Natera (NTRA) Q2 2025 Earnings Call August 07, 2025 04:30 PM ET Company ParticipantsMike Brophy - CFOSteve Chapman - CEO & DirectorSolomon Moshkevich - President - Clinical DiagnosticsAlexey Aleshin - GM - Oncology and ECD & Chief Medical OfficerPuneet Souda - Senior MD - Life Science Tools & DiagnosticsDoug Schenkel - MD - Life Science Tools & DiagnosticsTycho Peterson - MD - Global EquitiesConference Call ParticipantsDaniel Brennan - MD & Senior Equity Research AnalystCatherine Schulte - Senior Research A ...

Natera (NTRA) Q2 2025 Earnings Call August 07, 2025 04:30 PM ET Speaker0Hello. Welcome to Natera's twenty twenty five Second Quarter Financial Results Conference Call. At this time, all participants are in a listen only mode. Following management's prepared remarks, we will hold a question and answer session. As a reminder, this conference call is being recorded today, 08/07/2025.I would now like to turn the conference call over to Michael Brophy, Chief Financial Officer. Please go ahead.Speaker1Thanks, ope ...

Natera, Inc. Q2'2025 Earnings Presentation 2 Q2 2025 highlights and recent business updates August 7, 2025 Safe harbor statement This presentation contains forward-looking statements under the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts contained in this presentation, including statements regarding our market opportunity, our anticipated products and launch schedules, our reimbursement coverage and our product costs, our commercia ...

Exhibit 99.1 Natera Reports Second Quarter 2025 Financial Results AUSTIN, Texas, August 7, 2025 /PRNewswire/ — Natera, Inc. (NASDAQ: NTRA), a global leader in cell-free DNA and precision medicine, today reported its financial results for the second quarter ended June 30, 2025. Recent Financial Highlights "We delivered outstanding results in the second quarter, with record Signatera growth and continued strength across our women's health and organ health product lines," said Steve Chapman, chief executive of ...

Financial Data and Key Metrics Changes - The company achieved over $500 million in revenue for the first time, marking a significant milestone [7] - Gross margins improved by more than 100 basis points sequentially from Q4 [8] - The company generated substantial cash flow in Q1, reaffirming its goal to be cash flow breakeven for the year [38][39] Business Line Data and Key Metrics Changes - Signatera saw record growth with approximately 165,000 units in Q1, indicating a strong annualized potential of around 720,000 units [15] - The women's health business experienced high single-digit growth sequentially from Q4, benefiting from market consolidation and increased volume from competing labs exiting the space [5][30] - Oregon Health reported over 50% year-on-year growth within its franchise [6] Market Data and Key Metrics Changes - The NIPT market is maturing, with Natera capturing significant volume from competitors that have exited the market [5][30] - The company noted a shift in the mix of Signatera volumes, with expectations for a gradual increase in recurrence monitoring as more patients remain on the test over time [21][22] Company Strategy and Development Direction - The core growth driver for Signatera is the unmet clinical need for MRD testing, with a focus on delivering high-quality prospective outcomes data [14][16] - The company plans to launch a tumor-naive MRD test to address a segment of patients who are not suitable for tumor-informed tests [19] - Natera is targeting a launch in Japan by 2027, with expectations for rapid adoption due to the prevalence of colorectal cancer and existing guidelines for MRD usage [28][66] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing growth of Signatera despite increased competition, emphasizing the importance of solving clinical problems for patients [56][59] - The company is committed to investing in R&D and commercial operations to maintain its competitive edge and address the unmet needs in the MRD market [37][50] Other Important Information - The company highlighted the importance of customer service and innovation in driving growth within the women's health segment [34][36] - Management noted that the competitive landscape is evolving, with established companies entering the MRD market, but they view this as an opportunity for overall improvement in patient outcomes [56][58] Q&A Session Summary Question: What are the main growth drivers for Signatera? - The main growth driver is the clinical problem of MRD, with significant room for adoption as efficacy data continues to support its use [14][15] Question: How is the mix between adjuvant and recurring volumes changing? - The mix has historically been balanced, but there is an expectation for a shift towards more recurring volumes as patients continue monitoring over time [21][22] Question: What is driving the momentum towards achieving an ASP of $2,000 for Signatera? - The momentum is driven by improving reimbursement rates among Medicare Advantage patients and potential launches in new markets like Japan [23][24][28] Question: How does the company view competition in the MRD market? - Competition is seen as a positive force that can lead to better solutions for patients, and the company is focused on addressing clinical needs rather than solely defending market share [56][59] Question: What is the strategy for R&D investments moving forward? - The company plans to increase R&D investments, particularly in generating evidence for MRD and recurrence monitoring, while also exploring partnerships for clinical trials [46][50]

Company Overview - Natera is a genetic testing company focusing on oncology, women's health, and organ health [1] - The company's signature product, Signatera, is designed to predict the efficacy of various cancer treatments [1] Investment Insights - The author emphasizes the importance of studying earnings reports to identify potential investment opportunities, highlighting a successful investment strategy during the pandemic [1] - The author mentions identifying future winners such as OPRX, OTRK, FUBO, and PLUG through careful analysis of earnings transcripts and reports [1]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) ⌧ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2025 OR ◻ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-37478 (Registrant's Telephone Number, Including Area Code) NATERA, INC. (Exact Name of Registrant as Specifie ...

Natera (NTRA) came out with a quarterly loss of $0.50 per share versus the Zacks Consensus Estimate of a loss of $0.59. This compares to loss of $0.56 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 15.25%. A quarter ago, it was expected that this genetic testing company would post a loss of $0.42 per share when it actually produced a loss of $0.41, delivering a surprise of 2.38%.Over the last four quarters, the company has su ...

Financial Data and Key Metrics Changes - The company generated $520 million in revenue for Q1 2025, representing approximately 37% growth compared to $368 million in Q1 2024 [7][32] - Gross margins improved to 63% in Q1 2025, up from 52% a year ago, with underlying gross margin improvement of about 110 basis points from Q4 2024 [8][33] - The company generated $23 million in cash during the quarter while increasing investments in growth [8][20] Business Line Data and Key Metrics Changes - Women's Health volumes increased significantly, with over 40,000 units processed sequentially in Q1 2025 compared to Q4 2024 [14][81] - Organ Health saw over 50% year-on-year growth, driven by interest in donor-derived cell-free DNA tests [14] - Signatera clinical volumes grew 52% year-on-year, with a record increase of approximately 16,500 units compared to Q4 2024 [8][15] Market Data and Key Metrics Changes - The company processed 855,000 tests in Q1 2025, an 8% sequential increase over Q4 2024 [13] - The oncology segment is seeing significant growth, with over 45% of oncologists in the U.S. ordering Signatera tests last quarter [16] - The company expects revenues for the full year to be in the range of $1.94 billion to $2.02 billion, reflecting a $70 million increase from prior guidance [9] Company Strategy and Development Direction - The company is focused on expanding clinical utility and innovating to help more patients, particularly in oncology [16][21] - There is a strategic emphasis on increasing average selling prices (ASPs) through improved reimbursement operations and expanding into new tumor types [18][20] - The company aims to achieve gross margins above 70% over time, with significant potential opportunities identified [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the sustainability of volume growth and ASP improvements, despite potential short-term headwinds from new product launches [35][36] - The company views 2025 as a crucial investment year, particularly for Signatera, with expectations of continued strong cash flow generation [20][37] - Management highlighted the importance of upcoming clinical data presentations at major conferences, which are expected to drive further growth [25][29] Other Important Information - The company has maintained a strong balance sheet with nearly $1 billion in cash and no debt outside of a line of credit [33] - The DEFINE study in heart transplantation demonstrated Prospera's ability to predict clinical outcomes, outperforming traditional biopsy methods [10][22] - The company is preparing for significant data presentations at ASCO, with nearly 30 abstracts planned across multiple tumor types [28][29] Q&A Session Summary Question: What drove the sequential volume growth in Signatera? - Management noted that strong clinical utility and data performance resonated with physicians, contributing to record growth [42] Question: Which clinical studies should be focused on for potential market impact? - Management highlighted the I SPY two trial and the DARE study as significant upcoming studies that could influence market volumes [45][46] Question: Were there any disruptions in Q1 due to weather or calendar dynamics? - Management acknowledged weather challenges but indicated that patient demand for tests remained strong, minimizing impact on volumes [54][56] Question: What is the outlook for ASPs and reimbursement? - Management expects stable ASPs in women's and organ health, with modest improvements in Signatera driven by increased Medicare Advantage coverage [74] Question: Can you provide an update on the colorectal screening front? - Management confirmed that the PRESIDE study has met its enrollment goals and will report results by the end of the year, with an FDA enabling study also underway [67][68]

Financial Data and Key Metrics Changes - The company generated $520 million in revenue for Q1 2025, representing approximately 37% growth compared to $368 million in Q1 2024 [5][6][14] - Gross margins improved to 63% in Q1 2025, up from 39% in previous quarters, with an underlying gross margin improvement of about 110 basis points from 59.3% in Q4 2024 to 60.4% in Q1 2025 [15][16][30] - The company generated $23 million in cash during the quarter, indicating strong cash flow generation despite increased investments in growth [6][17][30] Business Line Data and Key Metrics Changes - Women's Health volumes grew significantly, with over 40,000 units processed sequentially in Q1 2025, continuing strong growth from 2024 [12][30] - Organ Health saw over 50% year-on-year growth, driven by interest in donor-derived cell-free DNA and germline tests [12][30] - Signatera clinical volumes grew 52% year-on-year, with a record increase of approximately 16,500 units compared to Q4 2024 [6][13][14] Market Data and Key Metrics Changes - The company processed 855,000 tests in Q1 2025, an 8% sequential increase over Q4 2024 [11][12] - The oncology market is expanding, with over 45% of oncologists in the U.S. ordering Signatera tests last quarter [13][14] - The company anticipates that Signatera could eventually generate more than $5 billion in annual revenue, reflecting significant market potential [17][30] Company Strategy and Development Direction - The company is focused on expanding clinical utility and innovating to help more patients, particularly in oncology and women's health [13][17] - The company plans to continue funding high return on invested capital (ROIC) investments in commercial operations, clinical trials, and product improvements [17][30] - The company aims to achieve gross margins above 70% over time, with ongoing improvements in average selling prices (ASPs) and cost of goods sold (COGS) [16][17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the sustainability of revenue growth, driven by strong clinical utility and data generated from studies [41][42] - The company is optimistic about upcoming data presentations at major conferences, which are expected to enhance market presence and drive future growth [43][44] - Management highlighted the importance of maintaining cash flow breakeven while investing in growth opportunities, particularly in oncology [30][34] Other Important Information - The company raised its revenue guidance for 2025 to a range of $1.94 billion to $2.02 billion, reflecting a $70 million increase from previous guidance [7][31] - The company is preparing for significant data presentations at ASCO and ESMO conferences, with nearly 30 abstracts planned [25][26] - The company is also pursuing expansion into new histologies, including sarcoma, which presents a significant clinical unmet need [24][25] Q&A Session Summary Question: What drove the sequential volume growth in Signatera? - Management noted that strong clinical utility and a large commercial presence contributed to the record sequential growth, with expectations for continued utilization [40][41] Question: Which clinical studies should be focused on for potential volume growth? - Management highlighted the I SPY two trial and the DARE study as significant upcoming studies that could impact volumes positively [42][43] Question: Did weather or calendar dynamics affect Q1 performance? - Management acknowledged that weather challenges existed but did not significantly impact volumes, as patients still sought necessary tests [54][56] Question: What is the outlook for ASPs and reimbursement? - Management indicated stable ASPs in women's health and organ health, with modest improvements expected in Signatera due to increased reimbursement rates [71][75] Question: What is the status of the colorectal screening study? - Management confirmed that the PRESIDE study has met its enrollment goals and results are expected by the end of the year [67][68]