Q2 2025 NeoGenomics Inc Earnings Call

Listen only mode.

After the speaker's presentation, there will be a question and answer session. Please be advised that today's conference is being recorded.

I will now turn the call over to Ken for Webster, Vice President of Investor Relations.

Thank you Tom and good morning, everyone welcome to the Neogenomics second quarter 2025 financial results call with me today to discuss the results are Tony Zook, Chief Executive Officer, and Jeff Sherman Chief Financial Office additional members of the management team will be available for the Q&A portion of our call.

This call is being simultaneously webcast and will be referring to the slide presentation that has been posted to the investors tab on our web site at IR Dot Neogenomics Dot com.

Thank you for holding. We look forward to talking with you soon. Please hold the line, and we'll be right back with you.

During this call we will make forward looking statements regarding our future performance business strategy and financial guidance.

Caution you that the actual events or results could differ materially from those expressed or implied by the forward looking statements.

These forward looking statements made during the call speak only as of the original date of this call and we undertake no obligation to update or revise any of these statements.

Please refer to the information disclosed under the heading risk factors in our most recent forms 10-K, 10-Q, and 8-K that we filed with the SEC to identify important risks and other factors that may cause our actual results to differ from the forward looking statements. These documents can be found in the investors section of our website.

Thanks for holding, we appreciate your time and patience. Please stay on the line and we'll be back in just a moment.

On the Sec's website.

During this call we refer to certain non-GAAP financial measures that involve adjustments to GAAP results.

The non-GAAP financial measures presented should not be considered an alternative to the financial measures required by GAAP should not be considered measures of liquidity and are unlikely to be comparable to non-GAAP financial measures provided by other companies.

Any non-GAAP financial measures referenced on this call are reconciled to the most directly comparable GAAP financial measures and a table available in the press release, we issued this morning and available in the investors section of our website.

Thank you for holding we sincerely. Appreciate your patience please. Stay on the line and we'll be back in a moment.

I'll now turn the call over to Tony.

Thanks Kendra good morning, everyone and thank you for joining us today.

Pleased to lead this call having now completed my first quarter as CEO.

Since becoming CEO in April and engage with the business, including sales operations and R&D.

Amador strategic initiatives and financial targets from a more in depth perspective, then I could as a director.

I've also met with existing and potential partners at various industry conferences.

Conversations with many of our shareholders to better understand their perspective.

Thank you for holding. We look forward to talking with you soon. Please hold the line, and we'll be right back with you.

These conversations reinforce this significant.

And opportunities to drive value for our customers patients and shareholders.

Cancer testing continues to be a large and attractive market.

Most of our business today is in diagnostic testing go recently, we have accelerated our offerings and therapy selection with the launch of several NGF products.

In addition, our radar one one technology and R&D working on next generation M. R&D enable us to participate in a market, that's underpenetrated and rapidly growing.

I acknowledge that our delivery this quarter was below expectations.

While I remain extremely optimistic about the future of Neogenomics, our team and I are doubling down on our efforts to focus the business on execution excellence as we build upon our disciplined financial and operational Foundation.

Thank you for holding. We look forward to talking with you soon, please?

Hold the line, and we'll be right back with you.

But before we talk about our plans moving forward, let's spend time on the quarter.

We had a solid second quarter in the core clinical business posting significant volume and share gains in key segments. However, our non clinical revenue was below expectations revenue for Q2 was $181 million slightly below our second quarter guidance range, though still representing double digit growth of 10% year over year.

Our clinical business continues to expand with organic growth of 13%.

Strength in our clinical business was offset by continued weakness in our non clinical revenue driven by lower revenue from pharma and biotech customers.

Thanks for holding, we appreciate your time and patience. Please stay on the line and we'll be back in just a moment.

In the second quarter, we saw a sequential improvement in <unk>.

A record quarter for test volumes and NGL growth of 23%.

Slightly below our 25% target well ahead of the low to mid teens and <unk> market growth rate.

We can continue to capture market share in clinical revenue, but we made a conscious decision to leverage the learnings from our pantries for liquid biopsy EAP to establish an even stronger product profile to launch.

Thanks for holding, we appreciate your time and patience. Please stay on the line and we'll be back in just a moment.

This meant we delayed our launch which resulted in lower revenue and a lower than targeted NGL growth rate.

I am excited to confirm that pinch rates or liquid biopsy will launch commercially tomorrow and believe that our approach to bring this product to market will positively impact patients treated in the community and our NGL growth rate later this year.

We're projecting lower than planned revenue from pharma customers for the remainder of the year as well as a negative impact to revenue associated with lower than planned volumes for pantry or liquid biopsy and NGL mix.

Operator: At this time, all participants are in listen-only mode.

As a result, we've updated our 2025 financial guidance, which Jeff will provide more insight on in a moment.

Operator: After the speaker's presentation, there will be a question and answer session. Please be advised that today's conference is being recorded.

I am confident that Nino can continue to achieve double digit annual growth fill product gaps through organic and inorganic activities and capture additional market share.

Paid in the market, it's under penetrated and rapidly growing.

Kendra Webster: I will now turn the call over to Kendra Webster, Vice President of Investor Relations. Thank you, Tom, and good morning, everyone. Welcome to the Neogenomics Second Quarter 2025 Financial Results Call. With me today to discuss the results are Tony Zook, Chief Executive Officer, and Jeff Sherman, Chief Financial Officer. Additional members of the management team will be available for the Q&A portion of our call. This call is being simultaneously webcast, and we will be referring to the slide presentation that has been posted to the Investors tab on our website at ir.neogenomics.com. During this call, we will make forward-looking statements regarding our future performance, business strategy, and financial guidance.

The leadership team and I are drill down to align our cost structure with revenues.

Establish our consistent execution and rebuild credibility with our shareholders.

I acknowledge that our delivery. This quarter was below expectations. While I remain extremely optimistic about the future of neogenomics, our team and I are doubling down on our efforts to focus the business on execution Excellence, as we build Upon Our discipline financial and operational foundations.

The investments, we're making in operating efficiencies this year, including the <unk> project and digital pathology position us well to achieve more operating leverage in the back half of this year.

But before we talk about our plans moving forward, let's spend time on the quarter.

We had a solid second quarter in the core clinical business, posting significant volume and shared gains in key segments,

I think it's important spent some time discussing our Q2 results and how we intend to accelerate growth and drive value.

The pharma macro environment conditions contributed to the revenue shortfall in the quarter versus our expectations.

However, our non-clinical revenue was below expectations. Revenue for Q2 was $181 million, slightly below our second quarter guidance range; though, it still represents double-digit growth of 10% year-over-year.

Specifically market uncertainty surrounding NIH funding drug pricing patient enrollment in clinical trials and potential tariffs are leading directly to investment volatility and created significant headwinds for both our pharmaceutical and biotech clients.

In clinical business continues to expand with Organic growth of 13%.

Kendra Webster: We caution you that the actual events or results could differ materially from those expressed or implied by the forward-looking statement. These forward-looking statements made during the call speak only as of the original date of this call, and we undertake no obligation to update or revise any of these statements.

Strength in our clinical business was offset by continued weakness. In our non-clinical Revenue driven by lower revenue from Pharma and biotech customers.

This is resulting in budget restrictions.

Prioritization and consolidation of assets and postponed or canceled projects specific to our pharma services lines that are more pronounced than we've experienced over the last two years.

In the second quarter, we saw a sequential improvement in AUP. It was a record quarter for test volumes and NGS growth at 23%.

Kendra Webster: Please refer to the information disclosed under the heading Risk Factors in our most recent Forms 10-K, 10-Q, and 8-K that we filed with the SEC to identify important risks and other factors that may cause our actual results to differ from the forward-looking statements.

Slightly below our 25% target, but well ahead of the low to mid-teens NGS market growth rate.

As we've shared in past quarters rate of our 1.0 the growth driver pro forma revenue and also provided a call point to sell other testing modalities.

As a result of the negotiated settlement. These radar 1.0 contracts are no longer producing pharma revenue in 2025.

Kendra Webster: These documents can be found in the Investors section of our website or on the SEC's website.

We can continue to capture market, share and clinical Revenue, but we made a conscious decision to Leverage The learnings from our pant Tracer liquid biopsy EAP to establish an even stronger product profile for launch.

We are adding additional testing capabilities in our portfolio to make our menu more attracted to our pharma and biotech customers such as collateral our AI powered spatial proteomics platform, which launched in June.

Kendra Webster: During this call, we refer to certain non-GAAP financial measures that involve adjustments to GAAP results. The non-GAAP financial measures presented should not be considered an alternative to the financial measures required by GAAP, should not be considered measures of liquidity, and are unlikely to be comparable to non-GAAP financial measures provided by other companies. Any non-GAAP financial measures referenced on this call are reconciled to the most directly comparable GAAP financial measures in a table available in the press release we issued this morning and available in the investor section of our website.

this meant we delayed our launch, which resulted in lower revenue and a lower than targeted NGS growth rate

While we have updated our pharma go to market strategy and made key changes to leadership it is taking longer than anticipated to yield results.

I'm excited to confirm that pant. Trades are liquid, biopsy will launched commercially tomorrow and believe that our approach to bringing this product to Market will positively impact patients, treated in the community and our NDS growth rate later this year.

So how do we plan to respond to these challenges.

Our strategic drivers are focused on three areas the customer experience the community channel and new products.

We're projecting lower than planned revenue from pharma customers for the remainder of the year, as well as a negative impact to revenue associated with lower than planned volume for pant, Tracer liquid, biopsy, and NGS mix.

Optimizing of winning the customer experience continues to be our competitive strength. We've earned a market leadership position in heat through our heavy investments in community hospitals, and we continue to invest in the community oncology side.

Tony Zook: I will now turn the call over to Tony. Thanks, Kendra. Good morning, everyone. And I thank you for joining us today.

As a result, we've updated our 2025 Financial guide which Jeff will provide more insight on in a moment.

Tony Zook: I'm pleased to lead this call having now completed my first quarter as CEO. Since becoming CEO in April, I've engaged with the business, including sales, operations, and R&D, and reexamined our strategic initiatives and financial targets from a more in-depth perspective than I could as a director. I've also met existing and potential partners at various industry conferences and had conversations with many of our shareholders to better understand their perspective. These conversations reinforce the significant opportunities to drive value for our customers, patients, and shareholders. Cancer testing continues to be a large and attractive market. Most of our business today is in diagnostic testing, though recently we have accelerated our offerings in therapy selection with the launch of several NGS products.

I am confident that Nio can continue to achieve double-digit annual growth, build product gaps through organic and inorganic activities, and capture additional market share.

To win the customer experience, we focus on investments in our sales force effectiveness and efficiency bidirectional interfaces and ordering portals as well as automation and digital pathology in the lab.

The leadership team and I have drilled down to align our cost structure with revenues re-establish, our consistent execution and rebuild credibility with our shareholders.

Last quarter, we announced our plans for epic integrations, which we believe will begin to impact our revenue in late 2025.

Investments. We are making an operating efficiencies this year, including the limbs project and digital pathology position us. Well to a more operating leverage in the back half of this year.

We're also continuing our multiyear process of integrating our multiple limbs into one single lens, which will allow us to sunset eight legacy systems.

I think it's important to spend some time discussing our Q2 results and how we intend to accelerate growth and drive value.

We believe this will give us operational efficiency enable us to further improve our turnaround times and further enhance our data assets. If you will more robust growth in our oncology data solutions business.

The pharma macro environment and conditions contributed to the revenue shortfall in the quarter versus our expectations. Specifically, market uncertainty surrounding NIH funding.

In terms of enhancing our community channel strength, we leverage our business development capabilities to establish effective compelling partnerships like the one with adaptive around delivering industry, leading heme MRV tests to our customers, which we are starting to bring to market through a controlled pilot earlier this month.

Tony Zook: In addition, our Radar 1.1 technology and R&D work in Next Generation MRD enable us to participate in a market that's underpenetrated and rapidly growing.

Drug pricing patient, enrollment and clinical trials and potential tariffs are leading directly to investment volatility and creating significant headwinds for both, our pharmaceutical and biotech clients.

Tony Zook: I acknowledge that our delivery this quarter was below expectations. While I remain extremely optimistic about the future of neogenomics, our team and I are doubling down on our efforts to focus the business on execution excellence as we build upon our discipline, financial, and operational foundation.

Our pipeline of future opportunities continues to grow as we capitalize on the recognized strength and a unique brand recognition of our channel in the community space coupled.

This is resulting in budget, restrictions free prioritization and consolidation of assets, and postponed, or canceled projects, specific to our Pharma Services line. That are more pronounced than we've experienced over the last 2 years.

Coupled with our sales effectiveness.

As we have shared in past quarters radar, 1.0 was a growth driver for Farmer revenue and also provided a call point to sell other testing modalities.

A key growth driver for clinical and pharma is focusing our R&D and business development efforts on new next generation precision guided products.

Tony Zook: But before we talk about our plans moving forward, let's spend time on the quarter. We had a solid second quarter in the core clinical business, posting significant volume and share gains in key segments. However, our non-clinical revenue was below expectations. Revenue for Q2 was $181 million, slightly below our second quarter guidance range, though still representing double-digit growth of 10% year-over-year. Our clinical business continues to expand with organic growth at 13%. Strength in our clinical business was offset by continued weakness in our non-clinical revenue, driven by lower revenue from pharma and biotech customers. In the second quarter, we saw a sequential improvement in AUP, a record quarter for test volumes, and NGS growth at 23%, slightly below our 25% target, but well ahead of the low to mid-teens NGS market growth rate.

As a result of the negotiated settlement, these radar 1.0 contracts are no longer producing far, more Revenue in 2025,

We believe that Marty and therapy selection Ngls provide the biggest market opportunities and represent the largest associated unmet need.

The $30 billion market, specifically represents a significant unmet clinical needs, particularly in low shutting cancers.

we are adding additional testing capabilities in our portfolio, to make our menu more attractive to our farm and biotech customers such as pletra our AI powered spatial proteomics platform, which launched in June

<unk> has the potential to transform cancer care by enabling earlier detection of recurrence.

While we have updated our form of go-to Market strategy and made key changes in leadership, it is taking longer than anticipated to yield results.

How do we plan to respond to these challenges?

More precise treatment decisions and better outcomes for patients.

This also makes them already highly relevant to Biopharma partners to advance targeted therapies.

Our strategic drivers are focused on 3 areas, the customer experience the community Channel and new products.

We intend to make further progress here of all of our product portfolio to be more comprehensive across the cancer care continuum.

Simultaneously, we will continue building on our deep relationships with the community hospital pathologists and growing relationships with community oncologists, providing us with an even wider competitive moat and reinforcing our responsibility to inform treatment decisions with actionable insights.

Optimizing and winning the customer experience. Continues to be our competitive strength. We've earned a market leadership position in hand, through our heavy investments in Community Hospitals, and we continue to invest in the community oncology site.

Tony Zook: We can continue to capture market share and clinical revenue, but we made a conscious decision to leverage the learnings from our Pantracer liquid biopsy EAP to establish an even stronger product profile for launch. This meant we delayed our launch, which resulted in lower revenue and a lower than targeted NGS growth rate.

To win the customer experience. We focus on investments in our sales force. Effectiveness, and efficiency, bidirectional interfaces and ordering portals as well. As Automation and digital, pathology in the lab,

As I mentioned at the outset of this call Ive met with many of our shareholders to better understand their perspectives.

Last quarter, we announced our plans for epic Integrations, which we believe will begin to impact our Revenue in late 2025.

They challenged us to rethink our confidence levels and to be transparent in our guidance incorporating the risks and uncertainties inherent in our industry and our business.

Tony Zook: I'm excited to confirm that Pantracer liquid biopsy will launch commercially tomorrow and believe that our approach to bringing this product to market will positively impact patients treated in the community and our NGS growth rate later this year. We're projecting lower than planned revenue from pharma customers for the remainder of the year, as well as a negative impact of revenue associated with lower than planned volumes for pantrace or liquid biopsy and NGS mix.

We're also continuing our multi-year process of integrating our multiple limbs into 1 single limbs which will allow us to Sunset 8 Legacy systems.

We take this feedback seriously and I want our shareholders to know they have been hurt.

Revising our 2025 guidance reflects the headwinds I discussed while at the same time acknowledging the efforts we have implemented to best position the company for the future.

enable us to further improve our turnaround times and further, enhance our data assets to fuel, more robust growth, in our oncology Data Solutions business,

I am confident we can achieve these forecast and if we execute on our action plan and I'm just as confident that there is additional upside we can capture as well we.

Tony Zook: As a result, we've updated our 2025 financial guide, which Jeff will provide more insight on in a moment. I am confident that NEO can continue to achieve double-digit annual growth, build product gaps through organic and inorganic activities, and capture additional market share. The leadership team and I have drilled down to align our cost structure with revenues, reestablish our consistent execution, and rebuild credibility with our shareholders. Investments we are making in operating efficiencies this year, including the LIMS project and digital pathology, position us well to achieve more operating leverage in the back half of this year.

We intend to prove that one quarter at a time.

As a member of the board of directors I approve the update to the long range plan, we communicated earlier this year.

In terms of enhancing our community Channel strength, we leverage our business development capabilities to establish effective compelling Partnerships like the 1 with adaptive around delivering industry-leading team, mrd tests to our customers, which we have started to bring to Market to a control pilot earlier this month.

As CEO one of my primary objectives has been to oversee the execution of the strategy behind the plan.

Our pipeline of future opportunities continues to grow as we capitalize on the recognized strengths and the unique brand recognition of our channel in the community space.

And proactively identify opportunities to improve upon it.

Coupled with our sales effectiveness.

Here's how I think about our long range plan, it's just that long range. While the plan covers the company's execution of certain key metrics. During the next five years. This does not guarantee that the plan is going to correlate exactly to our guidance for the coming year and there will be variability from year to year.

A key growth driver for clinical and Pharma is focusing. Our R&D and Business Development efforts on new Next Generation Precision, guided products.

Tony Zook: I think it's important to spend some time discussing our Q2 results and how we intend to accelerate growth and drive value. The pharma macroenvironment conditions contributed to the revenue shortfall in the quarter versus our expectations. Specifically, market uncertainty surrounding NIH funding, drug pricing, patient enrollment in clinical trials, and potential tariffs are leading directly to investment volatility and creating significant headwinds for both our pharmaceutical and biotech clients. This is resulting in budget restrictions, reprioritization, and consolidation of assets, and postponed or canceled projects specific to our pharma services line that are more pronounced than we've experienced over the last two years.

We believe that MRD and therapy selection NGS provide the biggest market opportunities and represent the largest associated unmet need.

My confidence in the long range plan is based on three key assumptions.

First we believe that the core business, which now includes path line will continue to grow at a 10% plus rate even with the headwinds affecting our pharma revenue.

The 30 billion mrd Market specifically represents significant unmet clinical needs. Particularly in low shedding cancers.

Second our business development activities will add incremental revenue that materialized gradually with significant growth in the out years, but the timing will be lumpy, depending on deal terms and structures.

MRD has the potential to transform cancer care by enabling earlier detection of recurrence, more precise treatment decisions, and better outcomes for patients.

This also makes it highly relevant to biofarma partners in advanced targeted therapies.

Finally, as we increase our investments in R&D and launch penetrates in liquid biopsy and future products like Nextgen MLD we.

We intend to make further progress here. Involve our product portfolio to be more comprehensive across the Cancer Care. Continuum

To generate incremental revenue through consistent improvement in NGL mix and growth.

Tony Zook: As we've shared in past quarters, RADAR 1.0 is a growth driver for pharma revenue and also provided a call point to sell other testing modalities. As a result of the negotiated settlement, these Radar 1.0 contracts are no longer producing pharma revenue in 2025. We are adding additional testing capabilities in our portfolio to make our menu more attractive to our pharma and biotech customers. such as Paletra, our AI-powered spatial proteomics platform, which launched in June.

Beyond that to the extent the pharma headwinds subside there is upside.

simultaneously, we will continue building on our deep relationships with the community hospital Pathologists and growing relationships with Community oncologists providing us with an even wider competitive. Moat and reinforcing our responsibility to inform treatment decisions with actionable insights.

As we progress into the back half of 2025, we will continue to monitor the impact of the recently passed federal budget Bill.

As I mentioned at the outset of this call, I've met with many of our shareholders to better understand their perspectives.

Changes in the form of landscape and the success of our liquid biopsy launch.

Consistent with our historical practice, we will release, our 2026 guidance. When we report our 2025 full year earnings in February of 2026.

They challenge us to rethink our confidence levels and to be transparent in our guidance, incorporating the risks and uncertainties inherent in our industry and our business.

Tony Zook: While we have updated our pharma go-to market strategy and made key changes in leadership, it is taking longer than anticipated to yield results.

We take this feedback seriously, and I want our shareholders to know they have been heard.

Going forward like many in our industry, we will not be providing external updates on our progress against the long range plan and we will instead focus on our near term guidance targets.

Tony Zook: So how do we plan to respond to these challenges? Our strategic drivers are focused on three areas, the customer experience, the community channel, and new products. Optimizing and winning the customer experience continues to be our competitive strength. We've earned a market leadership position in Heaton through our heavy investments in community hospitals, and we continue to invest in the community oncology setting. To win the customer experience, we focus on investments in our sales force effectiveness and efficiency, bi-directional interfaces and ordering portals, as well as automation and digital pathology in the lab. Last quarter, we announced our plans for EPIC integrations, which we believe will begin to impact our revenue in late 2025.

Revising our 2025 guidance, reflects the headwinds I've discussed. While at the same time acknowledging the efforts, we've implemented to best position the company for the future.

Based on my experience. These last four months are more optimistic than ever about <unk> future.

And with that I'll hand, it over to Jeff to further discuss our results from the quarter.

I'm confident we can achieve these forecasts and if we execute on our action plan, I'm just as confident that there is additional upside we can capture as well.

Thanks, Tony and good morning.

We intend to prove that, one quarter at a time.

Second quarter total revenue growth accelerated from Q1 and increased 10% over prior year of $181 million.

As a member of the Board of Directors, I approve the update to the long-range plan. We communicated earlier this year.

Total clinical revenue continued with double digit growth and increased by 16% from the prior year.

Organic clinical revenue was $160 million representing growth of 13% driven by a 10% increase in test volumes and a 3% increase in A&P.

As CEO 1 of my primary objectives has been to oversee the execution of the strategy behind the plan and proactively identify opportunities to improve upon it.

In the second quarter MTS testing accounted for 32% of total clinical revenue and grew by 23% over prior year.

Tony Zook: We're also continuing our multi-year process of integrating our multiple limbs into one single limbs, which will allow us to sunset eight legacy systems. We believe this will give us operational efficiency, enable us to further improve our turnaround times, and further enhance our data assets to fuel more robust growth in our oncology data solutions. In terms of enhancing our community channel strength, we leverage our business development capabilities to establish effective, compelling partnerships, like the one with Adaptive, around delivering industry-leading EME and MRD tests to our customers, which we have started to bring to market through a control pilot earlier this month.

Here's how I think about our long-range plan, it's just that long range. While the plan covers the company's execution of certain key metrics during the next 5 years, this does not guarantee that the plan is going to correlate. Exactly, to our guidance, for the coming year and there will be variability from year to year.

This strong clinical growth was partially offset by non clinical revenue declining by 26% over prior year driven by weakness in the pharma revenue Tony spoke about.

My confidence in the long range plan is based on 3 key assumptions.

The second quarter was also a difficult comp with prior year pharma revenue of $18 7 million or 10% higher than the average pharma revenue per quarter in 2024.

first, we believe that the Core Business which now includes path lines will continue to grow at a 10% plus rate even with the headwinds affecting, our farmer Revenue

Adjusted gross profit improved by $4 6 billion or 6% over prior year adjusted EBITDA was $10 7 million down 2% from prior year, while delivering our eighth consecutive quarter of positive adjusted EBITDA.

Second, our business development activities will add incremental Revenue that materializes gradually, what significant growth in the out year, but the time will be lumpy depending on deal terms and structures.

Tony Zook: Our pipeline of future opportunities continues to grow as we capitalize on the recognized strengths and the unique brand recognition of our channel in the community space, coupled with our sales effects. A key growth driver for clinical informants is focusing our R&D and business development efforts on new, next-generation, precision-guided products. We believe MRD and Therapy Selection NGS provide the biggest market opportunities and represent the largest associated unmet needs. The $30 billion MRD market specifically represents significant unmet clinical needs, particularly in low-shedding cancer. MRD has the potential to transform cancer care by enabling earlier detection of recurrence, more precise treatment decisions, and better outcomes for patients.

The decrease was due primarily to the acquisition of topline as the business is ramping.

Finally, as we increase our investments in R&D and launch Pantry as a liquid biopsy and future products like NextGen MRI. We expect to generate incremental Revenue through consistent Improvement in NGS, mix and growth.

Beyond that to the extent. The farmer headwind subside, there is upside.

Excluding top line adjusted EBITDA improved by $1 4 million to $12 3 million or 13% from prior year.

As we progress into the back, half of 2025, we will continue to monitor the impact of the recently. Passed federal budget bill

Average revenue per clinical test increased by 2% to $461 from the prior year, an increase sequentially from Q1, even with the lower <unk>.

Changes in the formal landscape and the successful liquid biopsy want.

Pine volume.

Excluding pipeline AEP grew 3% over prior year due to increased ordering of higher value tests, including Ngls and strategic reimbursement initiatives.

Consistent with our historical practice, we will release our 2026 guidance when we report our 2025 full-year earnings in February of 2026.

As I noted on the first quarter call. We have successfully renegotiated several managed care agreements in the second quarter, which will positively impact revenue in the second half of 2025.

Going forward, like many in our industry, we will not be providing external updates on our progress against the long-range plan and will instead focus on our near-term guidance targets.

Tony Zook: This also makes MRD highly relevant to biopharma partners to advance targeted therapy. We intend to make further progress here and evolve our product portfolio to be more comprehensive across the cancer care continuum. Simultaneously, we will continue building on our deep relationships with the community hospital pathologists and growing relationships with community oncologists, providing us with an even wider competitive moat and reinforcing our responsibility to inform treatment decisions with actionable insights.

Based on my experience, these last 4 months, I'm more optimistic than ever about NEOS future.

Q2 results include a noncash impairment charge of $20 million associated with the upcoming replacement of our IVF Bell tests with Pan transfer liquid biopsy and the write down of Trapelo in assets held for sale.

And with that, I'll hand it over to Jeff to further discuss our results from the quarter.

Thanks, Tony and good morning.

Second quarter, total revenue, growth accelerated from q1 and increased 10% over prior year to 181 million.

While we remain focused on 2025, our full year, our revised full year guidance reflects the challenges of the current <unk> environment and its impact on customer demand as well as a delay in launching pad tracer liquid biopsy.

Total clinical Revenue continued with double digit growth and increased by 16% from prior year.

Tony Zook: As I mentioned at the outset of this call, I've met with many of our shareholders to better understand their perspective. They challenged us to rethink our confidence level and to be transparent in our guidance, incorporating the risks and uncertainties inherent in our industry and our business. We take this feedback seriously, and I want our shareholders to know they have been heard. Revising our 2025 guidance reflects the headwinds I've discussed, while at the same time, acknowledging the efforts we've implemented to best position the company for the future. I'm confident we can achieve these forecasts, and if we execute on our action plan, I'm just as confident that there is additional upside we can capture as well.

3%, increase in AUP.

At the time of our first quarter earnings call. We believe that clinical would make up for the initially projected 7 million shortfall in pharma, but demand for services has proven to be weaker than anticipated.

And the second quarter NGS, testing accounted for 32% of total, clinical revenue and grew by 23% over prior year.

As a result of $7 million gap will increase and we no longer believe that clinical can make up the pharma services shortfall for 2025.

this strong clinical growth was partially offset by non-clinical Revenue declining by 26% over prior year, driven by weakness in the farmer Revenue Tony spoke about

For full year 2025, we now anticipate revenue of $728 million to $726 million, representing 9% to 10% growth for the year with adjusted EBITDA of 41% and $44 million.

the second quarter was also a difficult comp with prior year farmer revenue of 18.7 million or 10% higher than the average farmer Revenue per quarter in 2024,

The topline integration is on track and progressing well with the potential impact to adjusted EBITDA of negative $1 million for the remainder of the year.

Tony Zook: We intend to prove that one quarter at a time. As a member of the Board of Directors, I approve the update to the long-range plan we communicated earlier this year. As CEO, one of my primary objectives has been to oversee the execution of the strategy behind the plan and proactively identify opportunities to improve upon it. Here's how I think about our long-range plan. It's just that, long-range. While the plan covers the company's execution of certain key metrics during the next five years, this does not guarantee that the plan is going to correlate exactly to our guidance for the coming year, and there will be variability from year to year.

We remain well positioned to invest in our business and capitalize on the growth opportunities in our strategic plan.

Majestic growth profit improved by $4.6 billion, or 6%, over the prior year. Adjusted EVA was $10.7 million, down 2% from the prior year, while delivering our eighth consecutive quarter of positive adjusted EVA.

We significantly reduced our debt in the second quarter with the retirement of the $201 million convertible notes due in may out of our existing cash.

the decrease of due primarily to the acquisition of pipeline as the business is ramping.

Excluding path line adjustability, it improved by $1.4 million to $12.3 million, or 13% from the prior year.

Cash flow from operations in the second quarter was a positive $20 million, an improvement of $6 million or 44% over the prior year and we ended the quarter with cash and marketable securities of $164 million.

Average revenue per clinical test increased by 2% to $461 from the prior year and increased sequentially from Q1, even with the lower AUP topline volume.

Our balance sheet has no near term debt maturities and we continue to balance capital deployment between organic growth investments business development and improving operating efficiencies.

Tony Zook: My confidence in the long-range plan is based on three key assumptions. First, we believe that the core business, which now includes Pathline, will continue to grow at a 10% plus rate, even with the headwinds affecting our pharma revenue. Second, our business development activities will add incremental revenue that materializes gradually with significant growth in the out years, but the timing will be lumpy depending on deal terms and structure. Finally, as we increase our investments in R&D and launch Pantracer liquid biopsy and future products like NextGen MRD, we expect to generate incremental revenue through consistent improvement in NGS mix and growth.

Including Topline AUP glue 3% over prior year, due to increased ordering, and higher value tests, including the GS and strategic reimbursement initiative.

Our balanced approach towards capital generation and allocation reflects our commitment to our strategic focus areas, specifically, our investments will be focused on filling gaps in our broad menu, including ultra sensitive MRV liquid biopsy at whole genome sequencing solutions.

As I noted on the first quarter call, we have successfully renegotiated several Managed Care agreements in the second quarter, which will positively impact revenue in the second half of 2025.

We have improved the financial health of our business dramatically over the last several years and we continue to progress in Q2.

T2 results include a non-cash impairment charge of 20 million associated with the upcoming replacement of our IVF Bell test with pain Tracer, liquid biopsy and the right down of tropello and assets held for sale.

We are focused on executing our plan to achieve long term sustainable and profitable growth and delivering shareholder value.

Tony Zook: Beyond that, to the extent the pharma headwinds subside, there is a As we progress into the back half of 2025, we will continue to monitor the impact of the recently passed federal budget bill. Changes in the Pharma Landscape and the Success for Liquid Biopsy 1.

To illustrate our confidence in our strategy and path forward.

Along with Tony Warren additional management team members as several as well as several directors on our board recently purchased additional shares.

While we remain focused on 2025 our full year, our revised school year is Triplex. The challenge is the current Farm environment and its impact on customer demand as well as the delay. In launching pant, Tracer liquid biopsy.

I'll hand, it back to Tony to wrap up.

Tony Zook: Consistent with our historical practice, we will release our 2026 guidance when we report our 2025 full-year earnings in February of 2026.

Thanks, Jeff Thanks to recap, we have strong relationships in the community setting where 80% of cancer patients are treated.

Operational capacity and network footprint and financial discipline and flexibility to expand our reach and generate value for our patients and shareholders alike.

Tony Zook: Going forward, like many in our industry, we will not be providing external updates on our progress against the long-range plan, and will instead focus on our near-term guidance targets. Based on my experience these last four months, I'm more optimistic than ever about NEO's future.

At the time of our first quarter earnings call, we believe that clinical would make up for the initially projected 7 million shortfall in Pharma but demand for services has proven to be weaker than anticipated as a result. The 7 million gap will increase and we no longer believe that clinical makeup for pharmaceutical Services is shortfall for 2025.

We will remain guided by our strategic drivers and committed to our mission and vision, while focusing on generating meaningful growth and enhancing value while improving patient care.

For 2025, we now anticipate revenue of $720 million to $726 million, representing 9% to 10% of $41 million to $44 million.

Jeff Sherman: And with that, I'll hand it over to Jeff to further discuss our results from the quarter. Thanks, Tony, and good morning. Second quarter total revenue growth accelerated from Q1 and increased 10% over prior year to $181 million. Total clinical revenue continued with double-digit growth and increased by 16% from prior year. Organic clinical revenue is $160 million, representing growth of 13%, driven by a 10% increase in test volumes and a 3% increase in AUP. In the second quarter, NGS testing accounted for 32% of total clinical revenue and grew by 23% over prior years. This strong clinical growth was partially offset by non-clinical revenue, declining by 26% over prior year, driven by weakness in the pharma revenue, Tony Spoker.

Thank you for your continued interest in Neogenomics and now I'll pass it over to Kendra requests.

Thanks, Tony Alright, Tom Let's go ahead and open the line for questions.

The Top Line integration is on track and progressing well, with the potential impact to adjusted EBITDA of negative $1 million for the remainder of the year.

Certainly the floor is now open for questions if you'd like to join the queue to ask a question at this time. Please press star one on your telephone keypad, we do ask if listing on speaker phone. This morning that you pick up your handset to provide optimal sound quality. Once again. Please press star one to join the queue. At this time to ask a question. Please hold a moment while we.

We remain. Well, positioned to invest our business and capitalize on the growth opportunities in our strategic plan.

We significantly reduced our debt in the second quarter with the retirement of the $11 million notes due in May out of our existing cash.

Poll for questions.

Yeah.

And our first question. This morning is coming from Andrew Blackman from William Blair. Andrew Your line is live. Please go ahead.

Cash flow from operations. In the second quarter was a positive, 20 million and Improvement of 6 million or 44% over the prior year. And we ended the quarter with cash and marketable securities of 164 million.

Hi, guys. Good morning, Thanks for taking the question Tony maybe just start on setting guidance, we've seen several updates on both near and long term guidance update so far this year and this is yet another one so from a high level perspective, and now that you are four months into the CEOC can you, maybe just sort of talk about the process and philosophy or setting.

Our balance sheet has no near-term debt maturities. And we continue to balance capital of employment between organic growth Investments, Business Development and improving operating efficiency.

Jeff Sherman: The second quarter was also a difficult come, with prior year pharma revenue of $18.7 million, or 10% higher than the average pharma revenue per quarter in 2024. Adjusted gross profit improved by 4.6 million or 6% over prior year. Adjusted EBITDA was 10.7 million, down 2% from prior year while delivering our eighth consecutive quarter positive adjusted EBITDA. The decrease was due primarily to the acquisition of tap lines as the businesses ramped up. Excluding Pathline Adjusted EBITDA improved by 1.4 million to 12.3 million or 13% from prior year. Average revenue per clinical test increased by 2% to $461 from the prior year and increased sequentially from Q1 even with the lower AUP pathline volume.

Maybe how that's changed and I guess, maybe even more pointed here what are some of the things that you are committed to doing to rebuild credibility with the investor base. Thanks.

Our balanced approach towards Capital generation and allocation reflects our commitment to our strategic Focus areas. Specifically our investments will be focused on filling gaps, in our broad menu, including Ultra sensitive mrd liquid biopsy and whole genome sequencing Solutions.

Yes, Thanks, Andrew I do appreciate the question.

We have improved the financial health of our business dramatically over the last several years, and we continue to progress in Q2.

First off I guess, what have been my learnings.

Now have had the opportunity as you say to sit in the chair.

I will tell you there is a big difference in seeing the company yet.

10000 foot view as a director versus the opportunity to dig deep as the CEO and I have had a significant amount of learning.

We are focused on executing our plan to achieve long-term, sustainable, and profitable growth, and delivering shareholder value. This illustrates our competence in our strategy and path forward. I, along with Tony Warren, additional management team members, as well as several directors on our board, recently purchased additional shares. Now I will hand it back to Tony to wrap up.

I've had the opportunity to do deep dives with R&D with our business development teams with R&D operations and in our commercial groups and with the management team as well to be able to.

Jeff Sherman: Excluding top line AUP grew 3% over prior year due to increased ordering of higher value tests, including NGS, and strategic reimbursement initiatives. As I noted on the first quarter call, we have successfully renegotiated several managed care agreements in the second quarter, which will positively impact revenue in the second half of 2025.

Thank you to recap. We have strong relationships in the community setting where 80% of cancer patients are treated

Construct reconstruct deconstruct the budgets and long range plans to understand all of the key pieces that underpin that Andrew So I certainly have a deeper understanding of that.

Operational capacity and network footprint, and financial discipline and flexibility to expand our reach and generate value for our patients and shareholders alike.

We will remain Guided by our strategic drivers and committed to our mission and vision. While focusing on generating meaningful growth and enhancing value while improving patient care.

I've had the opportunity to meet with a lot of our investors and get their own feedback.

Jeff Sherman: Q2 results include a non-cash impairment charge of $20 million, associated with the upcoming replacement of our IVFL test with Pantracer liquid biopsy, and a write-down of Trapelo and Assets Health. While we remain focused on 2025, our revised full-year guidance reflects the challenges of the current environment and its impact on customer demand, as well as the delay in launching Pantrace or LiquidBio. At the time of our first quarter earnings call, we believed that clinical would make up for the initially projected $7 million shortfall in pharma, but demand for services has proven to be weaker than anticipated.

I can tell you.

They have not been shy about sharing their own thoughts with us it and made it very clear that just hitting a guide is insufficient that's the same as MBS and we need to be more realistic a more balanced approach to how we can face the business.

Thanks. All right. Let's go ahead and open the line for questions.

I have been told that it is absolutely appropriate to speak with confidence on the underpinnings of your core assumption tend to express other areas as upsides.

So I think that was a great moment for me as well so I take that very seriously to heart.

The floor is now open for questions. If you would like to join the queue to ask a question at this time, please press *1 on your telephone keypad. We do ask that if you are listening on speakerphone this morning, you pick up your handset to provide optimal sound quality. Once again, please press *1 to join the queue. At this time, to ask a question, please hold a moment while we pull for questions.

I've had the opportunity as well to speak with a number of our partners and potential partners.

And our first question this morning is coming from Andrew Brackman from William Blair. Andrew, your line is live. Please go ahead.

At <unk> for example, I can tell you that there have been enough.

Jeff Sherman: As a result, the $7 million gap will increase, and we no longer believe that clinical can make up the pharma services shortfall for 2025.

A real insulet of opportunistic advances by companies to see if we can work together to leverage our strength combined with theirs and so it certainly has been a learning.

Jeff Sherman: For full year 2025, we now anticipate revenue of $720 to $726 million, representing 9 to 10% growth for the year, with adjusted EBITDA of $41 to $44 million. The Pathline integration is on track and progressing well, with the potential impact to adjusted EBITDA of negative $1 million for the remainder of the year. We remain well-positioned to invest in our business and capitalize on the growth opportunities in our strategic plan. We significantly reduced our debt in the second quarter with the retirement of the $201 million convertible notes due in May out of our existing cash. Cash flow from operations in the second quarter was a positive $20 million, an improvement of $6 million or 44% over the prior year, and we ended the quarter with cash and marketable securities of $164 million.

As far as what do I need to do I think I need to speak with confidence and be transparent with how we view the business.

To share that openly with people and the biggest thing Andrew we now need to deliver.

We missed our revenue guidance quarter, its unacceptable, we understand that and take responsibility for it.

Hi guys. Good morning. Thank you for taking the question. Uh, Tony, maybe to start on setting guidance, you know, we've seen several updates on both near and long-term guidance updates so far this year, and this is yet another one. So from a high-level perspective, and now that you're four months into the CEO seat, can you maybe just sort of talk about the process and philosophy of setting guidance? Maybe how that's changed? And I guess maybe an even more important point is here, what are some of the things that you're committed to doing to rebuild credibility with the investor base? Thanks.

Now moving forward, we just have to hit and exceed our goals quarter on quarter.

Yeah, thanks Andrew. I I do appreciate the questions. Um,

Does that help.

That's very helpful. Thanks, Thanks for all that color Tony maybe what your comments on talking about the underpinnings of core assumption maybe.

Maybe as it relates to 2025 guidance can you maybe just talk about some of the levers to towards the guide down maybe just bridge the prior guidance to this guidance in terms of.

First off, I guess, um, what have been my learnings, uh, and now have had the opportunity, as you say, to sit in the chair. Um, I will tell you, there is a big difference in seeing the company at a 10,000-foot view as a director versus the opportunity to dig deep as a CEO. And I, I have had a significant amount of learning.

The key areas that you talked about.

Yes, I will focus primarily on two of them Andrew I mean mix is always an issue with a company of our size with the port the portfolio of our breath right. So.

Jeff Sherman: Our balance sheet has no near-term debt maturities, and we continue to balance capital deployment between organic growth investments, business development, and improving operating efficiency. Our balanced approach towards capital generation and allocation reflects our commitment to our strategic focus areas. Specifically, our investments will be focused on filling gaps in our broad menu, including ultra-sensitive MRD, liquid biopsy, and whole-genome sequencing solutions. We have improved the financial health of our business dramatically over the last several years, and we continue to progress in Q2. We are focused on executing our plan to achieve long-term sustainable and profitable growth and delivering shareholder value.

When you are trying to manage 500 products across our landscape you are going to see subtle shifts in mix. So that's always an issue for us to manage but I would say that there were probably two large areas that are reflected in the guide.

I've had the opportunity to do deep dives with R&D, with our business development teams, with R&D operations, and our commercial groups, and with the management team as well, to be able to construct, reconstruct, and deconstruct the budgets and long-range plans to understand all of the key pieces that underpin that, Andrew, so that I certainly have a deeper understanding of that.

First and foremost the pharma side the impact of the macro environment.

Came at a speed that I don't think we fully accounted for relative to our original guide the combination of tariffs with pricing challenges with NIH funding declines all of those things factored into an environment for our pharma and biotech customers that created uncertainty.

Jeff Sherman: To illustrate our confidence in our strategy and path forward, I, along with Tony, Warren, and additional management team members, as well as several directors on our board, recently purchased additional shares.

And I think that in large part translated into a delay in projects or reassessment of projects and sometimes stocking of projects and so I would tell you that that is probably the single largest contributor to the change in guidance for the year by representing almost two thirds of it.

I've had the opportunity to meet with a lot of our investors and get their own feedback. And you know, I can tell you, um, they have not been shy about sharing their own Thoughts with us and, and made it very clear that just hitting a guide is insufficient that's the same as in bits and we need to be more realistic and more balanced approach to how we can fade the business. Um I've been told that it is absolutely appropriate to speak with confidence on the underpinnings of your core assumptions and to express other areas that's upside.

Um, so I think that was a great learning for me as well. So I take that very seriously to heart.

Tony Zook: Now I will hand it back to Tony to wrap up. Thanks, Jeff. To recap, we have strong relationships in the community setting where 80% of cancer patients are treated, operational capacity and network footprint, and financial discipline and flexibility to expand our reach and generate value for our patients and shareholders alike.

As I said in my opening comments as well, we made a conscious decision to leverage our penetration for liquid biopsy EAP learnings and by doing so I'm glad we did it I believe we ended up with a better product profile and I believe we took the right requirements to improve that product profile moving forward.

Tony Zook: We will remain guided by our strategic drivers and committed to our mission and vision while focusing on generating meaningful growth and enhancing value while improving patient care.

Kendra Webster: Thank you for your continued interest in neogenomics, and now I'll pass it over to Kendra for questions. Thanks, Tony. All right, Tom, let's go ahead and open the line for questions. Certainly. The floor is now open for questions. If you would like to join the queue to ask a question at this time, please press star one on your telephone keypad. We do ask if listening on speakerphone this morning that you pick up your handset to provide optimal sound quality. Once again, please press star one to join the queue at this time to ask a question.

Not having <unk> in the portfolio in may as opposed to our opportunity to start the commercial launch tomorrow. We're excited by the launch tomorrow.

I've had the opportunity as well to speak with a number of our partners and potential Partners. Um, at ASCO for example, I can tell you that there have been enough, a real insight of opportunistic, uh, advances by companies to see if we can work together to leverage our strengths to combine with theirs. And so it certainly has been a learning. Um, as far as what do I need to do? I think I need to speak with confidence um and be transparent with how we view the business. Um and to share that openly with people and the biggest thing, Andrew, we now need to deliver, you know, we missed our

That is a three months delay Andrew and so that does affect our overall mix and revenue for the year.

Revenue guidance quarter. It's unacceptable we understand that and take responsibility for it. And now moving forward, we just have to hit and exceed, our goals order on quarter. That does that help?

And then I guess, maybe a final pieces. We are we are quite proud of our engineers penetration rate.

That that's very helpful. Thanks, thanks for all that color. Tony maybe. Uh, you know what your comments? I'm talking core assumptions.

23% growth for the month, but I think.

For the quarter, but it's still a little bit behind the 25% and we acknowledge all of those factors I think in the guide moving forward not least of which was as well the feedback from.

Operator: Please hold a moment while we pull for questions.

Andrew Brackmann: And our first question this morning is coming from Andrew Brackmann from William Blair.

Maybe as it relates to 2025 guidance and you maybe just talk about some of the levers to towards the guy down. Maybe just Bridge. The prior guidance to this guidance, uh, in terms of kind of the key area that you talked about, thanks.

Some of our shareholders, saying speak with confidence what can you deliver.

Tony Zook: Andrew, your line is live, please go ahead. Yeah, thanks, Andrew. I do appreciate the question. First off, I guess, what have been my learnings now that I've had the opportunity, as you say, to sit in the chair. I will tell you, there is a big difference in seeing the company at a 10,000 foot view as a director versus the opportunity to dig deep as the CEO. And I have had a significant amount of learning. I've had the opportunity to meet with a lot of our investors and get their own feedback. And, you know, I can tell you they have not been shy about sharing their own thoughts with us and made it very clear that just hitting a guide is insufficient.

<unk> opportunity for upside surprises later.

Okay I appreciate the update thanks guys.

Thanks, Andrew.

Thank you. Your next question is coming from <unk> <unk> from Morgan Stanley.

Your line is live please go ahead.

Yeah, I I I will focus primarily on 2 of them. Andrew, I mean mix is always an issue with a company of our size with the port portfolio of our breath, right? So you know, when you're trying to manage 500 products across a landscape, you are going to see subtle shifts in mixed. So that's always an issue for us to manage. But I would say that there were probably 2 large areas that are reflected in the guy.

Hello, Thank you for taking my question.

Given the focus around rolling out the pantry <unk> lineup and Jess tests in general being growth driver of the company do you see opportunities for our portfolio pruning, how do you balance being one stop shop for your customers versus focusing on allocating and recycling some less profitable products.

I'm, sorry could you just repeat the last part.

How do you balance being.

Being one stop shop for your customers first as allocating our resources to the most profitable products.

Okay, that's great.

Great question first let's start with pantries for liquid biopsy.

First and foremost, the Pharma side, the the impact of the macro environment. Um, came at a speed that I don't think we fully accounted for relative to our original guide. The combination of of tariffs with, you know, pricing challenges with NIH funding, uh, declined. All of those things, factored into an environment for our farm and biotech, customers that created uncertainty. Um and I think that in large part translated into a delay in projects or, you know, reassessment of projects and sometimes stopping a project. And so I would tell you that, that is probably the single largest contributor to

As you as you say, we are looking forward to the launch Tomorrow. We believe we have a very competitive product to bring to market and it's one that our customers have actually asked us for because it complements that our family of <unk> products.

The change in guidance for the year, probably representing almost two-thirds of it.

It will be a comprehensive panel over 500 genes will include <unk> and MSI guide to Immunotherapies.

Been able to lower our input requirements. So that we get better collection methods and yielding strong very strong CNS profile.

We've been able to support a turnaround time that we believe will be less than seven days and I think that factors into.

Andrew Brackmann: That's the same as a miss. And we need to be more realistic, a more balanced approach to how we convey the business. I've been told that it is absolutely appropriate to speak with confidence on the underpinnings of your core assumptions and to express other areas as offsets. So I think that was a great learning for me as well. So I take that very seriously to heart. I've had the opportunity as well to speak with a number of our partners and potential partners. At ASCO, for example, I can tell you that there have been a real inflow of opportunistic advances by companies to see if we can work together to leverage our strength combined with theirs.

A pretty good value proposition for our customers.

And as you say, we look to the the depth of the portfolio and.

And we believe we have solid offerings, not just in the pantries or liquid biopsy family of products, but across.

The spectrum of products that.

Wanted to come Yeah, let me add to that sufficient format I would say that.

Our broad portfolio is absolutely a strength when we think about labs, sending ask their oncology testing and looking to consolidate vendors that they want to send their testing too and this puts neogenomics in a very unique position that we are able to address most of their needs, having said that yes, our strategy is to protect.

The right, um, requirements to to improve that product profile moving forward, but not having pancreas or in the uh portfolio in May as opposed to, you know, our our opportunity to start the commercial launch tomorrow. We're excited by the launch tomorrow, but that is a 3-month delay. Andrew and, you know, and so that does affect our overall mix and revenue for the year. And then, I guess maybe a final piece is, you know, we are, we are quite proud of our NGS penetration rate, you know, we did 23% growth, you know, for the month. But I for the quarter minutes, still a little bit behind the 25%, we acknowledge all those factors. I think in the guide moving forward and not least of which was as well as feedback. Um, from some of our shareholders saying, speak with confidence, what can you deliver, you know, and if there's opportunity for upsides and surprises later,

Okay, I appreciate the update. Thanks, guys.

Thanks Andrew.

Tony Zook: And so it certainly has been a learning. As far as what do I need to do? I think I need to speak with confidence and be transparent with how we view the business and to share that openly with people. And the biggest thing, Andrew, we now need to deliver.

Our position on the diagnosis side that invest significantly in therapy selection and <unk>, which are the areas, where we see Buster Boston grows larger towns.

Thank you. Your next question is coming from Yuko oku from Morgan Stanley Buco. Your line is live. Please go ahead.

So with that we definitely see opportunities to simplify the portfolio, which we have done in 2025, and we will continue to do for the rest of the year in each of the future and our strategy is to provide a holistic solution to our oncology physicians from.

Andrew Brackmann: We missed our revenue guide this quarter. It's unacceptable. We understand that and take responsibility for it. And now moving forward, we just have to hit and exceed our goals quarter on quarter. Does that help? That's very helpful. Thanks for all that color, Tony.

Hello. Thank you for taking my question. Given the focus around rolling out the pantry, it's a lineup and NGS tests in general being growth drivers for the company, do you see opportunities for portfolio pruning? How do you balance being a one-stop shop for your customers versus focusing on allocating your resources to the most profitable products?

Sure, I could just repeat the last part.

Tony Zook: Maybe, you know, what your comments and talking about the underpinnings of core assumption, maybe as it relates to 2025 guidance, can you maybe just talk about some of the levers to towards the guide down, maybe just bridge the prior guidance to this guidance in terms of the key areas that you talked about? Thanks. Yeah, I will focus primarily on two of them, Andrew. I mean, mix is always an issue with a company of our size with the portfolio of our breadth, right? So, you know, when you're trying to manage 500 products across a landscape, you are going to see subtle shifts in mix.

Diagnosis perspective therapy selection and <unk> point of view and then I would say from an overall portfolio perspective, you should expect work, we're continuing to evaluate the whole portfolio as Lauren said its an ongoing process.

Oh, how do you balance being a one-stop shop for your customers versus allocating your resources to the most profitable products?

Okay, it's a great question first. Let's start with pancreas or liquid biopsy.

Pruning and refining based upon customer needs.

Great. Thank you for that color and then.

Question could you also provide us with an update regarding their IV litigation I think that was a recent order a motion to expedite what does it mean for that trial expected to occur I think in the October timeframe.

Tony Zook: So that's always an issue for us to manage. But I would say that there were probably two large areas that are reflected in the guide. First and foremost, the pharma side. The impact of the macro environment came at a speed that I don't think we fully accounted for relative to our original guide. The combination of tariffs with pricing challenges, with NIH funding declines, all of those things factored into an environment for our pharma and biotech customers that created uncertainty. And I think that, in large part, translated into a delay in projects or reassessment of projects and sometimes stopping of projects.

Yes, first relative to the litigation I can you can appreciate this I'm not going to go into detail knowable members of the team with any ongoing litigation what I can update you on is that the trial is slated for October.

As you as you say, you know, we are looking forward to the launch tomorrow. Um, we believe we have a very competitive product to bring to Market its 1. That our customers have actually asked us for um, because it complements that our family of pant. Tracer products. Um, could be a comprehensive uh panel over 500 genes that will include pnb and and MSI that guide them, you know, therapies. Um, we've been able to lower our input requirements so that we get better collection methods and yielding strong, very strong cue ands profile.

Either way I can tell you, though we are committed to the <unk> space as <unk> seen we are partnering with adaptive to bring forward.

Oh great.

The heat product into the marketplace and we're proud to do that.

Get benefit from that by.

Being in the marketplace and taking those lingering Cindy the added benefit to what the rest of our portfolio.

Tony Zook: And so I would tell you that that is probably the single largest contributor to the change in guidance for the year, probably representing almost two-thirds of the country. As I said in my opening comments as well, we made a conscious decision to leverage our Pantracer liquid biopsy EAP learning. And by doing so, I'm glad we did it, I believe we end up with a better product profile. And I believe we took the right requirements to improve that product profile moving forward. But not having Pantracer in the portfolio in May, as opposed to our opportunity to start the commercial launch tomorrow.

We're going to continue to invest in our Nextgen and Marty So that is built into our R&D plans moving forward.

We have done our preparatory work behind the scenes. So we have completed and submitted our bridging study.

Two the two mol Dx and we are doing all the prep work, we need for launch and so I will tell you that we are prepared and ready.

Um, we've been able to support a turnaround time, that we believe will be less than 7 days and and think that factors into, you know, a, a pretty good value proposition for our customers. Um, and if you say, you know, we look to the, the depth of the portfolio, uh, and we believe we have solid offerings, not just in the pantry or like, the biopsy family of products, but across the, uh, the spectrum of products and where to come. Yeah, let me add to that. So, first and foremost, I'd say that our broad portfolio is absolutely a strength. When we think about Labs sending out their oncology testing, they're looking to consolidate vendors that they want to send their testing to. And this puts a near genome, in a very unique position that we're able to address most of their needs. Having said that. Yes, uh,

Now recently Natera has filed a motion for a bench trial.

Opposed at motion, we believe that we have a constitutional right under the seventh amendment for jury trial and the court has yet to rule on that motion. So I would tell you stay tuned youll note. When we know, but we are coming into this space and we are committed to the space.

Tony Zook: We're excited by the launch tomorrow, but that is a three-month delay, Andrew. And so that does affect our overall mix and revenue for the year. And then I guess maybe a final piece is we are quite proud of our NGS penetration rate. We did 23% growth for the month, but for the quarter, it's still a little bit behind the 25%. And we acknowledge all those factors, I think, in the guide moving forward. And not least of which was as well the feedback from some of our shareholders saying, speak with confidence. What can you deliver? And if there's opportunity for upside, then surprise us later.

Our strategy is to protect our position on the diagnosis side, but invest significantly in therapy, selection and mrd, which is the areas where we see Foster Foster growth larger towns. Um, so with that we we definitely see opportunities to simplify the portfolio which we have done in 2025 and will continue to do for the rest of the year and and into the future. But our strategy is

Thank you.

Youre welcome.

Thank you. Your next question is coming from <unk> <unk> from Guggenheim Securities Subaru. Your line is live. Please go ahead.

Hi, This is Thomas <unk> on for Simeon. Thanks for taking the questions just to start can you get us comfortable with the second half ramp specifically with Ngls now that penetration was delayed a bit and also with the continued pharma pressures where do you feel the guide is most aggressive still and where is it most derisked.

To provide a holistic solution to our oncology physicians from a diagnosis perspective, therapy selection, and MRD point of view. And then I would say, from an overall portfolio perspective, you should expect. We're continuing to evaluate the whole portfolio, and as Warren said, it's an ongoing process of pruning and refining, you know, based upon customer needs.

Andrew Brackmann: Great. Appreciate the update. Thanks, guys. Thanks, Andrew.

I actually think that we have a much more confident and balanced guide in the second half I would tell you the greatest risk to the guide was on the pharma side.

Yuko Oku: Your next question is coming from Yuko Oku from Morgan Stanley. Yuko, your line is live. Please go ahead. Hello, thank you for taking my question. Given the focus around rolling out the Pantrancer lineup and NGS tests in general being growth driver of the company, do you see opportunities for portfolio pruning? How do you balance being one stop shop for your customers versus focusing on allocating your resources to the most profitable product? I'm sorry, could you just repeat the last part? Oh, how do you balance being one stop shop for your customers versus allocating your resources to the most profitable product?

Great, thank you for that caller and then I'll talk to a follow-up question. Um, could you also provide us with an update regarding Raider ID litigation? I think there was a recent order on motion to expedite. What does it mean for the trial expected to occur? Uh, I think in the October time frame,

So we have further reduced the pharma business plan.

And by the way we've not just in revenue. We've also taken some hard decisions relative to the cost base associated with pharma as well.

So I would tell you that was the largest risk to the plan.

As far as the biggest growth drivers in the plan for the second half as you know we've invested in our selling force and we monitor that very very closely.

Yeah, first relative to uh, the litigation, I I, again, you can appreciate this. I'm not going to go into detail. Noble members of the team with any ongoing litigation. What I can update you on? Is that the trial legislative for October? Um, either way, I could tell you though, we are committed to the mrd space. As you've seen we are partnering with adaptive to bring forward um a great mrd product into the marketplace and we're proud.

We expect to see increased effectiveness and efficiency with that investment in our salesforce to help us further penetrate the NGL segment.

Tony Zook: Okay, that's a great question. First, let's start with pantrace or liquid biopsy. As you say, you know, we are looking forward to the launch tomorrow. We believe we have a very competitive product to bring to market. It's one that our customers have actually asked us for because it complements that our family of Pantracer products. It'll be a comprehensive panel over 500 genes. We'll include TMB and MSI that guides immunotherapies. We've been able to lower our input requirements so that we get better collection methods and yielding strong, very strong QMS protocols. We've been able to support a turnaround time that we believe will be less than seven days and think that factors into, you know, a pretty good value proposition for our customers.

Certainly penetration liquid biopsy plays a big role in the second half. In addition to just the normal back half of the year increase that we see historically.

The adaptive partnership is also an opportunity for us in the second half of the year and I would also tell you that we are well on plan with our path line integration and that started first and foremost with just getting the integration correct getting it done right.

Making sure that there were no hiccups, along the way, but as you will recall that was a more strategic value to us and we want to see the opportunity to further drive share of our ongoing business in the second half of the year up into the northeast and so best in warrant on their commercial teams are focusing hard there.

Um, we have done our preparatory work behind the scenes, so we have completed and submitted our bridging study to Multex. We are doing all the prep work we need for launch. And so, I will tell you that we are prepared and ready. Um, now recently NA has filed a motion for a bench trial. Um, we oppose that motion; you know, we believe that we have a constitutional right under the 7th Amendment for a jury trial, and the court has yet to rule on that motion. So, you know, I would tell you to stay tuned; you'll know when we know, but we are coming into this space and we are committed to the space.

Thank you.

And then finally, we are.

Warren Stone: And as you say, you know, we look to the depth of the portfolio, and we believe we have solid offerings, not just in the Pantracer liquid biopsy family of products, but across the spectrum of products.

You're welcome.

Working hard on interfaces with our customer base.

With that as an opportunity for us in the second half of the year as well.

When those interfaces go live you have a better opportunity for increased penetration because it just makes it so much easier for customers to do business across our portfolio.

Thank you. Your next question is coming from Subu Nambi from Guggenheim Securities. Subu, your line is live. Please go ahead.

Warren Stone: Warren, any comment? Yeah, let me add to that. So, first and foremost, I'd say that our broad portfolio is absolutely a strength. When we think about labs sending out their oncology testing, they're looking to consolidate vendors that they want to send their testing to, and this puts Neogenomics in a very unique position that we're able to address most of their needs. Having said that, yes, our strategy is to protect our position on the diagnosis side, but invest significantly in therapy selection and MRD, which are the areas where we see foster growth larger times. So, with that, we definitely see opportunities to simplify the portfolio, which we have done in 2025 and will continue to do for the rest of the year and into the future.

Thanks for the question.

Thank you.

And then just for my follow up last quarter, you talked about I think it was five products meaningfully contributing to <unk> revenue did you have a similar concentration in this quarter and can you talk about if you expect that to evolve at all over the phone.

Hi. This is Thomas Bond on procedure. Thanks for taking the questions. Uh, just to start. Can you get us comfortable with the second half ramp uh, specifically with NGS. Now that pant tracer was delayed a bit. And also with the continued Pharma pressures, where do you feel? The guide is most aggressive still? And where is it? Most due risk?

More confident.

For the year. Thank you.

Yeah, we.

Thanks again for the follow up we do expect it to evolve we expect it to evolve in the increase.

The pipe concentrated products that we spoke too because when we've talked about their ability that they represented almost 21% of our clinical revenue.

That has continued to grow and we saw in this quarter, that's up to about 23%.

And relative to the broader business all of our NTS products are now have eclipsed about a 30% of our total revenue and so this is an important growth driver for us we monitor it closely.

Warren Stone: But our strategy is to provide a holistic solution to our oncology positions from a diagnosis perspective, therapy selection, and MRD point of view. And then I would say, from an overall portfolio perspective, you should expect we're continuing to evaluate the whole portfolio, and as Warren said, it's an ongoing process of pruning and refining, you know, based upon customers.

And it's one of the biggest opportunities for us over the medium and long term as well, but thanks for the follow up.

Thank you. Your next question is coming from Mike Matson from Needham <unk> Company. Mike. Your line is live. Please go ahead.

Yuko Oku: Great, thank you for that color. And then a follow up question.

Yes. Thanks.

Just wanted to clarify the comments on the long range plan. So you are talking about double digit growth now so does that just to be clear are you backing off the 12% 13% target of these set earlier this year.

Yuko Oku: Could you also provide us with an update regarding RADAR IV litigation? I think there was a recent order on motion to expedite. What does it mean for the trial expected to occur, I think, in the October timeframe? Yeah, first, relative to the litigation, again, you can appreciate this. I'm not going to go into detail, knowable members of the team with any ongoing litigation. What I can update you on is that the trial is slated for October. Either way, I can tell you, though, we are committed to the MRD space. As you've seen, we are partnering with Adaptive to bring forward a great MRD heme product into the marketplace, and we're proud to do that.

And balanced guide in the second half. I, I would tell you the greatest risk to the God was on the far side. Um, and so we have further reduced, um, the form of business plan. Um, and by the way, we've not just in Revenue, we've also taken some hard decisions relative to the cost based associated with Pharma as well. Um, so I'm going to tell you that was the largest risk to the plan. Uh as far as the the biggest growth drivers in the plan for the second half uh as you know we've invested in our selling force and we monitored that very very closely. Um, we expect to see increased Effectiveness and efficiency with that investment in the sales force to help us further penetrate the NGS segment. Um, certainly pant Tracer, liquid biopsy plays a big role in this second half. Uh, in addition to just the normal back half year increase that we see historically, um, the Adaptive partnership is also an opportunity for us, uh, in the second half of the year. And, and I would also tell you that we are well on plan with our path line integration. Um, and that started first and foremost,

So you're expecting kind of a 10% plus over the next few years.

Yes, Mike Thanks for the question what I first off we are not backing off of our long range plan, but what I am trying to do Mike is create added transparency. So that there is no ambiguity of what is in it and how I view the business.

With just getting the integration correct. Getting it done right? Uh and making sure that there were no hiccups along the way, but as you will recall, that was a more strategic value to us and we want to see the opportunity to further Drive share of our ongoing business in the second half of the Year up into the Northeast and so Beth and Warren on. Their commercial teams are are focusing hard there.

And so that's why I'm trying to drive for more clarity.

My conversations with investors they ask for that because what's in what's out and how do you get there from here was a big question. So.

Tony Zook: We get benefit from that by being in the marketplace and taking those loan agreements and the added benefit to the rest of our portfolio. We're going to continue to invest in our next-gen MRD, so that is built into our R&D plans moving forward. We have done our preparatory work behind the scenes, so we have completed and submitted our bridging study to Mobile DX, and we are doing all the prep work we need for launch, and so I will tell you that we are prepared and ready. Now, recently, Naterra has filed a motion for a bench trial.

So let me once again just reiterated if you don't mind.

So that everybody can be clear.

And then finally, you know, we are, you know, working hard on interfaces, you know, with our customer base. Um we think that that has an opportunity for us in the second half of the year as well, because when those interfaces go live, you have a better opportunity for increased penetration because it it just makes it so much easier for customers to do business across our portfolio. So, thanks for the question.

I look at this as our base business today, what do we have in our bag to sell to bring to our customers now that has a proven I habit that base business in my mind that is a 10% growth business over the planning period, so that is our anchor position.

Thank you. Um, and then, just for my follow-up last quarter, you talked about, I think it was five products, meaningfully contributing to NGS revenue. Did you have a similar concentration in this quarter? Um, and can you talk about if you expect that to evolve at all over the balance of the year? Thank you.

Now you've heard US talk time and time again, we are not standing still as we sit here today, we are investing we're doing it responsibly, but we are investing in R&D. We do plan to have more products and therapy selection and M R&D and those opportunities to create incremental value above that base plan and I'm acknowledging that that.

Tony Zook: We oppose that motion. You know, we believe that we have a constitutional right under the Seventh Amendment for jury trial, and the court has yet to rule on that motion. So, you know, I would tell you, stay tuned. You'll know when we know, but we are coming into this space and we are committed.

Later in the cycle right.

Yuko Oku: Thank you. You're welcome. Thank you.

There's a lot of things, we can do I can't compress the time continuum and so those just come later in the cycle.

Subbu Nambi: Your next question is coming from Subbu Nambi from Guggenheim Securities. Subbu, your line is live. Please go ahead.

And then the other area that we're not going to stand still on his business development.

We believe that there are plenty of opportunities for us to supplement our portfolio. We have seen that they can add incremental growth into our business in top and bottom line performance, but I also acknowledged that they are lumpy you can't predict the exact time of those and so from my vantage point the long range plan starts with your anchor position of the 10%.

Yeah, we we, thanks again for the follow-up. We do expect it to evolve. We expect it to evolve and increase, um, the 5 concentration that we spoke to, because we talked about their ability that they represented almost 21% of our clinical Revenue, um, that has continued to grow. And we saw in this quarter that's up to about 23%, um, and relative to the broader a business, all of our NCS products are now have eclipsed about a 30% of our total revenue. And so, um, this is an important growth driver for us, we monitor it closely. Um, and it's 1 of the, the biggest opportunities for us over the medium and long term as well. So, thanks for the follow up.

Unknown Executive: Hi, this is Thomas Bonneville on Pursu. Thanks for taking the questions.

Subbu Nambi: Just to start, can you get us comfortable with the second half of RAM, specifically with NGS now that Pantracer was delayed a bit, and also with the continued pharma pressures? Where do you feel the guide is most aggressive still and where is it most de-risked? I actually think that we have a much more confident and balanced guide in the second half. I would tell you the greatest risk to the guide was on the pharma side. And so we have further reduced the pharma business plan. And by the way, not just in revenue, we've also taken some large decisions relative to the cost base associated with pharma as well.

Thank you. Your next question is coming from Mike Matson from Neiman company. Mike, your line is live. Please go ahead.

Growth in our current portfolio, we build from there with business development and of course, new product development.

That's the plan I also want to just reemphasize that to me. The long range plan is just that it's a long range plan. It is never intended to be a forecasting vehicle for any given year.

Yeah thanks. Um, so just want to clarify that the comments on the the long range plan. So you're talking about double digit growth now. So does that are, are you just to be clear? Are you backing off the 12 to 13% Target on these set earlier this year? And, um, you know, so you're expecting kind of 10% plus over the next few years.

And I plan to deemphasize these conversations around the long range plan, just like our peers to I'm.

Ability to focus our energies on our short term delivery, what can we deliver quarter over quarter, and then that gives them a year and not be focusing our energies and discussion points around our long range plan.

Tony Zook: So I would tell you that was the largest risk to the plan. As far as the biggest growth drivers in the plan for the second half, as you know, we've invested in our selling force. And we monitor that very, very closely. We expect to see increased effectiveness and efficiency with that investment in our sales force to help us further penetrate the NGS segment. Certainly, Pantracer liquid biopsy plays a big role in the second half, in addition to just the normal back half year increase that we see historically. The adaptive partnership is also an opportunity for us in the second half of the year.

That helpful.

Yes that definitely makes a lot clear and then just on the non clinical business I've been given the steep the clients we're seeing now.

I mean.

Investors. They, they asked for that because what didn't what's out? And how do you get there from here? Was a big question for you. So let me once again, just reiterate it, if you don't mind. Um, so that everybody can be clear.

Would it be possible to exit that business is there some kind of synergies with the clinical side and then what would that how profitable is that part of the business that may be an issue were more.

Warren Stone: And I would also tell you that we are well on plan with our Pathline integration. And that started first and foremost with just getting the integration correct, getting it done right and making sure that there were no hiccups along the way. But as you will recall, that was of more strategic value to us. And we want to see the opportunity to further drive share of our ongoing business in the second half of the year up into the Northeast. And so Beth and Warren on their commercial teams are focusing hard there. And then finally, we are working hard on interfaces with our customer base.

More profitable than the clinical side and then.

Hitting the bottom line to our if you were to exit it.

I look at this as our base business today. What do we have in our bag to sell to bring to our customers? Now that is a proven, I have it that base business in my mind, that is a 10% growth business over the planning period. So that is our anchor position.

Yes, Thanks again for the follow up.

Are there synergies across the lines at the answer for the operations team is yes, there are opportunities for that.

But I think the bigger question is are we committed to the space right.

I can tell you that we are we do believe in the this space it is of strategic value to us at.

It provides the opportunity for us to identify and to validate biomarkers early.

It provides the possibility and the development of companion diagnostics.

Tony Zook: We think that that has an opportunity for us in the second half of the year as well. Because when those interfaces go live, you have a better opportunity for increased penetration because it just makes it so much easier for customers to do business across our portfolio. So thanks for the question. Thank you.

It keeps us at the forefront of emerging technologies. So that we can stay not just current but a step ahead of where we might take our own activities. It also does play a role in accelerating the launch of new products right. You don't have the same reimbursement hurdles in that space. If you like across other parts of the business and so we believe in the pharma space.

Now, you've heard us talk time and time again. We are not standing still as we sit here today; we are investing. We're doing it responsibly, but we are investing in R&D. We do plan to have more products in therapy, selection, and MRD, and those opportunities will create incremental value above that base plan. I am acknowledging that, that comes later in the cycle, right? I, I, there's a lot of things we can do. I can't compress the time continuum. And so, those desks come later in the cycle. And then the other area that we're not going to stand still on is business development.

Tony Zook: And then just for my follow up, last quarter you talked about I think it was five products meaningfully contributing to NGS revenue. Did you have a similar concentration this quarter? And can you talk about if you expect that to evolve at all over the balance of the year? Thank you. Yeah, thanks again for the follow-up. We do expect it to evolve. We expect it to evolve and increase. The five concentrated products that we spoke to, we talked about their ability that they represented almost 21 percent of our clinical revenue. That has continued to grow, and we saw in this quarter that's up to about 23 percent.

Overtime that it does help create value, but I also need to be reflective of the short term impact to that and we have adjusted our revenue lines there.

And I do not personally anticipate that these changes in the environment are going to subside anytime soon and we reflected that in our business plan moving forward.

We believe that there are plenty of opportunities for us to supplement our portfolio. We have seen that they can add incremental growth into our business in top and bottom line performance. But I also acknowledge that they're lumpy; you can't predict the exact time of those. And so, from my vantage point, the long-range plan starts with your anchor position of the 10% growth in our current portfolio. We build from there with business development and, of course, new product development. Um, and that's the plan. I also want to just...

And I would add to that I think.

We still have excess capacity.

Our footprint as well as continuing as we've talked about our <unk> integration, which will allow us to increase our operating efficiencies with our pharma business as well, we don't break it out separately now, but we used to break out advanced diagnostics previously.

Tony Zook: And relative to the broader business, all of our NTS products now have eclipsed about 30 percent of our total revenue. And so this is an important growth driver for us. We monitor it closely, and it's one of the biggest opportunities for us over the medium and long term as well. So thanks for the follow-up. Thank you.

The emphasized that to me, the long range plan is just that, it's, it's a long range plan. It is never intended to be a forecasting vehicle for any given year. Um, and I plan to de-emphasize these conversations around the long range plan just like our peers. Do you know, I'm going to focus our energies on our short-term delivery. What can we deliver order over quarter and then that giving you a year and not be focusing? Our energies and discussion points around a long-range plan that

Prior periods.

You had a lower module margin profile overall in the company, but as we look at excess capacity for business development and R&D opportunities as Tony you spoke about and then the <unk> work, we still think.

Yeah, that definitely makes a lot clearer. And then just on the non-clinical business, I mean given the steep decline we're seeing now.

Mike Matson: Your next question is coming from Mike Matson from Needham & Company. Mike, your line is live. Please go ahead. Yeah, thanks. So just want to clarify that the comments on the long range plan. So you're talking about double digit growth now.

It's going to be a viable business for us going forward and we think there will be.

Plateauing out at some point in the future, which we can build upon from a growth perspective.

Okay understand thank you.

I mean, what it would it be possible to exit that business? Is there some kind of synergies with the, the clinical side? And then, you know, what would that, you know how profitable is that part of the business, is it, maybe an issue, where, you know, there's more profitable than the the clinical side and then, you know, you'd be giving it would be, hitting the bottom line to our

Tony Zook: So is that are you just to be clear, are you backing off the 12 to 13% target of the set earlier this year? And, you know, so you're expecting kind of 10% plus over the next few years? Yeah, Mike, thanks for the question. What I'm, first off, we are not backing off of our long range plan. But what I am trying to do, Mike, is create added transparency so that there is no ambiguity of what is in it and how I view the business. And so that's why I'm trying to drive for more clarity. My conversations with investors, they asked for that, because what's in, what's out, and how do you get there from here was a big question for them.

If you were to exit it,

Thank you.

Your next question is coming from Mark Massaro from V. P. I G. Mark Your line is live. Please go ahead.

This is Dan on for Mark Thanks for taking the questions Anthony just one path line.

Can you help us understand how the contribution in the quarter and was tracking relative to your internal expectations.

And then I know you've cited an intended benefit of cross selling.

Auto portfolio with pathway and customers in the past so just curious how you're feeling.

Thanks sure.

On behalf of <unk> to start that and Warren can jump in any time.

Yeah, thanks again to the followup. Like, I I, on our synergies across the lines, that the answer for, for the operations team is, is yes. There are opportunities for that. Um, but I think the bigger question is, are we committed to the space, right? Um, and I can tell you that we are, we do believe in the the space. It is of strategic value to us. Um, it provides the opportunity for us to identify and to validate biomarkers early. It provides the possibility of the development of companion Diagnostics. Um, it keeps us at the Forefront of emerging Technologies, um, so that we can stay not just current but a step ahead of where we want to take our own.

Tony Zook: So let me, once again, just reiterate it, if you don't mind, so that everybody can be clear. I look at this as our base business today. What do we have in our bag to sell, to bring to our customers now? That is a proven, I have it. That base business in my mind, that is a 10% growth business over the planning period. So that is our anchor position. Now, you've heard us talk time and time again. We are not standing still as we sit here today. We are investing, we're doing it responsibly, but we are investing in R&D.

As far as the integration and the intended results versus actual we are right on plan with the pipeline integration. The revenues were right in line with our expectations.

So we feel very very good about the shape of that acquisition and the shape of the business.

As you rightfully say.

Not just a <unk>.

Business benefit relative to pipeline alone there was strategic value associated with the acquisition, we saw the opportunity to enhance our footprint and therefore, our speed of delivery to key customers.

Tony Zook: We do plan to have more products in therapy selection and MRD. And those opportunities create incremental value above that base plan, and I'm acknowledging that that comes later in the cycle, right? There's a lot of things we can do. I can't compress the time continuum, and so those just come later in the cycle.

In certain segments of our market in the northeast and so it is our plan to continue to drive the current pipeline business, but as well take advantage of our more in depth portfolio and bring NGL products up and threw into the northeast with greater rigor and speed.

That was always intended to take place in the latter half of this year would that benefit be more realized in 2026 and of course, we will do everything in our power to pull as much of that forward as possible.

Tony Zook: And then the other area that we're not gonna stand still on is business development. We believe that there are plenty of opportunities for us to supplement our portfolio. We have seen that they can add incremental growth into our business in top and bottom line performance, but I also acknowledge that they're lumpy. You can't predict the exact time of those. And so from my vantage point, the long range planning starts with your anchor position of the 10% growth in our current portfolio. We build from there with business development and of course, new product development, and that's the plan.

Activities. It also does play a role like in in accelerating the launch of of new products, right? You don't have the same reimbursement hurdles in that space that you might across other parts of the business. So we believe in the pharmaceutical space over time, that it does help create value. But I also need to be reflective of the short-term impact to that and we have adjusted, um, our Revenue lines there. Um, and I do not personally anticipate that these changes in the environment are going to subside anytime soon and we reflected that in our business plan, moving forward. Yeah. And I would add to that. I think, you know, we still have excess capacity, you know, in our footprint, as well as a continuing. As we've talked about our lens integration which will allow us to increase our operating efficiency for our farmer business as well. Uh, we don't break it out separately, uh, now but we used to break out against Diagnostics previously, uh, and and prior periods, and it had a lot. It had a lower margin margin profile overall than the company. But as we look at excess capacity, you know, the

Look the warrants you want to add some additional color yes. Thanks, Dan you've kept most of the key points I think one of the key elements for us to really enable this capability in northeast Vista further validate test within this lab and that was always planned to take place in the second Florida and again just to remind everybody. We closed this acquisition the early part of the.

Business Development and R&D opportunities as Tony spoke about and then the blinds work. Uh, we still think it, it, you know, it's going to be a viable business for us going forward. And, and we think there will be, you know, a plot going out at some point in the future, which we can build upon from a growth perspective.

Okay, understand. Thank you.

Second quarter as well so we've actually completed the validation requirements for these additional tests that we wanted to move into the northeast to round out.

Tony Zook: I also wanna just reemphasize that to me, the long range plan is just that, it's a long range plan. It is never intended to be a forecasting vehicle for any given year. And I plan to de-emphasize these conversations around the long range plan, just like our peers do. You know, I'm going to focus our energies on our short-term delivery. What can we deliver quarter over quarter and in that given year and not be focusing our energies and discussion points around a long range plan. Is that helpful? Yeah, that definitely makes a lot clearer.

Thank you. Your next question is coming from Mark, Msaro from VT. Mark, your line is live. Please go ahead.

The portfolio Thats required in that lab and now we are actively addressing these opportunities to drive additional share of wallet and pull through.

The sort of opportunity funnel looks robust and certainly expect to see many of those come to fruition in the second half of the year and as Tony said that would be an upside for us in the second half and certainly that would drive material value for us in 2026 and beyond.

Just help us understand how the contribution in the quarter um was tracking relative to your internal expectations. Um and then I know you've cited an intended benefit of cross-selling. Um the broader portfolio with pathline customers um in the past. So just curious um how you're seeing that Dynamic play out? Thanks.

Mike Matson: And then just on the non-clinical business, I mean, given the steep declines we're seeing now. I mean, would it would it be possible to exit that business? Is there some kind of synergies with the the clinical side? And then, you know, what would that, you know, how profitable is that part of the business? Or is it maybe an issue where, you know, more profitable than the clinical side? And then, you know, you'd be giving it would be hitting the bottom line too hard if you were to exit it? Yeah, thanks again for the follow-up, Mike.

Thank you.

Thank you. Your next question is coming from David Westenburg from Piper Sandler David Your line is live. Please go ahead.

Thank you for taking the question. So I just wanted to talk about the 10% volume growth and that was organic I believe.

And can you talk about what that might mean for share gains and versus.

Tony Zook: Are there synergies across the lines? The answer for the operations team is yes, there are opportunities for that. But I think the bigger question is, are we committed to the space, right? And I can tell you that we are. We do believe in the space. It is of strategic value to us. It provides the opportunity for us to identify and to validate biomarkers early. It provides the possibility and the development of companion diagnostics. It keeps us at the forefront of emerging technologies so that we can stay not just current, but a step ahead of where we want to take our own activities.

The market can you give us any context to what historical volume growth is in the market help us really evaluate.

The overall strength in the business.

Yes.

Well I would say first and foremost as you rightfully note the the growth was 10%.

Sure.

Sure, on behalf of to sort that and and the warrant can jump in anytime. Um, as far as the integration and the intended results versus actual, we are right on plan with the path line integration, the revenues were right in line with our expectations. Um, and so we feel very, very good about the, the shape of that acquisition and the shape of the business. Um, as you rightfully say, you know, it's not just a, uh, a business benefit relative to pathline alone. There was strategic value associated with the acquisition. We saw the opportunity to enhance our footprint and therefore, our speed of delivery to key customers and in in certain segments of our Market in the Northeast. And so it is our plan to continue to drive the current path line business. But as well. Take advantage of our more in-depth portfolio and bring in Gs products up.

Across our business, we have made good growth across all the various modality. So we continue.

A storyline that while our focus has been in Ngls and making sure that we grow that important segment of our business in fact across all of our modalities. We continue to make great progress and we see share gains across all the modalities and so it's quite a positive for us moving forward.

Warren Stone: It also does play a role, Mike, in accelerating the launch of new products, right? You don't have the same reimbursement hurdles in that space that you might across other parts of the business. So we believe in the pharma space over time, that it does help create value. But I also need to be reflective of the short-term impact to that. And we have adjusted our revenue lines there. And I do not personally anticipate that these changes in the environment are going to subside anytime soon. And we reflected that in our business plan movement.

Through into the Northeast with greater rigor in speed. Um, that was always intended to, uh, take place in the latter half of this year. Would that benefit be more realized in 2026? Then, of course, we will do everything in our power to pull as much of that forward as possible. Um, and I'll go to Warren if you want to add some additional color. Yeah, thanks, Dan. I think you kept most of the key points. I think one of the key elements for us.

As you also rightfully you have seen in the earnings release. It is also a record high volumes for us across the business and so for US we see the opportunity to continue to grow volume, we do see the opportunity to grow share in our key segments.

And that is what we are focused and Don and I would say if you look at it from a modality perspective, we're seeing growth rates, depending on the modality and the two to 3% to 5% range and I would say kind of across the board.

Warren Stone: Yeah, and I would add to that, I think, you know, we still have excess capacity, you know, in our footprint, as well as continuing, as we've talked about, our LIMS integration, which will allow us to increase our operating efficiencies with our pharma business as well. We don't break it out separately now, but we used to break out advanced diagnostics previously in prior periods, and it had a lower margin profile overall than the company. But as we look at excess capacity, you know, the business development and R&D opportunities, as Tony spoke about, and then the LIMS work, we still think it's going to be a viable business for us going forward, and we think there will be, you know, a plot going out at some point in the future, which we can build upon from a growth standpoint.

Growing significantly faster than that.

I would build on that just from a commercial execution perspective, and I think the development from a volume perspective as test Mitsui, a strong commercial strategy, well executed and coming back to the fact that we have on <unk> business managers that are looking at the pathology business and the oncology sales specialist looking more at the community oncologists from it.

To really enable this capability in the Northeast was to further validate test within this lab and that was always planned to take place in the second quarter. And again just to remind everybody we closed this this acquisition the early part of of the second quarter as well. So we've actually concluded the validation requirements for these additional tests that we wanted to move into the Northeast to round out. Uh the portfolio that's required in that lab and now we are actively addressing sort of these opportunities to drive additional share of wallet and and pull through um, the the sort of opportunity funnel looks robust and certainly expect to see many of those come to fruition in the second half of the year. And as Tony said, that would be an upside for us in the second half and certainly saying that would drive material value for us in 2026 and Beyond.

Thank you.

Therapy selection point of view.

That Randy drives towards providing a solution to these ordering physicians and although we do prioritize certain products, it's very much around providing a holistic solution across their needs and this is what's driving the incremental volume across all modalities and we see growth.

Thank you. Your next question is coming from David westenberg from Piper Sandler, David. Your line is live and please go ahead.

Greater than market as Jeff and Tony said at each of the modalities that we do over index on <unk> because of the desire to move to the right into therapy selection as well and we do that too sort of incentive compensation and other focusing mechanism, but it really is the testing of a strong commercial strategy being well executed this seeing.

Mike Matson: Okay, understand, thank you.

Mark Massaro: Your next question is coming from Mark Massaro from VTIG. Mark, your line is live. Please go ahead.

Mark Massaro: Hey guys, this is Vidyun from Mark. Thanks for taking the questions. So maybe just more on Pathline, just help us understand how the contribution in the quarter was tracking relative to your internal expectations. And then I know you've cited an intended benefit of cross selling the broader portfolio with Pathline customers in the past. So just curious how you're seeing that dynamic play out. Sure, I'd be happy to start that and Warren can jump in any time. As far as the integration and the intended results versus actual, we are right on plan with the Pathline integration.

Thank you for taking the question. So, I actually wanted to, um, talk about the, the 10%, uh, volume growth. And that was organic, I believe. Um, and can you talk about what that might mean for share gains and, and, uh, versus um, um, the market can you give us any context to, what historical volume growth is in the market? Help us, you know, really evaluate. Um, you you the, um, the overall strength in the business.

This volume growth across all my data and I think saying 20.

23% Ngls growth without our liquid biopsy product is again, continuing to see very strong growth at or above market growth there and now adding what we believed to be a very new and important products.

Well, I I would say first and foremost is you, you rightfully not the, the growth was 10%. Um,

To help drive more growth in the back half of the year.

Perfect and then if we I mean, I know youre, not giving second 2026 guidance, but if you can maybe talk long term Tony about how you think about operating margins in 2006 and beyond is there any kind of.

Tony Zook: The revenues were right in line with our expectations and so we feel very, very good about the shape of that acquisition and the shape of the business. As you rightfully say, you know, it's not just a business benefit relative to Pathline alone. There was strategic value associated with the acquisition. We saw the opportunity to enhance our footprint and therefore our speed of delivery to key customers in certain segments of our market in the Northeast. And so it is our plan to continue to drive the current Pathline business but as well take advantage of our more in-depth portfolio and bring NGS products up and through into the Northeast with greater rigor and speed.

Planning on growing EBITDA faster than revenue in the years out is that does that kind of the mission here and then back to Jeff can you talk about some of this cash flow and operating margin seasonality that you see in the business and I will take it from there I think some are getting there.

Well I will obviously wait for 2006 to talk about 'twenty six.

We will do in February but to just give you a sense over the over the longer term plan do we still see that there is operating leverage for us as an organization and the answer to that is yes.

We will continue to make the right investments in our operations sites.

Across our business. We have made good growth across all the various modalities. So we continue uh uh uh a storyline that um, while our Focus has been in NGS and making sure that we grow that important segment of our business. In fact, across all of our modalities we continue to make great progress and we see share gains across all the modalities. And so it's quite a positive for us. You also, it's also record high volumes for us, across the business. And so, you know, for us, we see the opportunity to continue to grow volume. We do see the opportunity to grow share in our key segments. Um, and that is what we are focused in doing. And I would say, if you look at it from a modality perspective, you know, we're seeing growth rates depend animal modality and the, and the 2 to 3 to 5% range and I would say, kind of a cross the board. Uh we're growing significantly faster than that. Yeah maybe I I build on that just from a a commercial execution perspective. And I think the development from a volume perspective is test me to a

We have made a really good progress with the <unk> project and we look forward to having a one common limb system that we can retire eight legacy systems. There are opportunities for us to do the same thing.

Warren Stone: That was always intended to take place in the latter half of this year with that benefit being more realized in 2026. And of course, we will do everything in our power to pull as much of that forward as possible.

And a number of different areas through automation through digital pathology.

Warren Stone: And I'll look to Warren if you want to add some additional color. Yeah, thanks Dan. I think you covered most of the key points. I think one of the key elements for us to really enable this capability in the Northeast was to further validate tests within this lab. And that was always planned to take place in the second quarter. And again, just to remind everybody, we closed this acquisition the early part of the second quarter as well. So we've actually concluded the validation requirements for these additional tests that we wanted to move into the Northeast to round out the portfolio that's required in that lab.

a strong commercial strategy while executed and you know, coming back to the fact that we have our territory business managers that are looking at the pathology business and the oncology sales specialist looking more at the uh Community oncologists from a therapy selection point of view, um, that really drives towards providing a solution to these ordering positions and and although we do

So we do expect that we can increase efficiencies and effectiveness in our margins.

That in turn will lead to solid growth over time.

We also believe that there are going to be some midterm opportunities for us It will talk about in more detail that we can create more value for the company.

We have a strong financial discipline and been in the company, we're going to build on that and we do see plenty of opportunities for us to continue to cost reduce find efficiencies and improve margins, yes, I would add to that and I would still characterize we think we're in early innings of really capitalizing on both.

Warren Stone: And now we are actively addressing sort of these opportunities to drive additional share of wallets and pull through. The sort of opportunity funnel looks robust and certainly expect to see many of those come to fruition in the second half of the year. And as Tony said, that would be an upside for us in the second half and certainly something that would drive material value for us in 2026 and beyond. Thank you.

The <unk> integration as well as.

Investing in automation, it and really think we have an opportunity to drive operating efficiencies. There and then from a cash flow perspective, generally Q1 is our biggest cash burn and that played out again this year and we start building from there. So we had a very strong cash flow quarter, we're actually.

Each of the modalities. But we do over index on NGS, because of the desire to move to the right into therapy selection uh as well. And and we do that through sort of incentive compensation and other focusing mechanisms, but it really is the testing of a strong commercial strategy being well, executed, they're seeing this volume growth across all madata. And I think seeing, you know, 23% in Gs growth without our liquid biopsy product is again continuing to perceive very strong growth there above market growth there. And now adding what we believe to be a very new and important product that we is going to help drive more growth in the back half of the year.

David Westenberg: Your next question is coming from David Westenberg from Piper Sandler.

Free cash flow positive this quarter and as I said in my prepared remarks cash flow from operations was up over 40% in the second quarter.

David Westenberg: David, your line is live and please go ahead. Thank you for taking the question. So I actually wanted to talk about the 10% volume growth, and that was organic, I believe. Can you talk about what that might mean for share gains versus the market? Can you give us any context to what historical volume growth is in the market? Help us, you know, really evaluate the overall strength in the business. Well, I would say, first and foremost, as you rightfully note, the growth was 10%. Across our business, we have made good growth across all the various modalities.

They are very focused on revenue cycle management, and making sure we're collecting what what.

What we generate from a revenue perspective, and expect that cash balance will build as the year progresses with the normal seasonality with the back half growth or expecting that we've seen historically.

Perfect. Um, and then, as we um, I mean, I know you're not giving second, uh, 2026 guidance but if you can maybe talk, uh, long term Tony about how you think about operating margins in 26 and Beyond, is there any kind of um, planning on growing ebida faster than revenue? And in the Years out is that is that kind of the the mission here and then back to Jeff, can you talk about some of this cash flow and operating margin seasonality that you kind of see in the business and I'll take it from there. Thank you. If some or get off from there. Thank you.

Thank you.

Thank you. Your next question is coming from Dan Brennan from TD Securities. Dan. Your line is live. Please go ahead.

Great. Thank you. Thanks for the questions maybe just one start on the non clinical business you know it's been a.

Well I I I will obviously wait for 26 to talk about 26 um which we will do in February but to just give you a sense over the over the the longer term plan. Do we still see that there is operating leverage for us as an organization. You answer to that is yes. Um, we will continue to make the right investments in our operation.

Continued weak spot for you I think it was down I think you said, 26% in the second quarter I know you don't break out guidance, but just the.

Tony Zook: So we continue a storyline that, while our focus has been in NGS and making sure that we grow that important segment of our business, in fact, across all of our modalities, we continue to make great progress, and we see share gains across all the modalities. And so it's quite a positive for us moving forward. As you also rightfully have seen in the earnings release, it's also record high volumes for us across the business. And so for us, we see the opportunity to continue to grow volume, we do see the opportunity to grow share in our key segments, and that is what we are focused in doing.

Ideally remove and minimize the risk that kind of more shortfall here.

Depressed results in the back half of the year end or the stock is down 40% 50%.

Can you help us frame any sense of how we think about the back half of year kind of what's baked into the new guidance we.

We punching down 50%, we would get to the midpoint of your range not changing our clinical assumptions I'm. Just wondering if you can help us do that bridge.

Yes, I think.

On the pharma side I would expect a similar performance as we had in the first half of the year, we generally see a little bit stronger performance in the fourth quarter.

Tony Zook: And I would say, as you look at it from a modality perspective, we're seeing growth rates, depending on the modality, in the 2% to 3% to 5% range. And I would say kind of across the board, we're growing significantly faster than that.

Uh huh.

Data business, our <unk> business, so I would expect.

That as well, but.

Pretty pretty consistent with the first half.

Warren Stone: Maybe I want to build on that just from a commercial execution perspective, and I think the development from a volume perspective is testament to a strong commercial strategy while executed. And coming back to the fact that we have our territory business managers that are looking at the pathology business, and the oncology sales specialist looking more at the community oncologist from a therapy selection point of view, that really drives towards providing a solution to these ordering positions. And although we do prioritize certain products, it's very much around providing a holistic solution across their needs. And this is what's driving the incremental volume across all modalities.

With some upside in our own ods business in the fourth quarter is how I'd characterize.

Sites. Um, you know, we have made a really good progress with the limbs project and uh we look forward to having a, you know, 1 common limb system and we can retire 8 Legacy systems. There are opportunities for us to do the same thing, uh, and a number of different areas through automation through digital pathology. Um, so we do expect that we can increase efficiencies and Effectiveness in our margins, uh, and that in turn will lead to solid growth over time. Um, and we also believe that there are going to be some midterm opportunities for us that we'll talk about in more detail that we can create more value. Uh, for the company to build, we have a a strong financial discipline and that in the company. Uh, we're going to build on that. And we do see plenty of opportunities for us, to continue to uh cost reduced fine, efficiencies and improved markets. Yeah. And I, I would add to that and I would still characterize. We think we're in an early inning to really capitalizing on both, uh, you know, the limbs integration as well as, uh,

What we're contemplating.

Okay, and then on the penetration side could you and I'm sorry, if I missed this did you give an update on where reimbursement stands.

And I know you talked about delayed the launch due to learnings from the EAP. So could you share it.

Any insights on that.

Dan what I would tell you is that we are in ongoing conversations with multi X.

And we will share the final outcomes of those that we are confident in our path forward towards reimbursement and Thats why we are launching tomorrow.

You know, investing in Automation and really think we have an opportunity to drive, you know, operating efficiencies there. And then from a cash flow perspective, you know, generally q1 is our biggest cash burn and that's played out again. Uh, this year, uh, and we started building, uh, from there. So, we had a very strong, you know, cash flow report and we actually pre-task flow positive, uh, this quarter and, you know, as I said in my prepared remarks cash flow from operations was up over 40% and in the second quarter, uh, we are still

Warren Stone: And we're seeing growth greater than market, as Jeff and Tony said, against each of the modalities. But we do over-index on NGS because of the desire to move to the right into therapy selection as well. And we do that through sort of incentive compensation and other focusing mechanisms. But it really is the testimony of a strong commercial strategy being well executed. That's seeing this volume growth across all modalities. And I think seeing 23 percent NGS growth without our liquid biopsy product is, again, continuing to see very strong growth there, above market growth there, and now adding what we believe to be a very new and important product.

And anything on the learnings in terms of the EAP, Tony and did you guys break out how to think about kind of what you've put in the contribution for the back half of year ideally, it's kind of modest to give you room for beats, but just kind of wondering on those two factors.

Already focused on revenue cycle management, uh, and making sure we're collecting, you know what, what we generate from a revenue perspective. And expect that cash balance will build, as, as the year progresses, with with the normal seasonality, with the back half growth. We're expecting that that we've seen historically.

Thank you.

Yes, we havent given a specific forecast for penetration in the second half of the year.

Thank you. Your next question is coming from Dan Brennan, from TD Securities. Dan your line is live. Please go ahead.

Relative to the learnings Dan I think we found that there was opportunity for us to improve the profile of the product.

Great, thank you. Uh, thanks for the question. Um, maybe just 1 start on the non-clinical business, you know, it's been a

Excited by it and we will have a very low risk profile, we have verified a really exciting turnaround time that our customers are going to welcome and we believe that we have a very comprehensive tests that we bring forward and so for US. It was the right decision to take and we feel more confident about when pantries hits the market but.

Kind of continued weak spot for you. I think it was down. I think you said 26% in the second quarter. I know you don't break out guidance but just to

Warren Stone: is going to help drive more growth in the back half. Perfect.

Ideally remove or minimize the risk that, you know, kind of more shortfalls here.

David Westenberg: And then is we I mean, I know you're not giving second 2026 guidance, but if you can maybe talk long term, Tony, about how you think about operating margins in 26 and beyond. Is there any kind of planning on growing EBITDA faster than revenue in the years out? Is that is that kind of the mission here?

As far as specific ramp ups I don't think were going to be talking about that correctly.

I would just add it's a.

New products.

Incorporating new product.

Jeff Sherman: And then back to Jeff, can you talk about some of this cash flow and operating margin seasonality that you kind of see in the business? And I'll take it from there. Thank you so much, Jeff Nair. Thank you.

Yes.

And then maybe just adding I think once we.

Kind of, you know, depressed results in the back half of the year end or the stock is is is down 40. 50% like how do can can you help us frame? Any sense of how we think about the back half year, kind of, what's baked into the new guidance, you know, like a free punching down. 50% we would get to the midpoint of your range. Not changing our clinical assumptions. I'm just wondering if you can help us do that bridge.

The revised EAP that we went live with February is probably a month ago or so.

The demand that we saw with the revised target product profile, which was significant and very encouraging in terms of what we expect to see post that commercial launch tomorrow.

Jeff Sherman: Well, I will obviously wait for 26 to talk about 26, which we will do in February. But to just give you a sense over the over the longer term plan, do we still see that there is operating leverage for us as an organization? The answer to that is yes. We will continue to make the right investments in our operations sites. You know, we have made a really good progress with the LIMS project, and we look forward to having a one common LIMS system that we can retire eight legacy systems. There are opportunities for us to do the same thing in a number of different areas to automation through digital pathology.

Got it and I know there was one question on MRV.

Yeah, I think, you know, on on, on the Pharma side, I would expect a similar performance as we had in the first half of the year. We generally see a little bit stronger performance in the fourth quarter, uh, in our, uh, Data Business. Our ODS business. So I would expect, uh, expect that as well, but but, you know, pretty pretty consistent with the first half, uh, with with some upside.

I know you discussed natera looking to have a jury trial could could you just remind us would you mind just kind of zooming out since the next quarter in the back half of the year, we're going to get some of these key events.

And I already ODS business in the fourth quarter is how I characterize. You know what? What we're contemplating

Your <unk> strategy.

They're not you can kind of launch with your existing platform can move on just kind of could you just reframe how to think about the various outcomes as we move into the back half of the year on M&A.

Okay. And and then and then on the pain, Tracer side, do you? Um, and I'm sorry if I missed this, did you give an update on where reimbursement stands?

And I know you talked about, you delayed the launch due to learning from the EAP. So could you share?

Investment.

Well again, what I would tell you there are some things that are more concrete than others right on what we will definitely be doing in the second half of the year as our adaptive partnership with heme and Marquis.

Tony Zook: So we do expect that we can increase efficiencies and effectiveness in our margins, and that in turn will lead to solid growth over time.

Jeff Sherman: And we also believe that there are going to be some midterm opportunities for us that we'll talk about in more detail, that we can create more value for the company. So we have a strong financial discipline embedded in the company. We're going to build on that. And we do see plenty of opportunities for us to continue to cost reduce, find efficiencies and improve margins.

Then what I would tell you is that we are an online conversations with multi X, um, and we will share, you know, the final outcomes of those. We are confident in our path forward towards reimbursement and that's why we are launching uh tomorrow.

We are in the early days of a pilot with adaptive we want to make sure that the partnership is seamless to our customers and that we've tested everything end to end. So that is going to happen. We are working through those pilots now and we look forward to a more competitive launch when both companies are satisfied that our.

Got and and anything on the learnings in terms of the EAP Tony and and did you guys break out how to think about, kind of what you put in the contribution for the back half year? Uh, ideally, it's kind of modest to give you room for Beats but just kind of wandering on those 2 factors.

Jeff Sherman: Yeah, I would add to that and I would still characterize. We think we're in the early innings of really capitalizing on both the LIMS integration as well as, investing in automation and really think we have an opportunity to drive operating efficiencies there.

<unk> see this as a great partnership and that should be closer to the back half year.

<unk> two.

The radar litigation I would tell you that right now the trial is slated for October.

I can't speculate on what the results will be or when they will be.

Jeff Sherman: And then from a cash flow perspective, generally Q1 is our biggest cash burn and that played out again this year and we started building from there. So we had a very strong cash flow quarter. We're actually pre cash flow positive this quarter. And as I said in my prepared remarks, cash flow from operations was up over 40% in the second quarter. We are still very focused on revenue cycle management and making sure we're collecting what we generate from a revenue perspective and expect that cash balance will build as the year progresses with the normal seasonality with the back half growth we're expecting that we've seen historically.

I can tell you that we had done all the back office work in preparation to be able to launch so our bridging work and everything has been submitted.

So all of that is on track I would remind everyone that we didn't have any of those radar revenues in our guide.

In our plan. So if we are successful there that represents upside.

And another area that we are doing Dan we are investing in next generation <unk> with Andrew and his team. We said that this would be a year, where we're really spending those out 26 would be a year of more active product development and we look forward to those market opportunities in 2007 and beyond so that's kind of what I can give to you.

Yeah, we we have given a specific forecast for pant, Tracer in the second half of the year, um, relative to the learnings Dan. I think we found that there was opportunity for us to improve the profile of the product, um, we're excited by it and we'll have, you know, a very low Q ands profile. We have verified a really exciting turnaround time that our customers are going to welcome. Uh, and we believe that we have a very comprehensive tests that we bring forward. And so for us it was the right decision to take uh and we feel more confident about when pant, Tracer hits the market but as far as specific ramped up, so I don't think we're going to be talking about that directly on the other other than I would just add, you know, it's a new product. So it it, it will incorporate a new product brand. Yeah, yeah. And then, maybe just adding to that, I think once we this sort of the revised EAP that we went live with failure is probably a month ago or so. The the demand that we saw with the revised Target product profile was was significant and very and carried.

Ing in terms of what we expect to see post commercial launch tomorrow.

Jeff Sherman: Thank you.

Are you relative to MRV landscape types.

Dan Brennan: Your next question is coming from Dan Brennan from TD Securities. Dan, your line is live. Please go ahead. Great, thank you. Thanks for the questions.

Perfect great. Thanks, so much.

Youre welcome Tim.

Thank you. Your next question is coming from Tycho Peterson from Jefferies <unk> Co. Your line is live. Please go ahead.

Tony Zook: Maybe just one to start on the non-clinical business, you know, it's been a kind of continued weak spot for you. I think it was down, I think you said 26% in the second quarter. I know you don't break out guidance, but just to ideally remove or minimize the risk that, you know, kind of more shortfalls here, kind of, you know, depressed results in the back half of the year end or the stock. Is down 40, 50%? Like, can you help us frame any sense of how we think about the back half of the year, kind of what's baked into the new guidance?

Hi team this is Lauren on for Tycho.

A quick one from me going back to the <unk> growth you guys talked about how you achieved 23% regardless of the delay in the commercial launch with pantry, Sir could you talk a little bit about how much of that is being driven by testing. This mixed shift first to market expansion and kind of how sustainable that cadences into 2026.

Got it and I know there was 1 question on mrd. Um, I know you discussed, you know, Nera, looking to have a jury trial. Could could you just remind us? Would you mind just kind of zooming out since the next quarter in the back? Half of the year, we're going to get some of these key events on your mrd strategy. You know, whether or not you can kind of launched with your existing platform. I have to move on, just kind of. Could you just reframe H? How to think about the various outcomes as we move into the back half of the rmd?

Tony Zook: You know, like if we punch in down 50%, we would get to the mid-20 year range, not changing our clinical assumptions. I'm just wondering if you can help us do that bridge.

The majority of it is true market expansion I mean naturally there is mixed benefit and I think it's common knowledge that the ngls as a higher A&P than the rest of our portfolio, but if you look at true sort of volume growth.

That remains significantly higher than what we experiencing from.

From a model would be seen from a market growth perspective, and really again it comes back to the commercial strategy, where we have our dedicated sales team of oncology sales specialist to spend the majority of their time focused on the sale of NGL related products within the therapy selection.

Well again, what I would tell you. Um, there are some things that are more concrete than others, right? Um, what we will definitely be doing uh, in the second half of the year is our adaptive partnership with team and marketing. Uh we are in the early days of a pilot with adaptive, we want to make sure that the partnership is seamless to our customers and that we've tested everything end to end. So that is um, going to happen. We are working through those Pilots now and we look forward to a more complete launch. When both companies are satisfied that our customers, see this as a, a great partnership, and that should be closer to the back half of the year.

Tony Zook: Okay, and then on the Pantracer side, did you, and I'm sorry if I missed this, did you give an update on where reimbursement stands? And I know you talked about you delayed the launch due to learning from the EAP, so could you share any insights from that? Dan, what I would tell you is that we are in ongoing conversations with Multiex and we will share, you know, the final outcomes of those. We are confident in our path forward towards reimbursement, and that's why we are launching tomorrow. And anything on the learnings in terms of the EAP, Tony, and did you guys break out how to think about kind of what you've put in the contribution for the back half year?

Part of the business and again, we are gaining traction in this space and this is really what's driving the share gains that we're seeing and we believe the addition of pantry illiquid as of Tomorrow will further accentuate that.

Okay.

Great. Thank you.

Okay.

Thank you.

Next question is coming from Michael <unk> from Bank of America. Michael Your line is live. Please go ahead.

Relative to um the radar litigation I would tell you that, you know, right now the trial is slated for October. Um, I can't speculate on what the results will be or when they will be. Um, I can tell you that, we have done all the back office work in preparation to be able to launch. So our bridging work and everything has been submitted. Um, so all of that is on track. I would remind everyone that we didn't have any of those radar revenues in our guide, uh, nor in our plan. So, you know, if we are successful there, that represents upside

Alright, Thanks for squeezing me in guys I got just a couple of small follow ups on topics that people touched on before.

Really rapid fire one is on pantry, so just kind of confirming that.

Tony Zook: Ideally, it's kind of modest to give you room for beats, but just kind of wondering on those two factors.

No change to your plan to ramp or planned execution in the first couple of months or first couple of quarters out of the gate.

Tony Zook: Yeah, we haven't given a specific forecast for Pantracer in the second half of the year. Relative to the learnings, Dan, I think we found that there was opportunity for us to improve the profile of the product. We're excited by it. We'll have a very low Q&S profile. We have verified a really exciting turnaround time that our customers are going to welcome. And we believe that we have a very comprehensive test that we bring forward. And so for us, it was the right decision to take, and we feel more confident about when Pantracer hits the market.

The delay, but the plan going forward is Hussein and nothing's really changed on that.

And another area that we are doing. Then we are investing in Next Generation mrd with Andrew and his team. We said that, you know, this would be a year where we're really specking. Those out. 26 would be a year of more active product development and we look forward to those Market opportunities in 27 and Beyond. So if that's kind of what I can give to you relative to mrd landscape times,

Perfect. Great. Thanks.

You're welcome again.

Yes.

Point of launch the plan remains the same but of course that point of launch had experienced about a three month delay okay. Okay, just making sure.

Thank you. Your next question is coming from to Peterson. From Jeffrey's. Take out. Your line is live. Please go ahead.

On the pharma services I mean.

Totally hear you on what Youre seeing in the end market and not.

Not surprising given what we've seen elsewhere, but still the results have lagged some of the others in the space for a little bit and we just haven't seen the same extent of weakness.

Tony Zook: But as far as specific ramp ups, I don't think we're going to be talking about that directly. Other than that, I would just add, you know, it's a new product, so it will incorporate a new product branch. Yeah. And Dan, maybe just adding to I think once we sort of the revised EAP that we went live with probably a month ago or so, the demand that we saw with the revised target product profile was significant and very encouraging in terms of what we expect to see post-commercial launch tomorrow. Got it.

There's a little bit more protracted. So I was just wondering if you could comment on your competitive positioning there. It is a relatively crowded market and there is more and more players offering some of these services. So could you just sort of annualize your portfolio often maybe there's something there. But then you are missing on pharma services.

Hi team. This is Lauren on for Tau. Um, a quick one from me, going back to the NGS growth. Uh, you guys talked about how you achieved 23% regardless of the delay in the commercial launch, um, with PanTracer. Could you talk a little bit about how much of that is being driven by test mix shift versus true market expansion and kind of how sustainable that cadence is into 2026? Thanks.

On the commercial side.

Yeah relative to pharma I think as I had mentioned earlier I think portfolio does play a role our inability to sell radar certainly led to radar one point <unk> was certainly led to some of this falloff in revenue in our <unk> tablet kind of a launch point within those discussions I think is real.

Tony Zook: And I know there was one question on MRD. I know you discussed, you know, Natera looking to have a jury trial. Could you just remind us, would you mind just kind of zooming out since the next quarter and the back half of the year, we're going to get some of these key events on your MRD strategy, you know, whether or not you can kind of launch with your existing platform and have to move on. Just kind of, could you just reframe how to think about the various outcomes as we move into the back half of the year on MRD?

And so portfolio does have a role and that's why we were excited to bring <unk> into the marketplace, but Michael we also recognize that these are long selling cycles and so while there might be some early signs there that look encouraging.

I don't believe that theyre going to meaningfully impact our shape for the short term.

Within the therapy selection uh uh part of the business. And again we're gaining Traction in this space. And this is really what's driving these share gains that we are seeing and we believe the addition of pantry a liquid as of tomorrow will further accentuate that

Tony Zook: Well, again, what I would tell you, there are some things that are more concrete than others, right? What we will definitely be doing in the second half of the year is our adaptive partnership with HEME MRT. We are in the early days of a pilot with adaptive. We want to make sure that the partnership is seamless to our customers and that we've tested everything end-to-end. So that is going to happen. We are working through those pilots now, and we look forward to a more complete launch when both companies are satisfied that our customers see this as a great partnership.

And as you talk with other companies, Yes, I would tell you that there will be differences by companies a lot and so on what are the services that they are bringing forward some companies have.

great. Thank you.

Thank you. Your next question is coming from Michael rice from Bank of America. Michael, your line live, please, go ahead.

Some companies do different types of mixes I can only react to our portfolio and in our portfolio.

<unk> risks in that form of business this year and I don't anticipate that.

We're going to see any leveraging or any a deleveraging of those issues for the remainder of this year and into 2026.

Okay. Thanks, and then last one if I can squeeze one more in would be on the cash balance and just sort of future uses of cash I know you use the $200 million intra quarter to pay down the protocol and confidence of you previously talked about but.

Tony Zook: And that should be closer to the back half of the year. Relative to the radar mitigation, I would tell you that, you know, right now the trial is slated for October. I can't speculate on what the results will be or when they will be. I can tell you that we have done all the back office work in preparation to be able to launch. So our bridging work and everything has been submitted. So all of that is on track. I would remind everyone that we didn't have any of those radar revenues in our guide nor in our plan.

Right. Uh thanks for squeezing in guys. I got um just a couple of small follow-ups on topics that people touched on before. Um so hopefully really rapid fire 1 is um on Pantry. So just kind of confirming that no change to your plan to ramp or plant execution. The first couple months of first, couple quarters out of the gate. You know, yes, there's a delay but the the plan going forward is the same and nothing's really changed on that. Um

You still got a sizable chunk of economy going forward.

Yeah, from the point of launch, the plan remains the same, but of course that point of launch will experience about a 3-month delay.

This revised fiscal year guide I know.

There is a near term versus long term dynamics, just talk us through cash balance going forward just confidence in the runway for the next couple of years as you get to that.

Our remaining to be $50 million on the content. Thanks.

Yes.

We expect that that.

That will be generating free cash flow next year is still in the cash balance about grow consistent with our earnings growth over the plan. So.

Tony Zook: So, you know, if we are successful there, that represents upside.

Okay. Okay. Okay, just just making sure um then on the on the pharmacy Services I mean um totally hear you on on what you're seeing In the End Market and um, yeah, not surprising given what we've seen elsewhere. It's still the results have lagged, uh, some of the others in the space a little bit. And we just haven't seen the same extent of weakness and it is a little bit more protracted. So I was just wondering if you could comment on your competitive positioning, there it is, the relatively crowded market and there's 1 more players offering some of these services. So

Tony Zook: And another area that we are doing, Dan, we are investing in next generation MRD with Andrew and his team. We said that, you know, this would be a year where we're really speccing those out. Twenty six would be a year of more active product development. And we look forward to those market opportunities in twenty seven and beyond.

Certainly we have a lot of confidence that we will continue to delever as our earnings increase and we won't be in a very strong position in the future to deal with the 2028 converts.

Could you just sort of, you know, analyze your portfolio and your offerings? Maybe there's something there that that you're missing on Pharma Services um or maybe from the commercial side.

From a position of strength.

Dan Brennan: So that's kind of what I can give to you relative to MRD landscape. Perfect. Great. Thanks. You're welcome, Ken. Thank you.

Okay. Thanks.

Thanks, Michael.

Thank you. Your next question is coming from Mason Curico from Stephens, Inc. Mason. Your line is live. Please go ahead.

Tycho Peterson: Your next question is coming from Tycho Peterson from Jeffreys. Tycho, your line is live. Please go ahead.

Yeah.

Hey, guys.

Two from me here one it seems like path line may have outperformed slightly in the quarter and sorry, if I missed this in the first question, but could you update us on your expectations for <unk> revenue this year and whether it's the contribution built into guidance has changed at all.

Lauren: Hi team, this is Lauren on for Tyco. A quick one from me going back to the NGS growth. You guys talked about how you achieved 23% regardless of the delay in the commercial launch with Pantracer. Could you talk a little bit about how much of that is being driven by TESMIS mixed shift versus true market expansion and kind of how sustainable that cadence is into 2026? Thanks. The majority of it is true market expansion. I mean, naturally, there is mixed benefit, and it's common knowledge that the NGS has a higher AUP than the rest of our portfolio.

Yes, we haven't.

I would say top line I would say performed slightly ahead of our initial expectations, but we haven't we're not changing the overall guidance for pipeline.

Got it.

Then on the pharma side, how much visibility do you typically have in that business in terms of revenue flowing through at a single quarter or two quarters.

Yeah, uh relative to format. I think you know, as I had mentioned earlier, I think portfolio does play a role um, our inability to, you know, sell radar. Certainly led to radar 1.0 was certainly to some of this fall off in revenue and our inability to have a kind of a launch Point within those deductions. I think is real. And so, we're calling does have a role that's why we were excited to bring PTO into the marketplace. But Michael, we also recognize that these are long selling cycles. And so, while there might be some early signs there that look encouraging, you know, I don't believe that they're going to meaningfully impact our shape or the, you know, the short term. Um and as you talk with other companies. Yeah I I would tell you that there will be differences by companies. A lot, depends on what are the the services that they are bringing forward. Some companies, you know, have crows. Some companies do uh, different types of mixes. I can only react to our portfolio and in our portfolio, I see risk in that form of business is

Warren Stone: But if we look at true sort of volume growth, that remains significantly higher than what we're experiencing, or what we've seen from a market growth perspective. And really, again, this comes back to the commercial strategy, where we have our dedicated sales team of oncology sales specialists who spend the majority of their time focused on the sale of NGS-related products within the therapy selection part of the business. And again, we're gaining traction in this space, and this is really what's driving these share gains that we are seeing. And we believe the addition of Pantrase, a liquid, as of tomorrow, will further accentuate that.

Is that visibility change given the backdrop and could you just talk.

here and I don't anticipate um that we're going to see any leveraging or any a deleveraging of those issues uh for the remainder of this year and into 2026

To your confidence in that segment being adequately de risked this year.

Yes, I think I'll add to that I think it is a challenging space, especially with a big part of that business U S based and lots of uncertainty with regards to patient enrollment.

In the U S preclinical trials of net JD limit the line of site that we've got.

It's less than a code and believe it or not in terms. If you want a high degree of accuracy and it rapidly erodes. If you go beyond that and I think that's why we've taken a pretty conservative prudent approach to the forecast for the remainder of this year for the pharma services business.

Okay, thanks and and then the last 1 if I could squeeze in more and um, would be on the cash balance. And just sort of feature use of cash, I know you use the, the 200 million inch quarter to pay down the current part of the conflict as you previously talked about. But um, you still got a sizeable chunk of the condo bird going forward. Um, and now you've got this revised fiscal year, uh, guide. I know, you know, there's a near-term versus long term Dynamic just talk us through cash. Balance going forward, just confidence in the, in, the runway, for the next couple years. As you get to that, um, the remaining 350 million on the contract, thanks.

Warren Stone: Great, thank you. Thank you.

Michael Rison: Your next question is coming from Michael Rison from Bank of America. Michael, your line is live. Please go ahead. Great, thanks for squeezing me in guys. I got just a couple small follow ups on topics that people touched on before. So hopefully really rapid fire. One is on Pantrace. So just kind of confirming that no change to your planned ramp or planned execution the first couple months or first couple quarters out of the gate. You know, yes, there's a delay, but the plan going forward is the same and nothing's really changed on that. Thank you.

Got it thanks.

Thank you. Your next question is coming from Andrew Cooper from Raymond James Andrew Your line is live. Please go ahead.

Hey, everybody. Thanks for the question. So I was already asked and maybe just a little more kind of diving into the guidance mass I think Tony you talked about a $30 million revenue cut about two thirds or almost two thirds from pharma. So there's an incremental 10 or 12, it's coming from.

Yeah, we we we expect to uh, that that will be, you know, generating free cash flow next year. Still uh in the cash balance will grow consistent with our earnings growth over the plan. So um, certainly we have a lot of confidence that we will continue to be lever as our earnings increase. Uh, and we'll be in a very strong position in the future to deal with the 2028 converts, uh, you know, from a position of strength

Okay, thanks.

Thanks. Bye.

That's coming from clinical part, presumably pan tracer here, but I know thats not the full amount. So is there anything else explicit to think about in terms of that step back or is this hey, we really just want to de risk we want to make sure. We're in a good spot as the second half of the year plays out.

Tony Zook: Yeah, from point of launch, the plan remains the same.

Thank you. Your next question is coming from Mason Kuro from Stevens Inc. Mason, your line is live. Please go ahead.

Tony Zook: But of course, that point of launch has experienced about a three-month delay. Okay, okay, just making sure. Then on the final services, I mean, totally hear you on what you're seeing in the end market. And yeah, not surprising, given what we've seen elsewhere, but still, the results have lagged some of the others in the space a little bit. And we just haven't seen the same extent of weakness. And it is a little bit more protracted. So I was just wondering if you could comment on your competitive positioning there. It is a relatively crowded market, and there's more and more players offering some of these services.

Yes, I would say Andrew we certainly have heard and we want to make sure that we give you that.

With confidence what we believe we can deliver.

Hey guys, um, 2 for me here, 1, it seems like path line may have outperformed slightly in the quarter and sorry if I missed this in the first question. But could you update us on your expectations for path line revenue this year? And whether the contribution built into guidance has changed at all.

So that does factor in but I would tell you that the pharma as you mentioned rightfully. So the delay in pantries for liquid biopsy that does contribute to that remaining piece and then there was a slight mix effect that also would be there and I'll ask Jeff he wants to add.

Yeah, we haven't, you know, I would say Pathline, I would say performed, you know, slightly ahead of our initial expectations. But we haven't, you know, we're not changing, you know, the overall guidance for Pathway.

Tony Zook: So could you just sort of, you know, analyze your portfolio and offer maybe there's something there that you're missing on pharma services, or maybe from the commercial side? Yeah, relative to Pharma, I think, you know, as I had mentioned earlier, I think portfolio does play a role. Our inability to, you know, sell radar certainly led to radar 1.0 was certainly led to some of this fall off in revenue and our inability to have a kind of a launch point within those discussions, I think is real. And so portfolio does have a role. And that's why we were excited to bring Paletro into the marketplace.

Then in GFS the mix of testing in between.

Blood versus solid tumor can change from quarter to quarter, and so I think where we're seeing growth.

Could you just talk?

With some lower lower.

Modalities from permitting GSI, a lower growth modalities. So I think thats, just that mix element hard to predict quarter to quarter, but the overall growth growing 23%.

To your confidence in that segment being adequately de-risked this year.

Subject, where I see good growth there, but the mix will impact the revenue as well.

Tony Zook: But Michael, we also recognize that these are long selling cycles. And so while there might be some early signs there that look encouraging, you know, I don't believe that they're going to meaningfully impact our shape for their, you know, the short term. And as you talk with other companies, yeah, I would tell you that there will be differences by companies, a lot depends on what are the services that they are bringing forward. Some companies, you know, have CROs, some companies do different types of mixes, I can only react to our portfolio. And in our portfolio, I see risk in that form of business this year.

The rest of the year.

Okay. Thanks, and then maybe just lastly, I think Dan tried to ask on this but can you give us sort of an explicit what the updated pantries are LPX looks like relative to the initial product that you did in that first EAP is it the turnaround time that improved is it queuing assays at both and kind of how we.

Yeah, I think I think the it is a challenging space especially with a big part of our business us-based, and lots of uh, uncertainty with regards to Patient enrollment uh, within the us or clinical trials and that really limits the line of sight that we've got. So, you know, it it it's less than a quarter, believe it or not, in terms of, if you want a high degree of accuracy and it rapidly erod. If you go go beyond that and I think that's why we've taken a pretty conservative or prudent approach to the forecast for the remainder of this year, for the farmer Services business.

Think about.

Are you matching what's out there competitively do you feel like this latest iteration puts you ahead and if so on on what particular metrics.

Thank you. Your next question is coming from, Andrew Cooper. From Raymond James, Andrew. Your line is live. Please go ahead.

Yes.

Bold on that I think there was a number of benefits first of all we were able to lower our sort of input thresholds.

Tony Zook: And I don't anticipate that we're going to see any leveraging or any deleveraging of those issues for the remainder of this year and into 2026.

That allowed us to reduce the Q&A as TMP levels that we were experiencing in addition to that by optimizing the workflow we were able to accelerate turnaround times are able to offset a significant below that published turnaround time through the EAP, which was really encouraging and.

Michael Rison: Okay, thanks. And then the last one, if I could squeeze one more in, would be on cash balance and just sort of future uses of cash. I know you used the $200 million in your quarter to pay down the current part of the convert, as you previously talked about, but you still got a sizable chunk of the convert going forward. And now you've got this revised fiscal year guide. I know, you know, there's a near-term versus long-term dynamic. Could you just talk us through cash balance going forward, just confidence in the runway for the next couple years as you get to that, the remaining $350 million on the convert?

Hey everybody, thanks for the questions. A lot's already asked and maybe just a little more kind of diving into the guidance math, I think Tony. You talked about, you know, a 30 million Revenue cut about 2/3 or almost 2/3 from Pharma so there's an incremental 10 or 12 that's coming from

We also got feedback from select customers through the EAP that we were picking up certain genes that were being masked by a number set of peers or competitors out in the marketplace.

Not that's coming from Clinical part. Presumably pan Tracer but I know that's not the full amount. So is there anything else explicit to think about in terms of that step back? Or is this? Hey we really just want to de-risk. We want to make sure we're in a good spot as a second half of the Year plays out.

Very positive insight that came from that and as Tony said, we believe that the three months delay is going to be well within the long run.

Michael Rison: Thanks. Okay, thanks. Thank you, Michael.

Perfect I'll stop there. Thank you.

Thanks, Andrew.

Thank you. Your next question is coming from Jon Wilkin from Craig Hallum. John Your line is live. Please go ahead.

Got it. Thank you that's really quick but if my math is right. It looks like your volume preclinical, excluding Ngls and excluding pass line actually accelerated a little bit in the quarter. So just wondering if you could talk at all about what's driving that if theres anything underappreciated in that.

Yeah, I would say Andrew. We certainly, um, have heard, and we want to make sure that we give you, you know, with confidence, what we believe we can deliver. Um, and so, you know, that does factor in. But I would tell you that the Pharma, as you mentioned, rightfully so, the delay in pant, Tracer, liquid biopsy, that does contribute to that remaining piece. And then, there is a slight mix effect that also would be there. And now, as Jeffy wants to add in, yeah, I just within NGS, the mix of testing, you know, between, um, you know, blood versus solid tumor, it can change from quarter to quarter. And so I think where we're, you know, we're seeing growth in the with some lower lower.

Again, I think it comes back to.

Mason Carrico: Thank you. Your next question is coming from Mason Carrico from Stevens Inc. Mason, your line is live. Please go ahead. Hey guys, two for me here. One, it seems like Pathline may have outperformed slightly in the quarter, and sorry if I missed this in the first question, but could you update us on your expectations for Pathline revenue this year and whether the contribution built into guidance has changed at all? Yeah, we haven't, you know, I would say Pathline, I would say performed, you know, slightly ahead of our initial expectations, but we haven't, you know, we're not changing, you know, the overall guidance for Pathline.

A commercial strategy that is being effectively executed seeing the value of the commercial investments that we've made and some productivity ramps. We did speak about early in the first quarter. There was a few new client wins that we had recorded an LDC does that ramped through the last the last quarter or so.

Modalities from from the NGS side, uh, lower growth modalities. So I think that's just that mix element hard to predict quarter to quarter but, you know, with the overall growth growing 23%, um, you know, something we're going to see good growth there, but the mix will impact the revenue as well. Play out the rest of the year.

That covers the entire portfolio.

We are making available to us, which again I think speaks to the value of neogenomics and the breadth of portfolio.

Perfect. Thanks.

Thanks, guys.

Thank you. Your next question is coming from Puneet soda from Leerink your.

Okay, thanks and then maybe just lastly, I think Dan tried to ask on this, but can you give us sort of an explicit? What the updated? Pan, Tracer LBX. Looks like relative to the initial product that you you did. In the first EAP? Is it the turnaround time that improved? Is it qns, is it both? And kind of how we think about, you know, are you matching what's out there? Competitively. Do you feel like this latest iteration puts you ahead and if so on, uh,

Tony Zook: Got it. And then on the pharma side, how much visibility do you typically have in that business in terms of revenue flowing through? Is it a single quarter, two quarters? How has that visibility changed given the backdrop? And could you just talk? to your confidence in that segment being adequately de-risked this year. Yeah, I think I'll add to that. I think the it is a challenging space, especially with a big part of our business, U.S. based and lots of uncertainty with regards to patient enrollment within the U.S. botanical trials. And that really limits the line of sight that we've got.

On what particular metrics?

Your line is live please go ahead.

Yeah, Hi, guys. Thanks for the questions here so.

First one.

Could you elaborate a bit on the size of the oncology sales force now and.

How do you, what's your strategy and continuing to compete in that market.

How much of the NGL sales is sort of coming from the oncologist channel versus the pathologist channel, maybe just help us understand that largely because the competition here is only rising when it comes to therapy selection.

Warren Stone: So, you know, it's less than a quarter, believe it or not, in terms of if you want a high degree of accuracy and it rapidly erodes if you go beyond that. And I think that's why we've taken a pretty conservative or prudent approach to the forecast for the remainder of this year for the pharma services. Got it. Thanks.

Have one competitor that raised capital in the public offering you have liquid competitors that are now launching tissue in their existing incumbents. There. So just given all the landscape at that market, what's your NGL growth longer term and then could.

Yes, so I'll I'll build on that. I think there was a number of benefits. First of all, we were able to lower our sort of input threshold. Uh, that allowed us to reduce the q&as TMP levels that we were were experiencing in addition to that, by optimizing the workflow, we're able to accelerate turnaround time. So we're able to offer a significant below. The published turnaround time through the EAP, which was, was really encouraging. And, um, we also got feedback from select customers through the EAP. That we were picking up certain genes that were being missed by a number of sort of peers or competitors out in the marketplace. So really, a lot of very positive insights that came from that and as Tony said, we believe that the the 3 months delay is going to be well worth it in the long run.

Perfect, I'll stop there. Thank you.

Thanks Andrew.

Could you elaborate on the oncology sales force side.

Good morning wanted to just talk a little bit about size I would like to address the stickiness question. Yes, I think certainly we have executed against executive plan that we had spoken about in late last year beginning of this year.

Thank you. Your next question is coming from John Wildin from Craig Hallam. John, your line is live. Please go ahead.

Mason Carrico: Thank you.

Andrew Cooper: Your next question is coming from Andrew Cooper from Raymond James. Andrew, your line is live. Please go ahead. Yeah, I would say, Andrew, we certainly have heard, and we want to make sure that we give you, you know, with confidence, what we believe we can deliver. And so, you know, that does factor in, but I would tell you that the pharma, as you mentioned, rightfully so, the delay in Pantracer liquid biopsy, that does contribute to that remaining piece. And then there is a slight mix effect that also would be there.

<unk> sales team to roughly that 135 people and sort of 40% of those resources for within the oncology sales specialist side of things. The great majority of the growth that we're seeing actually is being driven by that sales team so coming from the therapy selection.

You guys are trying to keep this really quick, but if my math is right, it looks like your volume for clinical, excluding NGS and excluding Pathline, actually accelerated a little bit in the quarter. So, I'm just wondering if you could talk at all about what's driving that, if there's anything underappreciated in that.

And the business. There is some that comes through the pathology channel et cetera, but that's the minority portion and actually when we speak about the new products that contributed 20 feet standard of business in 2000 in Q2, and the majority of that business to its coming from.

This side of the business and despite the increasing competitive <unk>.

Again, I think it comes back to, um, a commercial strategy that's being effectively executed. Seeing the value of the commercial Investments that we've made and, and some productivity ramps we did speak about earlier in, in the first quarter that there was a few new client wins, uh, that we had, uh, recorded and obviously those are ramped through the the last, uh, last quarter or so. And that covers the entire portfolio that, uh, we're making available to us, which again, I think speaks to the value of, you know, genomics and the breadth of portfolio.

Lance Gate, we certainly continue to to penetrate effectively and we believe this sort of 25 or so percent growth rates that we put out there still is very much attainable, especially when we launch pantry liquid tomorrow.

Perfect. Thanks guys.

Jeff Sherman: And I'll ask Jeff if he wants to add anything. Within NGS, the mix of testing, you know, between, you know, blood versus solid tumor can change from quarter to quarter. And so I think where we're, you know, we're seeing growth in the, with some lower, lower. Modalities from the NGS side, lower growth modalities. So I think that's just that mixed element. Hard to predict quarter to quarter. But, you know, with the overall growth growing 23 percent, you know, I still think we're going to see good growth there. But the mix will impact the revenue as well as the rest.

Thank you. Your next question is coming from puny soda from lyric. Puny your line is live. Please go ahead.

I'd just build on one point you had mentioned that these are competitive markets and others that have invested in those markets and we are not naive to that we truly appreciate it with that.

The innovators do have a degree of stickiness, because they were able to get into the market first.

But I was at one of the recent conferences and I reminded people that there are other ways to create stickiness too.

That is we bring to the dance.

Broad portfolio, we meet customer needs across a number of different areas.

We continue to invest in those relationships and we continue to invest in making it easy to do business with Neogenomics and that also comes with a degree of stickiness and so we respect our competitors we respect their innovation, but we also.

Jeff Sherman: Okay, thanks.

Tony Zook: And then maybe just lastly, I think Dan tried to ask on this, but can you give us sort of an explicit what the updated Pantracer LBX looks like relative to the initial product that you did in that first EAP? Is it the turnaround time that improved? Is it QNS? Is it both? And kind of how we think about, you know, are you matching what's out there competitively? Do you feel like this latest iteration puts you ahead? And if so, on on what particular metrics?

Our hungry to get into those segments and we have demonstrated over time that if we have a competitive profile product that we bring to market. Even if it lags in time, we have been able to sufficiently grow those businesses and so we believe in the profile that we have with penetration in the penetration family and respect our competitors, but believe we can grow.

Yeah, hi guys. Um, thanks for the questions here. So, um, uh, first 1, um, could you elaborate a bit on the, the size of the oncology Salesforce now? And, um, how do you, you know, what's your strategy in in continuing to compete in that market? Um, how much of the NGS sales is sort of coming from the oncologist Channel versus the pathologist Channel, maybe just help us understand that and largely because, uh, the competition here is only, uh, Rising, uh, when it comes to therapy selection. Um, you have 1 competitor, that raised capital in the public offering. You have liquid competitors that are now launching tissue, and then there are existing incumbents there. So just giving all the landscape of that market. What's your NGS growth longer term? And then, um, uh, could you elaborate on the, the oncology Salesforce side?

Tony Zook: Yeah, so I'll build on that. I think there was a number of benefits. First of all, we were able to lower our sort of input threshold. That allowed us to reduce the Q&A TMP levels that we were experiencing. In addition to that, by optimizing the workflow, we were able to accelerate turnaround time. So we were able to offer a significant below the published turnaround time through the EAP, which was really encouraging. And we also got feedback from select customers through the EAP. That we were picking up certain genes that were being missed by a number of sort of pairs of competitors out in the marketplace.

In that environment, and then the focus on operational execution and turnaround time, continuing to improve as well I think.

Allowed us to grow and retain market share.

Got it that's helpful and then.

On the Opex side, if I could could you clarify if youre expecting and apologize if I missed this.

More. You want to just talk a little bit about side, I'd like to address this stickiness question as well. Yeah, I think, uh, so we have executed against the executive. The plan that we had spoken about, uh, in late last year, in the beginning of this year, uh, getting our sales team to roughly that 135 people and and sort of 40% of those resources for within the oncology sales, specialist side of things, the greater majority of the growth that we're seeing. Actually, is being driven by that sales team. So coming from

If youre expecting any opex cuts.

And the guide for this year and I don't know if you. If you can talk about next year yet.

Yeah.

Yes, we're all talking about next year, yet I think.

Tony Zook: So really a lot of very positive insights that came from that. And as Tony said, we believe that the three month delay is going to be well worth it in the long run. Perfect. I'll stop there. Thank you. Thanks, Kendra. Thank you.

We continue to achieve operating efficiencies and expect we will see some operating efficiencies in the back half of the year.

We have I'd say a high focus.

Continuing to see improvements there.

John Wilkin: Your next question is coming from John Wilkin from Craig Hallam. John, your line is live. Please go ahead. Yeah, I got to try and keep this really quick. But if my math is right, it looks like your your volume for clinical excluding NGS and excluding pathline actually accelerated a little bit in the quarter. So just wondering if you could talk at all about what's driving that, if there's anything underappreciated in that. Again, I think it comes back to a commercial strategy that's being effectively executed, seeing the value of the commercial investments that we've made and some productivity ramps.

Okay. Thank you.

The therapy selection, uh, side of the business. There is some that comes through the pathology Channel, Etc, but that's the minority portion. And actually, when we speak about these new products, that contribute to 23% of the business in, uh, in Q2, you know, the majority of that business too is coming from the OSS side of the the business. So, despite the increase in competitive, uh, landscape, we certainly continue to to penetrate effectively and and we believe this sort of 25 or so percent growth rate that we've put out there still is is very much attainable especially when we launched Pantry as a liquid tomorrow.

Thank you.

Thank you.

This does conclude today's question and answer session I would now like to turn the floor back to Tony for closing comments.

I would just like to thank everybody for joining us on the call I do appreciate the direct questions and the opportunity to.

Present, our results and as well our direction moving forward.

I'd like to remind everyone, though that we did do a pretty good job on that clinical side, we grew that business, 16%, we had a record quarter for volumes.

Warren Stone: We did speak about early in the first quarter that there was a few new client wins that we had recorded. And obviously, those have ramped through the last quarter or so. And that covers the entire portfolio that we're making available to us, which again, I think, speaks to the value of Neogenomics and their breadth of portfolio.

Really exciting NTS growth rate and we are poised to continue to drive performance in the second half of the year.

As Andrew will open the call I will close it it's up to us to now deliver quarter on quarter and regain that competency north delivery. So thank you for the time and we'll look forward to other conversations.

Yeah, I I I just build on Lawrence point with you. You had mentioned that these are competitive markets and others have invested in those markets. And we are not naive to that. We truly appreciate that with that. You know, the innovators do have a degree of stickiness because they were able to get into the market first. Um, but I was at 1 of the recent conferences and I reminded people that there are other ways to create stickiness too. Um, and that is, you know, we bring to the dance, you know, a broad portfolio. We meet, uh, customer needs across a number of different areas. Um, we continue to invest in those relationships and we continue to invest in making it easy to do business with neoen that also comes with a degree of stickiness. And so, um, we respect our competitors, we respect their Innovation, um, but we also, uh, our our, our hungry to get into those segments and we have

Yeah.

Warren Stone: Perfect. Thanks, guys. Thank you.

Thank you. This does conclude today's conference call. You may disconnect at this time and have a wonderful day. Thank you once again for your participation.

Puneet Souda: Your next question is coming from Puneet Souda from Learinc. Puneet, your line is live. Please go ahead. Yeah, hi, guys. Thanks for the questions here.

Puneet Souda: So first one, could you elaborate a bit on the size of the oncology salesforce now? And how do you, you know, what's your strategy in continuing to compete in that market? How much of the NGS sales is sort of coming from the oncologist channel versus the pathologist channel? Maybe just help us understand that. And largely because the competition here is only rising when it comes to therapy selection. You have one competitor that raised capital in the public offering. You have liquid competitors that are now launching tissue, and then there are existing incumbents there. So just given all the landscape of that market, what's your NGS growth longer term?

Demonstrated over time that if we have a competitive profile product that we bring to Market, even if it lags in time, we have been able to sufficiently grow those businesses. And so, um, we believe in the profile that we have with pant, Tracer and the pant, Tracer family, and um, respect our competitors. But believe we can grow in that environment and then the focus on operational execution and turnaround time, and continuing to improve as well. I think, you know, has allowed us to grow and retain

Got it. That's helpful. And then um, on the Opex side, if I could, um, could you clarify if you're expecting an apologize if I missed this. Um, if you're expecting any Opex muts, um uh in in in the guide for this year, um, I don't know if if you can talk about next year yet.

Uh, yeah, we're not talking about next year yet. We need. I think, you know, we we

Warren Stone: And then could you elaborate on the oncology salesforce side? Warren, do you want to just talk a little bit about size? I would like to address this stickiness question as well. Yeah, I think we have executed against exactly the plan that we had spoken about in late last year and beginning of this year. Getting our sales team to roughly that 135 people and sort of 40% of those resources fall within the oncology sales specialist side of things. The greater majority of the growth that we're seeing actually is being driven by that sales team, so coming from the therapy selection side of the business.

We continue to to achieve operating efficiencies and expect we'll see some operating efficiencies in the back half of the year. Um, and I think there's we have a, I say a high focus uh on continuing to to see improvements there.

Okay, thank you.

Thank you.

Thank you. This does conclude today's question-and-answer session. I would now like to turn the floor back to Tony for closing comments.

Warren Stone: There is some that comes through the pathology channel, etc., but that's the minority portion. And actually, when we speak about these new products that contributed 23% of the business in Q2, the majority of that business too is coming from the OSS side of the business. So, despite the increasing competitive landscape, we certainly continue to penetrate effectively, and we believe the sort of 25 or so percent growth rate that we put out there still is very much attainable, especially when we launch Pantrase Liquid tomorrow.

Tony Zook: Yeah, I'd just build on Warren's point. You had mentioned that these are competitive markets, and others have invested in those markets, and we are not naive to that. We truly appreciate that. The innovators do have a degree of stickiness because they were able to get into the market first. But I was at one of the recent conferences, and I reminded people that there are other ways to create stickiness too, and that is we bring to the dance a broad portfolio. We meet customer needs across a number of different areas. We continue to invest in those relationships, and we continue to invest in making it easy to do business with neogenomics, and that also comes with a degree of stickiness.

Tony Zook: And so, we respect our competitors. We respect their innovation, but we also are hungry to get into those segments. And we have demonstrated over time that if we have a competitive profile product that we bring to market, even if it lags in time, we have been able to sufficiently grow those businesses. And so, we believe in the profile that we have with Pantrase or in the Pantrase family and respect our competitors, but believe we can grow in that environment. And then the focus on operational execution and turnaround time continuing to improve as well, I think, has allowed us to grow and retain.

Puneet Souda: Got it. That's helpful.

Jeff Sherman: And then on the OPEX side, if I could, could you clarify if you're expecting, and I apologize if I missed this, if you're expecting any OPEX cuts in the guide for this year? And I don't know if you can talk about next year yet. Yeah, we're not talking about next year yet, Puneet. I think, you know, we continue to achieve operating efficiencies and expect we'll see some operating efficiencies in the back half of the year, and I think there's, we have a, I'd say, a high focus on continuing to see improvement.

Operator: Okay, thank you. Thank you.

Tony Zook: This does conclude today's question and answer session.

Operator: I would now like to turn the floor back to Tony Zook for closing comments. I would just like to thank everybody for joining us on the call. I do appreciate the direct questions and the opportunity to present our results and as well, our direction moving forward. I would like to remind everyone, though, that we did do a pretty good job on that clinical side. We grew that business 16%. We had a record quarter for volumes. Really exciting NGS growth rate, and we are poised to continue to drive performance in the second half of the year, and as Andrew opened the call, I will close it.

Tony Zook: It's up to us to now deliver quarter-on-quarter and regain that confidence in our delivery. So thank you for the time, and we'll look forward to other conversations. We. Thank you.

Operator: This does conclude today's conference call. You may disconnect at this time and have a wonderful day. Thank you once again for your participation.