Original from: business wire
Guardant Health, Inc. (Nasdaq: GH), a leading precision oncology company focused on helping conquer cancer globally through use of its proprietary tests, vast data sets and advanced analytics, today reported financial results for the quarter ended September 30, 2023.
Third Quarter 2023 Financial Highlights
- Revenue of $143.0 million for the third quarter of 2023, an increase of 22% over the third quarter of 2022
- Reported 43,900 tests to clinical customers and 7,500 tests to biopharmaceutical customers in the third quarter of 2023, representing increases of 35% and 11%, respectively, over the third quarter of 2022
Recent Operating Highlights
- Presented first results of the PEGASUS MRD de-escalation trial at the European Society for Medical Oncology, ESMO, with data suggesting Guardant Reveal may help guide adjuvant treatment of colon cancer
- Received coverage for Guardant Reveal from Geisinger Health Plan
- Surpassed 200 million covered lives for TissueNext
- Launched Guardant360 for clinical use in Japan and biopharma use in China
- Received regulatory approval in Japan for Guardant360 CDx as a companion diagnostic to ENHERTU for treatment of non-small cell lung cancer patients with HER2 mutations
- Published the first paper for Shield demonstrating utility of blood-based CRC screening in Annals of Oncology
¡°We ended the third quarter with revenue growth of 22%, driven by strong year-over-year growth in clinical volume. We are starting to see the impact of coverage decisions on Guardant360, with uplifts in ASPs and additional tailwinds further strengthening the financial profile of our Therapy Selection business,¡± said Helmy Eltoukhy, co-founder and co-CEO. ¡°We recently presented exciting MRD data, further demonstrating the clinical utility of our Reveal blood test. We look forward to a strong finish to the year.¡±
¡°We are continuing to make steady progress in our screening business with our Shield blood test,¡± said AmirAli Talasaz, co-founder and co-CEO. ¡°At our recent investor day, we shared some promising new clinical validation data on the next generation of our Shield test. We are also advancing our progress in lung and other indications as we develop Shield into a multi-cancer early detection test.¡±
Third Quarter 2023 Financial Results
Revenue was $143.0 million for the three months ended September 30, 2023, a 22% increase from $117.4 million for the three months ended September 30, 2022. Precision oncology revenue grew 31%, driven predominantly by an increase in clinical testing volume and biopharma sample volume, which grew 35% and 11%, respectively, over the prior year period. In addition, our clinical testing revenue for the three months ended September 30, 2023 includes a payment of $3.6 million from Medicare related to a successful appeal for claims dated between 2018 and 2020. Development services and other revenue decreased by 37%, primarily due to the timing and amount of milestones related to our partnership agreements and companion diagnostics collaboration projects with biopharmaceutical customers, as well as a reduction in royalty revenue during the three months ended September 30, 2023.
Gross profit, or total revenue less cost of precision oncology testing and cost of development services and other, was $85.4 million for the third quarter of 2023, an increase of $8.5 million from $76.9 million for the corresponding prior year period. Gross margin, or gross profit divided by total revenue, was 60%, as compared to 66% for the corresponding prior year period. Precision oncology gross margin was 60% in the third quarter of 2023, as compared to 61% in the prior year period. The reduction is primarily due to changes in product mix. Development services and other gross margin was 59% in the third quarter of 2023, as compared to 93% in the prior year period. The change is primarily due to the inclusion of the cost of processing Shield LDT samples as part of our screening market development activities, for which we are currently booking minimal revenue.
Operating expenses were $199.0 million for the third quarter of 2023, as compared to $221.5 million for the corresponding prior year period. Non-GAAP operating expenses were $177.3 million for the third quarter of 2023, as compared to $200.5 million for the corresponding prior year period.
Net loss was $86.1 million for the third quarter of 2023, as compared to $162.0 million for the corresponding prior year period. Net loss per share was $0.73 for the third quarter of 2023, as compared to $1.58 for the corresponding prior year period. The year-over-year reduction in net loss is primarily due to a $31.1 million year-over-year improvement in our loss from operations, a $29.9 million positive change in unrealized gains and losses, and a $9.9 million increase in interest income.
Non-GAAP net loss was $79.2 million for the third quarter of 2023, as compared to $120.8 million for the corresponding prior year period. Non-GAAP net loss per share was $0.67 for the third quarter of 2023, as compared to $1.18 for the corresponding prior year period.
Adjusted EBITDA loss was $79.7 million for the third quarter of 2023, as compared to a $112.8 million loss for the corresponding prior year period.
Free cash flow for the third quarter of 2023 was negative $80.2 million. Cash, cash equivalents and marketable debt securities were $1.2 billion as of September 30, 2023.
2023 Guidance
Guardant Health now expects full year 2023 revenue to be in the range of $553 to $556 million, representing growth of 23% to 24% compared to full year 2022. Guardant Health continues to expect full year 2023 operating expenses to be below full year 2022, driven by efficiency measures and continued leverage of its existing infrastructure, and free cash flow to be approximately negative $350 million in 2023.
Source: Guardant Health Reports Third Quarter 2023 Financial Results and Increases Revenue Guidance
