On February 24, 2025 Veracyte, Inc. (Nasdaq: VCYT) reported financial results for the fourth quarter and full year ended December 31, 2024 (Press release, Veracyte, FEB 24, 2025, View Source [SID1234650483]).

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

"I’m incredibly proud of what our team accomplished in 2024," said Marc Stapley, Veracyte’s chief executive officer. "We ended the year with exceptional performance, delivering record revenue in Q4 and achieving our 10th consecutive quarter of 20% or greater testing revenue growth. Looking ahead to 2025, we see significant opportunities for Decipher and Afirma to impact more patients and drive growth for Veracyte. We are focused on moving forward with our exciting portfolio of strategic growth drivers while maintaining the financial discipline that has been core to our success."

Key Fourth Quarter 2024 Financial Highlights

For the three-month period ended December 31, 2024, as compared to the same period in 2023:

Increased total revenue by 21% to $118.6 million and testing revenue by 24% to $112.2 million.
Increased total volume by 22% to 41,271 tests and testing volume by 25% to 39,107 tests.
Grew Decipher revenue by 44% and Afirma revenue by 4%.
Grew Decipher volume by 45% to more than 22,400 tests and Afirma volume by 8% to more than 16,300 tests.
Increased net income to $5.1 million, or 4.3% of revenue, and delivered adjusted EBITDA of $26.1 million, or 22.0% of revenue.
Generated $24.5 million of cash from operations.
Key Full Year 2024 Financial Highlights

For the twelve-month period ended December 31, 2024, as compared to the same period in 2023:

Increased total revenue by 23% to $445.8 million and testing revenue by 28% to $419.0 million.
Increased total volume by 20% to 152,750 tests and testing volume by 23% to 142,925 tests.
Grew Decipher revenue by 43% and Afirma revenue by 14%.
Grew Decipher volume by 36% to more than 80,000 tests and Afirma volume by 12% to more than 60,000 tests.
Increased net income to $24.1 million, or 5.4% of revenue, and delivered adjusted EBITDA of $91.9 million, or 20.6% of revenue.
Generated $75.1 million of cash from operations to end the year with $289.4 million of cash, cash equivalents and short-term investments.
Key Business Highlights

Through Level I evidence for the 22-Gene Genomic Classifier (GC) (Decipher), secured its position as the only gene expression test included in V1.2025 of the NCCN Clinical Practice Guidelines in Oncology (NCCN Guidelines) for Prostate Cancer published in December 2024.1
Received approval from Molecular Diagnostic Services Program (MolDx) for the technical assessment submission for Decipher for use in the metastatic population.
Announced 17 Decipher-focused abstracts to be presented at the 2025 ASCO (Free ASCO Whitepaper) GU Symposium demonstrating the power of the Veracyte diagnostics platform and Veracyte’s commitment to continued leadership in supporting clinical research around urologic cancers.
Published our 2024 Environmental, Social and Governance Report.
1

NCCN = National Comprehensive Cancer Network (NCCN). Referenced with permission from the NCCN Clinical Practice Guidelines in Oncology (NCCN Guidelines) for Prostate Cancer v.1.2025. © National Comprehensive Cancer Network, Inc. 2024. All rights reserved. Accessed February 12, 2025. To view the most recent and complete version of the guideline, go online to NCCN.org. NCCN makes no warranties of any kind whatsoever regarding their content, use or application and disclaims any responsibility for their application or use in any way.

Fourth Quarter 2024 Financial Results

Total revenue for the fourth quarter of 2024 was $118.6 million, an increase of 21% compared to $98.2 million reported in the fourth quarter of 2023. Testing revenue was $112.2 million, an increase of 24% compared to $90.4 million in the fourth quarter of 2023, driven by the strong performance of our Decipher and Afirma tests. Product revenue was $3.0 million, a decrease of 18% compared to $3.7 million in the fourth quarter of 2023. Biopharmaceutical and other revenue was $3.5 million, a decrease of 17% compared to $4.1 million in the fourth quarter of 2023.

Total gross margin for the fourth quarter of 2024 was 66.4%, compared to 66.0% in the fourth quarter of 2023. Non-GAAP gross margin was 69.3%, compared to 70.6% in the fourth quarter of 2023.

Operating expenses were $74.6 million for the fourth quarter of 2024. Non-GAAP operating expenses were $57.9 million, flat compared to $57.9 million in the fourth quarter of 2023.

Net income for the fourth quarter of 2024 was $5.1 million, an improvement of 118% compared to the fourth quarter of 2023, representing 4.3% of revenue compared to (28.8%) in the same period in 2023. Diluted net earnings per common share was $0.06, an improvement of $0.45 compared to the fourth quarter of 2023. Non-GAAP diluted net earnings per common share was $0.36, an improvement of $0.15 compared to the fourth quarter of 2023. Net cash provided by operating activities in the fourth quarter of 2024 was $24.5 million, an improvement of $9.0 million compared to the same period in 2023.

Adjusted EBITDA for the fourth quarter of 2024 was $26.1 million, an improvement of 76% compared to the fourth quarter of 2023, representing 22.0% of revenue compared to 15.1% of revenue in the same period of 2023.

Full Year 2024 Financial Results

Total revenue for 2024 was $445.8 million, an increase of 23% compared to $361.1 million in 2023. Testing revenue was $419.0 million, an increase of 28% compared to $326.5 million in 2023, driven by the strong performance of our Decipher and Afirma tests. Product revenue was $13.7 million, a decrease of 12% compared to $15.6 million in 2023. Biopharmaceutical and other revenue was $13.2 million, a decrease of 30% compared to $18.9 million in 2023.

Total gross margin for the full year 2024 was 66.9%, compared to 63.6% in 2023. Non-GAAP gross margin was 70.0%, compared to 69.3% in 2023.

Operating expenses were $282.0 million for the full year 2024. Non-GAAP operating expenses grew 7% to $227.6 million compared to $212.5 million in 2023.

Net income for the full year 2024 was $24.1 million, an improvement of 132% compared to 2023, representing 5.4% of revenue compared to (20.6%) in 2023. Diluted net earnings per common share was $0.31, an improvement of $1.33 compared to 2023. Non-GAAP diluted net earnings per common share was $1.19, an improvement of $0.61 compared to 2023. Net cash provided by operating activities in 2024 was $75.1 million, an improvement of $30.9 million compared to 2023.

Adjusted EBITDA for the full year 2024 was $91.9 million, an improvement of 102% compared to 2023, representing 20.6% of revenue compared to 12.6% of revenue in 2023.

A reconciliation of GAAP to non-GAAP financial measures has been provided in the tables included in this press release. An explanation of these measures is also included below under the heading "Note Regarding Use of Non-GAAP Financial Measures."

Update on Marseille Operations

Veracyte is evaluating its ownership and operations of the company’s French subsidiary, Veracyte SAS, whose business is located in Marseille, France and includes Veracyte’s immune-oncology biopharma business, contract development and manufacturing, and support for Veracyte’s IVD development and manufacturing. Veracyte recently notified Veracyte SAS that, as sole shareholder of Veracyte SAS, it is considering no longer funding the French entity. Accordingly, Veracyte SAS will engage with its works council, as is required by French law, over the next few months.

Seeking external buyer(s) for a potential divestiture of all or part of the French entity’s activities is an option that is actively being explored. Without Veracyte Inc.’s continued funding or identification of a buyer for all or part of the Veracyte SAS assets, Veracyte SAS may be required to begin bankruptcy proceedings following its works council consultation period.

Management will provide further details on this process and its potential impact on Veracyte’s 2025 financial outlook during the conference call this afternoon.

2025 Financial Outlook

The company expects 2025 testing revenue to be in the range of $470 million to $480 million, or 12% to 15% year-over-year growth. Adjusting for the impact of the paused Envisia test, the guidance implies testing revenue growth of 14% to 16%. Given the number of variables impacting its Marseille, France operations, the company is not providing total company revenue guidance at this time and expects to provide its total revenue outlook for 2025 once there is more clarity on the timing and impact of the process underway.

The company also expects adjusted EBITDA as a percentage of revenue in 2025 to be approximately 21.6% compared to 20.6% in 2024.

The company is unable to provide a quantitative reconciliation of expected adjusted EBITDA as a percentage of revenue to the most directly comparable forward-looking GAAP measure, without unreasonable effort, because of the inherent difficulty in accurately forecasting the occurrence and financial impact of the various adjusting items necessary for such reconciliations that have not yet occurred, that are dependent on various factors, are out of the company’s control, or that cannot be reasonably predicted. Such adjustments include, but are not limited to, acquisition related expenses, and other adjustments. Any associated estimate of these items and their impact on GAAP performance for the guidance period could vary materially. For more information on the non-GAAP financial measures, please refer to the section titled "Note Regarding Use of Non-GAAP Financial Measures" at the end of this press release.

Conference Call and Webcast Details

Veracyte will host a conference call and webcast today at 4:30 p.m. Eastern Time to discuss the company’s financial results and provide a general business update. The conference call will be webcast live from the company’s website and will be available via the following link: View Source The webcast should be accessed 10 minutes prior to the conference call start time. A replay of the webcast will be available for one year following the conclusion of the live broadcast and will be accessible on the company’s website at View Source