Core Viewpoint - OraSure Technologies (NASDAQ: OSUR) is identified as undervalued with a robust balance sheet, despite facing increased market scrutiny in the healthcare sector [1]. Company Analysis - Since December 2024, OSUR's stock has become cheaper, indicating a potential investment opportunity amidst market challenges [1]. - The company is perceived to have relatively low risk due to its strong financial position [1]. Analyst Background - The analyst has extensive experience in investment banking, focusing on both public and private market opportunities, and has a strong educational background with an MBA from a Top-20 US Business School [1]. - The analyst has a history of success in stock pitching competitions and has interned at various investment firms, enhancing their research capabilities [1]. - The analyst emphasizes a long-only investment strategy, influenced by value investing principles, and focuses on companies with competitive advantages and growth prospects [1].

Core Insights - OraSure Technologies reported a quarterly loss of $0.18 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.15, and a decline from earnings of $0.04 per share a year ago, indicating an earnings surprise of -20% [1] - The company posted revenues of $29.93 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 0.73%, but down from $54.13 million in the same quarter last year [2] - OraSure shares have declined approximately 22.4% since the beginning of the year, contrasting with the S&P 500's decline of -4.7% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is -$0.12 on revenues of $33.46 million, and for the current fiscal year, it is -$0.40 on revenues of $136.26 million [7] - The estimate revisions trend for OraSure is mixed, resulting in a Zacks Rank 3 (Hold), suggesting the shares are expected to perform in line with the market in the near future [6] Industry Context - The Medical - Products industry, to which OraSure belongs, is currently ranked in the bottom 28% of over 250 Zacks industries, indicating potential challenges for stock performance [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact investor sentiment and stock performance [5]

Financial Data and Key Metrics Changes - Total revenue in Q1 was $29,900,000, with core revenue of $29,500,000, reflecting a 2% decrease year over year [26][27] - GAAP gross margin for Q1 was 41.1%, while non-GAAP gross margin was 41.7%, consistent with expectations [28] - Operating cash flow in Q1 was negative $19,700,000, aligning with expectations due to investments in innovation [28] Business Line Data and Key Metrics Changes - Diagnostics revenue grew 8% year over year, generating $17,700,000 in Q1 [26] - Sample Management Solutions (SMS) revenue decreased 16% year over year to $9,100,000, primarily due to disruption at a large customer in the consumer genomics segment [27][9] - Core revenue was flat year over year after adjusting for the exit from the risk assessment testing business [9] Market Data and Key Metrics Changes - International diagnostics business remained steady, with growth driven by initial orders for the WHO PQ listed hepatitis C self-test [10][12] - The US diagnostics market faced increased headwinds due to budget cuts and staffing reductions at public health organizations [14][16] - Overall market trends in SMS were mixed, with growth in clinical genomics and animal health offset by softness in academic and research labs [11] Company Strategy and Development Direction - The company is focused on three pillars of transformation: strengthening the foundation, elevating core growth, and accelerating profitable growth [5] - Integration of Sherlock Biosciences is progressing well, enhancing the product pipeline with molecular diagnostics innovations [7] - The company plans to launch new products in 2025, including microbiome extraction kits and blood proteomics sample stabilization [35] Management's Comments on Operating Environment and Future Outlook - Management noted ongoing uncertainty in funding for public health initiatives but expressed confidence in the company's ability to navigate these challenges [12][14] - The company is exploring alternative funding sources and maintaining strong relationships with existing customers [39][40] - Management remains optimistic about the potential for growth in international markets despite current funding uncertainties [39] Other Important Information - The board authorized a stock repurchase program of up to $40,000,000 over the next two years, funded from cash on hand [8][29] - The company is transitioning to in-house manufacturing, expected to be substantially complete by the end of Q2 [18][19] Q&A Session Summary Question: What is the outlook for international revenue and HIV testing demands given funding uncertainties? - Management indicated that conversations with funding sources are ongoing and that there is a steady but flat trajectory for international revenue [39][40] Question: Did the company see any pull forward in demand ahead of possible tariffs? - Management confirmed there was no pull forward in demand and noted minimal impact from tariffs due to the transition to US manufacturing [42][43] Question: What is the expected impact of the Together, Take Me Home initiative? - Management confirmed a $4,000,000 headwind for fiscal 2025, with $1,500,000 already recognized in Q1 [49][50] Question: What is the status of the SMS genomics customer and future ordering activity? - Management stated there is no visibility for future orders from the disrupted customer but emphasized growth in SMS from other customers [51][54] Question: What is the expected impact of PEPFAR funding disruptions? - Management noted that the PEPFAR impact for Q1 was around $1,000,000, with expectations for similar levels in Q2 [56][57]

Part I. Financial Information [Financial Statements](index=8&type=section&id=Item%201.%20Financial%20Statements) OraSure Technologies, Inc. presents unaudited consolidated financial statements for Q1 2025, showing decreased revenue, a **$16,040 thousand** net loss, and the impact of the Sherlock Biosciences acquisition [Consolidated Balance Sheets](index=8&type=section&id=Consolidated%20Balance%20Sheets) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$457,607** | **$479,659** | | Cash and cash equivalents | $247,569 | $267,763 | | Total current assets | $313,781 | $333,220 | | **Total Liabilities** | **$61,325** | **$69,321** | | Total current liabilities | $25,422 | $33,483 | | **Total Stockholders' Equity** | **$396,282** | **$410,338** | - Total assets decreased by **$22,052 thousand** from December 31, 2024, to March 31, 2025, primarily due to a **$20,194 thousand** decrease in cash and cash equivalents[16](index=16&type=chunk) [Consolidated Statements of Operations](index=9&type=section&id=Consolidated%20Statements%20of%20Operations) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Net Revenues** | **$29,931** | **$54,132** | | Gross Profit | $12,299 | $24,065 | | Operating Loss | $(17,750) | $(7,093) | | **Net Loss** | **$(16,040)** | **$(3,584)** | | Diluted Loss Per Share | $(0.21) | $(0.05) | - Net revenues decreased by **44.7%** year-over-year, primarily due to a sharp decline in COVID-19 product sales. The net loss widened significantly from **$3,584 thousand** in Q1 2024 to **$16,040 thousand** in Q1 2025[18](index=18&type=chunk)[54](index=54&type=chunk) [Consolidated Statements of Cash Flows](index=11&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $(19,733) | $6,739 | | Net cash provided by (used in) investing activities | $370 | $(46,528) | | Net cash used in financing activities | $(953) | $(1,298) | | **Net Decrease in Cash** | **$(20,194)** | **$(43,262)** | - The company experienced a significant shift in operating cash flow, from a **$6,739 thousand** inflow in Q1 2024 to a **$19,733 thousand** outflow in Q1 2025. This was primarily driven by the net loss and changes in working capital, including payment of year-end bonuses[23](index=23&type=chunk)[117](index=117&type=chunk) [Notes to the Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) Key notes detail inventory valuation changes, the Sherlock Biosciences acquisition, a steep drop in COVID-19 sales, workforce reductions, and a new stock repurchase program - The company changed its inventory valuation method from FIFO to average cost in Q1 2025 for greater precision, with an immaterial effect[27](index=27&type=chunk) - In December 2024, the company acquired Sherlock Biosciences for **$5.0 million** cash and up to **$20.0 million** contingent consideration, expanding its rapid diagnostics portfolio[73](index=73&type=chunk)[74](index=74&type=chunk)[75](index=75&type=chunk) Net Revenues by Product Line (in thousands) | Product Line | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | HIV | $12,900 | $13,380 | | Sample Management Solutions | $9,110 | $10,822 | | HCV | $4,333 | $3,000 | | COVID-19 | $461 | $23,128 | - COVID-19 product revenue plummeted from **$23,128 thousand** in Q1 2024 to just **$461 thousand** in Q1 2025, with a single U.S. government customer accounting for **40%** of Q1 2024 net revenues[54](index=54&type=chunk)[100](index=100&type=chunk) - In March 2025, the Board authorized a new **$40.0 million** stock repurchase program over two years, with no shares repurchased under it in Q1 2025[64](index=64&type=chunk) [Management's Discussion and Analysis (MD&A)](index=29&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses a **45%** Q1 2025 revenue decrease to **$29,931 thousand** due to a **98%** drop in COVID-19 sales, leading to a wider operating loss and reduced cash position [Results of Operations](index=30&type=section&id=Results%20of%20Operations) Net Revenues by Category (in thousands) | Category | Q1 2025 | Q1 2024 | % Change | | :--- | :--- | :--- | :--- | | Diagnostics (Core) | $17,689 | $16,380 | 8% | | Sample Management Solutions | $9,110 | $10,822 | (16)% | | COVID-19 Diagnostics | $457 | $23,097 | (98)% | | **Total Net Revenues** | **$29,931** | **$54,132** | **(45)%** | - The **98%** decrease in COVID-19 Diagnostics revenue resulted from the fulfillment of U.S. government procurement contracts for InteliSwab® tests[100](index=100&type=chunk) - Consolidated gross profit margin fell to **41.1%** from **44.5%** due to a product mix shift away from high-margin InteliSwab® sales[103](index=103&type=chunk) - Operating expenses increased, with R&D up **24%** and G&A up **21%**, primarily due to Sherlock acquisition costs and higher legal fees[105](index=105&type=chunk)[107](index=107&type=chunk) [Liquidity and Capital Resources](index=32&type=section&id=Liquidity%20and%20Capital%20Resources) Liquidity Position (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $247,569 | $267,763 | | Working capital | $288,359 | $299,737 | - Cash and cash equivalents decreased by **$20,194 thousand** during the quarter, with net cash used in operating activities totaling **$19,733 thousand**, driven by net loss and a **$6,600 thousand** decrease in accrued expenses[115](index=115&type=chunk)[117](index=117&type=chunk) - The company expects existing cash to be sufficient for operations and capital expenditures over the next twelve months[120](index=120&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=33&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) No material changes occurred in the company's assessment of market risk sensitivity since its 2024 Annual Report on Form 10-K - There has been no material change in the company's assessment of its sensitivity to market risk since its 2024 Annual Report[123](index=123&type=chunk) [Controls and Procedures](index=33&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal control over financial reporting - Management concluded the company's disclosure controls and procedures were effective as of March 31, 2025[124](index=124&type=chunk) - No material changes occurred in the company's internal control over financial reporting during Q1 2025[125](index=125&type=chunk) Part II. Other Information [Legal Proceedings](index=34&type=section&id=Item%201.%20Legal%20Proceedings) Updates on two legal matters: patent litigation with Spectrum Solutions concluded, and a trade secret lawsuit against NowDiagnostics, Inc. is scheduled for trial - The Court of Appeals affirmed the District Court's judgment in favor of Spectrum Solutions in patent litigation on February 14, 2025[127](index=127&type=chunk) - The company filed a trade secret misappropriation complaint against NowDiagnostics, Inc., with a preliminary injunction entered and trial scheduled for March 9, 2026[128](index=128&type=chunk) [Risk Factors](index=34&type=section&id=Item%201A.%20Risk%20Factors) New and supplemented risk factors include stock repurchase program impact, potential FDA disruptions, and increased geopolitical and economic risks from tariffs - A new risk factor highlights the **$40.0 million** stock repurchase program's potential to increase stock price volatility and reduce cash reserves[130](index=130&type=chunk)[131](index=131&type=chunk) - Potential disruptions at the FDA and other government agencies due to staffing or funding issues could delay product reviews and approvals[132](index=132&type=chunk)[133](index=133&type=chunk)[134](index=134&type=chunk) - Geopolitical and economic risks were supplemented, noting increased tariffs and trade protectionism could make offerings more expensive or non-competitive[135](index=135&type=chunk)[136](index=136&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=36&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) A new **$40.0 million** stock repurchase program was authorized in March 2025, replacing a prior one, with no shares repurchased under it in Q1, though shares were retired for tax obligations - A new **$40.0 million** stock repurchase program was authorized in March 2025 for two years, replacing the prior program[137](index=137&type=chunk) - During Q1 2025, **252,358** shares were retired to satisfy minimum tax withholdings on vested employee stock awards[137](index=137&type=chunk)[139](index=139&type=chunk)

OraSure Q1 2025 Performance Overview [Financial Highlights](index=1&type=section&id=Financial%20Highlights) OraSure's Q1 2025 total net revenues decreased 45% to $29.9 million, with a wider operating loss of $17.8 million Revenue by Category | Revenue Category | Q1 2025 (in thousands) | Q1 2024 (in thousands) | % Change | | :--- | :--- | :--- | :--- | | Core Business | $29,470 | $30,131 | (2)% | | Molecular Services | $0 | $873 | (100)% | | COVID-19 | $461 | $23,128 | (98)% | | **Total Net Revenues** | **$29,931** | **$54,132** | **(45)%** | Key Financial Metrics | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **GAAP Gross Margin** | 41.1% | 44.5% | | **Non-GAAP Gross Margin** | 41.7% | 45.2% | | **GAAP Operating Loss** | ($17.8 million) | ($7.1 million) | | **Non-GAAP Operating Loss** | ($15.3 million) | ($0.3 million) | | **GAAP Net Loss** | ($16.0 million) | ($3.6 million) | | **Diluted GAAP EPS** | ($0.21) | ($0.05) | | **Diluted Non-GAAP EPS** | ($0.18) | $0.04 | - Within the core business, Diagnostics revenues grew **8%** year-over-year to **$17.7 million**, while Sample Management Solutions revenues decreased **16%** to **$9.1 million**[7](index=7&type=chunk) - The company's cash and cash equivalents were **$248 million** as of March 31, 2025[7](index=7&type=chunk) [Business and Operational Highlights](index=2&type=section&id=Recent%20Business%20Developments) OraSure advances its innovation pipeline, secures partnerships, divests a product line, and authorizes a $40 million stock repurchase - The company is making progress on its innovation roadmap, with multiple new product milestones planned for 2025 to drive future growth[3](index=3&type=chunk) - Key operational updates include: - Supporting Color Health's at-home cervical cancer risk screening test with the Colli-Pee™ collection device - Renewing the customer agreement with Myriad Genetics for Oragene™ Dx saliva collection kits - Divesting assets related to the Risk Assessment testing product line, with an expected exit in Q2 - The Board of Directors authorized a **$40 million** stock repurchase program over two years[3](index=3&type=chunk)[6](index=6&type=chunk)[13](index=13&type=chunk) [Q2 2025 Financial Guidance](index=4&type=section&id=Financial%20Guidance) For Q2 2025, OraSure forecasts total revenues between $28.5 million and $32.5 million, primarily from Core revenues Q2 2025 Financial Guidance | Guidance for Q2 2025 | Amount (in millions) | | :--- | :--- | | Total Revenues | $28.5 - $32.5 | | Core Revenues | $28.0 - $32.0 | | COVID-19 & Risk Assessment Revenues | ~$0.5 | [Detailed Financial Statements](index=5&type=section&id=Financial%20Data%20%28Unaudited%29) Unaudited Q1 2025 financial statements are presented, covering results of operations, balance sheets, and cash flows [Consolidated Results of Operations](index=5&type=section&id=Results%20of%20Operations) In Q1 2025, OraSure reported $29.9 million total revenues, $12.3 million gross profit, and a $16.0 million net loss Consolidated Results of Operations | (in thousands) | Q1 2025 (in thousands) | Q1 2024 (in thousands) | | :--- | :--- | :--- | | Net revenues | $29,931 | $54,132 | | Gross profit | $12,299 | $24,065 | | Operating loss | ($17,750) | ($7,093) | | Net loss | ($16,040) | ($3,584) | | Diluted loss per share | ($0.21) | ($0.05) | Revenue by Segment | Revenue by Segment (in thousands) | Q1 2025 (in thousands) | Q1 2024 (in thousands) | % Change | | :--- | :--- | :--- | :--- | | Diagnostics | $17,689 | $16,380 | 8% | | Sample Management Solutions | $9,110 | $10,822 | (16)% | | Risk Assessment Testing | $1,420 | $2,080 | (32)% | | COVID-19 Diagnostics | $457 | $23,097 | (98)% | [Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20%28Unaudited%29) As of March 31, 2025, OraSure's total assets were $457.6 million, with cash at $247.6 million, and equity at $396.3 million Consolidated Balance Sheet | (in thousands) | March 31, 2025 (in thousands) | December 31, 2024 (in thousands) | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $247,569 | $267,763 | | Total current assets | $272,262 | $295,420 | | Total assets | $457,607 | $479,659 | | **Liabilities & Equity** | | | | Total current liabilities | $25,422 | $33,483 | | Total liabilities | $61,325 | $69,321 | | Stockholders' equity | $396,282 | $410,338 | | Total liabilities and stockholders' equity | $457,607 | $479,659 | [Consolidated Statement of Cash Flows](index=7&type=section&id=Consolidated%20Statement%20of%20Cash%20Flows%20%28Unaudited%29) In Q1 2025, OraSure used $19.7 million cash from operations, resulting in a net $20.2 million decrease in cash and equivalents Consolidated Statement of Cash Flows | (in thousands) | Q1 2025 (in thousands) | Q1 2024 (in thousands) | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | ($19,733) | $6,739 | | Net cash provided by (used in) investing activities | $370 | ($46,528) | | Net cash used in financing activities | ($953) | ($1,298) | | **Net decrease in cash and cash equivalents** | **($20,194)** | **($43,262)** | [Reconciliation of GAAP to Non-GAAP Financial Measures](index=10&type=section&id=Statement%20Regarding%20Use%20of%20Non-GAAP%20Financial%20Measures) OraSure reconciles Q1 2025 GAAP net loss of $16.0 million to a non-GAAP net loss of $13.1 million, with key adjustments Reconciliation of GAAP to Non-GAAP Measures | (in thousands) | Q1 2025 (in thousands) | Q1 2024 (in thousands) | | :--- | :--- | :--- | | **GAAP Operating Loss** | **($17,750)** | **($7,093)** | | Adjustments | $2,470 | $6,768 | | **Non-GAAP Operating Loss** | **($15,280)** | **($325)** | | **GAAP Net Loss** | **($16,040)** | **($3,584)** | | Adjustments | $2,901 | $6,670 | | **Non-GAAP Net (Loss) Income** | **($13,139)** | **$3,086** | - Major non-GAAP adjustments for Q1 2025 included stock compensation (**$2.7M**), gain on sale of assets (**$0.8M**), change in fair value of contingent consideration (**$0.5M**), and loss on equity investment (**$0.5M**)[24](index=24&type=chunk)

Core Insights - OraSure Technologies reported a 45% decrease in total net revenues for Q1 2025, amounting to $29.9 million compared to $54.1 million in Q1 2024, primarily due to a significant decline in COVID-19 related revenues [3][5][12] - The company is focused on expanding its product portfolio and enhancing customer relationships while navigating current market uncertainties [2][5] Financial Performance - Core business revenues, excluding COVID-19 and Molecular Services, decreased by 2% year-over-year to $29.5 million [5] - COVID-19 revenues plummeted by 98% to $0.5 million, down from $23.1 million in the previous year [3][12] - Gross profit for Q1 2025 was $12.3 million, a 49% decline from $24.1 million in Q1 2024, resulting in a gross margin of 41.1% compared to 44.5% [4][12] - The operating loss widened to $17.8 million in Q1 2025 from a loss of $7.1 million in Q1 2024, reflecting an operating margin of -59.3% [4][12] Business Developments - The company has authorized a $40 million stock repurchase program to enhance shareholder value [2][12] - Recent business activities include supporting Color Health with a cervical cancer risk screening test and renewing a customer agreement with Myriad Genetics [12] - OraSure has divested certain assets related to its Risk Assessment testing product line, with plans to exit this business in Q2 2025 [12] Financial Guidance - For Q2 2025, the company anticipates revenues between $28.5 million and $32.5 million, with core revenues expected to be between $28 million and $32 million [8]

Group 1 - OraSure Technologies (NASDAQ: OSUR) shares have declined from approximately $4 to below $3 since November 2024 [1] - The company is analyzed through a value investing lens, focusing on deep value plays and conservative discounted cash flow calculations [1] - The author emphasizes a concentrated investment strategy, inspired by renowned investors like Warren Buffett and Benjamin Graham [1] Group 2 - The author has a background in computer science and works as an IT project manager, which enhances their investment focus in the technology sector [1]

BETHLEHEM, Pa., April 23, 2025 (GLOBE NEWSWIRE) -- OraSure Technologies, Inc. (NASDAQ: OSUR) has scheduled its regular earnings conference call covering first quarter 2025 financial results and certain business developments for 5 p.m. ET on May 7, 2025. A webcast of the conference call will be available on the investor relations page of OraSure’s website at https://orasure.gcs-web.com/events-and-presentations. Please click on the webcast link and follow the prompts for registration and access at least 10 mi ...

Core Viewpoint - OraSure Technologies, Inc. has authorized a stock repurchase program of up to $40 million over the next twenty-four months, to be funded from cash on hand [1][2]. Company Overview - OraSure Technologies, Inc. is a leader in point-of-need and home diagnostic tests and sample management solutions, aiming to improve access, quality, and value of healthcare through innovative testing and sample management [3]. - The company, along with its subsidiaries DNA Genotek Inc. and Sherlock Biosciences, Inc., develops, manufactures, and distributes rapid diagnostic tests and sample collection devices globally [3]. Stock Repurchase Program - The stock repurchase may be executed through various methods in compliance with applicable laws, with the timing and amount determined at the management's discretion [2]. - The repurchase program can be modified, suspended, or discontinued at any time without prior notice [2].

FORM 10-K __________________________________________________________ (Mark One) x 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 Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 __________________________________________________________ | __________________________________________________________ Delaware | 36-4370966 | | --- | --- | | (State or other jurisdiction of | (I.R.S. Employ ...