Q3 2025 SOPHiA GENETICS SA Earnings Call

Speaker #1: Good morning. My name is Kelsey, and I'll be your conference operator today. At this time, I would like to welcome everyone to the SOPHiA GENETICS third quarter 2025 earnings conference call.

Speaker #1: Kellen Sanger, SOPHiA GENETICS Head of Strategy, Investor Relations, you may begin.

Speaker #2: Thank you, and good morning, everyone. Welcome to the SOPHiA GENETICS third quarter 2025 earnings conference call. Joining me today to discuss the results are Dr. Jurgi Camblong, our co-founder and chief executive officer; Ross Muken, our company president; and George Cardoza, our chief financial officer.

Speaker #2: I would like to remind you that management will make statements during this call that are forward-looking statements within the meaning of federal securities law. These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated, and you should not place undue reliance on forward-looking statements.

Speaker #2: Additional information regarding these risks, uncertainties, and factors that could cause results to differ appears in the press release issued by SOPHiA GENETICS today and in the documents and reports filed by SOPHiA GENETICS from time to time with the securities and exchange commission.

Speaker #2: During this call, we will present both IFRS and non-IFRS financial measures. A reconciliation of IFRS to non-IFRS measures is included in today's earnings press release, which is available on our website.

Speaker #2: With that, I will now turn the call over to Jurgi.

Speaker #3: Thanks, Kellen, and good morning, everyone. I will start with a brief recap of Q3 performance and an update on major growth drivers. I will then turn the call over to Ross, who will provide a more detailed update on the business.

The second cost driver, I realized life is our continued growth in the US market in. Q3 us Revenue grow and impressive 30% year-over-year on top of an increasingly larger base.

We also signed a strong cohort of new customers to fuel growth in Q3. We landed Gating their health system in Pennsylvania with adopting SOPHiA, dbm for pharmacogenomics; Baylor, Scott and White Health in Texas with adopting SOPHiA, dillian for Iman; and Thermo Fisher Life Labs with adopting solid tumors and rare disorders applications. Welcome all to the SOPHiA community.

The third, gross driver, I will cover is the continued success of our liquid. Biopsy application, msk access.

Part of the updates today, I will take a moment to reflect on liquid, biopsy, business abroad, the progress we have made and what the future holds.

Few years ago, we partner with membrane Sun, Katherine to industrialize their world renowned test and make liquid biopsy testing accessible to every lab in the world. This presented a series of challenges, not only due to the very small amount of circulating tumor DNA in a blood sample, but also, because of growing from lap to lap. In other words, reliably decentralizing, liquid biopsy is complex, and many variables are at Play.

To solve for this complexity, we leveraged the Decades of experience in our diverse Data Network to build proprietary AI agents, that standardized harmonize and analyze liquid biopsy data.

This agent which power msk access and other Sophia applications. Apply AI to find signal in the noise and deliver actionable insights to our customers.

Thanks to this AI capabilities. MSC access is now available to Labs across the globe.

Since it's launched. Last year, we have now signed more than 60 liquid biopsy. Customers worldwide.

As our liquid biopsy network has grown, biopharma companies have recognized the value of such a network. Several months ago, we announced that Estraza would sponsor the global deployment of MSK Access.

For high-quality and affordable liquid biopsy testing, it is critical for expanding market access. In addition, the data generated from the network offers immense value for drug development and commercialization.

During the quarter, we announced the next phase of our liquid biopsy strategy in September. We announced a partnership with mere genetics to develop MSP access into a regulated companion Diagnostic in the US.

And then in October, we announced a collaboration with Adam Innovations to do the same in Japan, together with SOPHiA's robust regulated footprint in Europe. SOPHiA and its partners will offer BioPhora, a first-of-its-kind hybrid global Companion Diagnostic (CDx) asset fit for purpose, depending on the needs of the local market.

This innovative CDx will provide bio-pharma companies with a unique and cost-effective offering to potentially expedite drug development and approval. It will also enable more patients to gain access to tumor profiling benefits from liquid biopsy.

As we continue our mission to expand access to best-in-class Cancer Care. I would like to take a moment to look towards the future.

Last month at esmo we announced a breakthrough technology called Sophia DDM digital twins.

Digital twins goes beyond genomics by leveraging multimodal data to help oncologists make better treatment decisions.

The AI powered research tool creates Dynamic virtual. Representations of individual patients to simulate potential outcomes and help oncologists select the best treatment.

Starting with long cancer oncologists can now generate digital twins for genomic, patients analyzed with Sophia DM, including MSP access.

Of data-driven medicine to the new age by leveraging Ai and the collective intelligence for our community to provide oncologist with real time. Real world decision support Based on multimodal data, please stay tuned for more updates on the development of digital Twins and the expansion of this exciting technology.

Before I am it over to Ross, I would like to recognize the Sophia team for their continued ability to deliver amazing, new products like digital Twins and drive Revenue growth without increasing cost.

In Q3, we help grow margins strong at 73.1% on an adjusted basis. Despite the data process by our platform, going over 40% year-over-year. This performance was driven by Innovations from our Tech and data science. Teams, who continue to engineer new ways to optimize the data compute and processing power of Sophia dbm.

I was also proud that we carried growth down to the bottom line in Q3. We improved that just a bit, 13% year-over-year after excluding the impact of elevated social charges on stock-based compensation. Excluding these charges, operating expenses remained mostly flat on a constant currency basis, a testament to the natural operating leverage in our business and strong actions on control across our teams.

In conclusion, Q3 was an excellent quarter for Sophia. Revenue accelerated once again and cost performance improved. We have built an expansive, Global Network of customer who use Sophia DDM each day to generate insights for their patients in Q3 alone. Sophia DM analyzed over 99,000 patients across 70 countries, worldwide. Thank you again to the team for an excellent quarter. And for the impact you're making with that, I will now turn the call over to Ross will provide a more detailed update on Q3 business performance.

Surgi, the Golden Market teams, share your excitement and confirm. There is Broad and growing demand for the Sophia offering along those lines. I'll start today by giving a brief update on our third quarter, performance as 2025 continues to be a strong year across both new and existing business. I'll then cover a broader market dynamics before closing with a look at what we are seeing in the pipeline.

First we delivered 23% Revenue growth in the third quarter as biofarma headwinds subsided and the continued strength of the Core Business was able to shine.

from a regional perspective and Nia returned to Historic growth levels with 24%, Revenue growth in the period,

Major markets such as the United Kingdom and Belgium contributed significantly to regional growth, with the countries growing 120% and 70% in the period, respectively. As Jurgi mentioned, North America continued to outperform in the third quarter with 29% revenue growth year-over-year. The Asia-Pacific region also continued to outperform in Q3, as analysis volume grew 35%, driven by Australia and Taiwan. Notably, we also saw the first revenue from Japan come online as our partnership with Adam Innovation begins to ramp in Latin America. We continue to experience softness, but recent bookings and the momentum give us confidence that the region will return to meaningful growth in the medium term.

From an application standpoint, we continue to establish ourselves as the global leader in hemato-oncology testing. The Mark analysis volumes grew 18% year-over-year in the third quarter. In large phases beyond the Mark, we saw an initial wave of liquid biopsy testing coming online as we passed 2,000 liquid biopsy analyses in the quarter. As a reminder, more sophisticated applications like MSK Access carry a substantially higher ASP than other product lines.

We will look to the fourth quarter and into 2026. For msk, access to meaningfully drive over all growth as customers, complete implementations and ramp up usage.

With biofarma headwinds now behind us revenue from biofarma returned to positive growth in the third quarter and is no longer a drag on our overall performance.

We view biofarma, as an additive contributor going forward, as we deliver on recently signed biofarma wins, including the multiple projects signed with astroica this quarter.

Levels. We landed 31 new customers in the quarter up from 22 signed in Q3 last year, as jirgi mentioned, the expand engine was also exceptionally strong. We will continue updating you on the expansions going forward and this will be a major strategic Focus for us as we move into 2026 in North America. Jirgi highlighted our incredible momentum in the US.

Beyond the us. We also expanded our partnership with Sunnybrook Health Sciences Center in Toronto,

Sunni book is adding a sixth DDM application now. Adopting msk access our expansion to 1 to 6 applications when Sunnybrook over a short period of time is a great example of our land and expand strategy in action.

In a Mia msk access continued to attract major interest in the third quarter. We signed the University Hospital of niece in France and hsl in the United Kingdom to the application amongst others. We also signed the American University of Beirut to our newly launched solid tumor application, msk impact Flex

In Latin America, we continued our expansion in the south and side clinic on meds in Chile to our whole EXO solution. We also continue to see new business momentum in Brazil and signed the Carlos Chagas Institute, which will be adopting SOPHiA DDM to support him on testing. We look forward to LAD and picking up.

Growth in quarters to come as we implement the recently signed new business.

In asia-pacific. We were proud to announce the developments of our entry into Japan. Adam Innovations is currently working on implementing a full Suite of Sophia applications including solid tumor hereditary, cancer rare disorders and liquid biopsy as mentioned earlier by Yuri. Atom will also play an important role in the global CDX. Offering we are developing, I'm happy to say we are already seeing strong demand across Japan on both clinical and biofarma sides.

On that note, I'll take a second to highlight our refresh momentum with biofarma as discussed in detail. Last quarter, we signed the largest contract in Sophia's history with astrozen and August taking off a multi-year project to improve outcomes for breast cancer patients. In addition in September, we signed a separate deal with as to enhance detection of breast and prostate cancer. As part of the partnership aztap Sophia to leverage our AI algorithms to develop an application with the detects, mutations in the P10 pathway, a key, molecular singling Network linked to development of breast and prostate cancer. The pathway is also notoriously complex from a variant calling perspective and we were proud that as chose Sophia as its partner on this project. This project should also serve and get another proof. Point of the value of Sophia's Ai and our reputation is a leading data science.

And Tech player in the space.

Broadly across markets in the business customers are increasingly turning to Sophia to help them. Make sense of complex data over the past 3 years. We've seen an explosion of data production and Healthcare sequencers. And other multimodal equipment are becoming cheaper and capabilities are becoming more advanced alumina Altima, MGI element, and now row have all deployed products that are producing increasingly, larger deeper and more complex data. In addition as data capabilities, increase more sophisticated therapies and tests are emerging. Among other indicators ctdna is increasingly recognized as a valuable way to follow, patients longitudinally, and determine proper treatment. Further, sophisticated tests like liquid, biopsy mrd, and hands, exomes and hrd are all in high demand, broadly. These Trends need 1 Thing. Hospitals labs and health systems are increasingly looking for partners like Sophia to help them analyze.

Process and make sense of complex data as a company that is invested more than 450 million dollars in bringing an AI platform to help clinicians analyze complex. Health Data Sophia is perfectly positioned to take advantage of these trends at esmo last month we constantly heard these Dynamics echoed by our customers data is exploding data. Complexity is rising and these new sophisticated tests continue to

Those local expertise and make better use of valuable patient data in-house. Testing also drives operational efficiencies by reducing test turnaround times, making better use of Labor resources and keeping testing profits, in-house, instead of giving them up to a centralized player, combining all of these Trends, what does it mean for Sophia in short? It means that demand is higher than ever pipeline in the third quarter is of substantially since last year and bookings. In the first 3 quarters of 2025 or more than double. Those of 2024, not only are we Landing more customers than ever but our customers are getting larger average contract value of the 31. Customers in Q3 was up over 180% year on year. Additionally, the number of 1 million dollar opportunities in our pipeline has expanded materially. I continued to be pleased with our positioning as well as the growth of our Pipeline and of our end markets and I look forward to updating you on these items in the coming months with that. I

Will now turn the call over to George? Who will provide a more detailed? Look at our third quarter Financial results.

Thanks Ross and good morning everyone. As you and Ross. Highlighted 2 3 results came in ahead of expectations as the influx of new business begins to come online.

Total revenue for the third quarter was 19.5 million compared to 15.9 million for the third quarter of 2024 representing year-over-year growth of 23%.

As a reminder Revenue grew by 13% in the first quarter and 16% in the second quarter, so the growth momentum continues to build.

Platform analysis, volume was approximately 99,000 during the quarter compared to 91,000. In the third quarter of 2024 representing year-over-year growth of 9%

for genomic, customers with 488, as of September 30th up from 462 in the prior year, period. But down to customers relative to Q2 2025,

as Ross mentioned, we have intentionally focused our sales team on winning larger accounts.

While we move 15, new customers into routine this quarter. We also churned out small accounts, the average revenue across all, churn customers in Q3 was less than $8,000 going forward. We will continue to focus our sales team on larger accounts and the favorable results are showing

net dollar retention for the quarter was 108% with strong performance in Europe, Asia Pac, and North America partially offset by a decline in growth in Latin America.

Annualized Revenue churn remains at approximately 4%.

Gross profit for the quarter was 12.9 Million compared to 10.7% year-over-year growth of 21%.

Gross margin was 66.3% for the third quarter compared with 67.2%, for the third quarter of 2024. Adjusted gross profit was 14.2 million in Q3, an increase of 23% compared to adjusted growth profit of 11.6 million in the prior year period.

Adjusted gross margin with 73.1% for the third quarter remaining flat year-over-year. Despite the substantial increase in volume of data, computed by the platform.

As yoongi mentioned, targeted, platform improvements. Have driven Cloud, compute and storage costs, lower throughout 2025, and we remain proud of and expect to continue going forward.

Total operating expenses for Q3 with 30.8 million compared to 26 million in the third quarter of 2025.

However, Q3 results were adversely affected by a series of items during the quarter, which temporarily impacted results, but do not reflect the company's underlying operating performance.

First, share price, appreciation of 54% at the end of the third quarter, resulted in higher, Swiss social charges on share-based compensation.

As these are remeasured with the company's share price under local regulations.

These elevated social charges accounted for a 1.3 million increase to Opex this quarter as compared to a 700,000 benefit last year. In Q3, these costs are not reflected as adjustments in our adjusted ebit. A table per sec guidelines.

Second adverse foreign exchange movements at the end of the quarter negatively impacted reported Opex by approximately 700,000, primarily due to the strengthening of the Swiss franc.

The Swiss franc is appreciated by 14% since the start of the year, which means that our payroll and rent expenses in Switzerland are translating 14% higher when viewed in the US dollars.

Third garden Health filed suit against us in Europe and the United Kingdom, alleging patent infringement in the msk access application, which we believe to be without Merit, this resulted in higher legal expenses in the quarter of approximately 600,000, which is reflected as an adjustment for litigation in our adjusted Eve at a table.

Forth during the quarter. We completed an at the market facility with TD Cowen, along with completing a shelf offering at the SEC declared effective on August 8th.

There were 445,000 of costs associated with the ATM facility, and the shelf that we have adjusted for, in our adjusted ebit, a table. As they are not expected to recur in 2026,

After adjusting for these items and other standard IFRS adjustments, operating expenses. Grew only 1% driven by sales and marketing Investments, which continue to deliver High returns. Despite these temporary charges. We remain proud of our ability to grow Revenue 23% without substantially increasing headcount or Opex.

Moving down the pnl operating loss for the quarter was 17.9 million compared to 15.4 million in the prior year period.

Even a loss for the third quarter was 15.4 Million compared to 13.2 million and the prior year period.

Adjusted even a loss was 10.2 million up 8% from the prior year loss of 9.4 million.

Excluding Swiss social charges and share-based compensation for both years. Adjusted operating loss and adjusted ibida would have improved 13% demonstrating our ability to deliver operating Leverage

as with previous quarters, we remain laser focused on driving efficiency gains across the business and reducing costs down the p&l

Lastly total cash burn which we Define as a change in cash and cash equivalents. For the third quarter of 2025 was 13.1 million compared to 9.6 million. In the prior year quarter representing a year-over-year increase of 36.5%.

The cash outflows in the third quarter of 2025 include 500,000 invested in atom Innovations in Japan. A 1.7 million reduction in our accounts payable balance as some large. Vendor payments were processed and interest expense which increased by 1.1 million from the prior year, due to increased borrowings under the perceptive credit agreement.

We finished the quarter with cash and cash equivalents of $81.6 million as of September 30th. We remain confident in our current capital position with respect to the achievement of our long-term goals.

I'll now turn to our 2025 Outlook.

Given the promising re acceleration of Revenue growth we've had in the last 3 quarters. Sophia genetics is updating our full year Revenue. Guidance for 2025, we are raising our full year. Revenue, guidance range. As revenue is now, expected to be in the range of 75 to 777 million representing growth of 15 to 18% this compares to the previous range of 72 to 76 million.

Adjusted even at a loss, guidance has been revised to a loss of $39 million to $41 million compared to $40.2 million for 2024. The primary drivers of the change are the swift social taxes on our stock-based compensation, along with the appreciation of the Swiss franc and the Euro, and the impact that they have on our European-based expenses, such as payroll and rent when translated over into US dollars.

On a constant currency basis, our expenses. Remain as expected, excluding the social taxes,

Despite these impacts, we expect we'll be able to continue to show operating, leverage for future Revenue growth.

We continue to make targeted investments in our platform and optimize Cloud compute and storage costs and expect to have modest, gross margin expansion Beyond current levels.

We expect to continue to hold the line on operating expenses in local currencies and excluding social charges, as we currently have the correct team size to support our medium-term growth objectives.

This excludes some high Roi Investments. We will continue to make related to marketing activities, as well as certain investments in the commercial team including commission payments for over performance.

We also expect a modest increase in our implementation teams to handle the increased volumes of new accounts.

Our growth has been accelerating and we believe these investments will pay off in 2026 and Beyond.

2027.

With that, I would like to turn the call back over to yorgi for closing remarks before we take your questions.

To close this quarter. Mark, another period of accelerated Revenue growth with 23% year-over-year, Revenue growth reflecting strong execution of our teams, and the growing impact of our platform.

Forward-looking indicators, remain strong across the business. We continue to see a steady stream of new customer signing, substantial new bio, former Partnerships Rising average contract size, and the healthy expansion in pipeline, across regions and applications.

On top of this, we continue to be laser focused on optimizing cost and delivering sustainable growth.

I am confident as ever in our long-term trajectory, and momentum in our business is building

I look forward to continuing to update you all on our progress in the future.

With that. Thank you to the Sophia team customers partners and investors for joining us on our mission to transform Patient. Care by expanding access to data-driven Medicine globally. Operator. You may now open the line for questions.

Thank you, ladies and gentlemen. We will now begin the question and answer session. Should you have a question, please press star followed by the 1 on your touchtone phone. You will hear a prompt that your hand has been raised.

Did you wish to decline from the polling process? Please press the star followed by the 2, and if you are using a speaker-phone, please, lift the handset. Before pressing any Keys 1 moment, please for your first question.

In your first question comes from Bill panelo. From Craig Holland, please go ahead.

Hey guys, thanks a lot for taking the question and and good quarter. Um, so just a couple of things, I I'd love to follow up on. So first of all, in terms of the guide and I I I think I get what you're doing here, uh, and appreciate it, but I just want to make sure um, the midpoint of the guide sort of implies a, a mid-teens growth for, for Q4 versus the 23% growth that you had. Uh, this quarter is there any particular reason that we would expect, uh, growth to decelerate next quarter, or is this just kind of prudence?

Hi, good morning, V. Given he has a post in the business. Uh, thanks Bill. And, and, uh, good question, I would say, Obviously, you know, all year we've been generally conservative with our approach to guidance, right, coming off of 2024, we wanted to make sure we were set up, well, to be able to continue to, uh, overachieve and and obviously, you see us do that this quarter and, and raise our guidance. I think, in general, the business has fantastic momentum. Uh, we had another tremendous quarter of bookings. Uh, we're bringing quite a lot of business online. I think we wanted to just be prudent, uh, right, uh, heading into the year end. Um, but frankly though, we don't see any any change in in, kind of the key drivers of the business and feel very confident that our growth overall will continue to perform in line with our expectation, Andor continue to accelerate

Thanks. And then, um,

The msk you talked about 60 60 customers now um, signed up. Um can you give us a sense of of how many of those customers are already uh performing analysis, or generating revenue? And how many yet uh, you know, are yet to to go live? And then maybe I know you talked about it a little bit, but maybe a little more, uh, color or commentary on the on the pipeline of potential customers that you might be able to add going forward.

Yes sure. I will start Bill and then I said Ross, good job but I will start by telling that you need to your point on the pipeline. The demand in the liquid bio is growing right? It is generally becoming more and more adopted, can you tell me more and more important?

Liquid biopsy remains, I would say, a super hot area for diagnostics in general. If we were to receive a lot of demand, um, certainly, you know, we're very happy with the rate of adoption over the last 12 months, in terms of the 60 signed logos. So, assuming about 20% of those have started to enter routine, although still, uh, based on the numbers we shared in terms of the monthly cadence, it's still quite modest. Uh, we expect that to ramp pretty materially over the next 1 to 2 quarters. We have some very large counts coming online in the fourth quarter and into the first quarter of next year. And so, uh, you know, we're quite confident that, that trajectory will continue to inflect.

Uh, and then for 2026, we will see very strong growth, uh, from this product and, and 1 as well as we think about, uh, CDX and and our announcements there, and we can touch on that. We continue to see a multi-year, uh, trajectory that's going to be uh, driving this business, uh, for the foreseeable future.

And if you'll allow me just one last question, you mentioned Thermo Fisher as a customer. Can you just talk a little bit more about what they'll be doing and how they're using the product?

So, uh, you know, Thermo is using it, uh, in 1 of their Laboratories, I would say. Uh, we're probably not at Liberty to share a ton more but certainly, uh, as you think about many of the typical vendors and they are 1, who does CDX, you tend to do orthogonal, uh, studies and work. And, and also tend to use other Technologies of other, uh, competitors of which you do not have, uh, you know, sort of applications and or bioinformatic capabilities. And so, uh, I would say, think about it in, in that vein, we're very excited to have them as a customer. Uh, obviously we already serve quite a lot of thermal instruments as well in the field. Uh, and so, I would say in this vein, uh, this is sort of a new Avenue for us and and and an important 1. Uh, but unfortunately, I can't give you a ton more detail on the project just because of its a confidential nature.

Sure, makes sense. Thanks a lot.

Thank you, and your next question comes from.

W nandi from go 9, please go ahead.

Hey guys. Good morning. Thank you for taking my question. Um, what is your outlook for biofarma and be spending and overall funding for 2026?

Yes, uh isubu. Uh, we have been speaking a bit about the bio for penalizing in the past, right? And as changing the strategy being focusing on, um, things that were very well. I would say defined around data around the Diagnostics and being highlighting in the previous quarter, this strategy has been picking up, we announced last quarter as well. A deal. We made with that certain account, the data set, which we qualify as being the, the bigger deal in the biofarma historically. But beyond that on, 26 Ross, what can be sure. Yeah, so I would say it's super coming out of esmo, I was super encouraged. So if you think about, uh, a lot of where we're positioned relative to Pharma pipelines, as well as we're Pharma is allocating dollars. We're in a very favorable position by Farmers increasingly. Uh, I would say, looking to support a hybrid centralized centralized approach for CDX and

Us with our partner Myriad, uh, have fantastic. I would say capabilities in that front and also to do CTA and other sponsored testing. Uh, additionally, I would say, if you look at what they're doing with AI, uh, we have really unique capabilities in terms of algorithm development and unique data sets that we have access to that. Uh, as you saw in the first example, uh, Garner a lot of interest and we would expect to see more of that additionally again being uh, you know, well, positioned in liquid biopsy, which is

Potential deals in the pipeline with. And so, we're, we're quite encouraged about what that could contribute in 26 and Beyond.

That is really encouraging to hear. Um, how did customer onboarding setup times trend in Q3? Did you notice the macro environment affecting this in any way, or do you have concerns about this? Any U.S. government shutdown impacts?

So first, uh, as you know, also go for us, uh, signing DC, right? And we are being highlighting that actually booking. Uh, NAC Vis are booking up a very good, but then we don't generate revenue and until our platform is being implemented. Given we're being paid on usage, right? So lots more color on the implementations and the impact of the background. Yeah. So in general, uh, we're actually seeing healthy activities across the entire funnel. So pipeline remains robust. Bookings, were very good in the quarter and implementation, certainly on a dollar basis continue accelerating. So this quarter, we had a bit more, uh, expand applications come live than than new logos, but I would expect you 4 to be quite strong. We actually just had a record October, uh, and so, on that level activity levels again, and this is across multiple geographies continue to be quite good. So, for us on the macro side, the environment is uh is super healthy. Uh and I think you've heard this from some of the sequencing providers as well. We've talked about clinical value

Has been strong. And so, obviously, with that, in the increased data, uh, production on those volumes, you know, for us at the moment things are, are, are continuing to, uh, to be quite strong. Yeah. So, we know impact from the government shutdown, uh, so far at least on our side.

Perfect, thank you so much, guys.

Thank you.

And your next question comes from Mark M mazaro from btig. Please go ahead.

Hey guys. Uh thank you and congrats on the strong quarter.

I wanted to ask a little bit about the large Pharma customer you have in astroica. Um, how much, uh, was there a benefit in Q3? Um, and if not, uh, should we, I, I think we're expecting that to pick up here in Q4, was hoping, if you could just sort of walk me through that and then related to that, can you just speak to the strength and biofarma if you exclude astroica?

That's true. So, Mark and George. We start on your question regarding the financial side. And then Ross, we give you some more color on the, the recent activities we had at this time. Yeah, that was a fairly small amount Pharma and Q3 and we send that last quarter, the Pharma was really going to ramp up in the fourth quarter. Uh, you know, again typically these type of contracts, take a couple of months to to get projects going. And the revenue is typically recognized when Milestones are hit, so uh, but we do expect to hit some of those milestones.

In the fourth quarter. And, you know, as as you said really the, the thing that we're excited about and with the far side is uh, really when you start to look out at 2026 and 2027, we're still very bullish on this business and what it can become and it's exciting to see the projects that we've already won. And, uh, you know, and the pipeline is, is is not the, you think if you signed a lot of contracts, maybe your pipeline would be down the exact opposite happened. The pipeline, uh, is actually even gotten stronger at the same time. So we're, uh, we remain very bullish about the Pharma business. We've talked about the Myriad partnership, what we're doing in Japan and, uh, we believe wholeheartedly there's a great business here. Yeah, so Mark, I would say, you know, obviously astragin is a fantastic partner, uh, particularly given the health of their pipelines, right? So being tied to 1 of the large Farmers that has a ton of new, uh, product. Introductions is obviously as a diagnostic and, and data player incredibly beneficial. But to your point, obviously, we've been super focused on broadening out the pipeline as I was mentioning before.

Uh, that has uh, expended pretty materially, not just in size, but also in the sheer number of farmers in the pipeline, I could also confirm, we we've won other deals outside of Astra zenica. Uh, some that are are quite significant. But I would say, uh, you know, for various reasons you can't always press release, uh, depending on where the drug is or or where the uh project is in its stage, sort of the, the winds, but I would say overall, uh, we're quite happy with that momentum and we would expect

again, uh, you to see, uh, further adds on that side, over the upcoming quarters and into 2026 is the business continues, its recovery,

Okay, great and um between Myriad genetics and uh the customer formerly known as Genesis HealthCare. I think you've got companion Diagnostics with both. Um, can you just give us a sense on timing? Uh, how you're thinking about Regulatory? And when you think these might start contributing to your business?

So as you understand, right spending on on the regions regulatory basically Frameworks are different. So the partner we have in Japan is to to fulfill basically the regulatory authorities in Japan. And the 1 we have in the US is to fulfill that well regular activity duties and opportunities in the US market, right? And the, the why uh we've been expanding our offering as you know, America will be very successful with our decentralized model. But in some instances pre-market from our ones to do that in a single site, PN uh so and 6 like the the Inception of these Partnerships, anything else you would like to? Yeah. So I would say work uh you know again coming out of asmo or even more so than ASCO, we heard consistently a drum beat a, a huge interest in msk Access is kind of a global CDX tool. And again, if you think about the existing environment, typically today if you hire 1 of the, the current vendors

or centralized your, your normally having to hire probably another 5 to 7 vendors to cover the Diagnostics globally through the commercialization. Whereas now with a strong partner in Myriad, is obviously a very well known in the space, uh, having delivered, you know, really, uh, strong results with my choice and other products in the past. So they upgrade regulatory experience for the US market. We have, uh, Genesis or or now, Adam Innovations. Whose, uh, generally quite a lot of interest honestly in Japan.

Uh, as well. And obviously our ability to sort of deliver, uh, applications for the rest of the world. I think that's, uh, garnered quite a lot of, uh, of of, kind of curiosity of Pharma. That's now, turning into real opportunities. We actually already have, uh, several opportunities we're involved in in the market. Again, doesn't mean we will win, but certainly we're already engaged. So that should give you a sense of our preparation and timing of when we expect this to be able to be available as as certainly, uh we're already in in sort of that process. But I would say certainly we want to take our time, you know, we'll obviously work with our partners closely on on bringing these tools to Market. But, you know, again I would send a multi-year basis. This this has the potential to be a really significant driver for, uh, Sophia going forward.

Fantastic and just 1 last 1 for me. Um you know you made some really good progress, signing new customers uh including to msk access on Sophia DDM. Uh you talked about the majority are expected to complete implementation and begin generating Revenue in the next 3 to 6 months. I'm just trying to get a sense as we think out to 2026. Um, is there in your view? Do you think you'll continue to onboard, uh, new msk access uh, customers each quarter or do you think there's a, a big bolus uh sort of like, you know, Q4 into q1 and then that will start to level off? I'm just trying to get a sense, uh, for the business in 26.

Yeah. So I would say, in general bark, we're obviously quite enthusiastic about this product route, uh, as we've said, uh, you know, these will come online as you as you mentioned. I would say, you know, it's never perfectly linear as you would expect. So there will be some step function changes. But, uh, ultimately the potential here with the existing side accounts is quite significant to contribute to our our business and then obviously CDX as well. And so we remain very confident in that contribution to the 26th growth rate and Beyond. And I know you're, um, interested knowing, uh, you know what our plans for mrd as well, don't get clear on the decentralized world. What would be the mrd applications? Uh, both clinically and technologically? But typically msk access, which enables as well to measure cdna could be common in m.

That's great to hear. All right, thanks guys.

Thank you. Thank you, Mark.

And your last question comes from Dan Brennan from TD Cowen, please go ahead.

Hey, good morning, guys. This is Kyle on for Dan, thanks for taking the questions. I just wanted to build off the last question a little bit on the, on the customer implementation. I mean, you, you added over 30 customers this quarter, and, uh, I believe you exit in Q2, you had somewhere around 100 customers in the backlog, waiting to be implemented. Um, can you discuss with this backlog is today?

Better. And so we're spending a lot of time and effort to, uh, optimize the end-to-end process. Some of that also at times is outside of our control. Whether it's, you know, someone needing a regulatory approval or something on the reimbursement side. But generally I would say the trend is favorable, the backlog is substantial. It gives us a lot of forward visibility. Uh, and again it's it's why we remain confident in continuing in our path to kind of growth acceleration in the fourth quarter and into 2026.

Got it and and it may be on that then maybe it's too early to tell, but, you know, looking at where consensus is for 26 right now. I think it implies somewhere around mid teens growth and I mean if you add the clinical momentum um you know far and getting better, you know, not being a headwind next year. Is there any reason to think that growth couldn't be better than that next year?

George, we've always tried to guide conservatively and I I think as Ross said, you know sometimes things aren't always linear you. You kind of have you know a bit of the trends going 1 way or another so I think we want to put out guidance that uh is reasonable and then certainly yes. You know, I think, you know, you've just seen this past quarter where we've put up a very nice number and we're going to continue to try to overachieve. But I think in terms of the 2026 expectations you know where the consensus is is uh is probably reasonable and we're going to do everything we can to to over-perform. Yeah. And so Kyle I would say certainly, you know, we're several quarters into a reaxis. There's no reason to think that there's

Anything changing at that trajectory in our business. Obviously, we've talked about strong new business momentum, all year, and this quarter, we're talking a bit as well around the Pharma, uh, re acceleration and Recovery. Uh, but as George said, obviously, you know, we want to be prudent, but but at the moment, we're obviously feeling quite confident, uh, on our trajectory and and again, our long-term goal is to get back to more historical growth rates that you saw from us in the past. And so uh that's the that's the uh the ambition. And so we're going to continue to push towards that.

Got it. Thanks guys.

Thank you. Okay.

Thank you. There are no further questions at this time. You may proceed.

Thank you very much for joining us today and please continue following up. And once again, I congrats to the Sophia team who delivered the Fantastic order.

Ladies and gentlemen, this includes today's conference call. We thank you very much for your participation and you may now disconnect have a great day.