Revenue growth of 29% driven by strong clinical
and biopharma volume and Guardant360 ASP tailwinds
Shield approved by FDA as primary option for
CRC screening and is commercially available in U.S.
Guardant Health, Inc. (Nasdaq: GH), a leading precision oncology
company, today reported financial results for the quarter ended
June 30, 2024.
Second Quarter 2024 Financial Highlights
- Revenue of $177.2 million for the second quarter of 2024, an
increase of 29% over the second quarter of 2023
- Reported 49,400 tests to clinical customers and 10,475 tests to
biopharmaceutical customers in the second quarter of 2024,
representing increases of 14% and 56%, respectively, over the
second quarter of 2023
- Raised 2024 annual guidance for revenue to a new range of $690
to $700 million, representing growth of 22% to 24%
Recent Operating Highlights
- Received FDA approval for Shield as a first-line CRC screening
option and initiated commercial launch of Shield IVD
- Shield now meets the requirements for Medicare coverage for 45
million eligible individuals
- Launched major upgrade of Guardant360 on Smart Liquid Biopsy
platform, further extending best-in-class performance
- Upgraded Guardant360 TissueNext to a 498 gene panel to identify
more treatment options for patients with advanced cancer
- Publication of COSMOS study data in Clinical Cancer Research
further validates Reveal for MRD CRC surveillance testing in Stage
II and III patients
“We had another strong quarter driven by solid volume growth,
particularly for biopharma, and continued improvements to
Guardant360 reimbursement,” said Helmy Eltoukhy, co-founder and
co-CEO. “We also reached major milestones across our oncology
business with the upgrades of Guardant360 onto our Smart Liquid
Biopsy platform, a revolutionary platform that combines genomics
with epigenomics, and of Guardant360 TissueNext to identify more
treatment options for patients with advanced cancer. Additionally,
our COSMOS study was recently published in Clinical Cancer Research
and submitted to MolDx for Medicare reimbursement of CRC
surveillance. We look forward to continuing this momentum
throughout the remainder of the year as we deliver on our mission
of giving us all more time free from cancer.”
“FDA approval of our Shield blood test for first-line colorectal
cancer screening is a huge victory for Guardant and patients,” said
AmirAli Talasaz, co-founder and co-CEO. “Commercial launch of
Shield and CMS coverage make our blood-based screening option
accessible to more than 45 million Medicare beneficiaries. Shield
offers a more pleasant way to stay up to date with colorectal
cancer screening and detect the disease early, when it is more
easily treated.”
Second Quarter 2024 Financial Results
Revenue was $177.2 million for the second quarter of 2024, a 29%
increase from $137.2 million for the corresponding prior year
period. Precision oncology revenue grew 33%, to $166.5 million for
the second quarter of 2024, from $125.2 million for the
corresponding prior year period, driven by an increase in clinical
and biopharma testing volume, which grew 14% and 56%, respectively,
over the prior year period. The increase in precision oncology
revenue was also attributable to an increase in reimbursement for
our tests, due to an increase in Medicare reimbursement for our
Guardant360 LDT test to $5,000, effective January 1, 2024; and an
increase in both Medicare Advantage and commercial payer
reimbursement. Development services and other revenue was $10.7
million for the second quarter of 2024, compared to $11.9 million
for the corresponding prior year period.
Gross profit, or total revenue less cost of precision oncology
testing and cost of development services and other, was $104.8
million for the second quarter of 2024, an increase of $21.5
million from $83.3 million for the corresponding prior year period.
Gross margin, or gross profit divided by total revenue, was 59%, as
compared to 61% for the corresponding prior year period. Precision
oncology gross margin was 61% in the second quarter of 2024, as
compared to 61% in the prior year period. Development services and
other gross margin was 37% in the second quarter of 2024, as
compared to 62% in the prior year period.
Non-GAAP gross profit was $106.8 million for the second quarter
of 2024, an increase of $21.5 million, from $85.4 million for the
corresponding prior year period. Non-GAAP gross margin was 60% for
the second quarter of 2024, as compared to 62% for the
corresponding prior year period.
Non-GAAP gross profit excluding screening was $109.7 million for
the second quarter of 2024, an increase of $22.1 million, from
$87.6 million for the corresponding prior year period. Non-GAAP
gross margin excluding screening was 62% for the second quarter of
2024, as compared to 64% for the corresponding prior year
period.
Operating expenses were $205.4 million for the second quarter of
2024, as compared to $202.9 million for the corresponding prior
year period. Non-GAAP operating expenses were $178.8 million for
the second quarter of 2024, as compared to $180.5 million for the
corresponding prior year period.
Net loss was $102.6 million for the second quarter of 2024, as
compared to $72.8 million for the corresponding prior year period.
Net loss per share was $0.84 for the second quarter of 2024, as
compared to $0.67 for the corresponding prior year period. The
year-over-year increase in net loss is primarily due to a $79.5
million increase in unrealized losses recorded for our equity
security investment, partially offset by a $23.6 million impairment
for our non-marketable equity security investments and other
related assets recorded during the corresponding prior year period,
a $19.0 million year over year improvement in loss from operations,
and a $7.2 million increase in interest income.
Non-GAAP net loss was $58.5 million for the second quarter of
2024, as compared to $88.7 million for the corresponding prior year
period. Non-GAAP net loss per share was $0.48 for the second
quarter of 2024, as compared to $0.82 for the corresponding prior
year period.
Adjusted EBITDA loss was $61.9 million for the second quarter of
2024, as compared to a $85.2 million loss for the corresponding
prior year period.
Free cash flow for the second quarter of 2024 was $(99.1)
million, as compared to $(100.5) million for the corresponding
prior year period. Cash, cash equivalents, and restricted cash were
$1.0 billion as of June 30, 2024.
2024 Guidance
Guardant Health now expects full year 2024 revenue excluding
screening to be in the range of $690 to $700 million, representing
growth of 22% to 24% compared to full year 2023. This compares to
the prior range of $675 to $685 million, representing growth of 20%
to 21%. Guardant Health continues to expect full year 2024 non-GAAP
gross margin excluding screening to be in the range of 61% to 63%
and total non-GAAP operating expenses to be in the range of $720 to
$730 million, representing a flat to 1% decrease compared to 2023.
Guardant Health continues to expect free cash flow to be in the
range of $(275) to $(285) million in 2024, representing an
improvement of $60 million to $70 million compared to 2023.
Webcast Information
Guardant Health will host a conference call to discuss the
second quarter 2024 financial results after market close on
Wednesday, August 7, 2024 at 1:30 pm Pacific Time / 4:30 pm Eastern
Time. A webcast of the conference call can be accessed at
http://investors.guardanthealth.com. The webcast will be archived
and available for replay for at least 90 days after the event.
Non-GAAP Measures
Guardant Health has presented in this release certain financial
information in accordance with U.S. Generally Accepted Accounting
Principles (GAAP) and also on a non-GAAP basis, including non-GAAP
cost of precision oncology testing, non-GAAP cost of development
services and other, non-GAAP cost of screening, non-GAAP gross
profit, non-GAAP gross profit excluding cost of screening, non-GAAP
research and development expense, non-GAAP sales and marketing
expense, non-GAAP general and administrative expense, non-GAAP loss
from operations, non-GAAP net loss, non-GAAP net loss per share,
basic and diluted, adjusted EBITDA, and free cash flow.
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, fair value adjustments 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 Guardant Health
Guardant Health is a leading precision oncology company focused
on guarding wellness and giving every person more time free from
cancer. Founded in 2012, Guardant is transforming patient care and
accelerating new cancer therapies by providing critical insights
into what drives disease through its advanced blood and tissue
tests, real-world data and AI analytics. Guardant tests help
improve outcomes across all stages of care, including screening to
find cancer early, monitoring for recurrence in early-stage cancer,
and treatment selection for patients with advanced cancer. For more
information, visit guardanthealth.com and follow the company on
LinkedIn, X (Twitter) and Facebook.
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 December 31, 2023, and any
current and periodic reports filed with or furnished to the
Securities and Exchange Commission thereafter. The forward-looking
statements in this press release are based on information available
to Guardant Health as of the date hereof, and Guardant Health
disclaims any obligation to update any forward-looking statements
provided to reflect any change in its expectations or any change in
events, conditions, or circumstances on which any such statement is
based, except as required by law. These forward-looking statements
should not be relied upon as representing Guardant Health’s views
as of any date subsequent to the date of this press release.
Guardant Health, Inc.
Condensed Consolidated
Statements of Operations
(unaudited)
(in thousands, except per
share data)
Three Months Ended June
30,
Six Months Ended June
30,
2024
2023
2024
2023
Revenue:
Precision oncology testing
$
166,518
$
125,244
$
322,747
$
238,637
Development services and other
10,717
11,906
22,979
27,227
Total revenue
177,235
137,150
345,726
265,864
Costs and operating expenses:
Cost of precision oncology testing
65,715
49,357
125,021
94,463
Cost of development services and other
6,706
4,491
12,696
12,458
Research and development expense
83,102
90,359
166,904
183,487
Sales and marketing expense
81,867
71,043
162,292
147,166
General and administrative expense
40,463
41,516
79,114
81,961
Total costs and operating expenses
277,853
256,766
546,027
519,535
Loss from operations
(100,618
)
(119,616
)
(200,301
)
(253,671
)
Interest income
13,913
6,727
28,781
9,787
Interest expense
(645
)
(645
)
(1,290
)
(1,289
)
Other income (expense), net
(15,145
)
41,259
(44,265
)
39,605
Loss before provision for income taxes
(102,495
)
(72,275
)
(217,075
)
(205,568
)
Provision for income taxes
133
496
538
736
Net loss
$
(102,628
)
$
(72,771
)
$
(217,613
)
$
(206,304
)
Net loss per share, basic and diluted
$
(0.84
)
$
(0.67
)
$
(1.78
)
$
(1.95
)
Weighted-average shares used in computing
net loss per share, basic and diluted
122,447
108,808
122,080
105,752
Guardant Health, Inc.
Condensed Consolidated Balance
Sheets
(unaudited)
(in thousands, except share
and per share data)
June 30, 2024
December 31, 2023
ASSETS
Current assets:
Cash, cash equivalents and restricted
cash
$
1,035,239
$
1,133,537
Short-term marketable debt securities
—
35,097
Accounts receivable, net
100,519
88,783
Inventory, net
66,984
61,948
Prepaid expenses and other current assets,
net
87,232
27,741
Total current assets
1,289,974
1,347,106
Property and equipment, net
132,317
145,096
Right-of-use assets, net
146,111
157,616
Intangible assets, net
7,742
8,979
Goodwill
3,290
3,290
Other assets, net
29,906
124,334
Total Assets
$
1,609,340
$
1,786,421
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities:
Accounts payable
$
42,447
$
51,741
Accrued compensation
59,067
72,736
Accrued expenses
70,680
63,475
Deferred revenue
29,375
17,965
Total current liabilities
201,569
205,917
Convertible senior notes, net
1,141,256
1,139,966
Long-term operating lease liabilities
172,194
185,848
Other long-term liabilities
95,934
96,006
Total Liabilities
1,610,953
1,627,737
Stockholders’ equity:
Common stock, par value of $0.00001 per
share; 350,000,000 shares authorized as of June 30, 2024 and
December 31, 2023; 122,969,580 and 121,629,861 shares issued and
outstanding as of June 30, 2024 and December 31, 2023,
respectively
1
1
Additional paid-in capital
2,363,501
2,304,220
Accumulated other comprehensive loss
(5,640
)
(3,675
)
Accumulated deficit
(2,359,475
)
(2,141,862
)
Total Stockholders’ (Deficit) Equity
(1,613
)
158,684
Total Liabilities and Stockholders’
(Deficit) Equity
$
1,609,340
$
1,786,421
Guardant Health, Inc.
Reconciliation of Selected
GAAP Measures to Non-GAAP Measures
(unaudited)
(in thousands, except per
share data)
Three Months Ended June
30,
Six Months Ended June
30,
2024
2023
2024
2023
GAAP cost of precision oncology
testing
$
65,715
$
49,357
$
125,021
$
94,463
Amortization of intangible assets
(150
)
(149
)
(299
)
(297
)
Stock-based compensation expense and
related employer payroll tax payments
(1,309
)
(1,225
)
(2,587
)
(2,443
)
Non-GAAP cost of precision oncology
testing
$
64,256
$
47,983
$
122,135
$
91,723
GAAP cost of development services and
other
$
6,706
$
4,491
$
12,696
$
12,458
Amortization of intangible assets
(67
)
(201
)
(267
)
(402
)
Stock-based compensation expense and
related employer payroll tax payments
(498
)
(478
)
(997
)
(954
)
Non-GAAP cost of development services
and other
$
6,141
$
3,812
$
11,432
$
11,102
GAAP gross profit
$
104,814
$
83,302
$
208,009
$
158,943
Amortization of intangible assets
217
350
566
699
Stock-based compensation expense and
related employer payroll tax payments
1,807
1,703
3,584
3,397
Non-GAAP gross profit
$
106,838
$
85,355
$
212,159
$
163,039
GAAP cost of screening
$
3,459
$
2,966
$
6,788
$
7,031
Amortization of intangible assets
(67
)
(201
)
(267
)
(402
)
Stock-based compensation expense and
related employer payroll tax payments
(498
)
(478
)
(997
)
(954
)
Non-GAAP cost of screening
$
2,894
$
2,287
$
5,524
$
5,675
Non-GAAP gross profit excluding cost of
screening
$
109,732
$
87,642
$
217,683
$
168,714
GAAP research and development
expense
$
83,102
$
90,359
$
166,904
$
183,487
Stock-based compensation expense and
related employer payroll tax payments
(10,001
)
(8,518
)
(20,065
)
(17,266
)
Contingent consideration
(110
)
(531
)
(485
)
(1,101
)
Non-GAAP research and development
expense
$
72,991
$
81,310
$
146,354
$
165,120
GAAP sales and marketing
expense
$
81,867
$
71,043
$
162,292
$
147,166
Stock-based compensation expense and
related employer payroll tax payments
(7,258
)
(5,977
)
(14,587
)
(13,520
)
Non-GAAP sales and marketing
expense
$
74,609
$
65,066
$
147,705
$
133,646
GAAP general and administrative
expense
$
40,463
$
41,516
$
79,114
$
81,961
Amortization of intangible assets
(335
)
(336
)
(671
)
(667
)
Stock-based compensation expense and
related employer payroll tax payments
(8,659
)
(6,755
)
(16,823
)
(11,223
)
Contingent consideration
(300
)
(310
)
(420
)
(10
)
Non-GAAP general and administrative
expense
$
31,169
$
34,115
$
61,200
$
70,061
GAAP loss from operations
$
(100,618
)
$
(119,616
)
$
(200,301
)
$
(253,671
)
Amortization of intangible assets
552
686
1,237
1,366
Stock-based compensation expense and
related employer payroll tax payments
27,725
22,953
55,059
45,406
Contingent consideration
410
841
905
1,111
Non-GAAP loss from operations
$
(71,931
)
$
(95,136
)
$
(143,100
)
$
(205,788
)
GAAP net loss
$
(102,628
)
$
(72,771
)
$
(217,613
)
$
(206,304
)
Amortization of intangible assets
552
686
1,237
1,366
Stock-based compensation expense and
related employer payroll tax payments
27,725
22,953
55,059
45,406
Contingent consideration
410
841
905
1,111
Unrealized losses (gains) on marketable
equity securities
15,485
(63,997
)
45,539
(67,879
)
Impairment of non-marketable equity
securities and other related assets
—
23,569
—
29,054
Non-GAAP net loss
$
(58,456
)
$
(88,719
)
$
(114,873
)
$
(197,246
)
GAAP net loss per share, basic and
diluted
$
(0.84
)
$
(0.67
)
$
(1.78
)
$
(1.95
)
Non-GAAP net loss per share, basic and
diluted
$
(0.48
)
$
(0.82
)
$
(0.94
)
$
(1.87
)
Weighted-average shares used in
computing GAAP and Non-GAAP net loss per share, basic and
diluted
122,447
108,808
122,080
105,752
Reconciliation of GAAP Net
Loss to Adjusted EBITDA
(unaudited)
(in thousands)
Three Months Ended June
30,
Six Months Ended June
30,
2024
2023
2024
2023
GAAP net loss
$
(102,628
)
$
(72,771
)
$
(217,613
)
$
(206,304
)
Interest income
(13,913
)
(6,727
)
(28,781
)
(9,787
)
Interest expense
645
645
1,290
1,289
Other expense (income), net
15,145
(41,259
)
44,265
(39,605
)
Provision for income taxes
133
496
538
736
Depreciation and amortization
10,623
10,631
21,335
20,976
Stock-based compensation expense and
related employer payroll tax payments
27,725
22,953
55,059
45,406
Contingent consideration
410
841
905
1,111
Adjusted EBITDA
$
(61,860
)
$
(85,191
)
$
(123,002
)
$
(186,178
)
Reconciliation of Free Cash
Flow to Net Cash Used in Operating Activities
(unaudited)
(in thousands)
Three Months Ended June
30,
Six Months Ended June
30,
2024
2023
2024
2023
Net cash used in operating activities
$
(94,002
)
$
(94,015
)
$
(124,286
)
$
(168,456
)
Purchase of property and equipment
(5,077
)
(6,513
)
(12,011
)
(14,037
)
Free cash flow
$
(99,079
)
$
(100,528
)
$
(136,297
)
$
(182,493
)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240807054615/en/
Investor Contact: Zarak
Khurshid investors@guardanthealth.com
Media Contact: Melissa
Marasco press@guardanthealth.com +1 650-647-3711
Guardant Health (NASDAQ:GH)
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