Q1 2024 Natera Inc Earnings Call

Greg: Thank you for standing by. My name is Greg, and I will be your conference operator today. At this time, I would like to welcome everyone to the Natera Incorporated Q1 Earnings Conference Call.

Thank you for standing by my name is Greg and I will be your conference operator today at this time I would like to welcome everyone to the Natera incorporated Q1 earnings conference call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session. If you would like to ask a question. During this time.

Greg: All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. And if you'd like to withdraw your question, simply press star one again. Thank you. I would now like to turn the call over to Mike Brophy, Chief Financial Officer. Mike, please go ahead.

Mike Brophy: Simply press Star followed by the number one on your telephone keypad and if you'd like to withdraw your question simply press Star one again, thank you I.

Greg: I would now like to turn the call over to Mike Brophy Chief Financial Officer.

Mike Brophy: Mike. Please go ahead.

Mike Brophy: Thanks, Operator. Good afternoon.

Mike Brophy: Thanks, operator, and good afternoon. Thank you for joining our conference call to discuss the results of our first quarter of 2024 on the line and Jamie Steve Chapman, Our CEO Solomon Boskovich President clinical diagnostics.

Mike Brophy: <unk> General manager of oncology and Chief Medical Officer, John <unk>, President and Chief Business Officer is also on the call and will be available for Q&A.

Mike Brophy: Thank you for joining our conference call to discuss the results of our first quarter of 2024. On the line, I'm joined by Steve Chapman, our CEO; Solomon Moshkevich, President, Clinical Diagnostics; and Alex Aleshin, General Manager of Oncology and Chief Medical Officer. John Fesko, President and Chief Business Officer, is also on the call and will be available for Q&A. Today's conference call is being broadcast live via webcast. We will be referring to a slide presentation that has been posted to investor.natera.com. A replay of the call will also be posted to our IR site as soon as it's available.

Mike Brophy: This conference call is being broadcast live via webcast, we will be referring to a slide presentation that has been posted to investor Natera Doctor.

Mike Brophy: Uh huh.

Mike Brophy: Replay of the call will also be closely.

Mike Brophy: Our site.

Mike Brophy: Oh.

Mike Brophy: Starting on slide 2, during the course of this conference call, we will make forward-looking statements regarding future events and our anticipated future performance, such as our operational and financial outlook and projections, our assumptions for that outlook, market size, partnerships, clinical studies, and expected results, opportunities, and strategies, and expectations for various current and future products, including product capabilities, expected release dates, reimbursement coverage, and related effects on our financial and operating results. We caution you that such statements reflect our best judgment, based on factors currently known to us, and that actual events or results could differ materially.

Mike Brophy: Starting with slide two during the course of this conference call. We will make forward looking statements regarding future events and our anticipated future performance, such as our operational and financial outlook projections.

Mike Brophy: So that outlook Mark implies partnerships clinical studies and expected results opportunities and strategies and expectations for various time and future products, including product capabilities expected release dates reimbursement coverage and related effects on us.

Mike Brophy: Please refer to the documents we file from time to time with the SEC, including our most recent Form 10-K or 10-Q and the Form 8-K files accompanying today's press release. Those documents identify important risks and other factors that may cause our actual results to differ materially from those contained in or suggested by these forward-looking statements. Forward-looking statements made during the call are being made as of today, May 9th, 2024. If this call is replayed or reviewed after today, the information presented during the call may not contain current or accurate information.

Mike Brophy: On operating results, we talked to you that such statements reflect our best judgment based on factors currently known to us and actual events or results could differ materially. Please refer to the documents we file from time to time with the SEC, including our most recent Form 10-K or compute.

Mike Brophy: The form 8-K filed with today's press release, those documents identify important risks and other factors that may cause our actual results to differ materially from those contained in or suggested by the forward looking statements.

Mike Brophy: When looking statements made during the call are being made as of today may nine 2024 at this call is replayed or would need after today. The information presented during the call may not contain current or accurate information.

Mike Brophy: The tariff claims no obligation to update or revise any forward-looking statement. We will provide guidance on today's call but will not provide any further guidance or updates on our performance during the quarter unless we do so in a public forum. We will quote a number of numeric or growth changes as we discuss our financial performance, and, unless otherwise noted, each such reference represents a year-on-year comparison.

Mike Brophy: Claims any obligation to update or revise any forward looking statements. We will provide guidance on today's call, but will not provide any further guidance or updates on our performance during the quarter unless we do so in a public forum, we will quote a number of numeric or growth changes as we discuss our financial performance and unless otherwise noted each such reference represents a year on.

Mike Brophy: On year comparison.

Mike Brophy: And now I'd like to turn the call over to Steve. Okay?

Mike Brophy: Now I'd like to turn the call over to Steve <unk>.

Steve Chapman: Great. Thanks, Mike. Let's get into the highlights on the next slide. We had an excellent quarter across the board, and I'm very pleased to share that we met a major milestone in the life cycle of the company, reaching cash flow break-even in Q1, significantly ahead of schedule. Revenues were up 18% sequentially versus Q4 of 2023 and up 52% compared to Q1 of last year, driven by record volume growth and improving ASP. Volumes were up over 17% sequentially versus Q4 of 2023, which is the fastest sequential growth rate we've seen since 2021, when volumes were less than half the size they are now.

Steve: Great. Thanks, Mike, let's get into the highlights on the next slide.

Steve Chapman: We had an excellent quarter across the board and I'm very pleased to share that we met a major milestone in the lifecycle of the company, reaching cash flow breakeven in Q1 significantly ahead of schedule.

Steve Chapman: Revenues were up 18% sequentially versus Q4 of 2023 and up 52% compared to Q1 of last year, driven by record volume growth and improving asps.

Steve Chapman: Volumes were up over 17% sequentially versus Q4 of 2023, which is the fastest sequential growth rate. We've seen since 2021, when the volumes were less than half the size. They are now we.

Steve Chapman: We had record volumes across Oncology, Organ Health, and Women's Health. In Oncology, we sold 115,000 units in the quarter, representing sequential growth of 17,000 units versus Q4 of last year, a record growth quarter for the company. Women's Health was also particularly strong, up more than 85,000 units versus Q4 of last year. Improving ASPs and continued execution on COGS reduction drove a record gross margin of 57% compared to 39% gross margin in Q1 of 2023.

Steve Chapman: We had record volumes across oncology, Oregon Health and women's health and oncology, we performed 115000 units in the quarter, representing sequential growth of 17000 units versus Q4 of last year, a record growth quarter for the company Women's health was also particularly strong up more than 80.

Steve Chapman: 5000 units versus Q4 of last year.

Steve Chapman: Improving asp's and continued execution on Cogs reduction drove a record gross margin of 57% compared to 39% gross margin in Q1 of 2023.

Steve Chapman: All of this momentum puts us in a great position to significantly raise every aspect of the guide for the rest of the year. We are now expecting revenues of $1,420,000,000 to $1,450,000,000, which is $100 million above the midpoint of the range we provided in February. We are also raising gross margins from 50 to 53 percent to a new range of 53 to 55 percent. And importantly, even as we increase investments in commercial operations and R&D, we are significantly reducing our cash burn guide for the year.

Steve Chapman: All of this momentum puts us in a great position to significantly raise every aspect of the guide for the rest of the year. We are now expecting revenues of $1.420 billion to $1 billion and $450 million, which is $100 million above the midpoint of the range. We provided in February we are on.

Steve Chapman: Also raising gross margins from 50% to 53% to a new range of 53% to 55%.

Steve Chapman: And importantly, even as we increased investments in commercial operations and R&D, we are significantly reducing our cash burn guide for the year.

Steve Chapman: Our previous range included a burn of $75 to $50 million, and we are now projecting to be cash flow break-even for the full year, plus or minus $25 million. We've also had a full slate of clinical and product announcements, including the launch of our fetal RHD test. The vast majority of NIPT labs do not offer this type of testing, and we are particularly pleased to be serving a critical unmet need given the shortage of RHIG treatments available right now in the United States.

Steve Chapman: Our previous range included a burn of $75 million to $50 million and we are.

Steve Chapman: Now projected to be cash flow breakeven for the full year, plus or minus $25 million.

Steve Chapman: We've also had a full slate of clinical and product announcements, including the launch of our fetal our HD test.

Steve Chapman: The majority of the Ni PDT labs do not offer this type of testing and we're particularly pleased to be serving a critical unmet need given the shortage of our HIV treatments available right now in the United States.

Steve Chapman: In organ health, many of you saw the updated Cadego guidelines that support genetic testing in patients with chronic kidney disease. This was great to see, particularly after the release of the excellent prospective results we read out last year with the RenaCare study. More recently, we were thrilled to see the publication of our proactive study in a top journal, which represents the largest prospective donor-derived cell-free DNA study published to date in the kidney transplant space.

Steve Chapman: In Oregon Health. Many of you saw the updated <unk> guidelines that support genetic testing in patients with chronic kidney disease.

Steve Chapman: This was great to see particularly after the release of the excellent perspective results, we read out last year with the renal care study.

Steve Chapman: More recently, we were thrilled to see the publication of our proactive study in a top journal, which represents the largest perspective donor derived cell free DNA study published to date in the kidney transplant space. We think we have strong momentum in Oregon health and we're excited about driving this forward this year.

Steve Chapman: We think we have strong momentum in organ health, and we're excited about driving this forward this year. In Oncology, we were very encouraged by the analysis released in the randomized prospective phase 3 Invigor 011 trial of bladder cancer, in which patients that remain negative on serial signataria testing had excellent outcomes. This is meaningful as it suggests that these MRD-negative patients may be able to forego treatment in favor of signatory surveillance.

Steve Chapman: In oncology, we are very encouraged by the analysis released in the randomized prospective phase III Invigorate 011 trial in bladder cancer in which patients that remain negative on cereal cigna turret testing at excellent outcomes. This is meaningful as it suggests that these <unk> negative patients may be able to forgo true.

Steve Chapman: <unk> in favor of Cigna terrorist surveillance. This is also being explicitly evaluated into modern trial, which we discussed last quarter.

Steve Chapman: This is also being explicitly evaluated in the MODERN trial, which we discussed last quarter. We also had several additional data readouts that we will cover today. We've got a full agenda for the call, and I'm excited to get into the business trends on the next slide. The first slide shows our sequential growth in volume between Q4 and Q1, both this year and last year. We had a very strong Q1 for Women's Health.

Steve Chapman: We also had several additional data readouts that we will cover today, we've got a full agenda for the call and I'm excited to get into the business trends on the next slide.

Steve Chapman: The first slide shows our sequential growth in volume between Q4 Q1, both this year and last year, we had a very strong Q1 for women's health, we saw a nice lift from the VA accounts, we picked up in January and February and the transition has been a success and we're pleased with the results.

Steve Chapman: We saw a nice lift from the Invitae accounts we picked up in January and February, and the transition has been a success, and we're pleased with the results. We also had success organically growing the business. In fact, the majority of our growth in Q1 came from organic new account wins and growth within our existing Web of Health account. Our core advantages continue to shine in the field, and we've gotten a lot of traction with the launch of our RHD product, which we'll discuss later on the call. Organ health was also a bright spot this quarter.

Steve Chapman: We also had success organically growing the business in fact, the majority of our growth in Q1 came from organic new account wins and growth within our existing women's health accounts.

Steve Chapman: Our core advantages continue to shine in the field and we've got a lot of traction with the launch of our HD product, which we'll discuss later on the call.

Steve Chapman: Health was also a bright spot this quarter, we saw strong sequential growth and prosperity on the back of the proactive publication, Irina say grew nicely as well, which is promising given that the updated <unk> guidelines came out very late in the quarter.

Steve Chapman: We saw strong sequential growth in Prospera on the back of the Proactiv publication, and Renocyte grew nicely as well, which is promising given that the updated Kidego guidelines came out very late in the quarter. And in Oncology, we delivered our best quarter ever for signatory unit growth. Double-clicking on oncology volumes on the next slide.

Steve Chapman: And in oncology, we delivered our best quarter ever for signature of unit growth.

Steve Chapman: Double clicking on oncology volumes on the next slide we typically see at our oncology units grow between seven and 10000 units quarter over quarter. In Q1 oncology grew 17000 units overall with most of these units coming from the core signature clinical business, we are seeing significant gains in <unk>.

Steve Chapman: We typically see our oncology units grow between 7,000 and 10,000 units, quarter over quarter. In Q1, oncology grew 17,000 units overall, with most of these units coming from the core signature clinical business. We are seeing significant gains in new physicians and new patient starts in addition to recurrence monitoring. We think customers came out of ASCO GI excited about the Galaxy data and CRC, and that helped the quarter along with the quality, the size, and the breadth of our clinical trial data, which is resonating with physicians.

Steve Chapman: New physicians and new patient starts in addition, recurrence monitoring.

Steve Chapman: I think customers came out of Astro Gi excited about the galaxy data in CRC and that helped the quarter along with the quality the size and the breadth of our clinical trial data, which is resonating with physicians.

Steve Chapman: We're off to another strong start in Q2, but with that said, we will, of course, see fluctuations in sequential growth as we've seen in the past. The next slide shows the significant step up in revenues we've seen over time, similar to the volume story. We had 18% sequential revenue growth in Q4 of last year and 52% compared to Q1 of last year. This represents some of the fastest revenue growth metrics we've generated despite the fact that the revenue base has more than doubled in the last three years.

Steve Chapman: We're off to another strong start in Q2, but with that said we are of course, the fluctuations in sequential growth as we've seen in the past.

Steve Chapman: The next slide shows the significant step up in revenues, we've seen over time similar to the volume story.

Steve Chapman: We had an 18% sequential revenue growth over Q4 of last year and 52% compared to Q1 of last year. This represents some of the fastest revenue growth metrics. We generated despite the fact that the revenue base has more than doubled in the last three years.

Steve Chapman: In addition to the volume growth, we continue to see ASP significantly outperforming across all of our major products. Women's Health and Organ Health ASPs were up, and Signataria ASPs were above $1,000 in Q1. We continue to make progress on Signataria reimbursement, and we think we have a line of sight to continue ASP expansion through the rest of the year. In addition, the rapid improvement in ASP has driven about $34 million in revenue true-ups this quarter.

Steve Chapman: In addition to the volume growth, we continue to see asps significantly outperforming across all of our major products.

Steve Chapman: Women's health in Oregon held Asps were up and Cigna, Tara Asps were above $1000 in Q1.

Steve Chapman: We continue to make progress on signature of reimbursement and we think we have a line of sight to continued ASP expansion through the rest of the year. In addition, the rapid improvement in Asps has driven about $34 million in revenue true ups. This quarter I think thats, a very healthy sign for the business as it indicates the cash collections are exceeding our prior <unk>.

Steve Chapman: I think that's a very healthy sign for the business, as it indicates that cash collections are exceeding expectations. Our growth trends remain strong, even when stripping out the true ups, and those don't happen every day. On the next slide, you can really see the impact of our improving ASP and COGS on gross margin over the last year. Obviously, 57% is a huge number, but even if you strip out the revenue true-ups, we estimate the underlying repeatable gross margin would have been roughly 53%, which is well ahead of our expectations and drives the increase in the guide.

Steve Chapman: Estimates are growth trends remained strong even when stripping out the true ups and those don't happen every quarter.

Steve Chapman: The next slide you can really see the impact of our improving asps and Cogs and gross margin over the last year, obviously, 57% is a huge number but even if you strip out the revenue true ups, we estimate the underlying repeatable gross margin would have been roughly 53%, which is well ahead of our expectations and drives the increase in the <unk>.

Steve Chapman: Guy.

Steve Chapman: We put a ton of resources and management focus on improving ASPs, but I'm equally excited about the COGS execution we generated recently. We've had several internal projects launch, including moving to higher-throughput sequencers in both Austin and San Carlos for our prenatal business. In addition, we are still expanding our exome capabilities, which will likely drive some short-term increased costs for signataria cogs, but we are already below our goal of $450 based on these scaling benefits, and we expect to stay there for the rest of the year.

Steve Chapman: We put a ton of resources and management focus on improving asps.

Steve Chapman: But I'm equally excited about the Cogs execution, we generated recently.

Steve Chapman: We've had several internal projects launch, including moving to higher throughput secret service in both Austin and San Carlos for our prenatal business. In addition, we are still expanding our exome capabilities, which will likely drive some short term increased costs and signature Cogs, but we are already below our goal of $450 based on the scaling that.

Steve Chapman: We expect to stay there for the rest of the year.

Steve Chapman: We are also now getting large rebates from vendors as we hit higher-volume tiers in our contract. We've historically poured a meaningful percentage of our R&D spend into cost reductions, and now those lean costs are really paying dividends. So all these trends sum to the results on the next slide, which shows our cash burn reduction over time. We set a cash flow break-even target on the Q1 earnings call about two years ago, and we're pleased to have met this goal significantly ahead of schedule. We've been very consistent about the strategy to get here.

Steve Chapman: We are also now getting large rebates from vendors as we hit higher volume tiers in our contracts.

Steve Chapman: We've historically toward a meaningful percentage of our R&D spending to Cogs reductions and now theres lean costs are really paying dividends.

Steve Chapman: So all of these trends some to the results on the next slide which shows our cash burn reduction over time.

Steve Chapman: We set a cash flow breakeven target on the Q1 earnings call about two years ago and we're pleased to have met this goal significantly ahead of schedule. We've been very consistent about the strategy to get here, we've ramped volumes or revenues increased asps are lowered cards, leading to increased gross margins and we've done that while maintaining ambitious levels.

Steve Chapman: We've ramped volumes of revenues, increased ASPs, and lowered COGs, leading to increased gross margins. And we've done that while maintaining ambitious levels of investment in R&D and commercial activities. We think this formula will allow us to continue delivering excellent financial results while maintaining our leadership position in clinical data generation, new product launches, and patient experience. In addition, we've achieved this cash flow breakeven goal without the help of any upcoming potential catalysts such as 22Q guidelines or NCCN guidelines.

Steve Chapman: Of investment in R&D and commercial activities. We think this formula will allow us to continue delivering excellent financial results, while maintaining our leadership position in clinical data generation, new product launches and patient experience. In addition, we've achieved this cash flow breakeven goal without the help of any upcoming potential.

Steve Chapman: <unk> catalysts, such as 20, <unk> guidelines or CCN galleries, those would still represent further upside along with continuing to execute our core strategy and very large underpenetrated markets.

Steve Chapman: Those would still represent further upside along with continuing to execute the core strategy in very large underpenetrated markets. Going through the rest of the year, we may bounce around between positive and negative cash flow quarters, depending on the working capital variables, like the timing of insurance payments, timing of CapEx for the lab, and other factors. But fundamentally, we think we're in a position to continue to serve more patients and grow the business and drive innovation without continually burning cash. And with that said, I'll turn it over to Solomon. Solomon?

Solomon: Going through the rest of the year, we made bounce around between positive and negative cash flow quarters, depending on the working capital variables like the timing of insurance payments timing of Capex and lab and other factors, but fundamentally we think we're in a position to continue to serve more patients and grow the business and drive innovation without continually burning cash.

Solomon: With that said.

Solomon: Let me turn it over to Solomon Solomon.

Solomon: Thanks, Steve.

Solomon Moshkevich: On to some of the highlights from our clinical and product roadmap. In April, we were pleased to mark that we had exceeded over 200 peer-reviewed papers as a company. This chart highlights that we have pursued this strategy throughout the history of the company, across all key areas of focus.

Solomon: Onto some of the highlights from our clinical and product roadmap in April we were pleased to mark that we've surpassed over 200 peer reviewed papers as a company.

Solomon Moshkevich: This chart highlights that we've pursued the strategy throughout the history of the company across all key areas of focus with more than 85 papers in women's health more than 75% in oncology and MRV and more than 40 in Oregon House we've.

Unknown Speaker: Unknown Speaker, Unknown Attendee, Unknown Attendee, Unknown Attendee, Unknown Attendee. We've also been published in some of the most highly respected journals in the world, including Science, Nature, and Nature Medicine. These papers include major breakthroughs in patient care, such as the SMART trial with Panorama, the GALAXY study with Signatera, and the PROACTIVE trial with Prospera, the latter of which was the paper that brought us to the 200 mark. We look forward to growing this even further as we continue generating meaningful evidence to support our roadmap and our mission.

Unknown Speaker: We've also been published in some of the most highly respected journals in the world, including science nature in nature Medicine.

Unknown Speaker: Papers include major breakthroughs in patient care, such as the smart trial with Panorama, The Galaxy study with Cigna Terra and the proactive trial with prospera.

Unknown Speaker: Router, which was the paper that brought us to the 200, Mark we look forward to growing this even further as we continue generating meaningful evidence to support our roadmap and our mission.

Solomon Moshkevich: In women's health, you know, as Steve mentioned, the launch of our new fetal RHD test was a major advancement in prenatal care and one that really differentiates Natera. The test can be performed alongside panorama as early as 9 weeks gestation and is designed to determine the fetal RH status from a maternal blood draw. The launch is particularly timely right now as OBGYNs are currently facing limited supplies of medication that are traditionally given to RHD negative women to prevent potential complications during pregnancy.

Unknown Speaker: In women's health.

Unknown Speaker: Steve mentioned the launch of our new fetal RH D test was a major advancement in prenatal care and one that really differentiates and a tariff.

Solomon Moshkevich: Tests can be performed alongside Panorama as early as nine weeks gestation and is designed to determine the <unk> status from our maternal blood draw.

Solomon Moshkevich: The launches, particularly timely right now as Obgyns are currently facing limited supplies of medication that are traditionally given to our HD negative women to prevent potential complications during pregnancy.

Solomon Moshkevich: The FDA warned about the shortage earlier this year, and following suit, ACOG came out with a statement just in April that supports the use of NIPT for fetal RHD testing, essentially to help conserve medication supply. We are proud to offer this test at a time of critical need in the prenatal community. Beyond the shortage, we view this launch as a key differentiator for Natera on several fronts. First, the vast majority of other NIPT labs do not offer fetal RHD assessment, with only one other test on the market in the U.S. Additionally, Natera's test is backed by a large validation study that included fetal RHD status confirmed via newborn serology, which is the gold standard, in more than 650 This is roughly 10 times more patients with confirmed outcomes than validation studies from other labs. The performance was also outstanding, resulting in 100% sensitivity and 99.3% specificity.

Solomon Moshkevich: <unk> warned about the shortage earlier this year and following suit a card came out with a statement just in April that supports the use of ni PT for fetal RH do testing.

Solomon Moshkevich: Essentially to help conserve medication supply.

Solomon Moshkevich: We are proud to offer this test at a time of critical need in the prenatal community.

Solomon Moshkevich: Beyond the shortage, we view this launch as a key differentiator for Natera on several fronts first the vast majority of other <unk> do not offer fuel our HD assessment with only one other tests in the market in the U S.

Solomon Moshkevich: Second the terrorist test is backed by a large validation study that included futile RH disease status confirmed via newborn serology, which is the gold standard and more than 650 <unk> negative fragrances. This is roughly 10 times more patients with confirmed outcomes and validation studies from other labs and performance was also.

Solomon Moshkevich: Outstanding, resulting in 100% sensitivity and 99, 3% specificity.

Solomon Moshkevich: We believe these differentiators, coupled with the highly validated SNP-based technology that's already built into Panorama, will allow us to expand our reach into new physician practices. Moving to organ health, we have some key announcements during the quarter for both Renasight and Parsparra.

Solomon Moshkevich: We believe these differentiators coupled with a highly validated slippage technology, that's already built into Panorama will allow us to expand our reach into new physician practices.

Solomon Moshkevich: Moving to Oregon Health, we have some key announcements during the quarter for both redesign and prospera.

Solomon Moshkevich: Starting with Renocyte, our genetic test for chronic kidney disease, we're pleased to see a recent guideline update from a leading medical society in nephrology. KDGO, which stands for Kidney Disease Improving Global Outcomes, updated their clinical practice guideline for the evaluation and management of chronic kidney disease. This is significant as the guideline had not been updated in more than 10 years.

Solomon Moshkevich: With Rina site.

Solomon Moshkevich: Eric tests for chronic kidney disease, we were pleased to see a recent guideline update from a leading medical society of nephrology.

Solomon Moshkevich: <unk>, which stands for kidney disease, improving global outcomes <unk> updated their clinical practice guidelines for the evaluation and management of chronic kidney disease. This is significant as the guideline had not been updated and more than 10 years guideline now includes a specific section about the use of genetic testing in CTD and offers a.

Solomon Moshkevich: The guideline now includes a specific section about the use of genetic testing in CKD and offers a broad range of support, including, number one, stating that genetic tests should be used, among other factors, to establish the cause of CKD. Number two, noting that genetic testing can impact the clinical management of CKD patients, just as we saw in the Rieninger study.

Solomon Moshkevich: Broad range of support including number one state in the genetic tests should be used among other factors to establish the cause of CTD.

Solomon Moshkevich: Number two noting that genetic testing can impact the clinical management of <unk> patients just as we saw in the <unk> study.

Solomon Moshkevich: Recommending a list of clinical indications where genetic testing is particularly informative, and that's a list that represents the vast majority of CKD patients. The updated guideline makes it clear that genetic tests like renocyte are an essential tool for nephrologists in the management of CKD patients. We believe this is a key milestone for the field of renal genetics, and we expect this guideline to have a positive impact on clinical adoption of renocyte testing.

Solomon Moshkevich: And number three recommended list of clinical indications, where genetic testing is particularly informative and that's a list which represents the vast majority of <unk> patients.

Solomon Moshkevich: The updated guideline makes it clear that genetic tests like <unk> are an essential tool for Nephrologists and the management of <unk> patients. We believe this was a key milestone for the field of renal genetics and we expect this guidelines that have a positive impact on clinical adoption of <unk> testing.

Solomon Moshkevich: In April, we also published the first major readout from the PROACTIVE trial, which was the largest prospective donor-derived CF DNA study in kidney transplantation. This data came from the first 1,600 patients, approximately. The data demonstrated, for the first time, that PROSPERA is a leading indicator of rejection as donor cell-free DNA levels were significantly elevated up to five months prior to antibody-mediated rejection and up to two months prior to T-cell-mediated rejection. These results show the value of using PROSPERA as an ongoing surveillance tool to detect rejections earlier, not just in scenarios that are for cause. Further, the proactive data once again highlights the outstanding performance of Prospera with an area under the curve of 0.88 and a negative predictive value of 98%, in line with performance as published in the previous study.

Solomon Moshkevich: In April we also published the first major read out from the proactive trial.

Solomon Moshkevich: Which was the largest prospective donor derived CF DNA study in kidney transplantation.

Solomon Moshkevich: With data from the first <unk> hundred patients approximately.

Solomon Moshkevich: The data demonstrated for the first time that <unk> is a leading indicator of rejection as donor cell free DNA levels were significantly elevated up to five months prior to antibody mediated rejection and up to two months prior to T cell mediated rejection. These results show the value of using prospera is an ongoing.

Solomon Moshkevich: Surveillance tool to detect rejections earlier, not just in scenarios that are for cause.

Solomon Moshkevich: Further the proactive data once again highlights the outstanding performance of Prospera with an area under the curve.

Solomon Moshkevich: 0.8, and a negative predictive value of 98% in line with performance as published in the previous studies.

Solomon Moshkevich: In a pretty short time, Prospera has established itself as the premier choice in transplant monocytogenesis. And based on this strong clinical evidence, we see growing momentum behind PROSPERA among transplant physicians in the market. Finally, in oncology, on top of the record volume growth that we generated during the quarter, as Steve outlined, we had a steady drumbeat of trial announcements and publications that continue to demonstrate the clinical value of Signatera across tumor types. I'm going to hand it over to Alex to provide color on our progress in colorectal, bladder, breast, and uterine cancer. I will start with an update on the Altair trial, where things are on track.

Solomon Moshkevich: In a pretty short time to spirit has established itself as the premier choice in transplant monitoring and based on this strong clinical evidence, we see growing momentum behind <unk> among transplant physicians in the market.

Solomon Moshkevich: Finally in oncology on top of the record volume growth that we generated during the quarter as Steve outlined we had a steady drumbeat of trial announcements and publications that continue to demonstrate the clinical value of Cigna Sara across tumor types.

Solomon Moshkevich: Hand, it over to Alex to provide color on our progress in colorectal bladder breast and uterine cancers, starting with an update on the Alterra trial, where things are on track.

Solomon Moshkevich: <unk>.

Alexey Aleshin: Thank you, Solomon. I'll start with colorectal cancer, and in particular the ALTERE study, where we have an exciting few months in store. As a reminder, ALTERE is a treatment for molecular recurrence randomized placebo-controlled phase 3 study in colorectal cancer that is part of the ongoing Circulate Japan study. We've been working closely with our partners in Japan and are looking forward to approaching the key milestones you see outlined on the slide here.

Alex: Thank you Selman I'll start with colorectal cancer in particular, the Altair study, where we have an exciting few months in store.

Alexey Aleshin: As a reminder, alterra is a treatment on molecular recurrence randomized placebo controlled phase III study in colorectal cancer that is part of the ongoing circulate Japan study.

Alexey Aleshin: We've been working closely with our partners in Japan and are looking forward to approaching the key milestones you see outlined on the slide here.

Alexey Aleshin: First and foremost, we recently surpassed the pre-specified target of 190 events for the trial, which is a key step in getting to the next phase of statistical analyses for the readout. After completion of data analyses by our collaborators in Japan, we plan to announce top-line results in August. We expect to present the complete analysis, including primary and secondary endpoints, at a major conference in the fall. And by the end of the year, we plan to submit the study for peer-reviewed publication.

Alexey Aleshin: First and foremost we recently surpassed the pre specified target of 190 events for the trial, which is a key step in getting to the next phase of statistical analyses for the readout.

Alexey Aleshin: After completion of data analyses by our collaborators in Japan, we plan to announce topline results in August we expect to present, the complete analysis, including primary and secondary endpoints at a major conference in the fall.

Alexey Aleshin: And by the end of the year, we plan to submit the study for peer reviewed publication.

Alexey Aleshin: We're very excited to share these results with you, as we believe that this study, if positive, may be one of the most impactful readouts in early stage CRC in quite some time. Also, in colorectal cancer, we recently announced in March our participation in the Circulate France trial, which is another randomized phase three study. We were pleased that Signatare was selected based on its well-validated acid performance characteristics for patient enrollment into this study, which is the only ongoing randomized trial dedicated to studying the benefit of ctDNA testing in low-risk stage 2 colorectal cancer.

Alexey Aleshin: We're very excited to share these results with you.

Alexey Aleshin: As we do believe that this study if positive may be one of the most impactful readouts in early stage CRC in quite some time.

Alexey Aleshin: Also in colorectal cancer, we recently announced in March our participation in the circular France trial, which is another randomized phase III study. We were pleased that Cigna Terra was selected based on the well validated assay performance characteristics for patient enrollment into the study.

Alexey Aleshin: Which is the only ongoing randomized trial dedicated to studying the benefit of Cte DNA testing and low risk stage III colorectal cancer.

Alexey Aleshin: It complements our data generation in both Circulate Japan and North America trials, which are also studying MRD-guided treatment in colorectal cancer, but in a higher-risk population. Circulate France specifically addresses the need for a personalized approach in a population who currently does not receive chemotherapy as the standard of care.

Alexey Aleshin: It complements our data generation and both circulate Japan and North America trials, which are also studying MRV guided treatment in colorectal cancer, but in a higher risk population.

Alexey Aleshin: Circulate, France, specifically addresses the need for a personalized approach and a population who currently does not receive chemotherapy as the standard of care and with over 44000 people in France diagnosed with colorectal cancer. Each year. We believe this trial has the potential to improve outcomes for <unk>.

Alexey Aleshin: And with over 44,000 people in France diagnosed with colorectal cancer each year, we believe this trial has the potential to improve outcomes for many of these patients and pave the way to adoption and reimbursement of Sigma Tera in France and possibly the European Union. We also have compelling data released in bladder cancer from the ongoing INVIGOR-011 trial, which is an international, randomized, phase 3 trial being conducted in collaboration with Genentech. This is the first time that prospective signataria data from an ongoing Phase 3 global study have been presented, a milestone for our evidence generation strategy.

Alexey Aleshin: Many of these patients and pave the way to adoption and reimbursement of Sigma Terra in France, and possibly the European Union.

Alexey Aleshin: We also had compelling data released in bladder cancer from the ongoing and bigger 011 trial, which is an international randomized phase III trial being conducted in collaboration with Genentech.

Alexey Aleshin: This is the first time that prospective Smiths HERA data from an ongoing phase III Global study was presented a milestone for evidence generation strategy.

Alexey Aleshin: The first analysis was presented in March at the European Association of Urology Conferences and included post-surgical outcomes of 171 patients with high-risk bladder cancer who serially tested negative with Signatera. The analysis shows that patients who remain signatory negative without treatment have disease-free survival rates of 92% at 12 months and 88% at 18 months. Furthermore, the overall survival rates were 100% at 12 months and 98% at 18 months.

Alexey Aleshin: The first analysis was presented in March at the European Association of Urology Conference and included post surgical outcomes of 171 patients with high risk bladder cancer with serially tested negative with Sigma Tara.

Alexey Aleshin: The analysis showed that patients who remained signals have been negative without treatment and disease free survival rates of 92% of 12 months and 88% at 18 months.

Alexey Aleshin: Furthermore, the overall survival rates were a 100% at 12 months and 98% at 18 months.

Alexey Aleshin: This was a significant improvement versus the baseline expectations set by prior biobank studies, which further underscores the importance of perspective evidence generation. These results have been generating interest in the medical community and give us increasing confidence that patients who are signatory negative after surgery and remain negative under surveillance might be able to be spared from adjuvant therapy, which is the current standard of care for high-risk patients with muscle and vasobladder cancer. This concept is being formally evaluated in the randomized NCI-sponsored MODERN study, which we discussed in detail during the last earnings call.

Alexey Aleshin: This was a significant improvement versus the baseline expectations set by prior Biobank studies, which further underscores the importance of perspective evidence generation.

Alexey Aleshin: These results have been generating interest in the medical community and give us increasing confidence that patients were <unk> negative after surgery and remain negative under surveillance.

Alexey Aleshin: Be able to be spared from adjuvant therapy.

Alexey Aleshin: Which is the current standard of care for high risk patients with muscle invasive bladder cancer.

Alexey Aleshin: This concept is being formally evaluated in the randomized NCI sponsored monitoring study, which we discussed in detail during the last earnings call.

Alexey Aleshin: While this first analysis covered only MRD-negative patients, the MRD-positive arm of the trial, which is investigating the efficacy of Genentex atezolizumab versus placebo, is expected to read out early next year. That trial result is expected to serve as the basis of our first FDA submission for Signatara for a companion diagnostic label in bladder cancer. We are optimistic about what this data can mean for the role of signatarium in clinical practice, as well as the potential to tailor treatment and improve outcomes for the more than 150,000 muscle-invasive bladder cancer cases diagnosed globally each year. Moving to the next slide.

Alexey Aleshin: While this first analysis covered only <unk> negative patients.

Alexey Aleshin: Marty positive arm of the trial, which is investigating the efficacy of genentech's <unk> drug versus placebo is expected to read out early next year.

Alexey Aleshin: That trial result is expected to serve as the basis of our first FDA submission for Sigma Tara.

Alexey Aleshin: Our companion diagnostic label in bladder cancer.

Alexey Aleshin: We are optimistic on what those data could mean for the role of Sigma terror in clinical practice.

Alexey Aleshin: As well as the potential to tailor treatment and improve outcomes for the more than 150000 muscle invasive bladder cancer cases diagnosed globally each year.

Alexey Aleshin: Moving to the next slide.

Alexey Aleshin: Here you can see meaningful data we've generated in common cancers affecting women. Earlier this year, we had a new publication in Gynecologic Oncology validating the use of Signatera in resected uterine cancer. This is especially timely and important as new diagnoses are rising in the US and mortality rates are also increasing, which is at least partially due to an increase in diagnoses of the more aggressive subtypes of this disease. In this study of real-world signatory utilization, we looked at 267 plasma samples drawn after surgery from 101 women with uterine cancer. As you can see from the Kaplan-Meier curve on the left, the results demonstrate how Sigma Tera is a powerful post-surgical predictor of recurrence. All patients who were signataria negative after surgery remained recurrence-free.

Alexey Aleshin: Here, you can see meaningful data, we've generated and common cancers affecting women.

Alexey Aleshin: Earlier this year, we had a new publication and gynecologic oncology validating the use of Cigna Terra and our respective uterine cancer.

Alexey Aleshin: This is especially timely and important as new diagnoses are rising in the U S and mortality rates are also increasing which is at least partially due to an increase in diagnoses of the more aggressive subtypes of this disease.

Alexey Aleshin: In this study of real World Sigma Terry utilization, we looked at 267 plasma samples drawn after surgery from 101 women with uterine cancer.

Alexey Aleshin: As you can see from the Kaplan Meier curve on the left the results demonstrate how cigna Terra is a powerful post surgical predictor of recurrence.

Alexey Aleshin: All patients who are seeking to turn negative after surgery remained recurrence free also <unk> positive patients had a 15 fold worse recurrence free survival.

Alexey Aleshin: All signataria positive patients had a 15-fold worse recurrence-free survival. Moving to breast cancer, we announced the publication of an expanded cohort from the EBLA study. The original cohort of 49 patients was published in 2019 with up to five years of clinical follow-up. The new expanded cohort had signatory monitoring in 156 patients across all subtypes of breast cancer, with over a thousand plasma time points being analyzed. It also had clinical follow-up of up to 12 years, which we believe is the longest in the field of ctDNA monitoring.

Alexey Aleshin: Moving to breast cancer, we announced the publication of an expanded cohort from the <unk> study. The original cohort of 49 patients was published in 2019 with up to five years of clinical follow up.

Alexey Aleshin: The new extended cohort had signatory monitoring and 156 patients across all subtypes of breast cancer.

Alexey Aleshin: With over a thousand plasma time points being analyzed.

Alexey Aleshin: It also had clinical follow up of up to 12 years, which we believe is the longest in the field of Cte DNA monitoring.

Alexey Aleshin: Samples in the study were collected every six months, starting after the completion of definitive therapy. Patients who were Sigma Tera positive had a 53 times increased risk of death compared to those who tested persistently negative on Sigma Tera. The diagnostic lead times were also longer than before, with signatory detection of recurrence up to three years before imaging being observed, with a median lead time of ten and a half months. All together, these findings bolster the evidence for long-term monitoring of breast cancer patients who often face late recurrence.

Alexey Aleshin: Samples in the study were collected every six months starting after the completion of definitive therapy.

Alexey Aleshin: Patients who were signaled her positive had over a 53 fold increased risk of death compared to those two tests have persistently negative on SYGMA Tara.

Alexey Aleshin: The diagnostic lead times will also longer than before with Cigna <unk> detection of recurrence up to three years before imaging being observed with median lead time of 10 and a half months.

Alexey Aleshin: Altogether. These findings bolster the evidence for long term monitoring of breast cancer patients, who often face late recurrences.

Alexey Aleshin: These publications build on our commitment to be a leader in women's health. This includes our recent MoldeX approval in ovarian cancer, as well as our expansion of breast cancer coverage to the knee ladrum setting. Lastly, we continue to make progress on our early cancer detection program with judicious utilization of resources and a data-first strategy. We are completing a large case-control study, and we plan for the data to be announced in June.

Alexey Aleshin: These publications build on our commitment to be a leader in women's health. This includes our recent <unk> approval in ovarian cancer as well as our expansion of breast cancer coverage to the neo adjuvant setting.

Alexey Aleshin: Lastly, we continue to make progress on our early cancer detection program with judicious utilization of resources and data first strategy.

Alexey Aleshin: We are completing a large case control study and we plan for the data to be announced in June.

Alexey Aleshin: In addition, as we stated before, we're prospectively collecting a large screening cohort of colonoscopy-matched blood samples, and we plan to share the results of that study in Q4. With that update, let me hand the call back to Mike to cover the financials.

Alexey Aleshin: In addition, as we stated before we are prospectively collecting a large screening cohort of colonoscopy matched blood samples and we plan to share the results of that study in Q4.

Alexey Aleshin: With that update let me hand, the call back to Mike to cover the financials Mike.

Mike Brophy: Great, thanks Alex. The next slide is just a summary of the P&L and Q1 and the year over year progress we've made. Steve covered the key points on revenues and margins, so I won't repeat them here. On the expense lines, we've made several growth-oriented investments in SG&A over the past year. For example, picking up the women's health sales team from Invitae and doubling down on our staffing and technology investments and revenue cycle that we've described previously. We also had some elevated litigation expenses in the quarter, given all the activity we had on the IP front in Q1.

Mike Brophy: Great. Thanks, Alex the next slide is just a summary of the P&L in Q1 and the year over year progress we've made.

Mike Brophy: We've covered the key points on revenues and margins, so I won't repeat them here.

Mike Brophy: On the expense lines, we've made several growth oriented investments in SG&A over the past year for example, picking up the women's health sales team from <unk> and doubling down on our staffing and technology investments in revenue cycle that we've described previously we also had some elevated litigation expenses in the quarter given all the <unk>.

Mike Brophy: We had on the IP front in Q1.

Mike Brophy: We stepped up R&D modestly, in part with the goal of accelerating several product launches in the near future, the first of which is the time-sensitive RH launch Steven Solomon described earlier. I think each of these investments is delivering strong ROACs, as evidenced by the significant bottom-line improvement year-on-year in EBITDA, EPS, and, of course, cash burn, where we burned $86 million in Q1 last year and I was particularly pleased to see a break-even on cash flow this quarter, given the disruption to the entire healthcare payment system caused by the Change Healthcare cyber attack.

Mike Brophy: We stepped up R&D modestly in part with the goal of accelerating several product launches in the near future, but first of all which was the time sensitive RH launch Stephen Simon described earlier I think each of these investments are delivering strong ROIC CES as evidenced by the significant bottom line improvement year on year in EBITDA.

Mike Brophy: Our EPS and of course cash burn, where we bring the $86 million in Q1 last year and broke even in Q1 this year.

Mike Brophy: I was particularly pleased to see us breakeven on cash flow this quarter, given the disruption to the entire health care payments system caused by the change healthcare cyber attack. So it was not a direct vendor to us but the attack Nonetheless caused several weeks of confusion and delayed claims submissions.

Mike Brophy: Change is not a direct vendor to us, but the attack nonetheless caused several weeks of confusion and delayed claim submissions, as Change is a very large claims and payments clearinghouse. So I still think the impact is ultimately immaterial to our results.

Mike Brophy: He is a very large claims and payments clearinghouse.

Mike Brophy: I still think the impact is all ultimately immaterial to our results. We are still dealing with backlog responses from payers and I think the cleanup will last well into Q3 at least.

Mike Brophy: We are still dealing with backlog responses from payers, and I think the cleanup will last well into Q3 at least. The good news is that our team was able to move quickly, find some alternative pathways to get claims submitted and responded to, and our overall positive momentum on volumes and ASPs allowed us to deliver above plan. Okay.

Mike Brophy: The good news is that our team was able to move quickly find some alternative pathways to get claims submitted and responded and our overall positive momentum on volumes and Asps allowed us to deliver above plan.

Mike Brophy: Let's get to the revised financial guidance on the next slide. On revenues, we are now expecting $1,420,000,000 to $1,450,000,000 for the full year 2024. This represents a bump of about $100,000,000 at the midpoint as compared to the roughly $20,000,000 beat in the quarter when removing the revenue true-ups Steve talked about. The annual revenue guide now implies about 33% revenue growth versus 2024. We experienced a huge organic step-up in women's health, as you saw in the earlier slides, which was further amplified by the NZK addition in Q1.

Speaker Change: Okay, great, let's get through the revised financial guidance on the next slide on revenues, we are now expecting $1.420 billion to $1 billion and $450 million for the full year 2024. This represents of a bump of about $100 million at the midpoint as compared to the roughly $20 million in the quarter.

Mike Brophy: When removing the revenue true up Steve talked about the annual revenue guide now implies about 33% revenue growth versus 2023.

Mike Brophy: We experienced a huge organic step up in women's health as you saw in the earlier slides, which was further amplified by the equal addition in Q1 as a reminder, there is a pronounced seasonality in our women's health volumes. So we wouldn't be surprised to see some modest pullback in situ volumes as we've seen in previous years.

Mike Brophy: As a reminder, there's pronounced seasonality in our women's health volumes, so we wouldn't be surprised to see some modest pullback in Q2 volumes, as we've seen in previous years, then see sequential growth in the women's health business again in Q3 and Q4. We are off to a strong start again in oncology volumes in Q2, though I wouldn't expect the same kind of step-up we saw in Q1. We've got great momentum going in Signatara and expect continued sequential growth in Q2 and beyond this year. The guide implies ASPs remaining stable at these levels across women's health and oncology for the rest of the year.

Mike Brophy: Keith sequential growth in the women's health business again in Q3 and Q4, we are off to a strong start again in oncology volumes in Q2.

Mike Brophy: Wouldn't expect the same kind of step up we saw in Q1, we've got great momentum going into the Kara unexpected continued sequential growth in Q2 and beyond this year.

Mike Brophy: The guide implies Asp's remaining stable at these levels across women's health in oncology for the rest of the year, we think that's appropriate.

Mike Brophy: We think that's appropriate because there can always be quarter-to-quarter fluctuations in ASPs, but if we can continue to drive them higher, as Steve described, that would be a source of upside to the guide. So the revenue guide implies that we will build on the strong volume base we established in Q1 and continue to benefit from the ASPs we are seeing now at this level. As Steve mentioned in his section, we are already ahead of schedule for our COGS forecast, and so the guide implies stable COGS for the remainder of the year. We've got a number of product and lab workflow launches planned for this year, which usually generates some temporary transition costs.

Mike Brophy: Always be quarter to quarter fluctuations in ASD.

Mike Brophy: If we can continue to drive them higher as Steve described that would be a source of upside to the guidance. So.

Mike Brophy: So the revenue guide implies that we will build on the strong volume base. We've established in Q1 and continued to benefit from the Asps. We are seeing now at this level.

Mike Brophy: As Steve mentioned in his section we are already ahead of schedule for our Cogs forecast and so the guide implies stable Cogs for the remainder of the year. We've got a number of products in lab workflow launches planned for this year, which you usually generate some temporary transition costs, but I think those can be balanced out by the efficiencies we've already achieved in Q1.

Mike Brophy: But I think those can be balanced out by the efficiencies we've already achieved in Q1. So those are the assumptions driving the increase in our gross margin expectations for the year. The Operating Expense Guide implies that quarterly expenses will remain relatively flat compared to Q1 for the rest of the year. This should allow for room to make incremental growth investments in sales and operations and R&D as a chunk of the Q1 SC&A spend went to all the IP-related litigation activities and a one-time non-cash true-up related to a stock-based compensation. While we will continue to defend our IP, I don't expect that level of legal activity to repeat itself every quarter.

Mike Brophy: Good.

Mike Brophy: So those are the assumptions driving the increase in our gross margin expectations for the year.

Mike Brophy: The operating expense guide implies the quarterly expenses will remain relatively flat compared to Q1 for the rest of the year. This should allow for room to make incremental growth investments in sales and operations and R&D as it sort of the Q1 SG&A spend went to all of the IP related litigation activities and a one.

Mike Brophy: One time non cash true ups related to stock based comp while we will continue to defend our IP I don't expect that level of legal activity to repeat every quarter.

Mike Brophy: As Steve described, we are in a position to keep making investments to stay in the lead and still grow revenues much faster than a. You can see the result of that formula on the cash burn guide, which now has us cash neutral at the midpoint of the range. Now that we are operating at this break-even level, it's important to understand that we will expect to have fluctuations in quarterly cash burn due to the timing of capital expenditures and working capital, as Steve described.

Mike Brophy: As Steve described we are in position to keep making investments to stay in the lead and still grow revenues much faster than expenses you can see the result of that formula on the cash burn guidance, which now has us cash neutral at the midpoint of the range.

Mike Brophy: Now that we are operating at this breakeven level, it's important to understand that we will expect to have fluctuations in quarterly cash burn due to timing of capital expenditures and working capital as Steve described the timing of reimbursement from payers can easily vary in any given quarter and the changed healthcare is a good example of how that could happen.

Mike Brophy: The timing of reimbursement from payers can easily vary in a given quarter, and the changed healthcare breach is a good example of how that can happen. So I fully expect to have a quarter where we have negative cash flow and others where we are positive, and the guide just represents the full year. The income statement, of course, is less prone to these swings.

Mike Brophy: So I fully expect to have a quarter, where we have negative cash flow and others, where we are positive in the guides us represents the full year results. The income statement of course is less prone to these swings and so I expect our losses to gradually narrow through the course of the year.

Mike Brophy: And so I expect our losses to gradually narrow through the course of the year. Okay, the next slide we'll do quickly. I was looking back at the Q1 2022 earnings call deck while preparing for our call today, and I thought this long-range model from that presentation was an interesting slide. This is the exact slide we used when setting the goal of getting to a cash flow break even quarter in 24.

Mike Brophy: Okay. The next slide will be quickly I was looking back at the Q1 2022 earnings calls that while preparing for our call today.

Mike Brophy: This long range model from that presentation was an interesting slide. This is the exact slide we used when setting the goal of getting to a cash flow breakeven quarter in 'twenty four.

Mike Brophy: And you can see that our results this quarter mirror very closely what we had forecasted back then. Specifically, we thought we could get to roughly $1.4 billion in annual revenues at mid-fifties gross margins on stable operating expenses in 2024, which is essentially what we're showing today. I think most investors discounted this target at the time as being overly aggressive.

Mike Brophy: And you can see that our results this quarter mirror very closely what we had forecasted that that specifically, we thought we could get to roughly $1 $4 billion in annual revenues at mid <unk> gross margins on stable operating expenses in 2024, which is essentially what we're what we're showing today.

Mike Brophy: But we have a lot of conviction in this model because, starting with Steve, our executive team spent a lot of time and effort forecasting the, One final slide on the next slide just to summarize a few of the potential key catalysts to watch for for the remainder of the year. Of course, we will remain focused on driving quarterly results and hope to have more earnings calls like this. As of today, we've been able to deliver strong results without the tailwind of updated women's health guidelines for carrier screening or microdeletion.

Mike Brophy: I think most investors discounted this target at the time of being overly aggressive, but we have a lot of conviction in this model because starting with Steve Our executive team spent a lot of time and effort forecasting the business.

Mike Brophy: One final slide on the next slide just to summarize a few of the potential key catalysts to watch for for the remainder of the year of course, we will remain focused on driving quarterly results and hope to have more earnings calls like this one.

Mike Brophy: As of today, we've been able to deliver strong results without the tailwind update.

Mike Brophy: Updated women's health guidelines and carrier screening or micro deletions as usual. We don't include any guideline expectations in our guidance given the timing of these updates are completely out of our hands and hard to predict still we continue to expect updated guidelines on both microdose and broadening our carrier screening and wouldn't be.

Mike Brophy: As usual, we don't include any guideline expectations in our guidance because the timing of these updates is completely out of our hands and hard to predict. Still, we continue to expect updated guidelines in both microdials and broad panel carrier screening and wouldn't be surprised to see one or both of them arrive in the near term. The Altair study continues to progress on schedule, and while the timeline is ultimately in the hands of the investigators, we continue to expect top-line results to be released in August, subject to variances caused by investigator data analysis and the embargo requirements of various academic conferences where the data may be presented.

Mike Brophy: Our eyes to see one or both of them arrived in the near term.

Mike Brophy: The Altair study continues to progress on schedule and while the timeline is ultimately in the hands of the investigators. We continue to expect top line results to be released on August subject to variance was paused by investigator data analysis on the embargo requirements of various academic conferences, where the data may be presented.

Mike Brophy: We've got a number of additional cancer types in the pipeline for Mobex coverage, and we hope to be able to announce several additional coverage decisions this year. We also have submitted an LCD for RenaSci and hope to report on further progress on that later today. We spent a good amount of time on biomarker states during our Q4 call, so we didn't want to rehash that content again today. But we are pleased with the early traction we are seeing.

Mike Brophy: We've got a number of additional cancer types in the pipeline for mobile coverage and we hope to be able to announce several additional coverage decisions. This year.

Mike Brophy: We also have submitted an LCD arena and hope to report on further progress on that later this year.

Mike Brophy: We spent a good amount of time on biomarker states during our Q4 call. So we didn't want to rehash that content again today, but we are pleased with the early traction. We're seeing we continue to think that while the positive impact is most likely to be seen in 2025 progress through the course of this year on biomarker related reimbursement.

Mike Brophy: We continue to think that while the positive impact is most likely to be seen in 2025, progress through the course of this year on biomarker-related reimbursement would further enhance our. Finally, we are pleased to be able to announce our first major product launch of the year, RHD testing, and we've got several more slates to launch later this year and look forward to announcing those as they go live. Okay, with that, let's open it up for questions. Operator?

Mike Brophy: Would further enhance our results. Finally, we are pleased to be able to announce our first major product launch of the year with R&D testing and we've got several more slated to launch later this year and look forward to announcing those as they go live.

Speaker Change: Okay with that let's open it up for questions operator.

Greg: Thank you. And at this time, I would like to remind everyone that in order to ask a question, press star then the number one on your telephone keypad. And we'll pause just a moment to compile the Q&A roster. It looks like our first question comes from the line of Dan Brennan with TD Cowen. Dan, please go ahead.

Speaker Change: Thank you and at this time I would like to remind everyone in order to ask a question Press Star then the number one on your telephone keypad and we'll pause just a moment to compile the Q&A roster.

Greg: It looks like our first question comes from the line of Dan Brennan with TD Cowen Dan. Please go ahead.

Daniel Gregory Brennan: Great, thank you. Thanks for the question. Great quarter, guys.

Daniel Gregory Brennan: Great. Thank you. Thanks for the question great quarter guys.

Daniel Gregory Brennan: Maybe just the first one on Signatara, the kind of volume and price. Steve, I think you talked about the Galaxy Impact. We'd love to hear you elaborate a little bit on that in terms of new doctors, existing doctors, and kind of what you're seeing in Q2 from that. And then on the pricing side, Mike, I think you heard me say maybe flat pricing from here on Signatara. So, Quent, you're just wondering why it couldn't keep ticking up throughout the year.

Daniel Gregory Brennan: Maybe just the first one on seeing the terra kind of volume and price.

Daniel Gregory Brennan: Steve I think you've talked about the galaxy impact would love to hear you elaborate a little bit on that in terms of new docs existing docs and kind of what youre seeing in Q2 from that and then on the pricing side, Mike I think you heard I think I heard maybe flat pricing from here on Signet Terror sequentially, just wondering why it couldnt keep ticking up throughout the year.

Steve Chapman: Yeah, that's a great question. So, you know, when you look at growing, I mean, really, any clinical diagnostic, you want to add new physicians, new accounts, and then within the accounts, you want to grow the business to increase utilization with existing positions. And so that's exactly what we're seeing, once doctors start using Signatera, they tend to increase their utilization and continue using it.

Speaker Change: Yes, that's a great question. So when you look at growing I mean really with.

Steve Chapman: Any clinical diagnostic you want to add new physicians, new accounts and then within the accounts you want to grow the business too.

Steve Chapman: Two to increase utilization.

Steve Chapman: The existing positions and so that's exactly what we're seeing is once doctors start using signet terror they tend to increase their utilization and continue using it and then once one doctor starts within a practice it tends to sort of spread within the practice so.

Steve Chapman: And then once one doctor starts within a practice, it tends to sort of spread within the practice. So, you know, obviously, at ASCO GI, we had some great additional data coming out of the Galaxy study. You know, we think that was received very well. And we're seeing that, you know, lead to increased growth. Mike, do you want to talk about ASPs?

Steve Chapman: Asking the GI we had some great additional data coming out in the Galaxy study, yes, we think that was received very well and we're seeing that lead to increased growth.

Steve Chapman: Mike you want to talk about Asps.

Mike Brophy: Yes, no. Thanks for the question I think yes, so signatory asps are going to above $1000 in the quarter.

Mike Brophy: As I look at kind of the more recent fundamentals on signatory ASPs, I mean, I think there is scope for the ASPs to continue to increase through the course of the year. Specifically, I'm just looking at payment rates and trends from Medicare Advantage payers as they continue to come online.

Mike Brophy: Looking at kind of the more recent fundamentals on Asps I mean, I think there is scope for the for the Asps to continue to increase through the course of the year, specifically I'm just looking at.

Mike Brophy: Payment rates and trends from Medicare advantage payers as they continue to come online and some of the early green shoots from the biomarker states that we're talking about in the prepared remarks, and really meeting these accruals quarter quarter really come down to something like a judgment call on how much history do you want to see before you step up.

Mike Brophy: And some of the early green shoots from the biomarker states that we're talking about in the prepared remarks. And really, these accruals, quarter to quarter, really come down to kind of like a judgment call, like how much history do you want to see before you step up the, you know, accrued ASP again. And, you know, it may turn out that we were a bit cautious on this acquisition, but I just want to see some more history there.

Mike Brophy: The crude asking again and we may it may turn out that we turned out we.

Mike Brophy: We were a bit cautious on this accrual, but I just wanted to see some more history there.

Mike Brophy: So, I feel pretty good about our ability to grow ASPs for the remainder of the year. Now, that maybe begs the question, you know, on the guide, why hold ASPs steady at these levels? And it just, it really goes back to that kind of caution. You know, you want to see enough history with new payers coming online to see that, you know, stable trend within a given payer before starting to accumulate. But, you know, fundamentally, the underlying fundamentals look great for secondary ASPs, I think.

Mike Brophy: Pretty good about our ability to grow asp's for the remainder of the Easter, but that may be begs a question on the guide why hold asp's steady at these levels.

Mike Brophy: And it really goes back to that kind of caution just want to see enough history with new payors coming online to see that stable trend given.

Mike Brophy: Given the payer before starting to accrue but.

Mike Brophy: Fundamentally the underlying fundamentals look great for the sector is because I think.

Daniel Gregory Brennan: Great, thanks for that. And then maybe just want to follow up on gross margins, really strong, even extra true ups still beat us by over 300 basis points. So I think you discussed CODS reductions, ASP, and then also, you know, cash collections beyond the true ups. So just, did I hear you guys right?

Speaker Change: Great. Thanks for that and then maybe just one follow up on gross margins really strong even ex the true up still beat us by over 300 basis points. So I think you've discussed Cogs reductions ASP and then also.

Daniel Gregory Brennan: Cash collections beyond the true ups. So just did I hear you guys right Youre thinking gross margins flat from here I'm just wondering some of the benefits you had in the quarter like I would assume there's possibly further tailwind from from those so maybe just speak a little bit.

Daniel Gregory Brennan: You're thinking gross margins flat from here. I'm just wondering some of the benefits you had in the quarter, like I would assume there's, you know, possibly, you know, further tailwind from those. So maybe just speak a little bit about what really drove gross margins and how we think about that going forward. Yeah, I mean, on gross.

Daniel Gregory Brennan: Kind of what really drove the beat on gross margins and how we think about that going forward.

Daniel Gregory Brennan: Yes.

Mike Brophy: Yeah, I mean, on gross margins, I mean, just to clarify, I think the guide now is 53 to 55, and the organic implied about a 50, about like a 53. So the midpoint of guide now implies, you know, sequential improvement through the rest of the year. So it's like your total year, you know, what would end up higher, although 53 is going to be in the guide. The reason for that, again, I mean, there's some caution that's warranted as relates to forecasting gross margins from quarter to quarter, just because the ASPs can fluctuate quarter to quarter, right?

Speaker Change: Yes, I mean on gross margins I mean, just to clarify I mean, I think the guide now has 53 to 55 in the organic implied about S&P.

Mike Brophy: 53, so the midpoint of the guide now implies sequential improvement through the rest of the year. So that your total year.

Mike Brophy: What would end up higher although 53% in the guide the reason for that again I mean, there is some caution.

Mike Brophy: It's warranted as it relates to forecasting gross margins in this business quarter to quarter, just because the asp's can fluctuate quarter to quarter right.

Mike Brophy: We also don't, you know, in the guide; we just presume that there's no true ups kind of in the guide. And of course, if you have true ups in the course of the year, that would tend to be an upside to the guidance. So what that guide is intended to do is to express confidence in our ability to modestly improve gross margins through the rest of the course of the year.

Mike Brophy: We also don't.

Mike Brophy: And the Guy we just presume that there is no true ups kind of in the guide and of course, if you add trucks through the course of the year that would that would tend to be upside to.

Mike Brophy: The guidance so with that guide is intended to do is to us too.

Mike Brophy: Expressed confidence in our ability to modestly improve the gross margins through the rest of the course of the year.

Speaker Change: Great. Thank you.

Speaker Change: Thanks, Dan.

Tejas Rajeev Savant: And our next question comes from the line of Tejas Savant. Tejas, please go ahead.

Mike Brophy: And our next question comes from the line of Hey, Jeff Savant <unk>. Please go ahead.

Mike Brophy: Hey guys, good evening, and congrats on the strong start to the year here. Maybe just a math question for you, Mike, you beat by 50 mil, including about 34 and true ups, but you're raising your guide by 100, right? So as we try to build that bridge in terms of incremental upside, can you just help us pass it out between Signatara, you've got the Rhenaside Cadego update, and any incremental Invitae upside as well versus the 20 to 25 that you had baked in earlier?

Tejas Rajeev Savant: Hey, guys good evening and congrats on the strong start to the year.

Mike Brophy: Maybe just a math question for you Mike you beat by 50 mail, including about 34 and true ups, but you're raising your guidance by 100 right says we.

Mike Brophy: Tried to build that bridge in terms of incremental upside can you just help us parse it out between segments that you've got the renal side could eagle update and any incremental upside as well versus the 20% to 25% that you had baked in earlier.

Mike Brophy: Yeah, yeah. So ASPs across the board, we're holding relatively stable in the guide for the rest of the year. There are some modest improvements in the guide to women's health that we feel quite good about, but overall, fairly stable in the guide for ASPs. So that leaves volumes for you as the major source of upside kind of across the products, which we think makes a certain amount of sense, just given that we've seen this big step up in Q1, and now we feel like we're in position to grow from this base, understanding that there is some seasonality to be seen in some of these businesses, particularly in women's health.

Speaker Change: Yes, yes so.

Mike Brophy: Asps.

Mike Brophy: The board, we're holding relatively stable in the guide for the rest of the year I guess some modest improvements in the guide in women's health that we feel quite good about but overall fairly stable in the guide for for Asps.

Mike Brophy: So that leaves volumes for you.

Mike Brophy: The major source of upside kind of across the products.

Mike Brophy: Which we think makes it makes them starting as soon as just given that we've seen this big step up in Q1.

Mike Brophy: And now we feel like we're in position to.

Mike Brophy: To grow.

Mike Brophy: No trend this space understanding that there is some seasonality can be seen in some of these businesses, particularly in women's health. What we've seen historically is that you have a big Q1, and then you kind of sequentially down a bit in Q2.

Mike Brophy: What we've seen historically is that you have a big Q1, and then you're kind of sequentially down a bit in Q2, and then you grow the remainder of the year, just like we talked about in the prepared remarks. And then, in Signataria and Prospera, frankly, we're just expecting continued sequential quarterly volume growth in each of those businesses, probably not at the level that we saw in Q1, just to be cautious about that.

Mike Brophy: And then you grow the remainder of the year, just like we talked about in the prepared remarks.

Mike Brophy: And then in <unk>.

Mike Brophy: <unk>, we're frankly, we're just expecting.

Mike Brophy: Continued sequential quarterly volume growth in each of those businesses probably not at the level that we saw in Q1 just to be just to be cautious about that I mean that was a massive outperformance I just think its ore volumes.

Mike Brophy: I mean, that was a massive outperformance on Signataria volumes, although we are off to a good start so far in Q2. So that's some kind of flavor on where the raise is coming from. It's primarily volume-based, and it's really – sorry for the boring answer, Tejas, but volume from across the board is really contributing to that.

Mike Brophy: Although we are off to a good start so far in Q2. So that's kind of that's some kind of flavor on where the where the raise is coming from it's primarily volume based.

Mike Brophy: And it's really sorry for the boring answer pages with kind of clients and across the board is really contributing to that.

Tejas Rajeev Savant: Got it. And a two-parter for my follow-up here. So, starting with ReDecide, you know, following Kadego, have you had any sort of discussions with the National Kidney Foundation? Is that something that we could see in the summer here?

Speaker Change: Got it.

Speaker Change: A two parter for my follow up here so.

Speaker Change: <unk> with re to site. Following could you go have you had any sort of discussions for the national kidney Foundation is that something that we could see in the summer here and.

Steve Chapman: And could you share some data on just how the conversations have gone since Kadego went into effect? Are you starting to see that nephrologist penetration go up from the 50 percent who've already used the test? And are you starting to see repeat use come through as well? And then, Steve, one for you on just screening, right? We've had some competitor readouts here, and we've got an FDA approval coming up as well. So, I'm just curious as to whether you still think that, you know, better performance versus those tests that are read out in blood is good enough? Or has the goalpost shifted in your mind a little bit, and you expect sort of step function, better performance, particularly in advanced adenoma, as a threshold for Natera to offer that indication? Thank you. Yeah, there it is.

Steve Chapman: Could you share some.

Steve Chapman: Data on just how the conversations have gone since <unk> went into effect are you starting to see that Nephrologists penetration go up from the 50% to <unk> you said that Stan are you starting to see repeat use come through as well.

Steve Chapman: And then Steve one for you on just screening rates, we've had some competitor readouts here, if you've got an FDA AD com coming up as well. So I'm just curious as to whether you still think that.

Steve Chapman: Better performance versus those stats that I've read out in blood is good enough or or it has the goalposts shifted in your mind, a little bit and you expect sort of a step function better performance, particularly in advanced adenoma as the threshold for <unk> to go after that indication. Thank you.

Steve Chapman: Yeah, that's a great question. So, I'll comment briefly on Cadigo and Renaside and then Solomon. If there's something you want to add,

Speaker Change: Yes, it's a great question. So I'll comment briefly on <unk> solid, but if there's something you want to add so certainly the we've been had a lot of conversations with physicians about the guideline.

Steve Chapman: So, certainly, we've been having a lot of conversations with physicians about the guideline, and it's being very well received. I mean, there's a lot of excitement about the updated guideline, so I think there is a lot of opportunity here to more deeply penetrate this market, which, you know, there are, I think, maybe 40 million Americans or something in that range that are sitting with the diagnosis of chronic kidney disease. So there's a big opportunity here. Really, I think the goal is not necessarily to get more and more physicians ordering the test. It's to increase the utilization within the accounts.

Steve Chapman: And.

Steve Chapman: Those.

Steve Chapman: Very well received I mean, theres a lot of excitement about the updated guideline.

Steve Chapman: I think there is a lot of opportunity here to more deeply penetrate this market, which.

Steve Chapman: I think maybe 40 million Americans are something that range that are.

Steve Chapman: Sitting with a diagnosis of chronic kidney disease. So there's a big opportunity here really I think the goal is not necessarily to go well.

Steve Chapman: Get more and more physicians ordering the test it's to increase the utilization within the accounts and that's what we're working on now.

Steve Chapman: And that's what we're working on now. We do think that the NKF will be coming out with an updated guideline at some point in the future. You know, we hope that it comes this year. We don't know exactly what it's going to say. But, you know, I think they're obviously working closely with Cadego and looking at all the new data coming out. So, you know, that's exciting. And, you know, on ECD, I think, you know, obviously, we've got a readout coming pretty soon. So I'll probably just defer comments there until, you know, I think we said in June when the case control study breathes out.

Steve Chapman: Do you think that the.

Steve Chapman: <unk> will be coming out with an updated guide one at some point in the future.

Steve Chapman: Hope that pumps. This year, we don't know exactly what it's going to say, but.

Steve Chapman: I think they're obviously working closely with could you go and looking at all the new data coming out.

Steve Chapman: So that's exciting.

Steve Chapman: On ACD I think.

Steve Chapman: Obviously, we've got a readout coming pretty soon so I'll, probably just defer.

Steve Chapman: Comments there.

Steve Chapman: So until I think we said in June when the when the case.

Steve Chapman: Case control study reads out.

Solomon Moshkevich: Steve, I think you hit all the key points. I have nothing to add there.

Steve Chapman: I think you hit all the key point is not going to occur.

Speaker Change: Okay. Thanks.

Speaker Change: Thanks, guys.

Steve Chapman: Thanks, Dave.

Puneet Souda: And our next question comes from the line of Puneet Souda with Leering Partners. Puneet, please go ahead.

Solomon Moshkevich: And our next question comes from the line of Puneet <unk> with Leerink partners. Please go ahead.

Puneet Souda: Hey guys, first of all, congrats on a really impressive quarter here. I guess the first question is, the contribution that you saw from Invitae accounts, you know, how is that likely to fall for the rest of the year? I mean, you, it appears that you had a bolus.

Puneet Souda: Hey, guys.

Puneet Souda: So first of all congrats on a really impressive quarter here.

Puneet Souda: I guess the first question is the contribution that you saw from <unk> accounts.

Puneet Souda: How is that likely to fall to rest of the year. I mean, you appears that you had a bolus there.

Puneet Souda: There were some organic account wins in the quarter. Could you talk about deepening those accounts and further account wins that you haven't had so far, maybe falling into 2Q? And also, some of these accounts were maybe patient pay or no pay accounts. So talk to us a little bit about sort of cleanup of those accounts and how sustainable is the ASPD trend going forward.

Puneet Souda: Organic account wins in the quarter could you talk about about deepening of those accounts.

Puneet Souda: And further account wins that you haven't had so far maybe falling into <unk> and also some of these accounts, where maybe patient pay or no pay account so talk to us a little bit about sort of cleanup of those account and how sustainable is the ASP trend going forward.

Steve Chapman: Yeah, that's a good question. So, you know, when BK last announced the numbers, I think, which was maybe in September of 2023, you know, things have changed quite a bit between that timeframe. And when we took over, you know, at the end of January, I think they had really gotten rid of a lot of that cash pay business and that lower margin business. So, you know, when we came in kind of in January, it was generally, it was sort of the higher-margin business, except for some of the international where, you know, we got what we could, but some of the lower-margin business there, you know, we just weren't able to participate in.

Speaker Change: Yes, so good question so.

Puneet Souda: I think in <unk>.

Steve Chapman: Lastly, Dallas the numbers I think which is maybe in September of 2023 things.

Steve Chapman: Things change quite a bit between that timeframe and when we took over.

Steve Chapman: At the end of January and I think they had gotten.

Steve Chapman: Really gotten rid of a lot of that cash pay business in that lower margin business.

Steve Chapman: So when we came in kind of into January.

Steve Chapman: Generally it was it was sort of the higher margin business, except for some of the international where we got what we could.

Steve Chapman: But most of the business kit is on now that we're going to get and I think, you know, a tiny amount in January, a little more ramping up in February. And then, you know, I think March was almost a complete month there. But we did. We did really well. You know, so you'll get the kind of full pacing of that quarter of VTA volume in Q2.

Steve Chapman: Some of the lower margin business there.

Steve Chapman: We weren't able to participate in it but most of the business is on now that we're going to we're going to get and I think.

Steve Chapman: Tiny amount in January.

Steve Chapman: More ramping up in February and then I think March was almost a complete month, there, but we did we did really well.

Steve Chapman: So you'll get the kind of full pacing of that quarter.

Steve Chapman: <unk> volume in Q2, but we did really well based on where we started in January we got the majority of the business converted over and we're feeling good about that but again, there was a pretty significant step down.

Steve Chapman: But we did really well, you know, based on where we started in January; we got the majority of the business converted over, and we're feeling good about that. But, again, there was a pretty significant step down from where we started in January to where they last reported. You know, with that said, also, you asked about organic growth. The majority of the Q1 volume growth in Women's Health, which was incredible, the 85,000 units, I think that was or is one of the fastest growing sequential quarters we've ever had in the history of the company.

Steve Chapman: But from where we started in January to where they last reported.

Steve Chapman: With that said also you're asking about organic growth. The majority of the Q1 volume growth in women's health, which was incredible I mean 85000 units I think that is or is one of the fastest growing sequential quarters. We've ever had in the history of the company I had mentioned before that we were seeing record units.

Steve Chapman: You know, I mentioned before that we were seeing record units per receiving day in December. There's just a lot of momentum with, I think, the differentiators that we have at Niterra. I think the data that we've put out, we're starting to see, I think, significant interest from physicians, and that's driving a lot of the organic growth.

Steve Chapman: We're receiving day in December there's just a lot of momentum with I think the differentiators that we have it and in Tara.

Steve Chapman: I think the data that we've put out we're starting.

Steve Chapman: We're going to see I think significant interest from physicians and that's driving a lot of the organic growth.

Puneet Souda: Got it, super. And then on the oncology side, if I may ask, if Solomon or Alex could cover this, could you just update the latest thoughts on the sort of timing of NCCN and sort of what is required there? And how essential is the success of Altair to that?

Speaker Change: Got it and then on the oncology side, if I may ask.

Puneet Souda: <unk>.

Speaker Change: If solomon or Alex could cover this.

Puneet Souda: Thank you.

Solomon Moshkevich: Could you just update.

Solomon Moshkevich: The latest thoughts on the sort of the timing of NCC in and sort of what is required there.

Speaker Change: And how essential is the success of Alterra to that thank you.

Solomon Moshkevich: Solomon, you want to make a couple of comments and then maybe Alex, you can jump in. Sure. Good question, Puneet. I think.

Speaker Change: So I mean, you want to make a couple of comments and then maybe Alex you can jump in.

Solomon Moshkevich: Sure.

Solomon Moshkevich: Yes.

Solomon Moshkevich: Good question, Puneet, I think, you know, no change to our discussion back in San Diego at the conference where, you know, we expect that the CRC committee for the NCCN meets regularly, you know, once a year, usually in that late summer timeframe, and, you know, we think that given the timing of the readout that we just described on the call, there's a pretty good chance that they incorporate some of the data that' We do think the Altair readout is pretty critical for that, but as a reminder, we're seeing really strong adoption and trends in the marketplace based on the existing evidence that we have.

Solomon Moshkevich: Good question.

Solomon Moshkevich: No change to.

Solomon Moshkevich: Our discussion vacuum San Diego at the conference where we are.

Solomon Moshkevich: We expect that the CRC committee for the CCN meets regularly once a year usually not in late summer timeframe.

Solomon Moshkevich: And we think that given the timing of the readout.

Solomon Moshkevich: We just described on the call there's a.

Solomon Moshkevich: Pretty good chance that they incorporate some of the data that's reported from Altair.

Solomon Moshkevich: And.

Solomon Moshkevich: We're optimistic that we see something early next year based on our regular timing, we do think the altera readout.

Solomon Moshkevich: Pretty critical.

Solomon Moshkevich: For for that but as a reminder, we're seeing really strong adoption and trends in the marketplace.

Solomon Moshkevich: Based on the existing evidence that we have so.

Solomon Moshkevich: So, you know, Natera being able to achieve its goals in oncology can happen independent of that, but it certainly provides a significant catalyst, and that together with the expected readout in muscle invasive bladder cancer from the Invigor 011 trial, which should independently, you know, assuming that's a positive readout, which remains to be seen, and that would lead to a separate NCCN committee review as well.

Solomon Moshkevich: <unk> being able to achieve its goals.

Solomon Moshkevich: Oncology can happen independent of that but it certainly provides a significant catalyst in.

Solomon Moshkevich: And that together with the expected readout in muscle invasive bladder cancer from the invigorate trial, which should independently assuming that's a positive readout, which remains to be seen and that would lead to a separate NCC in committee review as well.

Solomon Moshkevich: Okay.

Speaker Change: Got it great. Thanks, Solomon and Jeff Places Edwards to add to that so we did surpass the 190 events. So now the data is really being analyzed so in August the results will come out.

Solomon Moshkevich: Solomon, and just a few words to add to that.

Alexey Aleshin: The data is really being analyzed, so in August the results will come out at a top-line level. I think there's been a lot of questions about kind of what good looks like, and I think we've previously referred to the Mosaic study. You know, obviously, we do not control the guidelines, but we do control generating the data, right, to, you know, provide the evidence for those guidelines to, hopefully, be updated. So, you know, I think... In terms of the guidelines timing, I think we should wait and see what the results look like, and I think at that point, we can kind of provide some more guidance.

Alexey Aleshin: At a top line level I think there's been a lot of questions about kind of what good looks like and I think we've previously guided to the mosaic study, obviously, we do not control the guidelines, but we do control generating the data to provide the evidence for those guidelines to hopefully be updated.

Alexey Aleshin: I think.

Alexey Aleshin: In terms of the guidelines timing I think let's see what the results look like and I think at that point, we can kind of provide some more guidance.

Puneet Souda: Got it. Look forward to that. All right. Congratulations, guys.

Speaker Change: Got it and look forward to that alright, congrats guys.

Douglas Anthony Schenkel: All right. Thanks, Puneet. And our next question comes from the line of Doug Schenkel with Wolf Research. Doug, please go ahead.

Speaker Change: Alright, Thanks Puneet.

Douglas Anthony Schenkel: And our next question comes from the line of Doug Schenkel with Wolfe Research Doug. Please go ahead.

Douglas Anthony Schenkel: Hey, good afternoon, guys. You know, as a rule, I, in all these years, I don't think I've ever congratulated anyone on a quarterly performance. But I will at least say I can tell you, given how the market's been recently, we all appreciate a nice, clean, and robust beat.

Douglas Anthony Schenkel: Hey, good afternoon guys.

Douglas Anthony Schenkel: Roy.

Douglas Anthony Schenkel: And all these years I don't think I've ever congratulated and anyone on our quarterly performance, but I will at least say I can tell you given how the market's been recently, we all appreciate a nice clean and robust so with that said.

Douglas Anthony Schenkel: So with that said, let me start with some model questions. On guidance, First, I don't think you're assuming improvement in signatory ASPs, even though coverage expanded at the beginning of the year. Is that just conservatism? And I'm sorry if I missed it, but what is now in guidance for vitae contributions?

Douglas Anthony Schenkel: Let me start with some model questions.

Douglas Anthony Schenkel: On guidance first.

Douglas Anthony Schenkel: I don't think you're assuming improvement in Cigna asps, even though coverage expanded at the beginning of the year is that just conservatism.

Douglas Anthony Schenkel: Sorry, if I missed it but what what what is now in guidance for <unk> contributions.

Mike Brophy: Hey, thanks. Mike, do you want to take that? Yeah, yeah.

Speaker Change: Hey, Thanks, Mike do you want to take that.

Mike Brophy: Yeah, so on the on the ASP.

Mike Brophy: The operative word is stable so I don't expect that.

Mike Brophy: Extremely meaningful.

Mike Brophy: Asps.

Mike Brophy: So the guidance is not dependent on.

Mike Brophy: <unk>.

Mike Brophy: Massive outperformance versus Q1, Asps and we've got some modest ASP improvements, we're seeing a tailwind in the back half of the year, that's pretty achievable.

Mike Brophy: And that would that would contemplate some contribution from the from the expanded coverage. We saw earlier in the year, but again I think if we can if we can do the things that we're trying to do internally I think.

Mike Brophy: That's a potential source of upside versus the guide today, which I think thats the appropriate way to do it.

Mike Brophy: Terms of the <unk> contribution.

Mike Brophy: We had initially with only the benefit of a few weeks.

Mike Brophy: Operating.

Mike Brophy: And those accounts I mean, we had initially carved out something like 20 million that we had in revenues. This year that we would attributed to these DCA accounts, we think.

Mike Brophy: <unk> modestly exceeding that now although I would highlight.

Mike Brophy: Steve mentioned in his prepared remarks around that.

Mike Brophy: Really had a very meaningful step up in the women's health volume sequentially over Q4, which was really quite gratifying to us and when we peel back the onion on that.

Mike Brophy: Vast majority of it is coming from.

Mike Brophy: Organic sources, which I think kind of speaks to the strength of the franchise and our ability to just kind of continue to grow the market and win share in the VA, adding accounts are really just there are additional momentum on top of that but I think fundamentally this is kind of strong underlying performance.

Mike Brophy: So on the ASP, the operative word is stable, so I don't expect, you know, extremely meaningful ASP bumps to the guidance. It is not dependent, you know, on massive outperformance versus Q1 ASPs, and we've got some modest ASP improvement for Signatera in the back half of the year. And the Invitae, you know, added accounts are really just their additional momentum on top of that, but I think fundamentally this is kind of a strong underlying performance. So it's above, I think that Invitae is above expectations, and that's incorporated in the, you know, size of the raise.

Mike Brophy: It's above I think this is above expectations.

Mike Brophy: And Thats incorporated in the size of the of the raise.

Douglas Anthony Schenkel: Okay, thank you for that, and I'll try to be quick with the follow-ups. As a rule, how long would you expect it to take going from guideline expansion to actually seeing ASP increases on the, you know, women's health side? And then, you know, the other one I just wanted to touch on as a cleanup, because we're increasingly getting this question as new investors look at the name: what percentage of signature assays today are for true surveillance versus point in time, MRD? Thank you.

Speaker Change: Okay. Thank you for that.

Douglas Anthony Schenkel: I'll try to be quick with the follow ups.

Douglas Anthony Schenkel: First.

Douglas Anthony Schenkel: As a rule how long would you expect it to take going from guideline expansion to actually seeing ASP increases.

Douglas Anthony Schenkel: On the women's health side and then.

Douglas Anthony Schenkel: The other one I just wanted to touch on as a clean up because we're getting this question increasingly as new investors look at the name what percentage of signature assays today are for true survey on lunch versus point in time MRV. Thank you.

Steve Chapman: Yeah, I'll comment on the first question. One of the things that's really exciting about Natera right now is that we're growing rapidly, we're hitting this cash flow break-even milestone, and we're investing, increasing our investment in the future of the business in both innovation and in the commercial franchise. So, it's great to be doing all of those things at one time and seeing the company's strategy working. But at the same time, we're not really forecasting the impact of these big potential catalysts that could come in the future.

Speaker Change: Yeah I'll comment on the first question. So one of the things that's really exciting about this area right now.

Steve Chapman: We're growing rapidly we're hitting this cash flow breakeven milestone.

Steve Chapman: We're investing increasing our investment in the future of the business in both innovation and in the commercial franchise. So it's great to be doing all of those things at one time and seeing the company strategy.

Steve Chapman: Working but at the same time, we will.

Steve Chapman: Not really forecasting in the impact of these big potential catalysts that could come in the future. For example, as you mentioned the 2000 <unk> guidelines and these can be very significant meaningful events in the future if they do come through and they are positive.

Mike Brophy: For example, as you mentioned, the 22Q guidelines, which could be very significant, meaningful events in the future if they do come through and are positive. The guidelines can impact payer coverage policies very quickly, like within a period of sort of three to six months if they are very definitive. If the guidelines are a little more vague, it can take longer. And so it really depends on what the guidelines say, and we're just going to have to wait and see. On the second question, I think Mike, that was a question for you. Yeah, go ahead.

Mike Brophy: The guidelines.

Mike Brophy: Can impact payer coverage policies very quickly like within a period of three to six months. If the guidelines are very definitive.

Mike Brophy: If the guidelines are a little more vague.

Mike Brophy: It can take longer.

Mike Brophy: Neil potential.

Mike Brophy: Potentially.

Mike Brophy: If it does have an impact at all and so it really depends on what the guideline says.

Mike Brophy: Just going to have to wait and see.

Mike Brophy: On the second question.

Mike Brophy: I think I think what Mike what was the question for you. Yeah. Go ahead, yeah. So the question was on the kind of the mix and Cigna Taro volumes between adjuvant and surveillance and what we've seen is that there is a slight majority of the volumes that are still adjuvant <unk>.

Mike Brophy: Yeah, So the question was the kind of mix in signataria volumes between adjuvant and surveillance. And what we've seen is that there is a slight majority of the volumes that are still adjuvant volumes, and that's been pretty stable now for several quarters, where, you know, initially at launch, all of the units are adjuvant treatment units because patients almost always start with us in signataria in the adjuvant setting. And then as those patients go into remission, we're seeing very high compliance with patients staying with signataria in the surveillance setting, which we find very encouraging.

Mike Brophy: Volumes and Thats been pretty stable now for several quarters.

Mike Brophy: Initially in the launch of course all of the units are adjuvant.

Mike Brophy: Treatment units, because PD patients almost always start with us.

Mike Brophy: <unk> in the adjuvant setting and then.

Mike Brophy: As those patients go into remission.

Mike Brophy: We're seeing very high compliance of patients staying with Cigna.

Mike Brophy: Into the into the surveillance setting, which we find very encouraging is kind of consistent with kind of qualitatively everything you've heard it all.

Mike Brophy: It's kind of consistent with kind of qualitatively everything we've heard about patients' understanding of the utility of the test. So you would, you know, absent other factors, you would expect, you know, steady state to have the vast majority of your volumes be recurrence monitoring volumes. We haven't quite seen that. We've seen some of that trend progression, but we've been holding steady with it. So still, a little bit of the majority is in the adjuvant setting.

Mike Brophy: <unk> understanding of the utility of the test. So you would absent other factors you would expect steady state to have the vast majority of your volumes.

Mike Brophy: Recurrence monitoring volumes, we haven't quite seen that we've seen some of that trend progression, but we've been holding steady work has still has a little bit is the majority is in the adjuvant setting and what's causing that is just the rapid new patient starts. So we continue to see so you think about kind of the top of the funnel just continues to grow really rapidly.

Mike Brophy: And what's causing that is just the rapid, you know, new patient starts that we continue to see. So you think about kind of the top of the funnel just continues to grow really rapidly. So I actually think that, you know, that penalizes your margins in the immediate term, but I think that's a great sign for the progression of the product, you know, in the future. Super helpful.

Mike Brophy: I still think that.

Mike Brophy: That penalizes your margins in the immediate term, but I think that's a great sign for the progression of the product.

Mike Brophy: In the future.

Douglas Anthony Schenkel: Super helpful, thank you. All right. Thanks, Doug. And our next question comes from the line of Catherine Schulte with Baird.

Speaker Change: Super helpful. Thank you.

Catherine Walden Ramsey Schulte: Alright, Thanks, Doug.

Catherine Walden Ramsey Schulte: All right. Thanks, Doug. And our next question comes from the line of Catherine Schulte with Baird. Catherine, please go ahead. Hey guys, thanks for the questions. First, Mike, maybe on that slide from 1Q20.

Douglas Anthony Schenkel: And our next question comes from the line of Catherine Schulte with Baird. Catherine. Please go ahead.

Catherine Walden Ramsey Schulte: Hey, guys. Thanks for the question.

Catherine Walden Ramsey Schulte: First Mike maybe on that slide from <unk> <unk> to earnings that you should do you still feel comfortable with the 70% plus gross margin and 25% plus EBIT margin target when you get to over 2 billion of revenue.

Catherine Walden Ramsey Schulte: I knew that someone was going to come come in that someone asked me about like what about the long term.

Mike Brophy: Yes, no. Thanks for the question Catherine Yes, I mean look I mean, obviously with the revenue trajectory that we've been on $2 billion plus I think you are talking about long term steady state I mean, I think that looks pretty safe.

Catherine Walden Ramsey Schulte: At this point I think we're going to be able to get beyond that.

Catherine Walden Ramsey Schulte: 70% and 25%.

Catherine Walden Ramsey Schulte: EBIT margins I think are are achievable I mean, if you think youre willing to go out a few years and this is not kind of time data guidance as the cash flow breakeven target was but it was more kind of.

Mike Brophy: If you think you're willing to go out a few years, and this is not kind of time-dated guidance, as the cash flow break even target was, but it was more of a conceptual, you know, what the business can do based on the forecasted unit economics. And I think the path, you know, to getting to those types of margins is going to require continued maturation in the Signataria ASP, continued excellent data, prospective data, which we want to publish, and is obviously slated to come down the pipeline; we'll support that.

Mike Brophy: Consensual.

Mike Brophy: What can the business do based on the forecasted unit economics, and I think the path.

Mike Brophy: Getting to those types of margins are going to require continued maturation into Sydney Terra asps.

Mike Brophy: <unk> excellent data prospective data, which we want to publish.

Mike Brophy: Obviously slated to come down the pipeline, we'll support that.

Mike Brophy: I think there's still room to move the women's health margins meaningfully, particularly if you can get some benefit from the <unk>.

Mike Brophy: I think there's still room to move the women's health margins meaningfully, particularly if you can get some benefit from the guideline inclusion that we haven't yet seen, as we talked about in the prepared remarks on the EBIT margins. It's really a function of those couple of variables I just described, plus this concept that, you know, we don't need to grow expenses anywhere near as rapidly as we're seeing the revenue growth So an increasing percentage of every incremental revenue dollar from here drops more to the bottom line, right?

Mike Brophy: Guideline inclusion that we havent yet seen as we've talked about in the prepared remarks on the EBIT margins. It's really a function of those couple of variables I. Just described plus this concept that we don't need to grow expenses anywhere near as rapidly as we're seeing the revenue growth.

Mike Brophy: <unk>, so an increasing percentage of every incremental revenue dollar can hear drops more to the bottom line right and so.

Mike Brophy: And so I do think that, you know, given if you can get the 70% gross margins, you know, at this scale, well beyond $2 billion, I do think that 25% EBIT margins are still in play for us. So really encouraged by the trajectory of the business.

Mike Brophy: I do think that given if you can get to 70% gross margins at this scale.

Mike Brophy: Well beyond $2 billion I do think the 25% EBIT margins are still in play for us So really encouraged.

Mike Brophy: By the trajectory of the business obviously.

Speaker Change: Alright, great and then on the signature of volume outperformance in the quarter are there any particular indications that are driving that strength or is it pretty broad based.

Solomon Moshkevich: Yes, Solomon. Do you want to talk about that? Yeah, great.

Mike Brophy: Yeah. So I mean, we wanted to.

Mike Brophy: Talk about that.

Catherine Walden Ramsey Schulte: First of all, it was really broad-based. I mean, we're seeing great continued adoption and growth in our core areas of colorectal cancer, breast cancer, and IO monitoring. We did see pretty strong bumps in bladder cancer and ovarian cancer. For ovarian cancer, we just recently got coverage from Medicare, so it's great to see that kind of reaction from the marketplace and from physicians. In bladder cancer, there's just a lot of opportunity there, and I think that's a pretty underpenetrated area.

Solomon Moshkevich: Yeah great.

Catherine Walden Ramsey Schulte: First of all.

Catherine Walden Ramsey Schulte: It was really broad based I mean, we're seeing.

Catherine Walden Ramsey Schulte: Great continued adoption and growth in our core areas of colorectal cancer and breast cancer and iron monitoring.

Catherine Walden Ramsey Schulte: We did see.

Catherine Walden Ramsey Schulte: Pretty strong bumps.

Catherine Walden Ramsey Schulte: In bladder cancer and in ovarian cancer.

Catherine Walden Ramsey Schulte: In ovarian cancer, we just recently got the coverage from Medicare. So it's great to see that kind of reaction from the marketplace.

Catherine Walden Ramsey Schulte: Physicians.

Catherine Walden Ramsey Schulte: In bladder cancer.

Catherine Walden Ramsey Schulte: Just a lot of opportunity there and I think that's a pretty underpenetrated space, but both of those together in terms of overall absolute numbers are not as big as colorectal and breast.

Catherine Walden Ramsey Schulte: But both of those together, in terms of overall absolute numbers, are not as big as colorectal and breast and IO monitoring. And the other thing I'll say is, generally speaking, the drivers are, which I think Mike or Steve mentioned earlier, just the number of new physicians ordering the test was very strong in Q1, which led to the outperformance.

Catherine Walden Ramsey Schulte: I am monitoring so.

Catherine Walden Ramsey Schulte: And the other thing I'll say is just generally the drivers are.

Catherine Walden Ramsey Schulte: I think Mike or Steve mentioned earlier.

Catherine Walden Ramsey Schulte: The number of new physicians ordering the test.

Catherine Walden Ramsey Schulte: It was very strong in Q1, which led to the outperformance.

Speaker Change: Great. Thank you.

Matthew Carlisle Sykes: All right, thank you, Catherine. And our final question today comes from the line of Matt Sykes with Goldman Sachs. Matt, please go ahead.

Catherine Walden Ramsey Schulte: Alright, Thank you Catherine and our final question today comes from the line of Matt <unk> with Goldman Sachs. Matt. Please go ahead.

Steve Chapman: Hi, good afternoon. Thanks for taking my questions. Congratulations on the quarter. Steve, for you, this is more of a longer-term question on women's health. Step up you saw in Q1, realize it's one quarter, but it was a pretty impressive quarter. Given the level of market share and penetration, and assuming Invitae revenues kind of doubled this year, what's now, have you changed your long-term expectation for when women's health as a segment would sort of start to normalize growth? Just given the, I guess, relative maturity of that category and just your penetration and market share, any thoughts on how you're thinking about it long-term in terms of growth?

Matthew Carlisle Sykes: Hi, good afternoon, thanks for taking my questions congrats on the quarter.

Steve Chapman: Steve for you just more of a longer term question on women's health just given.

Steve Chapman: Step up you saw in Q1 realized just one quarter, but it was a pretty impressive quarter.

Steve Chapman: Given the level of market share and penetration, assuming and VK revenues kind of fold in this year.

Steve Chapman: Now have you changed your long term expectation for when women's health.

Steve Chapman: Segment would sort of start to normalize growth just given the relative maturity of that category interest your penetration and market share.

Steve Chapman: Any thoughts on how youre thinking about it long term in terms of growth.

Steve Chapman: Yeah, so it's a good question. I mean, you know, obviously, we had an incredible Q1. And what we normally see, and this has always been the case in the women's health business, is that a lot of the growth for the year comes in Q1. And then there's a little bit of a dip in Q2 due to seasonality. And then we start to see things grow again, you know, in the second half of the year. And, you know, that's really kind of been the trend for a long period of time.

Steve Chapman: Yes. So that's a good question I mean, obviously, we had an incredible Q1 than what we normally see in this has always been the case and women's health businesses and a lot of the growth for the year comes in Q1, and then Theres a little bit of a dip in Q2 due to seasonality and then we start to see kind of things grew again in the second half of the year.

Steve Chapman: Yes, that's really kind of been the trend for a long period of time, we think we have somewhere around like 50% share and the market slightly over 50% penetrated so there's still a long way to go.

Steve Chapman: You know, we think we have somewhere around a 50% share, and the markets are, you know, slightly over 50% penetrated. So there's still a long way to go. You know, we're actually seeing opportunities, you know, both competitive wins for some of the more established players, but also still, you know, new conversions where people are moving from serum screening over to NIPT or carrier screening, where they're going from, you know, looking at just testing a single gene to maybe a series of genes or sort of a broader panel.

Steve Chapman: We're actually seeing opportunities both competitive wins.

Steve Chapman: For some of the more established players, but also still new conversions, where people are moving from serum screening over to an IP T or on carrier screening where they're going from.

Steve Chapman: Looking at just testing the single gene can maybe a series of genes or sort of a broader panel.

Steve Chapman: So we think there's a lot of opportunity ahead of us. And, you know, obviously, at some point, you start to get more Asp and revenue growth. And, you know, there's still a lot of tests that we're doing today where, you know, we're not getting coverage, where we think there's upside opportunity. Particularly, I think we mentioned 22 Q, you know, where we have a very high attachment rate, and those are generally not reimbursed.

Steve Chapman: So we think Theres a lot of opportunity ahead of US I think obviously at some point you start to get get more.

Steve Chapman: Further penetrated.

Steve Chapman: Space, but we're always innovating and we always have new things coming out for example, with your H launch and east create opportunity for us and.

Steve Chapman: So we said before we've got a lot of new stuff coming out both on the <unk> side.

Steve Chapman: We said, we have product enhancements and new products coming but also on the women's health side, where we have new products and product enhancements coming so we're still very excited about the opportunity to help more patients.

Steve Chapman: And then keep in mind.

Steve Chapman: It's not just about volume growth. It's also about.

Steve Chapman: I think there are some opportunities there. Now, obviously, the guidelines come in, but there's still a lot of room to improve ASPs by increasing coverage for things like carrier screening, you know, or even still some of the base panorama testing. So there's lots of opportunity ahead, and we feel good about it.

Steve Chapman: ASP and.

Steve Chapman: And revenue growth and there's still a lot of tests that we're doing today, where we're not getting coverage, where we think theres upside opportunity.

Steve Chapman: Particularly I think we've mentioned 20, <unk>, where we have a very high attachment rate and those are generally not reimbursed I think there's some opportunities there.

Steve Chapman: Obviously, the guidelines come in but Theres still a lot of room to improve asps.

Steve Chapman: By increasing coverage for things like carrier screening.

Steve Chapman: Even still some of the some of the base Panorama testing so lots of opportunity ahead, and we feel good about it.

Matthew Carlisle Sykes: Great. Thanks for that.

Mike Brophy: And then, Mike, just a modeling question. I understand the true-ups are not embedded in the guide, but given your focus on cash collections, like, how should we think about true-ups over the course of the year? I'm sure there's some unpredictability to it, but just wanted to get your sense for how you should be thinking about these true-ups Q2 through Q4.

Speaker Change: Great. Thanks for that and then Mike just a modeling question.

Mike Brophy: And the true ups are not embedded in the guide.

Mike Brophy: But just given your focus on cash collections like how should we think about trips over the course of the year Im sure Theres some unpredictability about it.

Mike Brophy: But I just wanted to get your sense for how we should be thinking about this true ups Q2 through Q4.

Matthew Carlisle Sykes: Yes, it's a good question. I mean, the reason why we typically don't include it in the guide is that it's not our intention when we set the accrual; we're trying to set it, you know, exactly 100%. But of course, you'd rather be collecting at 101% than at 95%, for example. So that's, that's on my mind, you know, when we set the accrual. I think in terms of the guide, I really, I don't have a way to tell you, hey, there's going to be X amount of Q2 versus Q4. My goal is just to have

Mike Brophy: Yes, it's a good question I mean, the reason why we said we don't include it in the guidance.

Matthew Carlisle Sykes: Our intention when we set the accrual we're trying to set it exactly 100% by of course he'd rather be you'd rather collected 101% than 95%. For example, so that's that's on my mind, when we said the accrual.

Matthew Carlisle Sykes: I think in terms of the.

Matthew Carlisle Sykes: The guide I really I don't have a way to tell you hey, there's going to be X amount in Q2 versus Q4. My goal is to have the accruals that are 100% and let's see where we land.

Matthew Carlisle Sykes: Got it. Thanks very much, guys.

Speaker Change: Got it thanks very much.

Greg: All right. Thank you, Matt.

Speaker Change: All right. Thank you Matt.

And ladies and gentlemen, that is our time today. That concludes today's call. Thank you all for joining, and you may now disconnect. Have a great day, everyone.

Speaker Change: And ladies and gentlemen that is our time today that concludes today's call. Thank you all for joining and you may now disconnect have a great day everyone.

Greg: [music].

Greg: Okay.

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Greg: Yeah.

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Greg: Okay.

Greg: Yes.

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Greg: Okay.

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Greg: Okay.

Greg: Yes.

Greg: Yes.