Guardant Health(US:GH)2025-07-30 21:13PART I Unaudited Condensed Consolidated Financial Statements Guardant Health's unaudited financial statements for H1 2025 show a 26% revenue increase, a narrowed net loss, and a widening stockholders' deficit Condensed Consolidated Balance Sheets Total assets decreased to $1.33 billion as of June 30, 2025, with liabilities slightly up and stockholders' deficit widening to $305.5 million Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $629,143 | $525,540 | | Short-term marketable debt securities | $0 | $314,438 | | Total current assets | $883,432 | $1,055,114 | | Total Assets | $1,331,999 | $1,485,609 | | Liabilities & Stockholders' Deficit | | | | Total current liabilities | $238,430 | $225,583 | | Convertible senior notes, net | $1,115,526 | $1,142,547 | | Total Liabilities | $1,637,474 | $1,625,256 | | Total Stockholders' Deficit | $(305,475) | $(139,647) | Condensed Consolidated Statements of Operations Q2 2025 revenue grew 31% to $232.1 million with a net loss of $99.9 million, while H1 2025 revenue increased 26% to $435.6 million with a narrowed net loss Statement of Operations Summary (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | Revenue | $232,088 | $177,235 | $435,559 | $345,726 | | Loss from operations | $(106,413) | $(100,618) | $(217,454) | $(200,301) | | Net loss | $(99,899) | $(102,628) | $(195,058) | $(217,613) | | Net loss per share | $(0.80) | $(0.84) | $(1.57) | $(1.78) | - Operating expenses increased across all categories, with sales and marketing showing the largest percentage increase (46% YoY for the quarter) to support the Shield product launch15199 Condensed Consolidated Statements of Cash Flows Net cash used in operating activities improved to $123.0 million for H1 2025, with investing activities providing $292.2 million, resulting in a $105.7 million increase in total cash Cash Flow Summary for Six Months Ended June 30 (in thousands) | Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(122,974) | $(124,286) | | Net cash provided by investing activities | $292,215 | $22,989 | | Net cash (used in) provided by financing activities | $(65,226) | $4,824 | | Net increase (decrease) in cash | $105,725 | $(98,448) | - Financing activities in H1 2025 included a $45.0 million repurchase of treasury stock and $12.3 million in debt issuance costs, which were not present in H1 202428229 Notes to the Unaudited Condensed Consolidated Financial Statements Key notes detail the FDA approval and launch of the Shield blood test, a $659.3 million note exchange yielding a $13.7 million gain, and ongoing significant legal proceedings - The Shield blood test for colorectal cancer screening received FDA approval in July 2024, became commercially available in August 2024, and was included in NCCN screening guidelines in June 202532 Revenue Disaggregation (in thousands) | Revenue Source | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | Oncology | $158,685 | $130,269 | $309,244 | $256,017 | | Biopharma and data | $56,020 | $43,933 | $101,396 | $81,520 | | Screening | $14,814 | $0 | $20,491 | $0 | | Licensing and other | $2,569 | $3,033 | $4,428 | $8,189 | | Total revenue | $232,088 | $177,235 | $435,559 | $345,726 | - In February 2025, the company exchanged $659.3 million of its 2027 Notes for $600.0 million of new 1.25% Convertible Senior Notes due 2031, recognizing a $13.7 million gain on extinguishment99 - A jury awarded the company $292.5 million (affirmed at $287.0 million) in its false advertising lawsuit against Natera. The company is also defending against patent infringement claims from TwinStrand, Tempus, and CSHL122123126 Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses Q2 2025 financial performance, noting a 31% revenue increase to $232.1 million, rising operating expenses, a $99.9 million net loss, and sufficient liquidity for over 12 months Results of Operations Q2 2025 total revenue increased 31% to $232.1 million, driven by growth across all segments, while operating expenses rose 22%, and H1 2025 net loss narrowed due to a debt extinguishment gain Quarterly Revenue Comparison (in thousands) | Revenue Source | Q2 2025 | Q2 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Oncology | $158,685 | $130,269 | $28,416 | 22% | | Biopharma and data | $56,020 | $43,933 | $12,087 | 28% | | Screening | $14,814 | $0 | $14,814 | N/A | | Total revenue | $232,088 | $177,235 | $54,853 | 31% | - Oncology test volume increased to approximately 64,000 in Q2 2025 from 49,400 in Q2 2024194 Quarterly Operating Expense Comparison (in thousands) | Expense Category | Q2 2025 | Q2 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Cost of revenue | $81,205 | $72,421 | $8,784 | 12% | | Research and development | $87,449 | $83,102 | $4,347 | 5% | | Sales and marketing | $119,588 | $81,867 | $37,721 | 46% | | General and administrative | $50,259 | $40,463 | $9,796 | 24% | - Other income (expense), net, was a $7.8 million income for H1 2025, primarily due to a $13.7 million gain on debt extinguishment, compared to a $44.3 million expense in H1 2024 which was driven by unrealized losses on an equity investment217 Liquidity and Capital Resources As of June 30, 2025, the company held $735.5 million in cash, with management deeming it sufficient for over 12 months of operations despite a $2.8 billion accumulated deficit - The company has an accumulated deficit of $2.8 billion as of June 30, 2025219 - Cash, cash equivalents and restricted cash totaled $735.5 million as of June 30, 2025220 - In August 2024, the company established an at-the-market (ATM) offering program to sell up to $400.0 million of common stock, but no shares have been sold as of June 30, 2025223 Quantitative and Qualitative Disclosures About Market Risk The company faces market risks from interest rate changes on its $735.5 million portfolio and foreign currency fluctuations, though management deems their impact immaterial - Primary market risks are interest rate risk on its $735.5 million cash and investment portfolio and foreign currency risk from international expansion235236 - A hypothetical 100 basis point change in interest rates would have an immaterial impact on the fair value of investments235 Controls and Procedures Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting - The Co-CEOs and CFO concluded that disclosure controls and procedures were effective as of June 30, 2025237 - No material changes in internal control over financial reporting occurred during the quarter238 PART II – OTHER INFORMATION Legal Proceedings This section incorporates by reference detailed legal proceedings from Note 8, including ongoing patent litigation and a significant false advertising verdict - Information regarding legal proceedings is incorporated by reference from Note 8 to the condensed consolidated financial statements240 Risk Factors No material changes occurred to the company's previously disclosed risk factors during Q2 2025, with investors referred to the Annual Report on Form 10-K - There were no material changes to the company's previously disclosed risk factors during the second quarter of fiscal 2025241 Other Information No directors or officers adopted or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the quarter ended June 30, 2025 - No directors or officers adopted or terminated a Rule 10b5-1 trading arrangement during the quarter ended June 30, 2025246