Veracyte (VCYT) investor relations material

Financial performance and operational highlights

• Q3 revenue exceeded $131 million, up 14%, with testing business growing 17% and Decipher achieving its 14th consecutive quarter of 25%+ growth, driven by new launches and increased physician ordering.

• Afirma volumes rose 13% in the quarter, supported by both new and deeper account penetration, while cost efficiencies from the V2 transcriptome improved margins and workflow.

• Achieved 30% adjusted EBITDA in Q3, surpassing expectations and leading to increased full-year guidance for both revenue and adjusted EBITDA, with a target to sustain 25%+ adjusted EBITDA in future years.

• Transition to the V2 transcriptome is expected to be complete by year-end, with full benefits realized next year, including higher test success rates and margin improvements.

• Capital allocation remains focused on internal growth drivers, with M&A as a secondary priority; cash position expected near $400 million with no debt.

Market penetration, product adoption, and growth drivers

• Decipher market is about 40% penetrated, with uniform adoption across NCCN risk groups and further demand expected as new indications and guidelines evolve.

• Afirma market penetration is estimated at 65%, with a goal to reach 80% share, driven by both penetration and share gains, especially in B3/B4 patient segments.

• New account maturity and strong customer support are key to increasing physician and practice-level adoption, with both number of ordering physicians and orders per practice trending upward.

• NCCN guideline updates and evidence from clinical trials have provided tailwinds for Decipher and Afirma, though the impact is intertwined with broader evidence dissemination.

• Prosigna LDT launch is planned for mid-2026, with commercial efforts ramping up, focusing on KOL engagement and collaboration ahead of the OPTIMA trial readout.

Innovation, competitive positioning, and future initiatives

• Digital pathology and AI are seen as complementary to transcriptomic testing, with ongoing validation and integration efforts to ensure robust clinical utility.

• Decipher remains the preferred test among physicians due to strong validation, with studies showing significant discordance with competing digital pathology solutions.

• MRD assay for muscle invasive bladder cancer to launch in the first half of next year, targeting post-cystectomy patients, with further annual indication expansions planned.

• MRD platform expected to reach 25% adjusted EBITDA over time, with initial gross margin pressure offset by scale, pricing, and leveraging existing sales channels.

• Investments continue in multi-omic platforms, digital pathology, and cloud infrastructure to enhance data integration and product development.