Q4 2024 23andMe Holding Co Earnings Call

Okay.

Operator: Hello, and welcome to 23andMe's fiscal year 2024 fourth quarter and full year financial results conference call. As a reminder, this call is being recorded. At this time, all participants are in a listen-only mode. After the prepared remarks, there will be a question and answer session. I would now like to turn the call over to Ian Cooney, Senior Director of Investor Relations at 23andMe, to lead off the call. Thank you.

Speaker Change: Hello, and welcome to 'twenty three in mid fiscal year 2020 for fourth quarter and full year financial results Conference call.

Speaker Change: As a reminder, this call is being recorded.

At this time all participants are in a listen only mode.

Speaker Change: After the prepared remarks, there will be a question and answer session.

Speaker Change: I would now like to turn the call over to Anne Cooney Senior director of Investor Relations at 23, and me to lead off the call. Thank you go ahead.

Ian Cooney: Thank you. Before we begin, I encourage everyone to go to investors.23andme.com to find the press release we issued earlier today reporting our financial results for the fourth quarter and full year. A replay of today's webcast will also be available on our website. Please note that certain statements made during this call regarding matters that are not historical facts, including but not limited to management's outlook or predictions for future periods, are forward-looking statements. These statements are based solely on information that is now available to us.

Anne Cooney: Thank you.

Speaker Change: Again, I encourage everyone to go to the investors back 23, <unk> Dot com to find the press release issued earlier today reporting our financial results for the fourth quarter and full year.

Speaker Change: Play of todays webcast will also be available on our website.

Speaker Change: Please note that certain statements made during this call regarding matters that are not historical facts, including but not limited to management's outlook or predictions for future periods are forward looking statements. These statements are based solely on information that is now available to us.

Ian Cooney: We encourage you to review the section entitled Forward-Looking Statements in our press release, which applies to this call. Also, please refer to our SEC filing, which can be found on our website and the SEC's website, for a discussion of numerous factors that may impact our future performance. We also discuss certain non-GAAP measures. Important information on our use of these measures and reconciliation to U.S. GAAP may be found in our Earnings. Joining us on our call today are Anne Wojcicki, our Chief Executive Officer and Co-Founder, and Joseph Selsavage, our Chief Financial and Accounting Officer. Jennifer Low, our Head of Therapeutic Development, will join us for Q&A. I'd now like to turn the call over to Joe. Thank you, Ian.

Speaker Change: We encourage you to review the section entitled forward looking statements in our press release, which applies to this call.

Speaker Change: So please refer to our SEC filings, which can be found on our website and the sec's website for a discussion of numerous factors that may impact our future performance.

Speaker Change: I will discuss certain non-GAAP measures important information on our use of these measures and reconciliations to U S. GAAP may be found in our earnings release.

Speaker Change: Joining us on our call today are and which is our chief Executive Officer, and co founder and Joe sell Savage, our Chief financial and Accounting Officer, Jennifer Lowe, our head of therapeutic development will join us for Q&A.

Speaker Change: I would now like to turn the call over to Joe.

Joseph Selsavage: Thank you, Ian. Hello, everyone.

Joseph Selsavage: Thank you, Ian and Hello, everyone I'd like to start by addressing the topic that is likely top of mind for everyone. On this call on March 28, 2024, the board of directors of <unk> formed a special committee comprised of independent directors to review strategic alternatives that may be available to 23 and me.

Joseph Selsavage: I'd like to start by addressing the topic that is likely top of mind for everyone on this call. On March 28, 2024, the Board of Directors of 23andMe formed a special committee comprised of independent directors to review strategic alternatives that may be available to 23andMe to maximize shareholder value. On April 18, 2024, the company announced that it had become aware that Anne Wojcicki, Chief Executive Officer, Co-Founder, and Chair of the Board of Directors of 23andMe, was considering making a proposal to acquire all of the outstanding shares of 23andMe that she does not currently own, as she stated in an amendment dated April 17, 2024, to her Schedule 13D filing with the Securities and Exchange Commission.

Joseph Selsavage: To maximize shareholder value.

Justin: On April 19, 2024, the company announced it has been made aware of that and what Justin Chief Executive Officer Co founder and chair of the board of directors of <unk> was considering making a proposal to acquire all of the outstanding shares of <unk> that she does not currently.

Justin: As he stated and an amendment dated April 17, 2020 for two of our scheduled 13D filing with the Securities and Exchange Commission.

Joseph Selsavage: Ms. Wojcicki also indicated in her Schedule 13b filing that she wishes to maintain control of 23andMe and, therefore, will not be willing to support any alternative transactions. The Special Committee will carefully review Ms. Wojcicki's proposal, when and if it is made available, and evaluate it in light of other available strategic alternatives, including continuing to operate as a publicly traded company. The special committee is committed to acting in the best interests of 23andMe and its shareholders.

Speaker Change: Mr. <unk> also indicated in our scheduled 13D filing that she wishes to maintain control of 20, <unk> and therefore will not be willing to support any alternative transaction.

Speaker Change: The Special Committee will carefully review Mr. <unk> proposal when it has made available and evaluate it might have other available strategic alternatives, including continuing to operate as a publicly traded company.

Speaker Change: The Special Committee is committed to acting in the best interest of <unk> and its shareholders.

Joseph Selsavage: There can be no assurances that the foregoing will result in any particular outcome, and 23andMe does not intend to comment further on these matters until 23andMe determines that additional disclosure is appropriate or required by law. This call is focused solely on the company and its earnings relief, and we will not be addressing or responding to any questions regarding the aforementioned matters on this call. I'd now like to turn the call over to Anne.

Speaker Change: There can be no assurances that the foregoing will result in any particular outcome and 23 <unk> does not intend to comment further on these matters until 'twenty Randy determined that additional disclosure is appropriate or required by law.

Speaker Change: This call is focused solely on the company and its earnings release, and we will not be addressing or responding to any questions regarding the aforementioned matters on this call.

Speaker Change: I would now like to turn the call over to Ann.

Ann: Thank you Joe.

Anne Wojcicki: Fiscal 2024 was a productive yet transitional year at 23andMe. The conclusion in July of the exclusive period of our Discovery and Development Collaboration Agreement with GSK, combined with a more constrained capital markets and fundraising environment, necessitated a significant change in the strategic direction of the company.

Ann: Fiscal 2024 was a productive yet transitional year at 23 and me.

Ann: The conclusion in July of the exclusive period of our discovery and development collaboration agreement with GSK.

Ann: Combined with a more constrained capital markets and fundraising environment necessitated a significant change in the strategic direction of the company.

Anne Wojcicki: We refocused our business on our highest value programs and therapeutics and prioritized higher margin services in creating value for our membership programs in our consumer business. We also began to reimagine how to best leverage our data to create value for customers, partners, and shareholders. The result is an operating model that will look different in the coming years, but it's designed to reflect a company that remains committed to improving the health of millions of people worldwide.

Ann: We refocused our business on our highest value programs in therapeutics, and prioritize higher margin services and creating value for our membership programs in our consumer business.

Ann: We also began to re imagine how to best leverage our data to create value for our customers partners and shareholders.

Ann: The result is an operating model that will look different in the coming years, but is designed to reflect the company that remains committed to our vision of improving the health of millions of people worldwide.

Anne Wojcicki: As a first priority, we are focusing on driving profitable growth in high-return uses of cash. This means prioritizing memberships in our PGS segment, driving growth in telehealth, and leveraging our data assets to create a sustainably growing profitable research business. It also means that we are looking for ways to fund the continued development of our clinical assets while limiting the use of cash on our balance, starting with the PGF system.

As a first priority we are focusing on driving profitable growth and high return uses of cash.

Speaker Change: This means prioritizing memberships in our Pts segment.

Speaker Change: Driving growth in telehealth, and leveraging our data assets to create a sustainably growing profitable research business.

Speaker Change: It also means that we are looking for ways to fund the continued development of our clinical assets, while limiting the use of cash on our balance sheet.

Speaker Change: Starting with the Pts business.

Anne Wojcicki: We are excited to announce that we have passed the 15 million customer milestone. This is a testament to the hard work of our employees and to the power and value of genetic information. We continue to innovate in both our ancestry and health offerings to drive growth and add value to our platform, specifically in our membership services. We have a compelling pipeline of premium features planned for our Ancestry platform and recently rolled out an exciting new feature called Historical Matches, enabling Premium Plus members to learn about their genetic connections to hundreds of interesting figures from history.

Speaker Change: We're excited to announce that we have passed the $15 million customer milestone.

Speaker Change: This is a testament to the hard work of our employees and to the power and value of genetic information.

Speaker Change: We continue to innovate in both our ancestry and health offerings to drive growth and add value to our platform specifically in our membership services.

Speaker Change: We have a compelling pipeline of premium features planned for our ancestry platform and recently rolled out an exciting new feature called historical match it.

Speaker Change: Enabling premium plus members to learn about their genetic connections to hundreds of interesting figures from history.

Anne Wojcicki: We also added a number of new regions to bring our industry-leading total to over 3000. In health, a major component of our vision is to build a scalable preventive health service. We think this is best achieved through driving membership growth on our platform as it enables us to help our customers improve their health and manage risk over time. The membership model also enables a scalable, sustainable business model that will allow us to create value for shareholders while reinvesting in innovation to continue to improve the value of our offerings for customers.

Speaker Change: We also added a number of new agents to bring our industry, leading total to over 3000.

Speaker Change: And health a major component of our vision is to build a scalable preventive health service.

Speaker Change: We think this is best achieved through driving membership growth on our platform as it enables us to help our customers improve their health and manage risk over time.

Speaker Change: The membership model also enables a scalable sustainable business model that will allow us to create value for shareholders, while reinvesting in innovation to continue to improve the value of our offerings for customers.

Anne Wojcicki: We are focused on the delivery of ongoing health value and accountability to customers, and our product development for our consumer products is largely centered in this area. We started with the recent rollout of personalized health features like Health Action Plan and Health Tracks and have begun integrating telehealth into our offering with the rollout of Total Health. In Q4, we announced the availability of three new genetic reports for 23andMe plus members on breast, colorectal, and prostate cancer.

Speaker Change: We are focused on the delivery of ongoing health value and accountability to customers and our product development for our consumer products is largely centered in this area.

Speaker Change: We started with the recent rollout of personalized health features like health action plan and health tracks and have begun integrating telehealth into our offering with the rollout of total health.

Speaker Change: In Q4, we announced the availability of three new genetic reports for 20, <unk> plus members on breast colorectal and prostate cancer.

Anne Wojcicki: The reports are based on statistical models known as polygenic risk scores, developed by 23andMe through our proprietary research database. Our new cancer PRS reports identify individuals with a higher likelihood of developing three of the most common cancers, the majority of whom are invisible to the health care system today. Those individuals are then matched to the appropriate next steps through health action plans.

Speaker Change: The reports are based on statistical models now known as polygenic risk scores.

Speaker Change: Developed by <unk> 23, and me through our proprietary research database.

Speaker Change: Our new cancer Prs reports identify individuals with a higher likelihood of developing three of the most common cancers. The majority of whom are invisible to the healthcare system today.

Speaker Change: Those individuals are then matched to the appropriate next steps to help health action plan.

Anne Wojcicki: By empowering more people with this knowledge, we can help make cancer screening, prevention, early detection, and treatment more effective. We continue to work to make the membership platform even more engaging and useful for customers in tracking and impacting their personalized health journeys. And I am pleased to report that our retention rates in Q4 improved from the previous three quarters, while membership revenue grew by 41% year over year to $20 million. We are also prioritizing growth in our Lemonade Telehealth business and have begun to make meaningful strides while investing in a pipeline of future value drivers. Over the past few quarters, the telehealth business has generated positive gross margins while decreasing advertising spend at the same time, leading to improvements in our bottom line. And we expect this trend to continue.

Speaker Change: By empowering more people with this knowledge, we can help make cancer screening prevention early detection and treatment more effective.

Speaker Change: We continue to work to make the membership platform, even more engaging and useful for customers in tracking and impacting their personalized health journey and I am pleased to report that our retention rates in Q4 improved from the previous three quarters, while membership revenue grew by 41% year over year to $20 million.

Speaker Change: We are also prioritizing growth in our laminate telehealth business and have begun to make meaningful strides while investing in our pipeline of future value drivers.

Speaker Change: Over the past few quarters. The telehealth business has generated positive gross margins, while decreasing advertising spend at the same time, leading to improvements in our bottom line.

Speaker Change: And we expect this trend to continue.

Anne Wojcicki: In Q4, we launched over-the-counter options and quarterly plans, which are contributing to a meaningfully improved LTV. We also just announced the launch of one of the industry's leading fast-acting ED medications, Enstendra, and expect a further addition to our offerings in the coming year. Overall, I'm very optimistic about the future of our consumer business. I believe we have only scratched the surface in delivering value and engaging with customers on their health journey. Moving to the research business

Speaker Change: In Q4, we launched over the counter options and quarterly plans, which are contributing to a meaningfully improved LTV.

Speaker Change: We also just announced the launch of one of the industry's leading fast acting <unk> medications and Sandra and expect to further add to our offerings in the coming year.

Speaker Change: Overall, I am very optimistic about the future of our consumer business I believe we have only scratched the surface in delivering value and engaging with customers on their health journey.

Anne Wojcicki: Fiscal 2024 was the year of transition and learning for research. We were very pleased to announce GSK extended our agreement on a non-exclusive basis in October, showing the ongoing value in drug discovery and development of engaging with the world's largest reconstructible DNA data engine. I'm extremely encouraged by the potential for this business and by the interest shown by potential partners throughout the drug discovery and development ecosystem, and believe research will be a strong source of growth, profitability, and innovation as market conditions improve. On the innovation front, we are excited by recent advances in deep learning that will eventually enable us to train DNA language models to study the grammar of the genome.

Speaker Change: Moving to the research business fiscal 2024 with a year of transition and learning for research. We were very pleased to announce GSK extended our agreement on a nonexclusive basis in October showing the ongoing value and drug discovery and development of engaging with the world's largest re contactable DNA data engine.

Speaker Change: I am extremely encouraged by the potential for this business and by the interest shown by potential partners throughout the drug discovery and development ecosystem and.

Speaker Change: And believe research will be a strong source of growth profitability and innovation as market conditions improve.

Speaker Change: On the innovation front, we are excited by recent advances in deep learning that will eventually enable us to train DNA language models to study the grammar the genome.

Anne Wojcicki: We expect these methods to rapidly grow our ability to predict disease and provide compelling personalized health recommendations for customers. Using our database and AI, we are building features with the goal of becoming the world's best at genetic health risk prediction to help customers understand the impact of their lifestyle on disease prevention. 23andMe is actively developing AI models to enhance both its consumer and data partnership business. In the short term, the company is utilizing existing large language models to potentially expand support for clinicians.

Speaker Change: We expect these methods to rapidly grow our ability to predict disease and provide compelling personalized health recommendations for customers.

Speaker Change: Using our database in AI. We are building features with the goal of becoming the world's best of genetic health risk prediction to help customers understand the impact of their lifestyle and disease prevention.

Speaker Change: 23 me is actively developing AI models to enhance both its consumer and data partnership businesses.

Speaker Change: In the short term the company is utilizing existing large language model to potentially expand support for clinics clinicians.

Anne Wojcicki: In the future, 23andMe hopes to launch various AI models aimed at improving services for both customers and biotech partners. In the consumer space, this includes new predictive models for delivering personalized health recommendations more effectively. For biotech use cases, we are developing AI models that better predict the impact of genetic variation on cellular function.

Speaker Change: And the future 'twenty, three and we hope to launch various AI models aimed at improving services for both customers and biotech partners.

Speaker Change: In the consumer space. This includes new predictive models for delivering personalized health recommendations more effectively.

Speaker Change: For biotech use cases, we are developing AI models that better predict the impact of genetic variation on cellular function.

Anne Wojcicki: These initiatives utilize the company's unique database to accelerate target discovery and improve the probability of success in the drug discovery business. With recent breakthroughs in AI, we believe we are well placed to enable customers to explore potential health outcomes, understand how their lifestyle choices impact disease prevention, and surface new therapeutic opportunities for our partners. Moving to the therapeutics business, we made significant progress in fiscal 2024.

Speaker Change: These initiatives utilize the company's unique database to accelerate target discovery and improve the probability of success in the drug discovery business.

Speaker Change: With recent breakthroughs in AI, we believe we are well placed to enable customers to explore potential health outcomes.

Speaker Change: Understand how their lifestyle choices impact disease prevention.

Speaker Change: In surface, new therapeutic opportunities for our partners.

Speaker Change: Moving to the therapeutics business, we made significant progress in fiscal 2024.

Anne Wojcicki: We are pleased to announce we've completed enrollment in the Phase 2a study for 23andMe 610 and also recently announced we've moved our second immuno-oncology asset, 23andMe 1473, into the clinic and begun dosing patients in Phase 1. For 6.10, we will be presenting safety, efficacy, and biomarker data from two of our phase two cohorts at ASCO on June 1st and June 3rd We expect to present additional data from the 610 Phase 2a at additional upcoming medical meetings and data from the 1473 phase one in calendar year 2025.

Speaker Change: We are pleased to announce we've completed enrollment in the phase Iia study for 23 and me 610, and also recently announced we've moved our second immuno oncology asset 23, and me $14 73 into the clinic and begun dosing patients in phase one.

Speaker Change: For <unk>, we will be presenting safety efficacy and biomarker data from two of our phase II cohorts at <unk> on June <unk> and June <unk>.

Speaker Change: We expect to present additional data from the <unk> phase Iia at additional upcoming medical meetings and data from the $14 73 phase one in calendar year 2025.

Anne Wojcicki: As I look toward the future, I'm excited about the opportunities for 23andMe to grow and impact our customers. We are a leader in genetic and data-based health, and we continue to innovate and lead. The interest in data and AI, combined with our world-leading genetic and phenotypic data engine, portend amazing opportunities for our research business. And in therapeutics, we are incredibly excited by the potential of our clinical assets and the future value they may bring to patients and to the company. And with that, I'll turn the call over to Joe to review our financial results for the quarter.

Speaker Change: As I look towards the future I am excited about the opportunities for 23 and me to grow and impact our customers.

Speaker Change: We are a leader in genetic and database health and we continue to innovate and lead the.

Speaker Change: The interest in data and AI combined with our world, leading genetic and phenotypic data engine portend amazing opportunities for our research business and then therapeutics. We are incredibly excited by the potential of our clinical assets and future value. They may bring to patients and to the company.

Speaker Change: And with that I will turn the call over to Joe to review, our financial results for the quarter.

Joseph Selsavage: Thank you, Anne. I'd like to reiterate Anne's excitement about the future of precision healthcare at 23andMe, and I'm proud of our ability to execute while maintaining cross-discipline amid our shift toward a more sustainable operating profile. Revenue for the quarter and the year was $64 million and $220 million, respectively, representing a 31% decrease and a 27% decrease, respectively, over the same periods in the prior year. Similar to the last few quarters, the year-over-year decrease in revenue was primarily due to the conclusion of the exclusive discovery term under our GSK collaboration in July, as well as lower consumer services revenue in our PGS kit and telehealth business.

Joseph Selsavage: Thank you and I'd like to reiterate and excitement about the future of precision health care 23, and me and I'm proud of our ability to execute while maintaining cost discipline, our shift towards a more sustainable operating profile.

Joseph Selsavage: Revenue for the quarter ended the year with $64 million and $220 million, respectively, representing a 31% decrease and a 27% decrease respectively over the same periods in the prior year.

Joseph Selsavage: Similar to the last few quarters.

Joseph Selsavage: Year over year decrease in revenue was primarily due to the inclusion of exclusive discovery term under our GSK collaboration in July as well as lower consumer services revenue and our PGS kit and Telus health businesses.

Joseph Selsavage: The decrease in consumer revenue was driven by our focus on marketing efficiency and membership sales, both of which have resulted in improved unit economics and customer lifetime value but lower sales across the consumer offering. We expect that these decisions will continue providing benefits to our margins over the short and longer term.

Joseph Selsavage: The decrease in consumer revenue was driven by our focus on marketing efficiency and membership sales both of which have resulted in improved unit economics and customer lifetime value, but lower sales across the consumer offerings.

Joseph Selsavage: We expect that these decisions will continuing to providing benefits to our margins over the short and longer term.

Joseph Selsavage: These decreases were partially offset by continued growth in our subscription service. Looking at the composition of our revenue, Consumer Services revenue represented 99% and 92% of total revenue for the quarter and the year, respectively, and Research Services revenue, which was primarily derived from our other research partners, accounted for approximately 1% and 8% of total revenue, respectively, for those same periods. As a reminder, the new GSK data license announced in Q3 is expected to have minimal impact on this year's results, with the majority landing in fiscal year 25, given the terms of the agreement.

Joseph Selsavage: These decreases were partially offset by continued growth in our subscription services.

Joseph Selsavage: Looking at the composition of our revenue consumer services revenue represented 99% and 92% of total revenue for the quarter and the year respectively.

Joseph Selsavage: And research services revenue, which was primarily derived from our other research partners accounted for approximately 1% and 8% of total revenue respectively for those same periods.

Joseph Selsavage: As a reminder.

Joseph Selsavage: GSK licensed announced in Q3 is expected to have minimal impact from this year's results with the majority of landing in fiscal year 'twenty five given the terms are between them.

Joseph Selsavage: Her gross profit for the fourth quarter and the year was $27,099,000,000,000, respectively, representing a 32% decrease and 26% decrease, respectively, over the same periods in the prior year. The decreases were driven primarily by the decrease in research services revenue, while subscription revenue, higher ASPs on our PGS kits, and improved telehealth margins following the August 23 disposition of Lemonade Health Ltd. in the UK. Turning to our expenses, total operating expenses for the quarter and the year were $239 million and $781 million, respectively, compared to $109 million and $459 million for the same period in the prior year.

Joseph Selsavage: Our gross profit for the fourth quarter, and the year was $27 million and $99 million, respectively, representing a 32% decrease and 26% decrease respectively over the same periods in the prior year.

Joseph Selsavage: The decreases were driven primarily by the decrease in research services revenue, while subscription revenue higher.

Joseph Selsavage: Asps on our PGS.

Joseph Selsavage: And improve how we help margins following the August 23 disposition or eliminate limited in the UK.

Joseph Selsavage: Turning to our expenses total operating expenses for the quarter and the year were $239 million and $781 million respectively.

Joseph Selsavage: Compared to $109 million and 459 million for the same period in the prior year.

Joseph Selsavage: The increase in operating expenses for the quarter and the year was primarily due to $153 million and $352 million, and non-cash goodwill impairment charges taken for the quarter and the year, respectively, and was partially offset by lower personnel-related expenses following workforce reductions in the prior quarters and the disposition of the UK NGOs, along with lower therapeutics-related R&D spend due to a significant reduction in the GSK collaboration program.

Joseph Selsavage: The increase in operating expenses for the quarter and the year was primarily due to $153 million and $352 million.

In noncash goodwill impairment charges taken in quarter and the year respectively.

Joseph Selsavage: And was partially offset by lower personnel related expenses following workforce reductions in the prior quarters and the disposition of the U K entity.

Joseph Selsavage: Along with lower therapeutics related R&D spend due to a significant reduction in the GSK collaboration programs.

Joseph Selsavage: Looking at the bottom line, net loss for the quarter and the year was $209,667,000,000, respectively, compared to net losses for the same period in the prior year of $64,312,000,000. The increase in fourth quarter and full year net loss was driven mainly by the goodwill impairment charge mentioned previously. I would also like to point out that the full year fiscal 24 results are preliminary.

Joseph Selsavage: Looking at the bottom line net loss for the quarter and the year were $209 million and $667 million respectively.

Joseph Selsavage: Net losses for the same periods in the prior year of $64 million and $112 million.

Joseph Selsavage: The increase in fourth quarter and full year net loss was driven mainly by the goodwill impairment charge mentioned previously.

Joseph Selsavage: I would also like to point out that the full year fiscal 'twenty four results are preliminary.

Joseph Selsavage: We are still completing our assessment of our impairment review of goodwill and long-lived assets, and our impairment expense is undergoing further evaluation. This could result in an adjustment to the impairment recorded in our operating expenses and impact our net loss.

Joseph Selsavage: We are still completing our assessment of our impairment review of goodwill.

Joseph Selsavage: And long lived assets.

Joseph Selsavage: And our impairment expenses undergoing further evaluation.

Speaker Change: This could result in an adjustment to the impairment recorded in our operating expenses and impact our net loss.

Joseph Selsavage: However, it is important to point out that any adjustment would be a non-cash item and reflected in our annual report on Form 10-K for the year ended March 31st, 2021. Next, our adjusted EBITDA. For details on how we define adjusted EBITDA, as well as the corresponding reconciliations to GAP, please see our earnings report. The total adjusted EBITDA deficit for the fourth quarter was $33 million, compared to a $39 million deficit for the same period in the prior year. The total adjusted EBITDA deficit for the year was $176 million, compared to a $161 million deficit for the same period in the prior year.

Speaker Change: However, it is important to point out that any adjustment would be a non cash item and reflected in our annual report on Form 10-K for the year ended March 31 2024.

Speaker Change: Next our adjusted EBITDA.

Speaker Change: For details on how we define adjusted EBITDA as well as the corresponding reconciliations to GAAP. Please see our earnings release.

Speaker Change: Total adjusted EBIT, a deficit for the fourth quarter was $33 million compared to 39 million deficit for the same period in the prior year.

Speaker Change: Total adjusted EBIT, a deficit for the year was $176 million compared to a 161 million deficit for the same period in the prior year.

Joseph Selsavage: Despite the decline in revenue, we made meaningful progress in managing our expenses, and we ended the year with $216 million in cash and cash equivalents compared to $387 million as of March 31, 2020. We continue to be judicious with our cash usage and believe that the current level of cash supports 23andMe's plans for targeted investment and high ROI growth initiatives. We also announced on May 9th that the company received a notification letter from NASDAQ notifying the company that it had been granted an additional 180 days, or until November 4th, 2024, to regain compliance with the minimum bid requirements for continued listing on the NASDAQ capital market.

Speaker Change: Despite the decline in revenue, we made meaningful progress in managing our expenses.

And we ended the year with $216 million in cash and cash equivalents compared to $387 million as of March 31 2023.

Speaker Change: We continue to be judicious with our cash usage and believes that the current level of cash support 20, <unk> plan for targeted investments in high ROI growth initiatives.

Speaker Change: We also announced on May nine the company received a notification letter from NASDAQ notifying the company that have been granted an additional 180 days or until November four 2020 for them to regain compliance with the minimum bid requirement for continued listing on the national NASDAQ capital market.

Joseph Selsavage: CERN AIDS and Guidance. In light of the previously mentioned special committee review of strategic alternatives, the company is not providing financial guidance at this time. Wrapping up, we are pleased with the company's strategic progress and are looking forward to an exciting year ahead. We remain focused on realizing our vision while maintaining operating discipline and a focus on higher return investments. I am incredibly optimistic about the future of the company and our ability to help people access, understand, and benefit from the human genome. [inaudible]

Speaker Change: Turning to guidance.

Speaker Change: In light of the previously mentioned Special Committee review of strategic alternatives. The company is not providing financial guidance at this time.

Speaker Change: Wrapping up we are pleased with the company's strategic progress and are looking forward. So an exciting year ahead, we remain focused on realizing our vision, while maintaining operating discipline and a focus on high return investments I'm incredibly optimistic about the future of the company and our ability to help people access understand it.

Speaker Change: The benefit from the human genome.

Speaker Change: With that let's open it up to questions.

Operator: To ask a question, please press star 1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. Our first question will come from the line David Lebowitz with Citi. Thank you.

Speaker Change: To ask a question. Please press star one one on your telephone and wait for your name to be announced.

Speaker Change: To withdraw your question. Please press star one again.

Speaker Change: Our first question will come from the line of David Leibowitz with Citi.

David Neil Lebowitz: Thank you very much for taking my question. Would you be able to help frame expectations for the Phase 2 update that's coming to ASCO?

David Neil Lebowitz: Thank you very much for taking my question would you be able to help frame expectations for the phase two update that's coming in the ESCO.

Jennifer Low: Yes, let me hand, it over to Jennifer Yes.

Jennifer Low: Yeah, we're excited to be able to present the first efficacy, safety, and biomarker data on two of our cohorts, the neuroendocrine and ovarian cohorts, which enrolled more quickly last year. But that data is embargoed until the presentation of the abstracts, just before the study starts, but just before the conference starts. But we have released the titles and the time, and we will present the posters on our investor website and the therapeutics website when they become available on the day of presentation.

Jennifer: We're excited to be able to present, the first efficacy safety and biomarker data on two of our cohorts and neuro endocrine and ovarian cohorts, which involves more quickly last year.

Speaker Change: Data is embargoed until the.

Jennifer: Presentation of the abstracts.

Speaker Change: For the study starts.

Speaker Change: But just before the conference started but.

Speaker Change: Yeah.

Speaker Change: We believe the titles in decline and we will present, the posters on our investor website, and the therapeutics website when they become available on the day of presentation.

David Neil Lebowitz: Thank you for that. And in terms of product, Nick. At present and going forward, what do you see as the biggest drivers of margin expansion as the year progresses?

Speaker Change: Thank you for that and in terms of product mix.

Speaker Change: At present and going forward.

Speaker Change: You see as the biggest drivers of margin expansion.

Speaker Change: Disputes.

Unknown Speaker: Unknown Speaker Sure. You know, for us, it is really focused on membership revenue. You know, we've really seen improvements in our subscription revenue this year, as we increased the price from $29 to $69. And I know on our 23andMe plus memberships, we've continued to see great retention rates. And, you know, and people really love it, and we're continuing to add value to that subscription as well. So that recurring revenue will help us, and it's high-margin dollars added to our bottom line. At what point do you think you'll have it?

Speaker Change: So you want to take that sure.

Speaker Change: It isn't really focused on membership revenue.

Speaker Change: See improvements in our subscription revenue this year.

Speaker Change: As we increase the price of $29 $69.

Speaker Change: On our 2020, plus memberships, we've continued to see great retention rates and and people really and we're continuing to add value in that subscription as well so that recurring revenue will help us and it's high margin dollars.

Speaker Change: Our bottom line.

David Neil Lebowitz: At what point do you think you'll have a fair degree of, I guess, visibility on the extent that the customer base is proceeding post the price increase? Sorry, say again. Can you explain no more? I'm just asking at what point do you think you have a fair degree of visibility on retention of customers post the price increase?

Speaker Change: At what point do you think Youll have a fair degree.

Speaker Change: So I guess visibility on.

Speaker Change: <unk>.

Speaker Change: The extent that the customer base is.

Speaker Change: Proceeding.

Speaker Change: The price increases.

Speaker Change: Alright, So again can you explain omar.

Omar: I'm just asking about at what point do you think youll have a fair degree of visibility on retention.

The customers post price increases.

Unknown Speaker: You know, basically, we increased prices in mid-2024. So we're seeing people who are new to this, you know, basically, coming up in, you know, basically from May forward. So I think we'll start to see these retention rates going forward into the next quarter and beyond.

Speaker Change: Basically we increased prices.

Omar: Mid 2024, so we're seeing people review.

Omar: Basically coming up and basically from May forward. So I think we'll start to see these retention rates going forward in the next quarter and even beyond.

Omar: Got it and.

Speaker Change: I guess.

Speaker Change: Final question here, and then I'll pass it on.

David Neil Lebowitz: Got it. And I guess a final question here and then I'll pass it on. How's the rollout of Total Health going at this point? The rollout of Total Health is one we haven't disclosed details on, but I think the thing to look for is that it's not just a one-size-fits-all approach.

Speaker Change: How is the rollout the total health going at this point.

Unknown Speaker: The rollout of Total Health is one we haven't disclosed details on, but I think the thing to look for is really when we launch this to existing customers, which we will launch sort of in that third quarter time frame.

Speaker Change: The rollout on total health and it's one we havent disclose details on but I think the thing to look for is really about when we launched this to existing customers, which we.

Speaker Change: Launch.

Speaker Change: And that third quarter timeframe.

Speaker Change: Got it. Thank you very much for taking my question.

Speaker Change: I should be clear about.

Speaker Change: Excellent. Thank you.

Speaker Change: Thank you.

Operator: Our next question will come from the line of Steven Mah with TD Cowan.

Speaker Change: Our next question will come from the line of Steven Mah with TD Cowen.

Poon Mah: Great. Thanks for taking the questions. Maybe a follow-up question on Total Health. The launch to existing customers, you said it's going to be in the third quarter. You're talking about the calendar year quarter, right? Yes, I was talking about the calendar year. Yeah, and then maybe can you outline what still needs to be done before you roll out to existing customers? I'm just kind of curious.

Speaker Change: Yeah.

Speaker Change: Great. Thanks for taking the questions.

Speaker Change: Maybe a follow up question on total health.

Speaker Change: The launch of listing customers.

Poon Mah: Going to be in the third quarter, you're talking about calendar year quarter right.

Speaker Change: Yes, sorry, I was talking about calendar year.

Speaker Change: Yeah and then.

Speaker Change: Maybe can you outline what still needs to be done before you you rollout to existing customers.

Unknown Speaker: I think before you had disclosed it, it was going to be rolled out to existing customers in spring. Yeah, it

Speaker Change: And just kind of curious.

I think before you had disclosed it was going to be rolled out to existing customers in spring.

Speaker Change: Yes, it's really it's an engineering issue is just about buildup building it out and enabling that upgrade path. So we just had our hands full with with other priority and so it will be prioritized.

Unknown Attendee: Unknown Attendee, Poon Mah, Gaurav Goparaju, Joseph Selsavage, Katie Watson, Joseph Arron

Speaker Change: Starting now through summer with that kind of window with the rollout to <unk> customers and third quarter.

Poon Mah: Okay, thanks for that. And last one for me, you know, I, you know, appreciate your comments around managing the cash burn. But how should we think about the cash burn going forward, especially when, you know, you're funding, you know, the high-value therapeutics business? Just, I mean, just how should we think about those two things, given that funding clinical trials is, you know, somewhat costly?

Speaker Change: Okay. Thanks for that last.

Speaker Change: Last one for me.

Speaker Change: I appreciate your comments.

Speaker Change: Around managing the cash burn, but how should we think about the cash burn going forward, especially when you are funding the high value therapeutics business.

Speaker Change: I mean, just how should we think about.

Speaker Change: Those two things given the.

Speaker Change: Funding clinical trials is somewhat costly.

Speaker Change: Thank you.

Unknown Speaker: Thank you. Sure. So, you know, as

Unknown Speaker: Sure. So, you know, as I've mentioned, we've continued to reduce expenses in our consumer and research segment through reductions in force and better cost management, which we announced last year, and we're committed to funding, you know, B610 funding the Phase 2a portion of the study and for 1473, the Phase 1 portion of the clinical trial. Now, for us, it is really having cost discipline in the company and really making sure that we reduce our cash burn and extend our cash runway to the extent possible.

Speaker Change: Sure so.

Speaker Change: As mentioned, we continue to reduce expenses in our consumer and research segment.

Speaker Change: Reductions in force and better cost management, which we announced last year.

Speaker Change: And we're committed to an <unk> <unk> to <unk>.

Speaker Change: Funding the phase Iia portion of the study and for $14 73 to be phase one.

Speaker Change: Some of the clinical trial.

Speaker Change: For us it is really having a cost discipline in the company and really making sure that we reduce our cash burn and extend our cash runway to the extent possible.

Speaker Change: Okay. Thank you.

Speaker Change: Okay.

Ian Cooney: Thank you. Now, I'll turn it over to Ian for any further questions.

Ian: Thank you now I'll turn it over to Ian for any further questions.

Ian Cooney: Yeah, thank you, Liz. I'll read a few of the top shareholder questions from our Say Technologies Q&A platform. I would just like to acknowledge that the top-voted question was whether the company would be going private, and as Joe mentioned at the beginning of the call, we can't comment any further beyond what we've already said. So I just wanted to acknowledge that, but we don't have any further comment. The next question would be for Anne, are there any plans to team up further with pharmaceutical companies to utilize the data you've collected to create any products or use the data in any other way to create value?

Ian: Yes, Thank you Lynn I'll read it here the top shareholder questions from our AI technology.

Speaker Change: Q&A platform.

Ian: I would just like to acknowledge the deep top voted question was will the company be going private and as Joe mentioned at the beginning of the call. We cant comment any further beyond what we've already said.

Ian: So I just wanted to acknowledge that but we don't have any further comment.

Next question would be for and are there.

Speaker Change: Any plans to team up further with pharmaceutical companies.

Speaker Change: To utilize the data you've collected to treat or to create any.

Speaker Change: Products or user data and any other ways to create value.

Anne Wojcicki: Absolutely, that is definitely a priority for the company to do partnerships with the therapeutics development industry to make sure that we're leveraging this data to help accelerate the development of therapeutic discoveries and development. So you should definitely see us continue to engage in those conversations. We'll hope to have deals. We have been, you know, sort of understanding and analyzing what is the best use for us to do these types of partnerships.

Speaker Change: Absolutely that is definitely a priority for the company to do partnerships with the therapeutics development industry to make sure that we're leveraging this data to help accelerate the development.

Speaker Change: Peter Gold discoveries and development.

So you should definitely see we will continue to engage in those conversations will hope to have deals.

Anne Wojcicki: I just want to also highlight that it's definitely been an environment where the entire industry has been cutting costs, but we are quite happy with the interest that we've had, and we're optimistic about the ability for us to do deals.

Speaker Change: We have been.

Sort of.

Speaker Change: Understanding and analyzing what is that best use for us to do these types of partnerships I just want to also highlight it's definitely been an environment, where the entire industry has been cutting costs.

Speaker Change: We are quite happy with the interest that we've had and are optimistic about the ability to do deals.

Ian Cooney: Great, another one for Anne, kind of more of a general one, what are the things that investors can look towards that are sort of the most exciting about the future of where the company is going?

Speaker Change: Great another one for Ann.

Speaker Change: Kind of more of a general one.

Speaker Change: What are the things that investors can look for.

Speaker Change: It better sort of the most exciting about.

Speaker Change: In the future where the company's goal.

Anne Wojcicki: Great question. So, three areas that I think that people should really be thinking about. One, this opportunity for us to be integrating Lemonade and really develop that consumer-focused wellness prevention service that is founded on your genomics is really exciting. And this is an opportunity for people to learn about their genomes, get blood, get access to advisors, you know, healthcare professionals who are trained in genomics, to look at all the various data sources and understand what they can do to be as healthy as possible.

Great question at three three areas I think that people should really be thinking about one this opportunity for us to be integrating lemonade and really develop that consumer focused wellness prevention service that is founded on your genomics.

Speaker Change: Really exciting and this is an opportunity for people to learn about their genome get blood get access to.

Speaker Change: Advisors health care professionals, who are trained on genomics to look at all the various data sources and understand what are the things. They can do to be as healthy as possible I think we've seen a real enthusiasm in the wellness space in general and I think that we have this opportunity to create a really affordable.

Anne Wojcicki: I think we've seen real enthusiasm in the wellness space in general, and I think that we have this opportunity to create a really affordable, impactful service for customers. Total Health is a fabulous product. I encourage everybody to try it if they have not already.

Speaker Change: <unk> full service for our customers total health.

Anne Wojcicki: It really gives you access to the 23andMe premium service plus the entire exome plus access to blood care providers. It really, I think, shows you sort of the future of where healthcare can go. Second, obviously, we've talked about the database and the opportunities with the database. It's an exciting world right now, too, because it's the world of LLMs and the opportunity for us to leverage all this data in LLM models. It's really the first time that we've seen these tools are able to manage the amount of data that we have.

Speaker Change: Fabulous product I encourage everybody to try and if you have not it.

Speaker Change: Really gain access to the 23 remain premium plus the entire exome plus access to blood care providers it really.

Speaker Change: I think shows you certainly the future of where healthcare pingo <unk>.

Speaker Change: Second obviously, we've talked about the database and the opportunities with the database.

Speaker Change: It is an exciting world right now also because of the world of <unk> and the opportunity for us to leverage all this data.

Speaker Change: In our model is really the first time, where we've seen E tools are able to manage the amount of data that we have that we see a lot of opportunity there both on the therapeutic side as well as on the consumer side and last obviously most importantly.

Anne Wojcicki: So we see a lot of opportunity there, both on the therapeutic side as well as on the consumer side. And last, obviously, most importantly, not most importantly, but one of our favorites is therapeutics with our therapeutic program. And it is a real privilege for us to be able to develop therapeutics and impact lives the way we are. So I am excited to see the data that comes out at ASCO. I look forward to more data that's going to come out after. But developing therapies from all of this data and really impacting human lives is incredibly exciting for us.

Speaker Change: But one of our favorite therapeutics.

Speaker Change: With our therapeutic program and it is a real privilege for us to be able to develop therapeutics and E impacting lives. The way. We are so I am excited to see the data that comes out at <unk> and look forward to more data that's going to come out after but developing therapies.

Speaker Change: From all of this data and really impacting human lives is.

Speaker Change: It's incredibly exciting for us.

Ian Cooney: Thank you. The next one's for Joe. Now that you've received the 180-day extension from NASDAQ, what are your plans to comply with the listening requirements?

Speaker Change #100: Thank you next one is for Joe.

Speaker Change: Now that you've received 180 day extension from NASDAQ what are the plans to comply with the service there.

Joseph Selsavage: We're pretty much focused on improving the stock price organically through, you know, continued execution and operating momentum. And we also mentioned that we would consider a reverse stock split under the right circumstances later in the year if we weren't able to get the stock price over a dollar per share, although noting that, you know, any reverse stock split would require board and shareholder approval.

Speaker Change: We're pretty much.

Joseph Selsavage: Focus on improving the stock price organically through continued execution and operating momentum and we also mentioned that we would consider a reverse stock split under the right circumstances later in the year, if we werent able to get the stock price over $1 per share.

Ian Cooney: Great, thank you. Last one.

Joseph Selsavage: Noting that any reverse stock split would require board and shareholder approval.

Ian Cooney: Anne, what are the plans beyond, or maybe you can just reiterate a little bit what plans there are to leverage our data with artificial intelligence models? Yeah, I think it's a little bit of what I talked about before.

Speaker Change #101: Great. Thank you last one and what are the what plans beyond or maybe you can just reiterate a little bit.

Speaker Change #102: Our plans are to leverage.

Speaker Change #102: Our data with artificial intelligence model.

Anne Wojcicki: Yeah, I think it's a little bit of what I talked about before. I think that there's a really exciting opportunity for building out models and risk prediction. And by understanding, by collecting all this data, understanding it all, looking at events, helping consumers understand what their risks are, and predicting what that next Unknown Attendee, Poon Mah, Gaurav Goparaju, Joseph Selsavage, Katie Watson, Joseph Arron, Thanks for joining us. This concludes today's conference call. Thank you for participating. You may now disconnect. Everyone, have a great day.

Speaker Change #103: Yeah, I think it's a little bit of what I talked about before I think that there is a really exciting opportunity for building out models and risk prediction.

Speaker Change #103: And by understanding by collecting all this data understanding at all.

Speaker Change #103: Looking at events, helping consumers.

Speaker Change #103: I understand what their risks are and predicting what that next.

Speaker Change #104: Risk event is for them is one really exciting opportunity and volatile therapeutics is helping pick what.

Speaker Change #104: What is the right target towers, the right way to develop a drug.

Speaker Change #104: Knowing that you can convert all of this data into either a consumer application or a therapeutics applications and very exciting for us and those are the types of partnerships that we are focused on.

Speaker Change #104: Okay.

Speaker Change #105: Thanks for joining us.

Operator: This concludes today's conference call. Thank you for participating. You may now disconnect. Everyone have a great day.

We encourage you to review the section entitled Forward-Looking Statements in our press release, which applies to this call. Also, please refer to our SEC filings, which can be found on our website and the SEC's website, for a discussion of numerous factors that may impact our future performance. We also discussed certain non-GAAP measures. Important information on our use of these measures and reconciliation to U.S. GAAP may be found in our Earnings. Joining us on our call today are Anne Wojcicki, our Chief Executive Officer and Co-Founder, and Joseph Selsavage, our Chief Financial and Accounting Officer. Jennifer Low, our Head of Therapeutic Development, will join us for Q&A. I'd now like to turn the call over to Joe. Thank you, Ian.

Speaker Change #106: This concludes today's conference call.

Thank you, Ian. Hello, everyone.

Speaker Change #107: Thank you for participating.

Speaker Change #108: You may now disconnect everyone have a great day.

Operator: ??? ??? ??? ??? ??? ??? 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 1922-1933 Unknown Attendee, Poon Mah, Gaurav Goparaju, Joseph Selsavage, Katie Watson, Joseph Arron, Jennifer Low, 23andMe, Hello, and welcome to 23andMe's fiscal year 2024 fourth quarter and full year financial results conference call. As a reminder, this call is being recorded.

Speaker Change #108: Okay.

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Operator: At this time, all participants are in a listen-only mode. After the prepared remarks, there will be a question and answer session. I would now like to turn the call over to Ian Cooney, Senior Director of Investor Relations at 23andMe, to lead off the call. Thank you.

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Thank you. Before we begin, I encourage everyone to go to investors.23andme.com to find the press release we issued earlier today reporting our financial results for the fourth quarter and full year. A replay of today's webcast will also be available on our website. Please note that certain statements made during this call regarding matters that are not historical facts, including but not limited to management's outlook or predictions for future periods, are forward-looking statements. These statements are based solely on information that is now available to us.

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I'd like to start by addressing the topic that is likely top of mind for everyone on this call. On March 28, 2024, the Board of Directors of 23andMe formed a special committee comprised of independent directors to review strategic alternatives that may be available to 23andMe to maximize shareholder value. On April 18, 2024, the company announced that it had become aware that Anne Wojcicki, Chief Executive Officer, Co-Founder, and Chair of the Board of Directors of 23andMe, was considering making a proposal to acquire all of the outstanding shares of 23andMe that she does not currently own, as she stated in an amendment dated April 17, 2024, to her Schedule 13D filing with the Securities and Exchange Commission.

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Ms. Wojcicki also indicated in her Schedule 13b filing that she wishes to maintain control of 23andMe and, therefore, will not be willing to support any alternative transactions. The Special Committee will carefully review Ms. Wojcicki's proposal, when and if it is made available, and evaluate it in light of other available strategic alternatives, including continuing to operate as a publicly traded company. The special committee is committed to acting in the best interests of 23andMe and its shareholders.

Speaker Change #108: As a reminder, this call is being recorded.

Speaker Change #109: At this time all participants are in a listen only mode. After.

Speaker Change #109: After the prepared remarks, there will be a question and answer session.

There can be no assurances that the foregoing will result in any particular outcome, and 23andMe does not intend to comment further on these matters until 23andMe determines that additional disclosure is appropriate or required by law. This call is focused solely on the company and its earnings relief, and we will not be addressing or responding to any questions regarding the aforementioned matters on this call. I'd now like to turn the call over to Anne.

Speaker Change #110: I would now like to turn the call over to Ian Cooney Senior director of Investor Relations at 23, and me to lead off the call. Thank you go ahead.

Fiscal 2024 was a productive yet transitional year at 23andMe, with the conclusion in July of the exclusive period of our Discovery and Development Collaboration Agreement with GFK.

Combined with a more constrained capital markets and fundraising environment, this necessitated a significant change in the strategic direction of the company. We refocused our business on our highest value programs and therapeutics and prioritize higher margin services and creating value for our membership programs and our consumer business. We also began to reimagine how to best leverage our data to create value for customers, partners, and shareholders. The result is an operating model that will look different in the coming years, but it's designed to reflect a company that remains committed to our vision of improving the health of millions of people worldwide.

As a first priority, we are focusing on driving profitable growth in high-return uses of cash. This means prioritizing memberships in our PGS segment, driving growth in telehealth, and leveraging our data assets to create a sustainably growing profitable research business. It also means that we are looking for ways to fund the continued development of our clinical assets while limiting the use of cash on our balance, starting with the PGS system.

Speaker Change #111: Thank you before we begin I encourage everyone to go to the investors that 23, <unk> dot com to find the press release issued earlier today reporting our financial results for the fourth quarter and full year. A replay of today's webcast will also be available on our website.

We are excited to announce that we have passed the 15 million customer milestone. This is a testament to the hard work of our employees and to the power and value of genetic information. We continue to innovate in both our ancestry and health offerings to drive growth and add value to our platform, specifically in our membership services. We have a compelling pipeline of premium features planned for our Ancestry platform and recently rolled out an exciting new feature called Historical Matches, enabling premium plus members to learn about their genetic connections to hundreds of interesting figures from history.

Speaker Change #111: Eliminating the use of cash on our balance sheet.

Speaker Change #111: Starting with the PGS business, we are excited to announce that we have passed the $15 million customer milestone. This.

Speaker Change #112: This is a testament to the hard work of our employees and to the power and value of genetic information.

Speaker Change #112: We continue to innovate in both our ancestry and health offerings to drive growth and add value to our platform specifically in our membership services.

We also added a number of new regions to bring our industry-leading total to over 3000. In health, a major component of our vision is to build a scalable preventive health service. We think this is best achieved through driving membership growth on our platform as it enables us to help our customers improve their health and manage risk over time. The membership model also enables a scalable, sustainable business model that will allow us to create value for shareholders while reinvesting in innovation to continue to improve the value of our offerings for customers.

Speaker Change #112: We have a compelling pipeline of premium features planned for our ancillary platform and recently rolled out an exciting new feature called historical matches.

Speaker Change #112: Enabling premium plus members to learn about their genetic connections to hundreds of interesting figures from history.

We also added a number of new regions to bring our industry, leading total to over 3000.

And health a major component of our vision is to build a scalable preventive health service.

Speaker Change #112: We think this is best achieved through driving membership growth on our platform as it enables us to help our customers improve their health and manage risk over time.

We are focused on the delivery of ongoing health value and accountability to customers, and our product development for our consumer products is largely centered in this area. We started with the recent rollout of personalized health features like Health Action Plan and HealthTracks and have begun integrating telehealth into our offering with the rollout of Total Health. In Q4, we announced the availability of three new genetic reports for 23andMe plus members on breast, colorectal, and prostate cancer.

Speaker Change #112: The membership model also enables a scalable sustainable business model that will allow us to create value for shareholders, while reinvesting in innovation to continue to improve the value of our offerings for customers.

Speaker Change #112: We are focused on the delivery of ongoing health value and accountability to customers and our product development for our consumer products is largely centered in this area.

Speaker Change #112: We started with the recent rollout of personalized health features like health action plan and health tracks and have begun integrating telehealth into our offering with the rollout of telehealth.

The reports are based on statistical models known as polygenic risk scores, developed by 23andMe through our proprietary research database. Our new cancer PRS reports identify individuals with a higher likelihood of developing three of the most common cancers, the majority of whom are invisible to the health care system today. Those individuals are then matched to the appropriate next steps through health action plans.

Speaker Change #112: In Q4, we announced the availability of three new genetic reports for 23 million plus members on breast colorectal and prostate cancer.

Speaker Change #112: The reports are based on statistical models now known as polygenic risk scores.

Speaker Change #112: Developed by <unk> 23, and me through our proprietary research database.

By empowering more people with this knowledge, we can help make cancer screening, prevention, early detection, and treatment more effective. We continue to work to make the membership platform even more engaging and useful for customers in tracking and impacting their personalized health journeys. And I am pleased to report that our retention rates in Q4 improved from the previous three quarters, while membership revenue grew by 41% year over year to $20 million. We are also prioritizing growth in our Lemonade Telehealth business and have begun to make meaningful strides while investing in a pipeline of future value drivers. Over the past few quarters, the telehealth business has generated positive gross margins while decreasing advertising spend at the same time, leading to improvements in our bottom line. And we expect this trend to continue.

Speaker Change #112: Our new cancer Prs reports identify individuals with a higher likelihood of developing three of the most common cancers. The majority of whom are invisible to the health care system today.

Speaker Change #112: Those individuals are then matched to the appropriate next steps through health accident plans.

Speaker Change #112: By empowering more people with this knowledge, we can help make cancer screening prevention early detection and treatment more effective.

Speaker Change #112: We continue to work to make the membership platform, even more engaging and useful for customers in tracking and impacting their personalized health journey and I am pleased to report that our retention rates in Q4 improved from the previous three quarters, while membership revenue grew by 41% year over year to $20 million.

Speaker Change #112: We are also prioritizing growth in our laminate telehealth business and have begun to make meaningful strides while investing in our pipeline of future value drivers.

In Q4, we launched over-the-counter options and quarterly plans, which are contributing to a meaningfully improved LTV. We also just announced the launch of one of the industry's leading fast-acting ED medications, Instendra, and expect a further addition to our offerings in the coming year. Overall, I'm very optimistic about the future of our consumer business. I believe we have only scratched the surface in delivering value and engaging with customers on their health journey. Moving to the research business

Speaker Change #112: Over the past few quarters. The telehealth business has generated positive gross margins, while decreasing advertising spend at the same time, leading to improvements in our bottom line.

Speaker Change #112: And we expect this trend to continue.

Speaker Change #112: In Q4, we launched over the counter options and quarterly plans, which are confirming to a meaningfully improved LTV.

Speaker Change #112: We also just announced the launch of one of the industry's leading fast acting EDI medications and stern drive and expect to further add to our offerings in the coming year.

Fiscal 2024 was the year of transition and learning for research. We were very pleased to announce GSK extended our agreement on a non-exclusive basis in October, showing the ongoing value in drug discovery and development of engaging with the world's largest reconstructible DNA data engine. I'm extremely encouraged by the potential for this business and by the interest shown by potential partners throughout the drug discovery and development ecosystem, and believe research will be a strong source of growth, profitability, and innovation as market conditions improve. On the innovation front, we are excited by recent advances in deep learning that will eventually enable us to train DNA language models to study the grammar of the genome.

Speaker Change #112: Overall, I am very optimistic about the future of our consumer business I believe we have only scratched the surface in delivering value and engaging with customers on their health journey.

Speaker Change #112: Moving to the research business fiscal 2024 was a year of transition and learning for research. We were very pleased to announce GSK extended our agreement on a nonexclusive basis in October showing the ongoing value and drug discovery and development of engaging with the world's largest re contracted bolt DNA data engine.

Speaker Change #112: Extremely encouraged by the potential for this business and by the interest shown by potential partners throughout the drug discovery and development ecosystem and.

We expect these methods to rapidly grow our ability to predict disease and provide compelling personalized health recommendations for customers. Using our database and AI, we are building features with the goal of becoming the world's best at genetic health risk prediction to help customers understand the impact of their lifestyle on disease prevention. 23andMe is actively developing AI models to enhance both its consumer and data partnership business. In the short term, the company is utilizing existing large language models to potentially expand support for clinicians.

Speaker Change #112: And believe research will be a strong source of growth profitability and innovation as market conditions improve.

Speaker Change #112: On the innovation front, we are excited by recent advances in deep learning that will eventually enable us to train DNA language models to study the grammar of the genome.

Speaker Change #112: We expect these methods to rapidly grow our ability to predict disease and provide compelling personalized health recommendations for customers.

Speaker Change #112: Using our database in AI. We are building features with the goal of becoming the worlds best of genetic health risk prediction to help customers understand the impact of their lifestyle and disease prevention.

In the future, 23andMe hopes to launch various AI models aimed at improving services for both customers and biotech partners. In the consumer space, this includes new predictive models for delivering personalized health recommendations more effectively. For biotech use cases, we are developing AI models that better predict the impact of genetic variation on cellular function.

Speaker Change #113: 23, <unk> is actively developing AI models to enhance both its consumer and data partnership businesses.

Speaker Change #113: In the short term the company is utilizing existing large language model to potentially expand support for clinics clinicians.

Speaker Change #113: And the future 23, and me hopes to launch various AI models aimed at improving services for both customers and biotech partners.

These initiatives utilize the company's unique database to accelerate target discovery and improve the probability of success in the drug discovery business. With recent breakthroughs in AI, we believe we are well placed to enable customers to explore potential health outcomes, understand how their lifestyle choices impact disease prevention, and surface new therapeutic opportunities for our partners. Moving to the therapeutics business, we made significant progress in fiscal 2024.

Speaker Change #113: In the consumer space. This includes new predictive models for delivering personalized health recommendations more effectively.

Speaker Change #113: For biotech use cases, we are developing AI models that better predict the impact of genetic variation on cellular function.

Speaker Change #113: These initiatives utilize the company's unique database to accelerate target discovery and improve the probability of success in the drug discovery business.

Speaker Change #113: With recent breakthroughs in AI, we believe we are well placed to enable customers to explore potential health outcomes.

We are pleased to announce we've completed enrollment in the Phase 2a study for 23andMe 610 and also recently announced we've moved our second immuno-oncology asset, 23andMe 1473, into the clinic and begun dosing patients in Phase 1. For 6.10, we will be presenting safety, efficacy, and biomarker data from two of our phase two cohorts at ASCO on June 1st and June 3rd We expect to present additional data from the 610 Phase 2a at additional upcoming medical meetings and data from the 1473 phase one in calendar year 2025.

Speaker Change #113: Understand how their lifestyle choices impact disease prevention.

Speaker Change #114: Surface, new therapeutic opportunities for our partners.

Speaker Change #113: Moving to the therapeutics business, we made significant progress in fiscal 2024, we.

Speaker Change #115: We are pleased to announce we've completed enrollment in the phase Iia study for 'twenty three and the 610 and also recently announced we've moved our second immuno oncology asset 23, and me $14 73 into the clinic and begun dosing patients in phase one.

Speaker Change #118: For <unk>, we will be presenting safety efficacy and biomarker data from two of our phase II cohorts at <unk> on June one and June 3rd.

As I look toward the future, I'm excited about the opportunities for 23andMe to grow and impact our customers. We are a leader in genetic and database health, and we continue to innovate and lead. The interest in data and AI, combined with our world-leading genetic and phenotypic data engine, portend amazing opportunities for our research business. And in therapeutics, we are incredibly excited by the potential of our clinical assets and the future value they may bring to patients and to the company. And with that, I'll turn the call over to Joe to review our financial results for the quarter.

Speaker Change #116: We expect to present additional data from the 610 phase Iia at additional upcoming medical meetings and data from the $14 73 phase one in calendar year 2025.

Speaker Change #119: As I look towards the future I am excited about the opportunities for 'twenty, three aiming to grow and impact our customers.

Speaker Change #116: We are a leader in genetic and Databased health and we continue to innovate and lead the.

Speaker Change #117: The interest in data and AI combined with our world, leading genetic and phenotypic data engine portend amazing opportunities for our research business and in Therapeutics. We are incredibly excited by the potential of our clinical assets and future value. They may bring to patients and to the company.

Thank you, Anne. I'd like to reiterate Anne's excitement about the future of precision healthcare at 23andMe, and I'm proud of our ability to execute while maintaining cross-discipline amid our shift toward a more sustainable operating profile. Revenue for the quarter ended the year with $64 million and $220 million, respectively, representing a 31% decrease and a 27% decrease, respectively, over the same periods in the prior year. Similar to the last few quarters, the year-over-year decrease in revenue was primarily due to the conclusion of the exclusive discovery term under our GSK collaboration in July, as well as lower consumer services revenue in our PGS kit and telehealth business.

Speaker Change #117: And with that I will turn the call over to Joe to review, our financial results for the quarter.

Joseph Selsavage: Thank you and I'd like to reiterate and excitement about the future of precision health care, <unk> and I'm proud of our ability to execute while maintaining cost discipline.

Joseph Selsavage: For a more sustainable operating profile.

Joseph Selsavage: Revenue for the quarter ended the year with $64 million and 220 billion, respectively, representing a 31% decrease and a 27% decrease respectively over the same periods in the prior year.

The decrease in consumer revenue was driven by our focus on marketing efficiency and membership sales, both of which have resulted in improved unit economics and customer lifetime value but lower sales across the consumer offering. We expect that these decisions will continue providing benefits to our margins over the short and longer term.

Speaker Change #120: Similar to the last few quarters the year over year decrease in revenue was primarily due to the inclusion of exclusive discovery term under our GSK collaboration in July as well as lower consumer services revenue and our PGS kit and telehealth businesses.

Speaker Change #121: The decrease in consumer revenue was driven by our focus on marketing efficiency and membership sales both of which have resulted in improved unit economics and customer lifetime value, but lower sales across the consumer offerings.

These decreases were partially offset by continued growth in our subscription service. Looking at the composition of our revenue, Consumer Services revenue represented 99% and 92% of total revenue for the quarter and the year, respectively. And Research Services revenue, which was primarily derived from our other research partners, accounted for approximately 1% and 8% of total revenue, respectively, for those same periods.

Speaker Change #121: We expect that these decisions will continue providing benefits to our margins over the short and longer term.

Speaker Change #121: These decreases were partially offset by continued growth in our subscription services.

Speaker Change #121: Looking at the composition of our revenue consumer services revenue represented 99% and 92% of total revenue for the quarter and the year, respectively and research services revenue, which was primarily derived from our other research partners accounted for approximately 1% and 8%.

As a reminder, the new GSK data license announced in Q3 is expected to have minimal impact on this year's results, with the majority landing in fiscal year 25, given the terms of the agreement. Her gross profit for the fourth quarter and the year was $27,099,000,000,000, respectively, representing a 32% decrease and 26% decrease, respectively, over the same periods in the prior year. The decreases were driven primarily by the decrease in research services revenue, while subscription revenue, higher ASPs on our PGS kits, and improved telehealth margins following the August 23 disposition of Lemonade Health Limited in the UK.

Speaker Change #121: Total revenue respectively for those same periods.

Speaker Change #122: As a reminder, the new GSK data license announced in Q3 is expected to have minimal impact from this year's results with the majority of landing in fiscal year 'twenty five given the terms of the agreement.

Speaker Change #122: Our gross profit for the fourth quarter, and the year was $27 million and $99 million, respectively, representing a 32% decrease and 26% decrease respectively over the same periods in the prior year.

Turning to our expenses, total operating expenses for the quarter and the year were $239 million and $781 million, respectively, compared to $109 million and $459 million for the same period in the prior year. The increase in operating expenses for the quarter and the year was primarily due to $153 million and $352 million, and non-cash goodwill impairment charges taken for the quarter and the year, respectively, and was partially offset by lower personnel-related expenses following workforce reductions in the prior quarters and the disposition of the UK MTA. Along with lower therapeutics related R&D spend due to a significant reduction in the GSK collaboration program.

Speaker Change #123: The decreases were driven primarily by the decrease in research services revenue, while subscription revenue higher asps on our PGS kit and improved margins. Following the August 23 disposition or eliminate limited in the UK.

Speaker Change #123: Turning to our expenses total operating expenses for the quarter and the year with $239 million and $781 million respectively.

Speaker Change #123: Parents $109 million and $459 million for the same periods in the prior year.

Speaker Change #124: The increase in operating expenses for the quarter and the year was primarily due to $153 million and $352 million.

Speaker Change #125: In noncash goodwill impairment charges taken quarter and the year respectively.

And was partially offset by lower personnel related expenses following workforce reductions in the prior quarters and the disposition of a U K entity.

Looking at the bottom line, net loss for the quarter and the year was $209,667,000,000, respectively, compared to net losses for the same period in the prior year of $64,312,000,000. The increase in fourth quarter and full year net loss was driven mainly by the goodwill impairment charge mentioned previously. I would also like to point out that the full-year fiscal 24 results are preliminary. We are still completing our assessment of our impairment review of goodwill and long-lived assets, and our impairment expenses are undergoing further evaluation. This could result in an adjustment to the impairment recorded in our operating expenses and impact our net loss.

Speaker Change #126: Along with lower therapeutics related R&D spend due to a significant reduction.

Speaker Change #126: And the GSK collaboration programs.

Speaker Change #126: Looking at the bottom line net loss for the quarter and the year were $209 million and 667 million, respectively compared to net losses for the same periods in the prior year of $64 million and $112 million.

Speaker Change #127: The increase in fourth quarter and full year net loss was driven mainly by the goodwill impairment charge mentioned previously.

Speaker Change #128: I would also like to point out that the full year fiscal 2004 results are preliminary we are still completing our assessment of our impairment review of goodwill and long lived assets and.

However, it is important to point out that any adjustment would be a non-cash item and reflected in our annual report on Form 10-K for the year ended March 31st, 2025. Next, our adjusted EBITDA. For details on how we define and adjust EBITDA, as well as the corresponding reconciliations to GAP, please see our earnings report. The total adjusted EBITDA deficit for the fourth quarter was $33 million, compared to a $39 million deficit for the same period in the prior year. The total adjusted EBITDA deficit for the year was $176 million, compared to a $161 million deficit for the same period in the prior year.

Speaker Change #129: And our impairment expenses undergoing further evaluation.

Speaker Change #129: This could result in an adjustment to the impairment recorded in our operating expenses and impact our net loss.

Speaker Change #129: However, it is important to point out that any adjustment would be a non cash item and reflected in our annual report on Form 10-K for the year ended March 31 2024.

Speaker Change #129: Our adjusted EBITDA.

Speaker Change #130: For details on how we define adjusted EBITDA as well as the corresponding reconciliations to GAAP. Please see our earnings release.

Speaker Change #130: Total adjusted EBIT, a deficit for the fourth quarter was $33 million compared to $39 million deficit for the same period in the prior year.

Despite the decline in revenue, we made meaningful progress in managing our expenses, and we ended the year with $216 million in cash and cash equivalents, compared to $387 million as of March 31, 2020. We continue to be judicious with our cash usage and believe that the current level of cash supports 23andMe's plans for targeted investment and high ROI growth initiatives. We also announced on May 9th that the company received a notification letter from NASDAQ notifying the company that it had to be granted an additional 180 days, or until November 4th, 2024, to regain compliance with the minimum bid requirements for continued listing on the NASDAQ capital market.

Speaker Change #130: Total adjusted EBIT net deficit for the year was $176 million compared to a $161 million deficit.

Speaker Change #130: Same period in the prior year.

Speaker Change #131: Despite the decline in revenue, we made meaningful progress in managing our expenses.

Speaker Change #131: And we ended the year with $216 million in cash and cash equivalents compared to $387 million as of March 31 2023.

Speaker Change #132: We continue to be judicious with our cash usage and believes that the current level of cash support 20, <unk> plan for targeted investments.

Speaker Change #132: Roy growth initiatives.

Speaker Change #132: We also announced on May nine the company received a notification letter from NASDAQ notifying the company that have been granted an additional 180 days or until November four two.

Certainly, guidance. In light of the previously mentioned special committee review of strategic alternatives, the company is not providing financial guidance at this time. Wrapping up, we are pleased with the company's strategic progress and are looking forward to an exciting year ahead. We remain focused on realizing our vision while maintaining operating discipline and a focus on higher return investments. I am incredibly optimistic about the future of the company and our ability to help people access, understand, and benefit from the human genome.

Speaker Change #132: 2020 for them to regain compliance with the minimum bid requirement for continued listing on.

NASDAQ capital market.

Speaker Change #132: Turning to guidance.

Speaker Change #132: In light of the previously mentioned Special Committee review of strategic alternatives.

Speaker Change #132: He is not providing financial guidance at this time.

Speaker Change #132: Wrapping up we are pleased with the company's strategic progress and are looking forward. Its been exciting year ahead, we remain focused on realizing our vision, while maintaining operating discipline and a focus on high return investments I'm incredibly optimistic about the future of the company and our ability to help people access understand.

To ask a question, please press star 1 1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1 1 again. Our first question will come from the line David Lebowitz with Citi. Thank you.

Benefits from the human genome.

Speaker Change #133: With that let's open it up to questions.

Speaker Change #134: To ask a question. Please press star one one on your telephone and wait for your name to be announced to withdraw your question. Please press star one again.

Thank you very much for taking my question. Would you be able to help frame expectations for the phase two update that's coming to ASCO?

Speaker Change #135: Our first question will come from the line of David Leibowitz with Citi.

Yeah, we're excited to be able to present the first efficacy, safety, and biomarker data on two of our cohorts, the neuroendocrine and ovarian cohorts, which enrolled more quickly last year. But that data is embargoed until the presentation of the abstracts, just before the study starts, but just before the conference starts. But we have released the titles and the time, and we will present the posters on our investor website and the therapeutics website when they become available on the day of presentation.

David Neil Lebowitz: Thank you very much for taking my question would you be able to help frame expectations.

Speaker Change #136: Phase two update.

Speaker Change #136: Oscar.

Speaker Change #136: Yes, let me hand, it over to Jennifer.

Speaker Change #136: Yes.

Jennifer: But it should be able to present, the first efficacy safety and biomarker data on two of our cohorts.

Euro endocrine and ovarian cohorts, which enrolled more quickly last year.

Speaker Change #137: That data is embargoed until the.

Speaker Change #137: Presentation of the abstracts, just before the study start.

Speaker Change #137: Just before the conference started but.

Thank you for that. And in terms of product, Nick. At present and going forward, what do you see as the biggest drivers of margin expansion as the year progresses?

Speaker Change #137: So we.

Speaker Change #137: We have holdings the titles and decline and we will present, the posters on our investor website, and the therapeutics website when they become available on the data presentation.

Unknown Speaker Sure. You know, for us, it is really focused on membership revenue. You know, we've really seen improvements in our subscription revenue this year, as we increased the price from $29 to $69. And I know on our 23andMe plus memberships, we've continued to see great retention rates. And, you know, and people really love it, and we're continuing to add value to that subscription as well. So that recurring revenue will help us with a high-margin dollar added to our bottom line. At what point do you think you'll have it?

Speaker Change #138: Thank you for that and in terms of product mix.

Speaker Change #139: At present and going forward.

Speaker Change #140: Do you see as the biggest drivers of margin expansion.

Speaker Change #140: The sheets.

Speaker Change #140: Sure.

Speaker Change #141: It isn't really focus on membership revenue.

Speaker Change #141: Really seen improvements in our subscription revenue this year.

Speaker Change #141: As we increase the price and $29 $69.

Speaker Change #141: On our <unk> plus memberships, we've continued to see great retention rates and and people really and we're continuing to add value in that subscription as well so that recurring revenue will help us and Thats high margin dollars.

At what point do you think you'll have a fair degree of, I guess, visibility on the extent that the customer base is proceeding post the price increase? Sorry, say again. Can you explain no more? I'm just asking at what point do you think you have a fair degree of visibility on retention of customers post the price increase?

Speaker Change #141: Bottom line.

Speaker Change #141: Yes.

Speaker Change #142: Do you think Youll have a fair degree I.

Speaker Change #143: And I guess visibility on.

Speaker Change #142: <unk>.

Speaker Change #142: The extent that the customer base.

Speaker Change #142: Proceeding.

Speaker Change #142: The price increases.

You know, basically, we increased prices in mid-2024. So we're seeing people who are new to this, you know, basically, coming up in, you know, basically from May forward. So I think we'll start to see these retention rates going forward into the next quarter and even beyond.

Speaker Change #144: Alright, Thanks, Ken can you explain Omar.

Speaker Change #145: I'm just asking about it.

Ken: What point do you think Youll have a fair degree of visibility on retention.

Speaker Change #147: The customers post price increases.

Speaker Change #148: Basically we increased prices.

Got it. And I guess my final question here and then I'll pass it on. How's the rollout of Total Health going at this point? The rollout of Total Health is one we haven't disclosed details on, but I think the thing to...

Mid 2024, so we're seeing people weren't you.

Speaker Change #148: Basically coming up and basically from May forward. So I think we will start to see these retention rates going forward into the next quarter and beyond.

The rollout of Total Health is one we haven't disclosed details on, but I think the thing to look for is really when we launch this to existing customers, which we will launch sort of, you know, in that third quarter timeframe.

Speaker Change #149: Got it and.

Speaker Change #150: I guess.

Speaker Change #151: Final question here, and then I'll pass it on.

Speaker Change #152: How is the rollout of total health going at this point.

Speaker Change #153: The rollout I'm total health.

Speaker Change #154: And when we Havent disclose details on but I think the Haynesville before is really about when we launched this to existing customers, which we will launch.

Speaker Change #153: <unk>.

Our next question will come from the line of Steven Mah with TD Cowan.

Speaker Change #155: And that third quarter timeframe.

Speaker Change #157: Got it. Thank you very much for taking my question.

Great. Thanks for taking the questions. Maybe a follow-up question on total health. The launch of this in customers, you said it's going to be in the third quarter. You're talking about the calendar year quarter, right? Yeah, so I was talking about the calendar year. Yeah, and then maybe can you outline what still needs to be done before you roll out to existing customers? I'm just kind of curious.

Speaker Change #156: I should be clear about.

Speaker Change #158: Excellent. Thank you.

Speaker Change #158: Thank you.

Speaker Change #159: Our next question will come from the line of Steven Mah with Gd Cowen.

Speaker Change #160: Great. Thanks for taking the questions.

Speaker Change #161: A follow up question on total health.

Speaker Change #162: The launch of existing customers.

I think before you had disclosed it, it was going to be rolled out to existing customers in spring. Yeah, it's really good

Speaker Change #162: In the third quarter, you talked about calendar year quarter right.

Speaker Change #163: Yes, I was talking about calendar year.

Speaker Change #164: Yeah and then.

about building it out and enabling that upgrade path. So we've just had our handful with other priorities. So it will be prioritized starting now through summer with the rollout to customers in the third quarter.

Speaker Change #165: Maybe can you outline what still needs to be done before you.

Rollout to existing customers.

Speaker Change #166: I'm just kind of curious.

Speaker Change #167: I think before you had disclosed it was going to be rolled out to existing customers in spring.

Speaker Change #168: Yes, it's really.

Speaker Change #169: Engineering issue is just about building building it out and enabling that upgrade path. So we've just had our hands full with with other priority and so it will be prioritized.

Okay, thanks for that. And last one for me, you know, I, you know, appreciate your comments around managing the cash burn. But how should we think about the cash burn going forward, especially when, you know, you're funding, you know, the high-value therapeutics business? Just, I mean, just how should we think about those two things, given that funding clinical trials is, you know, somewhat costly?

Speaker Change #169: Starting now through summer with that kind of window with the rollout and customers and third quarter.

Speaker Change #170: Okay. Thanks for that last.

Speaker Change #171: Last one for me.

Speaker Change #172: I appreciate your comments.

Speaker Change #173: Around managing the cash burn, but how should we think about the cash burn going forward, especially when you're funding under high value Therapeutics business.

Sure. As I mentioned, we've continued to reduce expenses in our consumer and research segment through reductions in force and better cost management, which we announced last year, and we're committed to funding the Phase 2a portion of the study and for 1473, the Phase 1 portion of the clinical trial. Now, for us, it is really having cost discipline in the company and really making sure that we reduce our cash burn and extend our cash runway to the extent possible.

Thank you. Sure. So, you know, as

I mean, just how should we think about.

Speaker Change #173: Those two things given.

Speaker Change #174: In clinical trials is somewhat costly.

Speaker Change #175: Thank you.

Speaker Change #176: Sure so.

Speaker Change #177: As mentioned, we continue to reduce expenses in our consumer and research segment.

Speaker Change #177: Reductions in force.

Speaker Change #177: Better cost management, which we announced last year.

Speaker Change #177: We're committed to mid <unk>.

Funding the phase Iia portion of the study.

Speaker Change #177: For <unk> 73 to be phase one.

Thank you. Now, I'll turn it over to Ian for any further questions.

Speaker Change #177: Some of the clinical trial.

Speaker Change #177: For us it is really having cost discipline in the company and really making sure that we reduce our cash burn and extend our cash runway to the extent possible.

Yeah, thank you, Liz. I'll read a few of the top shareholder questions from our Say Technologies Q&A platform. I would just like to acknowledge that the top-voted question was, will the company be going private? And as Joe mentioned at the beginning of the call, we can't comment any further beyond what we've already said. So I just wanted to acknowledge that, but we don't have any further comments. The next question would be for Anne: is there... Any plan to team up further with pharmaceutical companies to utilize the data you've collected to create any products or use the data in any other way to create value? Appu

Speaker Change #178: Okay. Thank you.

Speaker Change #178: Okay.

Speaker Change #179: Thank you now I'll turn it over to Ian for any further questions.

Ian Cooney: Yes, Thank you and I'll return to that Bob.

Bob: Bob shareholder questions from our technology.

Speaker Change #182: Q&A platform.

I would just like to acknowledge the top bonus question was will the company be going private and as Joe mentioned at the beginning of the call. We cant comment any further beyond what we've already said.

Speaker Change #182: I just wanted to acknowledge that we don't have any further comment.

Speaker Change #183: Next question would be for and are there any.

Absolutely, that is definitely a priority for the company to partner with the therapeutics development industry to make sure that we're leveraging this data to help accelerate the development of therapeutic discoveries and development. So, you should definitely see, we will continue to engage in those conversations. We'll hope to have deals. We have been, you know, sort of understanding and analyzing what is the best use for us to do these types of partnerships.

Speaker Change #183: Any plans to team up further with pharmaceutical companies.

Speaker Change #184: Utilize the data you've collected to treat or to create any.

Speaker Change #184: Products or user data in any other way integrated value.

Speaker Change #185: Absolutely that is definitely a priority for the company to do partnerships with the therapeutics development industry to make sure that we're leveraging this data to help accelerate the development.

I just want to also highlight that it's definitely been an environment where the entire industry has been cutting costs, but we are quite happy with the interest that we've had, and we're optimistic about the ability for us to do deals.

Peter: Peter called discoveries and development.

Peter: So you should definitely see we will continue to engage in those conversations will hope to have deal with.

Peter: Have been.

Peter: And sort of understanding and analyzing what is that best use for us to do these types of partnerships I just want to also highlight it's definitely been an environment where.

Great, another one for Anne, kind of more of a general one, what are the things that investors can look towards that are sort of the most exciting about the future of where the company is going?

Peter: Tire industry has been cutting costs.

Peter: But we are quite happy with the interest that we've had and are optimistic about the ability for us to do deals.

Great question. So, three areas that I think that people should really be thinking about. One, this opportunity for us to be integrating Lemonade and really develop that consumer-focused wellness prevention service that is founded on your genomics is really exciting. And this is an opportunity for people to learn about their genomes, get blood, get access to advisors, you know, healthcare professionals who are trained in genomics, to look at all the various data sources and understand what they can do to be as healthy as possible.

Speaker Change #187: Great another one for Ann.

Speaker Change #188: Kind of more of a general one.

Speaker Change #189: How what are the things that investors come up towards that are sort of the most exciting about.

Speaker Change #189: The future of where the company's goal.

Speaker Change #190: Great question three three areas I think that people should really be thinking about one this opportunity for us to be integrating lemonade and really develop that consumer focused wellness prevention service that is founded on your genomics is really exciting and this.

I think we've seen real enthusiasm in the wellness space in general, and I think that we have this opportunity to create a really affordable, impactful service for customers. Total Health is a fabulous product. I encourage everybody to try it.

As an opportunity for people to learn about their genome get blood get access to.

Speaker Change #190: Advisors health care professionals, who are trained on genomics to look at all the various data sources and understand what are the things. They can do to be as healthy as possible I think we've seen a real enthusiasm in the wellness space in general and I think that we have this opportunity to create a really affordable.

If you have not, it really gives you access to the 23andMe premium, plus the entire exome, plus access to blood and care providers. It really, I think, shows you sort of the future of where healthcare can go. Second, obviously, we've talked about the database and the opportunities with the database. It's an exciting world right now, also, because it's the world of LLMs and the opportunity for us to leverage all this data in LLM models.

Speaker Change #190: <unk> all service for our customers so it'll help.

Speaker Change #190: Fabulous product I encourage everybody to try it if you have not it.

Really gives you access to the 20th remain premium plus the entire exome plus access to blood care providers.

It's really the first time that we've seen these tools are able to manage the amount of data that we have. So we see a lot of opportunity there, both on the therapeutic side, as well as on the consumer side. And last, obviously, most importantly, not most importantly, but one of our favorites, is therapeutics with our therapeutic program. And it is a real privilege for us to be able to develop therapeutics and impact lives the way we are.

Speaker Change #190: I think shows you certainly the future of where healthcare pingo <unk>.

Speaker Change #191: Second obviously, we've talked about the database and the opportunities with the database.

Speaker Change #191: It is an exciting world right now also because of the world of <unk> and the opportunity for us to leverage all this data.

Speaker Change #191: In our model is really the first time, where we've seen E tools are able to manage the amount of data that we have so we see a lot of opportunity there both on the therapeutic side as well as on the consumer side and last obviously, most importantly, partly but one of our favorites and therapeutics.

So I am excited to see the data that comes out at ASCO. I look forward to more data that's going to come out after that. But developing therapies from all of this data and really impacting human lives is incredibly exciting for us.

With our therapeutic program and it is a real privilege for us to be able to develop therapeutics and be impacting lives. The way. We are so I am excited to see the data that comes out at <unk> and look forward to more data that's going to come out after that.

Thank you. The next one's for Joe. Now that you've received the 180-day extension from NASDAQ, what are the plans?

Speaker Change #191: Developing therapies from all of this data and really impacting human lives is.

We're pretty much focused on improving the stock price organically through, you know, continued execution and operating momentum. And we also mentioned that we would consider a reverse stock split under the right circumstances later in the year if we weren't able to get the stock price over $1 per share, noting that, you know, any reverse stock split would require board and shareholder approval.

Speaker Change #191: Credibly funding process.

Speaker Change #192: Thank you next one for Joe.

Speaker Change #193: Now that you've received 190 day extension from NASDAQ what are the plans to comply with.

Speaker Change #194: During the quarter.

Joseph Selsavage: We are pretty much focused on improving the stock price organically through.

Joseph Selsavage: <unk> execution and operating momentum and we also mentioned that we would consider a reverse stock split under the right circumstances later in the year, if we weren't able to.

Great, thank you. Last one, Anne, what are the plans beyond, or maybe you can just reiterate a little bit what plans there are to leverage our data with an artificial intelligence model? Yeah, I think it's a little bit of what I talked about before. I think that there's

Joseph Selsavage: Yet the stock price over $1 per share.

Joseph Selsavage: Noting that any reverse stock split would require board and shareholder approval.

Yeah, I think it's a little bit of what I talked about before. I think that there's a really exciting opportunity for building out models for risk prediction. And by understanding, by collecting all this data, understanding it all, looking at events, helping consumers understand what their risks are and predicting what the next Unknown Attendee, Poon Mah, Gaurav Goparaju, Joseph Selsavage, Katie Watson, Joseph Arron

Speaker Change #195: Great. Thank you last one and what are the what plans beyond or maybe you can just reiterate a little bit.

Speaker Change #195: Plans are to leverage.

Speaker Change #195: Our data with artificial intelligence model.

Speaker Change #196: Yes, I think it's a little bit of what I talked about before I think that there is a really exciting opportunity for building out models and risk prediction.

Speaker Change #197: And by understanding by collecting all this data understanding at all.

Speaker Change #197: Looking at our bank, helping consumers.

Speaker Change #197: I understand what their risks are and predicting what that next.

Speaker Change #198: This risk event is for them is one really exciting opportunity as well as in therapeutics is helping pick what.

Speaker Change #198: What is the right target Howard the right way to develop a drug.

Speaker Change #198: Knowing that you can convert all of this data into either a consumer application or a therapeutic applications and very exciting for us and those are the types of partnerships that we are focused on.

This concludes today's conference call. Thank you for participating. You may now disconnect. Everyone have a great day.

Speaker Change #198: Yeah.

Speaker Change #199: Thanks for joining us.

Speaker Change #200: This concludes today's conference call.

Speaker Change #201: Thank you for participating.

Speaker Change #202: You may now disconnect everyone have a great day.