CareDx(CDNA) - 2025 Q2 - Quarterly Results

Executive Summary Second Quarter 2025 Financial Highlights CareDx reported $90.5 million adjusted revenue, a 14% YoY increase, with 13% testing services volume growth and narrowed full-year guidance Q2 2025 Key Financial Highlights | Metric | Value | | :------------------------------------ | :------------------------------------ | | Adjusted Revenue | $90.5 million (+14% YoY) | | GAAP Testing Services Revenue | $62.0 million (-13% YoY) | | Adjusted Testing Services Revenue | $65.9 million (+14% YoY) | | Testing Services Volume | 49,500 (+13% YoY) | | GAAP Net Loss | $8.6 million (vs. $4.6 million in Q2 2024) | | Non-GAAP Net Income | $5.6 million (vs. $13.6 million in Q2 2024) | | Adjusted EBITDA Gain | $9.1 million (vs. loss of $0.3 million in Q2 2024) | | Cash, Cash Equivalents & Marketable Securities | $186 million (as of June 30, 2025) | | Full-Year 2025 Revenue Guidance | $367 million to $373 million (narrowed) | Recent Business Highlights CareDx achieved eight consecutive quarters of sequential testing volume growth and notable advancements in transplant care solutions - Eighth consecutive quarter of sequential growth in testing services volumes[4] - First Kidney Allograft Outcomes AlloSure Registry ("KOAR") manuscript published in The American Journal of Transplantation[4] - Draft LCD affirms surveillance testing coverage for solid organ transplant rejection[4] - Launched Increasing Organ Transplant Access ("IOTA") tool in XynQAPI®[4] - Leading presence with 40 abstracts and 12 oral presentations at 2025 World Transplant Congress[4] CEO Commentary CEO highlighted strong Q2 performance with accelerated AlloSure kidney testing volume and significant adjusted EBITDA improvement - Volume growth accelerated, led by AlloSure kidney testing, up nearly 20% year-over-year[5] - Improved cash collections and financial discipline contributed to a substantial adjusted EBITDA improvement[5] - Exceptional showing at the World Transplant Congress, highlighting AlloSure Kidney as the most significant biomarker for detecting organ rejection[5] - Launch of AlloSure Plus and differentiated products position CareDx as a leading in transplant care[5] Q2 2025 Detailed Financial Results Revenue Performance GAAP total revenue decreased 6% YoY to $86.7 million due to write-offs, while adjusted revenue increased 14% to $90.5 million Total Revenue Total Revenue (in millions) | Metric | Q2 2025 | Q2 2024 | YoY Change | | :-------------------- | :------ | :------ | :--------- | | GAAP Total Revenue | $86.7 | $92.3 | -6% | | Adjusted Total Revenue | $90.5 | $79.1 | +14% | | Revenue from tests performed in prior periods (Q2 2025) | $3.8 (reduction) | N/A | N/A | | Revenue from tests performed in prior periods (Q2 2024) | N/A | $13.2 (recognition) | N/A | Testing Services Revenue Testing Services Revenue (in millions) | Metric | Q2 2025 | Q2 2024 | YoY Change | | :---------------------------- | :------ | :------ | :--------- | | GAAP Testing Services Revenue | $62.0 | $70.9 | -13% | | Adjusted Testing Services Revenue | $65.9 | $57.7 | +14% | | Testing Services Volume | 49,500 | N/A | +13% | | AlloSure Kidney Testing Volumes | N/A | N/A | Nearly +20% | Patient and Digital Solutions & Product Revenue Other Revenue Streams (in millions) | Metric | Q2 2025 | Q2 2024 | YoY Change | | :-------------------------------- | :------ | :------ | :--------- | | Patient and Digital Solutions Revenue | $12.8 | $10.7 | +19% | | Product Revenue | $11.8 | $10.6 | +12% | Profitability GAAP net loss increased to $8.6 million, non-GAAP net income decreased, but adjusted EBITDA showed a $9.1 million gain GAAP Net Loss GAAP Net Loss (in millions) | Metric | Q2 2025 | Q2 2024 | | :------------------------------------ | :------ | :------ | | GAAP Net Loss | $(8.6) | $(4.6) | | GAAP Net Loss Per Share (Basic & Diluted) | $(0.16) | $(0.09) | Non-GAAP Net Income and Adjusted EBITDA Non-GAAP Profitability (in millions) | Metric | Q2 2025 | Q2 2024 | | :------------------------------------------ | :------ | :------ | | Non-GAAP Net Income | $5.6 | $13.6 | | Non-GAAP Diluted Net Income Per Share | $0.10 | $0.25 | | Adjusted EBITDA Gain (excluding prior period revenue) | $9.1 | $(0.3) (loss) | 2025 Financial Guidance Full Year 2025 Outlook CareDx narrowed its full-year 2025 revenue guidance to $367-$373 million and maintained adjusted EBITDA guidance Full Year 2025 Guidance (in millions) | Metric | New Guidance | Previous Guidance | | :-------------------- | :------------- | :---------------- | | Revenue | $367 to $373 | $365 to $375 | | Adjusted EBITDA | $29 to $33 | $29 to $33 | About CareDx – The Transplant Company Company Overview CareDx is a leading precision medicine company providing genomics-based healthcare solutions for transplant patients and caregivers - CareDx is a leading precision medicine company focused on discovery, development, and commercialization of high-value healthcare solutions for transplant patients and caregivers[11] - Offers testing services, products, and digital healthcare solutions along the pre- and post-transplant patient journey[11] - Leading provider of genomics-based information for transplant patients[11] Forward-Looking Statements Disclaimer and Key Information Forward-looking statements outline 2025 goals, noting potential material differences due to risks and uncertainties, with no obligation to update - Forward-looking statements are based on currently available information and expectations for 2025[12] - Actual results may differ materially and adversely due to numerous unpredictable risks and uncertainties, including general economic and market factors[13] - CareDx expressly disclaims any obligation to update or revise these statements, except as required by law[13] - Recent developments mentioned include the launch of AlloSure® Plus, an AI-driven diagnostic platform, and the initiation of multiple customer pilots for the EPIC environment[12] Use of Non-GAAP Financial Measures Explanation and Definitions CareDx uses non-GAAP measures like adjusted revenue, net income, and EBITDA to provide insights into core business performance, not as GAAP substitutes - Non-GAAP financial measures are presented to assist investors in assessing operating results through management's eyes and for comparing core business performance[16] - Non-GAAP net income (loss) excludes stock-based compensation, acquisition-related amortization, litigation settlement expense, transformational initiative costs, and other charges[15] - Adjusted revenue excludes the impact of revenue from tests performed in prior periods[15] - Adjusted EBITDA is defined as non-GAAP net income (loss) before interest income, income tax, depreciation, other (income) expense, net, and revenue from tests performed in prior periods[15] - Non-GAAP measures are not meant to be considered superior to or a substitute for financial measures calculated in accordance with GAAP[14] GAAP to Non-GAAP Reconciliations Detailed reconciliations between GAAP and non-GAAP financial measures are provided for key line items for Q2 2025 and 2024 Cost of Sales and Operating Expenses Reconciliation Q2 2025 GAAP to Non-GAAP Cost of Sales and Operating Expenses (in thousands) | Metric | GAAP | Non-GAAP | Key Adjustments (e.g., Stock-based comp) | | :------------------------------------ | :----- | :------- | :----------------------------------- | | Cost of testing services | $15,406 | $14,731 | $(329) | | Cost of product | $4,981 | $4,267 | $(108) | | Cost of patient and digital solutions | $8,271 | $7,755 | $(189) | | Research and development expenses | $16,830 | $15,423 | $(1,407) | | Sales and marketing expenses | $24,279 | $21,497 | $(2,146) | | General and administrative expenses | $28,033 | $19,828 | $(5,245) | | Total GAAP operating expenses | $69,142 | N/A | N/A | | Total Non-GAAP operating expenses | N/A | $56,748 | N/A | Gross Profit and Gross Margin Reconciliation Q2 2025 GAAP to Non-GAAP Gross Profit and Gross Margin (in thousands, except percentages) | Metric | Q2 2025 | Q2 2024 | | :------------------------------------ | :------ | :------ | | GAAP Gross Profit | $58,021 | $64,275 | | GAAP Gross Margin % | 67% | 70% | | Non-GAAP Gross Profit | $59,926 | $66,238 | | Non-GAAP Gross Margin % | 69% | 72% | | Q2 2025 Adjustments: Stock-based compensation expense | $626 | N/A | | Q2 2025 Adjustments: Restructuring costs | $338 | N/A | | Q2 2025 Adjustments: Acquisition related-amortization | $941 | N/A | Adjusted Revenue Reconciliations Q2 2025 GAAP to Non-GAAP Adjusted Revenue (in thousands) | Metric | Q2 2025 | Q2 2024 | | :------------------------------------ | :------ | :------ | | GAAP Total Revenue | $86,679 | $92,274 | | Revenue from tests performed in prior periods (Q2 2025) | $3,827 (reduction) | N/A | | Revenue from tests performed in prior periods (Q2 2024) | N/A | $(13,214) (recognition) | | Adjusted Total Revenue (Non-GAAP) | $90,506 | $79,060 | | GAAP Testing Services Revenue | $62,033 | $70,918 | | Adjusted Testing Services Revenue (Non-GAAP) | $65,860 | $57,704 | Net Income and EPS Reconciliation Q2 2025 GAAP to Non-GAAP Net Income and EPS (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | | :------------------------------------ | :------ | :------ | | GAAP Net Loss | $(8,568) | $(4,623) | | Stock-based compensation expense | $9,424 | $16,399 | | Acquisition related-amortization of purchased intangibles | $1,589 | $1,606 | | Transformational initiative costs | $1,871 | $0 | | Non-GAAP Net Income | $5,622 | $13,611 | | GAAP Basic and Diluted Net Loss Per Share | $(0.16) | $(0.09) | | Non-GAAP Basic Net Income Per Share | $0.10 | $0.26 | | Non-GAAP Diluted Net Income Per Share | $0.10 | $0.25 | Adjusted EBITDA Reconciliation Q2 2025 Non-GAAP to Adjusted EBITDA (in thousands) | Metric | Q2 2025 | Q2 2024 | | :------------------------------------------ | :------ | :------ | | Non-GAAP Net Income | $5,622 | $13,611 | | Interest income | $(2,364) | $(2,826) | | Income tax (benefit) expense | $(8) | $121 | | Depreciation expense | $2,132 | $1,937 | | Other (income) expense, net | $(72) | $100 | | Adjusted EBITDA (before prior period revenue) | $5,310 | $12,943 | | Revenue from tests performed in prior periods | $3,827 | $(13,214) | | Adjusted EBITDA (after prior period revenue) | $9,137 | $(271) | Condensed Consolidated Financial Statements Condensed Consolidated Statements of Operations Unaudited consolidated statements of operations show total revenue decreased to $86.7 million, resulting in an $8.6 million net loss in Q2 2025 Condensed Consolidated Statements of Operations (Three Months Ended June 30, in thousands) | Metric | 2025 | 2024 | | :---------------------------------- | :----- | :----- | | Testing services revenue | $62,033 | $70,918 | | Product revenue | $11,833 | $10,610 | | Patient and digital solutions revenue | $12,813 | $10,746 | | Total revenue | $86,679 | $92,274 | | Total operating expenses | $97,800 | $99,601 | | Loss from operations | $(11,121) | $(7,327) | | Net loss | $(8,568) | $(4,623) | | Basic and Diluted Net loss per share | $(0.16) | $(0.09) | Condensed Consolidated Balance Sheets Unaudited consolidated balance sheets show total assets decreased to $444.3 million, driven by reduced cash and marketable securities Condensed Consolidated Balance Sheets (As of, in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :---------------- | | Cash and cash equivalents | $68,212 | $114,689 | | Marketable securities | $118,043 | $145,964 | | Total current assets | $307,296 | $351,832 | | Total assets | $444,257 | $491,050 | | Total current liabilities | $93,180 | $89,371 | | Total liabilities | $116,887 | $112,617 | | Total stockholders' equity | $327,370 | $378,433 | Contact Information Media and Investor Relations This section provides contact details for CareDx's Media Relations and Investor Relations departments - Media Relations Contact: Natasha Wagner (nwagner@CareDx.com)[34] - Investor Relations Contact: Caroline Corner (investor@CareDx.com)[34]