Personalis(US:PSNL)2019-08-14 08:25Financial Data and Key Metrics Changes - Revenues for Q2 2019 were $15.8 million, an increase of 80% from $8.8 million in the same period last year, marking a new record high for quarterly revenue [18] - Gross margin for Q2 was 37.3%, an increase of 10.1 percentage points from 27.2% in the same period last year [21] - Net loss for Q2 was $5.9 million, compared to a net loss of $7.3 million for the same period last year, with net loss per share of $0.89 [23] Business Line Data and Key Metrics Changes - Biopharma customer revenue represented $7.3 million, while the Million Veteran Program (MVP) accounted for $8.5 million in Q2 [11][18] - The MVP is expected to continue being the largest single customer for the next few years, with significant contributions to revenue growth [11][12] Market Data and Key Metrics Changes - The MVP is one of the largest and fastest-growing population sequencing efforts globally, with over 770,000 enrollees [10] - The pharmaceutical industry spends approximately $60,000 per patient in oncology clinical trials, indicating a substantial market opportunity for Personalis [6] Company Strategy and Development Direction - The company aims to expand its research and development and build out its commercial infrastructure to deliver high-value genomic information [5] - Personalis is focused on innovating and scaling operational know-how and infrastructure to grow capacity, with plans to launch a diagnostic for biopharma customers later this year [12][14] - The company is also investing in new product innovations and enhancements to maintain its leading position in the market [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth of both biopharma and MVP business lines over the long term, despite potential quarterly variability [12][19] - The company expects total consolidated revenue to grow sequentially in Q3, driven by the MVP [20] Other Important Information - The company raised $140 million in its IPO, strengthening its balance sheet and providing capital for future growth [5][24] - Operating expenses totaled $10 million, a decrease as a percentage of revenue compared to the previous year, indicating improved operational efficiency [22] Q&A Session Summary Question: Expectations for MVP in Q3 and Q4 - Management indicated that MVP sample volume has been strong and could continue to increase, while biopharma revenue may be lower in Q3 due to sample delays from Q1 [29] Question: Customer feedback on ImmunoID NeXT and liquid biopsy launch - Feedback on ImmunoID NeXT has been encouraging, with customers impressed by its comprehensive analytics; the liquid biopsy product is on track for a 2020 launch [30][32] Question: Existing pharma customers' purchasing behavior - The whole genome sequencing business is primarily for the VA, while the company is focused on expanding its offerings to meet diverse customer needs [36] Question: Customer concentration and new customer additions - Customer concentration is expected to diminish over time as the company broadens its customer base, with ongoing efforts to add new customers [50][51] Question: Steps to launch liquid biopsy product - The product development involves multiple steps, with a focus on ensuring the assay and informatics are robust before market release [41] Question: Contribution of new diagnostic assay to 2019 guidance - The new diagnostic assay is expected to be introduced in 2019 but may not significantly impact revenue until 2020 [49]