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News   Press Releases

GeneDx Reports Second Quarter 2024 Financial Results and Business Highlights

WGS | July 30, 2024

Reported second quarter 2024 revenue from continuing operations1 of $68.9M with 77% year-over-year growth of exome and genome test revenue

Expanded second quarter 2024 adjusted gross margins2 from continuing operations to 62%

Narrowed second quarter 2024 adjusted net loss2 to $2.7M

Raising guidance to deliver between $255M and $265M in FY 2024 revenue and reiterate path to profitability in 2025

GeneDx to host conference call today at 4:30 p.m. ET

GeneDx Holdings Corp. (Nasdaq: WGS), a leader in delivering improved health outcomes through genomic insights, today reported its financial results for the second quarter of 2024.

“Our continued organizational focus on execution fueled our strong second quarter results, giving us confidence to raise full year 2024 revenue guidance to between $255-$265 million and reiterate our expectation to reach profitability in the next several quarters,” said Katherine Stueland, President and Chief Executive Officer at GeneDx. “The strength in our performance across all measures of the business has enabled us to begin investments in future growth opportunities for our business with a focus on extending our leadership in whole exome sequencing to whole genome sequencing to ensure we continue to lead the charge in quickly providing the most accurate and actionable genetic information to diagnose disease for as many patients and families as possible.”

Second Quarter 2024 Financial Results (Unaudited)1,2

Revenues

  • Revenues from continuing operations grew to $68.9 million, an increase of 52% year-over-year and 12% sequentially.
    • Total company revenues were $70.5 million.
  • Exome and genome test revenue grew to $50.7 million, an increase of 77% year-over-year and 15% sequentially.

Exome and genome volume

  • Exome and genome test results volume grew to 18,017, an increase of 52% year-over-year and 9% sequentially.
  • Exome and genome represented 31% of all test results, up from 22% in the second quarter of 2023 and up from 30% in the first quarter of 2024.

Gross margin

  • Adjusted gross margin from continuing operations expanded to 62%, up from 37% in the second quarter of 2023 and up from 61% in the first quarter of 2024.
    • Total company gross margin was 61%.

Operating expenses

  • Adjusted total operating expenses reduced to $45.0 million, a decrease of 24% year-over-year and 1% sequentially.
    • Total GAAP operating expenses were $52.7 million.

Net loss

  • Adjusted net loss narrowed to $2.7 million, an improvement of 93% year-over-year and 68% sequentially.
    • GAAP net loss was $29.2 million, inclusive of a one-time, net litigation charge of $13 million.

Cash burn and cash position

  • Total net use of cash was $6.1 million in the second quarter of 2024, an improvement of 89% year-over-year and 65% sequentially.
  • Cash, cash equivalents, marketable securities and restricted cash was $107.8 million as of June 30, 2024.
1.

Revenue and gross margin results from continuing operations, which we believe are representative of our ongoing business strategy exclude any revenue and cost of goods sold of the exited Legacy Sema4 diagnostic testing business for the current and all comparative periods. Total company results include GeneDx’s continuing operations and the financial impacts of exited Legacy Sema4 business activities for the current and all comparative periods.

2.

Adjusted gross margin, adjusted total operating expenses and adjusted net loss are non-GAAP financial measures. See appendix for a reconciliation of GAAP to Non-GAAP figures presented.

GeneDx Full Year 2024 Guidance

GeneDx has updated full year 2024 guidance. Management expects GeneDx to:

  • Drive full year 2024 revenues1 between $255 and $265 million (previous guidance was between $235 and $245 million);
  • Expand full year 2024 adjusted gross margin profile to at least 60% (no change);
  • Use between $65 to $70 million of net cash for full year 2024 (previous guidance was between $70 to $80 million);
  • Turn to profitability in 2025 (no change).
1.

Total company results include the combination of the GeneDx diagnostic business revenues and the data and information revenues from the Legacy Sema4 business.

Second Quarter 2024 Business Highlights

Driving sustainable growth, expanding access and improving the standard of care

  • Announced collaboration with Epic Aura1 to expand access to rapid whole genome sequencing (“rWGS”) services to inform diagnosis for affected pediatric and neonatal patients, enhancing GeneDx’s commercial footprint within leading health systems.
  • Launched first-of-its-kind Patient Access Program in collaboration with leading biopharma partners to expand access to exome testing for pediatric epilepsy patients.
  • Grew biopharma partner programs to 32, predominantly with biotech companies who are relying on us to find patients with a specific variant for clinical trial purposes.
  • North Carolina Medicaid has expanded its existing coverage of outpatient whole exome sequencing (“WES”) to include the analysis of family comparator samples, which increases the rate of diagnosis of WES, effective June 1, 2024.
  • State Medicaid programs continue to expand coverage of rapid genome sequencing in the neonatal intensive care unit (“NICU”), bringing total states covering rapid whole genome in the acute care setting to 14, including new coverage announced in:
    • North Carolina (June 2024)
    • Tennessee (July 2024)
    • Connecticut (July 2024)
  • Announced reinvestment in rapid and standard whole genome sequencing products, enabling:
    • Faster turnaround time for rWGS with a written report in as fast as 5 days
    • Buccal samples (cheek swab) allowing for easier and more accessible non-invasive sample collection method for even the youngest patients
    • Expanding the number of repeat expansions covered by whole genome sequencing to increase diagnostic yield and improve the provider and patient experience by decreasing the need for follow-up testing
1.

Epic and Aura are trademarks of Epic Systems Corporation.

Webcast and Conference Call Details

GeneDx will host a conference call today, July 30, 2024, at 4:30 p.m. Eastern Time. Investors interested in listening to the conference call are required to register online. A live and archived webcast of the event will be available on the “Events” section of the GeneDx investor relations website at https://ir.genedx.com/.

Forward-Looking Statements

This press release contains certain forward-looking statements within the meaning of the federal securities laws, including statements regarding our future performance and our market opportunity, including our expected full year 2024 reported revenue guidance, our expectations regarding our adjusted gross margin profile in 2024, our use of net cash in 2024 and our turning profitable in 2025. These forward-looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “future,” “opportunity,” “plan,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this press release, including but not limited to: (i) our ability to implement business plans, goals and forecasts, and identify and realize additional opportunities, (ii) the risk of downturns and a changing regulatory landscape in the highly competitive healthcare industry, (iii) the size and growth of the market in which we operate, (iv) our ability to pursue our new strategic direction, and (v) our ability to enhance our artificial intelligence tools that we use in our clinical interpretation platform. The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and the other risks and uncertainties described in the “Risk Factors” section of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the U.S. Securities and Exchange Commission (the “SEC”) on February 23, 2024 and other documents filed by us from time to time with the SEC. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and we assume no obligation and do not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise. We do not give any assurance that we will achieve our expectations.

About GeneDx

At GeneDx (Nasdaq: WGS), we believe that everyone deserves personalized, targeted medical care—and that it all begins with a genetic diagnosis. Fueled by one of the world’s largest rare disease data sets, our industry-leading exome and genome tests translate complex genomic data into clinical answers that unlock personalized health plans, accelerate drug discovery, and improve health system efficiencies. It all starts with a single test. For more information, please visit genedx.com and connect with us on LinkedIn, X, Facebook, and Instagram.

Volume and revenue in the table below include the combination of the Legacy GeneDx diagnostic business with the data and information business of Legacy Sema4.

Volume & Revenue

2Q24

1Q24

4Q23

3Q23

2Q23

Volumes

Whole exome, whole genome

18,017

16,592

15,663

13,216

11,855

Hereditary cancer

5,482

6,868

8,240

8,556

7,142

Other panels

34,204

31,763

33,692

35,861

35,931

Total

57,703

55,223

57,595

57,633

54,928

Revenue ($ millions)

Whole exome, whole genome

$

50.7

$

44.0

$

39.2

$

34.0

$

28.7

Hereditary cancer

3.8

5.5

5.5

4.5

3.8

Other panels

13.3

10.7

11.2

10.6

10.6

Data information

1.1

1.3

2.2

1.3

2.1

Total

$

68.9

$

61.5

$

58.1

$

50.4

$

45.2

Unaudited Select Financial Information (in thousands)

Three months ended June 30, 2024

Three months ended March 31, 2024

GeneDx

Legacy Sema4

Total

GeneDx

Legacy Sema4

Total

Revenue

$68,924

$1,590

$70,514

$61,461

$961

$62,422

Adjusted cost of services

26,523

145

26,668

24,099

—

24,099

Adjusted gross profit (loss)

$42,401

$1,445

$43,846

$37,362

$961

$38,323

Adjusted gross margin %

61.5%

90.9%

62.2%

60.8%

100.0%

61.4%

Three months ended June 30, 2023

GeneDx

Legacy Sema4

Total

Revenue

$45,226

$3,480

$48,706

Adjusted cost of services

28,452

—

28,452

Adjusted gross profit (loss)

$16,774

$3,480

$20,254

Adjusted gross margin %

37.1%

100.0%

41.6%

Three months ended June 30, 2024

Reported

Depreciation and amortization

Stock-based compensation expense

Restructuring costs

Change in FV of financial liabilities

Charges related to business exit

Other

Adjusted

Diagnostic test revenue

$

69,439

$

—

$

—

$

—

$

—

$

—

$

—

$

69,439

Other revenue

1,075

—

—

—

—

—

—

1,075

Total revenue

70,514

—

—

—

—

—

—

70,514

Cost of services

27,562

(808

)

(86

)

—

—

—

—

26,668

Gross profit (loss)

42,952

808

86

—

—

—

—

43,846

Gross margin

60.9

%

62.2

%

Research and development

10,902

(211

)

(347

)

(35

)

—

—

—

10,309

Selling and marketing

16,585

(1,225

)

(368

)

(63

)

—

—

—

14,929

General and administrative

25,170

(2,974

)

(2,307

)

(150

)

—

—

—

19,739

Impairment loss

—

—

—

—

—

—

—

—

Other, net

874

—

—

—

—

—

—

874

Loss from operations

(10,579

)

5,218

3,108

248

—

—

—

(2,005

)

Interest income (expense), net

(894

)

—

—

—

—

—

—

(894

)

Other income (expense), net

(17,890

)

—

—

—

4,409

—

13,450

(31

)

Income tax benefit

190

—

—

—

—

—

—

190

Net loss

$

(29,173

)

$

5,218

$

3,108

$

248

$

4,409

$

—

$

13,450

$

(2,740

)

Three months ended June 30, 2023

Reported

Depreciation and amortization

Stock-based compensation expense

Restructuring costs

Change in FV of financial liabilities

Charges related to business exit

Other

Adjusted

Diagnostic test revenue

$

46,635

$

—

$

—

$

—

$

—

$

—

$

—

$

46,635

Other revenue

2,071

—

—

—

—

—

—

2,071

Total revenue

48,706

—

—

—

—

—

—

48,706

Cost of services

29,949

(1,233

)

(251

)

(13

)

—

—

—

28,452

Gross profit (loss)

18,757

1,233

251

13

—

—

—

20,254

Gross margin

38.5

%

41.6

%

Research and development

17,138

(4,656

)

675

(815

)

—

—

—

12,342

Selling and marketing

15,182

(1,225

)

143

(326

)

—

—

—

13,774

General and administrative

37,341

(3,218

)

(675

)

(483

)

—

—

—

32,965

Impairment loss

—

—

—

—

—

—

—

—

Other, net

718

—

—

—

—

334

3,238

4,290

Loss from operations

(51,622

)

10,332

108

1,637

—

(334

)

(3,238

)

(43,117

)

Interest income (expense), net

1,074

—

—

—

—

—

—

1,074

Other income (expense), net

3,633

—

—

—

(3,547

)

—

(86

)

—

Income tax benefit

196

—

—

—

—

—

—

196

Net loss

$

(46,719

)

$

10,332

$

108

$

1,637

$

(3,547

)

$

(334

)

$

(3,324

)

$

(41,847

)

Three months ended March 31, 2024

Reported

Depreciation and amortization

Stock-based compensation expense

Restructuring costs

Change in FV of financial liabilities

Charges related to business exit

Other

Adjusted

Diagnostic test revenue

$

61,104

$

—

$

—

$

—

$

—

$

—

$

—

$

61,104

Other revenue

1,318

—

—

—

—

—

—

1,318

Total revenue

62,422

—

—

—

—

—

—

62,422

Cost of services

25,011

(816

)

(48

)

(48

)

—

—

—

24,099

Gross profit (loss)

37,411

816

48

48

—

—

—

38,323

Gross margin

59.9

%

61.4

%

Research and development

11,567

(196

)

187

(103

)

—

—

—

11,455

Selling and marketing

16,085

(1,225

)

20

(400

)

—

—

—

14,480

General and administrative

22,445

(3,011

)

292

(292

)

—

—

—

19,434

Impairment loss

—

—

—

—

—

—

—

—

Other, net

974

—

—

—

—

—

—

974

Loss from operations

(13,660

)

5,248

(451

)

843

—

—

—

(8,020

)

Interest income (expense), net

(597

)

—

—

—

—

—

—

(597

)

Other income (expense), net

(6,064

)

—

—

—

6,101

—

—

37

Income tax benefit

82

—

—

—

—

—

—

82

Net loss

$

(20,239

)

$

5,248

$

(451

)

$

843

$

6,101

$

—

$

—

$

(8,498

)

GeneDx Holdings Corp.

Condensed Consolidated Balance Sheets

(in thousands, except share and per share amounts)

June 30, 2024 (Unaudited)

December 31, 2023

Assets:

Current assets:

Cash and cash equivalents

$

56,076

$

99,681

Marketable securities

50,784

30,467

Accounts receivable

25,500

32,371

Due from related parties

693

445

Inventory, net

10,322

8,777

Prepaid expenses and other current assets

18,792

10,598

Total current assets

162,167

182,339

Operating lease right-of-use assets

25,624

26,900

Property and equipment, net

31,339

32,479

Intangible assets, net

165,613

172,625

Other assets (1)

4,357

4,413

Total assets

$

389,100

$

418,756

Liabilities and Stockholders’ Equity:

Current liabilities:

Accounts payable and accrued expenses

$

51,959

$

37,456

Due to related parties

1,213

1,379

Short-term lease liabilities

4,001

3,647

Other current liabilities

11,097

16,336

Total current liabilities

68,270

58,818

Long-term debt, net of current portion

52,160

52,688

Long-term lease liabilities

60,800

62,938

Other liabilities

12,660

14,735

Deferred taxes

1,167

1,560

Total liabilities

195,057

190,739

Stockholders’ Equity:

Preferred stock

—

—

Class A common stock

2

2

Additional paid-in capital

1,543,182

1,527,778

Accumulated deficit

(1,349,600

)

(1,300,188

)

Accumulated other comprehensive income

459

425

Total stockholders’ equity

194,043

228,017

Total liabilities and stockholders’ equity

$

389,100

$

418,756

(1)

Other assets includes $987 thousand of restricted cash as of both June 30, 2024 and December 31, 2023.

GeneDx Holdings Corp.

Condensed Consolidated Statements of Operations (Unaudited)

(in thousands, except share and per share amounts)

June 30,

Six months ended June 30,

2024

2023

2024

2023

Revenue

Diagnostic test revenue

$

69,439

$

46,635

$

130,543

$

88,485

Other revenue

1,075

2,071

2,393

3,360

Total revenue

70,514

48,706

132,936

91,845

Cost of services

27,562

29,949

52,573

57,852

Gross profit

42,952

18,757

80,363

33,993

Research and development

10,902

17,138

22,469

31,730

Selling and marketing

16,585

15,182

32,670

28,634

General and administrative

25,170

37,341

47,615

81,030

Impairment loss

—

—

—

2,120

Other operating expenses, net

874

718

1,848

2,465

Loss from operations

(10,579

)

(51,622

)

(24,239

)

(111,986

)

Non-operating income (expenses), net

Change in fair value of warrants and earn-out contingent liabilities

(4,409

)

3,547

(10,510

)

94

Interest expense, net

(894

)

1,074

(1,491

)

1,039

Other expense, net

(13,481

)

86

(13,444

)

2,802

Total non-operating income, net

(18,784

)

4,707

(25,445

)

3,935

Loss before income taxes

(29,363

)

(46,915

)

$

(49,684

)

$

(108,051

)

Income tax benefit

190

196

272

343

Net loss

$

(29,173

)

$

(46,719

)

$

(49,412

)

$

(107,708

)

Weighted average shares outstanding of Class A common stock

26,617,955

25,418,358

26,340,063

22,754,948

Basic and diluted net loss per share, Class A common stock

$

(1.10

)

$

(1.84

)

$

(1.88

)

$

(4.73

)

GeneDx Holdings Corp.

Condensed Consolidated Statements of Cash Flows (Unaudited)

(in thousands)

Six months ended June 30,

2024

2023

Operating activities

Net loss

$

(49,412

)

$

(107,708

)

Adjustments to reconcile net loss to net cash used in operating activities:

Depreciation and amortization expense

10,466

18,968

Stock-based compensation expense

2,657

156

Change in fair value of warrants and contingent liabilities

10,510

(94

)

Deferred tax benefit

(272

)

(343

)

Provision for excess and obsolete inventory

109

2,620

Legal reserves

13,450

—

Change in third party payor reserves

1,066

(4,308

)

Gain on sale of assets

—

(2,954

)

Gain on debt forgiveness

—

(2,750

)

Impairment loss

—

2,120

Other

1,738

412

Change in operating assets and liabilities:

Accounts receivable

6,871

10,174

Inventory

(1,654

)

(486

)

Accounts payable and accrued expenses

(10,359

)

(25,399

)

Other assets and liabilities

(6,088

)

531

Net cash used in operating activities

(20,918

)

(109,061

)

Investing activities

Consideration on escrow paid for GeneDx acquisition

—

(12,144

)

Purchases of property and equipment

(1,795

)

(2,762

)

Proceeds from sales of assets

—

3,634

Purchases of marketable securities

(29,381

)

—

Proceeds from sales of marketable securities

598

—

Proceeds from maturities of marketable securities

8,720

—

Development of internal-use software assets

—

(461

)

Net cash used in investing activities

(21,858

)

(11,733

)

Financing activities

Proceeds from offerings, net of issuance costs

—

143,002

Exercise of stock options

161

266

Long-term debt principal payments

—

(2,000

)

Finance lease payoff and principal payments

(990

)

(1,222

)

Net cash (used in) provided by financing activities

(829

)

140,046

Net (decrease) increase in cash, cash equivalents and restricted cash

(43,605

)

19,252

Cash, cash equivalents and restricted cash, at beginning of period

100,668

138,303

Cash, cash equivalents and restricted cash, at end of period (1)

$

57,063

$

157,555

Supplemental disclosures of cash flow information

Cash paid for interest

$

4,033

$

946

Cash paid for taxes

$

557

$

1,003

Stock consideration paid for purchase of business

$

—

$

6,692

Stock consideration paid pursuant to exercise of Perceptive warrant

$

12,586

$

—

Purchases of property and equipment in accounts payable and accrued expenses

$

501

$

109

Assets acquired under capital leases obligations

$

689

$

—

(1)

Cash, cash equivalents and restricted cash at June 30, 2024 excludes marketable securities of $50.8 million.

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