Earnings call transcript Q1 2023

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Operator

Welcome to the NeoGenomics First Quarter 2023 Financial Results Conference Call and Webcast. At this time all participants are in listen only mode. Please note this call is being recorded, and an audio replay will be available on the Company's website. Kendra Sweeney, Vice President of Investor Relations, you may begin your conference.

Kendra Sweeney

Thank you, Paul. welcome NeoGenomics and results quarter everyone, call. afternoon, to first the financial Good to are officer. the Chief me discuss With today results and Sherman, Executive Jeff Chris Neo’s financial Officer Neo’s Smith,

available Additional the President Advanced of and Warren members Diagnostic, Enterprise Services, including President Clinical Harris, management are of of of Stone, Melody Vishal for team Operations. Sikri, Q&A, President

to This website presentation that slide referring to call the our is being on been simultaneously the posted webcast, at tab we ir.neogenomics.com. will be investors has

will we operational call, forward-looking this and during our two, Slide related on performance, outlook, our on our products regarding as projections, that effects future for our and make anticipated and for Starting statements outlooks strategies financial opportunities and results. our and such assumptions financial operating

that date on XX-Q we cause statements we judgments differ and important factors results such the to of to call us, or The the or materially, best to our in from contained forward-looking those the most statements. and SEC the factors other by XX-K, to and these our actual to and known recent you events results based that obligation reflect Form please X-K revise We suggested statements or actual could may of original with risks only currently caution made call during forward-looking our speak undertake differ this no materially that any of filed update identify refer statements.

measures measures issued measures, be financial GAAP in comparable in a not unlikely order the GAAP that referenced comparable we refer by considered are directly to as call, presented not this provide most to press involve this we measures financial to should Any considered the and alternative our measures to on GAAP financial non-GAAP to the GAAP be The in table during addition, financial be liquidity by financial performance, available non-GAAP should call afternoon. results. financial this an reconciled transparency other non-GAAP of are companies. required In to greater regarding certain provided release non operating to measures adjustments measure

turn Smith, of now the NeoGenomics. will I over Executive to Chief Officer call Chris

Chris Smith

Thanks, joining investors on We're start to three. begin and quarter to with for on first mission Thanks afternoon teammates We do, or a welcome, daily because what basis. Kendra, it's our our us our every teammates through results. our going like go whether Slide financial company we and or presentation it's and to vision statement everyone. customers motivates to this

mission Our improving lives is care. to save patient by

every all transform everything to in, patients' our do dive of make to place for lives. we many want so they I a teammates to thank Neo and to Before be do single such great day

and into to as very let's XXXX. when XXXX the continue get to into the Now of move we Slide financial started strong first year We highlights. four quarter win

in revenue First million in our across first quarter increased revenue XX% prior XX% over per increase was per the driven volumes an increase revenue year, eighth increase year services quarter versus strong quarterly modalities $XXX and a our Notably, consecutive clinical was the test. by test. revenue prior

year. $XX In continued improved EBITDA increased modalities. which and pharma be NGS driven prior gross addition, XX%, XX% the revenue, strong, adjusted improved margin Adjusted and revenue increase to profit services growth high a growth includes by was XX.X% over informatics million,

our seen we've than Slide others. seasonal quarter little quarters. Moving past is being a five, with the to throughout first business first Historically, the the four softer quarter continued momentum

as execution Neo strong So testament a to new base accelerated our and this from products growing existing by demand teammates, the client our is well year-over-year for the our growth customers. as

throughout to our cycle the drive we remainder believe ability And operating the XXXX as the we with the initiatives are performance some continue beyond. pleased business have hold. We of of taking to revenue and improvements and are in

six. on focused solutions. developing Turning innovative oncology NeoGeonomics have to diagnostic worldwide Slide we teammates XXXX approximately At

of testing significant the have oncology and U.S. patient databases. share volume a largest one in We patient of oncology the

with do growing and market, the shareholder this right if do patients is and our ultimately term belief things to in starts everything we Our value. we that going long we underserved are create

our investor month, diagnostics, our day and people accelerate months, last our out are priorities we for probably advanced next XX and which creation, enhance XX value drive At laid the strategic to business, culture. grow core

our to enhance term a long have mission to NeoGenomics at is team We and strong culture driven this great continue our success. and team critical

everything organization foundation much While this the else operationally. of to outside is do visible work this key we be won't

QX, going other on I'm call, in progress great today's to we our all focus In For made three priorities. three.

a salesforce yes, continues which As seven, expansion across and all Beginning per modalities. as few on pathologists focus see in oncologists the in revenue optimization, offering let highlights effectively core ongoing areas. revenue growth we Slide continue be reach of to us has strong a more volumes to as growth the well our product to of we test. profitably allowed to touch with creating business, an me clinical and in our strong strong growing each move And growth result

of a Additionally, of our core test NeoGeonomics, growth. a in per in highest for quarter we -- the set record volume QX business testament tests the product history to

MRD and our of head last the lung, assay and RaDaR clinical second RaDaR, for year in breast, approach our studies research assay available advanced four collaboration. colorectal. diagnostics, with accelerating indications, repositioned over we and go-to-market use successful in has neck pharmaceutical priority, The been launch For

Now clinicians clinicians allows than times available U.S. which available cancer tests cancer fully to detect market, on identify to recurrence XX sensitivity earlier. to small to up amounts other of it's fragments, greater with

tumors. our tests new we including quarter, Comprehensive also solid portfolio expanded first for Neo with the three NGS In

year our We MultiOmyx submitting our and have breast cancer two completed RaDaR end. for submission by for in additional indications track

we the our teams well addition, Informatics have out of positions In growth. as for and completed which salesforce Pharm build continued

third priority, is our creation well And underway. driving value

we're in volumes, significant have we clinicians to sooner. and and improve in to by even the first We continued see in delivering results XX% efficiency and to results turnaround thereby Even a well. patients productivity as beginning have testing prioritized increase times quarter, here an with increase

significant Additionally, revenue of fantastic the operating through leverage a bottom was we generated a line. large to as percentage favorability quarter. Overall, fell it have

to our results I'd over Now turn review in detail. the like financial more to Jeff call to

Jeff Sherman

Thanks, Chris. with I'll begin everyone. Good afternoon, results detail a more operating quarter. little the for our on

Chris growth said As revenue the performance. financial we with accelerating continued started year and improving

XX% revenue improvement test times. highest per of over in higher to growth a First $XXX test growth was clinical the prior quarter year. continuing represents driven QX was reductions shift QX a XXXX. revenue volume, turnaround increase growth quarter and revenue by since in by million the in complexity tests, Revenue

this higher increase Clinical year-over-year, increase $XXX driven per of Turning by million volume and Services Slide of nine, X% test. in revenue revenue was a an XX%

We our us enabling salesforce that oncologists optimization are reach and pathologists to encouraged progress. continue show strategies to

X% improvement focus XX, clinical Turning representing initiatives. test increased consecutive by the average cycle revenue to year, test to an $XXX, and higher prior revenue per quarter eighth turn for the we value our management versus to Slide as

Pharma, by XX, to price driven strong Services $XX Turning by revenue from increased first Informatics. well million as of volume Pharma higher the Slide revenue both compared in as quarter by and to to growth XXXX, XX%

million, Slide an points XXX on higher These improvements significant of Adjusted statement improvement XX, year. or first profit quarter basis quarter the operating was negative a of operating over were adjusted first of income EBITDA last the at gross $X both the and XX% Looking XXXX. highlight margin the XX.X%, expenses over improvement million gross by leverage business. $XX driven the in lower was and

$XX.X G&A marketing expenses, was sales and was million, Regarding expense million $XX.X was million. $X.X operating R&D expense and

quarter the there announced previous was costs organizational to addition, In $X.X in in and optimization. related footprint restructuring restructuring million the

Turning marketable of to first quarter the million. on sheet ended the we Slide balance cash $XXX with and securities XX,

was million in or quarter the improvement XX% $XX cash over an QX $XX XXXX. burn million, Our from of

financial continue and in position a Our financial achieve strategic to invest business flexibility strong financial and our us to provides objectives. the

QX Given and are progress continued for executing the financial on priorities, revising performance year. and EBITDA we our revenue strategic guidance adjusted our our

Slide had XX, at growth to revenues to in representing million, X% previously to $XXX we XXXX. X% million Turning $XXX

was now to now and million revenue XX% $XX $XXX representing to negative We to $XX a improvement. total XX% million, expect the Adjusted $XX X% million negative EBITDA between representing $XX to is are and range year, XX% million, negative growth. million $XXX revising that negative for and upward million

to by the continue encouraged are and growth for revenue opportunities strong see increase We an in Comprehensive. very mix and in Neo product RaDaR NGS

we As progresses, but the teammates year our deliver a will year-over-year dedicated more believe to we get foundation results. financial and strong difficult, comparisons have

focused driving future also be will invest efficiencies, in on operational opportunities. continue on we our to business we capitalize to the continue growth While to

Our strategic deliver growth. sustainable to remains long-term focus

over I'll With that, to back Chris. it turn

Chris Smith

Jeff. Thanks,

growth revenue adjusted quarter. As including with of a we improvement quick provides significant our year-over-year and We're summary move the EBITDA. to pleased progress, strong XX, Slide of XX% very in it

guidance. on meaningful In progress strategic we raising our priorities. full execution addition, Therefore, we year are saw the in our

way on leading We company. the our are support to and information well decision cancer becoming testing

We our of for who a our the several the cancer to teammates we on and and have basis. long I'm daily excited laid to over all with build past will months the foundation sustainable continue term on we growth. customers, most deliver patients serve

operator. and time, I'll to back it Thank for you you turn your

Operator

[Operator the SVB from today Souda Instructions] from Puneet And Securities. question first coming is

Chris Smith

how Puneet, you’re doing?

Puneet Souda

for Chris. Hey, questions. I'm Thanks good, the taking

sort are guide the by the and quarter some when was you're what cadence proportionate year, the increase, a we the look amount. Your if $XX in that you here. But rest for? things you're am guidance through sort million, strong of I increased wondering, And because mean, of just watching of on beat as the may? I prudence the out that for our first one number guide counting the what I the by things of congrats of sort

Chris Smith

to following couple And think things the I Yes, have there folks were And asked. fair that of asking, Puneet. a us. for think get a look, that's probably we're been going question. it mean, look, you're I I

we evaluated the began leadership team, and opportunities, we and great as business I really into put focus initiatives in significant new strategic a saw with we place these think relatively executing. a franchise came and

are business And it products. become new think improve efficiencies? mean, a rep take coming to I operating how to does think launching you for how any like, can that leverage? Or fruition I candidly, you quickly. how effective? long you I And quickly get those do in Or

is coming about think but a happening you're effect, is And that like talked what lot I things and -- what's together. of seeing are portfolio I always the these,

And we performing so over to feel think guidance I and under as really I that's and the over the where generally, think we deliver. very And what setting we're getting nature going. about is business, tried that we and it's do guidance. -- we by well, want feel that's to promise initial raising know promise our good And comfortable to

submitted we in on know or say don't first where breast, solid MRD answers I one I we that launched, our we're quarter we RaDaR, With on launched -- for So the would is believe probably hope behind We we I tumor. we Look, NGS, incredibly if -- MolDx, competitors solid which tumor new differentiated the product question. sensitivity. NGS. get were your

it's important whether these the or So traction. I reps that to And an are getting hiring, think Informatics, we're them get Pharma those then things. clinical in

And so term about growth. it's now, this long sustainable

just about a lot and we've expanding we talked So underway. use, that's well

of operationally, lot on, said perspective a I you financial can lever that initiatives IT a there's things but so these taking we're hold. of working move are think infrastructure the where whether from some And

Jeff Sherman

the and the to investments, well. also on on, continue getting add, I sure coming look, execution, ramping as impact. Yes, making to I we new I continue that, would going just noted, with the just on I to strategic progresses, as right we're we're an as make to will year up as have them think Chris said, think focus education salespeople we need and training

we'll fourth make and benefit second, So long continue to third have well. the as will and which to investments term quarters,

Chris Smith

needs It's I talked it execution. great And think is seeing what it Yes, we but you're have a business, about execute. needs this. to

Puneet Souda

the about of Got sort a AUP, super we are On quarter, was guide, guide? NGS of it. and much context the of and think overall you the contemplating you. That's within obviously helpful. in AUP Thank this when contribution, improved how the how that sort of that

Chris Smith

we've volume guidance, the some talked pricing Yes, to revenue but out we that contributed mix as had well. break the think, And continued say to would gave And pockets, good didn't progress NGS growth. also had I revenue strong. success we we and cycle be we've that the when I also different initiatives,

give the So factors us I'd AUP. of those think good year for the And say and visibility contribute. on are that all I remainder pretty

Puneet Souda

Got it.

Great Okay. you. Thank guys.

Operator

Thank now from you. question The Craig-Hallum coming Alex Alex, from next Capital is Nowak you live. Group. are

Chris Smith

Hey, Alex.

Unidentified Analyst

give new from Alex. outlined us Since that salesforce organization, I day, kind the the Thanks guess well, the for on that the actually little your bit that details you bit specific this little on major new anymore, kind more customer of you pretty any first of split progress kind side. is on that maybe a of smaller, of or seen that into were guess a for base you've wins different qualitative that us you way? Analyst Chase target question. Hey, kind stagnant structure Chris, can new a on structure taking to before kind in you've of I you on the more allows

Chris Smith

is maybe who's out there. specific the take quarter that group I time and think months, first day, I so wins customer won expand, follow end here, and don't I talked we it, all, first I'll at more that Warren, who's XX up. for Yes, losses, probably or mean, will Warren about leading the we're I'll this than of industry. then in that let lost. we and right. a disclose competitive But of the highly pretty say, the putting to had fourth we can sensitive we And Look,

we're think talked color I about Warren add then So do you than want Investor that day. losing. But to bit the And little more accounts? at accounts more any specific without winning a

Warren Stone

we think lost. about expand Investor at day, strategy played loss one. spoke customers new have well, ultimately, specifically, spot XX. I Ultimately, we this, And really in commercial more that's Chris. out than we quarter the won seven, may the which We protect, and won And was and in. we blend that Yes, on,

to there. So digital see. And we to execution and traction, positive ultimately, that able the to as gain and effect use that's are net start particularly other AI salesforce is tools, we're of starting as these the tools, enabled some results we're

Chris Smith

like X%. was what Yes, is of mean, volume up growth I a testament and I think, north the

think you're both. getting So, I

Unidentified Analyst

How guess then makes of in certainly, MRD bring acquisition that with Yes, you competition a to kind offer kind And kind as offering your I sense. proposition? do of think here us, being within of And large with had non-MRD well. kind a there. Haystack, going from last there large like to also of compete yeah, full lab menu becoming them value service able now a you'll they're

Chris Smith

Yes, the things going so line Vishal answer, then who's on to a also. and couple I'm I'll let

heck the of that already So a ontology. mean, of look, at of tests I competitor lot a Quest end and was the day, big offered a

a competing we're look, every so And that less great to against $XX market, than for it's And a think I billion them or is day. billion X% acquisition be the market it's $XX going penetrated.

So competition is great. I think

That yet. haystacks, being even not commercially said,

we're acquisition, long starvation, people the -- sold. to don't I I a still being of so with go is die in sticking not ingestion look, the about own market. there's focusing that dive was MRD we're Vishal? now. want of you I be And our not we're acquisition, it'd to that's So wouldn't mean like I the something it Quest good before come plan. got our bag, on I that any they I always worrying joke But good with indigestion, they a knitting acquisition, right think -- to versus I think And way Do applaud them more to for

Vishal Sikri

you it, I said No, Chris. think

right practices clinical a that where I that’s a and think long market now as pre to market the the they're and it's have moving for good shows overall said Having the way whole, you go. MRD they to. revenue

today. we're we So where comfortable pretty are

Unidentified Analyst

Thanks thoughts, guys. for the

Operator

And from you. next David Piper question Westenberg, from is Sandler. Thank coming

David Westenberg

print for much strong so really the on congrats you And question. thank taking here. Hi, a

back going the to to I'm get margins. gross So want just to

good. up the way gross sequentially. margins Mix is Now really were

the you in can sequential were confidence in given maybe that we XXXX-ish have see XXs. could that? really higher get historically Do Are the get in initially, So to you thought you the to that? think that up GM? the into just XXs, in up good really leverage high faster you step maybe now that we I returning seeing than

Chris Smith

investor us to revenue example of QX I operating give to will the by company's the of we well continuing a time. to think to good just expect confidence on perform on execute more that generate to we growth. think, historical set Obviously ability there I similar over again, day, getting leverage margins return But and QX, Yes, company's XXXX. is

help adding that. And will so I certainly think drive growth

As in business. look our you at in versus we see, QX did a and Pharma. costs QX, relatively Pharma business as And decline there's expected our fixed in clinical more

clinical expecting see you margins, did you see pharma were $X.X up we so $X.X And But down million million. that. did gross and

stronger came in we were initially than So overall it expecting.

really helping clinical drive to is I that. think So

of mix and to the get another overall focused a think impact. that profitability we returning business are progress the And think an quarter quarter on particular I I is good cash this to But have point. the free and producing so And flow. can in very company to

David Westenberg

Got you.

in think talked You I have are question is you hires, get the you you remind you. P&L you're you about get operating analyst on really salesforce good and reminder? where yet? analysts, been just this Can Thank again, a a the I lot day, hires that anyway, of just short quick where Because I'll those think you at? said, hitting us leverage. here. did But at has so

Chris Smith

Vishal want salesforces, but come and Warren is with Vishal detail, to and wants go full update? But on let if an give much here. in you RaDaR into I to Pharm I’ll and also mean, smaller

Warren Stone

cost start on I‘ll Yes, the side. just on the

seeing revisions of our we sales as you're plans and yet marketing some some of also much well. comp in expense. So ramp in Look, not a did

as marketing and having ramp costs. lot being expect there's But reps start productive come as see there. think the I factors I these of think So in of and progresses, commission year sales more on, to a would salary I

other quarter, Investor expect quarter. the guidance, in offset by the the I to in talked is for ramp our was we some that that the some was progress. And but should year. number so of there you at throughout It investment things to more so And day about would part expect

Vishal Sikri

very Jeff the think there's you people rapidly bringing on. is a said sales We so self-explanatory. similar I what Yes, take thing revenue from if perspective, cost David, evolution or pretty

have will end positions month. by of fill be to think done six which this I we more the

HX. as And full I get were now. filled productivity January. we really some get starting we earlier into to to in that stride those say And we of feel we're have

David Westenberg

Those six are for your there. HX you around then get hires,

Vishal Sikri

and terms of of a the six expansion salesforce in then in further HX will of Phase The part Correct. the year. X latter there's hires that do this

Operator

Thank coming you. is Brennan Cowen. from The Dan TD next from question

Dan Brennan

Chris, on Hey, just Thanks on how of Maybe you’re quarter. the doing? in questions kind the for Congrats Inivata and off starting here. RaDaR.

of year then kind so QX, heard about decision to this remind QX, don't you expecting you if you're us, more I well. half, front two there? I during know back said timing this color investor for I remarks, just Just think three? prepared thought, way you're And us year? a expecting little maybe as any the the Maybe indications more that day say on

Chris Smith

let But in. for past Vishal I we submitted review first jump breasts want And to clarify, take Yes, I'm historically, they I'll XX-ish to let going QX. a in timeline.

QX, maybe that? take be want to on disease state communication Vishal, about federal. do breaking them you with we'll all even a different Vishal around talk of in one. we're and MolDx up that that just how managing So can breasts in And to so in

Vishal Sikri

Yes, absolutely.

to indications had a that for Chris the QX, two them all as year in with have And yes, on But year. their So we additional three mentioned, conversation of the we in to what this as and from side. QX, in QX. go do It expect we said. total early expect depends do we timeline submitted

Dan Brennan

Got it.

it the you're the think there. rolled giving just Comprehensive And day, Neo talked to in know, so or not about on color maybe on about much think growth you you out Okay. I from I But us maybe early anyway just traction the that the customers kind and impact, qualitatively with? just NGS, too of then impact, what's XX% Investor

Chris Smith

above Yes, take was thing look, I'll let XX%. that. that those to But guys be both remember are

the can give… want were to I tell well you for quarter. that guys But we you above do So XX%

Warren Stone

I and think I'd trend of product Neo in launched in continues. March mid-March. say we only terms our And expectations the that Comprehensive, month the we of in met

Chris Smith

Vishal, do anything you got else?

Vishal Sikri

where right. I thought we No, on we're to we mean, that's think I be. would target

So.

Dan Brennan

Got it.

get I'll right. All Thank on Okay. back queue. the you.

Operator

the Blair. question coming And next is William Andrew Thank from from Brackmann you.

Andrew Brackmann

Good profitable year? Pharma that and of start you of Chris. on can a that Hey, healthy I those revenue the about We there with coming guys. Maybe services makeup maybe of this Or something the to sort that the through? guess is be sort the onion flux, projects Hey, of bit line, little number, take peel of a just throughout still as more number. afternoon. that's back should and improve to sort more in more Thanks. talk

Chris Smith

specifics of can disclose Yes, let far. about I we Vishal it. Jeff, and I break let color. kind But Informatics. and me that Michelle But think or about talk don't in talked the probably Jeff paint out we some mean,

Jeff Sherman

Yes.

I'll jump in. let start Vishal So I’ll and

was QX three RaDaR growth growth, our had had the said Inivata we significant strong overall in would and we So quarter. some we pretty QX, Informatics, in Informatics some in say and legacy all I growth. right. big, good Pharmacy had strong, And pretty

it certainly we're track we where to to expect say on I'd be. So

think at you We we rest set want I if we up pretty add else? but And look Vishal haven't year. into specifics, the well are, to are we the gotten of I the as think anything

Vishal Sikri

you're right, No, right. I think

effect quarter at always you the year. always seasonal been business I for QX his we has think that look Pharma in as to lowest the general. see our

So gone going I how are of quarter the expect the mean, where and that do the good we see has we we into rest do year. growth that

Andrew Brackmann

guys. Thanks one. the take I'll Okay,

Operator

question from Sachs. from the David is And you. Goldman Delahunt next Thank coming

David Delahunt

to congrats beat? the the additional drivers that color the of quarter. led increased volume on guys, strong Any on Hey, that

Jeff Sherman

we have time. reps we I hit a XX lot it. Yes, hired year talked hiring -- we've of we're in that tried end that we we XX think I to of get about mean, by started that of been expand oncology a the the spent kind I mean, pretty half really and Look, the then we've to rapidly the to year. going open second of

way get the they're think first in of the I half. we'll two-thirds

I the new group would of industry. share that think to be to a fair, start coming say is when you and folks, get I lion from

they So knowledge. relationships deep have and

I of things I about five-year I one we've not the for this you're mean, think hospital think that contract. they an quickly. talked business in we can make an analyzer it's relatively like, that not is not you're placing the basement impact there's

business You quick. pretty can move

And expansion being would the so think field. I process about and product I that and the about I doing don't a say more I I'd in we category. accounts places the this, we optimization, thoughtful definitely mean, our maybe in Warren have and of strategy, that way bid think, talked go-to-market the say where winning think

XXX we over remember, have So tests.

a use optimization. in I that and lot word think, the I

lot I think of that's… around things is what you're execution. a seeing And

Chris Smith

is Yes, Warren of a things think that day. and themes is just brought One add we would two I team and I on accountability. a -- sense leadership hit certainly that. and couple urgency, couple of Investor the And have of a

So think on it's it's I just for holding results. and accountable execution. leadership, its people And focused

Warren Stone

I'll And maybe just add… two other things that

Chris Smith

I sorry, mean, have an obvious question, And out throwing… no melody I one's say talk call. rough, would too. turnaround turnarounds, I time, Warren, melodies shout our do I'm been we a may on asked you way about too the should but to

Warren Stone

No I think, say omit any I'm going thanks. just just and

positive customers. wallet, easier number have also improve. only execute continue clients it's strategies. our a much existing fan improved your that's done a on. effectively. and, good it's a turnaround about the share not really which the strategy new of our of team turnaround we've by more ultimately, And and and ones, selling is the doing And to to winning recognized to existing are many that, of customers the that expand times us helped in protected retaining really and year great from job that upside I so that's supported when think It's that's win And times

David Delahunt

work. Fantastic, great

Operator

Savant Stanley. coming from Morgan is next Thank Tejas question you. The from

Tejas Savant

Hey, Good Good the Chris. to start evening. year.

congratulations. So

you're can sort in Vishal? still of switching Neo tests. sort kick sort off. mentioned Just take people's of perhaps know seeing color accounts of that users early I many those one existing least the so Comprehensive, first But how can you are on it's the on Vishal to those essentially Any degree days of at And in of you'd perhaps launch. other far of this. time things from share CGB users oncology

Vishal Sikri

Hey, Tejas.

think a launched just I a -- we still bit early, year, it's little a ago. sorry, month

think look I that. we that, that for see forecast still well would other competitors share from I how on we're and days market be So taking say from where perspective, we at coming meeting much it's I early to where and would of to a going thought we track now, we're so right but think from it's still on.

Tejas Savant

Got it.

sped sort mean, or picking you're that customers? Okay, shipment up your thought budget in smaller mean on constraints fair any funding, process of your delays enough. I any I just guys, biotech things, around at cap And especially then the Pharma side evolution on? of sample

Chris Smith

that? to want Vishal, do take you

Vishal Sikri

I can Yes, take that one.

in see strong is general. modalities, our what that very do But like see that like I high so demand still call modalities what an of some So in seeing traditional NGS, we're our, there our we RaDaR impact and margin for on. we is

So we up on but make we do see but little bit can we think a that other side. impact, the of it

Tejas Savant

Got you. it. Thank

Operator

is coming from next Andrew Raymond The question from Thank Cooper you. James.

Andrew Cooper

yet. time has Hey, nice ops question. Hey, Since an and nobody for start the everybody, I quarter. with Chris. else I'll guess thanks

sort we're like can better? and that you'll of just risking to you margins the drag be you decent move about that de you've getting able amount Houston, to but try the that that where versus where be that ultimately we as so feel at parts when I about that in do analyst expanding moving meaning you think those far think what of gates, we to, day, know, from you are risk are points it be of automation You sort journey, to we a track those talked of you are you all the continue in optimization where managed? lab Well, to through sort want

Chris Smith

they mean, things of on. the give we Melody mean, had of still have I thought. pretty we're say good think in color that. I’ll you innovate going second level you what's bought It's Inivata, -- Melody lot think Melody the think I look, around some more I I when you one But Look, automation, didn't early I color. I'll time Andy, I a want on? would gives high to spending give we know,

Melody Harris

Sure.

for line Chris Chris, the maybe bottom So threes was that this agree two, said, automated. inning inning I taken, automation, as fully fully we're remains have with would automated, journey, we

so that slowly other we're there. our expansion we add starting replicate to automation And then Houston And as to we'll the modalities. in go

And showed that to yesterday neural more AI use our in adding automation molecular line, our some cytogenetics so you we're line. that of in we deep we're the with starting network

there. So steps beginning, we're that's taking good

a ask of You will, similar risk points, some on a that's for as we of And issues to get of some in out. slowly, that because for to expand lead automation course, out chain trying about long risk Houston much be the that relatively pieces, us. then as risk going be chain but supply we're as build supply barred rolls items not

Chris Smith

about you about your do talk to and all the dry Melody, to think starting want lamps? together networking, pull Hey, also with you're

Melody Harris

Absolutely.

than locations more lab analysis move and the the network scanning where images doing are wet office for expensive from our the that we in we be lab wet real that analysts we to less itself, those or agencies So digital our and we're and away build uploading space, in around if we of are and so can more our the the space, expensive more can our locations. can hold estate out

the some to by zones. time our us there. gaining into able and over do load That's turnaround times work, the the network, network, then advantage digitizing our also we're improve across we're analysis helping so And

Chris Smith

That's great. Thanks, super

Andrew Cooper

Okay, if sneak I in. can more just one

Chris Smith

Yes, hear can you the quest, will. you that might

Andrew Cooper

appreciate it. -- Just

of versus more more billing advanced kind sort driving you as the well these reimbursement more on maybe and oncology Just think where about of the back about the selling of billing think we of of I transition of a side end, When diagnostics. sort end and OpEx this historically think this, lot route where suite, when up we do? hospital traditional sort up you what's what's maybe what and with need of more, spend, growing to have might been? the to business payer do than stay a to volumes to your continue speed you hopefully, little up bit are kind kind the process, And keep historical lift the that that the in that

Chris Smith

Yes, evaluation, we're I clearly seeing how that. IT we think from part our revenue side enhance current evaluating cycle and do as of revenue our platform the cycle

at that the think investment sizing back do half the perspective, more that's and XXXX I capital from a a we're for looking So probably year. of certainly that of

have give little I But we think the and in do better that infrastructure I But cycle I a is help accelerate make, technology will there think but think us that place, in are structure maybe revenue investments good visibility. can we some bit place.

forward in do some optimize we looking think be we the on ads that. half the and in that year how help as focus I technology going XXXX, at in clearly will go And beyond. will back of

Andrew Cooper

stop I'll Great. there. Thanks, guys.

Operator

from Thank you. The Mike from is Needham. Matson question next coming

Unidentified Analyst

guys, is Mike. Joseph Hey, on this from

the price test day you think left maybe out ask. well about talk ones question that cycle assays that aren't say been see tests, at the with color investor all had only didn't just really of on higher or some assay. really pruning you NGS really previously, of test volume a revenue large price in menu, any gave the maybe this or maybe lower revenue tests of maybe guys don't Appreciate I increases as needle. I the the as there the I maybe But hear taking amount one anything per moved to management, around probably believe,

if works curious been any So done that, there. I on about was

Chris Smith

sure from think I effort. I see over continue we'll ongoing I'm not an time. but that's you'll think an think is AUP and in effort impact material refine looking we're that, that to I that Yes, that at ongoing

Unidentified Analyst

guess services, Okay. question maybe And then similar for just Pharma I though.

throughputs towards where In time. get an over we're just work that's trying higher. to terms completed guess be thing That's the working, ongoing similar of to thing shifting be earlier to going the I phases

Chris Smith

we started half second certainly in of think Yes, XXXX. the I

on earnings versus I that and are our success have I even of from clearly our revenue says next focused the term near visibility and periods. year in both really is whole we the clear better bookings, I think whole think And compensating there. had approach, focus continues. reps And we've taking how even generation think drivers good out on that the really on approach over of quarters couple we're we multi revenue pretty

Unidentified Analyst

okay. Absolutely. Yes, Thank you for very questions. much our taking

Operator

question from The of Bank Derik from next De you. Thank Bruin is America. coming

Derik De Bruin

you? good Hi, How are afternoon.

Chris Smith

Good.

Derik De Bruin

questions. couple a of So

quarter I unusual, how doing your Are and that look on run that rates? of the you this, year? are rest look thinking So at about that you sort you and like to at when rate, had thinking to a looks increase price. know, -- of XXX moves how how are a think And quarter basically number just pricing sort a about up? Is of to of and you the X%, sustainable, the in anything pricing you you guess pricing competitor’s premium things getting sort at at that you're about

Chris Smith

with all of some not and our that these management, and was significantly reimbursement relationships services as company, of managed it payers increase, we the set one a cycle premium under for a look, calls pricing and chasing process levers whether I well, standard getting or obviously these is the improving Yes, whether that have think price revenue it's things. but

be been look think row, term, I think I eight percentage we've I mix will continue do lifted. quarter, look, especially short a when it so think, I every And I you was know sustainable. to don't term, short our in XX, quarters that it's what say XX the would months, look, but when doing

markets would we're the far a for which moving, and but probably on leader is ASP. is heme, our which a share behind NGS way sure, a be highest solid, from where We're on

continue And market I is things so our of of on. to as think us that lot so also going grow, share we a there's going to help

I I mean, I so I goal our don't say disclose yes, it's… go do we but would how it's much say will that. to think and internally, out And

Jeff Sherman

we a think I are levers quarter. which Yes, any strong, have a expect was higher we room, But it was for type I trending, the wouldn't it a as pulling, quarterly to over as cycle revenue guide time. have benefits, to impact, but tests, to positive definitely specific intensity is try impact a pricing are But I quarter that going extrapolate improvements are we all of strong definitely do one a quarter. strong QX wouldn't well you

Derik De Bruin

my your came it. to out, you as so on weakest strong. it's And Got QX sort of mean leads of to pointed how sort next I about quarter. the And that think seasonally usually in second quarter. question just

Just what the I of thought am sure make point. quarter-to-quarter some this on increase. the quite not to at modeling

any like you know you is thoughts I what QX Just and terms would historically between jumping of on mean, any of if just seen, there model general it? in sort I don't thoughts? qX,

Chris Smith

Yes, we year quarter Investor that day, said from on over basis. quarter a throughout our a we think expected at I the progression

with So I've that. just of kind stick

If you quarters year of prior about the rest as revenue year. quarters think the you're for versus thinking about the the

Jeff Sherman

the Yes. would that But initiatives. I Like, question. first we're I think said from definitely the I look, momentum getting in

we raise guide, continue. that we how so good things will I think significantly feel enough so And about

Derik De Bruin

Got Thank it. very you much.

Operator

coming The BTIG. from Massaro Instructions] question is from [Operator Mark next

Mark Massaro

hear me? Hey, you question. Thanks for Can guys. taking the

Chris Smith

Yes, got you. We we can.

Mark Massaro

I was Yes, on Okay. mute.

you really on not -- haven't had guys haven't a question yet. you RaDaR So

but up you're seem launched, leaders in that two recognize of coming quite months to you're some market CRC. I two entrenchment So degree The not have months. on

included Are CRC. well had any almost of And neck launch that two that from RaDaR are volumes out in takeaways curious guys that You launched you terms as breast recognizing I it's of in strong clinically? if in the in volumes? as volume QX months lung growth head of I'm in guess there some really and first early

Jeff Sherman

Yes, wouldn't really any have had I revenue…

Chris Smith

clinical side. On the

Jeff Sherman

out Yes, because just kits on the late. sending we're clinical side,

the in, any want we it's to talk wouldn't you want Vishal, So if we about into? like by the how time a to kit have and But jump gets test, revenue. Warren run out, turns you going gets

Vishal Sikri

progress, we feel in where long in see Yes, thought we and Chris our the neck line we cancer wouldn't that that, so because that cancer, mentioned, we breast how in strengths the starting with to as But complete would I and have be. of would -- QX. we seen we're in testing, say head QX, so it takes on, they're have good where to

especially So I the think really of the market of because in cancers. assay, high that's is really showing those this type sensitivity of positive uptake, and RaDaR

getting other it where and say and to sensitivity that they good would to people I cancers also are starting that interest we're want feel use from see applications that matters.

the same also exploring So Mark. opportunities time, we're at those type of

Mark Massaro

to I volumes do press then and Okay, into want again.

this volume approximately We three haven't two or in like growth seen years.

talked well terms How are we the think came like you inefficient from about of I What flow? NGS could probably from -- you So I demand? markets, growth end much of in could XX%. market was the hiring And any new know, reps? benefit seeing investors above about of commentary volume end

Chris Smith

last growing And is on focus quarter, Yes, accounts. there, business being back I this But getting that seeing I'll lot think over it's because example, out say, a it's grew lot of think NGS I look winning look, talked a modality of we're for one thing had more the of I would to say to I months. the wants the really, kind in everybody obvious about. XX would above And been quarter, in was where that we start really, every heme.

we I winning. a expanding business a you're our executing the is that's is see business grew because a as think the growing starting you, we lot supposedly or field I to industry below wallet we a what and will rep, look, I just that's I industry. growing, moving say growing. And from know And And Warren that, tell perspective. the as I significantly, new about would say share, we're were where think would a market were leader, talks not business the share

of rep a the what it rep calls but of oncology this on to such industry, making and group call believe in reps pathologists that for point. And I number oncologists is very strategy do on unique compared on group do that I pathologist can impact different a because we rep significant and is a our having a was a have group

Mark Massaro

Excellent. Congrats on quarter. the

Operator

Thank you. Stephens, And question is coming from next Mason the from Carrico

Jacob Krahenbuhl

already lots quarter. for A questions. on Mason, been here. a for strong congrats really covered Hey, this Krahenbuhl And taking is thanks our Jacob

one most recent earlier. So And initiatives. on revenue just bit talk this this to a day. analyst a touched maybe number you're already about of management But your going been cycle have at quick on a might on your front initiatives little

just are what maybe far, so front? you and further what's been initiatives this ahead you can update of So if wondering on still us give implemented a on

Chris Smith

fair of moving and the Yes, to upfront amount of getting a when a we more information requisition we've done more billing process, our automated get in tests. ordering billing more test work on

both made progress doing. progress of would for good those getting in that say I on those paid on we're also we've made So just work we've the quarter.

done. already our in that, actually volume, some but seen and a we've just getting already historically lot I the again there's do we've at work lift paid how on test or a more some of done, particular to and and cost, revenue we've paid what payers we've patients been focus the And we of for had the So looking we're test well improvement we actually success to think as get get result paid. need having

to throughout see both year. go So the still as think on areas we lot probably bigger I are of progress that improve we've two of those made opportunity and a of are the

Jacob Krahenbuhl

Alright, at one. leave it got Thanks. it. I'll

Operator

questions I remarks. Chris you. at there no other Smith, like in are back the this now time. queue to closing hand Thank call And to for

Chris Smith

everyone and the quarter And on share kicks the some look questions. also with afternoon. to the market. thanks on Paul. Thanks, care. through this forward great It’s be We’ll go see call, right. for Take All you

Operator

Thank This you. today’s conference. does conclude

this you may participation. Thank disconnect at a and have You day. your wonderful time, for

NeoGenomics (NEO) 8 May 232023 Q1 Earnings call transcript