GeneDx (US:WGS)2025-07-29 12:18Financial Performance - Total revenue for the three months ended June 30, 2025, was $102.692 million, a 45.5% increase from $70.514 million in the same period of 2024[14] - Diagnostic test revenue reached $99.823 million for the three months ended June 30, 2025, compared to $69.439 million in the prior year, reflecting a 43.9% growth[14] - Gross profit for the six months ended June 30, 2025, was $129.378 million, up from $80.363 million in 2024, indicating a 60.9% increase[14] - The company reported a net income of $10.809 million for the three months ended June 30, 2025, compared to a net loss of $29.173 million in the same quarter of 2024[14] - Net income for the six months ended June 30, 2025, was $4,280,000, a significant improvement compared to a net loss of $49,412,000 for the same period in 2024[19] - Pro forma revenues for the three months ended June 30, 2025, were $103.2 million, compared to $72.1 million for the same period in 2024, reflecting a significant increase[49] - Pro forma net income for the three months ended June 30, 2025, was $11.1 million, a recovery from a net loss of $31.4 million in the same period of 2024[49] - Net income attributable to common stockholders for Q2 2025 was $10.8 million, compared to a loss of $29.2 million in Q2 2024, resulting in basic earnings per share of $0.38 versus a loss of $1.10[13] Expenses and Investments - Research and development expenses for the three months ended June 30, 2025, were $15.079 million, an increase from $10.902 million in 2024, representing a 38.1% rise[14] - Stock-based compensation expense for the six months ended June 30, 2025, was $11,796,000, compared to $2,657,000 for the same period in 2024[19] - The Company recorded $2.3 million and $4.5 million in depreciation and amortization expenses for the three and six months ended June 30, 2025, respectively[75][76] - The Company incurred $1.7 million and $4.2 million in purchases from Twist Biosciences for the three and six months ended June 30, 2025, respectively[79] - The Company recorded a depreciation and amortization expense of $11,869,000 for the six months ended June 30, 2025, compared to $10,466,000 in 2024[19] Assets and Equity - Total assets as of June 30, 2025, amounted to $463.863 million, up from $419.380 million at the end of 2024, showing a 10.6% increase[13] - Total stockholders' equity increased to $277.133 million as of June 30, 2025, compared to $245.247 million at the end of 2024, reflecting a 13.0% growth[13] - Cash, cash equivalents, and restricted cash at the end of the period were $75,110,000, an increase from $57,063,000 at the end of June 2024[19] - Cash and cash equivalents as of June 30, 2025, totaled $74.1 million, down from $85.2 million as of December 31, 2024[116] - Total cash, cash equivalents, and restricted cash amounted to $135.5 million as of June 30, 2025, compared to $142.2 million as of December 31, 2024[190] Acquisitions and Strategic Direction - The company plans to pursue a new strategic direction, including exiting certain business segments, which is expected to impact gross margins positively[11] - The acquisition of Fabric Genomics is anticipated to provide expected benefits, although specific financial impacts were not detailed[11] - The company acquired Fabric Genomics on May 5, 2025, enhancing its capabilities in genomics and diagnostics[22] - The Company completed the acquisition of Fabric Genomics for approximately $33.5 million, enhancing its AI capabilities in Next Generation Sequencing analysis[41] - The Company agreed to pay up to $10.5 million in contingent consideration based on Fabric Genomics achieving gross revenue of at least $6.0 million and a gross margin of at least 69% for the fiscal year ending December 31, 2025[67] Liabilities and Debt - The total financial liabilities as of June 30, 2025, were $5.828 million, an increase from $3.519 million as of December 31, 2024[57][58] - As of June 30, 2025, the total long-term debt, net of current portion, was $51.7 million, with scheduled maturities including $51.3 million due in 2028[80] - The Company entered into a Credit Agreement with Perceptive Credit Holdings IV, LP, providing a senior secured delayed draw term loan facility of up to $75.0 million, with an initial tranche of $50.0 million funded on October 27, 2023[71][81] - The Perceptive Term Loan Facility has a maturity date of October 27, 2028, with an interest rate of Term SOFR plus an applicable margin of 7.5%[83] Stock and Equity Compensation - The balance of common stock increased to 28,708,058 shares as of June 30, 2025, from 28,530,337 shares at March 31, 2025[16] - The Company issued 645,414 shares of Class A common stock to Perceptive in satisfaction of a cashless exercise of Initial Warrant Shares at an aggregate exercise price of $2.5 million[72][87] - The Company issued 150,000 shares of Class A common stock in the ATM offering during the first half of 2025, raising $13.8 million at an average price of $96.10 per share[118] - The Company recorded an aggregate reversal of stock-based compensation of $0.8 million during the six months ended June 30, 2025, due to forfeiture activities upon employee terminations[98] - The total fair value of restricted stock units vested during the six months ended June 30, 2025, was $7.1 million, with unrecognized stock-based compensation expense related to restricted stock units amounting to $41.1 million[108] Tax and Regulatory Matters - The effective tax rate for the three months ended June 30, 2025, was (2.3%), while for the six months it was 4.5%, compared to 0.6% and 0.5% for the same periods in 2024[112] - The Company is assessing the impact of the One Big Beautiful Bill Act (OBBBA) on its consolidated financial statements, which is expected to be reflected in the third fiscal quarter of 2025[114] Segment Performance - Total revenue for the GeneDx operating segment in Q2 2025 was $101.8 million, a significant increase from $68.9 million in Q2 2024, representing a growth of approximately 47.6%[121] - Adjusted gross profit for the GeneDx segment in Q2 2025 was $71.8 million, up from $42.4 million in Q2 2024, reflecting an increase of about 69.2%[121] - The GeneDx segment is the only reportable segment, focusing on pediatric and rare disease diagnostics, primarily through whole exome and genome sequencing[119] Cash Flow and Reserves - Cash provided by operating activities for the six months ended June 30, 2025, was $20,602,000, compared to cash used in operating activities of $20,918,000 for the same period in 2024[19] - The company experienced a net cash used in investing activities of $45,758,000 for the six months ended June 30, 2025[19] - As of June 30, 2025, the company's third-party payor reserves amounted to $17.6 million, up from $12.6 million as of December 31, 2024[56] - The fair value of total financial assets as of June 30, 2025, was $123.104 million, compared to $114.576 million as of December 31, 2024, reflecting an increase of approximately 7.5%[57][58]