Guardant Health Reports First Quarter 2024 Financial Results and Increases 2024 Revenue Guidance

Original from: Guardant Health

Guardant Health, Inc. (Nasdaq: GH), a leading precision oncology company, today reported financial results for the quarter ended March 31, 2024.

First Quarter 2024 Financial Highlights

·    Revenue of $168.5 million for the first quarter of 2024, an increase of 31% over the first quarter of 2023

·    Reported 46,900 tests to clinical customers and 8,450 tests to biopharmaceutical customers in the first quarter of 2024, representing increases of 20% and 37%, respectively, over the first quarter of 2023

·    Reduced free cash flow to $(37.2) million in the first quarter of 2024, compared to $(82.0) million in the prior year

·    Raised 2024 annual guidance for revenue to a new range of $675 to $685 million, representing growth of 20% to 21%

·    Improved annual free cash flow guidance to $(275) to $(285) million, a reduction of $60 to $70 million compared to 2023

Recent Operating Highlights

·    Validated the strength and quality of ECLIPSE clinical data with the study publication in The New England Journal of Medicine

·    Launched new service at The Royal Marsden to test advanced NSCLC patients in England through an expanded NHS study

·    Presented new data demonstrating the value of epigenomic analysis and methylation sequencing using the Smart Liquid Biopsy platform at the 2024 AACR Annual Meeting

·    Surpassed 500 peer-reviewed publications highlighting Guardant Health technology in scientific literature

“We started the year off very strongly with first quarter revenue growing 31%, driven by both solid volume growth and significant improvements to Guardant360 reimbursement,” said Helmy Eltoukhy, co-founder and co-CEO. “In addition to strong topline performance, this was the first quarter of generating positive cash flow in our Therapy Selection business. We also recently surpassed a significant milestone with over 500 peer-reviewed publications highlighting our technology in scientific literature, demonstrating the impact our innovative suite of products have on both patients and the scientific community.”

“The publication of ECLIPSE data in The New England Journal of Medicine, one of the world’s leading medical journals, underscores the quality of our clinical data,” said AmirAli Talasaz, co-founder and co-CEO. “Our team has worked incredibly hard and is now well-prepared for the upcoming FDA Advisory Committee review on May 23. We are eagerly anticipating the launch of Shield IVD shortly after the expected FDA approval in 2024 and are confident this test is well positioned for rapid adoption.”

First Quarter 2024 Financial Results

Revenue was $168.5 million for the first quarter of 2024, a 31% increase from $128.7 million for the corresponding prior year period. Precision oncology revenue grew 38%, to $156.2 million for the first quarter of 2024, from $113.4 million for the corresponding prior year period, driven by an increase in clinical and biopharma testing volume, which grew 20% and 37%, 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 the Medicare reimbursement rate for our Guardant360 LDT test to $5,000, effective January 1, 2024, and an increase in reimbursement received from commercial payers. Development services and other revenue was $12.3 million for the first quarter of 2024, compared to $15.3 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 $103.2 million for the first quarter of 2024, an increase of $27.6 million from $75.6 million for the corresponding prior year period. Gross margin, or gross profit divided by total revenue, was 61%, as compared to 59% for the corresponding prior year period. Precision oncology gross margin was 62% in the first quarter of 2024, as compared to 60% in the prior year period. Development services and other gross margin was 51% in the first quarter of 2024, as compared to 48% in the prior year period.

Non-GAAP gross profit was $105.3 million for the first quarter of 2024, an increase of $27.6 million, from $77.7 million for the corresponding prior year period. Non-GAAP gross margin was 63% for the first quarter of 2024, as compared to 60% for the corresponding prior year period.

Non-GAAP gross profit excluding screening was $108.0 million for the first quarter of 2024, an increase of $26.9 million, from $81.1 million for the corresponding prior year period. Non-GAAP gross margin excluding screening was 64% for the first quarter of 2024, as compared to 63% for the corresponding prior year period.

Operating expenses were $202.9 million for the first quarter of 2024, as compared to $209.7 million for the corresponding prior year period. Non-GAAP operating expenses were $176.5 million for the first quarter of 2024, as compared to $188.3 million for the corresponding prior year period.

Net loss was $115.0 million for the first quarter of 2024, as compared to $133.5 million for the corresponding prior year period. Net loss per share was $0.94 for the first quarter of 2024, as compared to $1.30 for the corresponding prior year period. The year-over-year decrease in net loss is primarily due to a $34.4 million year over year improvement in loss from operations, and a $11.8 million increase in interest income, partially offset by a $33.9 million increase in unrealized losses recorded for our investment in Lunit, Inc.

Non-GAAP net loss was $56.4 million for the first quarter of 2024, as compared to $108.5 million for the corresponding prior year period. Non-GAAP net loss per share was $0.46 for the first quarter of 2024, as compared to $1.06 for the corresponding prior year period.

Adjusted EBITDA loss was $61.1 million for the first quarter of 2024, as compared to a $101.0 million loss for the corresponding prior year period.

Free cash flow for the first quarter of 2024 was $(37.2) million, as compared to $(82.0) million for the corresponding prior year period. Cash, cash equivalents, and restricted cash were $1.1 billion as of March 31, 2024.

2024 Guidance

Guardant Health now expects full year 2024 revenue excluding screening to be in the range of $675 to $685 million, representing growth of 20% to 21% compared to full year 2023 This compares to the prior range of $655 to $670 million, representing growth of 16% to 19%. Guardant Health now expects full year 2024 non-GAAP gross margin excluding screening to be in the range of 61% to 63%, compared to the prior range of 60% to 62%. Guardant Health now expects total non-GAAP operating expenses to be in the range of $720 to $730 million, representing a flat to 1% decrease compared to 2023, an improvement compared to the prior range of $740 to $750 million. Guardant Health now expects free cash flow to be in the range of $(275) to $(285) million in 2024, an improvement compared to the prior range of $(320) to $(330) million.

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Source: Guardant Health Reports First Quarter 2024 Financial Results and Increases 2024 Revenue Guidance