Veracyte Announces Second Quarter 2024 Financial Results

Grew total revenue to $114.4 million, an increase of 27%

Grew testing revenue by 31%

Conference call and webcast today at 4:30 p.m. ET

SOUTH SAN FRANCISCO, Calif.--()--Veracyte, Inc. (Nasdaq: VCYT) today announced financial results for the second quarter ended June 30, 2024.

“Our exceptional second quarter results are a testament to the strength and robustness of Decipher and Afirma,” said Marc Stapley, Veracyte’s chief executive officer. “With both tests clearly gaining share in their respective markets and plenty of headroom for durable future expansion, our confidence in their long-term prospects continues to grow. Meanwhile, our positive cash generation and class-leading profitability profile are fueling a portfolio of tests that are poised to drive meaningful advances in precision medicine.”

Key Business Highlights

  • Increased second quarter total revenue by 27%, to $114.4 million, compared to the second quarter of 2023.
  • Grew total test volume to 39,023, an increase of 23% compared to the second quarter of 2023.
  • Increased second quarter net income to $5.7 million and delivered adjusted EBITDA of $24.0 million, or 21% of revenue.
  • Achieved record Decipher Prostate test volume of close to 19,900 tests, driven by recently updated NCCN* prostate cancer guidelines, in which the Decipher Prostate test received the highest-level rating among gene expression tests.
  • Delivered record Afirma test volume of approximately 15,700 and received Medicare coverage for Afirma testing of patients with thyroid nodules classified as “Bethesda V,” giving more patients annually access to the test.
  • Reinforced Veracyte’s commitment to evidence expansion with three published Decipher Prostate test studies, including a real-world, population-based analysis of Decipher data linked to the National Cancer Institute’s SEER database demonstrating the test’s clinical utility and underscoring the power of the Veracyte Diagnostics Platform.
  • Generated $26.7 million of cash during the second quarter to end the quarter with $235.9 million of cash and cash equivalents.

* National Comprehensive Cancer Network. NCCN makes no warranties of any kind whatsoever regarding their content, use or application and disclaims any responsibility for their application or use in any way.

A reconciliation of GAAP to non-GAAP financial measures has been provided in the tables included in this press release. An explanation of these measures is also included below under the heading "Note Regarding Use of Non-GAAP Financial Measures."

Second Quarter 2024 Financial Results

Total revenue for the second quarter of 2024 was $114.4 million, an increase of 27% compared to $90.3 million reported in the second quarter of 2023. Testing revenue was $107.0 million, an increase of 31% compared to $81.7 million in the second quarter of 2023, driven by the strong performance of our Decipher Prostate and Afirma tests. Product revenue was $3.9 million, a decrease of 3% compared to $4.0 million in the second quarter of 2023. Biopharmaceutical and other revenue was $3.6 million, a decrease of 22% compared to $4.6 million in the second quarter of 2023.

Total gross margin for the second quarter of 2024 was 68%, compared to 62% in the second quarter of 2023. Non-GAAP gross margin, which excludes the amortization of acquired intangible assets, stock-based compensation, other acquisition related expenses, and certain other adjustments was 71%, compared to 68% in the second quarter of 2023.

Operating expenses were $73.3 million for the second quarter of 2024. Non-GAAP operating expenses, which excludes amortization of acquired intangible assets, stock-based compensation, other acquisition related expenses, and other restructuring costs, grew 14% to $59.0 million compared to $51.7 million in the second quarter of 2023.

Net income for the second quarter of 2024 was $5.7 million, an improvement of 168% compared to the second quarter of 2023. Basic and diluted net earnings per common share was $0.07, an improvement of $0.19 compared to the second quarter of 2023. Non-GAAP diluted net earnings per common share was $0.30, an improvement of $0.18 compared to the second quarter of 2023. Net cash provided by operating activities in the first six months of 2024 was $20.6 million, an improvement of $6.1 million compared to the same period in 2023.

Adjusted EBITDA for the second quarter of 2024 was $24.0 million, an improvement of 118% compared to the second quarter of 2023, representing 21% of revenue compared to 12% of revenue respectively.

A reconciliation of GAAP to non-GAAP financial measures has been provided in the tables included in this press release. An explanation of these measures is also included below under the heading "Note Regarding Use of Non-GAAP Financial Measures."

2024 Financial Outlook

The company is raising full-year 2024 total revenue guidance to $432 million to $438 million, representing year-over-year growth of 20% to 21% and testing revenue growth of approximately 25%. This guidance range represents an increase compared to prior guidance of $402 million to $410 million. In addition, the company now expects cash, cash equivalents and short-term investments at the end of the year to be $260 million to $270 million compared to prior guidance of $236 million to $240 million.

Conference Call and Webcast Details

Veracyte will host a conference call and webcast today at 4:30 p.m. Eastern Time to discuss the company's financial results and provide a general business update. The conference call will be webcast live from the company’s website and will be available via the following link: https://edge.media-server.com/mmc/p/p5tuszv4. The webcast should be accessed 10 minutes prior to the conference call start time. A replay of the webcast will be available for one year following the conclusion of the live broadcast and will be accessible on the company’s website at https://investor.veracyte.com/events-presentations.

The conference call dial-in can be accessed by registering at the following link: https://register.vevent.com/register/BIbb7f6b70b4ce4820b6391059390d6139

About Veracyte

Veracyte (Nasdaq: VCYT) is a global diagnostics company whose vision is to transform cancer care for patients all over the world. We empower clinicians with the high-value insights they need to guide and assure patients at pivotal moments in the race to diagnose and treat cancer. Our Veracyte Diagnostics Platform delivers high-performing cancer tests that are fueled by broad genomic and clinical data, deep bioinformatic and AI capabilities, and a powerful evidence-generation engine, which ultimately drives durable reimbursement and guideline inclusion for our tests, along with new insights to support continued innovation and pipeline development. For more information, please visit www.veracyte.com or follow us on LinkedIn or X (Twitter).

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements, including, but not limited to our statements related to our plans, objectives, and expectations (financial and otherwise), including with respect to 2024 financial and operating results; and our intentions with respect to our tests and products, for use in diagnosing and treating diseases, in and outside of the United States. Forward-looking statements can be identified by words such as: “appears,” “anticipate,” “intend,” “plan,” “expect,” “believe,” “should,” “may,” “will,” “enable,” “positioned,” “offers,” “designed” and similar references to future periods. Actual results may differ materially from those projected or suggested in any forward-looking statements. These statements involve risks and uncertainties, which could cause actual results to differ materially from our predictions, and include, but are not limited to: our ability to launch, commercialize and receive reimbursement for our products; our ability to execute on our business strategies relating to the C2i Genomics acquisition, integration of the business and the realization of expected benefits and synergies; our ability to demonstrate the validity and utility of our genomic tests and biopharma and other offerings; our ability to continue executing on our business plan; our ability to continue to scale our global operations and enhance our internal control environment; the impact of the war in Ukraine and other regional conflicts on European economies and our facilities in France; the impact of foreign currency fluctuations, increasing interest rates, inflation, the U.S. election and turmoil in the global banking and finance system; the ongoing conflict in the Middle East and the performance and utility of our tests in the clinical environment. Additional factors that may impact these forward-looking statements can be found under the caption “Risk Factors” in our Annual Report on Form 10-K filed on February 29, 2024, and our Quarterly Report on Form 10-Q filed for the three months ended June 30, 2024, to be filed August 7, 2024, as well as in other documents that we may file from time to time with the Securities and Exchange Commission. Copies of these documents, when available, may be found in the Investors section of our website at investor.veracyte.com. These forward-looking statements speak only as of the date hereof and, except as required by law, we specifically disclaim any obligation to update these forward-looking statements or reasons why actual results might differ, whether as a result of new information, future events or otherwise.

Veracyte, the Veracyte logo, Decipher, C2i Genomics, and Afirma are registered trademarks of Veracyte, Inc., and its subsidiaries in the U.S. and selected countries.

Note Regarding Use of Non-GAAP Financial Measures

In addition to the financial measures prepared in accordance with generally accepted accounting principles (GAAP), this press release and the accompanying tables contain, and reference certain non‐GAAP results including non-GAAP gross margin, non-GAAP operating expenses, adjusted EBITDA and non-GAAP earnings per share (EPS). These non-GAAP financial measures are not meant to be considered superior to or a substitute for financial measures calculated in accordance with GAAP, and investors are cautioned that there are material limitations associated with the use of non-GAAP financial measures as an analytical tool.

We use non-GAAP financial measures to internally evaluate and analyze financial results. We believe these non-GAAP financial measures provide investors with useful supplemental information about the financial performance of our business, enable comparison of financial results between periods where certain items may vary independent of business performance, and enable comparison of our financial results with other public companies, many of which present similar non-GAAP financial measures. However, the non-GAAP financial measures we present may be different from those used by other companies.

We exclude amortization of acquired intangible assets, acquisition-related expenses relating to our acquisitions of Decipher Biosciences, HalioDx and C2i Genomics, impairment charges associated with the nCounter license and other biopharmaceutical services related to HalioDx intangible assets, all stock-based compensation and certain costs related to restructuring from certain of our non-GAAP financial measures. Beginning in the second quarter of 2024, we changed our non-GAAP policy to exclude all stock-based compensation to align with our peers and we have also excluded all stock-based compensation from our prior period non-GAAP financial measures. Management has excluded the effects of these items in non-GAAP financial measures to help investors gain a better understanding of the core operating results and future prospects of the company, consistent with how management measures and forecasts the company's performance, especially when comparing such results to previous periods or forecasts. The company encourages investors to carefully consider its results under GAAP, as well as its supplemental non‐GAAP information and the reconciliation between these presentations, to more fully understand its business.

VERACYTE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(In thousands, except share and per share amounts)

 

 

 

 

 

 

 

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2024

 

2023

 

2024

 

2023

Revenue:

 

 

 

 

 

 

 

Testing revenue

$

106,970

 

$

81,749

 

 

$

197,273

 

 

$

154,145

 

Product revenue

 

3,906

 

 

4,011

 

 

 

7,443

 

 

 

7,903

 

Biopharmaceutical and other revenue

 

3,552

 

 

4,562

 

 

 

6,556

 

 

 

10,696

 

Total revenue

 

114,428

 

 

90,322

 

 

 

211,272

 

 

 

172,744

 

 

 

 

 

 

 

 

 

Cost of revenue (1):

 

 

 

 

 

 

 

Cost of testing revenue

 

27,920

 

 

23,333

 

 

 

53,899

 

 

 

42,981

 

Cost of product revenue

 

1,874

 

 

2,315

 

 

 

4,518

 

 

 

4,477

 

Cost of biopharmaceutical and other revenue

 

3,812

 

 

4,040

 

 

 

6,650

 

 

 

8,459

 

Intangible asset amortization - cost of revenue

 

2,909

 

 

4,814

 

 

 

5,824

 

 

 

9,618

 

Total cost of revenue

 

36,515

 

 

34,502

 

 

 

70,891

 

 

 

65,535

 

Gross profit

 

77,913

 

 

55,820

 

 

 

140,381

 

 

 

107,209

 

Operating expenses (1):

 

 

 

 

 

 

 

Research and development

 

16,465

 

 

12,541

 

 

 

32,430

 

 

 

25,310

 

Selling and marketing

 

24,216

 

 

25,756

 

 

 

47,998

 

 

 

51,886

 

General and administrative

 

31,745

 

 

25,047

 

 

 

57,955

 

 

 

46,100

 

Impairment of long-lived assets

 

 

 

 

 

 

429

 

 

 

1,410

 

Intangible asset amortization - operating expenses

 

881

 

 

527

 

 

 

1,619

 

 

 

1,052

 

Total operating expenses

 

73,307

 

 

63,871

 

 

 

140,431

 

 

 

125,758

 

Income (loss) from operations

 

4,606

 

 

(8,051

)

 

 

(50

)

 

 

(18,549

)

Other income (loss), net

 

2,755

 

 

(226

)

 

 

5,503

 

 

 

2,181

 

Income (loss) before income taxes

 

7,361

 

 

(8,277

)

 

 

5,453

 

 

 

(16,368

)

Income tax provision

 

1,627

 

 

125

 

 

 

1,583

 

 

 

125

 

Net Income (loss)

$

5,734

 

$

(8,402

)

 

$

3,870

 

 

$

(16,493

)

Earnings (loss) per share:

 

 

 

 

 

 

 

Basic

$

0.07

 

$

(0.12

)

 

$

0.05

 

 

$

(0.23

)

Diluted

$

0.07

 

$

(0.12

)

 

$

0.05

 

 

$

(0.23

)

Shares used to compute earnings (loss) per common share:

 

 

 

 

 

 

 

Basic

 

76,538,325

 

 

72,478,662

 

 

 

75,649,057

 

 

 

72,327,897

 

Diluted

 

77,163,149

 

 

72,478,662

 

 

 

76,600,079

 

 

 

72,327,897

 

  1. Cost of revenue, research and development, sales and marketing and general and administrative expenses include the following stock-based compensation related expenses:

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2024

 

2023

 

2024

 

2023

Cost of revenue

$

604

 

$

497

 

$

1,091

 

$

884

Research and development

 

1,895

 

 

1,439

 

 

3,658

 

 

2,696

Selling and marketing

 

2,142

 

 

2,494

 

 

3,235

 

 

4,606

General and administrative

 

5,213

 

 

6,019

 

 

9,889

 

 

10,364

Total stock-based compensation expense

$

9,854

 

$

10,449

 

$

17,873

 

$

18,550

VERACYTE, INC.

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS)

(Unaudited)

(In thousands)

 

 

 

 

 

 

 

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2024

 

2023

 

2024

 

2023

Net income (loss)

$

5,734

 

 

$

(8,402

)

 

$

3,870

 

 

$

(16,493

)

Other comprehensive income (loss):

 

 

 

 

 

 

 

Change in currency translation adjustments

 

(1,703

)

 

 

(917

)

 

 

(6,592

)

 

 

3,563

 

Net comprehensive income (loss)

$

4,031

 

 

$

(9,319

)

 

$

(2,722

)

 

$

(12,930

VERACYTE, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

 

 

 

 

 

June 30,

 

December 31,

 

2024

 

2023

 

(Unaudited)

 

(See Note 1)

Assets

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

$

235,915

 

$

216,454

Accounts receivable

 

50,304

 

 

40,378

Supplies and inventory

 

19,258

 

 

16,128

Prepaid expenses and other current assets

 

15,629

 

 

12,661

Total current assets

 

321,106

 

 

285,621

Property, plant and equipment, net

 

22,291

 

 

20,584

Right-of-use assets, operating leases

 

18,116

 

 

10,277

Intangible assets, net

 

112,532

 

 

88,593

Goodwill

 

752,107

 

 

702,984

Restricted cash

 

1,088

 

 

876

Other assets

 

7,087

 

 

5,971

Total assets

$

1,234,327

 

$

1,114,906

Liabilities and Stockholders’ Equity

 

 

 

Current liabilities:

 

 

 

Accounts payable

$

12,084

 

$

12,943

Accrued liabilities

 

43,455

 

 

38,427

Current portion of deferred revenue

 

2,195

 

 

2,008

Current portion of acquisition-related contingent consideration

 

7,348

 

 

2,657

Current portion of operating lease liabilities

 

7,185

 

 

5,105

Current portion of other liabilities

 

72

 

 

101

Total current liabilities

 

72,339

 

 

61,241

Deferred tax liabilities

 

1,483

 

 

734

Acquisition-related contingent consideration, net of current portion

 

13,889

 

 

518

Operating lease liabilities, net of current portion

 

13,553

 

 

7,525

Other liabilities

 

540

 

 

786

Total liabilities

 

101,804

 

 

70,804

Total stockholders’ equity

 

1,132,523

 

 

1,044,102

Total liabilities and stockholders’ equity

$

1,234,327

 

$

1,114,906

  1. The condensed consolidated balance sheet at December 31, 2023 has been derived from the audited financial statements at that date included in the Company's Form 10-K filed with the Securities and Exchange Commission dated February 29, 2024.

VERACYTE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)

 

 

 

 

 

Six Months Ended June 30,

 

2024

 

2023

Operating activities

 

 

 

Net income (loss)

$

3,870

 

 

$

(16,493

)

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

 

 

 

Depreciation and amortization

 

11,328

 

 

 

13,529

 

Loss on disposal of property, plant and equipment

 

68

 

 

 

136

 

Stock-based compensation

 

17,873

 

 

 

18,366

 

Deferred income taxes

 

23

 

 

 

125

 

Noncash lease expense

 

2,287

 

 

 

1,977

 

Revaluation of acquisition-related contingent consideration

 

863

 

 

 

(344

)

Effect of foreign currency on operations

 

896

 

 

 

(167

)

Impairment loss

 

429

 

 

 

1,410

 

Changes in operating assets and liabilities:

 

 

 

Accounts receivable

 

(10,086

)

 

 

1,789

 

Supplies and inventory

 

(3,266

)

 

 

2,782

 

Prepaid expenses and other current assets

 

(2,183

)

 

 

(2,530

)

Other assets

 

(1,213

)

 

 

(1,048

)

Operating lease liabilities

 

(2,446

)

 

 

(2,091

)

Accounts payable

 

(1,706

)

 

 

792

 

Accrued liabilities and deferred revenue

 

3,872

 

 

 

(3,734

)

Net cash provided by operating activities

 

20,609

 

 

 

14,499

 

Investing activities

 

 

 

Acquisition of C2i, net of cash acquired

 

5,012

 

 

 

 

Purchase of short-term investments

 

 

 

 

(19,700

)

Proceeds from sale of short-term investments

 

 

 

 

39,773

 

Proceeds from maturity of short-term investments

 

 

 

 

5,000

 

Purchases of property, plant and equipment

 

(4,904

)

 

 

(4,662

)

Net cash provided by investing activities

 

108

 

 

 

20,411

 

Financing activities

 

 

 

Payment of taxes on vested restricted stock units

 

(5,135

)

 

 

(3,168

)

Proceeds from the exercise of common stock options and employee stock purchases

 

4,260

 

 

 

5,250

 

Net cash (used in) provided by financing activities

 

(875

)

 

 

2,082

 

Increase in cash, cash equivalents and restricted cash

 

19,842

 

 

 

36,992

 

Effect of foreign currency on cash, cash equivalents and restricted cash

 

(169

)

 

 

43

 

Net increase in cash, cash equivalents and restricted cash

 

19,673

 

 

 

37,035

 

Cash, cash equivalents and restricted cash at beginning of period

 

217,330

 

 

 

154,996

 

Cash, cash equivalents and restricted cash at end of period

$

237,003

 

 

$

192,031

 

CASH, CASH EQUIVALENTS AND RESTRICTED CASH

(Unaudited)

(In thousands)

 

 

 

 

 

June 30,

 

December 31,

 

2024

 

2023

Cash and cash equivalents

$

235,915

 

$

216,454

Restricted cash

 

1,088

 

 

876

Total cash, cash equivalents and restricted cash

$

237,003

 

$

217,330

VERACYTE, INC.

RECONCILIATION OF U.S. GAAP to NON-GAAP FINANCIAL MEASURES

(Unaudited)

(In thousands)

 

 

 

 

 

 

 

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2024

 

2023

 

2024

 

2023

Reconciliation of Non-GAAP Gross Margin:

 

 

 

 

 

 

 

GAAP Gross Profit

$

77,913

 

 

$

55,820

 

 

$

140,381

 

 

$

107,209

 

GAAP Gross Margin

 

68

%

 

 

62

%

 

 

66

%

 

 

62

%

Amortization of intangible assets

 

2,909

 

 

 

4,814

 

 

 

5,824

 

 

 

9,618

 

Stock-based compensation expense

 

604

 

 

 

497

 

 

 

1,091

 

 

 

884

 

Acquisition related expenses (1)

 

 

 

 

 

 

 

60

 

 

 

74

 

Other adjustments (2)

 

 

 

 

 

 

 

6

 

 

 

 

Non-GAAP Gross Profit

$

81,426

 

 

$

61,131

 

 

$

147,362

 

 

$

117,785

 

Non-GAAP Gross Margin

 

71

%

 

 

68

%

 

 

70

%

 

 

68

%

 

 

 

 

 

 

 

 

Reconciliation of Non-GAAP Operating Expenses:

 

 

 

 

 

 

 

GAAP research and development

$

16,465

 

 

$

12,541

 

 

$

32,430

 

 

$

25,310

 

Stock-based compensation expense

 

(1,895

)

 

 

(1,439

)

 

 

(3,658

)

 

 

(2,696

)

Acquisition related expenses (1)

 

23

 

 

 

 

 

 

(397

)

 

 

 

Other adjustments (2)

 

2

 

 

 

 

 

 

(276

)

 

 

 

Non-GAAP research and development

$

14,595

 

 

$

11,102

 

 

$

28,099

 

 

$

22,614

 

 

 

 

 

 

 

 

 

GAAP sales and marketing

$

24,216

 

 

$

25,756

 

 

$

47,998

 

 

$

51,886

 

Stock-based compensation expense

 

(2,142

)

 

 

(2,494

)

 

 

(3,235

)

 

 

(4,606

)

Acquisition related expenses (1)

 

 

 

 

(567

)

 

 

(124

)

 

 

(1,158

)

Other adjustments (2)

 

(194

)

 

 

 

 

 

(1,094

)

 

 

 

Non-GAAP sales and marketing

$

21,880

 

 

$

22,695

 

 

$

43,545

 

 

$

46,122

 

 

 

 

 

 

 

 

 

GAAP general and administrative

$

31,745

 

 

$

25,047

 

 

$

57,955

 

 

$

46,100

 

Stock-based compensation expense

 

(5,213

)

 

 

(6,019

)

 

 

(9,889

)

 

 

(10,364

)

Acquisition related expenses (1)

 

(1,116

)

 

 

(1,134

)

 

 

(4,585

)

 

 

(1,624

)

Other adjustments (2)

 

(2,854

)

 

 

 

 

 

(3,120

)

 

 

66

 

Non-GAAP general and administrative

$

22,562

 

 

$

17,894

 

 

$

40,361

 

 

$

34,178

 

 

 

 

 

 

 

 

 

GAAP total operating expenses

$

73,307

 

 

$

63,871

 

 

$

140,431

 

 

$

125,758

 

Amortization of intangible assets

 

(881

)

 

 

(527

)

 

 

(1,619

)

 

 

(1,052

)

Stock-based compensation expense

 

(9,250

)

 

 

(9,952

)

 

 

(16,782

)

 

 

(17,666

)

Acquisition related expenses (1)

 

(1,093

)

 

 

(1,701

)

 

 

(5,536

)

 

 

(2,782

)

Other adjustments (2)

 

(3,046

)

 

 

 

 

 

(4,490

)

 

 

(1,344

)

Non-GAAP total operating expenses

$

59,037

 

 

$

51,691

 

 

$

112,004

 

 

$

102,914

 

  1. Includes transaction-related expenses as well as post-combination compensation expenses. For the three months ended June 30, 2024, adjustments consist primarily of transaction related expenses associated with the acquisition of C2i Genomics ($1.0 million) and adjustments relating to the remeasurement of contingent consideration related to our adoption of a multi-platform IVD strategy ($0.1 million). For the three months ended June 30, 2023, adjustments consist primarily of post-combination compensation expenses associated with the acquisition of HalioDx. For the six months ended June 30, 2024, adjustments consist of transaction related expenses associated with the acquisition of C2i Genomics. For the six months ended June 30, 2023, adjustments consist primarily of post-combination compensation expenses associated with the acquisition of HalioDx.
  2. For the three months ended June 30, 2024, adjustments primarily include expense related to restructuring costs associated with a reduction in our Biopharmaceutical and Other segment ($2.9 million) and expense related to restructuring costs associated with portfolio prioritization including the reduction in Envisia commercial support ($0.2 million). For the six months ended June 30, 2024, adjustments include additional restructuring costs associated with the portfolio prioritization including the reduction in Envisia commercial support ($1.4 million). For the six months ended June 30, 2023, includes $1.3 million related to impairment charges.

VERACYTE, INC.

RECONCILIATION OF U.S. GAAP to NON-GAAP FINANCIAL MEASURES

(Unaudited)

(In thousands)

 

 

 

 

 

 

 

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2024

 

2023

 

2024

 

2023

Reconciliation of Adjusted EBITDA:

 

 

 

 

 

 

 

GAAP Net Income (Loss)

$

5,734

 

 

$

(8,402

)

 

$

3,870

 

 

$

(16,493

)

Amortization of intangible assets

 

3,790

 

 

 

5,341

 

 

 

7,443

 

 

 

10,670

 

Depreciation expense

 

1,948

 

 

 

1,518

 

 

 

3,885

 

 

 

2,859

 

Stock-based compensation expense

 

9,854

 

 

 

10,449

 

 

 

17,873

 

 

 

18,550

 

Acquisition related expenses (1)

 

1,093

 

 

 

1,701

 

 

 

5,596

 

 

 

2,856

 

Other expense (income), net (2)

 

(3,052

)

 

 

287

 

 

 

(6,313

)

 

 

(1,902

)

Other adjustments (3)

 

3,046

 

 

 

 

 

 

4,496

 

 

 

1,344

 

Income tax expense (benefit)

 

1,627

 

 

 

125

 

 

 

1,583

 

 

 

125

 

Adjusted EBITDA

$

24,040

 

 

$

11,019

 

 

$

38,433

 

 

$

18,009

 

 

 

 

 

 

 

 

 

Reconciliation of Non-GAAP Net Income (Loss)

 

 

 

 

 

 

 

GAAP Net Income (Loss)

$

5,734

 

 

$

(8,402

)

 

$

3,870

 

 

$

(16,493

)

Amortization of intangible assets

 

3,790

 

 

 

5,341

 

 

 

7,443

 

 

 

10,670

 

Stock-based compensation expense

 

9,854

 

 

 

10,449

 

 

 

17,873

 

 

 

18,550

 

Acquisition related expenses (1)

 

1,093

 

 

 

1,701

 

 

 

5,596

 

 

 

2,856

 

Other adjustments (3)

 

3,046

 

 

 

 

 

 

4,496

 

 

 

1,344

 

Tax adjustments (4)

 

(114

)

 

 

(551

)

 

 

(1,246

)

 

 

(1,127

)

Non-GAAP Net Income

$

23,403

 

 

$

8,538

 

 

$

38,032

 

 

$

15,800

 

 

 

 

 

 

 

 

 

Reconciliation of Non-GAAP Earnings per Share

 

 

 

 

 

 

 

Diluted earnings per share, GAAP

$

0.07

 

 

$

(0.12

)

 

$

0.05

 

 

$

(0.23

)

Amortization of intangible assets

 

0.05

 

 

 

0.07

 

 

 

0.10

 

 

 

0.15

 

Stock-based compensation expense

 

0.13

 

 

 

0.14

 

 

 

0.23

 

 

 

0.26

 

Acquisition related expenses (1)

 

0.01

 

 

 

0.02

 

 

 

0.07

 

 

 

0.04

 

Other adjustments (3)

 

0.04

 

 

 

 

 

 

0.06

 

 

 

0.02

 

Tax adjustments (4)

 

 

 

 

(0.01

)

 

 

(0.02

)

 

 

(0.02

)

Rounding and impact of dilutive shares

 

 

 

 

0.02

 

 

 

0.01

 

 

 

(0.01

)

Diluted earnings per share, non-GAAP

$

0.30

 

 

$

0.12

 

 

$

0.50

 

 

$

0.21

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding used in computing diluted earnings per share

 

 

 

 

 

 

 

Diluted, GAAP

 

77,163,149

 

 

 

72,478,662

 

 

 

76,600,079

 

 

 

72,327,897

 

Dilutive effect of equity awards (5)

 

 

 

 

1,221,721

 

 

 

 

 

 

1,354,135

 

Diluted, non-GAAP

 

77,163,149

 

 

 

73,700,383

 

 

 

76,600,079

 

 

 

73,682,032

 

  1. Includes transaction-related expenses as well as post-combination compensation expenses. For the three months ended June 30, 2024, adjustments consist primarily of transaction related expenses associated with the acquisition of C2i Genomics ($1.0 million) and adjustments relating to the remeasurement of contingent consideration related to our adoption of a multi-platform IVD strategy ($0.1 million). For the three months ended June 30, 2023, adjustments consist primarily of post-combination compensation expenses associated with the acquisition of HalioDx. For the six months ended June 30, 2024, adjustments consist of transaction related expenses associated with the acquisition of C2i Genomics. For the six months ended June 30, 2023, adjustments consist primarily of post-combination compensation expenses associated with the acquisition of HalioDx.
  2. Includes interest income and income related to research tax credits.
  3. For the three months ended June 30, 2024, adjustments primarily include expense related to restructuring costs associated with a reduction in our Biopharmaceutical and Other segment ($2.9 million) and expense related to restructuring costs associated with portfolio prioritization including the reduction in Envisia commercial support ($0.2 million). For the six months ended June 30, 2024, adjustments include additional restructuring costs associated with the portfolio prioritization including the reduction in Envisia commercial support ($1.4 million). For the six months ended June 30, 2023, includes $1.3 million related to impairment charges.
  4. Incremental non-GAAP tax expense reflects the tax impact of the non-GAAP adjustments listed.
  5. In those periods in which GAAP net (loss) income is negative and Non-GAAP net (loss) income is positive, Non-GAAP diluted weighted average shares outstanding includes potentially dilutive common shares from equity awards as determined using the treasury stock method.

 

Contacts

Investors:
Shayla Gorman
investors@veracyte.com
619-393-1545

Media:
Tracy Morris
media@veracyte.com
650-380-4413

Contacts

Investors:
Shayla Gorman
investors@veracyte.com
619-393-1545

Media:
Tracy Morris
media@veracyte.com
650-380-4413