GH - Earnings call transcript Q3 2024

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Operator

Hello, everyone, and welcome to the Guardant Health Q3 2024 Earnings Call. My name is Nadia, and I'll be coordinating the call today. [Operator Instructions] I will now hand over to your host, Zarak Khurshid, Vice President of Investor Relations, to begin. Zarak, please go ahead.

Zarak Khurshid

Thank you. released for Health September quarter Guardant XXXX. XX, today, financial the results ended Earlier

from Helmy Guardant Talasaz, today me Joining are: Mike Chief Co-CEO; Eltoukhy, Bell, Financial Officer. and AmirAli Co-CEO;

that include materially I'd could results to also make begin, call cause discussion statements meaning statements actual laws. the differ or non-GAAP anticipated. This financial federal within call, will and involve we Before material forward-looking remind you risks from management of during those like a which exclude will securities These to adjusted are of events certain this uncertainties that items. specified measures, to

issued new or information would law. reconciliation as our Helmy. or in financial as and and because turn to projections and Additional measures forward-looking accurate I is live obligation well uncertainties, other in required of non-GAAP call comparable XX-K over the by SEC. Guardant the filings directly or whether to statements, as only the as Guardant GAAP events broadcast. With intention financial the information, the risks of disclaims today, material The conference call except most that, to in any are as update like future as regarding this information available with well release to revise otherwise, press

Helmy Eltoukhy

across our test opportunity unlocking cancer with on past continuum. screening Roughly first thank Thanks, our cancer thrilled later, version on years and embarked launched market into third monitoring. quarter cancer individuals Zarak. XXXX. mission Slide our were cancer the joining the the to millions cancer Shield, X this for years first into for asymptomatic launch in we to and Good we data. X, we of ago, XXXX with X. recurrence afternoon, more impact with our you exciting In XXXX, we earnings to XX August late-stage potentially an call. Starting conquer quarter, Guardant GuardantXXX launched on Reveal market And

when lower our on the cancer was woman lives. start story like impact back practice, with can patients' diagnosed metastasized, test is the important initially if our GuardantXXX biopsy test would call ordered was our the and A After A illustrating pain. a metastasis to mutation a a was cancer, determine doctor actionable was any breast determined had off had An improving liquid experiencing ESRX and cancer later, mastectomy. revealed As to an I The was in biomarkers. a she also lab. underwent test left germline elacestrant with was double variant, on few have mutation a she she therapy. which after be breast years later history old. began confirmed GuardantXXX aggressive years family treatment further to opted for report a hip placed a she testing of BRCAX XX and noted for specialized With a

and life-saving genetic As had result, testing, a cancer but her mutation, a the germline underwent found diagnosis was her not a chose date. Her sister to to BRCAX double prophylactic sister carry family information, same experienced cancer. remarkable case provide for with for of found mastectomy both to as those and without. occult was and This GuardantXXX treatment and highlights have patients symptoms the ability ovarian to oophorectomy

top to X. performance Turning on line Slide

by by continued XX% in total fueled to broad-based tailwinds increased million. quarter, and which We significant by of with volume XX% a momentum revenue, reimbursement quarter Liquid another into transition. oncology record was growing third growth GuardantXXX precision strong revenue Smart This our $XXX.X robust our driven the Biopsy the supported quarter

reimbursement. grew continues X% volumes with growth in XX% Furthermore, careful Slide QX particular, broader XX,XXX year-over-year driven X. ongoing even third strong digits by GuardantXXX the to across quarter-over-quarter, of and quarter sequentially. well performed to grew Clinical mid-single management for strength Reveal test In Turning our the and reaching tests, volume ahead portfolio. see of extremely

test another clinical shortly. not to quarter from share our GuardantXXX, include our QX our oncology XX,XXX test tests. screening for year-over-year TissueNext, was and Reveal reminder, biopharma volumes volume does Shield. on which more will standout a some up I tests, details Response is record a specific biopharma and are As volumes to XX% with progress

more GuardantXXX factor Looking significant late GuardantXXX positions solid the for Biopsy, cancer genes of advanced is of genomic platform tumors, time our tech detection highlights improved the includes the we leading of the and a XX to Therapy with oncology liquid within product. burden flagship upgrade upgraded some upgrade patients feature for biopsy test at tenfold, Selection. our launched and by with closely Slide continued Selection on all nearly Smart the for X. industry-leading the number Liquid business us our guideline introduces sensitivity and by and in improves LDT methylation enabled The In stack recent by first precision expands gain. our recommended representing for share growth turnaround July, the robust tumor markers GuardantXXX Therapy most

over of the growth we of the and LDT believe evolves of increase we add continue third clinical data in cancer are standard that quarter. believe generate gain view richness patients. will as and was breadth performance GuardantXXX this we are this drive to and an we that an care in Biopsy the capabilities In are sequential Smart GuardantXXX will quickly the very to will strongest As pleased growth continue of to advanced new contributor product cancer a volume oncologists unparalleled in to both the and clinical depth LDT year-over-year and Liquid time. on unlocked Due additional compelling particular, management and already features, accounts seeing upgrade, of become

reached for continuing which to shared test we cancer. quarter. Last upgrade in our GuardantXXX of options advanced also TissueNext in quarter, ASPs, the saw more $X,XXX with the identify treatment We improvements third patients

the XXXX, to that expanded share increase X, pricing and panel January have We strong $X,XXX. will excited from interest are seen effective in Medicare to $X,XXX

cash the flow positive our Selection in Following these generated in business free to great quarter. share updates, again that I'm excited Therapy we third

Italy. European one of significant Gemelli leading the Italy new hospital implement be processing When decisions housed a Policlinico treatment This patients patients. solid tumor to Therapy GuardantXXX recorded liquid system a in tests malignant on-site a mark will Selection We across cancer with partnership approximately oncology cancers. facilities Rome, implemented, cases oncologists advanced more tests is in are to Italy. access first of CDx within XXX,XXX informed dedicated in This biopsy partnership given able annually will testing for center make in also there announced to our with for tumor

Of therapy. were in on received the study patients. nearly of of and not to gastrointestinal further CDx utility long personalized as advanced using in the the clinical twice based effective X,XXX study, study those Finally, solidifies survival results benefits recently the this CDx, test treatment from cancer the targeted significant GuardantXXX did GuardantXXX patients published guiding XX% Nature GuardantXXX treatment with SCRUM-Japan for subgroup advanced match cancer. demonstrating GOZILA Medicine, in who receive GuardantXXX survived decisions This as patients

Turning to our Slide biopharma on X. business

mentioned we of earlier, XX% growing third record revenue samples As biopharma another Biopharma grew XX% quarter reported year-over-year year-over-year. had I the quarter. in

newest driven and signature over by Liquid represents improved discovery now offering lot novel We contracts. as powered samples applications development. reported of continue platform, and by to see excitement for biomarker performance, biopharma such XX% of Biopsy our Liquid Smart new GuardantINFINITY, Smart a Biopsy our

Liquid upgrade, of innings Importantly, in still Biopsy and the this we this early upgrade are strength in our by cycle. biopharma exciting Smart is driven

increasing our an recently for clinical important acceleration is clinical of biopharma driver have leading oncology testing a clinical seen volume, LDT testing indicator turn, tests R&D demand We GuardantXXX and is patient biopharma how of demonstrating for an our in interest.

together, Taken elements in create these oncology space. important virtuous cycle an the precision

in increased samples. a and seeing Finally, pipeline growing momentum we strong China also are with of

for shifting from Last our at was we we Stage the leader Stage II Cancer COSMOS is gears that and data to on published X, Slide MRD was the Now, are Medicare Research. colon submitted surveillance review Reveal study study to tissue-free CRC This shared journal indication peer-reviewed I reimbursement in and in for MRD. quarter, Clinical ongoing. where also patients looking MolDX the

have in CRC evidence in Guardant efforts only to building pipeline an will reimbursement, we extensive not compelling validity This for that, cohorts practice establishing to guidelines. be of potential Beyond has also clinical Reveal. influence instrumental and utility but surveillance, expand for supports changes

that year, to coverage ahead breast support the cancer. submissions anticipate for remainder potential for in will reimbursement of Medicare publications Looking the we

clinical studies year, for have cancers validity additional important Next such and gastric. we as pancreatic lung,

to Slide X. on Moving

demand are in in XXXX. the we MRD there the are seeing by excited and inflection are near-term tissue-free market, We opportunities multiple

We will ASP. continue surveillance to reimbursement, CRC towards make good improve which progress our

reduction for initiatives track We Reveal. also remain our on COGS on

milestones achieving than greater a gross will business. goal long-term margins our MRD these step of X reminder, be our towards significant for As XX% a

until we to continue Reveal minimize growth we and While strong and our we Smart anticipate largely and tremendous platform Reveal, Liquid are manage to TissueNext do gross growth continue Reveal XXXX. are so and market Overall, positive, strong to margin burn seeing we'll recent GuardantXXX, in cash volumes Biopsy by which we transition. driven appetite is seeing opportunity around for

of result continue the years. With over will and to turn we growth make, on oncology to few made for I this have our that, continuing AmirAli now more are screening. the call strong great will ever confident than progress we over are a year to the update business As that an see next

AmirAli Talasaz

Thanks, Helmy.

to on Moving Slide XX.

at ages we by previously who approved blood has and a XX covered be CRC colorectal average FDA cancer As Shield that that we to CRC test announced, test for now for have the is blood Medicare. first primary for approved older adults screening the our in as risk thrilled blood are also disease. FDA are the screening is option first test for Shield screening by and

XX. Slide to Turning

we with days Shield in approval, brought few after successful a market IVD August. launch Just FDA to a

an covered physicians scalability strategy I'm the of been screening approach had available. patients challenges positive us impact provider in Carolina, strong we keeping profitability. the This like of reception example share To who to for rural, on help being colorectal first this is months I'd from and Shield, share foundation that patients to commercially to industry-leading have a highlight a establish had initial in positive very South the long-term care focus to and strong previously primary up-to-date population. facing demand guidelines. Our test seen of few with excited will and patient

and With in patients procedures few months ultimately the introduction alone, last through he And just rates colonoscopy of quickly his were test, test, of has the blood went Shield skyrocket. screening seen diagnosed received to positive early X further Shield colectomy, cancer. of any their were In lives. with able cut treatment X required only all enough these the disease importantly, and patients cases, resume that most early-stage these quickly colorectal avoiding partial was his

coming more Turning which The from continue we covered XX details to exited now the is was to reception. depth by Early the of quarter. fourth and prescribing share saw ahead strong in expectations, post-launch We see physicians. of on to momentum, ordering of volume robust patients. we exciting our some with Slide launch our quarter majority volume the

to We by over continue the this XX% rate the see means we over draw. track end blood an the on people of field year. XXX XX%, adherence which a strong sales And to trained have are patients of force of incredibly completed in of over

Slide to XX. on Moving

to price laboratory more as confident recognizing will ADLT We are test, our that received screening. ASP very approximately advanced first-line pleased of important price class CRC report Shield of an even $XXX, an diagnostics be us Medicare This prior Shield to Medicare new designation. $XXX or that a makes

obtain Medicare $X,XXX more We even favorable XXXX. designation ADLT an continue expect secure in to to of price and

unique access This are screening color especially impacted sharing test the cancer individuals blood-based to CRC. of XX. acknowledges within particularly communities blood-based barriers of prevention Slide colonoscopy to CRC and by proactively has for and to for ruling cost early benefits follow-on the screening detection, to policy remove communities and promote that Turning for CMS beneficiaries. after finalized to its Medicare rural a incidence removes

X, quick final effect blood physician This are into rule schedule. by We the January the will inclusion XXXX. XXXX encouraged fee go in of on

on to XX. Slide Moving

with panel are team's England of receiving starting by the scale-up approval with publishing forward execution in to positive throughout study the our proud Journal FDA We finally, securing and voting, successful this our New launch. our advisory results and of commercial pivotal XXXX, followed We commercial and remainder year. reimbursement the executing of screening ramping look favorable adoption throughout first-line a rate label, Medicine,

one Shield history excited are impactful making products in diagnostics. the the about milestones and most We our upcoming XXXX in of of

which We guidelines, status, ASP. or potential Shield inclusion expect Cancer secure are and of Society, ADLT American optimistic about in to improved ACS enables the

multi-cancer leading with and We expansion progress are pleased detection a data. Shield our indication present on for the multi-cancer become expect test blood to to

more with Mike We financials. for our screening turn also to detail are I planning to over will that, upgrade CRC the call Shield our test on now VX. With

Michael Bell

Thanks, AmirAli.

revenue discuss rates, financial precision revenue to tests I'll primarily in Clinical $XXX.X and million, otherwise XX, record driven noted. increased line results $XXX.X ended tests from our million. oncology Turning XX% a grew XX% driven XX, was XXXX, XX% increased in for oncology clinical primarily XX,XXX Clinical unless months grew growth to which September volume refer by to Total Slide XX% XXXX. precision QX the GuardantXXX. with of X was million. to year-over-year revenue, and to to expectations our $XXX.X volume test by growth

seen As Helmy mentioned, the mid-single which our which QX Biopsy upgraded digits. of LDT, and very we we uptake sequentially start led launched platform grow to have strong GuardantXXX our Smart in GuardantXXX in of at the Liquid

of strong continued We third also and the quarter during XXXX. Reveal saw growth of Tissue

QX of the XX%. clinical in revenue XX%. growth of growth record we increasing fueled revenue XXXX, sight With line full up and Once again, to weather by with quarter, now be year in we million, third the the the XX%. This a to full biopharma the year, biopharma tests continue approximately of the totaling business end be at October, high-XXs XXXX. performed good number growth total expect incredibly exceptional was our oncology during the was year impacts For tests to we well biopharma expect XX,XXX, the precision quarter, $XX.X end volume experienced to third for which from the despite in of

other development $XX.X million. Finally, services revenue totaled and

and the they currently other tests, test revenue to start as As include of not revenue to in a numbers. volume services the Shield quarter clinical and XXXX and does material We'll in reminder, development fourth oncology report include precision line. screening Shield volume we separately our Shield become

quarter our to reach saw Since for we seen XXXX. Medicare to been September Day payers. and very $X,XXX Turning At LDT by rate we've GuardantXXX of Day, tests of have Investor $X,XXX trends an the our to our our was GuardantXXX the ASPs at GuardantXXX an we and on both paid been XXXX, in from improvements we've paid Slide we've significant stated reimbursement again ASP received for speed in third strong XX. the our In Investor by increase amounts which to and commercial goal GuardantXXX. ASP $X,XXX for XXXX,

Achieving X reimbursement strategic milestone a pleased we're team. very ahead goal report $X,XXX of years excellence our long-term of quickly a As testament GuardantXXX XXXX, so result, achieved we to ASP that QX operational target. roughly in our the and this is of to

illustrates half our half being $XX than which relates for was this and in our In throughout cash collect tests significant $XX GuardantXXX performed in our collected QX addition, which in commercial tests the noting cash worth to of in for reimbursement led XXXX, In has million million has tests. the improvement in us of to periods It's now more above upside, we're revenue upside more the than first that how performed resulted tests, consistently quickly expectations. prior year. expected turn out-of-period XXXX, for reimbursed

we the is upside, that few believe forward, $X,XXX sustainable revenue the further and over opportunity anticipate don't it Going improve we we GuardantXXX new ASP next our out-of-period have of although years. similar to future

on Moving on XX. Slide to non-GAAP measures financial

completed expansion spend, a the of support savings in expense expense the partially of driven cost to gross planned increase trial an launch to very enrollment year by towards non-GAAP Our This Shield. compared were by which XX% to in $XX was excluding third quarter. of due in screening, XXXX. sales end increase and ECLIPSE of was to primarily Non-GAAP the reduction offset strong the continues margin, the million, and million commercial marketing increase was operating clinical quarter R&D in and XXXX. $XXX.X expenses prior of be The

our operating to drive we've oncology. expenses control our the projects spend built growth towards across accelerate line tightly support focusing our screening infrastructure businesses, of both to to leveraging will all the by marketing directing and our continue and investments and R&D future by We on that incremental sales revenue by

$XX.X both XXXX, our Free Adjusted cash XXXX. flow of QX and operating improved from QX $XX.X to million revenue increased XXXX. continue million the $XX.X third XXXX cash which of EBITDA our third a $XX.X enable sufficient cash is was free of cash, decrease million EBITDA quarter in loss by was for million improvement and QX $XX.X believe year-over-year result billion we of ended breakeven a XXXX. QX achieve of leverage, As flow XXXX adjusted our negative in an us XXXX. in the in quarter approximately with from to to million, $X goal reaching of We flow

We the target bring also cash date. reduce and flow achieving cash help years few target forward total will of burn ahead of that the of GuardantXXX could breakeven $X,XXX, over our ASP believe next XXXX, our well our

our XXXX to assumptions and on Slide turning year outlook full for Now, the XX.

we to $XXX to million, our expect year XXXX of XX% in full XX% revenue year cash This reflects representing this provided the revenue the full to the we in initial of $XXX from XX% We able this to revenue compares higher our latest that to February revenue year Shield. growth increase million to revenue of are be compared in third guidance upside be XXXX. and increase now time pleased guidance had the in This for collection XX% to and further GuardantXXX third for biopharma approximately ASPs, quarter, improvement of expectation to our contribution range the year.

million operating XX% flat expect non-GAAP gross year-over-year. margin, $XXX range be excluding to in be decline to X% We to in to to to XX% the representing the continue million, $XXX a screening, and non-GAAP range expenses of of

XXXX million to to of to for to negative improvement in expectations negative prior In of million to million. to our $XX $XXX the compared compared an $XXX million, addition, we now expect $XXX and range of flow an free improvement $XXX be million cash $XX XXXX million

business year cash full will the will free Therapy positive cash and approximately for be continue to flow XXXX year Selection million. expect We burn this deliver that our screening $XXX

granular we like some share commentary next year. February, while considerations Finally, would reserve to initial as in to typically earnings QX we think about out-year our you

With traction we growth of acceleration Biopsy, expect seeing our volume the Liquid in LDT positive we're Smart XXXX. GuardantXXX an from in GuardantXXX on launch

XXXX, As will we XX% a result TissueNext, growth accelerate including strong growth contributions which of volume this Reveal continued Shield, to without both clinical we and in separately. expect above oncology and report expected from across even

business our of Slide to areas turning milestones across year. significant catalysts. progress to XX review our this We've Finally, on made each

ahead look selection, opportunities by that, questions. therapy and will to call of we across the to As open MRD screening. With excited we the very we XXXX, are potential rest now the

Operator

first [Operator question Our Instructions] Bill goes of Craig-Hallum. to Bonello

William Bonello

wisdom then a even recommendations second payers differently even on where guys. is you've Shield Question universally. reimbursement quarter, sales where USPSTF that? great terms think part aggressive to of at that's all with on you Medicare of parts the people the makes Or plans, you pricing if be reimbursement. actually before pretty secure that commercial your conversations if what One, strong, be think the on -- about case had marketing how Congratulations to that I'm is you it. just ADLT on efforts. And looking of to with degree might early need if you the secure at sort that curious curious conventional you sort obviously all I'm and of you just might X able initial think in without

AmirAli Talasaz

question. Thanks, for Bill, the

that It in have of for Shield And of the maximum level years. all that $XXX we meet in this very as and are have following need in very made commitment to the and spend Medicare to a I'm of this ramp would our to even now get our business to investment even our of investment. million still But, continue the level are innings, achieved, see going pricing to is scale that have. we margin level reiterated ADLT, kind volume very we us gross We $XXX So many terms very about pleased around this innings we opportunity. we that year, soon milestones, that got. to that guidance. to under test start with of for of that we we scenarios, I -- investments early to reiterate of to that very, ASP gives you effectively are as XXXX we but When pleased milestones milestones XXXX. think you actually approximately have $XXX, early want monitor the go the for lot obviously, meeting I'm the we the we be about that can going before milestones that assuming going revenue our as million a continue to is that volume are reasonable commercialization. we And

of are But very sitting. positive financial with our pleased the we that very, So change going these it doesn't we of level discipline to is are where developments mean investment.

In Having accessibility that, milestone side, at yes, us market, for look terms the today patient is continue the this XX lot which now enable would of major covered that as said commercial we on to of a very USPSTF, for the to USPSTF XX. younger is deep. of a segment

USPSTF. We for very inclusion market. There this -- very a is have business and we a a guideline mind deep lot of is are while to waiting

that in So have to there that guideline going guidelines on mandates now just mind, that some mind for and inclusion a of are that guideline. have it's we not near healthy Society of business There's in a state-based on select keep be are also state-level we could -- future. especially gross they to lot American have. we Cancer is impact And that that, have here, margin the waiting to going

Operator

question to The of goes Massaro BTIG. next Mark

Mark Massaro

Congrats on quarter. the

in I hear hoping how to Shield of some doing the think us field. were perhaps is

Day, price $XXX million that $XXX about of plus. be the tests, just I maybe, But people can metrics or would I any at Shield I question sense, of for think this us you your assumed helpful. And ordering field? like a the is somewhere in a out Mike for just I target mid-thousands AmirAli, report low- say feedback that then providers that you're to tests. give I a think -- on next plus think know most XXXX X plan thought heard you Analyst you to the in million hearing by quarter.

Your up already Medicare $XXX and $X,XXX. at price may is set to go

see you that to provided sure at Analyst making likely some the that Day. just upside you So guys initial target

AmirAli Talasaz

sure, for good Yes, Mark. Thanks question.

we progress. breaking very but we expectation. volume The of our are you, with like volume initial are can this So I post-launch pleased ahead Shield at not out time, tell the is

months had X continues good a that it. now a couple into exited We We months October, and are good of for with was momentum, build not last quarter to for still quarter, We but us. in momentum quarter XQ last us. had good this a full quarter

to it's fully QX the that too to traction So But contribution numbers based in do early and we break the seeing, QX it are volume on our we of report revenue call. intend out. and Shield

I'm test, is at prepared done, is very, forward depth which people blood very ready market this healthy deep very primary like more and is target looking is the sharing our we more unscreened of patient The we rescreening deep I that us option has expected reality for an enthusiastic what for about population adding execution. who to and endorsement giving as of care feedback, time. The the in is, commercial choice, been ordering market market. this going of are how the just remarks, the frankly physicians we've details very but are than the proud this for very this of a So to them actually, mentioned as are the after market positive. patients

this to in we looking are details forward ordering I'm strong too. seeing very more sharing time, depth seeing -- our actually QX of So are results. we at

Michael Bell

be million comments the set on Yes. our million And Investor to Mark, have tests. to target, on with X yes, Shield Day revenue -- XXXX target in your of $XXX we

ASP And an of $XXX. yes, implying so,

we ADLT have the the confident $XXX. above assumptions have we But I ASP When ASP, we think the Investor us $XXX it's mix. that can the versus we're gone think around then payer to Medicare I depend that our now $XXX, already few since ASPs for Day, rate, going get of think quite this I increase we mark. things on I had. the a firstly, mean, positively getting rate

one that's So thing.

X.X that, I Day our and the assumptions we in secondly, then to that And, think label. something at a assumed I least now, gone on X potential course, favor on competition about of at we years had to first-line our one August. that assuming label. think Investor it's now we the that other look would second-line akin probably more back we be the we year approximately a after were is, market market launched. And after a launch have be competition in And we that's where was, at

well new long-term I So are and very tests, X million I confident today for sit some guidance, that out think going us. about. to don't We we're want feeling think here give but things $XXX very and million

Operator

of next question The Guggenheim. Nambi goes to Subbu

Subhalaxmi Nambi

larger tumor Our indicate test what comment Therapy TAM and be number you Selection solid the that same you tests see in late-stage for metastatic could maybe ordering on GuardantXXX. opportunity, recent patients anticipated for a may we respect TAM KOL with the to GuardantXXX testing the repeat like of checks your than previously as even during IPO, the given what for patient? And repeat XXX,XXX

Helmy Eltoukhy

patients now, depth we is new patient -- a second-line, patients are see stop you there test to therapies. that needs as in our that and essentially of been cycled therapies lifetime. year you management that great the thank they for first-line, to adaptive just There And get think on market at third-line working something there right Therapy therapy. their focused last Investor to Day question. what we per are for call the getting has X Selection now No, a It's Yes. outlined to I X in be X,

space their Therapy that the future orders can see testing is they're X think for seen, a very saw partners magnitude. people where new before or biopharma just And X, X, market drugs. future testing -- over like us. We're of what a last biopharma Selection multiple why these growing market so, grows few We we've their samples are that's the see patients the the where record that obviously multiple quarters getting about we And which yes, volume lifetime, biopharma. times, I seeing considerably. struggling with by with that's our we And in times tests excited patients we're were some over of

I outlier to going in the side. now And further clinical an that there. you're further are clinical think that's We momentum testing. And translating translate to to see

complete really biopsy see can't frankly, because So, patients is really can a this panel biopsies what only where really liquid and way. new with an to hit this from tissue our yes, take most think capture growth consider best multiple easy I we you puts the upgraded important in we driver to that, really of us And times liquid as position be in full having sort biopsy market. performing the market that in

Operator

next of Jefferies. The goes Tycho question to Peterson

Tycho Peterson

year? And On size coverage of million next survivors. conferences potential you framework I'm year. your around I ASP? COSMOS, can us number surveillance the you for was it how $X,XXX. just you think You give you're more do talked you Can upside can next of about potential last you I a ASP But you what by at XX about And quarter the did number? we give there? but Medicare, us paid know the about if could from or Reveal ASPs million XX XX% cancer $X,XXX wondering then target year? obviously reiterating September Any have talked next year? back when put know are do GXXX patients it help the being

Helmy Eltoukhy

target year, mean, I next I for the take can Tycho. maybe XX% Yes.

driven acceleration XX% that on an year. we we seen call -- we've expect one, this particularly LDT. the then growth, GuardantXXX clinical yes, that And volume volume we growth, So in by still for just the reiterated

said but and and we Reveal then so, good we acceleration, talked driving the CRC we've well. get as traction fact And be cost per And driven or on acceleration with we volume many seeing we go into that we're as side down. going to TissueNext is that additional about by focused GuardantXXX, this times, reimbursements the with bring Reveal XXXX, surveillance and test also that

from So to gross we negative gross margin a margin. move positive a Reveal being

things. on So those we're traction of making good all

depend margins volume. that in on have we Medicare. to significantly that to the the get an CRC from It's push to reimbursement uptick get yet. so, it's accelerate think allow next as MolDX, to ASP. Reveal uptick going the put go we to difficult And again, surveillance accelerator year. bit us we And on assuming into gross have and positive, the I we'll from an foot quantify rate XXXX, our It's yes, But being going uptick a to the with reimbursement we'll

Operator

of The next goes Leerink Souda to question Puneet Partners.

Puneet Souda

XXXX, It's that. great I CRC the at mean, A quarter. here $XXX to you're you're in Shield, liquid I data have VX any emerge is in going think other ahead fourth bigger be question in Medicare will the to that, market. and see could biopsy screening for material it but competitor before of test potentially a

Shield this So now that provide could you please your a since CRC for penetration market timing data? the what August? since is having also, VX of on assumption And market in

AmirAli Talasaz

Puneet. Thanks, Yes.

we in of to in that upgrade continue data Shield VX is that VX, So data expect terms having and potentially positive, XXXX. our so if Shield

we making there. progress So are

really it, any we so of market our of terms don't In months share have terms are in into screening X just CRC market yet. material share today, we test, blood

have what terms earlier, Mike in time. projection, blood-based mentioned at as of In more going have we Investor would in And million, are by screening CRC that be last the we some of our competition progress what XX% market we kind time, we there assume share to in at observed. than that Day our assumption of the shared the long-term we X fall assume in

reimbursement but We get we'll Medicare years. least or any the out. next how -- competing years, So and the for see market X.X FDA would see don't tests expect shape to other at to approval X

So very good [indiscernible].

Operator

goes Canaccord. next Kyle to of Mikson The question

Kyle Mikson

Congrats quarter. on the

For are XX% the the what's those has rates 'XX. GXXX? as growth? And initial in delta retaken essentially, reordering updates has Like of How have of since collections over guide percentage core been of in your What much XX% pricing many for growth 'XX. Shield looking is patients an so and XX% guidance by the What like That AmirAli, LDT point growth like to quickly expectations? been XX% that to period May early How Medicare available XX updated test? these to far? for XXXX. for compares Mike, implied are the revenue the the those prior from

Michael Bell

$X in prior then and that Yes, QX in had, from we've QX $XX $X reported the we cash million million. of then sort period upsides million and Kyle,

$XX is of million, that that $XX so QX total. in from $X But and of So coming QX. million million XXXX, within

it's roughly these out-of-period upside, from million. around $XX effectively, So

growth growth. So the business. volume and been Primarily, course, increased of the side. reiterated in volume have incredible seen to GuardantXXX that clinical other, we've the biopharma been It's obviously, $X,XXX at drivers We of the on ASP. that's GuardantXXX then, that's the again performance now that,

all business across really sort prior we've million the upsides. that growth year got top the So, from of on of drivers of $XX additional

AmirAli Talasaz

LDT you launched Kyle, reordering Regarding May rate, of 'XX. we the mentioned, like as in

and -- our So is X every interval years. recommended

get part that be for year see can would reached towards would probably haven't of like -- retested. That that of have some later fraction we So next we what maybe time those patients to something data. window

Operator

to The Stanley. Tejas next Savant question goes of Morgan

Tejas Savant

one on GXXX one Maybe and I'll with on then screening. start

that on next rate one growth volume year in clinical Mike, sort exceeding So, for you XX%. of

Smart the You've LB got upgrade.

dynamic sort ESRX You've got now you. the behind of squarely

of You a And have August? setup the in for initial new have versus called should lab volume, the the things, little down as of So days for year? And that health Just some had well and to volume the right? which sense benchmark can it weighing half you've mean scores? that volume quality early quantum board these through, recent a put testing. of XX% come from what share learned in you as Reveal for ordering any what terms Shield next that side you and on reimbursement next stool-based year, of could Shield the the for sort on help of impact bit the back accounts on point any coming acceleration versus of of around ramp can get much lessons you've out surveillance systems, the cetera, weather floor finer on then of AmirAli, we into for the you and process 'XX pushback et sort how try got trying post

Michael Bell

year. be Tejas. X approximately what weather one ESR we've track difficult volumes, the on the still to in but XX% first be comps impacts, seen I'll we're take with on XXXX Yes, with the this Yes, growth And volume prepared all driven in again, out I laid And that, products I XXXX XX%. above very, growth oncology to confident but accelerate clinical out in that the remarks, we're on side. very by across yes, think growth the the you laid that's will going

LDT again, we're good So, traction the Liquid GuardantXXX, Biopsy seeing yes, and Smart with upgrade. the really

XXXX. to had upgraded product and an seen traction launch we nice So into going that recently, is we've TissueNext, going volume we there. know that, Again, just accelerate

-- point And that out accelerating. growth on the is and Reveal XXXX. we can upside start in you once can so, that And accelerate laid volumes again, at some we the have to

I here than I we the we be confident across don't But sit to think side above the products think business. on the all So accelerating specific more want XX%. of very oncology

AmirAli Talasaz

front orders the draw early have these But digital incorporated EMR with have and services we Starting integration, being of that launch about are days kind this that that work it's very we Shield getting market, of learnings experience days. [ definitely even coming terms we blood experimentation of since very, ] solutions connection our of from accounts full a just XX% to EMR have, that workflows those successful in even on from have market, we X, the in LDT integration. feedback August those lot really we in still,

support this we We are strong built very early the innings in I'm strong foundation very that with pleased of launch. to it, but

relevant. score, In relevant that's parameter. terms of very very That's quality

after of lot not part accounts health kind of system a going ones our higher that or sensitivity have targeting, the around As quality we the are score.

has kind data. score colonoscopy But come believe through time. and of patients getting the metrics of to CRC we then go that's in get the screening test we continue a toward unscreened have potential quality But those that around this improve guidelines table which the fraction of based blood-based them very accounts after of actually quality scores to a a Shield as modality not and terms of high parameter inclusion testing the until to either blood are without targeting on fact adjusted. sensitivity We adoption even over gets material the

Operator

The of Cowen. Brennan next question Dan goes to TD

Daniel Brennan

in provide contribution on kind I'll what portend would some breast color or kind For MolDX think and submitted the And any what's then And just to know when I going, Maybe publication, COSMOS, you provide I on ask the X the hear quarter is Could before Could for more Could you how color of just give that on any in the slide, back? color expected I process in the the you months ago. you assumed Reveal. you terms filing? of year-end. expect so is maybe of think, put XQ? indication? in you

Helmy Eltoukhy

the There first. and CRC of line. of clarification data, the and we're that been progress still sometime good I'll get a the take Yes, the process Mike half reimbursement take hopeful be has early surveillance the terms -- let couple made should good indication, able breast the second We've around data. we're forth over we for some the in but and with finish making of to year, progress. back next

comes we it We important breast submit year getting journal. And should we should a year accepted MRD, really But sort terms good have be the us then the think fast in relevant the of our for of with expect depend gets to and that, then, indications coupled will how for out largest on And us publication. soon X that COGS belts. that it under yes, by very shape. obviously, major reduction put in CRC in and next initiatives

Michael Bell

coming Yes. of from Dan, driver the sequential was that sequential Reveal. biggest of can the was of not the growth growth Reveal. that place the and Reveal, majority revenue on you for growth, sequential the breaking I second Maybe GuardantXXX. we're volumes contribution to But the the out or tell

even growing still it's managing volumes. those though So we're nicely, very

And so, and we sequential nice saw growth. year-over-year from nice Reveal growth

year Reveal. looking we're for well. really going forward pivotal again, it's And being So XXXX a to

Operator

Dan next to goes The Stifel. Arias of question

Daniel Arias

that like Mike, volumes how much next on it to year, a surveillance guess, less what's process on talking the date? that are I to acceleration you Japan for reimbursed about does in on acceleration into and the on then by attributing your out Do if just gets Reveal, you point there? And as confidence have XXXX? clinical dragged maybe, international bit a U.K., clarification a board depend that contribution particular growth you're getting

Michael Bell

going say, U.S. traction Yes, growth where a Liquid volume. GuardantXXX overall the it's the acceleration to the still be would I with of percentage next International, seeing the Smart LDT that's GuardantXXX we main is And again, as Dan. low in year main see on Biopsy. our Yes, still driver we're again, relatively

in the managing what and particularly we I think, we're progress good for good So Reveal. see internationally dwarfed But per reducing see yes, We're seeing really making going Europe for growth we by I U.K. cost We're on Reveal. to again, on growth test be growth. that it's in think and really, still to U.S. And the expect the Reveal,

be And put so, and we implemented relatively future. hope that, place relatively near in that can the in --

when without test think surveillance positive where on CRC Reveal CRC that without to at comes, per a Reveal at low we'll cost even we reimbursement, surveillance margin and gross then lot start push really even I can push reimbursement. end we'll place accelerate the volumes and a And we harder. of our So, is move obviously, to be being a can that

expect CRC I in we to still see the that is but to just reimbursement, an acceleration going think surveillance allow Reveal, lot really reimbursement to a So yes, think, push us I regardless of harder.

Operator

goes Research. question Eve to Bernstein next The Burstein of

Eve Burstein

that on actually up international following just Maybe question.

Shonan Europe. said be source attributed in will and in that Japan you [Technical big down site GXXX Difficulty] research And that center October, actually You for slow uptake Japan of specifically. before to indicated in they your shut a then primarily in U.S. the drivers GXXX in new launch it and late

and characterization short fair seeing a down? on you in there And color your you can GXXX commercial medium shut term? add more for And expectations what you traction are the in that is are why So the the that Japan? that of

Helmy Eltoukhy

It point it's not progress just sort exposure number something had our thought years we SoftBank the that to make Yes. there Japan. really when we that something no lab had JV, was sense had a of I of of we especially would sort going any made forward. sense at relationship the this and in mean, had ago, of was

or in some to a really way the opportunity And to ramp tissue are took that fact being the Japan, mostly slower Selection cut reimbursed for but once lifetime it's there that we the these said, with works has been only liquid. essentially, the than tests has if and little bit costs so, Therapy we over do expected that regardless reimbursement there. That a

start in we're tissue think so, a volume sort more Japan. we now. over very And preferences the And right that's role by of we has the there time, some can of tissue some But displacing encouraged we of in there. of moving programs there terms have forward of new and

So I going think still well. reasonably

of Just market given there -- it will nature structural Japan. time just take a in the the little bit more

Operator

The of next goes Wolfe Doug question Schenkel Research. to

Douglas Schenkel

$XX I A almost full you'll then quick by at one line you That's you as it. On revenue guidance, million. and on math if some try the know, the want bless guidance, at increased guidance, and to just midpoint. to year see do Shield

wondered Is it's beat? there is QX really Because if that if this the you'd than through bridge. just that? the Or Just to beat, wondering if the more just essentially it QX talk I'm just with It GXXX the skew seems momentum, upside the version rapid Shield mention bars capture on more the collections. error doesn't bump, trends to like ASP there. to and not new momentum might

points That's Shield, take about want I see you'll to gross So below a then on to was at XX%. trend. comment I'm shot just going if margin on about that. And service Development this. XX

that than pre-Shield. were have million So expected that you COGS higher suggests would maybe $X in category

stage per did test assume on your the that logic like $XXX, tests of reasonable. the the goal, in X,XXX but you point to early out? if of $XXX seems It like quarter. ramp, the to you'd it probably COGS is X,XXX seems higher which So given Any flow than we

Michael Bell

think in us Doug, guidance. Yes, increasing there's I our few a factors

$XXX it's to And million million million. million so, was $XXX it previously, $XXX and $XXX now to

few like in So, that. yes, million step-up $XX things a a at the There's something midpoint.

in we them, of talked the payments upside cash remarks. about from that I out-of-period that of is prepared and saw course, One the

the now ASPs, and consistently up GuardantXXX $X,XXX. gone The they've they're and other at is year, throughout

the GuardantXXX uplift sort we've were we on got to guiding of previously, high-teens revenue, an growth. So ASP. And then revenue biopharma

revenue high-XXs growth. guiding we're to Now,

the they're So real drivers.

have Shield. that, top now we some start contribution revenue course, to Of on of from

consistent also our we're included in of thing again, one we quarters few the at projection to that that's And over with that approximately being stayed been has So last there. clinical growth. come XX%. expecting reiterated volumes The XX% volume at clinical

where with we that. that's So are

off. can about that some yes, we is Shield think, on test. some your want I bit into a think that's the the -- One back talk sort I about trying to of of per to talk or thing of cost volumes,

$X,XXX, prior lot fixed cost cost the into launch, so, that the was of that per the cost. test to and a over built was And

launch cost so, test we've with rapidly. into as to we're per as traction started the seeing volume, that pretty down gone And now, see we've come

that expect when to positive And few to the reduce So again, now gross -- the it's continue $X,XXX, be set next we've we over target this we margin to below and get for margin neutral, quarters. gross ADLT rate.

cost so, track Shield on think And I on we're reduction well the together. with

Operator

you. today's concludes today. that Thank have we all joining. all the call. Thank questions for you time now That's for This

now may your You disconnect lines.

Guardant Health (GH) 6 Nov 242024 Q3 Earnings call transcript