Veracyte (VCYT) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue reached $114.5 million, up 18% year-over-year, driven by strong Decipher and Afirma test demand and double-digit volume growth.

• Net income was $7.0 million, a turnaround from a net loss of $1.9 million in Q1 2024, with adjusted EBITDA margin at 21.6%.

• Decipher volume rose 37% to ~22,600 tests and revenue grew 33%; Afirma volume up 10% to ~15,500 tests and revenue increased 6%.

• Strategic initiatives advanced, including Decipher's metastatic launch, Afirma enhancements, MRD platform progress, and Prosigna LDT launch plans.

• Completed integration of C2i Genomics, expanding MRD capabilities.

Financial highlights

• Testing revenue grew 19% year-over-year to $107.3 million; total testing volume rose 22% to 40,650–40,655 tests.

• Non-GAAP gross margin improved to 72% (up from 68–69%); testing gross margin at 74%.

• Adjusted EBITDA margin was 21.6% in Q1 2025, up from 14.9% in Q1 2024.

• Operating expenses grew 14% to $76.6 million; non-GAAP operating expenses were $60.5 million.

• Cash and short-term investments totaled $287–$287.4 million at quarter-end.

Outlook and guidance

• 2025 testing revenue guidance reiterated at $470–$480 million (12–15% growth); adjusted EBITDA margin guidance raised to 22.5%.

• Q2 expectations: sequential increase in testing revenue, modest gross margin step down due to Marseille site, product revenue ~$2.5 million, biopharma/other ~$1.5 million.

• Key launches expected: Decipher for metastatic patients (June 2025), MRD platform (1H 2026), Prosigna LDT (mid-2026).