BRISBANE, Calif.–(BUSINESS WIRE)–CareDx, Inc. (Nasdaq: CDNA) – today announced financial results for the second quarter ended June 30, 2024.
Second Quarter 2024 Financial Highlights
Reported total revenue of $92.3 million, an increase of 31% year-over-year.
Grew Testing Services volume to 43,700 tests, an increase of 17% year-over-year.
Reported GAAP net loss of $1.4 million, non-GAAP net income of $13.6 million, and positive adjusted EBITDA of $12.9 million, a significant improvement from the second quarter 2023.
Generated $18.9 million cash from operations. Ended the quarter with cash, cash equivalents, and marketable securities of approximately $228.9 million, with no debt.
Raised 2024 guidance for annual revenue to $320 to $328 million and adjusted EBITDA to a gain of $9 to $15 million.
Business Highlights
In the first half of 2024, expanded coverage by 27 million lives nationwide.
Published SHORE study data demonstrating that HeartCare® outperforms dd-cfDNA alone in identifying allograft rejection.
Nature Medicine publication validates CareDx AlloView™ AI-enabled risk prediction model and demonstrates AlloSure® Kidney detects subclinical rejection in stable patients.
“We are pleased to announce another strong quarter, marked by growth across all our businesses. The hard work of our team and their dedication to serving transplant patients over the past year have been instrumental in our performance. As we approach the second half of the year, we remain focused on driving growth,” said John W. Hanna, CareDx President and CEO.
Second Quarter 2024 Financial Results
Total revenue for the three months ended June 30, 2024, was $92.3 million, an increase of 31% compared to $70.3 million for the second quarter of 2023. Testing Services revenue for the second quarter 2024 was $70.9 million, an increase of 33% compared to $53.4 million for the second quarter of 2023. Testing Services revenue for the second quarter 2024 included $13.2 million for tests performed in prior periods. Patient and Digital Solutions revenue for the second quarter of 2024 was $10.7 million, an increase of 19% compared to $9.0 million for the second quarter 2023. Product revenue for the second quarter of 2024 was $10.6 million, an increase of 35% compared to $7.9 million for the second quarter 2023.
For the second quarter of 2024 net loss was $1.4 million compared to a net loss of $25.0 million in the second quarter of 2023. Basic and diluted net loss per share in the second quarter of 2024 was $0.03, compared to basic and diluted net loss per share of $0.46 in the second quarter of 2023.
Non-GAAP net income was $13.6 million in the second quarter of 2024, compared to a non-GAAP net loss of $9.9 million in the second quarter of 2023. Diluted non-GAAP net income per share was $0.25 in the second quarter of 2024, compared to a diluted non-GAAP net loss per share of $0.18 in the second quarter of 2023.
Adjusted EBITDA income for the second quarter of 2024 was $12.9 million, compared to an adjusted EBITDA loss of $10.4 million for the second quarter of 2023.
2024 Guidance
CareDx now expects full year 2024 revenue to be in the range of $320 million to $328 million, compared to the prior range of $274 million to $282 million. CareDx now expects full year 2024 non-GAAP gross margin to be in the range of 67% to 68%, compared to the prior range of 63% to 65%. CareDx now expects full year 2024 adjusted EBITDA gain to be in the range of $9 million to $15 million, compared to an adjusted EBITDA loss of $14 million to $24 million.
About CareDx – The Transplant Company™
CareDx, Inc., headquartered in Brisbane, California, is a leading precision medicine solutions company focused on the discovery, development, and commercialization of clinically differentiated, high-value healthcare solutions for transplant patients and caregivers. CareDx offers testing services, products, and digital healthcare solutions along the pre- and post-transplant patient journey and is the leading provider of genomics-based information for transplant patients. For more information, please visit: www.CareDx.com.
Forward Looking Statements
This press release includes forward-looking statements, including expectations regarding CareDx’s 2024 revenue, non-GAAP gross margin and adjusted EBITDA, CareDx’s focus in 2024 and CareDx’s proposed path to profitability. These forward-looking statements are based upon information that is currently available to CareDx and its current expectations, speak only as of the date hereof, and are subject to numerous risks and uncertainties, all of which are difficult to predict and many of which are beyond our control, including general economic and market factors, among others discussed in CareDx’s filings with the Securities and Exchange Commission (the “SEC”), including, but not limited to, the Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed by CareDx with the SEC on February 28, 2024, the quarterly report on Form 10-Q for the quarter ended March 31, 2024 filed by CareDx with the SEC on May 9, 2024, the quarterly report on Form 10-Q for the quarter ended June 30, 2024 filed by CareDx with the SEC on July 31, 2024 and other reports that CareDx has filed with the SEC. Any of these may cause CareDx’s actual results, performance, or achievements to differ materially and adversely from those anticipated or implied by CareDx’s forward-looking statements. You are cautioned not to place undue reliance on these forward-looking statements. CareDx expressly disclaims any obligation, except as required by law, or undertaking to update or revise any such forward-looking statements, whether as a result of new information, future events or otherwise.
Use of Non-GAAP Financial Measures
CareDx has presented in this release certain financial information in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”) and also on a non-GAAP basis, including non-GAAP cost of testing services, non-GAAP cost of product, non-GAAP cost of patient and digital solutions, non-GAAP research and development expenses, non-GAAP sales and marketing expenses, non-GAAP general and administrative expenses, non-GAAP other income, net, non-GAAP income tax expense, non-GAAP gross profit, non-GAAP gross margin (%), non-GAAP net income (loss), non-GAAP basic and diluted net income (loss) per share, adjusted EBITDA and non-GAAP operating expenses.
We define non-GAAP net income (loss) and per share results as the GAAP net loss and per share results excluding the impacts of stock-based compensation; changes in estimated fair value of contingent consideration; acquisition-related impairment charges and amortization of purchased intangible assets and related tax effects; costs involved with completing an acquisition; unrealized loss on investments; restructuring charges and certain other charges.
We define adjusted EBITDA as non-GAAP net income (loss) before interest income, income tax expense (benefit), depreciation and other expense, net.
We are presenting these non-GAAP financial measures to assist investors in assessing our operating results through the eyes of management and because we believe that these measures provide an additional tool for investors to use in comparing our core business operating results over multiple periods. Management believes this non-GAAP information is useful for investors, when considered in conjunction with CareDx’s GAAP financial statements, because management uses such information internally for its operating, budgeting, and financial planning purposes. Non-GAAP information is not prepared under a comprehensive set of accounting rules and should only be used to supplement an understanding of CareDx’s operating results as reported under GAAP. These non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. These non-GAAP financial measures are not necessarily comparable to similarly titled measures presented by other companies. A reconciliation between GAAP and non-GAAP financial information is provided immediately following the financial tables.
CareDx, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
(In thousands, except share and per share data)
Three Months Ended June 30,
Six Months Ended June 30,
2024
2023
2024
2023
Revenue:
Testing services revenue
$
70,918
$
53,414
$
124,755
$
115,198
Product revenue
10,610
7,876
19,204
14,737
Patient and digital solutions revenue
10,746
9,011
20,364
17,628
Total revenue
92,274
70,301
164,323
147,563
Operating expenses:
Cost of testing services
14,308
15,324
27,940
30,620
Cost of product
6,245
3,926
11,589
7,992
Cost of patient and digital solutions
7,393
6,637
14,351
13,241
Research and development
19,678
20,233
38,389
44,590
Sales and marketing
21,002
21,630
40,832
44,861
General and administrative
27,678
29,327
54,589
57,359
Restructuring costs
68
848
68
848
Total operating expenses
96,372
97,925
187,758
199,511
Loss from operations
(4,098
)
(27,624
)
(23,435
)
(51,948
)
Other income:
Interest income, net
2,826
2,871
5,711
5,537
Change in estimated fair value of common stock warrant liability
—
3
—
10
Other expense, net
(100
)
(271
)
(390
)
(2,245
)
Total other income
2,726
2,603
5,321
3,302
Loss before income taxes
(1,372
)
(25,021
)
(18,114
)
(48,646
)
Income tax (expense) benefit
(22
)
68
61
(56
)
Net loss
$
(1,394
)
$
(24,953
)
$
(18,053
)
$
(48,702
)
Net loss per share:
Basic
$
(0.03
)
$
(0.46
)
$
(0.35
)
$
(0.91
)
Diluted
$
(0.03
)
$
(0.46
)
$
(0.35
)
$
(0.91
)
Weighted-average shares used to compute net loss per share:
Basic
52,195,620
53,846,260
51,943,989
53,745,299
Diluted
52,195,620
53,846,260
51,943,989
53,745,299
CareDx, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
(In thousands)
June 30, 2024
December 31, 2023
Assets
Current assets:
Cash and cash equivalents
$
95,782
$
82,197
Marketable securities
133,089
153,221
Accounts receivable
66,161
51,061
Inventory
19,234
19,471
Prepaid and other current assets
6,343
7,763
Total current assets
320,609
313,713
Property and equipment, net
34,202
35,246
Operating leases right-of-use assets
27,188
29,891
Intangible assets, net
41,896
45,701
Goodwill
40,336
40,336
Restricted cash
588
586
Other assets
1,958
1,353
Total assets
$
466,777
$
466,826
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable
$
5,874
$
12,872
Accrued compensation
25,004
19,703
Accrued and other liabilities
47,453
45,497
Total current liabilities
78,331
78,072
Deferred tax liability
50
136
Deferred payments for intangible assets
1,620
2,461
Operating lease liability, less current portion
25,386
28,278
Other liabilities
96,721
96,551
Total liabilities
202,108
205,498
Commitments and contingencies
Stockholders’ equity:
Common stock
50
49
Additional paid-in capital
969,427
946,511
Accumulated other comprehensive loss
(7,964
)
(6,963
)
Accumulated deficit
(696,844
)
(678,269
)
Total stockholders’ equity
264,669
261,328
Total liabilities and stockholders’ equity
$
466,777
$
466,826
CareDx, Inc.
Reconciliation of GAAP to Non-GAAP Financial Measures
(Unaudited)
(In thousands)
Three Months Ended June 30,
Six Months Ended June 30,
2024
2023
2024
2023
Cost of testing services reconciliation:
GAAP cost of testing services
$
14,308
$
15,324
$
27,940
$
30,620
Stock-based compensation expense
(357
)
(492
)
(814
)
(971
)
Acquisition related-amortization of purchased intangibles
(329
)
(329
)
(658
)
(658
)
Non-GAAP cost of testing services
$
13,622
$
14,503
$
26,468
$
28,991
Cost of product reconciliation:
GAAP cost of product
$
6,298
$
3,926
$
11,642
$
7,992
Stock-based compensation expense
(225
)
(274
)
(542
)
(634
)
Acquisition related-amortization of purchased intangibles
(411
)
(416
)
(831
)
(834
)
Restructuring costs
(53
)
—
(53
)
—
Non-GAAP cost of product
$
5,609
$
3,236
$
10,216
$
6,524
Cost of patient and digital solutions reconciliation:
GAAP cost of patient and digital solutions
$
7,393
$
6,651
$
14,351
$
13,255
Stock-based compensation expense
(350
)
(367
)
(722
)
(769
)
Acquisition related-amortization of purchased intangibles
(238
)
(255
)
(509
)
(503
)
Restructuring costs
—
(14
)
—
(14
)
Other income
—
—
5
—
Non-GAAP cost of patient and digital solutions
$
6,805
$
6,015
$
13,125
$
11,969
Research and development expenses reconciliation:
GAAP research and development expenses
$
19,693
$
20,478
$
38,404
$
44,835
Stock-based compensation expense
(1,628
)
(1,704
)
(3,388
)
(3,666
)
Restructuring costs
(15
)
(245
)
(15
)
(245
)
Other charges
—
—
(25
)
—
Non-GAAP research and development expenses
$
18,050
$
18,529
$
34,976
$
40,924
Sales and marketing expenses reconciliation:
GAAP sales and marketing expenses
$
21,002
$
22,178
$
40,832
$
45,409
Stock-based compensation expense
(2,927
)
(2,779
)
(5,971
)
(6,516
)
Acquisition related-amortization of purchased intangibles
(628
)
(606
)
(1,261
)
(1,201
)
Restructuring costs
—
(548
)
—
(548
)
Other charges
—
—
(8
)
—
Non-GAAP sales and marketing expenses
$
17,447
$
18,245
$
33,592
$
37,144
General and administrative expenses reconciliation:
GAAP general and administrative expenses
$
27,678
$
29,368
$
54,589
$
57,400
Stock-based compensation expense
(7,683
)
(7,084
)
(15,077
)
(13,898
)
Change in estimated fair value of contingent consideration
(210
)
(67
)
(529
)
(488
)
Acquisition related fees and expenses
(5
)
—
(40
)
(284
)
Restructuring costs and charges
—
(41
)
—
(99
)
Other (charges) income
(44
)
—
22
—
Non-GAAP general and administrative expenses
$
19,736
$
22,176
$
38,965
$
42,631
Total other income (expense) reconciliation:
GAAP other income, net
$
2,726
$
2,603
$
5,321
$
3,302
Unrealized (gain) loss on long-term marketable equity securities
—
(53
)
—
857
Asset impairments and write-downs
—
—
—
1,000
Other charges
—
7
—
28
Non-GAAP other income, net
$
2,726
$
2,557
$
5,321
$
5,187
Income tax (expense) benefit reconciliation:
GAAP income tax (expense) benefit
$
(22
)
$
68
$
61
$
(56
)
Tax effect related to amortization of purchased intangibles
(98
)
(100
)
(200
)
(201
)
Non-GAAP income tax expense
$
(120
)
$
(32
)
$
(139
)
$
(257
)
CareDx, Inc.
GAAP and Non-GAAP Operating Expenses
(Unaudited)
(In thousands)
Three Months Ended June 30,
Six Months Ended June 30,
2024
2023
2024
2023
GAAP operating expenses:
Research and development
$
19,693
$
20,478
$
38,404
$
44,835
Sales and marketing
21,002
22,178
40,832
45,409
General and administrative
27,678
29,368
54,589
57,400
Total GAAP operating expenses
$
68,373
$
72,024
$
133,825
$
147,644
Non-GAAP operating expenses:
Research and development
$
18,050
$
18,529
$
34,976
$
40,924
Sales and marketing
17,447
18,245
33,592
37,144
General and administrative
19,736
22,176
38,965
42,631
Total Non-GAAP operating expenses
$
55,233
$
58,950
$
107,533
$
120,699
CareDx, Inc.
Reconciliation of GAAP to Non-GAAP Gross Profit and Gross Margin
(Unaudited)
(In thousands, except percentages)
Three Months Ended June 30,
Six Months Ended June 30,
2024
2023
2024
2023
Total revenue
$
92,274
$
70,301
$
164,323
$
147,563
GAAP cost of sales
27,999
25,901
53,933
51,867
GAAP gross profit
64,275
44,400
110,390
95,696
Stock-based compensation expense
932
1,133
2,078
2,374
Other income
—
—
(5
)
—
Restructuring costs
53
14
53
14
Acquisition related-amortization of purchased intangibles
978
1,000
1,998
1,995
Non-GAAP gross profit
$
66,238
$
46,547
$
114,514
$
100,079
Non-GAAP gross margin %
72
%
66
%
70
%
68
%
CareDx, Inc.
Reconciliation of GAAP to Non-GAAP Financial Measures
(Unaudited)
(In thousands, except share and per share data)
Three Months Ended June 30,
Six Months Ended June 30,
2024
2023
2024
2023
GAAP net loss
$
(1,394
)
$
(24,953
)
$
(18,053
)
$
(48,702
)
Stock-based compensation expense
13,170
12,700
26,514
26,454
Acquisition related-amortization of purchased intangibles
1,606
1,606
3,259
3,196
Change in estimated fair value of contingent consideration
210
67
529
488
Acquisition related fees and expenses
5
—
40
284
Other charges
44
7
6
28
Restructuring costs and charges
68
848
68
906
Tax effect related to amortization of purchased intangibles
(98
)
(100
)
(200
)
(201
)
Asset impairments and write-downs
—
—
—
1,000
Unrealized (gain) loss on long-term marketable equity securities
—
(53
)
—
857
Non-GAAP net income (loss)
$
13,611
$
(9,878
)
$
12,163
$
(15,690
)
GAAP basic and diluted net loss per share
$
(0.03
)
$
(0.46
)
$
(0.35
)
$
(0.91
)
Non-GAAP basic net income (loss) per share
$
0.26
$
(0.18
)
$
0.23
$
(0.29
)
Non-GAAP diluted net income (loss) per share
$
0.25
$
(0.18
)
$
0.23
$
(0.29
)
Shares used in computing non-GAAP basic net income (loss) per share
52,195,620
53,846,260
51,943,989
53,745,299
Shares used in computing non-GAAP diluted net income (loss) per share
54,333,731
53,846,260
53,669,762
53,745,299
CareDx, Inc.
Reconciliation of Non-GAAP to Adjusted EBITDA
(Unaudited)
(In thousands)
Three Months Ended June 30,
Six Months Ended June 30,
2024
2023
2024
2023
Non-GAAP net income (loss)
$
13,611
$
(9,878
)
$
12,163
$
(15,690
)
Interest income
(2,826
)
(2,871
)
(5,711
)
(5,537
)
Income tax expense (benefit)
121
68
139
(56
)
Depreciation expense
1,937
2,052
4,105
3,860
Other expense, net
100
279
390
664
Adjusted EBITDA
$
12,943
$
(10,350
)
$
11,086
$
(16,759
)
Contacts
CareDx, Inc.
Media Relations
Anna Czene
818-731-2203
[email protected]
Investor Relations
Greg Chodaczek
[email protected]
