GeneDx Conference Call Summary Company Overview - **Company**: GeneDx - **Industry**: Healthcare, specifically genetic testing and diagnostics Key Financial Highlights - **2025 Performance**: - Revenue: $427 million - Volume Growth: Over 30% - Gross Margins: Over 70% [3][43] - **2026 Guidance**: - Projected Revenue: $540-$555 million - Expected Growth: 33-35% in revenue and volume - Adjusted Gross Margins: At least 70% [43] Core Business Insights - **Genetic Testing Leadership**: - GeneDx holds 80% market share in pediatric genetic testing [20]. - The company is recognized for having the number one genetic test, with 80% of geneticists choosing GeneDx [7]. - **Data Asset**: - GeneDx Infinity is the largest and most diverse rare disease data asset, containing over 1 million exomes and genomes, 8 million health records, and 7 million phenotypic data points [16][18]. - The database has grown by 30% in 2025 alone, surpassing the previous 24 years combined [11][49]. Market Opportunities - **Pediatric Care**: - The American Academy of Pediatrics updated guidelines directing pediatricians to utilize exome and genome sequencing, expected to drive significant growth [10][29]. - There are approximately 600,000 patients diagnosed with developmental delays annually, presenting a substantial market opportunity [30]. - **New Markets**: - GeneDx plans to enter prenatal diagnostics and adult conditions, including epilepsy and autism, expanding its service offerings [33][35]. - The company aims to establish a global footprint through international expansion and decentralized testing capabilities [47]. Technological Advancements - **AI Integration**: - AI is being utilized to enhance diagnostic accuracy and speed, allowing for quicker identification of disease-causing variants [19]. - **Precision Medicine**: - GeneDx focuses on connecting patients with tailored treatment plans based on their genetic profiles, aiming to reduce the average diagnostic odyssey from five years to weeks [21][22]. Patient-Centric Approach - **Advocacy and Awareness**: - GeneDx emphasizes the importance of patient advocacy, encouraging families to seek genetic testing and work with their healthcare providers [6][23]. - **Health Economics**: - The company highlights the economic burden of delayed diagnoses, estimating it contributes to a trillion-dollar burden in the U.S. healthcare system [22]. Future Aspirations - **Genomic Newborn Screening**: - GeneDx aims to implement universal genomic newborn screening, which could identify clinically actionable conditions in 3.2% of newborns [38][39]. - **Collaboration with Biopharma**: - The company seeks to leverage its data for drug discovery and development, partnering with biopharmaceutical companies to enhance therapeutic options for patients [41][42]. Conclusion - GeneDx is positioned as a leader in pediatric genetic testing, with a strong focus on growth through new market opportunities, technological advancements, and a commitment to patient-centric care. The company aims to transform the standard of care in genetic diagnostics and precision medicine while maintaining profitability and expanding its global reach [43][54].

Financial Data and Key Metrics Changes - The company reported third quarter 2025 revenues of $116.7 million, a 52% increase year-over-year [14] - Adjusted gross margin expanded to 74%, driven by favorable mix shift, improved reimbursement, and lower COGS [17] - Adjusted net income for the quarter was $14.7 million, with adjusted basic EPS of $0.51 [21] Business Line Data and Key Metrics Changes - Revenue from exome and genome testing was $98.9 million, up 66% from the same quarter last year [14] - The company conducted 25,702 exome and genome tests in the third quarter, with growth accelerating from 24% year-over-year in Q1 to 33% in Q3 [14] - The hereditary cancer offerings were discontinued, generating $1.2 million in Q3 2025, down from $3.3 million in the same quarter last year [22] Market Data and Key Metrics Changes - The average reimbursement rate for exome and genome testing was over $3,800 in Q3, up from approximately $3,700 in the previous quarter [16] - The NICU market remains underpenetrated, with less than 5% of NICU patients receiving genetic testing [10] - The company is on track to activate at least 12 Epic Aura integrations by the end of the year [10] Company Strategy and Development Direction - The company aims to drive high profitable growth, offer best-in-class diagnostics, and build a network for precision medicine [6] - GeneDx Infinity, the largest rare disease dataset, is leveraged to generate genomic insights and enable fast diagnoses [7] - The company plans to nearly double its sales force over the coming quarters to enhance market penetration [9] Management's Comments on Operating Environment and Future Outlook - Management raised 2025 revenue guidance to $425 million-$428 million, reflecting strong momentum [5] - The company is focused on transforming healthcare from reactive to proactive, particularly in newborn screening [11] - Management expressed confidence in maintaining profitability while investing in long-term growth [19] Other Important Information - The FDA granted breakthrough device designation to ExomeDx and GenomeDx tests, validating the company's technology [7] - The company is expanding its international market presence and has begun hiring for key positions [12][8] - The company generated $9 million in free cash flow during the third quarter [21] Q&A Session Summary Question: Has there been an uptick in volume due to the AAP guidelines? - Management noted that most pediatricians are hearing about the guidelines from GeneDx and emphasized the need for education [31] Question: What is the outlook for average selling prices and margins? - Management indicated that ASPs may decrease slightly due to new market entries but remains optimistic about long-term margins [34][37] Question: What is the status of the NICU market? - Management confirmed that NICU volumes are growing and that they are on track to activate more systems [40][44] Question: Can you elaborate on OpEx spending and its impact? - Management stated that OpEx is expected to increase as they build out the sales team and invest in growth initiatives [47][49] Question: What is the plan for the sales force expansion? - Management plans to double the sales force and is currently hiring Regional Sales Directors to lead the effort [52][53] Question: What is the expected impact of the FDA breakthrough designation? - Management believes the designation will enhance market access and validate their technology among clinicians [63][68]

Financial Data and Key Metrics Changes - GeneDx reported third quarter 2025 revenues of $116.7 million, a 52% increase year over year [13] - Adjusted gross margin expanded to 74%, driven by favorable mix shift, improved reimbursement, and lower COGS [17] - Adjusted net income for the quarter was $14.7 million, with adjusted basic EPS of $0.51 [20] Business Line Data and Key Metrics Changes - Revenue from exome and genome testing reached $98.9 million, up 66% from the same quarter last year [13] - The company performed 25,702 exome and genome tests in the third quarter, with growth accelerating from 24% year over year in Q1 to 33% in Q3 [14] - The average reimbursement rate for exome and genome testing was over $3,800 in Q3, up from approximately $3,700 in the previous quarter [16] Market Data and Key Metrics Changes - GeneDx is the largest provider of rare disease diagnoses globally, with over 10,000 rare diseases impacting one in 10 Americans [8] - The NICU market remains underpenetrated, with less than 5% of NICU patients receiving genetic testing [9] - The company is expanding its presence in international markets, leveraging the Fabric Genomics platform [11] Company Strategy and Development Direction - GeneDx aims to drive high profitable growth, offer best-in-class diagnostics, and build network effects to usher in the next era of precision medicine [6] - The company is focused on expanding its sales force, nearly doubling it over the coming quarters [9] - GeneDx is investing in customer experience and medical education to drive utilization and adoption of its testing services [9][19] Management's Comments on Operating Environment and Future Outlook - Management raised 2025 revenue guidance to $425 to $428 million, reflecting strong momentum [5] - The company expects continued volume growth in exome and genome testing, with a forecast of at least 30% volume growth for the full year 2025 [22] - Management expressed confidence in maintaining profitability while investing in long-term growth initiatives [20][50] Other Important Information - The company discontinued its hereditary cancer offerings, which generated $1.2 million in Q3 2025 [22] - GeneDx received FDA breakthrough device designation for its ExomeDx and GenomeDx tests, validating its technology [7] Q&A Session Summary Question: Has there been an uptick in volume for chromosomal microarray testing? - Management noted that most pediatricians are hearing about updated guidelines for the first time from GeneDx, indicating a need for education [31] Question: What is the outlook for average selling prices and margins? - Management indicated that ASPs may decrease slightly in Q4 due to new market entries but emphasized that this impact should be transitory [34][36] Question: What is the growth outlook for the NICU market? - Management highlighted that NICU volumes are growing nicely and are expected to ramp significantly in the coming quarters [42][45] Question: What is the strategy for expanding the sales force? - Management confirmed plans to double the sales force and emphasized the importance of hiring the best talent available [53][54] Question: What is the expected impact of the FDA breakthrough designation? - Management explained that the designation signals the uniqueness of their test and facilitates an expedited regulatory review process [67][68]

Financial Data and Key Metrics Changes - The company reported third quarter 2025 revenues of $116.7 million, a 52% increase year over year [13] - Revenue from exome and genome testing was $98.9 million, up 66% from the same quarter last year [13] - Adjusted total operating expenses were $71 million, representing 61% of revenue for the quarter [18][20] - Adjusted net income for the quarter was $14.7 million, with adjusted basic EPS of $0.51 [20] Business Line Data and Key Metrics Changes - The company conducted 25,702 exome and genome tests in the third quarter, with growth accelerating to 33% year over year [13] - The average reimbursement rate for exome and genome tests was over $3,800, up from approximately $3,700 last quarter [16] - The company discontinued its hereditary cancer offerings, which generated $1.2 million in the third quarter of 2025 [21] Market Data and Key Metrics Changes - The NICU market remains underpenetrated, with less than 5% of NICU patients receiving genetic testing [10] - The company is on track to activate at least 12 Epic Aura integrations by the end of the year [10] - The company expects to see significant growth in the NICU channel, which is one of the fastest-growing segments [43] Company Strategy and Development Direction - The company is raising its 2025 revenue guidance to $425 to $428 million, reflecting strong momentum [4] - The strategy focuses on high profitable growth, best-in-class diagnostics, and building network effects to enhance precision medicine [5] - The company aims to deepen market penetration while expanding into new markets, including general pediatricians and international markets [8] Management's Comments on Operating Environment and Future Outlook - Management emphasized the importance of education and workflow improvements for pediatricians to drive testing adoption [31] - The company is optimistic about the future, with expectations for continued volume growth and profitability [22] - Management highlighted the FDA's breakthrough device designation as a validation of their technology and a catalyst for market expansion [66] Other Important Information - The company is investing in customer experience and medical education to drive utilization and expand its authority in genomics [9] - The company has a strong cash position with $156 million in cash, cash equivalents, and marketable securities as of September 30, 2025 [20] Q&A Session Summary Question: Has there been an uptick in volume for chromosomal microarray testing? - Management noted that most growth is coming from core markets, with no significant uptake in orders from pediatricians yet, but positive engagement is expected [31][32] Question: What is the outlook for average selling prices and margins? - Management indicated that average selling prices may decrease slightly due to new market entries but emphasized that this impact should be temporary [34][37] Question: What is the status of the NICU market? - Management confirmed that NICU volumes are growing nicely and are expected to contribute significantly to overall growth [40][43] Question: Can you elaborate on operating expenses and their impact on growth? - Management stated that operating expenses are strategic investments aimed at driving long-term growth, with expectations for continued increases in the near term [48][49] Question: What is the strategy for expanding Medicaid coverage? - Management highlighted the recent expansion of Medi-Cal coverage for whole genome testing and plans to secure coverage in additional states [80]

Core Insights - GeneDx is positioned as a leader in genomics and rare-disease diagnostics, with significant growth potential highlighted by recent FDA designations and strong sales performance [2][3][4]. Company Overview - GeneDx, based in Stamford, Connecticut, specializes in rare-disease diagnosis and has developed GeneDx Infinity, the largest rare-disease dataset from 25 years of genomic tests [2]. - The company aims to transition healthcare from reactive to proactive approaches [2]. Financial Performance - Over the last six quarters, GeneDx has reported sales growth between 40% and 67%, with a 46% increase in revenue to $102.7 million in the third quarter [3]. - Earnings per share surged by 725% to 50 cents, compared to a loss in the previous year [3]. - Analysts project a 37% sales growth to $104.7 million and a 954% increase in earnings to 42 cents per share for the upcoming report [4]. Market Demand and Stock Performance - The strong growth trajectory has led to increased demand for GeneDx stock, reflected in a B+ Accumulation/Distribution Rating and a 1.2 up/down volume ratio [5]. - The number of funds holding GeneDx shares rose from 359 to 390, indicating growing institutional interest [5]. - GeneDx holds a 98 Composite Rating, outperforming 98% of stocks based on key fundamental and technical factors [5]. Technical Analysis - GeneDx stock is currently in a first-stage consolidation pattern, with a buy point set at 136 [6]. - A short-term concern is the 21-day exponential moving average falling below the 50-day moving average, which investors should monitor for signs of technical recovery [6].