Veracyte(US:VCYT)2019-10-22 20:30Revenue and Growth - Revenue for Q3 2019 was $31.0 million, a 32% increase year-over-year; excluding biopharmaceutical services revenue, revenue was $26.7 million, a 15% increase [105]. - Revenue for the three months ended September 30, 2019, increased by $7.5 million, or 32%, compared to the same period in 2018, primarily due to a $4.3 million increase in biopharmaceutical service revenue and a 24% volume increase in genomic classifiers [139]. - Revenue increased by $24.4 million, or 37%, for the nine months ended September 30, 2019, primarily due to a 28% volume increase in genomic classifiers [140]. Gross Margin and Expenses - Gross margin for Q3 2019 was 71%, an increase of six percentage points; excluding biopharmaceutical services revenue, gross margin was 66%, an increase of two percentage points [105]. - Total operating expenses for the three months ended September 30, 2019, were $32.7 million, an increase of 18% compared to $27.8 million in the same period of 2018 [138]. - Research and development expenses for the three months ended September 30, 2019, were $3.6 million, a 7% increase from $3.4 million in the same period of 2018 [138]. - Selling and marketing expenses increased by 30% to $13.1 million for the three months ended September 30, 2019, compared to $10.1 million in the same period of 2018 [138]. - General and administrative expense increased by $3.1 million, or 18%, for the nine months ended September 30, 2019, mainly due to higher stock-based compensation [150]. Test Volume and Product Development - Total genomic test volume grew to 9,941 in Q3 2019, a 24% increase compared to Q3 2018 [108]. - Percepta Genomic Sequencing Classifier volume increased to 793 tests, a 112% increase compared to Q3 2018 [108]. - Afirma test volume grew to 8,925 tests, a 17% increase compared to the same quarter last year [108]. - The company has commercialized seven genomic tests addressing a $2 billion global market opportunity [101]. - The company has expanded its product portfolio with innovations in genomic science and machine learning methodologies to improve patient care [120]. Financial Position and Cash Flow - Cash and cash equivalents were $195.7 million as of September 30, 2019 [105]. - Cash used in operating activities for the nine months ended September 30, 2019 was $5.0 million, a decrease from $12.3 million in the same period of 2018 [164][166]. - Cash provided by financing activities for the nine months ended September 30, 2019 was $124.3 million, significantly higher than $57.7 million in the same period of 2018 [168][169]. - As of September 30, 2019, the company had cash and cash equivalents of $195.7 million, which is expected to meet anticipated cash requirements for at least the next 12 months [155]. Losses and Improvements - Net loss for Q3 2019 was $0.7 million, an improvement of 84% year-over-year [105]. - The company reported a net loss of $730,000 for the three months ended September 30, 2019, a significant improvement compared to a net loss of $4.5 million in the same period of 2018, reflecting a 84% reduction in losses [138]. - The company incurred a net loss of $5.1 million for the nine months ended September 30, 2019, with an accumulated deficit of $239.2 million [154]. - The company reported a net loss of $5.1 million for the nine months ended September 30, 2019, which included non-cash charges of $7.0 million for stock-based compensation [165]. Interest and Debt Management - Interest expense decreased by $831,000, or 58%, for the nine months ended September 30, 2019, due to prepayments of $12.5 million and $12.4 million of the Term Loan Advance [152]. - The average Term Loan Advance interest rate was 6.94% for the nine months ended September 30, 2019, compared to 6.03% for the same period in 2018 [152]. - As of September 30, 2019, the principal balance outstanding under the Loan and Security Agreement was $0.1 million, with compliance to debt covenants [160]. - Future principal payments due under the Loan and Security Agreement are limited to $1.3 million in 2022 [170].