaid expenses and other current
assets
20,300
10,598
Total current assets
186,010
182,339
Operating lease right-of-use assets
24,936
26,900
Property and equipment, net
31,452
32,479
Intangible assets, net
162,106
172,625
Other assets (1)
4,336
4,413
Total assets
$
408,840
$
418,756
Liabilities and Stockholders’
Equity:
Current liabilities:
Accounts payable and accrued expenses
$
56,416
$
37,456
Due to related parties
727
1,379
Short-term lease liabilities
3,698
3,647
Other current liabilities
16,501
16,336
Total current liabilities
77,342
58,818
Long-term debt, net of current portion
52,034
52,688
Long-term lease liabilities
60,369
62,938
Other liabilities
13,540
14,735
Deferred taxes
1,054
1,560
Total liabilities
204,339
190,739
Stockholders’ Equity:
Preferred stock
—
—
Class A common stock
2
2
Additional paid-in capital
1,561,493
1,527,778
Accumulated deficit
(1,357,912
)
(1,300,188
)
Accumulated other comprehensive income
918
425
Total stockholders’ equity
204,501
228,017
Total liabilities and stockholders’
equity
$
408,840
$
418,756
(1) Other assets includes $987 thousand of
restricted cash as of both September 30, 2024 and December 31,
2023.
GeneDx Holdings Corp.
Condensed Consolidated Statements of Operations (Unaudited)
(in thousands, except share and per share amounts)
Three months ended September
30,
Nine months ended September
30,
2024
2023
2024
2023
Revenue
Diagnostic test revenue
$
77,418
$
51,955
$
207,961
$
140,440
Other revenue
(544
)
1,348
1,849
4,708
Total revenue
76,874
53,303
209,810
145,148
Cost of services
29,045
28,044
81,618
85,896
Gross profit
47,829
25,259
128,192
59,252
Research and development
11,665
14,288
34,134
46,018
Selling and marketing
17,025
16,763
49,695
45,397
General and administrative
26,145
26,099
73,760
107,129
Impairment loss
—
8,282
—
10,402
Other operating expenses, net
774
2,794
2,622
5,259
Loss from operations
(7,780
)
(42,967
)
(32,019
)
(154,953
)
Non-operating income (expenses), net
Change in fair value of warrants and
earn-out contingent liabilities
(880
)
590
(11,390
)
684
Interest (expense) income, net
(843
)
1,053
(2,334
)
2,092
Other income (expense), net
1,144
(1,134
)
(12,300
)
1,668
Total non-operating income (expense),
net
(579
)
509
(26,024
)
4,444
Loss before income taxes
(8,359
)
(42,458
)
$
(58,043
)
$
(150,509
)
Income tax benefit
47
172
319
515
Net loss
$
(8,312
)
$
(42,286
)
$
(57,724
)
$
(149,994
)
Weighted average shares outstanding of
Class A common stock
27,095,986
25,788,747
26,593,877
23,777,327
Basic and diluted net loss per share,
Class A common stock
$
(0.31
)
$
(1.64
)
$
(2.17
)
$
(6.31
)
GeneDx Holdings Corp.
Condensed Consolidated Statements of Cash Flows (Unaudited)
(in thousands)
Nine months ended September
30,
2024
2023
Operating activities
Net loss
$
(57,724
)
$
(149,994
)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization expense
16,395
27,640
Stock-based compensation expense
6,293
586
Change in fair value of warrants and
contingent liabilities
11,390
(684
)
Deferred tax benefit
(319
)
(515
)
Provision for excess and obsolete
inventory
137
3,634
Legal reserves
12,123
—
Change in third party payor reserves
737
(6,848
)
Gain on sale of assets
—
(2,954
)
Gain on debt forgiveness
—
(2,750
)
Impairment loss
—
10,402
Other
2,639
1,071
Change in operating assets and
liabilities:
Accounts receivable
(5,850
)
10,726
Inventory
(2,131
)
682
Accounts payable and accrued expenses
(7,807
)
(39,913
)
Other assets and liabilities
(1,196
)
(1,372
)
Net cash used in operating activities
(25,313
)
(150,289
)
Investing activities
Consideration on escrow paid for Legacy
GeneDx acquisition
—
(12,144
)
Purchases of property and equipment
(2,441
)
(2,874
)
Proceeds from sales of assets
—
3,887
Purchases of marketable securities
(52,725
)
(43,935
)
Proceeds from sales of marketable
securities
598
—
Proceeds from maturities of marketable
securities
24,955
16,665
Development of internal-use software
assets
—
(461
)
Net cash used in investing activities
(29,613
)
(38,862
)
Financing activities
Proceeds from offerings, net of issuance
costs
14,589
143,002
Exercise of stock options
247
266
Long-term debt principal payments
(198
)
(2,000
)
Finance lease payoff and principal
payments
(1,499
)
(2,133
)
Net cash provided by financing
activities
13,139
139,135
Net decrease in cash, cash equivalents and
restricted cash
(41,787
)
(50,016
)
Cash, cash equivalents and restricted
cash, at beginning of period
100,668
138,303
Cash, cash equivalents and restricted
cash, at end of period (1)
$
58,881
$
88,287
Supplemental disclosures of cash flow
information
Cash paid for interest
$
6,068
$
1,116
Cash paid for taxes
$
910
$
1,178
Stock consideration paid for purchase of
business
$
—
$
6,692
Stock consideration paid pursuant to
exercise of Perceptive warrant
$
12,586
$
—
Purchases of property and equipment in
accounts payable and accrued expenses
$
2,612
$
1,220
Assets acquired under capital leases
obligations
$
689
$
—
(1) Cash, cash equivalents and restricted
cash at September 30, 2024 excludes marketable securities of $58.6
million.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241029161441/en/
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