Guardant Health Reports Third Quarter 2024 Financial Results and Increases 2024 Revenue Guidance
Revenue growth of 34% driven by strong clinical and biopharma volume and Guardant360 ASP tailwinds
Shield received favorable Medicare pricing of
Third Quarter 2024 Financial Highlights
-
Recorded revenue of
$191.5 million for the third quarter of 2024, an increase of 34% over the third quarter of 2023 - Reported 53,100 clinical tests (excluding Shield) and 10,500 biopharma tests in the third quarter of 2024, representing increases of 21% and 40%, respectively, over the third quarter of 2023
-
Achieved Guardant360 ASP of over
$3,000 -
Raised 2024 annual guidance for revenue to a new range of
$720 to$725 million , representing growth of 28% to 29% -
Improved free cash flow to
$(55) million in the third quarter of 2024, compared to$(80) million in the prior year -
Revised annual free cash flow guidance to
$(265) to$(275) million , an improvement of$70 to$80 million compared to 2023
Recent Operating Highlights
- Successfully launched Shield IVD with strong reception from physicians and patients
-
Received Medicare pricing of
$920 for Shield effectiveAugust 1, 2024 - CMS finalized its policy to remove cost-sharing for a follow-on colonoscopy after a blood-based screening test for Medicare beneficiaries
-
Announced Medicare pricing for TissueNext will increase from
$3,100 to$3,500 effectiveJanuary 1, 2025 -
Entered into laboratory partnership with Policlinico Gemelli in
Italy , a leading European oncology center, to test advanced cancer patients locally - Published data from SCRUM-Japan GOZILA study in Nature Medicine showing patients receiving Guardant360 CDx guided treatment survived twice as long
“We had another record quarter of revenue driven by significant Guardant360 reimbursement tailwinds and volume growth,” said
“Shield has received a very positive reception from physicians and patients in the first few months of commercial launch following FDA approval,” said AmirAli Talasaz, co-founder and co-CEO. “We were very pleased to see Shield receive a Medicare price of
Third Quarter 2024 Financial Results
Revenue was
Gross profit, or total revenue less cost of precision oncology testing and cost of development services and other, was
Non-GAAP gross profit was
Non-GAAP gross profit excluding cost of screening was
Operating expenses were
Net loss was
Non-GAAP net loss was
Adjusted EBITDA loss was
Free cash flow for the third quarter of 2024 was
2024 Guidance
Webcast Information
Non-GAAP Measures
We define our non-GAAP measures as the applicable GAAP measure adjusted for the impacts of stock-based compensation and related employer payroll tax payments, contingent consideration, amortization of intangible assets, unrealized and realized gains and losses on marketable equity securities, impairment of non-marketable equity securities and other related assets, and other non-recurring items.
Adjusted EBITDA is defined as net loss adjusted for interest income; interest expense; other income (expense), net; provision for income taxes; depreciation and amortization expense; stock-based compensation expense and related employer payroll tax payments; contingent consideration; and other non-recurring items. Free cash flow is defined as net cash used in operating activities in the period less purchase of property and equipment in the period.
We believe that the exclusion of certain income and expenses in calculating these non-GAAP financial measures can provide a useful measure for investors when comparing our period-to-period core operating results, and when comparing those same results to that published by our peers. We exclude certain items because we believe that these income and expenses do not reflect expected future operating performance. Additionally, certain items are inconsistent in amounts and frequency, making it difficult to perform a meaningful evaluation of our current or past operating performance. We use these non-GAAP financial measures to evaluate ongoing operations, for internal planning and forecasting purposes, and to manage our business.
These non-GAAP financial measures are not intended to be considered in isolation from, as substitute for, or as superior to, the corresponding financial measures prepared in accordance with GAAP. There are limitations inherent in non-GAAP financial measures because they exclude charges and credits that are required to be included in a GAAP presentation, and do not present the full measure of our recorded costs against its revenue. In addition, our definition of the non-GAAP financial measures may differ from non-GAAP measures used by other companies.
About
Forward Looking Statements
This press release contains forward-looking statements within the meaning of federal securities laws, including statements relating to Guardant Health’s future results, regulatory approval for products or regarding the potential benefits and advantages of Guardant Health’s platforms, assays and tests, which involve risks and uncertainties that could cause Guardant Health’s actual results to differ materially from the anticipated results and expectations expressed in these forward-looking statements. These statements are based on current expectations, forecasts and assumptions, and actual outcomes and results could differ materially from these statements due to a number of factors. These and additional risks and uncertainties that could affect Guardant Health’s financial and operating results and cause actual results to differ materially from those indicated by the forward-looking statements made in this press release include those discussed under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operation” and elsewhere in its Annual Report on Form 10-K for the year ended
|
Condensed Consolidated Statements of Operations (unaudited) (in thousands, except per share data) |
|||||||||||||||
|
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
|
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
Revenue: |
|
|
|
|
|
|
|
||||||||
|
Precision oncology testing |
$ |
180,604 |
|
|
$ |
133,423 |
|
|
$ |
503,351 |
|
|
$ |
372,060 |
|
|
Development services and other |
|
10,872 |
|
|
|
9,607 |
|
|
|
33,851 |
|
|
|
36,834 |
|
|
Total revenue |
|
191,476 |
|
|
|
143,030 |
|
|
|
537,202 |
|
|
|
408,894 |
|
|
Costs and operating expenses: |
|
|
|
|
|
|
|
||||||||
|
Cost of precision oncology testing |
|
66,095 |
|
|
|
53,648 |
|
|
|
191,116 |
|
|
|
148,111 |
|
|
Cost of development services and other |
|
8,394 |
|
|
|
3,966 |
|
|
|
21,090 |
|
|
|
16,424 |
|
|
Research and development expense |
|
87,306 |
|
|
|
93,851 |
|
|
|
254,210 |
|
|
|
277,338 |
|
|
Sales and marketing expense |
|
97,880 |
|
|
|
68,934 |
|
|
|
260,172 |
|
|
|
216,100 |
|
|
General and administrative expense |
|
49,129 |
|
|
|
36,174 |
|
|
|
128,243 |
|
|
|
118,135 |
|
|
Total costs and operating expenses |
|
308,804 |
|
|
|
256,573 |
|
|
|
854,831 |
|
|
|
776,108 |
|
|
Loss from operations |
|
(117,328 |
) |
|
|
(113,543 |
) |
|
|
(317,629 |
) |
|
|
(367,214 |
) |
|
Interest income |
|
13,257 |
|
|
|
11,690 |
|
|
|
42,038 |
|
|
|
21,477 |
|
|
Interest expense |
|
(646 |
) |
|
|
(644 |
) |
|
|
(1,936 |
) |
|
|
(1,933 |
) |
|
Other income (expense), net |
|
(3,007 |
) |
|
|
16,885 |
|
|
|
(47,272 |
) |
|
|
56,490 |
|
|
Loss before provision for income taxes |
|
(107,724 |
) |
|
|
(85,612 |
) |
|
|
(324,799 |
) |
|
|
(291,180 |
) |
|
Provision for income taxes |
|
30 |
|
|
|
490 |
|
|
|
568 |
|
|
|
1,226 |
|
|
Net loss |
$ |
(107,754 |
) |
|
$ |
(86,102 |
) |
|
$ |
(325,367 |
) |
|
$ |
(292,406 |
) |
|
Net loss per share, basic and diluted |
$ |
(0.88 |
) |
|
$ |
(0.73 |
) |
|
$ |
(2.66 |
) |
|
$ |
(2.66 |
) |
|
Weighted-average shares used in computing net loss per share, basic and diluted |
|
123,051 |
|
|
|
117,736 |
|
|
|
122,406 |
|
|
|
109,791 |
|
|
Condensed Consolidated Balance Sheets (unaudited) (in thousands, except share and per share data) |
|||||||
|
|
|
|
|
||||
|
ASSETS |
|
|
|
||||
|
Current assets: |
|
|
|
||||
|
Cash, cash equivalents and restricted cash |
$ |
688,368 |
|
|
$ |
1,133,537 |
|
|
Short-term marketable debt securities |
|
310,701 |
|
|
|
35,097 |
|
|
Accounts receivable, net |
|
88,465 |
|
|
|
88,783 |
|
|
Inventory, net |
|
72,298 |
|
|
|
61,948 |
|
|
Prepaid expenses and other current assets, net |
|
66,883 |
|
|
|
27,741 |
|
|
Total current assets |
|
1,226,715 |
|
|
|
1,347,106 |
|
|
Property and equipment, net |
|
125,169 |
|
|
|
145,096 |
|
|
Right-of-use assets, net |
|
144,964 |
|
|
|
157,616 |
|
|
Intangible assets, net |
|
7,251 |
|
|
|
8,979 |
|
|
|
|
3,290 |
|
|
|
3,290 |
|
|
Other assets, net |
|
31,338 |
|
|
|
124,334 |
|
|
Total Assets |
$ |
1,538,727 |
|
|
$ |
1,786,421 |
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
||||
|
Current liabilities: |
|
|
|
||||
|
Accounts payable |
$ |
15,473 |
|
|
$ |
51,741 |
|
|
Accrued compensation |
|
80,647 |
|
|
|
72,736 |
|
|
Accrued expenses |
|
71,671 |
|
|
|
63,475 |
|
|
Deferred revenue |
|
29,554 |
|
|
|
17,965 |
|
|
Total current liabilities |
|
197,345 |
|
|
|
205,917 |
|
|
Convertible senior notes, net |
|
1,141,901 |
|
|
|
1,139,966 |
|
|
Long-term operating lease liabilities |
|
170,131 |
|
|
|
185,848 |
|
|
Other long-term liabilities |
|
89,446 |
|
|
|
96,006 |
|
|
Total Liabilities |
|
1,598,823 |
|
|
|
1,627,737 |
|
|
Stockholders’ equity: |
|
|
|
||||
|
Common stock, par value of |
|
1 |
|
|
|
1 |
|
|
Additional paid-in capital |
|
2,410,416 |
|
|
|
2,304,220 |
|
|
Accumulated other comprehensive loss |
|
(3,284 |
) |
|
|
(3,675 |
) |
|
Accumulated deficit |
|
(2,467,229 |
) |
|
|
(2,141,862 |
) |
|
Total Stockholders’ (Deficit) Equity |
|
(60,096 |
) |
|
|
158,684 |
|
|
Total Liabilities and Stockholders’ (Deficit) Equity |
$ |
1,538,727 |
|
|
$ |
1,786,421 |
|
|
Reconciliation of Selected GAAP Measures to Non-GAAP Measures (unaudited) (in thousands, except per share data) |
|||||||||||||||
|
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
|
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP cost of precision oncology testing |
$ |
66,095 |
|
|
$ |
53,648 |
|
|
$ |
191,116 |
|
|
$ |
148,111 |
|
|
Amortization of intangible assets |
|
(151 |
) |
|
|
(151 |
) |
|
|
(450 |
) |
|
|
(448 |
) |
|
Stock-based compensation expense and related employer payroll tax payments |
|
(1,505 |
) |
|
|
(1,120 |
) |
|
|
(4,092 |
) |
|
|
(3,563 |
) |
|
Non-GAAP cost of precision oncology testing |
$ |
64,439 |
|
|
$ |
52,377 |
|
|
$ |
186,574 |
|
|
$ |
144,100 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP cost of development services and other |
$ |
8,394 |
|
|
$ |
3,966 |
|
|
$ |
21,090 |
|
|
$ |
16,424 |
|
|
Amortization of intangible assets |
|
— |
|
|
|
(201 |
) |
|
|
(267 |
) |
|
|
(603 |
) |
|
Stock-based compensation expense and related employer payroll tax payments |
|
(2,412 |
) |
|
|
(437 |
) |
|
|
(3,409 |
) |
|
|
(1,391 |
) |
|
Non-GAAP cost of development services and other |
$ |
5,982 |
|
|
$ |
3,328 |
|
|
$ |
17,414 |
|
|
$ |
14,430 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP gross profit |
$ |
116,987 |
|
|
$ |
85,416 |
|
|
$ |
324,996 |
|
|
$ |
244,359 |
|
|
Amortization of intangible assets |
|
151 |
|
|
|
352 |
|
|
|
717 |
|
|
|
1,051 |
|
|
Stock-based compensation expense and related employer payroll tax payments |
|
3,917 |
|
|
|
1,557 |
|
|
|
7,501 |
|
|
|
4,954 |
|
|
Non-GAAP gross profit |
$ |
121,055 |
|
|
$ |
87,325 |
|
|
$ |
333,214 |
|
|
$ |
250,364 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP cost of screening |
$ |
5,320 |
|
|
$ |
2,992 |
|
|
$ |
12,108 |
|
|
$ |
10,023 |
|
|
Amortization of intangible assets |
|
— |
|
|
|
(201 |
) |
|
|
(267 |
) |
|
|
(603 |
) |
|
Stock-based compensation expense and related employer payroll tax payments |
|
(2,412 |
) |
|
|
(437 |
) |
|
|
(3,409 |
) |
|
|
(1,391 |
) |
|
Non-GAAP cost of screening |
$ |
2,908 |
|
|
$ |
2,354 |
|
|
$ |
8,432 |
|
|
$ |
8,029 |
|
|
Non-GAAP gross profit excluding cost of screening |
$ |
123,963 |
|
|
$ |
89,679 |
|
|
$ |
341,646 |
|
|
$ |
258,393 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP research and development expense |
$ |
87,306 |
|
|
$ |
93,851 |
|
|
$ |
254,210 |
|
|
$ |
277,338 |
|
|
Stock-based compensation expense and related employer payroll tax payments |
|
(18,750 |
) |
|
|
(8,611 |
) |
|
|
(38,815 |
) |
|
|
(25,877 |
) |
|
Contingent consideration |
|
(190 |
) |
|
|
(531 |
) |
|
|
(675 |
) |
|
|
(1,632 |
) |
|
Non-GAAP research and development expense |
$ |
68,366 |
|
|
$ |
84,709 |
|
|
$ |
214,720 |
|
|
$ |
249,829 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP sales and marketing expense |
$ |
97,880 |
|
|
$ |
68,934 |
|
|
$ |
260,172 |
|
|
$ |
216,100 |
|
|
Stock-based compensation expense and related employer payroll tax payments |
|
(13,287 |
) |
|
|
(5,137 |
) |
|
|
(27,874 |
) |
|
|
(18,657 |
) |
|
Non-GAAP sales and marketing expense |
$ |
84,593 |
|
|
$ |
63,797 |
|
|
$ |
232,298 |
|
|
$ |
197,443 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP general and administrative expense |
$ |
49,129 |
|
|
$ |
36,174 |
|
|
$ |
128,243 |
|
|
$ |
118,135 |
|
|
Amortization of intangible assets |
|
(340 |
) |
|
|
(339 |
) |
|
|
(1,011 |
) |
|
|
(1,006 |
) |
|
Stock-based compensation expense and related employer payroll tax payments |
|
(14,068 |
) |
|
|
(6,794 |
) |
|
|
(30,891 |
) |
|
|
(18,017 |
) |
|
Contingent consideration |
|
(340 |
) |
|
|
(220 |
) |
|
|
(760 |
) |
|
|
(230 |
) |
|
Non-GAAP general and administrative expense |
$ |
34,381 |
|
|
$ |
28,821 |
|
|
$ |
95,581 |
|
|
$ |
98,882 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP loss from operations |
$ |
(117,328 |
) |
|
$ |
(113,543 |
) |
|
$ |
(317,629 |
) |
|
$ |
(367,214 |
) |
|
Amortization of intangible assets |
|
491 |
|
|
|
691 |
|
|
|
1,728 |
|
|
|
2,057 |
|
|
Stock-based compensation expense and related employer payroll tax payments |
|
50,022 |
|
|
|
22,099 |
|
|
|
105,081 |
|
|
|
67,505 |
|
|
Contingent consideration |
|
530 |
|
|
|
751 |
|
|
|
1,435 |
|
|
|
1,862 |
|
|
Non-GAAP loss from operations |
$ |
(66,285 |
) |
|
$ |
(90,002 |
) |
|
$ |
(209,385 |
) |
|
$ |
(295,790 |
) |
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP net loss |
$ |
(107,754 |
) |
|
$ |
(86,102 |
) |
|
$ |
(325,367 |
) |
|
$ |
(292,406 |
) |
|
Amortization of intangible assets |
|
491 |
|
|
|
691 |
|
|
|
1,728 |
|
|
|
2,057 |
|
|
Stock-based compensation expense and related employer payroll tax payments |
|
50,022 |
|
|
|
22,099 |
|
|
|
105,081 |
|
|
|
67,505 |
|
|
Contingent consideration |
|
530 |
|
|
|
751 |
|
|
|
1,435 |
|
|
|
1,862 |
|
|
Unrealized and realized losses (gains) on marketable equity securities |
|
1,686 |
|
|
|
(16,634 |
) |
|
|
47,225 |
|
|
|
(84,513 |
) |
|
Impairment of non-marketable equity securities and other related assets |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
29,054 |
|
|
Non-GAAP net loss |
$ |
(55,025 |
) |
|
$ |
(79,195 |
) |
|
$ |
(169,898 |
) |
|
$ |
(276,441 |
) |
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP net loss per share, basic and diluted |
$ |
(0.88 |
) |
|
$ |
(0.73 |
) |
|
$ |
(2.66 |
) |
|
$ |
(2.66 |
) |
|
Non-GAAP net loss per share, basic and diluted |
$ |
(0.45 |
) |
|
$ |
(0.67 |
) |
|
$ |
(1.39 |
) |
|
$ |
(2.52 |
) |
|
Weighted-average shares used in computing GAAP and Non-GAAP net loss per share, basic and diluted |
|
123,051 |
|
|
|
117,736 |
|
|
|
122,406 |
|
|
|
109,791 |
|
|
Reconciliation of GAAP Net Loss to Adjusted EBITDA (unaudited) (in thousands) |
|||||||||||||||
|
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
|
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP net loss |
$ |
(107,754 |
) |
|
$ |
(86,102 |
) |
|
$ |
(325,367 |
) |
|
$ |
(292,406 |
) |
|
Interest income |
|
(13,257 |
) |
|
|
(11,690 |
) |
|
|
(42,038 |
) |
|
|
(21,477 |
) |
|
Interest expense |
|
646 |
|
|
|
644 |
|
|
|
1,936 |
|
|
|
1,933 |
|
|
Other expense (income), net |
|
3,007 |
|
|
|
(16,885 |
) |
|
|
47,272 |
|
|
|
(56,490 |
) |
|
Provision for income taxes |
|
30 |
|
|
|
490 |
|
|
|
568 |
|
|
|
1,226 |
|
|
Depreciation and amortization |
|
10,598 |
|
|
|
11,037 |
|
|
|
31,933 |
|
|
|
32,013 |
|
|
Stock-based compensation expense and related employer payroll tax payments |
|
50,022 |
|
|
|
22,099 |
|
|
|
105,081 |
|
|
|
67,505 |
|
|
Contingent consideration |
|
530 |
|
|
|
751 |
|
|
|
1,435 |
|
|
|
1,862 |
|
|
Adjusted EBITDA |
$ |
(56,178 |
) |
|
$ |
(79,656 |
) |
|
$ |
(179,180 |
) |
|
$ |
(265,834 |
) |
|
Reconciliation of Free Cash Flow to (unaudited) (in thousands) |
|||||||||||||||
|
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
|
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
Net cash used in operating activities |
$ |
(51,059 |
) |
|
$ |
(77,791 |
) |
|
$ |
(175,345 |
) |
|
$ |
(246,247 |
) |
|
Purchases of property and equipment |
|
(4,199 |
) |
|
|
(2,372 |
) |
|
|
(16,210 |
) |
|
|
(16,409 |
) |
|
Free cash flow |
$ |
(55,258 |
) |
|
$ |
(80,163 |
) |
|
$ |
(191,555 |
) |
|
$ |
(262,656 |
) |
View source version on businesswire.com: https://www.businesswire.com/news/home/20241106173129/en/
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