Exact Sciences(EXAS) - 2025 Q2 - Quarterly Results

Second Quarter 2025 Financial & Operational Highlights Exact Sciences reported record Q2 2025 revenue of $811 million, a 16% year-over-year increase, driven by strong growth in Screening and Precision Oncology, significantly reducing net loss to $1 million and boosting adjusted EBITDA by 26% to $138 million, alongside key operational advancements Q2 2025 Financial Performance vs. Q2 2024 | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | Change (Millions) | % Change | | :--- | :--- | :--- | :--- | :--- | | Total Revenue | $811 million | $699 million | +$112 million | +16% | | Screening Revenue | $628 million | - | - | +18% | | Precision Oncology Revenue | $183 million | - | - | +9% | | Net Loss | ($1 million) | ($16 million) | +$15 million | -94% | | Net Loss per Share | ($0.01) | ($0.09) | +$0.08 | -89% | | Adjusted EBITDA | $138 million | $110 million | +$28 million | +26% | | Operating Cash Flow | $89 million | - | - | - | | Free Cash Flow | $47 million | - | - | - | - The company raised its full-year 2025 revenue guidance midpoint by $55 million and its adjusted EBITDA guidance midpoint by $25 million[4] - Strategic initiatives in the quarter included an exclusive license agreement with Freenome for blood-based colorectal cancer screening tests and gaining Medicare coverage for the Oncodetect™ molecular residual disease test[4] - A multi-year productivity plan was announced, targeting $150 million in annual savings by 2026[4] Platform and Pipeline Advancements The company advanced its product pipeline with the April 2025 launch of the Oncodetect™ test, which gained Medicare coverage for colorectal cancer patients, and plans to launch the Cancerguard™ multi-cancer screening test in September 2025, alongside an exclusive licensing agreement with Freenome for blood-based colorectal cancer screening - Launched the Oncodetect™ test in April 2025 for molecular residual disease (MRD) and recurrence monitoring, which recently received Medicare coverage for stage II, III, and resectable stage IV colorectal cancer (CRC) patients[6] - Plans to launch the Cancerguard™ multi-cancer screening test as a laboratory-developed test in September 2025[7] - In August 2025, acquired exclusive rights to Freenome's current and future blood-based colorectal cancer screening tests and underlying technology[7] 2025 Outlook Exact Sciences raised its full-year 2025 guidance, now expecting total revenue between $3.13 billion and $3.17 billion, representing 14% year-over-year growth at the midpoint, and adjusted EBITDA between $455 million and $475 million, a 44% increase at the midpoint Updated Full-Year 2025 Guidance | Metric | Prior Guidance (Billions/Millions) | August 6 Update (Billions/Millions) | Change at Midpoint (Millions) | Y/Y Growth Rate | | :--- | :--- | :--- | :--- | :--- | | Total Revenue | $3.070 - $3.120 billion | $3.130 - $3.170 billion | +$55.0 million | 14% | | Screening Revenue | $2.390 - $2.425 billion | $2.440 - $2.470 billion | +$47.5 million | 17% | | Precision Oncology Revenue | $680 - $695 million | $690 - $700 million | +$7.5 million | 6% | | Adjusted EBITDA | $425 - $455 million | $455 - $475 million | +$25.0 million | 44% | Product Portfolio Overview The company's portfolio encompasses leading non-invasive screening tests like Cologuard® and Cologuard Plus™, advanced diagnostic tests such as Oncotype DX® and Oncodetect™ for therapy selection and recurrence monitoring, comprehensive genetic testing services via PreventionGenetics, and the upcoming Cancerguard™ multi-cancer screening test in its pipeline - Cologuard® and Cologuard Plus™: Non-invasive, stool-based colorectal cancer (CRC) screening tests for adults 45+, with the new Cologuard Plus test, launched in Q1 2025, expected to reduce false positives by nearly 40%[16][18] - Oncodetect™: A tumor-informed molecular residual disease (MRD) test that detects circulating tumor DNA (ctDNA) in the blood to guide therapy decisions and monitor for cancer recurrence[19] - Cancerguard™: A multi-cancer early detection test in development, designed to detect multiple cancers from a single blood draw with high specificity[20][21] - Precision Oncology Portfolio: Includes the Oncotype DX Breast Recurrence Score® test, a standard of care for predicting chemotherapy benefit, and the OncoExTra® test for comprehensive tumor profiling to aid therapy selection in advanced cancers[22] - PreventionGenetics: An acquired CLIA-accredited laboratory providing clinical genetic testing for nearly all clinically relevant genes, including whole genome and exome sequencing[23] Financial Statements The unaudited financial statements for the three and six months ended June 30, 2025, detail a significant reduction in net loss, a stable asset base with total equity of $2.47 billion, and positive operating and free cash flow for the quarter Condensed Consolidated Statements of Operations For the three months ended June 30, 2025, revenue increased to $811.1 million, gross profit grew to $562.5 million, and the company significantly narrowed its loss from operations to $2.1 million, resulting in a net loss of just $1.2 million Q2 2025 vs Q2 2024 Statement of Operations (in thousands) | Line Item | Three Months Ended June 30, 2025 (Thousands) | Three Months Ended June 30, 2024 (Thousands) | | :--- | :--- | :--- | | Revenue | $811,085 | $699,264 | | Gross Profit | $562,453 | $488,316 | | Total Operating Expenses | $564,601 | $518,373 | | Loss from Operations | $(2,148) | $(26,257) | | Net Loss | $(1,185) | $(15,808) | | Net Loss per Share | $(0.01) | $(0.09) | Condensed Consolidated Balance Sheets As of June 30, 2025, the company held $858.4 million in cash and marketable securities, with total assets at $5.80 billion, total liabilities at $3.33 billion, and total stockholders' equity increasing to $2.47 billion Balance Sheet Highlights (in thousands) | Account | June 30, 2025 (Thousands) | December 31, 2024 (Thousands) | | :--- | :--- | :--- | | Cash and cash equivalents | $657,099 | $600,889 | | Marketable securities | $201,336 | $437,137 | | Total Assets | $5,797,365 | $5,928,139 | | Total Liabilities | $3,327,951 | $3,525,890 | | Total Stockholders' Equity | $2,469,414 | $2,402,249 | Cash Flow Statement For Q2 2025, net cash provided by operating activities was $89.0 million, resulting in positive free cash flow of $46.7 million after capital expenditures, a decrease from $71.2 million in the prior year period Cash Flow Summary (in thousands) | Metric | Three Months Ended June 30, 2025 (Thousands) | Three Months Ended June 30, 2024 (Thousands) | | :--- | :--- | :--- | | Net cash provided by operating activities | $89,017 | $107,065 | | Purchases of property, plant and equipment | $(42,342) | $(35,866) | | Free Cash Flow | $46,675 | $71,199 | Non-GAAP Financial Measures & Reconciliations The company provides non-GAAP measures like Core Revenue and Adjusted EBITDA for supplemental performance insights, with Q2 2025 core revenue growth at 16% and Adjusted EBITDA increasing 26% to $138.2 million, alongside detailed reconciliations for various adjustments Core Revenue Reconciliation The core revenue reconciliation, adjusting for divestitures and foreign currency impacts, shows Q2 2025 total core revenue of $807.8 million, representing 16% year-over-year growth consistent with reported GAAP revenue Q2 2025 Core Revenue Reconciliation (in thousands) | Segment | GAAP Revenue (Thousands) | Non-GAAP 2024 Base (Thousands) | Foreign Currency Impact (Thousands) | Core Revenue (Thousands) | Core % Change | | :--- | :--- | :--- | :--- | :--- | :--- | | Screening | $628,481 | $531,606 | $0 | $628,481 | 18% | | Precision Oncology | $182,604 | $165,111 | $(3,278) | $179,326 | 9% | | Total | $811,085 | $696,717 | $(3,278) | $807,807 | 16% | Adjusted EBITDA Reconciliation Adjusted EBITDA for Q2 2025 was $138.2 million, an increase from $110.1 million in Q2 2024, with the reconciliation from net loss of $1.2 million including major adjustments for stock-based compensation, depreciation, amortization, and restructuring costs Q2 2025 Adjusted EBITDA Reconciliation (in thousands) | Line Item | Amount (Thousands) | | :--- | :--- | | Net loss | $(1,185) | | Interest, Tax, Depreciation & Amortization | $65,118 | | Stock-based compensation | $64,939 | | Acquisition and integration costs | $4,910 | | Restructuring and business transformation | $15,240 | | Other adjustments | $(11,926) | | Adjusted EBITDA | $138,224 | Forward-Looking Statements This section contains standard safe harbor language, cautioning investors that forward-looking statements regarding future operating results, product development, and strategic initiatives are subject to material risks and uncertainties, directing readers to SEC filings for detailed risk discussions - The report contains forward-looking statements about future operating results, product launches (new or improved), commercialization efforts, and benefits from acquisitions and licensing deals[25] - Investors are cautioned not to place undue reliance on these statements as they are subject to known and unknown risks, including market acceptance of products, competition, reimbursement rates, and regulatory changes[25][26] - A comprehensive list of risks is available in the Risk Factors sections of the company's Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q[27]