bioAffinity Technologies(BIAF) - 2025 Q2 - Quarterly Results

Executive Summary bioAffinity Technologies achieved significant Q2 2025 growth in CyPath Lung revenues and test volumes, alongside strategic milestones in product utility, pricing, logistics, capital raising, leadership, and intellectual property expansion Q2 2025 Performance Overview bioAffinity Technologies reported significant growth in its CyPath Lung diagnostic product, with revenues increasing 62% year-over-year for the first six months of 2025, and test volumes also seeing a substantial rise, indicating growing clinical adoption - CyPath Lung revenues increased 62% year-over-year for the six-month period ended June 30, 2025[3] - Completed CyPath Lung tests in July represented a 72% increase over the previous monthly average for the first six months of 2025, including back-to-back record monthly sales in June and July[3] Strategic and Operational Achievements The company achieved several strategic milestones, including demonstrating CyPath Lung's diagnostic utility through real-world case studies, increasing its list price, expanding logistics, completing a public offering, strengthening its leadership team, and expanding its global intellectual property portfolio - Released real-world case studies demonstrating the diagnostic utility of CyPath Lung, including successful detection of Stage 1A lung cancers[3] - Increased the list price of CyPath Lung to $2,900, aligning with private payer reimbursement strategies[3] - Expanded logistics capabilities through partnership with Cardinal Health™ OptiFreight Logistics, improving sample tracking and national delivery reliability[3] - Completed a $3.25 million public offering in May 2025 to provide working capital[3] - Appointed Dr. Gordon Downie, MD, PhD, as Chief Medical Officer, bringing over 30 years of clinical leadership[3] - Announced patent grants in the U.S., China, Canada, and Australia, expanding the global intellectual property portfolio for diagnostics and therapeutics[3] - Presented novel siRNA-based cancer therapy research at the 2025 RNA Therapeutics Conference[3] - President and CEO Maria Zannes appointed to the American Lung Association in Texas Leadership Board[3] Management Discussion and Outlook Management commentary emphasizes the accelerated commercialization of CyPath Lung, strategic market expansion, strengthened financial and leadership foundations, and continued focus on product access and future innovation CEO Commentary CEO Maria Zannes highlighted the acceleration of CyPath Lung's commercialization, driven by increasing clinical adoption and validating real-world case studies, emphasizing the success of the Texas pilot marketing program, plans for expansion into new markets, and strategic steps taken to strengthen the financial foundation, leadership, and intellectual property, with a continued focus on expanding access, operational efficiency, and advancing next-generation diagnostics and therapeutics - Q2 results reflect continued acceleration of CyPath Lung commercialization strategy, with testing revenue up 62% for the first half of the year, driven by increasing clinical adoption and physician-authored case studies[4] - The pilot marketing program in Texas demonstrated a sound and effective approach, preparing the company for expansion into additional key markets, including the Mid-Atlantic region and the Veterans Administration healthcare system[5] - Important steps were taken to strengthen the financial foundation, including a $3.25 million public offering and a strategic price adjustment for CyPath Lung, alongside enhanced national sample delivery capabilities through Cardinal Health OptiFreight® Logistics[6] - Expansion of the leadership team with Dr. Gordon Downie as Chief Medical Officer is shaping clinical direction, including advancement toward pivotal trials[7] - The intellectual property portfolio continues to grow with newly granted patents in the U.S., China, Canada, and Australia, strengthening diagnostic and therapeutic platforms globally[8] - Future focus remains on expanding access to CyPath Lung, delivering operational efficiency, and advancing next-generation diagnostics and therapeutics[9] Second Quarter 2025 Financial Review The second quarter 2025 financial review details a decrease in total revenue due to discontinued services, a reduction in operating expenses, an increased net loss driven by non-cash items, and a decline in cash reserves despite a successful public offering Revenue Analysis Total revenue for Q2 2025 decreased significantly to $1.3 million from $2.4 million in Q2 2024, primarily due to the strategic discontinuation of unprofitable pathology services, however, CyPath Lung testing revenue for the first six months of 2025 increased by 62% year-over-year to $323,000, reflecting growth in physician adoption Net Revenue (Three Months Ended June 30) | Metric | Q2 2025 | Q2 2024 | | :----- | :------ | :------ | | Net Revenue | $1,269,483 | $2,397,652 | Net Revenue (Six Months Ended June 30) | Metric | H1 2025 | H1 2024 | | :----- | :------ | :------ | | Net Revenue | $3,123,080 | $4,804,043 | | CyPath Lung Testing Revenue | $323,000 | N/A | - The decrease in total revenue was primarily attributable to the Company's strategic decision to discontinue unprofitable pathology services and reallocate resources toward the commercialization of CyPath Lung[9] - CyPath Lung testing revenue for the six months ended June 30, 2025, increased approximately 62% year-over-year, reflecting growth in physician adoption and an increase in total test results delivered[9] Operating Expenses Analysis Operating expenses for Q2 2025 decreased by 16% to $3.8 million, mainly due to lower direct costs from laboratory operations and reduced research and development expenses, partially offset by increased clinical development spending in support of pivotal trials Operating Expenses (Three Months Ended June 30) | Expense Category | Q2 2025 | Q2 2024 | Change | | :--------------- | :------ | :------ | :----- | | Total Operating Expenses | $3,785,043 | $4,485,450 | -15.62% | | Direct costs and expenses | $1,016,602 | $1,407,710 | -27.78% | | Research and development | $311,372 | $402,433 | -22.63% | | Clinical development | $129,279 | $51,462 | +151.21% | | Selling, general and administrative | $2,214,561 | $2,472,775 | -10.44% | | Depreciation and amortization | $113,229 | $151,070 | -25.05% | - The decrease in operating expenses was primarily due to lower direct costs related to laboratory operations and reduced research and development expenses[10] - Increased clinical development spending was in support of the Company's pivotal trial strategy[10] Net Loss and Earnings Per Share The net loss for Q2 2025 increased to $4.1 million ($0.17 per share) from $2.1 million ($0.19 per share) in Q2 2024, primarily driven by a $1.5 million rise in non-cash expenses related to warrant remeasurement and public offering costs Net Loss and EPS (Three Months Ended June 30) | Metric | Q2 2025 | Q2 2024 | | :----- | :------ | :------ | | Net Loss | $(4,060,787) | $(2,110,279) | | Net Loss per Common Share (basic and diluted) | $(0.17) | $(0.19) | - The increase in net loss was primarily driven by a $1.5 million increase in non-cash expenses related to warrant remeasurement and offering costs associated with the May 2025 public offering[11] Liquidity and Capital Resources Cash and cash equivalents decreased to $0.8 million as of June 30, 2025, from $1.1 million at the end of 2024, with the company successfully raising $3.25 million through a public offering in May 2025 to provide working capital Cash and Cash Equivalents | Date | Amount | | :--- | :----- | | June 30, 2025 | $802,835 | | December 31, 2024 | $1,105,291 | - bioAffinity Technologies raised aggregate gross proceeds of $3.25 million through a public offering in May 2025[3][12] Company Profile This section outlines bioAffinity Technologies' core business as a biotechnology company specializing in noninvasive early-stage lung cancer diagnostics and broad-spectrum cancer treatments, featuring its flagship product, CyPath Lung Business Description bioAffinity Technologies is a biotechnology company focused on noninvasive diagnosis of early-stage lung cancer and other lung diseases, as well as developing broad-spectrum cancer treatments, with its flagship product, CyPath Lung, a highly sensitive, specific, and accurate noninvasive test for early-stage lung cancer, marketed as a Laboratory Developed Test (LDT) by its subsidiary, Precision Pathology Laboratory Services - bioAffinity Technologies, Inc. addresses the need for noninvasive diagnosis of early-stage cancer and diseases of the lung and broad-spectrum cancer treatments[13] - The Company's first product, CyPath Lung, is a noninvasive test that has shown high sensitivity, specificity and accuracy for the detection of early-stage lung cancer[13] - CyPath Lung is marketed as a Laboratory Developed Test (LDT) by Precision Pathology Laboratory Services, a subsidiary of bioAffinity Technologies[13] Condensed Consolidated Financial Statements The condensed consolidated financial statements present a decrease in total assets, a significant increase in total liabilities due to warrant recognition, a shift to a stockholders' deficit, and an increased net loss for both the quarter and six-month periods, influenced by warrant fair value changes Condensed Consolidated Balance Sheets As of June 30, 2025, total assets decreased to $4.75 million from $6.51 million at December 31, 2024, total liabilities significantly increased to $6.89 million from $3.91 million, primarily due to the recognition of a warrant liability, and consequently, total stockholders' equity shifted from a positive $2.60 million to a deficit of $(2.14) million Balance Sheet Highlights | Metric | June 30, 2025 | December 31, 2024 | Change | | :-------------------------- | :------------ | :---------------- | :----- | | Total Assets | $4,751,075 | $6,513,667 | -27.06% | | Total Liabilities | $6,887,183 | $3,911,631 | +76.06% | | Total Stockholders' Equity (Deficit) | $(2,136,108) | $2,602,036 | -182.09% | | Warrant liability | $3,974,911 | — | N/A | - Cash and cash equivalents decreased from $1,105,291 at December 31, 2024, to $802,835 at June 30, 2025[18] Unaudited Consolidated Statements of Operations For the three months ended June 30, 2025, net revenue was $1.27 million, leading to a net loss of $4.06 million, and for the six months ended June 30, 2025, net revenue was $3.12 million, with a net loss of $6.72 million, where the significant increase in net loss for both periods was largely influenced by a $1.06 million change in the fair value of warrants Statements of Operations (Three Months Ended June 30) | Metric | 2025 | 2024 | Change | | :-------------------------------- | :----------- | :----------- | :----- | | Net Revenue | $1,269,483 | $2,397,652 | -47.05% | | Total Operating Expenses | $3,785,043 | $4,485,450 | -15.62% | | Loss from Operations | $(2,515,560) | $(2,087,798) | +20.49% | | Change in fair value of warrants issued | $(1,062,818) | — | N/A | | Net Loss | $(4,060,787) | $(2,110,279) | +92.43% | | Net Loss per Common Share | $(0.17) | $(0.19) | -10.53% | Statements of Operations (Six Months Ended June 30) | Metric | 2025 | 2024 | Change | | :-------------------------------- | :----------- | :----------- | :----- | | Net Revenue | $3,123,080 | $4,804,043 | -35.00% | | Total Operating Expenses | $8,265,779 | $8,837,071 | -6.50% | | Loss from Operations | $(5,142,699) | $(4,033,028) | +27.53% | | Change in fair value of warrants issued | $(1,062,818) | — | N/A | | Net Loss | $(6,721,204) | $(4,072,094) | +65.05% | | Net Loss per Common Share | $(0.20) | $(0.38) | -47.37% | Additional Information This section includes important disclaimers regarding forward-looking statements, highlighting inherent risks and the company's non-obligation to update them, along with essential contact information for communications and investor relations Forward-Looking Statements This section contains forward-looking statements based on current estimates and assumptions, which are subject to various risks and uncertainties that could cause actual results to differ materially, with readers cautioned not to place undue reliance on these statements, and the company not undertaking any obligation to update them, except as required by applicable securities laws - Statements are based upon current estimates and assumptions and include statements regarding strategic actions, international patents, commercial growth, patient case studies, expanding access, and advancing new diagnostics[15] - These forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from current expectations[15] - The Company does not undertake any obligation to update any forward-looking statement relating to matters discussed in this press release, except as may be required by applicable securities laws[15] Contacts Contact information is provided for bioAffinity Technologies' Director of Communications and for Investor Relations through RedChip Companies Inc - bioAffinity Technologies contact: Julie Anne Overton, Director of Communications (jao@bioaffinitytech.com)[16] - Investor Relations contact: Dave Gentry, RedChip Companies Inc. (1-800-RED-CHIP or 407-491-4498, BIAF@redchip.com)[16]