Q1 2025 Financial Highlights - Total revenue reached $84.7 million, an 18% increase year-over-year[13] - Testing Services volume grew to approximately 47,100 tests, a 12% increase year-over-year[18] - The company achieved a non-GAAP gross margin of 68.5%, a 150 basis points improvement year-over-year[39] - Adjusted EBITDA was positive at $4.6 million, a $6.4 million improvement year-over-year[14] - The company holds a strong cash balance of approximately $231 million, with no debt[15] Commercial Coverage and Clinical Evidence - Expanded AlloMap® Heart coverage by 3.5 million commercial lives and added 15.5 million new commercial covered lives for AlloSure[11] - Submitted the second manuscript of the SHORE (Surveillance HeartCare Outcomes Registry) study for publication[12] 2025 Guidance - Reaffirmed full-year revenue guidance of $365 million – $375 million[16] - The company estimates ASP to be approximately $1,360 per test on a blended basis[59]

Financial Data and Key Metrics Changes - The company reported quarterly revenue of $84.7 million, an increase of 18% year over year, with adjusted EBITDA of $4.6 million, compared to an adjusted EBITDA loss of $1.9 million in Q1 2024 [9][31][35] - The cash balance at the end of the quarter was $231 million, with no debt, reflecting a $15 million increase from $216 million at the end of Q1 2024 [9][35] - Non-GAAP gross margin improved to 68.5%, up 150 basis points year over year, driven by ASP expansion [30][31] Business Line Data and Key Metrics Changes - Testing services revenue was $61.9 million, up 15% year over year, with approximately 47,100 tests delivered, a 12% increase from the prior year [9][29] - Patient and Digital Solutions revenue reached $12 million, representing a 24% year over year growth, while products revenue was $10.8 million, up 26% year over year [26][30] - Adjusted testing services revenue was $63 million, up 26% year over year on a comparable basis, excluding $1.1 million in write-offs for aged receivables [30] Market Data and Key Metrics Changes - The company added 3.5 million new covered lives for AlloMap Heart and 15.5 million new covered lives for AlloSure testing in the first quarter [12] - The launch of two expanded indications for AlloSure testing is expected to enhance market penetration, particularly in pediatric heart transplant patients and simultaneous pancreas-kidney transplant patients [10][11] Company Strategy and Development Direction - The company is focused on expanding its testing services and market access strategies, with a long-range plan to achieve $500 million in revenue and 20% adjusted EBITDA by 2027 [9] - A significant initiative to integrate Epic Aura aims to streamline the ordering process for healthcare providers, enhancing operational efficiency [25][26] - The company is investing in sales and marketing to accelerate growth, with a disciplined approach to managing G&A and legal expenses [33] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the gradual return of surveillance testing volumes, particularly in kidney testing, and expects continued growth in Q2 [44][50] - The company anticipates a significant uptick in transplant procedures in the second half of the year, driven by the initiation of the IOTA program [78] - Management reiterated guidance for 2025 revenue of $365 million to $375 million, with expectations of mid-teens growth in testing volumes [36][37] Other Important Information - The company reached an agreement to resolve a securities class action litigation for $20.25 million, with expected coverage of approximately $14.9 million from D&O insurers [34] - The company is enhancing its revenue cycle management processes to improve billing and collections, which is expected to drive ASP increases over the next six to eight quarters [66] Q&A Session Summary Question: Signs of volume returning for surveillance testing - Management confirmed that they are seeing signs of volume returning, particularly in kidney testing, and progress has been made on surveillance testing protocols [44] Question: Higher than expected R&D and SG&A expenses - Management noted that the increase in operating expenses was primarily driven by investments in sales and marketing, with a focus on maintaining a tight control on overall expenses [45] Question: Additional color on surveillance volumes and protocols - Management emphasized that while they are making progress, they expect to see growth in Q2, with centers responding positively to the reinitiation of surveillance [50] Question: Impact of new LCDs for transplant testing - Management believes that the growing body of evidence supporting surveillance testing will solidify their position for coverage, although no specific timing for new LCDs was provided [51] Question: Feedback on Epic integration - Management indicated that the integration is ahead of schedule, with a full launch expected by the end of Q2, which is anticipated to reduce friction for healthcare providers [54][60] Question: Incremental benefit from transplant pharmacy on testing services revenue - Management highlighted that the synergy between patient solutions and testing services is strong, leading to greater access and engagement with customers [82]

[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Unaudited Condensed Consolidated Financial Statements](index=3&type=section&id=Item%201.%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) The company's Q1 2025 financials show total assets of $489.6 million, a net loss of $10.4 million, and a restatement of the comparative 2024 period [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $88,745 | $114,689 | | Marketable securities | $142,172 | $145,964 | | Accounts receivable | $71,485 | $64,605 | | Total current assets | $350,239 | $351,832 | | Total assets | $489,638 | $491,050 | | **Liabilities & Stockholders' Equity** | | | | Accrued litigation settlement expense | $20,250 | $0 | | Total current liabilities | $85,284 | $89,371 | | Total liabilities | $110,289 | $112,617 | | Total stockholders' equity | $379,349 | $378,433 | [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Statement of Operations Summary (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Testing services revenue | $61,921 | $53,837 | | Product revenue | $10,810 | $8,594 | | Patient and digital solutions revenue | $11,954 | $9,618 | | **Total revenue** | **$84,685** | **$72,049** | | Total operating expenses | $98,059 | $94,615 | | Loss from operations | ($13,374) | ($22,566) | | **Net loss** | **($10,353)** | **($19,888)** | | Net loss per share (Basic & Diluted) | ($0.19) | ($0.38) | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Cash Flow Summary (in thousands) | Activity | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | ($26,584) | ($15,312) | | Net cash provided by investing activities | $1,325 | $27,660 | | Net cash used in financing activities | ($643) | ($1,275) | | **Net (decrease) increase in cash** | **($25,979)** | **$11,099** | | Cash, cash equivalents and restricted cash at end of period | $89,295 | $93,882 | [Notes to Unaudited Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) Key notes detail a restatement of Q1 2024 financials, significant revenue from Medicare, a $20.25 million litigation settlement, and a new $50 million stock repurchase program - The company restated its financial statements for the three months ended March 31, 2024, which increased the previously reported net loss from **$16.7 million to $19.9 million** due to corrections in stock-based compensation expense[29](index=29&type=chunk)[31](index=31&type=chunk) - Revenue from Medicare represented approximately **37% of total revenue** for the three months ended March 31, 2025, up from 33% in the same period of 2024[37](index=37&type=chunk) - In the ongoing litigation with Natera, a court overturned a jury verdict against CareDx in February 2025, concluding Natera's patents were invalid, and the previously recognized **$96.3 million liability was derecognized** as of December 31, 2024[67](index=67&type=chunk) - The company reached an agreement-in-principle to settle a Securities Class Action lawsuit for approximately **$20.25 million**, recording a net litigation settlement expense of approximately **$5.4 million** in Q1 2025[77](index=77&type=chunk) - On February 20, 2025, the Board of Directors approved a new Stock Repurchase Program authorizing the purchase of up to **$50 million in common stock** over two years, with no shares repurchased as of March 31, 2025[97](index=97&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=27&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Q1 2025 revenue grew 18% year-over-year to $84.7 million, net loss improved to $10.4 million, and the company maintains a strong liquidity position with $230.9 million in cash and marketable securities Q1 2025 Financial Highlights | Metric | Q1 2025 | YoY Change | | :--- | :--- | :--- | | Total Revenue | $84.7 million | +18% | | Testing Services Revenue | $61.9 million | +15% | | Testing Services Volume | ~47,100 | +12% | | GAAP Net Loss | ($10.4 million) | Improved from ($19.9M) | | Cash & Marketable Securities | $230.9 million | N/A | [Results of Operations](index=31&type=section&id=Results%20of%20Operations) - Testing services revenue grew **15% YoY to $61.9 million**, primarily driven by a 12% increase in testing volume across all organs[128](index=128&type=chunk) - Product revenue increased **26% YoY to $10.8 million**, mainly due to higher sales of commercial NGS-based kitted solutions[129](index=129&type=chunk) - Patient and digital solutions revenue rose **24% YoY to $12.0 million**, driven by digital solutions like Ottr software and higher pharmacy sales[130](index=130&type=chunk) - General and administrative expenses decreased by **$7.4 million (24%) YoY**, primarily due to a $6.4 million reduction in stock-based compensation and a $2.0 million decrease in legal expenses[136](index=136&type=chunk) - A litigation settlement expense of **$5.4 million** was recorded in Q1 2025 related to the settlement of the Securities Class Action lawsuit[137](index=137&type=chunk) [Liquidity and Capital Resources](index=32&type=section&id=Liquidity%20and%20Capital%20Resources) - As of March 31, 2025, the company had **$230.9 million in cash, cash equivalents, and marketable securities**, with no outstanding debt[149](index=149&type=chunk) - The company has an accumulated deficit of **$636.6 million** as of March 31, 2025[149](index=149&type=chunk) - Management believes existing cash and expected cash from operations will be sufficient to meet cash requirements for the next 12 months[150](index=150&type=chunk) - A stock repurchase program, renewed in February 2025, allows for the purchase of up to **$50 million in common stock**, with the full amount available as of March 31, 2025[152](index=152&type=chunk)[153](index=153&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=35&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risks are interest rate and foreign currency fluctuations, with defined potential impacts on financial statements but no current use of hedging instruments - A hypothetical 100 basis point increase or decrease in interest rates would have an approximate impact of **$0.9 million** on the company's financial statements[160](index=160&type=chunk) - An unfavorable 10% change in foreign currency exchange rates would have negatively impacted product revenue by **$0.4 million** and the balance sheet by **$0.1 million** for the quarter ended March 31, 2025[161](index=161&type=chunk) [Item 4. Controls and Procedures](index=35&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were not effective as of March 31, 2025, due to a previously identified material weakness in internal control - Management concluded that as of March 31, 2025, the company's disclosure controls and procedures were **not effective** at a reasonable assurance level[162](index=162&type=chunk) - The ineffectiveness is due to a **material weakness** identified as of December 31, 2024, related to deficiencies in controls for complex and/or non-routine transactions[163](index=163&type=chunk)[164](index=164&type=chunk) - Management is continuing its remediation plan, which includes implementing training, updating accounting policies, and enhancing controls related to stock-based compensation[167](index=167&type=chunk)[169](index=169&type=chunk) [PART II. OTHER INFORMATION](index=37&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=37&type=section&id=Item%201.%20Legal%20Proceedings) This section references Note 8 for details on legal matters, including litigation with Natera and a securities class action settlement - The company refers to Note 8, "Commitments and Contingencies," for detailed information on its legal proceedings[170](index=170&type=chunk) [Item 1A. Risk Factors](index=37&type=section&id=Item%201A.%20Risk%20Factors) Key risks include a history of net losses, significant reliance on Medicare reimbursement, ongoing litigation, intense competition, and an unremediated material weakness in internal controls - The company has a history of substantial net losses, with an accumulated deficit of **$636.6 million** as of March 31, 2025, and expects to incur net losses for the next several years[172](index=172&type=chunk) - A substantial portion of revenue comes from Medicare, which represented **51% of testing services revenue** for Q1 2025, making financial performance highly sensitive to reimbursement changes[175](index=175&type=chunk) - The company faces significant competition from established diagnostic tests, other molecular diagnostic companies like Natera and Eurofins, and new market entrants[185](index=185&type=chunk)[186](index=186&type=chunk)[187](index=187&type=chunk) - A **material weakness** in internal control over financial reporting, first identified for fiscal year 2022, was not remediated as of December 31, 2024, posing a risk of inaccurate financial reporting[225](index=225&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=46&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company withheld shares to satisfy employee tax obligations and approved a new $50 million stock repurchase program with no shares purchased during the quarter - A total of **137,580 shares** were withheld from employees to cover tax obligations related to vested restricted stock units during the three months ended March 31, 2025[232](index=232&type=chunk) - A new stock repurchase program for up to **$50 million** was approved on February 20, 2025, with no shares repurchased under this program in Q1 2025[233](index=233&type=chunk) [Item 3. Defaults Upon Senior Securities](index=46&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) None [Item 4. Mine Safety Disclosures](index=46&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) Not applicable [Item 5. Other Information](index=46&type=section&id=Item%205.%20Other%20Information) No directors or officers adopted or terminated Rule 10b5-1 trading plans during the quarter - No directors or officers adopted or terminated any Rule 10b5-1 trading plans during the three months ended March 31, 2025[236](index=236&type=chunk) [Item 6. Exhibits](index=47&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including CEO and CFO certifications

[CareDx First Quarter 2025 Results](index=1&type=section&id=CareDx%20First%20Quarter%202025%20Results) [Financial Highlights](index=1&type=section&id=First%20Quarter%20Financial%20Highlights) CareDx reported strong Q1 2025 financial performance with 18% revenue growth to $84.7 million, achieving non-GAAP net income of $5.4 million and adjusted EBITDA of $4.6 million, and maintaining a solid $231 million cash position Q1 2025 Key Financial Metrics | Metric | Q1 2025 | Q1 2024 | Change (YoY) | | :--- | :--- | :--- | :--- | | Total Revenue | $84.7M | $72.0M | +18% | | Testing Services Revenue | $61.9M | $53.8M | +15% | | GAAP Net Loss | ($10.4M) | ($19.9M) | 48% Improvement | | Non-GAAP Net Income/(Loss) | $5.4M | ($1.4M) | Significant Improvement | | Adjusted EBITDA | $4.6M | ($1.9M) | Significant Improvement | | Cash & Marketable Securities | $231M | N/A | N/A | - The company reaffirmed its full-year 2025 guidance for revenue of **$365 million to $375 million** and adjusted EBITDA of **$29 million to $33 million** and maintained its 2027 target of **$500 million** in revenue and **$100 million** in adjusted EBITDA[6](index=6&type=chunk)[10](index=10&type=chunk) [Business Highlights](index=1&type=section&id=First%20Quarter%20Business%20Highlights) CareDx achieved its seventh consecutive quarter of sequential growth in testing services volume, reaching approximately 47,100 tests, while advancing strategic initiatives for AlloSure®, AlloHeme™, and Revenue Cycle Management - Testing services volume grew to approximately **47,100**, marking the seventh consecutive quarter of sequential growth[1](index=1&type=chunk)[6](index=6&type=chunk) - Launched two expanded indications for AlloSure® Testing Services: AlloSure Heart for pediatric patients and AlloSure Kidney for simultaneous pancreas-kidney (SPK) transplant patients[6](index=6&type=chunk) - Advanced the AlloHeme™ pipeline with data presentations at the TANDEM and EBMT conferences[4](index=4&type=chunk)[6](index=6&type=chunk) - Completed the restructuring of the Revenue Cycle Management team to drive Average Selling Price (ASP) growth and launched a strategic initiative to enhance integration with EPIC AURA EMR systems[6](index=6&type=chunk) [Detailed Financial Results](index=1&type=section&id=Q1%202025%20Financial%20Results) Q1 2025 total revenue reached $84.7 million, up 18% YoY, driven by growth across all segments, significantly narrowing GAAP net loss to $10.4 million and achieving non-GAAP net income of $5.4 million Q1 Revenue Breakdown (YoY) | Revenue Segment | Q1 2025 | Q1 2024 | Growth | | :--- | :--- | :--- | :--- | | Testing Services | $61.9M | $53.8M | +15% | | Patient and Digital Solutions | $12.0M | $9.6M | +24% | | Product | $10.8M | $8.6M | +26% | | **Total Revenue** | **$84.7M** | **$72.0M** | **+18%** | - Testing Services revenue for Q1 2025 included a **$1.1 million** write-off for aged receivables, with non-GAAP adjusted testing services revenue at **$63.0 million** excluding this[5](index=5&type=chunk)[7](index=7&type=chunk) Q1 Profitability (YoY) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | GAAP Net Loss | ($10.4M) | ($19.9M) | | GAAP Net Loss per Share | ($0.19) | ($0.38) | | Non-GAAP Net Income/(Loss) | $5.4M | ($1.4M) | | Non-GAAP Diluted Net Income/(Loss) per Share | $0.09 | ($0.03) | | Adjusted EBITDA | $4.6M | ($1.9M) | [Financial Statements](index=4&type=section&id=Financial%20Statements) The financial statements detail an 18% revenue increase and reduced operating loss to $13.4 million, while the balance sheet shows stable total assets at $489.6 million and a strong equity position with no debt [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Q1 2025 total revenues were $84.7 million, with operating expenses of $98.1 million, resulting in a $13.4 million loss from operations and a GAAP net loss of $10.4 million, or $0.19 per share Q1 2025 Statement of Operations Highlights (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total Revenue | $84,685 | $72,049 | | Total Operating Expenses | $98,059 | $94,615 | | Loss from Operations | ($13,374) | ($22,566) | | Net Loss | ($10,353) | ($19,888) | | Net Loss per Share (Basic & Diluted) | ($0.19) | ($0.38) | [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, CareDx held $230.9 million in cash and marketable securities, with total assets of $489.6 million, total liabilities of $110.3 million, and total stockholders' equity of $379.3 million, with no debt Balance Sheet Highlights (in thousands) | Line Item | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $88,745 | $114,689 | | Marketable securities | $142,172 | $145,964 | | Total Assets | $489,638 | $491,050 | | Total Liabilities | $110,289 | $112,617 | | Total Stockholders' Equity | $379,349 | $378,433 | [2025 Guidance](index=2&type=section&id=2025%20Guidance) CareDx reaffirms its full-year 2025 financial guidance, projecting total revenue between $365 million and $375 million and adjusted EBITDA between $29 million and $33 million Full-Year 2025 Guidance | Metric | Guidance Range | | :--- | :--- | | Revenue | $365M - $375M | | Adjusted EBITDA | $29M - $33M | [Non-GAAP Financial Measures & Reconciliations](index=2&type=section&id=Use%20of%20Non-GAAP%20Financial%20Measures) CareDx uses non-GAAP measures like adjusted EBITDA and non-GAAP net income to clarify core operating performance, reporting Q1 2025 non-GAAP net income of $5.4 million and adjusted EBITDA of $4.6 million - The company uses non-GAAP financial measures to assist investors in assessing operating results by excluding items like stock-based compensation, acquisition-related amortization, and litigation settlement expenses[14](index=14&type=chunk)[15](index=15&type=chunk) Reconciliation of GAAP Net Loss to Non-GAAP Net Income (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **GAAP Net Loss** | **($10,353)** | **($19,888)** | | Stock-based compensation | $8,931 | $16,573 | | Acquisition related-amortization | $1,539 | $1,653 | | Litigation settlement expense | $5,360 | $0 | | Other adjustments | $46 | $214 | | **Non-GAAP Net Income (Loss)** | **$5,424** | **($1,448)** | Reconciliation to Adjusted EBITDA (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Non-GAAP Net Income (Loss)** | **$5,424** | **($1,448)** | | Interest income | ($2,784) | ($2,885) | | Income tax expense | $157 | $19 | | Depreciation expense | $2,061 | $2,168 | | Other (income) expense, net | ($295) | $290 | | **Adjusted EBITDA** | **$4,563** | **($1,856)** |

Core Viewpoint - A shareholder class action lawsuit has been filed against CareDx, Inc. for allegedly making false and misleading statements regarding its business practices and financial success during the Class Period from April 30, 2020, to November 3, 2022 [1] Group 1: Allegations Against CareDx - CareDx is accused of attributing its financial success to legitimate demand for its testing services, while in reality, it relied on unethical practices, including fraudulent billing to Medicare for unnecessary tests and paying kickbacks to doctors [2] - The company allegedly exploited its RemoTraC home testing program to promote its AlloSure tests, which cost Medicare $2,841 each, to patients who did not require them [2] Group 2: Impact on Stock and Investor Awareness - The lawsuit highlights a series of partial disclosures that revealed the truth about CareDx's operations between October 2021 and November 2022 [3] - On October 28, 2021, CareDx's stock price dropped by $19.34 per share, over 27%, following the announcement of investigations by the DOJ, SEC, and a state regulatory agency related to a False Claims Act investigation [4] - The stock continued to decline, reaching as low as $16.00 per share, as further negative information was disclosed, including executive resignations and a whistleblower complaint [4] Group 3: Legal Proceedings - The investigation aims to determine whether CareDx's board of directors violated securities laws or breached fiduciary duties in connection with the alleged misconduct [5] - Current shareholders who purchased shares before October 28, 2021, are encouraged to seek information about their legal rights and options [6]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ________________________________________________________________________________________________________ Form 10-K ________________________________________________________________________________________________________ (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF TH ...

Financial Data and Key Metrics Changes - CareDx reported Q4 2024 revenue of $86.6 million, a 32% increase year-over-year, and full-year revenue of $334 million, up 19% year-over-year [10][36] - Adjusted EBITDA for Q4 was $9.8 million, with a full-year adjusted EBITDA of $27.8 million, compared to an adjusted EBITDA loss of $38 million in 2023 [10][42] - The company ended the year with a cash balance of $261 million and no debt, generating $22 million in cash from operations in Q4 [10][44] Business Line Data and Key Metrics Changes - Testing Services revenue was $63.8 million in Q4, up 37% year-over-year, with approximately 45,500 tests delivered, a 14% increase from the prior year [12][13] - Patient and Digital Solutions revenue reached approximately $11.4 million in Q4, representing an 18% year-over-year growth [15] - Lab Products revenue was $11.4 million, showing a 23% year-over-year growth, driven by sales of AlloSeq Tx NGS-based HLA typing kits [17] Market Data and Key Metrics Changes - CareDx expanded AlloMap Heart coverage to 21 million commercial lives and added 12.2 million new commercial covered lives for AlloSure in Q4 [14] - For the full year 2024, the company added or expanded coverage for 28 million lives for AlloMap Heart and 36 million new commercial covered lives for AlloSure [14] Company Strategy and Development Direction - CareDx aims for long-term profitable growth, targeting $370 million in revenue for 2025 and $500 million by 2027, with a focus on operational excellence and evidence generation to expand payer coverage [10][20] - The company plans to launch several new products in 2025, including AlloSure Heart for pediatric patients and AlloSure Kidney for simultaneous pancreas and kidney transplant patients [26] Management's Comments on Operating Environment and Future Outlook - Management highlighted 2024 as a transformational year and expressed confidence in achieving significant milestones in 2025, particularly in expanding testing services and payer coverage [20][22] - The company anticipates continued adoption of surveillance testing and expects to see a ramp-up in testing volumes as transplant centers implement new protocols [76][112] Other Important Information - The company reported a reversal of a $96 million liability related to patent litigation, resulting in a positive GAAP net income of approximately $52.5 million for 2024 [42] - CareDx has authorized a share buyback program of up to $50 million over two years, following a previous buyback of approximately $29 million [44] Q&A Session Summary Question: Can you talk about efforts in converting existing accounts with less than 3 solutions to 3 or more solutions? - Management emphasized the focus on synergistic solutions and the importance of the XynQAPI product for quality reporting, which is expected to drive growth in testing services [56] Question: What is the path forward regarding litigation after the reversal of the $96 million verdict? - Management indicated that the litigation may be appealed but emphasized the importance of capital allocation towards growth opportunities and share buybacks if no strategic investments are identified [66] Question: Can you clarify how much revenue from prior period collections impacted Q4 and 2025 guidance? - Q4 revenue included about $2.2 million from prior period collections, with a total of $17 million recognized throughout 2024, but no contribution from these collections is included in the 2025 guidance [72][73] Question: How much of the mid-teens volume growth in 2025 is expected from increased surveillance testing? - Management believes surveillance testing will significantly contribute to volume growth, with ongoing discussions with transplant centers to implement protocols [75][112] Question: What opportunities exist to improve revenue capture through the billing organization? - Management discussed the restructuring of the billing team and the implementation of improved processes to enhance cash collection and billing efficiency [87][91]

The Transplant Solutions Company •F E B R U A R Y 2 6 , 2 0 2 5 Click to edit Master text styles Click to edit Master title style Patrick G, Kidney Transplant Recipient Safe Harbor Statement These slides and the accompanying oral presentation contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact contained in this presentation, i ...

Financial Data and Key Metrics Changes - CareDx reported quarterly revenue of $86.6 million for Q4 2024, representing a 32% year-over-year increase [10] - Full year 2024 revenue reached $334 million, up 19% year-over-year, exceeding the high end of guidance [36] - Adjusted EBITDA for Q4 was $9.8 million, with a full year adjusted EBITDA of $27.8 million, a significant improvement from a loss of $38 million in 2023 [10][42] - The company ended the year with a cash balance of $261 million and no debt, generating $22 million in cash from operations in Q4 [10][44] Business Line Data and Key Metrics Changes - Testing Services revenue for Q4 was $63.8 million, up 37% year-over-year, with approximately 45,500 tests delivered, marking a 14% increase [12][13] - Patient and Digital Solutions revenue was approximately $11.4 million in Q4, representing an 18% year-over-year growth [15] - Lab Products revenue also reached $11.4 million, showing a 23% year-over-year increase, driven by sales of AlloSeq Tx NGS-based HLA typing kits [17] Market Data and Key Metrics Changes - CareDx expanded payer coverage significantly, adding or expanding coverage for 28 million lives for AlloMap Heart and 36 million lives for AlloSure in 2024 [14] - Approximately 5% of CareDx's revenue comes from outside the U.S., with significant potential for growth in the European market [19] Company Strategy and Development Direction - The company aims for long-term profitable growth, targeting $370 million in revenue for 2025 and $500 million by 2027, with a focus on operational excellence and scaling business profitably [10][48] - Key growth drivers include a go-to-market strategy to provide comprehensive solutions to transplant centers, evidence generation to expand payer coverage, and operational excellence to improve efficiency [20][22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving significant milestones in 2025, particularly with the anticipated implementation of the IOTA program for kidney transplant centers [23][24] - The company is focused on enhancing patient adherence to immunosuppressants through a medication therapy management program launching in 2025 [26] Other Important Information - The company has initiated a share buyback program of up to $50 million over two years, reflecting confidence in its financial position [44] - A significant legal victory reversed a prior $96 million verdict, positively impacting the company's financial statements for 2024 [42] Q&A Session Summary Question: Can you discuss efforts in converting existing accounts with fewer than three solutions to three or more solutions? - Management highlighted the focus on the XynQAPI product for quality reporting and the launch of a medication therapy management program to assist patients with drug interactions, which will drive the use of AlloSure [56] Question: What is the path forward regarding litigation after the reversal of the $96 million verdict? - Management indicated that while an appeal is likely, the reversal allows for strategic capital allocation, including reinvestment in growth opportunities and share buybacks [66] Question: Can you clarify the impact of prior period collections on Q4 revenue and guidance for 2025? - Q4 revenue included approximately $2.2 million from prior period collections, with no contributions from these one-time tests included in the 2025 guidance [72][73] Question: How much of the mid-teens volume growth in 2025 is expected from increased surveillance testing? - Management believes surveillance testing will significantly contribute to mid-teens volume growth, with ongoing discussions to turn on protocols at transplant centers [75] Question: What opportunities exist to improve revenue capture through the billing organization? - The company is focused on enhancing billing processes and systems to improve cash collection, with a new leader in place to drive these initiatives [87][90] Question: Can you remind us of the objectives of the KOAR study? - The KOAR study is a prospective multicenter study evaluating the efficacy of AlloSure Kidney to detect rejection, which is crucial for payer acceptance and product adoption [96]

Core Insights - CareDx reported $86.58 million in revenue for Q4 2024, a 32% year-over-year increase, with an EPS of $0.18 compared to -$0.17 a year ago [1] - The revenue exceeded the Zacks Consensus Estimate of $85.5 million by 1.26%, and the EPS surpassed the consensus estimate of $0.07 by 157.14% [1] Revenue Breakdown - Revenue from Patient and Digital Solutions was $11.39 million, exceeding the average estimate of $10.99 million by analysts, representing an 18.4% year-over-year increase [4] - Revenue from Testing Services reached $63.82 million, compared to the average estimate of $62.20 million, marking a 36.7% year-over-year increase [4] - Revenue from Products was $11.37 million, surpassing the average estimate of $10.83 million, reflecting a 23% year-over-year increase [4] Stock Performance - CareDx shares have returned -8.5% over the past month, while the Zacks S&P 500 composite has changed by -2.3% [3] - The stock currently holds a Zacks Rank 2 (Buy), indicating potential for outperformance in the near term [3]